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Merchants Hope for 1-Day Leap in Bottom Line

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TIMES STAFF WRITERS

Tenants today get an extra 24 hours to put off paying the rent. Greeting card companies are enjoying a once-every-leap-year marketing opportunity. And retailers hope to pad their revenues with an additional day of sales.

When Feb. 29 arrives on the calendar once every four years, it subtly makes itself felt both on Main Street and Wall Street. While this will be a day just about like any other for most firms, the leap day represents another spin for the wheels of commerce during the fiscal year.

At the U.S. Commerce Department, in fact, economist Jerry Donahoe estimates that the day will produce an extra $25 billion or so in business activity for 1996. To be sure, he notes, that sum is barely a blip in the nation’s $7-trillion-a-year economy.

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Restaurants, supermarkets and retailers are among the most likely to benefit today.

“Having 29 days in February means one more day of selling. It’s more money, more business and more time to serve your customers,” said Irma Wolfson, manager of the Lido Book Shoppe in Newport Beach.

Changing times seem to have done away with one aspect of the 29th--a day once set aside for women to take the initiative in romance.

But calls to jewelers, florists, chocolatiers, wedding chapels and restaurants around Orange County revealed that few people, if anybody, care about that anymore.

“I never heard of it,” said Ruthie Barba, owner of Ruthie’s Jewelry & Watches in Lake Forest. “And I haven’t sold any engagement rings or anything” to customers--female or male--who said they were planning to pop the question today.

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But companies such as Hallmark Cards, the leader in the greeting card industry, are pushing hard for a slice of the extra day of revenues. The Kansas City-based firm sells a special birthday card that says: “No wonder you look so young . . . you only have a birthday every four years.”

Company spokeswoman Rachel Bolton said, “When we let retailers know we’d have a leap year birthday card, we sold out immediately.”

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On paper, an extra day at the office can yield big dividends. For instance, General Electric netted $6.6 billion in profits in 1995--amounting to $18.1 million a day for each of last year’s 365 days.

Brokerage houses and banks also must pay attention to a leap year; after all, they have to pay an extra day’s interest on deposits and other customer cash balances they hold.

“We pay interest every day,” said Stephen Ward, chief investment officer of the giant brokerage Charles Schwab Corp. in San Francisco, which holds billions of dollars of clients’ cash through its money market funds and other investment accounts.

But no tears need be shed for Schwab. The firm simultaneously invests that cash and uses it to make loans to other customers--always making sure it earns somewhat more than the interest it’s paying.

And in leap year? Schwab simply demands a tad extra on its loans and investments to cover the extra interest it pays Feb. 29, Ward said.

Times staff writer James F. Peltz in Los Angeles contributed to this story.

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