04-23-2009, 08:57 AM
CREDITOR’S EDGE
(The Nation’s Oldest Daily Business E-Newspaper)
—The Day’s News in Capsule Form—
A Product of Bastien Financial Publications
(For more information contact us at 847-491-1900
or email <!-- e --><a href="mailto:usbj7@yahoo.com">usbj7@yahoo.com</a><!-- e -->)
Monday
April 20, 2009
(This daily e-newspaper is a copyrighted publication for the exclusive use
of the recipient only and is not to be forwarded or copied
in whole or in part for use by any other party.)
Educational Tidbits
For Today's Financial Executive
How Does You Credit Reporting Agency Rate?
The best credit reporting agency is one that provides you with the most comprehensive and updated business information, in both a timely manner and at a fair price. Do the major credit reporting agencies do this for you? Some say yes, some say no.
We would like your opinion if they do or do not live up to your expectations. On a scale of 1-10, with 10 being the best, rate the agency you purchase business credit reports from and tell us why you rate them the way you do. Email your opinions to <!-- e --><a href="mailto:usbj7@yahoo.com">usbj7@yahoo.com</a><!-- e -->.
The Business Professional’s
Q&A Corner
YESTERDAY’S QUESTION: Explain why a creditor should be aware of changes in ownership and what a creditor should do when this information is made available.
ANSWER: Creditors should be aware of a change in ownership for a number of reasons. The most obvious is the credibility and management capabilities of the new owner/management. Has their track record been successful? Are they experienced in the industry? What relationship, if any, do they have with their lenders? Is their character one you want to sell to? And look even closer when ownership changes hands in a closely-held family company–especially if that change in ownership is from a parent to a son or daughter. Will that offspring value the company in the same way their parents did?
QUESTION: Explain what a composition of creditors is.
ANSWER NEXT ISSUE
Today's Headlines:
AbitibiBowater Inc. files for bankruptcy protection...
Best Buy Co. Inc. sees one analyst anticipate 1,000 job cuts...
Briggs & Stratton Corp. reports its third quarter net income and net sales decline...
Callaway Golf Co. reports its first quarter net sales and gross profit decline...
Duckwall-Alco Stores Inc. reports a fourth quarter net loss on a revenue increase...
Gannett Co. reports its first quarter net and revenue decline...
Genuine Parts Co. reports its first quarter net and sales decline...
Harley-Davidson Inc. expects to reduce its workforce by up to 400 workers...
PPG Industries Inc. reports a first quarter net loss on a sales decline...
Upper Valley Medical Center to eliminate nearly eighty positions from its payroll...
Virco Manufacturing Corp. reports a net loss on a sales decline...
BANKRUPTCY NEWS
(For more information on these (or any) bankrupt firms
call the 800-number in your U.S. Bankruptcy Court Directory
available through Bastien Financial Publications.)
AbitibiBowater Inc., the giant Canadian newsprint firm which was formed two years ago with the merger of U.S.-based Bowater Inc. and Abitibi-Consolidated of Canada, has filed for bankruptcy protection under Canada’s Companies’ Creditors Arrangement Act and in the U.S. Bankruptcy Court in Delaware. The company filed along with more than thirty of its affiliates as it attempts to restructure its overall operations. The company’s subsidiaries outside Canada and the United States have not field. The Montreal company listed assets and liabilities in its Delaware filing of $9.9 billion and $8.8 billion respectively.
In a separate motion, the company has requested the U.S. Bankruptcy Court to approve both post-petition financing and authorization to use certain cash collateral.
For more information contact the U.S. Bankruptcy Court in Delaware at 302-252-2560.
All American Semiconductor Inc. has seen the U.S. Bankruptcy Court in Miami confirm the third amended plan of liquidation which was submitted by the unsecured creditors’ committee. For more information contact the court at 305-536-5979.
Autobacs Strauss Inc. has seen the U.S. Bankruptcy Court in Delaware set 5/22 as the final date for filing proof of general claims in the case. The government proof of claim deadline was set at 8/3. The case number is 09-10358. For more information contact the court at 302-252-2560.
Bettina Corp. dba Blue Dog Inc. of Dallas, Tx. has filed for Chapter 11 protection in the U.S. Bankruptcy Court for the Northern District of Texas. The maker of electronic bingo equipment listed assets and liabilities of $1.4 million and $4.4 million respectively.
For more information contact the court at 800-886-9008.
Foothills Texas Inc., has seen the U.S. Bankruptcy Court set the final date for filing proof of claims as 5/11. The case number is 09-10452. For more information contact the U.S. Bankruptcy Court in Delaware at 302-252-2560.
General Growth Properties, the Chicago, Il. mall operator which recently filed for Chapter 11 protection, is seeking U.S. Bankruptcy Court approval to hire certain attorneys and agents at as much as $965 an hour.
JPA Furniture Inc. filed Chapter 11 in the U.S. Bankruptcy Court in Arizona. The firm listed assets and liabilities of between $100,000 and $1 million each. A meeting of creditors is scheduled for 5/19. The case number is 09-07585. For more information contact the court at 888-549-5336.
M&D 1 LLC has filed Chapter 11 in the U.S. Bankruptcy Court for the Eastern District of Virginia. The firm listed assets and liabilities of between $1 million and $100 million each. The case number is 09-12936. For more information contact the court at 800-326-5879.
Oil and Gas Equipment Leasing LLC filed Chapter 11 in the U.S. Bankruptcy Court in Colorado. The company, headquartered in Lone Tree, Co., listed liabilities of $5.5 million. For more information contact the court at 720-904-7419.
Petrozone Inc. has seen an involuntary Chapter 11 petition filed against it in the U.S. Bankruptcy Court for the Northern District of Indiana. No schedules were listed. The case number is 09-21449. For more information contact the court at 800-755-8393.
Polaroid, the bankrupt camera company, has seen Hilco Trading LLC, a Northbrook, Il. firm, become part of an investment group that obtained U.S. Bankruptcy Court approval to purchase most of the assets of the 70-year-old firm.
Renew Energy LLC, which operates Wisconsin’s largest ethanol production operation, is selling its facility. The bankrupt firm reported that if it cannot find a buyer it will simply close the facility.
Roosevelt Lofts LLC has filed Chapter 11 in the U.S. Bankruptcy Court for the Central District of California. The firm listed assets of less than $500 million. The company’s largest unsecured creditors are Muir-Chase Plumbing Co. and Kultur Flooring USA Inc. For more information contact the court at 213-894-4111.
Rouse Co. at Owings Mills LLC and several of its affiliated firms filed Chapter 11 in the U.S. Bankruptcy Court for the Southern District of New York. The case numbers range from 09-12236 to 09-12249. Assets and liabilities were estimated at more than $1 billion each. For more information contact the court at 212-668-2772.
Santee Village Partners LLC has filed for Chapter 11 bankruptcy protection in the U.S. Bankruptcy Court for the Central District of California. The company, a real estate firm, listed assets of less than $50 million. For more information contact the court at 213-894-4111.
Schiappa Foods Corp., a Florida operator of fifteen Arby’s restaurants, has filed
Chapter 11 in the U.S. Bankruptcy Court for the Southern District of Florida. The company is based in Palm Beach Gardens, Fl. For more information contact the court at 305-536-5979.
Smart Office Systems Ltd. filed Chapter 11 in the U.S. Bankruptcy Court for the Western District of Michigan. The firm listed assets of between $100,000 and $1 million and liabilities of between $1 million and $100 million. The case number is 09-04503. A motion was made to sell nearly all of the debtor’s assets. For more information contact the court at 616-456-2075.
Sun-Times Media Group Inc. has seen a 4/29 meeting of creditors scheduled at the U.S. Bankruptcy Court in Wilmington, De. For more information contact the counsel for the debtor in Wilmington, Jamie Luton, at 302-571-6600.
Tusca Mediterranean Tapas has filed Chapter 11 in the U.S. Bankruptcy Court in Pittsburgh listing assets of less than $500,000 and liabilities of between $1 million and $10 million.
DISTRESSED / RAPIDLY-EXPANDING COMPANIES
&
OTHER COMPANY NEWS
American International Group Inc., the beleaguered New York insurance firm which is trying to sell a number of its units in order to repay $182 billion to the Feds, is selling its 21st Century car insurance operations to Farmers Insurance in a transaction valued at $1.9 billion.
Allstate Insurance Co., the giant auto insurance firm, is expanding in the state of Georgia as it attempts to increase its market share. The company anticipates having an unspecified number of offices throughout Georgia as it seeks to hire laid-off professionals who received severance packages. Allstate is looking to hire agents that can spend the $50,000 needed to open an agency in that state.
Associated Banc-Corp, the Green Bay , Wi. firm which reported its first quarter net declined 47%–to $35 million and which reported its provision for loan losses jumped to $105 million from $65 million in the fourth quarter, reported its would cut its dividend payouts. At the end of the first quarter, the company reported non-performing loans reached more than $450 million. This compares with $340 million as of 12/31.
AXS-One Inc., the Rutherford, N.J. $13 million software firm, has been purchased by Unify Corp., a Roseville, Ca. software maker, in a transaction valued at $8 million. The transaction is expected to be finalized by 7/31.
Beck Imports of the Carolinas, an operation of Sonic Automotive Inc. which owns 160 automotive dealerships nationwide, has been purchased by Hendrick Automotive Group for an undisclosed amount.
Best Buy Co. Inc., the giant Richfield, Mn. electronics retailer which is attempting to reduce costs, has seen one analyst anticipate the company may reduce its workforce by 1,000 employees. Best Buy recently announced a demotion among its senior sales associates that would cut salaries by nearly 50%. The demotions are expected to affect nearly 8,000 employees.
Bioheart Co., the Sunrise, Fl. biotechnology firm which had only $50,000 in cash and cash equivalents as of 12/31, reported a fourth quarter net loss of $2.6 million. This compares with a loss of nearly $9 million for the same period in 2007. For the year, the company lost just over $14 million, an improvement from the $18 million it reported losing in fiscal 2007. The company’s auditors included a “going concern†letter along with the financial report..
Briggs & Stratton Corp., the Wauwatosa, Wi. small engine manufacturer, reported its third quarter net income declined 35%–to $25.3 million, on a 7% decline in net sales–to $674 million. The decline was partly a result of falling sales in its engines segment. The firm projected net income, for fiscal 2009, of as much as $32 million.
Callaway Golf Co., Carlsbad, Ca., reported net sales for its first quarter declined 26%–to $272 million while its gross profit declined 10%–to $116 million or 43% of net sales. A company spokesman reported that he believes the firm will outpace the industry, where industry-wide sales are expected to decline by as much as 20% this year.
Cedar Fair Entertainment Co., the Sandusky, Oh. amusement park operator which owns and operates the Knott’s Berry Farm park in California and which operates ten additional amusement parks, has hired Merrill Lynch & Co. to help it explore strategic alternatives that could include selling certain assets. In order to reduce its debtload, which, in part, was a result of its $1.2 billion purchase of Paramount Parks more than two years ago, the company is attempting to sell four of its amusement parks. Cedar Fair reported a fourth quarter net loss of nearly $57 million.
Charlotte Russe Holding Inc., a San Diego, Ca. mall-based specialty store retailer which operates nearly 500 outlets throughout the U.S., reported a second quarter net loss of $820,000. This compares with earnings of $4.2 million for the same period one year earlier. Net sales increased 3%–to $191 million.
Citigroup Inc., the financially-challenged New York banking firm, reported first quarter earnings of $1.6 billion, a turnaround from a $5 billion loss one year earlier and a $17.5 billion loss in the fourth quarter. The company now has $32 billion in capital reserves to provide for loan losses.
Cypress Semiconductor Corp. of San Jose, Ca. reported a first quarter loss of $91 million. This compares to a loss of $24 million for the same period one year earlier. Revenue declined 17%–to $139 million. Revenue beat analysts’ expectations.
Cytec Industries Inc., the Woodland Park, N.J. firm which experienced declining sales across all of its chemical products lines, reported a first quarter net loss of $100,000. This compares with income of $49 million for the same period one year earlier. Sales declined to $612 million during the first quarter from $973 million for the same period in 2008. At its Cytec Surface Specialties operations, sales declined 46%–to $243 million, while reporting an operating loss of nearly $21 million. At Cytec’s Engineered Materials operations, sales declined 15%–to $170 million while reporting operating earnings of $33 million. At Cytec Performance Chemicals, sales declined 28%–to $132 million while operating earnings declined more than 50%–to $5.8 million.
DVL Inc., the New York-based commercial finance and real estate firm, reported fiscal income from continuing operations declined to $1.8 million. This compares with $2.5 million for fiscal 2007. Revenue declined slightly–to $10.3 million.
Deltek Inc., the Herndon, Va. provider of enterprise applications software, expects its first quarter revenue to be below guidance estimates of $68 million. The company anticipates revenue of nearly $62 million. Citing the BearingPoint bankruptcy, Deltek expects its earnings per share to be no more than 6 cents as opposed to prior guidance of as much as 7 cents per diluted share. The company, which managed to reduce its debtload by more than $10 million during the first quarter, expects operating cash flow for the period of nearly $17 million.
Duckwall-Alco Stores Inc., the Abilene, Ks. retailer, reported a fourth quarter net loss of $715,000. This compares with income of $1 million for the same period one year earlier. Revenue increased 2%–to $138.5 million while gross margins for its fourth quarter declined from 30.3% to 29.7%. For the year, the company reported a widened loss of $5 million, up from a $224,000 loss for fiscal 2008. Revenue for fiscal 2009 increased 4%–to $478 million. Same-store sales for the company’s fourth quarter declined 3.3%, an improvement over the 6.3% decline during its third quarter.
Fidelity Southern Corp., the Atlanta, Ga. banking an insurance firm, reported a first quarter net loss of $3.4 million. This compares with earnings of $1.1 million for the same period one year earlier. During the quarter the company’s mortgage operations originated $85 million in new loans. This compares with only $6 million in new loans during the first quarter of last year.
First Horizon National Corp., the parent of First Tennessee Bank which received $860 million at the end of last year from the Fed’s TARP program, reported a first quarter net loss of $65 million on an 11% revenue decline–to $605 million. The loss compare with income of $12 million for the same period one year earlier.
Fred Hutchinson Cancer Research Center in Seattle, Wa. reported that as a result of declines in both investment income and philanthropic giving, the firm is laying off more than eighty employees in order to reduce costs.
Gannett Co., the giant McLean, Va. newspaper and broadcasting firm which saw advertising revenue for its publications decline by more than a third in its most recent quarter, reported its first quarter net declined 60%–to $77 million. Overall revenue declined 18%–to $1.4 billion. While broadcasting revenue declined 15%–to $143 million, on the bright side, the company’s digital revenue jumped tenfold–to more than $140 million.
General Electric Co., which has been adversely affected by the weak economy at its financial operations, reported its overall first quarter net declined 35%–to $2.9 billion. Revenue at the Fairfield, Ct. conglomerate declined 9%–to $38 billion. While revenue at the company’s industrial operations were flat, earnings at its finance unit declined 58% on a year-over-year basis.
General Environmental Management Inc., the Pomona, Ca. firm whose earnings didn’t meet those required in certain of its loan covenants, is seeking a waiver from its lender, CVC California LLC. The company lost $7 million last year, an improvement over the $16 million loss reported in fiscal 2007. Revenue increased 14%–to $35 million. Its deficit of nearly $12 million was cited as one reason for doubt in the firm’s ability to continue effectively operating.
Genuine Parts Co., the Atlanta, Ga. maker of industrial and automotive parts, reported its first quarter net declined 27%–to $89 million, on an 11% sales decline–to $2.4 billion. The company anticipates overall sales to improve throughout the year.
Google Inc., the giant Mountainview, Ca. internet firm, reported first quarter net of $1.4 billion, an improvement from the $1.3 billion reported for the same period one year earlier. Revenue increased 6%–to $5.5 billion. Analysts had expected net earnings of just under $1.6 billion for the company which reduced its workforce by 340 positions in its most recent quarter. It should be noted that the company recorded a $275 million charge for stock compensation during the period. Only last month, Google completed an offer to exchange certain employee stock options issued under the company’s 2004 stock plan. The company anticipates SBC charges for grants to employees prior to 4/1 to be just over $1 billion this year. As of 3/31, the company had cash and cash equivalents of nearly $18 billion.
Harley-Davidson Inc., the Milwaukee, Wi. motorcycle maker which reported its first quarter net declined 36%–to $117 million, now expects to reduce its workforce by as many as 400 additional workers. This is in addition to the 1,100 job cuts announced earlier in the year. Net sales for its most recent quarter declined slightly–to $1.3 billion.
Hawker Beechcraft Acquisition Co. LLC of Wichita, Ks. reported a first quarter operating loss of $41 million. This compares with an operating loss of $1.5 million for the same period one year earlier. Net sales for the first quarter declined to $538 million, down from $576 million for the same period in 2008. Over the past six months Hawker has announced reductions in its workforce of more than 2,700 jobs.
Insteel Industries Inc., the Mount Airy, N.C. maker of steel wire reinforcing products, reported a loss of $16.3 million for its first quarter. This compares with earnings of nearly $7 million for the same period one year earlier.
Kmart Corp., in a filing with the state of North Carolina, reported it would lay off more than seventy workers at one of its Wake County retail outlets. Kmart is a subsidiary of Sears Holding Corp. of Hoffman Estates, Il.
Krispy Kreme Doughnuts Inc., the Winston-Salem, N.C. firm which reported, in its most recent quarter, a narrowed loss and which recently reported reaching certain credit agreements with its lenders that would provide it with sufficient liquidity, saw its stock price rise more than 50%.
Landstar System Inc., a Jacksonville, Fl. trucking company, reported its first quarter earnings declined 40%–to just under $14 million. Revenue declined 23%–to $469 million. Purchasing $12 million of its own shares during the first quarter, the company, nevertheless, was reluctant to provide second quarter earnings guidance.
Media General Inc., the Richmond, Va. operator of newspapers and television stations, reported a first quarter net loss of $21 million, up slightly from a loss of $20 million during the first quarter of last year. Revenue declined to $159 million from $195 million for the same period one year earlier. While traditional ad revenue declined 25% during the quarter, online advertising increased 30% and digital revenue jumped 25%.
Meridian Bioscience Inc., the Newton, Oh. biomedical firm which was adversely affected by the mild flu season, reported flat earnings for its second quarter of $7.3 million. Net sales declined 8%–to $33 million. Earnings and sales were below analysts’ expectations.
Nationwide Mutual Insurance Co., Columbus, Oh., which earlier in the month announced it was reducing its workforce by 480 workers in order to save more than $16 million this year, has advised its more than 34,000 worker that it would cut back on a number of perks including the carry-over of vacation days and its associate referral program. The company lost $340 million last year.
Organic to Go, the rapidly-expanding Seattle, Wa. restaurant chain with more than 125 outlets nationwide, continues to expand in the Washington, D.C. area. The company, which was the first such restaurant to be certified as organic, is opening up its fifth D.C. outlet at the end of this month.
Orlando Opera Co. in Orlando, Fl., affected by the weak economy and declining ticket sales, will suspend its operations as of the end of this month.
PharmEcology Associates LLC, a Wauwatosa, Wi. firm which provides waste management consulting services to the pharmaceutical industry, has been purchased by WM Healthcare Solutions Inc., a unit of Waste Management Inc. of Houston, Tx., for an undisclosed amount.
Plexus Corp., the Neenah, Wi. electronics contract manufacturer, anticipates its second quarter will include charges of nearly $8 million as a result of goodwill impairment and its restructuring efforts. Earnings for the period are expected to be no more than 24 cents a share while revenue could reach just over $400 million.
Polaris Industries Inc., a Medina, Mn. maker of all terrain vehicles, saw its stock price increase 14% on news that its first quarter earnings, despite declining 55%, came in better than analysts expected.
PPG Industries Inc., the Pittsburgh, Pa. paint manufacturer, reported a first quarter net loss of $111 million. This compares with earnings of $100 million for the same period one year earlier. Sales declined 30%–to $2.8 billion. The loss included restructuring and after-tax charges of more than $140 million.
PPG Industries Fiberglass Products Inc., the unit of Pennsylvania-based PPG Industries, announced plans to reduce its workforce by ninety employees as of 5/1, citing a reduction in demand for its fiberglass products.
Renaissance Learning Inc., the Wisconsin Rapids firm which is the world’s leading provider of computer-based assessment technology for preschool through the 12th grade and whose learning tools have been adopted by more than 74,000 schools, reported first quarter net of $3.9 million, an increase from $2.6 million for the same period one year earlier. Revenue declined just under 2%–to $29 million.
Shaheen’s Department Store, the family-owned Louisville, Ky. apparel retailer, is expanding its operations in the Kentucky area with a new store expected to open by 4/30.
Sony Ericsson, the Swedish mobile phone maker, announced it would cut an additional 2,000 jobs from its workforce, citing a decline in global demand for its products. The company recently reported a first quarter loss of $386 million.
Sun Microsystems, the giant Santa Clara, Ca. firm which only weeks ago had been sought after by IBM of Armonk, N.Y. only to see Sun reject the $7 billion offer, has seen the New York firm react unresponsively to Sun’s recent efforts to restart purchase talks.
Sunoco Inc. of Philadelphia, Pa. is selling a Tulsa, Ok. refinery to Holly Refining & Marketing-Mid-Con LLC, a subsidiary of Holly Corp., a Dallas, Tx. petroleum refiner, in a transaction valued at $65 million.
Tempur-Pedic International Inc., whose world headquarters is in Lexington, Ky., reported first quarter net income of $13.3 million, down slightly from year-earlier quarter net of $13.5 million. Net sales declined 28%–to $177 million. The company, which is one of the world’s largest makers and distributors of mattresses and pillows, maintains its 2009 financial guidance for its earnings per share at no more than 90 cents per diluted share. The company, however, reduced its net sales guidance to no more than $740 million.
The Saint Louis Science Center, as part of its efforts to reduce costs, has offered early retirement packages to more than two dozen of its workers in St. Louis. The acceptance deadline was set at 5/4.
The News & Record, the Greensboro, N.C. newspaper which, like so many in the newspaper industry has been adversely affected by both the weak economy and reduced advertising revenue, is reducing its workforce by twenty-five jobs while also making changes to its newspaper in order to reduce overall expenses.
Toshiba Corp., the giant Japanese electronics conglomerate which is attempting to reduce its capital spending by 40%, intends on reducing its workforce by 3,900 temporary jobs in Japan. This comes on top of the 4,500 temporary workers the firm has already laid off.
Tyco Electronics Wireless Systems, the Lowell, Ma. unit of Tyco Electronics Ltd., is being purchased by Harris Corp., a Melbourne, Fl. communications and information technology firm, in a transaction valued at $670 million.
Umpqua Holdings Corp., the Portland, Or. parent company of both Strand, Atkinson, Williams & York Inc. as well as Umpqua Bank, reported a first quarter net loss of $10.6 million while operating revenue declined 17%–to $133 million. The loss, in part, was a result of loan losses from residential developments.
Unisys Corp., the Blue Bell, Pa. information technology firm, has landed a $92 million contract with the General Services Administration to provide help desk services for more than 14,000 computer systems.
Upper Valley Medical Center, the Troy, Oh. facility which is trying to save $5 million, is eliminating nearly eighty positions from its payroll. The company also intends on eliminating wage increases for its management staff this year.
Virco Manufacturing Corp., the Torrence, Ca. firm which recently extended its $65 million credit facility with Wells Fargo Bank for the next two years, reported a net loss of $3.2 million for its most recent quarter ended 1/31. This compares with a loss of $3.1 million for the same period one year earlier. Sales declined 15%–to $27.7 million. Gross margins, on a year-over-year basis declined from $10.4 million for the quarter ended 1/31/08 to $8.6 million in its most recent quarter. The company ended its fiscal year with no bank debt.
Werner Enterprises Inc., the Omaha. Ne. firm which is one of the nation’s largest truckload transportation and logistics firms, reported its first quarter revenue declined 23%–to $395 million. Earnings declined more than 16% during the period.
West Marine Inc., the Watsonville, Ca. boating supply firm, reported its first quarter revenue declined 10%–to $101 million. Part of the decline was a result of a nearly $4 million sales decline due to store closings over the past five quarters.
Womble Carlyle PLLC, the Winston-Salem, N.C. law firm, is reducing expenses. With several offices on the East Coast, the company has initiated a 10% paycut for most of its staff while eliminating positions that it does not consider “essentialâ€.
(The Nation’s Oldest Daily Business E-Newspaper)
—The Day’s News in Capsule Form—
A Product of Bastien Financial Publications
(For more information contact us at 847-491-1900
or email <!-- e --><a href="mailto:usbj7@yahoo.com">usbj7@yahoo.com</a><!-- e -->)
Monday
April 20, 2009
(This daily e-newspaper is a copyrighted publication for the exclusive use
of the recipient only and is not to be forwarded or copied
in whole or in part for use by any other party.)
Educational Tidbits
For Today's Financial Executive
How Does You Credit Reporting Agency Rate?
The best credit reporting agency is one that provides you with the most comprehensive and updated business information, in both a timely manner and at a fair price. Do the major credit reporting agencies do this for you? Some say yes, some say no.
We would like your opinion if they do or do not live up to your expectations. On a scale of 1-10, with 10 being the best, rate the agency you purchase business credit reports from and tell us why you rate them the way you do. Email your opinions to <!-- e --><a href="mailto:usbj7@yahoo.com">usbj7@yahoo.com</a><!-- e -->.
The Business Professional’s
Q&A Corner
YESTERDAY’S QUESTION: Explain why a creditor should be aware of changes in ownership and what a creditor should do when this information is made available.
ANSWER: Creditors should be aware of a change in ownership for a number of reasons. The most obvious is the credibility and management capabilities of the new owner/management. Has their track record been successful? Are they experienced in the industry? What relationship, if any, do they have with their lenders? Is their character one you want to sell to? And look even closer when ownership changes hands in a closely-held family company–especially if that change in ownership is from a parent to a son or daughter. Will that offspring value the company in the same way their parents did?
QUESTION: Explain what a composition of creditors is.
ANSWER NEXT ISSUE
Today's Headlines:
AbitibiBowater Inc. files for bankruptcy protection...
Best Buy Co. Inc. sees one analyst anticipate 1,000 job cuts...
Briggs & Stratton Corp. reports its third quarter net income and net sales decline...
Callaway Golf Co. reports its first quarter net sales and gross profit decline...
Duckwall-Alco Stores Inc. reports a fourth quarter net loss on a revenue increase...
Gannett Co. reports its first quarter net and revenue decline...
Genuine Parts Co. reports its first quarter net and sales decline...
Harley-Davidson Inc. expects to reduce its workforce by up to 400 workers...
PPG Industries Inc. reports a first quarter net loss on a sales decline...
Upper Valley Medical Center to eliminate nearly eighty positions from its payroll...
Virco Manufacturing Corp. reports a net loss on a sales decline...
BANKRUPTCY NEWS
(For more information on these (or any) bankrupt firms
call the 800-number in your U.S. Bankruptcy Court Directory
available through Bastien Financial Publications.)
AbitibiBowater Inc., the giant Canadian newsprint firm which was formed two years ago with the merger of U.S.-based Bowater Inc. and Abitibi-Consolidated of Canada, has filed for bankruptcy protection under Canada’s Companies’ Creditors Arrangement Act and in the U.S. Bankruptcy Court in Delaware. The company filed along with more than thirty of its affiliates as it attempts to restructure its overall operations. The company’s subsidiaries outside Canada and the United States have not field. The Montreal company listed assets and liabilities in its Delaware filing of $9.9 billion and $8.8 billion respectively.
In a separate motion, the company has requested the U.S. Bankruptcy Court to approve both post-petition financing and authorization to use certain cash collateral.
For more information contact the U.S. Bankruptcy Court in Delaware at 302-252-2560.
All American Semiconductor Inc. has seen the U.S. Bankruptcy Court in Miami confirm the third amended plan of liquidation which was submitted by the unsecured creditors’ committee. For more information contact the court at 305-536-5979.
Autobacs Strauss Inc. has seen the U.S. Bankruptcy Court in Delaware set 5/22 as the final date for filing proof of general claims in the case. The government proof of claim deadline was set at 8/3. The case number is 09-10358. For more information contact the court at 302-252-2560.
Bettina Corp. dba Blue Dog Inc. of Dallas, Tx. has filed for Chapter 11 protection in the U.S. Bankruptcy Court for the Northern District of Texas. The maker of electronic bingo equipment listed assets and liabilities of $1.4 million and $4.4 million respectively.
For more information contact the court at 800-886-9008.
Foothills Texas Inc., has seen the U.S. Bankruptcy Court set the final date for filing proof of claims as 5/11. The case number is 09-10452. For more information contact the U.S. Bankruptcy Court in Delaware at 302-252-2560.
General Growth Properties, the Chicago, Il. mall operator which recently filed for Chapter 11 protection, is seeking U.S. Bankruptcy Court approval to hire certain attorneys and agents at as much as $965 an hour.
JPA Furniture Inc. filed Chapter 11 in the U.S. Bankruptcy Court in Arizona. The firm listed assets and liabilities of between $100,000 and $1 million each. A meeting of creditors is scheduled for 5/19. The case number is 09-07585. For more information contact the court at 888-549-5336.
M&D 1 LLC has filed Chapter 11 in the U.S. Bankruptcy Court for the Eastern District of Virginia. The firm listed assets and liabilities of between $1 million and $100 million each. The case number is 09-12936. For more information contact the court at 800-326-5879.
Oil and Gas Equipment Leasing LLC filed Chapter 11 in the U.S. Bankruptcy Court in Colorado. The company, headquartered in Lone Tree, Co., listed liabilities of $5.5 million. For more information contact the court at 720-904-7419.
Petrozone Inc. has seen an involuntary Chapter 11 petition filed against it in the U.S. Bankruptcy Court for the Northern District of Indiana. No schedules were listed. The case number is 09-21449. For more information contact the court at 800-755-8393.
Polaroid, the bankrupt camera company, has seen Hilco Trading LLC, a Northbrook, Il. firm, become part of an investment group that obtained U.S. Bankruptcy Court approval to purchase most of the assets of the 70-year-old firm.
Renew Energy LLC, which operates Wisconsin’s largest ethanol production operation, is selling its facility. The bankrupt firm reported that if it cannot find a buyer it will simply close the facility.
Roosevelt Lofts LLC has filed Chapter 11 in the U.S. Bankruptcy Court for the Central District of California. The firm listed assets of less than $500 million. The company’s largest unsecured creditors are Muir-Chase Plumbing Co. and Kultur Flooring USA Inc. For more information contact the court at 213-894-4111.
Rouse Co. at Owings Mills LLC and several of its affiliated firms filed Chapter 11 in the U.S. Bankruptcy Court for the Southern District of New York. The case numbers range from 09-12236 to 09-12249. Assets and liabilities were estimated at more than $1 billion each. For more information contact the court at 212-668-2772.
Santee Village Partners LLC has filed for Chapter 11 bankruptcy protection in the U.S. Bankruptcy Court for the Central District of California. The company, a real estate firm, listed assets of less than $50 million. For more information contact the court at 213-894-4111.
Schiappa Foods Corp., a Florida operator of fifteen Arby’s restaurants, has filed
Chapter 11 in the U.S. Bankruptcy Court for the Southern District of Florida. The company is based in Palm Beach Gardens, Fl. For more information contact the court at 305-536-5979.
Smart Office Systems Ltd. filed Chapter 11 in the U.S. Bankruptcy Court for the Western District of Michigan. The firm listed assets of between $100,000 and $1 million and liabilities of between $1 million and $100 million. The case number is 09-04503. A motion was made to sell nearly all of the debtor’s assets. For more information contact the court at 616-456-2075.
Sun-Times Media Group Inc. has seen a 4/29 meeting of creditors scheduled at the U.S. Bankruptcy Court in Wilmington, De. For more information contact the counsel for the debtor in Wilmington, Jamie Luton, at 302-571-6600.
Tusca Mediterranean Tapas has filed Chapter 11 in the U.S. Bankruptcy Court in Pittsburgh listing assets of less than $500,000 and liabilities of between $1 million and $10 million.
DISTRESSED / RAPIDLY-EXPANDING COMPANIES
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OTHER COMPANY NEWS
American International Group Inc., the beleaguered New York insurance firm which is trying to sell a number of its units in order to repay $182 billion to the Feds, is selling its 21st Century car insurance operations to Farmers Insurance in a transaction valued at $1.9 billion.
Allstate Insurance Co., the giant auto insurance firm, is expanding in the state of Georgia as it attempts to increase its market share. The company anticipates having an unspecified number of offices throughout Georgia as it seeks to hire laid-off professionals who received severance packages. Allstate is looking to hire agents that can spend the $50,000 needed to open an agency in that state.
Associated Banc-Corp, the Green Bay , Wi. firm which reported its first quarter net declined 47%–to $35 million and which reported its provision for loan losses jumped to $105 million from $65 million in the fourth quarter, reported its would cut its dividend payouts. At the end of the first quarter, the company reported non-performing loans reached more than $450 million. This compares with $340 million as of 12/31.
AXS-One Inc., the Rutherford, N.J. $13 million software firm, has been purchased by Unify Corp., a Roseville, Ca. software maker, in a transaction valued at $8 million. The transaction is expected to be finalized by 7/31.
Beck Imports of the Carolinas, an operation of Sonic Automotive Inc. which owns 160 automotive dealerships nationwide, has been purchased by Hendrick Automotive Group for an undisclosed amount.
Best Buy Co. Inc., the giant Richfield, Mn. electronics retailer which is attempting to reduce costs, has seen one analyst anticipate the company may reduce its workforce by 1,000 employees. Best Buy recently announced a demotion among its senior sales associates that would cut salaries by nearly 50%. The demotions are expected to affect nearly 8,000 employees.
Bioheart Co., the Sunrise, Fl. biotechnology firm which had only $50,000 in cash and cash equivalents as of 12/31, reported a fourth quarter net loss of $2.6 million. This compares with a loss of nearly $9 million for the same period in 2007. For the year, the company lost just over $14 million, an improvement from the $18 million it reported losing in fiscal 2007. The company’s auditors included a “going concern†letter along with the financial report..
Briggs & Stratton Corp., the Wauwatosa, Wi. small engine manufacturer, reported its third quarter net income declined 35%–to $25.3 million, on a 7% decline in net sales–to $674 million. The decline was partly a result of falling sales in its engines segment. The firm projected net income, for fiscal 2009, of as much as $32 million.
Callaway Golf Co., Carlsbad, Ca., reported net sales for its first quarter declined 26%–to $272 million while its gross profit declined 10%–to $116 million or 43% of net sales. A company spokesman reported that he believes the firm will outpace the industry, where industry-wide sales are expected to decline by as much as 20% this year.
Cedar Fair Entertainment Co., the Sandusky, Oh. amusement park operator which owns and operates the Knott’s Berry Farm park in California and which operates ten additional amusement parks, has hired Merrill Lynch & Co. to help it explore strategic alternatives that could include selling certain assets. In order to reduce its debtload, which, in part, was a result of its $1.2 billion purchase of Paramount Parks more than two years ago, the company is attempting to sell four of its amusement parks. Cedar Fair reported a fourth quarter net loss of nearly $57 million.
Charlotte Russe Holding Inc., a San Diego, Ca. mall-based specialty store retailer which operates nearly 500 outlets throughout the U.S., reported a second quarter net loss of $820,000. This compares with earnings of $4.2 million for the same period one year earlier. Net sales increased 3%–to $191 million.
Citigroup Inc., the financially-challenged New York banking firm, reported first quarter earnings of $1.6 billion, a turnaround from a $5 billion loss one year earlier and a $17.5 billion loss in the fourth quarter. The company now has $32 billion in capital reserves to provide for loan losses.
Cypress Semiconductor Corp. of San Jose, Ca. reported a first quarter loss of $91 million. This compares to a loss of $24 million for the same period one year earlier. Revenue declined 17%–to $139 million. Revenue beat analysts’ expectations.
Cytec Industries Inc., the Woodland Park, N.J. firm which experienced declining sales across all of its chemical products lines, reported a first quarter net loss of $100,000. This compares with income of $49 million for the same period one year earlier. Sales declined to $612 million during the first quarter from $973 million for the same period in 2008. At its Cytec Surface Specialties operations, sales declined 46%–to $243 million, while reporting an operating loss of nearly $21 million. At Cytec’s Engineered Materials operations, sales declined 15%–to $170 million while reporting operating earnings of $33 million. At Cytec Performance Chemicals, sales declined 28%–to $132 million while operating earnings declined more than 50%–to $5.8 million.
DVL Inc., the New York-based commercial finance and real estate firm, reported fiscal income from continuing operations declined to $1.8 million. This compares with $2.5 million for fiscal 2007. Revenue declined slightly–to $10.3 million.
Deltek Inc., the Herndon, Va. provider of enterprise applications software, expects its first quarter revenue to be below guidance estimates of $68 million. The company anticipates revenue of nearly $62 million. Citing the BearingPoint bankruptcy, Deltek expects its earnings per share to be no more than 6 cents as opposed to prior guidance of as much as 7 cents per diluted share. The company, which managed to reduce its debtload by more than $10 million during the first quarter, expects operating cash flow for the period of nearly $17 million.
Duckwall-Alco Stores Inc., the Abilene, Ks. retailer, reported a fourth quarter net loss of $715,000. This compares with income of $1 million for the same period one year earlier. Revenue increased 2%–to $138.5 million while gross margins for its fourth quarter declined from 30.3% to 29.7%. For the year, the company reported a widened loss of $5 million, up from a $224,000 loss for fiscal 2008. Revenue for fiscal 2009 increased 4%–to $478 million. Same-store sales for the company’s fourth quarter declined 3.3%, an improvement over the 6.3% decline during its third quarter.
Fidelity Southern Corp., the Atlanta, Ga. banking an insurance firm, reported a first quarter net loss of $3.4 million. This compares with earnings of $1.1 million for the same period one year earlier. During the quarter the company’s mortgage operations originated $85 million in new loans. This compares with only $6 million in new loans during the first quarter of last year.
First Horizon National Corp., the parent of First Tennessee Bank which received $860 million at the end of last year from the Fed’s TARP program, reported a first quarter net loss of $65 million on an 11% revenue decline–to $605 million. The loss compare with income of $12 million for the same period one year earlier.
Fred Hutchinson Cancer Research Center in Seattle, Wa. reported that as a result of declines in both investment income and philanthropic giving, the firm is laying off more than eighty employees in order to reduce costs.
Gannett Co., the giant McLean, Va. newspaper and broadcasting firm which saw advertising revenue for its publications decline by more than a third in its most recent quarter, reported its first quarter net declined 60%–to $77 million. Overall revenue declined 18%–to $1.4 billion. While broadcasting revenue declined 15%–to $143 million, on the bright side, the company’s digital revenue jumped tenfold–to more than $140 million.
General Electric Co., which has been adversely affected by the weak economy at its financial operations, reported its overall first quarter net declined 35%–to $2.9 billion. Revenue at the Fairfield, Ct. conglomerate declined 9%–to $38 billion. While revenue at the company’s industrial operations were flat, earnings at its finance unit declined 58% on a year-over-year basis.
General Environmental Management Inc., the Pomona, Ca. firm whose earnings didn’t meet those required in certain of its loan covenants, is seeking a waiver from its lender, CVC California LLC. The company lost $7 million last year, an improvement over the $16 million loss reported in fiscal 2007. Revenue increased 14%–to $35 million. Its deficit of nearly $12 million was cited as one reason for doubt in the firm’s ability to continue effectively operating.
Genuine Parts Co., the Atlanta, Ga. maker of industrial and automotive parts, reported its first quarter net declined 27%–to $89 million, on an 11% sales decline–to $2.4 billion. The company anticipates overall sales to improve throughout the year.
Google Inc., the giant Mountainview, Ca. internet firm, reported first quarter net of $1.4 billion, an improvement from the $1.3 billion reported for the same period one year earlier. Revenue increased 6%–to $5.5 billion. Analysts had expected net earnings of just under $1.6 billion for the company which reduced its workforce by 340 positions in its most recent quarter. It should be noted that the company recorded a $275 million charge for stock compensation during the period. Only last month, Google completed an offer to exchange certain employee stock options issued under the company’s 2004 stock plan. The company anticipates SBC charges for grants to employees prior to 4/1 to be just over $1 billion this year. As of 3/31, the company had cash and cash equivalents of nearly $18 billion.
Harley-Davidson Inc., the Milwaukee, Wi. motorcycle maker which reported its first quarter net declined 36%–to $117 million, now expects to reduce its workforce by as many as 400 additional workers. This is in addition to the 1,100 job cuts announced earlier in the year. Net sales for its most recent quarter declined slightly–to $1.3 billion.
Hawker Beechcraft Acquisition Co. LLC of Wichita, Ks. reported a first quarter operating loss of $41 million. This compares with an operating loss of $1.5 million for the same period one year earlier. Net sales for the first quarter declined to $538 million, down from $576 million for the same period in 2008. Over the past six months Hawker has announced reductions in its workforce of more than 2,700 jobs.
Insteel Industries Inc., the Mount Airy, N.C. maker of steel wire reinforcing products, reported a loss of $16.3 million for its first quarter. This compares with earnings of nearly $7 million for the same period one year earlier.
Kmart Corp., in a filing with the state of North Carolina, reported it would lay off more than seventy workers at one of its Wake County retail outlets. Kmart is a subsidiary of Sears Holding Corp. of Hoffman Estates, Il.
Krispy Kreme Doughnuts Inc., the Winston-Salem, N.C. firm which reported, in its most recent quarter, a narrowed loss and which recently reported reaching certain credit agreements with its lenders that would provide it with sufficient liquidity, saw its stock price rise more than 50%.
Landstar System Inc., a Jacksonville, Fl. trucking company, reported its first quarter earnings declined 40%–to just under $14 million. Revenue declined 23%–to $469 million. Purchasing $12 million of its own shares during the first quarter, the company, nevertheless, was reluctant to provide second quarter earnings guidance.
Media General Inc., the Richmond, Va. operator of newspapers and television stations, reported a first quarter net loss of $21 million, up slightly from a loss of $20 million during the first quarter of last year. Revenue declined to $159 million from $195 million for the same period one year earlier. While traditional ad revenue declined 25% during the quarter, online advertising increased 30% and digital revenue jumped 25%.
Meridian Bioscience Inc., the Newton, Oh. biomedical firm which was adversely affected by the mild flu season, reported flat earnings for its second quarter of $7.3 million. Net sales declined 8%–to $33 million. Earnings and sales were below analysts’ expectations.
Nationwide Mutual Insurance Co., Columbus, Oh., which earlier in the month announced it was reducing its workforce by 480 workers in order to save more than $16 million this year, has advised its more than 34,000 worker that it would cut back on a number of perks including the carry-over of vacation days and its associate referral program. The company lost $340 million last year.
Organic to Go, the rapidly-expanding Seattle, Wa. restaurant chain with more than 125 outlets nationwide, continues to expand in the Washington, D.C. area. The company, which was the first such restaurant to be certified as organic, is opening up its fifth D.C. outlet at the end of this month.
Orlando Opera Co. in Orlando, Fl., affected by the weak economy and declining ticket sales, will suspend its operations as of the end of this month.
PharmEcology Associates LLC, a Wauwatosa, Wi. firm which provides waste management consulting services to the pharmaceutical industry, has been purchased by WM Healthcare Solutions Inc., a unit of Waste Management Inc. of Houston, Tx., for an undisclosed amount.
Plexus Corp., the Neenah, Wi. electronics contract manufacturer, anticipates its second quarter will include charges of nearly $8 million as a result of goodwill impairment and its restructuring efforts. Earnings for the period are expected to be no more than 24 cents a share while revenue could reach just over $400 million.
Polaris Industries Inc., a Medina, Mn. maker of all terrain vehicles, saw its stock price increase 14% on news that its first quarter earnings, despite declining 55%, came in better than analysts expected.
PPG Industries Inc., the Pittsburgh, Pa. paint manufacturer, reported a first quarter net loss of $111 million. This compares with earnings of $100 million for the same period one year earlier. Sales declined 30%–to $2.8 billion. The loss included restructuring and after-tax charges of more than $140 million.
PPG Industries Fiberglass Products Inc., the unit of Pennsylvania-based PPG Industries, announced plans to reduce its workforce by ninety employees as of 5/1, citing a reduction in demand for its fiberglass products.
Renaissance Learning Inc., the Wisconsin Rapids firm which is the world’s leading provider of computer-based assessment technology for preschool through the 12th grade and whose learning tools have been adopted by more than 74,000 schools, reported first quarter net of $3.9 million, an increase from $2.6 million for the same period one year earlier. Revenue declined just under 2%–to $29 million.
Shaheen’s Department Store, the family-owned Louisville, Ky. apparel retailer, is expanding its operations in the Kentucky area with a new store expected to open by 4/30.
Sony Ericsson, the Swedish mobile phone maker, announced it would cut an additional 2,000 jobs from its workforce, citing a decline in global demand for its products. The company recently reported a first quarter loss of $386 million.
Sun Microsystems, the giant Santa Clara, Ca. firm which only weeks ago had been sought after by IBM of Armonk, N.Y. only to see Sun reject the $7 billion offer, has seen the New York firm react unresponsively to Sun’s recent efforts to restart purchase talks.
Sunoco Inc. of Philadelphia, Pa. is selling a Tulsa, Ok. refinery to Holly Refining & Marketing-Mid-Con LLC, a subsidiary of Holly Corp., a Dallas, Tx. petroleum refiner, in a transaction valued at $65 million.
Tempur-Pedic International Inc., whose world headquarters is in Lexington, Ky., reported first quarter net income of $13.3 million, down slightly from year-earlier quarter net of $13.5 million. Net sales declined 28%–to $177 million. The company, which is one of the world’s largest makers and distributors of mattresses and pillows, maintains its 2009 financial guidance for its earnings per share at no more than 90 cents per diluted share. The company, however, reduced its net sales guidance to no more than $740 million.
The Saint Louis Science Center, as part of its efforts to reduce costs, has offered early retirement packages to more than two dozen of its workers in St. Louis. The acceptance deadline was set at 5/4.
The News & Record, the Greensboro, N.C. newspaper which, like so many in the newspaper industry has been adversely affected by both the weak economy and reduced advertising revenue, is reducing its workforce by twenty-five jobs while also making changes to its newspaper in order to reduce overall expenses.
Toshiba Corp., the giant Japanese electronics conglomerate which is attempting to reduce its capital spending by 40%, intends on reducing its workforce by 3,900 temporary jobs in Japan. This comes on top of the 4,500 temporary workers the firm has already laid off.
Tyco Electronics Wireless Systems, the Lowell, Ma. unit of Tyco Electronics Ltd., is being purchased by Harris Corp., a Melbourne, Fl. communications and information technology firm, in a transaction valued at $670 million.
Umpqua Holdings Corp., the Portland, Or. parent company of both Strand, Atkinson, Williams & York Inc. as well as Umpqua Bank, reported a first quarter net loss of $10.6 million while operating revenue declined 17%–to $133 million. The loss, in part, was a result of loan losses from residential developments.
Unisys Corp., the Blue Bell, Pa. information technology firm, has landed a $92 million contract with the General Services Administration to provide help desk services for more than 14,000 computer systems.
Upper Valley Medical Center, the Troy, Oh. facility which is trying to save $5 million, is eliminating nearly eighty positions from its payroll. The company also intends on eliminating wage increases for its management staff this year.
Virco Manufacturing Corp., the Torrence, Ca. firm which recently extended its $65 million credit facility with Wells Fargo Bank for the next two years, reported a net loss of $3.2 million for its most recent quarter ended 1/31. This compares with a loss of $3.1 million for the same period one year earlier. Sales declined 15%–to $27.7 million. Gross margins, on a year-over-year basis declined from $10.4 million for the quarter ended 1/31/08 to $8.6 million in its most recent quarter. The company ended its fiscal year with no bank debt.
Werner Enterprises Inc., the Omaha. Ne. firm which is one of the nation’s largest truckload transportation and logistics firms, reported its first quarter revenue declined 23%–to $395 million. Earnings declined more than 16% during the period.
West Marine Inc., the Watsonville, Ca. boating supply firm, reported its first quarter revenue declined 10%–to $101 million. Part of the decline was a result of a nearly $4 million sales decline due to store closings over the past five quarters.
Womble Carlyle PLLC, the Winston-Salem, N.C. law firm, is reducing expenses. With several offices on the East Coast, the company has initiated a 10% paycut for most of its staff while eliminating positions that it does not consider “essentialâ€.