VOL. 6 | NO. 29 | Saturday, July 13, 2013
Fred’s Key Revenue Figure Rises in June
Discount retailer Fred’s Inc. said Thursday its June revenue at stores open at least a year rose 4.5 percent, helped by warmer weather and stronger sales of food.
Analysts expected a smaller 1.1 percent rise, according to a Thomson Reuters poll. The metric is a key measure of a retailer’s health, because it excludes revenue at stores that recently opened or closed.
Total sales for the four weeks that ended July 6 rose 3 percent to $187.7 million.
CEO Bruce Efird said customer traffic and the number of transactions both improved during the month. Discounts on food items drove shoppers into stores, and warmer weather helped sales of lawn and garden products, summer toys and other seasonal goods. Results from Fred’s pharmacy department also improved.
Year to date, revenue at stores open at least a year were flat, while total sales rose 1 percent to $841.6 million.
Memphis-based Fred’s operates 715 stores, including 21 franchised stores, in the southeastern U.S.
Wunderlich Grows Equity Capital Markets Division
Memphis-based brokerage firm Wunderlich Securities Inc. has named a new director of equity capital markets and added four equity capital market professionals to the department.
James Dobson will serve as director of research and managing director of the equity capital markets division. He joined Wunderlich in 2009 and has more than 20 years of experience as an equity analyst and investment banker.
Also joining Wunderlich Securities’ equity research department as senior vice presidents are Robert Derrington, Todd Scholl and James Terwilliger.
The firm’s equity capital markets division now has 18 senior analysts covering companies in six industries. There are also 18 senior salesmen, nine traders/sales traders and 20 senior investment bankers.
Wiseacre Brewing to Can Local Beer
Beer lovers will soon be able to get Memphis-made craft beer in a can.
Wiseacre Brewing Co. will package its two year-round beers, Tiny Bomb American Pilsner and Ananda India Pale Ale, in a can, making it the first craft brewery in Tennessee to can beer.
Wiseacre opens later this year in the Broad Avenue Historic District.
Wiseacre’s Kellan Bartosch said canning the two beers would make them more portable and recyclable while delivering a better taste.
“Recent breakthroughs in canning liners have eliminated the oxidation of aluminum into beer, “Bartosch said. “ Cans protect completely from light and oxygen making them basically miniature kegs.”
The beer’s packaging will include distinctly Memphis flair, with Memphis native Rachel Briggs designing the artwork for the packaging of both beers.
Briggs, whose work includes illustration and photography, said she was aiming to reveal each brew’s personality.
“The stories of beers and breweries conjure up special little identities in my mind, which I get to process out onto paper and eventually on a can,” Briggs said.
Schools Early Voting Tops 10,000
Early voting in advance of the July 16 election day in Shelby County’s six suburban towns and cities topped 10,000 through the next to last day of the early voting period.
A total of 10,907 citizens cast early ballots through Wednesday, July 10, according to Shelby County Election Commission statistics.
Thursday, July 11, was the last day of early voting.
The most popular of the early voting sites in the set of six referendums on forming municipal school districts was Collierville Church of Christ where 3,580 early ballots had been cast through Wednesday. That was followed by 2,899 early voters at Germantown’s New Bethel Baptist Church and 2,443 at Bartlett’s Bethel Church.
30-Year Mortgage Rate at 2-Year High
The average U.S. rate on the 30-year fixed mortgage rose this week to 4.51 percent, a two-year high. Rates have been rising on expectations that the Federal Reserve will slow its bond purchases this year.
Mortgage buyer Freddie Mac said Thursday that the average on the 30-year loan jumped from 4.29 percent the previous week. Just two months ago, it was 3.35 percent – barely above the record low of 3.31 percent.
The average on the 15-year fixed mortgage rose to 3.53 percent from 3.39 percent last week. That’s the highest since August 2011.
Chairman Ben Bernanke has said the Fed could slow its bond purchases this year if the economy strengthens. The purchases have kept rates low. The yield on the 10-year Treasury, which mortgage rates typically track, has been rising.
Even with the gains, mortgage rates remain low by historical standards. Low rates have helped fuel a housing recovery that is helping to drive economic growth this year.
To calculate average mortgage rates, Freddie Mac surveys lenders across the country on Monday through Wednesday each week.
The average doesn’t include extra fees, known as points, which most borrowers must pay to get the lowest rates. One point equals 1 percent of the loan amount.
The average fee for a 30-year mortgage was 0.8 point this week, up from 0.7 point last week. The fee for a 15-year loan also rose to 0.8 point from 0.7 point.
The average rate on a one-year adjustable-rate mortgage was unchanged at 2.66 percent. The fee rose to 0.5 point from 0.4.
The average rate on a five-year adjustable mortgage rose to 3.26 percent from 3.10 percent. The fee was unchanged at 0.7 point.
Mississippi Mayor Enters Plea in Testing Fraud Case
A Mississippi mayor has pleaded not guilty to charges for his alleged role in a scheme run by a Memphis educator who helped teachers cheat on certification exams over a 15-year period.
Metcalfe Mayor Corey Holmes appeared Wednesday in federal court in Memphis. He remains free on his own recognizance. No trial date has been set.
Holmes’ plea was first reported by WABG-TV in Greenville.
The indictment alleges Holmes paid Clarence Mumford in 2008 to have a ringer take three different exams – one each in Mississippi, Arkansas and Tennessee. The ringer had Holmes’ Social Security card and paid for the exam with Mumford’s credit card.
Holmes is charged with wire fraud, conspiracy and Social Security fraud.
If convicted, Holmes could be sentenced to up to five years.
Tennessee Ranked No. 14 in Goods Exports Last Year
Tennessee ranked No. 14 in the nation in goods exports last year, with an estimated value of $30.7 billion, according to a state-by-state analysis by the industry group Business Roundtable.
The analysis found medical equipment is the state’s top goods export, followed by motor vehicle parts, computer equipment, basic chemicals and synthetic rubber and resins.
The state’s medical equipment exports have increased by 28 percent since 2002. In 2012, exports of these products reached about $3.2 billion.
Overall, international trade supports an estimated 788,000 jobs in Tennessee.
Restaurant Technologies Opens Memphis Location
Restaurant Technologies Inc., a Minneapolis-based frying-oil delivery, management, removal and equipment service firm, is opening a Memphis location.
The new oil depot at 3930 Willow Lake Blvd. will support 65 current customers across Western Tennessee, Eastern Arkansas, Northern Mississippi and Southern Missouri. It will also supply and service more than 80 new installations coming online in the region during the next four months, according to the company.
RTI installs equipment, and monitors and delivers fresh oil. It also removes used oil. The Memphis depot will initially employ 10 people. McDonald’s, Burger King, KFC, Carrabba’s, Applebee’s and Chili’s, among others, use RTI’s services.
US Wholesale Stockpiles Shrink in May, Sales Rise
U.S. wholesalers cut back on restocking in May even as sales rose, indicating economic growth could pick up later this year as they rebuild their stockpiles.
The Commerce Department said Wednesday that wholesale stockpiles shrank 0.5 percent in May, the most in 20 months. That followed a 0.1 percent decline in April, which was revised lower.
Sales at the wholesale level jumped 1.6 percent in May and 0.7 percent in April.
A reduction in stockpiles may prompt economists to cut their growth forecasts for the April-June quarter. But the steady gain in sales suggests companies may have to order more goods in the coming months to keep up with demand. That could boost factory production and drive more economic growth in the second half of the year.
Auto sales jumped 3 percent in May, yet stockpiles were unchanged. And sales of durable goods, items meant to last at least three years, rose 0.3 percent, while inventories of those goods fell by the same amount.
Sales of nondurable goods rose 2.8 percent, the most in more than two years. The gain was driven by large increases in sales of clothing, groceries and pharmaceuticals. Stockpiles of those goods declined 0.8 percent.
Stockpiles of farm goods fell sharply for the second straight month, dropping 6 percent.
That likely reflected the impact of a severe drought last year, which has resulted in lower stockpiles this spring.
Overall wholesale stockpiles totaled $500.9 billion in May, 3.3 percent higher than a year ago.
Senate Fails to Keep Student Loan Rates Low
Senate Democrats on Wednesday failed to restore lower interest rates on student loans, again coming up short and perhaps signaling that undergraduates might really face rates twice as high as the ones they enjoyed last year.
The proposal from Democratic leaders would have left interest rates on subsidized Stafford loans at 3.4 percent for another year while lawmakers took up a comprehensive overhaul. The one-year stopgap measure failed to overcome a procedural hurdle as Republicans – and a few Democrats – urged colleagues to consider a plan now that would link interest rates to the financial markets and reduce Congress’ role in setting students’ borrowing rates.
The competing proposals failed and lawmakers said students would face higher costs to repay their loans after graduation.
The failure to win a one-year approval – combined with little interest in such a deal in the Republican-led House – meant students would be borrowing money for fall courses at a rate leaders in both parties called unacceptable.
The rate increase does not affect many students right away; loan documents are generally signed just before students return to campus, and few students returned to school over the July Fourth holiday. Existing loans were not affected.
However, absent congressional action in the coming weeks, the increase could spell an extra $2,600 for an average student returning to campus this fall, according to Congress’ Joint Economic Committee.
During last year’s presidential campaign, lawmakers from both parties voted to keep interest rates on subsidized Stafford loans at 3.4 percent. Yet this year, without a presidential election looming, the issue seemed to fizzle and the July 1 deadline passed without action.
Oil Rises 2 Percent on Drop in US Supplies
The price of oil rose nearly 2 percent Wednesday as the U.S. government reported another steep decline in the nation’s supplies of oil and gasoline.
By late morning, benchmark crude for August delivery was up $1.94, or 1.9 percent, to $105.47 a barrel on the New York Mercantile Exchange.
Oil has risen about $12 a barrel, or 13 percent, in the past two weeks to the highest level since early May of last year. The initial catalyst was turmoil in Egypt. The country controls the Suez Canal, a critical channel for oil and gas shipments from the Middle East. But now oil is rising on signs of increased demand in the U.S., the largest consumer of oil and gasoline.
Rising oil prices have reversed a steady decline in the price U.S. drivers pay at the pump. The average price for a gallon of gas rose 2 cents to $3.50. That’s the biggest one-day increase since May 18. The price is still 14 cents cheaper than a month ago.
MAAR Reports June Sales Increase 6.7 Percent
The local residential real estate market continues to show signs of improvement, according to recent sales figures.
Memphis-area home sales for June increased 6.7 percent compared to June 2012, with 1,459 total sales recorded, according to the Memphis Area Association of Realtors.
The average sales price for June was $161,508, up 9.9 percent from $146,899 in June 2012, according to MAAR, which records sales in Shelby, Fayette and Tipton counties.
While total sales were flat from May, year-to-date total home sales, average sales price and sales volume all saw increases.
The average year-to-date sales price was $137,571, up 9.8 percent from $125,263. Sales volume year-to-date jumped to $1.1 billion, up 22.8 percent from $895.5 million.
“Halfway through 2013 the Memphis housing market is well ahead of last year,” said MAAR President Regina Hubbard.
Furr Appointed to Building Code Board
Shelby County Commissioners approved Monday, July 8, the appointment of engineer Julie Furr of Millington to the Memphis and Shelby County Building Code Board.
Furr’s appointment by Shelby County Mayor Mark Luttrell was delayed by the commission after she voiced opposition to pushing back the effective date of new seismic building code regulations.
The later effective date for the new code at the end of the year was approved by the commission as well as the Memphis City Council. Furr remained vocal in her opposition to the decision.
Furr and other structural engineers argued the higher seismic standards should be implemented as soon as possible because of the city and county’s proximity to the New Madrid fault.
Homebuilders and developers pushed for the delay to work out a compromise. They contended the standards will add enough expense to some projects that they would be scrapped instead of completed.
US Geological Survey Studying New Madrid Seismic Zone
The U.S. Geological Survey is conducting low-level flights across sections of Missouri, Arkansas and Tennessee this week looking for clues about the New Madrid earthquake fault zone.
The USGS begins conducting the flights Wednesday over a 1,400-square-mile area across southeastern Missouri, northeastern Arkansas and western Tennessee. Crews will be measuring the magnetic field of the earth and underground rock formations to help locate concealed faults associated with the New Madrid seismic zone.
The USGS says the New Madrid area has been the most seismically active region in the United States east of the Rockies for decades.
The USGS says while there’s no evidence of an imminent large earthquake, the agency has serious concerns about the potential repeat of a destructive earthquake like those in the 1800s.
Online Degree Program Launches in Tennessee
An adult online degree program promoted by Gov. Bill Haslam opens Tuesday in Tennessee.
WPLN-FM reports legislators were hesitant to spend $5 million to open an office of Western Governors University, which targets people who have some college credit but never finished a degree.
Lawmakers argued that Tennessee’s existing public colleges could start a similar program, but Haslam convinced them to go with the Salt Lake City-based nonprofit.
The state has set a goal to graduate 55 percent of residents from college, meaning as many as 100,000 adult Tennesseans need to finish school.
Methodist to Begin $33.5 Million ER Expansion
With demolition winding down, Methodist University Hospital is poised to begin construction of a $33.5 million expansion and renovation of its emergency department.
The expanded emergency department will add 93,000 square feet of new space and 6,200 square feet of renovated space. Once complete, the expanded emergency department will add 16 patient treatment areas, bringing the total to 54.
As part of the renovation process, the main entrance to the hospital will be temporarily relocated from its current location off of Eastmoreland Avenue to off of Bellevue Boulevard.
A new circle drive is being created off of Bellevue to allow vehicle drop-off access during construction. Pedestrian access to the new entry will be available from the marked walkway along Bellevue. The entry point to the marked walkway is at the corner of Eastmoreland and Bellevue.
Entry to the existing emergency department on Eastmoreland will remain unchanged.
Memphis' First Logistics Hackathon in the Works
Preparations are underway for the launch of Memphis’ first logistics hackathon.
It will happen sometime this fall with the date still to be determined, and it’s being spearheaded by the Memphis Bioworks Foundation and Start Co.
The idea is for developers and logistics professionals to come together for a weekend of competitive designing and coding. They’ll tackle logistics challenges faced by large companies like FedEx and will have the opportunity to work with application programmer interfaces to develop logistics solutions.
Additionally, Memphis Bioworks and Start Co. have been planning to launch a new logistics accelerator that would be similar to the existing ZeroTo510 accelerator, which focuses on medical device startups.
Teacher Salary Plan Raises Concern
A decision by the state Board of Education to change how teachers are paid has led to a social media push to remove Education Commissioner Kevin Huffman.
The Tennessean reports the creation of two Facebook pages calling for Huffman’s ouster as well as a Change.org petition that has hundreds of signatures.
Huffman’s ouster would be unlikely, as Gov. Bill Haslam, state education board chairman Fielding Rolston and outside education advocates came to his defense. Rolston noted it was the board’s decision, not Huffman’s.
The board approved the changes last month after supporters and opponents argued for two hours over the matter. The measure changes the minimum teacher salary schedule, reduces steps in salary increases from 21 to four and eliminates incentives for doctorate degrees and post-master’s training.
“I think we’ve made it abundantly clear we asked him to do this,” Rolston said.
Haslam released a statement in support of Huffman.
Arlington, Lakeland September Ballots Set
Lakeland has a three-way race for mayor in September, and the three incumbent aldermen seeking re-election in Arlington each have opposition, also in September.
The Shelby County Election Commission has set the ballot for the Sept. 19 non-partisan elections in the two suburban communities.
In Lakeland, incumbent mayor Scott Carmichael faces a challenge from former mayor Jim Bomprezzi and Shelby County Commissioner Wyatt Bunker.
Voters in Lakeland will also elect two commissioners from a field of five contenders – Donald O. Barber, Sherrie Gallick, Clark W. Plunk, Cecil Tompkins and John Wilkerson. Each voter votes for two candidates in the group.
In the three races for Arlington aldermen, Position 4 incumbent Oscar Brooks Sr. is being challenged by Brian Groves, who ran for Arlington mayor in 2011.
Position 5 incumbent Harry McKee has a challenger in Joshua Fox.
And Larry M. Harmon Jr. is challenging Position 6 incumbent Brian Thompson.
Early voting for the Sept. 19 election day in each city is Aug. 30 to Sept. 14.
St. Jude Awarded Nearly $450,000 Grant
St. Jude Children’s Research Hospital has picked up a $437,500 grant.
The funding comes from the National Eye Institute, part of the National Institutes of Health. It was announced by U.S. Rep. Steve Cohen, D-Memphis, who said the money will help doctors and scientists at St. Jude better understand one of the most basic human senses.
According to Cohen’s office, the funding will be used for a project researching the epigenetic reprogramming of retinal neurons.
MED Adds Healy-Collier, Colley to Leadership Team
The Regional Medical Center at Memphis has added two new employees to its leadership team.
Kathleen Healy-Collier has been hired as vice president of business line operations. Healy-Collier joins The MED after holding various executive leadership roles at Le Bonheur Children’s Hospital.
She holds a doctorate in health administration from the Medical University of South Carolina, a master’s degree in health administration from the University of Memphis and a bachelor’s degree from Saint Louis University.
And Sarah Colley has joined The MED as senior vice president of human resources. In her new role, Colley is responsible for personnel, recruitment, labor relations, training and development and occupational health. Colley joins The MED after working in human resources leadership positions for nearly a decade at health systems in Little Rock, Ark.
Colley earned her undergraduate degree from Guilford College in Greensboro, N.C., a Juris Doctorate from the University of Arkansas School of Law and a master’s degree in health administration from Webster University in Little Rock.
Zellner Construction Honored for MATA Facility
Memphis-based Zellner Construction received an award for the Memphis Area Transit Authority airport facility the company built.
Zellner was awarded the American Institute of Architects Gulf States Honor Citation for the project at the corner of Brooks and Airways near Memphis International Airport. The $15.8 million, 30,000-square-foot MATA station houses MATA and Greyhound Lines.