Business today

TRADE GAP WIDENS: The improving economy helped drive up the U.S. trade deficit in February to its highest point in 10 months, as Americans' appetite for foreign-made cars, televisions and other goods increased. The trade gap widened to $31.5-billion, a 11.6 percent increase over January's deficit of $28.2-billion, the Commerce Department reported. Economists predict the trade gap will continue to widen this year as the United States recovers faster from its recession than other nations struggling with their own economic slumps. Stronger demand for imported goods is a sign the U.S. economy is rebounding from recession that began in March 2001.

TRW TURNS DOWN NORTHROP: TRW Inc. rejected defense contractor Northrop Grumman Corp.'s sweetened $6.7-billion takeover offer, saying it was inadequate. TRW, which makes defense and aerospace equipment and automotive parts including air bags and seat belts, said its proposal to spin off its automotive units would provide more value to shareholders. A Northrop Grumman spokesman said the company is confident that TRW shareholders will approve Northrop's offer over the proposed restructuring plan. TRW's stock rose $1.47 to $53.85.

MORE CUTS AT DELPHI: Delphi Corp., North America's biggest automotive parts manufacturer, said it plans to eliminate 6,100 jobs. The reductions come to about 3 percent of its work force. The former General Motors Corp. subsidiary announced last year that it would eliminate 11,000 jobs as part of a restructuring effort. Including the new cuts, the company expects to eliminate 17,540 jobs from 2001 through the first quarter of 2003.

SEC TO INVESTIGATE ADELPHIA: Shares of Adelphia Communications Corp. fell9.6 percent after the cable company said the Securities and Exchange Commission had opened a formal investigation into its accounting practices. Adelphia, which acquired americast's operations in Pinellas County last month, has come under scrutiny for failing to report that it had guaranteed $2.3-billion in debts incurred by the family of its founder, John Rigas. Tuesday, the company said it might restate its past financial statements to reflect that off-the-books debt. Adelphia shares closed at $7.25, down 77 cents.

Earnings

Digital Lightwave Inc.

Sales improved slightly in the quarter ended March 31 from the $5.4-million recorded in the fourth quarter, but the Clearwater company gave no guidance for when it might return to profitability.

Digital, which makes equipment to test and monitor high-speed fiber-optic cables, also said it has secured a three-year, $27.5-million line of credit with Wachovia Bank. It will consider acquisitions, among other uses for the funds.

Ford Motor Co.

The Dearborn, Mich., automotive giant absorbed a big charge for a change in accounting standards, as well as a 6 percent in revenue in the January-March quarter. The loss was smaller than Wall Street expected, however, as Ford said it expects to meet or surpass its earnings target for the year.

Boeing Co.

The aerospace company, now headquartered in Chicago, reported its first unprofitable quarter since 1997, which it blamed on a whopping $1.83-billion accounting charge and weaker-than-expected operating results.

IBM Corp.

Net income fell 31 percent in the quarter ended March 31, but that was in line with the reduced expectations the Armonk, N.Y., technology company laid out last week in a rare earnings warning. IBM originally was expected to earn 85 cents a share for the quarter.

Apple Computer Inc.

Thanks to brisk demand for its new iMac, the Cupertino, Calif., computer company beat Wall Street estimates by a penny a share for the fiscal quarter ended March 30.

AMR Corp.

American Airlines' parent company continued to struggle in the first quarter, and said it also expected to lose money in the second quarter. CEO Donald Carty said business travel, which historically constitutes a major portion of American's business, is not rebounding the way leisure travel has.

Allstate Corp.

The Northbrook, Ill., insurer posted a 15 percent decline in net income, citing an increase in claims by homeowners and losses on investments. The results still exceeded Wall Street expectations, excluding one-time adjustments.

Merrill Lynch & Co.

A prolonged investment banking slump hurt the nation's largest brokerage, which saw net income drop 26 percent in the quarter ended March 29. The New York company nonetheless beat analysts' earnings forecasts of 65 cents a share.

Philip Morris Cos. Inc.

The New York conglomerate cited improvements in each of its main businesses -- tobacco, beer and food -- for a 33 percent increase in income for the quarter ended March 31.

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