SG&A expenses were $57.8 million, a reduction of 20%, on the sales decline of 18%, lowering the percent of sales 100 basis points to 42.5% from last year’s 43.5%. EBITDA was a loss of $12 million in the quarter, versus $13.3 million last year.

Our net interest expense was $800,000 in the quarter, compared to $700,000 last year. We ended the quarter with cash of $10.5 million, and zero borrowings on our line of credit, as compared to cash of $7.1 million last year, and borrowings of $28 million. Year-over-year, we have lowered our inventory by $83 million. Our quarter end inventory position was $237 million, versus last year’s $320 million. On a square foot basis, this was $67 a foot versus $72 a foot last year. We are very focused on managing our working capital needs, in relation to the business trends, and continue to maintain a strong financial position.

During the quarter, we closed 10 stores and did not open any new stores. We ended the quarter with 534 stores in operation and square feet totaling 3.6 million, versus last year’s 697 stores and square feet totaling 4.5 million. I will now turn it back to Bob to complete our comments.

Bob Higgins - Trans World Entertainment Corp. - Chairman, CEO
Thank you, John. We made progress in the first half of the year. The video category, which represents 44% of our business, had a 2% comp increase for the first half of the year. The music category, which represents 37% of our business was down 2% for the first half. With our strategies we are implementing during the third quarter, the comp trend in music should continue to improve. The initiative we implemented for these two categories have helped stabilize our sales and increase our market share despite operating 18% fewer stores than last year.

In addition, our electronics, accessories and trends categories which represent 14% of our business, had a 3% comp increase in the first half of the year. When excluding games, combined, our top three categories representing 95% of the business, had a 1% comp increase for the first half of the year. Our number one goal for 2010 is to deliver positive comps. As we move into the second half of the year, especially the fourth quarter, we expect to achieve our goal.

We continue to leverage our SG&A expenses which helped us reduce our EBITDA loss by $3.5 million in the first half of this year, versus first half of last year. As John mentioned, we ended the quarter with cash of $10.5 million, and zero borrowings on our line of credit, as compared to cash of $7.1 million, and borrowings of $28 million last year. We are moving in the right direction, and look forward to the remainder of 2010. I would now like to open up the call for any questions anyone has. Vicki or Nicky, I’m sorry.

QUESTIONS AND ANSWERS

Operator
(Operator Instructions). Our first question comes from William Meyers from Miller Asset Management. Your line is open.

William Meyers - Miller Asset Management - Analyst
Thank you. Yes. I appreciate the good work with the very slight decline in same store sales. I’m wondering if you could discuss seasonality a little bit. You do an inventory build for the holiday sales season. Does that come in the quarter we’re in or does that actually come in the same quarter as the sales?

Bob Higgins - Trans World Entertainment Corp. - Chairman, CEO
No, that will start — it will start in the third quarter. We start some minor build in September. We have a little more in October. And quite a bit more in September. And then we get to our peak level in the November period. So it actually is a stage process which allows us to manage our inventory properly.

William Meyers - Miller Asset Management - Analyst
Okay. And then you said the Blu-Ray high definition type video was a bright spot. So are you planning to build more inventory in that category or how are you seeing the various categories as you go into your second half of the year?

Bob Higgins - Trans World Entertainment Corp. - Chairman, CEO
Well, as we see from a retail point of view in the categories, if you look at music, the average price continues to come down, the same thing is true in DVD. So we don’t expect to have excess inventory or more inventory than a year ago on a store for store basis in those, and we improved our inventory management. So the key thing there is to look at how many units we’re carrying and that’s what we will be focusing on. As far as the Blu-Ray, there will be some build-up in that category, because the studios have been aggressive at building that category, and also taking down the retail price so they make it more affordable. So we think it is going to be a good category for the holiday season.