French luxury powerhouse LVMH Moet Hennessy Louis Vuitton said Tuesday that its revenue grew strongly in the third quarter after a the purchase of jewelry giant Bulgari and a rebound in Japan.
The company behind Dom Perignon champagne and Marc Jacobs said sales rose to euro6.01 billion ($8.28 billion), up 19 percent from the previous quarter.
The biggest jump was in the jewelry and watches division, which doubled its sales from last quarter to euro636 million.
The overall sales were up 17 percent from the same quarter a year earlier payday loans.
The quarter also benefited from strong sales in Hong Kong and Macau and a return to luxury consumption in Japan after its devastating earthquake and tsunami.
LVMH said it was confident that sales would remain strong for the rest of the year.
A New York businessman called a “mini-Madoff” because he was arrested weeks after the billion-dollar swindler was sentenced Friday to 25 years in prison and ordered to pay $179 million in restitution _ money he doesn’t have.
Nicholas Cosmo, who apologized as he was sentenced, has had a gambling problem since high school, his lawyer said. He was arrested in January 2009 and pleaded guilty last year to mail and wire fraud.
“I’m going to be working until they put me in the grave,” said one of the victims, Ellen Gabriel, of Yaphank, N.Y., who did not address the court but wept throughout the hearing. The hairdresser said she lost $130,000 _ “my entire life savings.”
Gabriel added that she had researched before investing: “It’s not like we were stupid.”
Four victims did address the court.
“Everything that these people said about me, for the most part, is true,” said Cosmo, the former head of the Long Island-based Agape World and Agape Merchant Advance in New York City.
Agape solicited investors to fund short loans to help companies get temporary financing. Cosmo promised up to 80 percent returns but admitted using investors’ money for personal investments.
“It wasn’t my intention to ever hurt anyone. But I hurt them and I stand here as a guilty man,” Cosmo told the court. “I am truly sorry from the bottom of my heart. I know that probably falls on deaf ears. There’s not a day that goes by that I am not ashamed for what I have done.”
Unlike the more notorious Bernard Madoff, who admitted cheating charities, celebrities and institutional investors out of billions, Cosmo targeted mainly blue-collar workers.
“He preyed on people’s personal relationships and trust,” said Assistant U.S. Attorney Demetri Jones, who had urged a 40-year term. “The victims are everyman _ generations of families.”
The more than 4,000 victims include teachers, police officers, firefighters, nurses and construction workers, Jones said. “They’re not banks. They’re not corporations. They’re people.”
Investors believed they would make returns as high as 80 percent a year from interest collected on short-term loans to businesses. But an investigation revealed that “much of the money paid back to investors … was actually money provided by subsequent investors” _ a Ponzi scheme.
Cosmo also spent 21 months in federal prison for a 1999 mail fraud conviction.
He had been free on $1.25 million bail until October 2009, when U.S. District Judge Denis Hurley revoked bail after finding Cosmo had violated bail conditions barring him from access to any computer or the Internet.
Cosmo “will bend the rules if he feels it will serve his interests,” the judge said at the time. “He is unlikely to abide by any condition or conditions of his release.”
President Ali Abdullah Saleh abruptly returned home to Yemen on Friday after more than three months of being treated in Saudi Arabia for wounds from an assassination attempt, in a move apparently aimed to ensure his grip as his loyalists and opponents wage urban warfare in the capital.
Hours after his return, the fighting intensified as heavily shelling hit the strongholds of Saleh’s opponents in the capital, reinforcing fears that his return signals an escalation of fighting into an full-fledged attempt to crush his rivals.
The White House was blindsided by the sudden return. U.S. officials conceded it was a surprise and said Secretary of State Hillary Rodham Clinton wasn’t warned of Saleh’s plans when she met Tuesday in New York with the foreign minister of Saudi Arabia, which has been working with Washington and Yemen to try to arrange a transfer of power.
The return could be a significant blow to those attempts. A degree of stability in the strategic but impoverished Arab nation is a priority for the United States, which wants a partner to continue the fight against one of al-Qaida’s most active branches, based in Yemen and accused of plotting attacks in the U.S. Islamic militants have already exploited months of turmoil to seize control of cities in southern Yemen.
Abdullah Obal, an opposition leader, said he believed Saleh “returned to run the war and drive the country into an all-out civil war.”
“The cannons are now speaking. Gunfire is doing all the talking,” Obal said.
Saleh made no immediate public appearances, but his return breathed life into the camp of his supporters who turned up in the thousands for the Friday sermon that became a massive show of faith in the country’s leader for 33 years.
“We love you, Ali,” chanted thousands massed on Boulevard 70, a street near the presidential compound.
The return threatens to further break open the deep divisions that have riven Yemen since the protest movement kicked off in February demanding Saleh’s ouster and an end to his authoritarian regime. Saleh’s security forces cracked down hard on protesters, killing hundreds, which prompted members of his government, miltary and allied tribes to join the opposition.
In early June, an explosion ripped through a mosque where Saleh was praying in his Sanaa presidential compound. The blast left him severely burned over much of his body and wounded with wooden shards, and nearly a dozen of his top aides were seriously wounded. Saleh has since been in Saudi Arabia for treatment.
Both the U.S. and Saudi Arabia were believed to be trying to keep Saleh from leaving Saudi Arabia, and signing onto a deal proposed by Gulf Arab states, under which he would resign and hand power to his vice president to form a national unity government in return for immunity from any prosecution.
The mercurial Saleh has repeated promised to sign the agreement, then refused at the last minute.
White House Press Secretary Jay Carney said Friday, “We urge President Saleh to initiate a full transfer of power and arrange for presidential elections to be held before the end of the year within the framework” of the agreement.
“A political solution is the best way to avoid bloodshed,” he said.
This week, the deadlock that endured even during Saleh’s absence broke down into the worst violence in months after he recently delegated his vice president to restart negotiations with opponents on the deal. It was considered another stalling tactic by Saleh. It sparked an escalation in the protests and a violent crackdown in Sanaa and other cities.
Forces loyal to the president’s son Ahmed attacked protesters in the streets and battled troops led by one of the regime’s top rivals, Maj. Gen. Ali Mohsen al-Ahmar, a former Saleh aide who joined the opposition early in the uprising, as well as tribal fighters who back the protesters.
Around 100 people have been killed _ mostly protesters as regime troops hit their gathering with shelling or barrages of sniper fire from rooftops. Residents have been forced to hunker down in their homes or flee the city as the two sides exchanged bombardment over Sanaa from strongholds in the surrounding hills.
Saleh slipped back into the country before dawn on Friday. In a statement on the state news agency, he called for a truce, saying “the solution won’t be through cannons and barrels, but through dialogue, understanding and ending the bloodshed.”
But his opponents dismissed the negotiations call, convinced that Saleh has no intention to step down and aims to break his rivals with military force. Sultan al-Barkani, the head of the ruling party’s bloc in parliament and a Saleh backer, told Al-Jazeera television that it was “totally unlikely” that the president will resign. “Saleh will not leave except through elections,” he said.
Obal, the opposition member, blamed the U.S. and Saudi Arabia for not exerting enough pressure on Saleh to quit. He said the opposition was hardening its position in the face of Saleh’s return and that any accord “can no longer give guarantees against prosecution amid all this killing.”
Violence continued even after Saleh’s return. Thuds of mortar rounds raged after sunset in the northern and western part of the capital where Saleh’s opponents have been based. Mortars hit the square in central Sanaa where protesters demanding Saleh’s ouster are camped out, killing two. Other mortars hit a group of anti-Saleh tribal fighters in a neighborhood where battles have raged with Saleh loyalists, killing two tribesmen.
During a brief lull in the fighting, there were mass protests by both sides.
At the opposition rally on Boulevard 60, demonstrators carried pictures of those killed in the violence as speakers urged security forces to stop killing their own people. “The people want the trial of the butcher,” the crowd chanted.
Abdel-Hadi al-Azazi, a protest leader, warned that Saleh’s return means “more divisions, more escalation and confrontations.”
“We are on the verge of a very critical escalation,” he told The Associated Press.
April Alley, a Yemen researcher with the International Crisis Group, said Saleh’s suprise return put both his supporters and opponents off balance, creating an explosive situation but one with also high stakes.
“There is greater incentive to actually come through with a deal,” she said, particularly as negotiations over ways to implement the power transfer had been ongoing until the recent violence.
Retired army general Ahmed Salem said Saleh, an astute military man who has balanced tribal and security loyalties for decades, will be driven by the battle cry.
“He will attempt to stop the advances of his adversaries, and will try to improve his situation on the ground,” Salem said. “His return will enable his supporters, lifts their spirit after a period of confusion because of lack of political management.”
The city’s board of aldermen had their first opportunity to hear a request by Ralcorp Holdings for public subsidies to help fund its headquarters expansion project.
Alderwoman Phyllis Young introduced the bill for Ralcorp’s request for the city to offer $20 million in bond financing and property tax breaks on new equipment at the St. Louis Board of Aldermen’s meeting today.
It was the bill’s first reading at the board, and no vote was taken on the measure. The request will next be heard by the board’s housing and urban development committee next month.
Ralcorp, a publicly held company that makes cereal, pasta and other foods, wants to expand its leased space downtown and spend $6.9 million on improvements.
The company has more than 400 local employees and says it expects to hire an additional 100 employees and needs to expand its office space.
Keeping the jobs downtown is the impetus behind the incentives, Young said. “It stabilizes our income stream because we keep those employees, it increases the value of the building and the real estate taxes with it, and the employees that will be added will bring revenue,” she said. ”All of those are very important.”
In a statement, Ralcorp said it conducted a regional search for its office space needs and is negotiating with its landlord to expand in the Bank of America Plaza at 800 Market Street.
The Ontario Securities Commission has partly lifted its ban on trading in controversial timber company Sino-Forest to allow the completion of several options trades.
The Canadian Derivatives Clearing Corporation had asked the OSC to allow the completion of almost 9,000
The National Hurricane Center says Tropical Storm Nate has weakened somewhat as it heads toward expected landfall later today in southern Mexico.
The Miami-based center said at 5 a.m. EDT (0900 GMT) Sunday that Nate was centered 60 miles (95 kilometers) northeast of Veracruz. It said Mexican authorities have replaced a hurricane warning from Tuxpan to Veracruz with a tropical storm warning. Nate has top sustained winds of 60 mph (95 kph) and is moving west at 7 mph (11 kph) low fee payday loans.
Meanwhile, U.S. forecasters say Tropical Storm Maria had 60-mph (95-kph) winds early Sunday, intensifying slightly while moving northwest at 13 mph (20 kph) on a gradual course away from the northeast Caribbean toward the open Atlantic. Maria’s center was 95 miles (150 kilometers) east-northeast of St. Thomas early Sunday.
Yahoo’s stock rose nearly 5 percent on Wednesday after the company fired its CEO following more than 2 1/2 years of financial lethargy.
Tuesday’s ouster came as investors were convinced that Carol Bartz couldn’t steer the Internet company to a long-promised turnaround.
To fill the void, Yahoo’s board named Tim Morse, its chief financial officer, as interim CEO. Bartz, who became CEO in 2009, lured Morse away from computer chip maker Altera Corp. two years ago to help her cuts costs. Yahoo said it is looking for a permanent replacement.
Yahoo Chairman Roy Bostock, also a target of shareholder frustration, informed Bartz about the move over the phone, according to an e-mail the outgoing CEO sent from her iPad that was obtained by the All Things D technology blog. The blog first reported Bartz’s ouster.
Yahoo didn’t return requests for comment Tuesday and Wednesday.
Bartz’s rude dismissal “made you feel a little bit like you were watching some reality TV show,” Forrester Research analyst Shar VanBoskirk said Wednesday.
Macquarie Securities analyst Ben Schachter said the handling of Bartz’s departure was unseemly and a sign of even more drama to come at Yahoo.
In a research note late Tuesday, Schachter predicted there will be a wide range of conjecture about Yahoo’s future, with the most likely speculation centering on Yahoo as a takeover target during a vulnerable time.
Alternatively, Yahoo could make a bold move itself by trying to buy the online video site Hulu.com, which is already talking to suitors, or trying to sell its 43 percent stake in the Alibaba Group, one of China’s most prized Internet companies. Bartz’s tense relationship with Alibaba CEO Jack Ma had fed investor dissatisfaction about her leadership.
Youssef Squali at Jefferies & Co. said that the Internet company’s challenges, and the fact that Bartz was Yahoo’s third CEO in four years, will make it tough for the board to find an “A player” for the job.
Squali said Yahoo could be sold to a large media company like News Corp. or be bought by some sort of consortium that could feature Microsoft Corp. or AOL Inc.
“In all, we believe that it is more likely that the board reaches an agreement to sell the company or parts of the company before a new CEO is found,” Squali wrote Wednesday.
In a statement Tuesday, Yahoo said it is undergoing a “comprehensive strategic review” in its latest effort to give investors a reason to buy its stock, but the company didn’t offer details.
Bartz, 63, led an austerity campaign helped boost Yahoo’s earnings, but the company didn’t increase its revenue even as the Internet ad market grew at a rapid clip.
The financial funk, along with recent setbacks in Yahoo’s online search partnership with Microsoft Corp. and the Alibaba investment, proved to be Bartz’s downfall. Her ouster comes with 16 months left on a four-year contract that she signed in January 2009.
That contract entitles her to severance payments that could be two to three times her annual salary and bonus, along with stock incentives she received during her tenure. Bartz received a $2.2 million bonus to supplement her $1 million salary last year.
Yahoo has now replaced three CEOs in a little over four years. During that time, Yahoo has lost ground in the Internet ad race to online search leader Google Inc. and Facebook even though its website remains among the world’s most popular.
Known for her no-nonsense leadership and sometimes gruff language, Bartz arrived at Yahoo as a respected Silicon Valley executive who had won praise for turning around business software maker Autodesk Inc. But she had no previous experience in Internet advertising, the main way Yahoo makes money.
That hole in her resume immediately raised questions whether she was qualified for the job, and those doubts only escalated as Yahoo’s revenue continued to sag.
At first, Bartz blamed bad timing; she started the job during some of the bleakest months of the Great Recession. Later, she would say that she inherited such as mess from her two predecessors, Yahoo co-founder Jerry Yang and former movie studio boss Terry Semel, and that it would take time to get Yahoo back on the right track.
At one point, she even compared her challenge to those that faced Steve Jobs when he returned to Apple Inc. as CEO in 1997.
Unlike Jobs, Bartz never was able to articulate a strategy to win over investors.
“She focused on plugging holes in the ship instead of turning it around,” said Gartner Inc. analyst Ray Valdes.
The disappointing performance was reflected in Yahoo’s stock price, which closed Tuesday at $12.91. That’s 81 cents, or 7 percent, higher than where Yahoo shares stood when Bartz was hired as CEO. During the same period, Google’s stock price has risen by more than $200, or 66 percent, and the technology-driven Nasdaq composite index has climbed by 60 percent. A group of investors led by Goldman Sachs Group concluded privately held Facebook is worth $50 billion in an appraisal done earlier this year. That’s triple Yahoo’s current market value.
Bartz never hit any of the price targets that the board set for her when she was hired. That means none of the 5 million stock options that she received upon signing her contract had vested by the time she was ushered out the door.
Investors seemed happy to see Bartz go. On Wednesday, the Sunnyvale-based company’s stock rose 61 cents, or 4.7 percent, to $13.52.
Although Bartz’s exit as CEO came suddenly, her departure isn’t a shock. The pressure to replace her grew earlier this year after Bartz acknowledged Yahoo’s search partnership with Microsoft wasn’t producing as much revenue as the companies anticipated.
Then, in May, Yahoo stunned investors by disclosing that Alibaba had spun off an online payment service in a move that threatened to diminish the value of Yahoo’s investment in the Chinese company.
Alipay in July agreed to a complex settlement that could eventually be worth more than $1 billion to Yahoo, but there were too many uncertainties in the deal to placate shareholders.
Bostock had steadfastly stood behind Bartz whenever she was attacked by investors or analysts. In a Tuesday statement, Bostock thanked Bartz for “her service to Yahoo during a critical time of transition in the company’s history” without providing an explanation for why the board decided to replace her.
BGC partners analyst Colin Gillis said Yahoo’s board “has got to look in the mirror here.”
“Swapping the CEO without swapping the (board) chair doesn’t solve your problem,” he said. “The person that hired Carol to begin with deserves to share the culpability.”
To help Morse, Yahoo set up an “executive leadership council” that includes some of the executives that Bartz recruited, including the company’s products guru Blake Irving and the head of its North American operations, Ross Levinsohn. While he worked for News Corp., Levinsohn helped put together the Hulu video site and is seen as a possible CEO candidate.
Analysts also have speculated that David Kenny, an Internet veteran who joined Yahoo’s board in April, might be a candidate for Yahoo’s CEO job. Kenny is currently president of Internet networking services provider Akamai Technologies Inc.
With its stock sagging and its management in limbo, Yahoo could be more vulnerable to a takeover attempt by a private equity group or another opportunistic bidder attracted to what remains one of the Internet’s best-known brands. Microsoft offered to buy Yahoo for $47.5 billion, or $33 per share, in 2008 only to be rebuffed.
Asian markets opened lower Tuesday after fears of a worsening global economy sparked a session of free-falling losses in Europe.
Oil prices fell to below $84 a barrel in Asia as investor fears of a recession in developed countries sent equities and commodities lower. The dollar was higher against the euro but lower against the yen.
Japan’s Nikkei 225 index dropped 1.2 percent to 8,676.12. Hong Kong’s Hang Seng index was 1 percent down at 19,420.47. Australia’s S&P ASX 200 lost 1.1 percent to 4,095.50. South Korea’s Kospi index was 0.6 percent down at 1,774.73.
The slump in Asia comes a day after European shares booked sharp losses. Britain’s FTSE 100 closed the day down 3.6 percent to 5,102.58. Germany’s DAX tumbled a massive 5.3 percent to 5,246.18, and France’s CAC-40 plummeted 4.7 percent to 2,999.54.
A wave of negative sentiment was unleashed Friday by a government report that said the U.S. economy failed to add any new jobs in August. That caused European and Asian stock markets to sink sharply Monday.
The August jobs figure was far below economists’ already tepid expectations for 93,000 new U.S. jobs and renewed concerns that the U.S. recovery is not only slowing but actually unwinding.
U.S. hiring figures for June and July were also revised lower, adding to the gloom. The unemployment crisis has prompted President Barack Obama to schedule a major speech Thursday night to propose steps to stimulate hiring.
The health of the U.S. economy is crucial for the wider world because consumer spending there accounts for a fifth of global economic activity. The U.S. imports huge amounts from Japan and China and is closely linked at all levels with the European market.
Traders are hoping for signs that the Federal Reserve might take action at its September meeting to support the economy _ perhaps a third round of bond purchases, dubbed quantitative easing III or QE3.
Wall Street, which was closed Monday due to the Labor Day holiday, was bracing for losses Tuesday.
Benchmark oil for October delivery was down $2.47 to $83.98 in electronic trading on the New York Mercantile Exchange. Crude last settled at $86.45 on Friday because U.S. markets were closed Monday for the holiday.
In London, Brent crude for October delivery was steady at $110.08 on the ICE Futures exchange.
In currencies, the euro weakened to $1.4074 Tuesday from $1.4187 in New York late Friday as worries mounted about Greece’s ability to meet requirements set by international lenders to stave off a massive default on the country’s debts.
The dollar weakened to 76.82 yen from 76.87 yen. Last month, the dollar fell under 76 yen, which was a new post-World War II high for the Japanese currency.
Scotiabank (TSX: BNS) reported Tuesday that its third-quarter profits rose 18 per cent to $1.29 billion, helped by recent acquisitions and strength in its international division.
Canada
JACKSON HOLE, WYO.
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