For the tale of the tape, the TSX Exchange added 1.58%, while the TSX Gold Index fell 4.2% and the TSX Venture Exchange, Canada’s largest junior exploration bourse, rallied 0.56% with the declining issuers edging out the advancers by a 511 to 408 margin on volume of 143 million shares traded.

Cash rich SNS Silver and cash-poor Andover Ventures (AOX) have inked a deal to merge. Under the proposal, SNS shareholders will get half an Andover share for each SNS share held. SNS has also provided Andover with a C$2 million bridge loan. SNS closed flat at C$0.16, while Andover dropped C$0.03 to close at C$0.34.

ATW Venture (ATVWF) cut 13.37 grams gold per tonne over 15.6 metres at its Burnakura gold mine in Western Australia. The result was good enough for a C$0.06 gain as shares in the junior closed at C$0.44.

Sherwood Copper (SWK), which added C$0.70 to close at C$4.30, hit 9.6 metres grading 2.58% copper at the high-grade Minto copper-gold mine in the Yukon.

Not to be outdone, Osisko Mining (OSK) tabled a 258 metre intercept running 2.13 grams gold per tonne at the South Barnat target some 1.2 km from its Canadian Malartic project in Quebec. Osisko ended the session up C$0.41 at C$2.95

Shares of Cameco (CCJ) continued to slide closing down C$0.63 at C$23.44. The company reported that production at its Key Lake mine in Saskatchewan will come in lower than expected. Earlier the company reported a green light to restart operations at its Port Hope uranium hexafluoride conversion plant that was shut down in July 2007 for contaminated soil. On the downside, its supplier of hydrofluoric acid has terminated its contract leaving the company without the key ingredient needed to produce uranium hexafluoride.

Liquidity or the lack there of remains a major stalling point for the more speculative issues. Cash rich companies can sit back and wait things out but the cash poor explorers will be fighting for survival by looking to do deals. Meanwhile, the prospects moving the debts off the books of the financials by throwing all the bad ones into a U.S. government vehicle may have the markets jumping for joy but one has to wonder as to the scale and practicality. We will see what Friday trading has in store.

Source: Resource Stock Roundup Friday September 19, 2008

Of course you could.

But if they led you blindfolded into another restaurant, could you tell immediately whether you were in a Bennigan’s, Ruby Tuesday (RT), Chili’s, Friday’s, Applebee’s… or some other? Before you read a menu or looked at the staff uniforms?

Probably not. Unless they led you into a restaurant in your own neighborhood that you visited often.

Bennigan’s is in bankruptcy, Friendly’s was a turnaround that got bought out, Steak ‘n Shake (SNS) is going down, Ruby Tuesday is cutting back.

And even as “sales” are rising for some restaurants, better double-check the numbers. According to industry watcher Technomic, the top 20 restaurant chains increased their locations by 45% in the past five years, while sales only rose 31%. So a good many of those improving sales numbers came from chains that expanded weaker and weaker businesses… right to the brink of failure.

As for the restaurants, what’s to choose? The menus and prices change periodically. And each has a different exact décor—but somehow they all look alike, smell alike and sound alike.

They are tired ideas. Each perfectly fits its stronghold—the suburban strip mall or parking lot facing a busy highway circa 1980. They are all the same as they were then. We needed a few of these chains. But there were too many. They wore this idea out. And now when people are cutting down on unnecessary spending, there is nothing festive, special or necessary about eating in these me-too restaurants. That—not just the economy—is what is dragging the casual dining group down and killing some of them.

This model so overwhelmed America 30 years ago that it is hard to imagine how one would decorate and set up a new restaurant chain that would be noticeably different and successful.

But someone will. Just as the 1950’s steak houses gave way to the 1980s casual American-Irish-comfort-everything concept, another model will come along.

Until then, I am watching stories like the bankruptcy of Bennigan’s and Steak and Ale (along with the turnaround for Talbot’s) and turnaround promises from others with great skepticism.

Forbes once listed the three traits for a good turnaround as a (1) sales jump, (2) cost-cutting, and (3) a new product.

Talbot’s (TLB) had a new product and it was a total mistake. Failing restaurants try changing menus and prices all the time without success. It has to be a new salable product. Something customers want to buy. And one that the business can sell at a profit in great numbers.

Cost cutting by itself is a losing plan. Companies do not get rich by selling off working assets. Period. They may even dilute their ability to carry on their business after stripping assets out. A good cost cutting plan has to pare off true fat and be carried out according to a strategy that leads somewhere. A case of this was when Office Depot (ODP) discovered it did not reap many extra sales on its excessive variety and limited some package sizes or colors while keeping the best selling version of items always in stock. It also closed stores that were within a prescribed distance of another office supply store. That is what a cost-cutting strategy should look like.

As for a sales jump? Well, by that time the turnaround has turned.

Source: Speaking of Turnarounds – Why I Don’t Like Restaurant Stories Now