Home categories a highlight for HSNi
Larry Thomas -- Casual Living, February 21, 2013
St. Petersburg, Fla. - Sales growth in home design and household, especially home textiles, at HSN and in the Cornerstone home brands Ballard Designs and Grandin Road were credited with helping drive parent company HSNi's performance over the fourth quarter and full year.
As evp and cfo Judy Schmeling highlighted during the multi-channel retailer's earnings call today, sales increased in the quarter in every product category at HSN, and every Cornerstone brand had a significant increase in digital penetration.
Added Mindy Grossman, ceo and director: "It was a record year for customer growth and digital penetration at both HSN and Cornerstone...HSN experienced a number of key milestones, including 3% growth in its customer file - the largest in five years - and retention rates achieved 10-year highs. HSN's mobile sales continued to accelerate, reaching $63 million in the quarter, nearly exceeding total mobile sales for all of 2011."
HSNi's sales over the fourth quarter, ended Dec. 31, grew 7%to $982.9 million, including 11% growth in digital sales. Cornerstone's sales rose 6% to $299.1 million, including 14% growth in digital sales.
Operating income increased 8% to $92.8 million, and was also favorably impacted by a reduction in stock-based compensation. GAAP dilutedand earnings per share from continuing operations increased 27% to $1.00.
HSNi's annual sales grew 6% over the prior year to $3.3 billion HSN's net sales were up 5% to $2.3 billion, including 10% growth in digital sales. Cornerstone's sales climbed 10% to $1.0 billion, including 18% growth in digital sales.
Annual operating income increased 8% to $258.7 million, and EPS jumped 12% to $2.36.
Looking ahead, the company is hoping to build on its recent momentum, especially in home.
The HSN property last month launched a "digital redesign" across all platforms to better integrate its content with community and commerce.
"As with any other undertaking of this magnitude there is a period of refinement and customer acclamation, so we do expect digital sales at HSN to be tempered in the first quarter as these actions are fully implemented," Schmeling warned.
At Cornerstone, the "immediate focus is to leverage last year's success in outdoor furnishings in the home brands, particularly at Frontgate, which is launching its largest outdoor collection ever."