Business briefs for April 18, 2002

Thursday, April 18, 2002 | 11:08 a.m.

Profits fall

NEW YORK -- Saying companies spent less on its computer equipment and services, technology giant IBM Corp. reported a 31 percent drop in first-quarter earnings, in line with the reduced expectations it laid out last week in a rare earnings warning.

The Armonk, N.Y.-based company on Wednesday said it earned $1.19 billion, or 68 cents a share in the quarter that ended March 31. In the year-ago quarter, IBM earned $1.75 billion, or 98 cents per share.

Revenue fell 12 percent to $18.6 billion from $21.0 billion a year earlier.

Leading indicators rise 0.1 percent

NEW YORK -- A key gauge of U.S. economic activity rose in March, suggesting continued growth in the months ahead, a private research firm said today.

The New York-based Conference Board reported its Index of Leading Economic Indicators inched up 0.1 percent last month to 112.3 after holding steady in February. Analysts had forecast a 0.3 percent gain.

"The recovery in the leading index suggests the economy is poised for growth through late summer," said Conference Board economist Ken Goldstein.

He said the small increase in the index was not surprising.

"Since the latest recession was short and shallow, it will not provide the thrust delivered by earlier recessions," Goldstein said.

SBC posts loss

SAN ANTONIO -- SBC Communications today reported a loss for the first quarter of 2002 due to a charge relating to the value of one of its subsidiaries.

SBC, one of the nation's largest local telephone companies, said it lost $81 million, or 2 cents per share, in the quarter ended March 31. The company posted a profit of $1.9 billion, or 54 cents a share, in the same period in 2001.

SBC's revenue of $12.6 billion, including proportional results from Cingular, the nationwide wireless company 60 percent owned by SBC, was also lower than a year ago. In the first quarter of 2001, the company had $13.1 billion in revenue.

In Nevada, SBC owns Nevada Bell, which provides local phone service outside of the Las Vegas area.

Merger vote tally released

SAN FRANCISCO -- A preliminary tally by an independent proxy firm shows that Hewlett-Packard Co. shareholders narrowly approved the bitterly contested acquisition of Compaq Computer Corp., though the fight over the $20 billion deal is far from over.

After meticulously counting the proxies for nearly a month, IVS Associates of Newark, Del., told HP Wednesday that 837.9 million shares, or 51.4 percent of those cast, were in favor of the Compaq deal, with 792.6 million, or 48.6 percent, against it.

That supported HP Chief Carly Fiorina's claim immediately after the March 19 vote that shareholders had approved the deal by a "slim but sufficient margin." Dissident director Walter Hewlett, who led the campaign against the deal, had maintained the vote was too close to call; people in his camp had said HP's edge was less than 1 percent of the votes cast.