A&F Earnings Are Out of Fashion; McDonald’s Biotic Changes; Target-ing Change

Teen-y tiny…

Image courtesy of David Castillo Dominici/FreeDigitalPhotos.net

Image courtesy of David Castillo Dominici/FreeDigitalPhotos.net

Teen-centric apparel company Abercrombie & Fitch took a fourth quarter beating. One of the (many) reasons seems to be that the fickle adolescent community got tired of advertising the A&F logo on their chests and butts. And like so many other companies, the strong U.S. dollar also seemed to be putting a crimp in the retailer’s numbers, especially considering that a third of the company’s revenue comes from outside the country.  Same store sales also decreased by 10%. Then there’s the part about how teens have been spending less money on clothing than in recent years, yet they are increasingly looking to outfit themselves through the likes of H&M, Forever 21 and Zara. Those chains tend to offer “fast fashion” that kids today totally dig at much better prices. Does that make A&F’s fashions slow? Hmmm. Oddly enough, American Eagle, one of A&F’s competitors actually beat the street with its earnings and even hit a 52-week high. Net sales of Abercrombie & Fitch fell 14% to $1.12 billion with  profits coming in at $44.4 million and 63 cents per share. Analysts expected $1.15 per share on $1.17 billion in revenue.  To add insult to injury, Abercrombie & Fitch is looking to unload its company jet , a relic from the days when big mouth CEO Michael Jeffries ruled the A&F empire.

Cured!

Image courtesy of  Idea go/FreeDigitalPhotos.net

Image courtesy of Idea go/FreeDigitalPhotos.net

If you’re not into chicken seasoned with antibiotics, then you’re in luck. McDonalds has decided to scrap that special feature from its poultry menu, except it’s going to take approximately two years to fully get there. Steve Easterbrook, who took over as CEO just three days ago, did promise some major changes at the the Golden Arches. The fast-food company has become increasingly concerned over “superbugs” that have caused about 23,000 deaths per year. McDonalds will still allow ionophores in its chicken products. Yum. But don’t sweat it too much. Ionophores are antibiotics meant for our feathered friends – not for humans. Phew. The chicken change will affect the 14,000 eateries in the United States, but don’t expect to see any changes in the 22,000 McDonalds restaurants abroad. At least not yet, anyway. While Chick-fil-A already did away with antibiotics-laced chicken a year ago, the fact that McDonald’s is set to make these changes is rather epic, being the largest fast food chain and all. Once McDonald’s gets its distributors and processors to alter the food (for the better, of course), it will make it substantially easier for smaller chains to follow suit. So, here’s to antibiotic-free chicken! Bon appetit!

About those unemployment benefits….

Image courtesy of jscreationzs/FreeDigitalPhotos.net

Image courtesy of jscreationzs/FreeDigitalPhotos.net

Big changes are in store for Target and it’s safe to say some of them won’t be welcomed. The giant retailer, who is in the process of literally closing up shop in Canada, is also in the process of trying to cut $2 billion in costs. Part of that cost-cutting includes job-cutting. Several thousand people will need to polish up their reumes and update their LinkedIn accounts as Target looks to cut most of those positions from its corporate headquarters and some position in India, as well. But Target’s got other big ideas that don’t involve applying for unemployment benefits. It’ll be running a huge Hispanic millennial campaign – apparently the first of its kind – and part of it involves teaming up the CW’s “Jane the Virgin” together with Target’s baby department. Then Target’s also looking to open up 15 more stores, however, eight of them will be CityTarget and TargetExpress stores which – you guessed it – will be taking an urban approach seeing as how they will be geared toward an urban crowd in a presumably urban location.

Electrolux Sucking Up GE Appliance; Soupy Sales; So Long, Boneless Chicken Sandwich Innovator

Suck it up…

Image courtesy of bplanet/FreeDigitalPhotos.net

Image courtesy of bplanet/FreeDigitalPhotos.net

AB Electrolux, the parent company of US brands Electrolux and Frigidaire, did a little shopping today when it picked up GE Appliance for the bargain basement price of $3.3 billion. It is the biggest purchase Electrolux ever made. The two companies combined are expected to pull in $23 billion in total sales which is a ridiculous amount of ovens and dishwashers, if you ask me. It’s also expected to save the company a whopping $300 million. What it won’t likely save are a number of jobs that tend to get lost following a business decision such as this.

Not so tasty earnings…

Image courtesy of tiramisustudio/FreeDigitalPhotos.net

Image courtesy of tiramisustudio/FreeDigitalPhotos.net

Apparently is soup is not good food, after all. That is, if you ask Millenials whose never-ending quest for tasty adventures and lack of loyalty seem to have allegedly affected Campbell Soup Co.’s less than flattering earnings. Campbell’s, which also owns Pepperidge Farm and V8 (should have had one) came out with fourth quarter earnings and while sales did rise 7%, to $1.85 billion, analysts were expecting $1.87 billion. Is it really all the fault of those Millenials? Hmmm. However, accroding to Campbell’s president and CEO Denise Morrison, the food industry is experiencing profound “change and challenge.” To me that sounds like code for it’s all the Millenials’ fault. But you could also ask more traditional comapnies like Pepsi and McDonald’s who have been losing ground to brands like Chipotle and whatever trendy drink those pesky Millenials favor this week. However, on the bright side, Campbell’s bright side, that is, shares are up almost 3% and its coming out with more than 200 new foods. So clearly there are still quite a few people left who think soup is indeed a good food.

RIP…

Image courtesy of tiverylucky/FreeDigitalPhotos.net

Image courtesy of tiverylucky/FreeDigitalPhotos.net

We bid farewell to yet another revolutionary. This time it’s to Truett Cathy, 93, the founder of Chick-fil-A. Better known these days for its opposition to gay marriage than for its boneless chicken sandwich and classic southern cuisine food that catapulted it to fame. The first Chick-fil-A graced the world back in 1967, in Atlanta and has since grown to more than 1,800 locations. Born into poverty, Cathy built up the chain to more than 1,800 eateries in 39 states, landing himself on the Forbes’ list of billionaires. The chain, also famous for the fact that it is closed on Sundays, posted more than $5 billion in sales in 2013.