MSLO remains focused on Martha launch at JCP in Q1 2013
HTT Staff -- Home Textiles Today, 7/30/2012 10:38:40 AM
New York - Aside from sharing its second quarter results, Martha Stewart Living Omnimedia was quick to use its conference call this morning to reaffirm its partnership and plans with JCPenney amid the company's legal actions with Macy's.
In just over one minute into her opening remarks, president and ceo Lisa Gersh said the company wanted to discuss its recent developments with respect to JCPenney.
First she noted MSLO's "substantial expansion of the commercial partnership, including additional product categories and an increase in the minimum guarantee." The company will now receive "a minimum of about $288 million over the course of the 10-year agreement - an increase of $110 million from what was originally planned," she said.
Gersh added that "the opportunity to amend this agreement has been in place since the beginning. The decision to act on it now is a reflection of the great opportunities we and JCP see as the relationship builds."
The second development stems from the litigation underway with Macy's, she continued, reiterating the court's July 13 granting of Macy's request for a preliminary injunction with respect to certain categories of products.
"I want to take the opportunity here to clarify a few facts about this ruling and how it relates to our business both with Macy's and JCPenney," Gersh went on.
Firstly, MSLO will be launching our products both in store and online with JCPenney in the first quarter of 2013 as planned.
"Nothing about this ruling changes that," Gersh urged. "This case is primarily a contract dispute over how certain products are branded and sold, not about the validity of the partnership with JCPenney."
Secondly, the minimum guarantee under the JCPenney commercial agreement, including recent increase, "is not directly affected by the ruling," she added. "We are planning to be in JCPenney stores with a wide array of products for consumers early next year. And we are in ongoing development of categories and products, as we typically are with all of our partners."
Later in the call, during the question-and-answer session, Gersh responded to further queries about the Macy's matter.
"It is not a final ruling," she said, later adding, "We have not had an order settled by judge yet. So it is premature for me to make further statements other than [my prepared remarks]."
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