Damark International Inc., Minneapolis, had 1998 net revenue of $484.4 million, down 18.5% from $594.6 million in 1997. Much of the drop came from its catalog business: While its membership business produced net revenue of $89.4 million in 1998, a 38.9% increase from the $64.4 million reported in 1997, its catalog net revenues were down 25.5% to $395 million from $530.3 million.
For the year, Damark recorded a net loss of $19.6 million compared to net income of $6.3 million in 1997.
Damark’s 1998 fourth-quarter membership revenue increased to $29 million, up 61.5% from the $18 million reported for the same period in 1997. Fourth-quarter total net revenue declined 23.9% to $139.7 million from the $183.7 million reported last year. For the quarter, the company’s net losses totaled $9.5 million in 1998’s last quarter compared to net income of $3 million for fourth quarter 1997. New members acquired during the period totaled 796,000, up 127% from 1997. Catalog net revenue was down 33.2% to $110.7 million from $165.7 million in 1997.
At year-end, Damark reported 1.73 million memberships, 25.3% of which were originated through the client services channel, a market segment that the company has pursued aggressively since third quarter 1997. Damark plans to continue to invest in client services membership throughout 1999 and anticipates recovery of these investments through future membership renewals.
Damark, a marketing solutions provider, delivers products and services via direct mail, telesales and the Internet.
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