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ValueVision Media, Inc. (VVTV)

F4Q07 Earnings Call

March 26, 2008 11:00 am ET


Amy Kahlow - Director of Communications

John D. Buck - Executive Chairman of the Board

Rene G. Aiu - President, Chief Executive Officer, Director

Frank P. Elsenbast - Chief Financial Officer, Senior Vice President


Jamie Lester

Bob Evans - Craig Hallum



Good morning and welcome to the ShopNBC fiscal fourth quarter and full year 2007 earnings teleconference. (Operator Instructions) I would now like to turn the call over to Ms. Amy Kahlow, Director of Communications. Madam, you may begin.

Amy Kahlow

Thank you. Good morning and welcome to today’s conference call. Today’s conference call may contain certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Listeners are cautioned that such forward-looking statements may involve risks and uncertainties that could significantly affect actual results from those expressed in any such forward-looking statements. More detailed information about these risks and uncertainties is contained in ShopNBC's filings with the SEC.

I would now like to turn the call over to Mr. John Buck, Executive Chairman of the Board.

John D. Buck

Good morning, everyone and thank you for joining us today on this call. Let me start by saying that this is an exciting time for all of us at ShopNBC and by that I mean the appointment of Rene Aiu as ShopNBC's new CEO, our new leader, and also a member of the board of directors.

Rene brings an extensive background and broad expertise in TV shopping to the network. Twenty-two years of experience in both U.S. and international markets, including Japan, Italy, the U.K., and she possesses an industry vision and a working style that without a doubt will contribute greatly to the company in ’08 and beyond.

Before I give a more thorough introduction of Rene and how she came to join the network, I’d like to give you a preview of today’s calls, which is also joined by Frank Elsenbast, our CFO.

Today’s prepared remarks will touch on three areas; one, a brief financial review of our fourth quarter and full year results; two, a quick report card on our fourth quarter performance against what we said we would do on our last call; and three, some comments on our fiscal 2008 outlook.

As you may know, the search for our new CEO began four months ago and was conducted by the firm Spencer Stewart. It would be an extensive process, a global search, in fact, with the board mandating that they find a candidate who not only had a proven track record of success in direct marketing to consumers, but also someone who really understood the business of TV shopping and e-commerce.

TV shopping is a fascinating, fascinating and unique business. There’s magic to it. You need the right product, the right hour, the right host, and the right value proposition. Spencer Stewart did a wonderful job in finding Rene.

There’s much that can be said about Rene and over time, you will come to know her and enjoy her as I do. She is a great selection to be our new leader. Her proven track record of success, having served as CEO of Jupiter shop channel Japan and previously senior vice president HSN, makes her the ideal leader for the next phase of growth and expansion at ShopNBC.

At Jupiter, Rene was successful in establishing the company as the number one shopping network in the marketplace, growing net sales five-fold during her tenure. Profitability and more importantly sustained profitability was also achieved early on under Rene’s leadership.

Moreover, Rene directed a well-integrated and successful e-commerce arm of the business, exceeding annual sales goals year after year. In fact, she developed the initial business plan and led the start-up of what would be the first live television shopping channel in Japan.

When Rene was with HSN as senior vice president, she directed the company’s marketing, on-air sales, programming, and production departments, with company sales of approximately $1.3 billion. She has been a consultant as well to Liberty Global and HSN International on some major TV shopping related initiatives in European countries.

You can see Rene has worked directly in almost all areas of the home shopping industry throughout her 22-year career. She is what we would call a subject matter expert on TV shopping who is passionate and disciplined in her execution -- relentless, some might say. She is customer focused like a laser beam and product being the start of the show. And considering 70% of our loyal customers are female, who better to understand our customer and their needs than Rene, complemented by her wonderful background and experience?

So Rene, we are so pleased to have you here.

Rene G. Aiu

Well, thank you, John, for those kind remarks. It’s truly an exciting time for me as well. I must apologize that, as you can see, I’m still in the process of acclimating here in Minneapolis and if I start to lose my voice, I may turn it back to John. But I really thought it was important that at least I participate in this first call.

As John has said, I have been in the home shopping arena for over 22 years. I have worked in multiple countries at multiple companies. Through all my experience, one thing has held constant in order to achieve success in TV shopping -- an absolutely disciplined focus on the fundamentals.

To be successful in this business, you have to have an absolutely disciplined focus on these fundamentals and this means: one, a relentless focus on the customer, as she is the focus of the company and the product is our store; two, this means a passionate pursuit to increase real-time sales productivity across all channels, whether they be TV, Internet, direct mail, or mobile; three, this means disciplined on-air sales execution; four, products that encourage repeat customer activity; five, strategies that grow the core customer base and increase home penetration; six, customer service that exceeds expectations; seven, an empowered group of employees through a performance-oriented culture.

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