Martha Stewart Living Reports Weaker Third-Quarter Financials
The lifestyle media company's broadcasting unit posts a revenue drop, but swings to a small operating profit.
Lifestyle media company Martha Stewart Living Omnimedia on Friday reported lower third-quarter financials amid continued weakness in its broadcasting and publishing businesses, which it is restructuring.
The company's net loss of $50.9 million, which included a $44.3 million non-cash impairment charge for the writedown of goodwill related to its publishing segment that has seen weak advertising trends, compared with a year-ago loss of $9.7 million. Its operating loss of $50.7 million compared with a year-ago loss of $9.3 million.
Revenue of $43.5 million was down from $52.2 million in the same quarter of 2011 due to lower revenue in the publishing and broadcasting segments, partially off-set by higher merchandising results.
"Our performance in the quarter was in line with our expectations but not our ambitions for the company," said president and CEO Lisa Gersh. "Including the publishing segment actions announced yesterday, we have taken actions designed to significantly reduce the cost structure of our print and broadcasting operations this year, an important step toward positioning MSLO for profitable growth."
She added: "We are transitioning our content operations to digital, mobile and video platforms that feature lower fixed costs and align with evolving consumer preferences for how and where they engage with our content."
And Gersh said the company has been seeing "some encouraging early results, particularly in video."
Broadcasting revenue in the third quarter amounted to $2.7 million, less than half the $6.6 million recorded in the comparable quarter of 2011. "The decline reflects the company's strategic migration of its broadcasting business away from the higher costs associated with daily live television production in favor of investment in short-form video for digital formats and targeted broadcast initiatives," the firm said.
But the broadcasting division swung to an operating profit of $300,000 after a year-ago operating loss of $1.3 million.