I've just been sitting on the side reading for a couple of years... time to put in my two cents. Scott Lea? Top notch, just look at the stock price over the last 5 years. The peak was in the middle of his tenure. He had the nerve to make some tough decisions, like hiring Tucker. Scott's problem is Lance only wants a certain amount of change and then they knock you back into line. Why did he leave? His contract was up. End of story. Tucker? One of the best Operations men I've ever worked with. As President in charge of Sales and Marketing? One of the best operations men I've ever worked with. He can't pass the physical, his philosophy is "management by last book read". If you don't believe me, check out his bookcase. He did a great job with production and he was promoted over his head. He was then reigned in and joined the good ol' boys for survival. Lance doesn't succeed because they don't really want to. Paul is a good man and a capable President, but will never be allowed to succeed... the board doesn't really want a mover and a shaker. I'm glad I'm gone.
Guys, good points from all three of you.
slugphart, "Seeing how none of the clan have actual jobs that pay them money, to cut the dividend again would mean that the stock price would fall, and the VanEvery family members would actually have to go out and find gainful employment, which is about as likely as Stroup being able to make Lance grow."
Slug, I used to hear myself from upper managment that the Van Every's would sell the company before they would cut the dividend; it was 24 cents then. But, they did cut the dividend to 16 cents; before they cut it they were paying out 24 cents the last several quarters but, were not making that much so; they were dipping into reserves.
"Also, should Lance management cut the dividend, this would mean that the VanEvery's would have to replace the upper management, and even with their poor stewardship of the company, they have not had the guts to do it yet!"
If profits do not keep up with the 16 cents dividend payout; something will have to happen.
Jag, "Slugphart, We are sure that the VanEvery Famliy has other investments besides Lance, I,m sure they have investment advisors who have guided them though the years!!!!!! Jag DayTrader."
I sure hope that they did but, if they didn't do any better with their other investments than they have with Lance that could add to the problems instead of help them.
pearlzn, "As for paying the dividends, show me one other food company that paid $.24 per quarter... or $.16/quarter, or $.10 for that matter. Food companies must invest internally to survive and Lance has not done that (and most likely never will). So between spending money in stupid places (buildings and bad business's) and paying too much in dividends, there's nothing left to grow the business."
Some very good points...Lance in the past had the advantage of being debt free; which was an advantage over other food companies therefore; should have been able to pay some type of dividend; maybe not 24 cents.
In my opinion something is going to have to happen in the very near future. My source is reliable on top management wanting to cut the dividend some more; whether that happens or not remains to be seen. I do know that you cannot pay out more money than you take up. Something is not right when you restate earnings for a quarter, insiders are selling their stock: Tucker 20,000 shares and Nancy VanEvery over 200,000 shares.
And, I have learned to never say never....Look at what happen to the dividend at AT&T. They are much larger than Lance and probably better run. Also, look at what happen to Fruit of the Loom, Montgemery Ward, and other large companies that were poorly managed; filed for bankruptcy. I don't know what the future holds but, it could be on the downside. Thanks for each of your comments.
Sunshine Man I have no ides what the Lance dividend plans are... I don't work there anymore, and wasn't exactly in the inner circle when I did. The monuments? The Columbia plant and the Chip Distribution Center (you don't hear about this, it doesn't work and never did), are the two big ones that come to mind. They were both really stupid decisions. As for paying the dividends, show me one other food company that paid $.24 per quarter... or $.16/quarter, or $.10 for that matter. Food companies must invest internally to survive and Lance has not done that (and most likely never will). So between spending money in stupid places (buildings and bad business's) and paying too much in dividends, there's nothing left to grow the business.
Sunshineman I have no idea what management is going to do about the Div,but if the cut it or eliminate it they are going to 7 Bucks a share after that what a vehicle for day trading. I really do not see that happening.
Jag Day Trader
"When it comes to Sales and Marketing, he's not the brightest crayon in the box, but he knows how to survive."
The question is; can the company survive with this type of management....I think that the days of the good ol' boys is going to come to an end one way or the way.
The powers at be can accept the facts now or pay the piper later.
You guys are trying to make sense of a situation that makes no sense. When I said Lance is a living contradiction, I meant it. Tuck was a very good operations man... granted there was lots of low hanging fruit, but he had the gonads to pick it. Then they promoted him and he joined the good ol' boys... meaning he became ineffective. It's a combination of the Peter Principal and suppression. Somebody asked "why didn't he go back to Operations"? Yeah, right, sure. Let me think, my title is President, I have a cushy office a nice company car, more stock options etc. I know if I were Tuck I'd want to give that up. Especially when I know that I'm next in line for the top job and my boss is being criticized daily on a chat board. When it comes to Sales and Marketing, he's not the brightest crayon in the box, but he knows how to survive.
"The analysts raked them over the coals, and management seemed stunned as to why."
"On the conference call Paul once again blamed the earnings shortfall on manufacturing ineffiences."
sevencolumn, the one analyst, from Merril Lynch I think, told Paul that they had the problems laid out but he had been hearing the same excuses for 6 straight quarters. Boy, Paul didn't know what to say........
"If Richard Tucker was such a great operations man, why haven't these problems been ironed out."
sevencolumn, very good point; any comments pearlzn.....
Listen to the the conference call they had when they restated earnings for Cape Cod. Only one call in.........Do you think there was some communication between Lance and the institutions before hand.....
Lance, in case you don't know yet; there is a law pretaing to DISCLOSURE now!
I think he was being sarcastic about sales increases. Most of the emphasis now is on low-margin private label and non-profit contract manufacturing. On the conference call Paul once again blamed the earnings shortfall on manufacturing ineffiences. If Richard Tucker was such a great operations man, why haven't these problems been ironed out. If you haven't heard the call yet, check it out. The analysts raked them over the coals, and management seemed stunned as to why. I think we all know why.
"I guess it was to handle this huge sales increase we've seen over the past couple of years?"
With 300 less territories, 50 less branchs; 350 less people selling on the street.....how are sales going to increase? Lance's brand sales are on the decline.....Service continues to be on the decline. If it was not for Home-Pak sales; Lance would be out of business.
I was going to mention their filling in the lake, but since they did ultimately build a distribution building, I figured I wouldn't pour salt in that wound. However one must wonder what they needed all of the extra space for... I guess it was to handle this huge sales increase we've seen over the past couple of years? More likely it's just another monument.