- Company divested of its TravelSmith and Chasing Fireflies businesses
- Net sales decreased 5%, or 3% excluding the impact of the divested businesses
- Digital sales up 2% with sales penetration increasing 330 basis points to 53%
- Diluted EPS was $0.38; Adjusted EPS was $0.52
|HSNi SUMMARY RESULTS AND KEY OPERATING METRICS (a)(In millions, except per share and average price point amounts)|
|Q3 2016||Q3 2015||Change|
|Non-GAAP results: (b)|
|Adjusted Net Income||$||27.2||$||37.5||(27||%)|
|Average price point||$||61.75||$||63.95||(3||%)|
|Gross profit rate||34.0||%||35.4||%||(140 bps)|
|Return rate||15.3||%||15.7||%||40 bps|
|Digital sales penetration||52.7||%||49.4||%||330 bps|
|(a) Includes the results of TravelSmith and Chasing Fireflies through the date of the divestiture on September 8, 2016.|
|(b) See reconciliation of Non-GAAP to GAAP measures in Table 4.|
- On September 8, 2016, Cornerstone completed the divestiture of TravelSmith and Chasing Fireflies, two of the apparel brands within its portfolio. In the third quarter of 2016, Cornerstone recorded a loss on sale of $11.2 million.
- HSNi's net sales, which include the results of TravelSmith and Chasing Fireflies through the date of sale, decreased 4.8% to $823.0 million. HSN's net sales decreased 3.5% to $569.7 million. Cornerstone's net sales, which include the results of TravelSmith and Chasing Fireflies through the date of sale, decreased 7.6% to $253.4 million. Excluding the results of TravelSmith and Chasing Fireflies from both periods, HSNi's and Cornerstone's net sales decreased 3.3% and 2.6%, respectively. HSNi's digital sales grew 2% with penetration increasing 330 basis points to 52.7%.
- HSNi's operating income, which includes a loss of $11.2 million related to the divestiture of TravelSmith and Chasing Fireflies recorded within the Cornerstone segment, decreased 36% to $36.9 million. HSN's operating income decreased 16% to $47.0 million. Cornerstone's operating loss was $10.1 million compared to operating income of $1.6 million in the prior year.
- Net income was $20.2 million compared to $34.2 million in the prior year.
- HSNi's Adjusted EBITDA decreased 19% to $62.9 million. HSN's Adjusted EBITDA decreased 14% to $58.0 million. Cornerstone's Adjusted EBITDA was $4.9 million, a decrease of $6.1 million.
- Diluted EPS, which includes the loss related to the divestiture of TravelSmith and Chasing Fireflies of $0.13 per diluted share, was $0.38 compared to $0.64 in the prior year. Adjusted EPS was $0.52 compared to $0.70 in the prior year.
- HSNi's board of directors approved a quarterly cash dividend of $0.35 per share payable December 20, 2016 to shareholders of record as of December 7, 2016.