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Spiegel, Martha Stewart See Figures Fall; Other DMers Gain

Two companies buffeted by bad press — The Spiegel Group and Martha Stewart Living Omnimedia Inc. — reported sales declines while others releasing earnings reports yesterday announced solid increases.

At Spiegel, Downers Grove, IL, net sales fell 22 percent in the four weeks ended Feb. 28 versus the comparable period ended Feb. 22, 2003.

Comparable-store sales for its Eddie Bauer division decreased 2 percent in the four-week period. The group's net sales from retail and outlet stores fell 16 percent for the month, mainly because of store closings. The company operated 440 stores at the end of February 2004, down from 571 at the end of February 2003. The majority of closings resulted from actions taken as part of the company's long-running reorganization.

The group's direct net sales — catalog and e-commerce — plummeted 27 percent for the month, “primarily due to a planned reduction in catalog circulation, lower customer demand and, to a lesser extent, the impact of higher back orders resulting from lower inventory levels,” the company said.

Martha Stewart Living Omnimedia reported fourth-quarter revenue of $70.9 million compared with $77.6 million in the prior-year quarter. However, operating income was $5.8 million compared with an operating loss of $3.4 million in fourth-quarter 2002. For the year ended Dec. 31, revenue was $245.8 million, down from $295 million in 2002. An operating loss of $6.4 million in 2003 contrasted with income of $20 million in 2002.

“We continued to feel the negative impact of the events surrounding Martha Stewart's personal legal situation,” Sharon L. Patrick, president/CEO, said in a statement. “As the trial approaches conclusion, we have prepared for the various possible outcomes and are focused on strategies to grow the value of the business and improve the future financial performance.”

Patrick also cited “improved performance of our now smaller, more niche-focused catalog, Martha Stewart: The Catalog for Living.”

In the Internet/Direct Commerce segment, quarterly revenue was $9.4 million versus $13.7 million in the year-ago period. The reduced revenue was attributed to lower product sales and lower ad revenue. Lower product sales resulted mainly from efforts to “circulate fewer catalogs and focus on more efficient circulation levels.” The operating loss was $1.2 million for fourth-quarter 2003 compared with $8.1 million in fourth-quarter 2002, excluding restructuring charges.

Among other direct marketers reporting earnings:

· J.C. Penney said comparable department store sales climbed 12.1 percent in the four weeks ended Feb. 28 as catalog/Internet sales increased 8 percent.

· Sharper Image Corp., San Francisco, said that in the fiscal month ended Feb. 29, total company sales rose 47 percent. Total store sales increased 45 percent while comparable-store sales jumped 20 percent, with comparable-store sales calculated based on February's first 28 days. Total catalog sales ballooned 45 percent, and Internet sales skyrocketed 63 percent.

· The Talbots Inc., Hingham, MA, said total company sales for fiscal February — the four weeks ended Feb. 28 — increased 10 percent. Comparable-store sales rose 5.8 percent for the month.

· JoS. A. Bank Clothiers Inc., Hampstead, MD, said total sales for the fiscal month ended Feb. 28 improved 55.8 percent from the prior-year period. Comparable-store sales increased 34.2 percent, while combined catalog and Internet sales were up 34.7 percent.

· Federated posted an 8.8 percent sales rise in the four weeks ended Feb. 28 versus the same period last year. On a same-store basis, February sales were up 9 percent.

· Staples Inc., Framingham, MA, in announcing fourth-quarter and full-year results for the period ended Jan. 31, said that quarterly net income rose 29 percent while total company sales grew 10 percent. Full-year sales were up 14 percent. Worldwide e-commerce sales increased 31 percent.

· Abercrombie & Fitch, New Albany, OH, posted a 21 percent increase in net sales for the four weeks ended Feb. 28. February comparable-store sales rose 1 percent.

· Nordstrom Inc., Seattle, produced preliminary sales of $431.3 million for the 28-day period ending Feb. 28, up 11.8 percent from the 29-day period ending March 1, 2003. Same-store sales rose 8.8 percent for the 28-day period in 2004 versus the 29-day period in 2003. On a comparable 28-day to 28-day basis, same-store sales increased 14.1 percent.

· Limited Brands, Columbus, OH, generated a comparable-store sales increase of 5 percent in the four weeks ended Feb. 28 versus the four weeks ended March 1, 2003. Net sales totaled $607.9 million compared with sales of $571.6 million last year.

· Sears, Roebuck and Co., Hoffman Estates, IL, said comparable domestic store revenue rose 1.1 percent in the four weeks ended Feb. 28. Total domestic store revenue fell 0.5 percent from the four weeks ended March 1, 2003.

· The Bombay Company Inc., Fort Worth, TX, said late Wednesday that revenue for the four weeks ended Feb. 28 improved 3 percent from the four weeks ended March 1, 2003. But same-store sales fell 9 percent.

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