Seattle’s Best objects to Borders’ request to end agreement
New York City — Seattle’s Best Coffee LLC, a division of Starbucks Corp., has asked a bankruptcy judge to reject Border Group’s request to end the companies’ licensing agreement.
Borders is not entitled to cancel the agreement and continue to use Seattle’s Best’s trademarks and products, the coffee company said today in a court filing. Seattle’s Best also disputed Borders’s claim that terms of the agreement are excessive.
Earlier this month. Border’s asked for permission to end the licensing agreement. The company said that operating its own cafes would reduce the company’s licensing fees, cut costs and boost profit at the sites.
Seattle’s Best had cafes in 225 of Borders’s stores that have closed in bankruptcy, Starbucks said in a regulatory filing, Bloomberg reported. Seattle’s Best is owed about $5 million in trade debt, according to a summary of Borders’s largest creditors, Bloomberg said.
Neiman Marcus Q3 income more than doubles
Dallas — In another sign that the luxury market is turning around faster than other retailing segments, Neiman Marcus’ third-quarter profit more than doubled.
The company’s net income for the three months ended April 30 rose to $46.2 million, from $18.5 million.
Revenue rose 10% to $983.8 million, from $895.2 million last year. Same-store sales increased 9.7%.
Neiman Marcus operates 41 Neiman Marcus stores across the United States, 30 Last Call clearance stores and two Bergdorf Goodman stores in New York.
A mark-down of a different type
Shares of Target are on sale. After beginning the year slightly above the $60 mark, it has been a steady slide downward for the first five months of this year, and now shares regularly trade below $50.
The decline follows what had been a nice run up during the back half of 2010 as shares rose from around $49 at the beginning of last July to end the year at roughly $60. The first five months of 2011 have not been so kind, and Target’s stock gave back all of those gains. One explanation for the backslide is that sales and profits have not materialized as quickly as investors had hoped for as a result of such key initiatives as the REDcard Rewards 5% program and the rollout of the PFresh format to discount stores. While senior executives have asserted both programs are on track and meeting established performance metrics, simply meeting stated objectives usually isn’t enough to move a stock price higher.
Analysts want to see outperformance such as same-store sales that surpass estimates rather than simply fall at the midpoint of a range of possible outcomes. So while Target’s key strategies are working, they are not gaining traction as rapidly as analysts and investors anticipated during the back half of last year while they were biding up shares of Target.
The company’s performance has also been hindered by the pace of economic recovery which is occurring more slowly than some of the more optimistic forecasters presumed last year while this Spring’s high gas prices have shoppers thinking twice before putting discretionary purchases in their shopping carts.