Holiday discounts crimp retailers’ profits
NEW YORK » The 2011 holiday shopping season will go down in the record books as the year the Grinch stole stores’ profits.
Many retailers sacrificed their bottom lines by pushing heavy discounts to shoppers bent on getting a good deal in a challenging economy. That created a sharp divide between stores that won the battle for wallets and those that didn’t.
The big winners? Shoppers who held out for deals late in the season.
Retailers collectively reported a 3.5 percent increase in revenue at stores open at least a year for December, according to a tally of 25 merchants compiled by the International Council of Shopping Centers. For November and December combined, the figure rose 3.3 percent, a solid increase but smaller than last year’s 3.8 percent rise.
GM to redesign Volt to protect battery
DETROIT » General Motors is advising Volt owners to return their electric cars to dealers for repairs that will lower the risk of battery fires.
The company hopes adding steel to the plates protecting the batteries will ease worries about the cars’ safety. Three Volt batteries caught fire after government crash tests last year, prompting a federal investigation and sending GM engineers scrambling for a fix.
Eligible for the fix announced Thursday are 8,000 Volts on U.S. roads and another 4,400 still for sale. The repairs are covered under a "customer service campaign" run by GM, which is similar to a safety recall but allows the carmaker to avoid the bad publicity and federal monitoring that come with a recall.
Barnes & Noble looks at options for Nook
NEW YORK » Barnes & Noble is considering options for its fast-growing but expensive electronic book business, its latest attempt to regain profitability as the publishing industry adapts to the rising popularity of digital books and magazines.
Investors fled as the company also forecast a much bigger loss for the year than originally expected. The bookseller’s stock lost nearly a fifth of its value on Thursday.
Barnes & Noble has been investing heavily in e-books and its Nook readers as it faces tough competition from online retailers and discount stores. Those investments have led to losses for the New York-based company, even though the new business is growing as consumers shift to reading e-books.
Eli Lilly profit forecast misses expectations
INDIANAPOLIS » Financial analysts expected Eli Lilly’s 2012 earnings to slip after the drugmaker lost patent protection for a its top-selling product, but they didn’t envision a decline as steep as the one Lilly forecast Thursday.
The Indianapolis company said it will earn between $3.10 and $3.20 per share in its first full year after losing the U.S. patent that protects its antipsychotic Zyprexa from generic competition. Analysts on average had been expecting earnings of $3.60 per share, according to FactSet.
Zyprexa rang up more than $5 billion in 2010 sales and $3.87 billion through the first nine months of 2011.
The patent expired in October. Lilly expects revenue from Zyprexa, which has now lost patent protection in most markets outside Japan, to plunge by more than $3 billion in 2012.
Alcoa to shutter Tennessee, Texas facilities
NEW YORK » Alcoa Inc. plans to close an aluminum smelter in Tennessee and some operations at a Texas facility to cut costs in the face of weak prices.
The moves will reduce Alcoa’s global smelting capacity by about 12 percent.
The company said Thursday that it will permanently close the smelter in Alcoa, Tenn., which was curtailed in 2009, and shut two of six idle lines at a smelter in Rockdale, Texas. It expects to complete the process in the first half of this year and announce other reductions soon.
ON THE MOVE
Coldwell Banker Pacific Properties has announced that Vic Melecio has joined the firm’s Kahala office. He previously worked as a Realtor at Cady and Stray, a brokerage firm in Chicago. Melecio has also owned and operated marketing and media companies for more than 20 years, including a company that specializes in design, marketing and full-service printing.
Hawaiian Airlines has appointed Stephen Simmons as managing director of operations planning and scheduling. He has more than 30 years of airline management experience, including as an independent aviation consultant for several domestic and international carriers for two years. He also served as director and managing director at Northwest Airlines for 16 years.
