Posts Tagged ‘HSN’

Kirks Folly, Marianna Jacobs, Somers and Brand

September 18, 2017

We’re behind on our blogging, been busy at work, but here are some tidbits and observations.

Kirks Folly will be bringing its whimsical fairy dust, jewelry and home décor back to QVC on Sept. 29. The line, which beacons the angels among us, is either the silliest thing you have ever seen or something you fanatically love. Jenniefer Kirk posted on Facebook about her return.

Back in the day Jenniefer and then-QVC host Judy Crowell would get dressed up in elaborate outfits, and sell Kirks Folly from an elaborate set. Don’t know if we’ll be seeing that again.

Sterling silver designer Marianna Jacobs and her husband Richard have been on several home shopping networks selling their handmade jewelry. Most recently they did a stint on Evine before joining HSN.

Marianna was on HSN host Colleen Lopez’s “Designer Gallery” show on Sunday with her Travelers’ Journey line and it looked like she had a makeover. She was totally glam – blown-out hair, tailored attire, totally different that her former free hair, casual hippy kind of look. And her husband Richard isn’t mentioned, as far as we could tell. They used to appear on-air together. What’s up?

We briefly saw Suzanne Somers – who sent from HSN to Evine to QVC — recently with QVC host Rick Domeir. We thought she looked good as she touted her new book, which in part touts her long-term marriage. Our mom thought Somers looked terrible. We will tell you what was terrible: The way Domeir was fawning over her.

By now we all know that HSN, in advance of Hurricane Irma, let its employees go off the safety and packed up a crew to televise from makeshift studios in Nashville, Tenn. We have seen a promo several times now where our buddy Bill Brand, HSN’s president, thanked viewers for their good wished and prayers. With Mindy Grossman’s exit to join Oprah Winfrey’s Weight Watchers leaving a vacuum at the top at HSN, Brand may be her replacement.

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Hurricane forces HSN to air from Tenn.

September 10, 2017

A tip of the hat to HSN for shutting down its operations in St. Pete because of Hurricane Irma.

Like a number of businesses in the Tampa, Fla., area that are in the hurricane’s path, the No. 2 home shopping network closed up shop for the safety of its employees.

http://www.tampabay.com/news/business/retail/businesses-throughout-tampa-bay-shut-down-early-as-hurricane-irma-nears/2336658

We are watching HSN now at 10:30 p.m. EST, and it is airing past broadcasts.

But it will be telecasting from the facilities it has in Tennessee, as it told folks through its Twitter feed.

“Our FL campus is closed,” the tweet yesterday said. “Employees & partners are focused on families. Team in TN will cont live broadcast at midnight. If in FL, stay safe!”

We have a lot of friends now in Florida, not to mention our brother (who has opted not to evacuate), and we pray they are all safe and the storm isn’t as fierce as predicted.

Evine 2Q Sales Down 5 Percent, To $149 Million

August 24, 2017

Evine became the third home shopping network to see its sales drop in the second quarter, with them dipping roughly 5 percent to $149 million, the company said Wednesday.

Evine also has a net loss of $2 million, flat year-over-year, and with adjusted EBITDA of $3.5 million.

http://s21.q4cdn.com/129019908/files/doc_presentations/2017/q2/Evine-Earnings-Presentation-F17-Q2.pdf

QVC’s parent, Liberty Interactive Corp., already reported reported that the No. 1 home shopping network saw its second-quarter revenue drop 4 percent, to $1.37 billion. And HSN suffered a 4 percent drop in its second-quarter sales, to $532.2 million.

“This second quarter is the final quarter of expected revenue decline, which was related to the year-long re-balancing of our consumer-electronics mix of business that began in April of last year,” Evine CEO Bob Rosenblatt said in a canned statement.

“This re-balancing was an important step to position our merchandising offering for long-term profitable growth and we accomplished it while again delivering on our quarterly EPS [earnings per share] guidance.”

Rosenblatt then crowed about some launches that the network has coming up.

“When we combine this progress with the launch of more than 10 million high-definition homes and the launch of our high-definition signal in September, we believe the second half of fiscal 2017 is positioned well to deliver solid, profitable growth,” he said.

Evine’s top-performing category in the quarter was home, which increased 9 percent year-over-year.

Consumer electronics, which declined again as a result of management’s reduction of lower-margin merchandise, declined 8 percent. The so-called “wearables” group decreased collectively by 8 percent, driven by continued pressure in watches.

The return rate for the quarter was 19 percent, an improvement of 70 basis points year-over-year.

Gross profit as a percentage of sales decreased 20 basis points to 38 percent year-over-year, driven primarily by mix pressure from the home category. Gross profit dollars decreased 6 percent to $56.5 million year-over-year.

Operating expense decreased $3.1 million to $57 million, a 5 percent decrease, driven by reduced distribution and selling expenses.

“It is clear that there is a sea change occurring throughout the retail landscape,” Rosenblatt said.

“All retailers, be it online or those with a significant bricks-and-mortar presence, continue to try to find better and differentiated ways to connect with the consumer. We believe interactive video commerce messaged to the consumer, based on the delivery platform used, whether that be through social, or traditional eCommerce, in concert with the data and predictive analytics available, marks the next significant growth curve,” he said.

“When I look out two to three years from now,there will be two types of retailers: Those whose models are based on price, selling commoditized products available on multiple platforms, and those whose models are based on product exclusivity and the customer experience. Our goal is to be a leader in the latter category.”

“Interactive video is the cornerstone of our digital commerce company that is driving business opportunities in all digital platforms and business models, from mobile to social, from laptop to television, and from merchandising business models to web service business models. We plan to do this while engaging with all types of customers, from millennials to baby boomers and to both women and men. A significant portion of the population will continue to purchase product from a curated assortment that facilitates the opportunity of discovery. We believe interactive video commerce at scale, an expertise we have continued to refine over many years, gives us an unfair advantage in delivering that experience.”

QVC’s Second-Quarter Sales Dip 4 Percent

August 10, 2017

Like HSN, which it will soon own, QVC had a tough second quarter.

QVC’s parent, Liberty Interactive Corp., this week reported that the No. 1 home shopping network saw its second-quarter revenue drop 4 percent, to $1.37 billion, year over year.

QVC “experienced year-over-year revenue declines in all categories except home,” Liberty reported. As for the 4 percent drop, it was “inclusive of an estimated 1 percent negative impact from system outage in second quarter that resulted in shipment backlog into third quarter.” That was news to us.

QVC’s operating income, a key measure, dipped 5 percent, to $225 million.

“Operating income margin and adjusted OIBDA margin performance primarily reflect lower bad debt, higher product margins and higher credit card income, partially offset by higher bonus expense, warehouse costs and depreciation,” according to Liberty.

Similarly, HSN recently suffered a 4 percent drop in its second-quarter sales, to $532.2 million.

The numbers we just provided are for domestic QVC alone, not for the stable of home shopping channels that it has across the globe.

“QVC had a solid Q2, with revenue performance similar to Q1 and improved adjusted OIBDA margins,” Liberty Interactive President and CEO Greg Maffei said in a canned statement. “We were thrilled to announce the acquisition of HSNi, which will enhance QVC’s position as the leading global video eCommerce retailer.”

QVC honcho Mike George crowed about the performance of the international networks, but not the U.S. one.

“We were pleased to generate strong margin expansion in the second quarter due to our focus on cost controls and avoidance of excessive promotional activity,” George said in his canned statement.

“We are executing on a number of strategies that we expect to restore healthy growth, with a particular focus on greater diversity and newness in our assortments. We were delighted with the strong performance of our International segment, which was led by QVC Japan. We look forward to welcoming the HSNi team to the QVC family with the completion of the acquisition in the fourth quarter, which we believe will be accretive to all of our stakeholders.”

HSN 2Q Sales Dip 4 Percent, To $532.2 Million

August 4, 2017

Looks like the second quarter another was a tough one for home shopping networks.

On Thursday HSN reported that its net sales for the quarter were $532.2 million, a 4 percent drop from the prior year. Sales grew in wellness and home, offset by decreases in electronics, beauty and jewelry.

The earnings press release talked about Liberty Interactive Corp.’s pending acquisition of HSN.

“We continue to focus on building our proprietary product pipeline which we believe will ultimately lead to growth in the business,” HSN Inc. Chief Financial Officer Rod Little said in a canned statement. “The continued strength of digital sales, and mobile sales in particular, has been very encouraging with digital sales now representing 55% of our total revenue. Mobile, which we see as our flagship, continues to be our fastest growing sales channel and a source of new customer acquisition.”

“As we prepare for the pending acquisition by Liberty, we remain committed to our strategies to improve performance both in the short and long term,” he said. “Our key priorities remain: acquiring and retaining customers via a robust and relevant product portfolio, optimizing our digital platforms and improving efficiencies throughout the business, all to drive consistent shareholder value creation.”

The No. 2 home shopping network said shipping revenue decline primarily due to the August 2016 changes in the standard shipping rates and increased promotions. The average price point decreased 7 percent, while units shipped increased 2 percent largely due to changes in product mix, according to the press release.

Gross profit decreased 5 percent to $186.8 million. Gross profit rate decreased 30 basis points to 35.1 percent, primarily due to a decrease in shipping revenue and higher shipping and fulfillment costs, partially offset by higher product margins and lower inventory reserves due to a change in accounting estimate.

The increase in shipping and fulfillment costs was primarily due to annual outbound rate increases and implementation costs associated with HSN’s ongoing supply-chain optimization initiative, the network said.

Operating expenses increased 4 percent to $147.6 million driven by about $3.7 million in transaction costs related to the merger agreement, an increase in employee-related costs, higher costs incurred as part of the supply-chain O initiative and an increase in bad debt expense, partially offset by lower stock-based compensation expense primarily due to the departure of CEO Mindy Grossman during the quarter.

Excluding non-cash charges and transaction costs, operating expenses increased 4 percent and were 25.6 percent as a percentage of net sales compared to 23.5 percent in the prior year.

Operating income decreased $15.9 million, or 29 percent, to $39.2 million. Adjusted EBITDA decreased $15.8 million, or 24 percent, to $50.5 million. The supply-chain implementation resulted in an additional $2.9 million of costs in the second quarter, which impacted gross profit and operating expenses.

HSN, QVC’s Parent To Report 2Q Earnings

July 15, 2017

HSN Inc., about to be swallowed up by QVC’s parent company, as well as that parent, Liberty Interactive Corp., will be releasing their second-quarter results early next month, both companies announced this week.

HSN will report its second-quarter earnings Aug. 3 at 8 a.m., before the market opens.

Chief Financial Officer Rod Little; Bill Brand, chief marketing officer of HSNi and president of HSN; and Judy Schmeling, chief operating officer of HSNi and president of Cornerstone Brands, “who together constitute the Office of the CEO,” will hold a conference call at 9 a.m. to review these results.

Those interested in participating in the conference call should dial 877-307-0246 or 224-357-2394 at least five minutes prior to the call. There will also be a simultaneous audio webcast available via the company’s website at http://www.hsni.com.

A replay of the conference call can be accessed until Aug. 17 by dialing 855-859-2056 or 404-537-3406, plus the pass code 54744987 and it will also be hosted on the company’s website for a limited time.

Liberty Interactive President and CEO Greg Maffei will host a conference call to discuss results for the second quarter Aug. 8, at 2:30 p.m.

Following prepared remarks, the company will host a brief Q&A session during which management will accept questions regarding both Liberty Interactive Corporation and Liberty TripAdvisor Holdings.

Maffei may discuss the financial performance and outlook of both companies, as well as the proposed acquisition of HSN.

The second-quarter earnings conference call will be broadcast live via the internet. All interested participants should visit the Liberty website at http://www.libertyinteractive.com/events to register for the webcast.

Links to the press release and replays of the call will also be available on the website, and the conference call will be archived ror one year after appropriate filings have been made with the SEC.

What Does HSN’s Sale To QVC’s Parent Mean?

July 10, 2017

We’ve been busy at work, and in addition to that we wanted time to mull over Liberty Interactive Corp.’s purchase of HSN Inc. before we blogged in more detail about it.

For some reason we couldn’t find the conference call that Liberty and HSN honchos held on the deal last week, even though it was supposed to be archived on John Malone’s fiefdom’s website. But we did finally read through the slide-show presentation that went with the call.

http://files.shareholder.com/downloads/AMDA-GY7JI/4764467488x0x948623/652F4347-6F0B-48D9-9D4B-2EE0E92881D2/QVC_HSN_Investor_Presentation.pdf

First of all, the initial press release on QVC’s parent paying $2.1 billion for HSN was unclear, in that it did not spell out that there were no plans to merge the nation’s two largest home shopping networks. The investor slide presentation did bring clarity, saying that QVC and HSN will be maintained as distinct brands, which means five channels — QVC, QVC2, BeautyiQ, HSN and HSN2.

The goal is to preserve the “unique identities, cultures and customer following” for the networks.

But at the same time, according to the presentation, the plan is to “optimize five U.S.- based networks (QVC, QVC2, BeautyiQ, HSN, HSN2) and create complementary programming.”

Okey-dokey. Sounds a little contradictory to us.

The other goals are, straight from the presentation, to:

Collaborate on best-in-class digital platforms (mobile, personalization, social, marketing) and next-gen shopping innovations

Extend HSN’s Shop by Remote platform to QVC

Strengthen brand portfolios

Extend top HSN brands to QVC International and Zulily,

Leverage Zulily as brand feeder with younger customers, utilize QVC global development
capabilities

Explore cross-marketing opportunities to better engage existing and potential customers

Share best practices and tools, leverage top talent and create new professional-growth opportunities

Pursue integration opportunities to enable combined company to operate more efficiently,
fund innovation and enhance customer value, including:

Combining technology platforms where appropriate

Leveraging enhanced scale of supply chain and customer service networks

Eliminating redundant corporate and support services

Reducing costs through purchasing synergies

So we can expect to see HSN brands expand globally and pop up on QVC’s numerous international channels.

There were some very interesting additional facts in the presentation, as well. QVC has 8 million customers, and 6 million of them don’t shop at HSN today, according to Liberty. We find that hard to believe, since we shop at both nets and Evine as well, but that’s what they said. HSN has 5 million customers.

By cross-marketing, QVC can try to get some of HSN’s customers to shop with it.

QVC has 29 on-air hosts, while HSN has 24, just FYI.

And of course, whenever one company buys another one there is always talk of synergies, which basically means people are going to lose their jobs. In this acquisition, there’s a lot of places where QVC and HSN have overlap and where cost-cutting can happen. A lot of it may be behind the scenes, however.

For example, cable networks have what are called affiliates sales departments, the executives and sales reps who negotiate the contracts for QVC and HSN to get carried on your cable system or by your DBS provider, be it Comcast or DirecTV. You won’t need two affiliate sales departments to handle that function.

And with QVC and HSN under one roof, whoever survives in affiliate sales will now have a bundle of five networks it can bring to cable companies. Just like a Discovery Communications with its many networks or a Viacom, the QVC-HSN affiliate sales reps can tell a Comcast that if it carries smaller startup channels like BeautyIQ, it will get a better deal on the larger channels, QVC and HSN.

There are other “synergies.” Some vendors supply goods to several home shopping networks. One of our readers recently reported that she had ordered bedding from Paula Deen’s line on Evine, but when the order came it was Northern Lights, as we recall, which is sold by QVC. The point is that one manufacturer is making items for both channels.

Vendors who manufacture goods for QVC and HSN might get squeezed, with Liberty trying to negotiate much cheaper deals because it has leverage as a major customer of such companies.

The big advantage of this merger, as everyone and their mother has pointed out, is that this will increase QVC’s and HSN’s scale as digital players, putting them in a better position to compete against giant Amazon. The digital sales of both those home shopping channels have soared over the past few years, and with distribution centers and those of their sister companies, Zulily and Cornerstone, they gain traction against the big “A.”

HSN and its Cornerstone unit have warehouses in cities such as Piney Flats, Tenn., Fontana, Calif., Roanoke, Va., Monroe, Ohio, and Scottsdale, Ariz.

For QVC and Zulily, there are fulfillment centers Rocky Mount, N.C., Florence, S.C., Suffolk, Va., Ontario, Calif., Lancaster and Bethlehem, Penn., McCarran, Nev., and Lockborne, Ohio.

Liberty needs a lot of distribution points to beat Amazon at its own quick-delivery game, but are all the above too many? We’ll see.

Liberty crowed about HSN in its presentation, saying that it brings a “rich legacy of innovation” to the QVC Group.

Liberty cited HSN’s “highly engaging programming and events, including movie tie-
Ins” and “American Dreams entrepreneur search series.”

There was also a shout-out to HSN’s leading brands, including Joy Mangano’s
Ingenious Designs, Andrew Lessman’s ProCaps Laboratories, IMAN Global Chic, Jennifer Flavin Stallone’s Serious Skincare, Wolfgang Puck Kitchen, Diane Gilman
Fashion and the Concierge Collection.

QVC’s top honcho, Mike George, will ride herd over the new and larger QVC Group.
But what will happen with the top management at HSN?

Former CEO Mindy Grossman has flown the coop, already starting her new gig at Oprah Winfrey’s Weight Watchers. Bill Brand is a very talented HSN honcho, and we hope he’s in line for a promotion to fill Grossman’s high-heels.

QVC To Buy HSN In $2.6 Billion Merger

July 6, 2017

You may have to kiss goodbye to a lot of your favorite hosts and vendors at the two top home shopping networks, because QVC’s parent company is buying HSN.

At first blush, it appears that Liberty Media Interactive Corp. will keep both QVC and HSN operating as two separate channels, but John Malone’s company anticipates cost savings, and that that usually translates to people losing jobs. Believe us, we know firsthand. But we have not listened to the conference call on the deal yet to be sure.

The huge news was announced Thursday morning, coincidentally just a day after HSN bigwig Mindy Grossman started her new gig at Oprah Winfrey’s Weight Watchers.

http://ir.libertyinteractive.com/releasedetail.cfm?ReleaseID=1032273

http://www.philly.com/philly/business/qvc-home-shopping-network-merge-20170706.html

The acquisition gives Liberty a portfolio of five domestic home shopping channel, namely QVC, QVC2, BeautyiQ, HSN and HSN2.

The all-stock deal is valued at $2.6 billion, with Liberty acquiring the 62 percent of HSN Inc. it doesn’t own. Liberty will offer compensation of $2.1 billion in shares, but the press release says there will be $2.6 billion of “total enterprise value,” whatever that means.

“We are excited to announce the acquisition of HSNi,” Liberty CEO Greg Maffei said in a canned statement.

“The addition of HSN will enhance QVC’s position as the leading global video eCommerce retailer. Every year they together produce over 55,000 hours of shoppable video content and have strong positions on multiple linear channels and OTT [over the top] platforms. The value of the combined QVC, HSNi and zulily will be further highlighted when later this year QVC Group becomes an asset-backed stock as part of the previously announced split-off of Liberty Ventures.”

Here’s what smiling QVC honcho Mike George had to say in the press release.

“We’re thrilled to welcome the HSNi team to our company,” he said.

“HSNi founded the industry 40 years ago and helped it grow with exciting initiatives like Shop By Remote and media integrations with leading content producers. By creating the leader in discovery-based shopping, we will enhance the customer experience, accelerate innovation, leverage our resources and talents to further strengthen our brands, and redeploy savings for innovation and growth. As the prominent global video commerce retailer and North America’s third largest mobile and eCommerce retailer, the combined company will be well-positioned to help shape the next generation of retailing.”

Here’s what Liberty says the benefits of the deal are: increase scale, enhancing the competitive position of QVC Group; meaningful synergies through cost reduction and revenue growth opportunities; increased development of eCommerce, mobile and OTT platforms; optimize programming across five U.S. networks; cross marketing to better engage existing and potential customers; financial optionality due to HSNi’s lower debt leverage.

HSNi consists of HSN and Cornerstone, which includes Ballard Designs, Frontgate, Garnet Hill, Grandin Road and Improvements.

Post-closing of the deal, expected in the fourth quarter, HSNi headquarters will remain in St. Petersburg and will be overseen by George.

“Joining the QVC Group will give us instant access to global consumer markets, a leadership team with deep expertise and a global perspective, and the opportunity to further strengthen our content-based brand portfolios in a changing retail landscape,” said Arthur Martinez, HSN’s board chairman.

“We have both been innovators in a growing and dynamic retail environment with a unique vision of what shopping should be, and as new technologies continue to change our everyday lives, together we can develop the next generation of shopping for the next generation of consumers.”

Maffei and George discussed the transaction in a conference call this morning, which will be archived on Liberty’s website. To access the webcast go to http://www.libertyinteractive.com/events.

We can’t listen now, but will later and report back.

Our Fav Fitflops Trot Onto HSN

June 29, 2017

Three cheers for HSN for premiering Fitflops tonight as its Today’s Special.

If you are not familiar with the brand, these sandals and shoes have been engineered with special soles that distribute your body weight and absorb shock for maximum comfort.

Our sister and hairdresser first recommended these to us when we broke our left ankle, for support for our feet. We have eight pairs now, nearly all of them purchased at TJ Maxx. We paid $39.99 for most of our’s, but they normally retail for much more, $80 or more depending on the style and whether they are leather or not.

HSN is selling them for $49.99, which is a pretty good price break.