Home Shopping Drives HSN Inc.
Q3 Adjusted Cash Flow Rises 30%
by Mike Farrell -- Multichannel News, 11/12/2009 1:42:45 PM
Total sales fell 5% in the third quarter at home-shopping giant HSN Inc., dragged down mainly by declines at its Cornerstone Brands catalog business, but cash flow soared 30% fueled by strong performance at its HSN shopping network.
HSN CEO Mindy Grossman: “We’re optimistic going into the fourth quarter.”
Total revenue was $641.2 million, down 5% from $672.3
million. At HSN, total sales were down 1% to $467 million and at Cornerstone,
sales dipped 13% to $174.2 million. Adjusted earnings before interest, taxes,
depreciation and amortization (EBITDA, a measure of cash flow) was up 30% to
$48.8 million, mainly due to a 32% increase at HSN to $47.1 million, which
offset a 12% decline at Cornerstone.
HSN also made progress in its ongoing efforts to lower the average price point of its products, dropping 6% to $56.25 from $59.66 a year earlier.
In addition, shipped units increased by 6% in the period and return rates improved by 80 basis points due to improved product quality, apparel fit initiatives, and lower price points. HSN.com's net sales grew 7% over the prior year and sales from e-commerce represented 29.8% of HSN's total net sales, up from 27.6% in the prior year.
On a conference call with analysts Thursday, HSN CEO Mindy Grossman said that third-quarter sales momentum is expected to continue.
"We're optimistic going into the fourth quarter and are seeing the trends continue," Grossman said on the conference call.HSN Minds The Store
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