A mere five months since taking over as chief executive of Martha Stewart Living Omnimedia (MSLO), recently hired former president and COO of Oxygen Media Lisa Gersh is taking her last few breaths as head of Stewart’s namesake empire.
Through a memo to staffers, media maven Martha Stewart and Gersh announced jointly that Gersh will step down after a short transition period. The move spurred the company’s shares to slide to a multiyear low and has analysts speculating that Gersh’s executive suite exit could simply be the unfortunate reaction to Stewart’s heavy-handed management style.
As the company kicks off a search for another fresh face, MSLO is working to pare down its publishing business by cutting jobs and by pulling its Everyday Food magazine off the presses for occasional bundling with its flagship Martha Stewart Living publication. The media company’s publishing activities generate about 64% of sales along with merchandising (22%) and broadcasting (14%).
MSLO has been reshuffling its operations in recent months to shed $47 million in annual operating costs. It also announced plans to restructure its broadcast TV division and sell off its Whole Living health and lifestyle magazine. The company is also focused on boosting its merchandising revenue, which in Q4 2012 is tracking to a 15% rise vs. the same reporting period in 2011.
Meanwhile, 70%-owner, non-executive chairman, and chief creative officer Martha Stewart continues to receive $2 million in salary and bonus, which, agreed, doesn’t go far in New York. But MSLO also foots a $2.1 million bill for use of her homes and studios.
Revenue losses continue to widen at the domestic diva’s media company. Its primary publishing business is growing anemic as ad revenues decline. For the period ended September 30, MSLO reported losses of $50.9 million vs. a loss of $9.7 million in 2011. Something’s gotta give for investors to see Martha’s media company as a good thing.