The publishing segment may be Martha Stewart Living Omnimedia’s biggest revenue source, but in the third quarter it continued to be the heaviest drag on income. Publishing revenues were down 17 percent for the quarter to $27.5 million and the group recorded a $51 million operating loss, compared to a $3.5 million loss in 3Q 2011.
"Our performance in the quarter was in line with our expectations but not our ambitions for the company," said MSLO president and CEO Lisa Gersh in a statement.
The financials come on the heels of yesterday’s announcement that the company is dramatically scaling back Everyday Food from a 10-times per year frequency to a 5-times supplement to Martha Stewart Living. Whole Living has been put on the block and if there is no buyer the company will fold the title.
The publishing revenue drop is attributed to lower advertising revenues across print and digital. The bulk of the $51 million operating loss was a $44 million non-cash goodwill write-down, says the company. Excluding the write-down, the loss is still double that of 3Q 2011.
The reduction in print and the reported layoffs associated with it will save the company approximately $33 million to $35 million in annual operating expenses.
Merchandising revenues increased by 7 percent to $13 million for the quarter. The company’s third segment, broadcasting, dipped significantly in revenue from $6.6 million to $2.7 million, signaling its move away from a daily live television format. That change, however, resulted in improved income of $300,000 in the quarter versus a $1.3 million loss last year.
Total company revenues were down 16.5 percent for the quarter and the operating loss was $51 million.