Business Insider published its annual “The 37 Richest People In Advertising, Ranked By Income.” Like last year’s list, while the group includes one woman and a handful of guys from Spain, the overwhelming majority of advertising’s top breadwinners are White men. It’s tough to join the financial elite when you’re starting with crumbs. The only Black person who might make the cut is Uncle Ben.
On May 6, Advertising Age reported Procter & Gamble would lengthen the time the advertiser pays its advertising agencies to 75 days. Now the trade publication says Mondelez will extend its payment terms to 120 days. Of course, advertising agency executives are crying foul, whining that the monetary mandates are unfair and even unethical. As if fairness and ethics are embedded in the DNA of a typical adperson. Most BDAs draw out payments to freelancers and vendors too—and the shops will likely stretch things out further in response to the new processes from P&G and Mondelez. Besides, 120 days is less than the blink of an eye compared to how Madison Avenue has taken its sweet time delivering on diversity.
Haunting Relic of History, Slave Cabin Gets a Museum Home in Washington
By Robbie Brown
EDISTO ISLAND, S.C. — The floors creaked. The walls swayed in a strong breeze. Rot and termites had destroyed parts of the rickety structure built before the Civil War.
But when curators from the Smithsonian’s new African-American history museum in Washington visited this marshy island last year, they found exactly what they were looking for: an antebellum slave cabin that captured the stark life of plantation workers before emancipation.
Edisto Island is home to two of the nation’s oldest slave cabins, dating to the 1850s — vestiges of what was once an entire village for field workers at the Point of Pines Plantation. Black families lived in the wood-sided, two-room houses, without electricity or heating, until the 1980s.
Now, the better-preserved of the two cabins is getting a new home in the nation’s capital. The Smithsonian Institution is dismantling it, plank by plank, and moving it to the National Museum of African-American History and Culture, which is scheduled to open on the National Mall in late 2015.
It will be among the featured artifacts, beside Harriet Tubman’s shawl, Nat Turner’s Bible, a Tuskegee Airmen fighter plane and Emmett Till’s coffin. Lonnie Bunch, the museum’s director, called it “a true jewel in the crown of our collection.”
“Slavery is the last great unmentionable in public discourse,” he said. “But this cabin gives an opportunity to come face to face with the reality of slavery. It humanizes slavery.”
For years, local historians had struggled to save the pinewood building. After the last residents moved out, it was added to the National Register of Historic Places in 1986. Three years ago, the plantation’s owners donated the cabin, but not the land, to the Edisto Historical Preservation Society.
The society raised $40,000 to clear away vines and install diagonal beams to stabilize the tilting 16-foot-by-20-foot structure. But it could not find enough money to safely move the cabin to a new location.
“Honestly, we were about to give up,” said Gretchen Smith, the society’s director.
The Smithsonian called just in time. The museum, with a budget of $500 million, had scoured the country for the right cabin. Its curator, Nancy Bercaw, said Edisto Island’s was perfect: it needed a new home, and because blacks had lived in it long after slavery, the museum can display it in an exhibit encompassing the postwar period called “Slavery and Freedom.”
“The sea island history is so rich and multigenerational,” Ms. Bercaw said. “This history has been tucked away. It hasn’t always been safe to pull out these stories.”
Last Monday, work crews from a preservation company called Museum Resources Inc. stripped off parts and labeled them. Modern additions like the tin roof and metal nails will be replaced. The rest will be transported to a restoration facility in Virginia before being rebuilt inside the museum.
The crews made several discoveries while taking apart the cabin. Newspapers had been stuffed inside the walls for insulation. Windows and door frames were painted with a faint blue paint, which historians say slaves from the Caribbean believed kept demons away.
The exact age of the cabin is unknown, although historians believe that it was probably built off-site and assembled at the plantation. Toni Carpenter, the founder of Lowcountry Africana, a group that documents black history in the South, said an 1851 map of the plantation showed the cabin at its present site. And, she said, an 1854 plantation inventory showed that 75 people were enslaved there.
One of the last residents who remembers life inside is Junior Meggett, 80, a retired groundskeeper, who grew up in the 1940s in an identical cabin and whose aunt and uncle owned the one given to the Smithsonian.
Winter nights were so cold that everyone huddled around the stone fireplace on cots, he said. Summers were so mosquito-infested that the fire burned constantly as insect repellent.
“It’s a tough place to live,” he said. “But we didn’t have any choice. It was just where you lived.”
The new museum is the Smithsonian’s first since the National Museum of the American Indian opened in 2004. It will span black history and culture from the African slave trade through the first black presidency.
Ms. Smith, from the historical society, said it was bittersweet to see the cabin leave the island after more than 160 years. She hopes to raise enough money to restore the second cabin and keep it on Edisto. But while South Carolina is losing this artifact, she said, “now millions of others can see it.”
Adweek reported on the growing importance of marketing to Latinos—including displaying a lengthy infographic. Of course, the trade journal’s ex-publisher saw fit to cut Marketing y Medios back in 2006.
Nearly Half of Second-Gen Hispanics Feel Like Ads Don’t Target Them
Ethnicity influences brand decisions
By Lucia Moses
By now, it’s obvious that targeting Hispanics in the U.S. means more than just translating an ad into Spanish and casting ethnic stereotypes as spokespeople. For one thing, the first and second generations differ in their acculturation levels, which affects their content and advertising preferences, according to a report from Yahoo/Mindshare, Ethnicity in the Digital Age: Marketing to Hispanics. First-gen Hispanics are much more likely than the second and third gen to look for news content that speaks to their ethnicity and try brands that target them ethnically. But Hispanics of all generations care a great deal about whether the news media puts their ethnic group in a good or bad light and uses obvious stereotypes in ads.
A Black Nurse, a German Soldier and an Unlikely WWII Romance
By Alexis Clark
The nurse and the soldier may never have met – and eventually married – had it not been for the American government’s mistreatment of black women during World War II.
Elinor Elizabeth Powell was an African-American military nurse. Frederick Albert was a German prisoner of war. Their paths crossed in Arizona in 1944. It was a time when the Army was resisting enlisting black nurses and the relatively small number allowed entry tended to be assigned to the least desirable duties.
“They decided they were going to use African-Americans but in very small numbers and in segregated locations,” said Charissa Threat, a history professor at Northeastern University who teaches race and gender studies.
Ms. Powell was born in 1921 in Milton, Mass., and in, 1944, after completing basic training at Fort Huachuca, Ariz., she was sent, as some other black nurses were, to tend to German prisoners of war in Florence, Ariz.
“I know the story of how they met,” said Chris Albert, 59, the youngest son of Elinor and Frederick Albert. “It was in the officers’ mess hall, and my father was working in the kitchen. He kind of boldly made his way straight for my mother and said: ‘You should know my name. I’m the man who’s going to marry you.’”
Frederick Karl Albert was born in 1925 in Oppeln, Germany. “He volunteered for the paratroops to impress his father, who served in WWI,” Mr. Albert said. “His father was an engineer and not really interested in his children. My dad ended up getting captured in Italy.”
He joined many other German prisoners who were detained in camps across the United States. With millions of American men away in combat or basic training, P.O.W.’s became a solution to the labor shortage. “Under the Geneva Convention, enlisted criminals of war could work for the detaining power,” said Matthias Reiss, a professor at the University of Exeter, in England, who has researched the history of German P.O.W.’s. “So the idea was, bring them over to America and let them do the unskilled work.”
In the camp in Arizona, Frederick Albert worked in the kitchen, where he prepared special meals for Elinor. A romance between the two blossomed but not without consequences. “My dad was severely beaten by a group of officers when they found out about my mom,” Mr. Albert said, referring to American soldiers.
At Camp Florence, as well as other camps, the environment for black nurses could be particularly humiliating. The nurses were forced to eat in separate dining halls, apart from white officers on the base.
“My mother mentioned that she was in a bar or some place that had food or drink and they refused to serve her,” said Stephen Albert, 66, Elinor and Frederick’s oldest son.
The discrimination blacks encountered was not lost on the German P.O.W.’s.
“You’d be hard-pressed to find a German soldier who was held captive in America who didn’t speak about African-Americans,” Professor Reiss said. “They were quite aware there was a major discrimination problem and that the Americans weren’t really allowed to occupy the moral high ground on that matter.”
By war’s end, about 500 black nurses had served in World War II. All German P.O.W.’s, including Frederick Albert, were eventually sent to Germany.
The American military officially ended segregation after WWII, but for the Alberts, the issue of race would resurface throughout their lives. Their unlikely romance resulted in Stephen’s birth in December 1946. After Frederick was able to return to the United States, he and Elinor married on June 26, 1947, in Manhattan.
“I would say the first 10 years for my parents were a struggle to find some kind of economic security and a safe haven for an interracial family,” said Chris Albert, who plays the trumpet with the Duke Ellington Orchestra.
“They moved to Boston and my father worked several jobs,’’ he said. “At some point, he decided it was best if they moved to Göttingen, Germany, where his parents lived. He could work for his father’s cement manufacturing business.”
But Kristina Brandner, 70, a niece of Frederick Albert, said life in Germany was difficult. “Göttingen is a small town,’’ she said. “My grandmother never had contact with black people so it was strange and uncomfortable for her with Elinor. Kids used to ask me how come there was a black woman living with us, and why is your cousin another color. Sometimes, I saw Elinor in the kitchen crying.”
In less than two years, Frederick, Elinor, Stephen and Chris, who was an infant, returned to the United States.
“We came back and moved to Morton, Pa. And then they went through the school issue,” Mr. Albert said.
That issue was the rejection of Stephen’s attempt to enroll at a local public school after being told that the school was not open to black children.
“My mother pitched a fit,” Mr. Albert said, who still has a copy of the letter Elinor wrote to the school superintendent and a local branch of the N.A.A.C.P.
In 1959, Mr. and Ms. Albert settled in Village Creek, an interracial neighborhood in Norwalk, Conn., where Elinor became an avid gardener and Frederick became a vice president at Pepperidge Farm.
“We always had great music at home,” said Mr. Albert, who resides in his childhood house in Norwalk. “My dad had this affinity for New Orleans jazz. I think it was a much larger representation for him. That lack of warmth he felt growing up, he found it in jazz and when he saw my mother.”
Mr. Albert’s father died in 2001, and his mother in 2005.
“I now ask myself how come I never questioned my dad about Hitler or what he thought about the Nazi movement,” said Mr. Albert, who will perform along with his band mates at the Blue Note Jazz Club in the West Village this month.
“My mother didn’t talk about it either,’’ he said. “They didn’t bring up the past. But what I do know about my parents, their story is a remarkable one.”
At Business Insider, Jim Edwards continues his ongoing reporting and online scuffling involving GlobalHue and the Bermuda Tourism account. Now the ex-Premier of Bermuda is questioning Edwards via an email exchange with racist references. Additionally, Edwards has been offered an all-expenses-paid trip to extend the debate. Don’t expect any updates to be filed from a Bermuda beach.
TBWA in Brazil created a campaign for GQ—and displayed its low IQ in terms of cultural cluelessness.
Business Insider spotlights a culturally clueless Uni-Ball commercial from TBWA Worldwide in South Africa.
Besides the obligatory Black moving person and background extras, the latest episode of AMC series Mad Men Season 6 featured zero people of color. However, a Bank of America commercial aired during the broadcast, presenting the stereotypical Black music artists.
Not sure about the thinking behind this Fiat campaign via Leo Burnett in Spain.
Miss Universe contestants and whip cream makes sense.
Getting Gizmo wet and feeding him at night makes sense.
But combining a guy with an afro and a guy with shears just seems culturally clueless.
Can never tell if stuff on Ads of the World is legit, but this Mother’s Day message from Febreze stinks.
Supreme Court Saw Only One African-American Lawyer In Last 75 Hours Of Arguments
By Mark Sherman
WASHINGTON—In roughly 75 hours of arguments at the Supreme Court since October, only one African-American lawyer appeared before the justices, and for just over 11 minutes.
The numbers were marginally better for Hispanic lawyers. Four of them argued for a total of 1 hour, 45 minutes.
Women were better represented, accounting for just over 17 percent of the arguments before the justices.
In an era when three women, a Hispanic and an African-American sit on the court and white men constitute a bare majority of the nine justices, the court is more diverse than the lawyers who argue before it.
The arguments that took place from October to April were presented overwhelmingly by white men. Women and minority lawyers whose clients’ cases were heard by the court were far more likely to represent governments or be part of public-interest law firms than in private practice, where paychecks are much larger.
The numbers generally reflect the largely white and male upper reaches of the biggest and richest private law firms, where there have been small gains by women and minorities in the past 20 years. A recent survey by the Association for Legal Career Professionals found that more than 93 percent of partners in law firms are white and nearly 80 percent are men.
The statistics from the court term, though, also reveal a lack of African-American and Hispanic lawyers in the elite Justice Department unit that represents the federal government at the Supreme Court.
The top supervisory positions in the Office of the Solicitor General all are held by men, though there are six women in the office who argued high court cases this term.
The office serves as a pipeline to the big firms that dominate the argument calendar at the court. Lawyers in the office make several arguments a term and acquire the experience and ease of standing before the justices that make them attractive to private firms.
The first woman on the court, Sandra Day O’Connor, touched on the importance of diversity at the court in a tribute to the first African-American justice, Thurgood Marshall. O’Connor said Marshall “imparted not only his legal acumen but also his life experiences, constantly pushing and prodding us to respond not only to the persuasiveness of legal argument but also to the power of moral truth.”
The justices also benefit from seeing lawyers who don’t all look and sound the same, said Alan Jenkins, an African-American former Justice Department lawyer who argued four cases at the Supreme Court. “It’s especially true of people who appear before the Supreme Court because the court, as an institution, is intentionally set apart from the day-to-day life of the nation,” said Jenkins, executive director of the not-for-profit The Opportunity Agenda in New York.
The only minority group that could be said to be overrepresented was lawyers of Asian heritage. Seven men — three in private practice, Deputy Solicitor General Sri Srinivasan and two others at the Justice Department and a lawyer for the American Civil Liberties Union — made 17 arguments to the court. There has never been an Asian-American justice.
In cases before the Supreme Court, there are at least two and sometimes more parties who are granted time to argue their positions. In the current term, the justices heard 193 separate presentations.
When Debo Adegbile stepped to the lectern in defense of a landmark voting rights law in February, he was the first — and as it turned out, the only — African-American to make a high court argument this term.
Adegbile until recently worked for the NAACP Legal Defense and Educational Fund, the famed public-interest law firm that mounted generations of civil rights challenges, including the landmark Brown v. Board of Education case that outlawed official segregation in public schools.
Before he became a justice, Marshall was the organization’s top lawyer and argued several high court cases.
Adegbile represented six African-American residents of Shelby county, Ala., which is challenging a key provision of federal voting rights law. Following Solicitor General Donald B. Verrilli Jr.’s more legalistic presentation, Adegbile pointed to recent examples of intentional voting discrimination in the South to highlight the ongoing need for the measure.
“This statute is in part about our march through history to keep promises that our Constitution says for too long were unmet,” he said.
Voting rights was the second of two high-profile cases about race at the court this term.
In the first, three white men made the arguments when the justices considered the fate of the University of Texas program that takes account of race in admissions.
Civil rights cases have historically given minority lawyers the greatest chance to argue before the court, but those cases have been in decline for some time at the Supreme Court.
“The more problematic question is, why is civil rights litigation one of the few pathways available to African-American litigators when clearly they have distinguished themselves?” Jenkins said.
Women in the legal profession have faced a similar problem, but lately have had more opportunities.
Lisa Blatt of the Arnold and Porter law firm in Washington has written that over the years most women arguing at the court have been public-interest lawyers, public defenders or government attorneys. “Translation: women are doing the same work but for less pay,” she wrote in the Green Bag, a legal journal.
This term, Blatt made three arguments, the only woman in private practice to make more than one. There were 10 men in private practice with multiple arguments.
“This is a problem of today but not tomorrow,” Blatt said, referring to the many women who are gaining experience representing the government at the court. She said some of them will enter private practice, as she did after many years in the Justice Department.
Missed opportunities, or a job well done in Cleveland kidnapping?
By Yamiche Alcindor, USA TODAY
Some argue that the missing girls in Cleveland’s horrifying kidnapping were not aggressively sought, but police strongly deny the claim as unfair
CLEVELAND—Judy Martin recites the names of missing people in Cleveland like a well memorized poem. She knows names, dates, last known whereabouts, and details about dozens of cases dating back to 1997.
Martin, who founded Survivors/Victims of Tragedy, also says she knows how race and economic status play a role in how police treat cases, including those of three women held captive for years here in an impoverished Cleveland neighborhood.
She, along with experts, believe cases involving people of color, low-income residents, and working class victims don’t get the same law enforcement resources as others. Officials from the Cleveland Police Department, however, say they did all they could find Amanda Berry, Gina DeJesus, and Michelle Knight and regularly look into missing persons cases without any biases.
“When it’s somebody of color or someone from in a poorer area, we don’t see to get the response that other areas of the country get,” said Martin whose nonprofit regularly works with families of victims. “It needs to stop. When a person goes missing, it shouldn’t matter whether they’re white, black, hispanic, Asian, purple, green or blue.”
Knight, Berry, and DeJesus were abducted in separate incidents almost a decade ago by Ariel Castro, police said. Castro, who now faces kidnapping and rape charges, kept the three women hostage until Monday when Berry escaped and alerted police.
In the years after Berry and DeJesus went missing, Martin, whose son was murdered in 1994, became an advocate for the women’s families holding rallies and vigils every week and later every year. At each event, she and the families tried to keep the public aware of the cases while Martin says police brushed off the cases as teenagers who just took off.
It’s a claim the police fiercely deny.
Police say they and FBI investigators devoted extraordinary resources, at times fueled by personal anguish, to pursue every lead in the case.
“The Cleveland Police Department doesn’t care someone’s economic or social status,” Police Commander Keith Sulzer said Friday afternoon. “We don’t care what status you’re from, everybody gets the same treatment.”
He’s insulted that somebody would suggest their services would vary based on race or money—especially in the cases of Berry, DeJesus, and Knight.
For a decade, officers searched hundreds of streets, investigated vacant homes, and followed any information they thought might lead to the women, Sulzer said.
Thursday night at a community nearby the Seymour Avenue home of Ariel Castro, where the women were found, Sulzer told residents that more than 2,900 people were missing in the city of Cleveland and that families of those missing need actively work with officers to keep the cases going.
“If you have a missing person, you need to be on us at all times,” he said, adding that if families feel like officers aren’t doing enough they should contact the department.
Still, Martin maintains that police often assume cases involving people of color and lower income victims involve a person walking away without criminal involvement. She wants protocols that would make it mandatory that officers file a report each time someone says their family member or friend is missing regardless of the person’s past, economic status, or race.
A similar question arose in 2009 when the bodies of 11 murdered women were found in the Cleveland home of a serial killer. Anthony Sowell specialized in luring poor, drug addicts into his Imperial Avenue home, raping and strangling them.
During Sowell’s trial, relatives of some of his early victims said police didn’t take missing-person reports seriously, and one victim who survived an attack said police didn’t believe her when she reported the assault. Sowell was released from jail without charges after the woman’s report and went on to kill several others.
Journalist and urban planning specialist Angie Schmitt, co-founder of Rust Wire, blogged last month that although the Cleveland Plain Dealer ran “sympathetic” and extensive profiles of the Sowell victims, the paper “never raises the bigger issue. What made these women such easy targets was being black, being women and being from the highly-segregated and desperately poor east side of Cleveland.
“This is a story about racism and inequality and sexism and poverty as much, if not more, than it is about drugs and individual lives going astray,” Schmitt wrote. “Nobody was going to tear up the city looking for a few black women from the east side with sketchy pasts.”
We’re obsessed when it’s white women in trouble
By Lisa Bloom, Special to CNN
(CNN) -- Our country is obsessed with the perils of attractive young white women, as this week’s trio of high profile crime stories about Amanda Knox, Jodi Arias and the Cleveland kidnapping victims demonstrates. We don’t see breathless coverage of the disproportionately large number of African-American men tried for crimes in our system. We see almost no coverage of missing boys, or missing children of color, or crimes against nonwhites.
This week an African-American man in Mississippi, Willie Manning, was about to be executed, though he was denied access to DNA testing. Manning, convicted of murdering two college students in 1994, maintains his innocence and requested the scientific testing, which has exonerated many convicted murderers, including some on death row.
The Mississippi Supreme Court denied that request and ordered his execution. At the last moment, U.S. Justice Department letters tipped the balance in favor of a reprieve. Few media outlets considered the monumental constitutional issues, or even the dramatic ticking clock toward his execution, worthy of mention.
Isn’t the fact that we still execute Americans without giving them access to DNA testing a stunning, significant story? Yet it got next to no attention.
Instead, in the last week thousands of hours of attention have been devoted to every detail of just three crime stories.
In Phoenix, Arizona, Jodi Arias (whose father is Latino) was convicted Wednesday of first degree murder, after the jury unanimously found that she intentionally and with premeditation killed her former boyfriend, Travis Alexander. The trial was covered live on HLN and followed closely on social media and other television networks. The next phase of the trial is scheduled to begin May 15.
In Cleveland, Ohio, Amanda Berry reportedly screamed for help, a neighbor came to her aid, and she, her 6-year-old daughter, and two women, Gina DeJesus (who is Latina) and Michelle Knight were freed after a decade of captivity. Ariel Castro was charged today with kidnapping and rape.
Amanda Knox, the American college student who was convicted, then acquitted of the murder of her roommate in Italy, has given tearful interviews in connection with her book tour, as an Italian court has reversed again and held that she should stand trial again for the charges.
Each of these cases includes salacious allegations and high-stakes outcomes. The Cleveland victims were reportedly raped and beaten countless times over the years. Amanda Knox is accused of killing her roommate as part of a drug-fueled sex game. Jodi Arias posed nude for photos and had sex with her victim just before she murdered him.
While each of these crime stories is worthy of news coverage—especially the Cleveland story, which involved serious questions of alleged law enforcement lapses—many others are equally worthy yet receive little or no attention, even as every detail of the high-profile stories is pored over and rehashed.
Missing children websites carry pictures of many African-American and Latino kids who have disappeared, and photos of little boys who have vanished. News outlets rarely feature their stories. Their families grieve their absence and yearn for media coverage that could help find their children and energize law enforcement.
And the biggest American crime story of all receives the least mention: that we now incarcerate more of our own people than any other country on earth, or in human history, and that minority males are disproportionately policed, arrested and convicted, and sentenced to harsher sentences. African-American juveniles are six times as likely as whites to be sentenced to prison for identical crimes.
In Washington, three out of every four black men can expect some time behind bars in their lifetimes. In Baltimore and Chicago, the majority of young black men are currently under the control of the criminal justice system. In sheer numbers, more African-Americans are under correctional control today than were enslaved at the time of the Civil War. Our disastrous war on drugs has devastated inner-city communities, and led to large numbers of African-Americans being legally barred from voting, jury duty, public housing, food stamps, student loans, and many other civic rights and benefits, often for life.
We cannot fix these problems if we are unaware of them. We cannot get a groundswell for reform if we are distracted by titillating outlier stories.
The media choose which stories to make high profile, driven by public interest in those stories. We cannot call ourselves a nation of equals until we pay equal attention to all those in our criminal justice system whose stories merit our attention, regardless of their race or gender.
TBWA in Barcelona, Spain, presents “the new wave of soft drinks” with an old idea from TBWA\Chiat\Day.
Daniel Snyder says Redskins will never change name
By Erik Brady, USA TODAY Sports
Daniel Snyder is owner of the Washington pro football team he grew up adoring. Would he ever consider changing the team name that many American Indians and others believe is a racial slur?
“We will never change the name of the team,” Snyder told USA TODAY Sports this week. “As a lifelong Redskins fan, and I think that the Redskins fans understand the great tradition and what it’s all about and what it means, so we feel pretty fortunate to be just working on next season.”
What if his football team loses an ongoing federal trademark lawsuit? Would he consider changing it then?
“We’ll never change the name,” he said. “It’s that simple. NEVER — you can use caps.”
Snyder does not often speak to the media about the case. He talked to USA TODAY Sports very briefly about it Tuesday afternoon, following a longer interview with him and his wife Tanya about her selection as mother of the year by the American Cancer Society.
Later Thursday, USA TODAY Sports will publish a story about Amanda Blackhorse, who is Navajo and the named plaintiff in the trademark suit. She said if she ever had the chance, she’d ask Snyder if he would dare to call her a redskin to her face.
“I think the best way is to just not comment on that type of stuff,” Snyder said. “I don’t know her.”
The Associated Press reported Wendy’s 1Q net income dropped 83 percent versus last year’s figures. Guess the awful advertising featuring the real Wendy and the annoying redhead isn’t doing the trick. Bring back Dave Thomas—zombies and the living dead are really popular these days.
Wendy’s first-quarter net income down 83 percent compared to last year
From The Associated Press
DUBLIN, Ohio — Wendy’s first-quarter net income fell 83 percent from year-ago results that included a big gain on the sale of an investment.
But the fast-food chain operator’s adjusted earnings matched Wall Street’s expectations. Wendy’s also boosted its full-year earnings forecast, citing a refinancing benefit.
Wendy’s has been working to position itself on the high-end of the fast-food sector by emphasizing the relative quality of its menu. The push comes as more people head to chains like Chipotle and Panera, which offer food perceived to be of better quality for slightly more money.
To transform its image, Wendy’s is also investing heavily in remodeling its restaurants to have a modern, inviting look. For example, the new layouts include cozier seating areas, flat screen TVs and fireplaces. The Dublin, Ohio, company said Wednesday that it had opened 86 new and remodeled restaurants as of April 30. It still expects to remodel half of its company-run restaurants by 2015’s end. Wendy’s has more than 6,500 franchise and company-run restaurants in the U.S. and 27 countries and U.S. territories worldwide.
But Wendy’s is undertaking an image makeover at a tough time for the restaurant industry, with competition growing and people being careful about where they spend their money. McDonald’s and Burger King, for example, have been aggressively touting their deals to increase sales.
For the period ended March 31, Wendy’s earned $2.1 million, or a penny per share. That’s down from $12.4 million, or 3 cents per share, a year earlier.
The year-ago period included an $18 million, or 5 cents per share, gain on the sale of an investment.
Excluding certain items, earnings in the latest quarter came to 3 cents per share.
Revenue rose 2 percent to $603.7 million versus a year ago but fell short of the $615 million forecast of analysts polled by FactSet.
Revenue at company-run stores in North America rose 1 percent. The company said its results were impacted by bad weather during the period and shifts in the timing of the New Year and Easter holidays. At franchised stores, the metric edged up 0.6 percent.
This figure is a key gauge of a restaurant operator’s performance because it strips out the impact of newly opened and closed locations.
Wendy’s Co. now expects 2013 adjusted earnings of 20 cents to 22 cents per share, up from 18 cents to 20 cents per share. Wall Street predicts 19 cents per share.
Its shares fell 34 cents, or 5.6 percent, to $5.78 in morning trading Wednesday. They have traded in a 52-week range of $4.09 to $6.19.
Why is Capital One showing a child taking “a sneak peek” at the right credit cards?
