Revenue and profit hit a soft spot at St. Petersburg-based retailer HSN Inc. this last quarter, and executives with the St. Petersburg-based television, online and catalog retailer pointed to the weather map to explain why.
“Similar to the overall retail sector, our results were impacted in the first quarter partially due to severe weather across the country,” said Mindy Grossman, CEO of HSN Inc., adding that the company also suffered from overall “softness” in women’s apparel, particularly at the company’s Garnet Hill catalog.
Revenue grew 1 percent in the quarter ended March 31 to $777.4 million, compared to one Wall Street forecast survey that expected $792.94 million, while net income fell 14 percent to $27.3, or 45 cents per share, compared to expectations of 59 cents. That helped clip the company’s stock price by 6 percent in morning trading to $54.54.
As for how weather would affect an online and television-based retailer, HSN spokeswoman Gigi Ganatra Duff said customers — particularly in the Northeast — “were not in the mindset to purchase outdoor furniture.”
HSN executives said overall profits were also cut by $3.1 million for a “tentative settlement” with the Consumer Product Safety Commission for a ladder sold through Frontgate catalog from 2005 to 2010.
HSN overall has been improving its business over the last several years, particularly by modernizing the product lineup and recruiting more celebrities to team up and pitch products on air and online. HSN Inc. employs 6,300 people, including its catalog divisions. It has more than 2,000 workers in the St. Petersburg area where the company operates a television production center and customer service center.
“I believe our opportunity to drive growth remains intact and we are pleased with the areas of strength that we demonstrated during the quarter,” Grossman said, pointing out that more customers are using mobile devices to order.