Retailers, consumers and prices
Check out who’s making a bet on Borders, the struggling bookseller.
Financier Bennett LeBow, chairman of tobacco holding company Vector Group Ltd, is buying 11.1 million Borders shares through a company he controls — making him Borders’ single largest shareholder.
Borders CEO Mike Edwards praised LeBow’s turnaround prowess- fair enough. If you can help tabacco companies, you can probably help any ailing company.
Borders said it would use some of the money from LeBow to raise its profile in the fast-growing electronic books market. The No. 2 specialty bookstore chain expects to debut its e-bookstore, powered by Kobo in June. Kobo’s reader which will prominently feature Borders’ ebookstore, faces fierce competition from the likes of Amazon’s Kindle, Apple’s iPad and Sony’s Reader.
LeBow stepped in a few weeks after the bookseller repaid a $42.5 million loan to Bill Ackman’s Pershing Square Capital Management, which owns 10.6 million shares and had been Borders biggest investor prior to LeBow’s invesment.
from Dhanya Skariachan:
Check outa mixed bag of results from the consumer world.
Investors looking for yet another clue to gauge the strength of the U.S. consumer spending recovery might find some solace in online retailer Overstock's results and women's apparel retailer Ann Taylor's strong first-quarter outlook.
Overstock, which sells excess inventories of clothing, accessories, furniture and other items, recorded a 42 percent rise in quarterly sales, while Ann Taylor forecast a same-store sales rise of 11 percent in its latest first quarter.
For the modern professional woman who may have trouble putting together separate pieces of clothing in an interesting way, Ann Taylor LOFT is offering some help.
Its latest effort, called LOFT Style Studio, involves four stylists taking various items from the brand’s fall collection and putting them together in ways that may be unexpected (think faux fur vest on top of a tweed-like jacket or a striped cardigan over a floral dress). The ensembles will appear in LOFT stores, and various executives promise there will be ways for curious consumers to interact with the stylists and the brand via social networking.
Check out the better-than-expected results being served up by food companies.
Chocolate maker Hershey posted a quarterly profit above analysts’ expectations, said it was on target to meet its 2010 earnings forecast and boosted its dividend. The company also said it would boost advertising to try to sell more candy, including Almond Joy and York peppermint patties.
Meanwhile, Archer Daniels Midland, one of the largest processors of corn and soybeans, saw its profit slip 2 percent, but the results still topped analysts’ forecasts, and Pepsi Bottling also topped Wall Street’s view as productivity improvements offset a dip in sales. Fruit and vegetable producer Dole Food reported a higher fourth-quarter profit and paid down debt.
On Friday morning, AnnTaylor Stores reported lower-than-expected quarterly revenue and gave a cautious forecast for the current holiday quarter.
That staple in women’s fashion just turned 75!
Levi Strauss & Co created the first 701 denims for women in 1934 (the iconic 501 for men came long before) as ranchwear. But the company’s women’s jeans are now as much a favorite with the hip and chic as with the more casual wearer.
The company is celebrating the 75th anniversary of its women’s jeans by arranging store events in New York, Los Angeles, San Francisco, and Chicago — showing off women’s jeans and memorabilia from bygone eras as well as offering special discounts.
Check Out Ann Taylor’s huge quarterly loss.
The clothing retailer, which operates its namesake stores and Ann Taylor Loft stores, posted a loss that was almost twice as big as Wall Street analysts had expected. The company is also shuttering 46 more stores as working women curb their shopping urges amid rising unemployment and the unabating financial crisis.
Ann Taylor’s loss came a day after top U.S. retailers posted February same-store sales numbers. While the overall result was boosted by Wal-Mart, several apparel chains and department stores are still bleeding sales as consumers continue to spend their money on basics such as food.
The financial crisis has hit sales of everything from cars to homes to lattes. Now women scared about the market, and maybe even their own jobs, are wearing the old standbys in their closets rather than splurging on new clothes for work. At least, that’s what’s happening over at AnnTaylor, which expects a bleak fourth quarter.
Ann Taylor, the company’s stores stocked with business and business casual clothing, is feeling the “significant impact the financial crisis is having on the professional working woman,” Chief Executive Kay Krill said during a conference call on Friday.
“Corporate headcount reductions and rising fears of future unemployment have made our client cut down or even cut out her spending all together,” Krill said.
Ann Taylor stores are seeing a “dramatic pull back” in items like suits and workplace separates, which represent about a third of the items in its stores. Instead of buying a new suit, a shopper might just spruce up her wardrobe with a couple of tops.
“I think it’s a different day and definitely she’s not interested in suits. I think that women want their wardrobe to work harder for them. They want it to be able to go to work and on the weekend and that’s what we’re seeing happening.”
Over at the more casual Ann Taylor LOFT stores (seen here) sweaters, dresses, denim and other casual items were the top sellers last quarter, while shoppers shyed away from “refined separates,” such as shoes, bags and jewelry.
One bright spot? Cashmere, Krill said. Apparently, when the going gets tough, women wrap themselves in a little bit of softness to cushion the blow.
Check out things looking a little better in retail?
Ann Taylor raised its forecast for first-quarter earnings, citing improved results at its LOFT chain and stronger expense control.
This comes a few days after many retailers posted better-than-expected sales in April and could mark the start of a trend.
Goldman Sachs said the better April could lead to modest first-quarter earnings beats.
“This will be particularly evident across the department store sub sector as most management teams reduced their earnings outlook post March results, which fell short of plan. Kohl’s has already kick started this trend stating EPS would ‘exceed’ previous 40 cents to 42 cents guidance. We suspect J.C. Penney will follow suit, beating management’s 50-cent forecast … given high end of plan sales,” Goldman said in a research note.
Retail earnings get going in earnest this week with reports from Wal-Mart, Macy’s, J.C. Penney and others.
Also in the basket:
April retail sales barely budged: SpendingPulse
Luxury brands Prada, Ferragamo risk competing IPOs