Alcoa to cut 8,000 jobs
Alcoa Inc will cut 8,000 jobs as part of a restructuring announced as the aluminum maker reported a wider fourth-quarter loss Wednesday, citing a sour aluminum market. For the quarter ended Dec. 31, the company lost US$223 million, or US$0.27 per share, as revenue slipped to US$5.06 billion from US$5.10 billion a year earlier. The loss was worse than the US$0.25 per share predicted by analysts surveyed by Thomson First Call and far wider than the year-ago loss of US$142 million, or US$0.17 per share. The world's largest aluminum producer said it continue its aggressive cost-cutting program by reducing its global work force by about 6 percent. It also said it had reviewed all its businesses ranging from alumina to automotive and will spin off those that do not deliver "superior returns."
■ US economy
Consumer borrowing falls
US consumer borrowing fell in November for the first time since January 1998, evidence that Americans are becoming more wary of taking on debt. Borrowing through credit cards and other types of loans decreased at an annual rate of 1.5 percent, or US$2.2 billion, the Federal Reserve said. That follows an increase of US$1.5 billion in October and would be the biggest decline since a US$2.4 billion rate in October 1991. The credit figures are often volatile and some previous declines have later been revised into gains. Unemployment at an eight-year high in November has shaken consumer confidence, prompting households to use restraint in spending and taking on less debt. Holiday sales at Target Corp and Wal-Mart Stores Inc were lower than forecast, suggesting consumers may not lead the economy to a firmer footing.
Max Factor heir flees
An heir to the Max Factor cosmetics fortune has disappeared in the middle of his trial on 87 sex crime counts. Andrew Luster's trial continued without him Wednesday in California. On Monday, Luster, 39, the great-grandson of Max Factor, failed to show up in a Ventura County court, media reports said. The judge declared him a fugitive and issued an arrest warrant for him. He is charged with rape, sodomy, sexual battery and poisoning, among other charges, after he was accused of drugging then raping three women. Videotapes of two of the assaults were shown during Luster's trial, which began Dec. 16. The defendant said he was innocent, and his attorney said the sex was consensual and that Luster was an aspiring producer of pornographic movies. Luster, who allegedly jumped his US$1-million bail, disappeared while under house arrest.
SAP meets profit target
SAP AG, the world's largest maker of business management software, met its target to increase its operating margin after its revenue last year rose "slightly" from a year ago. Fourth-quarter revenue from software licenses totaled 950 million euros (US$999 million), the company said in a statement to the Frankfurt exchange. Analysts had expected license revenue of 824 million euros, according to a Bloomberg News survey. SAP, whose software helps customers such as Nestle SA manage business tasks including payroll and accounting, in October abandoned a forecast to increase sales by at least 5 percent last year.