P.M. Executive Briefing - Jan. 26
This Afternoon's Headlines:
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Consolidated Freightways Misses Wall Street Forecast
Consolidated Freightways said its net loss for the fourth quarter was $11.3 million, or 52 cents per share, below the 45-cent per-share loss projected in a First Call/Thomson Financial poll. CF saw a $2.6 million (12 cents per share) profit in the year-earlier quarter. Service-improvement implementation and expenses for handling more light, bulky freight were among the causes cited for the quarterly loss.For the full year, the company saw $2.7 million (12 cents per share) in consolidated net income, down from the $26.3 million ($1.16 per share) 1998 profit. The company, which is seeking a permanent CEO, tapped G. Robert Evans to take W. Roger Curry's place as interim CEO. Reuters (01/26/00)
Northern Opposition Mounts to Burlington-Canadian Rail Merger
While the proposed Burlington Northern Santa Fe/Canadian National Railway merger has already come under criticism from U.S. customers concerned about lessened competition, it has fared better in Canada, with apparent support from the prime minister and transport minister. However, opposition is gaining in western Canada, where it is worried that British Columbia ports will suffer if trans-Pacific shipments start going through U.S. ports served by BNSF due to shorter ocean routes.The western parliamentary caucus of Canada's governing Liberal Party has put together a group looking into the possibility of reduced competition. In the eastern United States, similarly, railroads and ports are concerned that shipments from Europe will go through Halifax, Nova Scotia, which is served by CN.
Last week, the Chemical Manufacturers Association came out against the merger. Should the merger be approved, the association will recommend that competing railroads be allowed to serve customers of the merged entity in the United States if they are served by no other railroad. There is also concern that other mergers could result if BNSF and CN are joined; Canadian Pacific Railroad recently said it has not ruled out a merger. Wall Street Journal (01/26/00) P. A4; Beltrame, Julian; Machalaba, Daniel; Chipello, Christopher J.
Bill Proposed to Slow Trucks Down
Missouri State Sen. Wayne Goode has proposed cutting trucks' speed limit to 5 mph below the 70 mph limit for cars in the state. The number of trucks in fatal crashes increased to 155 from 93 in three years after the speed limit was raised from 55 mph in 1995, he said. The State Highway Patrol is backing Goode's bill. MSNBC Online (01/26/00)Eaton Earnings Beat Wall Street Forecasts
Eaton said its April acquisition of Aeroquip-Vickers along with a booming truck market in North America boosted its fourth-quarter earnings per share before special items to $1.59, beating a First Call/Thomson Financial poll by 6 cents. The fourth-quarter EPS was 25% higher than the year-earlier figure."If anything, the truck components market was too strong, and we were challenged to meet surging North American demand," said Chairman and CEO Stephen Hardis. The Cleveland-based maker of engineered products said it saw $119 million in profit before nonrecurring items, compared with $91 million in 1998's fourth quarter, on revenue of $2.21 billion, up 28%. Reuters (01/26/00)
Students Learn How to Make Big Rigs Run
North Mecklenburg High School in Mecklenburg County, N.C., is offering a class in heavy equipment and diesel technology to prepare students for jobs as diesel technicians.The business group N.C. Industries for Technical Education is coordinating the program, which it started a few years back after realizing that there were not enough people going into that field. NCITE members offer scholarships to some of the students to get a two-year technician's certificate. One other high school in North Carolina, a Greensboro vo-tech, is also offering the program. The teacher at North Mecklenburg, Richard Deas, helped put together the curriculum for both schools. Charlotte Observer (01/25/00) P. 1B; Smith, Celeste
Research Alert - Heartland Express Upped to Buy
Heartland Express, which reported earnings and revenues gains for the fourth quarter, has been given a buy rating by Deutsche Banc Alex Brown, which upgraded the Iowa carrier from market perform. Reuters (01/25/00)6-Mile Spur of M-63 Is in Works
The Michigan Transportation Department will be adding more truck parking and changeable message signs at the Blue Water Bridge Plaza as part of its five-year plan.Another project, the completion of the M-53 Romeo bypass, will turn six miles of M-53 into a limited-access, grade-separated highway and double the road from two to four lanes in the fast-growing townships of Washington and Bruce in northern Macomb County.
The five-year plan will also complete the Haggerty Connector in Oakland County, which is effectively an Interstate 275 extension. Other projects will build the M-5 boulevard in Oakland County between 14 Mile and Pontiac Trail, add a northbound I-75 lane in the same county, and rebuild I-75/I-96 north of Detroit's Ambassador Bridge.
About 10% of the $6.4 billion plan involves building new roads, while the rest will repair or rebuild 1,400 bridges and 6,625 miles of highway. Detroit Free Press (01/25/00) P. 1A; Gerritt, Jeff
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