Operating under a new name and new strategic vision, losses continued at cable shopping network ShopHQ during the second quarter, but at a slower pace.
Parent company iMedia Brands Inc., formerly known as Evine, reported Wednesday that it lost $10.2 million during the quarter, or 13 cents per share, compared with a year ago when it nearly broke even.
Sales at the retailer’s TV, website and digital channels totaled $131.5 million, a drop of 12.8% from the same period a year ago.
The company expects sales to continue to slide at ShopHQ in the third and fourth quarters, as it continues to narrow the gap and improve operations.
Tim Peterman, the former chief financial officer who took over as chief executive of the Eden Prairie-based home-shopping network in May, said during a morning earnings call that ShopHQ “still had a lot of fixing to do” on sales and gross-profit margins, which also declined in the quarter.
But he said early turnaround efforts have “arrested” the retailer’s nine-month, $33 million decline in operations, as measured by its adjusted earnings before interest, taxes, depreciation and amortization.
The gains came as leaders slashed $15 million in annual overhead, laying off 20% of salaried workers and 11 senior executives in May. The move will cost $5.2 million in severance this year, with $2 million going to former CEO Bob Rosenblatt, who retains a seat on the board of directors.
There were signs that iMedia might not be simply cutting its way toward profitability. The average selling price was $68, a 24% jump from this time last year, led by sales of higher-margin items such as jewelry and beauty. Watches were the top performing category, jumping 18.4% compared with last year.
Peterman aims to position ShopHQ as a niche player against much-larger rivals HSN and QVC. His team has begun adjusting the merchandise mix away from home decor and apparel, where competitors have most of the market share, to focus ShopHQ on jewelry, wellness and beauty.
A male-focused shopping and entertainment channel named Bulldog will launch in November out of the company’s Eden Prairie studios, Peterman said. A Spanish language network, LaVenta, will follow in March 2020.
LaVenta will broadcast from existing space at the Miami headquarters of iMedia’s largest vendor partner, Invicta Watch Group.
Invicta CEO Eyal Lalo and his investment company took charge of the struggling retailer in May, with a $6 million stock deal that put Peterman in charge and gave Lalo and other supporters a spot on the board of directors.