Debt pushes Payless into bankruptcy
NEW YORK -- Payless ShoeSource filed for Chapter 11 bankruptcy protection late Monday after announcing Friday that it is shuttering its remaining stores in North America.
The shoe chain began holding going-out-of-business sales Sunday at its North American stores.
The company, based in Topeka, Kan., updated the number of stores it is closing to 2,500, up from the 2,100 it cited on Friday when it confirmed it was planning to liquidate its business. It reiterated that stores will remain open until at least the end of March and that the majority will remain open until May.
The liquidation doesn't affect its franchise operations or its Latin American stores, it said.
The debt-burdened chain filed for Chapter 11 bankruptcy protection a first time in April 2017, closing hundreds of stores as part of its reorganization.
"The challenges facing retailers today are well documented, and unfortunately, Payless emerged from its prior reorganization ill-equipped to survive in today's retail environment," said Stephen Marotta, Payless ShoeSource's chief restructuring officer.
He noted that the previous Chapter 11 proceedings left the company with too much debt and with too many stores.
-- The Associated Press
Ford plans to close factory in Brazil
SAO BERNARDO DO CAMPO, Brazil -- Ford Motor Co., attempting to turn around its money-losing South American business, is shutting a factory in Brazil and exiting the region's commercial heavy-truck business.
The automaker expects to record $460 million in charges and will halt production this year at its Sao Bernardo do Campo assembly plant, according to a statement. The plant employs almost 2,800 workers building Cargo, F-4000 and F-350 trucks, plus the Fiesta small car. A spokesman declined to give a specific number of job losses as the company continues to work with union officials on the cutbacks.
"We know this action will have a major impact on our employees in Sao Bernardo and we will be working closely with all our stakeholders on the next steps," Lyle Watters, Ford of South America's president, said in the statement.
Chief executive Jim Hackett is leading an $11 billion restructuring of Ford and has emphasized the strength of its commercial truck business elsewhere in the world. Total earnings before interest and taxes plunged last year, with the company losing $678 million in South America.
-- Bloomberg News
Oklahoma board backs poultry rules
OKLAHOMA CITY -- The Oklahoma Board of Agriculture has approved setback proposals for new or expanding poultry operations, to the dismay of some eastern Oklahoma residents who say they aren't enough.
The board voted 3-2 Tuesday for the rules that include requirements that operations with fewer than 150,000 birds be at least 500 feet from homes and that larger operations be at least 1,000 feet away. All operations must be at least 1,500 feet from schools.
The proposal now goes to the Legislature.
Pam Kingfisher of the unincorporated Rose community in Mayes County said the setbacks don't go far enough. Kingfisher said that a previous proposal was for setbacks of a quarter-mile from homes and a half-mile from schools.
-- The Associated Press
Foundation will double journalism aid
NEW YORK -- The Knight Foundation said it will invest $300 million in local journalism over the next five years, seeding several programs designed to kick-start an industry decimated by layoffs and newspaper closures over the past 15 years.
The plans, announced Tuesday, will double the amount of spending made in this area over the past few years by the foundation started by newspaper publisher brothers John S. and James L. Knight.
Among the beneficiaries are the American Journalism Project, which provides grants to local nonprofit news organizations; the investigative site ProPublica; Report for America, a service organization that pays for the hiring of local journalists; and PBS' Frontline, the documentary program that's making a foray into local news.
"What this initiative aims to do is really help build a future for local news," said Jennifer Preston, vice president for journalism at the Knight Foundation.
Until 2005, Knight had focused much of its journalism philanthropy on education. But it began focusing on helping news organizations weather the technological changes to the industry and, since 2015, has funded more local projects. They include supporting an effort by 17 news organizations in the Philadelphia area for a report on the effects of mass incarceration.
Preston said Knight hoped its commitment would spur other funding sources to join in support of local news.
-- The Associated Press
Baggage-weight errors hit Southwest
WASHINGTON -- Federal officials have told Southwest Airlines to fix the way it calculates the weight of luggage loaded on flights after finding frequent mistakes during a yearlong investigation.
Southwest said Tuesday that it has made improvements in its methods for calculating the weight and balance of loads and that it isn't facing enforcement action.
The airline said it voluntarily reported the issue to the Federal Aviation Administration last year.
The FAA investigation was first reported by The Wall Street Journal.
The newspaper said internal FAA documents showed that the airline made frequent mistakes in calculations and luggage-loading practices that could cause errors when pilots compute their planes' takeoff weight.
Dallas-based Southwest told The Associated Press that ground workers manually count and record how many bags go on each plane. The airline uses FAA-approved average weights for bags and passengers, then adds the actual weight of fuel and freight to calculate each load. Southwest said it also builds in a safety margin.
The FAA found cases in which the bag load was more than 1,000 pounds heavier than paperwork indicated, the Journal reported.
Safety experts say pilots might respond incorrectly to engine emergencies if they had inaccurate information about the distribution of weight between front and rear cargo bays.
An FAA spokesman said the agency opened an investigation in February 2018. Since then, he said, the FAA has directed the airline to develop a comprehensive fix to the methods and processes it uses to determine baggage weight.
-- The Associated Press
Business on 02/20/2019