Roundup: Watson Wyatt, Lockheed, Freddie, Micros
From staff and wire reports
*Financial advisory firm Watson Wyatt Worldwide of Arlington said fourth-quarter profit rose 32 percent, to $41.7 million (95 cents a share) from $31.6 million (71 cents) in the comparable period a year earlier, on an increase in retirement services demand and the need for investment advice. Revenue, which the company collects through consulting fees, rose 17 percent, to $453.8 million from $388.5 million.
*Lockheed Martin says a double-digit jump in the cost of steel and rising oil prices have helped propel the final price tag of its latest warship for the Navy to more than double the initial estimates. Navy officials earlier this month told lawmakers the service's initial estimate of $220 million per ship had ballooned to as much as $550 million, which they blamed on design changes that occurred during construction.
While the cost of the first two Littoral combat ships -- one each being built by Lockheed Martin and General Dynamics -- is not allowed to breach a congressional cost cap of $460 million per vessel, the ceiling does not apply to run-ups in inflation.
"There is pretty sizable inflation in the shipbuilding industry and without that (inflationary) relief it makes it very difficult," said Fred Moosally, president of Lockheed Martin Maritime Systems and Sensors. Moosally called the Navy's initial cost estimate a "bogus number."
While oil has fallen more than $30 per barrel from its July 11 high of $147.27, it has nearly tripled since the Navy awarded a contract to Lockheed Martin in May 2004. Steel prices have also risen 21 percent since the start of the program, Moosally said.
*Freddie Mac on Sept. 1 will stop buying subprime loans issued in New York state as a law takes effect that holds investors accountable for mortgage fraud.
*Micros Systems, a Columbia firm that sells touch-screen registers and other information technology to the hospitality and retail industries, said it has acquired Ann Arbor, Mich.-based Fry, an e-commerce design, development, and services provider. Micros said it agreed to pay $31.3 million and assume about $18.4 million in debt. Fry shareholders are eligible to earn up to an additional $17 million in payments over the next 23 months, based upon the company meeting certain financial targets.
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