Martha Stewart Fourth-Quarter Profit Climbs
Martha Stewart Living Omnimedia profit shot up more than fivefold in the fourth quarter from a year ago amid a resurgence across its businesses which range from magazines and TV shows to home fashions.
Revenue rose to $97.04 million from $84.64 million in the year-ago period.
Analysts polled by Thomson Financial expected earnings of 25 cents per share on $95 million in revenue.
"We head into 2007 with tremendous confidence in our strategic direction, creative vitality and ability to execute on plan," Susan Lyne, president and CEO, said in a statement. "We have moved from a period of recovery to one of expansive growth, and remain focused on investing and delivering for our shareholders."
Stewart, the namesake founder, completed her prison sentence in March 2005 for lying to investigators about a stock sale. Since then, Martha Stewart Living has stepped up a number of initiatives, from new magazines to developing branded homes with builder KB Home and photo products with Eastman Kodak. The company is also preparing for the late summer launch of Martha Stewart Collection of home products that will be sold exclusively at Macy's stores.
Revenue in the publishing division rose 5% to $43.1 million, fueled by higher advertising pages and rates, led by an 11 percent rise in ad pages at its flagship Martha Stewart Living magazine and a 36 percent increase in pages at Everyday Food, which features simple recipes made from ingredients found at supermarkets. Advertising revenue alone rose 26 percent to $23.9 million. The company noted that Everyday Food achieved profitability in 2006, a year ahead of schedule.
In the company's broadcast division, revenues rose to $13.4 million from $11.0 million in the year-ago quarter. The period included a full quarter of revenue from the Martha Stewart Living Radio channel on Sirius Satellite Radio.
"The Martha Stewart Show," the company's nationally syndicated show, has been renewed for a third season in more than 85 percent of markets, the company said.
Martha Stewart's merchandising division posted revenues of $35.2 million compared to $28.1 million in the year-ago period. Sales of Martha Stewart Everyday products sold at Kmart declined in the quarter, with weakness in the home category. The company said it is refreshing the line this year. Martha Stewart added that reception for the Martha Stewart Collection from Macy's buyers has beeen positive. Meanwhile, the company plans to launch Martha Stewart Crafts line, exclusively at Michaels Stores in the U.S. and Canada in May, with independent retailers to follow later in the year.
The company's Internet division posted a 24 percent gain in sales to $5.4 million in the fourth quarter. The company plans to relaunch its Web site in the first quarter of this year.
For the year, Martha Stewart Living posted a loss of nearly $17 million, or 33 cents a share, compared with a loss of $75.8 million, or $1.49 per share, in the year-ago period. Revenues rose to $288.34 million from $212.4 million in the previous year.