QVC Revenue +6% But Jewelry Sales Weaken

QVC’s revenue for the third quarter, which ended on September 30, rose 6 percent year on year to $1.9 billion, led by a 14 percent increase in international sales of $690 million. U.S. sales rose only 2 percent to $1.2 billion. QVC’s overall product mix showed steady growth for electronics, accessories, beauty and kitchen, however, jewelry sales declined. QVC’s operating income declined slightly to $234 million, but its parent company, Liberty Interactive Corporation, recorded a loss. QVC’s outstanding bank and bond debt was $2.5 billion as of September 30.

QVC’s international revenue benefitted from favorable exchange rates. QVC U.K.’s revenue decreased 4 percent year on year in local currency and sales of jewelry and electronics fell during the quarter. QVC Germany’s revenue grew 8 percent in local currency and jewelry sales were strong. QVC Japan’s revenue grew 4 percent in local currency. The newest channel, QVC Italy, recorded a 61 percent increase in sequential sales growth from the previous quarter.

Mike George, QVC’s president, said, ”We saw continued strong growth in Germany, encouraging gains in Japan, and growing momentum in Italy. Excluding the previously discussed change in our QCard program with GE Capital Retail Bank, our adjusted OIBDA growth would have been up 2 percent, this on top of 8 percent in growth last year. Our e-commerce worldwide revenue grew 19 percent and now represents 30 percent of QVC’s consolidated net revenue. Revenue from new customers grew 29 percent in the U.S., representing our highest growth rate since 2009. QVC remains focused on growing sales and gaining share in the current retail environment by offering differentiated and compelling products, engaging our customers on all the screens and devices they interact with daily, and expanding globally.”

Greg Maffei, Liberty Interactive’s president, said, “QVC continued to produce solid results, in a challenging macroeconomic environment with particularly strong performance in Japan and Germany. We were very pleased to complete the split-off of Liberty Capital and Liberty Starz on September 23rd, making Liberty Interactive a standalone company. And we took advantage of the soft equity markets and agreed to increase our stake in HSN and repurchased almost $173 million of Liberty Interactive stock.”

Liberty Interactive’s revenue increased 8 percent year on year to $2.1 billion and the company reported a $19 million loss attributable to shareholders, compared with profit of $179 million one year ago.

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