Business digestCompiled from Times wires
© St. Petersburg Times
published March 8, 2002
WEEKLY JOBLESS CLAIMS SLIDE: The number of U.S. workers filing new claims for jobless benefits fell last week, the fourth decline out of five weeks. State unemployment offices received 376,0000 applications in the week that ended Saturday, down 5,000 from the previous week, the Labor Department said. The four-week moving average of claims, a less volatile indicator, fell to 372,750, the lowest since mid-August, from 374,000. So far this year, claims have averaged 380,000 a week, compared with 408,000 for all of 2001.
BANK CLOSING HITS CLEARWATER FIRM: Dozens of Clearwater employees of Key Financial Systems Inc. lost their jobs after federal regulators shut down Net First National Bank last Friday. Key Financial employees said as many as 300 workers were fired. Key Financial, a unit of Equitex Inc., did not return calls concerning the developments. The Clearwater employees sold and serviced the bank's "pay-as-you-go" credit card, which targeted consumers with bad credit. Equitex said it is trying to find another bank to assume the card portfolio and resume issuing cards. The Office of the Comptroller of the Currency said Net First failed to comply with a previous action requiring it to improve its credit practices, management and record keeping. The credit card program has been criticized for its high fees and modest benefits. Cardweb.com, which tracks the industry, called it "the worst credit card in America."
JABIL ACQUIRES PLANT: Jabil Circuit Inc. has acquired an Alcatel SA manufacturing plant in Brest, France, under an outsourcing agreement with the French phone-equipment manufacturer. Financial terms of the deal weren't disclosed. Jabil will continue to make Alcatel's private branch exchange and IP-based private communications exchange corporate telephone systems. About 700 workers will shift to Jabil.
TROPICAL SELLS CENTER: Tropical Sportswear Int'l Corp. agreed to sell the former Duck Head apparel distribution center in Winder, Ga., for $7.2-million to Chico's FAS Inc., a Fort Myers apparel chain. Tropical bought Duck Head a year ago and consolidated operations at its Tampa headquarters.
ADVERTISING MERGER: French advertising company Publicis SA is buying U.S. rival BCom3 for $3-billion in stock in a deal that would create the fourth-largest advertising group in the world. BCom3's main clients include Procter & Gamble, McDonald's and Philip Morris. Publicis and BCom3 are currently the sixth- and seventh-largest firms in the advertising world. The newly merged group will have annual revenue of $4-billion and employ some 38,000 people worldwide. Publicis also said it has signed a global strategic partnership agreement with Japanese advertising company Dentsu, allowing it to take advantage of Dentsu's experience in the important Japanese market.
AIRLINES TO SHARE DATA: American Airlines and United Airlines, the world's largest carriers, will streamline electronic ticketing to make it easier for customers to switch airlines when a flight is canceled. The change lets United and American customers use a single electronic ticket on trips that include flying on both carriers, the companies said. The airlines will have access to stored data in each carrier's computer reservations system. More than 65 percent of American's customers use electronic tickets, and more than 73 percent of passengers at United rely on the system for travel in the U.S.
SBC SLICES WORK FORCE: SBC Communications Inc., the nation's second-biggest local-telephone carrier, has cut more than 2,500 jobs so far this year and plans to reduce the number of customer-service centers by 40 percent. SBC had trimmed its work force by 5,000 in the fourth quarter. The company didn't say where the latest cuts came from. Separately, chief executive Edward Whitacre said the company also expects to meet its 2002 sales and earnings forecast. In January, SBC said per-share profit would rise 5 to 7 percent this year, excluding costs from one-time items and accounting changes. Sales will climb 1 to 3 percent.
DOT-COM IPO: Fast-growing online DVD rental service Netflix Inc. plans to raise $115-million with an initial public offering of its stock, providing another flicker of optimism in the depressed dot-com industry. The company's filing with the Securities and Exchange Commission didn't specify how many shares will be sold or provide a per-share price target. Wall Street has spurned most dot-com companies after being burned by the IPOs of Internet companies that went bankrupt over the past two years. Another 18 Internet companies collapsed in February, bringing the total number of dot-com failures to 806 since January 2000, according to Webmergers.com.
GENDER BIAS DISPUTE SETTLED: Rent-A-Center Inc. will pay $47-million to more than 5,300 women and make sweeping changes to its employment practices in settling two sex-discrimination lawsuits. The rent-to-own company admits no liability but will fill 10 percent of job vacancies in the first 15 months after the deal with women fired because of their gender since 1998, or who were rejected as job applicants because they were women. Rent-A-Center also must create a human resources department, and seek women for what now is the company's all-male board of directors.
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