Sun, Oct 23, 2011 - Page 11 News List

Business Quick Take

Agencies

AUTOMAKERS

Ford climbs ratings ladder

Ford Motor Co is within one notch of an investment-grade credit rating at two of the three major ratings agencies after Standard and Poor’s (S&P) on Friday boosted the automaker two notches up its ratings ladder. S&P said the outlook for Ford is “stable.” This follows an upgrade of one notch by Fitch Ratings on Thursday. Fitch also rates Ford at “BB+,” the highest level of “speculative” or “junk” status, one notch below the lowest “investment grade” rating. Moody’s Investors Service has Ford rated two notches below its lowest level of investment grade. Moody’s rates Ford at “Ba2” on its credit risk ladder. Ford was last at investment grade in 2005, the year before it borrowed heavily to finance its restructuring. S&P said of the new four-year labor contract: “We believe the contract will allow for continued profitability and cash generation in North America.”

RETAIL

Wal-Mart reworks benefits

US retail giant Wal-Mart Stores Inc said on Friday it would no longer provide health insurance to new part-time US employees working less than 24 hours a week and charge more for workers who smoke. Wal-Mart, which has 1.4 million employees in the US, said it would also increase coverage costs for all employees, as health costs rise. The changes, which will affect Wal-Mart and Sam’s Club associates, are due to take effect in January. “This lowering of working standards will have repercussions throughout the retail industry — particularly for part-time workers,” said Joseph Hansen, president of the United Food and Commercial Workers International Union.

TECHNOLOGY

Wii, 3DS to stream Hulu

Nintendo Co said on Friday that online video service Hulu Plus would stream movies and television shows to Wii and 3DS video game systems by the end of the year. The Japanese video game giant also planned to release next month a software update that would let people record 3D video using the latest version of its handheld gaming device. Hulu Plus will be available with a separate subscription costing US$7.99 per month. Subscribers will be able to access Hulu’s extensive library of television episodes and films. The company hoped to heighten the appeal of its offerings during the precious year-end holiday shopping season.

INDUSTRY

GE profits rise 18 percent

General Electric Co (GE) said Friday that a surge in its lending business lifted its profit 18 percent in the third quarter, but its stock price fell on concerns about weak contributions from its manufacturing businesses. GE is a barometer of the economy because it reaches so many industries. It builds everything from jet engines to refrigerators, and its GE Capital lending arm is involved in a variety of businesses including credit cards and real estate. The company’s industrial orders grew 16 percent in the quarter and it has a record backlog of them. However, many of those orders came more than a year ago, and the cost of raw materials and other expenses have risen since. That could erode profits. The industrial and financial giant reported net income of US$2.34 billion, or US$0.22 per share, for the three-month period ended Sept. 30. That compared with US$1.98 billion, or US$0.18 per share, a year earlier. Revenue was flat at US$35.4 billion. The company’s overall profit has increased for four straight quarters as falling interest rates sparked a rebound at its GE Capital lending business.

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