Business Digest

© St. Petersburg Times,
published November 6, 2001

TREASURY INVESTIGATION: Treasury Department Inspector General Jeffrey Rush is part of an investigation into allegations that someone leaked market-sensitive information about the government's decision last week to stop selling 30-year bonds. Wednesday's announcement of the government's decision prompted a big bond-market rally. Treasury officials said that if Treasury concludes that a breach of rules occurred, the case could be referred to the Securities and Exchange Commission or the Justice Department for further investigation.

E-PUBLICATION SHUTS DOWN: Gulf Coast Digital, a daily electronic newsletter of tech news in the Tampa Bay area, has ceased publication. The e-mail newsletter was started as a free service in April by former LocalBusiness.com reporter Bill Holland. It began charging for subscriptions ($25 annually) in July when it was acquired by the Observer Group Inc. of Longboat Key. Excerpts of Holland's e-mails also appeared in two of the owner's print publications, the biweekly Gulf Coast Business Review and the weekly Tampa Bay Review. Holland, online editor for Gulf Coast Digital, said the newsletter had 450 subscribers when it folded Friday.

CRUISE INDUSTRY RISES: Shares of cruise line companies rose for the fourth consecutive day, lifted by encouraging news last week that Royal Caribbean Cruises Ltd. was able to postpone delivery of four new cruise ships, and thereby push back capital expenditures. For investors, many of whom were worried about liquidity, this came as wonderful news. Shares have risen steadily since, giving the entire industry, which saw demand drop off after the Sept. 11 attacks, a lift. Royal Caribbean shares rose $1.24 to $12.65, while Carnival Cruise Lines rose 37 cents to $23.94.

BRITISH AIRWAYS TRAFFIC SLUMPS: British Airways reported its passenger numbers dropped nearly 25 percent in October from a year ago, as travelers shy away from flying in the wake of the Sept. 11 terrorist attacks in the United States. BA reported a 36.2 percent fall in premium traffic and a 22.4 percent decline in economy travel. Advance bookings foretell a similar decline for November, BA said, with flights to the United States, the Middle East and Japan suffering the most. The airline plans to cut 7,000 jobs and ground 20 planes in response to the economic slowdown.

AOL, BURGER KING FORM PACT: Burger King and AOL Time Warner on Monday announced a marketing agreement that would give the fast-food customers access to special sports, music and entertainment features. The 11,370 restaurants that serve an estimated 12-million people daily also could be a distribution point for AOL software. Terms of the deal were not disclosed.

NORTHWEST CHANGES FARE STRUCTURE: Northwest Airlines has overhauled its fare structure, cutting leisure fares 25 percent and increasing the number of business fares eligible for corporate discounts. Airlines have run an array of sales and promotions in recent weeks to stimulate demand for travel. The changes at Northwest, however, are permanent changes to the way it prices tickets.

TREASURY AUCTION: Interest rates on short-term Treasury securities fell in Monday's auction. The Treasury Department sold $16-billion in three-month bills at a discount rate of 1.975 percent, down from 2.050 percent last week. An additional $15-billion was sold in six-month bills at a rate of 1.920 percent, down from 2.005 percent. The new discount rates understate the actual return to investors: 2.012 percent for three-month bills and 1.966 percent for a six-month bill. In a separate report, the Federal Reserve said Monday that the average yield for one-year constant maturity Treasury bills fell to 2.11 percent last week from 2.31 percent the previous week.

Cisco Systems Inc.

Excluding one-time items, including a $858-million investment charge, the San Jose, Calif., tech company earned 4 cents per share, beating Wall Street's expectations for the fiscal quarter ended Oct. 27.

   1stQtr                  Year Ago
   Revenue $4.4-bil        $6.5-bil
   Net Income -$268-mil    $798-mil
   Per Share -4 cents      11 cents
   

PlanVista Corp.

The Tampa medical claims processing company said it lost $1.1-million on continuing operations last quarter and set aside another $32-million in loss reserves to bring its financial statements in compliance with accepted accounting procedures. Revenues rose 10 percent for the third quarter ended Sept. 30. Year-to-date claim-processing volume is up 33 percent over the same period last year.

   3rdQtr                  Year Ago
   Revenue $7.9-mil        $7.1-mil
   Net Income -$34.9-mil   -$35.5-mil
   Per Share -$2.28        -$2.59
   

Medical Technology Systems Inc.

The Clearwater drug-packaging company said income from continuing operations would have jumped 50 percent in the fiscal quarter ended Sept. 30 after adjusting for a reverse stock split and tax-related items.

   2ndQtr                  Year Ago
   Revenue $5.7-mil        $4.9-mil
   Net Income $439,000     $460,000
   Per Share 10 cents      18 cents
   

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