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August 6, 2020

Publishing News

Hearst In No Rush to Search for New President
NY Post: "The owner of Cosmopolitan, Esquire and Good Housekeeping magazines is refusing to search for a candidate to replace ousted Hearst Magazines president Troy Young in hopes that his temporary successor becomes permanent, Media Ink has learned. When Young resigned in a storm of controversy last month, numerous headhunters called Hearst executives to offer their services in finding a replacement, sources said. But they have all been rebuffed at the behest of CEO Steve Swartz, who wants to give acting president Debi Chirichella a chance to run the show. The magazine empire plans to wait until early next year before deciding whether to expand the search, these sources said. “Debi is being given a long runway,” said one source of Chirichella, who joined Hearst Magazines in 2011 — predating Young, who first joined as digital chief in 2013 before being elevated to head of the whole shebang in 2018. Chirichella was Heart Magazine’s EVP and chief financial officer when she was picked to step in as acting president — one day after Young was forced out amid allegations that he created a “toxic culture” at the Hearst unit behind Cosmo, Esquire, Harper’s Bazaar and GH, among others"...

Publishers Reveal September-Issue Covers
Fashionista offers a gallery of September issue covers released thus far, and promises to add more as they become available. Magazines "are bringing their A-game with statement-making covers and editorials"... and, even in this period of COVID and reduced ad budgets, some of the issues weigh more than a pound and exceed hundreds of pages, Fashionista notes.

Bloomberg, The Athletic to Bundle Subscriptions
Axios: "Bloomberg Media will launch a bundled subscription with The Athletic beginning this month, sources tell Axios. Bloomberg Media sees value in partnering with niche media outlets that it thinks can compliment its coverage. In February, it announced a subscription bundle with The Information, a high-end business and tech publication. Bloomberg Media launched its consumer-facing subscription service in 2018. The bundle comes with a discount. Those who purchase the $290 annual subscription (originally $415/year) will receive a free trial to The Athletic for six months, while those who opt for the $1.99 monthly subscription (originally $34.99/month) will have three months of free access to the sports news site. The partnership also includes a video deal. The two companies are piloting an ongoing relationship where journalists from The Athletic are featured on Bloomberg Media's digital news network QuickTake to do reporting on the business, culture and technology of sports. The subscription landscape is growing so competitive that news companies banding together to sell joint subscription packages may be the next big trend."

New York Mag Article Being Made Into TV Series
Deadline: "In a competitive situation with 10 bidders, Searchlight Television, along with Darren Aronofsky and his Protozoa Pictures, have won the television rights to David Gauvey Herbert’s New York Magazine article “Boss of The Beach” for series development. Search is underway for a writer to pen the adaptation, which Herbert will executive produce.Herbert’s June 23, 2020 article, published in New York Magazine‘s Intelligencer, chronicles the hopes, dreams and scandals of the New York City lifeguard corps over the last 40 years. The article has a particular focus on the tumultuous career of Peter Stein, who has run the NYC lifeguard corps for four decades. Herbert writes about crime, subcultures, and general weirdness for New York Magazine and Bloomberg Businessweek, among other publications. He is also a two-time grant winner from the Pulitzer Center on Crisis Reporting. He previously covered foreign policy as a staff writer at the National Journal in Washington, DC"...

New Yorker Short Story Being Made Into Comedy Flick
Deadline: "Universal Pictures has put together a monstrous package around the satirical Simon Rich New Yorker short story “Everyday Parenting Tips” that has Rich scripting for Ryan Reynolds to star and Paddington‘s Paul King to direct. Lord Miller’s Phil Lord, Chris Miller and Aditya Sood will produce along with Maximum Effort Productions’ Reynolds and George Dewey, and Rich. Now, a fairly short essay guide to dispensing parenting tips seems banal, but not this one: A father offers advice on what to say when their child says they believe a monster lurks under the bed — at a time when an ongoing Monster Uprising is actually happening in the world... Rich will write the script. A short story is also the way he hatched An American Pickle, which HBO Max releases tomorrow with Seth Rogen playing an immigrant who falls into a vat of pickle brine and emerges perfectly preserved a century later"...

Conde May Face Fight in Bid to Leave WTC Offices
NY Post: "Condé Nast is looking to move its headquarters out of the World Trade Center — a surprise shift that insiders say could spur a knockdown, drag-out battle with its landlords. The publisher, which only finished moving into digs that span 21 floors at One World Trade Center in 2014, is scouting out Midtown for a potential new home, sources told The Post. Late Tuesday, Condé Nast’s parent company Advance Publications confirmed to The Post that it is “in discussions about bringing the lease at One World Trade Center into line with current market conditions and its ongoing needs at this location.” Accordingly, the publisher said it “is considering alternative solutions to address these requirements.” The problem: The lease at One World Trade Center, signed in 2011 with rent payments starting in 2014, runs until 2039. The Port Authority, which owns 90 percent of the 1,776-foot-tall spire, has been stung by coronavirus-related revenue losses and can’t afford to give away the store. Insiders add that Douglas Durst’s company, the minority managing partner, projects a cheerful public face but turns street fighter when the chips are down — as in its recent bare-knuckles battle with Amazon over an aborted deal on West 34th Street for a much smaller space than Condé has downtown. Neither the PA nor Durst is in any mood to let the embattled media company just pick up its glossy titles and leave, according to sources. “They’re going to dig in like hell,” predicted a real estate insider who’s not involved with either the media company or the WTC. “They gave Condé Nast the moon to move there. Now, six years later, Condé says, ‘Well, we can’t afford it any more and Anna [Wintour] doesn’t like it any more, so we’re out of there?’” the executive snorted. Reps for both the PA and Durst issued icy “no comments.” Condé Nast’s real-estate brokers at JLL wouldn’t talk either"...

S&S Posts Q2 Profit Gain Despite Sales Decline
PW: "Revenue for Q2 ended June 30 fell 8% at Simon & Schuster vs. Q2 2019, dropping to $200M. But lower production and distribution costs were enough to give the company a 9% increase in earnings, which rose to $38M, from $35M a year ago... Among the titles that drove gains were John Bolton’s The Room Where It Happened, which which was released June 23 and sold 780,000 copies across all formats in its first week on sale. (Mary Trump’s Too Much and Never Enough was published July 14 and sold over 1.3M copies in its first week; that revenue will contribute to S&S’s Q3 results)... While print sales fell in the period, digital sales rose 44% YoY, led by a 51% jump in ebook sales and a 34% increase in physical audiobooks, [new CEO Jonathan] Karp said. While not predicting that the renewed interest in e-book sales will be permanent, Karp told PW that he sees “no reason to believe the new consumer behavior will change any time soon.” And while that will likely keep online sales strong, Karp said sales through bricks-and-mortar stores remain vital. Karp added that, during the quarter, S&S did well in big-box retailers as well as at mass merchandisers, with those outlets not only selling lots of S&S’s nonfiction books but some fiction, as well. S&S is also keeping up its support for independent bookstores, and will continue to organize numerous online author events, Karp said. The publisher's schedule for the remainder of 2020 “is the strongest list we've had in years,” Karp said"...

NY Times' Digital Revenue Surpasses Print
CNBC: "The New York Times Co. for the first time Wednesday reported higher revenues from its digital business than its print operations, a “watershed moment” in the newspaper’s nearly 170-year history, according to CEO Mark Thompson. “And we don’t think it’s likely we’re going to go back from this moment,” Thompson said on CNBC’s “Power Lunch.” The Times reported $185.5M in revenues from digital subscriptions and advertisements, compared with $175.4M in revenues from print subscriptions and advertisements. In the year-ago quarter, the company reported $220.6M in print subscription and ad revenues and $170.7M in digital subscription and ad revenues... The Times reported a 7.5% decline in overall YoY revenues as advertising sales tumbled 43.9% in the quarter due to the pandemic. However, revenues from digital advertising checked in at $39.5M, or 58.3% of its total ad sales. That’s up from 48.1% of total sales in the same quarter last year. Subscription revenues rose 8.4% YoY, powered by a 29.6% increase in digital-only revenues to $146M. Print subscription revenues dropped to $147.2M, a 6.7% decrease, mostly due to lower sales at newsstands"...


Retail News

Grocery Prices Spiking, Along With Unemployment, Food Insecurity
CNN Business: "Grocery prices have skyrocketed during the coronavirus pandemic. That has Americans spending more at the supermarket than they have in years. Prices are spiking — and not just because people are buying more groceries as they spend more time at home. The pandemic has had a strong impact on grocery prices this year, according to seasonally adjusted data released Friday by the Bureau of Economic Analysis. The BEA tracks personal consumption expenditures to help measure inflation. From February to June, meat and poultry prices rose nearly 11%, with beef and veal prices seeing the highest rise, spiking 20%. For pork the increase was about 8.5%. People are paying more for other staples, too: During the same time period, egg prices shot up 10%, and shoppers shelled out 4% more for cereals and fresh vegetables. The pandemic has caused a surge in demand for groceries as millions of Americans stay home and avoid eating out. While there's no significant shortage of food, disruptions in the supply chain have created scarcities and driven up prices. The meat supply chain has been hit particularly hard. Major meat processors closed their doors when workers fell ill and have slowed operations to accommodate new safety practices, tightening the country's supply. Things aren't back to normal yet... The higher expenditures come at a time when many Americans are struggling financially. On Thursday, the Department of Labor will release data that is expected to show that another 1.4M workers filed for first-time unemployment benefits last week, which is similar to the prior week's statistics. Meanwhile, unemployed Americans are losing a financial lifeline, as the government's weekly $600 boost to regular jobless benefits ran out on July 31. Food insecurity in particular is a growing problem. Nearly 30M out of 249M respondents told the U.S. Census Bureau they did not have enough to eat at some point in the week before July 21 — the highest number of people reporting insufficient food since the Census started tracking that data in early May"...

Ahold Delhaize's Online Sales Surge 127%
PG: "Ahold Delhaize raised its guidance for the fiscal year after reporting a 78% increase in profit and an incredible 127% increase in e-commerce sales due to "unprecedented" demand for groceries. The Dutch owner of Stop & Shop and Giant Food made a net profit for the second quarter ended Aug. 4 of $818.1M vs.  $397M for the same period last year. In the U.S., same-store sales excluding fuel were up 21% in the quarter, while European comps were up 10%. Net sales for the quarter rose 16% at constant exchange rates to $22B from $19B a year before. EPS rose to 76 cents vs. 41 cents a year ago. Ahold said it now expects to report low-to-mid 20% growth in EPS, compared with previous guidance of mid-single-digit range this year. Ahold Delhaize has been reducing its debt, remodeling stores, adding to its fulfillment capacity and strengthening its e-commerce efforts as it looks to accelerate long-term growth and leverage the opportunity in higher demand for groceries amid the pandemic. Specifically, [president/CEO Frans] Muller said during an earnings call that click and collect is growing fast during the pandemic. "We will get to 50% quite quickly, 50% share, the same indication we gave for the first quarter, which will not only support customer demand and growth levels but also will support profitability as click and collect has a better market profile than delivery," Muller said. He also said Food Lion is now the company's "fastest growing brand and achieved its 31st quarter of consecutive growth with positive comp sales.... It's proving that the high-density store network with its clear focus on fresh and affordable is hitting the sweet spot for what customers are looking for today... We also agreed to acquire 62 stores from Southeastern Grocers, which will be converted to the Food Lion brand. That should further help improve an already very strong market position as a brand in 2021 and beyond." Ahold said coronavirus-related costs in the first half were $392M, including safety measures and enhanced associate pay... "We continue to adapt to the changes we are seeing in consumer shopping patterns and behavior. One of these changes is the increased demand for our online offerings, which, combined with investments to increase capacity, has resulted in net consumer online sales growth of 127% in the U.S., at constant exchange rates, and 64% in Europe," said Muller. "Our increased investments in digital and omnichannel capabilities should lead to continued wallet share gains"... The company now expects over 55% growth in global net consumer online sales in 2020... "This puts us on track to reach our goal of doubling global net consumer online sales from $4.1B in 2018 to $8.3B in 2020, one year earlier than we outlined at our November 2018 Capital Markets Day," Muller said. Ahold also plans to open 20 more remodeled Stop & Shop stores in the second half of the year"...

Shoppers Packed Costco in July
PG: "Shoppers are starting to go back to Costco stores in droves as the club retailer reported its highest physical store comp in months and a big boost in store traffic. Costco Wholesale said same-store sales in its physical stores increased in July by 15.7%. In a pre-recorded July sales update, SVP Financial Planning & Investor Relations David Sherwood said the club retailer had "positive 4.5% customer traffic" in July, the largest increase since the pandemic's start. Average transaction size was up 11.4%. Ecommerce sales jumped 75.3%, although that was actually a deceleration from June's increase. Net sales were $13.04B for the retail month of July, the four weeks ended Aug. 2, up 14.1% from $11.43B last year. For the 48 weeks ended Aug. 2, the company reported net sales of $149.66B, up 8.8% from $137.56B during the similar period last year. The strongest departments in July were food and sundries, which had comps in the positive low 20s, with frozen food, liquor and food being the strongest sub-categories. Fresh food comps were up in the positive mid 20s (meat and produce). Hard line comps were in the positive mid 20s (appliances, hardware, health/beauty). The strongest regions for Costco in July were the Southeast, Texas and Northeast. In June, Costco reported a comp increase of 14.4%. E-commerce was up 86.7%"...

DoorDash Launches Online C Stores
The Verge: "DoorDash on Wednesday announced the launch of a chain of virtual convenience stores the company is calling DashMart, which will sell snacks, groceries, and other food-related products from partner restaurants. These stores don’t have brick-and-mortar locations. Instead, they exist solely on the DoorDash app, kind of like a ghost kitchen if it were a CVS or 7-Eleven instead. Right now, the company says DashMart is available in eight cities in the US: Chicago, Illinois; Columbus, Ohio; Cincinnati, Ohio; Dallas, Texas; Minneapolis, Minnesota; the greater Phoenix, Arizona area; Salt Lake City, Utah; and Redwood City, California. But DoorDash is planning to expand that to more locations in the future, starting with a broader rollout in California and the inclusion of Denver and Baltimore to its list of supported city markets.According to its press release, these DashMart stores are “are owned, operated, and curated by DoorDash.” That may sound like a strange new business model for DoorDash, which specializes mostly in coordinating the pickup and delivery of takeout. But the company clearly sees a big market opportunity in being the logistical partner and provider for other types of food delivery, not just freshly made meals. DoorDash already supports convenience stores like 7-Eleven, CVS, and Walgreens, letting you create a shopping cart of items from those locations for a DoorDash driver to pick up and deliver. And there’s plenty of money to be made in the convenience store and grocery markets that on-demand apps and e-commerce barely touch. Amazon, having dominated online selling, has spent the last half-decade or so building out a physical retail footprint — comprised of Whole Foods stores, Amazon Go locations, and now full-blown grocery stores — to gain a foothold in those markets"...

Weis Markets Sees Q2 Sales Surge
SN: "Weis Markets has adapted to “new market conditions” since COVID-19 hit the United States full-force in the spring, Chairman and CEO Jonathan Weis said in reporting fiscal 2020 second-quarter results this week. The Mid-Atlantic grocer saw net sales jump 23.7% to $1.1B for the 13 weeks ended June 27 from nearly $888M a year earlier. Same-store sales climbed 24.1% YoY, while e-commerce sales through the Weis 2 Go online grocery pickup and delivery service skyrocketed 243%. The surge in customer demand during the coronavirus pandemic also more than doubled Weis Markets’ Q2 net earnings. For the period, the company posted net income of $41.5M, or $1.54 per share, up 102.5% from $20.5M, or 76 cents per share, a year ago"...

Publix Closing 2 GreenWise Market Stores
PG: "Publix Super Markets has recently been growing its reimagined GreenWise Market banner tailored to natural and organic shoppers, but a recent announcement of two closures sets its location numbers back a bit. GreenWise Market will no longer have a presence in South Carolina after planning to close its Lexington and Mount Pleasant stores in the state on Aug. 29. The stores opened as GreenWise Markets in late 2019, but they're no longer a good fit for the brand, according to the grocer... After the closures, Publix will have nine GreenWise Market locations in Florida, Alabama and Georgia, with plans to open three more in the Sunshine State shortly"...


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