A decline in magazine advertising marred earnings for Martha Stewart Living Omnimedia in the final quarter of 2004, the company said Wednesday, as its namesake founder served the final two weeks of her prison sentence.
The New York-based company, which stamps Stewart’s name on products from magazines to pots, also warned that losses for the first quarter of 2005 will be larger than analysts expected.
President and chief executive Susan Lyne called 2004 “a year of significant challenge.”
Stewart, the former chief executive, was convicted last March for lying to investigators about her sale of ImClone Systems stock. She is winding up her five-month prison term and will serve another five months of house arrest after her release March 6.
The company lost $7.3 million, or 15 cents per share, for the three months that ended Dec. 31, compared with a profit of $2.4 million, or 5 cents per share, in the same period a year ago. Analysts surveyed by Thomson First Call had expected a 17-cent loss.
Advertising revenue at Martha Stewart Living magazine fell on fewer advertising pages and lower rates. Circulation revenue also fell.
In the first quarter of 2005, the company expects to post a loss of 35 cents. Analysts have been expecting a 20-cent loss.
The company has not detailed what role Stewart, who owns about 60 percent of its shares, will have in the future. She has two television deals, one for a revised version of her daily homemaking show, to start in September, and the other for Stewart’s own version of “The Apprentice.”
