Ad sales down at Martha Stewart Living

But consumer home focus in weak economy bodes well

NEW YOUR -- Martha Stewart Living Omnimedia gave weaker than expected full-year guidance Tuesday amid sluggish traditional ad trends.

But MSLO executives said the firm's cross-media ad packages are doing well in this environment, and they expect demand for its products will benefit from consumers' likely recession time focus on their homes.

The company reported results as the Conference Board said U.S. consumer confidence plunged to 38 -- below expectations and a record low since its launch in 1967 -- for the month of October from 61.4 in September. The previous low was set in Dec. 1974 at 43.2.

MSLO, founded by domestic doyenne Martha Stewart, reported a third-quarter operating loss of $3.5 million, including one-time expenses -- better than the year-ago loss of $4.9 million.

Quarterly revenue declined 4% over the year-ago period to $66.5 million, but the company said a lower headcount and other cost reductions helped its bottom line. Digital ad revenue rose 35%, but publishing ad revenue was down in the double-digit percentage range -- a trend that continues in the current fourth quarter.

For the full year, the company forecast revenue of about $295 million, below the average estimate of $300.7 million.

Given consumers' likely home focus in a weak economy, MSLO Co-CEO Robin Marino said: "We do feel we're in a good position."

Co-CEO Wenda Harris Millard said marketers' demand for integrated ad packages should also help the company in a tough economy.