Wednesday, January 30, 2013

Earnings Call Notes 1.30.13

Below are quotes from an assortment of recent earnings calls--snippets of information that I find relevant (typically on a macro/industry level) from companies that I have some working understanding of.  Complete transcripts can be found at Seeking Alpha.

Amazon (AMZN)
There is not a lot I can comment on in terms of our plans similar to last year no as we progress through the year, we can give you further updates on what we plan to do there.... 
there's not a lot more I can add to it... 
just stay tuned and we will let you know as the year progresses... 
we will continue to expand our footprint over time ...Beyond that there is not a lot I can add... 
we haven’t given a lot of detail but I think one thing certainly to look at... 
I can't give you specific numbers but we have seen very good progress... 
I can't give you specific for attach rates but the business is making good progress... 
I do not have a specific number for you there, but yes... 
We will continue to add selection on the Instant Video. Beyond that, you have to stay tuned... 
There are not a lot of specifics. We have long been in the practice of not talking about trends in within the quarter in terms of year-over-year growth or anything like that... 
we haven't broken out the first-party versus third-party units since it's something we have done for that's only I am today or we have done in previous calls, so it's not I can help you with there... 
There's not a lot I can specifically talk about as it relates to LivingSocial ...
Boeing (BA)
commercial airplane deliveries was 601 delivered, the most since 1999, and the second-most in commercial aviation history. 
we also led the industry in net new orders, with 1,203, the second highest total in our company’s history 
Our commercial backlog of nearly 4,400 airplanes totals a record $319 billion 
Nearly two-thirds of our order book is with customers outside the U.S. and Europe 
For the quarter, we delivered 23 787s, reaching a total of 46 for the year 
doubling 787 production, increasing the rate from two airplanes per month to five per month 
final assembly build rate to seven per month in mid 2013 and 10 per month by late 2013
The 737 production rate will increase to 38 per month in the second quarter of this year and then move up to 42 per month in the first half of 2014.
Jones Lang LaSalle (JLL)
while capital values continue to increase in most major markets around the world compared to the prior year, the rate of growth has slowed in a number of key markets. 
The vacancy rates across 98 global markets remain stable in the fourth quarter at 13.2% as vacancy declines in the U.S. and Europe were offset by increases in Asia Pacific. Prime rental growth slowed in the quarter, increasing 2.1% year-on-year, while Beijing, Sao Paulo, Mexico City and San Francisco recorded the strongest rental growth in 2012 while demand falls, so prime rent decreased furthest in Hong Kong, Singapore, Paris, Madrid and Brussels. 
institutional investors are maintaining and, in many cases, increasing their allocations to real estate, attracted by returns that compare favorably to other investment options.
Robert Half (RHI)
Small and midsize companies are hiring. 
There is ongoing demand for flexible staffing. The percentage of temporary jobs created in the U.S. in this cycle is double that of the prior one, 13.2% versus 6.5%. The pace of temporary staffing growth in the current recovery also has been faster. 792,000 temporary jobs were created in the 39 months ended December 2012. In the prior recovery, it took 56 months to add 513,000 temporary jobs. 
As of the end of 2012, the temp penetration rate in the United States was 1.9%, of total U.S. non-farm employment, which is close to the high point in the last cycle. This percentage is approaching the record high of just over 2% in 2000. There is opportunity, we believe, for the temp penetration rate to expand further based on the secular demand for staffing flexibility we have been discussing. 
Affordable care act: we can legally help [our clients] remain under 50 [employees] since we're the employer of record for the temporaries we provide to them 
It's estimated that there are 130,000 firms with 50 or fewer employees, that over half of them do not provide coverage to their employees. 
the data would show that our European operations are bottoming
W.R. Berkeley (WRB)
there would appear to be an increasing awareness of the impact that diminishing investment income is having on the industry’s economic model. While this macro situation is widely discussed, the sense of urgency in tackling these issues seems to vary from carrier to carrier. Having said this, there is an ever-growing percentage of the market that is pursuing rate in an effort to remedy the situation.

On Sandy: the industry received a wake-up call with regards to the imperfections of both cat modeling, as well as local building codes as we endure the impact that a large tropical storm can have on a region.

Workers’ compensation remains one of the lines of business where the market is most aggressive in seeking rate.

The excess casualty market is also showing early signs of a return to underwriting discipline

combined of a 98.1%. However, when one adjusts for storms as well as reserve development, we believe the company is running at about a 96.5%

With every passing quarter, it is becoming more apparent we are entering a hard market. The number of carriers seeking broad rate increases continues to grow, and the minority of companies that continue to act irresponsibly is a dwindling population. While it is true we have not yet reached the point where there is low-hanging fruit, it has been many years since we as an organization have been so encouraged by the market.

The benefits of start-ups are twofold. One, as opposed to buying something, you don’t get someone else’s problems. And two, you don’t get intangible assets on your balance sheet, you get to tax deduct the expenses of building the business, and you don’t have carry forward issues as you go forward.
Ford (F)
In the fourth quarter, total company production was about 1.5 million units, 125,000 units higher than a year ago. This is 13,000 units higher than our guidance. We expect total company first quarter production to be about 1.6 million units, up 160,000 units from a year ago reflecting higher volume in all regions except Europe. Compared with fourth quarter, first quarter production is up 72,000 units.

This was our first U.S public debt issuance in about a decade and took advantage of favorable market conditions to issue low cost, long term debt.

Europe inventory destocking: It’s principally behind us. We still have a little bit of an imbalance...But the majority, the vast majority of the destocking is behind us.
Manpower (MAN)
Revenue in Southern Europe was slightly weaker than expected...Revenue in Italy was down 8%...Spanish market continues to remain soft in the quarter...higher vacation and lower bench utilization in Germany and Sweden, which also negatively impacted the gross margins...We continue to see soft demand within the Swedish market...Japan experienced modest growth...Australia continues to languish...Our business in China and India continue to grow nicely and contribute to the bottom line 
Secular trends in the area of Manpower, Experis, Right, Manpower Group Solutions, and emerging markets are all there. In many cases, the voice of these positive secular trends have been ground out by the cyclical nature of what is occurring, particularly in Europe, but it cannot be underestimated. 
The conversations we’re having with our clients and prospects for the need for agility is translating to much more of an outcome based solutions environment as well as the use of temporary staff to create the agility that is required
Potlatch (PCH)
Our Wood Products division continues to perform exceptionally well bolstered by a significantly higher demand and pricing as the housing market recovers. Furthermore, the division finished the year with its best annual performance in the nearly a decade.

Like we are currently running our facilities at about 104% of capacity due to the amount of over time that we operate the facilities and that’s on a two shift basis.
The x cat [excluding catastrophe] accident year combined ratio was 91.4% 
Book value per share grew about 2%, and our operating ROE for the quarter was 8% 
Our commercial P&C business in the U.S. continued to benefit in the quarter from an improving price environment where we are now achieving rate-on-rate increases for the second quarter in a row, and I firmly expect this to continue. 
From what I see today, I am more bullish about the pricing environment in the U.S. than I have been for some time.
AK Steel (AKS)
Steelmaking input costs, namely coal, coke and iron ore, have fallen, and that will result in significant cost savings for us in 2013. Second, we expect to benefit from increased shipments to both the contract and spot markets in 2013 due to slightly improved overall demand and a greater share of the automotive market.
Nucor (NUE)
New CEO John Ferriola: As we announced on November 16, I became Nucor's CEO at the start of this year. 
current capacity utilization of just 75% for the U.S. steel industry.

Nucor will continue to be proactive in bringing attention to the critical need for our government to enforce rules-based free trade.
Waddell and Reed (WDR)
Average productivity per advisor continue to increase reaching $44.3 thousand during the quarter, a record’s high. 
We’ve seen a significant increase in the appetite for our equity products and we have not seen a concurrent diminution of the appetite for the fixed income products that had been working, which is to say, the sales are broad based and in that sense encouraging.
J&J Snack Foods (JJSF)
Churros sales were up 33%...Soft pretzels sales however were up 5%...ICEE and frozen beverages, frozen beverage and related product sales were up 4%

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