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3Com Corporation (COMS)
F4Q06 Earnings Conference Call
June 28, 2006 5:00 pm ET
Scott Murray - CEO
John Vincenzo – Director Investor Relations and PR
Don Halsted - EVP and CFO
Matt Shimao - Bear Stearns
Jiong Shao - Lehman Brothers
John Marchetti - Morgan Stanley
William Becklean - Oppenheimer
Manny Recarey - Kaufman Brothers
Long Jiang - UBS
Mark Sue - RBC Capital Markets
Good day, and welcome to this 3Com Q4 2006 quarterly conference call. This call is being recorded. At this time for opening remarks and introductions, I would like to turn the call over to Mr. Scott Murray, Chief Executive Officer. Please go ahead, sir.
Scott Murray
Thank you, operator. Good afternoon, everybody. Before we begin today, I want to make a comment about Ciel Caldwell, our Director of Investor Relations, who I know many of you know. She has been expecting her first child and was due in June; and today she's in the process of becoming a new mother, of all days. We at 3Com heartily congratulate her and her family.
As you also may know, over the past few weeks in anticipation of this event, she has been transitioning her Investor Relation responsibilities to John Vincenzo. I would like to welcome John to his new role of Director of Investor Relations and PR within 3Com, working with Don Halsted, our CFO. Now, I would like to ask John to introduce the call for today, please.
John Vincenzo
Thank you, Scott. The remarks being made on this conference call contain forward-looking statements made pursuant to the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995. These include forward-looking statements regarding our goal to reach profitability and reduce costs; and our restructuring plan, including facility closures and expected footprint; workforce reduction; estimated charges, cost savings and efficiencies, and timing for each; decisions on where to invest and add resources; go-to-market plan and partner relationships; strategic direction; the future ownership of H-3C; H-3C product plans and performance; coordination among our businesses; return of capital from H-3C and expected sale of certain non-core assets.
These statements are neither promises nor guarantees, but involve risks and uncertainties that could cause actual results to differ materially from the forward-looking statements. These risks include, without limitation, the risks detailed in the Company's SEC filings, such as our 2005 Form 10-K.
On this call, we will also discuss several non-GAAP financial measures, including non-GAAP operating loss, several non-GAAP H-3C segment measures, and several pro forma non-GAAP measures for periods not required by GAAP. For each non-GAAP measure, the most directly comparable GAAP measure and a reconciliation of the non-GAAP measure to its most comparable GAAP measure can be found in tables at the back of the press release announcing our results. The press release is available on the Investor Relations section of our website, www.3Com.com. With that, I'll turn the call back to Scott.
Scott Murray
Thank you, John. With me today is our Chief Financial Officer, Don Halsted, who will review our financial results for our fiscal fourth quarter and our fiscal year 2006 with you in just a few minutes.
However, before we get into the specific details regarding our financial performance, I'd like to spend a few minutes sharing my thoughts on the current state of our business. During my remarks today, I will discuss our two operating segments within 3Com.
First our Secure Converged Networking, or SCN segment, which includes our security, data and voice product offerings. Then I'll discuss our Huawei-3Com joint venture in China, which is otherwise referred to as H-3C.
As I mentioned during our last call, we have four key business priorities:
- Create a world class go-to-market strategy.
- Continue to invest in new technologies.
- Leverage and enhance our relationship with H-3C.
- Design an appropriate business model and infrastructure to sustain profitability.
While we are making progress in all four areas, today I'm going to spend much of my time focusing on two of these priorities: H-3C, which we began consolidating with this quarter's results, and the business model we have designed to reach our goal of profitability, including details of a cost realignment program.
Before I get into the specific details around our efforts to reach profitability I'll first give you a snapshot of key aspects of our financial performance. Overall, we are pleased with our pro forma results of this business, which were primarily driven by the strong performance of H3-C and cost containment in the SCN. However, we recognize there's still much work to do with respect to our SCN Segment.
Our revenue on a pro forma basis in the fourth quarter was $304 million, a 22% increase over the same period in the prior year. Our non-GAAP operating losses reduced to $8 million in the fourth quarter of fiscal 2006 from a $51 million dollar loss in the fourth quarter of fiscal 2005. This was driven by a combination of cost controls and the inclusion of two months of H3-C results.
We also continue to maintain a strong cash position. 3Com ended the fourth quarter with $864 million in cash and short-term investments, which included $169 million from H3-C.
Don will comment on the results of our business carry ons but I want to mention a factor in our security business performance today. While our security product segment was up year-over-year by over 60% from last fourth quarter '05, we did see a quarterly decline. Some of this decline was due to the seasonal nature of customer buying trends at the end of the calendar year, which was our third quarter; and some of the decline was due to the issues arising from the move of one of our contract manufacturers from the U.S. to Mexico, which we believe have largely been resolved.
Now turning to H3-C. This business unit continues to perform well, which had a positive impact on our consolidated results for the fourth quarter. H3-C delivered sequential growth despite having a traditionally slow period in the quarter, due to the Chinese New Year. Our joint venture continues to be a strong player in China.
For the calendar quarter ended March 31, 2006 approximately 70% of H3-C's stand-alone revenues were generated in China. Don and I were just in China a little over two weeks ago meeting with H3-C and Huawei as part of our management process that we have established and we were very impressed with the operations, product plans, and the management team.
While I'm commenting on H3-Compression, I want to address a topic that I'm sure is top of minds for many investors. That is the ownership of H3-C post mid-November of this year. As you all likely know, starting in November the governing structure for our joint venture allows either 3Comm or Huawei to consider additional ownership positions through a bidding process.
As I commented last quarter, we expect to continue our discussion with Huawei to determine the outcome for the future ownership positions of H3-C. The ultimate decision is expected to be based upon a number of factors, which include H3-C's continued strong performance, 3Comm's long-term strategic plan, continued involvement and expectations of Huawei.
In this regard, 3Comm Management and its Board of Directors are carefully discussing the strategy. As we are now consolidating H3-C's results, we continue to build a collaborative management process and increase the coordination between the two business segments. We expect to have more information to share with you regarding the joint venture and it's ownership in the coming months; but as I hope you can appreciate, as with any transaction-related event, these discussions must remain confidential during this period.
Clearly H3-C's growth contributed significantly to 3Com's pro forma results, while we continue to work hard to improve the performance of the SCN Segment of our business. We go back to the priorities that I outlined earlier. I stated, we must create the infrastructure and business model to improve the profitability of the business.
To help drive this, today we announced a plan to realign certain aspects of 3Comm's SCN cost structure to a more appropriate size and to enhance the discipline in our business and cost model. The cost savings and efficiencies we expect to achieve from this initiative are aimed at aligning 3Comm's SCN Segment to top line revenue performance. Once we improve the business model we intend to focus on growth. However, our near term priorities will be focused on continuing to drive profitability improvement.
I do want to emphasize today, however, that this cost reduction program does not relate to either our H3-C operations or the TippingPoint security business.
Now the first component of the restructuring focused on rationalizing our site footprint. As any global company, we recognize the importance of having local presence in various countries.
However, after analyzing our global footprint carefully, we determined that we could close or consolidate a number of these offices around the world and still effectively service our customers.
Overall, today we announced we were closing or consolidating 60 of our sites, moving to flexible space arrangements and regionalized sales support models. We still expect to have a presence in many of these countries but we'll increasingly use smaller key suites rather than fixed cost premises.
In addition, we recently decided to close our Santa Clara, California offices. As many of you recall, 3Comm moved its headquarters to Marlborough, Massachusetts several years ago, but we continued to maintain a presence in Santa Clara, with primarily representations from various administrative functions, including IT. Consolidating operations conducted in our Santa Clara with our corporate offices in Marlborough creates efficiencies and allows us also to market for sale the three owned buildings that 3Com has there.
The second phase of the reorganization will result in a head count reduction of approximately 15% of our full time SCN workforce or approximately 250 employees. The head count reductions will occur across all regions, primarily in the sales and marketing organizations, to align these groups to create a more cost-effective go-to-market model. There are also certain other G&A areas of the business that will be impacted by the workforce reduction resulting from various site closures.
The overall goal of our reorganization is not simply to reduce headcount, but also to invest appropriately in resource levels of critical areas of our business, reducing costs in areas where we can be more efficient.
Our current plan is to add employees to H3-C's operations as well as to TippingPoint Sales and Development Teams. Overall, H3-C had approximately 4,000 employees as of the end of March; while the SCN Segment of our business had approximately 1,550 employees as of the end of the fourth quarter in May.
We currently expect the combination of facility and employee reductions will result in a restructuring charge of approximately $10 million to $13 million. While we recognize these are tough decisions that affect many dedicated people, they are necessary to create the right business model for future profitability.
Another key component of our business realignment centers on increased focus on spending in our sales and marketing to drive innovation and to create great customer experience. We're taking a thorough look at how to spend our resources and create programs to provide greater returns on our investments.
For example, we are also looking at the delivery costs of our warranty program and other services support models. We are also working to build the necessary processes and systems throughout the entire Company to make us more cost efficient.
From a go-to-market perspective, TippingPoint will continue to target large enterprise organizations. In 3Com's SCN operating segments, a great deal of work has been done over the past few months under the leadership of our new head of Sales Marketing, Bob Dechant.
In the mid-market 3Comm will continue to target customers in key verticals such as education, government and health care. We have a strong base of channel partners that are experienced in selling within these verticals. These are areas where we see potential for growth, particularly with this focused approach.
We will also continue to build our relationships with our systems integrated service providers and provide access to many of these accounts to other large enterprises.
In addition to streamlining our core operations, we continue to focus on converting certain non-core assets to cash. For instance, we have agreed to sell a small portfolio of venture capital investments that the company has for approximately $17 million, which will result in a small gain in FY07. In addition, we are currently marketing the three buildings that we own in Santa Clara for sale.
In summary, we have made progress in the business. I'd like to close with the following highlights before I turn it over to Don. We are focusing on our core markets to build a quality global business in our security networking and voice products in specific verticals like education, government, and healthcare, just to name a few.
We've been able to reduce the run rate of our operating costs in the SCN business. We are taking steps, which we've announced today, to reduce the future SCN cost infrastructure in head count and facilities and will continue to invest in new hires in TippingPoint and within H3-C.
We have a strong balance sheet with over $860 million in consolidated cash. And last but not least, our H3-C joint venture with Huawei continues to demonstrate strong growth in China. With that, I'd now like to turn the call over to Don Halsted to provide you a more detailed discussion around our Q4 financial results.
Don Halsted
Thank you, Scott. Before I review our fiscal fourth quarter results, let me set the stage for the discussion by describing the current quarter reporting of the H-3C joint venture, as well as describing the two views of the business we'll be using going forward to review 3Com's consolidated results.
As you may recall, our joint venture operates on a calendar basis, and as such, we include the results of its most recently completed calendar quarter in our fiscal period reporting. Therefore, our fourth fiscal quarter includes the joint venture's performance for the period of January through March of 2006.
You'll further recall that we acquired majority ownership and established effective control at the end of January. Therefore, our reporting of H-3C and 3Com's GAAP results for the quarters reflects the joint venture's performance for the months of January on an equity basis, consistent with our prior reporting; and reflects the joint venture's performance for the months of February and March on a consolidated basis with an offsetting minority interest charge, reflecting Huawei's 49% interest in the venture.
Now, let me describe how we will discuss the performance of 3Com. First, we will start with reviewing the consolidated measurements of the business. For this quarter, it will include a review of both the GAAP consolidated results reflecting the H-3C joint venture on an equity basis for the month of January, and on a consolidated basis for the months of February and March, and a pro forma view of the consolidated revenue results of 3Com, including the H-3C joint venture as if we had consolidated the results for the entire period and in comparison periods.
Secondly, we will be discussing the performance of our two operating segments, SCN and H-3C, that we adopted with the consolidation of H-3C's results. The performance of these operating segments is included in table H of our press release, along with a corporate non-operating segment, which includes the revenue eliminations and equity ownership positions.
Finally, we will end with a review of the key elements on the consolidated balance sheet and the change in cash.
Before starting the performance review, I want to address guidance. In our last call, we stated that we did not think it was prudent to give forward-looking financial guidance. That is still our position. We have structured this review to give you good visibility into our current operating results in this period of transition. However, we will not be providing forward-looking guidance.
Now, let me start with a consolidated results review. This will include a brief discussion of revenue through operating loss which will be covered in more depth in our discussion of the operating segments. In addition, I will review the results below operating loss line on a consolidated basis.
The fiscal fourth quarter GAAP revenue was $255 million, a 43% sequential and a 44% year-over-year increase, driven primarily by the inclusion of two months of H-3C's results in the current fiscal quarter.
For the 2006 fiscal year, revenue was $795 million, a 22% increase over fiscal 2005, driven by the inclusion of two months of H-3C, as well as increased sales of TippingPoint Security products, and the inclusion of TippingPoint's results in the full current period.
On a pro forma basis, which assumes we consolidate H-3C for the entire quarter and in comparable periods, revenue for the fourth fiscal quarter was $304 million, which is about flat sequentially. For your reference, in table F of our press release we have provided the historical pro forma results for each quarter of fiscal 2006, along with the full year fiscal 2006 and 2005.
Table C in our press release provides geographic and product-based supplementary revenue disclosures and is presented on a consolidated basis. On a geographic basis, we had sequential declines in EMEA, North America, and Latin South America of 10%, 6%, and 5% respectively. These declines were more than offset by an increase in our Asia Pacific region, driven by the inclusion of H-3C. With the inclusion of H-3C, APR becomes 3Com's largest region, with $112 million of revenue in the fourth fiscal quarter.
On a product basis, networking grew by 66% sequentially, driven by the consolidation of two months of H-3C, partially offset by declines in our SCN segment.
Security product sales declined 3% sequentially, driven primarily by the seasonality and the transitional manufacturing issues addressed earlier by Scott, offset in part by the addition of H-3C's security sales in China. Security product sales still grew 66% compared to the fourth fiscal quarter of 2005.
Voice products increased 16% sequentially, primarily due to the inclusion of the H-3C voice product sales in China, and to a lesser extent, increases in sales of SCN voice products.
Services increased 10% sequentially, also driven by the inclusion of H-3C, as well as increases in SCN segment performance.
Revenue from connectivity products was $8 million, a 30% sequential decline, resulting primarily from inclusion of a $3 million revenue sharing arrangement related to the sale of certain intellectual property rights in the previous quarter.
Of note within the quarter is that we have made the decision to end-of-life certain connectivity products, as we determine that the cost to ensure EU RoHS compliance was not economic.
Results at the gross margin and certain operating lines will be described in the discussion of the operates segments following this review of the consolidated results. On a consolidated basis, each of these lines was significantly impacted within the quarter by the inclusion of two months of H-3C's results.
The GAAP operating loss for the fourth quarter was $21 million compared to $47 million in the third quarter and $62 million in the same period of fiscal 2005. The $41 million year-on-year improvement can be separated into $26 million due to the reduced operating losses in the SCN segment, and $15 million of operating profit from two months of H-3C.
The SCN operating loss improvement was driven by operating expense reductions, offset in part by lower gross profits on lower revenues. For the fiscal year, operating loss was $157 million, a 23% improvement over the fiscal 2005 operating loss of $203 million.
I will now discuss 3Com's non-GAAP operating loss performance. Management believes that a non-GAAP operating loss measure that excludes unusual expenses along with restructuring, amortization, and the write-down of in-process R&D is the best single measure of the performance of our underlying business operations.
When we adopt FAS 123R in fiscal 2007, we will exclude these costs as well. The reconciliation to GAAP operating loss is provided in table B in the press release.
With this definition consistently applied, the non-GAAP operating loss was $8 million in the fourth quarter of fiscal 2006, a sequential improvement of $22 million compared to the third quarter non-GAAP operating loss of $30 million, and a year-on-year improvement of $43 million, compared to a fourth quarter fiscal 2005 non-GAAP operating loss of $51 million.
The primary drivers of the reduced non-GAAP operating loss are the inclusion of two months of H-3C and continued operating expense controls inside the SCN segment.
For the fiscal year, 3Com's non-GAAP operating loss was $112 million, a 31% improvement over the fiscal 2005 non-GAAP operating loss of $164 million. The net reduction was driven primarily by improved gross profits in the SCN segment, and the inclusion of two months of H-3C.
During the period, we recorded $1 million in unrealized gains on investments for various appreciations in our private equity holdings and interest income for the period of $9 million increased sequentially by $2 million and over the prior year quarter by $3 million. This improvement was driven primarily by the interest income earned on the H-3C cash and cash equivalent balance.
Other income was $8 million in the quarter, compared to approximately zero in the previous quarter. This increase was primarily driven by the inclusion of an H-3C other income resulting from an operating subsidy program by the Chinese VAT authorities in the form of a partial refund to H-3C of VAT taxes collected from purchases of their software products.
The provision for income tax was $5 million for the quarter, versus $1 million in the prior quarter, primarily due to the inclusion of two months of H-3C.
In our fourth fiscal quarter, we recorded equity income of $3 million as our share of the financial performance of the unconsolidated H-3C joint venture for its month of January. We also recorded a minority ownership charge to our results of $11 million, as Huawei's share the financial performance of the consolidated H-3C, for its performance in the months of February and March.
The net loss for the fourth quarter was $15 million or $0.04 per share, of which restructuring and amortization expenses represents about $0.03 per share. This represents a $0.04 per share improvement sequentially, and an $0.11 per share improvement over the prior year quarter.
The weighted average number of shares outstanding during the quarter was 390 million shares. This net increase of 2 million shares from the prior quarter primarily reflects the exercise of stock options and employee stock purchases under our employee stock purchase plan.
The net loss for the fiscal year 2006 was $101 million, or $0.26 per share, of which restructuring and amortization represent about $0.09 per share. This is a $0.25 per share improvement over fiscal year 2005 net loss per share of $0.51.
Let me now turn to the review of our operating segments. Commencing with the consolidation of H-3C results, we will be reporting two operating segments: SCN and H-3C. The presentation of the results of these segments reflect how we manage these business segment in accordance with FAS 131 and are documented in table H in our press release.
Accordingly, there are certain elements of 3Com's consolidated performance which are not included in the segment operating results. These elements are reflected in the corporate non-operating segment. The segment table presented in our press release is prepared in accordance with GAAP consolidated results, and therefore, reflects two months of H-3C performance on an as-consolidated basis plus one month of equity recording of H-3C. The stand-alone H-3C performance for the month of January continues to be disclosed on the table I attached to our press release, which reviews the performance of H-3C as an unconsolidated subsidiary.
For purposes of quarterly comparisons, we have included a non-GAAP view of H-3C operating segment as if the results for the period from January through March had been consolidated. This view can be seen in table E of our press release.
I will start by reviewing the SCN segment performance, which are comparable to the GAAP 3Com stand-alone prior period results. Revenue for the quarter was $166 million, down 7% sequentially and down 6% compared to the prior year quarter. This sequential decline is primarily explained by two drivers.
First, our EMEA region declined sequentially, driven primarily by reduced network product sales. We saw increased competition in the 10/100, and gigabit markets, as well as in large project deals. We responded with list price reductions in certain gigabit and 10/100 products ranging from 10% to 25%, effective June 1st.
Second, our North America region declined overall, driven by impact of the security business performance discussed earlier, and by lower connectivity products revenue. All other product areas demonstrated sequential growth in North America.
SCN gross margins declined 4 percentage points sequentially, to 36%. About 2 percentage points of the decline are unique to this quarter, resulting from the resolution of cost issues with a service provider and the impact of lower security revenues. About 1 percentage point was due to a change in the classification of certain technical support costs from development to cost of sales. Lastly, there was about a percentage point reduction due to the combination of lower volume and price pressure, offset in part by improved cost.
From an operating loss perspective, this decline was more than offset by a reduction in sales and marketing, research and development, and general and administrative expenses, which totaled $89 million in the quarter, a $23 million sequential decline.
This decline resulted from the absence of a total of $9 million in unusual items for executive severance and impairment charges taken in the third quarter, termination of our branding campaign, other lower operating expenses due to the revenue performance, and a continuation of the reduction in our basic expense run rates.
On a net basis, this resulted in a sequential reduction in the SCN segment operating loss of $11 million. SCN net loss for the quarter of $36 million is a $21 million improvement over the prior year's quarter stand-alone 3Com loss of $57 million.
As Scott discussed in his comments, we are announcing a restructuring plan in our SCN segment to reduce certain head count and office locations. This program is expected to reduce head count by approximately 250 employees and 21 facility locations. The charge for this restructuring is expected to be between $10 million and $13 million and will be recorded over the first two quarters, primarily, of fiscal 2007.
Turning now to the H-3C operating segment, in our GAAP financial statements, we consolidated two months of H-3C results covering February and March. During this two month period, H-3C generated $108 million in revenue, $15 million in operating profit, and $22 million in net income before the Huawei minority interest charge.
In order to give a meaningful comparison, I need to use full quarter results. So I'm going to reference the non-GAAP quarterly performance numbers for H-3C for the fourth quarter set forth in table 8.
On this basis, revenue for the fourth quarter was $156 million, an 8% sequential and a 90% year-over-year improvement. The sequential increase in sales inside of China was driven by continued growth in the sale of high-end enterprise switches and routers. Sales outside of China are primarily OEM sales to 3Com and to Huawei.
From a product perspective, over 95% of H-3C's revenue is categorized in our network product category, with the balance in voice, security, and services. H-3C's gross margin for the complete quarter was 49%, up about 1 percentage point compared to the prior quarter, and up 5 percentage points compared to the same period a year ago.
The gross margin performance in the calendar first quarter continues to reflect the benefit of a strong mix of higher end switching sales directly into the Chinese market.
H-3C's direct operating expenses for the full quarter were $46 million, and amortization expense for the quarter was $8 million. Overall, H-3C had $21 million in operating income for the quarter, including the $8 million in amortization expenses.
Returning to 3Com's consolidated results, I'll now review selected aspects of 3Com's balance sheet. Cash, cash equivalents, and short-term investments totaled $864 million, representing a net increase of $158 million from the balance at the end of the previous quarter. The change includes an increase in cash and cash equivalents of $269 million and a decrease in short-term investments of $111 million.
Key components of the change in cash and cash equivalents, aside from the decrease in short-term investments, are the following:
- The consolidation of H-3C's cash, cash equivalents, and short-terms investments of $138 million as of January 31st, the start of the consolidation period.
- Cash provided by operations was a positive $15 million, comprised of $33 million positive cash from the H-3C operations, offset in part by $18 million of cash used in the SCN operations. These figures include $4 million for restructuring- related payments.
- Cash provided by the issuance of 3Com common stock was $9 million, primarily driven by the exercise of options and our employee stock purchase plan.
- Lastly, cash used for capital expenditures amounted to $6 million.
The cash changes described above include H-3C's cash activities for the month of February and March. The year end cash, cash equivalents and short-term investment balance of $864 million is comprised of $695 million from the SCN segment, and $169 million from H-3C.
The owners of H-3C, 3Com and Huawei, have agreed on a return of capital of $80 million. This is expected to be completed by the end of the calendar year following Chinese regulatory approval, and will result in an $80 million reduction in the H-3C cash, a $39 million increase in the SCN cash, and a decrease in the minority ownership liability to Huawei.
Other items of note in our consolidated balance sheet include the following:
- We are now reporting notes receivable on our balance sheet, which represent acceptances issued by major Chinese banks recorded in the H-3C balance sheet for which its March quarter end was $63 million.
- Accounts receivable increased $54 million sequentially, driven by the inclusion of H-3C's receivables, more than offsetting the decline in the SCN segment receivables.
- Inventory increased $120 million, driven by the inclusion of H-3C balances, more than offsetting declines in the SCN segment. H-3C carries higher inventory due to their Chinese direct touch model, the structure of their supply chain, and increased inventory buffers to support rapid growth.
- Accounts payable and accrued liabilities increased $162 million, driven by the inclusion of H-3C's balance sheet.
So to conclude, our H-3C segment continues to show strong performance. Our SCN segment is reducing its losses, but there remains a lot to do. Our cash used in operations has improved in the SCN segment, and when combined with H-3C, our net cash provided by operating activities was positive for the quarter.
I'd like to turn the call back to Scott Murray to start the question-and-answer session.
Scott Murray
Thank you very much, Don. Operator, I think we'd now like to open the call for questions, please, if we could.
Question-and-Answer Session
(Operator Instructions) Our first question comes from Matt Shimao - Bear Stearns.
Matt Shimao - Bear Stearns
Hi guys, how are you? First, let me just try to make sure I have some of the numbers straight. For the pro forma revenues, looking through your tables, I think I have $166 million for 3Com, $156 million for Huawei-3Com, and an elimination entry of $18 million to total $304 million?
Don Halsted
I believe that that is right.
Matt Shimao - Bear Stearns
Okay, great. So that looks good. Then looking at the EPS, starting with your GAAP loss of $0.04, I see you show your pro forma loss of $0.02. Now, when I factor in the interest and other and the taxes and the minority interest and equity interest in the JV, it looks like I'm showing actually a net loss of $0.01? Is that right for your results?
Don Halsted
Matt, I'm not sure of the calculation that you just did, because I did not actually give a pro forma number on an EPS. What I think I did was tell you how much at least the restructuring and amortization was of the $0.04, which represents about $0.03.
Matt Shimao - Bear Stearns
Okay, so your pro forma operating loss is $0.02? That's on table B, right?
Don Halsted
The operating loss is at the operating line, not at the net income line. So I generally do not express that as a per share number.
Matt Shimao - Bear Stearns
Okay. Just one more thing looking at the EPS, then. When I look at your last table, which shows the one month for Huawei-3Com that's not included in the actual results, it looks like they had a profit of $6.5 million. So if you were to include that, to look at your EPS as if you're looking at three months of 3Com and three months of Huawei, that would be an additional $0.01 of benefit to your EPS line. Am I looking at that correctly, or not?
Don Halsted
Actually, Matt, I don't think you are. Because the effect of that month of performance is reflected in the net income, but it's reflected because we had a minority interest of $3 million in the net income line.
So the only difference between January and the February, March at the net income line, is you move from 49% participation to 51% participation.
Matt Shimao - Bear Stearns
Got it, I understand. So on the operating income line, loss of $0.02, and we need to figure out what the actual EPS is by looking at the interest and other and taxes and so forth. Okay, good.
I want to ask you about the JV. So the JV had a very strong quarter. Looks like the gross margins are up 49%, annual growth, year-over-year, 90%. Looks like the pro forma operating income was 19% and net income of 24%.
Can you talk about the primary growth drivers for the JV? Looking forward over the next 12 months, would you expect the JV's primary growth drivers to remain the same or change?
Scott Murray
Sure. Let me address that for you, Matt. Clearly, what we've seen with H-3C is that it continues to do well in China, which is a very dynamic market. It has a very strong presence there. It is a very Chinese-driven business model with respect to its go-to-market. So we've been very pleased with that growth model that we've seen for them.
As Don mentioned, we are not providing forward-looking guidance, so we can't comment on what it might look like down the road. But as we look at its growth over the prior year -- and clearly it's been on a build model, with introducing new products, adding new employees, adding new customers and frankly, probably picking up a little bit of share there, as well.
Matt Shimao - Bear Stearns
Well, when we look at what's driving the strong margins, it seems like it's this high-end mix. It sounded last quarter that you didn't expect that to continue, but it has.
Now, can you comment if you expect that higher-end mix to continue? Or if it should revert to lower-end mix, and so these are basically peak margins? What are your thoughts there?
Scott Murray
Well, it ultimately depends on the mix of products that we're selling, clearly. We've been pleased with the mix that they've had to date, which is a combination of switches and routers and some of their other products for the networking space in China.
We've also not seen the pricing pressure that we've seen around the rest of the world with some of the networking space. So we feel pretty good about the historical margins. Again, not providing forward-looking guidance, but if you look at the results that we've seen for the quarter, we've obviously been pleased with them.
Matt Shimao - Bear Stearns
What about the demand trends, though? Is there a reason for customer demand to be more focused towards the higher end in China now, that would be a sustainable demand trend? What are your thoughts there?
Don Halsted
I think if you go back over the past year, and you look what are the engines that have driven the growth that they've had, the H-3C has gotten growth both from its operations inside of China and the operations outside of China. But actually, more growth from the operations inside of China.
So one of the things that's happened is we've continued to have a strong mix of our direct margins, versus what would be OEM margins outside of China. Then inside of China, their mix has been strong on the higher-end switch and router area, where they frankly enjoy better margins. That is the trends that we've seen, certainly over the course of this past year.
Matt Shimao - Bear Stearns
Okay. Now looking at the JV's head count of 4,000 what would you expect the head count to be at the end of calendar 2006? What drives the Huawei's 3Com OpEx? Is it primarily head count or are there other investments being made that would increase Huawei-3Com OpEx per employee significantly over the coming year?
Scott Murray
Sure, there's obviously a number of things that go into the operating expense around SG&A, sales and marketing, and programs that they use. As we said, there was approximately 4,000 people at the end of the year. You do create some element as you reach critical scale. It's not going to continue to grow at the same rate that it has in the past from a head count perspective, and we will get some leverage related to that. Although we do expect that to continue to grow over the coming months as the business model there builds, and they continue to grow the revenue line.
If you think about the model in China, it is a little bit different than the rest of the world. It's very focused on customer interaction, customer service; and a very direct model, as opposed to a channel-driven model. So it does have more employees, and obviously, the average pay per employee is different than it is throughout the rest of the world in Europe and the Americas.
Matt Shimao - Bear Stearns
Quickly shifting gears. Looking at the cost discipline at 3Com -- ?
Don Halsted
Matt, this has to be the last one. Because we've got a whole list of other people right behind you and 18 minutes left.
Matt Shimao - Bear Stearns
Last one. Cost discipline at 3Com. Table H, looks like your OpEx is $88.5 million. Is that a comparable number to the $103 million last quarter? What drove the savings? When you look at the 1, 500 employees is it less 250 from that number, or what is the 250 being subtracted from?
Scott Murray
The 1,550 was the number at the end of May. So the 250 is less from that. The 250 relates primarily to the SCN business. So we're taking some fairly focused efforts there with respect to that.
Don Halsted
Let me answer your first question in there, Matt. That is, if you do look at the expenses, remember in the third quarter, we had about $9 million that was one-time items. So your starting points were closer to $102 million in the third quarter. So when you look at that drop, it's about a 13% decline. Inside of that, there is $1 million or $2 million that is now classified as cost, and was part of the gross margin bridge. There is a couple of million in there that is lower operating due to, frankly, the underperformance on the revenue.
So when we get ourselves back on track there, I expect the run rate is going to be a couple million higher than the $89 million in terms of what we're starting with, but then the savings from the restructuring will kick in. These comments, by the way, are before any effect of FAS 123R, because it's not in our current numbers.
John Vincenzo
Matt, if I might suggest, we can move forward, and these have been great questions for today. We really appreciate it. Thank you.
Our next question comes from Jiong Shao - Lehman Brothers.
Jiong Shao - Lehman Brothers
Good afternoon. I have two quick questions, if I may. Could you just talk about the OpEx savings, when everything is said and done for your current restructuring plan, the 250 head count reduction and 21 facility closures, the timing for that?
Don Halsted
Thank you, Jiong. First, the reductions will be in the SCN segment. The savings are also going to focus on the non-TippingPoint part of the SCN segment, and therefore they will be offset in part by some increased spending that is going to happen in TippingPoint.
We expect to see the effect on the total SCN starting to happen in the second quarter '07. So you'll see it on the total segment line. Full implementation is over the next couple of quarters, with a payback on the restructuring charge of about two to three quarters.
Jiong Shao - Lehman Brothers
The total savings, Don, is going to be? You mentioned what the total charges are going to be over the next couple of quarters, but total savings going to be?
Don Halsted
When it's fully implemented, the net of the increases and the heritage decreases should have in that segment, from there, it will net our direct operating expenses down about 10% or so, before the effects of FAS 123R.
Jiong Shao - Lehman Brothers
Okay, great. Thanks.
Scott Murray
You have one more question, Jiong?
Jiong Shao - Lehman Brothers
Yes, thanks. My second question is on Europe. I was wondering, could you provide a little bit more color on what you see in terms of price competition. Is there any change in competitive dynamics there from existing vendors, or from the relatively newer vendors coming up from the lower end of the market?
Also relate to that, Don, I missed what you said about RoHS. I think you mentioned RoHS, but I didn't quite catch what exactly you said about that. I think the RoHS is supposed to kick in July 1st. How is that going to impact 3Com here?
Don Halsted
Where it's going to impact us is primarily in the connectivity product area, where we are basically going to end-of-life some of our products because we are not going to do the redesign necessary to make them compliant in the EU to the RoHS.
As we said, we've been on a harvest strategy in the connectivity device part of our business for, I think, the past two plus years. So we are just noting that we actually are taking the decision of ending some of those products.
Jiong Shao - Lehman Brothers
Competition in Europe, pricing pressure?
Scott Murray
It continues to be a pretty competitive market. One of the things that Don mentioned, is we made some price changes in our gig products, and 10% to 25% effective June the 1st. We believe that a focused go-to-market strategy there, with the right pricing model and the right product strategy, we'll be able to continue to be fairly competitive in the marketplace. But Europe is a fairly competitive market today.
Jiong Shao - Lehman Brothers
Thanks, guys.
Our next question comes from John Marchetti - Morgan Stanley.
John Marchetti - Morgan Stanley
How are you? One quick clarification, Don. On the 10% savings net-net, should we think of that as sort of all of fiscal '07, relative to fiscal '06? Should we expect that to slowly kick down as we go through the fiscal year? Just trying to get a sense for when we should be at sort of that 10% lower level?
Don Halsted
It's going to be trending down, literally, over the course of the next two, three, four quarters.
John Marchetti - Morgan Stanley
Okay. Scott, now that you've been there a few more months, if you could just give us a sense, you're starting on the SCN business now. You mentioned trying to beef up some of the TippingPoint stuff.
Do you feel like this is the right track that you need to be on to get all this business set in line, just keep pushing on the H-3C business, get TippingPoint actually up a little bit higher, and really realign the cost structure of the SCN business?
Scott Murray
Really well said. Clearly, it's a continuous process of looking at the business, both investments and managing our costs carefully. As I said earlier, there is still work to be done, but the restructuring announced today is a good step to aligning the business model with the current realities in the marketplace.
We do continue to invest in TippingPoint, and we'll be investing in sales and continuing R&D there on many of the new product offerings, and also continue to invest in H-3C.
But I think we've taken a fairly realistic look at our business, and a combination of a number of factors around go-to-market discipline, verticals, cost realignment, looking at the number of sites. As we may have said in the past, we've got over 60 sites. So by consolidating 20 sites, there's all sorts of ancillary costs related to that, as well.
So it's really not just a head count exercise. It's a business definition discipline around how we're going to run the business, the ROIs with respect to marketing and channel program, the type of products that we're bringing to market. The CD program that Don mentioned was a great example as we look at the economics of some of these products and make some tough decisions, but they need to be made.
John Marchetti - Morgan Stanley
And then if I could have just one last follow-up here, Scott.
Scott Murray
John Marchetti - Morgan Stanley
In terms of broadening the sales funnel or the channel for the H-3C products outside of China, as you look at where you are today, how much work do you think needs to be done on that side of the business to try to get the H-3C products out to a broader market?
Scott Murray
Well, today, 3Com is selling many of those H-3C generated products through the development labs that come out of H-3C. Some of our 5500 products, our switching products, and building those under the 3Com brand, and the H-3C brand is the primary brand within China.
We are looking at some other emerging European and emerging APR-based countries. But as Don and I said in our remarks, H-3C is primarily focused on China and growing that business. There are clearly are going to be international opportunities where we work jointly with them on go-to-market strategies and bringing products to bear, some of which are being developed today around extended switch and router technologies for not only Chinese markets, but for international markets as well.
John Marchetti - Morgan Stanley
Thank you.
Our next question comes from William Becklean - Oppenheimer.
William Becklean - Oppenheimer
Hi, how are you? It sounds to me like in the markets outside of China, the strategy's changed a little bit from trying to drive the business up into the low end of the enterprise business. Broadly, it sounds like you've retreated and are now trying to focus on vertical segments to try and bring the broad product line.
A second piece of the question, at the very low end of the market, are you still trying to develop product down there, or are you willing to give up the low end of the market?
Scott Murray
Two good questions. We are still focusing on the enterprise space, both through our own channels. But as we look at markets where we believe we can be competitive and build share around specific verticals, we've selected markets like government, education, healthcare, amongst the other ones that we're working with.
We're still working with our channel partners, our systems integrators, and other partners for these medium and larger enterprise customers. TippingPoint is another great example that is very aligned with many large enterprise accounts and creates a pathway into there.
Clearly, H-3C has built enterprise business within China with their applications for extension. Within the lower end of the business around some of the office connect products, we continue to invest in those, and frankly have a pretty good SMB business taking those to market, and we're going to continue to do that, obviously.
William Becklean - Oppenheimer
Okay, thanks, Scott.
Our next question comes from Manny Recarey - Kaufman Brothers.
Manny Recarey - Kaufman Brothers
Good evening. Three questions. Can you tell me how much revenue was a result of the H-3C products through 3Com? I think it was about $30 million in the last quarter?
Don Halsted
Yes, and we're increasingly not going to be trying to drive that, because you can pick some of it up from the eliminations. But for this quarter, that number was up pretty significantly. It was up closer to $40 million than $30 million.
Manny Recarey - Kaufman Brothers
Okay, great. Two other quick questions. Can you give any comments on the U.S., on the overall spending environment? Were enterprise customers reluctant to spend? Any comments on that, please?
Scott Murray
Well, we think it's still a relatively competitive market out there, and we are building share within that. I think you can look in the press on various analyst reports on that. We are seeing the security business, which has an element of calendar seasonality to it, you'll see more year-end spending in frankly, the month of December, than you will in the first quarter. So there's some seasonality in that.
Manny Recarey - Kaufman Brothers
Okay. And then one last question. Any comments that you have about Huawei's acquisition earlier this month of Harbour, which I believe makes some products that are competitive with the joint venture?
Scott Murray
Well, as you can appreciate, I hope, I really can't comment on the status of what Huawei is doing, because it is a separate entity. We do point out we've been satisfied with our partnership with them, and satisfied with H-3C.
As we look at publicly available information on their website and industry knowledge, we do believe that the Harbour acquisition was relatively small in the enterprise market in China, and for the most part, that was carrier-based assets that they were interested in. But we really don't have any other information to which you probably have from a public perspective related to that.
Manny Recarey - Kaufman Brothers
Okay, thank you.
Our next question comes from Long Jiang - UBS.
Long Jiang - UBS
Hi, good afternoon. Can you articulate your target operating margin for the 3Com business after all this restructuring is said and done? That's my first part of the question.
Don Halsted
We said at the beginning, we were not going to be providing the forward-looking guidance. So unfortunately, I'm going to decline to answer that.
Scott Murray
But we did give some sense around some of the impact on the restructuring.
Don Halsted
I gave some run rates, and those were entering the quarter, run rate in the neighborhood of a 38% margin. I gave an idea on the expenses, and then we're obviously working on those areas.
Long Jiang - UBS
Okay. Of the $7 million other income primarily from the JV, do you think it's going to stay at the same level in the foreseeable future, or do you think it's going to eventually go away?
Scott Murray
Well, we've been obviously pleased with that, and as Don said, we're not providing forward-looking guidance. But there is a mechanism within China that you can receive these VAT refunds based upon existing spending levels, is how that works.
Long Jiang - UBS
How much of your JV sales are done through the Huawei resale channel? If you can further break it down between China and overseas, and between low end and high end, that would be great. Thanks.
Don Halsted
It's a good question. We're actually right in the process of looking to determine what we really need to disclose in our 10-K, related to related parties. So I'm going to defer on that, other than I'll say that there's a reasonably significant channel outside of China, and they are also a channel to the carrier markets inside of China.
They have as a consistent route to market in China, as what they have outside of China. We're going to be working through exactly what we need to disclose relative to related parties as part of putting our 10-K preparation together.
Scott Murray
I think it's also important to add that the model in China is different from a channel partner perspective. There's a preponderance of revenue there that comes from a direct touch, direct to customer model, which is why you'll end up with more employees on a percentage of revenue basis than you might otherwise have.
Don Halsted
Basically all the enterprise sales is a direct H-3C sales model that is assisted by some of the channels. It's related to carriers that you get using 3Com, or the Huawei channel legitimately, as that's where their markets are.
Long Jiang - UBS
Okay, thanks Scott and Don.
Scott Murray
Thank you. Operator, I think we're going to take one more question as our time is starting to run out here.
Our final question comes from Mark Sue - RBC Capital Markets.
Mark Sue - RBC Capital Markets
Is there an element of seasonality in the H-3C business? How should we look at that from a quarter to quarter basis, if you could help us out there?
Scott Murray
Terrific question. There is a little bit in particular around Chinese New Year and some of the holidays that they have there. Clearly, as that market is growing -- and if you look at any of the analyst reports that track that market, it is one of the fastest growing markets in the world. We think that we have a very attractive offering for our customer base in that market.
Mark Sue - RBC Capital Markets
Separately, you mentioned increased competition in Europe. Who's the aggressor there? Is it HP, Cisco?
Scott Murray
I think probably the biggest competition obviously for us is Cisco. Not just in Europe, it's around the world. They are the biggest player in the market. Probably as we look at the competitive landscape, the most competitive.
Mark Sue - RBC Capital Markets
Got it. And then the pricing pressure and the subsequent impact on gross margins, is that the biggest drag on gross margins? How should we see that where you have the benefit of H-3C and the mix of the other high-end products? Any qualitative comments on gross margin trends through increased competition?
Don Halsted
One of the things that I highlighted in the comments, and we went through the reasons that our margin dropped, there was about a percentage point drop in margin due to a combination of volume, price pressure offset by cost improvements.
The real issue is, what's the difference in your price pressure versus the underlying cost pressure? And that in aggregate, cost us about a percentage point in the last quarter.
The real message behind that, is we are definitely seeing a lot of price pressure. We are also seeing some ability to reduce some of the underlying costs as well, which is one of the drivers, industry-wide, of some of the price pressure.
Mark Sue - RBC Capital Markets
I see. Okay, that's helpful. Thank you very much, gentlemen, and good luck.
Scott Murray
Operator, at this time I would like to close the call. I would like to end by thanking everybody for joining us today. We appreciate the good questions, and the time to address the investment community. So thank you very much, everybody.
Ladies and gentlemen, we thank you for joining us today. That does conclude our presentation. We ask that you please disconnect your phone lines at this time.
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Henry G. and Bertha Iona Slaughenhaupt Stamm Wedding 1900
Bertha Iona Slaughenhaupt, born 1876, died 1929, married Henry Stamm in 1900.
Henry Stamm, only son of Levi S. and Mary J. Strickler Stamm, born 1857, died 1942. He was a farmer and a teacher in the New Hamburg area. Henry and Bertha lived on farm, that was probably purchased from Bertha's father, Emanuel Slaughenhaupt.
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subset: commoncrawl


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Thea Hogarth '11
Major: Comparative Literature, Minor: French
What is your current job?
I currently work in product development at a children's media company called Little Pim. We produce an educational foreign language video series for kids between the ages of 0 and 6, and my main role is to coordinate the creation of ancillary educational products like flashcards and lesson plans for teachers.
(Of course, working at an ed tech start up, I do a lot of other things too! Lately, I've been helping write a lot of marketing copy and contributing posts to our social media pages.)
How has Haverford influenced your professional career?
My major in Comparative Literature definitely sparked a larger interest in languages, which has evolved into an interest in bilingualism and biculturalism. Even thinking back on my thesis topic, I can see how I was grappling with questions of language an identity that I still think about in some of the research I do now.
Working with the Hurford Humanities Center at Haverford also taught me a lot about independently organizing creative endeavors which is coming in handy now as I organize teams of freelancing creatives for various projects.
To learn more about Thea's career path, visit her Alumni Career Profile on the CCPA website.


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Diversity and efficiency: the elements of ecologically intensive agriculture
A six-year study in Cuba has shown that increasing a farm's diversity, for example with a mixed crop-livestock system, increases its overall productivity, energy efficiency and nutrient management. Equally important, it reduces risks, in particular when compared to simplified and homogeneous systems. Mixed systems draw various ideas and lessons from traditional farming systems found in many parts of the world. The Cuban case, at the same time, provides many lessons, especially when regarding the design and management of diverse systems.
LEISA Magazine • 25.1 • March 2009
Whether we look at small-scale farming or at large commercial enterprises, designing a sustainable and equitable agricultural system poses continuous challenges. The farming model most commonly promoted throughout the world, based on simple and homogeneous systems, has notoriously failed in terms of sustainability and equity. Where it hasn't failed, but has increased total agricultural production in some countries, it is because this production has been subsidised in one or more ways. Subsidies, whether monetary, or in terms of over-exploitation of resources, absorb the costs of reducing the agroecosystem diversity. At the same time, aspects like environmental pollution, land degradation or rural poverty are disregarded.
Small-scale family farmers have not benefited much from this model. Attempts to improve the performance of smallscale agriculture based on simplified, homogeneous and subsidised systems have often failed due to, among other reasons, limitations of scale. Small-scale farming, therefore, still comprises a diversity of livelihood strategies, diverse land use, management and marketing strategies, the integration of different types of activities (e.g. crop-livestock interactions), intercropping and rotating crops and crop cultivars, or the maintenance of agro-diversity on the farm. Efficient use of the natural, economic and social resources - which goes beyond the efficient use of only a certain input - relies on one or more of these diversification strategies.
Lessons from elsewhere
As in many other countries, policies and development programmes in Mexico have encouraged the simplification of agricultural systems. Nevertheless, diverse farming systems are very common, and they contribute to the livelihood of the rural population and to the country?s overall food production. For example, in the highlands of Michoacan, the Purhepecha people have relied on diverse agro-silvo-pastoral schemes for thousands of years. Each household has a diverse herd, including horses, chicken and dual purpose cattle. Livestock is partially fed with crop residues and, in return, manure is used in the fields where crops are grown, to restore soil nutrients and organic matter. The cropping subsystem is normally based on two fields, of about 3 to 4 hectares each, with alternating fallow. In the fallow field, cattle graze maize stubble after harvest during the dry season and, in the cropped field, a mixture of maize varieties, beans and squash are grown together in a mixed cropping pattern known as milpa.
When evaluated, these traditional systems display many advantages, especially when compared to "simplified" systems. They require few external inputs (occasionally some fertilizer and labour for specific tasks such as maize harvest). Although the production of maize, milk, meat and wood might be slightly lower than on specialised farms, resources such as land, labour and inputs are more efficiently used. Nutrient cycles are more efficient, allowing their capture and assimilation by different components of the system and in different forms. Just as important, a diverse system provides the household with various goods for consumption or market, ensuring food self-sufficiency and a reliable and resilient production of cash income in the long term.
There is plenty to learn from small-scale production systems, particularly in terms of the role that diversity plays in making them more productive, reliable and efficient (see Box). Some of these lessons are being taken up in Cuba, where the agricultural sector has been moving in a "different" direction for almost two decades. This change in direction was initiated by the sudden disappearance of subsidies after 1990. After that, a severe energy crisis created the conditions for coming up with a new model of agriculture that relies heavily on agrodiversity. This emerging model may contribute to the design of sustainable systems around the world.
Cuba's path towards diversity
The economic crisis that started in 1990 in Cuba had a big impact on agriculture. Various alternative systems were proposed in order to tackle the difficulties which agricultural production was facing. However, they all showed a common characteristic: they followed an input substitution scheme, in which highinput industrial practices were substituted with organic inputs. These early attempts then led to a new approach, based on the systems seen in Mexico and elsewhere: converting specialised (monoculture) and often centrally-managed farming systems into mixed, diversified (and small-scale) farming systems.
Mixed farming systems are now presented as an effective step towards implementing sustainable practices in Cuba. They aim to maximise the systems' diversity, emphasise soil fertility conservation and management, optimise the use of energy and the locally available resources, and are highly resilient. In short, they are based on three main principles: (a) diversification, by including crops, trees and animal species, (b) integration, considering the dynamic exchange and recycling of energy and nutrients among the different components of each system, and (c) self-sufficiency, referring to the extent to which the system is able to satisfy its own needs without requiring considerable external inputs.
A six-year study followed the transition from "conventional" farming systems to mixed systems, looking at the opportunities for improving productivity while at the same time enhancing sustainability and equity. This started at the Pastures and Forage Research Institute in western Havana, where two prototype mixed farms of one hectare each were established within a 15 ha dairy farm, with 25% and 50% of the total area devoted to crops. The study used different indicators to assess aspects such as biodiversity, productivity, energy use or financial performance. While all measurements showed clear results (a more intensive use of the available resources through diversified systems contributes to food self-sufficiency and to the efficient production of marketable products), we wanted to see if similar results could be attained on real farms. So we looked at 93 farms, varying in size, proportion of area allocated to arable crops, and in the stage of "conversion" to mixed farming. These farms were found in five different provinces, representing the country's major agro-ecological zones.
A thorough evaluation showed that mixed farms are more productive, more energy-efficient, and manage nutrients better, than farms specialising in dairy products or a certain crop. There were, however, many differences between these cases, mostly depending on the percentage of the area used for crop production in each farm. The farms with the highest proportion of land under crops achieved the highest values of productivity in terms of milk yield per unit forage area, energy output and protein output. Farms with more land under crops demanded three times more human labour, but the overall energy cost of protein production was lower, energy use efficiency was higher, and a more intense use of organic fertilizers was needed. This was mainly due to including crops in systems which were previously pasture-based, which was a precondition to further increases of energy outputs.
The conversion from a specialised farming system into a mixed farming system follows three principles: diversification (by including crop, tree and animal species), integration (by dynamic exchange and recycling of energy and nutrients among systems components) and the achievement of food self-sufficiency.
Photo by: Fernando Funes-Monzote
Higher proportions of farmland dedicated to cash crops also resulted in higher values for the agrodiversity indicators (such as "diversity of production" or "reforestation index"). Under the conditions of low inputs and high uncertainty in which these farms have to operate, this higher diversity greatly contributed to reducing risk and increasing productivity. Both internal and scarce external resources were used more efficiently in the mixed farms than in the specialised ones, and the diversified farms were more efficient in the use of energy, lowering the energy costs of protein production.
These results showed that when comparing different systems, the issue is not only one of high or low inputs, specialisation or diversification. Equally important is how the specific characteristics of each farming system, the necessary inputs and its agro-diversity are interrelated and managed – in particular, by farmers themselves. In deciding on the proportion of the farm area to be used for crop production, for example, farmers considered factors such as land availability, stocking rate and animal feed balance on the one hand, and soil characteristics, productivity of forages and availability of crop residues, on the other. Market constraints, sales contracts with the state, as well as other socio-economic factors also played a role in deciding the degree of conversion from specialised to diverse farming systems. Managing higher levels of agrodiversity also required design skills and more dynamic decision-making, which led to the empowerment of farmers. In addition, the better allocation of feeds and labour throughout the year contributed to improved resource use efficiency.
Lessons of global relevance
Optimal use of resources for both crop and animal production helps to achieve food self-sufficiency while at the same time yielding marketable products that contribute to household income ? without degrading the environment. After only a few years, these highly diverse, heterogeneous and complex small farms are already proving to be substantially more productive and efficient than specialised crop or livestock systems. About 65% of the food produced and marketed locally is grown nowadays by small-scale farmers who cultivate half of the total land in use by agriculture in Cuba.
The many forms and scales of diversity associated with family agriculture play an important role in sustaining rural livelihoods. A quick examination of the many different traditional farming systems shows how agrodiversity is always inherent, and contributes importantly to their sustainability. It guarantees a more efficient use of the local resources, reduces dependence on external inputs while conserving biological resources, and reduces risks. Agrodiversity also plays an important role in the preservation of local knowledge and empowerment of farmers, as diverse agricultural systems are knowledge-intensive and require complex, dynamic and adaptive decision making. These systems need to be thoroughly analysed for their potential to provide services of global relevance, such as carbon sequestration or biodiversity conservation, or for preserving our cultural heritage. Mixed farming systems should be the primary target for protection and subsidies.
But the potential benefits of agrodiversity are not only limited to traditional, smallholder family agriculture. The lessons learnt from the conversion of Cuban agriculture show the opportunities that diversity offers in the design of more sustainable agricultural systems at a much broader scale. The unique position of the Cuban agricultural sector, both nationally and internationally, provides lessons that are highly relevant to the rest of the world. The instability of oil prices, climate change, or the ever-increasing prices of food in the international markets, combined with national awareness of the necessity to substitute food imports for nationally-grown food, opens up a wide spectrum of possibilities for disseminating alternative systems at a nation-wide scale. Diversification, decentralisation, and the movement towards food self-sufficiency, are the response of Cuban agriculture to the current local, international and global context: the very same context that threatens agriculture and food security worldwide today.
Text: Fernando Funes-Monzote, Santiago López-Ridaura and Pablo Tittonell
Fernando R. Funes-Monzote."Indio Hatuey" Research Station, University of Matanzas, Central España Republicana, Perico, Matanzas, Cuba.
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Santiago López-Ridaura. INRA, Agrocampus Rennes, UMR 1069, Sol Agronomie Spatialisation, F-35000 Rennes, France.
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Pablo Tittonell. Centre de coopération internationale en recherche agronomique pour le développement CIRAD, Persyst, TA B 102/02, Avenue Agropolis, 34398, Montpellier cedex - 5, France.
E-mail: firstname.lastname@example.com


text:
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SB Staff in Costume - Happy Halloween!
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Here are some pictures of Eddie and I totally pulling a MacGyver, all for a couple cups of coffee. We do love us some Stumptown!
Labels: fun awesomeness
21st Annual Memorial Weekend Celebration!
Friday, May 27th 2011 by
It's nearly here! Join us in our courtyard Saturday-Monday for a weekend of barrel tasting, fabulous wines, lively music and great grilled food by local favorite, the Rib Slayer! The Sokol Blosser family and staff will be here to welcome you and guide you through our delicious portfolio of current releases and hard to find gems - and don't forget barrel samples of our 2010 Pinot Noir, only available Memorial Day weekend!
Entry is $15 and includes barrel samples and wine tasting; entry is complimentary for Club members and up to 3 guest. We're open 10am-4pm each day (rain or shine - we'll be under the Big Tent!), and large groups are welcome - so bring your friends and be prepared to have a great time!
Press Release: Sokol Blosser Winery Partners with Portland-Area Cycling Team
Thursday, April 12th 2012 by
DUNDEE, OR - April 6, 2012 - Pioneering Oregon winery, Sokol Blosser, has joined forces with Willamette Valley-based cycling team Veloce Racing. The Winery will be supporting Team Veloce with wine contributions, including offering 1.5L magnum bottles of Dundee Hills Pinot Noir as lap prizes at upcoming racing events.
Founded in 2003 by a group of four cyclist friends who lived across the street from Veloce Bicycles, Team Veloce now comprises twenty-five men and women who participate in a variety of disciplines, including road and stage races, criteriums, time trials, and mountain bike races. Veloce cyclists are known for their success in cyclocross racing.
The team and the owners of Sokol Blosser share a deep passion for bicycle racing and wine. We are proud to get to represent one of Oregons oldest wineries. Sokol Blosser will be contributing product that the team would like to use as donations and prizes at races to help raise the visibility of both the team and Sokol Blosser, said Michael Benno, team rider and board member.
Second generation winegrower Alex Sokol Blosser stated, Were excited to sponsor and support Team Veloce this year. Personally, Ive held a lifelong passion for cycling and remember watching the Tour de France every year growing up. Team Veloce is a group of very friendly people and who are also very competitive cyclists. Go TV!
Title sponsors of Team Veloce include Veloce Bicycles and Smith & Nephew Orthopedics. More information on Sokol Blosser Winery can be found at sokolblosser.com. For information on Team Veloce, visit facebook.com/pages/Veloce-Racing-presented-by-smithnephew/70271992582.
About Sokol Blosser Winery
The Sokol Blosser family planted their first grapevines in 1971 in the Dundee Hills and now farms over 85 certified Organic acres. As one of the pioneering wineries of the region, Sokol Blosser has played a key role in developing and shaping the now prominent Oregon wine industry. The winery works to create wines of world-class quality, produced in a sustainable manner, which reflect the distinctive flavors of the grapes, soil, and climate, as well as the winery's values and sense of place. The winery produces Pinot Noir, Pinot Gris, proprietary blends Evolution White and Evolution Red, along with small quantities of Single Block Pinot Noirs. Learn more at sokolblosser.com.
Labels: awesomeness fun
Alex in Sweden - Pt. 2
Wednesday, April 25th 2012 by Twix , Wine Poodle
Wild caught Sweden Salmon served with Foie Gras on top on a bed of Lentils!!! I was amazed at how good this combination tasted and the rest of the meal was amazing! This all went down last night at 19 glas, which is one of the top restaurants in Stockholm, Sweden. It is located in the old town so was very charming to walk to!!!
Labels: awesomeness travel food fun
Operations Team Luncheon
Friday, April 20th 2012 by
The Operations Team took a trip Golden Valley Brew Pub in McMinnville for lunch today, and was so excited to find Evolution 15th Edition as the featured wine on the menu. We wanted so badly to get a bottle for us to enjoy over lunch, but I decided it would be best to try their Twisted Lemon Iced Tea and Cajun Prawn Pasta. All of the food looked so good and Brooke and Kristine tried the fresh Mushroom Ravioli which was amazing, Cody enjoyed the Fettuccine Alfredo, and Scott had an awesome looking Tuscan Chicken Sandwich.We all really enjoyed the yummy lunch and fine company.
Not Your Normal Pizza Night
Thursday, May 10th 2012 by
We in the tasting room get to talk about wine and food all
day. Im elated that I get to do this as my job but sometimes (okay
always all the time) we like to drink and eat the wonderful treats we talk
about all day. Thus, the first of hopefully many pizza nights was born when the
tasting room sales associate team had pizza dinner at Eddie Zavestoskis house. You all have seen him pour wine but have you
seen him make a pizza?
Eddies homemade harrisa sauce, artichoke hearts, goat cheese, green onion, zatar spice and prosciutto pizza. The perfect amount of zingy spice for this exotic pizza.
The night was made even better when host and cellaring guru, Eddie, pulled out a 1994 Sokol Blosser Redlands Pinot Noir. It was surprisingly youthful and had held onto its deep gem tone color. This pinot was the epitome of forest floor funk and was stellar with the Tartufo and truffle pizza. The 94 reminded me of how much I love Oregon Pinot Noir and just how well it can age given the right conditions.
The night was a success and Ill speak for the rest of the tasting room staff when I say Im pretty sure this means pizza night will become a monthly tradition for us. Come by the tasting room and talk food and wine with us and pass on your pizza tips!
Evolution White + Indian Food = Perfect Summer Pairing
Monday, July 2nd 2012 by
The tasting room staff has been thinking a lot about Evolution White lately. In anticipation for summers arrival to the Willamette Valley (which Oregonians know doesnt start til July 5th) we decided to have a dinner party surrounding the wine we all cant wait to drink in the sunshine Evolution White. We love Evolution paired with countless dishes (think sushi, Thai green curry and Cajun spices on the grill) but we all jumped at the thought of an Indian food feast paired with Evolution. So once again, the fine foodie folks of the tasting room gathered to Eddies house for a spicy, flavorful and fragrant evening of Evolution White and regional Indian food.
An appetizer of onion pakoras with spicy chili aioli were a perfect foil for Evolution White and started off the evening meal.
Although the evening was centered on Evolution White, we couldnt help but open a bottle of 2009 Sokol Blosser Pinot Blanc (bottle in background). The tropical fruit notes of the Blanc were an ideal complement to the Peach Curry and spicy Palak Paaner (left).
Eddies stove is loaded with pots and pans. Peach Curry, Channa Masala, Palak Paaner and Arhar Daal were served on lemon basmati rice (right).
Toasting to a successful summer spread and the eventual coming of sunshine to the Pacific Northwest (left). Cheers!
Eddies Carrot Cardamom Pudding was an incredible end to the Indian food feast. It was delicate and refreshing with just the right amount of custardy-sweet (below).
Recipe created by Eddie Zavestoski
Carrot Cardamom Pudding
1 pound carrots, peeled and shredded
¾ cup sugar
1 cup heavy cream
2 cups whole milk, divided
1 cup rice flour
1 tsp cardamom (to taste)
¼ tsp saffron
1 tsp rose water
Pistachios and almonds to garnish, toasted
Warm up 1 cup of whole milk in microwave or on stove and add the saffron to the warm milk. Set aside while the saffron dissolves into the milk. Meanwhile, dissolve sugar in 1 cup water over medium low heat on the stove. Once it looks like sugar has dissolved, add carrots to the same pot and cook until carrots become mushy, approximately 30 minutes. When carrots are cooked all the way through, add saffron milk infusion, heavy cream, cardamom and rose water. Stir to ensure all ingredients are properly mixed then blend contents. An immersion blender is ideal, however, transferring to a blender works just as well. Blend mixture until smooth and there are no chunks of carrot remaining. Return the now smooth mixture to the pot over low heat and add flour ¼ cup at a time, whisking constantly to integrate. After all flour has been whisked into the mixture, add the remaining cup of whole milk to thin out until you have reached your desired consistency. Think standard pudding: it can be more or less runny depending on personal preference. Chill the mixture in the fridge for at least a couple of hours to allow pudding to set. Pudding can be chilled for up to 2 days. To serve, spoon pudding into individual ramekins and top with toasted pistachios and almonds. Nuts can be toasted in oven, but keep an eye on them as they can burn.
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Jeff Bauman had his legs blown off at last month's Boston Marathon. When he woke up in the hospital a few hours later, he asked for a pen and wrote a note to the FBI that would lead to a quick identification of the two bombing suspects. Carlos Arredondo, the "hero in the Cowboy hat" from that famous but gruesome photograph, treated Bauman's wounds in the initial aftermath of the blast and rushed him to an ambulance. Those two threw out the first pitch before tonight's game vs. the Phillies at Fenway Park:
Rangers sign Carlos Gomez to a one-year, $11.5 million deal
Ken Rosenthal of FOX Sports reports that the Rangers have signed outfielder Carlos Gomez to a one-year deal. Joel Sherman of the New York Post reports that Gomez will earn $11.5 million next season.
Gomez, 31, struggled with the Astros to a .594 OPS before the club released him in mid-August. The Rangers signed him shortly thereafter and were immediately rewarded. Gomez hit .284/.362/.543 with eight home runs and 24 RBI in 130 plate appearances through the end of the regular season.
As presently constructed, Gomez would likely take over in center field with Nomar Mazara handling left and Shin-Soo Choo in right.
Report: Diamondbacks close to signing Fernando Rodney
Jon Heyman of FanRag Sports reports that the Diamondbacks are close to signing free agent reliever Fernando Rodney.
Rodney, 39, has been inconsistent over the past two seasons. This past season, he was lights-out with the Padres, posting a 0.31 ERA in 28 appearances. After the Marlins acquired him at the end of June, he struggled to a 5.89 ERA in 39 appearances.
Brad Ziegler, who closed for the Diamondbacks in the first half last season, went to the Red Sox in a midseason trade and is now a free agent. The Diamondbacks had six other relievers register a save, but only Daniel Hudson and Jake Barrett recorded more than one. Adding Rodney will give the club some stability in the ninth inning.


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ATLANTA -- Hispanics often hold tight to myths that affect their food-buying habits, and retailers have much to gain by dispelling those myths, panelists said here at the Annual Meat Conference, March 9 to 11. Pete Lara, director of perishables, at 50-unit Fiesta Mart, Houston, explained how his company works closely with dietitians to clear up misconceptions and deliver a nutrition message to its Hispanic customers. Lara's fellow panelists were Melissa Southern-Garcia, registered dietitian ...
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by Jackie Hershwitz
Children are more apt to be obese when they have higher levels of phthalate in their bodies, recent research shows.
Children with the highest blood levels of DEHP, di-ethylhexyl phthalate, had nearly five times the odds of being obese compared with children who had the lowest levels.
Phthalate, a common industrial chemical used to soften plastics, can be found in pacifiers, children's toys, plastic food packages, vinyl flooring and even in personal care products, including soap and shampoo. Phthalates can leach from the products and be ingested, breathed or absorbed through the skin.
About the Study
Dr. Park and colleagues looked for a correlation between exposure to phthalates and childhood obesity. They measured the levels of DEHP in 204 children, ages 6 to 13 years. One hundred five of the children were obese and 99 were at a healthy weight.
The researchers divided these DEHP measurements into four groups from the lowest detectable level to the highest. They found that the obese children had a significantly higher average DEHP level than did the nonobese controls. A high DEHP level correlated with body mass index and percentage of fat mass.
You might be thinking that the heavier children were less active or had a poorer diet. The study indicates otherwise. The increased risk of obesity with elevation of DEHP levels was independent of such factors such as physical activity and daily calorie intake, according to the authors.
Phthalate Concerns
Previous studies have associated phthalate exposure with endocrine disruption and asthma, early puberty in girls, and learning disabilities. Prenatal exposure increases a child's risk of developing eczema. Now exposure contributes to childhood obesity.
Many experts believe that these findings underscore the need to phase phthalates out of consumer products and construction materials.
Although specific baby and toddler products sold in the United States and the European Union can no longer contain certain phthalates, the ban may not adequately protect children.
Limit Your Exposure to Phthalates
Buy phthalate-free cosmetics, personal care products, cleaning products and detergents. Manufacturers aren't required to list phthalates on the label. Look for companies that pledge not to use these chemicals.
Avoid buying plastics that could be treated with phthalates, including vinyl toys, shower curtains and gloves. Look out for "PVC," "V" or the"3" recycling code on the item or its packaging.
Instead choose products and toys such as phthalate-free Legos or those made of unpainted solid wood and finished with tung oil or beeswax blocks. Ask for dolls that are phthalate-free.
Eat less processed food. Make it yourself, from scratch. Food containers and preparation methods can contribute to phthalate levels.
Buy plastic wrap and bags made from polyethylene. Store food in glass containers or plastic containers marked with recycling codes other than the #3. If you use plastic containers, do not heat or microwave food in them.
Air it out. Indoor air tends to have higher contaminant levels than outdoors. Open your window a few minutes each day and ventilate the house.
Choose an eco-healthy childcare. Choose a daycare committed to reducing potentially harmful toxics in their facility.
Wipe it up. If you have vinyl flooring, damp mop regularly. Phthalates bind to the dust particles on the floor. Direct sunlight causes faster release of DEHP, so place or lower blind on windows that shine directly on the floor.
Choose PVC-free building materials.
Take action. Urge your legislators to support reforms that would tighten up regulation of problem chemicals and require testing of new chemicals before they're allowed for use.
Do you try to limit your child's exposure to phthalates and similar chemicals? How do you do it?
Medical references:
- Park, Mi Jung, et al. (2012, June 26). "Phthalate, environmental chemical is linked to higher rates of childhood obesity." Endocrine Society. Retrieved July 11, 2012


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Here's a recording of Paul Oakenfold's visit to Gatecrasher in Birmingham (UK) as part of the 'Perfecto Vegas' tour. Paul played this set between 1-3am...
This comment has been deleted.
6184stanly5 years agoReplyReport spam
brainbug and way out west mixes sent all of us into ecstacy,what a night.how can i get this set mate?great site too
Comment reported as spamThank you for your help!


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Supporting Increased Nitric Oxide!
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PDE-5 often causes men to suffer from a lack of prolonged erections. However, VPX AEX NO blocks the production of PDE-5. This allows for better and more intense erections! Prolonged pumps are awaiting you, along with increased nutrient support. There really is nothing to lose and obviously a whole lot to gain!
Supplement Facts
Serving Size: 4 Capsules
Servings per Container: 45
Amount per Serving:
Calories - 0
Total Carbohydrates/sugar - 0g
Total Fat - 0g
Proprietary Blend - 3,200mg
Arginine ethyl ester HCI
Cnidium Monnier
L-Nor Valine
Folic Acid
For top results use two to three servings of AEX NO per day. This includes non-training days. Prior to training, AEX NO can be used as a stand alone supplement to maintain proper nitrogen balances between meals.


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The key to gaining strength and mass is really no secret: In a nutshell, you need to train smart and eat smart. That's why serious bodybuilders make sure they exercise correctly and eat plenty of high-quality protein. What isn't so obvious is the fact that eating a variety of protein is as important as doing enough repetions. I'll explain why, plus give you all the information you need to expand your nutritional horizons with emu, buffalo, ostrich and a host of other nutrient-packed, perfomace-enhacing proteins.
Variety Energizes Mind and Body
"Even though we know certain foods are healthful, we haven't identified all the beneficial substances in foods, so eating a varied diet is an insurance policy for good health," says Nancy L. Cohen, PhD, RD professor of nutrition at the University of Massachusetts in Amherst. "People who rely on supplements, or eat the same foods over and over, are more likely to miss out on beneficial but unidentified compounds, and consume too much or too little macronutrients (protein, fat and carbs) or micronutrients (vitamins and minerals).
You might think that pro bodybuilders eat only chicken and tuna, but most know that consuming a variety of protein-rich foods helps them do two things. It allows them to not only ingest a wide range of valuable bodybuilding nutrients – including some that we don't even know about yet – but consume enough protein, about 1 gram per pound of bodyweight daily for muscles repair and growth. Many pros eat much more than this daily amount.
Nutrient & Taste Comparison
Muscle cannot grow by protein alone. That's why the "Nutrient Comparisons", in addition to indicating each food's protein content, shows whether it's a good source of three key bodybuilding micronutrients: Vitamin B6 to turn food into fuel, iron to carry oxygen to muscles, and zinc to promote growth. But taste counts, too, so a group of athletes sampled the protein foods on our list and ranked buffalo, duck and emu as their top three favorites. Bon appetite!
Beef is a good source of Vitamin B6, iron and zinc, but most cuts are loaded with fat. For leaner beef with all the vitamins and minerals, buy round tip, which has less fat than sirloin, and "select" cuts, which are leaner than "choice" cuts.
Technically called North American bison, this meat was hailed the winner by each of our tasters. Try it just once and you'll know why It provides as much B6 and iron as beef, but has a richer flavor and less than half the fat. What's more, it's reasonably priced: steaks start at $7 per pound, ground meat costs much less, and jerky for pre and postworkout snacking runs just 79 cents to $6.90 per package.
What can we say about its taste and nutritional profile except ho hum?
This was the surprise third-place winner because our tasters expected something stringy and greasy Yet the White Pekin breasts lightly drizzled in marmalade sauce were delicious and lean, with a firm, almost spongy texture (one taster enthusiastically called it succulent).
Turns out that over the last decade, the White Pekin duckling producers, who raise about 95% of the ducks for consumers, developed a leaner, more nutritious bird. They're now available in most supermarkets under the Maple Leaf Farm label and cost about the same as buffalo.
Egg Whites
This superior source of high-quality, easily digestible protein has no fat or cholesterol. Problem is, egg whites lack vitamins minerals and other beneficial nutrients bodybuilders need, like essential fatty acids, so don't rely exclusively on egg whites to meet your protein requirement.
After buffalo, emu was our tasters' favorite. Fillets have a rich, dark taste (probably because they're loaded with iron) and a firm, but not tough, texture. What's more, emu has the least fat of any meat protein on our list, with the exception of turkey.
Speaking of turkey, we also tried spicy emu-turkey sausages made by Emu Enterprises Inc., an emu ranch in Northern California. Tasters loved them; one called the sausages great and another said they have a delicious, spicy flavor.
Emu is so lean, it's easy to overcook; the solution is to sear fillets quickly over high heat in a lightly oiled nonstick pan. Or you can marinate fillets and then cook about five minutes in a nonstick pan over medium heat. Cook emu sausages like any other sausage. Prices for emu are comparable to better-quality beef.
We put lamb on the list to demonstrate that some commonly eaten meat are surprisingly fatty and low in micronutrients. Save lamb only for special occasions.
Like emu, ostrich is packed with protein, low in fat and a good source of iron. It has a milder flavor than emu, so you'II want to add it to soups and stews or flavor it with a marinade instead of eating it straight up. Ostrich costs about $12.95 per pound for fillets and $4.50 a pound for ground meat.
All of our tasters liked pheasant for its flavorful, juicy meat. Unfortunately, this bird isn't a nutritional powerhouse a serving provides much less vitamins and minerals than most other meats. Still, it provides for variety from the monotony of chicken and turkey, and you can find pheasant in the freezer case of most supermarkets. Make sure to buy breasts only; the whole bird is significantly more fatty.
The "other white meat" has come a long way in the past decade. While ranchers were breeding leaner White Pekin ducks, some pork producers developed leaner hogs. The first pork certified by the American Heart Association, Smithfield Lean Generation Pork tastes good and is up to 98% fat-free. It also cooks about 20% faster than regular pork; many dishes can be ready in just 15-20 minutes.
This small bird got mixed reviews. Some liked the dark-meat taste, others didn't like it at all. A good source of iron and zinc compared to pheasant and chicken, each bird has a surprisingly generous amount of meat; two or three would make a meal for the average bodybuilder. You can find quail in the freezer case of most supermarkets.
This fish is one of the few foods containing a significant amount of linolenic acid, an essential fatty acid. We don't know how much linolenic acid humans require, but we do know that it has many functions of interest to bodybuilders: It maintains nerves that make muscles contract, keeps cells healthy and may reduce inflammation in hardworking joints. Eating just one serving of fish a week (but not taking fish-oil capsules) has been shown to reduce the risk of sudden-death heart attacks. You can reduce salmon's fat content by poaching it in boiling water (but then you'll lose some of the benefits of linolenic acid).
Although tofu is squishy and bland and a poor source of B6, iron and zinc, it's a versatile alternative to animal protein. What's more, soy foods like tofu (but not soy sauce) have a high concentration of a cancer-fighting compound called
genistein. So drop tofu into soups, stews, pasta sauces and smoothies for a low-fat, cholesterol-free protein boost. You can buy tofu in nearly every supermarket; choose low-fat and light varieties that have less fat than regular tofu.
Water-packed, canned tuna has plenty of protein, it's easy to carry and store, and it contains heart-healthy linolenic acid. Unfortunately, tuna's a poor source of vitamins and minerals so don't become overly reliant on tuna for protein.
Versatile and ultra low-fat, turkey offers a decent amount of iron and zinc compared to the other birds on our list. Unfortunately, it's almost flavorless. For more taste and a whole lot more vitamins and minerals, try eating buffalo or emu occasionally instead of turkey.
Our tasters weren't too excited about this meat; one called it too gamey and another said it had a heavy, unpleasant flavor. Another downside is its price: Lean cuts will set you back about $15 per pound. Still, venison is a good source of iron and zinc, so you may find it's worth getting used to.
Not one of our tasters liked the overwhelmingly gamey flavor of reindeer (also called caribou). Besides assaulting your taste buds, one reindeer steak will take all night to chew and could cost up to $21.95. Stick with buffalo and emu when you crave red meat.
Note: No nutrition information was available, though reindeer is probably comparable to venison.
If you're stuck in a training rut or just want to take your physique to the next level, make sure you consume enough protein and get it from various protein-rich foods. After all, variety is the spice of life and the foundation of a smart bodybuilder's diet.
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