HSN ended last year with a slight increase in revenue, posting a 2 percent gain in net sales in the fourth quarter, to $697.4 million, the home shopping network said Thursday.
“Sales grew in health, beauty and apparel & accessories, offset by lower sales in jewelry, culinary and electronics,” HSN said in a press release. “Net sales were favorably impacted by lower than historical returns in many product categories. The average price point increased 1 percent while the units shipped remained unchanged.”
For the full year 2013, HSN’s net sales were up 2 percent, to $2.31 billion.
“Throughout 2013, we successfully managed the company to position us for long-term growth,” HSN CEO Mindy Grossman said in a canned statement.
“We kept our focus on the customer, emphasized our unique content and proprietary products, strengthened our digital platform, further leveraged opportunities and synergies across the HSN and Cornerstone brands and returned value to our shareholders by delivering nearly $200 million through share repurchases and cash dividends,” she said.
In the fourth quarter, HSN’s digital sales increased 7 percent, with penetration rising to 39.5 percent.
Gross profit rose 3 percent to $230.6 million. Gross margin increased 20 basis points to 33.1 percent, primarily due to lower inventory reserves. Operating expenses (excluding non-cash charges) increased 1% to $142.6 million and were 20.4 percent as a percentage of net sales compared to 20.6 percent in the prior year.
Adjusted EBITDA increased 5 percent to $88.1 million compared to $84.0 million in the prior year primarily due to the 2 percent increase in net sales and the 20 basis point increase in gross margin, partially offset by an increase in operating expenses.
Operating income saw a 4 percent gain, to $77.9 million compared to $74.7 million in the prior year.
For HSN Inc., which includes the home shopping network and the Cornerstone unit, net sales grew 4 percent over the prior year to $1 billion.
“During the fourth quarter, we achieved 4 percent sales growth and a digital sales increase of 8 percent, including mobile growth of 59 percent,” Grossman said. “Adjusted EPS (earnings per share) growth for the quarter and year were 11 percent and 19 percent, respectively. We also ended 2013 with record customer levels at both HSN and Cornerstone.”