As Connecticut Republicans tagged Linda McMahon as their U.S. Senate candidate, the company she co-founded struggled in the second quarter ”“ with the economy partly to blame but also a spate of injuries and retirements for some of World Wrestling Entertainment Inc.”™s biggest stars.
Stamford-based WWE earned $6.3 million on revenue of $107 million, a 32 percent drop largely due to the scheduling of WWE”™s annual WrestleMania show in the first quarter this year versus the second quarter of 2009. Adjusting results to exclude the impact of WrestleMania, revenue increased by a half percent this year.
“We have the perfect storm, unfortunately, in terms of talent retiring (or) injured,” said Vince McMahon, CEO of WWE, in an August conference call with investment analysts. “We should never have that many talents injured at one time ”“ top talent, that is. They are coming back into the fold now ”¦ (with) an infusion of new talent, (but) it is going to take a while.”
WWE also incurred some $700,000 in additional costs in April, after the Iceland volcano eruption impacted the travel itinerary of the company”™s European tour.
Realogy Corp.
Against the ominous backdrop of the homebuyer tax credit setting to expire, Realogy Corp. had its best quarter since the onset of the recession, as revenue rose 23 percent to nearly $1.3 billion.
Parsippany, N.J.-based Realogy owns both Coldwell Banker, the largest real estate agency doing business in Fairfield County; and Cartus Corp., a Danbury-based provider of relocation services that is among the county”™s largest employers.
Cartus revenue was up 39 percent in the second quarter to $106 million, and the division earned $27 million before accounting for interest, taxes and other expenses. The company”™s 2010 results include revenue from Primacy Relocation L.L.C., a Cartus rival acquired by Realogy in January.
Primacy helped boost initiations for Cartus services 40 percent from a year ago, and Realogy”™s real estate agencies saw home-sale closings increase 12 percent.
“Clearly Realogy had a strong second quarter,” said CEO Richard Smith, in a prepared statement. “Looking forward, however, it is shaping up to be a difficult third quarter because of the expiration of the homebuyer tax credit and an uncertain near-term outlook for the economy. The sales volume of open contracts for both our company-owned and franchise segments ”“ which are the leading indicator for closed and reported sales in the third quarter ”“ dropped sharply, down an average of 17 percent in June and July on a year-over-year basis. High affordability and near-record low mortgage rates alone cannot offset the impact of high unemployment and declining consumer confidence.”
Gartner Inc.
With budget purse strings loosening up for corporate travel, Gartner Inc. booked a big rebound in its events business, even as its mainstay research unit also had solid second quarter.
A provider of technology industry research, events and consulting, Gartner earned $20 million in the second quarter as revenue rose 16 percent to $314 million. The 2009 results do not include AMR Research and the Burton Group, which Gartner acquired last December.
While event revenue benefited from the timing of some events being held in the second quarter as opposed to the first or third a year ago, Gartner said attendance was also up significantly.
“In research, we generated the highest-ever new business for any second quarter in Gartner”™s history,” said Gene Hall, CEO of Gartner, in a conference call. “The annual price increase of approximately 3 percent that we implemented last November has continued to hold, as expected, with no material push-back from clients.”
During the quarter, Gartner signed a new lease to remain in its Stamford headquarters, with rent totaling $61 million over 15 years. The company has some 850 employees in Stamford and Fairfield County. As part of an incentive package from the state of Connecticut valued at up to $26 million, Gartner agreed to add 300 more workers here by 2014.
The company”™s landlord agreed to invest $25 million in upgrades in its Stamford headquarters locale, and Gartner has the option of purchasing the property at fair market value at the end of the lease, or at the end of a five-year extension if the company exercises it.
Cenveo Inc.
Commercial printing company Cenveo Inc. said direct mail volume is increasing among financial industry clients, a sign of an improving economy, even as the Stamford-based company deals with price increases in manufacturing inputs for the paper and envelopes it produces.
In the second fiscal quarter ending July 3, Cenveo lost $8.3 million as revenue rose 12 percent from a year earlier to $445 million, with most of the gain the result of its September 2009 acquisition of New Hampshire-based Nashua Corp.
During the quarter, Cenveo spent $15 million to acquire Glyph International, which provides various content services for publishers like McGraw-Hill, including copyediting, indexing, and graphics. At the time of the acquisition, Glyph had 550 employees at two operations centers in India and sales offices in London and Fort Lauderdale, Fla.
Presstek Inc.
After unveiling a new offset printer that can turn around a job in six minutes, Presstek Inc. saw revenue drop 6 percent from a year ago to $31.6 million, as it produced its seventh consecutive unprofitable quarter.
The Greenwich-based company manufactures digital offset printers and related accessories for use by commercial printing companies and others that routinely print thousands of sheets per job.
Presstek lost $1.8 million in its second fiscal quarter ending July 3, a vast improvement from the nearly $41.5 million loss it reported a year ago.
“During the quarter we saw a reluctance by our North American base of small to mid-sized customers to make capital equipment purchases, primarily due to reduced access to financing and an increased skepticism that the U.S. economic recovery was sustainable in the near term,” said Jeff Jacobson, CEO of Presstek, in a prepared statement.
In May, Presstek announced the retirement of director Lawrence Howard, who co-founded the company in 1987 with his father and was CEO in Presstek”™s early years. Howard is now a general partner of New York City-based Hudson Ventures L.P.
Starwood Property Trust Inc.
Starwood Property Trust Inc. went in halfway on a $138 million mortgage on the Hyatt Regency New Orleans hotel, one of seven transactions since the end of the first quarter totaling $375 million.
Once one of New Orleans”™ best-performing hotels, the 1,200-room Hyatt Regency has been closed since Hurricane Katrina flooded the city in 2005 and was used during the recovery operations by various government agencies. The hotel is scheduled to reopen next fall.
The investments pushed Starwood Property”™s portfolio of real estate investments to $1.3 billion, as the Greenwich-based company recorded a $10.8 million profit in the second quarter. In August, Starwood Property negotiated a $350 million loan from Wells Fargo & Co.
“The return of the (commercial mortgage-backed securities) market will make the company more competitive by providing an attractive source for matched term non-recourse financing,” said CEO Barry Sternlicht, in a prepared statement.
Aircastle Inc.
Aircastle Inc. secured $1.1 billion in new financing during the second quarter, as improved performance by airlines helped it generate an $18 million profit.
The Stamford-based company has a fleet of nearly 130 jets that it leases to more than 60 airlines and cargo companies. Revenue was off 5 percent from the second quarter of 2009 to $130 million.
“During the past few weeks, we”™ve made great progress in securing financing for our Airbus A330 program,” said Ron Wainshal, CEO of Aircastle, in a conference call. “We obtained approximately $700 million in long-term financing commitments from three leading global banks to help fund our next nine deliveries on extremely attractive terms ”¦Â I actually think that from a revenue perspective we are pretty well locked in for the next two years, given the minimal amount of lease rollover we have.”
Compass Diversified Holdings Inc.
As it paid off $75 million in debt from the proceeds of an April sale of stock, Compass Diversified Holdings Inc. locked up a new subsidiary for its portfolio of operating companies: Liberty Safe & Security Products Inc., a Utah-based maker of home and gun safes.
The deal helped consolidated revenue shoot up 40 percent for Westport-based Compass to $404 million in the second quarter, though it still lost $750,000. The company now has seven operating companies including Staffmark, a Cincinnati-based provider of temporary employment services doing business in nearly 30 states.
WebMediaBrands Inc.
WebMediaBrands Inc., which runs websites tracking traditional and social media, saw revenue jump from continuing operations 75 percent from a year ago to $2.4 million, attributing some of the increase to online job ads.
The Norwalk-based company lost $1.2 million during the quarter.
“We are excited by the success of our trade shows that ran during the second quarter and that covered a variety of social media topics,” said Alan Meckler, CEO of WebMediaBrands, in a prepared statement.
