Business Digest


May 07, 2004

In The Region

Credit counselor yet to appeal denial of license

AmeriDebt, one of the nation's largest credit-counseling agencies, has not appealed the state's decision to deny it a license to do business with Marylanders, a regulator said yesterday.

Joseph E. Rooney, Maryland's deputy commissioner of financial regulation, said he intends to meet with AmeriDebt officials to develop a plan for the counseling agency to turn over its 5,000 to 6,000 Maryland clients to a licensed agency.

Last month, the state denied AmeriDebt's application for a license because of its weak financial condition. The Germantown nonprofit is the target of lawsuits by several other states that also threaten its financial stability, regulators said. AmeriDebt had 30 days to appeal.

AmeriDebt lawyer Zynda Sellers would not comment yesterday on the nonprofit's license application or plans to turn over its Maryland customers to another agency.

AIG seeking to void US Foodservice policy

Royal Ahold NV, the Dutch supermarket operator that overstated profit for three years because of accounting problems, said yesterday that American International Group Inc. is trying to void a $100 million policy covering lawsuits against directors and officers at its US Foodservice subsidiary, the Columbia-based unit where most of the earnings inflation occurred.

AIG Europe NV, a unit of the world's biggest insurer, claims some statements made by Ahold and US Foodservice when the policy was issued weren't true, according to the grocer's annual report, posted yesterday on its Web site. The insurer has summoned the food retailer, which also owns Landover-based Giant Food, to appear in court, the report said.

Ahold, which bought the policy in 2000 when it acquired US Foodservice, has said it holds James Miller, the unit's chief executive until last year, and two other former managers responsible for damages relating to fraud at the unit. The Dutch company last year admitted overstating profit by 970 million euros ($1.2 billion) over three years, mostly because of accounting errors at the food distributor.

The company plans to "vigorously contest AIG Europe's claim and enforce its rights" under the policy, the report said.

Rite Aid's ex-counsel loses post-trial motions

A former Rite Aid Corp. executive convicted of 10 criminal offenses lost his bid yesterday for acquittal on five counts as well as his request for a new trial on the other charges.

U.S. District Judge Sylvia H. Rambo, in Harrisburg, Pa., denied all post-trial motions by Franklin C. Brown, the pharmacy chain's former chief counsel and board vice chairman. Brown, 76, was convicted in October of conspiracy, obstruction, witness tampering and making false statements to the Securities and Exchange Commission.

Sinclair Broadcast Group narrows first-quarter loss

Sinclair Broadcast Group Inc., yesterday posted a net loss of $2.3 million for the first quarter, which ended March 31, compared with a loss of $3.9 million a year earlier.

The Baltimore company reported net broadcast revenue of $158.3 million, a 3.8 percent increase from $152.5 million the year before. Its operating income was $30.4 million, up slightly from $30 million a year earlier.

Strong automotive and political advertising toward the end of the quarter helped Sinclair perform better than it had anticipated, the company said.

Sales increase 13.5% at Jos. A. Bank Clothiers

Jos. A. Bank Clothiers Inc. said yesterday that its sales in the month that ended May 1 increased 13.5 percent, to $26 million, from $22.9 million a year earlier.

Comparable-store sales increased 2.7 percent from last year, and catalog and Internet sales jumped 6.9 percent.

The Hampstead company also said it expects its diluted earnings per share for the first quarter to be at least 40 cents, double what it posted a year ago. Total first-quarter sales increased 28.3 percent, to $79.9 million, from $62.3 million last year.

Aether posts 1Q loss of 16 cents per share

Aether Systems Inc. reported a first-quarter loss of $6.8 million, or 16 cents per share, for the period that ended March 31. The Owings Mills-based wireless data technology company reported a loss of $7.1 million, or 17 cents per share, a year earlier.

Aether also reported revenue of $12.5 million for the quarter, a drop from its revenue of $14.9 million a year ago.

United Therapeutics pares first-quarter loss

United Therapeutics Corp., announced yesterday a net loss of $1.8 million, or 9 cents per share, in its fiscal first quarter, which ended March 31. That was a 39 percent improvement from the net loss of $3 million, or 14 cents per share, reported for last year's first quarter.

Revenue in this year's quarter was $13.7 million for the Silver Spring-based biotechnology firm, up 27 percent from revenue of $10.7 million recorded for the 2003 quarter. That increase was largely because of expanded sales of Remodulin, a drug used to treat pulmonary arterial hypertension, United Therapeutics said.

Castleman is named state marketing officer

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