Month: August 2016

Doth Yum protest too much about latest report of possibly leaked ultra-secret KFC recipe? More questions surface!

KFC’s corporate parent has insisted once more that a Chicago newspaper story last week purportedly revealing founder Colonel Harland Sanders‘ closely-guarded recipe of 11 herbs and spices got it wrong.

But Yum’s latest pushback raises new and vital questions about what it really knows!

KFC bucket of chickenThe story gained renewed traction when The New York Times picked it up yesterday, prompting Yum to issue a statement to the nation’s newspaper of record and its 77 million readers:

“Many people have made these claims over the years and no one has been accurate — this one isn’t either.” That was essentially the same thing Louisville-based Yum told the Chicago Tribune.

Last week, a Tribune freelance writer said Sanders’ nephew had revealed the recipe after discovering it in his aunt’s scrapbook; she was Sanders’ second wife. In a follow-up interview, the nephew, Joe Ledington, a 67-year-old retired school teacher outside Corbin, Ky., tried to walk back his claim, apparently worried he’d let the chicken out of the bag.

But Yum’s insistence raises so many questions, including:

  • How far off is the Tribune recipe — a grain or two of salt, or a whole lot more? A merely teeny-tiny variation in the published recipe and the one held in a Yum vault may be a distinction without a difference.
  • How does Yum’s public relations department verify these recurring claims, given how difficult it must be to access the original recipe, said to be on a yellowing piece of paper moved to a more secure location with great fanfare eight years ago? Must Yum CEO Greg Creed personally unearth the company’s version of a launch code to open the vault, then make the comparison himself? Does accessing the vault require two — or more! — executives to combine codes they carry separately? Is Creed followed around by an aide bearing Yum’s own gold codes football?
  • Is it true the promotional KFC-scented suntan lotion released this week can be reverse-engineered to uncover the real recipe’s ingredients?
  • What was really buried in Sanders’s grave in Cave Hill Cemetery after he died at Jewish Hospital in 1980 at age 90? Is that where the recipe is actually stored?!
harland-sanders-grave question mark
Question marks the spot of Sanders’ alleged Louisville grave.

Slime time: In the genteel world of old-money philanthropy, pizza king Schnatter is busting loose

By Jim Hopkins
Boulevard Publisher

When Tom Jurich chases the money John Schnatter gives to charity every year, it’s the ever-prowling cats that pose competition.

No — not those ones. I’m referring to the snow leopard and other big cats at Louisville Zoo, just five miles from Papa John’s Cardinal Stadium, the University of Louisville colossus about to undergo a $55 million renovation that athletics director Jurich wants done in just two years.

Schnatter, 54, loves U of L. He’s donated more than $20 million to the 22,000-student school over the past decade, winning naming rights for his Louisville-based pizza chain for decades to come. (And Schnatter’s a Ball State graduate, to boot.)

Papa John's logoBut he also likes other charities — especially the zoo, according to the most recent IRS tax returns for his John H. Schnatter Family Foundation, which filed its 2015 return only last week. The returns show the foundation gave $111,000 to the zoo in 2012-2015; only one other recipient — U of L — got more, among the dozens of charities Schnatter and his wife Annette support. And that was on top of $1.1 million they donated to the zoo in 2008. To be sure, the zoo was just barely ahead of No. 3 on the foundation’s gift list (keep reading).

The returns offer an inside look at how one of the city’s richest couples — we’re talking $800 million — positions themselves in a pecking order where the right kind of philanthropy is the ticket to top-drawer society. This much is clear: the Schnatters don’t give a flying fig about old-money Louisville. They’re passing on virtually all the usual suspects: the Speed Museum, Actors Theatre, Kentucky Opera, the Fund for the Arts — cultural war horses favored by more established families like the Browns and their 150-year-old whiskey fortune, or the Binghams and their faded media empire from 1918.

Instead, the Schnatters devoted their relatively modest $1.9 million to 86 charities over the four years I examined, focused heavily on helping children and veterans; animal welfare and — crucially, for anxious development officers — advancing John Schnatter’s growing interest in free enterprise and limited government.

But he’s never been old money, anyway.

1980s: bustin’ out

After graduating from Ball State University in 1983, Schnatter started Papa John’s in a broom closet at his father’s tavern, Mike’s Lounge, which he famously saved from ruin with $2,800 he got selling his prized 1972 Camaro. Nearly 32 years and many millions of pies later, he stars in his own TV commercials blanketing the air, proving he’s not above getting dirty to make a sale — literally. In a Sony Pictures marketing tie-in this summer, he played a slimed Ghostbuster pizza delivery guy; that’s a still photo, top of page. (Can you imagine Brown-Forman Chairman George Garvin Brown IV dressed as a dancing mint julep for an Old Forester spot? Neither can I.)

Tom Jurich
Jurich

No matter. Schnatter’s laughing all the way  to the bank. Today, Papa John’s has more than 4,700 restaurants in 38 countries and territories. Its 22,000 employees include 750 in Louisville. And his stake in the $2.8 billion behemoth just soared past $800 million for the first time. That’s a lot of loot that’s arrived relatively fast. On a split-adjusted basis, Papa John’s stock has increased six-fold in the past five years alone. The question over at U of L: How much of that will Jurich wrangle for his $55 million stadium project? Continue reading “Slime time: In the genteel world of old-money philanthropy, pizza king Schnatter is busting loose”

Schnatter unloads another $1.7 million worth of Papa’s shares

It seems Papa John’s founder and CEO John Schnatter can hardly sell shares fast enough. Moments ago, he notified the Securities and Exchange Commission that he’d sold 22,261 shares at $76 each, for a total $1.7 million.

That’s the same per-share price he got Tuesday and Monday, when he sold 11,500 for $873,000 — trades we reported just this morning. And those all followed the 24,322 shares he unloaded the first week of the month, when three other top executives went to market as well, all at prices between $76 and $77 a share.

John Schnatter
Schnatter

Insider sales like these are always noteworthy because they could mean the top brass thinks share prices have plateaued, or are headed lower. On the other hand, such trades could simply involve selling to raise cash or diversify investment portfolios.

Whatever the case, Papa John’s PZZA closed today at $75.34 a share That’s well below the record $78.09 trading high on Aug. 3. And as we pointed out this morning, Schnatter, 54, still holds the single-biggest stake in the company he launched in 1984: 10 million shares worth $753 million. With options, the figure rises to nearly $800 million.

Gaining on Clinton among Ky. donors, Trump raised $360K last month

Trump and Clinton
Trump bests Clinton.

GOP White House nominee Donald Trump’s take last month was more than 2½ times that of the $136,926 received by Democratic candidate Hillary Clinton, according to new data from the Federal Election Commission cited today by WFPL.

“Despite Trump’s summer surge,” the station says, “he still trails far behind Clinton in netting Kentucky’s dollars. Clinton raised more than $921,409 through the end of July, compared to Trump’s $545,940.”

In Lee and Joan Thomas’ philanthropy, five-star giving without the five-star perks

By Jim Hopkins
Boulevard Publisher

A lot of big philanthropy comes with nice extras: private lunches hosted by ballet company directors; season tickets to the opera with box seats, and trusteeships that offer peerless networking with other A-listers. There’s nothing wrong with that; if you gotta keep the lights on and pay the heating bill, it sometimes takes a carrot or two to attract donors who wear a carat or three.

Image
Thomas

But there are plenty of other worthwhile charities that don’t offer the same social cachet — which leads me to Louisville’s Center for Women and Families, and the late Lee Thomas Jr., the retired businessman and philanthropist who died Tuesday at 90.

The center provides crucial support to victims of domestic violence and sexual assault. It runs a crisis hotline; two emergency shelters, and gives psychological and academic help for kids swept up in all that horror. I have Thomas and his wife Joan in mind because they gave the center $2.6 million last year, the bulk of the nearly $4 million their charitable foundation donated to 32 charities. That’s according to the Joan and Lee Thomas Foundation’s public annual IRS tax return for the year ended June 30, 2015; I leafed through it this morning.

To be sure, other generous Louisvillians give to the center, too. But what’s striking about the Thomas’ giving is the sheer concentration on charities that offer few of the five-star social extras. (KET tote bags don’t count.) This was workaday philanthropy to the Home of the Innocents, the Urban League, Planned Parenthood and other important but hardly glamorous causes; here’s a spreadsheet with all their 2015 donations.

The couple’s humility extended to their foundation’s official name, too, which barely identifies them: It’s simply called the J & L Foundation on charity tracker GuideStar.

Much more to come

Their contributions will no doubt continue; the foundation has a $19.5 million portfolio, enough to throw off nearly $1 million in annual contributions well into the future. Last year’s donations brought to $6.3 million the total given in 2013-2015 alone. It ranks in the top tier of Louisville’s biggest foundations and other non-profits based on asset size.

Vermont American logoThe Thomas’ focus on plain philanthropy is hardly surprising, because it reflects their Quaker faith; several of their other donations last year were to charities associated with the Friends General Conference.

Lee and Joan met at a Quaker work camp in 1948, The Courier-Journal says in his obituary. After marrying and moving to Louisville, in 1954 he started building up the former American Saw and Tool Co. — later called Vermont American Corp. — from a single-product supplier to Sears Roebuck & Co. into an international public corporation employing 5,000 people. It’s now a brand in the Robert Bosch Tool Co.

The Thomas’ were instrumental in establishing the ACLU’s Kentucky chapter in 1955, when local civil rights activists were defending a couple, Carl and Anne Braden, accused of being treacherous union sympathizers who fought racial segregation in housing. Lee Thomas also marched with the Rev. Martha Luther King Jr. in the city.

The ACLU mourned his death. “He put up the seed money to get our affiliate off the ground and continued to support our work for the next 61 years,” the chapter said on its Facebook page. “He was a giant for peace, justice, and equality for all. He will be missed, but his example will continue to inspire.”


Disclosure: I’m a card-carrying ACLU member and Planned Parenthood supporter.

Schnatter trims holdings by another $873K, new SEC filing shows; mourners recall pregnant Calif. Taco Bell employee killed in crash; and UPS to launch expansion

A news summary, focused on 10 big employers; updated 5:12 p.m.

PAPA JOHN’S founder and CEO John Schnatter sold 11,500 shares this week at $76 each for a total $873,000, according to a new Securities and Exchange Commission filing yesterday.

To put Schnatter’s $873,000 profit in perspective, consider this: His pizza chain is running a help-wanted Craigslist ad in the Louisville area right now for delivery drivers, promising as much as $20 an hour, with tips. At that rate, a driver would need to work 40 hours a week, 52 weeks a year, for 21 years to make what Schattner, 54, earned with a few keyboard strokes this week.

And he still owns a lot more stock. The trades were made Monday and Tuesday, and left him with a still-huge stake: 10 million shares worth $758 million at yesterday’s closing PZZA price of $75.80. With options, the figure rises another $40 million.

HUMANA declared a regular quarterly dividend of 29 cents a share payable on Oct. 28 to stockholders of record Oct.13 (press release).

Dulce Capetillo
Capetillo

TACO BELL: In San Jose, Calif., last night dozens of mourners remembered Dulce Capetillo, the pregnant 18-year-old Taco Bell employee killed in a car crash last week on the way to picking up her husband, who worked for the fast-food chain during the late shift at another outlet. Doctors saved their infant son, Christopher; he’s now eating from a bottle and no longer tethered to medical equipment. By yesterday, nearly $17,000 had been raised to cover Capetillo’s funeral costs and Christopher’s medical bills, with Taco Bell contributing toward the total (Mercury News). In Louisville, the fast-Mexican chain delivered free lunch yesterday to Louisville Metro Police headquarters as it made amends for an embarrassing incident last week, where employees at a Taco Bell on Preston Highway near Phillips Lane initially balked at serving five LMPD officers (WDRB).

UPS will hold a ceremonial groundbreaking for its previously announced $310 million expansion of the company’s giant shipping hub at Louisville International Airport; the project is expected to add 300 jobs over the next 18 months to the 22,000 already there (Courier-Journal). UPS is the city’s single-biggest private employer; more about the shipper’s local operations.

BROWN-FORMAN turned to automation in an expansion of its Jack Daniel’s distillery operations in Lynchburg, Tenn., according to a new and very wonky account in a trade publication (Automation World).