ShopNBC Posts $48 Million Loss, Sales Dip 1 Percent In 2011

Last year and the fourth-quarter were rough ones for ShopNBC, which reported its earnings Thursday.

The No. 3-ranked home shopping network saw its net sales dip 1 percent in 2012, to $558.4 million from $562.3 million.

For the fourth quarter, sales plummeted 18 percent, to $147.5 million from $178.8 million.

The home shopping network’s losses nearly doubled in 2011, to $48.1 million from $25.9 million the prior year. For the quarter, losses increased to $8.3 million from $1.4 million.

Here’s what the ShopNBC honchos had to say.

“As previously reported, Q4 results were primarily impacted by a sales shortfall in our consumer electronics business,” ShopNBC CEO Keith Stewart said in a canned statement. :Although volatility occurs in any turnaround process, we are disappointed with our sales performance in the quarter. We expect our consumer electronics business to remain challenging during the first half of the year. However, we have developed and are executing plans to help restore growth in this business segment.”

And that ain’t all.

“During Q4, we focused on significantly improving our balance sheet position and further optimizing our TV distribution footprint, which were successful initiatives announced last month,” Stewart said. “Also in the quarter, we strengthened our merchant organization with new personnel, added several high-profile national brands, and increased our digital sales penetration.”

Although on a full-year basis ShopNBC’s revenue declined, the company achieved an increase in gross profit dollars of 2.3 percent versus the prior fiscal year. Excluding the consumer electronics segment, 2011 revenue would have risen 4 percent over 2010 using the same measure.

ShopNBC reported adjusted EBITDA of $1 million, a net loss of $48.1 million, and a net loss per share of $1.03 for 2011.

ShopNBC ended the year with $35 million in cash and cash equivalents, including restricted cash, compared to the
ending third-quarter balance of $32.7 million.

“Throughout 2011, we were able to strengthen our balance sheet,” Chief Financial Officer William McGrath stated. “This process continued into the first quarter of 2012 as we secured a new $40 million credit facility. The expanded credit facility affords us added liquidity and more favorable terms, which combined with our continued focus on operational efficiency, puts us in a better position to meet our future working capital needs.”

Here are some more excuses.

“As previously announced, we also made progress in optimizing our TV distribution platform,” McGrath said. “Subsequent to year-end, three distribution agreements were renewed, representing over 50 percent of ShopNBC’s 81 million households. Two agreements were one-year extensions at comparable rates but with improvement in channel positioning. The third agreement was the early renewal of our largest TV distribution agreement. This renewal is expected to provide approximately $15 million in annual cost savings beginning January 2013, along with increased exposure via a second channel, also starting in January 2013.”


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6 Responses to “ShopNBC Posts $48 Million Loss, Sales Dip 1 Percent In 2011”

  1. StefF Says:

    right, sell more cheap s*** at a lower profit……that’ll improve your numbers… can add J.C. and still you wont do any better. Your edge has been diminished and I daresay lost….im in wonder how a company can continually run in the red and stay on the air? one of these days the numbers, cash and expenses are all going to align and this channel will be gone/bye-bye.

    not a big loss i say..did they report on their viewership? that has to be down…

    and oh, by the way, give Chuck Clemency more hours, that’ll seal this channel’s fate for sure

  2. Rick Says:

    News of SHOPnbc losing 48 million is no surprise….they screwed me out of 843.00 for a watch I returned and never got credit for it…I hope they go bankrupt…Ive never hated one company as bad as I do shopnbc….Its not the hosts I have a problem with…its the returns and credit department that is the problem…and If they would have the courtesy to contact me to resolve my issue with them then I would stop the facebook, twitter and anywhere I can post my hatred of them then I would stop it…you think they would but they really dont care….youd think the stockholders would make some changes…..somebody needs to wake them up!!!

  3. Linda Says:

    Maybe they should not have fired Mike Davidson and Charla Rhines…I don’t watch at all anymore.

  4. Linda Says:

    The best thing they ever did was fire that loud mouth Charla. She was the worst of any shopping channel host by far. Her voice, smokers laugh = yuck!

    • StefF Says:

      i think you may be in the minority here; she was pretty well liked; some didnt though; yes, she does have a smoker’s laugh and cough, STILL, unfortunately; I really liked her when she was at ShopNBC and I still like her now….she was the real deal….i think she could be a problem if she wanted to, but her sales style, i thought, as did many others, was believable….and she definitely stayed away from hype and phoniness.

  5. L Lee Says:

    If they way they treat their customers is reflected in their bottom line, so be it.

    I had a problem with a recent order (1 item of 2 not in the package) and they’re treating me like a criminal. I have to fill out a long form, including telling them about EVERY catalog/online order delivery problem I’ve had in the past 3 years. On the phone they mentioned that I’d had 2 prior issues so they’re “flagging me.” They didn’t seem to care that one of those “issues” was my receiving an order of THEIR Texas burgers that arrived completely rotten (no dry ice was ever put into the container).

    To add insult to injury, the tone of the form is borderline threatening, with LARGE reminders that lying to them is federal mail fraud.

    Needless to say, I will never order from ShopNBC again.

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