New Feature: Credit Manager?s Weekly Summary

This week, insideARM initiates the posting of an abbreviated version of the Credit Manager’s Weekly Summary of Financially-Challenged U.S. Companies. The 10 articles below are taken from the Summary dated 1/14/08. A full issue contains information on over 200 companies.

The Summary recaps news of note for credit managers seeking to know if companies are:

Losing money; Facing declines in sales and earnings; Laying employees off; Selling off assets; Changing management; Merging with another company; In bankruptcy and what is the current state of that bankruptcy; and more. 

Please visit the insideARM bookstore for a sample of a full issue of the Credit Manager’s Weekly.

Credit Manager’s Weekly Summary (abbreviated) of Financially-Challenged U.S. Companies – 1/14/08:

Bon-Ton Stores Inc., a York, Pa.-based department-store operator, reported that its sales in December sank 13%–to $558 million, including an 11% drop in same-store sales at its Bon-ton and Carson’s locations. The firm operates more than 270 department stores under names including Bon-Ton, Parisian, Herberger’s, Elder-Beerman and Carson Pirie Scott.

Cato Corp., a Charlotte, N.C. operator of women’s apparel stores, said that sales for the five weeks ended 1/5/08 fell 6%–to $94.6 million, including an 8% drop in same-store sales. The company, with more than 1,300 locations, added that it anticipates fourth quarter results to come in between a loss of 8 cents a share and a breakeven point.

Electronics for Imaging’s stock price plunged 31% after the Foster City, Ca. publishing hardware and software firm predicted that earnings in its fourth quarter will fall short of analysts’ expectations.

Interstate Bakeries Corp., the bankrupt Kansas City, Mo. maker of Wonder Bread and Twinkies, lost its exclusivity period for filing a Chapter 11 reorganization plan, meaning that others can now present their own plans. That could be a complication for Interstate, which is trying to line up investors for exit financing.

Kohl’s Corp., the Menonomee Falls. Wis. operator of department stores reported that sales fell 3.4% in December–to $2.7 billion, on a more than 11% drop in same-store sales. Also, Kohl’s warned that, because of cutting prices, its fourth quarter profit could be reduced by about 10%.

Leiner Health Products, a privately-held Carson, Ca. drug company, is closing a manufacturing facility in Wilson, N.C. and cutting 171 jobs from its payroll, in an effort to save money. The company last year lost $22 million on sales of $735 million.

Limited Inc., the Columbus, Ohio-based retailer, reported that its same-store sales in December fell 8%, with total sales falling 14%–to $1.7 billion.

Ruby Tuesday Inc.’s stock price sank 14% after the Maryville, Tenn. operator of restaurants and cafeterias reported a loss for its second quarter, reduced its outlook for the full year and warned of possible defaults on borrowing agreements.

WCI Communities’ junk-status rating was affirmed by Standard & Poor’s, which said that the homebuilder needs to arrange better terms on more than $950 million of revolving credit and secured bank loans. In November, WCI’s corporate credit rating was lowered from CCC+ to CCC following a nearly $70 million loss and a string of defaults.  S&P holds a negative outlook for Bonita Springs, Fla.-based WCI, which builds luxury homes.

Zale Corp., an Irving, Texas jewelry retailer, said that sales for the two-month holiday shopping season fell 10%–to $723 million, including a 9% drop in same-store sales. Zale also predicted that same-store sales in the second quarter will fall another 8% or 9%.