Google’s Tax Troubles Continue in Madrid; Will Oreo Scoop Up Hershey?; Pier 1 Not Feeling the Outdoor Love

Mucho dinero…

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Image courtesy of Sira Anamwong/FreeDigitalPhotos.net

It was just another day in the life of Google as authorities raided its offices, this time in Madrid, Spain. At issue, yet again, is the search engine giant’s corporate tax practices in Europe and the looming question as to whether or not Google, and other big corporations like it, are steering their profits legitimately, in order to score a reduced tax rate. Spanish authorities are investigating the search engine giant to see if it has been in engaging in the  dark art we know as tax evasion. Back in May, France investigated Google for “aggravated financial fraud” and “organized money laundering” which both sound awfully sinister. France is hoping to get $1 billion from its investigation. Even Italy’s authorities are in on the action and looking to see if Google underpaid its taxes there as well.  Google already forked over $175 million in back taxes to British authorities, whose politicians are still whining because they feel that the amount was too low. Expect more post-Brexit griping. Naturally, Google and its peers are calling out their innocence and are adamant that they comply fully with tax rules. But, at any rate, the investigations still seem far from over.

Yummm…

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Image courtesy of Sira Anamwong/FreeDigitalPhotos.net

The mood is sweet on Wall Street with talk of a Hershey takeover from Oreo maker Mondelez International. Given that there’s a trend to cut back on the amount of sugar people have been consuming, the timing seemed opportune for a buyout of a company that makes the world’s most beloved -in my opinion, anyway – chocolate bar. Mondelez, which also makes Cadbury chocolates, is currently the second largest confection manufacturer in the world. If the buyout goes its way, it will become the number one sweets maker, as 90% of Hershey’s revenue comes from North America. Shares of Hershey shot up 22% on the tasty news, hitting a record high of $117.79. Shares of Mondelez also went up, just not as much. Hershey’s market value is about $21 billion, give or take. But in order for the buyout to go forward, the Hershey Trust would have to give its blessing. After all, it controls 81% of Hershey stock and voting rights. However if you’re looking for some hostile action, might I suggest you look elsewhere. Mondelez already pledged to not shed any jobs and to keep the illustrious Hershey name intact.

Missed it…

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Image courtesy of Sira Anamwong/FreeDigitalPhotos.net

It’s looking like a long walk off a short Pier 1 as revenue for the home store chain came in at a disappointing $418.4 million. That number might seem impressive, except that it wasn’t to analysts, who were expecting revenue closer to $420 million. The company lost $6 million in profits and 7 cents a share when predictions were for a 5 cent per share loss. If those figures weren’t depressing enough, then consider that last year at this time, Pier 1 took in revenue of $436.9 million with a $7 million profit and an 8 cents per share gain. Shares of the company are now 50% less than what they were a year ago. The big area to disappoint was outdoor furniture. Darn you, outdoor furniture. That category was supposed to bring in some boffo results, but instead proved to be a real downer. The table top category did nicely. Just not nice enough. Taking a page from Chipotle, the company will now attempt to march out a rewards program and even add a gift registry. Which is weird, because I assumed the company already had a gift registry. I even went to check just now and wouldn’t you know it? It doesn’t. In any case, the company is forging ahead with plans to close 20 stores, while it already shuttered 8 this past quarter. Pier 1 did, however, open another three stores, presumably in more economically hospitable areas.

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Pier 1’s Costly Errors; Twitter CFO Gets Hacked; Apple’s Powering Up

Taking a long walk off of a short pier…

Image courtesy of Stuart Miles/FreeDigitalPhotos.net

Image courtesy of Stuart Miles/FreeDigitalPhotos.net

Heads rolled at Pier 1  – or rather one head – as earnings were released and stunned everyone – just not in a good way. The numbers were so unexpectedly bad that shares took a heady nosedive of about 33%. It seems the company was just a bit too generous when it came to forecasting sales for itself this past year. Following a bunch of storms that wreaked fiscal havoc on the home decor chain and its 1000+ stores, Pier 1 figured, though apparently not in a mathematical kind of way, that it would recoup all that and more. It didn’t. CFO Charles Turner also was unable to adequately explain some supply-chain expenses and why those expenses are expected to go on and on and…I’m sensing a LinkedIn workshop in Mr. Turner’s future as he was replaced by Laura Coffey who will become the interim CFO. The company originally forecasted that it would pull in between 95 -$1.05 for the fiscal year, but not anymore. As those numbers took a dip, Pier 1 is now looking to gain between 80 – 83 cents per share.

Be-twittered…

Image courtesy of iosphere/FreeDigitalPhotos.net

Image courtesy of iosphere/FreeDigitalPhotos.net

If you’re amongst the Twitter followers of CFO Antony Noto – and no one is judging you if you are – you might have noticed some of the hundreds of tweets he sent out – within a span of about eight minutes –  trying to get unsuspecting followers to click on some dubious links. In fact, he was not trying to out-tweet the Kardashians. He’s got a way better excuse than that – his account was hacked. No word yet on whether he used the two-step verification process, though, he really ought to since his own company does offer it and the fact that his account was hacked shows he’s a regular person, just like you and I. But a Twitter spokesperson wouldn’t comment either way if he did use the verification option. Hmmm. That might be because if Mr. Noto did use the verification option and still got hacked, it’d mean there are holes in the option allowing for pesky hackers to get into not just Mr. Noto’s account but everyone else’s too. Or maybe it was just a bug, some say. Incidentally, this was not Mr. Noto’s first time with a Twitter issue. Back in November the CFO tweeted a message to a colleague that was presumably meant to be a private message about acquiring a company. It wasn’t private at all. Oops. This, by the way, comes on the heels of another hacking into Newsweek Magazine’s Twitter account.

Is there a coupon for that?

Image courtesy of Stuart Miles/FreeDigitalPhotos.net

Image courtesy of Stuart Miles/FreeDigitalPhotos.net

Apple is about to out-green even the greenest amongst us as it announced its plans to buy about $850 million worth of solar energy. In case you were wondering, that’s enough energy to power 60,000 homes. The tech giant is looking to supply its “spaceship” facility in Cupertino, which is still under construction, with all that energy. But that’s not all, folks. It will also be used to power all of Apple’s California retail locations, of which there are 52, by the way, its data center and its offices. First Solar is the lucky recipient of this 25 year contract and the ever-indutsrious Tim Cook said, “We are doing this because it’s right to do, but you may also be interested to know that it’s good financially to do it.” Warms the heart, no?