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Outerwall Cuts Staff, Nixes Three Ventures as Part of Restructuring

By  +Follow December 10, 2013 9:47AM
Tickers Mentioned:

Outwall Inc. ($OUTR), the company formerly known as CoinStar, on Tuesday elaborated on previously announced restructuring initiatives, saying that it is expanding its credit facility, firing employees, shuttering certain new ventures and making a change in Redbox management.  Outerwall has been under pressure to make moves since activist investor Barry Rosenstein’s Jana Partners disclosed in October that it has taken a 13.5-percent stake in the company.  Rosenstein said at that time that everything was on the table at Outerwall, including a possible sale of the company.

Out With the New

Outerwall said that it is discontinuing venture concepts Rubi (a coffee kiosk), Crisp Market (a kiosk selling prepared foods) and Star Studio (a photo booth).  The unwinding of the three programs is expected to be substantially completed by the end of Q1 2014 and result in a one-time charge of $26 million to $29 million in the fourth quarter.  The abandoned ventures are being put on the shelf with Orango, an automated retail concept that provides consumers deals on electronics through kiosks that was discontinued earlier this year.

The company will continue to invest in ecoATM, a kiosk that gives users cash for electronics like cell phones and tablets, as well as SAMPLEit, a kiosk that lets people sample a brand before buying the full-size product.  With SAMPLEit, consumers pay $1 to try versions of skincare products, snacks, cosmetics and other items and receive a coupon towards the purchase of a full-size version of the product.

Out With the Old

With the latest moves, Redbox president Anne Saunders has stepped down after just over a year at the position.   No reason was given for Saunders exit.  Outerwall CEO J. Scott Di Valerio will oversee the existing management team filling the void in duties left by Saunders until a permanent replace can be found.

Leaving with Saunders were 251 employees, or 8.5% of Outwall’s staff, as part of the venture closures and addition expense reductions.

In With the New

Outerwall increased its existing senior secured credit facility to provide an additional $350 million of debt to meet its target net leverage range of 1.75x to 2.25x net debt to care adjusted EBITDA in Q1 2014.

Jana has been pushing Outerwall to return a portion of its cash horde to shareholders and is making an impact with its wishes.  Outerwall said it plans to repurchase $195 million of its stock this year, exceeding its target by returning more than 100 percent of its free cash flow in 2013.  $50 million more in repurchases is expected by the end of January 2014.

The company also provided new guidance, raising its full-year adjusted earnings outlook to a range of $5.44 - $5.59 per share from a previously guided range of $4.89 - $5.04 per share.  The new forecast sailed past analyst expectations of $4.85 per share.

Shares of Outerwall have opened the day trading higher by more than 2 percent at $66.33.  Through Monday’s close, shares of OUTR were up about 25 percent this year.

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of equities.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions.

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Results for OUTR
18 Sep 14 01:37:30
http://t.co/l4qmOlz0qf chartguy89: Stock Charts: OUTR 60.08 Stock Charts $OUTR Outerwall Inc. http://t.co/Eu23TwGLZJ
Investors Hangout
18 Sep 14 01:34:35
chartguy89: OUTR 60.08 Stock Charts $OUTR Outerwall Inc. http://t.co/Fnt0yqjnQK
Investors Hangout
18 Sep 14 01:34:34
chartguy89: OUTR 60.08 Stock Charts $OUTR Outerwall Inc. http://t.co/6atYwhZ7y7
18 Sep 14 01:30:13
OUTR 60.08 Stock Charts $OUTR Outerwall Inc. (NASDAQ) Last Updated: 09/18/2014 03:30:20 OUTR Stock Chart - 1 M http://t.co/9oXtnF4fLI
Alexander Morris
17 Sep 14 11:13:03
$OUTR: Exc 1DyHIGH=59.80, hits:3, ch:+0.5%, tf:38, LowFlt[16.1M], HiPctSht[35%:10d], DyVol:225T:0.9x:0.4x, DyRng:1.9%:1.4x:0.9x
Alpha Maven Alerts
16 Sep 14 13:13:13
$OUTR, Positive, Yesterday, SD +2.06, #NASDAQ #Industrials
David Tuzzolino
16 Sep 14 06:40:12
Cos w/low EV/EBITDA hard to find. http://t.co/CIBARl2Br6 Screen:EV/EBITDA<5 & m cap<$2 b. Interesting names: $TTWO $AAN $RCII $DF $OUTR $WTI
Analyst Ratings
16 Sep 14 06:09:52
Get the latest news and updates for $OUTR $QURE $CBPX $LADR $TLMR automatically with ARN Daily http://t.co/nSJuDsYidj
Fred J. Damsen
16 Sep 14 03:26:52
#motleyfool #specialreport 12 stocks for '15: $apo $axl $cveo $dcom $dpz $msci $outr $pnc $stmp $veev $xoom $xpo I have no positions in any
Day Trade Alerts
15 Sep 14 08:19:07
via #AlertTrade SHORT Seller Alert $OUTR - OUTERWALL INC #ShortSeller #Stocks http://t.co/VS8RO1bzXJ
14 Sep 14 08:58:00
$OUTR is miraculously prepping for a Breakout here http://t.co/lJPQBcsKx0
Alpha Maven Alerts
14 Sep 14 01:22:42
$OUTR, Positive, Yesterday, SD +2.06, #NASDAQ #Industrials
(Plan Maestro)
13 Sep 14 21:25:58
Is this a non disclosed paid ad for Outerwall? $OUTR http://t.co/mSxyAE4eYE
12 Sep 14 14:38:49
$YELP 67.00, $CLUB 4.17, $GALT 4.78, $LNKD 160.00, $OUTR 53.00, $BAC 15.35. Who banked on these multi-day runners?
Tom Shaughnessy
12 Sep 14 11:25:19
RT @indievestments: @Toms_119 yes, perhaps one should just buy $OUTR to access a similar model but with low capital intensity and cleaner c…
Mike Arnold
12 Sep 14 11:24:34
@Toms_119 yes, perhaps one should just buy $OUTR to access a similar model but with low capital intensity and cleaner capital structure.
Alpha Maven Alerts
11 Sep 14 23:39:33
$OUTR, Negative, Yesterday, SD -4.77, #NASDAQ #Industrials
By  +Follow December 10, 2013 9:47AM



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