Monday Business Briefing: Thorntons eyes Original Highlands site; investor buys 10% Papa John’s stake; city holds 9th St. underpass meeting; and more
Welcome to the Nov. 14 Monday Business Briefing, your private business intelligence digest from Insider Louisville.
Neighbors unhappy with Thorntons designs for gasoline station at former Bader’s site
Louisville-based gasoline and convenience chain company Thorntons plans to revive a former gasoline station site at the corner of Baxter Avenue and Broadway.
The company informed residents near 1248 E. Broadway that it plans to build a gas station and convenience market at that site, which was formerly a Bader’s Food Market. The property has sat vacant for several years.
Thorntons has not yet filed plans with Louisville-Jefferson County Metro Government for the project, so Insider Louisville reached out to find out more details, including the size of the building, whether the design would vary from a traditional Thorntons, and the estimated project cost and timeline.
In response, Thorntons’ content marketing coordinator Ashley Smith emailed the following statement: “Because this store is still under development, we do not wish to comment at this time. Once the store has opened, we would be more than happy to speak with you and provide answers to your questions.”
Thorntons plans to host a neighborhood meeting regarding the development at 7:30 p.m. Wednesday, at the Highlands Community Campus, 1228 E. Breckinridge St.
Although Thorntons declined provide additional design details to IL, a representative with the company has sat down with members of the Original Highlands Neighborhood Association.
Matt Blair, president of the association, said he and his fellow members are unhappy with the design Thorntons put forth and have met with a Thorntons representatives to no avail.
The layout, according to Blair, is a traditional Thorntons design with pumps in the front and convenience store toward the back of the property, leaving a huge bright void between the street and the store. The plans also would require the company to tear down a house next to the property at 1240 E. Broadway and a brick building behind the existing vacant convenience store.
However, Blair said, current design standards for the property would require that the convenience store building abut the sidewalk, with the gas pumps placed to the rear. “When it comes down to it, we are very disappointed, especially dealing with a local company,” he said. “They just had a total disregard for” the design standards.
The association would like to see a design that fits the design standards for the neighborhood and also adds to its character.
“We would like to see instead of their normal Thorntons building look, we would like to see something that plays off the 1930-40s Standard Oil gas station look,” Blair said, “something a little more pleasing to the eye.”
Peter Bivens, a local architect and member of the association’s board, drew up a basic design that shows “it could be done,” Blair said, adding that he and the association believe the design gives Thorntons more customer capacity without tearing down the existing home and brick building.
Also, Thorntons doesn’t need to display all its gas pumps out front for people to know what the building is, Blair argued.
Investor buys 10 percent ownership in Papa John’s International
Publicly traded companies must disclose shareholders with 5 percent or more ownership. Fidelity recently took a 10.45 percent ownership stake in Papa John’s, according to a filing with the U.S. Securities and Exchange Commission. Fidelity now owns 3,865,896 common stock in the company.
Papa John’s, along with other Louisville restaurants, have bucked national restaurant trends. While the industry overall is reporting declining sales during the past eight months, Papa John’s this month reported a double-digit jump in net income during the third quarter of 2016.
Net income rose 19.5 percent, to $21.5 million compared with the same quarter a year ago, and third quarter revenue increased 8.5 percent, to $422.4 million. The company’s same-store sales increased 5.5 percent at North American stores open at least a year and 7.6 percent internationally during the third quarter.
Papa John’s executives have credited partnerships with the NFL and MLB, as well as the introduction of its new pan pizza offering, for making the chain successful. —Caitlin Bowling
Report tells a tale of woe for restaurant industry
Speaking of restaurants, a report recently released by Dallas-based Black Box Intelligence paints a dim picture for the restaurant industry, or at least for chain restaurants.
Since June, same-store sales and traffic at thousands of chain restaurants has continually declined, according to the report, which took into consideration nearly 26,000 restaurant units and more than 130 brands. This year has been the worst year for chain restaurants since the end of the recession, according to an exclusive report by Nation’s Restaurant News.
Same-store sales growth fell 0.9 percent in October, and same-store sales have declined or remained flat the prior seven months.
The traffic numbers are even worse. Restaurant traffic at chains has decreased each month for the past year, most recently reporting a 3.4-percent decline in October 2016.
On a positive note, the average check at the restaurants rose 2.5 percent in October, and quick service, upscale casual and fine dining concepts are still performing strongly, Nation’s Restaurant News reported. Restaurant employees also are seeing higher wages as a result of the tightened labor market.
Louisville-based Papa John’s International, Texas Roadhouse and Yum Brands are all among the national food chains that haven’t fallen victim to slumping sales. (Papa John’s recent sales are detailed above.)
Texas Roadhouse executives stated a week ago that its same-store sales in October were up 3.8 percent and traffic had risen 2.5 percent and in the past has reported similar increases.
While the numbers for Yum Brands weren’t as good as Papa John’s or Texas Roadhouse, it still reported a 1 percent increase in same-store sales overall during the third quarter of 2016. Its system-wide sale rose 4 percent for the quarter. —Caitlin Bowling
City to hold meetings about how to improve Ninth Street underpass
After scraping any idea of tearing down the Ninth Street ramp that divides West Louisville from downtown, Louisville-Jefferson City Metro Government is seeking input on how it should enhance the underpass.
The city wants to make changes to transform the underpass into “an engaging and attractive public space,” according to a news release.
Officials with Develop Louisville’s Office of Advanced Planning are hosting a meeting at 6 p.m. Nov. 17 at Peerless Distilling Company, at 120 N. 10th St., to gather public input. Representatives from Interface Studio Architects, Shine Contracting, Core Design, Element Design and LAM Partners also will be in attendance and are part of the project’s design team.
The underpass currently has parking and a TRIMARC facility. The new design will include public art, new lighting and improved pedestrian connectivity, the release stated. The improvements will be made and unveiled this coming summer.
For more information (or if you cannot attend the meeting), more information is at https://louisvilleky.gov/
Bearno’s Pizza hosting fundraiser for family of killed LMPD officer
Since the death of Louisville Metro Police Department Detective Jason Schweitzer, people have come out to support his family.
Two weeks ago, Insider Louisville reported about a GoFundMe page that had been set up to raise money for his family, including his wife, Jessica, and two children. As of Friday, the page had raised $51,705 toward its $100,000 goal.
Tomorrow, local pizza chain Bearno’s Pizza plans to host its own fund-raiser called “Slices for the Schweitzers.”
All Bearno’s locations in Louisville and Southern Indiana will donate 20 percent of all its sales to the Jason Schweitzer Memorial Fund. In an announcement, the restaurant company noted that one of Schweitzers’ favorite bands Strumbeat will play at Bearno’s By-the-Bridge on Main Street downtown from 6 to 9 p.m. —Caitlin Bowling
CafePress records $3.4M third-quarter loss
Shares of CafePress fell Friday after the Louisville-based novelty printing company reported that $1 million in restructuring charges contributed to a $3.4 million third-quarter loss.
Revenue, at $19.2 million, was down 1.6 percent from the third quarter of last year.
CEO Fred Durham said in an earnings release that the company’s third-quarter orders increased 9 percent compared to a year earlier and reached the highest volume in a nonpeak quarter since 2014.
Gross profit, at nearly $8 million, fell by less than 1 percent, and total operating expenses rose by nearly 12 percent. While most operating expense categories — sales and marketing, technology and development, general and administrative — rose modestly, restructuring costs, at $1 million were up significantly from the $4,000 of restructuring costs the company reported in the third quarter of last year.
The net loss, at $3.4 million, was $1.4 million worse than a year earlier.
“Looking forward, we believe CafePress will continue to deliver steady improvements as we focus on growth channels and optimizing the customer experience,” Durham said.
The company moved into a new world headquarters in Louisville in July. Forbes reported last week that Ohio State University has filed a lawsuit against CafePress for using the school’s registered trademarks in its products.
Most local stocks rose in days after Trump election
Most stocks of local importance posted significant gains last week after Donald Trump was elected president, with PharMerica surging 16 percent in the last three days.
Ten companies, either based in Louisville or with regional ties, posted higher gains than the S.&P. 500 in the last three days. Only four companies of local interest fared worse than the index.
PharMerica shares spiked after the pharmacy services company posted third-quarter earnings and issued a positive outlook for the fourth quarter and next year.
Republic Bancorp has jumped 12.2 percent since Tuesday’s close, and Sypris Solutions, Papa John’s, Aetna, Ford and Humana recorded gains between 5 and 8 percent. Though Kindred Healthcare rose 6.5 percent in the last three days, shares of the Louisville-based hospital and rehab center operator have fallen more than 25 percent since Monday, when the company posted a third-quarter loss of $685 million.
Churchill Downs in the last three days climbed 3.42 percent, while UPS delivered an improvement of 1.96 percent. The Dow gained just below 3 percent, while the S.&P. rose just more than 1 percent.
Shares of CafePress have fallen 1 percent since Trump was elected, based in part on the company posting a disappointing $3.4 million third-quarter loss on Friday. Shares of Yum Brands declined 2.1 percent, while Brown-Forman’s fell 3.61 percent.
Shares of Amazon have fallen 6.2 percent since Trump’s election, possibly because of the president-elect’s public disputes with CEO Jeff Bezos, who also owns The Washington Post. However, an analyst with Cowen and Co. told CNBC that the fundamentals of Amazon’s business, including projected e-commerce growth, remain strong—Boris Ladwig
Hospital in south Louisville unveils upgraded ER
Sts. Mary & Elizabeth Hospital has unveiled a $9 million renovation and expansion of its emergency department.
KentuckyOne Health, which owns the facility, said in a press release that the investments more than double the department’s size, will bring new technology to patients’ beds and will reduce wait times.
The organization said that the expansion was funded by the Jewish Hospital & St. Mary’s Foundation, which is supported by donations.
The hospital, at 1850 Bluegrass Ave., serves people in south Louisville and is “one of the busiest” in the city, according to KentuckyOne. One in three people admitted to the hospital come through the ER, compared to a national average of 50 percent. —Boris Ladwig
UofL Alumni inducted into Entrepreneur Circle of Fame
The University of Louisville’s College of Business welcomed two alumni into its Entrepreneur Circle of Fame on Friday.
Diane Medley, co-founder and managing partner of MCM CPA & Advisors, graduated from the College of Business in 1980, with a bachelor of arts in accounting. She has worked in accounting for more than 30 years. MCM (aka Mountjoy Chilton Medley) is the largest CPA firm in the region.
W. Earl Reed was in the accounting class of 1973, and he has spent his career in health care. Reed is the founder and chairman of Springstone, which operates a network of hospitals for mental health and substance abuse patients. Springstone has hospitals in underserved communities across the United States, and according to its website they are “community centered and locally managed.” Reed also founded The Allegro Group, which provides health care financial and operating advisory services.
Their names will be added to a granite monument located in Jane Goldstein Plaza just outside Harry Frazier Hall at the college. —Melissa Chipman