If they haven’t already, Carol Spieckerman says suppliers to Wal-Mart Stores Inc. better figure out how they fit into a new “transmedia” world she thinks will dominate the way large retailers operate in the years to come.

Spieckerman, president and CEO of Bentonville-based Newmarketbuilders, spoke Wednesday (Feb. 13) to more than 60 students, faculty members and media gathered at the University of the Ozarks in Clarksville.

Her topic, “The Transmedia Transformation: How Retail Will Drive a Decade of Disruption,” was a synopsis of how the intersection of technology and social media has and will continue to change the way retailers connect to and interact with consumers.

The Distinguished Speaker Series at the UofO was sponsored by enactus and Phi Beta Lambda.

“Retailers are leading the charge in terms of new thinking” about how to harness technology and social media, Spieckerman told the crowd. “And this is a fairly recent development.”

Retailers are, according to Spieckerman, focused on building “platforms” that include numerous methods to recruit and retain customers, while building positive brand awareness. The platforms include connections between social media, television, video, digital advertising, in-store marketing, and numerous other venues that deliver a product and/or brand message.

“Platforms are the base for the coming transformation,” Spieckerman said, noting that Stephen Quinn, chief marketing officer for Walmart U.S., has said his goal is to create an “experience platform” for Walmart shoppers.

CREATING ENGAGEMENT
Where once it may have signaled the end of a career for a designer to work with a discount store like Wal-Mart, top-name designers are more comfortable joining a broad retail platform because of the intrinsic value of increases market reach. For example, Wal-Mart can connect more than 200 million households and 3,600 stores with a broad platform that magnifies its overall reach. The big designers want to be part of that.

“Cartons of milk are now driving designer sales,” Spieckerman said.

One of the purposes of a platform is about creating an “engagement rather than a transaction,” Spieckerman said, suggesting that the retailer creating a richer information environment will eventually generate more interaction – sales – with the consumer. The goal of a platform, she noted, is to keep people contained within the platform.

Also, and possibly most important, the various parts of the platform generate data about a person’s interests. Those interests are, according to Spieckerman and other retail watchers, more indicative of future purchases than their past purchasing behavior.

This “big data” is then fed back into the platform to further the connection between retailer and consumer, Spieckerman said.

The use of platforms and technology have also created what Spieckerman calls a “clicks to bricks” business model. With this model, retailers first open an online presence  to test products and processes, measure consumer interest, interaction and other behaviors. With that data, they then open physical locations.

CONTENT IS KING
Part of a platform includes sales and marketing content that goes far beyond the traditional public relations jabber. Content in the new platform must be more of a story or other presentation device about products and branding that doesn’t come across as traditional commercial.

“Content right now really is the new currency. ... And there is an insatiable demand for content,” Spieckerman said, adding that the demand is growing fast for content that speaks to brand “quality, quantity and diversity.”

She said retailers are looking for journalists, English majors and others with strong writing and research skills who are capable of creating content that creates an experience instead coming across as a sales pitch.

In an interview after her remarks, Spieckerman said suppliers to Wal-Mart interested in supporting the retailer’s transmedia shift “may want to take a step back and look at the big retailers and see where their best position is on the platform.”

For example, relationships are now somewhat isolated between vendors and Wal-Mart buyers, and turnover among buyers doesn’t help, she said.

To avoid being solely at the mercy of a buyer, Spieckerman suggested a supplier “form relationships in the new roles” by finding ways to collaborate with Wal-Mart to maximize one or several points within the platform. That could include working more directly with Wal-Mart on a social media campaign, she said.

We expected it to happen and the backlog of foreclosure filings stuck in the pipeline is flowing once again across the Natural State sending delinquency filings higher to start 2013.

Mortgage delinquency activity rose 270% in Arkansas from January 2012 as 1,016 households faced foreclosure to start 2013, according to RealtyTrac.com.

Last month there were 218 new filings in Benton and Washington counties and the local foreclosure pace rose 98% compared to January 2012. But real estate agents say the numbers are still very manageable and much lower than the foreclosure peak in 2009 and 2010.

Benton County reported 121 new filings in January, 89 of which were set for trustee sales and 32 listed as bank-owned real estate just out of the foreclosure pipeline. The notice of trustee sale is the midway point in the foreclosure process and this metric was 13 times higher in January than in the previous year. 

Washington County reported 97 new foreclosure filings, up 155% from a year ago. Some 68 of those delinquencies were set for trustee sale in the coming weeks, this compared to just 11 in the year-ago period.

The same pattern was true for Sebastian and Crawford counties, while the overall numbers are considerably less.

Sebastian County reported 32 new filings in January, up from 5 in the year-ago period. The majority of the new filings -- 28 of them -- were midway through the foreclosure process as set for auction in the next two months.

In Crawford County there were 39 new filings, 18 of which are set for auction and 11 that have already been recovered by banks and will soon be listed for sale.

Realtors have been closely monitoring the levels of foreclosures coming back into the local market.

Jim Long, agent with Crye-Leike Real Estate in Bentonville, said there are 257 bank-owned properties noted in the Multiple Listing Service which includes Northwest Arkansas and the Fort Smith market.

This so-called distressed inventory totaled 260 in December, according to Long.

“The property is coming under contract about as quickly as it hits the inventory, at or near asking price,” Long said. “Buyers include investors and consumers wanting to purchase while interest rates are low and prices are starting to edge upward.

Andres Carbacho-Burgos, housing analyst with Moody’s analytics, said as the foreclosure backlog makes its way into the marketplace, there will be some downward pressure on home price appreciation across Arkansas, particularly in the Fayetteville metro area where there is a larger shadow inventory to be worked out.

According to Equifax, Cabacho-Burgos says the Fayetteville metro area has a 3.7% mortgage delinquency rate -- 90 days past due or more. This compares to 3.1% in the Southern region and 3% in the state as a whole.

He said it remains to be seen how much impact this will have on prices. It will depend on how many of the home sales in 2013 are distressed properties compared to non-distressed sales. In many regions of the country there is sufficient investor activity to offset this negative price impact.

“One thing is for sure, the shadow and distressed properties do have to be come out of foreclosure and be sold again before markets can resume normalized price gains, Cabacho-Burgos said.

On the national scene U.S. foreclosure starts were down 28% from a year ago, the lowest level since June 2006, according to RealtyTrac.com.

Carbacho-Burgos said some states are recovering faster than others and Arkansas is a laggard state because of the court ruling that stalled foreclosures late in 2011 and part of 2012. 

Among non-judicial states Arkansas posted the largest increase in foreclosure starts in January, up 539% from a year ago.

The state of Washington had an increase of 179% while Nevada’s foreclosure starts rose 87% year-over-year.

January Foreclosure Filings
Northwest Arkansas
Benton County
2013: 121
2012: 72
one in 760 households

Washington County
2013: 97
2012: 38
one in 892 households

Fort Smith Area
Sebastian County
2013: 32
2012: 5
one in 1,696 households

Crawford County
2013: 39
2012: 2
one in 889 households
Source: RealtyTrac.com

The Greater Fort Smith Association of Homebuilders will hold its 54th Annual Home Show, February 22- 24 at the Fort Smith Convention Center in downtown Fort Smith.

The show is open Friday (Feb. 22) 2 to 8 p.m., Saturday (Feb. 23) 10 a.m. to 7 p.m. and Sunday (feb. 24) Noon to 4 p.m.

According to a statement from the Association, homebuilders and remodelers attending the show will provide information on the following items.
• “Green” building technology
• Building and remodeling contractors
• Carpet, tile, wood flooring, stone masonry
• Granite and marble counter surfaces
• Windows, window treatments, and decor
• Custom wood work, kitchen cabinets
• Safe rooms, siding, and recycling plans
• Fireplaces, stoves, and insulation
• High efficiency heating & cooling systems
• Fencing, security systems, pest control
• Concrete finishing, sun rooms, satellite systems

Cooking and cutlery demonstrations, home automation, energy efficiency tips and tricks, decorative home accessories and more also will be featured at this year’s show.

The show will also feature energy seminars with energy expert Doug Rye. The seminars will be Friday at 6 p.m. and Saturday at 4 p.m., and are sponsored by Arkansas Valley Electric Cooperative.

Admission for adults is only $5 and children are free.

Jim Moore recently joined Liberty Bank’s Northwest Arkansas division as assistant vice president of lending, according to D. Scott Hancock, executive vice president-lending/chief lending officer.

With more than seven years of banking experience, Moore has served as a loan officer, loan coordinator, and an operations specialist.

“We’re very pleased to have Jim as part of the growing Liberty Bank team,” Hancock said. “His focus on customer service and energy are great assets that Jim brings and will lead to developing many successful banking relationships.”

Moore earned bachelor’s and master’s degrees from the University of Arkansas and is active in several community organizations. He has served as treasurer, secretary and committee chair for Washington County Ducks Unlimited and an active member of the Fayetteville Sequoyah Kiwanis club. This year Moore is taking part in the Chamber of Commerce Leadership Fayetteville.

He works in Springdale at the 3395 West Sunset Ave. banking center.
 

Also this week, Liberty Bank promoted Chris Queary to branch coordinator for Liberty Bank’s Bentonville banking center, according to Joe Spivey, community bank president.
                                   
A Rogers native, with more than 10 years of banking experience, Queary most recently served as head teller and financial services representative.     
   
“We are pleased to acknowledge the outstanding leadership role that Chris plays at Liberty Bank,” said Spivey. “His experience and pride in his work make him a perfect fit as branch coordinator.”

Queary and his wife, Becky, have one daughter, Mikayla.

Jonesboro-based Liberty Bank of Arkansas has assets exceeding $2.8 billion, has 46 banking centers in 24 communities throughout the state.
 

Health Management Associates saw its full year revenue rise by more than 15%, but net income for the year came in at $164.27 million, down 8% compared to the previous period.

Naples, Fla.-based HMA is the parent company of Sparks Health System in Fort Smith and operates Summit Medical Center in Van Buren. When the deal is finalized to bring Bayfront Health System (St. Petersburg, Fla.) into the system, HMA will operate 71 hospitals with approximately 11,000 licensed beds in “non-urban communities” in the U.S.

Net revenue – total revenue reduced by the provision for doubtful accounts – for the fiscal year was $5.87 billion, above the $5.08 billion in the previous fiscal year. The full year per share earnings of 64 cents fell below the 81 cents that was the consensus estimate of analysts.

For the fourth quarter of the fiscal year, the hospital holding company posted $1.48 billion in net revenue, up over the $1.388 billion in the 2011 fourth quarter. Fourth quarter net income was $48.28 million, well ahead of the $30.847 million in the 2011 period.

Fourth quarter per share earnings of 19 cents beat the consensus estimate of 18 cents per share.

"Our 2012 results reflect both a challenging and successful fourth quarter and year. I am very proud of and thankful for the efforts of our physicians, nurses and health care professionals, whose hard work and dedication to delivering the best possible care are the reasons for our success," Gary Newsome, HMA president and CEO, said in a statement. "While we are pleased with the overall results, we also recognize that there are always areas and processes that can be improved. As such, we will continue to focus on our patient-centered approach, cost management and partnership opportunities, while taking important strategic steps we believe will better position Health Management for continued success going forward."

Key points of the earnings statement released Thursday (Feb. 14) afternoon include:
• Same hospital net revenue increased 5.1% to $1.459 billion;
• Same hospital net revenue per adjusted admission increased 5.2%;
• Same hospital surgeries and emergency room visits increased 0.9% and 9.2%, respectively;
• The company’s fourth quarter provision for doubtful accounts was $234.6 million, or 13.7% of net revenue before the provision for doubtful accounts, compared to $195.1 million, or 12.3% of net revenue before the provision of doubtful accounts, for the same quarter a year ago.
• The “Uncompensated Patient Care Percentage” was 28.7% for the fourth quarter, compared to 25.4% for the 2011 fourth quarter a year ago, and 29% for the 2012 third quarter.

Also, the company’s cash position fell during 2012. Cash and cash equivalents for HMA totaled $59.173 million as of Dec. 31, 2012, down from $64.143 million at the end of 2011.

Shares of HMA closed Thursday at $10.70, down 2 cents. The earnings report was released after the markets closed. During the past 52 weeks, the share price has ranged from a $10.79 high to a $5.92 low.

Alma-based InvoTek Inc. recently received a Phase I Small Business Innovation Research grant from the National Institutes of Health.

The grant will fund the creation of a tool enabling children and adults with disabilities to enter texts up to 64% more efficiently than with existing tools. The gesture product is a collaboration of InvoTek and researchers at the Madonna Rehabilitation Hospital in Lincoln, Neb.

“Approximately 7 million children and adults in the United States have disabilities that hinder their ability to communicate,” Tom Jakobs, InvoTek president, said in a statement. “These disabilities include spinal cord injuries, cerebral palsy, muscular dystrophy, ALS, multiple sclerosis, stroke, and Guillain-Barre syndrome. This software gives them a simple way to enter text into a computer or speech generating device without requiring precise muscle movements.”

The gesture product, unlike current “swipe” technology, uses software that allows the user to enter partial words and then predicts and completes the word for them. People with disabilities who used early prototypes were highly satisfied and reported a significant reduction in effort needed to complete a writing task.

Founded in 1988, InvoTek specializes in applying technology to the needs of people with severe disabilities. InvoTek is a founding sponsor of Be Extraordinary, a non-profit organization that identifies people with severe disabilities who want to accomplish a life goal.

Hundreds of millions of dollars are flowing through the construction industry in Northwest Arkansas and the Fort Smith area and it’s all thanks to the growing needs at higher education institutions.

All of the major local college and universities have either recently complete, ongoing, or upcoming construction projects.

The most recently announced project is at John Brown University in Siloam Springs. JBU announced on Feb. 12 that the 93-year old men’s dormitory J. Alvin Brown Residence Hall would receive a $5.5 million renovation. A $3 million anonymous lead gift was announced at the time of the renovation announcement. Construction is expected to begin this summer and be completed by summer 2014. The facility has been enlarged or renovated several times in its nine decades.

“We're excited we will be able to continue the legacy of this historic building. We hear often from our alumni about the great memories and lifelong friends made when living in J. Alvin," said Dr. Jim Krall, vice president for advancement. “I am thankful that part of this lead gift is a matching opportunity for $1.25 million that will encourage alumni and friends of JBU to give the remaining funds needed to complete the project.”

According to Steve Beers, vice president for student development and facilities, there are several more ongoing projects on campus including:
• Simmons Great Hall, which is a 17,000 square foot dining and banquet facility that will be completed in 2013 at a cost of $5 million;
• North Slope Apartments, which are two, 10,000-square foot apartment buildings that will be a residence hall for 92 students. This project should be complete in summer of 2013 and cost $3 million; and,
• Care Clinic, which is a 2,500-square foot counseling and office space for the graduate counseling program. Also scheduled to be complete this summer, the project’s cost is $300,000.

RECENT COMPLETIONS, NEW STARTS
Not that it’s a competition, but two institutions of higher education were neck and neck when it came to finishing projects on their campus. Students at Harding University’s Northwest Arkansas Professional Center were able to move into the center’s new building on Jan. 28. The $3.1 million building has 12,000 square feet of office, classroom and meeting space. This is the first time Harding has had a permanent building in the region.

NorthWest Arkansas Community College recently opened its new health professions center, which is a $14.2 million, 83,000-square foot facility that serves students in the growing health professions division. Jim Lay, director of facilities and construction management, said there are only minor changes to be done on the building now that it’s complete.

The National Child Protection Training Center is one of the next projects to commence with a $3 million renovation project. The college is turning the old Highlands Oncology building into a state-of-the-art training facility dedicated to stopping child abuse. It will have a mock house, computer lab, classrooms, interview rooms and several court rooms. Meetings are scheduled to start with Nabholz Construction soon for the project and it is expected to take eight months to complete.

NWACC is still planning to build a permanent facility in Washington County, according to a report from Steve Gates, senior vice president for learning and provost. The college has a location chosen and is in working with local stakeholders as plans progress.

LEARNING AND ENERGY
At the University of Arkansas at Fort Smith, there are two major projects going on including a $14.5 million library and renovation and constructing a new central energy plant.

Darrell Morrison, vice chancellor of finance, said the library project should be complete late spring or early summer.

“We had an older library facility that was built when we were a community college,” he said, adding that more lab space and room for more resources is necessary now that UAFS is a four-year university. When finished, the library will be twice the size of the original and will include a center for business enterprise.

“Included in the expansion is approximately 11,000 square feet of space on the second floor, funded in part with a $2 million grant from the Department of Commerce,” noted UAFS spokesperson Sondra LaMar. “This area is dedicated to community and business development under the terms of the grant and will include the newly established Babb Center for Student Professional Development and will house the Family Enterprise Center, which focuses on creating and growing multi-generational businesses.”

Morrison said the other building is a $1.7 million central energy plant and the corresponding new cooling and piping system that is an additional $2.1 million cost. This project should be done in August.

“It is to save energy and costs,” he said. “The payback on this project is 10 years from energy savings.”

BIGGEST VARIETY
Not surprisingly, the largest local campus also has the biggest variety of projects. The University of Arkansas has 168 projects on the books right now, totaling $530 million.

Some of those are minor repairs or cleanup projects. Others, however, are major renovations or additions, or new construction.

The list of renovations, additions and new construction includes:
Renovating and adding on to John A. White, Jr. Engineering Hall
Faulkner Performing Arts Center (old gym turning into a performance arts hall)
Founders Hall (residence hall)
Housing Office
Vol Walker Hall addition and renovation
Ozark Hall restoration and honors wing addition
Hillside Auditorium (replacing science and engineering auditorium)
Football center
Lambda Chi Alpha Fraternity restoration and addition
Pi Kappa Alpha Addition (renovation and addition)
Yocum Hall renovation
Hotz Hall renovation
Basketball practice facility
Athletic academic and dining Facility
Baseball and track indoor training facility
Leroy Pond Utility Plant
Classrooms and teaching labs
Mechanical engineering building renovation

Stronger home sales kicked 2013 into action last month as real estate agents in Benton and Washington counties sold 366 homes, the best start in five years, according to MountData.com.

January home sales totaled $61.33 million, up 13.43% from a year ago. Median home prices rose nearly $10,000 from a year ago to $139,950 in January.

The majority of homes sold last month were priced in the $100,000 to $150,000 range, and there is 5-to 6-month supply of homes in this price category.

Vickie Briolat and Jim Long, agents with Crye-Leike Realty in Bentonville, together have 14 homes under contract since Jan. 1.

“We are incredibly busy,” Long said as he was showing a home in Fayetteville on Wednesday (Feb. 13).

The City Wire caught up with Briolat Thursday (Feb. 14) during a home inspection for a deal that is about to close.

“Everyone in our office is running full blast, the phone is ringing, homes are selling and it’s the best start I can remember. We are just surfers riding this wave and we hope the tide stays high,” Briolat said.

Agents say the business is mixed between those selling and moving up as well as those buying investor properties and taking advantage of the low interest rates, which were a 3.46% average in January, according to MountData.

Paul Bynum, statistician with MountData, reports an ending inventory of 3,135 homes listed for sale in January. That included 313 new construction homes and 2,822 existing homes. Inventory is down 57% from the all-time high in August 2007, and 11% lower than a year ago.

“Our January closed business was about 20% higher than January 2012. We are still in the slower winter season (for residential business); but If January is a decent indicator, 2013 will result in a healthy increase in sales,” said George Faucette, CEO and co-owner of the local Coldwell Banker franchise.

Faucette said he is equally convinced that home price increases will moderate as more foreclosures make their way into the listing service.

Bynum reports 548 pending home sales in January, up from 445 in the year-ago period. He said the higher pending number is a leading indicator for future sales. There were also 818 new listings in January, up from 745 new listings a year earlier.

Long said new listings are coming under contract faster and properties priced right and show well are getting full price offers or near full price; as well as multiple bids in some cases.

The average time on market for homes sold in January was 54 days, according to MountData.com.

January Home Sales
Benton County
2013: 217 units, totaling $38.204 million
2012: 201 units, totaling $33.42 million

Washington County
2013: 148 units, totaling $22.857 million
2012: 140 units, totaling $20.646 million

Median Home Prices
Benton County
2013: $140,500
2012: $137,950

Washington County
2013: $137,950
2012: $130,500

Tyson Foods has purchased Don Julio Foods of Clearfield, Utah, to compliment the meat company’s tortilla business -- Mexican Original.

Donnie Smith, president and CEO of Tyson Foods, said the deal is an example of the company’s overall growth strategy.

Tyson spokesman Gary Mickelson said the financial terms of the deal are not being released.

Don Julio, a maker of flour and corn tortillas, and salty snacks such as potato chips, tortilla chips and pretzels, sells products to retailers throughout the U.S. under the Don Julio Authentic and Clover Club brands.
 
Tyson Mexican Original is the second largest manufacturer of tortillas in the U.S. and majority of its sales are with foodservice customers. However the acquisition will put the company’s products on grocery store shelves throughout the U.S.

“Don Julio is an example of a brand that’s the right fit for Tyson Foods,” Smith said. “The people are great, the business expands on an existing tortilla business where we already have expertise and it will allow us to offer our retail customers another product with a loyal consumer following.” 
 
The management team – which includes Nate Fisher, son of company founder, Craig Fisher – will continue to manage the operation. Don Julio employs about 50 people, the majority of whom are expected to become Tyson employees.
 
The acquisition includes all brands marketed by Don Julio, equipment and related assets. Financial terms of the deal are not being disclosed.
 
Entrepreneur Craig Fisher created Don Julio Foods in 1994 as a line of chip, tortilla and dip products. Production was outsourced until 2002 when Fisher and his son opened the tortilla manufacturing plant in Clearfield. Soon after beginning to make their own products, the company acquired Clover Club Foods, the same company where Craig Fisher began his career in the food business the 1980s. Most of the company’s salty snacks are marketed under the Clover Club brand. Don Julio and Clover Club products are distributed nationwide at national and regional retail grocery stores.
 
Tyson Foods purchased Mexican Original, Inc. in 1983 to diversify its product offerings. Prior to the Don Julio acquisition, the company operated three dedicated tortilla operations in Fayetteville, Portland, Ind., and Sanford, N.C. Mexican Original tortillas and chips are sold to foodservice and restaurant customers. About 1,300 Tyson employees work for Mexican Original.
 
“We are excited to have the Don Julio folks join our Tyson Foods team,” said Richard Irvin, manager of operations for Mexican Original. “We look forward to working with them and helping them grow the Don Julio and Clover Club brands.”

Single, white, middle-aged men account for the majority of homeless people in Northwest Arkansas, according to a recent census, but women with children are the fastest growing segment of the homeless population.

Findings from the 2013 Northwest Arkansas Point-in-Time Homeless Census, conducted by the University of Arkansas’s Community and Family Institute, were released Thursday, two weeks after the Jan. 31 count was made. It was the fourth biennial count of the region’s homeless.

Some 63% of the area’s homeless are male, 80% are white, 66% are single, and the median age is 43 years old, mirroring the 2011 demographic profile.

Two-thirds were single, a slight increase from the earlier census. The number of adults who said they were either a single parent or part of a two-parent family with children declined from 26% in 2011 to 20% this year. However, that number reflects only those people personally interviewed during the census taking.

The general population of Northwest Arkansas has grown at 6.5% while the homeless population grew 42% between 2007 and 2011, according to the biennial censuses.

INVISIBLE PARENTS
“If you look at the numbers of ‘invisible’ parents – as reported in the school numbers – that number is overwhelming,” said UA sociology professor Dr. Kevin Fitzpatrick, director of the Community and Family Institute. The increase in women with children is not unique to Northwest Arkansas. “I think that if you look at the statistics nationwide, most places are experiencing that kind of shift,” he said.

The “invisible” parents to which Fitzpatrick referred comes from data reported by Washington and Benton counties’ 14 public school districts. Some three-fourths of those students listed as homeless are doubled-up with friends or relatives. Because those students have temporary shelter in others’ homes, they’re not readily seen by other citizens as homeless.

They also are harder to identify and count than someone living in a shelter or on the streets and are sometimes called the “invisible homeless.” The homeless census took those students into account, and added one parent for every two children, except for the 34 children who were reported as “unaccompanied.” Those unaccompanied students reported living without a parent or guardian.

About half of the area’s homeless population is enrolled in kindergarten through 12th grade. Schools in the two counties reported 1,175 students as homeless. Bentonville schools had the highest number of homeless students with 294. The Fayetteville School District logged the second-highest number with 192 homeless students.

“As the country slowly recovers from the the most significant economic downturn since the Great Depression, the number of homeless in Northwest Arkansas increased from an estimated 2,001 in 2011 to 2,429 (18% increase) in 2013. The rise is alarming, but not surprising as service providers throughout the region continue to report record numbers of persons being served,” the census report says.

FIRST TIME HOMELESS
Thirty-five percent of the homeless interviewed in January said they lived in emergency or transitional shelters. Those are the people who are easiest to identify as homeless.

“Roughly one-quarter of all adults interviewed said they were doubling up with friends/relative; this invisible homeless has in part been the carry-over from an economic crisis that continues to have a profound impact on the American family. This group of ‘invisible’ homeless continues to be both an enigma and challenge to service providers in the region and throughout the country,” the report states.

In another sharp shift, more and more homeless people – about 75% – reported being homeless for the first time, rather than part of the chronically homeless population.

“I think it would correlate with us not being out of the woods yet with our economy,” said Jon Woodward, executive director of 7Hills Homeless Shelter. “The job market for those who don’t have vendor-type or Walmart-oriented skills can be a tough job market. It’s not a case of being generationally impoverished. ... It really suggests it’s a new face of homelessness in our region.”

In 2007, more than half the people interviewed, 52%, said that was not the first time they had been homeless. This year, only 25% reported being homeless multiple times within the past three years.

MENTAL, PHYSICAL ISSUES
Fitzpatrick previously said many people moved to the region by the lure of good jobs, but when the economy crashed a few years ago, many of those people lost their homes and jobs. Many have stayed in the area trying to recover, he said.

Some 73% of the homeless people interviewed in January reported suffering from at least one of five conditions the Department of Housing and Urban Development says contribute to chronic homelessness: substance abuse, mental illness, physical disability, domestic violence and developmental disability.

Those reporting substance abuse declined sharply, from 43% in 2011 to 25% this year. But the number of homeless who self-reported suffering from mental illness jumped from 28% to 46%.

Woodward said that increase is no surprise to those who work with the homeless or to mental health providers in the region.

“There are so many cuts to funding for adults. They (mental health providers) are doing the best they can with the resources available. There have been across the board cuts to adult mental health,” Woodward said.

Physical disabilities were reported by 33% of those interviewed, an increase of 6% from 2011 when only 27% listed that as a problem.

Those reporting domestic violence declined from 15% in 2011 to 12% this year. The number with developmental disabilities dropped even more, from 9% to 4%.

TRANSPORTATION, MEDICAL SUPPORT
About 20% said they need help with transportation and medical assistance, 18% see a greater need for first aid services, 26% want more housing placement services, and 23% need help making a deposit for housing or services. However, the percentage of homeless who need the services is lower than it was in 2009 and 2011.

But Woodward said that statistic is misleading. The overall percentage may be down, but the numbers being served are greater. For instance, Woodward said when he first came to 7Hills in 2007, the organization served 645 people. Last year, it served 3,900 people.

“It’s a challenge to keep up with the growing need. Growth has outstripped our ability to keep up with it,” Woodward said.

Julie Bachmayer, social worker for the Bentonville School District, said more options for job assistance and transportation would benefit the homeless families she works with. Transportation also is vital for medical visits, or to attend necessary treatment or therapy for families dealing with substance abuse, one reason many families find themselves homeless.

About 78% of the respondents said they needed medical care, while 67% said they had received medical care. However, the disparity between the need for dental care and receiving it was much greater, 62% to 16%, respectively.

Woodward stressed the importance of the homeless census and said most of the new services resulted from the census data and the service gaps it has revealed over the years. He urged continued support for non-profits that deal with the homeless population.

“I think the community has a responsibility to support those centers because the need is growing,” Woodward said. He also encouraged people with professional skills, especially in counseling and mental health services, with a heart to help the homeless to volunteer.

Business and community leaders from across the Fort Smith area gathered Friday afternoon for the 125th annual meeting of the Fort Smith Regional Chamber of Commerce.

Mike Callan, the chamber's 2012 board chairman, said the previous year had been one of challenges and resilience for the area.

"Fort Smith has seen its fair share of bad news," he said. "Every time, the chamber rises to the occasion."

Callan said the work of the chamber and its members had made a difference in the 188th Fighter Wing continuing to be a vital part of the community.

"We all know the results now," he said. "That's a glass half full."

Callan also referred to expansion projects across the business community as an accomplishment.

"Thirty industrial expansion projects (were undertaken) and 400 new jobs were created," he said.

In material distributed to individuals attending the meeting, the chamber listed a wide variety of other accomplishments during 2012. Highlights include:
• 146 new or expanding retail and service sector businesses;
• $52.3 million of capital investment in retail and service businesses;
• $38 million of capital investment in healthcare;
• 1,100 new jobs created through regional expansion projects;
• $57 million of capital investment in regional expansion projects; and,
• hosted 228 networking events and meetings with more than 11,000 participants.

The material also highlighted the 2012 Regional Business Expo, which showcased 78 businesses to over 600 attendees, and the Careers for our Regional Job Fair, which saw 850 job seekers and 80 employers participate.

The meeting's keynote speaker was Dr. Don Bobbitt, president of the University of Arkansas System.

Bobbitt highlighted challenges and change in higher education, including the University of Arkansas at Fort Smith.

"We're at a fork in the road," Bobbitt said, explaining that the higher education industry could continue doing things the way it has been done during the last 1,000 years or it could adapt and change as society and business has changed.

He said higher education and business both must realize that competition is no longer limited to the region or nation in which it finds itself.

"Our competition doesn't exist regionally, it's across the world," he said. "The rest of the world will catch up to us."

Arkansas Gov. Mike Beebe and other governors across the United States understand this, Bobbitt said. In order to stay competitive, Bobbitt said Beebe has challenged the state's colleges and universities to double the state's number of degreed adults.

"If we double the number of  degreed Arkansans, we will have 52% (of adults) with some sort of post-secondary education," he explained.

To meet the challenge, Bobbitt said he and other leaders in higher education are thinking outside the box.

"You're going to see online become an important part of our portfolio," he said.

Bobbitt said the UA System must combine quality education with access to education, something he said UAFS had done quite well.

Even with the new challenges, Bobbitt said he was bullish about the future of higher education and the state's economy.

"I think new technologies will change the way we go forward," he said. "I have no doubt we'll be successful."

A Friday (Feb. 15) afternoon revelation that February sales for Wal-Mart Stores could hit lows not seen in seven years sent company shares on a brief dive before recovering to only lose 2.15% in trading.

Bloomberg News obtained a memo from Jerry Murray, Wal-Mart vice president of finance and logistics, saying the February month-to-date sales were a “disaster.”

“In case you haven’t seen a sales report these days, February MTD sales are a total disaster,” Murray noted in a Feb. 12 e-mail to other executives, according to this report from Bloomberg.

Continuing, Murray wrote: “The worst start to a month I have seen in my ~7 years with the company.”

Shares of Wal-Mart (NYSE: WMT) closed Friday at $69.30, down $1.52. During the past 52 weeks the share price has ranged from a $77.60 high to a $57.18 low.

A Wal-Mart spokesman suggested the Murray e-mail may lack context, thus not presenting an accurate assessment of February sales.

“As with any organization, we often see internal communications that are not entirely accurate, that lack the proper context and represent individual opinions,” noted the Wal-Mart statement sent to The City Wire.

Context may appear Thursday (Feb. 21), when Wal-Mart releases fourth quarter earnings. The consensus among analysts watching Wal-Mart is that the retailer will post per share earnings of $1.57, which would top the $1.44 per share earned during the same quarter of the previous fiscal year.

The consensus revenue estimate for the quarter is $128.82 billion.

Retail sales are off to a slow start in 2013.

According to the National Retail Federation, January retail sales (excluding automobiles, gas stations and restaurants) increased 0.3% seasonally adjusted from December and increased 5.4% unadjusted year-over-year.

“Today’s retail sales figures continue to indicate a stable yet fragile economy,” NRF President and CEO Matthew Shay said in a statement. “Consumers are continuing to hold back on spending just as our economy is held back by political brinkmanship in D.C.”

Many retail sector watchers have said returning the Social Security portion of the payroll tax to its 6.2% rate – up from 4.2% – will hurt middle and lower income families who are typically the bulk of shoppers at Wal-Mart and other discount stores.

The tax shift is estimated to cut $1,000 in income from a family earning $50,000 a year. The so-called payroll tax reduction was made two years ago to boost spending by putting more money in the pockets of consumers.

With state lawmakers contemplating a $125 million bond program to advance a $1.1 billion steel mill project in northeast Arkansas, a competitor is quietly pushing back at the capitol by raising concerns about the investment group supporting Big River Steel.

Last month, Gov. Mike Beebe (D) and economic officials unveiled the state’s first superproject, which will be located near Osceola (Mississippi County). The billion-dollar steel manufacturing factory, led by steel magnate John Correnti and a group of investors, is expected to employ 525 workers with an average pay of $75,000.

Construction jobs and ancillary or supplier businesses are expected to contribute thousands of more jobs in the coming years.

The bond issue being studied by Arkansas legislators includes a $50 million loan to the company, which is required to be repaid, and $75 million in incentives provided by the state.

As early as Monday or Tuesday, House Speaker Davy Carter, R-Cabot, says he expects to put out a legislative bid for an independent analysis of the state’s review of the project. That process would trigger a 20-day window to create a separate analysis of the superproject deal. Carter said at least four groups have expressed interest in the review bid.

Ultimately, state lawmakers will have to vote the bond issue up or down – a likely “make or break” decision for the steel mill project.

NUCOR’S PERSPECTIVE
Nucor Corp., which has two major steel factories (Nucor-Yamato and Nucor-Hickman) in Mississippi County, has reservations about Big River Steel. It clearly sees the project as competition for market share, materials, labor, and infrastructure.

Nucor representatives have disseminated documents to Arkansas lawmakers that indicate the Big River Steel Mill could be much more competitive with its Nucor-Hickman plant than has previously been disclosed.

Big River officials said there could be a 20% overlap in business with Nucor, but Nucor suggests that based on an air quality permit filing the competition could be 100% competitive.

“Big River project will be able to make 100% of what Nucor Hickman currently makes,” one document stated. “Nucor Hickman currently operates at 70% capacity and has been in that range since 2008.”

TARGET: CORRENTI
In other documents shared with legislators, news articles involving failed John Correnti projects are highlighted, including two projects in Mississippi, one in Ohio and one in North Carolina.

Those projects involved major capital investments, promises of big jobs, and state incentives to partner with the venture capital deals. In most cases, private financing fell through and it is unclear how much state money was spent, although some government money was laid out for infrastructure improvements.

While the Nucor documents highlight several Correnti setbacks, he has had plenty of success.

His steel career began in 1969 with U.S. Steel where he served in construction management activities until 1980. He’s also done stints at the helm of SeverCorr, SteelCorr and Birmingham Steel.

As president of Nucor Corp. from 1991 to 1999 and CEO from 1996 to 1999, he was instrumental in the growth and success of the company’s two Arkansas facilities.

His departure from Nucor and subsequent stints at other competitors has led to considerable friction between Correnti and his former employer, but there’s no denying that in steel circles Correnti is viewed as a formidable player.

IMPACT TO NUCOR
Another page being distributed offers bullet points on how the Big River Steel project could affect Nucor operations in northeast Arkansas.

“Arkansas taxpayers and existing steel workers will pay for an unnecessary project,” it states.
The one-pager outlines “resource concerns,” which include:
• Poaching Nucor talent
• Shortage of talent and skilled labor
• Scrap availability and pricing
• Energy supply/prices
• Availability of rail cars and cost of rail service

Another page highlights Nucor’s 25 years of investing in Arkansas. From 1987-2012, Nucor says it has invested $1.9 billion in Arkansas and that it is planning to invest another $138 million in 2013. Last summer, Nucor said it would invest $115 million in its Nucor-Yamato plant in Blytheville.

A request for comment from Nucor officials was not returned.

MARKET FORCES
Part of the document distribution includes talking points surrounding a failed ThyssenKrupp AG steel mill in Alabama. The 2008 $4 billion deal was a victim of the recession, according to many analysts. It also incurred significant cost overruns, which other documents in circulation suggest happened with unfinished Correnti projects.

One page also discusses the global steel industry and the new mill’s viability. It says that excess capacity is a main risk factor facing steel producers in the current environment.

“Globally [there are] 542 million metric tons of overcapacity in 2012 and it will be even higher in 2013,” according to a December 2012 Organization for Economic Co-operation and Development (OECD) report.

“It will take 5-7 years to work off the surplus capacity,” OECD said.

When the Big River Steel mill project was announced, officials declared that the $1.1 billion factory would produce steel for the automotive, oil and gas, and electrical energy industries.  They also suggested that some of the markets Big River is aiming to compete in is in need of more supply.

An investment group analysis prepared by Delta Trust and Bank for the Arkansas Teachers Retirement System suggested Big River could be positioned uniquely in the market.

“The U.S. is a net exporter of scrap, indicating a scrap shortage is unlikely in the near future,” the Delta Trust report said. “The Big River Steel Mill is expected to be the only mini-mill in the U.S. capable of producing certain grades of steel.”

On Friday, the state of Texas announced that steel pipe manufacturer Tenaris would locate a $1.5 billion plant in Bay City, Texas. Gov. Rick Perry (R) used $6 million from his state-equivalent quick action closing fund to seal the deal, which was promoted as providing seamless industrial pipes for the oil and gas industry.

The Tenaris project appears more likely to be a competitor to Little Rock’s Welspun Pipe facility and could be a new outlet for the type of steel Correnti’s Big River Steel mill will produce.

Officials with USA Truck announced Monday (Feb. 19) that John Simone, 51, will be the company’s new president and CEO, with former CEO Cliff Beckham, 41, to become the executive vice president and chief financial officer.

An executive shift has been long rumored for the financially struggling Van Buren-based trucking company. With approximately 500 employed at the corporate headquarters, the company’s future is a concern to many in the area.

Full-year financials released Jan. 31 showed a $17.54 million loss for 2012, marking four consecutive years of losses.

USA Truck posted a 2011 net income loss of $10.77 million, more than triple the loss during 2010 and in a year when other trucking companies began to see improved financials. Also, 2011 marked the third consecutive year of losses for USA Truck. In 2010, the company reported a loss of $3.308 million, and a $7.177 million loss in 2009.

USA Truck was forced in August 2012 to obtain a new line of credit during the third quarter of 2012 after violating covenant agreements with the previous credit arrangement. Poor national freight demand and missteps by USA Truck in implementing new software were factors leading to a string of financial losses for the long-haul carrier that has more than 2,184 tractors and approximately 3,000 employees.

The company announced in late December the addition of Thomas Glaser to the management team. Glaser, a former president and COO of Celadon Group who has 24 years of trucking industry experience, is the second attempt to bring experience into USA Truck operations.

According to the Monday statement from USA Truck, Simone has more than 30 years of operational and management experience in the transportation industry with leading companies that include UPS, Ryder, and Greatwide Logistics. Most recently, he was the CEO of LinkAmerica where he led a successful operational turnaround.

Simone said during a Monday afternoon phone interview that he does not expect problems with a management structure that has the former CEO reporting to him as the CFO.

“I’m extremely excited to have Cliff back in the CEO role,” Simone said. “Cliff and I complement each other very well.”

In a statement, Beckham said he was happy to return to his CFO role – a job he held with USA Truck between 2002 and 2007.

“I am excited to return to my historical role as CFO and provide strong financial, cost-control, and management support to John and the rest of the team. We are unified in our commitment to restoring USA Truck to industry-leading performance,” Beckham said.

USA Truck Board Chairman Robert Peiser noted in the statement that hiring Simone “is an important next step that we expect to accelerate the process” of turning the company around.

Simone, who said he plans to move to the area, said his top goal is to restore the company to profitability as soon as possible. He said he has not been asked to simply turnaround the financials to position the company for a sale.

“There has never been any conversation about selling the organization,” Simone said.

Simone and Beckham, who also participated in the phone conference, said details of Simone’s contract will be released later this week through U.S. Securities and Exchange filings. Neither would comment when asked if Simone’s contract included deadlines or a timetable for his tenure as CEO.

Returning the company to the black side of the ledger won’t be easy. Simone said he will work with company management and employees to formulate “a strategic assessment,” and he said Monday he plans to complete the assessment “within seven days.”

A strategy from the assessment will be given “clarity and focus” and communicated to all employees, Simone said, adding that he doesn’t foresee wholesale changes.

“I don’t have any plans to come in and turn the organization upside down,” he explained.

Based on numerous sources providing information to The City Wire, one thing that may need to be turned upside down are morale problems within the company – especially at the corporate headquarters. Those sources have shared similar stories of a “vindictive environment” and “humiliating public firings” in the corporate offices.

Simone did not deny morale problems exist within the company. He said his leadership style is to treat people with “dignity and respect,” and “creating trust internally  and externally.” That method, Simone said, will help resolve conflicts.

“I don’t think turning the morale here is going to be a huge issue,” Simone said, adding that most employees see the potential of the company and are eager to be part of the turnaround effort.

Company shares (NASDAQ: USAK) closed Friday (Feb. 15) at $4.79. Markets were closed Monday. During the past 52 weeks, the share price has ranged from a $9 high to a $2.65 low. 

The local residential real estate market was muted in January as agents sold just 71 homes in Sebastian and Crawford counties combined. Unit sales slid 19.3% from 2011 and 26% from same month in 2010, according to MountData.com, an independent market source.

“January was a terrible month for home sales in Fort Smith. There were just 34 sales out of 806 listings in the city that closed in the month. I believe sales were pulled forward from the preceding months -- November and December which were fairly strong months,” said Kevin King, broker and owner of Weichert Realtors King Realty.

He said the insurance and tax law changes which came into effect in January encouraged some buyers to get their deals done in 2012 but he expects February sales to be a little stronger as showings and listings are improving.

“We don’t necessarily need a lot more listings but buyers do need ample selection,” King said.

Agents sold 48 homes in Sebastian County during January. These sales had a total volume of $6.072 million. Units were down 15% and volume slumped 25% from the year-ago period, according to MountData.com.

Crawford County agents sold 23 homes in January versus 31 in the prior-year period. Sales volume declined 35% as transactions totaled $2.287 million last month, this compared to $3.520 million a year earlier.

Not only were the number of home sales down but the median sales price also took a hit in January after rising 6.9% during 2012.

In Sebastian County the median sales price was $116,000, this compared to $133,000 a in January of 2012.

Crawford County median prices also fell among the home sold last month. Median home prices of $82,250, were down 7.3% from a year ago.

King expects home prices to stay muted in 2013 as more foreclosures make their way into the marketplace.

“We did see an increase last year, but there were very few foreclosures being sold. But as that number increases in 2013, there will likely be some downward pressure on overall pricing,” King said.

Ken Colley, a local real estate appraiser for more than 40 years, says home values have been on a downward slide for the past four years, with the exception of the new home market.

“New construction homes priced between $140,000 and $300,000 seem to be holding their own, that’s not been he case with the broader market,” Colley said.

He expects foreclosures to have a bigger negative impact on pricing in 2013 and says 25% of his business is appraising bank-owned property.

Colley said a home purchase appraisal can be negatively impacted from foreclosures in the immediate area and while he looks for non-distressed comparable sales, he said ultimately, the lender requirements dictate the comparable criteria.

“Not only do lenders want three pre-sold comparables but they also now want two listings in the mix. If there are more distressed sales or listings it could have an adverse impact on an appraisal,” Colley said.

Mortgage lender Arvest has a more positive outlook for 2013.

“This is typically a slow time of year, but we are seeing a lot of preapproval activity which will result in purchases ahead.The local economy had a lot to do with 2012 sales, and many opted to refinance and stay where they were, instead of buying. It is definitely a buyer’s market with record low rates, and plenty of inventory available,” said Maria Lau, senior vice president of mortgage lending.

Lau added that several mortgage loan products have gone away due to the mortgage meltdown a few years back, and these products have not been replaced, making purchases difficult for buyers that have unique credit situations. 

She went on to say there are still plenty of mortgage options available for qualified buyers.

January Market Activity
Sebastian County
Total Sales Volume
2013: $6.072 million
2012: $8.121 million
2011: $7.799 million

Median Sales Price
2013: $126,514
2012: $142,477
2011: $113,033

Crawford County
Total Volume
2013: $2.287 million
2012: $3,520 million
2011: $2,658 million

Median Sales Price
2013: $85,250
2012: $88,791
2011: $96,750

Source:MountData.com

NanoMech Inc. of Springdale has received the Top Emerging Nano Innovator Award from the NanoBusiness Commercialization Association (NanoBCA), for the second year in a row. NanoBCA is a leading business association dedicated to protecting and promoting the burgeoning nanotechnology industry.

NanoMech was recognized for its market leading innovations with the proprietary nanomanufactured products TuffTek®, nGlide® and nGuard®.

"NanoMech has been on our radar for several years," said Vince Caprio, executive director of NanoBCA., "The advancements they are making in the materials science and nanomanufactured products space is nothing short of game changing. It is an honor to recognize such an innovative company that is improving the science in their field and launching revolutionary products."

"We are thrilled that our work remains on the cutting edge of the industry and has been recognized by NanoBCA as one the top emerging nano innovators in 2013," said Jim Phillips, NanoMech President and CEO. "We know the products we are selling are transforming industries overnight and outside recognition lets us know we are on the right path."

NanoMech is rapidly expanding the scope of products produced and sold in 2013. "This is a very exciting time for NanoMech," said founder and chief technology officer Ajay Malshe. "We have a solid team of world class scientists innovating every day to create much more advanced products that our customers love."

Arvest Bank said Monday that the agreement to buy 29 locations from Bank of America has received regulatory approval.

All acquired locations are within or near existing Arvest markets including two new locations in Russellville, Ark.

In addition to the locations, Arvest will also gain most deposit accounts such as checking, savings, IRAs and CDs belonging to consumer and small business customers who live in the local area and are serviced at these locations. The transaction does not include credit card, mortgage, brokerage or trust accounts.

In Arkansas, the Russellville market will add two branches to the three existing Arvest locations. Also in Arkansas, Hot Springs and Hot Springs Village are the most affected communities in Arkansas, where five branches are being acquired. Four of these branches will remain open for a total of seven Arvest branches in this community.

Mountain Home and Harrison are each adding one branch location. Fifteen branches in Missouri, four in Oklahoma and one in Kansas are also included in the agreement.

Arvest Bank operates more than 240 bank branches in Arkansas, Oklahoma, Missouri and Kansas through a network of 16 locally managed banks, each with its own board of directors and management team.

The two commercial airports serving Northwest Arkansas and the Fort Smith areas got off to a mixed start in 2013.

Enplanements at the Northwest Arkansas Regional Airport (XNA) during January totaled 38,767, up 2.8% compared to January 2012. Enplanements at XNA totaled 565,045 during 2012, up just 0.4% compared to 2011. Although slight, the gain prevented XNA from posting two-consecutive years of enplanement declines.

Enplanements at XNA totaled 562,747 during 2011, down 1.38% compared to 2010. During 2010, XNA had 570,625 enplanements, up 5.49% over 2009. XNA’s first full year of traffic was 1999, and the airport posted eight consecutive years of enplanement gains before seeing a decline in 2008. It reached a peak of 598,886 in 2007.



FORT SMITH
Enplanements at the Fort Smith Regional Airport totaled 5,958, down 9.49% compared to January 2012.

Enplanements at the Fort Smith Regional Airport totaled 86,653 during 2012, just ahead of the 86,234 in 2011, and marking three consecutive years of enplanement gains.

Enplanements at the Fort Smith Regional Airport during 2011 eked out a 0.12% gain over 2010, marking two consecutive years of enplanement growth at the airport. For the year, the airport posted 86,234 enplanements compared to 86,129 during 2010.

The January figures at Fort Smith continue a downward trend from the fourth quarter of 2012. Enplanements were down almost 6% during the 2012 fourth quarter compared to the 2011 period.

LITTLE ROCK

Enplanements at the Bill & Hillary Clinton Airport (Little Rock National Airport), totaled 1.147 million for all of 2012, up 4.07% compared to 2011. (The airport did not have January numbers as of Feb. 18.)

December 2012 enplanements totaled 87,808, down 3.86% compared to December 2011.

The 2012 numbers ended five consecutive years of enplanement declines.

Enplanements at Little Rock National during 2011 totaled 1.103 million, down 1.92% compared to the 2010 period.

TRENDS
It may prove tough for Arkansas’ commercial airports to maintain the 2012 pace.

The Boyd Group, an aviation consulting company, predicts that in 2013 the reduction in the number of seats in the commercial aviation system will result in an overall 2% to 2.5% decline in passenger traffic.

An announced merger between American Airlines and US Airways also creates uncertainty. With American being the largest carrier at XNA, Fort Smith and Little Rock, talk of fewer routes and reduced reliance on smaller airports to feed the major hubs is a concern. The Boyd Group says seeking new routes will be difficult.

“The economics of air service have changed. With the impending merger of American and US Airways, there will be just nine major scheduled airlines, and all have specific route strategies. The options and potential for new service recruitment are shrinking fast. Consultant studies to ‘find the right airline’ will be right up there with ginning up a purchase contract on the Brooklyn Bridge,” noted the Boyd Group report.

America’s Car-Mart Inc. profits recovered nicely in the quarter ending Jan. 31, after an unexpected pitstop in the previous period.

The buy here, pay here auto dealer earned a net income of $7.98 million, which equaled 84 cents per share for business conducted between Nov. 1, 2012 and Jan. 31, 2013 – the company’s third quarter in fiscal 2014.

Profits sped passed Wall Street’s consensus 73 cents with industry analysts’ predictions ranging from 69 cents to 76 cents in net income earned per share.

Compared to the year-ago period Car-Mart improved net income by 12.86%.

Earnings were released late Monday, Feb. 18, with an earnings call set for the following morning. Shares of Car-Mart last traded Friday, Feb. 15 and closed at $41.56. Car-Mart has recovered about half of the 12% dip in share price which occurred following the previous earnings report in November.

In the third quarter, Car-Mart sold 10,403 vehicles hoisting up firm’s total revenue to $118.922 million, a 12.8% increase from the year-ago period.

"We are very pleased with our results for the quarter, and especially so with the significant increases in sales. As we mentioned after our second quarter, we had seen some increases in the amount of funding into the sub-prime auto industry which did create some increased competition that put some pressure on our sales earlier in the year. In typical fashion, our General Managers stepped up to the challenge and delivered. Our focus remains solidly fixed on driving the same mission we have for years; striving to earn the repeat business of our customers by providing quality vehicles, affordable payment terms, and excellent service,” CEO Hank Henderson noted in the release.

Car-Mart has more than 57,000 active accounts and continues it aggressive growth strategy opening two more dealerships in the earnings period.

Same-store revenue increased 8.8% from a year ago, according to Jeff Williams, chief financial officer for Car-Mart.

"As expected, higher unit sales resulted in significant leveraging at the selling, general and administrative line. When we look to the future we are convinced that the business model will continue to support significant unit volume expansion. The overall gross profit percentage was relatively flat with the prior year quarter and in line with our expectations,” Williams said.

During the quarter Car-Mart repurchased 62,160 shares of its common stock with free cash.

“Since February 1, 2010, we have repurchased 2,890,851 shares, or 24.7% of our company. We believe in the long-term value of our company and we plan to invest in the repurchase program when favorable conditions are present,” Williams said.

One area of concern in recent quarters has been thinning overall gross margins as wholesale auto prices continue to decline.

Wholesale prices fell by 0.6% in January. Absent the seasonal adjustment, the decline in vehicle values was half that amount, according to Manheim’s most recent used vehicle price report.

“It was well-anticipated that wholesale values would retreat somewhat at the beginning of 2013, given that Hurricane Sandy’s impact on the wholesale market would be waning and that auction supplies from commercial consignors would be rising,” Manheim chief economist Tom Webb said.

“Continued strength in the retail market, however, kept the decline in wholesale prices modest, for now,” Webb said.

Only one vehicle segment Manheim tracks in conjunction with its index reading moved higher year-over-year in January. Prices for pickups ticked up 1.1%.

Brad Wilson, general manager at the Car-Mart lot in Fayetteville, said Monday that sales have been great in February and rising gas prices have prompted a few customers to look for vehicles that get better gas mileage.

With respect to declining overall wholesale prices, Wilson said customers do benefit as the company will pass on the lower costs.

In the end, Wilson said that’s a long-term benefit for the company because when vehicles are more affordable for customers, there are more buyers shopping.

Paul Latture Jr., executive director Port of Little Rock, says December, January and February are the three “screwiest months” of the year, and advises against reading too much into Arkansas River tonnage numbers produced by the U.S. Corps of Engineers.

According to the Corps, river tonnage on the McClellan-Kerr Arkansas River Navigation System during all of 2012 was 11.687 million tons, up 10% compared to 2011.

Tonnage is just part of the picture, according to Latture. For example, Port of Little Rock tonnage was up 2%, but income was up 8% because of the type of cargo being unloaded.

“We don’t look as much as to the tonnage, but the kind of tonnage we are handling,” he explained.

Unloading manufactured products – like steel coils – is more lucrative than unloading bulk commodities like sand, gravel and other raw materials.

In 2012 the Arkansas River handled 1.426 million tons of iron and steel products, down 12% compared to 2011. Sand, gravel and rock accounted for 3.004 million tons, up 11% in 2012 compared to 2011. It was the largest, by tonnage, material segment on the river in 2012.

Chemicals and fertilizers were second at 2.18 million tons, up 11% compared to 2011.

Latture does believe the tonnage figures and the activity at the Port of Little Rock reflect improving economic conditions.

“Overall, you’re just seeing the economy, while it’s not soaring, you’re seeing the economy getting a little better,” Latture explained.

Marty Shell, president of Van Buren-based Five Rivers Distribution, agrees that conditions on the river are improving.

“Ports and terminals are a direct indication of the regional and local economy. We have seen our business pick up after the 2008 recession,” Shell said, but added that he remains unsure if the light at the end of the tunnel is a good thing “or a freight train taking us back into another recession.”

Shell also said economic uncertainty makes it more difficult for his business to plan ahead.

“In past we were able to predict three to four months out what our business was going to look like. In today's times the best we can do is 30 days out,” Shell said.

Part of the uncertainly, according to Shell, is that businesses are more analytical about their shipping decisions.

“Businesses are looking harder at their bottom line and know that (the) transportation cost is one of the top three costs in running a business and customers are looking for the most cost effective mode of transportation to fit their business,” he explained.

To that point, Latture said railroad-related income at the Little Rock port has surpassed income from river traffic. He said about five years ago the river and rail tonnage was about even.

“What we see on the rail is that it just goes up and up and up every year,” Latture said of rail usage.

He said the ratio of shipping between rail and the river is typically a function of the economy. In a booming economy, larger quantities are shipped, and that requires more barge use. As the economy cools, smaller quantities are more cost-effectively shipped using rail.

Shell is optimistic about 2013 despite what he sees as a fickle economy.

“2012 was a good year for our company, but we hope to grow our footprint in 2013 to different market sectors and to market this region as a transportation hub to not only to retain businesses and jobs, but to bring in new businesses and jobs to this region,” Shell said.

As for the beginning of 2013, the 39% January increase in tonnage traveling the river is an example of Latture’s “screwiest months” analysis.

The river was closed to through traffic for almost two weeks in December because of maintenance at the Montgomery Point Lock and Dam near the confluence of the Arkansas and Mississippi Rivers.

“And then we had everyone lined up here (in January) trying to catch up. ... That’s what I mean by screwy,” Latture said of the bottleneck created by the river closure in December.

Weather, maintenance and holidays are the primary factors causing December, January and February to be screwy, Latture said.