CEO Makes Bid to Take Trans World Private
Trans World Entertainment Corp. chairman and CEO Robert J. Higgins has offered to buy out existing shareholders to convert the struggling retailer to a private company, according to The Business Review. Higgins has made a non-binding offer to buy out existing shareholders at $5 per share cash.
Trans World owns more than 950 retail stores, most under the name F.Y.E. (For Your Entertainment) and others under the Suncoast name. As of 2006 more than 600 people worked at the company’s headquarters and distribution center at 38 Corporate Circle.
The news comes as Trans World, which had sales of $1.47 billion last year, prepares to enter the holiday shopping season. The company has seen its sales suffer as it tries to compete with big-box retailers such as Wal-mart and Best Buy who sell music and videos at cheaper prices, and with computer downloads of music, both legal and illegal.
According to the company, Higgins has contacted another shareholder, Bryant Riley, to gauge his interest in participating directly or indirectly in the buyout.
Study: Premium food popularity growing
LYON, France A Reportlinker.com report determined that retail sales of gourmet, specialty and premium foods and beverages are growing at much at a faster pace than those of the overall food and beverage industry in the United States, surging 10.9% to $59 billion in 2007 and maintaing a compound annual growth rate of 11.1% for the 2003 to 2007 period.
Greater availability of gourmet and premium products, growing interest in world cuisines and flavors, the association of high-quality ingredients with health and wellness, overlap of gourmet and natural/organic, the supermarket industry’s focus on upscale “fresh formats,” higher disposable incomes among U.S. consumers, and product positioning as affordable luxuries have enticed the consumer and driven sales. Such factors have helped produce a growing population of willing-to-spend consumers who are looking for foods that are more adventuresome and yet more nutritious.
Gap Inc. October comps fall
SAN FRANCISCO Gap Inc. today reported a comparable-store sales decrease of 8% for the four weeks ended Nov. 3, compared to 7% for the period ended Oct. 28, 2006. The company reported net sales of $1.23 billion for the October 2007, which represents a 1% decrease compared with net sales of $1.24 billion for the same period last year.
By segment, comps for Gap North America fell 7% versus a 4% drop last year, Banana Republic North America comps were down 2% versus a 2% growth last year, Old Navy North America comps dropped 11%, same as last year, and international comps were down 6% versus a decrease of 8% last year.
“While comparable-store sales were down in October, merchandise margins were significantly above last year,” said Sabrina Simmons, evp of Gap Inc. finance. “The results reflect our stated strategy of managing inventory tightly to support margin improvements.”
For the thirteen weeks ended Nov. 3, total company net sales were $3.85 billion, which is flat as compared to net sales of $3.85 billion for the thirteen weeks ended Oct. 28, 2006. The company’s third quarter comparable-store sales decreased 5% compared with a decrease of 5% in the third quarter of the prior year.
For the third quarter of fiscal year 2007, Gap Inc. expects diluted earnings per share to be 28 cents to 30 cents, as the company continues to make progress on its strategies of driving earnings with healthy margins and controlling expenses.