Business in brief: Potlatch reports improved earnings

Potlatch Corp. reported improved third-quarter earnings Thursday, citing improved log prices and higher harvest levels.

The company reported $41 million in net earnings, or $1.04 per share, compared with net earnings of $25.7 million, or 66 cents per share, during the third quarter of 2006.

Despite a continued slump in the housing market and weak lumber prices, Potlatch continued to generate positive income and cash flow from its wood products segment, mainly because of specialty products, such as cedar siding and decking, said Mike Covey, Potlatch’s chairman, president and chief executive officer.

Increased log sales also helped Potlatch’s bottom line. The company has boosted harvest levels in Idaho and Arkansas and is cutting trees on Wisconsin forestland that it acquired earlier this year.

Covey also said that a weaker U.S. dollar and global demand for pulp created the best global pulp market in approximately a decade. Potlatch sells pulp and uses it in paperboard and tissue production.

NEW YORK

Vonage says it settled patent lawsuit

Vonage Holdings Corp., the beleaguered provider of Internet-based telephone service, said Thursday it has settled a patent lawsuit brought by Verizon Communications Inc. for a maximum of $120 million.

The lawsuit, along with two filed by other phone companies, had cast a heavy shadow over Vonage’s future. The company’s service enables subscribers to connect their phones to their broadband connections for about $25 a month using a Vonage adapter.

After setbacks in the litigation with Verizon, which began in June 2006, Vonage put $88 million in escrow. The settlement caps any payouts Vonage will make on top of that amount at $32 million. If Vonage wins a rehearing on either of the two patents at issue, its total payout will be $80 million.

The settlement was announced just after the 4 p.m. stock market close, which saw Vonage shares fall 7 cents to $1.53. In after-hours trading, the shares jumped 70 percent to $2.60.

PHOENIX

US Airways, Alaska Air post profits

US Airways Group Inc. and Alaska Air Group Inc. said they swung to a third-quarter profit Thursday as the carriers increased revenues and did a better job of filling planes.

Seattle-based Alaska Air, the holding company for Alaska Airlines and Horizon Air, posted net income of $85.8 million, or $2.11 per share, compared with a loss of $17.4 million, or 44 cents per share, a year earlier. Revenue rose 6 percent to $995.1 million in the July-September period, up from $935.7 million in the year-earlier period.

US Airways had net income of $177 million, or $1.87 per share, in the three months ended Sept. 30, after a loss of $78 million, or 88 cents per share, during the same period last year.

But shares for the Tempe, Ariz.-based company dropped as oil prices rose above $90 a barrel.

“Everything is off. All the airlines are off,” said Ray Neidl, an analyst with Calyon Securities.

US Airways shares fell $1.35, or 4.7 percent, to $27.39 Thursday. Its stock has dropped 51 percent since US Airways ended its hostile bid for Delta Air Lines Inc. in January.

From staff and wire reports