Martha Stewart agreed to have her annual pay cut by 10% to $1.8 million at the business she created, amid losses and a shift away from the company's roots in publishing and television.
Martha Stewart Living Omnimedia changed the compensation for its 71-year-old chairman as part of an option in a July 2012 agreement that extended her employment until 2017, according to a filing today. Her annual license fee was also trimmed by $300,000 to $1.7 million.
In the past year, the company has suffered from slumping advertising sales at its magazines and declining broadcasting revenue following the cancelation of "The Martha Stewart Show." Martha Stewart Living Omnimedia, which is trying to focus more on its merchandising business, is also seeking a permanent chief executive officer.
The company, which posted a net loss of $3.3 million in the first quarter after losing $56.1 million in 2012, said in the filing the changes in Ms. Stewart's contract are consistent with its plan to return to profitability.
CEO Lisa Gersh announced her exit in December. The company called her tenure a success, but her time there was marked by setbacks as well, including a lengthy lawsuit by Macy's The department-store chain, which has sold Martha Stewart-branded home goods since 2007, sued after rival J.C. Penney Co. took a stake in Martha Stewart Living and struck a deal to open "mini" Martha Stewart stores in its locations. Macy's argued that it has the exclusive right to sell items in categories including bedding and cookware.
Late last year Martha Stewart Living Omnimedia decided to close Whole Living magazine and cease publishing one-time high-flier Everyday Food as a standalone title, making it a supplement to Martha Stewart Living magazine instead.
~ Bloomberg News ~