Tuesday, April 22, 2003

Business Digest

HealthSouth treasurer is 10th to plead guilty

BIRMINGHAM, Ala. - HealthSouth Corp. treasurer Malcolm "Tadd" McVay has agreed to plead guilty to conspiracy and fraud charges in the growing accounting scandal at the rehabilitation giant, federal prosecutors said Monday.

McVay, 41, is the 10th HealthSouth executive to reach a plea deal with the government and the fourth of the company's five former CFOs to be accused in the scheme.

The Securities and Exchange Commission accuses HealthSouth of overstating earnings by $2.5 billion since 1997.

Energy firm Williams selling another asset

TULSA, Okla. - Williams Cos. has agreed to sell its controlling stake in Williams Energy Partners for $1.1 billion, the second major asset sale in a week for the struggling energy giant. Its shares rose.

Williams said Monday it would sell its 54.6 percent ownership interest, plus its general partnership with lucrative cash distribution rights, to a new venture formed by three investment firms.

The Tulsa-based company last week announced the sale of its Texas Gas pipeline for more than $1 billion.

Hasbro puts last year's loss in the past

PROVIDENCE, R.I. - Toy producer Hasbro Inc. reported first-quarter earnings Monday of 1 cent per share, a turnaround from a year-earlier loss.

Net income totaled $1.19 million compared with a loss of $262.8 million, or $1.52 a share in the first quarter of 2002. Excluding a charge for an accounting adjustment, the year-earlier loss was 10 cents a share.

Revenue rose more than 2 percent to $461.8 million in January-March from $452.3 million a year earlier.

Market changes mixed for Treasury bills

WASHINGTON - Interest rates on short-term Treasury securities were mixed in Monday's auction.

The Treasury Department sold $15 billion in three-month bills at a discount rate of 1.160 percent, down from 1.165 percent last week. An additional $16 billion was sold in six-month bills at a rate of 1.185 percent, up from 1.175 percent.

In a separate report, the Federal Reserve said Monday that the average yield for one-year constant maturity Treasury bills, the most popular index for making changes in adjustable rate mortgages, rose to 1.33 percent last week from 1.25 percent the previous week.

Maker of Zip products charts sales decline

SAN DIEGO - Iomega Corp. shares fell 18 percent after the maker of computer data-storage devices said it's unable to stem declining sales of its Zip products this year.

The stock dropped $2.11 to $9.39 at 4:03 p.m. in New York Stock Exchange composite trading. Volume of 1.9 million was more than 11 times the three-month daily average. Iomega has fallen 30 percent in the past 12 months.

First-quarter Zip sales declined 49 percent to $73.3 million, Iomega said. Total sales fell by 41 percent to $106.2 million from $178.9 million a year earlier.

Gtech changes plans to build new factory

WEST GREENWICH, R.I. - Gtech Holdings Corp., the world's biggest supplier of online gaming systems and services, said it won't need to build a new manufacturing plant in West Warwick, R.I.

Gtech plans to upgrade its manufacturing plant in West Greenwich, R.I., instead. The company also said that talks to sell its world headquarters campus in West Greenwich to Amgen Inc. have ended. Amgen, the world's biggest biotechnology company, no longer has an interest in buying the campus, Gtech said. Gtech is still committed to a new world headquarters in Providence.

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Business Digest