All posts by jinmanli2018

Women-only Capsule Hotels sprout in Tokyo

By Jinman Li
Medill Reports

Tokyo–Capsule hotels, a simple form of lodging that originated in Japan in the 1970s, finds itself in a wave of increasing female focus.

A capsule hotel reduces lodgers’ needs to the bare necessities of a tiny individual pod with a bed, lights, Wi-Fi coverage, and sometimes a TV. A typical sleeping space costs half as much as a conventional hotel room.

Japanese salarymen used to be the major target audience of capsule hotels. Now business travelers and vacationers also take up a significant proportion of the expanding available space.

According to research conducted by WiseGuy Research Consultants Pvt. Ltd. in August 2017, the global capsule hotels market was valued at $159 million in 2016 and was expected to reach $226 million by the end of 2022, growing at a compound annual rate of 6.03 percent between 2016 and 2022. Although the global market is expanding fast, Japan still plays a significant role in the capsule hotel market.

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Kellogg earnings exceed estimate, stock rises

By Jinman Li
Medill Reports

Kellogg Co.’s (NYSE: K) fourth-quarter earnings topped Wall Street’s estimate, thanks to the acquisitions of protein bar maker RXBAR and Brazilian food seller Parati, as well as to favorable currency translation.

The Battle Creek, Mich.-based cereal company swung to a profit of $428 million, or $1.23 per diluted share, in the quarter ended Dec. 30, compared with a year-earlier loss of $52 million, or 15 cents per diluted share. Analysts polled by Bloomberg estimated a profit of 75.5 cents per share. Sales rose to $3.21 billion, up 3.6 percent from $3.10 billion for the same period in the year prior.

The surge in earnings came as a result of favorable mark-to-market adjustments, lower restructuring charges, and higher operating profit. The company’s quarterly reported operating profit jumped nearly seven-fold to $669 million from $98 million in the prior-year quarter. Strong productivity savings related to the Project K restructuring program, represented by the exit from U.S. Snacks segment’s Direct Store Delivery (DSD) system, contributed significantly to the growth, which offset the company’s increased investment in advertising and promotion.

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U.S. manufacturing expanded at rate close to peak

By Jinman Li
Medill Reports

The U.S. manufacturing sector continued to show strong momentum in January, beating the market consensus.

The Institute of Supply Management reported Tuesday that its January purchasing managers index, or PMI, a composite indicator of the manufacturing sector, slipped 0.2 percentage point to 59.1 from a December reading of 59.3. A PMI reading above 50 percent indicates that the manufacturing economy is generally expanding, according to ISM.

Economists predicted an average of 58.7, according to Bloomberg.

“A change of this size can’t be meaningfully interpreted,” said Patrick Franke, U.S. economist at Helaba in Frankfurt, Germany, who describes the reading as an unchanged condition. “The strong momentum definitely continues.”

The weakened dollar, which makes U.S. manufacturing products more competitive in the international market, and the deregulatory policies under the Trump administration, contributed to the expansion, said Franke.

“The upturn of the global economy” is another driver behind the growth, which boosted new export orders 2.2 points higher to 59.8, said Louis Crandall, chief economist at Wrightson ICAP LLC, an economics research firm.

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First Midwest Bancorp shares sink as fourth-quarter performance fails expectations

By Jinman Li
Medill Reports

Shares plummeted by 4.1 percent after First Midwest Bancorp Inc. (Nasdaq: FMBI), the holding company of First Midwest Bank, released fourth-quarter earnings that fell short of Wall Street expectations.

The Itasca, Ill.-based company reported net income of $2.3 million, or 2 cents per diluted share, for the quarter ended Dec. 31, 2017, down 88.7 percent compared with $20.7 million, or 25 cents per diluted share, for the year-ago quarter, failing to meet the consensus estimate of 3 cents.

The tax reform legislation enacted in 2017 contributed to the decline. A downward revaluation of the company’s deferred tax assets, or prepayment of anticipated taxes, triggered an additional income tax expense of $27 million, or 26 cents per share.

“Excluding tax-related actions and costs attendant to acquired growth, earnings per share improved 6% and 11% for the quarter and full year versus a year ago,” stated Michael L. Scudder, chairman and chief executive officer, in a press release.

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Fifth Third Bancorp shares hit a 10-year high after earnings top expectations

By Jinman Li
Medill Reports

Earnings of Fifth Third Bancorp (Nasdaq: FITB), the holding company of the Cincinnati-based regional banking corporation Fifth Third Bank, leapt 31 percent in its fourth-quarter report, topping Wall Street estimates. The results were favorably impacted by Vantiv-related investment throughout 2016 and 2017 and the Tax Cuts and Jobs Act in 2017.

The company earned $486 million in the quarter ended Dec. 31, compared with $372 million of the year-ago quarter. Earnings per diluted share were 67 cents, compared with 49 cents per diluted share in the fourth quarter of 2016. The adjusted earnings per share were 52 cents, beating the analysts’ estimates of 47 cents per share compiled by Zacks Investment Research Inc.

“Some non-core items, including additional benefits from the new tax legislation, resulted in a positive $0.15 impact to reported earnings per share in the quarter,” said Gregory D. Carmichael, president and chief executive officer of Fifth Third, during the earnings call.

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