Business news in brief

Friday, November 30, 2012

QUOTE OF THE DAY

“The longer these brands are off the shelves, the less they’re going to be valued.”

Joshua Scherer,

a financial adviser for Hostess Brands Inc., on the plan to quickly sell the bankrupt company Article, 1D

Sparks Health CEO gets promotion

D. Melody Trimble, the chief executive officer of Sparks Health System in Fort Smith, has been promoted to president of Health Management Associates Inc.’s Southern and Western Group.

Trimble has been CEO of the hospital since 2009. According to a news release from Sparks Health System on Thursday, Trimble will help find her replacement and then relocate to Naples, Fla.

Trimble’s promotion is effective Jan. 1. The Southern and Western Group includes 26 hospitals in seven states.

Trimble will replace John D. Pinion, who will retire at the end of the year.

Gary D. Newsome, president and CEO of Health Management, praised Trimble in a news release, saying that she was a strong leader who made Sparks thrive and that she brings key nursing experience to her new post.

Health Management, through its subsidiaries, operates 70 hospitals with approximately 10,2500 licensed beds throughout the U.S.

Mortgage rates stay near record lows

WASHINGTON - Average U.S. rates on fixed mortgages stayed close to record lows this week, a trend that has made homebuying more affordable and helped the housing market recover.

Mortgage buyer Freddie Mac, the Federal Home Loan Mortgage Corp., said Thursday that the average rate on the 30-year loan edged up to 3.32 percent. That’s close to last week’s rate of 3.31 percent, the lowest on records dating to 1971.

The average on the 15-year fixed mortgage ticked up to 2.64 percent from 2.63 percent last week, also a record low.

To calculate average mortgage rates, Freddie Mac surveys lenders across the country on Monday through Wednesday of each week. The average doesn’t include extra fees, known as points, which most borrowers must pay to get the lowest rates. One point equals 1 percent of the loan amount.

The average fee for 30-year loans was 0.8 point, up from 0.7 point last week. The fee for 15-year loans was unchanged at 0.6 point.

The average rate on a one-year adjustable-rate mortgage was steady at 2.56 percent. The fee for one-year adjustablerate loans ticked up to 0.5 point from 0.4.

The average rate on a five-year adjustable-rate mortgage fell to 2.72 percent from 2.74 percent last week. The fee remained at 0.6 point.

Barnes & Noble reports small profit

NEW YORK - Barnes & Noble’s shares fell Thursday after it reported a second-quarter profit but slowed digital content growth as it faces increased competition from rivals such as Amazon and Google.

Net income totaled $2.2 million for the three months ended Oct. 27. That translates to a loss of 4 cents per share, however, after the impact of preferred stock dividends. That matched analysts’ expectations, according to analyst firm FactSet.

The results compare with a prior-year loss of $6.6 million, or 17 cents per share.

Revenue was nearly flat at $1.88 billion. Analysts expected revenue of $1.91 billion.

Revenue from stores fell 3 percent to $996 million. Revenue in stores open at least one year, excluding sales of Nook products, rose 1.8 percent.

The largest traditional book retailer has invested heavily in its Nook e-business as consumers increasingly shop online and read e-books. Barnes & Noble said revenue from its Nook business grew, but device sales fell lower average selling prices for the Nook. Digital content revenue grew 38 percent, but that was down from a 46 percent increase in the fiscal first quarter.

The company’s shares fell $1.79, or 11.2 percent, to $14.26 in Thursday trading.

Revenue from the New York company’s Nook division rose 6 percent to $160 million.

WASHINGTON - The Army Corps of Engineers is open to expedited dynamiting of rock formations on the upper Mississippi River and increasing the flow from a tributary to prevent curtailing barge traffic on the nation’s busiest waterway, Sen. Tom Harkin, D-Iowa, said Thursday.

“They’re hopeful they can start on this in December,” said Harkin, who was among lawmakers from his state, Illinois, Missouri and Minnesota urging the Corps to act.

Mississippi River barge traffic is slowing as the worst drought in five decades and a seasonal dry period push water levels to a near-record low, prompting shippers, including Archer-Daniels-Midland Co., to seek alternatives.

Harkin said lawmakers Thursday will ask the Corps to assess the impact of water released from the Missouri River, which may be completed within the next week and increase the flow on the Mississippi.

The problem area is upstream from the Ohio River confluence with the Mississippi - north of Arkansas.

The Corps has agreed to respond to the lawmakers request “fairly quickly.”

Lawmakers and shippers have urged President Barack Obama to declare an emergency, which would allow the blasting to begin at the same time the Corps releases water from the Missouri, Harkin said after the meeting.

GM-China venture to build 3rd plant

HONG KONG - General Motors Co. and its joint venture partners in China say they will spend $1 billion to build a third car plant to keep up with demand for vehicles in the world’s biggest auto market.

The SAIC-GM-Wuling venture said the first phase of the factory will open in 2015.

The plant will be capable of turning out 400,000 vehicles and engines a year. It will help the joint venture reach its goal of producing 2 million vehicles a year in China by 2015.

The company said Wednesday that it wouldn’t decide which models to make until closer to the start of production.

The new factory will be in Chongqing city in central Sichuan province. The venture’s other two plants are located in Liuzhou in southern Guangxi region and Qingdao, on China’s northeastern coast.

China has been the world’s biggest auto market by vehicles sold since 2009, when it surpassed the United States.

Some 18.5 million vehicles were sold in China last year and automakers expect the number to rise to 30 million by 2020.

Shanghai-based SAIC Motor Corp. owns 50.1 percent of SAIC-GM-Wuling, while GM China owns 44 percent and Liuzhou-based Wuling Motors owns 5.9 percent.

Business, Pages 30 on 11/30/2012