FACTORY ORDERS RISE IN JUNE: The Commerce Department reported Wednesday that orders placed with U.S. factories rose by a solid 0.7 percent in June from the month before. The performance exceeded economists' expectations for a 0.5 percent advance. The increase, the largest since March, was up from a 0.4 percent rise in May.
CHANNEL DISTRICT CONDOS ADVANCE: Developers of a planned 340-unit condo project in Tampa's Channel District said Wednesday they closed last week on a 6 acre site. Pinnacle Place Development Partners said it paid three owners more than $14.5-million for the property, on which it will build two 40-story condo towers, low-rise units and about 100,000 square feet of retail. Pinnacle expects to break ground on the first tower and retail space in early 2005, the partnership said.
PAPER'S OWNERS TO BUY OUT COX: The family that owns 52.5 percent of the Daytona Beach News-Journal said it will buy out Cox Enterprises' 47.5 percent ownership because of a lawsuit filed by Cox. The Davidson family has 60 days to negotiate a price with Cox or a federal judge in Orlando will set a fair value. If the Davidsons can't pay a court-ordered price, the newspaper could be put up for sale. Media giant Cox sued the paper and its owners in May after the family paid $13-million for naming rights to a community arts center in which the Davidsons are involved. A hearing is scheduled today on a motion by Cox to stop construction on the center and freeze the $13-million until the case is resolved.
8.5,ux0 SHELLS GETS DEAL ON DEBT: Shells Seafood Restaurants said Wednesday it has reached a deal to restructure $2-million in loans that it would have struggled to repay. The Tampa company, which owns or manages 25 restaurants in Florida, said lenders agreed to let it defer principal and interest payments by two years in exchange for the right to purchase 2-million shares of stock at 50 cents apiece. Shells had said it might not have cash to cover the two $1-million promissory notes, one of which was issued by its largest shareholder, Frederick Adler. Shells' stock closed Wednesday at 72 cents per share, up 17 cents.
SPITZER SUES BENEFIT MANAGER: New York authorities sued Express Scripts Inc., one of the nation's largest pharmacy benefit managers, for fraud, alleging the company pocketed as much as $100-million in drug rebates that should have gone to the state. The suit is the latest accusation against the pharmacy benefit managers industry. New York Attorney General Eliot Spitzer and state Civil Service Commissioner Daniel Wall accused the firm of violating its $600,000 contract to negotiate the lowest prices for drugs under health plans for state workers. The state is seeking tens of millions of dollars, plus penalties and fines, Spitzer said.
ALLTEL BUYS INTO FORT PIERCE: Alltel Corp. announced a $140-million deal Wednesday that expands its ownership in five states and into two new wireless properties in Florida and southeastern Ohio. The agreements were to acquire assets from United States Cellular Corp. and TDS Telecom, the Little Rock, Ark., telecommunications company said. The increased partnership interests are in seven markets in five states: Georgia, Mississippi, North Carolina, Ohio and Wisconsin. New markets are in Fort Pierce and southeast Ohio.
OIL PRICES GROUND AIRLINE PROFITS: Airlines will lose as much as $6-billion this year on international routes if oil prices stay at the record highs reached Tuesday, the International Air Transport Association said. "We went from forecasting a gain of $3-billion at the beginning of the year to a $6-billion loss now," said Anthony Concil, a spokesman for IATA in Geneva. IATA, which represents more than 270 airlines worldwide, had based its prediction of a profit on an average price of $30 per barrel. Giovanni Bisignani, the association's director general, said June 7 the industry would break even if the price averaged $33 a barrel this year.
DELTA PILOTS WANT PAIN SHARED: Delta Air Lines' pilots union said Wednesday the struggling carrier will edge closer to bankruptcy if management continues to seek $1-billion in concessions from them without asking other stakeholders to tighten their belts. The chairman of the union's executive committee, John Malone, made the comment in a strongly worded letter to other pilots. The letter was a response to the Atlanta airline's request Friday for the pilots union to give up $1-billion in concessions, including a 35 percent pay cut and work, scheduling and pension changes.
US AIRWAYS MAY DEFAULT: US Airways Group Inc., seeking cost cuts to avoid a second bankruptcy filing, said it may default on terms of a U.S. loan guarantee this quarter. US Airways "anticipates risk of failing to comply" with requirements for the $900-million guarantee as of Sept. 30, according to a filing with the Securities and Exchange Commission. The Air Transport Stabilization Board, set up after the 2001 terrorist attacks to oversee guarantee grants, gave US Airways backing for a $1-billion loan that financed its exit from bankruptcy in April 2003. The board could demand repayment, the filing said.
EU SUGAR SUBSIDIES IN VIOLATION: The World Trade Organization found European Union subsidies for sugar producers violate global trade rules, upholding a complaint filed by Brazil, Australia and Thailand, Brazilian foreign minister Celso Amorim said. A preliminary ruling by the trade body found that the EU has violated limits on export subsidies, Amorim said. Amorim declined to offer details of the ruling, but told reporters in Brasilia it was a victory for Brazil's sugar producers, who have complained for years that they could significantly boost exports if the subsidies were eliminated.
BELLSOUTH UNION OKAYS STRIKE: The roughly 47,000 union employees at BellSouth Corp. have authorized a strike if they can't reach a fair contract with management, officials said Wednesday. Key sticking points include health care costs and job security at the Atlanta company. The three-year contract between BellSouth and the Communications Workers of America expires at midnight Saturday. While a strike has been approved, no deadline or date has been set, said CWA spokeswoman Candice Johnson.
Danka Business Systems: Danka, a seller and servicer of office technology manufactured by such companies as Canon and Ricoh, said its revenues fell 7 percent in the quarter ended June 30, or 10 percent after adjusting for currency fluctuations. But its gross margin of 38 percent was the highest in eight quarters.
Cigna Corp.: The employee benefits provider swung to a profit in the second quarter, citing improvement in its health, disability and life insurance programs and a boost from an asset sale, and raised its earnings guidance for the full year.
CVS Corp.: The Woonsocket, R.I., drugstore chain that just acquired 1,260 Eckerd Corp. stores said it plans to have about half the 622 Eckerds in Florida converted to CVS pharmacy stores by Christmas. The company also trimmed by 25 the number of Eckerds it plans to close to "fewer than 200." The company changed its mind about some unprofitable Eckerds it hopes to turn profitable. The company exceeded analysts' earnings expectations by 2 cents a share during the quarter ended July 3. CVS sales in stores open more than a year increased 6 percent.
Reptron Electronics Inc.: The Tampa electronics manufacturer, which sold its distribution business in June 2003, reported a 10 percent drop in sales from continued operations in the quarter ended June 30. Its net loss for continued operations was $174,000 compared with a net loss from continued operations of $711,000 in the same quarter a year ago.
Univision Communications Inc.: the Spanish-language media giant reported Wednesday that strong advertising sales helped it more than double its profits in the second quarter. Analysts surveyed by Thomson First Call had been expecting 19 cents per share.
Orbitz Inc.: The online travel company posted a profit in the second quarter, helped by growth across all major product lines.