Business briefs 9/3/04

Retailers disappointed in back-to-school sales

NEW YORK -- The August start of the back-to-school shopping season was a disappointment for major retailers, delivering the industry a third straight month of tepid sales and its weakest gain in almost a year and a half. The discouraging news came from nearly all retail sectors.

Oil companies influencing Calif. governor's plan

SACRAMENTO, Calif. -- Gov. Arnold Schwarzenegger's ambitious plan to reorganize almost every aspect of state government was influenced significantly by oil giant ChevronTexaco Corp., which managed to shape such key recommendations as the removal of restrictions on oil refineries. State records and interviews with the participants show Chevron enjoyed immense success in influencing the report through its array of lobbyists, attorneys and trade organizations.

Continental to cut work force by 1 percent

HOUSTON -- Continental Airlines Inc. said Thursday it would cut about 425 jobs, or 1 percent of its work force, through staff reductions, attrition and elimination of unfilled vacancies as part of an effort to trim expenses by another $200 million. Most of the job cuts are in the management and clerical ranks.

Economy still slogging through rough patch

WASHINGTON -- Worker productivity growth slowed in the second quarter, retailers saw tepid sales in August and new claims for unemployment benefits rose last week, according to a trio of reports that suggested the economy was still working through its rough patch. -- From wire reports

Intel reflects economic doldrums in its projections

SAN FRANCISCO -- High-tech bellwether Intel Corp. lowered its financial projections Thursday, providing the latest sign of the economy's doldrums. The Santa Clara-based computer giant said its third-quarter revenue will range from $8.3 billion to $8.6 billion. Management previously forecast revenue ranging from $8.6 billion to $9.2 billion for the three-month period ending Sept. 25.

The mean revenue estimate among industry analysts had been $8.9 billion, according to Thomson First Call.

Intel isn't living up to expectations because the global economy appears to be losing steam, said Andy Bryant, Intel's chief financial officer.

Russian oil producer battles back taxes

MOSCOW -- Russia's largest oil producer, ensnared in a debilitating battle over a huge back taxes bill, said Thursday it is unable to pay wages and that production is in imminent danger of stopping. The statement by the Yukos oil company followed a court decision Tuesday that froze accounts in its subsidiary companies. Analysts doubted, however, that President Vladimir Putin would allow a fall in crude output in an industry that accounts for much of Russia's budget intake and has spurred the country's recent economic growth.

Internal Halliburton probe uncovers bribery scandal

HOUSTON -- Halliburton says an internal investigation has found that a consortium it later took over had once considered bribing Nigerian officials to win an energy contract.

Documents found during the investigation of the $180 million bribery scandal suggested the payments were discussed at least 10 years ago, before Halliburton took the lead of the multinational business group TSKJ.

The probe has not found evidence confirming that any such payments were ever made, Halliburton said in a news release posted on its Web site Wednesday.

CINCINNATI (AP) -- A tax credit that Ohio granted DaimlerChrysler AG to build a Jeep plant is unconstitutional because it grants preferential treatment to companies to expand within the state rather than elsewhere, a federal appeals court ruled Thursday.

The ruling by the 6th U.S. Circuit Court of Appeals could be cited to challenge similar tax-break programs used by other states to promote economic development, said a lawyer who argued against Ohio's program.

Some 35 of the 45 states with a corporate income tax had some type of investment tax credits, according to a 1996 report by the state of New York, said National Taxpayers Union spokesman Pete Sepp. He said the appellate court's ruling could hamper many states in their competition to use tax breaks to lure corporate investment.

TORONTO (AP) -- Nortel Networks is delaying its restatement of 2003 earnings by another month -- until October.

The high-tech company, which announced two weeks ago it was cutting 3,500 more employees and firing seven more finance executives in an accounting scandal, had previously said it planned to file statements for 2003 and the first two quarters of 2004 by the end of September.

Nortel fired CEO Frank Dunn in April, along with its chief financial officer and controller, and said its stated profit of $732 million for 2003 would be cut in half.

In addition, the company faces shareholder lawsuits and the Royal Canadian Mounted Police is conducting a criminal investigation into its accounting.