REGULATIONSEC Says 16 Companies Failed to Certify...
REGULATION
SEC Says 16 Companies Failed to Certify Results
The Securities and Exchange Commission said its staff has finished processing the 691 certifications of corporate financial results that were due by Aug. 14, finding just 16--or 2.3%--that weren’t able to sign off on their previous quarterly and annual numbers.
Companies that weren’t able to certify results were: ACT Manufacturing Inc., Adams Resources & Energy Inc., Adelphia Communications Corp., Alaska Air Group Inc., CMS Energy Corp., Consolidated Freightways Corp., Dynegy Inc., Enron Corp., Gemstar-TV Guide International Inc., Hercules Inc., LTV Corp., McLeod USA Inc., Mirant Corp., Qwest Communications International Inc., TruServ Corp., and WorldCom Inc.
Only one company, IT Group Inc., which is in bankruptcy liquidation, failed to file the certification by the Aug. 14 deadline or request an extension. An SEC spokesman declined to comment on what action the agency might take against the firm.
In June, the SEC ordered top executives at 947 of the nation’s largest companies to certify under oath that the results they file to the agency are accurate.
Dow Jones/Associated Press
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MEDICAL DEVICES
Medtronic Profit Up
on Strong Sales
Medtronic Inc., the world’s largest medical device maker, said quarterly profit rose sharply on strong sales of cardiac devices and accelerating sales of new products.
The maker of insulin pumps, pacemakers and implantable cardiac defibrillators said earnings rose 14% to $389.9 million, or 32 cents a share, for its fiscal first quarter, up 14% from a year ago, matching analysts’ expectations. The results exclude a $6.6-million charge for the consolidation of Medtronic’s vascular operations.
Minneapolis-based Medtronic’s revenue rose 16.5% to $1.71 billion.
Medtronic’s shares closed up 60 cents, or 1.44%, to $42.40 on the New York Stock Exchange.
Reuters
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AUTOMOBILES
BMW Recalls Sedans
for Air Bag Repair
BMW recalled 20,500 more of its 1999-model 323i and 328i sedans because side air bags may inflate unexpectedly and cause head injuries, the National Highway Traffic Safety Administration said.
The air bags might deploy if the car hits a large pothole or is struck with force that wouldn’t cause significant damage, according to the government agency.
“A small number of minor abrasions and bruises” have been reported as a result of unexpected deployments, a BMW spokesman said.
The German luxury auto maker in 1999 recalled 34,701 of the same models for the problem.
BMW plans to notify owners next month.
Bloomberg News
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ENERGY
UBS Warburg Fires 130 at Former Enron Unit
UBS Warburg said its energy-trading unit, acquired from Enron Corp. in February, cut about 130 jobs, or 21% of its staff, after a slump in natural-gas and electricity trading.
The job reductions were at the unit’s Houston headquarters and Portland, Ore., office.
Stamford, Conn.-based UBS Warburg acquired Enron’s energy-trading business through a bankruptcy auction. It hired 625 former Enron employees.
U.S. shares of UBS fell 69 cents to $47.65 on the NYSE.
Bloomberg News
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Duke Energy Reduces Profit After Probe
Duke Energy Corp. reduced energy-trading unit profit by 8% in the second quarter after a review of sham energy transactions requested by the Securities and Exchange Commission.
Earnings before interest and taxes were cut by $17 million at Duke Energy North America and by $2 million at other units after the second-biggest U.S. utility owner revealed 89 so-called round-trip trades, Duke said in a regulatory filing.
The filing didn’t explain why the round-trip trades lowered profit.
Shares of Charlotte, N.C.-based Duke rose 4 cents to $27.55 on the NYSE.
Bloomberg News
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TOBACCO
U.S. Smokeless Pulls
Request for Ad Claim
U.S. Smokeless Tobacco Co. has withdrawn a request asking the government to say whether it is OK to state in ads that its products are safer than cigarettes.
In a letter to the agency last week, the nation’s largest maker of moist snuff said it does not want the Federal Trade Commission to weigh in now because new information is likely to emerge from two tobacco conferences scheduled for September and October in Europe.
Some health advocates say the company was worried the agency would disallow the claims.
The U.S. surgeon general issued a report in 1986 saying smokeless tobacco products can cause cancer.
Congress subsequently passed a law stating that such products must be sold with health warnings.
U.S. Smokeless is a subsidiary of UST Inc. UST’s shares fell 59 cents to $33.37 on the NYSE. Its leading brands are Copenhagen and Skoal.
Associated Press
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TECHNOLOGY
U.S. Clears EBay’s
Purchase of PayPal
EBay Inc.’s $1.5-billion purchase of online payment service PayPal Inc. was cleared by antitrust regulators, eliminating a potential barrier to the transaction.
The Justice Department ended its review without asking for more information, said EBay, the largest Internet auctioneer.
On Nasdaq, shares of Mountain View, Calif.-based PayPal rose $2.10, or 10%, to $23.10 and EBay fell $1.45 to $60.41.
PayPal’s competitors include a smaller service operated by EBay.
PayPal, which lets users make payments electronically from banks and credit cards, estimated last year that 71% of EBay auctions listed PayPal as a payment option. That compared with 25% listing EBay’s rival service.
The acquisition, announced July 8, needs approval by PayPal stockholders and regulators, EBay said.
Bloomberg News
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RESTAURANTS
Diageo’s Burger King
Sale Clears Review
Britain’s Diageo said its plan to sell the world’s No. 2 hamburger chain, Burger King, for $2.26 billion in cash to a private equity consortium has cleared U.S. antitrust review.
Diageo is selling the underperforming fast-food chain to Texas Pacific Group, Bain Capital and Goldman Sachs Capital Partners.
Diageo wants to focus on expanding its drinks brands, which already include Smirnoff vodka, Johnnie Walker scotch and Guinness beer.
Reuters
