Microsoft Corp. on Monday won a reprieve in its battle with rival Sun Microsystems. A federal appeals court in Richmond, Va., stayed an order requiring Microsoft to include Sun’s Java programming language in its Windows operating system. The order, from the 4th U.S. Circuit Court of Appeals, came the day before an order from a lower court was to take effect, requiring Microsoft to include Java in its Windows XP software within 120 days.
SHORT-TERM T-BILL RATES RISE
Interest rates on short-term Treasury securities rose in Monday’s auction. The Treasury Department sold $19 billion in three-month bills at a discount rate of 1.155 percent, up from 1.140 percent last week. An additional $17 billion was sold in six-month bills at a rate of 1.185 percent, up from 1.160 percent. Both the three-month and six-month rates were the highest since Jan. 21 when the bills sold for 1.160 percent and 1.190 percent, respectively.
LIMITED TO BUY BACK SHARES
Clothing retailer Limited Brands Inc. said Monday it will buy back up to $150 million of stock. Companies use buybacks to increase earnings per share by reducing shares outstanding. Limited had about 523.1 million shares outstanding as of Nov. 29. The buyback represents about 2 percent of the company’s stock. Limited closed Monday up 7 cents at $12.66 on the New York Stock Exchange. Also Monday, the company announced it was increasing its quarterly dividend from 7.5 cents a share to 10 cents.
FAO FILES RECOVERY PLAN
FAO Inc., the parent of FAO Schwarz, Zany Brainy and Right Start toy stores, filed a reorganization plan with the Delaware bankruptcy court to emerge from Chapter 11 protection. The company also said it had obtained court approval to begin store closing sales and reject leases at 83 of its 255 stores. FAO said it expects to emerge from bankruptcy in the second quarter of this year, and is in talks to obtain up to $107 million of new financing. The company operates an FAO Schwarz and a Zany Brainy store in Orlando.
CSFB PLACES EXECUTIVE ON LEAVE
Credit Suisse First Boston placed the head of its global technology group on administrative leave Monday after an internal probe found he may have known regulators were eyeing his firm when he told his staff to “clean up” their files two years ago. CSFB revisited the matter with Frank Quattrone last week, when it uncovered an e-mail exchange between the star investment banker and former in-house legal counsel David Brodsky, The Associated Press reported. The National Association of Securities Dealers reportedly is considering action against Quattrone on other issues.
LATIN AMERICA
PICU SUSPENDS OPERATIONS
Puerto Rico’s largest chicken processing company announced Monday it has indefinitely suspended operations, leaving 500 employees without jobs as the company tries to restructure. Picu Cos. filed for Chapter 11 in federal court on Monday, said Samuel Reyes, chairman of the board of directors. “Picu has not closed, it has stopped processing chickens until we can resolve a cash flow problem,” Reyes told a news conference. The company has not said how much money it lost last year.
WORLD
LEGO TO CUT 161 EMPLOYEES
Danish toy maker Lego said Monday it cut its work force in Denmark by 161 because of a slowdown in retail sales during the Christmas holiday in Germany and the United States, two of its major markets. The slow sales resulted in an oversupply of stock still in its warehouses, the company said. The workers were at Lego’s headquarters in Billund, 155 miles west of Copenhagen. The company has 8,000 employees in 30 countries.
EARNINGS
US Airways Group Inc. reported a fourth-quarter net loss of $794 million, or $11.67 per share, compared with a record-breaking quarterly loss of $1.2 billion, or $17.07 per share, the year before. Revenue grew to $1.61 billion from $1.57 billion the year before. Excluding unusual items, the loss for the quarter was $4.33 a share. Analysts had predicted losses of $3.11 a share. For the year, the company lost $1.65 billion on revenue of $7 billion.
Health-care provider Humana Inc. reported fourth-quarter loss of $1.7 million, or 1 cent per share, compared with a profit of $35.1 million, or 21 cents a share, a year earlier. Revenue rose to $2.86 billion from $2.62 billion. Excluding charges, Humana would have earned 34 cents per share, 1 cent a share above analysts’ estimates. For the year, Humana reported net income of $142.8 million, or 85 cents per share, on revenue of $11.26 billion.
Mattel Inc. reported fourth-quarter profits of $186 million, or 42 cents per share, compared with $138 million, or 31 cents per share, in the same quarter last year. Revenue rose to $1.67 billion, compared with $1.56 billion in the same period last year. Without one-time charges, Mattel said its net income for the quarter was 43 cents per share, 5 cents a share above analysts’ estimates. For the full year, Mattel said net income was $230 million, or 52 cents per share, on revenue of $4.89 billion.
