Tapestry says digital sales are producing nearly half of its North American revenue.
With the COVID-19 pandemic bringing additional pressure to brick-and-mortar retailers, Tapestry Inc.’s “digital first mindset” is producing higher earnings.
The parent company of the Coach, Kate Spade and Stuart Weitzman lifestyle brands said last week it had triple-digit e-commerce sales growth in the second quarter ended Dec. 26, with almost half of its North American revenue coming from digital sales.
The New York-based company handles all of its North American distribution for Coach products from a facility in Jacksonville International Tradeport near Jacksonville International Airport.
Tapestry still has 374 Coach stores in North America but with increased reliance on digital, profit margins are increasing.
Total second-quarter sales fell 7% to $1.69 billion and sales at its biggest brand, Coach, fell 4% to $1.23 billion.
However, Tapestry’s adjusted earnings in the quarter rose by 5 cents a share to $1.15.
The Coach division’s operating income rose 7.6% to $412 million.
Tapestry said it “recruited” 1.5 million new customers in North America in its e-commerce business across all three brands.
“As we enter the second half of our fiscal year, we are optimistic for the future in spite of the uncertain backdrop,” CEO Joanne Crevoiserat said in a news release.
“We are listening closely to consumers and responding in real-time to changes in their values, shopping behaviors, and brand engagement,” she said.
Rayonier earnings beat estimates
Rayonier Inc. reported fourth-quarter earnings last week that were lower than the previous year but better than analysts’ forecasts.
The timber and real estate company based in Wildlight in Nassau County had adjusted earnings of 8 cents a share, down from 12 cents in the fourth quarter of 2019.
However, the earnings beat the consensus forecast of 5 cents by analysts surveyed by Zacks Investment Research.
“As we look to 2021, we believe we are well-positioned to capitalize on favorable sawlog trends associated with increased residential construction activity, continued strong end-market demand for products derived from our pulpwood, improved log export market opportunities and growing interest in finished lots as well as rural and recreational properties,” CEO David Nunes said in a news release.
Rayonier’s stock has been trending up in early 2021 and reached a 52-week high of $34.35 on Feb. 10, up from $29.38 at the end of 2021.
BMO Capital Markets analyst Mark Wilde said in a research note the “near-term backdrop has improved” after the earnings report.
“Positives include a rational management team and a strong board,” Wilde said.
But “we remain on the sidelines at Market Perform.”
CoreLogic agrees to $6 billion buyout
After months of prodding by Cannae Holdings Inc. to make a deal, housing data firm CoreLogic Inc. agreed to a $6 billion buyout last week.
CoreLogic said its board agreed to a buyout at $80 per share by funds managed by Stone Point Capital and Insight Partners.
The California-based company said the purchase price represents a 51% premium to its June 25 share price. That was the day before Cannae, the investment firm spun off from Jacksonville-based Fidelity National Financial Inc., and Senator Investment Group LP offered to buy CoreLogic for $65 a share.
CoreLogic’s board of directors rejected the unsolicited offer, triggering a proxy fight with Cannae and Senator.
Cannae and Senator were able to get three directors elected to CoreLogic’s board in November and continued to push for a sale, saying they would support a deal from another party that maximized shareholder value.
The deal with Stone Point and Insight is “a very positive outcome for our shareholders who will receive exceptional value for their shares in cash with a high degree of regulatory certainty and a closing expected in the near term,” CoreLogic Chairman Paul Folino said in a news release.
“The transaction is the culmination of our Board’s extensive review of strategic alternatives, which included engaging with numerous potential buyers,” he said.
Cannae and Senator made no public statement about the deal after the buyout agreement was announced Feb. 4.
Loss at Patriot Transportation
Patriot Transportation Holding Inc. last week reported a loss of $222,000, or 7 cents a share, for the first quarter ended Dec. 31, with revenue falling 18.5% to $20.2 million.
The Jacksonville-based trucking company said the drop in revenue was in part due to downsizing of two customer accounts and the closing of a terminal in Wilmington, North Carolina.
Patriot also was affected by driver turnover. The company said the hiring environment for drivers is improving but it takes six weeks to hire and train drivers before they can produce revenue for the company.
“The driver shortage and related hiring and turnover challenge continues to be a problem for us and the trucking industry as a whole,” CEO Robert Sandlin said in Patriot’s quarterly conference call.
Patriot, which focuses on transporting fuel products, said the COVID-19 pandemic also continues to affect its business by reducing demand for oil and petroleum.
Patriot estimates demand for oil and petroleum is about 5% to 15% below normal.
Allstate selling its life insurance unit
Allstate Corp. reported a big gain in 2020 earnings as it prepares to sell its life insurance subsidiary.
The insurance company last week reported adjusted earnings jumped 33.7% in 2020 to $4.65 billion, or $14.73 a share.
Revenue was basically flat at $44.8 billion.
“Insurance underwriting margins continued to be above the prior year, reflecting fewer auto accidents and strong homeowners insurance results,” CEO Tom Wilson said in a news release.
The earnings report came a week after Allstate announced an agreement to sell Allstate Life Insurance Co. for $2.8 billion to entities managed by Blackstone.
“Allstate is deploying capital out of lower growth and return businesses while continuing to execute our strategy to grow market share in personal property-liability and expand protection solutions for customers,” Wilson said in that news release.
In response to an email inquiry, Allstate said it didn’t have any immediate details on how that sale might affect its operations in Jacksonville.
Northbrook, Illinois-based Allstate has operated an office complex on San Pablo Road, south of Butler Boulevard, since it acquired Jacksonville-based American Heritage Life Investment Corp. for $1.1 billion in 1999.
Deutsche Bank reports profit
Deutsche Bank last week reported a 2020 profit of 624 million euros (about $750 million), reversing a 5.3 billion euro 2019 loss as the company continues its restructuring plan.
“We hit all our targets and key milestones in 2020 and over the last 18 months, despite the challenges of COVID-19,” CEO Christian Sewing told analysts, according to a company transcript of its conference call.
Its restructuring included reducing its global head count by about 3,000 to 84,659 last year. Sewing said employment has been reduced by 8% in the last two years.
The Germany-based bank employs about 2,000 people in Jacksonville, its biggest U.S. operation outside of New York.
The head of its U.S. operations told the Financial Times in December that Deutsche Bank is considering reducing its New York staff of about 4,600 and moving jobs to lower-cost cities.
However, after that report, a Deutsche Bank spokesman said the company would not comment on the possibility of more jobs coming to Jacksonville.