Martha Stewart nears quarterly profitability
July 26, 2006-- Home Textiles Today,
New York – Martha Stewart Living Omnimedia (MSLO) reported second-quarter operating loss of $1.8 million, dramatically narrowed from the $34.2 million loss for the same period a year ago.
The company said loss per share from continuing operations was $0.01 for the second quarter of 2006, ahead of a prior year second-quarter loss of $0.65 and ahead of the consensus estimated loss of $0.16. Revenues rose 47.0% to $67.4 million compared to $46.0 million for the second quarter of 2005.
Susan Lyne, president and ceo, said publishing and Internet were the leading business segments, noting that advertising revenues were the key driver in the improving performance.
In the merchandising segment, revenues were $10.2 million for the second quarter of 2006, as compared to $10.2 million in the prior year's second quarter. Acting cfo Howard Hochhauser said comp-store sales for Martha Stewart Everyday at Kmart were down 4.6%, with year-to-date sales there down less than 1.0%. His projection for the third quarter saw $8.5 million in merchandising revenues, primarily generated by licensing fees.
In response to an investment analyst’s question, Lyne noted that the new licensed home program with Macy’s has the operational potential for “70.0% margins,” essentially the same as for the Kmart program.
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