Winn-Dixie to Cut 5,300 Jobs as It Exits Oklahoma, Texas Markets

Dow Jones Business News(via yahoo) ^ | 5/6/02 | Dow Jones Business News

[Diddle E. Squat]

JACKSONVILLE , Fla. -- Winn-Dixie Stores (NYSE: WIN - news) Inc. (WIN) plans to exit its operations in Texas and Oklahoma by June 26 , resulting in the elimination of about 5,300 jobs.

Citing continuing losses and reduced market share, the food and drug retailer said Monday it intends to close or sell 71 stores in Texas , five stores in Oklahoma and a distribution center and dairy plant in Fort Worth , Texas . The company said Monday it is in final negotiations to sell a majority of the stores and the dairy facility to various buyers and will close the remaining stores and distribution center if buyers aren't found.

A Winn-Dixie spokesman said the company employs about 130,000.

Pulling out of Texas and Oklahoma "will allow us to focus our management talent and capital in our core markets where we get a higher return for our shareholders," Chief Executive and President Al Rowland said in a statement.

Winn-Dixie expects to book a charge of about $75 million, or 53 cents a share, related to the moves. The company expects the deals to shave annual sales by about $630 million, but add to yearly earnings by about $31 million, or 22 cents a share.

Winn-Dixie expects about $90 million from the sale of properties and liquidation of inventories.

As of late last year, Winn-Dixie operated more than 1,000 stores in the southeastern U.S.

[Diddle E. Squat]

Winn-Dixie tried to pull out of the DFW market a couple of years ago by selling to Kroger, but was blocked from doing so by the Clinton Justice Dep't as anti-competitive. This despite the fact that the DFW grocery market was and is one of the most competitive in the country. The sellout would have still left 4 major chains(Kroger, Tom Thumb, Albertson's, and Minyards), plus the heavy discounters(Sack-N-Save, Max Foods, Save-A-Lot) and full-service specialties(like Whole Foods Markets, Fiesta). I guess 9 choices is not enough?

In the last two years Target and Wal-Mart have entered the DFW grocery market in a big way, and HEB is slowly entering(and I'll bet they'll take over a large # of the prime Winn-Dixie locations). Was it really so shockingly unimaginable to the Justice Dept that free enterprise just might move in to fill a vacuum and prevent a repressive quad-opoly? < / sarcasm > So instead the red ink continued for Winn-Dixie and its investors(must not have participated in some RAT shakedown).

FYI, Minyard's head Liz Minyard is a big donor to liberals and the RAT party. Albertson's has been aggressive in contributing to left causes and especially homosexual lobbying groups. OTOH, Tom Thumb and the Randall's chain of Houston that it merged with were started by principled Christian conservatives. In fact Randall's until the merger refused to sell alcohol based on the owner's convictions. However now Tom Thumb has been taken over by Safeway, but AFAIK isn't an active political contributor.

So now we have Tom Thumbsucker, Fat Albertson's, Harry Elephant Butts, Minyard's from Mars, La Target, "!Welcome To Walmart!", Ho Fools Market, Siesta, Mad Max Foods, Slack and Slave, and, um, Kroger.

[Registered]

Your employees work overtime!

[Grampa Dave]

If this is true: Winn-Dixie expects to book a charge of about $75 million, or 53 cents a share, related to the moves. The company expects the deals to shave annual sales by about $630 million, but add to yearly earnings by about $31 million, or 22 cents a share.

Winn-Dixie expects about $90 million from the sale of properties and liquidation of inventories.

This sounds like a good business decision by Winn-Dixie.

So Target is really big in groceries back there?

[Amore]

Thanks for the info on Albertsons. For those of us who still have Winn Dixies, anything we should know about them? Otherwise, I guess I'll keep shopping at Publix here in Florida.

[Clemenza]

Winn Dixie s-cks! They stock too much "private label" goods, there stores are either dirty or butt ugly and their service is nonexistent. Makes me happy that I will be moving back to the land of A&P, D'Agostino, Pathmark, etc.

Until then, I will shop at Publix.

[StockAyatollah]

I don't patronize Winn Dixie any more. Many times I found expired food products on their shelves. WD brand beed in nasty.

[Clemenza]

Publix bump. My mom tells me that Albertsons (none in my neighborhood) are popular with her Jewish neighbors in Boca, since they carry a lot of Kosher goods. Of course in Miami, we have a third option.

[jalisco555]

What these folks need is Wegmans. Best supermarket chain in the entire US.

[Tacis]

It is a win-win situation. The folks that work at the Winn-Dixie near me in Texas are so dumb, lazy, surly and arrogant that they should have no problem transitioning into employment as airport security people. These folks make even the post office employees look good. In fact, several years ago, I bought some shares of Winn-Dizie based on a Value Line ranking. And, because I was then a shareholder, decided I had ought to try shopping there. After a couple of trips, I couldn't take any more and sold my shares. I was lucky and made a few bucks. I still try to stay out of there.

[Diddle E. Squat]

Sorry, the only grocers whose political leanings/contributions I know of were listed above.

IMHO Winn-Dixie just had an image problem in Dallas, many of its stores were older, and it just didn't have a 'hip' image(for lack of a better term) in the Dallas area. Plus grocery margins have always been tight.

Yeah, Target has really come in like gangbusters. Every new store(and many older expansions) adds a grocery section, and is marketed as a 'Supertarget'. A little pricier and not a huge selection, but the quality is high, a nice mix of specialty items and produce, so the all-in-one convenience is a big plus. Walmart is also moving toward superstores, with more selection and rock bottom prices. Personally I don't see how Minyards will be able to hang on for long(same older image as Winn-Dixie), and wouldn't be surprised if Albertson's pulls out(newer facades and supersize, but the stores are often trashy/dirty inside).

[Grampa Dave]

When my mother was still shopping, she hated the WD stores for the same reasons that you do.

[Willie Green]

We're on a flex-schedule to provide 24/7 service year-round!

[Diddle E. Squat]

I always was impressed by Publix, but A&P? They routinely get the worst ratings in customer surveys for service and quality.

The Harry's Farmers Market in Georgia couldn't be beat, and Harry's In a Hurry had the most impressive specialty take out and meals to go selection. Unfortunately HIAH just went under.

[Grampa Dave]

Some of the WalMarts out here on the West Coast have huge grocery sections. Ours is an upgraded 7-11. They carry some good local bakery breads and a few other things. Our local target has a 7-11 type area. Store rental/square foot is very expensive, and a grocery store item might not pay for the rent.

[Amore]

Yes, I agree with the assessments made here about Winn Dixie. But for some reason, my mother loves hers. I think part of it is that she's older and doesn't like those newer giant Publixes. I mean, make a mistake, go the wrong way looking for an item (which I ALWAYS do) and you're making some major treks to and fro!

[StockAyatollah]

Please elaborate on Albertson's. Their web site shows that they contribute to United Way but so do a lot of other businesses.

[Rebelbase]

Coming to this thread I would not have been suprised had the article been about the NAACP boycotting Winn-Dixie into submission over the politcally incorrect use of the word Dixie.

In my area, Winn Dixie does not seem very agressive at expanding its locations to new, suburban shopping centers. I can only think of one new store built in the past 5 years. During the same time there have been a dozen+ new, competing grocery anchors built.

The older Winn Dixie stores in older areas tend to be dirtier than competing stores and the prices for generic brands is as high as name brands at other stores.

[Clemenza]

A&P was still pretty good when I was a kid in the 80s, although the best service was provided by my local C-Town Co-op. My personal favorite grocery store of any type is independent and expensive. As far as the mainstream chains are concerned, I find Publix to be reliable in Florida, Acme in Pennsylvania, Jewel in Chicago and Pathmark in New York.

[Diddle E. Squat]

I don't remember the details, but read it in an article a few years ago. Wanna say it was a newspaper article on the growing success of homosexual activist groups in gaining corporate support, but I don't remember for sure, other than it was more direct than simply contributing to the United Way, because it convinced me not to shop there.