Omnimedia Endures 13% Drop, Magazines Hard-Hit
Struggling media company Martha Stewart Living Omnimedia witnessed double-digit-percentage revenue declines, given lower publishing and TV revenues in its second-quarter
Revenue sank 13% to $48 million. The company narrowed its losses slightly to $2.7 million from $2.9 million in the period because of operating cost cuts.
There were continued declines in its publishing business -- which represents the bulk of its overall revenue. Revenue fell 16% to $29 million, with publishing operating losses widening to $5 million versus $1.9 million. This segment includes magazines such as Martha Stewart Weddings and Martha Stewart Living.
Lisa Gersh, president and CEO of MSLO, stated: "We anticipated much of the weakness in publishing, and it's important to note that while our publishing strategy is gaining traction, it will take additional time to yield the targeted results. This will slow our planned return to profitability, but we continue to anticipate improving performance for the company in 2012."
Broadcasting revenues were cut down to $4.6 million versus $7.8 million -- all due to fewer new TV shows. Martha Stewart Living has an ongoing programming deal with Hallmark Channel, where shows air in daytime. Broadcasting was one of the few areas to post a profit of $536,000.
Merchandising revenues continued to represent the bulk of the good news at the company. This unit gained 12% to $14.5 million as compared to $13 million -- primarily due to improved sales of the Martha Stewart Home Office line with Avery at Staples, design fees from JCPenney and Martha Stewart Pets line at PetSmart.
Merchandising operating income grew to $10.2 million from $8.8 million.