Markets & Finance

GM, UAW Agree to Health Care Cuts


General Motors (GM) shares moved higher Monday after the company and the United Auto Workers reached a tentative pact to cut health-care costs by about $15 billion. The company will need to cut 25,000 or more manufacturing jobs. It is exploring options to further enhance GMAC's liquidity position. It posted a $1.92 third quarter loss, excluding items.

Advanced Neuromodulation Systems (ANSI) agreed to be acquired by St. Jude Medical (STJ) for $61.25 cash per share, totaling about $1.3 billion. St. Jude posted 44 cents vs. 25 cents third quarter earnings per share (reported) on a 28% sales rise. It sees 39 cents to 40 cents fourth quarter earnings per share. S&P kept a strong buy on the stock.

Krispy Kreme Doughnuts (KKD) shares moved lower Monday after an earlier delay in trading. It says its majority-owned unit and franchise partner in the Philadelphia region, Freedom Rings, LLC, has filed for Chapter 11.

Refco (RFX) says it is in talks with a group of investors led by J.C. Flowers & Co. for the sale of the company's futures brokerage business.

Altria Group (MO) shares were seen higher amid reports that the US Supreme Court rejected the US government's appeal to reinstate a potential $280 billion penalty in its case against cigarette makers.

Transocean (RIG) set a $2 billion stock buyback.

Mattel (MAT) posted 55 cents vs. 61 cents third quarter earnings per share on unchanged sales. It says the sales increases in much of its portfolio were offset by declines in the Barbie brand. It also noted a difficult retail environment and cost increases.

Citigroup (C) posted $1.38 third quarter earnings per share on a 15% revenue rise. It posted 97 cents third quarter earnings per share from continuing operations.

Goody's Family Clothing (GDYS) received an acquisition proposal of $8.85 cash per Goody's share, possibly higher after due diligence, from a second competitive bidder. It takes into account obligations to pay a termination fee on its merger deal with a Sun Capital unit.

Saks (SKS) posted 6 cents second quarter earnings per share vs. an 18 cents loss (both quarters include items) on 2.1% higher same-store sales, and a 2.6% total revenue decline.

Hasbro (HAS) posted 47 cents vs. 43 cents third quarter earnings per share on a 4.3% revenue rise.

Newell Rubbermaid (NWL) CEO Joseph Galli resigned and Mark Ketchum, a member of Newell's board and Audit Committee, will serve as the Interim CEO. The company expects third quarter earnings per share from operations to be at the high end or above the previously announced range. S&P kept its hold on the stock.

Industrial Distribution Group (IDGR) said it sees $130 million to $135 million third quarter revenues from continuing operations. It cut its $560 million to $570 million 2005 revenue from continuing operations forecast to between $535 million and $545 million. It noted a number of customers experienced a decline in manufacturing production levels.

Wachovia (WB) posted $1.06 vs. 96 cents third quarter GAAP earnings per share on a 19% revenue rise.

Charles Schwab (SCH) posted 16 cents third quarter earnings per share vs. a 3 cents loss on a 14% revenue rise.

Lear (LEA) and WL Ross & Co. LLC signed an agreement providing for a joint venture relationship to explore strategic acquisition opportunities in the automotive interior components sector.

Koninklijke Philips Electronics N.V. (PHG) posted EUR 1.44 billion vs. EUR 1.17 billion third quarter net income on a 5% sales rise. The results include a EUR 635 million non-taxable gain.

China Techfaith Wireless Communication Technology (CNTF) expects third quarter revenue to be about US$23 million or 10% over the second quarter, vs. a previously expected 10% to 15% sequential revenue growth forecast. It cited the fast growth of the domestic black market for cheaper, unauthorized handsets.

Libbey (LBY) sees 30 cents third quarter earnings per share on $135.6 million sales. It says lower-than-expected sales are the result of a fall-off of international sales as well as domestic sales to retail and industrial customers.

Supervalu (SVU) posted 24 cents vs. 55 cents second quarter earnings per share, as 31 cents in charges offset a 1.5% sales rise. It says it is pleased that when excluding charges, it matched a record second quarter fiscal year 2005 earnings per share despite a soft sales environment. It sees $1.88 to $1.98 fiscal year 2006 earnings per share.

Methode Electronics (METH) says it is owed about $7.8 million by Delphi (DPH); it anticipates taking a charge to second quarter earnings per share relating to this receivable.

Abbott Laboratories (ABT) initiated a correction and notification to its blood glucose meter users. It says it's working with the Food and Drug Administration to execute the device correction, as users complained they've inadvertently changed units of measure on the device.

Lannett (LCI) received approval from the Food and Drug Administration of its Abbreviated New Drug Application for Pilocarpine HCl tablets for the treatment of dry mouth caused by radiation therapy for head and neck cancer.

Nortel Networks (NT) appointed M. Zafirovski as its president and CEO, replacing Bill Owens. S&P reiterated its hold on the stock.

Varian Medical Systems (VAR) said that demand for new products for IGRT (image-guided radiation therapy) and stereotactic radiotherapy helped to drive strong net order growth during the fourth quarter. It sees about an 18% increase in fourth quarter net orders vs. a year ago.

RSA Security (RSAS)sees 20 cents to 22 cents third quarter earnings per share, including the favorable impact of income tax refunds in the range of 8 cents to 9 cents, on $76 million of revenue. S&P reiterated its buy on the stock and Jefferies downgraded it to hold from buy.

Sensient Technologies (SXT) posted 30 cents vs. 46 cents third quarter earnings per share on slightly lower revenue. It says it is evaluating actions to reduce costs by lowering headcount and rationalizing certain facilities.

BioCryst Pharmaceuticals (BCRX) filed a special protocol assessment with the Food and Drug Administration for the design of its proposed registration trial of Fodosine. It noted that the trial is to evaluate the efficacy and safety of Fodosine in patients with relapsed or refractory T-Cell leukemia.

Bio-Logic Systems (BLSC) agreed to be acquired by Natus Medical(BABY) in a $66 million deal, at $8.77 per Bio-Logic Systems share.

LeapFrog Enterprises (LF)says its FLY Pentop Computer is available at major consumer electronics stores. It notes that the platform was hailed by pundits and reviewers for its technology, which transforms pen and paper into an interactive computer. Wedbush Morgan kept its hold opinion on the stock.

Sirva (SIR) agreed to sell the Australian and New Zealand operations of its Pickfords Records Management unit to Iron Mountain (IRM) for approximately $87 million.

Gen-Probe Incorporated (GPRO) was advised by the Food and Drug Administration that it will have additional questions regarding the company's Biologics License Application for Procleix Ultrio assay. It believes the approval of assay on its enhanced semi-automated system may be delayed into 2006.

Isonics (ISON) launched the marketing and sales of a new system that monitors and identifies chemical weapons and toxic substances in airports, mass transit facilities, sports venues, in public, and at private sector office buildings.


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