Business news in brief

— QUOTE OF THE DAY “BP made much progress during the full year, yet it is still far from being out of the woods.” Richard Hunter,

head of equities at Hargreaves Lansdown Stockbrokers Article, 1D

Yum still planning China expansion

NEW YORK - KFC parent company Yum Brands expects contention over its chicken suppliers in China to hammer its first-quarter earnings per share by 25 percent but says it plans to forge ahead with its expansion in the country.

The company, which also owns Pizza Hut and Taco Bell, has been reeling from the chicken supplier issue since a December report on Chinese television. The report said suppliers had been ignoring regulations and giving chickens unapproved levels of antibiotics. Yum says a subsequent investigation by Shanghai regulators concluded on Jan. 25, with the company agreeing to adopt stricter oversight of its suppliers.

On Monday, Yum had warned that its earnings per share for 2013 would decline as a result of the issue. That would snap an 11-year streak of profit growth of at least 13 percent.

Yum is the biggest Western fast-food chain in China, with KFC accounting for most of its 5,300 locations in the country. The nation’s economic growth had until now been a boon for the company, while its U.S. business was more inconsistent.

Duke Energy gives up on nuke plant

RALEIGH, N.C. - The largest U.S. electricity company said Tuesday that it will permanently close a Florida nuclear-power plant after botched repairs and use $835 million from an insurance settlement to refund consumers forced to pay for higher-cost replacement power.

Charlotte, N.C.-based Duke Energy said Tuesday that it will close its Crystal River Nuclear Plant north of Tampa, starting a process that may take 60 years before the site is decontaminated and dismantled. The company said it is considering whether to build a new, natural-gas-fueled power plant to replace the power lost by closing the nuclear plant.

The nuclear plant operated by Duke Energy’s subsidiary, Progress Energy Florida, has been shut down since 2009, when its concrete containment building cracked during a maintenance and upgrade project. A 2011 repair attempt resulted in new cracks in other parts of the containment structure. Estimates put repair costs at between $1 billion and $3.4 billion.

Progress Energy Florida provides electricity to more than 1.6 million Florida customers, including the cities of St. Petersburg and Clearwater and the area surrounding Orlando.

  • The Associated PressVirgin Media takeover raised again

LONDON - Virgin Media Inc. has confirmed that it is in talks with Liberty Global Inc. over a possible takeover by the U.S. cable-television giant.

Liberty Global has pay-TV operations around the world and is the largest cable operator in most of its 11 European markets.

Virgin Media, the second-biggest pay TV company in the United Kingdom after British Sky Broadcasting, did not give any details in a brief statement Tuesday, saying only that it would make a further announcement soon.

It is the second time that Liberty Global has looked at buying Virgin Media, in which Virgin boss Richard Branson still holds a minority stake.

Virgin Media was formed through the merger of NTL, Telewest and Virgin Mobile in 2006 and is listed in New York.

  • The Associated PressPledge made to save Indonesia trees

JAKARTA, Indonesia - One of the world’s largest paper companies pledged Tuesday to stop its suppliers from cutting down natural forests in Indonesia, a move it hopes will help preserve the threatened habitats of rare animals such as orangutans and Sumatran tigers while helping to reduce greenhouse gas emissions released from carbonrich peatland.

Asia Pulp & Paper Group worked with environmental groups Greenpeace and the Forest Trust to forge the plan that went into effect Friday. It relies solely on farmed trees grown on plantations and also includes monitoring by outside groups to ensure transparency.

“This is a major commitment and investment from APP Group,” company chairman Teguh Ganda Wijaya said in a statement. “We are doing this for the sustainability of our business and for the benefit of society. We hope our stakeholders will support our new policy, help us along the way and urge other industry players to follow.”

The world’s third-largest paper-producing company had initially expected to implement its plan in 2015. But it had been heavily pressured by environmental groups to change its practices, including cutting down forests to make way for plantations.

More than three-quarters of Indonesia was covered in tropical rain forest a half-century ago, but half of those trees have since disappeared.

  • The Associated Press18 held in $200 million credit fraud

An international crime ring created thousands of fake identities to obtain tens of thousands of credit cards and steal more than $200 million, the Justice Department said Tuesday.

Charges against 18 people were unsealed in federal court in Newark, N.J., where U.S. Attorney Paul Fishman said the scam was “one of the largest credit-card fraud schemes ever uncovered” by the Justice Department.

The conspirators created thousands of false identities and credit profiles, burnished their creditworthiness, and took large loans that were never repaid, according to the FBI arrest complaint. Millions of dollars were wired overseas to Pakistan, India, the United Arab Emirates, China, Romania, Japan and Canada, the FBI claims.

“They used the proceeds of the crime to purchase luxury automobiles, electronics, spa treatments, high-end clothing and millions of dollars in gold,” according to the complaint.

The ring also relied on complicit businesses, such as jewelry stores owned by four defendants, to conduct sham transactions, according to the FBI. The leaders of the ring were Babar Qureshi and Muhammad Shafiq, according to the FBI. No personal information about them was immediately available.

The defendants were scheduled to appear Tuesday in federal court in Newark.

Business, Pages 26 on 02/06/2013

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