Review
January 10-16
Hospital Profits: Tenet Healthcare Corp. reported net income for the second quarter ended Nov. 30 of $315 million, compared with $89 million for the like period a year ago. Revenue for the Santa Barbara-based hospital operator was $3.78 billion from $3.39 billion. However, Tenet warned investors not to expect similar results in the future because of anticipated cuts in Medicare collections. Separately, the California Nurses Association charged that Tenet overcharged employers and insurers for workers’ compensation claims as California lawmakers began hearings into pricing policies. Tenet denied the charge.
Earnings Season: Hughes Electronics Corp. reported fourth-quarter net income of $115.3 million, compared with a net loss of $132.6 million for the like period a year ago. Sales for the El Segundo-based parent of DirecTV rose 8.3 percent, to $2.47 billion. The fourth-quarter profit included a gain related to its merger settlement with rival EchoStar Communications Corp. KB Home reported fourth-quarter net income of $123.7 million, compared with $88.5 million for the like period a year ago. Revenue for the L.A.-based homebuilder rose 16 percent, to $1.68 billion.
Copyright News: The U.S. Supreme Court upheld a law extending every U.S. copyright for 20 years, preserving Walt Disney Co.’s exclusive rights to Mickey Mouse and Donald Duck and AOL Time Warner Inc.’s ownership of “The Wizard of Oz.” The 7-2 ruling removes a threat to the largest media companies, which stood to lose more than $300 million a year in royalties plus potentially more in copyrighted sales.
Disney Departure: Another top-level executive of Walt Disney Co. is leaving the company. Executive Vice President and General Counsel Lou Meisinger will become a consultant for Sheppard Mullin Richter & Hampton, the L.A.-based law firm, where he will help start an institutional entertainment and media practice. At Disney, Meisinger handled its 1999 legal feud with Jeffrey Katzenberg.
Mismanagement Claims: Idealab Inc. founder Bill Gross used corporate assets to cover margin calls on personal loans, according to a complaint filed by investors who placed $725 million in the creator of eToys Inc. The investors include the investment arm of Dell Computer Corp., a T. Rowe Price Associates Inc. fund and about 40 other shareholders who sued last year to remove the board and liquidate the company. A spokesman for Pasadena-based Idealab said the allegations are “taken completely out of context.”
Green’s Green: Leonard Green & Partners LP said it raised $1.85 billion for its latest private equity fund. The 14-year-old Los Angeles firm, whose founder Leonard Green died in October, said the fund will target $200 million to $1 billion in acquisitions. The firm owns the majority of senior debt of Rand McNally & Co., the map company that plans to restructure loans through a prepackaged bankruptcy filing.
Freedom Dispute: Family members of Freedom Communications Inc., owner of the Orange County Register, will meet next month to resolve a long-standing conflict over the media company’s future. The February meeting could determine whether some or all the family members will cash out of the Irvine-based company.
Piracy Alliance: Music distributors struck an agreement with computer software and hardware makers, including Microsoft Corp. and Dell Computer Corp., on how to fight digital piracy of recordings. The Recording Industry Association of America, the Business Software Alliance and the Computer Systems Policy Project agreed on a set of principles to balance the rights of copyright owners and consumers by enforcing existing laws. The music industry’s position is split from its traditional allies, such as the movie studios, which want Congress and the Federal Communications Commission to impose restrictions on devices that could duplicate film illegally.
Preview
January 20-26
TV Conclave: The National Association of Television Program Executives holds its annual convention beginning on Monday (20th) in New Orleans. The annual NATPE get-together has lost its significance over the years with the general decline in TV syndicated dollars. Still, it’s a big deal for the folks who distribute “Judge Judy” and the like.
Sports Beat: The Lakers are back in town after a short road trip. They face the Clippers on Monday (20th), Golden State on Wednesday (22nd) and New Jersey on Friday (24th). Besides the Lakers game on Monday, the Clippers are on the road. The Kings are at home on Thursday (23rd) against Minnesota and Saturday (25th) against New Jersey. And let’s not forget Super Bowl XXXVII on Sunday (26th) in San Diego.
Econ Data: An unusually slow week, with December’s leading economic indicators on Thursday (23rd) about the only number with any chance of moving markets.
Transit Meet: The Los Angeles Area chamber of Commerce will sponsor a meeting on Wednesday (22nd) to discuss transportation funding issues that will be presented later during a lobbying trip to Washington. Information: 213-580-7558.
King Holiday: State and federal offices, banks and schools will be closed on Monday (20th) in observance of Martin Luther King Jr. Day. Numerous observances are planned throughout Los Angeles, though most private businesses will remain open.
Development Talk: Culver City’s new community development director, Susan Evans, will be the featured speaker on Thursday (23rd) at a luncheon meeting of the Culver City Chamber of Commerce. The luncheon, sponsored by the Westside Small Business Development Corp., will begin at noon at the Ramada Plaza Hotel in Culver City. Information: 310-287-3850.
More Earnings: Among the local companies scheduled to release earnings this week are Activision, Newhall Land & Farming, Amgen, Ryland Group and Countrywide Financial.
Real Discussion: The Real Estate Conference Group will be hosts a one-day event Tuesday (21st) at the Beverly Hilton Hotel featuring a keynote address by John Cushman, chairman of Cushman & Wakefield. Information: 310- 271-1276.
