It should feel like a better economy is coming. The U.S. economy grew 2.8 percent in the third quarter and added more jobs nationwide than expected in October. But the good news is not enough to ease concerns among Tampa Bay executives.
Even as their companies post promising quarterly performances, many firms still feel they are clawing out of a recession that technically ended way back in June 2009.
The most insightful comment this past week was made by Liz Smith, chief executive officer of Tampa casual dining giant Bloomin' Brands — whose chains include Outback Steakhouse, Carrabba's Italian Grill, Bonefish Grill and Fleming's. Smith told analysts that while the company's restaurants outperformed most competitors, there won't be substantive gains in dining sales "until there is a meaningful improvement in consumer disposable income."
In Florida, where wages are flat but costs are rising, such improvement may take a while.
If diners are not yet flocking to restaurants, more consumers may be creeping back into boating. So suggests boat retailer Bill McGill, CEO of long-battered Clearwater-based MarineMax, whose fiscal year just finished.
"Despite the uncertainties in the macroeconomic environment and a weaker-than-expected first half of the fiscal year," McGill said, "we ended the year with greater assurance that the boating industry is recovering."
Yet MarineMax's bottom line was padded this year and in the past quarter by multiple damage claims paid out by BP from the gulf oil spill. And the CEO admits "we all need to be cautious" until meaningful gains are reflected in the company's results.
Other publicly traded companies ranging from Sykes Enterprises and WellCare Health Plans to Raymond James Financial — now reaping the gains from its $930 million purchase in 2012 of the Morgan Keegan firm — are among those reporting impressive double-digit (or more) earnings increases in their latest quarters.
But they, too, share cautionary remarks. Sykes, which operates U.S. and international call centers for financial and telecommunications companies, so far this year added 5,300 positions to meet new clients' demands. Yet it had to cut 3,500 other positions to reflect weaker demand by some existing clients in a choppy economy.
The difference — 1,800 positions — is Sykes' net gain this year. But it comes with higher hiring and firing costs than CEO Chuck Sykes would like.
At Tampa's WellCare Health Plans, a provider of managed health care services, the company must try to convince the market that it made sense this month to fire its CEO, Alec Cunningham, at the same time the business delivered 68 percent gains in quarterly earnings.
Something, apparently, was not clicking between WellCare's chief executive and its directors. So far, we're told only that CEO and board have different takes on how to grow the business. This tiff would not normally hit the Tampa Bay radar so hard were it not for WellCare's difficult history of emerging from the shadow of a 2007 FBI raid and a former CEO finally being found guilty this year of health care fraud.
At Lakeland's Publix Super Markets, the No. 1 grocery chain in the state saw quarterly earnings dip slightly, even as quarterly revenues increased 6 percent to $7 billion. Bottom line? Publix is still gaining market share in an increasingly visible "BOGO" food fight with Walmart and other grocery chains.
Some companies are worse off. Cott Corp., a Canadian company that makes private-label beverages and claims Tampa as its headquarters, saw declines in both net income and revenue. Trucking distributor Quality Distribution also saw a sharp drop in quarterly earnings.
Finally, let's take a peek at Tampa's Kforce, a provider of temporary staffing that experienced record revenues in the latest quarter. CEO David Dunkel continues his mantra that temp staffing will only become a bigger part of the U.S. job market. As many companies shy away from adding full-time workers, temporary or contract workers can offer more flexibility and less stress of adjusting the size of workforces in a still-uncertain economy.
Kforce thinned its own ranks recently by firing Randal Marmon, chief customer officer, and Michael Ettore, chief services officer. The company says it wants fewer chiefs, more Indians.
As Dunkel noted to analysts: "Words cannot express how thankful I am for the effort of the individuals who will not be moving forward with the firm."
It's a hard reminder that even in this slowly improving economy, getting canned and heaped with praise is no longer a contradiction.
Robert Trigaux can be reached at [email protected]