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Shr 12 cts vs 30 cts
Net 4,255,000 vs 11.5 mln
Revs 199.4 mln vs 258.7 mln
Nine mths
Shr 64 cts vs 1.19 dlrs
Net 24.4 mln vs 45.5 mln
Revs 639.7 mln vs 824.3 mln
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Shr 20 cts vs 20 cts prior qtr
Pay May 14
Record April 30
Note: Full name Zenith National Insurance Corp.
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Shr five cts vs five cts prior qtr
Pay April 17
Record April 3.
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Shr 10 cts vs 10 cts prior qtr
Pay April 17
Record April 9.
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The Securities Industry Association
backed a variety of restraints on insider trading and hostile
corporate takeovers and asked Congress to define insider
trading in law.
The industry trade association called on U.S. securities
firms to take steps to protect sensitive corporate secrets to
guard against illegal trading by employees.
The association also backed broad federal restrictions on a
variety of tactics used in hostile corporate takeovers.
But it said investment banking firms should be allowed to
continue to engage in both arbitrage and merger and acquisition
activities so long as those functions were kept separate.
The SIA, in a report adopted yesterday by its board of
directors, backed a higher enforcement budget for the federal
Securities and Exchange Commission and called on U.S. stock
exchanges to beef up their supervision of member brokerages.
The report said securities firms "should be more rigorous in
restricting sensitive information on a need-to-know basis."
It said firms should train their employees to understand
the need for confidentiality of market-sensitive information.
It said legislation to define insider trading should avoid
expanding current law in a way that would impede the market.
It said an insider trading definition should exempt a
securities firm from liability for law violations by its
employees unless the firm had participated in or was aware of
the wrongdoing.
In the mergers and acquisitions area, the association
advocated a ban on greenmail payments or poison pill takeover
protection plans without prior shareholder approval.
It said a group or individual buying up a company's stock
should be required to file a public disclosure statement before
acquiring more than five pct of the company's shares. Under
current law, disclosure may be made as late as ten days after
exceeding the five pct limit.
The association said all purchases exceeding 20 pct of a
company's voting stock shouls be made only through a tender
offer open to all shareholders. Under current law there is no
limit on open market purchases.
The group said the federal government should preempt state
regulation of defensive takeover tactics.
The group said all tender offers should remain open for at
least 30 calendar days.
The current requirement is expressed in business days.
It said so-called "lockup" devices, in which securities are
issued to a friendly investor to seal a takeover deal or fend
off an unfriendly predator should be limited to 18.5 pct of the
target company's total common stock.
Association president Edward O'Brien said the group acted
out of concern over the ad hoc restructuring of corporate
America on Wall Street and investor fears about insider trading
and fairness in the marketplace.
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Texaco Inc's oil and gas reserves
declined in 1986 despite reduced production and upward
revisions in the company's previous reserve estimates, its
annual report said.
The statement of the report's auditor was qualified -- as
was the previous one -- because of the unkonwn final impact of
the judgement won by Pennzoil Co <PZL> against Texaco on
charges Texaco interfered with Pannzoil's contract to acquire
Getty Oil Co.
The auditor's point out, as Texaco has in the past, the
company's loss of any of several pending court decisions in
this case could cause it "to face prospects such as having to
seek protection of its assets and business pursuant to the
bankruptcy and reorganization provisions of Chapter 11" of the
federal bankruptcy code.
Commenting on a Texas Court of Appeals ruling which reduced
Pennzoil's judgement by two billion dlrs, to 9.1 billion dlrs,
Texaco said it will file a motion for a rehearing by the
appeals court no later than March 30.
Texaco said the proven crude oil reserves of the company
and its consolidated subsidiaries totaled 2.54 billion barrels
at the end of 1986, down from 2.69 billion a year earlier.
However, inclusion of Texaco's equity in the Eastern
Hemisphere reserves of a nonsubsidiary company limited the
decline to 2.91 billion barrels from 3.00 billion at the end of
1985.
Worldwide production by the consolidated subsidiaries
declined to 341 mln barrels last year from 362 mln in 1985 and
upward revisions in previous reserve estimates rose to 143 mln
barrels from 117 mln, respectively.
Texaco said the largest drop in reserves came in the United
States -- where the total dropped to 1.46 billion barrels from
1.55 billion.
The company said U.S. liquids production averaged 660,000
barrels per day last year, down from 714,000 in 1985, with
about 44 pct of the decline -- some 24,000 barrels per day --
representing high-cost production shut-in or curtailed in
response to the decline in crude oil prices during 1986.
Texaco said its natural gas reserves totaled 8.16 trillion
cubic feet at year end, down from 8.87 trillion cubic feet at
the end of 1985.
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Qtly div 10 cts vs 10 cts prior
Pay May 1
Record April 10
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Qtly 29-1/2 cts vs 29-1/2 cts prior
Payable June 1
Record May 1.
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Southwestern Bell Corp said that
its planned acquisitions of cellular telephone and paging
systems, including those of <Metromedia Inc>, will result in
some initial earnings dilution and an increase in debt ratio.
In a letter to shareholders in its 1986 annual report, the
regional Bell company did not indicate the degree of earnings
dilution it expects from the acquisitions, which total some
1.38 billion dlrs. However, the company said the rise in its
debt ratio will be temporary and will leave its debt level
within an acceptable range.
In its 1986 yearend financial statement, Southwestern Bell
listed a debt-to-equity ratio of 43.4 pct, down slightly from
43.7 pct in 1985.
In 1986, the company earned 1.02 billion dlrs, or 10.26
dlrs a share, compared with 996.2 mln dlrs, or 10 dlrs a share
in 1985. Revenues dipped to 7.90 billion dlrs from 7.93 billion
dlrs.
Southwestern Bell said it expects the new tax law to have a
negative impact on its cash flow, due mainly to the loss of
investment tax credits.
By mid-year, however, the company said a reduced corporate
tax rate should have a positive impact on its net income and
cash flow.
In addition, the company said it is projecting a 1.7 pct
gain in customer telephone lines and a three to four pct
increase in long distance calling volumes.
Southwestern Bell said 1987 capital expenditures will be
lower that the 1.97 billion dlrs spent in 1986, a year in which
expenditures were held below budget.
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Brazil wants to increase its
steel exports to the United States, now limited because of
tough import restraints set in 1984 by the Reagan
administration, a spokeswoman for the Brazilian Steel Institute
(IBS) said.
Brazilian and U.S. Trade officials held the first of a
three-day meeting today in Brasilia to discuss the issue.
In 1984, after three months of painstaking negotiations,
the U.S. Government reached accords with seven steel-exporting
nations - Australia, Brazil, Japan, Mexico, Spain, South Africa
and South Korea - to reduce their shipments to the United
States by about 30 pct in 1985.
The 1984 restraints established that for 1987 Brazil's
steel exports to the U.S. Could not exceed 632,000 tonnes,
increasing to 640,000 tonnes in 1988 and 670,000 tonnes in
1989, the last of the five-year deadline set by the agreements.
Brazilian officials are trying to increase Brazil's export
share of non-flat products to the U.S. Market.
The spokeswoman said there were reports of domestic supply
problems in the United States.
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Nordson Corp said its board
declared a 3-for-2 stock split to be paid as a 50 pct stock
dividend on April 30 to shareholders of record April 10.
As a result, the number of shares outstanding will increase
to 10.2 mln from 6.8 mln, the maker of industrial equipment
said.
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Commerce Secretary Malcolm Baldrige
said the U.S. trade deficit should start to decline soon,
possibly in the figures for February or March.
"We could see the trade deficit start down in February or
March," Baldrige said in an appearance before the Senate
Governmental Affairs Committee.
He predicted the trade deficit, which was 170 billion dlrs
in 1986, would decline by 30 to 40 billion dlrs in 1987 and in
1988.
Baldrige said he was making his prediction without having
seen the February trade figures, but he said that the volume of
imports has dropped beginning with the fourth quarter of 1986
and will continue to drop in this quarter.
The eventual turnaround in the monthly trade figures will
reflect the impact of the decline in the dollar, Baldrige said.
Ealier, Treasury Secretary James Baker told the committee
that the trade deficit had levelled off, but Baldrige said he
was more optimistic, adding, "I think we turned the corner in
February."
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Normal work has resumed at New
Zealand ports as negotiations between harbour board workers and
employers continue.
Wellington Harbour Board Workers' Union secretary Ross
Wilson told reporters talks late yesterday ended with agreement
to take unresolved issues before an industrial conciliator.
Wilson said the only remaining issue is the length of the
union award. The dispute originally was about wage rates and
the form of industry negotiations.
Cook Strait ferry sailings resumed after Marlborough
Harbour Board workers returned to work this morning, ending
their industrial action a day early.
The Waterside Workers' Federation, which struck for most of
last week and held more than one mln tonnes of shipping in
ports, meets on Monday and Tuesday in conciliation with the
Waterfront Employers' Association.
Union Secretary Sam Jennings said: "We've got two days of
talks. If it's not all cleaned up by then ... I don't know what
will happen."
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Shr loss 13 cts vs loss one ct
Net loss 18,600,000 vs profit 3,300,000
Revs 394.0 mln vs 351.0 mln
YEAR
Shr loss 21 cts vs loss 16 cts
Net loss 23,300,000 vs profit 3,900,000
Revs 1.36 billion vs 1.29 billion
Note: Current yr loss includes reorganization charge of
15.2 mln dlrs vs yr-ago reorganization charge of 17.6 mln dlrs.
Shr after preferred divs.
U.S. dlrs.
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Net 492,000 vs 677,000
Year
Net 2,650,000 vs 2,566,000
NOTE: Company's full name is Indiana Federal Savings and
Loan Association. Per share information not available. Bank
went public on February 11, 1987.
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Forstmann Little and Co said Lear
Siegler Holding Corp plans to divest its aerospace group
subsidiary, comprised of the Defense Electronics Group and the
Components Group.
Divestitures had been expected since Lear-Siegler, a
diversified conglomerate, was acquired last December in a 2.1-
billion-dlr-leveraged buyout by the Wall Street firm of
Forstmann Little.
Lear's aerospace group revenues for fiscal 1987 are
expected to be about 700 mln dlrs, said Forstmann.
The Defense Electronics Group designs and manufactures
weapons, management systems, flight control systems, remotely
piloted vehicles and reference and navigation systems, mainly
for military markets.
The Defense Group subsidiaries are Astronics Corp, which is
based in Santa Monica, Calif., and employs 1,076 people;
Instrument and Avionic Systems Corp, based in Grand Rapids,
Mich., and employs 3,479 people; International Corp, based in
Stamford, Conn., and employs 266 people; and Development
Sciences Corp, based in Ontario, Calif., and employs 237
people.
The Components Group manufactures pumps, bearings, and
other industrial components as well as nuclear control drive
rod mechanisms and valves.
The Group's subsidiaries include Power Equipment Corp,
based in Cleveland, which employs 880 people; Energy Products
Corp, based in Santa Ana, Calif., which employs 755 people;
Romek Corp, based in Elyria, Ohio, which employs 262 people;
and Transport Dynamics in Santa Ana, which employs 254 people.
Overall, Lear's Aerospace Group's eight subsidiaries
employs 7,200 people.
Lear Siegler said it plans to retain Management Services
Corp, engaged in aircraft maintenance modification for various
Department of Defense agencies.
Morgan Stanley and Co will act as financial advsiors for
the group's divestitures.
Last month, Lear Siegler said it planned to sell its Smith
and Wesson handgun business, Starcraft Recreational Products
Ltd, the Peerless truck trailer operations, and other units, as
part of its restructuring plans.
Lear apparently will retain its Piper Aircraft unit.
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Rubbermaid Inc said it completed
the previously announced acquisitions of Viking Brush Ltd, a
Canadian maker of brushes, brooms and other cleaning aids, and
the Little Tikes' manufacturing licensee in Ireland.
Terms were not disclosed.
The acquisition of the Tikes' licensee is part of the
expansion of Little Tikes in the European toy market.
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Oper shr loss 16 cts vs loss 44 cts
Oper net loss 8,926,000 vs loss 14.4 mln
Revs 9,920,000 vs 21.2 mln
Year
Oper shr loss 4.30 dlrs vs loss 2.24 dlrs
Oper net loss 221.8 mln vs loss 53.7 mln
Revs 51.4 mln vs 94.4 mln
Note: Oper net excludes losses from discontinued operations
of 228,000 dlrs vs 4,253,000 dlrs for qtr and 10.4 mln dlrs vs
14.2 mln dlrs for year.
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Shr profit one ct vs loss four cts
Net profit 53,040 vs loss 255,568
Rev 2,252,246 vs 755,605
Six months
Shr profit three cts vs loss eight cts
Net profit 217,884 vs loss 517,538
Rev 4.9 mln vs 1.6 mln
NOTE: Company's full name is Chemfix Technologies Inc.
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Qtly div 40 cts vs 40 cts prior
Pay June 10
Record May 27
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Qtly div 41 cts vs 41 cts prior
Pay May 1
Record April 8
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<Fiduciary Trust Co International>
said its shareholders at the annual meeting approved a
five-for-one stock split effective May 15, 1987, to holders of
record on April 15, 1987.
The company said the split would increase the number of
authorized common shares from 440,000 to 2,200,000 shares
issued. In addition, the company said it authorized another
800,000 shares, but would not issue them at this time.
The company also changed the stock's par value from 10 dlrs
a share to 2.50 dlrs a share.
It explained it transferred 1,100,000 dlrs from its
undivided profits account to its capital account in order to
raise the new par value from two dlrs, under the five-for-one
split, to 2.50 dlrs.
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Modulaire Industries said it
acquired the design library and manufacturing rights of
privately-owned Boise Homes for an undisclosed amount of cash.
Boise Homes sold commercial and residential prefabricated
structures, Modulaire said.
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Shr profit 25 cts vs loss nine cts
Net profit 3,433,000 vs loss 1,310,000
Revs 37.1 mln vs 39.0 mln
Nine mths
Shr profit 28 cts vs profit 27 cts
Net profit 3,883,000 vs profit 3,908,000
Revs 133.2 mln vs 132.0 mln
Avg shrs 13.8 mln vs 14.2 mln
Note: Current net includes gain on sale of 31 inns of
7,719,000 dlrs for qtr and 7,975,000 dlrs for nine mths.
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The Semiconductor Industry
Association urged the U.S. government to impose trade sanctions
against Japan for violating the U.S.-Japan Semiconductor Trade
Agreement.
In a letter to Treasury Secretary James Baker the group
said sanctions should be imposed against Japanese chipmakers as
of April 1 and should continue until the United States is
satisfied that there is full compliance with the agreement.
The group said action by Japan to cut back on semiconductor
exports is not what is required.
"America's interests require that agreements be honored and
that U.S. industries not bear the burden for the persistent
unwillingness or inability of the government of Japan to
deliver on its commitments," the trade group said.
The White House Economic Policy Council is expected to
discuss possible sanctions against Japan at a meeting scheduled
for Thursday.
The trade group said Japan has not lived up to the terms of
the agreement last year which was aimed at ending Japanese
dumping of semiconductors and at opening Japanese markets to
foreign-based manufacturers.
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U.S. oil demand as measured by
products supplied rose 0.1 pct in the four weeks ended March 20
to 16.16 mln barrels per day from 16.15 mln in the same period
a year ago, the Energy Information Administration (EIA) said.
In its weekly petroleum status report, the Energy
Department agency said distillate demand was off 0.1 pct in the
period to 3.258 mln bpd from 3.260 mln a year earlier.
Gasoline demand averaged 6.72 mln bpd, off 1.2 pct from
6.80 mln last year, while residual fuel demand was 1.38 mln
bpd, off 2.1 pct from 1.41 mln, the EIA said.
Domestic crude oil production was estimated at 8.35 mln
bpd, down 7.8 pct from 9.06 mln a year ago, and gross daily
crude imports (excluding those for the SPR) averaged 3.44 mln
bpd, up 16.3 pct from 2.95 mln, the EIA said.
Refinery crude runs in the four weeks were 11.90 mln bpd,
up 1.4 pct from 11.74 mln a year earlier, it said.
In the first 78 days of the year, refinery runs were up 1.8
pct to an average 12.25 mln bpd from 12.04 mln in the year-ago
period, the EIA said.
Year-to-date demand for all petroleum products averaged
16.32 mln bpd, up 1.8 pct from 16.04 mln in 1986, it said.
So far this year, distillate demand rose 0.1 pct to 3.31
mln bpd from 3.30 mln in 1986, gasoline demand was 6.60 mln
bpd, up 0.1 pct from 6.59 mln, and residual fuel demand fell
0.4 pct to 1.42 mln bpd from 1.43 mln, the EIA said.
Year-to-date domestic crude output was estimated at 8.41
mln bpd, off 7.7 pct from 9.11 mln a year ago, while gross
crude imports averaged 3.96 mln bpd, up 28.1 pct from 3.09 mln,
it said.
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Kansas City Southern Industries Inc
said it is ready to promptly purchase the Southern Pacific
Transportation Co from Santa Fe Southern Pacific Corp <SFX> if
the Interstate Commerce Commission rejects Sante Fe's attempt
to reopen the merger of Southern and the Atchison, Tokepa and
Santa Fe Railway.
In a filing with the ICC late today, the company outlined
four conditions of its offer to acquire Southern Pacific.
Among the conditions are that Santa Fe enter into an
agreement to indemnify Kansas City for any contigent liabilites
of Southern Pacific existing as of the closing date, and that
the financial condition of Southern remain largely unchanged
from today onward.
"We are willing, even eager, to make a fair market value
offer in cash for the Southern Pacific," said Kansas City
Southern president and chief executive officer Landon H.
Rowland.
"This offer disproves the constant derogation of the
Sourthern Pacific by SFSP management, best exemplified by SFSP
Chief Executive John Schmidt's comment in ICC hearings that the
Southern Pacific was 'bankrupt,'" said Rowland.
He said that merging Southern with Kansas City will achieve
the benefits of an end-to-end merger while preseving the
independece of the Southern Pacific versus its existing prime
competitor, Santa Fe.
Kansas said that Southern's management had estimated the
value of the railroad in 1983 in the range of 281 mln dlrs to
1.2 billion dlrs.
It said that Morgan Stanley and Co Inc and Salomon Brothers
Inc, hired in 1983 to advise Southern and Santa Fe in their
merger, appraised Southern as worth between 500 mln dlrs and
800 mln dlrs less than Southern's own internal valuations.
Kanasa City Southern said it will make an offer for
Southern after its books, records and properties are examined.
"Once that examination has been completed (and even in the
absence of a willingnes of SFSP to negotiate) KCSI will make an
offer in writing...." said the company.
Kansas also said it argued in the ICC filing that Santa Fe
had not met the legal requirements justifying the Commission's
reconsideration of the proposed merger of Santa Fe and Southern
Pacific, two railroads that it said basically parallel each
other throughout their routes.
ICC voted four to one last summer to reject the merger as
inherently anticompetitive. Kansas said Santa Fe in petitioning
for reconsideration now argues that the trackage agreements
with the Union Pacific, the Denver and Rio Grande Western and
other railroads, adds to the value of the merger.
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An investor group said it might be
willing to raise its 100 dlr per share offer for GenCorp but so
far the company has turned down requests for a meeting.
"We might be able to see some additional value if we could
meet" and get more financial data, said Joel Reed, speaking for
the investor group.
Reed told Reuters that GenCorp chairman A. William Reynolds
"was not interested in sitting down and talking with us at this
time." Cyril Wagner sought the meeting in a recent telephone
conversation with Reynolds, Reed said.
Wagner and Brown, along with AFG Industries Inc <AFG>,
recently launched a surprise tender offer for GenCorp. The
offer is worth 2.23 billion dlrs.
Reed said under the circumstances the 100 dlr per share
tender offer, which expires April 15, is a fair offer. GenCorp
gained 3-1/2 to 114 today on the NYSE.
Reed outlined a plan to reshape GenCorp in the event his
group wins control. He said aerospace, soft drink bottling and
entertainment units are potential divestiture candidates. He
said the tire business, which the group wants to keep, may be
more viable if merged with another tire company.
"One option would be to try to grow the tire business
through combination or an acquisition," Reed said. He said he
believes such a merger could create a stronger force in the
tire industry.
Gary Miller, chief financial officer of AFG, said his
company has a record of acquiring mature businesses and
boosting productivity. Automation and incentives tied to profit
sharing have been used with success, he said.
In the case of GenCorp's RKO General broadcasting stations,
Reed said the plan of the partners is to step into GenCorp's
shoes and proceed with plans to sell the stations.
The partners said if they succed in acquiring GenCorp they
intend to consummate sale of WOR-TV in New York to MCA Inc
<MCA>. GenCorp last year entered into an agreement to sell the
station for 387 mln dlrs.
The partners also said if they acquire Gencorp they would
also proceed with the proposed sale of KHJ-TV in Los Angeles to
Walt Disney Co <DIS>. RKO General would receive 217 mln dlrs
and Fidelilty Television, which challenged the license, would
get about 103 mln dlrs.
The partners also said the Federal Communications
Commission established an expedited schedule for receiving
comments on their request for special temporary authorization
of proposed trust arrangements while the FCC considers a formal
application for transfer of the broadcast unit.
Reed said he was pleased with the expedited schedule
because it provides time for the agency to act on the request
before the expiration of the tender offer.
He said it was the aim of the partners to move as quickly
as possible to eliminate uncertainty surrounding the stations.
Asked about criticism of the takeover attempt voiced by
some municipal officials in Akron, Ohio, where GenCorp is
headquartered, Reed said, "the plan of the partners offers long
term growth for Ohio."
He noted that the aerospace business, slated for
divestiture under the partners' plan, is located in California.
"Our program is one that overall would provide the greatest
long term growth for all segments," he said.
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Unocal Corp said it intends to
increase its spending for capital projects to 929 mln dlrs in
1987, eight pct more than the 862 mln spent in 1986.
The company said in its annual report that it would
increase spending for exploration and development of petroleum
resources by about three pct to 614 mln dlrs from 1986's 595
mln dlrs, assuming oil prices hold around current levels.
The planned spending for exploration and production in 1987
remains well below the 1.1 billion dlrs spent in 1985, Unocal
said.
The company's proved developed and undeveloped reserves of
crude oil rose slightly in 1986, Unocal said. Net crude oil and
condensate reserves were 752 mln bbls as of Dec 31, 1986,
compared to 751 mln bbls at the end of 1985, Unocal said.
The company said its net crude oil and condensate
production averaged 248,200 barrels per day in 1986 compared to
251,300 bpd in 1985.
Unocal said its worldwide natural gas reserves were 6.07
billion cubic feet in 1986 compared to 1985's 6.19 billion. Net
natural gas output averaged 976 mln cubic feet per day in 1986,
down 10 pct from 1985's 1,084 mln, the company said.
Unocal said its average sales prices for crude oil was
12.67 dlrs a barrel worldwide in 1986 compared to 23.81 dlrs in
1985, and its average sales price for natural gas was 2.03 dlrs
per thousand cubic feet in 1986 against 2.24 dlrs in 1985.
Average production costs for crude oil and natural gas
declined nearly 30 pct to 3.41 dlrs per bbl of oil equivalent
in 1986 from 4.81 dlrs in 1985, Unocal said.
In the annual report, the company called for imposition of
an oil import fee by the U.S. government to set a floor price
of about 25 dlrs a barrel for crude oil.
"Simply stabilizing prices at about 18 dlrs per barrel
will not materialy slow the drop in U.S. production or the rise
in imports," Chairman Fred Hartley said in the annual report.
"Without decisive action in Washington, this nation will
once again become a hostage to OPEC's plans and policies,"
Hartley said.
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Chemical New York Corp and Texas
Bancshares Inc <TCB> said the Federal Reserve Board approved
their proposed 1.19 billion dlr merger.
The companies also said the Securities and Exchange
Commission declared effective as of March 24 the registration
statement covering the securities Chemical will issue to Texas
Bancshares shareholders as part of the merger.
The companies said they expect to complete the merger,
which will create a bank with 80 billion dlrs of assets, by the
end of the second quarter. The merger still requires
shareholder approval.
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Varity Corp, earlier reporting a full
year loss against a prior year profit, said improvement is
expected in the balance of fiscal 1987 as new products fill the
inventory pipeline, cutbacks in operating costs are realized
and its newly acquired Dayton Walther business is fully
integrated.
However, operating results are likely to remain under
pressure in the first quarter ending April 30, it said.
Varity earlier reported a loss for fiscal 1986 ended
January 31 of 23.3 mln U.S. dlrs, compared to a year-earlier
profit of 3.9 mln dlrs.
Varity said continued deterioration in major markets, a
weakening U.S. dollar and unforeseen delays in launching major
new lines of tractors contributed to the full year loss.
Industry demand for farm machinery continued to erode
during the latest fiscal year, with worldwide industry retail
sales of tractors sliding more than 10 pct below last year's
depressed levels, the company said.
However, Varity increased its share of the global tractor
market by more than one pct to 18.2 pct, it said.
The combined impact of costly sales incentives and foreign
exchange adjustments on margins was substantial, Varity said.
Reuter
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Campbell Resources Inc said it raised
its voting stake in <Meston Lake Resources Inc> to about 64 pct
from 52 pct through acquisition of another 870,000 Meston Lake
shares in its previously reported takeover bid.
Campbell, in its bid that expired March 23, offered 80 cts
cash and 1.25 "legended" Campbell shares for each Meston share.
The legended shares are not tradeable for one year.
It said the 3.4 mln Meston shares not tendered in the offer
were held by about 550 stockholders, including Quebec's La
Societe de developpement de la Baie James, with 1.3 mln shares.
Reuter
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Metrobanc, a federal
savings bank, said its shareholders approved the previously
announced merger with Comerica Inc <CMCA>, a bank holding
company.
Metrobanc said the merger is still subject to regulatory
approval.
Reuter
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Oper shr loss 31 cts vs profit three cts
Oper net loss 887,886 vs profit 646,250
Revs 9,724,418 vs 10.8 mln
Note: Year-ago oper net excludes tax credit of 230,000
dlrs.
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Pennzoil Co said it had not yet
received any "meaningful settlement offer" from Texaco Inc but
added that the company remained willing to consider proposals
to settle the 10.2 billion dlr jury judgment it won against
Texaco.
In its newly-released annual report to shareholders,
Pennzoil said it expected the Texas state court judgment, which
was upheld by a state appeals court on February 12, to be
upheld if appealed again.
"To date, Pennzoil has yet to receive any meaningful
settlement offer from Texaco, though it remains open to any
realistic effort to settle the matter," Pennzoil chairman Hugh
Liedtke said in the annual report.
Pennzoil also said it had budgeted 212 mln dlrs for capital
spending in 1987, a drop from the 233 mln dlrs spent last year.
Proved U.S. and foreign reserves of natural gas declined to
964 billion cubic feet last year, from 1.01 trillion cubic feet
in 1985, because of a virtual halt in its exploration program,
Pennzoil said. Its crude oil reserves dropped to 140 mln
barrels from 158 mln barrels in 1985.
The Houston-based company said it sold an average of 339
mln cubic feet of domestic natural gas each day last year, a 17
pct drop from 1985. The average sales price for gas dropped by
60 cents per mcf to 2.16 dlrs per mcf, Pennzoil said.
U.S. crude oil and gas liquids production last year fell to
an average of 33,290 barrels per day from 34,102 barrels per
day in 1985.
The company's total revenues in 1986 declined to 482.3 mln
dlrs, from 762.5 mln dlrs the previous year. Operating income
in 1986 fell more than 80 pct, to 38.0 mln dlrs.
Pennzoil said its goals for 1987 included development of
its Point Arguello oilfield off the California coast, to
maintain current production levels in its Bluebell-Altamont
Field in Utah and to drill for prospects in the Gulf of
Mexico's Mobile Bay area.
"Production should begin late in the year from the Harvest
Platform in the Santa Maria Basin offshore California," the
company said. "Pennzoil's share of this production initially
should be five thousand barrels a day, increasing to a peak of
15 thousand barrels a day, net, by 1989."
In its sulphur business, Pennzoil said production totaled
2.1 mln long tons last year, a decline of 18 pct from 1985. The
average sales price also declined, to 138.25 dlrs per long ton
from 141.05 dlrs in 1985.
"The long term outlook for our sulphur operations remains
bright," the company said. "We expect sulphur's pricing
structure to strengthen during the current year, probably in
the third and fourth quarters."
Reuter
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Shr loss 20 cts vs loss 26 cts
Net loss 798,289 vs loss 777,667
Rev 262,738 vs nil
Avg shares 3,930,360 vs 2,959,029
Year
Shr loss 96 cts vs loss 1.25 dlrs
Net loss 3,202,355 vs loss 3,060,407
Rev 676,341 vs nil
Avg shares 3,339,174 vs 2,445,423
Reuter
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The House Banking Committee adopted
legislation to direct the U.S. Treasury to begin negotiations
aimed at seeking regular adjustment of exchange rates by
countries such as Taiwan and South Korea, whose currencies are
pegged to the value of the U.S. dollar.
The measure was adopted as part of a wide-ranging trade
bill that will be considered by the full House in April before
it moves on to the Senate.
The bill's many provisions also set as a priority for the
U.S. the negotiation of stable exchange rates and urge
government intervention as necessary to offset fluctuations.
In addition, the Banking Committee bill would authorize
U.S. banks to use a variety of means to deal with the debt
problems of developing countries, such as lowering interest
rates on existing debt, renegotiating loans or debt
forgiveness. The bill would give a blanket waiver of any
federal banking regulations that bar such actions.
The bill would direct Treasury Secretary James Baker to
discuss with debt-ridden developing countries the possibility
of the U.S. setting up a public debt management agency that
would purchase their debt at a discount and negotiate the
restructuring of the debt.
The Banking bill authorizes U.S. participation in a
multilateral investment guarantee agency (MIGA) as requested by
the administration. Congress would approve an initial U.S.
subscription of 22 mln dlrs.
And, it sets up a council on industrial competitiveness
composed of industry and administration members to explore ways
to make the U.S. more competitive in world markets.
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The Semiconductor Industry
Association urged the U.S. government to impose trade sanctions
against Japan for violating the U.S.-Japan Semiconductor Trade
Agreement.
In a letter to Treasury Secretary James Baker the group
said sanctions should be imposed against Japanese chipmakers as
of April 1 and continue until the U.S. is satisfied there is
full compliance with the agreement.
The group said action by Japan to cut back on semiconductor
exports is not what is required.
"America's interests require that agreements be honored and
that U.S. industries not bear the burden for the persistent
unwillingness or inability of the government of Japan to
deliver on its commitments," the trade group said.
The White House Economic Policy Council is expected to
discuss possible sanctions against Japan at a meeting scheduled
for Thursday.
The trade group said Japan has not lived up to the terms of
the agreement last year which was aimed at ending Japanese
dumping of semiconductors and at opening Japanese markets to
foreign-based manufacturers.
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Clabir Corp and AmBrit Corp
said they called off their plans for Clabir to buy the 16 pct
voting interest in AmBrit that it does not already own.
The companies said they agreed not to pursue the merger
because several actions recently taken by AmBrit would mean
substantial delays in completing the deal.
They said they might revive merger plans at a later date or
seek other ways for Clabir to increase its holdings in AmBrit.
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Congress, eager to find budget
savings, launches a review of the U.S. Agriculture Department's
generic commodity certificate program tomorrow, amid signs USDA
and the General Accounting Office, GAO, are at odds over how
much the program has cost U.S. taxpayers.
The GAO concluded in a preliminary report last week that
payment-in-kind, or PIK, certificates cost between five and 20
pct more than cash outlays, administration officials who asked
not to be identified said.
USDA officials, however, took issue with the report, saying
it did not take into account storage, handling and transport
savings that accrue to the government. The GAO then decided to
re-examine the costs, sources said.
The issue is an important one, because congressional budget
committees are known to be considering limiting the use of
certificates as a means of cutting spending.
Agriculture Under Secretary Daniel Amstutz and GAO Senior
Associate Director Brian Crowley are set to testify before the
Senate Agriculture Committee tomorrow.
Amstutz is expected to tell the committee that there are
uncertainties in determining the cost of certificates compared
to cash outlays, and that savings to the Commodity Credit Corp,
CCC, almost equal costs, department sources said.
USDA estimates that it costs the government about 75 cents
to store, handle and transport each bushel of commodity put in
government storage.
It was unclear whether the GAO, Congress' investigative
arm, would stick by its original analysis that it costs the
government more to use certificates instead of cash in farm
price and income support programs, Reagan administration
sources said.
The GAO is expected to point out that use of
payment-in-kind, PIK, certificates has helped relieve tight
storage by moving grain that otherwise might not have been
sold.
The testimony by Amstutz and GAO Senior Associate Director
Brian Crowley comes as congressional budget committees
intensify their efforts to pinpoint ways to cut the federal
budget deficit -- including considering limits on the use of
PIK certificates.
The CCC issues dollar-denominated PIK certificates, or
certs, as a partial substitute for direct cash outlays to
farmers or cash subsidies to exporters. Certs can be used to
repay nonrecourse loans or exchanged for CCC commodities or
cash.
Between April and December 1986, CCC issued 3.8 billion
dlrs worth of certificates, according to USDA. Up to another
6.7 billion dlrs worth could be issued between January and
August 1987, according to USDA.
Certs can cost the government more than cash primarily
because recipients can use the certificates to pay back
government loans at levels below the loan rate.
Eliminating this practice, called "PIK and roll," would save
the government 1.4 billion dlrs between 1988-92, according to
the Congressional Budget Office, CBO. That estimate, according
to a CBO official, was based on an assumption that certificates
cost the government about 15 pct more than cash payments.
The Senate and House Budget Committees are known to be
considering curbs on PIK-and-roll transactions among other
savings alternatives.
The GAO last week reached the tentative conclusion that the
estimated three billion dlrs of certificates redeemed to date
have cost the federal government between 150 mln and 600 mln
dlrs, or between five and 20 pct, more than cash outlays, one
administration official said.
However, the GAO has decided to reassess those estimates
based in part on USDA criticism, department officials said.
The broad range of the cost estimate is partly attributable
to the different effect certificates can have on market prices
over the course of a crop year.
USDA's Economic Research Service, for example, has found
that between June and August last year, the 215 mln bushels of
corn exchanged for certificates lowered the price of corn by
between 35 and 45 cents per bushel.
Between September and November, however, certificates had
only a marginal impact on corn prices, according to the ERS
study, obtained by Reuters.
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<Hollinger Inc> said 58 pct-owned <The
Daily Telegraph PLC>, of London, agreed to form a joint venture
printing company in Manchester, England with <News
International PLC>. Financial terms were undisclosed.
It said the deal involved News International's acquisition
of a 50 pct stake in the Telegraph's Trafford Park Printing Ltd
subsidiary. The joint company will continue to print northern
editions of the Telegraph and Sunday Telegraph, with spare
capacity used to print The Sun and News of the World.
The arrangement will significantly cut Telegraph costs,
Hollinger said.
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Qtly div seven cts vs seven cts prior
Pay June one
Record May four
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Five regional oil producing nations
will gather in Caracas tommorrow for a two-day meeting expected
to center on ways to combat proposals for a U.S. tax on
imported petroleum, the Venezuela's ministry of energy and
mines said.
Oil ministers from Mexico, Trinidad and Tobago, Ecuador and
Venezuela will be on hand for the fifth meeting of the informal
group of Latin American and Caribbean Petroleum Exporters,
formed in 1983, it said. Colombia will also attend for the
first time, as an observer nation, the ministry said.
Energy and Mines Minister Arturo Hernandez Grisanti said
the conference has no set agenda but one entire session Friday
will be devoted to proposals for a tax on imported oil.
Two of the group's members, Venezuela and Mexico, are
second and third largest foreign suppliers of oil to the United
States, respectively, following Canada.
Venezuela, concerned about the effect such a tax would have
on its exports, undertook a diplomatic push to coordinate
strategy against such measures. In February, Canadian Energy
Minister Marcel Masse was invited to Caracas for talks with
Hernandez on proposals for an oil import tax.
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The Reserve Bank of Australia this morning
cut the rediscount rate from 17.30 pct to 17.00 pct.
The rediscount is the rate at which the bank buys back
treasury notes.
Market sources said the cut reflected the recent easing in
market interest rates. They also pointed to yesterday's
treasury note tender where the 400 mln dlrs of 13-week notes
went at an average yield of 15.473 pct, down from 15.870 last
week. The 100 mln dlrs of 26-week notes went at an average
15.414 from 15.790 last week.
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Genova Inc said it signed a
definitive agreement for the previously announced merger with
<Genova Products Inc>.
Under the agreement, Genova Products will pay 5-3/8 dlrs a
share for the 29 pct of Genova's outstanding common shares it
does not already own.
The company said it plans to complete the transaction,
which requires shareholder approval, by the end of March.
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Shr 69 cts vs six cts
Net 421,306 vs 44,132
Revs 3,721,178 vs 3,125,935
Note: Current qtr net includes a gain of 281,000 dlrs,
mostly from the sale of securities and property.
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The House Banking Committee adopted
legislation to direct the U.S. Treasury to begin negotiations
aimed at seeking regular adjustment of exchange rates by
countries such as Taiwan and South Korea whose currencies are
pegged to the value of the U.S. dollar.
The measure was adopted as part of a wide-ranging trade
bill that will be considered by the full House in April before
it moves onto the Senate.
The bill's many provisions also set as a priority for the
U.S. the negotiation of stable exchange rates and urge
government intervention as necessary to offset fluctuations.
Reuter
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Shr 32 cts vs nil
Net 1.2 mln vs 100,000
Avg shrs 3,692,000 vs 3,148,000
Year
Shr 1.02 dlrs vs 54 cts
Net 3.7 mln vs 800,000
Avg shrs 3,607,000 vs 1,461,000
Note: Net is after depreciation.
Full name is Consolidated Captial Income Opportunity
Trust/2.
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Treasury Secretary James Baker said
he stood by the Paris agreement among leading industrial
nations to foster exchange rate stability around current
levels.
"I would refer you to the Paris agreement which was a
recognition the currencies were within ranges broadly
consistent with economic fundamentals," Baker told The Cable
News Network in an interview.
"We were quite satisfied with the agreement in Paris
otherwise we would not have been a party too it," he said.
Baker also noted the nations agreed in the accord to
"co-operate to foster greater exchange rate stability around
those levels."
He refused to comment directly on the current yen/dollar
rate but said flatly that foreign exchange markets recently
tended "to draw unwarranted inferences from what I say."
Baker was quoted on British Television over the weekend as
saying he has no target for the U.S. currency, a statement that
triggered this week's renewed decline of the dollar.
"I think the Paris agreement represents evidence that
international economic policy co-ordination is alive and well,"
Baker said.
The Treasury Secretary stressed however it was very
important for the main surplus countries to grow as fast as
they could consistent with low inflation to resolve trade
imbalances.
He added that Federal Reserve Board chairman Paul Volcker
has also "been very outspoken" in suggesting main trading
partners grow as fast as they can.
Baker noted that the J-curve, the delayed beneficial effect
of a weakening of a currency on that country's trade balance,
takes 12 to 18 months to work its way through to the trade
deficit and it is now 18 months since the Plaza agreement to
lower the dollar's value.
He also said improvements in the trade deficit should come
from other sources besides the exchange rate, and pointed out
the administration's package to improve U.S. Competitiveness
was now before Congress.
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Treasury Secretary James Baker said
he expected the U.S. Trade deficit to fall by 15 billion to 20
billion dlrs in 1987.
Commenting on the deficit during an interview on Cable News
Network, Baker said "I think you're going to see a 15 to 20
billion dlr reduction this year." The deficit was 170 billion
dlrs in 1986.
Baker noted that the benefits of a weaker currency take 12
to 18 months to affect the trade balance, and said it is now 18
months since the Plaza agreement to lower the dollar's value.
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Bank of Japan Governor Satoshi Sumita
said a further yen rise would have adverse effects on the
Japanese economy.
He told Japanese business leaders the Bank of Japan will
continue to take adequate measures, including market
intervention, to stabilize exchange rates if necessary, in
close cooperation with other major industrialized nations. He
said the current instability of exchange rates will not last.
Six major nations - Britain, Canada, France, Japan, the
U.S. And West Germany - agreed in Paris last month to act
together to hold currencies stable.
Sumita said the Bank of Japan will continue to pursue
adequate and flexible monetary policies while watching economic
and financial developments in and outside Japan.
He said the decision to cut the discount rate on February
20 was a hard choice for the Bank because monetary conditions
had already been sufficiently eased.
To prevent a resurgence of inflation, the Bank will take a
very cautious stance regarding developments stemming from easy
credit conditions, he said.
He said the latest discount rate cut to 2.5 pct should
stabilize exchange rates and expand domestic demand.
Commenting on the dollar's fall below 150 yen, Sumita
reiterated he cannot find any specific reason for the
currency's weakness.
The market undertook speculative dollar selling by reacting
to overseas comments by monetary authorities and trade tension,
he said.
Sumita repeated that the Japanese economy may gradually
recover in the latter half of the 1987/88 fiscal year ending
April 1, 1988, provided exchange rates stabilize.
REUTER
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The European Community (EC) considers
talks on agricultural trade reform to be inseperable from talks
on other trade reform in the present GATT round, Willy de
Clercq, external relations commissioner of the EC, said.
He told reporters here the EC would not bow to pressure to
reach an early, seperate agreement on agricultural trade.
He said the EC wanted to stick to the four-year schedule
agreed by members of the General Agreement on Tariffs and Trade
(GATT) in Punta del Este, Uruguay, last year. That included
agricultural trade liberalisation for the first time in the
lengthy program to re-negotiate the GATT.
Other trade issues being discussed in the current GATT
round include reform of trade in merchandise and services.
De Clercq is on his way to China after attending a two-day
conference for 22 GATT trade ministers held in New Zealand.
Several of those ministers criticised the EC for what they
saw as restrictive agricultural trade practices and called for
urgent reforms. U.S. Trade representative, Clayton Yeutter,
also said it was important agreement on agricultural trade
reform was reached as early as possible.
But de Clercq said the GATT program had been reached after
long and hard negotiations, and the EC did not want changes.
"We just want to stick to the agreement which was reached,
and that was very clear -- that the new round would be one
undertaking. It is a global negotiation with no two tracks, no
fast track, no slow track. It has just one track, the track -
and that's all," de Clercq said.
"If you start selecting priorities, your priority is not my
priority. We say that agriculture is urgent, but it's not the
only urgent thing," he said.
He said the Punte del Este agreement had taken eight months
to prepare and eight days of negotiations.
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Vietnam has ordered its army to grow
more food to ease shortages and meet economic recovery goals
set for 1990.
The army newspaper Quan Doi Nhan Dan, monitored here, said
soldiers must work harder to care for rice, vegetables and
other crops endangered by the present unusually hot weather.
The paper said the 1.6-mln strong regular army contributed
less than one pct to the nation's 18.2 mln tonne food output.
North Vietnam has set a 1990 food target of 23 to 24 mln
tonnes.
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Engineering group Linde
AG's <LING.F> world group turnover rose to 518.6 mln marks in
the first two months of 1987, 5.2 pct more than in the same
1986 period, management board chairman Hans Meinhardt said.
But world group incoming orders fell 2.2 pct to 587.3 mln
marks, Meinhardt told the annual news conference. Excluding
exchange rate movements, world group turnover rose 8.9 pct and
incoming orders increased 1.0 pct.
Linde expects satisfactory results and increased sales this
year but Meinhardt gave no detailed forecast. Domestic group
1986 net profit rose to 105.79 mln marks from 80.71 mln.
Meinhardt said domestic group turnover rose 6.7 pct to
394.1 mln marks in the first two 1987 months against the same
period last year but incoming orders fell 5.2 pct to 456.6 mln.
Linde will ask shareholders at the annual meeting on May 13
to raise authorised share capital by a maximum 30 mln marks
nominal for the issue of share warrant bonds with a maximum
issue volume of 200 mln marks. Linde's authorised share capital
currently stands at a nominal 49.6 mln marks.
Meinhardt said the authorisation would give the company the
necessary flexibility in case Linde needed additional funds for
acquisitions. He declined to give further details.
While world group turnover rose 7.2 pct to 3.88 billion
marks in 1986, incoming orders were barely changed at 3.91
billion marks. Meinhardt said without the sharp appreciation of
the mark against major trading partner currencies, incoming
orders would have been four pct above the prior year's level.
World group turnover in heavy plant construction rose 7.4
pct to 777 mln marks, but incoming orders dropped 5.7 pct to
739 mln marks in the wake of the dollar and oil price plunge.
World sales for technical gases rose 5.1 pct to 1.05
billion marks and incoming orders gained 5.2 pct to 1.05
billion marks.
Meinhardt said Linde strengthened its market position in
the refrigeration sector, with particularly strong turnover and
order gains in Austria, Italy and Norway. World group sales in
the sector fell 2.5 pct to 493 mln marks, but incoming orders
rose 2.5 pct to 513 mln marks.
The fork lift truck and hydraulic sector saw world group
sales rising 12.4 pct to 1.52 billion marks and incoming orders
gaining 8.0 pct to 1.57 billion marks.
Domestic group turnover rose 8.2 pct to 2.93 billion marks
and incoming orders increased 1.9 pct to 2.92 billion marks.
The company was producing at full capacity in 1986.
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Domestic group net profit 105.79 mln marks vs 80.71 mln
Turnover 2.93 billion marks vs 2.71 billion
Incoming orders 2.92 billion marks vs 2.86 billion
Order book at end December 2.28 billion vs 2.37 billion
Tax payments 104.98 mln marks vs 88.67 mln
Depreciation of fixed assets 107.25 mln marks vs 150.75 mln
New investment in fixed assets 148.88 mln vs 148.22 mln
Dividend already announced 12 marks vs 11
DVFA earnings per share 32.22 marks vs 27.54 marks
Shareholders annual meeting May 13, dividend date May 14
World group turnover 3.88 billion marks vs 3.62 billion
Incoming orders 3.91 billion marks vs 3.91 billion
New investment in fixed assets 247 mln marks vs 252 mln
No world group profit figures given
Parent company net profits 95.04 mln marks vs 74.91 mln
Turnover 2.28 billion marks vs 2.14 billion
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Bank of Japan Governor Satoshi Sumita
said it is in Japan's national interest to make greater efforts
to reduce its trade surplus.
He told business executives the most important issues for
the world economy are the correction of international trade
imbalances and a solution to the world debt problem.
To this end, Japan and the U.S. Must make medium- and
long-term efforts to alter economic structures which have
expanded the trade gap between the two nations. World economic
growth and therefore an expansion of debtor countries' export
markets are needed to solve the debt issue, he added.
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No action has been taken yet
on the Reagan Adminstration's offer to escort Kuwaiti oil
tankers through the Gulf, but the issue is being discussed,
U.S. Secretary of Defence Caspar Weinberger said.
The offer was made to Kuwait in light of Iran's deployment
of Chinese-built missiles to cover the entrance to the Gulf.
Weinberger told reporters prior to a speech at Texas
Christian University that he did not think Iran and the United
States were moving towards a potential conflict, adding that
the Straits of Hormuz at the mouth of the Gulf were still "free
water."
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Finance Minister Kiichi Miyazawa said
major nations are taking action to stabilise exchange rates in
line with their agreement in Paris last month, government
sources said.
Miyazawa told an Upper House session the six nations --
Britain, Canada, France, Japan, the U.S. And West Germany --
are abiding by the Paris accord. The six agreed to cooperate to
stabilise exchange rates at around current levels.
Miyazawa said he wishes to attend a meeting of seven major
nations (G-7) expected just before the IMF/World Bank Interim
Committee meeting in Washington starting on April 9.
The sources quoted Miyazawa as saying Japan is trying to
prevent a further rise of the yen. Japan is taking the matter
seriously, he added.
Asked if the six nations had agreed to stabilise the dollar
at about 153 yen, the rate prevailing at the time of the Paris
talks, Miyazawa declined to give specific figures and said any
mention of specific rates would create an "unexpected situation."
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Year ended December 31.
World group pretax profit 3.21 billion marks vs 3.16
billion.
Turnover 38.01 billion marks vs 42.72 billion.
World group turnover comprised domestic sales 10.83 billion
vs 10.80 billion, foreign sales 27.18 billion vs 31.92 billion.
Parent pretax profit 1.82 billion marks vs 1.62 billion.
Turnover 14.09 billion vs 15.35 billion.
Parent turnover comprised domestic sales 6.47 billion vs
6.84 billion, foreign sales 7.62 billion vs 8.51 billion.
Parent investment in fixed assets 960 mln marks vs 831 mln.
Depreciation of fixed assets 935 mln marks vs 847 mln.
Investment in new participations 2.53 billion marks vs 294
mln.
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The Federal Statistics Office will
today publish trade and current account figures for February, a
spokeswoman said in reply to queries.
In January the current account surplus provisionally
narrowed to 4.9 billion marks from 8.5 billion in December. The
provisional January trade surplus narrowed to 7.2 billion marks
from a record 11.6 billion marks the month before.
In February 1986 the current account had shown a 6.85
billion mark surplus and the trade account a 6.84 billion
surplus.
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The Bank of France said it set a money
market intervention tender today to inject funds to the market
against first category paper.
Money market sources said the surprise announcement might
herald a quarter percentage point cut in the central bank
intervention rate from the 7-3/4 pct level set March 10, but
they added such a cut was relatively unlikely.
The intervention rate was cut from eight pct on March 10
after being raised from 7-1/4 pct on January 2 to head off
speculative pressure against the franc.
Dealers said market fundamentals could justify a further
easing, but a combination of technical factors and renewed
currency uncertainties surrounding the dollar had put
short-term upside pressure on interest rates in recent
sessions.
Call money rose yesterday to 7-7/8 eight pct from 7-3/4 7/8
pct. Today it was first indicated at 8-1/8 1/4 before easing on
news of the tender to 7-13/16 7/8 pct.
Technical factors making for a slight shortage of liquidity
in the market included the settlement yesterday of the latest
monthly treasury tap stock tender, on March 5, market sources
said.
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British Petroleum Co Plc <BP.L> said it
intended to make a tender offer for the 45 pct of Standard Oil
Co <SRD.N> it does not already own at 70 dlrs a share cash, for
a total of 7.4 billion if the offer is fully accepted.
The offer would be made through its <BP North America Inc>
unit and was intended to commence not later than April 1. The
offer would not be conditional on any minimum number of shares
being tendered.
BP said in a statement the 70 dlr a share price was based
on its own valuation as well as those of its financial
advisers. It took into account reviews of both public and
non-public information.
Standard closed in New York last night at 64-7/8 dlrs, down
1-3/4 dlrs.
BP shares dropped on the announcement to 877p from 888p at
last night's close.
About a third of the cash payable would be met from BP's
own resources.
The remainder would come from new borrowings, partly from
banks under a four-year committed revolving credit facility and
partly from a a new U.S. Dlr commercial paper programme. The
company said it was in the course of arranging these
facilities.
BP Chairman Sir Peter Walters said that the group's
investment in Standard was its largest single asset. Full
ownership would enable investment and operating decisions to be
made without the limitations of a minority interest.
BP also believed the acquisition represented the optimum
use of its financial resources. It was confident oil prices
were likely to remain within a range sufficient to justify the
investment.
Walters added that it also felt that, due to management
changes in 1986, Standard could now operate successfully even
in a lower oil price environment.
Standard's net assets at end-1986 were 7.02 billion dlrs
and in the year it reported a loss of 1.08 billion dlrs before
tax and before an extraordinary item of 608 mln dlrs.
Analysts said that the move by BP had come as a surprise.
One noted that it was not immediately clear why the group
should spend so much money buying a company it already
controlled.
BP could also have bought up the remainder of Standard
shares considerably cheaper had it moved six months ago.
It was also unclear what effect the tender would have on
the U.K. Government's recent announcement that it intended to
dispose of its remaining 31.7 pct stake in BP sometime in the
1987/88 financial year, analysts said.
Analyst Paul Spedding of brokers Kleinwort Grieveson noted
that any effect on the government sale of its stake in BP would
depend on the reaction of the markets.
The deal would probably push BP's gearing up to around 59
pct from 20 pct currently, he said.
However, with the likelihood that oil prices would not
repeat last year's rapid drop the prospects for Standard
returning to profitability this year -- and BP benefitting from
its cash flow -- were good.
Standard was a high cost oil producer, the analysts noted.
Spedding noted that it needed about 12 dlrs a barrel to
make money, and at about 15 dlrs a barrel revenue from
production and its downstream activities would push it
comfortably into surplus.
BP initially took a stake in Standard following the
discovery of oil in Alaska's Prudhoe bay in 1969. BP had
inadequate distribution facilities in the U.S. While Standard,
which was strong on marketing and refining, was short on crude
oil.
The analysts said that BP had promoted a major management
reorganisation of Standard in the past year.
The probability that much of the shake-up at Standard was
now complete was one possible factor behind the timing of the
tender offer, Spedding said.
BP's willingness to take hard decisions such as major
balance sheet write offs and the sale of assets had been well
received in the markets.
The lower costs that should now be possible -- especially
after the rationalisation of the loss making minerals division
-- should allow the benefits of an oil price recovery to come
straight through to 1987 profits without being cut back by
other sectors.
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Hoechst AG <HFAG.F> said in a
statement it increased its pretax profits in 1986 despite a
fall in turnover due to lower foreign sales.
The lower sales were due to the fall in the dollar and
other currencies against the mark. Other factors were pressure
on selling prices because of a sharp fall in the prices of
crude oil and petrochemical raw materials and the sale of
polystyrene business in the U.S. And Netherlands.
World group pretax profit rose to 3.21 billion marks in
1986 from 3.16 billion in 1985, with sales falling to 38.01
billion from 42.72 billion.
Within group turnover, foreign sales fell to 27.18 billion
marks in 1986 from 31.92 billion in 1985, a drop of 14.9 pct.
The statement made no mention of net profit figures.
Hoechst will announce its dividend proposal on April 23.
In the first quarter of this year sales were hit by the
cold weather at the start of the year. If the dollar continues
at present low levels, 1987 sales will again be below the
previous year, although in volume terms they are unchanged from
1986, Hoechst said.
Sales of paints and dyes, fibres, sheeting and information
technology all rose in 1986 but plant construction sales fell.
Hoechst attributed its good results to the performance of
the parent company, other units in West Germany, and to
<American Hoechst Corp>.
Improved earnings in the U.S. Largely reflected the
restructuring of styrene and polystyrene activities.
Roussel Uclaf <RUCF.PA> and most domestic non-consolidated
partners did not perform as well as in 1985.
Hoechst attributed the 12 pct rise in parent company pretax
profits to 1.82 billion marks above all to a rise in earnings
from interest and holdings in other companies, and a fall in
extraordinary costs.
The fall in raw material prices was not enough to
compensate for the decline in turnover due to lower prices and
currencies, Hoechst said.
The bulk of the 2.53 billion marks investment in new
projects, up from 294 mln marks in 1985, went on the capital
increase of Hoechst Capital Corp in connection with the
acquisition of <Celanese Corp>.
Celanese was merged with American Hoechst in February to
form <Hoechst Celanese Corp>.
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Australia's largest company, The Broken
Hill Pty Co Ltd <BRKN.S> (BHP), is expected to report a net
profit of around 600 mln to 620 mln dlrs tomorrow for the first
nine months ended February 28, share analysts polled by Reuters
said.
This would be well below the 813.0 mln dlrs earned in the
first three quarters of 1985/86. In the full year ended May 31
1986 the group earned a record 988.2 mln dlrs.
The analysts estimated that the group would report a third
quarter net in the region of 200 mln to 220 mln dlrs, against
238.6 mln a year earlier and 220.3 mln in the second quarter.
BHP's earnings in the first half ended November 30 amounted
to 397.0 mln dlrs, sharply down from 589.3 mln a year earlier.
The analysts predicted that BHP will report an upturn in
petroleum earnings compared with the first quarter, reflecting
some improvement in crude oil prices from the Bass Strait
fields, but these gains would be offset by lower mineral and
steel earnings.
They said the mineral group has been hit by lower coal
prices and shipments to Japan while the steel division has been
affected by industrial and production problems.
The analysts noted that the third quarter is normally BHP's
lowest-earning period owing to a number of seasonal factors,
and they predicted a sharp rise in fourth quarter net to around
300 mln dlrs.
One key factor in the fourth quarter is expected to be a
tax break of some 70 mln dlrs for the investment allowance on
capital expenditure in the steel division, they said.
They said they saw BHP's full year earnings at around 900
mln to 920 mln dlrs. They added that such a decline from
1985/86 would be no surprise, noting BHP has said that it would
be difficult to equal its record 1985/86 net profit.
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Shr 22.9p vs 26.9p.
Interim div 2.6p vs same.
Pre-tax profit 40.0 mln stg vs 38.0 mln.
Net profit before minorities 29.6 mln vs 30.9 mln.
Turnover 825.0 mln vs 791.6 mln.
Trading profit 52.8 mln stg vs 52.5 mln.
Related companies profit 3.1 mln vs 1.4 mln.
Interest payable 12.3 mln vs 14.6 mln.
Reorganisation and redundancy costs 3.6 mln vs 1.3 mln.
Tax 10.4 mln vs 7.1 mln.
Minorities 1.5 mln vs 2.4 mln.
Extraordinary charges 1.3 mln vs 34.2 mln.
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BP International and BP North America
are seeking a five billion dlr, four year syndicated credit
facility in support of British Petroleum Co Plc's tender offer
for the 45 pct of Standard Oil Co it does not already own,
Morgan Guaranty Trust Co of New York said as arranger.
The facility, to be guaranteed by British Petroleum Co Plc
<BP.L> is probably the largest credit facility ever arranged in
Europe, bond analysts said. Full terms will be announced either
later today or tomorrow morning. BP said earlier it planned a
tender offer for the 45 pct of Standard it does not already own
for 70 dlrs a share cash.
The financing being arranged by Morgan Guaranty will take
the form of a fully committed revolving credit. As announced
earlier, BP also is arranging a U.S. Commercial paper program
in connection with the tender and part of the revolver will be
used to support that program.
The exact size of the U.S. Program has not been decided and
the dealers have not yet been chosen.
The credit facility will also allow the borrower to issue
cash advances with maturities of one, three or six months
through a tender panel, which will be comprised of banks
committed to the facility.
Despite the unprecedented size of this euromarket facility,
Morgan Guaranty said that it was being syndicated only among
BP's relationship banks.
As a result, banks were being offered lead manager status
at 200 mln dlrs, co-lead management at 125 mln and manager at
75 mln.
Although pricing on many credit facilities has become
extremely fine in recent years because of the keen competition
to win mandates, Morgan Guaranty said banks would be
compensated fairly since this is a special purpose facility
which must be completed quickly, with signing expected in about
10 days.
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Parent company 1986 net profit 202.55 mln francs vs 171.31
mln
Dividend 13.02 francs vs same, including 4.34 francs tax
credit.
(Note - company earlier reported consolidated net profit
315.9 mln francs vs 302.08 mln and consolidated attributable
profit of 293.3 mln vs 266.6 mln.)
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The Bank of England said it has forecast
a flat position in the money market today.
Among the main factors, maturing assistance and take-up of
treasury bills will drain 545 mln stg and a rise in note
circulation 35 mln stg but the outflow will be offset by 490
mln stg exchequer transactions and bankers balances above
target 70 mln.
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West Germany's current account
surplus widened to a provisional 6.6 billion marks in February
from a slightly downwards revised 4.8 billion in January, a
spokeswoman for the Federal Statistics Office said.
The trade surplus in February widened to a provisional 10.4
billion marks from 7.2 billion in January, she added.
The Statistics Office had originally put the January
current account surplus at 4.9 billion marks.
The February trade surplus was well up on the 6.84 billion
mark surplus posted in the same month of 1986. But the current
account surplus was down slightly from the 6.85 billion surplus
recorded in February 1986.
A Statistics Office statement said the widening of the
February current account surplus compared with January was due
to seasonal factors. Neither the trade nor current account
figures are seasonally adjusted.
February imports, measured in terms of value, totalled
32.11 billion marks, a decline of 10 pct against February 1986
but a rise of 5.5 pct against January.
Exports in February, also in value terms, totalled 42.56
billion marks, 0.5 pct less than in February 1986 but up 13 pct
compared with January.
The Statistics Office said it was not yet able to calculate
the real change in exports and imports in February. But for
comparison purposes it noted that in January the average value
of imports had fallen 15 pct year-on-year while the average
value of exports had declined by only 4.4 pct.
Within the current account, the services account had 300
mln marks deficit, supplementary trade items a 200 mln mark
surplus while transfer payments posted a 3.7 billion mark
deficit.
Taking the first two months of 1987 together, imports in
value terms fell 14 pct to 62.6 billion marks compared with a
year earlier. The value of exports totalled 80.2 billion marks,
a decline of 7.4 pct against the same months of 1986.
The resulting trade surplus of 17.6 billion marks for
January/February compares with a cumulative surplus of 14.1
billion marks in the year-ago period.
The cumulative current account surplus for January and
February 1987 totalled 11.3 billion marks against 11.4 billion
marks a year earlier, the Statistics Office said.
Bank economists said the rise in the February trade surplus
reflected an improvement in the terms of trade as well as
seasonal factors. The Federal Statistics Office said earlier
this week that February import prices fell 0.7 pct against
January while export prices were unchanged.
"The rise in the nominal figures masks a lower export trend
that is not expected to change for several months at least,"
said an economist. He said the nominal trade surplus for 1987
as a whole is likely to fall only slightly from the record
112.2 billion marks in 1986 but other economists said the
surplus could fall to around 80 billion marks.
An economist at the Bank fuer Gemeinwirtschaft (BfG) in
Frankfurt said a two-month comparison of trade figures gave a
more accurate picture of West Germany's trade position.
He noted the 17.6 billion mark surplus for January and
February together was lower than the 21.6 billion mark surplus
posted in November and December.
"The trend is clearly lower," he said.
This economist, who declined to be named, said the February
rise was also partly explained by special factors in January,
when there had been a number of public holidays as well as
extremely cold weather, both of which hindered trade.
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Treasurer Paul Keating forecast
economic growth at slightly under two pct in the financial year
ending June this year, down from the 2.25 pct forecast
contained in the 1986/87 budget delivered last August.
Australia's terms of trade also fell, by 18 pct, over the
past two years, he told Parliament. Terms of trade are the
difference between import and export price indexes.
Despite the figures, the budget forecast of about 1.75 pct
annual growth in employment would be met, Keating said.
Unemployment is currently at 8.2 pct of the workforce.
"This government is dragging Australia through a trading
holocaust the kind of which we have not seen since the Second
World War," Keating said.
"We are not pushing this place into a recession. We are not
only holding our gains on unemployment, we are bringing
unemployment down," he said, adding that the government had help
the country avoid recession.
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Short-dated Saudi riyal interest rates
firmed but other rates were steady in quiet trading, dealers
said.
"Day-to-day money is a bit tighter," one trader said.
Overnight rose two points to six pct, while most quotes for
tomorrow/next and spot/next were 1/2 point higher at around
six, 5-1/2 pct.
The periods were essentially steady at 5-7/8, 5/8 pct for
one month, 6-1/2, 3/8 pct for three, and 6-7/8, 11/16 for six
months.
The spot riyal stood at 3.7500/05 to the dollar after
3.7506/09 yesterday.
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One of two rival firms seeking to enter
Japan's international telecommunications market said it will
offer a stake in the company to 10 foreign firms.
President of <International Telecom Japan Inc> (ITJ), Nobuo
Ito, decline to specify what share the firms would take, but
told Reuters they would not participate in its management.
ITJ and <International Digital Communications Planning Inc>
(IDC), in which both Cable and Wireless Plc <CAWL.L> and
Pacific Telesis Group <PAC.N> own 20 pct stakes, are set to
merge into a new entity to compete against <Kokusai Denshin
Denwa Co Ltd> (KDD).
The Ministry of Posts and Telecommunications has urged the
two rival firms to merge so KDD would have only a single
competitor. The ministry has also rejected foreign management.
Japan's law limits foreign ownership of any new
international telecommunications entrant to 33 pct, so C and
W's and Pacific's stakes could be three pct in the merged firm,
sources said. Those seeking to join are General Electric Co
<GE.N>, Ford Motor Co <F.N>, <Citibank NA>, BankAmerica Corp
<BAC.NYSE>, <Shearson Lehman Bros Inc>, <Saloman Brothers>,
<Asia Boeing Computer Service>, Unisys Corp <UIS.N>, <Societe
Generale> and Deutsche Bank AG <DBKG.FRA>.
The merger plan has been criticised for excluding foreign
firms from a meaningful position in the market.
The U.K.'s Prime Minister Margaret Thatcher, U.S. Secretary
of State George Shultz, U.S. Commerce Secretary Malcolm
Baldrige and U.S. Trade Representative Clayton Yeutter have all
expressed such opposition.
Japanese Prime Minister Yasuhiro Nakasone will draft a
reply to the criticism following further discussion, a Posts
and Ministry official said.
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World group turnover of Siemens AG
<SIEG.F> should rise to 51 or 52 billion marks in the current
year to September 31 after a 19 pct upturn in the first five
months, management board chairman Karlheinz Kaske said.
Siemens reported world group turnover in 1985/86 of 47.02
billion marks.
Kaske told the annual shareholders meeting turnover rose to
21.2 billion marks in the first five months of 1986/87, about
19 pct above the same year-ago period. The rise was mainly due
to payment in January for a West German nuclear power station
which led to a jump in domestic sales of 36 pct.
In the first five 1986/87 months, turnover abroad showed a
three pct increase, Kaske said, without giving figures.
In the same period incoming orders rose five pct to 21.8
billion marks against the same 1985/86 period.
For the year as a whole incoming orders should rise between
one and two billion marks to around 51 or 52 billion.
Apart from payments for the nuclear power station, the
communications and telecommunications sectors in particular
should contribute to growth this year, Kaske said.
But it was not possible to make a profit forecast for
1986/87 because of uncertainty about the direction of the
dollar, Kaske said.
Siemens already reported that first quarter 1986/87 group
net profit fell marginally to 296 mln marks from 298 mln in the
same period in the previous year.
Turnover in the first five months rose particularly
strongly in the installations and automotive technology,
communications and telecommunications sectors, but components
and energy and automation showed a sharp decline.
Kaske said domestic orders rose to 10.2 billion marks in
the first five months of this year, or nine pct above their
level in the same 1985/86 period, boosted in particular by
orders for the fully owned Kraftwerk Union AG subsidiary.
Foreign orders grew one pct to 11.6 billion marks. An
increase in orders through newly acquired subsidiaries abroad
was balanced by the decline in the dollar.
While the installations and automotive technology sector
showed a sharp rise in orders, energy and automation and
communications orders were below the level achieved in the same
period of 1985/86.
Telecommunications orders remained at roughly the same
level.
Kaske said investments were expected to remain around six
billion marks in 1986/87 after a 50 pct increase the previous
year. Research and development were likely to rise 13 pct to
6.1 billion marks or around 12 pct of turnover.
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The Fried. Krupp GmbH
<KRPG.D> steel and engineering group said it had a satisfactory
1986 despite a provisional 12 pct fall in total group sales to
18.1 billion marks from 20.7 billion the previous year.
Third party turnover declined to 15.9 billion from 18.5
billion in 1985 while orders slipped to 15.5 billion marks from
16.9 billion, it said in a preliminary statement.
Despite these figures, which reflected the dollar's
weakness against the mark and oil and raw materials price
falls, it said 1986 was a satisfactory year.
The reason was the continued expansion of the machinery and
plant sector, which accounted for 42 pct of total sales.
Krupp added that some areas of the mechanical engineering
business achieved notable growth rates and acquisitions had
underpinned machinery and component activities.
An orders decline in the steel and, in particular, the
trading and services sectors, affected the group's total order
figures.
However, "all business sectors contributed to the positive
results achieved in 1986," Krupp added, without giving details.
Domestic orders decreased by five pct to 9.6 billion marks
from the previous year and foreign orders fell 14 pct to 5.9
billion, it said. Foreign business accounted for 38 pct of
orders against 40 pct in 1985.
Orders received by the machinery and plant sector, 11
member companies which comprise the core area of the group,
rose by four mln marks last year to 6.9 billion, Krupp said.
The group's orders in hand amounted to 9.1 billion marks at
end-December 1986 from 10.3 billion at the start of the year.
Orders received by the steel sector last year decreased by
three pct to 6.2 billion marks from 1985, it said.
The steel market weakened increasingly over the year,
mainly because of exchange rate movements, the deterioration in
foreign trade and a downturn in a number of customer
industries.
The difficult market for sections and flats of quality
steel depressed order tonnages by around seven pct, Krupp said.
But special steel boosted by strong demand for stainless
cold-rolled flats, grew by five pct in tonnage terms.
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Firms need not be pessimistic about export
prospects even though foreign markets have become more
difficult because of the mark's strength the Economics Ministry
said.
The ministry's parliamentary state secretary Ludolf Georg
von Wartenberg, told a business conference German exports could
start rising again in real terms during 1987, reversing the
lower export trend which emerged in mid-1986.
But even if the turnaround did not occur, there would be no
need to worry about the economy as long as the weakness of
exports did not affect currently good domestic demand.
Von Wartenberg said consumer demand remained quite good but
noted there had been a cooling in the investment climate. "This
is certainly a reason for heightened watchfulness but not for
stimulative steps," he said.
The best way for Bonn to help its exporters is to work
actively to promote free world trade, he added.
Von Wartenberg said the economy still had good export
opportunities. Price alone was not the only factor in
international competitiveness, he said, adding German firms
have a reputation for high quality standards, prompt delivery
times and good service.
Von Wartenberg said the government was in a difficult
position on its trade figures. It faced international pressure
to reduce its trade surplus, but West Germans were worried
about the effect of the mark's strength on the country's
exporters.
Reports about the trade surplus, especially overseas,
tended to concentrate on nominal trade figures, which rose to a
record 112.2 billion marks in 1986, he said. But this rise was
due entirely to the lower value of imports caused by the
decline of both the dollar and oil prices. German exports have
in fact been falling in real terms for sometime, he said.
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The monetary authorities of the major
industrialised countries lost their credibility this week as
the dollar was sold off despite pleas from ministers and
widespread central bank intervention, dealers said.
The dollar's fall below 150 yen, which follows last month's
Paris currency stabilisation agreement by the U.S., Japan, West
Germany, Britain, France and Canada, is a dramatic reversal of
the success of the Group of Five (G-5) 1985 New York Plaza
meeting to weaken the dollar, they said.
The G-5 and the market agreed in 1985 that the dollar was
overvalued but this time the market and the authorities are on
different sides, dealers said.
Apparent confusion in the ranks of the G-5 nations has
encouraged the market to challenge the authorities despite
concerted intervention by the central banks of the United
States, Japan, Britain and West Germany, they said.
Pleas by Japanese Finance Minister Kiichi Miyazawa for
action to stabilise the dollar were matched over the weekend by
comments by U.S. Treasury Secretary James Baker that there was
no target zone for the dollar. The dollar was sold anyway.
Yesterday's comment by Baker that he stood by the Paris
accord did nothing to reverse sentiment, dealers said.
The intervention, backed by remarks by Fed Chairman Paul
Volcker and Japanese central bank governor Satoshi Sumita,
which a few months ago would have brought the dollar fall to a
halt, has done little but slow the rate of its decline, they
noted.
The situation has again raised the question of whether
intervention can succeed against the trend in today's huge
currency markets. Dealers said the market's cool response to
intervention reflected a basic oversupply of dollars.
"This means that the current dollar selling is not of a
sheer speculative nature but backed by real demand," said Koichi
Miyazaki, deputy general manager at Sanwa Bank.
Dealers said the dollar will remain weak despite the
intervention and it is only a matter of time before some
operators try to push it below 148 yen. The dollar closed in
Tokyo today at 149.40 against New York's 149.30/40. Its record
low was 148.40 in Tokyo last Tuesday.
Dealers said the dollar will gain only temporary support to
rise above 150 yen toward early April when the Group of Seven
industrial nations meets to discuss currencies again.
The market expects the seven nations (the Paris six plus
Italy) to try to agree on another way to stabilise currencies
apart from intervention, a chief dealer at a U.S. Bank said.
Dealers said they were unsure what other methods could be
used and they are sceptical anyway about how long the Paris
accord nations, particulary the U.S., Will remain willing to
prevent a further dollar fall given the continuing high U.S.
Trade deficit, especially with Japan.
Further pressure from a protectionist U.S. Congress for a
lower dollar is also limiting Washington's options, they said.
The market now thinks the central bank action is to slow
the dollar fall, not to push it back over 150 yen, said
Tadahiko Nashimoto, manager at Long Term Credit Bank of Japan.
Another bearish factor for the dollar is expected large
forward dollar sales from April to June for export bills
falling due for Japanese exporters from April to September.
The exporters had delayed in expectation of a further yen
depreciation, dealers said.
Yesterday's request to 30 trading houses by the Ministry of
International Trade and Industry to restrict dollar sales looks
ineffective in light of this real demand, they said.
The market is also anticipating active institutional dollar
sales to hedge currency risks on bond holdings from the new
business year starting April 1, dealers said.
"The market seems to have established a new dollar trading
range between 147 and 149 yen," one dealer said.
The dollar traded between 151 and 153 yen after the Paris
accord on February 22 and 150 yen was then considered the low
end for the dollar against the yen, he said.
Some dealers now believe that if the dollar falls below 148
yen, it will pick up renewed downward momentum and slide to
145.
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Britain's visible trade deficit narrowed
to a seasonally adjusted provisional 224 mln stg in February
from 527 mln in January, The Trade and Industry Department
said.
The current account balance of payments in February showed
a seasonally adjusted provisional surplus of 376 mln stg
compared with a surplus of 73 mln in January.
Invisibles in February were put provisionally at a 600 mln
surplus, the same as in January.
Seasonally adjusted, imports rose in February to 7.16
billion stg from 6.73 billion in January. Exports rose to a
record 6.93 billion last month from 6.20 billion in January.
Trade Department officials said the improvement in
Britain's current account contrasted with most private
forecasts and they attributed much of the strength to imports
rising less quickly in February than might otherwise have been
expected.
The Department said exceptionally cold weather in January
reduced exports that month and that there had been an element
of catching up in the February figures.
The seasonally adjusted volume index, base 1980, a guide to
underlying non-oil trade, showed exports rising to 131.0 from
114.6 in January and imports rising to 142.2 from 136.5.
The value of British oil exports in February rose to 751
mln stg from 723 mln in Jnauary while oil imports rose to 425
mln from 352 mln.
The Department said the upward trend in non-oil export
volume continues and the underlying level of non-oil import
volume seems to have stablised.
The Departnment said exports to the U.S. May be benefiting
from fluctuations in the mark and yen exchange rates.
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Lucas Industries Plc <LUCS.L> said its
underlying performance would continue to improve in the second
half but profits would be restrained by low activity in U.K.
Commercial vehicle and tractor markets as well as in North
American electronics.
The company earlier reported a two mln stg rise in pretax
profit to 40 mln in the six months to end-January. The figure
was some five mln below forecasts and Lucas shares dropped
sharply to 557.5p at 1130 GMT from last night's close of 590p.
It said it would continue with plans for all its activities
to be internationally competitive and profitable.
Costs of restructuring, reorganisation, employee training
and retraining, particularly in the UK automotive businesses,
together with high research and development spending would
affect profits in the short term.
But Lucas said it was exploiting growth opportunities in
automotive markets, especially in vehicle breaking and engine
management systems. Recent acquisitions in North America had
strengthened Lucas Aerospace and Lucas Industrial systems.
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Bank of Japan Governor Satoshi Sumita
said it is in Japan's national interest to make greater efforts
to reduce its trade surplus.
He told business executives the most important issues for
the world economy are the correction of international trade
imbalances and a solution to the world debt problem.
To this end, Japan and the U.S. Must make medium- and
long-term efforts to alter economic structures which have
expanded the trade gap between the two nations. World economic
growth and therefore an expansion of debtor countries' export
markets are needed to solve the debt issue, he added.
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The Commerce Commission has approved
a proposed merger between <Progressive Enterprises Ltd> and
<Rainbow Corp Ltd>, Rainbow said in a statement.
The merger involves the formation of a new company <Astral
Pacific Corp Ltd> which will acquire all shares in both
companies on a one-for-one share exchange basis.
Rainbow earlier this week lifted its stake in Progressive
to 52 pct from 44 pct. The statement said a new private
company, <Transcapital Corp Ltd>, fully owned by Rainbow
directors Craig Heatley, Gary Lane and Ken Wikeley, will
purchase this stake for an undisclosed cash sum.
The Commission has also approved Transcapital acquiring up
to 45 pct of Astral Pacific, Rainbow said.
<Brierley Investments Ltd>, which has been a frequent
critic of the merger, launched a full bid for Progressive at
4.20 N.Z. Dlrs a share last Monday.
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The Bank of England said it revised its
estimate of today's money market shortfall to around 350 mln
stg from a flat position.
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