Las Vegas Sands, the casino and hotel operator, has swung to a loss as America's gamblers give the entertainment capital of the world a wide berth, and new ventures in Macau disappoint. Source: Infocious RSS raw feed - channel BNPaperBusiness | 1 May 2008 | 2:02 pm
Las Vegas Sands, the casino and hotel operator, has swung to a loss as America's gamblers give the entertainment capital of the world a wide berth, and new ventures in Macau disappoint. Source: Telegraph Business | 1 May 2008 | 2:02 pm
AP - The Home Depot is closing 15 of its namesake stores, affecting 1,300 employees. It is the first time the home improvement retailer has ever closed a flagship store for performance reasons. Source: Yahoo! News: Business | 1 May 2008 | 1:48 pm
Nationalised lender Northern Rock begins consultations with unions and staff over plans to cut 2,000 jobs. Source: BBC News | Business | World Edition | 1 May 2008 | 1:48 pm
SAN FRANCISCO (MarketWatch) - Some analysts questioned whether Prudential Financial Inc. will be able to meet its target for full-year earnings on Thursday after the life insurance and annuity giant reported disappointing first-quarter results.
NEW YORK (Reuters) - Global news and information company Thomson Reuters Corp posted an operating profit for the first quarter on Thursday, and forecast 2008 revenue growth of 6 percent to 8 percent, pushing its shares up 5 percent.
NEW YORK (MarketWatch) -- U.S stocks on open mixed as data showed inflation and jobless claims rising more than forecast, and Exxon Mobil Corp.’s per-share profits fell under expectations.
NEW YORK (MarketWatch) -- Treasury bonds gained Thursday, sending yields lower, boosted by a jump in jobless claims and a mixed opening on Wall Street.
Wrapping up the first three months in world history with oil at $100 a barrel and rising fast, Exxon Mobil (TICKER:US:XOM) says first-quarter profit gushed 17% higher, but the petroleum giant fell short of its all-time record set last year.
Among the stocks expected to trade actively in Thursday’s session are CVS Caremark, Eastman Kodak, ExxonMobil, Fiserv, Herbalife, International Flavors, Iron Mountain, NDS Group, NetManage, Oshkosh, Revlon, Starbucks, Sunoco and Symantec.
It is the age of broadband, but no one could tell that from the results of companies which supply equipment to the broadband suppliers like cable and telecom firms JDSU (JDSU), one of the oldest companies in the industry, reported poor earnings. Net revenue for the third quarter of fiscal 2008 was $383.9 million and the net loss was $6.2 million, or $(0.03) per share. This compares to net revenue of $361.7 million and a net loss of $14.2 million or $(0.07) per share for the third quarter of fiscal 2007. What was worse was guidance. JDSU said that for...
Reuters - The Dow and the S&P 500 opened little
changed on Thursday as a disappointing profit from Exxon Mobil
Corp and data pointing to employment weakness offset optimism
about a pullback in oil and other commodity prices as the
dollar rebounded.
NEW YORK (Reuters) - The Dow and the S&P 500 opened little changed on Thursday as a disappointing profit from Exxon Mobil Corp and data pointing to employment weakness offset optimism about a pullback in oil and other commodity prices as the dollar rebounded.
NEW YORK (MarketWatch) -- Apache Corp.'s first-quarter net income breaks through $1 billion as the crude oil and natural gas producer lifted production by 4% amid rising fuel prices.
Weekly first-time filings for state unemployment benefits surge by 35,000, essentially erasing the drop reported in the prior week and keeping investors guessing about the state of the U.S. economy.
US consumer spending rose more than expected in March but the bulk of the increase reflected higher costs for food and energy as real disposable income declined, new figures showed Source: FT.com - US homepage | 1 May 2008 | 1:33 pm
While many utilities are reporting earnings, there is one thing that many investors will care about more than each company's results. It seems that utilities across the board are filing with state or regional boards for rate relief to pass on higher costs to customers. First Energy Corp. (NYSE:FE) today reported first quarter earnings of $276 million, or $0.91 EPS, compared with earnings of $290 million and $0.92 EPS for the same period in 2007. First quarter revenues totaled $3.3 billion, better than analyst estimates of $3.14 billion and $0.85 EPS. First Energy noted that high fuel costs and higher...
ATLANTA (Reuters) - Retailer Home Depot Inc , which has been battered by the slumping U.S. housing market, on Thursday said it plans to close 15 underperforming stores and said it will curb future store openings.
Reuters - Retailer Home Depot Inc , which
has been battered by the slumping U.S. housing market, on
Thursday said it plans to close 15 underperforming stores and
said it will curb future store openings. Source: Yahoo! News: Business | 1 May 2008 | 1:29 pm
In a move that has probably never happened in its history, Home Depot (HD) will close 15 stores. It will also cancel the opening of another 50 locations. According to the company, "These closings will impact approximately 1,300 associates. The store managers and assistant store managers at these locations will be offered other store management positions within the organization. The Company will work to place the rest of the associates in other comparable store positions where available." The moves should cut capital spending by about $1 billion over the next three years. The company will write-off $400 million due to...
HOUSTON (Reuters) - Marathon Oil Corp said on Thursday first-quarter earnings edged up 2 percent as profits from record oil prices outweighed weak margins at its refining business.
AFP - The Bank of England said Thursday that British commercial banks had overestimated their exposure to the collapsed US subprime home loan sector and the subsequent global squeeze on credit.
As president of Google, Larry Page has pushed his people to take risks that have led to hot new applications like Gmail and Google Maps. Lately he has been thinking far outside the walls of his company. Page sees a world of opportunity - in areas ranging from energy to safer cars. But he also sees a world of timidity; not enough people, he worries, are willing to place the big bets that could make a difference in meeting humanity's biggest challenges.
Reuters - The number of workers applying for
jobless benefits surged last week in gloomy news for the labor
market, but personal spending in March was stronger than
expected, government data on Thursday showed. Source: Yahoo! News: Business | 1 May 2008 | 1:14 pm
Reuters - The number of workers applying for
jobless benefits surged last week in gloomy news for the labor
market, but personal spending in March was stronger than
expected, government data on Thursday showed. Source: Yahoo! News: Business | 1 May 2008 | 1:14 pm
WASHINGTON (Reuters) - The number of workers applying for jobless benefits surged last week in gloomy news for the labor market, but personal spending in March was stronger than expected, government data on Thursday showed.
US consumer spending climbs by 0.4% in March, beating analyst expectations, official figures show. Source: BBC News | Business | World Edition | 1 May 2008 | 1:10 pm
iRobot Corp. (NASDAQ: IRBT) shares are seeing their share of sellers today. The company posted a loss of -$0.16 EPS on $57.3 million in revenues, while First Call estimates were -$0.16 and $55 million. Unfortunately, despite the stock well off of highs this story doesn't get much better. The company's guidance for fiscal-2008 is now $0.12 to $0.17 EPS on revenues of $295 to $305 million, while estimates are $0.23 EPS and $298 million. The company also lost its CFO Geoffrey Clear, who is resigning to pursue opportunities with emerging companies with $50 to $300 million in revenues. To add...
US stocks were set for a flat start after estimate-beating results from Tyco balanced against an earnings miss from ExxonMobil and jobless claims that rose more than forecast Source: FT.com - US homepage | 1 May 2008 | 1:06 pm
Wall Street stocks were set for a flat start on Thursday after estimate-beating results from Tyco balanced against an earnings miss from Exxon Mobil and jobless claims that rose more than forecast.On Wednesday... Source: Infocious RSS raw feed - channel BNPaperBusiness | 1 May 2008 | 1:06 pm
Northern Rock, the recently nationalised mortgage lender, today confirmed
plans to lay-off nearly a third of its staff, with the majority of job cuts
expected this year. Source: Latest Business News from Times Online | 1 May 2008 | 1:02 pm
NEW YORK (Reuters) - Exxon Mobil Corp on Thursday posted disappointing first-quarter earnings, as record crude oil prices did not help the company as much as investors hoped.
As Wall Street comes to the end of what is often called the 'best six months' of the year, investors may be feeling cheated. And concerned. If that was the market at its best, what does the market at its worst look like?
Energy firm Shell wants to sell its stake in a project to build the world's largest wind farm in the Thames Estuary. Source: BBC News | Business | World Edition | 1 May 2008 | 12:49 pm
Record oil prices netted Exxon Mobil $10.89 billion in the first quarter, sharply higher than a year earlier but short of Wall Street expectations and below what was needed to set a new all-time profit record.
Apple (AAPL) plans to release major movie titles on iTunes as the same time they come out on DVD. That is while the DVD business is still around. According to The Hollywood Reporter "The new arrangement with the studios is expected to involve Fox, Walt Disney Studios, Warner Bros., Paramount, Universal, Sony Pictures, Lionsgate and New Line." The studios are taking a great risk. They now make a large amount of their revenue, and larger amount of their profits, from DVD sales. If the contracts with Apple are not as lucrative on a per title basis, earnings at the movie-makers...
Reuters - Exxon Mobil Corp on Thursday
posted disappointing first-quarter earnings, as record crude
oil prices did not help the company as much as investors hoped.
NEW YORK (Reuters) - Comcast Corp , the largest U.S. cable operator, on Thursday posted a fall in first-quarter net profit and a drop in basic video subscribers as it faced fierce competition from phone and satellite companies.
Smith & Nephew, the FTSE 100 medical-equipment group, today warned that
“unacceptable” sales practices in a business it bought last year will cost
it more than $100 million ($£50 million) in lost sales this year. Source: Latest Business News from Times Online | 1 May 2008 | 12:32 pm
Jane Lighting is set to step down as chief executive of Five tomorrow, with
the announcement that Mark White, Five's executive director of sales, will
serve as interim chief executive until Dawn Airey arrives. Source: Latest Business News from Times Online | 1 May 2008 | 12:24 pm
These are not all of the analyst calls affecting shares but these are ten that we are focused on this Thursday morning: Annaly Mortgage (NYSE: NLY) cut to Hold at Citigroup. CommScope (NYSE: CTV) Raised to Buy from Neutral at UBS. Endo Pharmaceuticals Cut to Neutral at R.W. Baird. First Solar (NASDAQ: FSLR) cut to Perform at Oppenheimer Hovnanian (NYSE: HOV) cut to Sell at UBS. Jones Apparel (NYSE: JNY) Raised to Buy from Hold at Lazard. O2Micro (NASDAQ: OIIM) raised to Buy at Piper Jaffray. PharmaNet Development (NASDAQ: PDGI) downgraded to Hold at Jefferies; downgraded to Neutral at R.W....
NEW YORK (Reuters) - Photography company Eastman Kodak Co on Thursday posted a bigger-than-expected quarterly loss as higher silver and aluminum costs and increased spending on its inkjet... Source: Infocious RSS raw feed - channel BNewsBusiness | 1 May 2008 | 12:19 pm
Wall St. didn't think much of Exxon's (XOM) earnings. That is odd because the company made an obscene $10.9 billion. The stock is off over 2%. The oil company's earnings for the first three months of the year rose to $10.9 billion, or $2.03 per share, up from $9.3 billion, or $1.62 per share is the quarter a year ago. Revenue rose to $116.8 billion from $87.2 billion. All of that seemed to miss analyst expectations as the company ran aground. Douglas A. McIntyre
Smith & Nephew issued a profits warning on Thursday after finding "unacceptable sales practices" in parts of Plus Orthopaedics, a Swiss group it acquired last year for $889m. David Illingworth, chief... Source: Infocious RSS raw feed - channel BNPaperBusiness | 1 May 2008 | 12:17 pm
NEW YORK (Reuters) - Wyndham Worldwide Corp , the
world's No. 2 hotel group by rooms, said on Thursday
first-quarter profit fell as growth in its economy hotel
business was offset by a one-time charge related to the
rebranding of its timeshare operations.
NEW YORK (Reuters) - Wyndham Worldwide Corp , the world's No. 2 hotel group by rooms, said on Thursday first-quarter profit fell as growth in its economy hotel business was offset by Source: Infocious RSS raw feed - channel BNewsBusiness | 1 May 2008 | 12:16 pm
NEW YORK (Reuters) - Exxon Mobil Corp on Thursday said its first-quarter earnings rose 17 percent on crude oil prices that surged to record levels during the quarter. Source: Infocious RSS raw feed - channel BNewsBusiness | 1 May 2008 | 12:12 pm
Comcast Corp. on Thursday reported a 12.5 percent decline in first- quarter profits from a year ago, when the company's earnings were inflated by a $300 million one-time gain. The... Source: Infocious RSS raw feed - channel BNewsBusiness | 1 May 2008 | 12:12 pm
Two of Britain's biggest names in toy-making have combined after Hornby, the model railiway maker, bought Corgi Classics, for 7.5m Source: Infocious RSS raw feed - channel BNPaperBusiness | 1 May 2008 | 12:12 pm
Two of Britain's biggest names in toy-making have combined after Hornby, the model railiway maker, bought Corgi Classics, for £7.5m Source: Telegraph Business | 1 May 2008 | 12:12 pm
Exxon Mobil Corp., the world's largest publicly traded oil company, says record crude prices helped its net income grow 17 percent in the first quarter. ExoonMobil said Thursday its... Source: Infocious RSS raw feed - channel BNewsBusiness | 1 May 2008 | 12:11 pm
Burger King Holdings Inc. said Thursday that strong same-store sales in each of its segments and new restaurant growth helped to boost profit 21 percent in its third fiscal quarter. ... Source: Infocious RSS raw feed - channel BNewsBusiness | 1 May 2008 | 12:09 pm
NEW YORK (Reuters) - Revlon Inc reported a much smaller quarterly net loss on Thursday, due in part to expenses being lower than they were a year ago when the cosmetics maker launched a... Source: Infocious RSS raw feed - channel BNewsBusiness | 1 May 2008 | 12:01 pm
The mystery of the legal clash between eBay and the online classifieds service Craigslist has been solved.
At the heart of the dispute, as Megan Barnett speculated last week, was that eBay liked Craigslist so much that it launched a direct competitor, Kijiji, in some U.S. markets in 2007.
In a redacted lawsuit that was released late on Wednesday, eBay does not deny that Kijiji would compete, but contends that Craigslist went too far in its response under the terms of a 2004 agreement that gave eBay a 28.4 percent stake in the company. Kijiji has reportedly grown to 10 percent the size of Craigslist in just six months.
"The original agreement between the two parties always envisioned that there could be competitive activity," an eBay spokeswoman, Kim Rubey, told the Associated Press.
Months after Kijiji's start in the United States (it began in overseas markets in 2005), Craigslist's owners, Craig Newmark and Jim Buckmaster, "engaged in clandestine transactions" to dilute eBay's stake to 24.85 percent, and prevent it from nominating a new member to Craigslist's board, the suit says.
"We are no longer comfortable having eBay as a shareholder, and wish to explore options for our repurchase, or for otherwise finding a new home for these shares," Buckmaster, Craigslist's chief executive, told Meg Whitman, the C.E.O. of eBay, in an email last July.
Whitman's response, according to the suit, was an offer to buy the entire company.
"We would welcome the opportunity to acquire the remainder of [Craigslist] we do not already own whenever you [and Newmark] feel it would be appropriate," she wrote.
Speculation about a sale or initial public offering of Craigslist has periodically swelled in the wake of rich valuations given to YouTube after Google's $1.5 billion acquisition and to Facebook after Micosoft's investment in it.
Craigslist's top executives have consistently mocked such ambitions, expressing a complete lack of interest in cashing out.
The lawsuit cites an appearance by Newmark on The Charlie Rose Show just days before Whitman's overture. Nemark said that people are always asking Buckmaster how they are going to make more money.
"And we say, 'hey, not interested.' Because once you are living well, and maybe providing for your future, what's the point in more," Newmark said.
Henry Blodget on the Silicon Alley Insider website last month estimated that Craigslist has $80 million in annual revenue and $25 million in operating profit. But Craigslist is run like a nonprofit, he notes.
To get a look at Craigslist's true value, one would have to make certain assumptions about its earnings power, which leads Blodget to conclude that it is a business with the potential to $750 million in revenue and $500 million of operating profit, giving it a valuation of $5 billion.
CVS Caremark Corp., the nation's biggest pharmacy chain, said its first-quarter profit jumped 84 percent, helped by surging sales in the wake of last year's purchase of Caremark. ... Source: Infocious RSS raw feed - channel BNewsBusiness | 1 May 2008 | 11:59 am
Wall Street headed toward a higher open Thursday amid growing optimism that the credit crisis that pummeled global markets might be nearing an end. Investors, one day after the Federal Source: Infocious RSS raw feed - channel BNewsBusiness | 1 May 2008 | 11:58 am
Reducing health care costs - and insuring the 47 million Americans who have no coverage - is the Rubik's Cube of policy puzzles. And it's one that the Democratic and Republican presidential candidates say they can solve.
Reuters - Comcast Corp , the largest
U.S. cable operator, on Thursday posted a fall in first-quarter
net profit and a drop in basic video subscribers as it faced
fierce competition from phone and satellite companies.
The Congolese government has given an oil permit claimed by Tullow Oil to a rival consortium. Source: BBC News | Business | World Edition | 1 May 2008 | 11:47 am
NEW YORK (Reuters) - Noble Energy Inc , an independent energy company, said on Thursday its first-quarter profit rose, boosted by an increase in oil and gas sales. Source: Infocious RSS raw feed - channel BNewsBusiness | 1 May 2008 | 11:43 am
Demand for new homes plunged by 27 per cent during the first quarter of 2008,
leading an 8 per cent decline in overall orders for new construction. Source: Latest Business News from Times Online | 1 May 2008 | 11:32 am
Comcast (CMCSA) had a very good quarter, and did especially well taking phone customers from its Bell rivals. Revenue was up 14% to 8.389 billion. Operating income moved up 23% to $1.555 billion. One the VoIP side of things, Comcast picked up 639,000 phone customer, raising its penetration of homes served to 5.1 million households. Phone revenue increased 65% to $587 million in the first quarter of 2008 from $356 million in 2007. The addition of 2.6 million subscribers in the last twelve months drove revenue from VoIP by more than doubled to $573 million in the first quarter of...
Nepal bans the export of rice and other grains to try to control food costs and prevent shortages. Source: BBC News | Business | World Edition | 1 May 2008 | 11:07 am
British Airways was the top performing stock on the FTSE 100 on Thursday as investors reacted to a confirmation that the airline was in talks with two US rivals about a potential tie-up.BA was 3.8 per... Source: Infocious RSS raw feed - channel BNPaperBusiness | 1 May 2008 | 10:56 am
Detroit is now viewed as a metaphor for the car industry in the US, even if GM (GM) and Ford (F) are the only public companies based there. For purposes of domestic car sales, it might as well be the home of VW and Hyundai. And, word has come that the head of Nissan told Reuters that the market in the US will not recover until 2009/2010. Toyota, Nissan, Honda (HMC) and their European rivals can do better in America than the home team, but not too much better. The pie still has to grow for all to do well....
Microsoft, the world's largest software maker, is said to be willing to raise
its offer for Yahoo!, the struggling internet portal, in an attempt to
appease Yahoo! shareholders and break the stalemate between the companies. Source: Latest Business News from Times Online | 1 May 2008 | 10:49 am
Discussions between British Airways and transatlantic competitors American Airlines and Continental Airlines could be the first step towards a merger, according to well-placed sources. Source: Telegraph Business | 1 May 2008 | 10:45 am
Markers in Europe were modestly higher at 6.30 AM New York time. The FTSE rose .1% to 6,092. BHP Billiton (BHP) was up 2.8% to 1851. Vodafone (VOD) was off 1.5 to 157.9. The DAXX was up .9% to 6,949. Lufthansa was down 6% to 16.87. Siemens (SI) was up 3% to 75.57. The CAC rose .4% to 4,997. Alcatel-Lucent (ALU) was off 3.6% to 4.33. EADS was up 4.4% to 16.15. Data from Reuters Douglas A. McIntyre
The dollar climbed to its highest level in a month against the euro and hit a two-month high against the yen on Thursday after the Federal Reserve signalled it may hold US rates at 2 per cent.Following... Source: Infocious RSS raw feed - channel BNPaperBusiness | 1 May 2008 | 10:36 am
Casino company Las Vegas Sands loses $11.2m (£5.6m) in the first quarter as gamblers stay away. Source: BBC News | Business | World Edition | 1 May 2008 | 10:25 am
Britain's big banks stand to lose as much as a fifth of their profits as the commercial property market implodes, the Bank of England has warned. Source: Telegraph Business | 1 May 2008 | 10:20 am
A measure of output of UK factories fell this month to the lowest level in three months, according to a survey from the Chartered Institute of Purchasing and Supply. At the same time, a gauge of the prices... Source: Infocious RSS raw feed - channel BNPaperBusiness | 1 May 2008 | 10:15 am
A measure of output of UK factories fell this month to the lowest level in three months, according to a survey from the Chartered Institute of Purchasing and Supply. At the same time, a gauge of the prices producers are having to pay jumped to 61.9, the most the CIPS began compiling records in 1999. Paul Dales of Capital Economics comments on what the numbers mean. Source: Telegraph Business | 1 May 2008 | 10:15 am
The Bank of England says many lenders' worries are overstated and may delay a credit crunch recovery. Source: BBC News | Business | World Edition | 1 May 2008 | 10:02 am
Sir Stuart Rose has sold his controversial 100,000 investment in the karaoke bars operator founded by Martha Lane Fox, his boardroom colleague at Marks and Spencer, the retail group's chief executve revealed... Source: Infocious RSS raw feed - channel BNPaperBusiness | 1 May 2008 | 9:54 am
Sir Stuart Rose has sold his controversial 100,000 investment in the karaoke bars operator founded by Martha Lane Fox, his boardroom colleague at Marks and Spencer, the retail group's chief executve revealed... Source: Infocious RSS raw feed - channel BNPaperBusiness | 1 May 2008 | 9:54 am
Allco Finance said its senior debt had fallen below the A$1bn mark as the troubled Australian asset manager locked in tense negotiations with bankers warned that full-year losses could top A$1.5bn.The... Source: Infocious RSS raw feed - channel BNPaperBusiness | 1 May 2008 | 9:53 am
Toymaker Hornby agrees to buy die-cast model car maker Corgi in a £7.5m deal to expand its product line. Source: BBC News | Business | World Edition | 1 May 2008 | 9:41 am
Sir Stuart Rose, chief executive of Marks and Spencer, is to sell his £100,000
stake in Martha Lane Fox’s karaoke business in a bid to defuse the row over
boardroom standards at Britain’s largest clothing retailer. Source: Latest Business News from Times Online | 1 May 2008 | 9:37 am
British Airways confirms it is discussing "co-operating" with two of its largest US rivals, American Airlines and Continental Airlines. Source: BBC News | Business | World Edition | 1 May 2008 | 9:37 am
Hammerson, the commercial property company, said that rents in the City of London office market were falling because banks were shedding jobs in the wake of the credit crunch and needed less space. Source: Telegraph Business | 1 May 2008 | 8:50 am
Microsoft has yet to decide if it will increase its $44.6bn (£22.4bn) for Yahoo, go hostile or walk away from the deal. Source: BBC News | Business | World Edition | 1 May 2008 | 8:44 am
Discussions between British Airways and transatlantic competitors American Airlines and Continental Airlines could be the first step towards a merger, according to well-placed sources. Source: Telegraph Business | 1 May 2008 | 8:00 am
The sanguine tone of the Bank of England's twice-yearly Financial Stability
Report has dampened expectations that the Monetary Policy Committee may cut
interest rates again as soon as next week. Source: Latest Business News from Times Online | 1 May 2008 | 7:18 am
A miscalculation on inventories keeps the trend barely positive. Central bank signals it may stay on sidelines.
The U.S. economy dodged outright contraction during the first three months of the year, growing at a 0.6% annual pace for a second quarter in a row, the government said Wednesday.
The Dow tops 13,000 before finishing lower as investors wonder what the Fed's next step will be.
Wall Street gave up sharp gains and closed lower Wednesday after the Federal Reserve cut an interest rate by a quarter of a point but left investors guessing about the central bank's next move.
Homeowners who owe more than their property is worth are offered new terms.
Jared Lanning, struggling to pay a home loan on which he owed more than his house was worth, was thinking he might just let the lender take back the property. Then he got a call one evening from an Orange County investor who had bought his mortgage.
The $750-million upgrade will include four 14-story office buildings.
New owners of NBC Studios in Burbank unveiled plans Wednesday for $750 million worth of upgrades to the historic lot where top entertainers and newscasters have broadcast to the nation since the 1950s.
Microsoft Corp.'s board of directors spent much of Wednesday debating whether to escalate the company's high-stakes battle to win Yahoo Inc. or walk away, according to people familiar with the talks.
The first-quarter decline was made worse by one-time charges, including losses at lender GMAC. It's a big reversal from the automaker's $62-million profit in the same period last year.
You know things are bad when a $3.3-billion loss is cause for Wall Street celebration.
The media giant, its share price languishing, reports a 36% decline in first-quarter profit.
Answering Wall Street's calls for a slimmer and more focused company, Time Warner Inc.'s chief executive said Wednesday that the cable system operator in which it holds a majority stake would become a completely separate entity.
McCain Foods is closing the vegetable processing line at its Timaru plant with the loss of 30 jobs.
The Engineering, Printing and Manufacturing Union (EPMU) said many of the workers will be able to get jobs at a french-fry line... Source: New Zealand Herald - Business | 1 May 2008 | 5:16 am
Eric Falkenstein isn't your typical 42-year-old hedge fund manager. Instead of trading stocks all day or courting new investors, he spends his time updating his blog, researching equity strategies, and talking to his lawyer. He's a hedge fund portfolio manager who is legally restrained from managing hedge fund portfolios.
But Falkenstein didn't embezzle funds, swindle unsuspecting investors, or violate insider-trading laws. Rather, he quit his job one September day in 2006 and he hasn't been able to work since.
Several months after he resigned, Falkenstein's former employer, Telluride Asset Management in Minneapolis, sued him for stealing the firm's trade secrets and violating its confidentiality agreement. Falkenstein had created trading algorithms for Telluride during his two and a half years on the job there, and the firm believed he was planning to use the same techniques to trade stocks for a fund he wanted to establish. The latest hearing in the ongoing legal battle will take place in Minnesota today.
Welcome to the murky world of hedge fund trade secrets, where your likelihood of getting a new job may be directly related to your employer's inclination toward litigation. These types of trade-secret suits are generating a controversy in the hedge fund industry. Is the litigation little more than a bullying tactic to keep valuable employees from heading to a competitor, as the blogger Equity Private suggests? Is the specific knowledge of trading strategies one gains at a hedge fund legitimately unusable in any future endeavor? Or are traders stealing secrets with the hopes of making more money from them someplace else?
These suits may not be as bizarre as the case that was dropped yesterday by the Equal Employment Opportunity Commission of the SAC Capital trader who claimed he was forced to take female hormones to improve his trading. But they're considerably more common in the industry, and they wield much greater impact.
"Large law firms have started advising their securities clients that they have trade-secret claims against their employees," says one attorney who represents two defendants in a similar case. "They want the benefit of a noncompete without paying for it." This attorney increasingly hears from hedge fund employees who want to switch funds but are nervous about being sued.
They certainly have good reason to be careful. In 2004, Renaissance Technologies, the hedge fund run by the billionaire trader Jim Simons, sued two former employees and Millennium Partners, the fund they subsequently joined. Millennium settled the suit last year for a reported $20 million. The two employees, who were terminated from Millennium, continue to fight Renaissance's allegations.
Last year, Piper Jaffray sued four former employees and the hedge fund they started after leaving the bank. The firm alleges the workers re-created technical research products from the ones they developed at Piper.
And in fact, Telluride itself had already sued and settled with another former employee in 2004 for stealing trade secrets that the employee said were strategies he created before arriving at the firm. That same year, Telluride found itself on the receiving end of a trade-secret suit brought by the former employer of a new hire.
Falkenstein is fighting the suit because he believes it has no merit, and that any trading techniques he planned to use were from the public domain or taken from his prior experience.
But more importantly, Falkenstein has to fight it if he wants to keep doing the only thing he's ever done professionally. "Telluride would like me to work in marketing or something," he says. "I want to be a portfolio manager again. It's what I know. It's what I do."
The cases can be lengthy and quite costly to fight. Falkenstein calls it a "tactic" used by hedge funds—a single lawsuit is enough to make other employees too afraid to leave. "They only have to make an example out of one in 10 to make the tactic work," he says.
But Tara Norgard, an attorney with Carlson Caspers Vandenburgh & Lindquist who represents Telluride, says hedge funds are in business to make money, not spend it on lawyers for unnecessary lawsuits. They only sue if they have reason.
Moreover, hedge fund managers leave firms nearly every week to start their own funds without lawsuits following them. "It's a two-way street," she says. "Most know how to drive it. Some don't."
Trade-secret suits are difficult to follow in the public domain by their very nature: They're based on secrets. Add to that the complexity of hedge fund trading algorithms, and you have all the necessary ingredients for an endless legal battle.
The specific trade secrets at the heart of Falkenstein's case remain sealed. He claims that Telluride hasn't precisely defined the trade secrets they believe he stole. Norgard insists they have.
Falkenstein says he would love to settle the case and continue to work as a portfolio manager, but, so far, that option hasn't presented itself. The case is set to go to trial in January of 2009 after the discovery process has been completed.
Right now, Telluride is examining 10 years' worth of data from hard drives on Falkenstein's personal computers for evidence of stolen trade secrets. "There's nothing like a bunch of lawyers trying to figure out mean-variance optimization," he says.
Until the suit is resolved, of course, there's always more blogging to be done.
There are signs that the software group is eyeing a proxy fight to try to gain control of Yahoo's board after the ultimatum it had issued to the internet company expired Source: FT.com - US homepage | 1 May 2008 | 2:52 am
SEATTLE (Reuters) - Microsoft Corp's board met on Wednesday to discuss its stand-off with Yahoo Inc over its $41.8 billion takeover bid, but failed to reach a decision on what to do next, according to a Wall Street Journal report.
The European arm of $17bn (£8.6bn) fund American Capital is set to cut back on private equity buy-out investments because the economic and investment climate is so poor. Source: Telegraph Business | 1 May 2008 | 1:00 am
Quite incredible! In all my time working in the city I cannot recall when the FTSE has ever finished four trading sessions in a row at, effectively, the same level. Source: Telegraph Business | 1 May 2008 | 12:01 am
The US economy grew by 0.6 per cent in the first three months of this year, avoiding outright contraction owing to a build-up in business inventories and continued support from exports Source: FT.com - US homepage | 30 Apr 2008 | 11:55 pm
The property downturn could see an exodus of agents from the industry, Real Estate Institute of New Zealand (REINZ) president Murray Cleland says.
House sales have hit a wall in recent months as higher interest rates put the brakes... Source: New Zealand Herald - Business | 30 Apr 2008 | 11:47 pm
A key congressional committee approved legislation that could complicate US efforts to reach a denuclearisation deal with North Korea Source: FT.com - US homepage | 30 Apr 2008 | 11:24 pm
The Federal Reserve cut interest rates by a quarter-point to 2% and signalled its preference to pause at its next meeting in June, dropping its explicit focus on 'downside risks' to growth Source: FT.com - US homepage | 30 Apr 2008 | 11:11 pm
The Federal Reserve cut US interest rates by a quarter-point last night, to
only 2 per cent, the lowest since December 2004, as it pursued its drive to
limit America’s economic downturn. Source: Latest Business News from Times Online | 30 Apr 2008 | 11:00 pm
Perhaps the Fed is not quite done, after all. In the past week financial
markets have clustered around a pretty firm consensus that the Fed would
signal that it was getting ready to halt its long, aggressive campaign of
interest rate cuts. Source: Latest Business News from Times Online | 30 Apr 2008 | 11:00 pm
The correction in the credit markets has gone too far, the UK central bank says, in a signal that it believes the worst of the global crisis could be over Source: FT.com - US homepage | 30 Apr 2008 | 10:58 pm
Kroll's former European chairman is leading a move to buy the world's biggest corporate security group from Marsh & McLennan, its owners Source: FT.com - US homepage | 30 Apr 2008 | 10:39 pm
Dorchester Pacific shares fell to a record low today after the finance company issued its second profit warning in three months, and said its chief executive was moving on.
The company also said it expected a $5 million after tax... Source: New Zealand Herald - Business | 30 Apr 2008 | 10:32 pm
Starbucks tempered disappointing earnings news on Wednesday with a raft of product launch announcements, the latest in a series of measures to breathe life into the struggling brand.
Speaking on a conference call after the close of trading, C.E.O. Howard Schultz laid out three (not yet named) chilled beverage initiatives focused around the health and wellness category.
The first will be Starbucks' debut in energy beverages, a market that Schultz estimates at $4.4 billion and growing at 31 percent annually. Starting this summer the coffee chain will launch an extension of Doubeleshot, a canned espresso-based drink available at Starbucks stores and at other retailers.
"Entering this category offers us a significant opportunity for us to compliment our customers lifestyle and engage in important and relatively untapped demo for Starbucks," Schultz said on the call.
Energy drinks will be customizable in Starbucks stores and available elsewhere through a joint venture with Pepsi, which currently markets Doubleshot and Frappuccino beverages in association with Starbucks.
The other two new beverages—a low-calorie protein and fruit smoothie and a frozen concoction similar to a Frappuccino—were revealed in the Wall Street Journal earlier Wednesday.
Starbucks said the smoothie will be initially available in two flavors this summer. The Frappuccino-like product, which will be made in partnership with an Italian supplier, will have "options ranging from fruit based, to dairy based, to yogurt based ingredients." That new beverage will be introduced in Southern California.
Schultz also spoke vaguely about plans for "nutritious" food items in stores, the first of which will arrive in September. The company said earlier in the year that it would stop selling warm breakfast sandwiches.
"We are highly committed to the health and wellness category and see this as an important long term growth area for the company," said Schulz.
Wednesday's product launch announcements came amid news of a disappointing 28 percent drop in quarterly profit for the company, and plans to further cut U.S. store openings.
Starbucks had second-quarter net income of $108.7 million, or 15 cents per share, compared with $150.8 million, or 19 cents per share, a year earlier.
In advance of last week's profit warning by the company, analysts had been looking for a second-quarter profit of 21 cents per share.
Revenue rose 12 percent to $2.53 billion. But U.S. same-store sales fell on a percentage basis due to a weakening consumer environment.
Whether Exxon Mobil breaks its $11.6 billion record for quarterly earnings on Thursday, its massive profits will most probably lead both Democratic presidential candidates to repeat their calls for a new tax on the "windfall" profits the industry has earned on the back of oil selling for more than $100 a barrel.
Nothing, of course, makes a conservative economist fly off the handle like soaking wealthy oil producers. But even liberals would have a hard time defending the country's last experience with a windfall tax, in 1980.
What began as a compromise by the Carter administration to lift ceilings on oil prices grew into a bureaucratic nightmare that Congress in 1984 called the "largest and most complex tax ever levied on a U.S. industry." The law produced nowhere near the revenue it promised, made the country more reliant on foreign oil, and generated reams of red tape, according to a 2006 report by the nonpartisan Congressional Research Service.
The law was put out of its misery in 1988, two-and-a-half years before it would have automatically expired.
"It's a terrible idea today," said Phil Verleger, who helped design the windfall tax policy as the Treasury Department's director of domestic energy policy from 1977 to 1979. "The windfall profit tax was a quo for a quid; the quid was price decontrol. There's no quid right now."
Neither Democratic candidate has provided enough detail to make a full analysis of their current windfall-tax proposals.
Senator Barack Obama's campaign says he "supports imposing a windfall-profits penalty on oil selling at or over $80 per barrel" and spending the proceeds to help Americans deal with high energy prices.
Senator Hillary Clinton says she'll tax "windfall profits"—no figures are provided on how the termis defined—to pay for a temporary suspension of the 18.4-cent-per-gallon federal tax on gasoline.
Proposals like these have appeared regularly, always when oil prices have spiked.
"Everyone gets frustrated and is looking for a simple answer and a scapegoat, and the oil companies are really easy to vilify," says Gilbert Metcalf, a Tufts University economics professor and a research associate at the National Bureau of Economic Research.
President Jimmy Carter proposed the 1980 windfall tax to placate Congress as he lifted Nixon-era price controls on oil. Allowing the price of oil to rise from about $14 to the then-market price of $24 was certain to generate a windfall for oil companies, which Carter proposed should be shared with the American public.
A 50 to 70 percent tax was imposed on the market price of oil and a 1979 base price adjusted for inflation. (Technically, it was a sales tax, not a duty on excess profits.)
Today's market-driven oil-price spike makes a windfall tax a harder pill to swallow for supporters of the original policy. Emil Sunley, who was the deputy assistant Treasury secretary for tax policy in the Carter administration, noted that $110 or $115 a barrel is an "uncontrolled price" set by the laws of supply and demand, unlike the price of crude in 1980.
"There's a greater burden of proof to say this is just a pure windfall that we should tax," Sunley said.
At the time, Carter-era officials forecast that their windfall tax would generate $393 billion in gross revenue between 1980 and 1988, but it actually generated $80 billion, Salvatore Lazzari, a specialist in public finance at the Congressional Research Service, concluded in a 2006 report.
Because oil producers could deduct their windfall-tax payments from their income tax, the government netted only about $38 billion. Worse, the tax sent the U.S. oil industry into a decline. Domestic production fell somewhere between 1.2 percent to 8.0 percent during the period. Refiners shifted to foreign supplies, and imports surged.
Of course, a windfall tax could also be imposed on imported oil. But economists say that would increase energy prices much more than would a tax on domestic sales alone.
The law created an almost comical administrative burden at the Internal Revenue Service, which was suddenly faced with administering a levy on about one million businesses and people who could be classified as oil producers.
Congress created loopholes and categories that made the law a nightmare to administer. Exemptions and breaks were issued for Alaskan oil, for oil from new fields, and for oil unexpectedly coaxed from old fields.
Independent producers were taxed less than big companies, and crude from federal and Native American lands was exempt. To add to the burden, the windfall levy was amended almost every time a new tax law was enacted between 1980 and 1988.
The I.R.S. spent 11,577 staff days in the 1981 fiscal year on examining windfall taxes and another 6,335 days on training and related projects, according to a 1984 congressional study.
I.R.S. experts were forced to rule on the minutiae of the oil industry, such as choosing from among the three ways the industry was calculating the market price of Sadlerochit oil in Alaska. Case files were adding 33,000 pages of paper every two weeks, prompting a $1.8 million computer-modernization program that might be called one of the law's few lasting benefits.
The 146-page congressional report found just how woeful the situation was at the I.R.S. Tax personnel reported that oil producers frequently tried to thwart the tax authority, refusing to cooperate or creating a "multiplicity of purchases and sales and exchanges" that rendered the task of tracing the tax burden labyrinthine.
Even the appeals process was riddled with problems, since the law allowed each owner of an oil asset an individual court hearing—and it was not unusual for 50 or more people to own a single asset.
So byzantine were the windfall tax's terms that even the Supreme Court didn't want to get involved. Today's proponents might consider the court's unanimous decision to decline a challenge to the law in 1983, when the justices thrust their palms in Congress' face:
"Love in the Meadows," the French version of a TV show now airing in America, is in its third season. About 100,000 single French farmers live often lonely, rural lives, but many wish the show would be put out to pasture. John Laurenson reports. Source: Marketplace | 30 Apr 2008 | 9:10 pm
With newspapers across the nation cutting staff, and local and national broadcast outlets laying people off, commentator David Frum asks whether the future of the news business might be found in a more partisan press. Source: Marketplace | 30 Apr 2008 | 9:10 pm
Like other banks hit by the credit crunch, Citigroup is selling off stock to raise money -- diluting the stock's value. Michael Holland of the Holland & Company investment firm, talks with Kai Ryssdal about the impact such moves have on investors. Source: Marketplace | 30 Apr 2008 | 9:10 pm
Spring has been coming earlier and earlier in the Rocky Mountains for the past decade. And while this year has been a bumper crop for snow, scientists and farmers are worried about a dry, long-term trend. Peter O'Dowd reports. Source: Marketplace | 30 Apr 2008 | 9:09 pm
After a little financial help from Congress, the Food and Drug Administration announced it will hire 1,300 new employees. It's a big deal for an agency that currently employs about 10,000 workers. Jeremy Hobson reports. Source: Marketplace | 30 Apr 2008 | 9:09 pm
Corporations are subject to some of the same economic stresses as the rest of us -- especially companies that sell food. Kraft and Kellogg reported lower profits today. But they did better than anybody was expecting. Alisa Roth reports. Source: Marketplace | 30 Apr 2008 | 9:09 pm
The Federal Reserve did exactly what everyone thought it was going to do today -- cut short-term interest rates 0.25%. In the process it said some not-so-reassuring things. John Dimsdale reports. Source: Marketplace | 30 Apr 2008 | 9:08 pm
Contact Energy shares soared to an all-time high yesterday on market speculation of a buy-out after an unsolicited offer for its majority shareholder Origin Energy.
It emerged yesterday that BG Group, Britain's third-largest natural... Source: New Zealand Herald - Business | 30 Apr 2008 | 9:00 pm
Westpac's net profit in New Zealand rose 12 per cent to $244 million in the six months to March 31 despite having to make higher provisions.
Impaired loan charges rose to $61m from $42m. Losses were driven by higher provisions... Source: New Zealand Herald - Business | 30 Apr 2008 | 8:30 pm
A federal judge has knocked out a key argument advanced by the recording industry in its battle against illegal file sharing—that consumers can be held liable for simply making copyrighted content available online, even if no one downloads it.
In his decision Tuesday, District Court Judge Neil Wake in Phoenix rejected the industry's "making available" argument, dealing a major blow to the industry's legal strategy as it pursues illegal file swappers.
Wake made his ruling while denying the Recording Industry Association of America's motion for summary judgment, forcing the group to try to make its case at trial.
"[The Copyright Act of 1976] is not violated unless the defendant has actually distributed an unauthorized copy of the work to a member of the public," Wake wrote in his decision. "Merely making an unauthorized copy of a copyrighted work available to the public does not violate a copyright holder's exclusive right of distribution."
The R.I.A.A. sued Pamela and Jeffrey Howell of Scottsdale, Arizona, for copyright infringement in 2006 after the industry's private investigator, MediaSentry, remotely detected 54 copyrighted songs in a publicly available folder on the Howells' computer.
The R.I.A.A. asserts that because the Howells, who are representing themselves in the case, used the file-sharing program Kazaa to make copyrighted works available, they're guilty of infringement, despite the fact that no one—except MediaSentry—ever downloaded the content at issue.
Jeffrey Howell has acknowledged that he had used Kazaa, but said the songs discovered by MediaSentry were copies made for "private use" from his compact-disc library. Kazaa software had automatically placed them in the Kazaa shared folder.
Fred Von Lohmann, a staff attorney at the Electronic Frontier Foundation, a nonprofit digital advocacy group that filed a brief in support of the Howells, called the ruling "a big victory."
"In its order, the court delivers the most decisive rejection yet of the recording industry's 'making available' theory of infringement (i.e., if someone could have downloaded it from you, you've violated copyright, even if no one ever did)," Von Lohmann wrote in a blog post.
A spokesperson for the R.I.A.A., meanwhile, criticized the ruling.
OceanaGold Corporation produced nearly 63,000 ounces of gold from its South Island mines in the first quarter of 2008.
Altogether the company sold more than 67,700 ounces of gold in the three months to the end of March, a 75 per... Source: New Zealand Herald - Business | 30 Apr 2008 | 8:20 pm
Starbucks Corp said on Wednesday it would slash US coffee store openings through 2011 as it adjusts to slower US growth and turns its focus to expanding newer international markets.
The company, which warned last week of the worst... Source: New Zealand Herald - Business | 30 Apr 2008 | 8:15 pm
The west is struggling in the ideological battle against radical Islam and has failed to provide an effective response to extremist propaganda, the US said Source: FT.com - US homepage | 30 Apr 2008 | 8:11 pm
The emissions trading scheme will take a toll on economic growth, incomes and jobs, but the cost will be less if the taxpayer keeps picking up the bill for the trade-exposed sectors' emissions, the New Zealand Institute of Economic... Source: New Zealand Herald - Business | 30 Apr 2008 | 8:00 pm
Contact Energy held yesterday's gain in early trading on the sharemarket today while the other two heavyweights, Telecom and Fletcher Building, lifted the market into the positive.
Wall Street ended lower despite the Federal Reserve... Source: New Zealand Herald - Business | 30 Apr 2008 | 7:30 pm
Waged for the most part by corporate outsiders—Roman Catholic nuns, state and union pension funds, or maverick lawyers—campaigns about executive pay or labor conditions abroad are often met with indifference from the public and derision or condescension from corporate executives.
The Rockefellers are rich, of course, and the rich are different. So their shareholder campaign attracted a lot of attention when they launched it today in the bright penthouse of Le Parker Meridien hotel in New York.
There, before a bevy of reporters and cameras and a table laden with fruits, coffee, pastries, and croissants, two descendants of John D. Rockefeller laid out in patrician accents their case for changes at Exxon Mobil in its current incarnation.
A majority of Rockefeller family members support four resolutions on global climate change and corporate governance that will go before Exxon Mobil shareholders at their annual meeting in Dallas next month.
It is not just the Rockefeller name that is attracting interest but the back-to-the-future aspect of the campaign. Exxon Mobil is a descendant of John D. Rockefeller's Standard Oil, the first modern multinational, founded in 1870.
"We almost define the term long-term investor," said Neva Rockefeller Goodwin, a great-granddaughter of the company's founder and daughter of David Rockefeller, the former chairman of Chase Manhattan Bank.
The name of John D. is being invoked to press Exxon Mobil to devote more resources to finding energy alternatives to oil and natural gas, for the long-term benefit of the company and shareholders, as well as for the environment.
Goodwin, who is co-director of the Global Development and Environment Institute at Tufts University, noted that John D. Rockefeller's genius was in recognizing kerosene as the "alternative energy" of the 19th century, replacing whale oil.
Exxon, she said, needs to "get back to its strong historical roots." (Although presumably that does not include fixing prices with railroads or shooting at striking workers.)
"Exxon Mobil is profiting in the short term from investments and decisions made many years ago and by focusing on a narrow path that ignores the rapidly shifting energy landscape around the world, including developing nations," she said.
Three of the four shareholder resolutions backed by the Rockefellers concern global climate change. The fourth seeks to have the chairman's role be independent from that of the chief executive. Rex Tillerson became C.E.O. and chairman of Exxon Mobil in January 2006. (Exxon Mobil recommends that shareholders reject all four proposals.)
Rockefeller family members had quietly brought up these issues with company executives in years past, said Goodwin's cousin Peter O'Neill, a great-great-grandson of John D. "It was not an easy decision for the majority of the Rockefeller family to go public with our concerns," he said.
Goodwin hailed Exxon Mobil's "strong corporate culture," noting that its top executives have spent their entire careers at the company. But, she added, that culture "includes not listening to outside voices."
Goodwin recalled an informal lunch that she had with Lee Raymond, then chairman and chief executive of Exxon Mobil, and Tillerson who was about to succeed him. "I was told I had to behave myself and not say much," she said.
There are 152 descendants of John D., who died in 1937. Seventy-eight of them are over the age of 21, and 66 are supporting the four shareholder resolutions, O'Neill said.
The Rockefeller cousins, he said, do both business and philanthropy together and "spend a lot of time" communicating with one another about common interests.
The Rockefellers could not say how much of Exxon Mobil is owned by family members. It has been estimated that the combined family stake is not very large, but Goodwin said that it "is a significant holding for us."
When the U.S. Supreme Court ordered the breakup of Standard Oil as an "unreasonable monopoly" in 1911, it was split into 34 companies. One, Standard Oil of New Jersey, became Exxon; another, Standard Oil of New York, became Mobil. The Rockefeller family had shares in all 34 companies as a result. Exxon and Mobil merged in an $80 billion deal in 1998.
The news conference came a day before Exxon Mobil is expected to report a blowout first quarter on higher oil prices. Indeed, the Rockefellers were careful to emphasize that they were pleased with Tillerson and the recent performance of the company and the stock price.
"When Exxon Mobil does well, so do I and other members of my family," Goodwin says. But she and O'Neill said that family members are concerned that the company is not doing enough to prepare for the long term, as some of its rivals have.
The resolution to separate the positions of chairman and C.E.O. is similar to one put forward last year, which received 40 percent of the vote. The Rockefellers said they expected the resolution would do better this year and expressed hope that the board would make changes if the nonbinding resolution received more than 50 percent of the vote.
The Connecticut state pension fund and the two big California public pension funds, Calpers and Calstrs, support the four resolutions. Denise Nappier, the treasurer of the State of Connecticut, said Exxon Mobil is the state pension fund's largest single holding, at $300 million.
As the world's biggest publicly traded company—and biggest nonstate energy producer—Exxon Mobil has long been a lightning rod for critics of many stripes. At its annual meeting, shareholders will be asked to vote on 19 resolutions, most of them concerning the environment and corporate government.
Another reason why Exxon Mobil has been a target was Raymond, its longtime leader and an irascible bull of a C.E.O. who cared little about the niceties of corporate P.R.
That comes across in one of the arguments for the resolution on an independent chairman, brought by Robert Monks, the longtime shareholder activist, in Exxon's own proxy.
It cites part of an exchange between Raymond and the then-state treasurer of Maine, Dale McCormick, at the 2004 annual shareholders meeting.
McCormick: Then may I pose that question to Mr. Houghton, who is the chair of the audit committee?'
Raymond: You may not, you may not.
McCormick: Why, sir?
Raymond: Because that's not—the audit committee looks at the recommendations of management. That's properly the responsibility of the controller of the corporation.
McCormick: May I pose it to you?
Raymond: Oh, sure. You can pose anything to me. (Laughter)
McCormick: Will you answer me then?
Raymond: Oh, that's a different question. (More laughter)
McCormick: Sir, I do not think it is a matter of laughter when an institutional investor representing over 3 million shares cannot get answers to an important question like this.
Raymond: The question is precisely what?
McCormick: What provisions have you made on the financial statements for the damage caused by climate change and the potential liability [resulting therefrom]?
Raymond: It's neither likely nor could it be estimated.
Listed software company Xero has changed its legal name after the one it had always wanted became available.
The company secured xero.com as its internet address when it was set up but with Xero Limited unavailable at the New Zealand... Source: New Zealand Herald - Business | 30 Apr 2008 | 7:25 pm
Ben Bernanke is evidently not in the mood for surprises. As expected, the Federal Open Market Committee cut its target for short-term interest rates by a quarter of a point, to 2 percent.
It's the Fed's seventh rate cut since September, and it may be its last for the time being. The statement, issued in conjunction with the rate cut, suggests that the Fed may pause its tightening as it keeps an eye on signs of rising inflation.
"The substantial easing of monetary policy to date, combined with ongoing measures to foster market liquidity, should help to promote moderate growth over time and to mitigate risks to economic activity," the Fed statement said.
Fed watchers believe that the reference to cumulative actions is a signal that the Fed may stop cutting rates for now.
Despite the series of rate cuts, the economy has continued to slow and inflationary pressures remain high. The Fed indicated that the tight credit market and the housing slump will likely continue to quell economic growth "over the next few quarters."
The Fed also expects energy and commodity prices, which have risen at a rapid pace during recent months, will level out in "coming quarters," and that inflation will moderate.
It left the door open for further measures, however. "The committee will continue to monitor economic and financial developments and will act as needed to promote sustainable economic growth and price stability," it wrote.
Eight members of the committee approved the rate cut. Charles Plosser and Richard Fisher voted to keep rates unchanged.
The market had a cool reaction to the news. The Dow Jones industrial average, which had been up more than 100 points for most of the day, lost all of its gains by the end of the trading session.
During the earnings conference call, Bewkes and John Martin, the company's chief financial officer, sought to cast AOL's performance in a positive light despite a 38 percent decrease in subscription revenues and a substantial decrease in operating income this quarter from the same period last year.
Martin explained the 25 percent decline in operating income, saying that the first quarter of 2007 had been the highest quarter of the year, making a comparison "tough." And he said that this quarter's weak ad increase—1 percent—would improve substantially by the second quarter.
The good news included 52 billion page views—up 6 percent from the first quarter a year ago—and record highs for traffic and viewer engagement in March.
Still, the unit remains a thorn in the company's side.
"For the last two conference calls, Bewkes has talked about dividing the company into three buckets: content, AOL, and cable," says Chris Marangi, senior vice president at Gamco Investors, the asset management and financial services company led by Mario Gabelli.
Cable growth has been strong, and pretax operating earnings for content—Time Warner's publishing, film, and television-network properties—grew 10 percent in the first quarter. So Marangi says it's natural for investors to turn their focus to AOL, the weak link.
Bewkes has made much of his intention to separate AOL's internet-access business, once the dominant player in its field, from its burgeoning online- advertising business, Platform A. This morning, he said that such a change would "increase the accountability and enhance the strategic flexibility" of both pieces of the business.
"By splitting the two, it's clear that the core focus is on the ad-platform business," says Fred Singer, a former senior vice president at AOL and the current C.E.O. of Anystream, a company that produces and distributes streaming media. Singer believes that to remain viable in the face of a Microsoft-Yahoo merger, which would take away two potential acquirers for AOL, Time Warner's best bet is to restructure AOL around the new ad platform.
As for the access business, a cash-flow generator, AOL could keep it around for cash or sell it off to a company like Earthlink. Marangi speculates that it could even make a good buyout target, should that market return. "Some bottom fisher could come along and buy it, put on a lot of debt, and run it as a cash cow," he says.
Such a scenario is far away—for now, Time Warner doesn't break out the profitability of AOL's access and advertising businesses separately, although Bewkes has promised to provide more financial color in the future. That did nothing to ease analysts' concerns; their questions on the conference call focused almost entirely on AOL.
Does the business have sales-channel issues? Had it missed opportunities on pricing?
A particularly pointed question about Bebo, the social-networking site that AOL acquired in March, touched on the site's unknown revenue and profitability and wondered about the chain of command for the acquisition approval. After a very long pause, competing voices spoke at once.
Finally Bewkes cut through. "If you're asking did I approve acquiring Bebo, yes!" But he declined to break out profitability numbers, saying that the acquisition hadn't closed yet.
AFP - Leading shares in London closed flat on Wednesday, having reversed earlier gains ahead of the Federal Reserve's interest rate decision and after better-than-expected US economic data, balanced by weakness among the UK miners.
Just how bad are things in the automotive industry? So bad that investors cheer when General Motors racks up $3.3 billion in losses in just three months.
The automaker's first-quarter losses were driven by costs related to a labor strike and charges in its GMAC financing unit. Continued weakness in the North American market also impacted G.M.'s quarter. The slowing economy is especially hurting sales of sport-utility vehicles and pickups.
Also on Portfolio.com: No Recession Here The U.S. slowdown will give global advertising giants a chance to show their chops, especially on the Web. Mortgage Walk Aways: The Un-Crisis Abandoned homes are a questionable symbol of the housing crisis.
Excluding certain charges, G.M. said it lost $350 million, or 62 cents per share, which was much better than the $1.67-per-share loss that analysts predicted. Revenue declined slightly from the prior year.
The carmaker's shares jumped nearly five percent in premarket trading.
Car sales in Asia, Latin America, and Eastern Europe were strong during the quarter, but not strong enough to offset the sluggish North American market, which was G.M.'s only regional unit to post a loss.
"We continue to leverage our global product portfolio to take advantage of tremendous growth in key emerging markets, while at the same time taking the appropriate actions to deal with the challenging economic conditions in the U.S.," said G.M. chief executive Rick Wagoner in a statement.
G.M. chief finance officer Ray Young told reporters this morning that analysts are underestimating the strength of its overseas operations, according to Bloomberg.
He also said he expects the second quarter to be slightly better for G.M., but he does not expect as much of a recovery as predicted earlier. "The second quarter is probably going to be a tough quarter for the industry,'' he said.
G.M.'s first-quarter results stand in sharp contrast to Ford's unexpected profit for the same period. It was helped by aggressive cost-cutting domestically and strong overseas sales.
Reuters - The Dow and the S&P 500 opened little
changed on Thursday as a disappointing profit from Exxon Mobil
Corp and data pointing to employment weakness offset optimism
about a pullback in oil and other commodity prices as the
dollar rebounded.
AFP - The Bank of England said Thursday that British commercial banks had overestimated their exposure to the collapsed US subprime home loan sector and the subsequent global squeeze on credit.
Reuters - Exxon Mobil Corp on Thursday
posted disappointing first-quarter earnings, as record crude
oil prices did not help the company as much as investors hoped.
Reuters - Comcast Corp , the largest
U.S. cable operator, on Thursday posted a fall in first-quarter
net profit and a drop in basic video subscribers as it faced
fierce competition from phone and satellite companies.
AFP - Leading shares in London closed flat on Wednesday, having reversed earlier gains ahead of the Federal Reserve's interest rate decision and after better-than-expected US economic data, balanced by weakness among the UK miners.