In the Region

FAA: Drone idea doesn't fly

A Philadelphia entrepreneur who wants to use small drones to fly advertising above the city cannot do so without authorization from the Federal Aviation Administration, an agency spokesman said Tuesday. DroneCast, a company formed by a 19-year-old former Drexel student, says it will use small, remote-controlled aircraft to carry advertising banners about 25 feet above the ground, according to the company's website. But that plan flies in the face of FAA rules, which require any commercial use of U.S. airspace to use a licensed pilot and a certified aircraft, with FAA authority. "It does not sound like it would meet those requirements," FAA spokesman Les Dorr said Tuesday. He said he did not know whether the FAA has been notified of DroneCast's plans or whether an effort is underway to ground the company's drones. - Paul Nussbaum

Merck profit up

Major cost cuts enabled drugmaker Merck & Co. to offset lower first-quarter sales as generic competition continues to hurt sales of former blockbuster medicines. Merck's profit rose 7 percent, trouncing Wall Street expectations. Merck said it plans to rely on its pipeline of experimental drugs for future sales. Net income was $1.71 billion, or 57 cents per share, up from $1.59 billion, or 52 cents per share, a year earlier. Excluding $896 million in restructuring and acquisition charges, net income was $2.6 billion, or 88 cents per share - 9 cents better than analysts expected. Revenue totaled $10.26 billion, down 4 percent and just below the $10.44 billion analysts expected. - AP

Jobless rate for region falls

Unemployment in the Philadelphia region fell in March, with the rate dropping to 6.7 percent from 6.9 percent in February and 8.1 percent a year ago, the U.S. Labor Department said. The number of jobs in the region increased to 2.7 million, up 4,000 from a year ago. Burlington, Camden and Gloucester Counties together reported an unemployment rate of 7.7 percent in March - the highest in the region - down from 8 percent in February and 9 percent a year ago. The number of jobs for those counties also fell - a disparity that often indicates that people, discouraged by their inability to find a job, stopped looking and left the labor force. The statistics were not seasonally adjusted. - Jane M. Von Bergen

Phone chargers recalled

Almost 100,000 mobile phone chargers made by DGL Group are being recalled after complaints of melted parts, smoking, leaking batteries and fire. The chargers, known as Vibe USB Mobile Power Bar, were sold for $5 at discount Philadelphia retailer Five Below Inc. between January and March. There have been six reports of incidents, the U.S. Consumer Product Safety Commission said, which have led to bursting power bars and minor property damage. - AP

Endo buys Mexico's Somar

Drug and medical-device company Endo International P.L.C. said it agreed to acquire Mexico City-based Grupo Farmaceutico Somar, a privately owned generics maker. Endo, which is now based in Ireland but has large operations and its U.S. headquarters in Malvern, did not disclose a figure for the cash deal, but said Somar had 2013 revenue of about $100 million. It described Somar as having a "robust pipeline" of 60 products due for release in the next three years. - Reid Kanaley

Upgrade for Phila. Insurance

Standard & Poor's Ratings Services upgraded Philadelphia Insurance Cos. to AA- from A+ based on the Bala Cynwyd specialty insurer's status as a core operation of its parent, Tokio Marine Group, which bought Philadelphia Insurance in 2008 for $4.4 billion. However, the outlook on Philadelphia Insurance was cut to negative because S&P has that outlook on all of Tokio Marine's core operations, given its concerns about Japan's sovereign rating. - Harold Brubaker

Elsewhere

Consumer confidence flags

U.S. consumer confidence fell in April over concerns about hiring and business conditions, even though many people foresee a strengthening economy in the months ahead. The Conference Board said its confidence index dropped to 82.3 from a March reading of 83.9. Despite the decline, consumer sentiment for the last two months has been at its strongest levels since January 2008, when the Great Recession was just beginning. - AP

Twitter revenue surges

Despite a surge in revenue, Twitter Inc. shares fell after-hours after it reported a slowdown in user growth in the first quarter. The company reported revenue of $250 million, up 119 percent year-over-year, for the three months ended March 31. It had a net loss of $132 million, or 23 cents per share, compared with a net loss of $27 million in the same quarter a year earlier. - Los Angeles Times

TXU parent files bankruptcy

Energy Future Holdings filed for Chapter 11 bankruptcy reorganization in a Delaware court, an expected move that will not harm power production or distribution in Texas as the company halves its $40 billion debt load. The company owns TXU Energy, which has the largest share of the Texas retail electricity market, and Luminant, the state's largest power generator. For consumers, the short-term impact will be slight. But long-term effects are unknown and could lead to the shutdown of some power plants, a large tax bill for the company or a leaner, more competitive market - a plus for consumers who could then enjoy lower electricity bills. - AP