Business Briefs – July 2011

By wmadministrator

ASHLAND
AK Steel
has closed its coke plant in Ashland, saying the plant was no longer cost competitive due to maintenance issues and increasingly stringent environmental regulations.  As a result of those issues, the total per-ton cost of coke produced there had become significantly higher than all other sources of coke for the company. The coke plant employed 263 employees, but the company has moved all but 25 jobs to its Ashland Works steel plant. Company officials say replacing Ashland’s high-cost coke helps make the balance of Ashland Works, which now employs more than 1,000 employees, more competitive.

BARDSTOWN
Heaven Hill Distilleries Inc.
has acquired the worldwide rights to the Admiral Nelson family of rums from St. Louis-based Luxco Inc.  “Admiral Nelson is a very strong brand that is experiencing phenomenal growth in a rapidly expanding segment of the rum category,” said Max L. Shapira, president of Heaven Hill, which is headquartered in Bardstown.  “Its five-year growth has outpaced both the overall spirits industry and the rum category specifically, and it has won multiple Impact Hot Brand Awards and Beverage Information Group Growth Brand Awards. We believe our sales and distribution capabilities will further build on this success in the coming years.”

More than 150 people gathered last month in Bardstown to celebrate the completion a $3 million downtown streetscape project. The project included a redesign of the court square, as well as the construction of new water lines, sidewalks, handicap ramps, streetlights, landscaping, and benches. The project was funded by a combination of stimulus funds, transportation enhancement funds and a federal earmark from Kentucky Congressman Brett Guthrie’s office.

ERLANGER
Toyota says it expects North American vehicle production levels to return to 100 percent in September, as part suppliers have recovered earlier than originally anticipated following the March 11 earthquake and tsunami in Japan. Eight of the company’s 12 North American-built models returned to 100 percent production on June 6, and Toyota is hiring 3,000 to 4,000 temporary workers in Japan to help the company regain full production.  Toyota’s North American manufacturing headquarters is located in Erlanger.

FLORENCE
Mazak Corp.
, a Florence-based company that designs and manufactures machine tool solutions, has opened a new 30,000-s.f. technology center and regional headquarters facility in Houston, Texas. The new research and development facility will provide support to manufacturers in all sectors, with a special focus on those serving the energy and oil and gas service industries.

GLASGOW
Sitel
is in the process of hiring more than 300 workers for its call center in Glasgow. The company is adding staff to help support the company’s contract with Best Buy to handle customer service issues. The Glasgow call center currently employs a staff of approximately 335.

LEXINGTON
The owners of the Orange Leaf Frozen Yogurt franchise in Lexington have secured rights to open stores throughout the Bluegrass state, according a report in The (Lexington) Herald-Leader. Plans call for the franchise to open 10 locations by the end of 2011 and up to 20 by the end of 2012. A fifth store is slated for Lexington as well as several in Louisville and locations in Bellevue, Elizabethtown, Georgetown, Owensboro and Richmond.

The University of Kentucky has approved an operating budget of nearly $2.7 billion for 2011-2012, a 7 percent increase over the previous year. The increase in the budget is being driven primarily by the continued growth of UK’s health care enterprise. While the budget for the state’s flagship university has grown in recent years, state support has continued to decline: In the proposed budget, state support is 11.3 percent, down from 25.6 percent in 2001. The new budget includes a proposed 3 percent merit raise pool for non-hospital faculty and staff. The hospital budget includes a 2 percent merit raise pool for its employees. Other increased costs include additional support for academic support services, student financial aid, and utilities and maintenance, among other items.

LEXINGTON/LOUISVILLE
Total Quality Logistics  (TQL), a third-party logistics brokerage company, is adding sales associates for its new offices in Lexington and Louisville, which are scheduled to open this summer. The Cincinnati-based company currently operates satellite offices in Ohio, Illinois, Colorado, South Carolina, North Carolina, Florida and Indiana, and has more than 1,100 employees. TQL facilitates more than 400,000 truckloads annually for approximately 7,000 clients.

LOUISVILLE
The (Louisville) Courier-Journal has laid off 50 employees as part of companywide cuts implemented by parent company Gannett in response to declining advertising revenue. The Louisville layoffs, which include 24 newsroom employees, represent approximately 10 percent of the total Courier-Journal staff.  The layoff is the third time since 2008 that The Courier-Journal has been forced to reduce its staff: 51 were laid off in 2008 and another 44 in 2009.  According to The Courier-Journal, Gannett – which operates 82 daily newspapers, including USA Today – has seen its annual revenue has fall by more than $2 billion – nearly 30 percent –  since 2006.

Churchill Downs
was forced to suspend operations on June 23 after severe storms caused significant damage to nine barns, along with a number of stable area structures, including some living accommodations for backstretch workers.  No injuries to workers or horses on site was reported and racing resumed on June 24. Prior to the storms, the track reported higher than expected wagering levels for its spring meet and as a result, increased overnight purses by 15 percent for the last three weeks of the meet, which ended on July 4.

BAE Systems has received a $26.6 million contract from the Naval Sea Systems Command for two additional propulsor units for submarines that will be produced at the company’s Louisville manufacturing facility, where it employs approximately 300 people. The Minnesota-based company said the contract was “an important step in strengthening BAE Systems’ propulsor manufacturing based in Louisville.” Production is slated to begin this summer with work expected to be complete by March 2014.  BAE has also been awarded a $55 million contract for mechanical components and assemblies of the Mk41 vertical launching system, the primary missile launching system on board Navy combatants. Production will take place at five BAE sites, including Louisville, and will run through 2013.

RxCrossroads, an Omnicare-owned company that provides specialized solutions for the biotech and pharmaceutical industries, has opened a new pharma-grade warehouse facility in Louisville to support the company’s third-party logistics business. Company officials said the expansion has the potential to create dozens of new jobs. The new 98,925-s.f. National Turnpike Pharma and Bio Logistics Center gives the company increased controlled room-temperature storage and the option for an additional 30,000 s.f. of space. Future plans call for adding refrigerated storage space. The new facility is in addition to RxCrossroads’ existing 132,000-s.f. facility in Louisville that offers controlled room, refrigerated and frozen storage capabilities.

LONDON
Employees at Hearthside Food Solutions have voted 416 to 168 in favor of remaining union-free, according to a report by The (London) Sentinel-Echo. The London facility, formerly known as Laurel Cookie Factory, was acquired in 2010 as part of Hearthside’s purchase of Consolidated Biscuit Corp.  Employees of Hearthside’s Ohio bakery also voted in favor of remaining union-free.

MAYFIELD
MVP Group International, a South Carolina-based company that produces candles and home fragrance products, is investing more than $2.5 million to upgrade its facility in Mayfield and add new equipment. The upgrades will enable the company to add a new product line to its group of products, which includes brands such as Olde South Candle Company, Colonial Candle and Carolina Candle. The expansion will add 16 new jobs to the existing Mayfield employment base of 110.

MOREHEAD
St. Claire Regional Medical Center has acquired two buildings and an adjacent lot from the Rowan County Board of Education for $370,000, according to The Morehead News. The hospital plans to relocate some of its administrative offices to the newly acquired facilities.

SOMERSET
SafeAuto
insurance company has opened a new 20,000-s.f. call center in Somerset that replaces the facility it has been leasing for the past several years. The Ohio-based company began its Somerset operations in 2008 with 48 employees and has since grown to a staff of 83. The new call center has room to accommodate 250.

SPRINGFIELD
North American Pipe Corp.
has closed its PVC pipe production plant in Springfield, which is one of the Houston-based company’s smallest pipe plants. The company said the closing is part of an effort to reduce costs and optimize production operations in the face of excess capacity in the PVC pipe market. The closing eliminates some 47 jobs.

WURTLAND
The U.S. Department of Commerce has granted foreign-trade zone status to the Ohio River port at Wurtland, making it one of only three general-purpose foreign-trade zones in Kentucky. (The others are located in Louisville and Boone County.) A foreign-trade zone is a designated location in the United States where companies can use special procedures that help encourage U.S. activity and value added – in competition with foreign alternatives – by allowing delayed or reduced duty payments on foreign merchandise, as well as other savings. The designation offers numerous benefits to businesses and could be beneficial in helping recruit new companies to the area.

STATE
For the first time since February 2009, Kentucky’s seasonally adjusted preliminary unemployment rate fell below the 10 percent mark to 9.8 percent in May 2011, according to the Office of Employment and Training (OET). The standout industry in the most recent report was the leisure and hospitality sector, which added 700 jobs in May 2011 and a total of 11,500 positions since May 2010. OET officials attributed the increase primarily to a rise in restaurant openings. The United States’ seasonally adjusted jobless rate increased from 9 percent in April 2011 to 9.1 percent in May 2011.

Kiplinger’s Personal Finance Magazine’s June issue lists Kentucky among its top tax-friendly states for retirees. The magazine cites exemption of Social Security benefits from state income taxes; allowing residents to exclude up to $41,110 per person in retirement income from a wide variety of sources, including public and private pensions and annuities; a homestead provision that exempts part of the value of their property from state taxes; and an exemption of immediate family members from inheritance taxes. The states that were included in Kiplinger’s top 10 were: 1) Wyoming 2) Mississippi 3) Pennsylvania 4) Kentucky 5) Alabama 6) Georgia 7) Oklahoma 8) South Carolina 9) Delaware and 10) Louisiana.

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