Liberty Interactive Misses 1Q Earnings

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Liberty Interactive Corp. (LINTA) reported mixed financial results for the first quarter of 2013. Quarterly net income was $27 million or 18 cents per share compared with $91 million or 16 cents per share in the year-ago quarter. First-quarter 2013 earnings per share of 18 cents fell below the Zacks Consensus Estimate of 21cents. Quarterly total revenue of $2,434 million reflected a yearly improvement of 5% and well above the Zacks Consensus Estimate of $2,337 million.

Quarterly total operating income came in at $260 million as opposed to $259 million in the year-ago quarter. In the reported quarter, consolidated adjusted OIBDA came in at $437 million compared with $419 million in the year-ago quarter. In the reported quarter, Liberty Interactive repurchased approximately 12.6 million Class A shares for a total consideration of $267.1 million.  

In the first quarter of 2013, Liberty Interactive generated $92million of cash compared with $330 million in the year-ago quarter. Free cash flow in the reported quarter was $33 million compared with $262 million in the prior-year quarter.

At the end of the first quarter of 2013, Liberty Interactive had total consolidated cash and marketable securities of $3,747 million compared with $4,479 million at the end of 2012. Liberty Interactive exited the reported quarter with $7,875 million of outstanding debt compared with $7,884 million at the end of 2012. The debt-to-capitalization ratio was 0.48 at the end of the first-quarter 2013 compared with 0.45 at the end of 2012.

According to a report of Internet Retailer, after Amazon.com Inc. (AMZN), QVC was the second-largest e-commerce retailer of the U.S. in 2012. QVC has become the market leader in the $8 billion TV home-shopping business commanding an estimated 69% market share, far ahead of its nearest rivals, HSN Inc. (HSNI) and ValueVision Media Inc. (VVTV). Liberty Interactive currently has a Zacks Rank #3 (Hold).  

QVC Segment

Quarterly total revenue of the QVC segment was $1,974 million, up 2.2% year over year. Consolidated adjusted OIBDA was $404 million, up 3.6% year over year. Consolidated operating income was $260 million, up 0.8% year over year.

Quarterly revenues of QVC U.S. inched up 4.6% year over year to $1,297 million. Gross margin was 36.1% compared with 35.6% in the year-ago quarter. Adjusted OIBDA was $291 million, up 7.8% year over year. Operating income was $180 million, up 5.3% year over year.

Quarterly revenues of QVC International inched down 2.2% year over year to $677 million. Gross margin was 37.5% compared with 37.7% in the year-ago quarter. Adjusted OIBDA was $113 million, down 5.8% year over year. Operating income was $80 million, down 8.1% year over year.

eCommerce Segment

Quarterly revenues of the eCommerce Business segment were $460 million, up 20% year over year. Quarterly adjusted OIBDA was $39 million, up 15% year over year. Operating loss was $19 million, in the reported quarter, in contrast to an operating income of $15 million in the prior-year quarter.

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