ST. PETERSBURG, Fla.-An $18.3 million charge for a loss on extinguishment of debt reduced HSNi’s third-quarter net income by 27.2 percent, to $17.7 million.
This charge was one of the few negatives for the company’s third quarter, which ended on Sept. 30. Net sales increased 7 percent to $778.8 million, receiving a significant boost from HSNi’s Cornerstone division, whose sales jumped 13 percent. Part of the gain at Cornerstone, whose business includes catalogs and digital sales websites, was growth in sales of home-related products.
Gross margin rose 67 points to 36.7 percent as well. Selling, general and administrative expenses increased 11 percent in dollars and 103 basis points as a percentage of sales, to 28.1 percent. Along with the charge for debt extinguishment, HSNi posted an increase of 180.1 percent in “other” expenses.
Focusing on the sales gain, Mindy Grossman, HSNi’s CEO, said it was the result of “the sustained effectiveness of our overall strategy of creating immersive experiences, offering differentiated products and leveraging technology to build relationships, not just transactions.”