Reconstituted Martha Stewart Living Falls Short In Q1

For the first quarter ended March 31, Martha Stewart Living Omnimedia, Inc. posted a loss across its operations, except Merchandising, the operation that covers revenues derived from sales of the company’s namesake products. Still, those profits slipped year over year.

Total operating loss for the first quarter was $2.4 million compared to a loss of $2.2 million in the prior-year frame, with basic and diluted net loss per share coming in at five cents for the period in both 2015 and 2014, the company stated. In the first quarter 2014, MSLO reported a $2 million non-cash charge to depreciation and amortization related to space consolidation in the company headquarters.

First quarter loss fell short of a published analyst average estimate of a penny in earnings.

The company’s first quarter revenues totaled $17.1 million versus $33.3 million in the 2014 period reflecting a full quarter of print and digital media operations with publisher Meredith Corp. In the deal with Meredith, the company licensed publishing of Martha Stewart Living and Martha Stewart Weddings magazines. MSLO remains a content provider, the company noted.

Merchandising revenues were $11 million of the total, down from $13.1 million in the 2014 quarter, MSLO maintained. Merchandising operating income was $7.5 million down from $9.3 million. The decline in revenues resulted from expiration of partnerships, including certain arrangements with J.C. Penney, and lower sales at The Home Depot but was partially offset by increased revenue from a new license partnership with PetSmart, the company stated.    

“MSLO begins a new era in 2015, marked by a more efficient, asset-light company focused on designing high-quality products and creating award-winning content,” said CEO Dan Dienst, MSLO. “We saw the benefits of the partnership with Meredith Corp. begin to take hold in the first quarter as reflected in a 65% reduction in publishing segment operating expenses over the prior-year period. We are fully focused on top-line growth by continuing to create our highly monetizable licensed content, and as evidenced by our new relationship with Staples and the expansion of our product line at PetSmart, Inc. Our efforts on the international front continue to move ahead as we shape plans to launch partnerships in multiple geographies abroad, consistent with our update on the fourth quarter earnings call.”