In the Region After strong sales, Ahold sticks with...

BUSINESS DIGEST

October 06, 2001

In the Region

After strong sales, Ahold sticks with forecast for year

Royal Ahold NV, the No. 1 food distributor, will stick with its full-year profit forecast as rising store sales offset a slowdown in food-service revenue after the U.S. terrorist attacks, Chief Executive Cees van der Hoeven said yesterday.

The Dutch owner of the Giant Food Inc. and Stop & Shop grocery chains in the United States has expanded through acquisitions and is focusing on the business of supplying food to restaurants and hotels, which has been growing faster than supermarkets.

Ahold expects earnings per share before good will and currency changes to gain 15 percent. Van der Hoeven said he also feels positive for the longer term because Ahold was cutting costs and preparing for slower growth before the attacks in New York and Washington.

Md. jobless rate up slightly in August, to 3.9%

Maryland's unemployment rate rose slightly in August, to 3.9 percent from 3.8 percent in July, but remained a percentage point below the national rate, state officials said yesterday.

The rise in the unemployment rate was expected because of the end-of-summer employment cutbacks in restaurants, hotels and entertainment industries, officials said. In August 2000, the rate also was 3.9 percent.

Unemployment rates were lowest at 2.3 percent in Montgomery County, followed by 2.5 percent in Carroll and Talbot counties. They topped out at 8.7 percent in Dorchester County, followed by 7.9 percent in Baltimore City and 6.4 percent in Allegany County.

Gardiners plans to open 2 more stores in state

Gardiners Furniture is opening two new stores, one later this month near Westminster and a second in March north of Annapolis.

The first, to open in a 42,000-square-foot building on Route 140 by Oct. 18, will replace the former Westminster store on Railroad Avenue, which has closed. The second, to be the chain's largest at 62,000 square feet, will open on Ritchie Highway in the Pasadena Crossroads shopping center in a former Burlington Coat Factory.

The chain also has stores in Towson, Catonsville and Bel Air.

Elsewhere

Xerox replaces accounting firm after critical review

Xerox Corp. yesterday replaced its accounting firm, which had found fault with management after investigating the finances of the struggling copier and printer company.

Xerox said PricewaterhouseCoopers LLP will replace KPMG LLP as its independent accountants Dec. 31. KPMG had worked with Xerox for 30 years.

KPMG said in documents Xerox filed with the Securities and Exchange Commission yesterday that its review found evidence that Xerox management "was not successful in setting the appropriate tone with respect to financial reporting." Xerox Chairman Paul A. Allaire did not refer to KPMG's criticism as he announced the change.

Frontier Airlines to rehire 70 maintenance workers

Frontier Airlines will rehire about 70 maintenance workers it laid off after the Sept. 11 attacks on the World Trade Center and the Pentagon, the carrier said yesterday.

The move comes as Frontier, which laid off 440 people because of a drop in air travel since the attacks, adds a fourth daily flight to Dallas, Kansas City and San Francisco from its Denver hub. Frontier said it added the flights because passengers afraid to fly after the hijackings were gradually coming back.

"These markets were strong performers prior to the events of Sept. 11, and we are pleased that consumer confidence appears to be in the early stages of rebounding," Frontier President and Chief Operating Officer Jeff Potter said. He added that the airline hopes to bring back more laid-off employees. Frontier serves 25 cities and has 2,300 workers.

Consumer credit increased at 1.7% rate in August

Americans stepped up their borrowing in August, as tax rebate checks added money to their pockets. But analysts predicted that consumers, shaken by the Sept. 11 attacks, will be more tightfisted in the coming months.

Consumer credit rose by a seasonally adjusted $2.3 billion in August, or a 1.7 percent annual rate, the Federal Reserve reported yesterday, saying Americans used their credit cards more freely in August than in July and took out more loans to finance a variety of big-ticket items, including new cars and vacations.

Before the Sept. 11 attacks on the World Trade Center and the Pentagon, consumers - whose spending accounts for two-thirds of all economic activity - were the main force keeping the economy out of recession. Economists hope that tax rebate checks will encourage consumers to keep spending. The bulk of the checks were mailed out in August and last month.

Freightliner union workers OK pay, benefit reductions

Freightliner's union workers have voted to accept reductions in pay and benefits, concessions they hope will help keep the company in Portland, Ore.

About 3,000 people work at Freightliner's headquarters, heavy truck manufacturing plant and a parts plant in the city. The company also operates plants in North Carolina, Mexico and Canada.

Four craft unions representing nearly 1,200 machinists, painters, Teamsters and janitors at the Portland plants voted 762-227 on Thursday to accept the rollbacks, said Steve Hillesland, representative for the International Association of Machinists and Aerospace Workers, District Lodge 94.

Reno hotel-casino sold for an undisclosed sum

Park Place Entertainment Corp. has sold the Flamingo Reno hotel-casino in Reno, Nev., to RFC Reno LLC, a subsidiary of Capital One LLC of Las Vegas, for an undisclosed sum.

Park Place said the property will close Oct. 23 for redevelopment.

This column was compiled from reports by Sun staff writers, the Associated Press, Bloomberg News and Reuters.

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