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Business today

By Wire services
Published September 18, 2003

HOUSING STARTS SLOW: Housing construction slowed last month but remained close to a 17-year high, a sign that a recent upward swing in mortgage rates has done little damage to the housing market. Builders broke ground on 1.82-million housing units at a seasonally adjusted annual rate in August, a 3.8 percent drop from July, the Commerce Department reported Wednesday. Housing construction boomed in July, at a rate of 1.89-million units, the strongest level since April 1986.

JABIL, REPTRON RECOGNIZED: Four of the world's 100 biggest electronic manufacturing contractors have a significant presence in the Tampa Bay area, Electronic Business reported in its September issue. Jabil Circuit Inc. of St. Petersburg and Reptron Electronics Inc. of Tampa ranked fifth and 33rd, respectively, based on 2002 revenues. Sparton Corp. of Jackson, Mich., ranked 35th, has a 120,000-square-foot facility in Brooksville. Sypris Solutions Inc. of Louisville, Ky., operates a 318,000-square-foot facility in Tampa.

HACKER ATTACK FORMING: Security researchers have detected hackers distributing software to break into computers using flaws announced last week in versions of Microsoft Corp.'s Windows operating system. The threat is remarkably similar to one that allowed the Blaster virus to infect hundreds of thousands of computers in August. The discovery gives fresh impetus for tens of millions of Windows users - inside corporations and in their homes - to immediately apply a free repair patch from Microsoft.

WAFFLE HOUSE SUED: More than 50 black customers are suing the Waffle House restaurant chain, claiming they were discriminated against because of their race, lawyers said Wednesday. The plaintiffs say they were denied service, forced to wait for long periods and subjected to racial slurs by employees. Floridians were involved in two of the lawsuits. A Georgia resident traveling through Florida filed suit against a Waffle House in Tallahassee. An Orlando resident traveling in North Carolina filed a lawsuit against one of the chain's stores there. Suits also were filed in Georgia, South Carolina and Texas. Officials of Waffle House in Norcross, Ga., denied the charges.

GOODBYE, "AOL': AOL Time Warner Inc.'s board will vote on a proposal to drop "AOL" from the company's name today, the Associated Press reported, citing a source familiar with the matter who spoke on condition of anonymity. The measure was expected to pass. Company spokeswoman Mia Carbonnell declined to comment.

SULLIVAN ENTERS PLEA: WorldCom Inc.'s former chief financial officer Scott D. Sullivan, who has pleaded not guilty to federal securities fraud charges, entered the same plea Wednesday to state securities-fraud charges in Oklahoma County Court. Oklahoma Attorney General Drew Edmondson filed criminal charges last month against WorldCom, Sullivan and other former company executives, saying action taken so far by federal law enforcement authorities had been inadequate.

AMERICABLE TO PAY $22-MILLION: Americable International Inc., a family-owned cable television company based in Miami, must pay at least one-third of its value in penalties for trying to defraud a Pentagon program intended to dampen the losses companies suffered when military bases closed in the 1990s, a federal judge ordered Wednesday. Americable agreed to pay $22-million in fines, restitution and forfeiture as part of a plea bargain on two conspiracy counts. The company prepared $8-million in fake invoices to cover its lost investment in cable operations at bases facing closure, primarily in California and the Northeast. No payments were made.

VALRICO BRANCH "NEXT GENERATION': Bank of America is opening the first of its "next-generation" branches in Florida today at Lithia Crossing in Valrico. The Charlotte megabank's new banking centers include safe deposit boxes accessed through an electronic palm scanner, terminals for self-service Web banking, multilingual telephone banking, and advanced technology ATMs. By 2005, Bank of America plans to open 18 such banking centers throughout the Tampa Bay area.

AMTRAK STRIKE CONSIDERED: Unions representing Amtrak workers said Wednesday they will shut down the railroad for one day Oct. 3 to draw attention to what they consider chronic underfunding by the government. Labor leaders say they hope that if employees bring Amtrak to a standstill, the public will recognize the railroad's importance and pressure Congress to spend more on it.

SUN TO CUT 1,080 JOBS: Sun Microsystems Inc., which has had nine straight quarters of falling sales, will eliminate as many as 1,080 jobs, or about 3 percent of its workforce, to concentrate on products and services that are doing well. The maker of server computers will cut jobs in all regions, spokeswoman May Goh Petry said. The cuts will be "extremely targeted" and are still being decided, she said. Chief executive Scott McNealy, who has already cut 7,300 jobs in the past two years, is seeking to help Sun adjust to reduced spending by customers and lower-cost products from competitors.

SUGAR CHAIRMAN AT NORTHROP: Northrop Grumman Corp. said Wednesday that Ronald D. Sugar, the defense contractor's president and chief executive, has been named board chairman. Sugar, 55, will take over Oct. 1 from Kent Kresa, who retires on that date after serving as chairman since 1990. Kresa stepped down as president and CEO in April. Sugar came to Northrop in 2001 when it bought Litton Industries, where Sugar was president.

GE CEO PAID FOR PERFORMANCE: General Electric Co. chief executive Jeffrey Immelt will receive "performance share units" instead of stock options, tying the equity portion of his compensation more directly to the company's results. "The board believes that the CEO of GE needs no retention compensation, and that his or her equity compensation should be focused entirely on performance and alignment with investors," a GE statement said. The changes do not affect Immelt's base salary of about $3-million, said David Frail, a company spokesman.

FEWER WORKPLACE DEATHS: Working got safer last year, according to the government's annual tally of workplace deaths, released Wednesday. Nationally, 5,524 workers died on the job in 2002 - a significant decrease from the 5,915 who died in 2001, a number that did not include those killed in the Sept. 11 terrorist attacks. That decline extended a downward trend since 1997, when 6,238 workers died. Workplace homicides also declined, down to 609 last year from a 1994 peak of 1,080.

TENET SELECTS FETTER: Tenet Healthcare Corp., the hospital company under investigation by at least three U.S. government agencies, named Trevor Fetter as chief executive officer. Fetter, 43, has been acting CEO. He was also elected to the company's board of directors, Tenet said in a statement. He succeeds Jeffrey Barbakow, who quit in May as the company's stock failed to recover from a selloff last year.

EARNINGS

Best Buy Co. Inc.: The nation's biggest consumer electronics chain said Wednesday its profit more than doubled in the second quarter, helped by back-to-school sales of notebook computers and cost cutting. The results, the best second quarter in company history, matched the consensus estimate of analysts surveyed by Thomson First Call and were in line with the company's revised earnings estimate released Sept.4.

Circuit City Stores Inc.: The nation's second-largest electronics retailer said its loss for the latest quarter included pretax charges of $148-million to reduce the carrying value of the company's retained interest in its bankcard portfolio and $18.2-million related to remodeling three stores and modifications at 208 stores. The net loss per share from continuing operations would have been 14 cents per share. Analysts surveyed by Thomson First Call expected Circuit City to lose 13 cents per share for the quarter.

FedEx Corp.: The package delivery company said Wednesday its profit dropped 19 percent in its first fiscal quarter, citing the costs of a previously announced program for early retirement and voluntary severance. Excluding one-time items, earnings for the first quarter were 61 cents a share. That beat the consensus forecast of analysts surveyed by Thomson First Call of 57 cents per share.

[Last modified September 18, 2003, 02:03:00]

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