March 12, 2010

Briefcase

— L.L. Bean to freeze wages as sales tumble in 2008

L.L. Bean is freezing all wages and salaries for its 5,500 employees for the coming year due to slumping sales.

The wage freeze will go into effect during the company's next budget period which starts in March. Company spokeswoman Carolyn Beem said the move eliminates the need to reduce 75 to 100 positions.

The company is also offering early retirement incentives to all employees who are 55 or older and have been with the company for five or more years. The program will be offered at the end of February through early April.

Company officials will determine whether layoffs will be necessary based in part on how many people opt for early retirement.

Holiday sales were down 10 percent from the year before for the Freeport-based national retailer. The company expects 2008 sales will close lower than 2007, but the final figures are not yet available.

The company does not forecast a turnaround until 2010, Beem said.

Beem called the wage freeze and retirement incentive rare events.

Citigroup says Parsons will take over as chairman

Citigroup Inc. said Wednesday that board member Richard Parsons — the former CEO of Time Warner — will be taking over as chairman.

Parsons succeeds Win Bischoff, who became chairman in December 2007 after the company let go of its embattled CEO and chairman at the time, Charles Prince. The move is effective Feb. 23.

Bischoff is not putting himself up for re-election at the board's annual meeting this spring, and will retire later this year, Citigroup said.

Intel consolidation to cut up to 6,000 jobs globally

Intel Corp. said Wednesday it is consolidating its manufacturing operations as a part of a restructuring bid that will affect thousands of jobs from the U.S. to the Philippines.

Between 5,000 and 6,000 employees will be affected, though some may be offered posts at other facilities, the company said.

The world's largest chip maker is closing two assembly test facilities in Penang, Malaysia and one in Cavite, Philippines and will halt production at a plant in Hillsboro, Ore. It will also end wafer production at a facility in Santa Clara, Calif. All five are older factories, the company said.

Airlines hurt as oil rises, advance bookings fall

The major U.S. airlines have grounded aircraft and eliminated flights, but those moves might not be enough in the face of a recession that is choking demand for air travel. Their struggles, however, could be working to the benefit of consumers.

Carriers American Airlines and United Airlines said Wednesday that they lost more money in the fourth quarter. United parent UAL Corp. lost $1.3 billion, hurt by a wrong bet on the direction of oil prices. The company plans to cut 1,000 more jobs.

Airline stocks tumbled, pushed lower by a bump in oil prices.

Shares of American parent AMR Corp. plunged $2.48, or 23.7 percent, to $7.98, as airline officials said advance bookings were weak, especially for March. UAL shares sank 71 cents or 6.1 percent, to $10.91.

eBay earnings plummet 31 percent; shares also fall

Quarterly earnings fell 31 percent at eBay Inc., indicating that its Internet auctions are being hurt by the recession just like traditional retail sales. The results, combined with a forecast below analysts' expectations, sent eBay shares skidding nearly 6 percent.

San Jose, Calif.-based eBay said Wednesday it earned $367 million, or 29 cents per share, in the quarter. That fell from $531 million, or 39 cents per share, in the year-ago quarter.

Excluding one-time items in the most recent period, eBay earned 41 cents per share -- 2 cents higher than the prediction of analysts.

-- From staff and news services

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