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
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
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
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.