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May 9, 2012

Amazon announces plans for new Kentucky facility

Online retailer posts first-quarter loss

JEFFERSONVILLE — Amazon.com on Wednesday added to its plans for a fall opening for a 1-million-square-foot distribution center in Jeffersonville by announcing it is adding another facility to the region in Kentucky’s Clark County.

Amazon plans to open a new 70,000-square-foot customer service facility in Winchester, Ky., — east of Lexington — which will create more than 550 full-time and 600 seasonal jobs in Kentucky by 2017, according to a press release.

“Amazon’s decision to grow its Kentucky footprint is fantastic news, especially when you consider the impact of more than 1,100 full-time and seasonal jobs it will bring to the central Kentucky region,” said Kentucky Gov. Steve Beshear, in the press release. “Kentucky is proud to have Amazon choose Winchester for this growth opportunity and wish them continued success and prosperity.”

The new customer service center is expected to open in late summer and will be based at Winchester Plaza during construction of the permanent facility. The permanent facility is expected to open in 2013. The center is designed to provide customer service and technical support to Amazon’s fulfillment centers in the area.

“There are thousands of employees working in Amazon’s fulfillment centers across Kentucky, and we’re proud to be expanding our presence in the state with the opening of a customer service center,” said Amazon Customer Service Vice President Tom Weiland in the press release. “We hope to have our team in Winchester up and running before the holiday season.”

Amazon operates five fulfillment centers throughout Indiana, including the River Ridge location under construction.

EARNINGS DOWN

The company took a hit with its first-quarter earnings.

For the first three months of the year, net income was down 35 percent or 28 cents per diluted share, compared to 2011’s first quarter with net income totaling $201 million, or 44 cents per diluted share. The quarter was affected by Amazon repurchasing $960 million worth of stock, or 5.3 million shares, and by year-over-year changes in foreign exchange rates, according to the company’s quarterly report.

The year-to-year change cost Amazon $4 million, according to the report. The company had previously announced it would repurchase up to $2 billion of its common stock.

Operating income also took a major hit, from $322 million in the first quarter of 2011 to $192 million in the first quarter this year.

Despite the drops in income, there were some positive results reported in Amazon’s quarterly statement.

Net sales for the online retailer increased 34 percent to nearly $13.2 billion, up from $9.86 billion in the first quarter of 2011. Net sales in the company’s North American segment also showed an improvement of about $2 billion, an increase year-to-year of 17 percent.

Shares for Amazon (Nasdaq: AMZN) closed down 92 cents, or 0.41 percent, at $222.98 per share Wednesday.

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