Finance & Capital Management

In a strategic move to bolster its logistics network, Amazon will build an air cargo hub in Kentucky.   The online retailer agreed to a 50-year lease for approximately 900 acres of property from Cincinnati/Northern Kentucky International Airport. The project site, which rivals the size of global hubs of top cargo airlines — is estimated to cost $1.49 billion, ReCode said.  

In addition to disappointing fourth quarter sales, Under Armour announced that its CFO is stepping down.   The company reported that CFO Chip Molloy is leaving the company “due to personal reasons,” and David Bergman, Under Armour’s senior VP, corporate finance, will serve as acting CFO. Molloy will remain with the company in an advisory capacity to assist with the transition, the brand said.  

In addition to reporting a strong quarter of earnings and store openings, H&M is slowing down its store growth and instead, bolstering its digital operations.   The company, which aimed to open 10% to 15% more physical stores each year, reported Tuesday, Jan. 31, is shifting its focus to increasing its omnichannel sales — including both stores and online sales — by 10% to 15% per year, according to H&M.  

Despite a volatile global retail environment, Coach increased sales and profits for its fiscal second quarter.   The luxury handbag and accessories retailer reported revenue of $1.32 billion for the quarter ended December 31, 2016, up 4% from $1.27 billion last year. The retailer’s net income was $200 million, up from $170 million in 2015.  

The labor market for workers appears to be improving.   Walmart confirmed to media outlets it will speed up the time it takes for new employees to complete a training program and subsequently increase their pay.   The retail two years ago implemented a $9 per-hour minimum wage and last year unveiled a six-month training program called Pathways. Once this program was completed, pay was increased to $10 per hour.  

Despite a profitable second quarter, 1-800-Flowers.com fell short of expectations.   The company reported a 1.1% revenue growth to $554.6 million for the quarter ending Jan. 1, from $548.4 million the previous year. The company credited its 1-800-Flowers.com and BloomNet segments for the increase, along with modest growth in its Gourmet Food and Gift Baskets segment, and e-commerce growth across the Harry & David, Cheryl’s, The Popcorn Factory and 1-800-Baskets brands, the company said.  

An Evercore ISI analyst maintained his “buy” rating on Walgreens Boots Alliance stock, stating that although its proposed deadline for a deal with Rite Aid has been delayed, “there is still a chance of a reasonable outcome for both parties.”   The companies pushed back the deadline for merger from Jan. 27 to July 31 and trimmed the purchase price paid to Rite Aid to $6.50 to $7 per share — based upon the number of store divestitures the FTC requires — from $9 per share.  

On a wind farm near McAllen, Texas, with windmills that stand taller from tip to base than the Statue of Liberty, Home Depot is harvesting enough electricity to power 100 Home Depot stores.   The juice is flowing because of the Atlanta-based retailer’s deal with EDP Renewables North America, a deal that marks Home Depot’s first major investment in a wind-powered renewable energy project. The company says that in addition to supplying power to 100 stores, the deal provides $150,000 in local community benefits.  

Fred’s Pharmacy confirmed its agreement to purchase divested stores remains in effect following Monday’s news that Walgreens Boots Alliance and Rite Aid extended the deadline for their potential merger agreement.  

Alan Young has been named senior VP of Property Management in Minnesota by Mid-America Real Estate. He joined the company’s third-party management operation in 2011.   Young spent nearly six years at GGP earlier in his career, managing a portfolio of 10 regional shopping centers generating more than $100 million in net income. He rose to VP and group director at the company before joining Mid-America as a senior property manager.   Young was named a partner in Mid-America last year.

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