CD Warehouse, Inc. (Oklahoma City), a 309-store chain of owned and franchised music stores, has been delisted from the Nasdaq Stock Market. The retailer had been notified by Nasdaq a month ago that it was not in compliance with the minimum bid price requirement for continued listing. It had filed a written appeal to Nasdaq at the time in hopes of retaining its listing on the exchange.
Last month, on the same day it received Nasdaq notification, the company announced a net loss of $8.67 million for the fiscal year ending Dec. 31, 2000. Same store sales showed a tiny increase of $24,000, or .0004 percent, but system-wide sales for the year were down 3 percent. Sales in the company-owned stores were virtually flat in 2000. The company attributed the decline to a decrease in the number of franchised locations, from 264 at the end of 1999 to 245 at the end of 2000.
“During the third and fourth quarters of 2000, we undertook a number of measures to restore the company to profitability,” Christopher Salyer, president and ceo, said at the time of the March announcement. “Over the course of the year, we closed 17 company-owned stores as part of that measure. These stores realized a combined net loss of $538,000 during the year. As a result of these closings and other operational improvements, I am encouraged by our company owned store operations and anticipate that they will continue to trend toward improved profitability.”
In January, the retailer had announced the closing of nine company-owned stores in Florida, Colorado, California and Oklahoma. The closings, which were completed prior to the end of the 2000 fiscal year, resulted in a one-time charge against earnings of $450,000 in the fourth quarter of 2000. The company owns and operates 64 stores, in addition to the 245 stores owned and operated by its franchisees. Most stores are in strip shopping centers and offer between 10,000 and 16,000 mostly used CDs. Stores acquire much of their inventory by purchasing or trading with customers for used CDs. In late 1999, the company had an opportunity to buy Canadian music retailer CD Plus.com, but the deal fell through.