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Martha Stewart Narrows Loss as Sales Rise

Jul 26, 2006  •  Post A Comment

Martha Stewart Living Omnimedia narrowed its loss in the second quarter, beating analysts’ estimates after revenue surged on higher advertising sales at the company’s broadcast business, flagship magazine and on the Web.

The company also declared a one-time dividend of 50 cents per share, 16 months after its famed founder finished her five-month prison term for lying to federal investigators.

Shares surged Wednesday after the company reported a net loss of $8 million, compared with a loss of $52.7 million a year earlier.

Revenue rose 47 percent to $67.4 million, compared with $46 million a year earlier, and was driven by the company’s publishing and Internet businesses.

The company’s broadcast business’s sales rose to $11.8 million from $1.8 million a year earlier, helped by revenue from the syndicated TV show “Martha,” and the Martha Stewart Living Channel on Sirius Satellite Radio. The company said the daily syndicated show is registering “solid gains” in the price it charges for advertising time.

Operating loss for the second quarter decreased to $1.8 million, compared with $34.2 million for the second quarter of 2005. Adjusted earnings before interest, taxes, depreciation and amortization totaled $3.2 million, compared with an adjusted EBITDA loss of $11.2 million for the second quarter of 2005.

“Our second-quarter results confirm that the company is on very strong footing,” President and CEO Susan Lyne said in a statement. “Publishing and Internet delivered significant increases in advertising revenue, while broadcasting performed well and was a strong driver of demand for our brand.”