Martha Stewart Company Cuts Losses

28 April 2005

The return from the Alderson, West Virginia women's correctional facility of Martha Stewart to the bosom of her struggling US media business, has resulted in a slowing of losses, according to figures for the first quarter.

New York-headquartered Martha Stewart Living Omnimedia, the vehicle through which the guru of genteel homemaking exploits her brand, reports net losses of $19.2 million (€14.8m, £10.08m), down from $19.5m for the same period last year. Sales fell 13% to $38.7 million.

Sales increased, however, by 6% at the publishing business, the only unit to strengthen revenue, as the company ramped up circulation and advertising at its fledgling Everyday Food magazine.

But fewer ad sales and higher costs at the flagship magazine, Martha Stewart Living, doubled the unit's loss to $7.7m. Company president and ceo Susan Lyne, nevertheless, expects ad pages at the magazine to grow more than 30% in Q2.

She says: "We see early signs of improvement in our core publishing business, and while this will not be an overnight recovery, we believe this trend will continue over the long term."

Stewart is currently under five months house arrest following a similar prison term for lying about share dealings. Since her release the media maven has been strengthening her public profile and replenishing her coffers with two new TV shows lined up and a $30m deal with Sirius Satellite Radio [WAMN: 20-Apr-05].

Data sourced from Wall Street Journal Online; additional content by WARC staff