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Web sales dip 5.3% for American Greetings in Q3
Total sales rose with help from a recently acquired U.K. card company.
Third quarter financial results were mixed for American Greetings Corp. as web sales declined but overall sales increased.
For the quarter ended Nov. 23, American Greetings, No. 208 in the 2012 Internet Retailer Top 500, reported:
- Web sales from AG Interactive, its e-commerce division, of $16.0 million, a 5.3% decrease from $16.9 million in the third quarter last year.
- Net income from AG Interactive of $5.3 million, a 43.2% increase from $3.7 million.
- Total sales of $506.8 million, up by 9.0% from $465.0 million.
- Overall net loss of $809,000, compared with net income of about $20.2 million in the prior year quarter.
Online sales represented 3.2% of total sales in the quarter, compared with 3.6% in Q3 2012
The total sales figure includes $67.6 million in sales as a result of American Greetings’ June acquisition of certain assets of U.K-based Clinton Cards, including approximately 400 stores, its e-commerce site (ClintonCards.co.uk) related overhead and the Clinton Cards and related brands. The additional revenue came from Clinton Cards stores, American Greetings says.
American Greetings says it made the acquisition by assuming $56.6 million in Clinton Cards debt. Clinton Cards then entered into “administration,” the U.K. equivalent of Chapter 11 bankruptcy, enabling it to restructure.
Through the first nine months, American Greetings reported:
- Web sales from AG Interactive, its e-commerce division, of $47.3 million, down by 4.8% from $49.7 million in the same period last year.
- Net income from AG Interactive of $13.7 million, a 24.5% increase from $11.0 million.
- Total sales of $1.28 billion, a 4.9% increase from $1.22 billion.
- Overall net income of $2.2 million, compared with net income of $67.3 million in the first nine months of fiscal 2012.
E-commerce represented 3.7% of total sales in the period, compared with 4.1% in the first nine months of 2012
The company’s future as a public entity remains in limbo. American Greetings formed a committee comprising members of its board of directors in October to consider a proposal to take the company private. In September CEO Zev Weiss, as head of a shareholder group, proposed buying all of about 35.15 million shares for $17.18, a deal valued at $603.9 million.