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Show [J DailysHerald | THURSDAY, MARCH 9, 2006 BUSINESS EDITOR Grace Leong - 344-2910 - gleong@heraldextra.com v Local Industry NEWS & NOTES Technology SCOfirst quarter net losses widen to $4.6M — The SCO Group Inc., a Lindon-based software developer, said its net losses widened to $4.58 million, or 23 cents loss per shareforthe first fiscal quarterthat ended Jan. 31, from netlossesof $2.96 million, or 17 cents loss per shar e a year ago. The company’s first-quarterlossesinclude $401,000 of stock- based’ compensation expenses, whileits first quarter-losses in 2005included $15,000 of stock-based compensation expenses. Revenuefor thefirst quarterof fiscal year 2006 was $7.34 million as compared to $8.87 million a year ago, because of competition in the corporate server market from Microsoft, IBM Corp. and the Linux community “Despite our decrease in revenue andour increase in net loss incurred duringthefirst quarter, the UNIX business continued to generate positive cash flow,” said Darl McBride, president and CEOof SCO. “Webelieve that with the $10 million in gross proceeds raisedin ourprivate placement in November, we can Dow Jones Final 11,005.74 +25.05 Final 2,267.46 0.92 A | Vv tras.” Tuesday Per ounce $542.50 | a ounce $9.777 ree Cra dollar a fel 1.1567 fee 1.1489 | +2.73 -$10.20 | -$0.258 Mexican peso 10.7515 10.7255 | | 783 Curiosity about Qwest’s future rises Sandy Shore THE ASSOCIATEDPRESS optic network andproveit can be successful against competi- tors invadingits turf. and helpfill its fiber-optic net- work, Chief Financial Officer Oren Shaffer told analysts at an pursue ourbusiness operations and see our lawsuit with IBM tions industry. Witha territorystretching across 14 Midwestern and through to its conclusion.” Western states, Qwest has sta- along. The only thing I can say hereis ofall of those strategies PC Laptopshires workers from Totally Awesome — PC Laptops, EXCHANGING THE DOLLAR Yen Final 1,278.61 consolidating telecommunica- In the first quarter. SCO completed muchof the work for the releaseofits EdgeClick digital services last week, and now has ai. is | | DENVER— Sidelined in the merger gamesinceits failed bid for MCIInc., Qwest Communications could end up acquiring assets, being acquired several customers that are actively using thedigital services technology. | | S8P500. Gold or standing alonein the fast- Qwest Communications In- ternational Inc.is continuing to look at possible acquisitions as long as they would make sense investors conference this week. “We'velooked at those all bilized revenue and pared operations in wakeof an accounting scandal that forced it to restate billions of dollars. But analysts Say it now needs to bolster customerson its nationwidefiber- it’s the onethat we've probably been the most spectacularly unsuccessful at,” he said. / “I think we've done what we need to doto create a valuable companyin Qwest,” he said. a partner companyof the nowdefunct Totally Awesome Comput- “If one weretrying to position themselves to make sure they burn, Va.-based MCIInc., some eight months afterit won a werestill in the game, if you very public, nasty ae war tions Inc. bought AT&T Corp. andtook its name. has about $15 billion in debt, will, as the industry’ consolidates, you woulddojust that.” Qwest executives declined additional comment. Curiosity about Qwest's future was raised after AT&T against Denver-based Atthattime, Qwest CEO. Dick Notebaert said the company would takeits time and look for potential acquisitions as long as it fit its strategy. Like most players in the teleInc. announced plans to buy communications field, Qwest BellSouth Corp.in a $67billion faces increasing competition deal to unite AT&T,BellSouth from Internet-based services and Cingular Wireless LLC. andcell phonecot ies as San Antonio-based AT&T was created wlien SBC Communica- it tries to find new revenue.It In January, Verizon Com- munications Inc. completed an $8.5 billion purchase of Ash- shrinking land-line customers andthe lack of a wireless division althoughit resells wireless service from another company. ers, hired 26 workers as partofits expansionplans. PC Laptops, which plans to expandits six existing Utah stores and open a newlocation in Layton,saidit interviewed more than 50 applicants,including computertechnicians,salesstaff, store managers and executives, mostly from Totally Awesome. “We had morethan 35 prospective employees showup at our Sandystore on Friday night right after the initial debriefing by Totally Awesome Computersat the Jordan Commons movie the- aters, and it was absolutelycrazy,” said Dan Young,president and founder of PC Laptops. PC Laptopsalsowill offer warranty support, including free lifetime labor and service support, to those with Totally Awesome Compuiercontracts. Real Estate Centennial Bank to open in Orem — Centennial Bank, which has two branchesin Utah County, is opening a newbranch at 130 W. Center Street in Orem. A groundbreaking ceremonywill be March 10 at 10a.m The Oremoffice, whichis scheduled for completionin fall 2006, will provide consumer and business loans, money management, real estate andinvestmentservices. The loan production office that Centennial has been operating at 4692 N. 300 West in Provo will * close and mergeinto the new Oremoffice. “Ourpresencein Utah County is getting much stronger. Last October we combined forces with Continental Home Mortgageto create a mortgagecenterin Springville,” said Centennial President Clint Williams. Williams started his banking career in Utah County, beginning with Zions Bank in Provo,then with Central Bank and Trust. Williams Later served as CEO of Wasatch Bank beforeit was ac- quired byZions Bank in 1993. Alan Thomson, whoisa senior vice president for Centennial Bank, has worked for the bank since 2003. HENNY RAY ABRAMS/Associated Press Mark Varian,foreground,president of John Gallin & Son Inc., poses withfellow family members, Chris Gallin, Mike Gallin, _ Tom Gallin, and Maggie Gallin, in the family-owned construction business's conference room in New York. NATIONAL BRIEFING Bernanke: Community banks in good health WASHINGTON — The rapid growth in commercial real-estate loans made by community banks bears watching, even as these mostly smaller, local banks remain in good overall financial health, Federal Reserve Chairman Ben Bernanke warned Wednesday. “In mostlocal markets, commercialreal-estate loans haveperformedwell,” Bernankesaid. “Our examinerstell us that lending standards are generally sound”and are not comparableto the lax standards that contributed to the savings’andloan crisis two decadesago,hesaid. “However, morerecently, there have been signs of someeasing of underwriting standards,” Bernankesaid in a speech to the Independent Community Bankers of America meeting in Las Vegas. The growth of commercialreal-estate loans “raises the possibility that risk-managementpractices in community banks may not havekept pace with growingconcentrations and may be due for upgradesin oversight,”he said. A copyof Bernanke's remarks was distributed in Washington. STOCKS0 OF LOCAL INTEREST. Yesterday's performanceof selected publicly traded companies sym COMPANY LAST CHANGE SYM COMPANY LAST CHANGE AA ‘ABS ‘ABX AEP AIG AMD ALCOAING —_ALBERTSONS INC —BARRICK GOLD CP AMERELECTRICPOWCO —AMERINTLGROUPINC —ADVMICRODEVICES 2878 042 2560 +010 2647-053 35.91 +006 6696 +047 «3709-118 MSFT MU MYGN NATRE NETM. NOVL MicosohtCoporatin MICRONTECHNOLOGY Myriad Genetics, Inc Nature's Sunshine NetManage, nc Novelnc «2725 +019 1487-011, 26.06 40.10 1663 +013, 556-008 740-002 AMGN Amgen inc. NUS —-NUSKIN ENT INC 1761 BAC Bu Bis BK OF AMERICA CP ALCP BELLSOUTH CP BN BANTA CORP Cc CITIGROUPINC CBAG CRESTED CORP CMCSK Comcast Corporation 420 +041 4571 +009 4315 +014 3415 +038 4831 +012 46,68 +028 2.66 "0.08 2671 004 CVX DIS DNEX ERICY EIR FC GOW GE CHEVRON CORP WALTDISNEY-DISNEYC Dionex Corporation \MEncsson Telephone ENTERGYCP FRANKUNCOVEYCO GOLDENWESTFINCP GENELECTRICCO HA TARE SHSIC HCA INC HRBLOCKINC Henry chen, nc 4187 +072 “IBM INTLBUSINESSMACH’ 81.14 +085 INTC BLU XP AWN KRON LEE UB LEE ENTERPRISES. LONGVIEW FIBRE CO 3449 0.07 WANS +118 LUV SOUTHWESTAIRLINES MCKESSON CORP 5377 +023 MER MITY MLCOCMNSTK MITY Enterprises inc. 714 007 18:80 +024 LUCENTTECHINC Q QWEST COMM INTLINC ROYALDUTCHPETSWIS 65.745 0.00 SCOGroup, inc. (The) 4.20 +0.04 Sears ‘Corporation 11850 -0.67 | | | | | | | SMITHINTLING | 3620 SkyWestinc. 2761 Sento Corporation 820 SCOTTISH PWRADS 3963 TheSt PaulTravelersColnc 4254 QUESTARCP 6945. Shalt Transportaton Co, Inc. 2358. sraasEiNc 2144 | T ATATING. UNH UNITEDHEALTHGROUP WEN WFC WENDYSINTLINC WELLSFARGO&CONEW WNI SCHIFF NUTRIT INTL UNITEQSTATESSTEEL 55.60 +050 EL ZION XCEL ENERGY INC Zions Bancorporation 1820 +015 “8322 +092 TARGETCP UNITEDDOMINRLTYTR 005 | USB USBANCORP * 027 USEG US Energy Cop. +061 USNA USANAHealth Sciences inc 41.10 | UTMD Utah Medical Products In. 090 | V2 VERZONCOMMUN | 0.00 MMSI Ment Medical Systems inc. 1399. +008 | | X Joyce M. Rosenberg THE ASSOCIATED PRESS 064 +019 +008 021 +0.14 +035 +0.01 +004 26.79 +026 5337 +051 27.02. +015 57.20 +078 3056 +007 557-008 42.36 019 33:00 +015 33.44 007 028 +037 6441 0.08 4527 000 520 005 members. CEO MarkVarian,a greatgrandsonof the founder,attributes the NEW YORK — It has been the dream of entrepreneurs throughoutthe ages: Start a company,build it up, and someday,pass it on to your children, grandchildren, even great-grandchildren. The odds areit won't happen: Many,if not most, family businesses don't survive the passage from one generation to another — personal issues, children who don't wantto workin the firm andfights over money areoften fatal blows. Yet many do makeit into the second andthird generations and beyond,often because fi membersare committed to continuing the legacy of company founders. John Gallin & Son Inc., a New Yorkbased contractor,is now run by the fourth generation of Gallin family company’s longevity in part toits shareholders agreement andthe fact there are no passive investors — all the owners must workfor the company. AlexDominguez THE ASSOCIATED PRESS BALTIMORE— Electric rates will surge for many Marylandresidents this sum- coming into the firm in the 1970s, and there arecurrently five descendants of the founderin the business. Somefamily companies fail in the secondorthird generationbecause the children or grandchildren just aren't as a safety net for a family firm. Such agreementscan, for example, prevent family membersfrom selling stock to outsiders, thereby preserving the fami- interested in owning and operating the business.In someofthe worst scenarios, a relative of the ownerfeels obligated to take over the company, but ends up runningit into the ground because he or she doesn't havethe heart ortalentto do it. In suchcases,it might be better off for everyone's sakeif the companyis sold ly’s controlof the business. and the family moves on. Shareholder agreements, which among other things can dictate how stock in a companycan be sold or otherwise transferred, are widely advocated John Gallin founded the company in 1886, andit was taken overbyhis son, William,in 1912. William’s two sons cameinto the business in the1940s, and they tookit over after their father’s death. The fourth generation started Deregulation blamed by someforhigh electric bills 6.44 +006 si SKYW SNTO SPI STA STR SWET SY 288 +002 | WMT. WALMARTSTORES 1701 3358 +021 3873 +057 2617 002 ROPRF SCOX SHLD 215 029 | ToT 4658 +061 UDR 2001 11.81 60.28 4046 4041 MCK | | | 35.12 020 28,05. +0.04 5365 060 «3447 +009 7025 +035 735.4012 70.05 +064 BO 07 intel Corporation etBlve Arways Coporation PENNEYJCCOHOLDIN NOROSTROM INC Kronos incorporated WW NWN NORTHWESTNATGAS PCG PGRECP PFE PFIZERINC +011 Family businessescan thrive with care owned its own powerplants and transmissionlines. In deregulated states, power providers purchase the electricity they deliver at market rates as opposed to prices established by utilitycommisElectric rates arerising nasions.In theory, this would retionwide and manyare blam.ward the most efficient power ing deregulation plans origiproducersand thereby reduce * nally designed to spur cheap prices for consumers. energy production as much as But as electric deregulation highes fuelprices. went intoeffect in the late In Maryland,state regula1990s, there was a surgein the tors say Baltimore Gas & Elec- \ construction of powerplants tric Co. residential customets that run on natural gas, in will see their rates increase 72 large part because of its repupercent, althougha plan imtation as an inexpensivefuel. posed this week will deferall To make matters worse, the but 21 percentofthe increase. increase in natural gas Sean In Montana, higher rates have coincided witha per led to a moveto scrap that which companies that Grill for state’s deregulation the fuel struggled to keep up ition plans were with the new demand. promoted as a wayto introduce Electric rates didn’t change competition into the electricity for many customers at first marketplace and move from the because rates were capped traditional regulated utility that for a numberof years to al- ‘ Varian said another reason his companyis still alive and well is becauseit never was passed on to family members who weren't suited to the business. “One. of the benefits of a large family is those people get weeded out,” he said. Shining a light on the costof electricity Thenational averageretailprice ofelectricity has been on the rise in recent years. Theinflation-adjusted price is still lower thanit was decades ago. © $52 - $60 Average monthly spending a $61-$70 onresidentialelectricity bill S| ws 2 Ehesif mer. And they are not alone, S|CALLS7S:S103TOSUBSEHTBE) Bp & SOURCE: Departmentof Energy AP low companies to recoupsocalled ‘stranded costs’ forthe which buy power, charge for the transmission and billthe construction of power plants. customer. Power plants, meanwhile, were sold off as manyutilities split te generating companies and transmission companies, Customers are now finding that as the caps end, their electric rates are rising instead of falling. sm |