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BUSINESS NEWS15 Apr 05

15 Apr 05. Raytheon Company (NYSE: RTN) announced that it has submitted an offer of settlement to the staff of the Securities and Exchange Commission (“SEC”), which the staff has agreed to recommend to the SEC, to resolve a pending, previously-disclosed investigation into the Company’s disclosures and accounting practices, primarily related to its Raytheon Aircraft Company (“RAC”) commuter aircraft business, during the period from 1997 to 2001. Following discussions with the SEC staff, the Company made an offer of settlement to the SEC staff in order to resolve this matter. The Company, without admitting or denying any wrongdoing, offered to pay a civil penalty of $12m and consent to the entry of a cease and desist order with respect to violations of Sections 17(a)(2)-(3) of the Securities Act of 1933 and Sections 13(a) and 13(b)(2)(A)-(B) of the Securities Exchange Act of 1934, and related SEC rules. The SEC staff has agreed to recommend that the SEC approve the offer of settlement. The proposed settlement is subject to approval by the SEC.

14 Apr 05. IBM sent a shudder through the technology sector last night by announcing first-quarter earnings substantially below expectations. The announcement, brought forward from Monday, raised questions about the strength of global demand for computer hardware, software and IT services. Quarterly revenue and earnings from Sun Microsystems, one of IBM’s main competitors, were also lower than expected. The results are a setback for Mr Palmisano, who has been working to persuade investors that the largest technology group has bright growth prospects despite fierce competition in many of its main markets. Following the announcement, which came after the close of regular trading in New York, IBM stock lost $4.60 to $80, its lowest level for almost two years.In the three months to March, earnings per share were 85 cents, up from 79 cents a year ago but 5 cents below expectations. The figures include a charge to account for the expensing of equity-based compensation, the first time IBM has adopted such an accounting policy. Revenues were $22.9bn, up 3 per cent but also below expectations. Excluding the impact of currency movements, underlying revenue growth was only 1 per cent. (Source: FT)

13 Apr 05. Advanced Micro Devices announced it was spinning off its Spansion flash memory business as its first quarter earnings took another big hit from the loss-making business. Spansion, a 12 year-old joint venture with Fujitsu of Japan that makes memory chips for mobile phones and other devices, announced an initial public offering in New York expected to raise as much as $600m. AMD said sales of $447m for the memory group in the first quarter were down 29 per cent on a year earlier and 11 per cent compared to the fourth quarter. Operating losses nearly tripled from the fourth quarter’s $39m to $110m. AMD’s bigger rival Intel has made dramatic gains in market share with an aggressive pricing strategy for NOR flash. AMD has been under pressure from analysts and investors to act decisively to prevent Spansion becoming a permanent drag on its profitable processor division and overall earnings. Memory chips have accounted for around 40 per cent of AMD’s revenues. AMD said the microprocessor business had delivered record sales in what was typically a down quarter seasonally. Sales of AMD Opteron and Athlon 64 processors were double that of a year ago and processor sales overall gained 31 per cent to $750m. The company said the growth was driven by record sales for chips in servers and mobile devices and, geographically, by strong penetration of Greater China.But AMD’s net loss of $17m or four cents per share missed analyst forecasts of earnings of two cents. A year earlier, it recorded a net profit of $45.1m or 12 cents a share. Overall sales were $1.227bn and the operating loss was $46m.(Source: FT)

12 Apr 05. Computer Associates International Inc. on Tuesday said it will take a $35m tax charg

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