May 2, 2013, 1:03 PM

TV and web retailer HSN grows online sales 9.6% in Q1

The web accounts for 44.6% of total sales, the retailer reports.

Lead Photo

A look at HSN's redesigned site.

The web accounted for almost all of the growth in the first quarter for TV and web retailer HSN Inc.

Web sales for Q1 2013 reached $344.6 million, up 9.6% from $314.4 million in Q1 2012, the company reports. Total sales hit $772.7 million in Q1 2013, up 4.7% from $737.9 million in Q1 2012. The web accounted for 44.6% of total sales and 87% of the sales growth in the first quarter.

  • Adjusted earnings before interest, taxes, depreciation and amortization, or EBITDA, increased nearly 0.8% to $66.8 million in Q1 2013 compared with $66.3 million in Q1 2102. These results were driven by the near 5% increase in net sales and an increase in gross margin from 36.2% to 36.3% year over year, offset by a 6% increase in operating expenses (excluding non-cash charges), the retailer says. 
  • Operating income reached $52.5 million in Q1 2013, up 2.3% from $51.3 in Q1 2012.
  • HSN Inc. is divided into two operating segments: HSN and cataloger Cornerstone. HSN’s net sales hit $550.1 million in Q1 2013, up 1.5% from $541.9 million in Q1 2012. Web sales reached $196.4 million, or 35.7% of total sales, in Q1 2013, up 3.9% from $189.1 million, or 34.9% of total sales, in Q1 2012.
  • HSN’s adjusted EBITDA reached $58.9 million in Q1 2013, up 2.8% from $57.3 million in Q1 2012. The segment’s operating income hit $48.6 million in Q1 2013, up 2.3% from $47.5 million in Q1 2012. HSN’s units shipped hit 11.4 million in Q1 2013, up 11.8% from 10.2 million in Q1 2012. And HSN’s return rate for Q1 2013 was 20.0%, up from 19.3% in Q1 2012.
  • Cornerstone’s net sales hit $222.5 million in Q1 2013, up 13.5% from $196.0 million in Q1 2012. Web sales hit $148.6 million, or 66.8% of total sales, in Q1 2013, up 19.0% from $124.9 million, or 63.7% of total sales, in Q1 2012.
  • Cornerstone’s adjusted EBITDA reached $7.9 million in Q1 2013, down 11.2% from $8.9 million in Q1 2012. The segment’s operating income hit $3.9 million in Q1 2013, up 2.6% from $3.8 million in Q1 2012. Cornerstone shipped 3.2 million units in Q1 2013, up 10.3% from 2.9 million in Q1 2012. The segment’s return rate for Q1 2013 was 13.7%, down from 14.2% in Q1 2012. And Cornerstone circulated 75.7 million catalogs in Q1 2013, up 10.5% from 68.5 million in Q1 202.

During the first quarter of 2013, HSN Inc. repurchased approximately 1.2 million shares of its common stock at a cost of $65.3 million, or an average cost of $53.80 per share. From inception of the share repurchase program in September 2011 through May 1, 2013, HSN Inc. has repurchased 8.2 million shares at a cost of $353.5 million, or an average cost of $43.03 per share.

Effective May 2, HSN Inc.’s board of directors approved a quarterly cash dividend of $0.18 per share payable June 19, 2013, to shareholders of record as of June 5, 2013.

HSN is No. 24 in the new Internet Retailer Top 500 Guide.

 

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