OK, we’re going to play it straight for a minute or two here: ShopNBC posted a 2.3 percent increase in net sales in the second quarter, to $135.2 million, the company said Wednesday.
The revenue improvement was driven by increased sales in the watch, fashion, home and beauty categories. This performance offset a decrease in jewelry category sales and an anticipated decline in consumer electronics, according to ShopNBC.
ShopNBC’s second-quarter sales lagged behind HSN and QVC, which were both up 4 percent. HSN posted $501.9 million in sales, while QVC had $1.23 billion.
“We returned the company to growth in Q2,” ShopNBC CEO Keith Stewart said in a canned statement. “To further drive customer activity, we remained focused on broadening the product mix in the categories of home, beauty and fashion. Recent customer-service initiatives are also resonating with our shoppers, delivering an improved multichannel retail experience. Looking ahead, we continue to expect some variability in operating performance as our newer product categories continue to expand.”
However, for the first six months ShopNBC’s net sales are down slightly, by 1.4 percent.
Gross profit margin decreased to 38.2 percent in the second quarter versus the prior-year period, mainly due to increased shipping and handling promotions.
The No. 3 home shopping network returned to positive adjusted EBITDA in the second quarter, achieving adjusted EBITDA of $700,000.
The company’s net shipped units increased 7 percent in the second quarter versus the year-ago period and are up 12.7 percent year to date. The average price point decreased 2.9 percent to $102 in the quarter, reflecting a higher concentration of beauty, fashion and home category sales, which typically carry lower average price points.
“Our positive adjusted EBITDA performance reflected modest revenue growth and disciplined management of operating expenses, which rose 1 percent versus last year,” CFO William McGrath said in his canned statement. “This increase reflected the impact of higher distribution costs associated with our increased home footprint, which was partially offset by reductions in our variable expenses of credit card fees and bad debt expense.”
McGrath droned on, “Our balance sheet position remains strong. The company’s cash position, including restricted cash, totaled $40 million at the end of Q2’12, compared to $45 million at April 28 (our birthday). Net use of cash in Q2 included a $4 million trademark license payment to NBC Universal and approximately $1.5 million in capital expenditures.”
What, no comments from ShopNBC president Bill Ayd?
Sorry folks, didn’t have time to listen to the analyst call yet. Too busy at our day job.