Martha Stewart swings to loss as merchandising slows
February 25, 2009,
New York – Martha Stewart Living Omnimedia faces deeply reduced licensing revenues in 2009 even as it fights uphill in the slumping consumer economy, two factors already reflected its fourth quarter and full year 2008 results reported today.
The main falloffs were due to lower licensing monies from the Kmart exclusive Martha Stewart Everyday program, and from pulling the plug on Blueprint magazine.
In the merchandising segment, Q4 revenues crashed from $49.8 million in ’07 to $13.9 million in ’08: a 72.1% reduction. Full year 2008 saw merchandising volume of $57.9 million, a 31.6% drop from $84.7 million in 2007.
In the key soft side replacement program for the merchandising division, MSLO cited “cookware, gadgets and luxury bedding” as the top-selling categories in the Martha Stewart Collection at Macy’s during the fourth quarter ended December 31.
In the quarter, MSLO posted a net loss of $8.0 million, or 15 cents per diluted share – a reversal from net earnings of $33.3 million, or 63 cents EPS one year ago.
For all of 2008, the net loss of $15.7 million, or 29 cents EPS, contrasted with 2007 net income of $10.3 million, or 20 cents EPS.
MSLO hopes to drive new merchandising revenue from its expanding Chef Emeril Lagasse unit, from deals with partners like 1-800-FLOWERS.com, and by replacing such businesses as the Martha Stewart outdoor furniture line at Kmart, for which a new licensee has yet to be named. February 2010 will bring the termination of the Kmart exclusive
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