In brief
Starwood Hotels tallies Japan damage
Starwood Hotels & Resorts Worldwide Inc. recorded a $33 million charge in the first quarter to account for earthquake damage sustained by a Japan hotel in which it holds a minority investment.
Starwood Hotels is readying to move its corporate headquarters to Stamford early next year from its current base at White Plains, N.Y.
In a late-April conference call, CFO Vasant Prabhu said Starwood had written off its equity investment in the Sheraton Grand Tokyo Bay Hotel.
“Travel into Japan is down significantly, resulting in large occupancy and rate shortfalls at all hotels,” said Prabhu. “With a nation in mourning, events and spending on events like weddings is down very sharply and unlikely to recover soon, hurting food and beverage, which is over 50 percent of Japanese hotel revenues. The Sheraton Grand Tokyo Bay is particularly hard hit, as Tokyo Disneyland was shut; and while it is now open, we do not expect a recovery to normal levels anytime soon.”
The charge helped depress Starwood”™s first-quarter profits slightly to $28 million, as revenue rose 9 percent to just short of $1.3 billion. In North America, Starwood”™s average revenue per available room ”“ the industry”™s yardstick ”“ was up 11 percent from a year ago.
During the quarter, the company opened 21 hotels and resorts, including taking over management of the Liberty Hotel in Boston, at the site of the former Charles Street Jail. The company removed another 11 hotels from its books during the first three months of the year.
W.R. Berkley sees revenue, rates rise
W.R. Berkley Corp. raised its average prices for the first time in more than four years as the insurance carrier assesses the impact of the Japan earthquake and tsunami, the freak outbreak of killer tornadoes in the Southeast U.S. and the prospect of flooding as the Mississippi River crests at historic highs.
W.R. Berkley profits fell slightly in the first quarter to $116 million, even as revenue rose 7 percent to $1.2 billion.
“Recent events as well as revisions to catastrophe modeling tools are changing the way people view catastrophe exposures,” said William Berkley, CEO of Greenwich-based W.R. Berkley, in a prepared statement. “We are beginning to see material rate increases not just limited to catastrophe business, but also in a number of other lines of business.”
Praxair gains from recovery in U.S. manufacturing
Sales for Danbury-based Praxair Inc. heated up 11 percent in the first quarter from a year earlier to $2.7 billion and the company”™s $398 million profit was up 17 percent.
Praxair sells gases used in a wide range of settings, including factories, hospitals and kitchens.
In North America, first-quarter sales were $1.3 billion, up 8 percent from the prior-year quarter.
In a conference call with investment analysts, CFO James Sawyer said U.S. manufacturing is seeing growth both at major conglomerates like Fairfield-based General Electric Co., and relatively small machinists that supply them parts.
“Aerospace is beginning to recover,” Sawyer said. “As deliveries finally materialize on the Boeing 787 using GE GEnx engines, we expect our electron beam vapor deposition business to pick up.”
During the quarter, Praxair reached an agreement to sell Lake Forest, Calif.-based Apria Healthcare Inc. its U.S. business that supplies oxygen and equipment for patients in their homes. The unit employs 1,100 people; Apria estimated it would produce at least $85 million in revenue over the final nine months of 2011.
Also, Praxair announced plans to double the size of a plant in Memphis, Tenn., to supply Nucor Corp. and Valero Energy Corp. and said it would build a new plant in Argentina, which it says has been a fast growth market.
Navy doubles Virginia-class sub production
The U.S. Navy released $1.2 billion for the construction of an attack submarine at General Dynamics Electric Boat in Groton, marking the commencement of construction of two submarines annually under the Virginia-class program.
That doubles the program”™s previous pace, which Electric Boat credited both to efforts by Connecticut”™s congressional delegation, as well as its own cost-cutting efforts.
Electric Boat last received funds for two submarines in 1991, when the Navy ordered the U.S.S. Connecticut and the U.S.S. Louisiana.
BI launches Hepatitis C trial
Boehringer Ingelheim Pharmaceuticals Inc. enrolled its first patient in a phase 3 clinical trial for a hepatitis C drug candidate, with results expected within two years on tests that could eventually include nearly 1,900 patients worldwide.
Some 17,000 U.S. residents are afflicted with hepatitis C, which attacks the liver. Immediate symptoms can include fatigue, nausea and joint pain and the disease can lead to cirrhosis and liver cancer, according to the Centers for Disease Control and Prevention.
Germany-based Boehringer Ingelheim has its U.S. headquarters in Ridgefield. The company has yet to state where it plans to manufacture any hepatitis C drug it might eventually sell.
The U.S. Food and Drug Administration granted FDA Fast Track designation for the drug candidate, which is reserved for speeding the development of drugs to treat serious diseases and fill an unmet medical need.
Harman International peddles patents
Even as it marks the passing of its founder, Harman International Industries Inc. is sorting through its massive patent portfolio for technologies it might license to other companies for development into products.
Stamford-based Harman International sells stereo equipment and auto infotainment systems. Founder Sidney Harman died April 12 in Washington, D.C., of complications from cancer.
Harman International sales rose 13 percent from a year ago to $948 million in the company”™s third fiscal quarter ending March 31, and Harman earned $43 million from continuing operations.
In a conference call in late April, CEO Dinesh Paliwal said the company registered a $60 million gain in the quarter from the sale of patent rights.
“We have more than 3,500 patents,” Paliwal said. “We had in the past never actually thought that we could monetize some of that, and that could be very interesting for us as we continue to develop.”
Harman indicated it expects to open in July a new factory in China that will be its largest at 460,000 square feet and its most technically advanced. As part of a restructuring launched in 2008, Harman has closed or consolidated 16 facilities and eliminated 2,250 jobs.
Waterbury company moves to Westchester
AmkaiSolutions L.L.C., an electronic medical records company in Waterbury, said it took more than $400,000 dollars in incentives to move to Armonk, N.Y.
The company has 35 workers and plans to add up to 100 more.
“Today”™s announcement shows that the singular blend of talent, resources and support that New York offers to businesses will continue to attract companies to our state,” said Gov. Andrew Cuomo, in a prepared statement. “I commend AmkaiSolutions for their investment in New York and for joining a growing community of high-tech industries in the Hudson Valley.”
Emcor books gain, acquires Bahnson
In the first quarter, Emcor Group Inc. sales rose 8 percent from a year ago to $1.3 billion and the company earned $24.6 million.
Norwalk-based Emcor builds and manages electrical and mechanical systems on behalf of facility owners, with Saint Vincent”™s Medical Center in Bridgeport among its recent clients.
In February, Emcor acquired Bahnson Holdings Inc., a Winston Salem, N.C.-based company previously known as Luwa Inc., with $155 million in revenue last year. Emcor has yet to disclose what it paid for Bahnson, saying it was an immaterial amount.
Curtain Call takes bow
Under new Connecticut tourism commissioner and Stamford resident Kip Bergstrom, the city”™s Curtain Call theatrical company was named one of four recipients of the 2011 Governor”™s Awards for Excellence in Culture and Tourism.
Curtain Call just wrapped an April run of “Titanic, The Musical,” and is readying for a June run of “A Chorus Line.”
Other Governor”™s Awards winners include actor Keir Dullea, best known for playing astronaut David Bowman in “2001: A Space Odyssey,” Lyman Orchards in Middlefield for its agri-tourism programs and Al Marder, an advocate for the Connecticut Freedom Trail.
Westfield Trumbull fitted out for J. Crew
J. Crew is opening a store at the Westfield Trumbull mall this fall, its sixth location in Fairfield County along with stores in Greenwich, Stamford, New Canaan, Westport and Danbury.
Westfield Trumbull is also readying for the arrival of H&M, 77kids and L.A. Fitness.
Hexcel sales strengthen on Boeing 787
Hexcel revenue gained altitude in the first quarter, as Boeing Co. and Airbus pushed ahead on several new aircraft that use Hexcel composites, including the Boeing B787 and the Airbus A380.
Stamford-based Hexcel sells carbon fiber and composite materials for use in varying industrial applications, from aerospace parts and wind turbine blades to adhesives. Sales accelerated 26 percent from a year ago to $332 million in the first quarter, pushing the company”™s profits up by two-thirds to $26.4 million.
Hexcel said the Japan crisis has yet to have any significant impact on its business, from the perspective of either customers or suppliers.
Insider trading pleas entered
Westport resident Craig Drimal pleaded guilty to making $6 million by executing trades using illegal insider tips on acquisitions, with prosecutors saying he misappropriated information from the law firm Ropes & Gray.
Drimal, 54, is scheduled to be sentenced in September. He faces up to 20 years in prison for each of the five securities counts to which he pleaded guilty and up to $5 million in fines on each count.
Separately, a onetime junior portfolio manager with SAC Capital pleaded guilty to insider trading charges and concealing evidence as part of the continuing prosecution of Galleon Group.
Donald Longueuil pleaded guilty to committing securities and wire fraud while working at Stamford-based SAC, which has not been charged and has stated it is cooperating with investigators. Longueuil is forfeiting nearly $1.3 million and could face more than $5 million in fines and up to 25 years in prison.