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Outerwall Cuts Staff, Nixes Three Ventures as Part of Restructuring

By  +Follow December 10, 2013 9:47AM
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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

Results for OUTR
Ernest Partington
16 Apr 14 23:55:04
$OUTR Outerwall Sees Significant Drop in Short Interest (OUTR) http://t.co/uE0BVRuhii
US Banking News
16 Apr 14 22:56:34
Outerwall Sees Significant Drop in Short Interest $OUTR http://t.co/gxPmBfakKl
Zolmax News
16 Apr 14 22:45:27
Outerwall Sees Significant Drop in Short Interest $OUTR http://t.co/9fDMbolsXV
Dwayne Membrane
16 Apr 14 09:45:37
Doubled up on $OUTR at 65.01
Dwayne Membrane
16 Apr 14 09:11:05
Bought $OUTR b/c it's cheap rt now, there are few sellers, it's likely headed back up to $70+, solid fundamentals
Dwayne Membrane
16 Apr 14 08:41:52
Bought $OUTR at 65.56
Sicarius
16 Apr 14 04:46:18
@marissamayer you should look at $OUTR merger. Streaming video now plus 3 dvd's per month.Very competitive,you can see the relevance.
bwolf
15 Apr 14 07:26:30
quick, everyone out of $OUTR b/c Jana has completed their modern day greenmail campaign. http://t.co/u1YOoFrqzj
HedgeMind
14 Apr 14 15:34:05
Barry Rosenstein of Jana Partners reduced his stake in $OUTR to 4.9% from 8.4% in an amended 13D filing. http://t.co/DiAS43Ax3U
Day Trade Alerts
14 Apr 14 09:54:37
via #AlertTrade SHORT Seller Alert $OUTR - OUTERWALL INC #ShortSeller #Stocks http://t.co/VS8RO0UwVJ
clearTREND Research
14 Apr 14 07:02:22
clearTREND Research DOWNGRADES US Financial Administration Sector $ADS $FLT $FISV $WEX $ADP $OUTR $CASS $JKHY $GPN $PPS $FIS $WAGE $DLX $PA
Diogenes
11 Apr 14 10:53:08
Jana Partners, still "highly supportive" of $OUTR, cuts stake 40%. #ActivismForTheLongTerm
Barbarian Capital
11 Apr 14 07:43:46
RT @bwolf_: $OUTR - LBO available for the common man. Fundies appear to have stabilized & mgmt arbitraging rates 4 shareholders. http://t.c…
Tsachy Mishal
11 Apr 14 07:38:39
@bwolf_ Im surprised you like $OUTR. You usually are on the other side of secular decliners?
bwolf
11 Apr 14 07:37:06
$OUTR - LBO available for the common man. Fundies appear to have stabilized & mgmt arbitraging rates 4 shareholders. http://t.co/tUp84PPix9
Insider Monkey
11 Apr 14 07:13:20
Barry Rosenstein, Jana Partners Continue Reducing Stake In Outerwall http://t.co/nWqqEoRmgh $OUTR
Jerry Khachoyan
11 Apr 14 05:36:11
Good Morning. This Friday's pre-market movers/gappers: $JPM $WFC $NQ $GPS $HRB $WCG $MU $FAST $BOFI $OUTR $VJET $DWCH $RLYP $SDRL
InsiderTradingWire
10 Apr 14 14:35:08
13D Alert for OUTERWALL INC - $OUTR - #13D #insidertrading - http://t.co/ukOhfx9CW6
MarketCurrents
10 Apr 14 13:46:43
Jana lowers Outerwall stake to 4.9%; shares -1.4% AH http://t.co/bVuv5JceO9 $OUTR
Barbarian Capital
10 Apr 14 13:44:57
JANA down to 4.9% in $OUTR
Ritika Goyal
10 Apr 14 13:39:38
Jana Partners reduces $OUTR stake to 4.9%. "Highly supportive" of recent actions taken by the company
whalewisdom
10 Apr 14 13:36:18
New SC 13D/A from JANA PARTNERS LLC concerning $OUTR. See details at http://t.co/OGvMwC6nAj
InsiderTradingWire
10 Apr 14 13:35:08
13D Alert for OUTERWALL INC - $OUTR - #13D #insidertrading - http://t.co/NkYtcnALHi
LoveStockNews
9 Apr 14 14:27:11
$OUTR - The Nasdaqs 3 Most Hated Stocks -> http://t.co/17akAEkcDv #stock #stocks #stockaction
Craig Bujnowski
9 Apr 14 06:53:50
Rental & Streaming Wallet Share $OUTR $AMZN $AAPL $GOOG #ott #redbox #netflix #firetv #appletv #androidtv http://t.co/RamibppXUf
StockNewsNet
9 Apr 14 06:45:13
$OUTR - The Modern Day Recycling Dilemma: How to Safely Sell or Recycle Unwant... -> http://t.co/ksNk4ut0VR #stock #stocks #stockaction
Craig Bujnowski
9 Apr 14 06:44:45
AppleTV + AndroidTV + Amazon Video up 3x y/y = $OUTR the Radioshack of 2015 $AAPL $GOOG $AMZN $RSH #outerwall #redbox http://t.co/hwBBeB3sxY
				
				
By  +Follow December 10, 2013 9:47AM
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