As earnings for Martha Stewart Living Omnimedia (New York) fell 42 percent in the third quarter, the company predicted an even steeper decline for the rest of the year.
Blaming most of the problems on the stock-trading investigation of Stewart, company executives indicated that the company is paying more to retain employees and to defend itself as the investigations continue. In addition, subscription renewals for its principal magazine, Martha Stewart Living, are weak, and sales of Martha Stewart Everyday products at Kmart declined 6.9 percent in the quarter from a year earlier.
Kmart Corp. (Troy, Mich.) announced that October same-store sales fell 1.2 percent, hurt by the volume of clearance merchandise. Total sales for the four weeks ended Oct. 25, 2002, were relatively flat. However, the bankrupt discount mass-merchandiser also saw a 1.4 percent increase in same-store sales for the quarter ending October 25, with net sales up 3 percent.