As a rocky year ends, Evine Live makes money and cuts costs, including 45 jobs

Evine Live Inc. edged back into profitability at the end of a tumultuous fiscal year that, after it finished, led to another management shake-up and job cuts.

The company's shares rose 7 percent Wednesday after the home-shopping retailer announced a marginal profit and $5 million in expense reductions, including layoffs of 45 workers.

Bob Rosenblatt, the company's chairman who also became interim chief executive last month, said the cuts included its top merchandiser and extended to operations beyond its headquarters and main studio in Eden Prairie.

"They ranged in high-level positions all the way down," Rosenblatt said in a conference call with analysts. "It was done in a surgical manner."

The company earned $700,000, or one cent a share, in the fiscal fourth quarter ended Jan. 30. While that was down from $3.3 million, or 6 cents a share, a year ago, it was a recovery from losses in much of last year.

Sales grew 5 percent to $211.5 million, the biggest gain of the year and higher than the $210 million that was expected by analysts. Operating expenses also rose 5 percent, which chief financial officer Tim Peterman attributed to costs for network expansion and various fees.

The company forecast 2016 sales growth in line with the 3 percent it achieved for the full 2015 fiscal year.

In November, when it reported third-quarter results, then-chief executive Mark Bozek said long-term growth would result from accepting what he called "competitive margins." Investor pressure mounted and, over the year, the company's stock lost 95 percent of its value. Last month, directors removed Bozek and put Rosenblatt, who has been on the company's board for two years, in charge of day-to-day operations while a search is conducted for a new CEO.

A former top executive of the company's rival, HSN, as well as the department store giant Bloomingdale's, Rosenblatt said Bozek corrected the previous management's mistakes in merchandising and programming. But he said Bozek and his team didn't pay close enough attention to how their moves were affecting profits.

"When I think about the next leader, I think it is somebody who really needs to understand what the levers of the businesses are, how to continue to build the culture out to be appropriate, how to put the disciplines in place to be measurable," Rosenblatt said.

In a report after the news, Mark Argento, analyst at Lake Street Capital in Minneapolis, said Bozek's strategy was heading in the right direction but was hampered in part by its ambition and speed. "We believe the new merchandising strategy enacted by former management was on point and will now be enhanced by the focus to drive increased profitability of the new interim CEO," Argento wrote.

The erosion of Evine Live's profit margin appeared to slow, falling to 31.4 percent in the latest quarter from 32.6 percent a year ago.

The company is in the process of selling some of the radio spectrum assigned to its Boston television station in an auction process set up by the Federal Communications Commission, which is trying to free up airspace for other uses. It was unclear how much it would gain from the sale, executives said.