Shareholders Find Little to Fear With Recalled Desserts
Retail
by Deborah Belgum
Tainted food is not the kind of news any company relishes, but analysts doubt that the Cheesecake Factory’s recall of hundreds of white chocolate raspberry cheesecakes will result in a significant hit.
The recall, announced on Aug. 6, is expected to bring a charge of one-to-three-cents per share for the third quarter.
The cheesecakes, which were contaminated with the deadly listeria bacteria, could have been served at 19 Olive Garden Restaurants in six states, not including California.
“Most analysts felt the company could quantify what the results were and that (the infection) wasn’t widespread,” said Robert Curran, an analyst with Pacific Growth Equities. “They are still trying to quantify the cost.”
The big issue is how the recall affects the Cheesecake Factory’s relationship with Darden Restaurants Inc., parent company of Olive Garden and Red Lobster restaurants.
Since the recall notice, the company’s stock price has remained relatively stable, trading at around $31.15 last week compared with $31.01 on Aug. 6. Cheesecake Factory reported second-quarter net income of $13.2 million, up 30 percent from the like period in 2001.
Cheesecake Factory executives were not available for comment.
Final Tally
The Andy Warhol exhibition at downtown’s Museum of Contemporary Art was seen by more people than originally estimated, according to final figures.
A total of 180,800 visitors bought tickets to see the art retrospective that closed Aug. 18, an increase from the 150,000 originally expected.
However, the number of total visitors, both paid and unpaid, was down slightly. Some 195,000 people saw the exhibition instead of 200,000, as originally estimated.
“We had anticipated that private rentals by corporate members of the museum would have brought in more visitors,” said museum spokeswoman Katherine Lee.
Some 6,600 new museum memberships were sold increasing MOCA’s membership from 12,400 to 19,000.
Chinese Skateboards
Vans Inc., which makes skateboard apparel and shoes, is in exploratory talks about opening skateboard parks in China.
Several firms interested in a joint venture have approached the Santa Fe Springs company, which operates 12 skateboard parks in the United States. Gary Schoenfeld, Vans president and chief executive, said talks are preliminary.
Vans’ skateboard parks have met with mixed results in the United States. The company closed a park in Bakersfield, taking a $1.2 million charge, and took a $2.3 million charge on its skateboard park in Denver.
“Theoretically the market is untapped,” said Jeffrey Van Sinderen, an analyst with B. Riley & Co. “Right now it would only make sense if there is a very limited investment in it and very limited risk.”
Staff reporter Deborah Belgum can be reached at (323) 549-5225 ext. 228, or at
[email protected].
