Tag: Brexit

Royal ties that bind: Brown-Forman’s Barzun-Bingham connection shined bright in the Brexit shocker

By Jim Hopkins
Boulevard Publisher

The spirits giant Brown-Forman depends on the U.K. for 10% of its annual sales, and the rest of Europe for another 21% — making Britain’s surprise vote to quit the E.U. especially meaningful last month. Brexit also recalled Brown-Forman’s familial ties to the Kingdom through the techie U.S. ambassador Matthew Barzun.

“Well, it’s been a big day,” he Tweeted the day after the June 23 referendum, “and as @POTUS says, our unmatched & unbreakable #SpecialRelationship will endure.”

Barzun, 45, a part-year Louisville resident, is a former technology entrepreneur from the Internet’s early days, becoming only the fourth employee of CNET Networks in 1993. He worked there until 2004 in roles including chief strategy officer and executive vice president, according to his State Department biography.

Barzun has been married to Brown-Forman heiress Brooke Brown Barzun since 1999. Her father was the late Brown-Forman CEO Owsley Brown II, and her mother is Owsley’s widow, the philanthropist Christy Brown.

A fifth-generation Brown

The company is one of Louisville’s most storied businesses. It was founded by Brooke’s great-great grandfather George Garvin Brown in 1870. The distiller employs 1,300 workers in the city and another 3,300 worldwide, where the company distributes Jack Daniel’s, Finlandia vodka and other marquee brands in about 160 countries. Tomorrow, shareholders will hold their annual meeting at the Dixie Highway headquarters; three board members up for re-election also are fifth-generation members of the family controlling the nearly 150-year-old distiller.

The Barzuns’ rarefied social and political connections were on full display in November 2013, when the couple rode in a gilded, horse-drawn carriage to Buckingham Palace to present his credentials to Queen Elizabeth II; photo, top, and in this video:

The Barzuns also entertained the Prince of Wales and Duchess of Cornwall during a reception last year at the ambassador’s official Winfield House residence in London, shortly before the royals visited Louisville at Christy Brown’s invitation:

Barzuns and Prince of Wales
Prince Charles, the Duchess of Cornwall, and Matthew and Brooke Barzun.

President Obama handed Continue reading “Royal ties that bind: Brown-Forman’s Barzun-Bingham connection shined bright in the Brexit shocker”

Ford U.S. year-to-date sales jump 5%, best in a decade

Good news out today for the automaker’s Louisville factories, which employ nearly 10,000 workers.

Ford said total U.S. sales grew 5% during the year’s first six months, with 1,353,048 vehicles sold — its best first-half performance since 2006. June sales were up 6%, with 240,109 vehicles sold, the automaker said in a press release this morning.

Ford logoTruck sales were the standout. The company sold 531,500 pickups and vans, a 13% gain vs. a year ago. Truck sales were up 24% last month, driven by strong F-Series sales of 70,937 vehicles: a 29% increase from a year ago, and their best June sales in more than a decade.

Ford’s stock, battered over the past week in the Brexit-fallout, rose 1.6% in mid-afternoon trading to $12.76 a share, on a day when U.S. stocks overall were marginally higher. Even so, Ford is down 4.7% from pre-Brexit levels.

The Kentucky Truck Factory employs about 5,100 workers, producing F-250 and F-550 Super Duty pickups, plus Expeditions, and Lincoln Navigators. The Auto Assembly Factory employs 4,700 producing  Escapes and Lincoln MKCs. More about Ford’s Louisville operations.

Louisville employer stocks jump again, as post-Brexit investor confidence rises; the Dow soars 285 points; and Walmart hits Amazon with free-shipping trial

A news summary, focused on 10 big employers; updated 6:18 p.m.

Brexit umbrealla
Clouds are parting.

Those employers’ shares closed higher today, as overall U.S. stocks clawed back half the ground lost after Britain’s surprise vote Thursday to quit the European Union. It was the second rally in two days on Wall Street, which had been rattled since Friday by uncertainty over the so-called Brexit. Britain’s stock market also has recouped losses in the same stretch, although other major markets in Europe and Asia have yet to bounce back fully, according to The Associated Press.

The three major U.S. stock indices all closed higher. The Dow Jones Industrial Average rocketed 285 points, or 1.6%; the S&P 500, 35 points or 1.7%, and the Nasdaq, 87 points or 1.9%, according to Google Finance.

Here are today’s closing prices for the 10 employers tracked by Boulevard:

In non-Brexit news:

AMAZON: Walmart today launched a free 30-day trial of ShippingPass, its two-day shipping program to all U.S. consumers, as the world’s biggest retailer ratchets up the competition with Amazon’s Prime subscription service. ShippingPass costs $49 a year, half as much as Amazon’s $99 (Reuters and press release). Also today, Amazon slashed prices up to 50% on newly released, full-featured, unlocked Android smartphones for Prime members (company website). Amazon employs 6,000 workers in the Louisville area, at distribution centers in Jeffersonville, and in Bullitt County’s Shepherdsville.

KINDRED: Senior Vice President John Lucchese sold 4,341 shares for about $11.39 a share today for a total $49,000, the company said in a Form 4 regulatory filing (SEC document). Kindred shares closed this afternoon at $11.43, up 5%.

GE: U.S. regulators rescinded stricter oversight of the company’s finance arm, GE Capital, after saying the conglomerate had made changes that significantly reduced its threat to U.S. financial stability (Wall Street Journal). Its former residential home appliance business, now owned by Haier Group, employs 6,000 workers in Louisville.

John Yarmuth
Yarmuth

In other news, U.S. Rep. John Yarmuth of Louisville has once more donated his entire congressional salary — $174,000 — to charity, making good on a campaign promise when he was first elected a decade ago. The 17 recipients include three arts and humanities groups: Louisville’s Fund for the Arts, Louisville Orchestra, and the Muhammad Ali Center (WDRB).

Louisville companies snap two-day losing streak, as Dow Jones soars 269 points; and Yum China bidders reportedly bust deadline, balk at $10B valuation

A news summary, focused on 10 big employers; updated 4:16 p.m.

Those 10 companies tracked by Boulevard joined U.S. stocks clawing their way back from two consecutive days of steep losses, following Britain’s stunning vote last week to quit the European Union. The Dow Jones Industrial Average closed moments ago at 17,410 — up 1.6%; the broader S&P 500 index jumped 1.8% to 2,036 points, and the Nasdaq climbed 2.1% to 4692.

June 28 Guardian
Today’s Guardian.

“This is going to take a long time to play out and I think the initial shock is being a little reversed right now,” Doug Cote, chief market strategist at Voya Investment Management told CNBC. “This is not 2008. It’s more like 2011.” (Read the latest Brexit developments in Britain’s Guardian.)

In Louisville, virtually all of Boulevard’s top 10 rose by the time markets closed at 4 p.m. They included Kindred, which got pounded yesterday, falling 7%. The closing prices:

Those gains came even as Ford said it expects the double-whammy of any softer post-Brexit industry and a weaker British sterling “would have an adverse impact on our operations in the long term,” a Ford spokesman told financial news site The Street. Ford also said it would issue revised 2016 guidance during its second-quarter earnings call July 28 (The Street). Ford shares have now tumbled nearly 8% since Britain’s surprise vote to leave the European Union — nearly twice as much as the broader S&P 500 index.

In its most recent annual report, in February, Ford warned about the impact of a possible Brexit, saying it “could cause financial and capital markets within and outside Europe to constrict, thereby negatively impacting our ability to finance our business, and also could cause a substantial dip in consumer confidence and spending that could negatively impact sales of vehicles.”

Last year, the U.K. was Ford’s single-biggest market after the U.S., accounting for 8% of the automaker’s $149.6 billion in sales:

Ford sales graphic

Ford employs nearly 10,000 workers at an auto assembly and a truck factory in Louisville.

In non-Brexit business news: At YUM, potential bidders for the fast-food giant’s mammoth China division  Continue reading “Louisville companies snap two-day losing streak, as Dow Jones soars 269 points; and Yum China bidders reportedly bust deadline, balk at $10B valuation”

Louisville companies slammed again in Brexit fallout; Kindred falls 7% more, as Dow Jones plunges another 261 points

A news summary, focused on 10 big employers; updated 4:42 p.m.

Kindred headquarters
Kindred’s headquarters at 4th and Broadway; its shares got hit today.

The 10 big louisville employers tracked by Boulevard took it on the chin again, tumbling for a second consecutive day in the aftermath of Britain’s surprise vote to leave the European Union. Only one — Qingdao Haier, new owner of GE Appliances — gained ground, as major stock market indices fell hard. The Dow Jones Industrial Average closed at 17,140, down 1.5%; the broader S&P 500 index ended the day at 2001, off 1.8%, and the Nasdaq slipped below 4,600, or 2.4%.

Some of the losses didn’t make sense. Hospital and nursing home giant Kindred, with no discernible exposure to overseas turmoil, dove another 7%, to $10.49 a share — even steeper than its 3.9% drop on Friday. Volume was light: 767,818 shares vs. the average 837,761, suggesting little conviction among pessimistic investors; 1.1 million shares traded Friday. Still, Kindred was easily the worst performer of the 10 today:

June 27 stocks

Papa John’s, on the other hand, fell just 1%, to $65.82, after also declining 1% Friday. That’s despite the fact its biggest foreign market is the U.K., where it has 384 company-owned and franchised stores — 26% of all 1,505 outside the U.S., according to its annual report. In total, Papa John’s had 4,893 stores at the end of last year. The company’s top 10 foreign markets . . .

Top 10 Papa John's market outside U.S

. . . and the full list of all 37 overseas.

Today’s action came after Friday, the first day Wall Street could react to Brexit. The Dow plunged 3.4% to close at 17,400; the S&P fell 3.6% to 2,037, and the Nasdaq fell the most, 4.1% to 4,708. Here’s the latest news about Brexit, finance, and business.

In non-Brexit news, Papa John’s will donate 250 pizzas a day through Thursday to victims of recent devastating floods in the Elkview and Clendenin areas of West Virginia (WSAZ). At least 25 people are dead and several more missing after the disaster caused by heavy rains Thursday. Latest flood news.

Meanwhile, visits to fast-food restaurants — which had been growing at a quarterly clip of 2% since September 2015 — stalled in March, April and May, according to as-yet-unpublished data from market research firm NPD Group (The Wall Street Journal).

DOW PLUNGES 589 POINTS IN GLOBAL ROUT, AS INVESTORS REEL FROM BREXIT VOTE; FORD DIVES 7%; YUM, OTHER LOUISVILLE STOCKS SLAMMED

A news summary, focused on 10 big employers; updated 5:21 p.m.

Traders at exchange
Anxious traders at the New York Stock Exchange today (New York Times).

The Dow Jones Industrial Average cratered 3.3% this afternoon, tumbling 589 points and wiping out its year-to-date gains as fears gripped markets with Britain’s stunning vote to  leave the E.U. The broader S&P 500 tumbled 3% and the Nasdaq slumped 3.8%. Latest news.

All 10 big-employer stocks tracked by Boulevard fell sharply:

To fully appreciate the magnitude of the losses, consider Kentucky’s richest family, the Browns of Brown-Forman. They saw $201 million of their more than $6 billion in paper wealth evaporate in a matter of hours.

WSJ-1
This morning’s paper.

The impact of last night’s stunning Brexit news for Louisville employers will be greatest for those with extensive overseas footprints and currency exposure.

They include Brown-Forman, which sells 15 brands such as Jack Daniel’s in 160 countries worldwide. The U.K. is the company’s second-biggest market, accounting for 10% of fiscal 2016 sales, according to Brown-Forman’s annual report. Europe, excluding the U.K., was 21%. The U.S. is No. 1, with 46%. The company says foreign markets are increasingly important: “In fiscal 2016, we generated 54% of our net sales outside the United States compared to 41% 10 years ago.”

Other companies likely taking post-Brexit hits include Papa John’s, which operates in 39 countries; Yum in 130 countries and now reshaping overseas operations with a planned China spinoff in October; Ford, which is already reworking its European sales strategy, and Amazon, a relative newcomer abroad.

Boulevard’s Stock Portfolio companies routinely warn investors about risks of doing business outside the U.S. Papa John’s, for one, noted in its annual report that “international operations could be negatively impacted by changes in international economic, political, security or health conditions in the countries in which the company or our franchisees operate.”

Yum’s 14,600-unit KFC Division bears the biggest overseas exposure; it’s in 120 countries, with more than a third — 5,003 restaurants — in China.

uk_tg
Britain’s Guardian.

“Our business,” Yum says in its annual report, “is increasingly exposed to risks inherent in international operations. These risks, which can vary substantially by country, include political instability, corruption, social and ethnic unrest, changes in economic conditions .  . .  as well as changes in the laws and policies that govern foreign investment in countries where our restaurants are operated.”

Also, Yum warns, “results of operations and the value of our foreign assets are affected by fluctuations in currency exchange rates, which may adversely affect reported earnings.”

Boulevard’s Big 10 companies employ 63,000 workers in the Louisville area, and nearly 2 million worldwide.

In non-Brexit news; updated 5:38 p.m.: Continue reading “DOW PLUNGES 589 POINTS IN GLOBAL ROUT, AS INVESTORS REEL FROM BREXIT VOTE; FORD DIVES 7%; YUM, OTHER LOUISVILLE STOCKS SLAMMED”