Business News in Brief

Posted: June 22, 2012

IN THE REGION

Rite Aid loss shrinks for quarter

Rite Aid Corp. reported a smaller loss for the first quarter than it had a year ago as revenue from the Camp Hill, Pa., drugstore chain's established stores continued to rise. The company said Thursday it lost $30.7 million, or 3 cents per share, in the quarter that ended June 2. That compares with a net loss of $65.5 million, or 7 cents per share, in last year's quarter. Revenue rose 1 percent to $6.47 billion from $6.39 billion a year ago. Revenue at stores open at least a year grew 2.5 percent. Revenue at stores open at least a year is considered a key indicator of retailer health because it leaves out results from locations that have opened or closed in the last year. Its shares rose 8 cents, or 6.8 percent, to $1.25. — AP

Giant to start changing Genuardi's stores

Giant Food Stores said Thursday it would begin converting 15 former Genuardi's supermarkets in the region on June 29. Stores on Boot Road in West Chester, Huntingdon Pike in Huntingdon Valley, York Road in Jamison, Baltimore Pike in Kennett Square, and Sumneytown Pike in North Wales will close June 28 at 6 p.m., and reopen July 8 at 8 a.m. Stores on Wynnewood Road in Wynnewood, Bethlehem Pike in Spring House, Baltimore Pike in Springfield, South Henderson Pike in King of Prussia, and Susquehanna Road in Roslyn will close July 5 at 6 p.m., and reopen July 15 at 8 a.m. Stores on Bethlehem Pike in Flourtown, Norristown Road in Maple Glen, North Flowers Mill Road in Langhorne, County Line Road in Chalfont, and East Lancaster Avenue in St. Davids will close July 12 at 6 p.m., and reopen July 22 at 8 a.m. In-store banks will remain open and pharmacies will be closed for only a few days, the grocer said.  — Maria Panaritis

New bill to require energy reports

Philadelphia City Council on Thursday unanimously approved an ordinance that will require owners of large commercial buildings to report their energy consumption to government under a new system that will "benchmark" properties for efficiency in an effort to spur conservation. The new rule, sponsored by Councilwoman Blondell Reynolds Brown, requires owners of buildings larger than 50,000 square feet to score their properties according to an Energy Star ranking developed by the U.S. Environmental Protection Agency. Advocates hope the public rankings will provide building owners, as well as prospective buyers and tenants, with comparative energy-efficiency data. The new rule will go into effect on June 1, 2013, and be administered by the city's Office of Sustainability. Failure to comply would be punishable by a $300 fine for the first 30 days and then $100 a day.  — Andrew Maykuth

Flight attendants ratify contract

Flight attendants for Air Wisconsin, which operates as a US Airways Express carrier at Philadelphia International Airport, ratified a new labor contract with the airline Thursday, according to the union that represents the 300 flight attendants. Terms of the four-year pact were not disclosed, but the union said it included "increased compensation and improvements to scheduling and quality of life issues." From hubs in Philadelphia, Washington, New York, Raleigh, N.C., and Norfolk, Va., Air Wisconsin operates nearly 500 daily flights as US Airways Express, serving 70 cities in the United States and Canada.  — Paul Nussbaum

ELSEWHERE

Oil at lowest price in nine months

The price of oil fell to its lowest level in almost nine months Thursday: $78.20 a barrel. Gasoline is way down, too, at $3.47 a gallon. The national average for gas is 17 cents cheaper than a year ago and down 46 cents from its peak in early April. Experts say it could dip to $3.30 by July 4th. Oil fell Thursday after reports from China and the United States both pointed to a slowdown in manufacturing. As factories fill fewer orders, they use less energy, and that cuts into petroleum demand. The price of oil has fallen by nearly $32 a barrel, or 29 percent, since its high of $109.77 on Feb. 24.   — AP

Index shows modest growth

A measure of future U.S. economic activity rose in May to the highest level in four years, a sign the economy will keep growing but at a modest pace. The Conference Board said its index of leading economic indicators rose 0.3 percent last month, after a 0.1 percent drop in April. April's drop was the first in seven months. The index is now at 95.8. The last time it was higher was June 2008, six months into the Great Recession. Prior to the recession, the index routinely topped 100. Seven of the ten components of the index rose last month. The biggest drivers of the increase in the index were building permits, the spread between short-term and long-term interest rates, and an increase in new manufacturing orders, according to a survey by the Institute for Supply Management. — AP

Google shareholders OK stock move

Google shareholders have approved an unconventional stock split that will ensure that the company's co-founders remain in control. The plan passed Thursday at Google's annual shareholder meeting calls for the creation of a new class of non-voting stock. Larry Page and Sergey Brin, who started Google in 1998, wanted the non-voting stock to prevent the possibility that their authority would be undermined as the company issues more shares to compensate employees and finance future acquisitions. Thursday's approval was a foregone conclusion because Page and Brin already control more than 56 percent of the voting power at Google. But Google Inc. doesn't expect the split to occur until late this year because of a shareholder lawsuit seeking to block the move. — AP

New chairman for Chesapeake

Chesapeake Energy Corp. has named a new chairman to replace its controversial founder, Aubrey McClendon. McClendon, who remains CEO and president, was stripped of his chairmanship after a series of corporate governance issues angered investors. The issues included a report that McClendon took a personal loan from a company that was doing business with Chesapeake. In McClendon's place, Chesapeake appointed Archie Dunham, a former ConocoPhillips chairman, as an independent non-executive chairman. Dunham, 73, has no prior relationship with Chesapeake. The company has extensive operations in the Marcellus Shale region. It also appointed four new directors chosen by the company's biggest investors. -The new board must work to reassure investors who have seen Chesapeake's share price drop 34 percent in the past year. For years, shareholders have criticized the way Chesapeake compensates McClendon and have called for greater accountability from the board. They're also concerned about the company's huge debts and aggressive spending plans at a time when natural gas prices are near decade lows. The company is planning to sell up to $14 billion in assets this year to help pay off debts. — AP

SmartMoney goes digital only

SmartMoney's print magazine is ceasing publication and switching to an all-digital format aimed at online and tablet computer users. Owner Dow Jones & Co., a unit of News Corp., said 25 positions at SmartMoney will be eliminated. It will increase SmartMoney.com's staff from nine to 15 editorial employees. SmartMoney's last print issue, the September edition, will hit newsstands on Aug. 14.  — AP

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