REVIEW
August 1 – 7
Tenet Settles: Tenet Healthcare Corp. agreed to pay $54 million to settle allegations that doctors at a Tenet hospital in Redding performed unnecessary heart surgeries. The settlement only covers patients who get health insurance through U.S. government programs. Santa Barbara-based Tenet didn’t admit guilt and won’t face criminal charges. The settlement may allow Tenet to focus on other government investigations that have hammered its stock.
Poor Credit: California had its credit rating cut one level, to A3 from A2, by Moody’s Investors Service because the state budget calls for borrowing $14 billion and does not cut enough spending to avoid future deficits. Credit downgrades raise the cost of future borrowings and reduce the value of existing bonds.
Earnings Reports: Health Net Inc. reported second-quarter net income of $74.5 million, compared with $64.7 million for the like period a year ago. Revenue for the Los Angeles-based health care company rose 9.8 percent, to $2.8 billion. Salem Communications Corp. reported second-quarter net income of $1.8 million, compared with $1.6 million for the like period a year ago. Revenue for the Camarillo-based radio station operator rose 8.4 percent, to $43.4 million. Edison International, owner of Southern California Edison Co., reported second-quarter net income of $24 million, compared with $665 million for the like period a year ago. Revenue for the Rosemead-based energy company rose 11 percent, to $3.1 billion. The sharp decline in net income was attributed to a drop in the value of eight Illinois power plants. Public Storage Inc. reported second-quarter net income of $84.3 million, compared with $80.7 million for the like period a year ago. Revenue for the Glendale-based operator of self-storage facilities was $218.9 million, up from $207.9 million. Univision Communications Inc. reported second quarter net income of $41.6 million, compared to $22.2 million a year ago. Revenue dropped 1 percent to $320.2 million. Entravision Communications Corp. reported second-quarter net income of $1.2 million, compared with a loss of $4.4 million for the like period a year ago. Revenue for the Santa Monica-based station group rose 13 percent, to $64.1 million. Guess Inc. reported a second-quarter loss of $5.4 million, compared with a loss of $6.4 million for the like period a year ago. Revenue for the Los Angeles-based retailer rose 9.4 percent, to $131 million.
Navy Contract: Northrop Grumman Corp. received a $1.9 billion award from the U.S. Navy to design, build and demonstrate an updated version of its E-2 Hawkeye spy plane. The Hawkeye has been the Navy’s primary surveillance and patrol aircraft since its first use in 1973. Most of the design and testing work will be done in Bethpage, N.Y.
Almost Done: The Federal Communications Commission, in an initial vote, approved Univision Communication Inc.’s $2.8 billion purchase of Hispanic Broadcasting Corp. The merger likely will get final approval later this month. Public interest groups and some Democrats say the deal would reduce programming diversity and increase ad rates in Spanish-language media.
Chicken Fix: Quarantines on poultry shipments coming out of California were lifted by the U.S. Department of Agriculture as the deadly Newcastle disease, which kills chickens but does not pose a threat to humans, appears to be under control. In addition to the quarantine, more than 3 million birds were destroyed in Southern California. As of last week, only 22 farms were still under quarantine.
Energy Update: The California Independent System Operator, which manages the state’s power-transmission grid, was ordered to turn over documents to federal prosecutors about power supply and prices during the energy crisis in 2000 and 2001. Federal prosecutors launched a criminal investigation last year into whether power companies or traders manipulated California’s electricity markets to boost revenue during the power crunch. Two former Enron Corp. traders pleaded guilty to fraud and a third Enron manager has been charged.
Kobe Update: Kobe Bryant’s preliminary hearing was set for Oct. 9 in Eagle County, Colo. At that time, prosecutors will disclose some of the evidence against Bryant, who has been charged with sexual assault. Judge Fred Gannett will then rule if there’s enough evidence for the case to continue.
PREVIEW
August 11 – 17
Earnings Due: This week marks the debut quarterly earnings filings from Maguire Properties and Molina Healthcare. Other local companies releasing numbers are Laser-Pacific Media, which has a deal to be purchased by Eastman Kodak, and S & P; 500 component firm Computer Sciences.
Sports Beat: The big story this week is the X Games, which gets underway on Thursday (14th) at Staples Center and the Coliseum. The events include skateboarding, surfing, motocross and BMX. The Galaxy are home on Saturday (16th) against the MetroStars. Both the Dodgers and Sparks are away this week. Also this week is the PGA Championship, the last of golf’s majors this year.
Economic Reports: A grab bag this week: Monday (11th), it’s the Kansas City and Chicago manufacturing indexes (sometimes providing clues on the economy’s direction). Business inventories for June are reported on Wednesday (13th), June’s trade deficit and July’s producer price index are Thursday (14th), and on Friday (15th), it’s the July consumer price index, July industrial production and capacity utilization numbers, and consumer sentiment data from the University of Michigan.
African Festival: The 18th annual Los Angeles African Marketplace & Cultural Faire opens on Sunday (16th) at Exposition Park from 10 a.m. to 9 p.m. The fair includes a variety of booths and entertainment. It will run every weekend through Labor Day, Sept. 1. In addition, an African Unity Village will be featured at the Los Angeles County Fair in Pomona from Sept. 19-21. For information: 323-734-1164.
Jewish Arts: The Skirball Cultural Center presents the Harry and Belle Krupnick International Jewish Arts Festival beginning on Sunday (10th) and running through Aug. 28. The festival, which includes music, theater, dance, lectures and films, draws on artists who utilize Jewish tradition in their work. For information: 310-440-4500.
Greek Time: The annual L.A. Greek Fest will be held this weekend (15th-17th) on the Grand Plaza of the St. Sophia Cathedral located in the Byzantine Latino Quarter of Los Angeles. This event is L.A.’s premier Greek Festival featuring the best of Greek foods, pastries, music, and folk dancing along with exotic gifts and arts and craft booths. For information: 323-737-2424.
Tax Workshop: A workshop sponsored by the Valley Industry and Commerce Association on alternatives to the city of L.A.’s gross receipts business tax will take place on Wednesday (13th) from noon to 2 p.m. at the Airtel Hotel in Van Nuys. For information: 818-817-0545.
