11.07.12
Blyth, Inc. reported earnings for the third quarter.Net sales for the three months ended Sept. 30, 2012 increased 40% to $268.8 million primarily due to the 132% year-over-year sales growth at ViSalus.
On Oct. 29, after the close of the third quarter, the company announced the sale of its Sterno subsidiary to Candle Lamp Company LLC for $23.5 million in cash, completing Blyth's strategic transformation from a multi-channel marketing company to a direct-to-consumer marketing company focused on the direct selling and direct marketing channels of distribution.As such, Sterno's operating results have been presented as discontinued operations for all periods shown.
Total PartyLite third quarter sales fell 21% to $69.5 million, reflecting the lack of consumer resiliency in the face of economic uncertainty, exacerbated by unfavorable currency movement, according to the company.PartyLite's US sales declined 16% largely due to the ongoing consumer malaise in North America. Active US independent sales consultants total over 13,000 in the region this year versus over 16,000 last year. At PartyLite Canada, sales declined 25% in both local currency and in US dollars during the quarter, with active independent sales consultants totaling over 3,000 this year versus approximately 4,000 last year.
Commenting on the third quarter performance, Robert B. Goergen, Jr., president, PartyLite Worldwide said, "The economic and geo-political uncertainty in Europe, which has cast a negative shadow of sentiment throughout 2012, contributed to our consultants' adopting a short-term focus.As they pursued individual sales results, it was at the expense of investing in their future success by not effectively leveraging their efforts to build their teams.And, while this approach has resulted in higher individual productivity, as measured by average order size, it has temporarily sacrificed the longer-term benefits of building a healthy and substantive downline organization.As such, we have redirected much of our sales commissioning, promotional messaging and leadership training to assist those consultants that are newer to the business so that they can focus on the lasting results of successful recruiting and team building, and to remain engaged in this difficult economic environment."
Turning to the US market, Goergen continued, "We continue to have a very strong product offering which contains new fragrances and forms including, most notably, our extended line of translucent GloLite by PartyLite candles, and have implemented a number of initiatives to stabilize and revitalize the PartyLite business in the US. While still early in the process, these efforts are contributing to a moderation in the recent sales decline, but are incomplete in stabilizing and returning the North American business to growth.As such, we are not only moving forward with exciting new product launches in Q4 and the first half of 2013, but also continuing to invest in compelling tools for our consultants to leverage their efforts in both sponsoring and personal sales.
"Further, we are aggressively moving forward with similar and robust initiatives in Europe, including the implementation of online ordering, which today comprises 25% of US sales, and the establishment of consultant websites to facilitate complementary sales.While the party plan format remains essential to the PartyLite business, successful direct sellers today are reaching their customers in a variety of ways and PartyLite is ensuring its consultants have the tools and online applications necessary to accomplish this."
"Further, we are aggressively moving forward with similar and robust initiatives in Europe, including the implementation of online ordering, which today comprises 25% of US sales, and the establishment of consultant websites to facilitate complementary sales.While the party plan format remains essential to the PartyLite business, successful direct sellers today are reaching their customers in a variety of ways and PartyLite is ensuring its consultants have the tools and online applications necessary to accomplish this."