HSN’s sales saw a 2 percent uptick in the first quarter, to $550.1 million, versus the year-ago period, the home shopping network reported Thursday.
Sales grew in apparel & accessories, beauty and home design, but that was offset by lower sales in jewelry and electronics, HSN said. The average price point decreased 9 percent, the units shipped increased 12 percent and the return rate increased 70 basis points to 20 percent primarily due to changes in product mix, according to HSN.
Digital sales increased 4 percent with penetration increasing 80 basis points to 35.7 percent.
However, digital sales “were tempered by the launch of the digital site redesign across all HSN digital platforms that occurred early in the quarter,” the company said.
In other words, we hated the new website!
“In addition, last year’s results included one extra day versus the current year because of leap year,” HSN said.
Gross profit increased 2 percent to $192.4 million and gross margin increased 20 basis points to 35 percent. The margin was favorably impacted by the product mix shift, partially offset by an increase in shipping and handling promotions.
Adjusted EBITDA increased 3 percent to $58.9 million compared to $57.3 million in the prior year. Operating income increased 2 percent to $48.6 million compared to $47.5 million in the prior year.
Sales for HSN Inc., which includes both the network HSN and the Cornerstone unit, increased 7 percent, to $772.7 million.
“I’m pleased with HSNi’s first quarter performance and the progress we made in creating a powerful and differentiated retail experience,” HSN CEO Mindy Grossman said in a canned statement.
“Across HSNi, we continue to reach and engage customers through content-rich, immersive experiences on multiple digital platforms,” she said.
“These efforts contributed to sales growth of 5 percent and digital sales growth of 10 percent. We also had EPS (earnings per share) growth of 24 percent and returned value to shareholders through our share repurchase and cash dividend programs that included purchasing approximately 1.2 million shares during the quarter.”