With a smirk of dismay, Ms. Stewart said she knew what everyone gathered at the Mid-Year Media Review was "interested" in, and she spoke briefly about "an enormous amount of misinformation and confusion" in the press regarding the investigation. Ms. Stewart has denied any wrongdoing.
Cooperating with investigators
"In my June 12 statement, I explain what happened, at least as it pertains to me," Ms. Stewart said, adding that she "cooperated fully" with federal investigations earlier this year and, "contrary to what you've read," she was cooperating with congressional investigators as well, a development reported today in The New York Times.
Ms. Stewart, a friend
Shares of Martha Stewart Living Omnimedia have taken a hit from the ImClone coverage. At the end of May, shares were trading $19.40; the stock closed Tuesday at $14.40.
An image of correctness
The company's inextricable association with Ms. Stewart -- as well as her image of correctness and rectitude bred through countless craft directions, recipes and even etiquette tips -- "has been a concern since the company went public," said Doug Arthur, an analyst with Morgan Stanley & Co. "Martha's critical" to the brand, he conceded, but that "this is a very deep company," refering to its managerial talent.
Asked about the long-term implications of the ImClone investigation, Mr. Arthur shrugged and said, "Your guess is as good as mine. From my vantage point, the business is very strong and the stock is very cheap."
James Follo, the company's executive vice president and chief financial officer, said projected second-quarter results have revenues up 15% and earnings before interest, taxes, depreciation and amortization, or EBITDA, up 40%, and he nudged earnings-per-share expectations up one cent, to 15 cents.
"My feeling is over time, as Martha mentioned, this will all be put to bed," Mr. Follo said to questions posed by reporters about stock price concerns.
No change with Kmart
Mr. Follo said there was "no change" in the company's status with beleaguered retailer K-Mart, which sells a large line of Martha Stewart-branded items, and he declined to comment on questions concerning the prospect of the company partnering with Sears, Roebuck & Co. Mr. Follo said during the presentation that merchandising sales this year looked likely to be flat compared with 2001.
Ms. Stewart hinted at one possible new product for the company, an "everyday after-school" children's-themed TV show, though, she added, "we haven't gone to sell it yet."