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Gillette nicks after the bell
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April 5, 1999: 6:27 p.m. ET
Razor company shaves a penny off analysts' estimates; Starbucks stays hot
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NEW YORK (CNNfn) - The Gillette Co. dominated Monday's after hours news with word its first quarter earnings will likely be a penny below Wall Street's estimate of 25 cents per diluted share.
The Boston-based razor and battery manufacturer said it expects to report a low single-digit growth rate in first quarter sales despite "outstanding" double-digit growth in its blades and razor business.
Negatively affecting sales were the divestiture of its Jafra International and rechargeable battery businesses, and lower than anticipated sales in its Braun business and in Latin America.
Gillette's (G) stock closed down 1-1/2 at 57-3/4 in trading Monday.
In other earnings news Monday evening, Richfood Holdings Inc. (RFH) said its fiscal fourth quarter earnings would be up 14-16 percent, in line with analysts' recently reduced expectations.
The Richmond-based supermarket chain earned 46 cents a share during the same period last year. Wall Street recently lowered its earnings' estimate for Richfield to 59 cents per share, according to First Call Corp.
Lower expectations likely will follow for International Comfort Products (ICP) as well, after the company warned it anticipates lower than expected earnings for the first quarter.
The Franklin, Tenn.-based air conditioning and furnace manufacturer said despite increased sales, this year's mild winter would keep earnings below Wall Street's projection of 11 cents per share by an undisclosed amount.
Allied Holding Inc. (AHI), an automotive distributor, also warned it would post a net loss of up to $4.5 million during the first quarter, below analysts' projection of a net loss of 4 cents per share.
On a more positive note, Starbucks (SBUX) continued to brew its savory earnings blend, reporting Monday consolidated net revenues of $153 million for the five week period ended March 28, up 27 percent from the $120 million posted a year earlier. On a same store basis, sales increased 6 percent during the same period.
For the 26 weeks ending March 28, consolidated net revenues were $781 million, up 27 percent from the $617 million posted during 1998. Comparable store sales rose 5 percent during the same period.
One other company expected to see an earnings boost this year is Duane Reade Inc. (DRD), which said Monday it would post a net tax benefit of nearly $5 million this year.
Officials with the New York-based drug store chain said the company will begin utilizing the net tax loss carryforward benefits it has accumulated in recent years starting in the first quarter.
In SEC-related news, Sun Healthcare Group (SHG), an international long-term care provider, said the Securities and Exchange Commission determined its June 30, 1998, acquisition of Retirement Care Associates Inc. must be restated as a purchase, not a pooling of interests.
As a result, the company expects to restate its financial results for 1998 on Friday.
One company not expected to report that soon is Turbodyne Technologies Inc., which late Monday asked the SEC to extend its April 15 filing deadline for its annual report.
Turbodyne (TRBD), which manufactures pollution-reduction and fuel economy systems for automotive engines, said it has not been able to complete its 10-K filing for a variety of reasons, including the substantially increased costs of establishing a new manufacturing facility in Mexico.
Finally, Chiron Corp.'s and Theragenics Corp.'s efforts to develop new cancer treatments both received substantial boosts from federal agencies late Monday.
Chiron (CHIR) said it soon will begin marketing a new drug that treats lymphomatous meningitis -- a serious complication of non-Hodgkin's lymphoma -- after the U.S. Food and Drug Administration approved DepoTech Corp.'s application to manufacture the drug. Chiron has signed on to market the drug.
Theragenics Corp.'s effort to treat prostate cancer was lifted by an agreement giving the company access to unique U.S. Department of Energy technology.
The agreement will enable Theragenics (TGX) to significantly increase production of its essential raw material and become the country's leading manufacturer of radioactive seed implants used to treat prostate cancer.
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