It looks like the fourth quarter last year wasn’t just tough for ShopNBC, which saw a dougle-digit decline in sales. It was no picnic for HSN, either.
Both HSN and QVC reported their fourth-quarter earnings Thursday. HSN’s sales were basically flat, only up a hair, o.4 percent, to $693.2 million. In contrast, QVC saw a 4 percent increase, to $1.8 billion.
HSN’s explanation for its lack of revenue growth: “Sales grew primarily in electronics and home design, offset by sales declines in fashion and wellness. The average price point decreased 2 percent and the units shipped increased 4 percent primarily due to mix shifts within categories.”
For the full year 2011, HSN’s net sales increased 2 percent, to $2.2 billion. Domestic QVC’s revenue increased 3 percent, to $$.41 billion.
In the fourth quarter, HSN’s gross profit increased 3 percent to $211.9 million. Gross profit margin improved 90 basis points to 33.2 percent from 32.3 percent. The margin increase was primarily attributable to decreased inventory reserves and liquidation charges, lower inbound freight costs, and lower transaction costs; partially offset by changes in product pricing and mix.
Adjusted EBITDA increased 6 percent to $79.5 million compared to $75.1 million in the prior year. The increase was due to the increase in gross profit, partially offset by an increase in operating expenses. Operating income increased 9 percent to $70 million compared to $64.2 million in the prior year.
HSN Inc. includes both HSN, the home shopping network, and Cornerstone. HSNi’s net sales grew 4 percent in the fourth quarter over the prior year, to $955 million.
“HSNi’s positive performance for the quarter and the year was a result of maintaining our focus on expanding our digital presence, deepening customer engagement and emphasizing customer acquisition and retention,” HSNi CEO Mindy Grossman said in a canned statement. “HSN ended 2011 with its largest customer file growth in four years and Cornerstone’s 12-month house file was at record levels for Frontgate, Ballard Designs and Garnet Hill. HSNi’s digital growth of 13 percent for the quarter resulted in our highest digital penetration to date of 45 percent.”