-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, TE+eNyGiDSdvTDXLZnVk08tn5nV/gzjSBE7bYGXd6ljuziKFp6WFgxZ3vgbAradL hHHDpPDVZGdcQQ2B6Og30g== 0000950123-04-009155.txt : 20040803 0000950123-04-009155.hdr.sgml : 20040803 20040803102329 ACCESSION NUMBER: 0000950123-04-009155 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20040803 ITEM INFORMATION: ITEM INFORMATION: Financial statements and exhibits FILED AS OF DATE: 20040803 FILER: COMPANY DATA: COMPANY CONFORMED NAME: MARTHA STEWART LIVING OMNIMEDIA INC CENTRAL INDEX KEY: 0001091801 STANDARD INDUSTRIAL CLASSIFICATION: PERIODICALS: PUBLISHING OR PUBLISHING AND PRINTING [2721] IRS NUMBER: 522187059 STATE OF INCORPORATION: DE FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-15395 FILM NUMBER: 04946899 BUSINESS ADDRESS: STREET 1: 20 WEST 43RD STREET CITY: NEW YORK STATE: NY ZIP: 10036 BUSINESS PHONE: 2128278000 MAIL ADDRESS: STREET 1: 20 WEST 43RD STREET CITY: NEW YORK STATE: NY ZIP: 10036 8-K 1 y99714e8vk.txt FORM 8-K UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 -------------- FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of Report: August 3, 2004 Date of Earliest Event Reported: August 3, 2004 MARTHA STEWART LIVING OMNIMEDIA, INC. (Exact Name of Registrant as Specified in Charter) Delaware 001-15395 52-2187059 (State or Other (Commission File Number) (IRS Employer Jurisdiction of Identification No.) Incorporation) 11 West 42nd Street New York, NY 10036 (Address of Principal Executive Offices) Registrant's telephone number, including area code: (212) 827-8000 ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS. (c) Exhibit Description 99.1 Martha Stewart Living Omnimedia, Inc. Press Release, dated August 3, 2004. ITEM 12. RESULTS OF OPERATIONS AND FINANCIAL CONDITION. On August 3, 2004, the Registrant issued a press release relating to its financial results for the second quarter of 2004. The full text of the press release is attached hereto as Exhibit 99.1 to this report. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. Dated: August 3, 2004 MARTHA STEWART LIVING OMNIMEDIA, INC. By: /s/ James Follo ----------------------------------- James Follo Executive Vice President, Chief Financial and Administrative Officer Index of Exhibits
Exhibit No. Description - ----------- ----------- 99.1 Martha Stewart Living Omnimedia, Inc. press release, dated August 3, 2004.
EX-99.1 2 y99714exv99w1.txt PRESS RELEASE EXHIBIT 99.1 MARTHA STEWART LIVING OMNIMEDIA, INC. ANNOUNCES SECOND QUARTER RESULTS NEW YORK, NEW YORK, AUGUST 3, 2004 -- Martha Stewart Living Omnimedia, Inc. (NYSE: MSO) today announced its results for the second quarter and six-month period ended June 30, 2004. Revenues for the second quarter of 2004 were $44.0 million, compared to $65.8 million in the prior year's quarter. Operating loss for the second quarter was $(19.3) million, compared to operating income of $1.5 million for the second quarter of 2003. Operating income before depreciation and amortization, including the amortization of non-cash stock compensation, ("OIDA") for the second quarter of 2004 was a loss of $(16.6) million, compared to OIDA of $3.7 million in the same period last year. Loss per share from continuing operations was $(0.39) for the second quarter of 2004, compared to income per share from continuing operations of $0.02 in the second quarter of 2003. Sharon L. Patrick, President and Chief Executive Officer, said, "Our second quarter results, while reflecting losses due to the negative effects of Martha Stewart's personal legal situation, primarily on the Company's advertising performance, were nevertheless in line with our expectations and previous guidance. We remain encouraged by the support for the Company from our large, stalwart core base of readers, viewers and shoppers who remain loyal to our publications and quality products; and by our significant financial resources. Those resources - $158 million in cash and short-term securities and no debt - will allow us to manage through this period and invest in our future. "Given the recent developments in Martha Stewart's legal situation, we are moving ahead with a substantial amount of the uncertainty behind us. As we have said before, we continue to manage the Company for the long-term, carefully deploying our significant resources. Consistent with that approach, we have recently taken strategic actions, including adjusting staffing levels in our television business to reflect that we have placed the Martha Stewart Living program on hiatus for Season 12 and taking steps to transition our Internet/Direct Commerce segment to focus primarily on the delivery of our inspired and original `how-to' information for the home through our website. Furthermore, we continue to make progress to evolve our brands from expert personality to trusted brand labels on a step-by-step basis with an eye to future growth. "We announced today that we have signed a multi-year agreement with the PBS presenting station WETA in Washington D.C., to distribute our newest television series Everyday Food on PBS stations nationwide - 26 weekly episodes featuring an ensemble cast of the Company's highly talented cooks, who bring to life the simple, delicious recipes and techniques from the pages of the magazine. We expect this new program will generate additional demand for our Everyday Food magazine. "At the same time, we are taking additional steps to continue to reduce losses in our Internet/Direct Commerce business and to ensure that we invest our resources in areas that offer the Company its best return on investment. Accordingly, by year end 2004, we will eliminate our direct commerce business. However, we will continue our profitable direct-to-consumer floral business, marthasflowers, as well as our content website, marthastewart.com. "In addition, we have recently expanded our Board of Directors to include significant experience over a broad range of industries, including branding, advertising, retail and television. Senior management, along with the Board, is focused on restoring the Company to profitability and building value for our shareholders." SECOND QUARTER 2004 RESULTS BY SEGMENT PUBLISHING Revenues in the second quarter of 2004 were $23.7 million, compared to $39.6 million in the second quarter of 2003. Operating loss was $(5.3) million for the second quarter of 2004, compared to operating income of $9.3 million in the second quarter of 2003. OIDA was a loss of $(5.2) million, compared to income of $9.4 million in the second quarter of 2003. The results primarily reflect lower advertising revenue in the quarter from Martha Stewart Living magazine due to the combined effect of lower advertising pages and lower advertising rates as a result of the rate base reduction effective with the January 2004 issue. Subscription revenue was also lower in the quarter due principally to fewer subscriptions sold. The quarter also reflects our planned investment spending in Everyday Food, primarily in subscriber acquisition. We have increased the rate base of Everyday Food from 500,000 to 750,000, effective with the July 2004 issue. TELEVISION Revenues in the second quarter of 2004 were $3.1 million, compared to $6.6 million in the second quarter of 2003. Operating loss for the second quarter of 2004 was $(3.5) million, compared to breakeven in the second quarter of 2003. OIDA was a loss of $(3.5) million for the second quarter of 2004, compared to OIDA of $0.4 million in the prior year's second quarter. The decline in profitability was due to a variety of factors, including a reduction in license fees and advertising revenue from our nationally syndicated daily show; the December 31, 2003 expiration of certain cable licensing agreements; and severance costs. The quarter also included the write-down of deferred television production costs of $1.5 million, resulting from the early termination of a cable television licensing agreement. MERCHANDISING Revenues in the second quarter of 2004 were $10.9 million, compared to $11.8 million in the second quarter of 2003. The decline in revenue was due to a mix of factors, including the overall weak retail environment as well as continuing impact from Kmart store closings that took place in the early part of 2003. Second quarter 2004 operating income was $5.3 million, compared to $7.8 million in the second quarter of 2003. OIDA was $5.5 million in the current period, compared to $8.0 million in the prior year's quarter. Operating income and OIDA were negatively affected by $1.5 million of non-recurring professional fees related to the renegotiation of the Kmart contract incurred in the quarter. The decline in royalty revenue from sales at Kmart in the quarter will not impact full year results from operations, as we are paid based on guaranteed annual amounts. INTERNET/DIRECT COMMERCE Revenues in the second quarter of 2004 were $6.4 million, compared to $7.8 million in the same period a year ago. The lower revenues in the quarter were due to lower catalog-related product sales, partially offset by higher revenue from marthasflowers, our direct-to-consumer floral business. The lower commerce revenue was principally due to lower catalog circulation. Operating loss was $(2.4) million for the second quarter of 2004, compared to $(4.6) million in the second quarter of 2003. OIDA was $(2.2) million in the second quarter of 2004, compared to $(4.3) million in the second quarter of 2003. The better year-over-year results were achieved by a significant reduction in catalog circulation, combined with improvements in our floral business. As previously noted, in the interest of managing MSO's long-term financial strength, the Company has decided to discontinue The Catalog for Living by the end of 2004. Going forward, the segment will focus on delivering expert "how-to" content through our website, driving subscription magazine orders for our publishing group, and continuing to grow our direct-to-consumer floral business, marthasflowers, while exploring licensing and other alternative distribution opportunities for its products through our merchandising segment. While the Company has made significant progress over the past 18 months in improving the segment's financial performance, we concluded that focusing attention and resources on other areas of the business with greater growth potential would ultimately allow the Company to achieve improved financial performance. We do not expect that charges to operations during the remainder of 2004 related to severance and inventory will be material to our results of operations. CORPORATE OVERHEAD Corporate overhead, including depreciation and amortization and the amortization of non-cash stock compensation, was $13.3 million, compared to $11.1 million in the prior year's quarter. Corporate overhead, before depreciation and amortization and the amortization of non-cash stock compensation, was $11.3 million for the second quarter of 2004, compared to $9.8 million in the second quarter of 2003. The current quarter includes higher compensation-related costs, including the costs of certain Company-wide retention programs. AMORTIZATION OF NON-CASH STOCK COMPENSATION Amortization of non-cash stock compensation expense was $1.0 million in the second quarter of 2004 compared to $0.1 million for the second quarter of 2003. The expense in the 2004 quarter principally relates to the amortization of the value of restricted stock units granted in connection with a November 2003 stock option exchange program. DEPRECIATION AND AMORTIZATION Depreciation and amortization was $1.6 million in the second quarter of 2004 compared to $2.1 million for the second quarter of 2003. The lower depreciation in the current quarter was a result of lower depreciation of television studio assets that were fully depreciated in 2003. SIX MONTH 2004 OPERATING RESULTS Revenues for the six months ended June 30, 2004, were $88.5 million, compared to $123.8 million for the six months ended June 30, 2003. Operating loss was $(36.6) million for the six months ended June 30, 2004, compared to $(6.0) million for the six months ended June 30, 2003, while OIDA for the six months ended June 30, 2004, was $(30.8) million, compared to $(1.6) million in the same period one year ago. For the six month period ending June 30, 2004, net loss from continuing operations was $(39.3) million, or $(0.79) per share, compared to a net loss from continuing operations of $(3.1) million, or $(0.06) per share, in the six month period ending June 30, 2003. TRENDS AND OUTLOOK James Follo, Chief Financial and Administrative Officer, commented, "As a result of a comprehensive review of our businesses, we have reduced the cost structure in our television segment, eliminated certain aspects of our Internet/Direct Commerce segment and invested in new growth opportunities. Our financial resources remain significant, which will enable us to manage through this transition period. Our outlook for the third quarter is for a loss of approximately $(0.50) per share, reflecting higher marketing costs in the quarter and seasonal aspects of our business. The fourth quarter of 2004 results will reflect substantially reduced losses compared to third quarter levels largely due to the significant amount of revenues to be recognized by our merchandising segment as a result of certain minimum royalty guarantees." BASIS OF PRESENTATION The Company believes OIDA is an appropriate measure when evaluating the operating performance of its business segments and the Company on a consolidated basis. OIDA is used externally by the Company's investors, analysts, and industry peers. OIDA is among the primary metrics used by management for planning and forecasting of future periods, and is considered an important indicator of the operational strength of the Company's businesses. The Company believes the presentation of this measure is relevant and useful for investors because it allows investors to view performance in a manner similar to the method used by the Company's management and makes it easier to compare the Company's results with other companies that have different capital structures or tax rates. The Company believes OIDA should be considered in addition to, not as a substitute for, operating income (loss), net income (loss), cash flows, and other measures of financial performance prepared in accordance with generally accepted accounting principles ("GAAP"). As OIDA is not a measure of performance calculated in accordance with GAAP, this measure may not be comparable to similarly titled measures employed by other companies. A reconciliation of OIDA to operating income (loss) is provided in the financial statements included with this release. Martha Stewart Living Omnimedia, Inc. (MSO) is a leading provider of original "how-to" information that turns dreamers into doers, inspiring and engaging consumers with unique content and high-quality products for the home. MSO's creative experts develop content within eight core areas - Home, Cooking and Entertaining, Gardening, Crafts, Holiday, Keeping, Weddings, and Baby and Kids - that provide consumers with ideas and products to celebrate their homes and the domestic arts. MSO is organized into four business segments - Publishing, Television, Merchandising and Internet/Direct Commerce. The Company will host a conference call with analysts and investors at 12:00 noon ET that will be broadcast live over the Internet at www.marthastewart.com. ### This press release contains certain "forward-looking statements," as that term is defined in the Private Securities Litigation Reform Act of 1995. These forward-looking statements are not historical facts but instead represent only our current beliefs regarding future events, many of which, by their nature, are inherently uncertain and outside of our control. These statements can be identified by terminology such as "may," "will," "should," "could," "expects," "intends," "plans," "anticipates," "believes," "estimates," "potential" or "continue" or the negative of these terms or other comparable terminology. The Company's actual results may differ materially from those projected in these statements, and factors that could cause such differences include further adverse reaction to the prolonged and continued negative publicity relating to Martha Stewart by consumers, advertisers and business partners; further adverse reaction by the Company's consumers, advertisers and business partners to the outcome of Ms. Stewart's trial and related sentencing arising from a sale of non-Company stock by Ms. Stewart; a loss of the services of Ms. Stewart; a loss of the services of other key personnel; an adverse resolution to the SEC enforcement proceeding currently underway against Ms. Stewart arising from her personal sale of non-Company stock; adverse resolution of some or all of the Company's ongoing litigation; downturns in national and/or local economies; shifts in our business strategies; a softening of the domestic advertising market; changes in consumer reading, purchasing and/or television viewing patterns; unanticipated increases in paper, postage or printing costs; operational or financial problems at any of our contractual business partners; the receptivity of consumers to our new product introductions; and changes in government regulations affecting the Company's industries. Certain of these and other factors are discussed in more detail in the Company's filings with the Securities and Exchange Commission, especially under the heading "Management's Discussion and Analysis of Financial Condition and Results of Operations", which may be accessed through the SEC's World Wide Web site at http://www.sec.gov. The Company is under no obligation to update any forward-looking statements after the date of this release. CONTACT: Investors - Howard Hochhauser, VP Finance and Investor Relations of Martha Stewart Living Omnimedia, Inc., 212-827-8530; Media - Elizabeth Estroff, AVP, Corporate Communications, of Martha Stewart Living Omnimedia, Inc., 212-827-8281. Martha Stewart Living Omnimedia, Inc. Consolidated Statements of Operations Three Months Ended June 30, (in thousands, except per share amounts)
2004 2003 % change ---------- ---------- ---------- REVENUES Publishing $ 23,722 $ 39,617 -40.1% Television 3,056 6,588 -53.6% Merchandising 10,903 11,763 -7.3% Internet/Direct Commerce 6,365 7,814 -18.5% -------- -------- ------- Total revenues 44,046 65,782 -33.0% -------- -------- ------- OPERATING COSTS AND EXPENSES Production, distribution and editorial 30,411 35,448 -14.2% Selling and promotion 14,393 13,699 5.1% General and administrative 15,877 12,934 22.8% Amortization of non-cash stock compensation expense (a) 1,026 144 nm Depreciation and amortization 1,635 2,054 -20.4% -------- -------- ------- Total operating costs and expenses 63,342 64,279 -1.5% -------- -------- ------- OPERATING INCOME (LOSS) (19,296) 1,503 nm Interest income, net 319 395 -19.2% -------- -------- ------- INCOME (LOSS) BEFORE INCOME TAXES (18,977) 1,898 nm Income tax provision (189) (665) 71.6% -------- -------- ------- INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE LOSS FROM DISCONTINUED OPERATIONS (19,166) 1,233 nm -------- -------- ------- Loss from discontinued operations, net of tax benefit in 2003 (127) (302) 57.9% -------- -------- ------- NET INCOME (LOSS) $(19,293) $ 931 nm ======== ======== ======= INCOME (LOSS) PER SHARE - BASIC AND DILUTED Income (loss) from continuing operations $ (0.39) $ 0.02 Loss from discontinued operations (0.00) (0.01) -------- -------- Net income (loss) $ (0.39) $ 0.02 ======== ======== WEIGHTED AVERAGE SHARES OUTSTANDING Basic 49,572 49,488 Diluted 49,572 49,627
Martha Stewart Living Omnimedia, Inc. Segment Information Three Months Ended June 30, (in thousands)
2004 2003 % change -------- -------- -------- REVENUES Publishing $ 23,722 $ 39,617 -40.1% Television 3,056 6,588 -53.6% Merchandising 10,903 11,763 -7.3% Internet/Direct Commerce 6,365 7,814 -18.5% -------- -------- ------- Total revenues 44,046 65,782 -33.0% -------- -------- ------- OPERATING INCOME (LOSS) BEFORE DEPRECIATION AND AMORTIZATION Publishing (5,209) 9,427 nm Television (3,472) 387 nm Merchandising 5,516 7,988 -30.9% Internet/Direct Commerce (2,177) (4,308) 49.5% -------- -------- ------- Operating Income (Loss) before Depreciation (5,342) 13,494 nm and Amortization and Corporate Overhead Corporate Overhead (11,293) (9,793) -15.3% -------- -------- ------- Operating Income (Loss) before Depreciation and Amortization (16,635) 3,701 nm Amortization of non-cash stock compensation expense (1,026) (144) nm Depreciation and amortization (1,635) (2,054) 20.4% -------- -------- ------- OPERATING INCOME (LOSS) (19,296) 1,503 nm Interest income, net 319 395 -19.2% -------- -------- ------- INCOME (LOSS) BEFORE INCOME TAXES (18,977) 1,898 nm Income tax provision (189) (665) 71.6% -------- -------- ------- INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE LOSS FROM DISCONTINUED OPERATIONS (19,166) 1,233 nm -------- -------- ------- Loss from discontinued operations, net of tax benefit in 2003 (127) (302) 57.9% -------- -------- ------- NET INCOME (LOSS) $(19,293) $ 931 nm ======== ======== =======
Martha Stewart Living Omnimedia, Inc. Consolidated Statements of Operations Six Months Ended June 30, (in thousands, except per share amounts)
2004 2003 % change ---------- ---------- ---------- REVENUES Publishing $ 47,632 $ 73,678 -35.4% Television 7,233 13,203 -45.2% Merchandising 21,692 22,091 -1.8% Internet/Direct Commerce 11,978 14,833 -19.2% ---------- ---------- ---------- Total revenues 88,535 123,805 -28.5% ---------- ---------- ---------- OPERATING COSTS AND EXPENSES Production, distribution and editorial 59,352 71,049 -16.5% Selling and promotion 28,612 26,495 8.0% General and administrative 31,393 27,836 12.8% Amortization of non-cash stock compensation expense (b) 2,480 267 nm Depreciation and amortization 3,309 4,195 -21.1% ---------- ---------- ---------- Total operating costs and expenses 125,146 129,842 -3.6% ---------- ---------- ---------- OPERATING LOSS (36,611) (6,037) -496.5% Interest income, net 681 797 -14.6% ---------- ---------- ---------- LOSS BEFORE INCOME TAXES (35,930) (5,240) -574.2% Income tax benefit (provision) (3,332) 2,184 nm ---------- ---------- ---------- LOSS FROM CONTINUING OPERATIONS BEFORE LOSS FROM DISCONTINUED OPERATIONS (39,262) (3,056) nm ---------- ---------- ---------- Loss from discontinued operations, net of tax benefit in 2003 (288) (523) 44.9% ---------- ---------- ---------- NET LOSS $ (39,550) $ (3,579) nm ========== ========== ========== LOSS PER SHARE - BASIC AND DILUTED Loss from continuing operations $ (0.79) $ (0.06) Loss from discontinued operations (0.01) (0.01) ---------- ---------- Net Loss $ (0.80) $ (0.07) ========== ========== WEIGHTED AVERAGE SHARES OUTSTANDING Basic 49,518 49,560 Diluted 49,518 49,560
Martha Stewart Living Omnimedia, Inc. Segment Information Six Months Ended June 30, (in thousands)
2004 2003 % change -------- --------- -------- REVENUES Publishing $ 47,632 $ 73,678 -35.4% Television 7,233 13,203 -45.2% Merchandising 21,692 22,091 -1.8% Internet/Direct Commerce 11,978 14,833 -19.2% -------- --------- -------- Total revenues 88,535 123,805 -28.5% -------- --------- -------- OPERATING INCOME (LOSS) BEFORE DEPRECIATION AND AMORTIZATION Publishing (9,721) 14,490 nm Television (5,362) 1,008 nm Merchandising 12,208 15,204 -19.7% Internet/Direct Commerce (4,613) (12,335) 62.6% -------- --------- -------- Operating Income (Loss) before Depreciation (7,488) 18,367 nm and Amortization and Corporate Overhead Corporate Overhead (23,334) (19,942) -17.2% -------- --------- -------- Operating Loss before Depreciation and Amortization (30,822) (1,575) nm Amortization of non-cash stock compensation expense (2,480) (267) nm Depreciation and amortization (3,309) (4,195) 21.1% -------- --------- -------- OPERATING LOSS (36,611) (6,037) -506.4% Interest income, net 681 797 -14.6% -------- --------- -------- LOSS BEFORE INCOME TAXES (35,930) (5,240) -562.9% Income tax benefit (provision) (3,332) 2,184 nm -------- --------- -------- LOSS FROM CONTINUING OPERATIONS BEFORE LOSS FROM DISCONTINUED OPERATIONS (39,262) (3,056) nm -------- --------- -------- Loss from discontinued operations, net of tax benefit in 2003 (288) (523) 44.9% -------- --------- -------- NET LOSS $(39,550) $ (3,579) -1005.0% ======== ========= ========
Martha Stewart Living Omnimedia, Inc. Consolidated Balance Sheets (in thousands, except per share amounts)
June 30, December 31, 2004 2003 --------- --------- (unaudited) ASSETS CURRENT ASSETS Cash and cash equivalents $ 119,462 $ 165,566 Short-term investments 38,891 3,100 Accounts receivable, net 17,736 39,758 Inventories, net 9,234 7,485 Deferred television production costs 1,448 3,465 Income taxes receivable 5,771 5,658 Deferred income taxes, net 1,833 5,024 Other current assets 6,046 4,422 --------- --------- TOTAL CURRENT ASSETS 200,421 234,478 --------- --------- PROPERTY, PLANT, AND EQUIPMENT, net 19,870 22,673 --------- --------- INTANGIBLE ASSETS, net 44,257 44,257 --------- --------- DEFERRED INCOME TAXES 3,224 3,224 --------- --------- OTHER NONCURRENT ASSETS 4,440 4,470 --------- --------- TOTAL ASSETS $ 272,212 $ 309,102 ========= ========= LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES Accounts payable and accrued liabilities $ 24,663 $ 26,628 Accrued payroll and related costs 12,245 10,360 Income taxes payable 692 167 Current portion of deferred subscription income 23,532 23,833 --------- --------- TOTAL CURRENT LIABILITIES 61,132 60,988 --------- --------- DEFERRED SUBSCRIPTION INCOME 7,028 7,133 OTHER NONCURRENT LIABILITIES 4,211 4,316 --------- --------- TOTAL LIABILITIES $ 72,371 $ 72,437 --------- --------- COMMITMENTS AND CONTINGENCIES SHAREHOLDERS' EQUITY Class A common stock, $0.01 par value, 350,000 shares authorized: 20,328 and 19,628 shares issued in 2004 and 2003, respectively 203 196 Class B common stock, $0.01 par value, 150,000 shares authorized: 29,423 and 30,059 shares outstanding in 2004 and 2003, respectively 294 301 Capital in excess of par value 186,207 183,744 Unamortized restricted stock (44) (307) Retained earnings 13,956 53,506 --------- --------- 200,616 237,440 Less class A treasury stock - 59 shares at cost (775) (775) --------- --------- TOTAL SHAREHOLDERS' EQUITY 199,841 236,665 --------- --------- TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 272,212 $ 309,102 ========= =========
Martha Stewart Living Omnimedia, Inc. Supplemental Disclosures Regarding Non- GAAP Financial Information Three Months Ended June 30, (in thousands) The following table presents segment and consolidated financial information, including a reconciliation of operating income, a GAAP measure, and Operating Income before Depreciation and Amortization, including the amortization of non-cash stock compensation, (OIDA), a non-GAAP measure. In order to reconcile OIDA to operating income, depreciation and amortization are added back to operating income.
2004 2003 % change -------- -------- --------- OPERATING INCOME (LOSS) Publishing $ (5,321) $ 9,335 nm Television (3,531) 2 nm Merchandising 5,314 7,808 -31.9% Internet/ Direct Commerce (2,426) (4,552) 46.7% -------- -------- ------- Operating Income (Loss) before Corporate Overhead (5,964) 12,593 nm Corporate Overhead (13,332) (11,090) -20.2% -------- -------- ------- TOTAL OPERATING INCOME (LOSS) (19,296) 1,503 nm -------- -------- ------- DEPRECIATION AND AMORTIZATION Publishing 61 41 48.8% Television 59 385 -84.7% Merchandising 190 168 13.1% Internet/ Direct Commerce 249 244 2.0% Corporate Overhead 1,076 1,216 -11.5% -------- -------- ------- TOTAL DEPRECIATION AND AMORTIZATION 1,635 2,054 -20.4% -------- -------- ------- AMORTIZATION OF NON-CASH STOCK COMPENSATION Publishing 51 51 -- Television -- -- -- Merchandising 12 12 -- Internet/ Direct Commerce -- -- -- Corporate Overhead 963 81 nm -------- -------- ------- TOTAL AMORTIZATION 1,026 144 nm -------- -------- ------- OPERATING INCOME (LOSS) BEFORE DEPRECIATION AND AMORTIZATION AND AMORTIZATION OF NON-CASH STOCK COMPENSATION Publishing (5,209) 9,427 -155.3% Television (3,472) 387 nm Merchandising 5,516 7,988 -30.9% Internet/ Direct Commerce (2,177) (4,308) 49.5% -------- -------- ------- Operating Income (Loss) before Depreciation and Amortization, Amortization of Non- Cash Stock Compensation and before Corporate Overhead (5,342) 13,494 nm -------- -------- ------- Corporate Overhead (11,293) (9,793) -15.3% OPERATING INCOME (LOSS) BEFORE DEPRECIATION AND AMORTIZATION AND AMORTIZATION OF NON- CASH STOCK COMPENSATION $(16,635) $ 3,701 nm -------- -------- -------
Martha Stewart Living Omnimedia, Inc. Supplemental Disclosures Regarding Non- GAAP Financial Information Six Months Ended June 30, (in thousands) The following table presents segment and consolidated financial information, including a reconciliation of operating income, a GAAP measure, and Operating Income before Depreciation and Amortization, including the amortization of non-cash stock compensation, (OIDA), a non-GAAP measure. In order to reconcile OIDA to operating income, depreciation and amortization are added back to operating income.
2004 2003 % change -------- -------- -------- OPERATING INCOME (LOSS) Publishing $ (9,946) $ 14,306 nm Television (5,478) 229 nm Merchandising 11,803 14,842 -20.5% Internet/ Direct Commerce (5,105) (12,804) 60.1% -------- -------- ------ Operating Income (Loss) before Corporate Overhead (8,726) 16,573 nm Corporate Overhead (27,885) (22,610) -23.3% -------- -------- ------ TOTAL OPERATING LOSS (36,611) (6,037) nm -------- -------- ------ DEPRECIATION AND AMORTIZATION Publishing 123 82 50.0% Television 116 779 -85.1% Merchandising 380 337 -12.8% Internet/ Direct Commerce 492 491 -.2% Corporate Overhead 2,198 2,506 -12.3% -------- -------- ------ TOTAL DEPRECIATION AND AMORTIZATION 3,309 4,195 -21.1% -------- -------- ------ AMORTIZATION OF NON-CASH STOCK COMPENSATION EXPENSE (BENEFIT) Publishing 102 102 -- Television -- -- -- Merchandising 25 25 -- Internet/ Direct Commerce -- (22) nm Corporate Overhead 2,353 162 nm -------- -------- ------ TOTAL AMORTIZATION 2,480 267 nm -------- -------- ------ OPERATING INCOME (LOSS) BEFORE DEPRECIATION AND AMORTIZATION AND AMORTIZATION OF NON-CASH STOCK COMPENSATION Publishing (9,721) 14,490 nm Television (5,362) 1,008 nm Merchandising 12,208 15,204 -19.7% Internet/ Direct Commerce (4,613) (12,335) 62.6% -------- -------- ------ Operating Income (Loss) before Depreciation and Amortization, Amortization of Non-Cash Stock Compensation and before Corporate Overhead (7,488) 18,367 nm -------- -------- ------ Corporate Overhead (23,334) (19,942) -17.0% -------- -------- ------ OPERATING LOSS BEFORE DEPRECIATION AND AMORTIZATION AND AMORTIZATION OF NON-CASH STOCK COMPENSATION $(30,822) $ (1,575) nm -------- -------- ------
Martha Stewart Living Omnimedia, Inc. Supplemental Disclosures Regarding Allocation of Amortization of non-cash Stock Compensation Expense Three and Six Months Ended June 30, (in thousands) (a) The amortization of non-cash stock compensation expense for the three month periods ended June 30, should be allocated as follows:
2004 2003 ------ ---- Production, distribution and editorial $ 25 $ 25 Selling and promotion 25 25 General and administrative 976 94 ------ ---- TOTAL 1,026 144 ====== ====
(b) The amortization of non-cash stock compensation expense for the six month periods ended June 30, should be allocated as follows:
2004 2003 ------ ---- Production, distribution and editorial $ 50 $ 50 Selling and promotion 50 50 General and administrative 2,380 167 ------ ---- TOTAL 2,480 267 ====== ====
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