HSN Founder’s Widow Wins $34M From Morgan Stanley, Goomah

Here’s a juicy story we totally missed last week: Morgan Stanley was ordered to pay more than $34 million to the estate of Home Shopping Network (that was its name back in the day, not HSN) founder Roy Speer.

The financial firm and several of its executives, who included Speer’s alleged one-time mistress, were accused of making unauthorized trades on his account, according to several media reports.

http://www.wsj.com/articles/morgan-stanley-ordered-to-pay-over-34-million-to-hsn-co-founders-estate-1458600079

http://www.home.tampabay.com/news/business/widow-of-hsn-co-founder-roy-speer-awarded-34-million-in-suit-against-his/2270228

http://www.bloomberg.com/news/articles/2016-03-21/morgan-stanley-told-to-pay-34-million-to-hsn-founder-s-estate

The charges were made by Speer’s widow Lynnda (yes, two “N”s), who got her big arbitration award from the Financial Industry Regulatory Authority. Morgan Stanley has to fork over $32.8 million in compensation and interest and $1.55 million in other reimbursements as well as legal fees.

According to the Tampa Bay Times story on the case, Morgan Stanley financial advisor Ami Forte was the Speer’s former “goomah,” as we’d say in New Jersey and on “The Sopranos.” Forte and another Morgan Stanley exec, Terry McCoy, were guilty of “elder exploitation,” fraud, making authorized trades, and breach of fiduciary duty.

Speer passed away in 2012 when he was 80, and he was a rich guy. At one time he was worth more than $1 billion and was on Forbes 400 list of richest Americans.
Morgan Stanley and stock broker Forte handled Speer accounts ranging from $150 million to $200 million, the Tampa Bay Times reported. The paper said that there were more than 12,000 unauthorized trades on his account during the last five years of his life.

Lynnda was wed to Speer for 52 years.

The widow also has a suit pending in Florida against Forte over a condo in the Cayman Islands that was transferred to her.

Evine Live Makes $5 Million In Layoffs, Cutbacks

It’s late and we’re tired, but we’re reading a transcript of Evine Live’s fourth-quarter earnings call with Wall Street analysts on Wednesday. See what we do for you guys! Anyway, we’ve already seen a bit of a bombshell.

In the transcript, provided by Seeking Alpha, CFO Tim Peterman said, “Last week, we enacted a reduction in workforce and other related costs that will result in approximately 5 million in annualized expense savings. We will continue to look for more ways to make our business more efficient.”

http://seekingalpha.com/article/3960623-evine-lives-evlv-ceo-bob-rosenblatt-q4-2015-results-earnings-call-transcript?part=single

Interim CEO Bob Rosenblatt, who took over for ousted chief Mark Bozek, said that 45 full-time employees were laid off. We wonder if Connie Kunkle’s “early retirement” was related.

“It is mostly a matter of being able to be more efficient and more effective in terms of streamlining the organization and most of the positions were in corporate, that we took the positions out of,” Rosenblatt said according to Seeking Alpha’s transcript.

“And they ranged in high-level positions all the way down since it was 45 positions all the way down to staff positions but it was done in surgical manner and of course some other people that remain having the additional responsibilities.”

Rosenblatt also indicated that he had no plans of transforming Evine Live from a watch network, saying that the category distinguishes the channel.

He said that sales in beauty were especially strong, with brands such as Consult Beaute doing particularly well.

“On the jewelry side, we made a deliberate decision to reduce airtime which boosted productivity for the category,” Rosenblatt said. “Sales were down versus the fourth quarter of prior years, but I’m happy to report that the jewelry area continues to be one of our customers’ favorite categories.”

That’s right, Bob!

“Within the categories we experienced particularly strong sales in the following area,” he said. “Gems en Vogue, we had sales of over 11 percent; luxury diamond designer brands in general were over 104 percent. Our gemstone designer brands were up to 2 percent and our sterling silver sales were up 20 percent.”

Evine Live sold a lot of Hoverboards during the holidays, and then stories broke about the boards erupting in fire and users suffering a lot of injuries. Rosenblatt addressed that issue.

“We’re mindful of the continued situation regarding the Hoverboard products and we’ll continue to monitor the situation as our customer safety is always a prime concern of ours,” he said. “However, as you know Hoverboard’s only represent one of more than tens of thousands of products that we offer at Evine Live and as retailer these occasional issues are not unexpected.”

Evine Live’s Fourth-Quarter Sales Up 5 Percent, Operating Income Drops

Evine Live’s net sales rose 5 percent in the fourth quarter last year, to $211.5 million, but operating income dropped precipitously, to $1.6 million from $3.9 million in the prior-year period, the company reported Wednesday.

Operating expenses also increased, up $3.1 million to $64.8 million, and was driven primarily by increased program distribution and increased variable expense.

Earnings per share dropped to one cent, which includes distribution facility consolidation and technology upgrade costs. EPS for the prior fourth quarter was six cents, which included executive and management transition costs.

Consumer electronics was the fastest-growing category at 35 percent of net sales versus the prior-year period, followed by the beauty category at 23 percent and fashion at 3 percent; jewelry and watches declined by 2 percent and home declined by 11 percent.

The return rate for the quarter was 18.9% percent,an improvement of 100 basis points year-over-year.

Chairman and Interim CEO Bob Rosenblatt, who replaced ousted Mark Bozek, had lengthy comments in the press release.

Although the Company had solid revenue growth in the fourth quarter, we are disappointed with the overall bottom line results. e profit erosion that continued into our fourth quarter doesn’t reflect the merchandising balance and operational discipline necessary to deliver consistent growth in value to all stakeholders.

We are in the midst of implementing plans to address these issues, but we are mindful that it will take some time to fix them in the right way. Last week we took our first steps toward addressing these issues and cut our full-year operating expense by $5 million through a reduction in corporate overhead and other operating costs.

Evine Live has a proven business model and we are strongly positioned to continue to use our expertise as a leader in the digital video commerce space. Our historical focus on developing proprietary and exclusive brands to broaden our product offering is proving to be a good idea.

However, it is only one piece of a much broader business strategy that is required to create profitable results and to build shareholder value. Our work going forward is centered on building a cohesive merchandising strategy with clear accountability.

With the $17 million bank term loan from GACP Finance Co., LLC, our recently strengthened balance sheet provides the Company some additional flexibility in building long-term relationships with our vendors, as well as the ability to be more opportunistic in the broader marketplace.

For 2015, sales were up 3 percent to $693.3 million, with operating income in the negative column at $8.7 million from a positive $1 million in 2014.

Consumer electronics was the fastest-growing category at 29 percent versus the prior year, followed by beauty at 14 percent and fashion at 10 percent; jewelry and watches declined by 3 percent and home declined by 9 percent.

The return rate for the year was 19.8 percent, an improvement of 170 basis points year-over-year.

Vanessa Williams Has A Hit With Her Evine Live Line

Singer-actress Vanessa Williams’ debut on Evine Live last weekend was a hit, according to the home shopping network, which reported that she sold out of many items in her clothing line and exceeded sales goals by 10 percent.

We wouldn’t normally believe such hype, but we tried to buy one of her ruched skirts the morning before her premiere and it was already sold out, so we know she was cooking.

“I’m thrilled that my new clothing line exclusively for Evine Live was so successful in its debut,” Williams said in a canned statement. “I’m elated that so many customers are excited to be draped in my spring fashion. A warm thanks to everyone that made the huge success possible.”

Vanessa Williams

“Vanessa was absolutely amazing to work with throughout the entire process from initial meeting to launch,” Evine Live Vice President of Fashion David Miller said. “She was in the details, even bringing a collection of shoes for her specifically chosen models. She was a pro, walking the catwalk with her models and even changing her outfits in the middle of the show as product sold out.”

The collection was featured during the network’s Spring Unleashed: Fashion Day event, where Williams reportedly shared her “Urban Camouflage” design philosophy, “clothes that conceal pesky imperfections and make every body type look its best,” according to the press release .

“Vanessa Williams is a great addition to the Evine Live family where we have welcomed other amazing brands and personalities over the last few years, including Paula Deen, Nancy O’Dell, Beekman 1802 and Michelle Williams,” Evine Live Chairman and Interim CEO Bob Rosenblatt said. “She clearly understands our multichannel platform and was able to harness her message to women everywhere and they responded in droves.”

Vanessa Williams will return to Evine Live on May 1 to present new styles in her V. by Vanessa Williams collection.

QVC Guru Isaac Mizrahi Featured At Jewish Museum

QVC’s design maestro, Brooklyn-born Isaac Mizrahi, is the centerpiece of a new exhibit at the Jewish Museum in the Big Apple. And “Isaac Mizrahi: An Unruly Past” has gotten a lot of press in New York, including several stories in The New York Times.

The articles we’ve seen mention up top the fashion designer’s work for QVC, as well as the collection he used to do for Target, which we loved.

The current exhibit, however, focuses on his high-end clothes. The stories are an interesting read.

Paula Deen Cooks Up Clothing Line For Evine Live

Well bless her heart: Paula Deen is doing a clothing line for Evine Live.

The home shopping network Tuesday announced that it will premiere “Paula Deen’s Closet” on April 11 and 12.

“Paula Deen, a culinary icon, author of 14 cookbooks and restaurateur, is bringing her Southern charm and savory personality to Evine Live with an exclusive clothing collection inspired by her personal wardrobe,” the press release said.

There was a canned quote from Deen, who got in hot water for racial comments she made years ago.

“If there’s one thing I love more than cooking, it’s clothing,” Deen said. “Whether I’m at Evine Live, on the set of my cooking shows or just stopping by one of my restaurants for an order of Savannah crab cakes, people always seem to be asking, ‘Paula, where did you get that outfit?’ I can’t wait to start telling them, ‘at Evine Live, ya’ll!’”

“Paula Deen’s Closet” builds “on the success of her exclusive home, kitchen and pantry collections,” according to the press release.

Debuting on the heels of “Paula Deen’s Home” this past weekend, the collection “will feature a number of sophisticated and colorful pieces, including jackets, bottoms, dresses and more,” the press release said. “Reflective of Paula’s personal style, the soft, flowy and comfortable designs showcase bright prints, lace details and more.”

And finally, a quote from one of the few Evine Live execs left standing, Chief Merchandising Officer Penny Burnett.

“Since joining Evine Live last year, Paula Deen has become a regular face on our network and a beloved member of our family,” she said.

“We’re thrilled to continue expanding Paula’s brand and sharing her sophisticated style with viewers. While not widely known, Paula is actually quite the fashionista. In fact, her personal wardrobe is so large that she had to install a moving dry cleaning rack inside her closet. With the debut of this new collection, fans will have the opportunity to step inside Paula’s closet and experience her savory sense of style for themselves.”

Veteran Evine Live Host Connie Kunkle Exits

We noticed several new hosts, women of color, in the past two days on Evine Live and now we know why: The net needed to fill in its ranks now that veteran host Connie Kunkle has left the house.

A kind Facebook friend gave us the heads-up about Kunkle’s “early retirement.”

The home shopping network posted the news on its own Facebook page.

https://www.facebook.com/search/top/?q=evine%20live

EVINE Live Host Connie Kunkle wanted to share the following message with all of her fans:

“It is with a sad heart that I inform my EVINE Live customers, coworkers and friends, that I am leaving my position as an On-Air Host and taking early retirement. I have thoroughly enjoyed my time with the company and my interactions with its loyal and loving customers. I will miss the encouragement and friendship from this community. I appreciate your support, and I will miss each of you. A special thank you!”

We want to sincerely thank Connie for all the smiles and laughter she has brought to us and her viewers over the past 11 years. We wish her all the best as she starts this new phase in her life and will miss her dearly. Take a trip down memory lane and enjoy a few fun clips of Connie over the years plus share your favorite Connie memory in the comments below.

Here is Kunkle’s bio from Evinelive.com.

Connie Kunkle has hosted television shows about home decorating, cooking and finance in addition to hosting talk shows. She became an at-home shopping host in 1996, and in 2004 joined Evine Live, where she became the go-to woman for everything from jewelry and fashion to beauty and home décor. Connie loves connecting with viewers and talking about products with them.

When not behind the camera, Connie can often be found on stage singing. She has performed around the world, including Carnegie Hall and the Royal Albert Hall in London. With unending energy and a zest for life, Connie enjoys golfing, knitting and adventure travel–and she loves sharing her stories on air with viewers.

“I love the variety of products here at Evine Live–no two days are alike! It really keeps us on our toes.”

The hosts that we saw for the first time recently, maybe we have just missed them before, are Fatima Cocci and Sam Simmons.

Cocci’s bio:

Fatima became part of the Evine Live family in 2007 as a favorite model and guest. She is excited to have recently joined the dynamic and fun-loving host team. As a self-proclaimed “true Gemini,” she loves to be involved in the amazing variety of products offered here and is always looking to dive into the next hot project.

While the Evine Live family grows daily, her own family is also growing with the arrival of a baby boy this year. Fatima is happy her stepson will now have a partner in crime to buddy with.

Fatima’s background includes everything from sales, to owning her own real estate brokerage, to teaching Latin dance professionally. The common thread has always been her love of being social and connecting with people.

“I am thrilled to have an opportunity to bring the awesome products we have at Evine Live to life. I am also delighted to share my passion for life, dance, and travel with all of our fabulous viewers.”

Simmon’s bio:

Sam joins the Evine Live family after a 15 year TV career that has taken her all over the world. Beginning her career in the control room at BBC news it wasn’t long before she was invited to step in front of the camera as both host and model. “I love to travel for work but moving to Minnesota for Evine Live is totally life changing. It was too good an opportunity to miss!”

Outside of the studio Sam is passionate about yoga, personal growth and is a trained life coach. Her motto is, “Rock what you’ve got!”

HSN Gets ‘Chopped’ With Food Network

We always love it when HSN unveils news about its culinary products, because we know they will save us a lot of money. That’s because we’re not going to spend a dime on pots, pans, etc.

We haven’t turned our oven on in more than a year, no joke.

It was much bluster that the No. 2 home shopping network announced a number of new food experts coming on board. It’s fitting that we have never heard of most of these folks, since we avoid food-competition reality shows like the zombie plague.

Long story short, HSN has forged partnerships involving two Food Network hit shows, “Iron Chef” and “Chopped.” And Oprah Winfrey’s personal chef is in the mix.

The network is holding a 24-hour “HSN Cooks” event on Sunday, where it will launch celebrity chef Anne Burrell and the premiere of its first culinary series featuring “Iron Chef” Donatella Arpaia — “The Saturday Morning Market with Donatella.”

In its press release, HSN said it was starting its own farmer’s market with that cooking series debuting April 2.

“Donatella will highlight in-season ingredients while showing customers how to incorporate them into recipes at home,” the release said.

“The new series will also serve as a platform to introduce new celebrity chef partners and innovative food brands to HSN’s impressive roster. Esteemed celebrity chef and restaurateur Geoffrey Zakarian will kick-off the series on April 2, alongside Donatella Arpaia, with the debut of his latest cookbook, ‘My Perfect Pantry.'”

The “Cooks” event will feature Curtis Stone, “Restaurant: Impossible” host Robert Irvine, and “Bionic Chef” and Montana Mex founder Eduardo Garcia.

And in a first, HSN customers will be chosen to join each chef on-air for a personal cooking lesson during the live event. We don’t think we’ll be asked to be on.

Just sayin’.

Stone will lead the first interactive cooking lesson at 10 a.m., followed by Irvine at noon and Garcia at 5 p.m.

The Cooks event will also feature the launch of former personal chef to Oprah Winfrey, Art Smith, who will be introducing his Smartbowl system; food editor of ABC’s “Good Morning America,” Sara Moulton, who will be preparing recipes from her latest cookbook “Sara Moulton’s Home Cooking”; and celebrity chef and restaurateur Graham Elliot will debut his cookbook “Cooking Like a Master Chef.”

HSN is debuting “Food Network star” Anne Burrell March 18. Her Corvex Collection features a line of professional, chef-grade cookware with a double-coated ceramic non-stick interior.

In partnership with “Chopped,” HSN will launch an exclusive line of “Chopped”-branded kitchen tools on May 6 and 7. It was feature “Chopped” alum Marc Murphy.

Evine Live Gets $17 Million Loan

We guess we’re not the only one having “liquidity” issues.

Evine Live said Thursday that it had secured a 5-year bank term loan with GACP Finance Co. for $17 million.

The home shopping network said that expects “to use the borrowings for general corporate purposes as well as to strengthen the overall liquidity position of the company.”

The loan matures in March 2021.

“For 2016, our primary focus is to improve our execution on the fundamentals of our business, both from a profitability perspective as well as from a balance sheet perspective,” Evine Live Chairman and Interim CEO Bob Rosenblatt said in a canned statement.

“This incremental liquidity is part of our integrated plan to ensure we have the flexibility to be opportunistic with our business operations in order to drive improving profitability and value for all of our stakeholders. In addition, we are reiterating our preliminary fourth-quarter results.”

The network will release its fourth-quarter and 2015 results March 23 before the market opens and will hold a conference call at 8:30 a.m. to review these results.

Hot Off The Press: Stars Are Selling On QVC

Here’s a hot scoop for you: Celebs are selling products on home shopping networks!

Who’d a thunk such a thing?

You’re not surprised? Well, we guess you don’t work for the New York Daily News.

The tabloid run a puff piece on QVC Sunday with the headline “Shopping Network Lures Celebs: A Who’s Who On The ‘Q'” about famous names hawking their wares in West Chester, Penn.

http://www.nydailynews.com/new-york/celebrities-trading-nyc-qvc-shopping-network-article-1.2554174

QVC vendors Dennis Basso, Lisa Rinna, Jill Martin and Brad Goreski, creative director for the newly revived C. Wonder line, are quoted in the piece, and even posed together for a photo.

“This is where the cool kids hang out,” Rinna told the News, referring to the home shopping network.

The most interesting tidbit to us was that Martin, the “Today” correspondent, sold 50,000 G.I.L.I. wrap belts on day. We think it was a TSV.

HSN, which is really overladen with celebs, must be burning that it wasn’t included in the story.