Homepage

News > Midsized Companies
    SAVE   |   EMAIL   |   PRINT   |   RSS  
Martha exec is out
Top executive at Martha Stewart Living Omnimedia resigns as Stewart's prison term nears end.
March 1, 2005: 6:17 PM EST
Martha Stewart:
Battle of the Sexes

Do men and women think differently about Martha Stewart?
Take our quiz:
Men:
Click here

What men said
Women:
Click here

What women said

NEW YORK (CNN/Money) - Martha Stewart Living Omnimedia said Tuesday that a veteran executive in charge of the company's magazine publishing business is leaving, just days before founder and namesake Martha Stewart is due to be released from prison.

Suzanne Sobel, publisher and executive vice president of Martha Stewart Living Omnimedia (down $1.65 to $33.70, Research) , resigned, the company said in a statement.

Sobel's exit is the latest in a string of management changes at the struggling company. Late last year CEO Sharon Patrick left and was replaced by former ABC executive Susan Lyne. The company also brought in a new chairman last year and has rejigged its board of directors.

The moves have been brought on by the Stewart's personal legal troubles.

Stewart is due to be released Friday from a minimum-security federal prison in West Virginia, having served a five-month sentence following her conviction a year ago on charges she lied to investigators about her late 2001 sale of ImClone stock right before the share price plunged.

Stewart, 63, will spend the next five months in home confinement at her Bedford, N.Y. estate. Her appeal is pending.

The legal case has hit her company's finances hard. Last week the company announced its second consecutive annual loss.

The publishing business, which includes the flagship Martha Stewart Living monthly magazine and the nascent Everyday Food, is the New York lifestyle company's largest business, accounting for about half of its $187 million in sales last year.

The company's other key businesses include home furnishing products sold primarily through Kmart (Research) and a television unit.

The company's publishing division, however, has faced some difficult years as advertisers have fled Martha Stewart Living in the wake of Stewart's legal troubles.

Since 2002, advertising revenue at the monthly magazine has plunged nearly 70 percent, with ad pages off by 65 percent, according to the Publishers Information Bureau.

In response, the company last year lowered Martha Stewart Living's rate base, the minimum circulation guaranteed to advertisers, from 2.3 million to 1.8 million.

Meanwhile, Everyday Food, a monthly magazine launched in 2003, has been growing. The company just announced a rate base increase from 500,000 to 800,000, a move that bodes well for the publication.

In its statement Tuesday, Martha Stewart Living Omnimedia said it will begin an immediate search for Sobel's replacement. Sobel herself said she was leaving "to seek out new challenges."

Sobel has worked for Martha Stewart Living since at least 1991. She has served as publisher of Martha Stewart Living since 1997 and earned $745,000 in cash compensation in 2003, according to the company's most recent compensation filing with regulators.  Top of page

graphic


YOUR E-MAIL ALERTS
Martha Stewart Living Omnimedia Incorporated
Martha Stewart
Suzanne Sobel
Manage alerts | What is this?