Home a bright spot for sisters HSN and Cornerstone in Q3
Home Textiles Today Staff -- Home Textiles Today, 11/2/2012 11:47:31 AM
St. Petersburg, Fla. - Strong sales growth in the home design and household as well as culinary and beauty businesses at HSN coupled with similar strides in home brands at Cornerstone were highlights for the company's third quarter, parent HSNi reported during its earnings release this week.
Net sales for HSNi, an interactive multichannel retailer, grew 7% to $778.8 million from the year ago's $727.1 million, and adjusted earnings per share were up 32% to $0.66 compared to $0.50 in the prior year. GAAP diluted EPS from continuing operations decreased 26% to $0.31 compared to $0.42 in the prior year.
Despite expected sales declines in electronics that offset the growth in home areas, the HSN segment saw its net sales increase by 5% to $537.4 million versus last year's $513.0 million, including 10% growth in digital sales. And Cornerstone's net sales took the spotlight with a 13% to $241.4 million compared to $214.1 million, including 22% growth in digital sales.
Gross profit for HSN increased 7% to $191.8 million, and its gross profit margin improved 90 basis points to 35.7% from 34.8% -- positively impacted by the product mix shift and lower transaction costs, partially offset by an increase in shipping and handling promotions.
For Cornerstone, gross profit was up 13% to $93.7 million, and its gross profit margin decreased 10 basis points to 38.8% from 38.9% in 2011 - a decline driven by an increase in promotional activity that was offset by lower return rates and lower inventory reserves.
"Our strong financial performance during the quarter demonstrates the sustained effectiveness of our overall strategy of creating immersive experiences, offering differentiated products and leveraging technology to build relationships, not just transactions," said Mindy Grossman, HSNi's ceo.
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