Barnes & Noble Education, Inc. (NYSE:BNED) Q2 2023 Earnings Call Transcript

Thomas Donohue: Yes, thanks Alex. I think the way to think of it is, given that we’re through at this point six months, as we reported, and then obviously through seven months if you count the month of November, the 10 to 15 is really the rest of the run rate basis for FY23, and when you annualize that, you get closer to that 30 to 35. The steps and initiatives are being implemented as we speak – some has been done, some will continue to be done, and that’s really what our expectation is and you would expect the full annualized effect of that 30 to 35 would be in the ’24 numbers for sure.

Michael Huseby: Yes Alex, one more comment I would make is that having been through the pandemic and having taken out substantial costs in our shared services and retail right before the pandemic and actually bled into the pandemic in terms of people, we had a back on the spring of 2020 where 70 people accepted that. The point is, it’s given us more flexibility in terms of fixed versus variable costs in our labor force so that we can move more quickly now than we could have pre-pandemic, so that’s why we’re confident in the numbers and getting the benefit now, and then the annualized savings. We also have other areas of improvement that we’re looking at that are just costs – the margin, etc. I don’t want to get into those today that we’re working on, we’re not quantifying any benefits, but we’re not standing still with these actions and these numbers. We’re going to continue to look at ways to protect and improve the margin of what we offer as well.

Thomas Donohue: Yes, and Alex, in terms of reinvesting, it’s really to support the initiatives, with the highest priority being the conversion of schools to First Day Complete.

Alex Fuhrman: Okay, that’s really helpful. Thank you both.

Operator: Thank you. As a reminder, if you would like to ask a question, please press star followed by one on your telephone keypad. There are no additional questions waiting at this time, so I’d like to pass the conference back over to Hunter Blakenbaker for any closing remarks. Please go ahead.

Hunter Blakenbaker: Great, thank you Bailey, and thanks everyone for joining us today and for your continued interest in BNED. As a reminder, our fiscal third quarter earnings will be in early March. Thanks everyone for joining.

Operator: This concludes today’s conference call. Thank you all for your participation. You may now disconnect your lines.