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Table of Contents
HSN, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE 17—SHAREHOLDERS’ EQUITY
In December 2008, HSNi’s Board of Directors approved the creation of a Series A Junior Participating Preferred Stock, adopted a
shareholders rights plan and declared a dividend of one right for each outstanding share of common stock held by our shareholders of record as
of the close of business on January 5, 2009. The rights attached to any additional shares of common stock issued after January 5, 2009. Initially,
these rights, which trade with the shares of HSNi’s common stock, will not be exercisable. Under the rights plan, these rights will be exercisable
if a person or group acquires or commences a tender or exchange offer for 15% or more of HSNi’s common stock. If the rights become
exercisable, each right will permit its holder, other than the “acquiring person,” to purchase from us shares of common stock at a 50% discount
to the then prevailing market price. As a result, the rights will cause substantial dilution to a person or group that becomes an “acquiring person”
on terms not approved by HSNi’s Board of Directors.
NOTE 18—QUARTERLY RESULTS (UNAUDITED)
72
Quarter Ended
March 31,
June 30,
September 30,
December 31,
(In thousands)
Year Ended December 31, 2010
Net sales
$
683,213
$
689,992
$
708,359
$
915,216
Gross profit
236,484
258,661
249,727
316,142
Operating income
37,495
48,350
32,797
77,444
Income from continuing operations
17,668
24,706
14,887
41,302
Loss from discontinued operations, net of tax
(15
)
—
(
9
)
(15
)
Net income
17,653
24,706
14,878
41,287
Income from continuing operations per share:
Basic
$
0.31
$
0.43
$
0.26
$
0.71
Diluted
$
0.30
$
0.42
$
0.25
$
0.69
Net income per share:
Basic
$
0.31
$
0.43
$
0.26
$
0.71
Diluted
$
0.30
$
0.42
$
0.25
$
0.69
Year Ended December 31, 2009
Net sales
$
629,620
$
640,083
$
641,244
$
838,662
Gross profit
211,224
231,871
237,068
301,151
Operating income
13,902
30,740
36,078
74,934
Income from continuing operations
2,982
13,638
16,585
39,373
Loss from discontinued operations, net of tax
(28
)
(28
)
(13
)
(21
)
Net income
2,954
13,610
16,572
39,352
Income from continuing operations per share:
Basic
$
0.05
$
0.24
$
0.29
$
0.70
Diluted
$
0.05
$
0.24
$
0.29
$
0.68
Net income per share:
Basic
$
0.05
$
0.24
$
0.29
$
0.70
Diluted
$
0.05
$
0.24
$
0.29
$
0.68