September's sales of previously owned homes climbed 3.1 percent from August to reach the third-highest level on record, the National Association of Realtors said. The month's seasonally adjusted annual rate of 6.75 million homes topped analysts' estimates by some 200,000 units and followed two straight months of decline. Most experts attribute the sales growth to continued low mortgage rates. In September, the average rate on a 30-year mortgage was 5.75 percent, down from 5.87 percent in August and 6.15 percent in September 2003.
Venture Capital Investment Slows
Venture capital investing slowed nationally last quarter, as firms invested $4.3 billion in 601 companies in the three months ended Sept. 30, down from $5.9 billion in the second quarter and matching third-quarter 2003, according to the quarterly MoneyTree Survey by PricewaterhouseCoopers, Thomson Venture Economics and the National Venture Capital Association. In the Washington area, venture capital investments rose to $156 million, from $132.4 million the previous quarter. Still, the number of deals fell to 31 from 43.
Electronic Data Systems, which employs about 5,000 people in the Washington area, delayed the release of its third-quarter financial results until Nov. 3 to let auditors complete their evaluation of a money-losing Navy computer-services contract. EDS, based in Plano, Tex., said it was considering writing down assets related to the Navy deal. Last month, EDS said it might cut as many as 20,000 jobs.
The Army should trust Boeing to ethically manage its high-tech modernization program but maintain strict oversight to ensure proper development of the $100 billion project over the next 20 years, according to a report by the Institute for Defense Analyses. "The Army should adopt a policy of 'Trust but Verify' with regard to the ethics programs of the . . . participants," said the report, which aimed to identify weaknesses in the program's procedures, policies or practices.
Delta Air Lines obtained as much as $600 million in new financing from American Express Travel Related Services as the Atlanta-based carrier scrambled to avoid filing for bankruptcy protection. Up to $100 million of the financing will be a loan and the balance will be a prepayment to SkyMiles, Delta's frequent flier program. Some of the financing would be credited against SkyMiles purchases to be made by American Express.
DuPont was ordered by a federal jury to pay $1.29 million to a disabled worker in Louisiana who was fired because of back problems. The woman said she was forced out of her job after 18 years in a laboratory and as a secretary because she walks slowly with a limp and has limited ability to lift things. DuPont officials said she was a "threat" because of her inability to safely evacuate from the site in an emergency.
T-bill rates rose. The Treasury Department sold $21 billion in three-month bills at a 1.855 percent discount rate, up from 1.770 percent last week, and $19 billion in six-month bills at 2.040 percent, up from 1.990 percent. The actual return to investors is 1.890 percent for three-month bills, with a $10,000 bill selling for $9,953.11, and 2.090 percent for a six-month bill selling for $9,896.87.
Citigroup was censured and fined $250,000 for distributing marketing literature that allegedly included misleading information about its hedge funds. Securities regulator NASD, formerly known as the National Association of Securities Dealers, said the materials included target return rates for Citibank's hedge funds but did not explain how those goals would be reached.
Adelphia Communications signed a confidentiality agreement with Time Warner and Comcast that allows the two companies to make a joint bid for Adelphia's assets. More than 40 such agreements have been signed.
Elan, Ireland's biggest drugmaker, said it will pay $75 million to settle a class-action lawsuit and $15 million to resolve a U.S. Securities and Exchange commission probe into the company's accounting. In the settlement with shareholders, $35 million of the cost will be covered by insurance, the Dublin company said.
Coventry Health Care said its chief operating officer, Thomas McDonough, will become president when Allen Wise retires on Jan. 1. Dale Wolf was previously named Wise's successor as chief executive of the Bethesda managed health care company. Coventry also said that Shawn Guertin, its senior vice president of finance, will become chief financial officer on Jan. 1.
Corporate Executive Board, a District firm that advises companies on best practices, earned $12 million (30 cents a share) on $72.4 million in revenue during its third quarter ended Sept. 30, up from a profit of $5.5 million (14 cents) on $53.8 million in revenue during the corresponding quarter a year ago. Shares closed up 30 cents, at $58.88.
Trex of Winchester reported a profit of $7.1 million (48 cents a share) for the third quarter ended Sept. 30 on sales of $64.4 million. That compares with a profit of $5.1 million (35 cents) on sales of $41.2 million in the same quarter a year ago.
American Express said third-quarter earnings climbed 14 percent from the same period last year, to $879 million, as income from travel-related services increased 20 percent and profit at its bank rose by 18 percent. Revenue increased 12 percent, to $7.2 billion.
Hilton Hotels posted a 79 percent jump in third-quarter profit on summer travel and higher room rates. The Beverly Hills, Calif., company earned $61 million for the quarter, compared with $34 million during the corresponding period a year ago. Revenue rose 9 percent, to $1.03 billion.
Kimberly-Clark said third-quarter earnings rose 5 percent despite price competition in its key diaper market. The maker of Kleenex and Huggies said it earned $441.3 million during the quarter, compared with $419.7 million during the same period a year earlier. Revenue was $3.87 billion, compared with $3.64 billion.
BellSouth said its third-quarter profit fell 14.6 percent, to $799 million from $936 million in the same period last year, partly due to the cost of repairing hurricane-damaged phone lines in Florida. It took a $38 million charge in the quarter for the repairs and said it will take a $90 million charge in the fourth quarter. Revenue fell to $5.1 billion from $5.14 billion.
Reynolds American posted a third-quarter profit of $339 million, compared with a loss of $3.5 billion during the same period a year ago. Revenue rose to $1.87 billion from $1.38 billion.
Kellogg said third-quarter profit rose 6.8 percent on sales of new cereals and snacks with reduced carbohydrates and sugar. Net income at the largest U.S. cereal maker was $247 million, compared with $231.3 million during the same period a year earlier. Sales climbed to $2.45 billion from $2.28 billion.
Pitney Bowes said third-quarter profit rose to $136.5 million, compared with $118.5 million in the same period last year, on strong domestic sales and a growing international market. Revenue rose to $1.2 billion, over third-quarter 2003.
Compiled from reports by the Associated Press, Bloomberg News, Dow Jones News Service and Washington Post staff writers.