the bottomline
PONTE VEDRA BEACH:
Wells Fargo’s top management and board of directors apologized to investors and faced a series of protesters Tuesday at the first big shareholder meeting since a scandal over sales practices led to an executive shakeup, fines and a dented reputation.
Chairman Stephen Sanger said, “We are deeply sorry,” as he addressed shareholders. And CEO Tim Sloan called it “unacceptable.” That follows apologies already given to customers and employees. Sloan, who got that job in October, has repeatedly talked of making things right with customers.
The bank has changed the way it pays branch employees, reclaimed promised compensation to several executives and apologized to customers after regulators imposed $185 million in fines last September. Authorities said Wells Fargo workers opened up to 2 million accounts without customer permission as employees tried to meet aggressive sales goals.
Whether the changes will be enough — Wells has seen a sharp decline in new customers and remains under investigation by various authorities — is a main issue shareholders are deciding. (AP)
ATLANTA:
Coca-Cola’s sales declined in the first quarter as it restructured its business, and the world’s biggest beverage maker said it will cut 1,200 jobs starting later this year as it deepens its costcutting.
The maker of Fanta, Sprite and Smartwater said the job cuts will come from its corporate staff around the world. That would represent about a 22 percent reduction of its corporate staff of about 5,500, or a 1 percent reduction in its total workforce of 100,300 employees, according to FactSet.
Coca-Cola Co said the cuts would help it find another $800 million in annualized savings, in addition to the $3 billion the company previously said it is trimming. Most those savings are expected to be realized in 2018 and 2019, it said. (AP)
NEW YORK:
McDonald’s reported higher first-quarter earnings Tuesday on better performance in key regions, including the United States and China.
The solid results reflected greater emphasis on boosting traffic in the United States at the home of the “Big Mac,” as well as other markets, such as Japan, where growth was also strong.
“There’s a sense of urgency across the business as we take actions to retain existing customers, regain lapsed customers and convert casual customers to committed customers,” said chief executive Steve Easterbrook.
Net income for the quarter ending March 31 was $1.2 billion, up eight percent from the year-ago period.
Revenues came in at $5.7 billion, down 3.9 percent, reflecting McDonald’s sale of restaurants to franchise companies. (AFP)
LOS ANGELES:
Marissa Mayer is expected to depart Yahoo following the closing of Verizon’s $4.5 billion takeover in June — but she’s going to cash out big time, as she currently owns stock worth more than $200 million.
As of April 3, the Yahoo CEO owned 4.49 million shares of common stock, according to an SEC filing by the internet company Monday. At the most recent closing price of $48.15 per share, that’s worth about $216 million. Mayer’s total holdings includes 2.88 million options and 17,490 shares of restricted stock units exercisable within 60 days of April 3.
Mayer has disclosed plans to exit Yahoo’s board following the sale. However, according to several reports, she is not going to join Verizon under the newly formed Oath division that will merge the AOL and Yahoo brands. Oath will be run by AOL chief Tim Armstrong, and Verizon plans to announce other members of its management team Tuesday, USA Today reported. (AOL and Yahoo declined to comment on the report.) (RTRS)
MONTREAL:
Great-West Life, one of Canada’s largest insurance companies, announced 1,500 job cuts on Tuesday, citing increased competition in the sector.
The layoffs over two years represent 13 percent of the company’s workforce in Canada.
“To ensure we remain competitive and drive future growth, we are reducing costs and becoming more efficient, while at the same time investing more in customer-focused innovations and service offerings,” Great-West Life chief executive Paul Mahon said in a statement.
The company said it needed to become more nimble “in a world where advances in technology and heightened competition are having an increasing influence on customer needs and expectations.” (AFP)
NEW YORK:
JetBlue’s first-quarter profit sank 59 percent from a year ago as fuel costs and other expenses rose and the airline made less revenue from every seat flown.
But the airline’s earnings still beat Wall Street expectations and its shares rose more than 4 percent Tuesday morning.
JetBlue reported net income of $85 million, or 25 cents per share, in the three months ending March 31, compared with $207 million, or 61 cents per share, in the same period a year before.
Its earnings per share just topped Wall Street expectations of 24 cents per share, according to Zacks Investment Research. (AFP)
NEW YORK:
J.Crew, the preppy clothing retailer, said Tuesday that it will cut about 150 jobs to trim costs.
Like other retailers, J.Crew has suffered as more people shop online. The company has lost money for the past three years.
Most of the job cuts will be at its New York corporate headquarters where about 1,000 people work. It will also not fill about 100 corporate positions that were open. The changes will save it about $30 million a year, and the company says it will post a charge of about $10 million in the first quarter due to severance payments and other termination costs. The company has more than 570 J.Crew, Madewell and outlet stores. (AP)
NEW YORK:
Tyson Foods will pay $3.2 billion to add packaged sandwich maker AdvancePierre to its stable of processed food brands.
Tyson will pay $40.25 per share, a 9.8 percent premium to AdvancePierre’s closing share price Monday.
Tyson Foods Inc. will also assume about $1.1 billion in debt from the Blue Ash, Ohio, company.
The deal is expected to close in the third quarter. Tyson is shifting its portfolio to incorporate a heavier emphasis on proteins. On Monday, Tyson said that it might sell its Sara Lee frozen bakery business, its Kettle brand and Van’s. (AP)