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DECEMBER 8, 2003
Edited by Monica Roman Robert Lane: Digging Out Deere  Maybe Robert Lane can finally relax. Only months after he became chairman and CEO of Deere in mid-2000, the nation's industrial and farm sectors hit a rough patch. Deere was soon wheel-deep in the red as it took charges to lay off workers and close plants. Now, the cost-cutting and economic rebound may be giving Deere a lift. On Nov. 25, the Moline (Ill.) company said it expects profits for its first quarter, ending on Jan. 31, to leap at least 47% from a year earlier, to $100 million to $150 million, on a 25% rise in sales. In addition, Deere forecast that net income for the fiscal year ending next Oct. 31 will total $750 million or more, up at least 17%. It projects 2004 sales to rise 10% with help from a weak dollar and stronger U.S. farm and lawn markets.Lane, 54, is glad this year's fourth quarter is behind him. Although sales grew 14%, to $3.94 billion, earnings rose only 4%, to $71 million. "There's no rest in sight," he says, "because our aspirations are so lofty." Still, the road is getting smoother. By Michael Arndt Sudden Exits At HP In a surprise move, rising star Jeff Clarke resigned on Nov. 25 as executive vice-president of global operations at Hewlett-Packard. HP insiders expected Clarke, former chief financial officer of Compaq Computer, to soon succeed longtime HP CFO Robert Wayman at the $73 billion computing behemoth. HP said Clarke's resignation was agreed to "mutually." Clarke said he had been waiting to become CFO for 26 months. But with Wayman not set to leave soon, according to Clarke, "that job wasn't available." Suzette Stephens, HP vice-president of global communications, resigned the same day as Clarke. Top HP managers were aware of a relationship between Clarke and Stephens, sources say. "My relationship with Suzette is a personal matter," Clarke says. Stephens did not return phone calls.   No Security, No Trust  In the latest chapter in the mutual-fund industry's ongoing scandal, New York Attorney General Eliot Spitzer on Nov. 25 announced felony charges against three former executives of Phoenix-based Security Trust for assisting in illegal late trades of mutual funds. The Securities & Exchange Commission also filed civil fraud charges against the company and its former execs. The Office of the Comptroller of the Currency will dissolve Security Trust by Mar. 31 while safeguarding pensioners' interests. The company said that it "will continue to cooperate with all authorities." A lawyer for former CEO Grant Seeger said he "did nothing illegal." Lay "Should Have Known" In a report released on Nov. 24, Enron bankruptcy examiner Neal Batson criticized former Chairman Kenneth Lay and President Jeffrey Skilling, saying they "knew or should have known their subordinate officers misused the [special-purpose entity] transactions in a manner that resulted in the dissemination of materially misleading financial information." The two have said that they are innocent. So far, no criminal charges have been brought against them, and the report hints a smoking gun will be hard to find. "[B]oth Lay and Skilling were infrequent users of e-mail, and they also apparently did not retain many documents," it said. A Broadcast Bonanza Broadcasters such as Viacom and News Corp. can breathe a little easier -- for now. Lawmakers working on next year's federal spending bill had planned to gut new Federal Communications Commission rules allowing TV networks to own local stations covering up to 45% of the nation's audience, up from 35%. President Bush had threatened to veto the bill over the issue. But the White House reached a compromise on Nov. 24 with Republican Hill leaders calling for a local-station cap of 39%. Both Viacom and News Corp. are under the new limit, but they're not in the clear yet: Congress may leave for the holidays without passing the bill. Et Cetera... -- Intel is producing the first of new powerful chips at 65 nanometers. -- Moody's projects global cigarette sales will grow less than 1% annually over the next three years. -- Indie film companies filed suit to allow DVDs to be sent to potential Oscar voters. Closing Bell: Boston Scientific  Boston Scientific shares rose 5.3% on Nov. 24 to hit a high of $35.70, after a U.S. court refused Johnson & Johnson's request to bar Boston Scientific's new drug-coated stent. FDA approval is expected early next year, making it the only rival to J&J in a $5 billion market.
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