Panama Paper Scandal Just Getting Started; Riding into the Pac Sun-set; How Victoria Secret Plans to Stay on Top

Paper fail…

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Image courtesy of Stuart Miles/FreeDigitalPhotos.net

The Panama Papers continue their entertaining journey of embarrassing plenty of world leaders. For instance, British Prime Minister David Cameron has been haplessly defending himself after some documents in the Panama Papers unflatteringly revealed how he profited from his late father’s offshore investments, set up by scandalized Panamanian law firm, Mossack Fonseca. His father’s investment fund, Blairmor, shrewdly avoided paying taxes in the United Kingdom by having company board meetings in Switzerland and the Bahamas. Four months before David Cameron became the Prime Minister, he had the good sense to sell his stake for a not-so-whopping $42,000. The Prime Minister called the revelations a ”private matter” but then went on to say that all of his assets are totally legit.  Except it was said eloquently and with a British accent, which always makes things sound even better. Chinese Communist Party Leader Xi Jinping’s brother-in-law, in addition to a few other party members, also owned a piece of a Mossack Fonseca created shell company. But it’s doubtful Jinping’s power and status will be affected. Especially because the (shell) companies in question were conveniently gone with the wind by the time he assumed his leadership role. Interestingly, only one American has been spotted, so far, amongst the 11.5 million documents. It belongs to that of Chicago-based author Marianna Olszewski. But like I said, there are millions of documents to sift through so it could take awhile before other misbehaving Americans are discovered. Or not. These documents were from one but one firm out of hundreds or thousands of firms, both American and foreign, that perform these types of services. Besides, the U.S. is itself a tax haven. Just look no further than Nevada and Delaware. In fact, the U.S. is ranked as the world’s third most popular tax haven. Panama is much less popular, ranking way down at number 13.

Not so gnarly…

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Image courtesy of Stuart Miles/FreeDigitalPhotos.net

SoCal-based company PacSun is the latest retailer to file for Chapter 11 bankruptcy after posting a $10 million net loss in its fourth quarter. The retailer only managed to nail a profit in just one quarter out of the last six. Add to that increased competition and you’ve got a whole big fiscal mess. But fear not, if you’re a frequent PacSun shopper, as there will be “no immediate impact” on customers at any of the chains approximate 600 stores. As for the retailer’s 2000 employees, their jobs are safe…for now, anyway. Pac Sun, incidentally, also carries the Kendall and Kylie Jenner line, just in case you felt like handing over your hard-earned cash to the Kardashian/Jenner/Kanye clan. Private investment firm Golden Gate will be the lucky group to take PacSun back to being a privately-held company. The investment firm previously lent Pac Sun $60 million back in 2011 and will now magically turn 65% of the company’s debt into equity. Okay, so there’s no magic involved, but there’s definitely some creative math at work. After its bankruptcy reorganization, the company will secure a $100 million revolving line of credit from Wells Fargo. The skate/surf California retailer owes plenty of cash to creditors including $5.7 million to Nike and another $3.8 million to Simon Property Group Inc., the mall operator that is home to many a PacSun stores. Shares of the company plunged as much as 97% in the past 12 months and took another nasty dive today, losing over 40% of its value at one point, as it hit 5 cents. The retailer will join a long and less-than-illustrious list of retailers who also recently filed Chapter 11, including Quiksilver, American Apparel, Wet Seal, Delia’s, Sports Authority…well, you get the grim picture.

In on the secret…

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Image courtesy of Stuart Miles/FreeDigitalPhotos.net

Victoria’s Secret (VS) is one retailer that is most definitely NOT filing for Chapter 11 bankruptcy. The company is actually at the top its fiscal game, posting a 3% sales gain over the previous year and record sales for 2015. But that isn’t stopping the insanely recognizable brand from making some pre-emptive changes, lest the retail climate fiscally change at some inconvenient point. Unfortunately, those changes involve some restructuring that will leave 200 employees without jobs in both the company’s New York and Ohio offices. Victoria’s Secret, whose parent company is L Brands, wants to streamline its operations by separating and concentrating on its top three units: lingerie, beauty and, of course, teen-centric brand, PINK. So what becomes of all the rest of Victoria’s Secret’s other categories of merchandise? They’re going buh-bye. VS, which also owns Bath & Body Works, plans to gradually shift gears away from its iconic catalog. Apparently, the internet managed to make the catalog, among other sales methods, a virtual relic – no pun intended.

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William Shatner Wants $30 Billion for Water; Harley-Davidson’s Wall Street Hits and Misses; Under Armour Needs to Bulk Up Projections

Rain rain don’t go away…

Image courtesy of Stuart Miles/FreeDigitalPhotos.net

Image courtesy of Stuart Miles/FreeDigitalPhotos.net

Leave it to Star Trek legend William Shatner to take California’s drought emergency straight to Kickstarter. The 84 year old actor and Priceline shiller wants people to beam him up some cash – $30 billion’s worth, to be exact – so that a  four foot above ground pipeline can be built from Seattle to Nevada’s Lake Mead. The fact that Seattle doesn’t have a surplus of water to really be giving out to California, which is in its fourth year of drought, doesn’t seem to bother Shatner much. I’m guessing he didn’t ask officials in Seattle their thoughts on the idea. California Governor Jerry Brown has already issued a drought emergency and apparently there is about a year’s supply of water left. Mr. Shatner isn’t entirely convinced himself that he can even raise the $30 billion needed to build the pipeline but he is hoping to raise awareness on the issue. “If I don’t make 30 billion, I’ll give the money to a politician who says, ‘I’ll build it.’ I don’t think that last part is the best idea Mr. Shatner has ever had, but its sure to get a few people talking.

Not so hog wild…

Image courtesy of dan/FreeDigitalPhotos.net

Image courtesy of dan/FreeDigitalPhotos.net

Profits for iconic Hog maker, Harley Davidson, are up thanks to a somewhat reduced tax rate. So why the sad faces on Wall Street over the price of its shares? Because those very shares took a 6% hit today over revenue that fell 3.4% to $1.51 billion, down from $1.57 billion a year ago. The bike makers also revised forecasts that have less bikers getting on those legendary two-wheeled machines. Harley-Davidson initially expected to deliver between 282,000 – 287,000 Hogs this year. But now that range is looking closer to 276,000 – 281,000 orders. Some of that, of course, can be attributed to that annoyingly strong U.S. dollar that seems to be sucking the fun from just about every company’s earnings these days. But Harley-Davidson has also had to deal with competitors  – hard to believe that anyone can compete with a Harley – who have been offering better discounts and totally messing with the motorcycle company’s earnings. The good news is that the motorcycle brand still took in $270 million and $1.27 per share, even though analysts only expected $1.24 per share. Can someone please get those analysts on a Harley? A year ago the Hogs pulled in about $265 million at $1.21 per share.

Dude, what gives?

Image courtesy of Stuart Miles/FreeDigitalPhotos.net

Image courtesy of Stuart Miles/FreeDigitalPhotos.net

Under Armour came out with earnings today and informed those that matter that it hit its revenue targets and raised its outlook. The Maryland-based athletic company even has PGA Masters Winner Jordan Spieth shilling for it. Under Armour also pulled in 5 cents per share on revenues of $805 million when analysts only called for $802.5 million. The apparel division grew 21% while the footwear division grew 41%. So why are investors still not satisfied with the athletic apparel company’s earnings? Here’s where things get dicey. Even though Under Armour raised its outlook for revenues from $3.76 billion to $3.78 billion, investors, analysts and others who throw large sums of money at the company expected higher projections of $3.82 billion in revenues. That $.o4 billion difference put a damper on the morning for many investors. Hence the stock took a bit of a hit this morning. Nothing major, just a few percentage points, but enough to put several Wall Street-ers in a bit of a snit.

Where in the World is Über?; Harvard Professor Gives Whole New Meaning to Chinese Take-out; See Which Company Made “The List”

Mo’ money, mo problems…

Image courtesy of renjith krishnan/FreeDigitalPhotos.net

Image courtesy of renjith krishnan/FreeDigitalPhotos.net

Über just picked up another $1.2 billion in funding and is now valued at $40 billon. Awesome, right? Not even close. On the heels of its most recent “tracking-customers” scandal comes even more…problems. So on which part of the globe should we begin? How about Portland, Oregon? You might have downloaded the Über app there but don’t bother using it. Hours after it launched, the city put the kibosh on the ride-sharing device. In Über’s home state of California, San Francisco D.A. George Gascón and Los Angeles D.A. Jackie Lacey have filed suit against Über for, among other issues, not being totally honest about the quality of the background checks it conducts on its drivers. Which brings us to Chicago where an Über driver allegedly raped a female rider. And just because gambling and prostitution is legal in Nevada, that doesn’t mean Über is. Yes, oddly enough, it’s banned there too. On the other side of the pond, good luck finding an Über ride. Denmark and Norway have filed complaints, a Dutch court ruled it illegal, France has yet to decide, while Spain already but the brakes on Über’s operations. In Asia, Thailand also nixed the service and India’s having huge issues with it as well. But on his blog, Travis Kalanick did mention that Über operates in 250 cities on 50 countries. He must mean on a different planet.

Can I get the sauce on the side?

Image courtesy of patrisyu/FreeDigitalPhotos.net

Image courtesy of patrisyu/FreeDigitalPhotos.net

If you’re going to overcharge your clientele, you best make sure they aren’t professors from Harvard’s Business School. Just ask Sichuan Garden’s Ran Duan. Except, he’s not so talkative lately. When Professor Benjamin Edelman ordered four dishes from the Boston eatery, he was over-charged a dollar more than the advertised price on the restaurant’s website.  So Professor Edelman, who, by the way,  fiercely and diligently took on the airline industry for misrepresenting fees, did the same with Mr. Duan. First, the professor suggested that Sichuan Garden refund him three times the amount of the over-charge. Mr. Duan, instead, offered to refund $3.00. After several emails were exchanged, which seemed to only fuel Professor Edelman’s irritation, he decided it was time to take the issue to the regulators, just as he had done with the airlines.  The lesson is? Well, there are several, aren’t there.

You call this work?

Image courtesy of portal/FreeDigitalPhotos.net

Image courtesy of portal/FreeDigitalPhotos.net

Is your company on Glassdoor’s 2015 50 Best Places to Work list? If not, maybe it’s time to polish your resume and start spending lots of time on LinkedIn, which by the way, takes the number 23 spot. It’s no surprise, I guess that Google made the list. After all, didn’t Vince Vaughn and Owen Wilson make a movie just about being interns there? However, this was the first time Google took the top spot. Among the many storied perks behind the company is twelve weeks maternity leave…for the father. So where does that leave mom? With an additional six weeks’ quality time with baby. Thinking of trekking down to Antarctica? Bain and Company, which ranks second, has got an expedition with your name on it. Just make sure they have a position you can fill. Facebook ranks at lucky #13 with one employee writing about it: “Transparency. Trust. Compassion. Food.” ‘Nuff said. Got IT problems? Great. Grab a beer and talk it over at Zillow’s “IT Happy Hour.” The real estate site ranks 33. Who is not in the top 50? Glad you asked. Twitter is noticeably absent from top 50 this year presumably thanks to some management “changes.”