Business news in brief
In the Region
Air Products cuts jobs, guidance
Air Products & Chemicals Inc.
, which supplies oxygen and other gases to the industrial and medical sectors, said yesterday it was cutting about 7 percent of its workforce because of weak business conditions worldwide. The Trexlertown, Pa., company will slash 1,300 jobs and take a fiscal first-quarter charge of $140 million to $160 million, or 43 to 50 cents a share, mostly for severance payments. The company said the moves could reduce costs in fiscal 2009 about $50 million, with savings of $110 million in fiscal 2010 and beyond. Its shares rose $1.88, or 3.87 percent, to close at $50.42. Air Products now expects profit from continuing operations between 95 cents and $1 a share for the quarter ending Dec. 31, down from prior guidance of $1.15 to $1.21 a share.
Vishay lowers Q4 revenue outlook
Vishay Intertechnology Inc.
, a maker of semiconductor and electronic components, lowered its revenue estimates for the current quarter because of the economic downturn. Vishay, Malvern, now expects fourth-quarter revenue to be in the range of $560 million to $590 million, down from the previous projection of $640 million to $670 million. Revenue in the fourth quarter of 2007 was $729.6 million. In addition, gross margin is projected to be lower than in the third quarter, when it was at 21.6 percent.
- Reid Kanaley
4 to pay penalty over milk futures
An Ambler man is among four executives penalized for improper trading in milk futures, the
Commodity Futures Trading Commission
, of Ambler, the former president and chief executive officer of a subsidiary of
Dairy Farmers of America Inc.
, will pay $60,000 for helping the DFA exceed its speculative position limits. Otis could not immediately be reached for comment, but Monday's government action is a settlement in which Otis does not admit or deny any of the findings in the original complaint. A former executive vice president of the subsidiary,
, will pay $150,000. Bigger fines will be paid by the former chief executive officer of the Kansas City, Mo., dairy-marketing cooperative,
, and its former chief financial officer,
. They were to pay a penalty of $12 million for trying to manipulate Class III milk futures in 2004 by buying block cheddar cheese on the Chicago Mercantile Exchange's Cheese Spot Call market. The prices of both tend to be intertwined.
- Jane M. Von Bergen
Neighborhood newspapers closed
Three neighborhood newspapers - the Olney Times, the News Gleaner, and the Northeast Breeze - were closed, effective last Thursday. Also closed was a monthly publication called Life. The papers are owned by the troubled
Journal Register Co.
, a Yardley publisher of 22 daily newspapers and more than 300 nondaily publications. Local dailies published in the region include the Times Herald in Norristown, the Daily Local News in West Chester, and the Trentonian.
- Jane M. Von Bergen
A loss for Goldman Sachs
Goldman Sachs Group Inc.
reported its first quarterly loss since it went public in 1999, dropping $2.29 billion during its fiscal fourth quarter. The loss proves the turmoil in the financial markets has tripped up even the best-run financial institutions. The Wall Street firm lost $4.97 a share in the quarter ended Nov. 30. In the year-earlier quarter, Goldman earned $3.17 billion, or $7.01 a share. The news was not as bad as investors had feared, so the firm's shares closed up $9.54, or 14.35 percent, at $76.00.
FDIC increases bank fees
Federal Deposit Insurance Corp.
has doubled fees U.S. banks pay to insure customers' deposits, to rebuild reserves drained this year by the failure of 25 banks.
- Bloomberg News
Crude sinks despite talk of OPEC cuts
Oil prices fell even after OPEC powerhouse Saudi Arabia said oil production would be cut two million barrels a day to stem declining crude prices. The
Organization of Petroleum Exporting Countries
is expected to slash production levels today. The severity of the downturn in the United States has led to a sharp drop in oil prices. Light, sweet crude for January delivery fell 91 cents to settle at $43.60 a barrel on the New York Mercantile Exchange.
AIG official may face Congress
American International Group Inc.
chief executive officer Edward Liddy may face a congressional hearing to explain "the full extent" of the insurer's plan to give bonuses to as many as 7,000 people so they will not quit. Liddy should testify under oath on why retention payments are going to thousands more people than first disclosed, according to a letter from Rep. Elijah Cummings (D., Md.) of the House Committee on Oversight and Government Reform. He cited a Bloomberg News report that says AIG will give as much as a year's pay to about 10 percent of the staff at units that are being sold. Recipients were told to keep the awards secret. Hearings may put new pressure on AIG to detail why managers will get as much as $4 million after the company accepted a taxpayer-funded bailout now valued at about $150 billion and promised to curtail pay.
- Bloomberg News
Credit unions expand loan program
A growing number of credit unions in the Midwest and South are pledging an additional $12 billion in low-cost auto loans and joining with
to offer rebates to lift sagging auto sales. The 2,500 credit unions in 12 states said their members would be eligible for rebates of $500 or $1,000 on nearly all Chrysler, Jeep and Dodge vehicles financed through the unions until June 30. Last week, about 1,200 credit unions in Michigan, Ohio, Indiana and Illinois set aside $10 billion to finance auto purchases and teamed with
General Motors Corp.
to offer discounts on GM vehicles.
Microsoft issuing emergency fix
is taking the unusual step of issuing an emergency fix for a security hole in its Internet Explorer software that has exposed millions of users to having their computers taken over by hackers. The "zero-day" vulnerability allows criminals to take over victims' machines simply by steering them to infected Web sites. Users don't have to download anything for their computers to get infected, which makes the flaw in Internet Explorer's programming code so dangerous.