Compiled by Julie Leupold
ECONOMIC INDICATORS
Up: Sale of businesses in Orange County last month at 96, up from 80 in January 2009, according to BizBen.com
TOP STORY
The Securities and Exchange Commission dropped its pursuit of a lawsuit against the founders of Broadcom Corp. a week after a federal judge said he had “serious problems” with the litigation. Federal Judge Cormac J. Carney first dismissed the SEC suit as well as criminal charges against Broadcom’s founders and former chief financial officer in December. In late January, he gave an SEC lawyer a week to show why the suit shouldn’t have been dismissed. The SEC’s decision not to refile clears the way for cofounder Henry Samueli to stay in an executive post he resumed at the chipmaker in December.
TECHNOLOGY
In other Broadcom news, the company reported fourth-quarter sales of $1.34 billion that beat Wall Street’s expectations. Exclud-ing charges, the company posted $243 million in profits, up 53% and beating analysts’ expectation of $218 million. The company took a hit to net earnings with a onetime payout of $161 million to settle a class action lawsuit related to improperly backdated stock option grants.
Aliso Viejo-based Quest Software Inc., a maker of business software, reported fourth-quarter results that were down from a year earlier but slightly ahead of Wall Street’s forecast. Quest reported profits, excluding onetime charges of $37 million, down 8% from a year earlier but beating analysts’ expected $35 million in profits. The company posted sales of $195 million, down 4% but surpassing analysts’ expectation of $188 million. Quest’s shares slumped afterward when a Goldman Sachs Group Inc. analyst recommended clients sell the stock.
HEALTHCARE
Irvine’s Allergan Inc. reported a fourth-quarter profit of $239.5 million and sales of $1.22 billion that topped what Wall Street expected. But the drug maker warned of a profit shortfall for the current quarter. Allergan expects a profit of $175 million to $181 million for the first quarter, well below the $168 million analysts had been looking for. Allergan said it forecasts first-quarter product sales of $1.06 billion to $1.1 billion, slightly less than the $1.1 billion analysts had expected.
Irvine drug maker Spectrum Pharmaceu-ticals Inc. is paying $30 million plus future payments to license Belinostat, a drug candidate by TopoTarget AS of Denmark to treat blood and bone cancer. Spectrum gains rights in North America and India with an option for China. The company could pay $320 million and 1 million shares of stock if Belinostat is successful. TopoTarget is set to continue working on the drug with Spectrum funding 70% of development costs.
REAL ESTATE
Standard Pacific Corp. reported a fourth-quarter profit of $82.7 million, the first time the Irvine-based homebuilder has posted a quarterly profit in several years. The slimmed-down company, which has been focusing on generating cash and improving its profit margin in the past year, reported revenue of $339.8 million for the quarter, a 10% decline from a year earlier.
RETAIL
Emeryville-based Peet’s Coffee & Tea Inc., which came up short in a late 2009 bidding war for Irvine-based coffee seller Diedrich Coffee Inc., said early last week its $265 million cash and stock offer still stands and was extended through February in case a $290 million deal with Vermont-based Green Mountain Coffee Roasters Inc. falls through. Last month, regulators asked Green Mountain and Diedrich for more details about their deal.
APPAREL
Foothill Ranch-based clothing retailer Wet Seal Inc. said sales last month fell in line with Wall Street expectations and upped its profit forecast for three months through January. Wet Seal, which runs clothing stores for teen girls and young women, said January same-store sales fell 3.7% from a year earlier. The company upped its forecast to a profit of $7.7 million to $8.64 million. Analysts had been projecting $6.7 million.
FINANCE
New York’s Fitch Ratings Inc. lowered its credit ratings on Newport Beach-based Pacific Life Insurance Co. and its parent company and predicts more investment losses for the life insurer. Pacific Life’s financial strength rating, a benchmark for insurers, was taken from “AA-” to “A+,” still well within what’s considered investment grade.
EDUCATION
Santa Ana-based vocational school operator Corinthian Colleges Inc. topped Wall Street expectations with results for the recently ended quarter and upped its outlook for the current one. For the three months through December, Corinthian reported a profit of $40 million, up 144% from a year earlier and topping the $35 million expected on average by analysts. It reported revenue of $414.3 million, up 30% from a year earlier and topping the $404.5 million expected by analysts. The company forecast a profit of $39.9 million to $41.6 million for the current quarter, which at the high end topped the $39.9 million analysts had been expecting.
