Indigo reports sales rise, declares 1st dividend

Indigo Books & Music Inc. declared its first quarterly dividend on Friday as the retail chain said its first-quarter revenues grew by four per cent.

The Toronto-based company said its revenues for the quarter came in at $214.5 million, up $8.3 million from the same quarter last year.

Same-store sales at the company's Indigo and Chapters superstores were up by 3.8 per cent, while the firm's smaller-format store brands — Coles and Indigo Spirit — saw sales grow by 6.2 per cent. Online sales through chapters.indigo.ca decreased 6.5 per cent year-over-year to $23.1 million.

While Indigo posted a pre-tax profit of $2.3 million, which was up 21.6 per cent from the same quarter last year, the company's net profit was 1.9 million, down $1.2 million from last year. This year's results include a net tax expense of  $428,000 while last year's numbers included a $1.2 million tax recovery.

The company declared a quarterly cash dividend of 10 cents a share, the first one it has paid to investors.

"We are very satisfied with both our top-line growth and operating profits, especially in this challenging economic climate," said CEO Heather Reisman.

"We are also proud that our strong balance sheet has allowed us to initiate a quarterly dividend while continuing to invest in our future growth," she said in a written statement.

Indigo stock rose 59 cents to $12.60 in TSX trading.