ShopHQ, recently under new management, posted second-quarter net sales of $156.6 million, up 5 percent compared with the year-ago period, the No. 3 home shopping network said Wednesday. The Minnesota-based channel has new offices in Manhattan now, by the way.
ShopHQ’s growth in the second quarter was greater than QVC’s, but less than HSN’s. Industry leader QVS saw a 3 percent jump in revenue, to $1.4 billion. HSN’s net sales rose 6 percent, to $556.5 million.
ShopHQ CEO Mark Bozek
ShopHQ’s quarter was boosted by strong performances in the fashion and accessories, beauty, and health and fitness categories.
The CEO who replaced Keith Stewart, HSN vet Mark Bozek, had this to say.
“The company delivered solid second-quarter results with strong growth in total customer counts and increased order volume on mobile devices,” Bozek said in a canned statement.
“I am excited to be leading the company into a new phase of growth while working alongside our newly formed board and a dedicated and re-energized employee base.”
At ShopHQ gross profit dollars increased 9 percent to $60.4 million, as gross profit as a percent of sales for the quarter improved to 38.6 percent, compared to 37.5 percent a year ago.
Adjusted EBITDA increased to $5.5 million in the second quarter versus $3.8 million last year, driven by the company’s sales and gross profit improvements.
Adjusted net income was $800,000, or one cent a share, compared to an adjusted net loss of $800,000 in the second quarter last year.
“Our commerce platforms, led by our reach into 87 million TV homes in the U.S., are unique assets that provide us with tremendous potential,” Bozek said. “Driving growth will largely be centered around attracting and building a diverse portfolio of proprietary brands and products with the goal of growing our customer base.”
“We will be focused on supporting the growth of these proprietary brands with immersive, personality-driven programming that is designed to drive greater engagement and social commerce on all our platforms,” ShopHQ’s new honcho said.
“Our process is all about an evolution of the business — not a revolution,” Bozek said. “Our recently established office in New York City should aid us in all these efforts. I plan to elaborate more on our new vision for the company in the coming months, as we begin to execute on our strategy of a more fully leveraged multichannel commerce platform.”
Chief Financial Officer and Executive Vice President William McGrath, who seemed to have escaped the ax under the new regime, had this to say.
“We ended the quarter with $23 million in cash and restricted cash compared to $27 million at the end of Q1’14,” McGrath said. “Net use of cash includes $5 million in working capital and $3 million in capital expenditures, partially offset by Adjusted EBITDA of $6 million in the quarter.”