Sprint replaces auditor, reduces exec severance
Wednesday, October 15, 2003
KANSAS CITY, Mo. -- Sprint Corp. has replaced longtime auditor Ernst & Young, which came under fire from some shareholders because of tax shelter recommendations it made to Sprint's top two executives on how to deal with their stock options.
Sprint announced Tuesday that the audit committee of its board of directors chose KPMG as auditor for fiscal 2004. Ernst & Young will complete the 2003 audit.
The Overland Park, Kan.-based company also said it would cap executives' severance packages at two times their base salaries and bonuses in the event another company bought Sprint. The policy was adopted in response to another shareholder vote.
Ernst & Young has been the auditor for Sprint and its predecessor since 1965, and never before has had competition to keep the assignment. But at Sprint's annual meeting in May, 38 percent of shareholders, an unusually high percentage, voted against reappointment of Ernst & Young.
Strong computer demand increases Intel profits
SAN JOSE, Calif. -- Intel Corp.'s third-quarter profits more than doubled Tuesday as the world's largest semiconductor company benefited from the strongest demand for personal computers since the high-tech boom of the late 1990s.
For the first time in the economic recovery, Intel executives said the company's growth was outpacing normal seasonal patterns.
For the three months ended Sept. 30, Intel earned $1.7 billion, or 25 cents per share, compared with profits of $686 million, or 10 cents per share, in the same period last year. Sales rose 20 percent to $7.8 billion, from $6.5 billion last year.
AOL readies discount version of online service
Trying to fend off cut-rate competitors, America Online plans to introduce a discount version of its dial-up Internet access service early next year that will carry the Netscape brand name, a person with the company said Tuesday.
The new service is expected to cost $9.95 per month for unlimited access, a big break on the $23.90 monthly tag that comes with AOL's current dial-up service, which has seen its subscriber numbers fall. The new plan would also beat the $14.95-per-month package AOL is pushing to people who get their Internet access from a separate broadband provider.
However, executives at Dulles, Va.-based AOL, part of AOL Time Warner Inc., don't believe the new Netscape discount service will siphon away bigger-spending customers after it debuts nationwide in the first quarter of 2004.
Futures exchange sues Chicago Board of Trade
CHICAGO -- The new U.S. subsidiary of the all-electronic Eurex futures exchange sued the Chicago Board of Trade and the Chicago Mercantile Exchange on Tuesday, accusing them of trying to illegally block it from the market.
The lawsuit reflects the intense jockeying for competitive position as the German-Swiss Eurex, the world's largest derivatives exchange, prepares to take on the venerable Chicago exchanges on their own turf starting in February.
U.S. Futures Exchange LLC said it alleged in the antitrust action, filed in the U.S. District Court for the District of Columbia, that the Merc and Board of Trade offered financial inducements of more than $100 million to shareholders of The Clearing Corp. to vote against a proposed restructuring of the company.
The Merc issued a statement calling the suit "absolutely without factual or legal foundation."
Bank of America sees 30 percent rise in profits
CHARLOTTE, N.C. -- Bank of America Corp. said Tuesday that its profits rose more than 30 percent in the third quarter, driven by across-the-board gains in the bank's major businesses.
Net income totaled $2.92 billion, or $1.92 per share, in the July-September period, up from $2.24 billion, or $1.45 per share, in the third quarter of 2002.
The gains exceeded Wall Street's expectations. Analysts surveyed by Thomson First Call projected the bank's profit at $1.69 a share.
Shares of Bank of America rose 76 cents to close at $82.50 on the New York Stock Exchange.
During the quarter, the Charlotte, N.C.-based bank put $100 million in reserve to fund the ongoing investigation of its Nations Funds mutual fund business. The bank said it also increased its litigation reserve by $75 million to cover other cases.
-- From wire reports