Briefly
Strong 4th quarter boosts Key Tronic
Spokane-based Key Tronic Corp. reported Tuesday net income for its fiscal 2005 fourth quarter of $2.8 million, or 28 cents a share, up sharply from income of $265,000, or 3 cents per share, for the fourth quarter of fiscal 2004.
Net income for the full fiscal year was $4.4 million, or 44 cents a share, compared with income of $110,000, or 1 cent a share, the previous year.
Key Tronic also reported a 20 percent increase in fourth-quarter sales and a 36 percent increase in yearly sales compared with fiscal 2004.
“We are pleased with our strong sales growth and improved production efficiencies, which drove increased operating income and earnings in the fourth quarter and throughout fiscal 2005,” Jack Oehlke, Key Tronic’s president and CEO, said in a news release.
Oehlke said the company grew by adding new production for customers wanting hospital equipment, medical technology and consumer electronics.
Hot housing market cools down a bit
Washington Sales of previously owned homes fell in July as some house hunters were put off by galloping prices, but the pace of sales was still the third-highest ever, suggesting the red-hot market isn’t cooling much.
The latest snapshot of activity in the housing market released by the National Association of Realtors on Tuesday showed that July sales of existing homes — including single-family, town homes and condominiums — totaled 7.16 million units at a seasonally adjusted annual rate.
That represented a 2.6 percent decline from June’s record-high pace of 7.35 million units.
Soaring home prices and to a lesser extent rising mortgage rates played a role in July’s drop in sales — making it harder for some house hunters to take the leap into home ownership, analysts said.
Starwood to build property in Vegas
Las Vegas Starwood Hotels & Resorts Worldwide Inc. intends to expand dramatically in Las Vegas, bringing its hip and urban W brand to one of the most competitive and coveted markets in the leisure industry.
Starwood is joining with Edge Resorts, a group of private investors, in a $1.7 billion project that will involve a mix of approximately 3,000 hotel and residential units and a 75,000-square-foot casino, along with 300,000 square feet of meeting space and additional shops. It’s slated to open 2008.
Edge Resorts will control 75 percent of the project. Starwood, which is W’s parent company, will own the remainder and manage the W Las Vegas hotel.
The project will sit on 21 acres located just east of the Las Vegas Strip, next to the popular Hard Rock hotel-casino.
Ex-Kmart executives facing fraud charges
Detroit The Securities and Exchange Commission on Tuesday filed civil charges against two former Kmart executives, accusing them of making “materially false and misleading” disclosures to shareholders before the retailer’s 2002 bankruptcy filing.
The complaint filed in U.S. District Court in Detroit charges former chairman and CEO Charles C. Conaway and former Chief Financial Officer John T. McDonald with securities fraud and aiding and abetting securities fraud. It also accuses them of aiding and abetting violations of rules that require publicly traded companies to file quarterly reports and to include material information in the reports so they are not misleading.
Lawyers for the former executives denied the charges.
FDA sends warning to Boston Scientific
Boston Federal regulators sent Boston Scientific Corp. a warning letter identifying “serious regulatory problems” in medical devices shipped from a Quincy, Mass., distribution plant, including heart stents sent to hospitals despite a quality control problem.
The Food and Drug Administration’s disclosure of the letter on Tuesday sent shares of Boston Scientific down nearly 5 percent to a new 52-week low at $25.92 on the New York Stock Exchange.
A letter to the company dated Aug. 10 said FDA inspectors found “serious regulatory problems” during a nearly two-month inspection in Quincy that ended May 20. The letter cited problems in shipments of the Natick, Mass.-based company’s Taxus drug-coated stents — Boston Scientific’s top-selling product — as well as Vaxcel implantable infusion ports used to administer drugs and Symmetry catheters that insert medical devices.
Boston Scientific spokesman Charles Rudnick said the company “is actively working on every point raised in the FDA letter. We’ve completed corrective action in many areas.”
GE, Rolls-Royce land military jet contract
Evandale, Ohio A joint venture between General Electric Co. and Rolls-Royce PLC has won a $2.47 billion contract to develop an engine for the military’s next-generation stealth jet fighter.
The contract is the largest military developmental contract in about 20 years for Fairfield, Conn.-based GE’s jet-engine division, GE Aircraft Engines, which is based in this Cincinnati suburb and employs about 6,800.
GE was named the majority partner in a 60-40 joint venture with British engine-maker Rolls-Royce. The deal is for the Lockheed Martin F-35, known as the Joint Strike Fighter.
Airline and caterer agree to new contract
London British Airways PLC and the U.S. company that provides its in-flight meals agreed Tuesday to a new deal, delaying the catering company from filing for bankruptcy. But talks between the caterer and a union, on which the deal hinged, hit a stumbling block.
Gate Gourmet, which prompted the cancellation of hundreds of BA flights earlier this month when the airline’s ground staff joined a strike by the caterer’s workers, had set a deadline Tuesday to reach an improved commercial deal with BA or face a bankruptcy filing.
That deadline passed, but later Tuesday the airline and the caterer, which provides 80,000 in-flight meals to BA each day, confirmed they had agreed to terms of a new deal. As a result, Gate Gourmet said it had deferred its decision to enter into administration.