Redhook Sinking Thanks To Distribution Problems

Redhook Ale Brewery Inc. shares lost as much as a third of their value after the company said third-quarter earnings would fall below forecasts, partly because a change in distributors hurt its sales.

Redhook ended the week at $17, down $4.06-1/4 Friday. The shares earlier fell to 14-1/4, a record low.

The specialty brewer said it would earn 10 cents or 11 cents a share in the quarter, less than the 15 cents expected by nine analysts surveyed by Zacks Investment Research. It earned 12 cents a year earlier.

The company blamed weaker sales in Northern California on difficulties in changing to distributors associated with Anheuser-Busch Cos., a part owner of Redhook.

Chief Executive Paul Shipman, who said the changeover disrupted deliveries and stalled promotional efforts, compared the transition to a messy divorce.

“When it’s all done, it’s like the First Wives Club. It’s pretty emotional and intense,” Shipman said in an interview.

A slower-than-expected rise in sales in Washington state was more troubling to investors. Redhook’s officers did not have an explanation for the disappointing results.

“We do not sense any fundamental changes, but we had a disappointing quarter,” Shipman said.

The company’s distribution problems in Northern California appear behind it, investors said.

“The beer can taste good, but if you don’t have the distribution, it’s not going to matter,” said David W. Simpson, vice president and portfolio manager at Composite Research & Management Co., which owns about 125,000 shares.

Some of the stocks that moved substantially or traded heavily:

NYSE

McKesson, up $3.62-1/2 at $49.37-1/2.

San Francisco-based McKesson will pay $80 million to acquire FoxMeyer Drug Co., the ailing healthcare distribution business of its Dallas-based rival FoxMeyer Health. McKesson said it expects to invest a total of $400 million to satisfy FoxMeyer Drug’s creditors and other financing arrangements.

Raytheon, down $4 at $49.

The Lexington, Mass.-based company said third-quarter operating income will be lower than expected. Raytheon attributed the drop in operating income to a backlog in awards and contracts at Raytheon Engineers & Constructors and a weak market for the large appliances it manufacturers, such as refrigerators, washers and dryers.

NASDAQ

KinderCare Learning Centers, up $3.50 at $19.75.

The nation’s largest day-care chain is being purchased by Kohlberg Kravis Roberts & Co. in a $600 million deal. The takeover, announced Thursday after the close of trading, calls for KinderCare stockholders to receive $20.25 a share in cash, but allows some to retain their shares.

KKR will own 85 percent of Montgomery, Ala.-based KinderCare.

Gensym, down $8.50 at $12.50.

The Cambridge, Mass.-based software company said third quarter earnings will be lower than the company expected. Gensym said it didn’t close some significant orders as anticipated.

AMEX

Emeritus, down $3.50 at $12.

The provider of senior-housing services expects earnings for 1996 and 1997 to be well below expectations due to increased acquisitions of under-performing senior housing communities as part of its growth strategy.

Seattle-based Emeritus also attributed the showtfall to an emphasis on ownership rather than leasing of communities and slower fill-up of vacant units.