MTR Gaming Group Inc. CEO Edson "Ted" Arneault said the company's flagship Mountaineer Race Track & Gaming Resort is suffering from the introduction of video lottery machines popping up in bars and social halls around West Virginia as the company reported lower second- quarter earnings. Arneault, whose Chester, W.Va.-based company owns a license to build a racetrack and slots parlor in Erie and is seeking to partner with groups pursuing the license to build a stand-alone slots parlor in Pittsburgh, also failed in the West Virginia legislature's latest session to win approval of expanding gambling in that state to include table games such as blackjack, roulette and craps. He said during a conference call with stock analysts that Mountaineer needs table games to attract younger gamblers once the Pennsylvania Gaming Board begins awarding licenses for slot machines by the end of next year or early 2007. Net income fell to $1.6 million, or 6 cents per diluted share, from $3 million, or 10 cents per share, in the year-ago period. Revenues rose 18 percent to $98 million, from $83 million in the year-ago period, due to the inclusion of Binion's revenue for the full quarter this year, compared with only a small portion of the quarter in the year-ago period.
Ariba reports $289 million loss
Ariba Inc. reported a third-quarter net loss of $289 million, or $4.52 per diluted share, compared with a net loss of $7.6 million, or 17 cents per share, in the year-ago period. The loss was driven by a $248 million charge to write off goodwill related to the acquisition last year of FreeMarkets Inc., in addition to $34.6 million in restructuring and integration costs and other one-time costs. Revenue of $77 million compared with $53 million in the year-ago period, which did not include FreeMarkets results.
Weirton shutdown to affect 2,000
Most of the 2,000 steelworkers and management at the Mittal Steel-USA, Weirton operations will be off work because of a plantwide shutdown. While production will cease during the scheduled shutdown, the Independent Steelworkers Union said approximately 125 workers will remain on the job for fire-watch duties throughout the mill. The Steelworkers Union said almost 700 of its members remain on short-term layoff status. Some of those laid-off workers are on a five-week furlough cycle, while others are on a 10-week cycle, according to the union. The union hopes the plant's No. 1 blast furnace will be brought back on line in September.
Zinc maker refinances debt
Horsehead Corp., a Monaca, Beaver County-based company that dubs itself the largest producer of zinc products in the U.S., said Thursday it has completed a $72 million debt refinancing that will allow it to make working capital and equipment investments. Horsehead is an affiliate of leveraged buyout firm Sun Capital Partners Inc. and operates six facilities nationwide, employing 900.
Mortgage rates edge up
Mortgage rates climbed this week but are still at levels that will keep the housing market hardy, analysts say. In its weekly survey, mortgage giant Freddie Mac reported Thursday that rates on 30-year, fixed-rate mortgages rose to 5.73 percent for the week ending July 21. That was up from the 5.66 percent rate registered last week. Except for two weeks in late March, 30-year mortgages rate have been below 6 percent all year. Low rates have stoked home sales.
Earnings
Wesco International Inc., a Pittsburgh-based electrical products supplier, said it had second quarter net income of $27.4 million, or 56 cents per diluted share, a 27 percent increase over net income of $19.1 million, or 44 cents per share, in the year-ago period. Revenue was $1 billion, compared with $930 million in the year-ago period. The company said it is also in "final negotiations" to acquire Fastec Industrial Corp., a distributor of fasteners, cabinet hardware and locking and latching products. Terms of the deal were not disclosed.
Nova Chemicals Corp. reported a second-quarter loss Thursday as a series of charges and weaker sales knocked the chemicals company into the red. Nova recorded a loss of $25 million, or 29 cents a share, down from a profit of $27 million, or 30 cents a share, a year earlier. The quarter included charges totaling $39 million after taxes, or 47 cents per share, including a mid-April power outage that cost the company $20 million and insurance accruals that cost $15 million. Revenue was $1.33 billion for the quarter, up from $1.24 billion for the same time last year.
Tollgrade Communications Inc. said it had second-quarter net income of $1.2 million, or 9 cents per diluted share, compared with a net loss of $133,000, or a penny per share, in the year-ago period. Revenue was $17.1 million, compared with $15.5 million in the year-ago period. CEO Mark Peterson said the improved performance was a result of the closing of sales that had been delayed until the second quarter. The company forecast third-quarter revenue of between $14 million and $17 million and earnings ranging from a loss of 3 cents a share to an 8 cents per share profit.
ESB Financial Corp., Ellwood City, reported quarterly earnings increased 9.1 percent to $3.2 million, or 24 cents a share. The bank holding company's interest income well exceeded interest expenses. Total assets jumped to $1.8 billion as of June 30 from about $1.4 billion a year ago. ESB has 23 offices in Allegheny, Lawrence, Beaver and Butler counties.
Microsoft Corp. Thursday said fourth-quarter profit rose on strong demand for laptops, personal computers and servers using its software, but the company forecast revenue for the current quarter below Wall Street estimates and shares fell 2 percent. The world's largest software maker said it had a net profit of $3.70 billion, or 34 cents per share, in the fiscal fourth quarter ended June 30, compared with a net profit of $2.69 billion, or 25 cents per share, a year earlier. Revenue rose 8 percent to $10.16 billion from $9.29 billion, its slowest yearly growth ever.
Web search leader Google Inc. Thursday said its profit jumped, fueled by growth in online search advertising. Google posted a second-quarter net profit of $342.8 million, or $1.19 cents a share. The company, which has been publicly held since mid-August, had a net profit of $79.1 million, or 30 cents per share, in the year-earlier period. Other business news
The City of Bridges Cafe restaurant and bar has opened at the landside terminal of the Pittsburgh International Airport. It is the first full-service restaurant also serving beer and wine that airport visitors can access before going through the security checkpoint. This will allow passengers to dine with meeters and greeters, who cannot travel to the terminal side of the airport beyond the checkpoint, where most of the airport's Airmall stores and eateries are located.
After more than a quarter-century as a public company, Toys R Us Inc. is now a privately held corporation. The $6.6 billion acquisition of the nation's second-largest toy seller was completed Thursday by two private equity firms, Kohlberg Kravis Roberts & Co. and Bain Capital Inc., and a real estate developer, Vornado Realty Trust. All have equal stakes.
RedZone Robotics, a Homestead-based company developing robotic systems for examining sewer pipes, will be featured at 9 p.m. Wednesday on the History Channel "Modern Marvels" program, examining the evolution of sewer technology.
Pittsburgh-area stocks fell on Thursday. The Bloomberg Pittsburgh Index of 65 stocks fell 1.70 to 255.78. -- From staff and wire reports
