BUSINESS BRIEFS
Macy's beats expectations, despite $59M loss
Associated Press
CINCINNATI — Despite a $59 million loss and a slump in sales in the first quarter, Macy's Inc. yesterday posted results that beat Wall Street expectations because of what analysts said were tight controls on expenses and inventories.
The loss resulted from lower sales and the cost of consolidating business units, Macy's said.
Losses totaled 14 cents a share in the three months ended May 3, compared with a profit of $36 million, or 8 cents a share, in the same quarter a year ago, Macy's said. Revenue was $5.75 billion, down from $5.92 billion a year ago.
Stripping out unusual charges, earnings from continuing operations were 2 cents a share, Macy's said.
FREDDIE MAC CONCERNS REMAIN
Freddie Mac beat Wall Street's expectations in the first quarter, but the mortgage finance company didn't vanquish concerns about its ability to weather the housing bust.
Changes in accounting practices helped McLean, Va.-based Freddie Mac achieve better-than-expected results yesterday. For example, Freddie adjusted how it accounts for derivatives, financial instruments used to hedge against swings in interest rates.
Under the new accounting practices, the company said it lost more than $1.3 billion on those derivatives in the first quarter, compared with a loss of nearly $2.3 billion in the fourth quarter of 2007.
COURT OVERTURNS MERCK VERDICT
TRENTON, N.J. — A Texas appeals court yesterday overturned a multimillion-dollar verdict against Merck & Co. in one of the few trials it lost over its withdrawn painkiller Vioxx.
A jury in Rio Grande City, Texas, in April 2006 awarded $32 million to the widow of 71-year-old Leonel Garza, a short-term Vioxx user who died of a heart attack in 2001. That award — $7 million for compensatory damages and $25 million for punitive damages — later was cut to about $7.75 million under Texas law limiting damages.
Yesterday, a three-judge panel of the Texas 4th Court of Appeals overturned the verdict, ruling in favor of Merck. The opinion was signed by Justice Sandee Bryan Marion.
DEERE PROFITS UP 22 PERCENT
ST. LOUIS — Deere & Co., the world's biggest maker of farm machinery, said its second-quarter profit rose 22 percent, helped by lofty crop prices that stoked global demand for its farm equipment despite a faltering U.S. economy.
But the Moline, Ill.-based company warned that rising costs of such raw materials as steel could cut into its earnings over coming months, sending its shares down nearly 10 percent yesterday. Deere also said it was seeing spot parts shortages "cropping up."
The maker of tractors and harvesting machinery said its profit for the period ended April 30 jumped to $763.5 million, or $1.74 per share, up from $623.6 million, or $1.36 per share, during the same period last year.
SONY PROFIT NEARLY TRIPLES
TOKYO — Sony punctuated its recovery by swinging to a profit for the January-March quarter from a loss a year ago on its way to a record performance for the fiscal year as it reduced losses from its PlayStation 3 video game business.
Strong sales of flat panel TVs and digital cameras also helped nearly triple annual profit compared with the previous financial year, the electronics and entertainment company said yesterday.
But Sony joined Japanese automakers Toyota Motor Corp. and Honda Motor Co. in forecasting lower profit for the fiscal year through March 2009, citing the strong yen's erosion on overseas earnings.
Sony had been battered by a recent fall in gadget prices and the bumpy start of PlayStation 3, which required enormous startup costs and struggled against the Wii from rival Nintendo Co.
