American Apparel Battles; Not So FedEx-cellent Earnings; Cheerie-Woes

Gone but not forgotten…

Image courtesy of biosphere/

Image courtesy of biosphere/

Dov Charney may be officially ousted from American Apparel but wouldn’t you know it…the former CEO, who was booted over a number of misconduct allegations,  still has more than a few friends left at the company he founded. Thirty American Apparel executives just can’t bear the thought of manufacturing retail with provocative ad campaigns without Mr. Charney’s particular skill set. They are a bit peeved that their feelings were not taken into consideration and, in a carefully penned letter, asked the board to reconsider its decision adding, “he makes this thing tick.” A beautiful sentiment for a man who had a slew of sexual harassment allegations against him. Incoming CEO Paula Schneider will become Charney’s official replacement and she gets to plod through the mammoth task of trying to reverse the $300 million in net losses the company racked up since July of 2010. Charney, though, won’t be totally on the outs seeing as how he remains the largest shareholder in the company with a 43% stake in it. He does, however, have to share those voting rights with a hedge fund, presumably to keep him from exercising those rights exclusively for his  questionable benefits.

Shipping dipping…

Image courtesy of Mister GC/

Image courtesy of Mister GC/

FedEx had a good quarter. Just not good enough for Wall Street. Earning’s for the shipping company were up a very merry 23% thanks in part to a drop in fuel prices. The company earned $616 million and $2.14 per share. That figure was up from $500 million and $1.57 per share the year before. Revenue was even up 5% to $11.94 billion. But the hardly-ever-content Wall Street analysts wanted to see $2.22 per share and revenues of $11.97 billion. Next quarter should be more telling as this is the company’s busiest time of year. Here’s hoping that FedEx won’t repeat last year’s shipping debacle when over 2 million packages failed to make it to their recipients by Christmas Eve – a gaffe that was attributed to some icy weather and an unforeseen rise in shipping demand. Which I suppose is the one of the reasons an additional 50,000 employees were added to its workforce this season.


Image courtesy of rakratchada torsap/

Image courtesy of rakratchada torsap/

General Mills, like many of its breakfast-oriented peers/competition, posted second quarter earnings that were nothing to crunch about. Profit for the maker of one the world’s most arguably famous cereals, Cheerios, dropped by a whopping 37%. With consumer tastes  changing, shoppers aren’t exactly spending as much time and money on cereals and other products from the company. But at least its Yoplait and snack divisions are up. A bit. General Mills earned $346 million and $0.80 per share. But Wall Street wanted to see $0.03 more on those shares. The company pulled in sales of $4.71 billion, which seems like a lot of Cheerios, except that Wall Street was gunning for $4.79 billion. Sales in the US alone came in at $2.86 billion but it was still a 4% drop.


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