GAS, FOOD PUSH PRICE INDEX: Wholesale prices, stoked by higher costs for gasoline and food, registered their biggest rise in a year during April, providing fresh evidence that inflation is awakening after a long slumber. The Labor Department reported Thursday that the Producer Price Index, which measures the prices of goods before they reach stores, rose by 0.7 percent last month, following a 0.5 percent gain in March. April's increase was the largest since a 1.3 percent increase in March 2003 and topped the 0.3 percent advance that economists were forecasting. Excluding energy and food prices, the core rate of inflation rose by 0.2 percent for the second straight month.
UNEMPLOYMENT CLAIMS TICK UP: The number of Americans filing initial claims for unemployment insurance rose to 331,000 last week, holding close to the lowest since November 2000, a government report showed. The number of applications increased 13,000 from a revised 318,000, the Labor Department said in Washington. The four-week moving average of claims, a less volatile measure, fell to 335,750 from 343,500. U.S. companies have been less inclined to fire workers as the economy and corporate profits strengthen. Productivity grew at a 3.5 percent annual rate from January through March, trailing economic growth for a second straight quarter, recent data show.
KFORCE CLOSING ON ACQUISITION: Tampa staffing company Kforce Inc. has announced that it expects to close its acquisition of Novato, Calif., competitor Hall Kinion Inc. on June 7, three days after a scheduled vote on the deal by Hall Kinion shareholders. Though merger-related costs will dampen its second-quarter financial results, Kforce said, the acquisition will boost its earnings by the third quarter ending Sept. 30. Kforce forecast third-quarter revenues of $170-million to $180-million and earnings per share of 9 to 15 cents.
DIGITAL, JABIL REACH AGREEMENT: Digital Lightwave has agreed to pay Jabil Circuit $5.2-million through promissory notes in a settlement detailed in regulatory filings Thursday. Digital, a Clearwater maker of fiber-optic equipment, had outsourced its manufacturing to Jabil, but the St. Petersburg company sued in 2003 when Digital fell behind on payments. Under the settlement, Jabil has agreed to dismiss two lawsuits and will continue its service to Digital. Digital renewed two promissory notes to Jabil that mature Dec. 31, 2005; on Thursday, it paid $100,000 under one of the notes. Digital said it now has reached settlements with most of its large creditors. The cash-strapped company also said it borrowed an additional $1.4-million from Optel Capital, a company controlled by Digital's majority shareholder, Bryan Zwan.
GLOBAL PAID $104.4-MILLION: When Global Imaging Systems announced a deal to buy competitor Imagine Technology Group of Chicago last month, the Tampa distributor and servicer of office copiers declined to name the purchase price. But in a filing with federal securities regulators Thursday, Global said it paid Imagine's owners $104.4-million in cash plus 813,464 shares of company stock. The company used about $40-million of its own cash and borrowed the rest from its bank lenders.
TAMPA IN RUNNING FOR NABJ CONFERENCE: Tampa is one of nine cities in the running to host the National Association of Black Journalists annual convention in 2009 or 2010. The convention comes with about 5,000 room nights of hotel business and direct spending of about $2-million. The final decision is expected within about a month.
EISNER BASE PAY $1-MILLION: Michael Eisner will keep his $1-million annual salary as CEO of the Walt Disney Co., although he no longer serves as board chairman, according to the company's quarterly report filed Thursday. His compensation package still remains lower than those given to executives at Time Warner Inc. and Viacom Inc. Eisner had been chairman and CEO since 1984. After Disney's board stripped Eisner of his chairmanship in March, his employment contract was amended but his salary was not changed. Eisner received total compensation of $7.3-million in 2003, including a $6.25-million stock bonus.
RIGGS BANK FINED $25-MILLION: The Treasury Department's Office of the Comptroller of the Currency fined Riggs Bank a record $25-million Thursday for allegedly violating money laundering laws in its handling of tens of millions in cash transactions in Saudi-controlled accounts under investigation for possible links to terrorism financing. The civil fine against the midsize Washington bank with a near-exclusive franchise on business with the capital's diplomatic community is the largest ever imposed on a financial institution for such violations, experts said.
HOME DEPOT BUYS MEXICAN CHAIN: The Home Depot Inc. said Thursday it will buy Mexico's Home Mart and its 20 stores. Terms were not disclosed. The purchase will expand Atlanta-based Home Depot's presence in Mexico to 39 stores. Home Depot is the world's largest home improvement retailer; Home Mart is Mexico's second-largest home improvement retailer. "We anticipate a smooth transition and believe the combination of our two companies will benefit consumers in many ways," said Ricardo Saldivar, who will lead the combined operation as president of Home Depot Mexico.
CNBC'S BARTIROMO LEAVES FLOOR: CNBC's Maria Bartiromo is leaving the floor of the New York Stock Exchange. The newscaster is set to deliver her last staccato stock report from the exchange floor on Friday for the CNBC program Squawk Box. Bartiromo is ending a 10-year run as part of a new multimillion-dollar contract that will keep her at CNBC and parent NBC for the next five years.
HP TO BUY SERVICE COMPANIES: Hewlett-Packard Co. will buy ManageOne and CEC Europe Service Management Ltd. to expand its consulting and customer service businesses. Terms weren't disclosed. IT Infrastructure Management LLC, which operates as ManageOne in Dallas and CEC Europe in Britain, will join the HP Services division, Hewlett-Packard said in a statement. Hewlett-Packard is adding more services for managing computer networks to vie against Dell Inc. and International Business Machines Corp. Hewlett-Packard got 17 percent of its sales last year from services.
VIVENDI PAYS OFF FOR DILLER: Barry Diller, who controls Internet commerce company InterActiveCorp, sold his personal stake in Vivendi Universal Entertainment for $275-million after Vivendi Universal SA exercised a call right. Vivendi, which completed the sale of its U.S. media assets to General Electric Co.'s NBC on Wednesday, bought Diller's 1.5 percent stake, Vivendi COO Jean-Bernard Levy said. InterActiveCorp will keep its 5.4 percent in the entertainment unit, which is being folded into the new NBC Universal, he said. The company and Diller are unwinding ownerships that stem from 2002.
ANDERSEN OFFSPRING PLANS IPO: Huron Consulting Group Inc., formed in 2002 by former Arthur Andersen LLP partners to assist companies facing government investigations and shareholder suits, filed with the Securities and Exchange Commission to raise as much as $100-million in an initial public offering. Huron is seeking to capitalize on the increased scrutiny of public companies that followed the collapse of Enron Corp. Stricter U.S. laws have prompted more companies to hire firms such as Huron to review their books and determine whether restatements are required.
30-YEAR MORTGAGE RATE RISES: Rates on 30-year mortgages rose sharply this week. The mortgage company Freddie Mac reported Thursday that rates on 30-year fixed-rate mortgages climbed to 6.34 percent. It was the eighth consecutive weekly increase since rates hit a low for the year of 5.38 percent the week of March 18. A national survey of rates showed that the increase from 6.12 percent last week left 30-year mortgages at their highest level since they averaged 6.44 percent the week of Sept. 5.
YIELD JUMPS AT NOTE AUCTION: Yields on 10-year Treasury notes rose in Thursday's auction to the highest level in two years. The yield was 4.848 percent, up from 3.752 percent at the last auction March 11. It was the highest rate since 10-year notes sold for 5.170 percent May 8, 2002. A total of $15-billion in notes were sold.
Earnings:
Dell Inc.: The personal computer maker said Thursday its first-quarter profits rose 22 percent on record sales, but Dell reported rising inventory levels and higher costs for components. Earnings matched the forecast of analysts surveyed by Thomson First Call and Dell's own prediction from last month, when the company said overseas sales were stronger than expected.
Z-Tel Technologies Inc.: The Tampa phone company said its net loss in the quarter ended March 31 widened from a year earlier on nonrecurring charges that included reserves for possible tax, litigation and billing liabilities; development costs for its planned launch of Internet phone services; and expenses related to a trial marketing promotion with America Online. The company also said it has secured a $25-million credit facility with Textron Financial of Providence, R.I.
Dillard's Inc.: The department store chain based in Little Rock, Ark., beat analysts' forecasts by reporting that earnings doubled in the quarter ended May 1. The company credited its enhanced profitability to expense reduction and a 2 percent sales increase in stores open more than a year. Dillard's is increasing its selection of private-label merchandise and upscale brands to stand apart from moderately priced competition.
