FINANCE

HSN acquires Chasing Fireflies brand

BY Katherine Boccaccio

St. Petersburg, Fla. — HSN announced Monday it has acquired lifestyle brand Chasing Fireflies. Terms of the transaction weren’t disclosed.

The purchase, which was made through the multichannel retailer’s Cornerstone Brands segment, will accelerate HSN’s move into content-driven lifestyle businesses.

“We are excited about the opportunity to partner with the innovative team at Chasing Fireflies as we build and diversify our interactive, direct to consumer portfolio of content driven lifestyle businesses,” said Mindy Grossman, CEO. “This acquisition will leverage Cornerstone’s strong infrastructure, customer file and digital platform to drive additional growth for the brand.”

Chasing Fireflies will maintain its Seattle headquarters offices and continue to be run by its current team.

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OPERATIONS

Banana Republic, Google Offers join Starbucks in jobs effort

BY Katherine Boccaccio

Seattle — Starbucks Coffee Co. said Tuesday that Google Offers and Banana Republic are joining with Starbucks and Opportunity Finance Network to support the Create Jobs for USA program.

The pair, which are the first businesses to join Starbucks in the initiative, will run special promotions and make donations in support of the program that is designed to raise money to put Americans back to work.

Google’s and Banana’s support value will be as high as $4 million. The fund already has raised more than $7.5 million and, with the two additions, about $80 in lending would be supported, enough to create or sustain more than 3,800 jobs, Starbucks said in a statement.

“We thank Google Offers and Banana Republic for their leadership and support of this job creation program that is already helping thousands of Americans get back to work during a time of continued high unemployment,” said Starbucks chairman, president and CEO Howard Schultz.

Starbucks and OFN teamed up to launch Create Jobs for USA last November to help address the jobs crisis. Contributions to the Create Jobs for USA program are pooled and awarded as loans to help create and sustain jobs in underserved communities throughout the country.

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News

Earnings put on the brakes at Pep Boys in Q4

BY CSA STAFF

PHILADELPHIA — Pep Boys sales were up in the fourth quarter, but were earnings were down on merger costs and other expenses. The company reported that sales for the thirteen weeks ended Jan. 28 increased by $27.9 million, or 5.9%, to $505.3 million from $477.4 million for the thirteen weeks ended Jan. 29, 2011. Comparable sales increased slightly (0.8%) and consisted of a decrease of 0.1% in comparable service revenue and an increase of 1% in comparable merchandise sales.

Pep Boys reported a net loss for the fourth quarter of fiscal 2011 was $4.4 million (8 cents loss per share) compared with net earnings of $8.4 million (16 cents per share) recorded in the same period last year. The loss for the quarter includes, on a pre-tax basis, a net charge of $0.9 million comprised of a $1.2 million asset impairment charge and $0.8 million of merger and other transaction related costs, mostly offset by a $1.1 million reduction in its reserve for excess inventory, the company said. The fourth quarter fiscal 2010 results include, on a pre-tax basis, a $4.6 million reduction in the reserve for excess inventory. The fourth quarter fiscal 2010 results also included a $1 million tax benefit.

For the fiscal year, sales increased by $75 million, or 3.8%, to $2.06 billion from $2 billion for fiscal 2010. Comparable sales decreased 0.6%, consisting of a 0.6% comparable service revenue increase offset by a 0.9% comparable-merchandise sales decrease. In accordance with GAAP, service revenue is limited to labor sales, while merchandise sales include merchandise sold through both our service center and retail lines of business.

Net earnings for fiscal year 2011 were $28.9 million (54 cents per share), a $7.7 million decrease from the $36.6 million (69 cents per share) recorded in fiscal 2010. The fiscal 2011 results included a $3.5 million tax benefit, while the 2010 results included a $2.1 million tax benefit. The fiscal 2011 results also include, on a pre-tax basis, a net charge of $2.8 million comprised of a $1.6 million asset impairment charge, $1.5 million of acquisition and transition expenses related to the company’s purchase of Big 10 Tires, and $0.8 million of merger and other transaction related costs, partially offset by a $1.1 million reduction in its reserve for excess inventory. The fiscal 2010 results include a net benefit of $8.4 million comprised of a $5.9 million reduction in the reserve for excess inventory, a $2.5 million gain from the disposition of assets and a $1 million reversal of an inventory related accrual, partially offset by a $1 million asset impairment charge.

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