Liberty Interactive Class A Earnings Call Nuggets: Trip Position and Leap Year Benefit

Liberty Interactive Corp Class A (NASDAQ:LINTA) recently reported its first quarter earnings and discussed the following topics in its earnings conference call.

Trip Position

Jason Bazinet – Citi: I just had a question on Liberty Ventures. I think it was last year that you ended up selling 8.5 million or so of the Trip shares and then turn back around and bought the super votes of Trip which led to the consolidation this quarter. On Expedia, I think you sold 12 million shares at 34, and I’m just – it just sort of feels like there’s a second chapter to that story and I didn’t know if you could share sort of – what was behind the original Expedia sale and what if anything can we look forward to either this year or next?

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Gregory B. Maffei – President and CEO: Well, as I think you righty noted, we’ve changed our position on Trip largely because we had an opportunity to move into high control and consolidation that was appealing. We had previously sold the high basis shares and we didn’t see a path. When the path changed, our process changed. At Expedia, I think we saw a little bit of the same. It was in hindsight an ill-timed sale, but that was high basis shares that we sold for liquidity and because we didn’t see a path there. There is clearly some other chapter to be written to Expedia. We can’t say what that’s going to be yet, don’t know what that’s going to be yet, but that is the opportunity for Ventures.

Jason Bazinet – Citi: Are there key high level options you could outline in terms of paths?

Gregory B. Maffei – President and CEO: Well, maybe there is potential to do some kind of 355 transaction there. We’ve done 355s in other holdings we’ve had. Maybe if there is a potential to arrange a purchase of the shares, the control shares back and return the proxy back as we did at Trip, maybe there is a potential to do an tax efficient exchangeable into the base of the other remainder of our shares, those are three option that Liberty would be liberty at any one of the three.

Leap Year Benefit

Benjamin Mogil – Stifel Nicolaus: I know you talked about the 100 basis point benefit from the leap year benefit. Could you give us a sense of what the benefit was or so the better benefit, if you will, from the Easter holiday coming in 1Q versus 2Q last year?

Gregory B. Maffei – President and CEO: Generally speaking, unlike traditional retail, we don’t really have a really meaningful impact from Easter. So typically timing of Easter is not a real material driver of our performance in the quarter.

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Benjamin Mogil – Stifel Nicolaus: Okay. And then looking at Japan specifically, obviously the currency has been highly volatile there off late. Even leaving aside the same currency or constant currency situation, when you just look at the currency as it impacts your business in constant currency, can you talk about that? I mean should we be seeing COGS be going up in that market just by virtue of the fact that you are buying, I am guessing, from China vis-a-vis the U.S. dollars, if you will.

Christopher W. Shean – SVP and CFO: So far we haven’t seen any impact and we don’t anticipate it, largely given the structure of our business, although I don’t know that we can totally rule it out. Keep in mind that unlike our other markets, most of our inventory is on consignment. And so the way we work in Japan is we work with a number of Japanese agents and vendors who are procuring that inventory on our behalf. And so all of our financial transactions with those Japanese vendors are in yen, so in that sense we’re neutral. Maybe if there’s some cost pressure at the source, that will eventually impact us, but so far we’re really not seeing any significant (in-country) impact from the devaluation of the yen.

Benjamin Mogil – Stifel Nicolaus: And just last question. On the MSO agreements domestically, are you seeing no real change in pricing, etc. Is it sort of steady as she goes?

Mike George – President and CEO of QVC, Inc.: Yes, it’s very steady.