NEW YORK, May 6, 2014 /PRNewswire/ -- Martha Stewart Living Omnimedia, Inc. (NYSE: MSO) today announced its results for the first quarter ended March 31, 2014. The Company reported revenue for the first quarter of $33.3 million.

Dan Dienst, Chief Executive Officer, said, "First quarter results reflect the current transition underway at the Company as we start to benefit from the significant changes we made at the end of 2013 to realign our business. We still have work to do but are encouraged by the early results of these decisions. Our efforts in 2014 are now keenly focused on growing our business across all verticals and with existing and new partners. As a company of ideas and inspirations, we are excited about the future growth for our peerless brand."

First Quarter 2014 Summary

Revenues totaled $33.3 million in the first quarter of 2014, compared to $37.2 million in the first quarter of 2013, due largely to lower digital and print advertising revenues.

Total operating loss for the first quarter of 2014 was $(2.2) million compared to a loss of $(3.0) million in the prior-year period. The first quarter of 2013 included a net gain on the sale of a subscriber list of $2.7 million.

Basic and diluted net income per share was $(0.05) for both the first quarter of 2014 and 2013. Included in this year's first quarter results is the planned $2.1 million accelerated amortization related to vacating space in the Company's headquarters.

First Quarter 2014 Results by Segment


             Three Months Ended March 31,

              (unaudited, in thousands)





                                     2014

                                                                 2013
                                                                 ----

    REVENUES

    Publishing                    $19,506                     $24,482

    Merchandising                  13,084                      11,507

    Broadcasting                      678                       1,235

    Total Revenues                $33,268                     $37,224
                                  -------                     -------



    OPERATING (LOSS) / INCOME

    Publishing                    $(2,750)                      $(990)

    Merchandising                   9,300                       5,686

    Broadcasting                      193                         961

    Corporate                      (8,933)                     (8,702)
                                   ------                      ------

    Total Operating Loss          $(2,190)

                                            $(3,045)

Recent Business Highlights


    --  MSLO's media properties have been nominated and have won several
        prestigious awards this quarter: Martha Stewart's Cooking School
        recently won a James Beard Award, which is the highest honor for food
        and beverage professionals; Martha Stewart Living was nominated for two
        National Magazine Awards, for General Excellence (Service & Lifestyle)
        and for Design; Martha Stewart Living was also named a Society of
        Publication Designers' Medal Finalist, which is the world's most
        prestigious editorial design competition; and MSLO recently won a Webby
        People's Voice Award in the lifestyle category and was also nominated
        for two of Media Industry Newsletter's Digital Awards -- both are top
        honors in the digital industry.
    --  We continue to have a growing presence on PBS as the third season of
        Martha Bakes began airing last month. Together, Martha Bakes and
        Martha's Cooking School draw a total of 1.8 million viewers a week.

Publishing

Revenues in the first quarter of 2014 were $19.5 million, compared to $24.5 million in the prior year's first quarter. The decline in revenue is due to lower digital advertising revenue and the absence of Whole Living, a supplement issue of Everyday Food and a special issue publication in the quarter.

Operating loss was $(2.8) million for the first quarter of 2014, compared to $(1.0) million in the prior year. Last year's first quarter results included the non-recurring gain of $2.7 million associated with the sale of our Whole Living subscriber list.

Merchandising

Revenues increased 14% to $13.1 million for the first quarter of 2014, as compared to $11.5 million in the prior year's first quarter, due mainly to non-cash revenue from J.C. Penney's return of MSO shares and the recognition of J.C. Penney's minimum royalties with no comparable revenue in the first quarter of 2013.

Operating income was $9.3 million for the first quarter of 2014 as compared to $5.7 million in the first quarter of 2013.

Broadcasting

Revenue in the first quarter of 2014 was $0.7 million, compared to $1.2 million in the first quarter of 2013, primarily due to non-recurring revenue components in the prior year related to our historical Broadcasting operations.

Operating income was $0.2 million for the first quarter of 2014 compared to operating income of $1.0 million in the first quarter of 2013.

Corporate

Corporate expenses were $(8.9) million in the first quarter of 2014 compared to $(8.7) million in the prior year's quarter, due to the expected $2.1 million charge of accelerated amortization related to vacating space in the Company's headquarters.

The Company will host a conference call with analysts and investors on May 6, 2014 at 8:30am EDT that will be broadcast live over the Internet at www.marthastewart.com/ir, and an archived version will be available through May 20, 2014.

About Martha Stewart Living Omnimedia, Inc.

Martha Stewart Living Omnimedia, Inc. (MSLO) is a leading provider of original "how-to" information, inspiring and engaging consumers with unique lifestyle content and well-designed, high-quality products. MSLO is organized into the following business segments: Publishing, Merchandising and Broadcasting. MSLO is listed on the New York Stock Exchange under the ticker symbol MSO.

Forward-Looking Statements

This press release may contain certain statements that we believe are, or may be considered to be, "forward-looking statements," as that term is defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements are based on current expectations and are indicated by words or phrases such as "anticipate," "estimate," "expect," "intend," "believe," "continue," "potential" or similar words or phrases and involve known and unknown risks, uncertainties, and other factors which may cause actual results, performance, or achievements to be materially different from the future results, performance, or achievements expressed in or implied by such forward-looking statements.

Such forward-looking statements include: the continued success of our brands and the reputation and popularity of Martha Stewart and Emeril Lagasse; adverse reactions to publicity relating to Ms. Stewart or Mr. Lagasse by consumers, advertisers and business partners; loss of the services of Ms. Stewart or Mr. Lagasse; continued management turnover; our ability to successfully implement our growth strategies; our ability to develop new or expand existing merchandising and licensing programs or the loss or failure of existing programs, including as a result of litigation or disputes with our partners; failure to predict, respond to and influence trends in consumer taste; our inability to successfully and profitably develop or introduce new products and services; softening of or increased competition for advertising revenues, including increased competitive pressure on digital display advertising rates as a result of programmatic buying of advertising inventory; inability to successfully capitalize on digital, mobile and video initiatives, including establishing relationships with additional distribution partners; our ability to drive and retain visitors to our digital platforms and to effectively monetize our digital platforms; disruption in the industries in which our publishing and digital third-party vendors operate; continued weak and uncertain worldwide economic conditions; increases in paper, postage, freight or printing costs; weakening in circulation, particularly in newsstand sales; failure to protect our intellectual property; and failure to realize expected efficiencies and benefits from our restructuring activities.

Certain of these and other factors are discussed in more detail in the Company's most recent Annual Report on Form 10-K and Quarterly Reports on Form 10-Q filed with the Securities and Exchange Commission, especially under the heading "Risk Factors," which may be accessed through the SEC's website at http://www.sec.gov/.


                              Martha Stewart Living Omnimedia, Inc.

                              Consolidated Statements of Operations

                                  Three Months Ended March 31,

                  (unaudited, in thousands, except share and per share amounts)



    REVENUES                                              2014                        2013
                                                          ----                        ----

       Publishing                                      $19,506                     $24,482

       Merchandising                                    13,084                      11,507

       Broadcasting                                        678                       1,235
                                                           ---                       -----

    Total revenues                                      33,268                      37,224
                                                        ------                      ------


    Production,
     distribution
     and editorial                                     (15,413)                    (20,614)

    Selling and
     promotion                                          (8,097)                     (9,651)

    General and
     administrative                                     (8,909)                    (11,203)

    Depreciation
     and
     amortization                                       (3,039)                       (967)

    Restructuring
     charges                                                 -                        (523)

    Gain on sale
     of subscriber
     list, net                                               -                       2,689
                                                           ---                       -----


    OPERATING LOSS                                      (2,190)                     (3,045)


    Interest
     income, net                                            62                         204

    Other expense,
     net                                                  (494)                        (70)
                                                          ----                         ---


    LOSS BEFORE
     INCOME TAXES                                       (2,622)                     (2,911)


    Income tax
     benefit /
     (provision)                                            19                        (362)
                                                           ---                        ----


    NET LOSS                                           $(2,603)                    $(3,273)
                                                       =======                     =======


    LOSS PER SHARE
     -BASIC AND
     DILUTED

    Net loss                                            $(0.05)                     $(0.05)
                                                        ======                      ======


    WEIGHTED
     AVERAGE
     COMMON SHARES
     OUTSTANDING

    Basic and
     diluted                                        56,680,826                  67,241,626


                                                                                                   Martha Stewart Living Omnimedia, Inc.

                                                                                                        Consolidated Balance Sheets

                                                                                             (in thousands, except share and per share amounts)


                                                                                                                                                 March 31,            December 31,
                                                                                                                                                                2014                   2013
                                                                                                                                                (unaudited)
                                                                                                                                                ----------

    ASSETS

    CURRENT ASSETS

              Cash and cash equivalents                                                                                                                      $18,014                $21,884

              Short-term investments                                                                                                                          42,107                 19,268

              Restricted cash and investments                                                                                                                  5,015                  5,072

              Accounts receivable, net                                                                                                                        19,795                 39,694

              Paper inventory                                                                                                                                  2,034                  2,901

              Other current assets                                                                                                                             3,076                  3,876

                                                Total current assets                                                                                          90,041                 92,695
                                                                                                                                                              ------                 ------


    PROPERTY AND EQUIPMENT, net                                                                                                                                5,209                  7,961

    GOODWILL                                                                                                                                                     850                    850

    OTHER INTANGIBLE ASSETS, net                                                                                                                              45,200                 45,200

    OTHER NONCURRENT ASSETS                                                                                                                                    1,548                  1,661
                                                                                                                                                               -----                  -----


                                                 Total assets                                                                                               $142,848               $148,367
                                                                                                                                                            ========               ========


    LIABILITIES AND SHAREHOLDERS' EQUITY

    CURRENT LIABILITIES

              Accounts payable and accrued liabilities                                                                                                       $11,828                $12,464

              Accrued payroll and related costs                                                                                                                5,174                  8,665

              Current portion of deferred subscription revenue                                                                                                 7,020                  7,632

              Current portion of other deferred revenue                                                                                                       20,052                 17,227

                                                 Total current liabilities                                                                                    44,074                 45,988
                                                                                                                                                              ------                 ------


    DEFERRED SUBSCRIPTION REVENUE                                                                                                                              2,817                  3,587

    OTHER DEFERRED REVENUE                                                                                                                                    15,212                 17,307

    DEFERRED INCOME TAX LIABILITY                                                                                                                              7,040                  7,094

    OTHER NONCURRENT LIABILITIES                                                                                                                               3,889                  3,916

                                                 Total liabilities                                                                                            73,032                 77,892
                                                                                                                                                              ------                 ------


    COMMITMENTS AND CONTINGENCIES


    SHAREHOLDERS' EQUITY

              Class A Common Stock, $0.01 par value, 350,000,000 shares

              authorized: 31,218,064 and 30,704,491 shares issues in 2014 and

              2013, respectively; 31,158,664 and 30,645,091 shares outstanding

              in 2014 and 2013, respectively                                                                                                                     312                    307

              Class B Common Stock, $0.01 par value, 150,000,000 shares

              authorized: 25,734,625 and 25,984,625 shares issued and

              outstanding in 2014 and 2013, respectively                                                                                                         257                    260

              Capital in excess of par value                                                                                                                 343,702                342,213

              Accumulated deficit                                                                                                                           (273,654)              (271,051)

              Accumulated other comprehensive loss                                                                                                               (26)                  (479)
                                                                                                                                                                 ---                   ----

                                                                                                                                                              70,591                 71,250
                                                                                                                                                              ------                 ------

              Less: Class A treasury stock - 59,400 shares at cost                                                                                              (775)                  (775)
                                                                                                                                                                ----                   ----

                                                  Total shareholders' equity                                                                                  69,816                 70,475
                                                                                                                                                              ------                 ------

                                                  Total liabilities and shareholders' equity                                                                $142,848               $148,367
                                                                                                                                                            ========               ========

SOURCE Martha Stewart Living Omnimedia, Inc.