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ValueVision Media Inc. Reports Operating Results (10-K)
Posted by: gurufocus (IP Logged)
Date: April 5, 2012 05:48PM

ValueVision Media Inc. (VVTV) filed Annual Report for the period ended 2012-01-28. Valuevision Cla has a market cap of $100.5 million; its shares were traded at around $1.9 with and P/S ratio of 0.2.



Highlight of Business Operations:

Consolidated net sales in fiscal 2011 were $558.4 million compared to $562.3 million in fiscal 2010, a 1% decrease. Consolidated net sales in fiscal 2010 were $562.3 million compared to $527.9 million in fiscal 2009, a 7% increase. We reported an operating loss of $16.8 million and a net loss of $48.1 million for fiscal 2011. Our net loss in fiscal 2011 included a $25.7 million non-cash debt extinguishment charge. We reported an operating loss of $15.5 million and a net loss of $25.9 million for fiscal 2010. Operating expenses in fiscal 2010 included $1.1 million of restructuring charges and a $1.2 million debt extinguishment charge. We reported an operating loss of $41.2 million and a net loss of $42.0 million for fiscal 2009, which included a pretax

Distribution and selling expense for fiscal 2011 increased $7.3 million, or 4%, to $188.8 million, or 34% of net sales compared to $181.5 million, or 32% of net sales in fiscal 2010. Distribution and selling expense increased from fiscal 2010 primarily due to increased program distribution fees of $4.2 million related to a 4% increase in average homes during the year and improved

channel positions obtained in certain markets. Distribution and selling expense also increased during fiscal 2011 as a result of increased credit card fees and bad debt expense of $3.0 million, increased salary and consulting costs of $1.4 million and increased share based compensation expense of $1.2 million. These distribution and selling expense increases during the year were offset by decreases in advertising and promotion expense of $1.8 million and decreases in customer service and telecommunication expenses of $300,000. Distribution and selling expense for fiscal 2010 increased $3.5 million, or 2%, to $181.5 million, or 32% of net sales compared to $178.0 million, or 34% of net sales, in fiscal 2009 primarily due to a $2.6 million increase in cable and satellite fees resulting from an increase in the number of homes broadcasted to during fiscal 2010 and certain contractual rate increases, partially offset by retroactive billing adjustments from certain carriers. Distribution and selling expense also increased during fiscal 2010 as a result of increased credit card fees and bad debt expense of $3.8 million due to the overall increase in net sales and order transactions over fiscal 2009 and increased salaries, bonuses and consulting costs of $400,000. Distribution and selling expense increases were offset by decreases in customer service and telecommunication expenses of $2.0 million, decreases in advertising and promotion expense of $1.7 million and a decrease in third-party cable affiliation fees of $100,000.

General and administrative expense for fiscal 2011 increased $371,000, or 2%, to $19.5 million of net sales compared to $19.2 million or 3.4% of net sales in fiscal 2010. General and administrative expense increased from fiscal 2010 primarily due to increased share-based compensation of $296,000 and board of directors fees of $399,000, offset by a $412,000 gain recorded on the disposal of a piece of operational equipment. General and administrative expense for fiscal 2010 increased $798,000, or 4%, to $19.2 million, or 3.4% of net sales compared to $18.4 million, or 3.5% of net sales in fiscal 2009. General and administrative expense increased from fiscal 2009 primarily as a result of an increase in salaries and related benefits and consulting fees totaling $1.0 million, increased share-based compensation expense of $220,000 and decreased cash payment discounts received of $246,000, offset by decreases in legal expenses of $708,000.

Depreciation and amortization expense was $12.6 million, $13.2 million and $14.3 million for fiscal 2011, fiscal 2010 and fiscal 2009, respectively, representing a decrease of $0.6 million, or 4%, from fiscal 2010 to fiscal 2011 and a decrease of $1.1 million, or 8%, from fiscal 2009 to fiscal 2010. Depreciation and amortization expense as a percentage of net sales was 2.3%, 2.3%, and 2.7% for fiscal 2011, fiscal 2010 and fiscal 2009, respectively. The 2011 decrease in depreciation and amortization expense is due to a reduction in our depreciable asset base year over year which resulted from our Oracle11i upgrade becoming fully depreciated during fiscal 2010, offset by increased amortization expense attributable to our renewed NBC trademark license. The 2010 decrease in depreciation and amortization expense relates to reduced capital spending and the timing of fully depreciated assets year over year and reduced amortization of our NBC distribution agreement due to the expiration of this agreement.

Read the The complete Report



Stocks Discussed: VVTV,
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