Landstar, Fidelity employees working at home

“The transition of so much of our employee base to work at home has been a great success and currently it is business as usual at Landstar,” CEO says.

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  • | 5:10 a.m. April 30, 2020
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The Landstar System headquarters at 13410 Sutton Park Drive S. overlooks the Windsor Parke Golf Club.
The Landstar System headquarters at 13410 Sutton Park Drive S. overlooks the Windsor Parke Golf Club.
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While many companies have sent employees home to work remotely during the COVID-19 pandemic, you might think that’s impossible for a trucking company like Jacksonville-based Landstar System Inc.

Yes, technology is moving closer to sending driverless vehicles out on the road, but we still live in a world where trucks transporting freight need drivers in the cabs.

However, Landstar is a trucking company that doesn’t employ drivers. It contracts with drivers who own their trucks to transport freight, which it refers to as business capacity owners, or BCOs.

Landstar has about 1,200 corporate employees, working in Jacksonville and a second site in Rockford, Illinois.

During the company’s quarterly conference call with analysts last week, CEO Jim Gattoni said Landstar began sending most of its employees home in mid-March and more than 1,000 now are working remotely.

“The transition helped to secure business continuity and maintain a healthy work environment for Landstar’s employees,” he said.

“From an administration and operations standpoint, the transition of so much of our employee base to work at home has been a great success and currently it is business as usual at Landstar,” he said.

Landstar also is trying to assist the nonemployees who contract with the company, paying an extra $50 for every freight shipment in April to each of its 10,000 BCOs and 1,200 agents who dispatch the loads, Gattoni said.

“We also are providing $1,000 per week for a two-week period to any BCO who contracts COVID-19 or has been mandatorily quarantined by public health authorities,” he said.

Jacksonville-based title insurance company Fidelity National Financial Inc. also sent most of its workers home, Chairman Bill Foley said during its conference call last week.

“At the onset of the pandemic, our management team worked to transition nearly 80% of our more than 25,000-person workforce based throughout the U.S., Canada and India to a remote work environment, focusing on productivity without foregoing security,” he said.

Foley said Fidelity made “significant investments” in technology well before the pandemic.

“This has enabled the title production and title commitment process to continue to flow smoothly,” he said.

Fidelity: Acquisition remains on track

The pandemic has interrupted merger plans at a number of companies, but it has not disrupted Fidelity’s $2.7 billion agreement announced in February to buy FGL Holdings.

FGL operates a Des Moines, Iowa-based annuity and life insurance company called Fidelity & Guaranty Life. That company is not related to Fidelity National Financial.

“We are well on track to completing the acquisition by the end of the second quarter or the beginning of the third quarter, once we receive all regulatory and F&G shareholder approvals,” Foley said during last week’s conference call.

FGL has scheduled a virtual shareholders meeting May 29 to vote on the agreement.

Foley said the company still expects the deal to increase its earnings per share by 10% this year and by 20% in 2021.

“We continue to be excited about the opportunity to combine the F&G business with FNF, given the many strategic benefits that we see even in a more challenged working environment like what we are experiencing today,” he said.

Rayonier targets May 8 for Pope deal

Rayonier Inc. said in a Securities and Exchange Commission filing that it expects to close its acquisition of Pope Resources on or about May 8.

Rayonier agreed in January to buy the timber company for $554 million in cash and stock to add more timber resources in the Pacific Northwest to its portfolio.

The agreement calls for Rayonier to buy Pope with a combination of cash and stock, with 30% of the purchase price expected to be in cash.

Nassau County-based Rayonier said in the SEC filing it raised an additional $116 million at the end of March by selling 67,000 acres of timberland in Mississippi.

Including the timber sale proceeds, Rayonier had about $390.9 million in cash on hand as of April 16, it said.

Ameris earnings drop in first quarter

Ameris Bancorp, which moved its executive offices from Jacksonville to Atlanta last year, reported lower earnings for the first quarter.

The company last week reported adjusted earnings of 56 cents a share, down from 90 cents in the first quarter of 2019. 

The earnings were 19 cents lower than the consensus forecast of analysts surveyed by Zacks Investment Research.

Ameris said earnings were lowered by an increased provision for loan losses and a write-off of servicing assets.

Ameris operates 170 branches in Georgia, Florida, South Carolina and Alabama. The company said it is keeping drive-through services open at all of its offices but the branch lobbies are available for customers only by appointment.

Regency Centers downgraded

J.P. Morgan analyst Michael Mueller last week downgraded Regency Centers Corp. from “neutral” to “underweight” even after the stock lost half its value since February.

“While the stock has already underperformed, our take is that it could continue to lag over the near-term as COVID-19’s impact on operations begins to unfold,” Mueller said in his report on Regency and other companies that operate strip shopping centers.

Jacksonville-based Regency focuses on operating centers anchored by supermarkets, which are remaining open in the pandemic.

But Mueller said Regency also “tends to have greater small shop exposure than others and this tenancy is typically where headwinds can emerge…particularly as it relates to locals.”

Mueller expects “significant” levels of nonpayment of rents for April and May and many stores to close permanently, which will affect all shopping center companies.

However, he considers Regency a “blue chip” stock in the sector “with a strong platform and top-notch portfolio quality.”

The recent price drop “could translate into an opportunity for the stock once there is more clarity on how impacted go-forward operations will ultimately be because of COVID-19.”

Morgan Stanley analyst Richard Hill also touted Regency’s operations in a report on strip center stocks this week.

“Regency is our top pick long term, but we maintain our ‘equal weight’ rating as pronounced uncertainty surrounding retail real estate limits near-term catalysts,” Hill said.

Boeing calls off deal with Embraer

Nearly two years after agreeing to form a joint venture with Brazil-based Embraer S.A, The Boeing Co. announced April 25 it was terminating the strategic partnership agreement.

However, Embraer claimed Boeing wrongfully terminated the deal.

The $4.2 billion agreement would have created joint ventures for Embraer’s commercial aviation business and its C-390 military jets.

It did not involve Embraer’s assembly facility at Jacksonville International Airport for its A-29 Super Tucano military aircraft.

Boeing has a repair and modification facility in Jacksonville at Cecil Commerce Center.

Boeing said in a news release that Embraer “did not satisfy the necessary conditions” to complete the deal. Embraer responded with a statement saying Boeing “manufactured false claims as a pretext to seek to avoid its commitments to close the transaction.”

Embraer accused Boeing of engaging in “a systematic pattern of delay” and violating the agreement “because of its unwillingness to complete the transaction in light of its own financial condition and 737 MAX and other business and reputational problems.”

The Brazilian company issued a statement April 27 saying “arbitration proceedings have commenced” between the two aerospace companies.




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