Business news in brief

A store advertised big discounts in Athens but is now shut. With Greece still stuck in recession, European nations are debating new support to keep it from defaulting on part of its huge debt - a step officials warn would rattle banks across Europe and hurt the continent's recovery.
A store advertised big discounts in Athens but is now shut. With Greece still stuck in recession, European nations are debating new support to keep it from defaulting on part of its huge debt - a step officials warn would rattle banks across Europe and hurt the continent's recovery. (KOSTAS TSIRONIS / Bloomberg News)
Posted: May 11, 2011

In the Region

Judge acquits ex-Glaxo attorney

A former GlaxoSmithKline P.L.C. attorney who had been accused of covering up the company's improper marketing of its antidepressant drug Wellbutrin SR won acquittal by a federal judge at her criminal trial. The pharmaceutical company has major operations in the Philadelphia area. Lauren Stevens, of Durham, N.C., was cleared of wrongdoing Tuesday by U.S. District Judge Roger Titus in Greenbelt, Md., before the case went to the jury. Titus ended the trial after prosecutors presented their evidence for 10 days and before Stevens' lawyers offered her defense. Federal judges rarely dismiss cases before jurors can decide the outcome. Prosecutors charged Stevens, a former vice president and associate general counsel for London-based Glaxo, with impeding an inquiry in 2002 and 2003 by federal regulators into the marketing of the drug for unapproved uses. - Bloomberg News

Vishay to sell $150M in debt

Vishay Intertechnology Inc., Malvern, said it was selling to institutional investors $150 million worth of debt securities that will pay 2.25 percent interest annually. The maker of chips and electronic parts will use the proceeds plus available cash to repurchase outstanding shares of its common stock, which Vishay said might increase the share price or prevent a decline. The stock hit a 52-week high of $19.08 on April 29. It closed Tuesday at $17.73, up 82 cents. - Paul Schweizer

Elsewhere

U.S. home sales rise, prices fall

Existing-home sales rose 8.3 percent nationally in the first quarter from the last three months of 2010, the National Association of Realtors reported Tuesday. But sales were 0.8 percent below the 2010 first quarter. The median price in this year's quarter was $158,700, down 4.6 percent from $166,400 the year before. Association chief economist Lawrence Yun said lower-priced housing accounted for the largest share of the 2011 quarter's sales because those homes are favored by investors and cash buyers. - Alan J. Heavens

New Microsoft policy on phone data

Microsoft Corp., responding to privacy concerns raised against makers of smartphone software, said it would stop logging and storing location data that can be traced back to specific handsets. Microsoft said in a blog post Monday that it was taking steps to eliminate the use and storage of the so-called unique device identifier from smartphones using its Windows 7 operating system. The number serves as an ID for the gadget. Federal lawmakers have increased scrutiny of how consumer data are collected from smartphones and tablet computers. Apple Inc. and Google Inc. defended how they gather location data from mobile devices Tuesday at a Senate Judiciary subcommittee hearing on the topic. - Bloomberg News

U.S. cuts oil-cost forecast

The Energy Department reduced its crude oil price forecast for 2011 as demand growth slips, non-OPEC production increases, and stockpiles climb. West Texas Intermediate oil will average $102.67 a barrel this year, down from April's projection of $106.38, the department said in its monthly Short-Term Energy Outlook. Crude prices in 2012 will average $107, a decrease from last month's estimate of $113.50. The department cut its forecast for global oil consumption for this year to 88.08 million barrels a day from 88.2 million estimated last month, the report showed. Demand will be 1.6 percent higher than last year's average of 86.68 million and will climb to 89.66 million in 2012. - Bloomberg News

Disney profit, revenue disappoint

Walt Disney Co. reported lower-than-expected net income and revenue for the second quarter, due to the poor box-office performance of "Mars Needs Moms" and the temporary closure

of theme parks in Japan from the earthquake and tsunami. Net income for the three months ended April 2 fell to $942 million, or 49 cents per share, from $953 million, or 48 cents per share, a year earlier. Revenue grew 6 percent to $9.08 billion from $8.58 billion a year earlier. Analysts polled by FactSet were looking for earnings of 57 cents per share on $9.12 billion in revenue. - AP

Portugal to pay more for bailout

The European Union's top monetary affairs official, Olli Rehn, said that Portugal would have to pay more than 5.5 percent in interest for its rescue loans - more than what Greece has to pay for its bailout. Greece currently has to pay just above 4 percent for its bailout, while Ireland's interest rate is at 5.8 percent. However, Rehn said he expected a deal among eurozone states to lower Ireland's interest rate "shortly." The yield on Portugal's 10-year bond has been over 9 percent for weeks, an unsustainable level that shows investors do not trust Portugal to pay back its loans. - AP

Scrushy wins reversal on two counts

Richard Scrushy, the former chief executive officer of HealthSouth Corp., won reversal of two convictions from his 2006 criminal trial, while the U.S. appeals court affirmed four other counts. The appellate panel in Atlanta sent the case back to the trial court for resentencing after reviewing the charges for a second time. The U.S. Supreme Court ordered the reexamination last year after narrowing the scope of a federal law making it a crime to deprive citizens and shareholders of the honest services of public and corporate officers. The three-judge panel upheld two of the honest-services convictions against Scrushy and former Alabama Gov. Don Siegelman, while overturning two other such counts relating to the former CEO's alleged self-dealing with the former governor's help. - Bloomberg News

Wendy's/Arby's loss narrows

Wendy's/Arby's Group Inc. plans to raise prices, following in the footsteps of competitors such as McDonald's Corp.

The company also cut its earnings

outlook because of rising costs for beef and other ingredients. The announcement also came as the company reported a first-quarter loss and said revenue at Wendy's locations had stagnated. Wendy's/Arby's net loss of $1.4 million, or break-even per share, was narrower than the loss of $3.4 million, or 1 cent per share, in the same quarter last year. Excluding a charge, the most recent quarter's earnings were 1 cent per share. Analysts expected earnings of 2 cents per share. Revenue rose about 1 percent to $848 million, beating analysts' expectations of $820 million. Last month, much larger rival McDonald's said it expected to raise prices as well, after already raising them 1 percent in early March. - AP

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