Terremark Worldwide said on Thursday that revenue for the fourth quarter rose 11 percent to $82.5 million, up from $74.2 million in the prior three-month period.
The Miami-based provider of IT infrastructure services (NASDAQ:TMRK) reported revenue for the fiscal year ended March 31 was $292.3 million, a 17 percent increase over the prior fiscal year.
The company reported a net loss of $1.2 million, or 2 cents a share, improved from a loss of $8.3 million or 13 cents a share in the previous quarter, but down from the same time last year when it earned $4.1 million, or 6 cents a share.
Terremark said it added 56 customers in the fourth quarter, bringing its total number to 1,350.
“With another very strong quarter and fiscal year, Terremark continues to produce the positive results that reflect the strong demand among federal and enterprise customers for our suite of industry-leading solutions across our global footprint and our proven ability to successfully execute our strategic plan,” said Manuel D. Medina, Chairman and CEO of Terremark, in a news release. “Our consecutive quarters of record bookings, robust pipeline and strategic expansion create a solid base for fiscal 2011 and a clear path for sustained growth.”
Last week, Terremark said it acquired 27 acres of land adjacent to its Network Access Point (NAP) of the Capital Region for $5 million. The company also recently opened a 72,000-square-foot headquarters building at the NAP of the Capital Region campus.
The company said it expects revenues in the first quarter to range from $77 million to $79 million. For the full fiscal year, the company raised its guidance of revenue to range from $338 million to $343 million.
Shares closed up 32 cents to $7.50 on Thursday. The 52-week high was $8.98 on Jan. 21. The 52-week low was $4.34 on July 10.
The Federal Reserve has a more optimistic outlook for the U.S. economy, according to meeting minutes released Wednesday, but the central bank is still debating how to shrink its massive balance sheet.
The Fed now expects U.S. gross domestic product, the broadest measure of economic activity, to increase at an annual rate of between 3.2% and 3.7% in 2010. That’s up from the Fed’s previous estimate of between 2.8% and 3.5% in January.
GDP rose at a 3.2% annual rate in the first three months of this year, the government said last month.
At the same time, the Fed reduced its forecast for the nation’s unemployment rate to a range between 9.1% and 9.5% this year, versus 9.5% to 9.7% in January. The unemployment rate currently stands at 9.9%.
The minutes were from the Fed’s most recent Open Market Committee meeting, which took place last month. That meeting happened before the financial markets were rocked by an escalation of fears about the economic crisis in Europe.
Still, Fed members also acknowledged the growing turmoil in Europe leading up to its last meeting, noting that "fiscal strains in Greece intensified during the intermeeting period."
The Fed subsequently announced plans to expand currency swaps with the European Central Bank and other central banks in the region to help contain the crisis.
When will the Fed raise rates? Despite the improved outlook, the Fed cautioned that the U.S. economy remains vulnerable enough to maintain an "accommodative stance of monetary policy."
In addition, committee members discussed ways to reduce the central bank’s balance sheet, which swelled during the financial crisis as the Fed bought billions worth of government and corporate bonds.
In March, the Fed completed a $1.25 trillion program to buy mortgage bonds backed by government-sponsored lenders. It also purchased about $175 billion of agency debt.
Last year, the Fed bought $300 billion of long-term U faxless payday loans.S. Treasury bonds to help keep mortgage rates down.
"Meeting participants agreed broadly on key objectives of a longer-run strategy for asset sales and redemptions," according to the minutes. "Reducing the size of the balance sheet would decrease the associated reserve balances to amounts consistent with more normal operations of money markets and monetary policy."
But the minutes showed that Fed bankers had a variety of opinions on how and when to begin selling the securities. Most members wanted to delay asset sales "for some time," but a few members preferred to begin sales "relatively soon."
A majority of members were in favor of selling assets gradually over a period of five years — but not until after the Fed begins increasing interest rates since that would mean the economic recovery is firmly established.
If that’s the case, the Fed may not wind up selling any of these assets anytime soon. The Fed also lowered its outlook for inflation, suggesting the central bank will be able to maintain the low interest rate policy it has had in place for over two years.
In April, the FOMC voted to hold the federal funds rate, its key overnight lending rate, near 0%. At that time, the Fed said it expects to keep rates "exceptionally low" for an "extended period" — which has been the central bank’s mantra for months.
However, one member of the committee voted against holding rates low indefinitely.
Thomas Hoenig, president of the Federal Reserve Bank of Kansas City, indicated that rates should be increased toward 1% this summer, at which time the Fed could "further assess the economic outlook," according to the minutes.
Amid growing concerns about deficits, Congress will in coming weeks consider a bevy of measures that combined could increase the deficit by close to $500 billion over 10 years.
And that doesn’t include the big kahuna on this year’s agenda: extending the 2001 and 2003 tax cuts, which could cost anywhere from several hundred billion dollars to more than $2 trillion.
While it is expected that many measures will be paid for with revenue-generating provisions, the total cost of all that’s on the table would not be fully offset. That’s in large part because several measures are exempt from the new "pay-as-you-go" law.
Some of the measures have already been factored into 10-year deficit projections. But in a rough mid-term election year that has seen the eruption of a debt crisis in Europe, lawmakers on both sides of the aisle are becoming more sensitive to the optics of passing measures that are not paid for, even when many consider those measures essential.
The specific contents of the major bills under consideration are still being shuffled about. But several of the measures below are likely to make the cut in one form or another.
Extension of tax breaks: Dozens of tax breaks for businesses and individuals have lapsed. The cost of extending them for this year is $31 billion.
Such "tax extenders" include the research and development credit for businesses and the choice for individuals to deduct either their state and local income tax or their state and local sales tax.
Estate tax: Defying all expectations, Congress let the estate tax die at the end of 2009. But it’s coming back in 2011. The question is at what level.
Unless Congress acts, starting next year no more than $1 million of a person’s estate would be exempt from the estate tax — which is well below the $3.5 million exemption in place last year. And the top estate tax rate would revert to 55%, up from 45% in effect last year.
President Obama has proposed permanently extending the estate tax at 2009 levels, which the Tax Policy Center estimates would cost $234 billion over 10 years.
In the Senate, however, a proposal to exempt $5 million and set the top rate at 35% has garnered some bipartisan support. Depending on how various parameters are set, the proposal could cost north of $300 billion.
Safety-net provisions for the unemployed: Some lawmakers are pushing to retain a program that extends the number of weeks an unemployed person may collect federal unemployment benefits. When combined with state benefits, under the program, that means a person can qualify for up to 99 weeks of benefits.
But the program expires in June. The measure under consideration would extend it to the end of the year.
Likewise, there’s a proposal to extend the federal subsidy to help the newly unemployed pay for health insurance under COBRA. The subsidy is scheduled to expire at the end of May, so anyone who loses their job in June would not be eligible.
Combined, the two measures would cost close to $90 billion.
Aid to states: A proposal under consideration would provide $25 billion in federal aid to help budget-strapped states meet the increased demands for Medicaid services.
Funding for education jobs: Sen. Tom Harkin, D-Iowa, has proposed that $23 billion be appropriated to prevent states, suffering from steep budget deficits, from having to lay off teachers, principals, librarians and other school personnel.
War spending: Lawmakers are considering a request for $33 billion in supplemental war spending in Iraq and Afghanistan. It is expected to be included in a bill with other supplemental spending requests — such as for disaster relief. All told, the supplemental spending requests would total $59 billion.
‘Doc fix’: Unless Congress acts, Medicare reimbursement rates for physicians will automatically be cut 21% come June 1 and by 1% to 6% in future years because of a pre-set formula that dictates Medicare outlays related reimbursements. Lawmakers are likely to override that scheduled cut for five years, at a cost of $89 billion.
Small business tax relief: President Obama has proposed excluding capital gains tax on small business stock purchased by individuals. So the tax break — estimated to cost $2 billion over 10 years — would help "angel" investors who take early stakes in fledgling, privately held companies.
2001/2003 tax cuts extension: There’s been bipartisan support for extending the 2001 and 2003 tax cuts for the majority of Americans. If Congress doesn’t act, they will expire after Dec. 31.
Extending them permanently would cost an estimated $2.2 trillion over 10 years.
It’s not clear yet how long lawmakers might opt to extend the tax cuts, or if there will be enough of a push to also extend them for high-income households. Both parties have favored making the cuts permanent, at least for most Americans. But of late some believe extending them for a year or two may be the smartest move given current political and economic constraints.
Indeed, last week conservative economist Martin Feldstein, who was President Reagan’s top economic adviser, said in a Wall Street Journal editorial that while he favors temporarily extending the cuts for everyone, the country can’t afford to make them permanent.
"Changing the Obama budget proposal to limit all tax cuts to two years would reduce the total deficits over the next decade by more than $2 trillion. No single policy change could do as much to limit the future deficits and the national debt," Feldstein wrote.
WASHINGTON — After nearly a quarter-century of selling pickup trucks and cars in North Dakota, Donovan Berscht had to shut one of his dealerships last year as Chrysler downsized. Now he is worried that a second financial jolt — this time the push for toughened economic oversight in Washington — could batter his remaining Chevrolet-Buick dealership.
If President Barack Obama has his way, loans at auto dealers would be put under the purview of a new federal consumer protection authority to guard against fraud and abuse. The prospect of increased regulations, Berscht said, “could force us out of the financing business,” and it has him so concerned that he traveled to Washington last month to ask Sen. Kent Conrad, a Democrat and one of his senators, for quick relief.
The financial reforms being debated in the Senate have prompted resistance from a variety of businesses, but perhaps nowhere more intensely than in the already beleaguered auto industry, where dealers find themselves pitted against Obama in their aggressive campaign to exempt themselves from the new rules.
For some 18,000 auto dealers in the United States, who historically have made up a potent political force, the debate presents a critical test of their continued influence in Washington, as they push lawmakers to help them hold on to revenue.
Through their lobbying arm, the National Automobile Dealers Association, the dealers have hired a crisis communication team, taken out full-page newspaper advertisements, and organized trips to Washington for dealers like Berscht to buttonhole lawmakers and make their case.
Their basic message, like those of many other industries threatened by tighter regulation, is that they did not cause the financial crisis, and they should not be penalized for it through a burdensome and costly new regulatory structure.
A vote on the proposed exemption for the auto dealers could come this week on the Senate floor, with neither side predicting victory.
For Obama, the issue is his latest attempt to push through broad legislative changes in Congress partly by singling out powerful players in the private sector.
In his successful campaign for a health care overhaul this year, Obama went after the nation’s major insurance carriers repeatedly as a symbol of why the health system needed to be fixed.
To try to restructure the country’s federal student loan program, Obama portrayed big providers of student loans like Sallie Mae as profiting from a “sweetheart deal” at the expense of struggling students. As in the health care overhaul, he won that debate in Congress, too.
And from the start of the current push for toughened financial regulations, he has cast the fight as an attempt to rein in the big banks on Wall Street, whose “reckless practices” he blames in large part for the economic downturn.
Last week, as the debate over financial regulation neared an end in the Senate, Obama identified a new target in a formal statement: The “auto dealer-lenders” seeking a “special loophole” in the legislation through an amendment pushed by Sen. Sam Brownback, R-Kan.
“This amendment would carve out a special exemption for these lenders that would allow them to inflate rates, insert hidden fees into the fine print of paperwork, and include expensive add-ons that catch purchasers by surprise,” Obama said. The proposal, he warned, “guts” the bill and encourages “misleading sales tactics.”
The administration also linked the auto dealers exemption to the exploitation of military personnel. Officials released a Pentagon letter saying that many service members, according to an informal military survey, had fallen victim to “bait and switch” tactics and other predatory practices that left them with loans they struggled to pay.
Obama’s condemnation of unfair auto loans was the first time he has weighed in with a formal White House statement on a specific amendment of the sweeping financial regulation, and it caught many dealers and industry executives off guard.
Some dealers brand the White House’s account of auto loan irregularities as “pure fiction,” saying it mischaracterizes the process by which dealers facilitate or package auto loan requests for lending companies. Moreover, they say Obama has unfairly vilified their industry.
“The way the White House is portraying us as evil, it’s just wrong,” said Michelle Primm, the general manager of a family-run import dealership, Cascade Auto Group, about 35 miles south of Cleveland.
Primm made two trips to Washington last month to speak with both of her senators and Congressional staff members about the potential harm from the auto loan provision.
She and other dealers say they are already heavily regulated, mainly at the state level, through regulations that prohibit the loan abuses cited by Obama. They said the new federal regulations would only add costs to the way they arrange loans to buyers for big lending companies like GMAC.
But the administration maintains that the new rules are needed.
An administration official said on Sunday that dealers played a critical and profitable role in arranging the loan rates for many auto buyers, often at a higher rate than they qualified for. The White House also cited industry data showing that dealers made 52 percent of their profits in 2008 from financing and insurance, more than they made on the actual car sales.
The outcome may hinge more on influence than dueling data. On that front, the auto dealers have already proven formidable.
The auto dealers’ association spent $3 million last year on federal lobbying as part of a broader effort by the auto industry as a whole. Auto dealers, their employees and political action committees made political contributions of more than $9.3 million in the 2008 election cycle, most of it to Republicans, according to the Center for Responsive Politics, a nonprofit research group.
Perhaps more important than the auto dealers’ money is their deep presence in local communities, which can have a powerful impact on the lawmakers whose communities they represent, political analysts and lawmakers said.
Brian Hart, a spokesman for Brownback, said the dealers’ strong community ties had given them in-person access to many politicians to plead their case.
“Every member was very receptive to talking to their local dealers,” he said, “because they’re truly Main Street. People drive by them every day and know who they are.”
The auto dealers already demonstrated their political muscle on the issue in October, when the House passed its version of the financial overhaul but exempted the dealers from the consumer protection provisions. The exemption was pushed by Rep. John Campbell, a California Republican who is a former car dealer, and it came over the objections of Democratic leaders.
Berscht, the North Dakota dealer, is hoping for a quick resolution.
“I’m not a political guru by any means,” he said, “but there’s a real urgency to get this amendment in there on this major bill and to provide some relief for the auto dealers.”
Christopher Brassard, executive vice-president and director of Albany-based Ten Eyck Group, has been named chair-elect of the Independent Insurance Agents & Brokers of New York.
Brassard has served on the IIABNY board of directors since 2004, most recently as secretary-treasurer. He has also served on the Public Policy, Industry Practices & Producer Compensation, and Audit committees.
Brassard started his career with the Aetna Life & Casualty Insurance Co. and joined the Ten Eyck Group in 1988. He is a 1982 graduate of the state University at Albany School of Business and holds the Certified Insurance Counselor (CIC) designation.
IIABNY, which is based in DeWitt, N.Y., represented more than 1,900 insurance agencies in the state.
Goldman Sachs brought its campaign to improve its image directly to investors Friday as Chairman and CEO Lloyd Blankfein said the investment bank will do better at "listening to the concerns of our shareholders."
Blankfein also told the company’s annual meeting that Goldman is creating a business standards committee to study its practices as it fights civil fraud charges brought by the Securities and Exchange Commission.
"We need a rigorous self-examination," Blankfein told investors at the meeting, which attracted about 300 people. "Our firm must review our core principles."
The committee, which will report to the Goldman board of directors, will review both services and products Goldman offers, Blankfein said.
Blankfein, who has responded to the SEC charges by saying Goldman has done nothing wrong, offered a softer side Friday. He pledged that the company will be more introspective and listen to issues raised by shareholders quick pay day loan.
Blankfein noted there is a "disconnect" between how the company views itself and how outsiders see Goldman Sachs Group Inc. Blankfein noted that in the last few weeks, questions have been raised about how "we treat our clients."
Regaining the confidence of clients and shareholders is essential, he said.
In the past, Goldman has focused on its big institutional clients and not enough on the public, he said. The company has come under sharp criticism before and after the SEC charges were filed April 16, partly because of the high pay its executives and traders received during the financial crisis and recession.
Higher demand and cost reductions triggered a sharp rise in net income in the first quarter at Astronics Corp., the East Aurora manufacturer said Wednesday.
Profits rose 142.7 percent to $3.4 million, or 31 cents per share, up from $1.4 million, or 13 cents per share, in the 2009 first quarter.
Sales in the 2010 first quarter were down 6.2 percent to $46.9 million from $50 million a year ago. The company noted the figure for Astronics’ DME subsidiary was for the entire period while the 2009 first quarter included DME sales for a nine week period. Astronics acquired DME on Jan. 30, 2009.
“Demand was higher than expected, especially for our in-seat power products, and our aggressive cost cutting over the last year drove solid margins,” said Peter Gundermann, president and CEO.
Astronics (NASDAQ: ATRO) produces lighting, electrical power and automated test systems for the areospace and defense industries.
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