Energy and Corporate News Roundup

Strategic Insights -

Duke Energy has begun notifying its customers that their electricity rates will increase by about $1.85 for each 1,000 kilowatt-hours of use, effective from July 1 through June 30, 2007. The increase is largely due to a fuel surcharge and deferred income taxes, partially offset by cost savings from the company's merger with Cinergy Corp. Meanwhile, Krispy Kreme Doughnuts Inc. has secured an extension from its lenders to file audited financial statements by October 31, amid ongoing investigations and struggles with sagging sales. La-Z-Boy Inc. has sold its American of Martinsville subsidiary to Hancock Park Associates, a private-equity firm, as part of a strategic shift towards focusing on residential furniture. Lastly, Cingular Wireless will introduce a $5 surcharge for 4.7 million subscribers with older phones, aiming to upgrade them to newer handsets using the globally dominant GSM technology.

Key Takeaways:

  • Duke Energy's rate increase of $1.85 per 1,000 kilowatt-hours of use will be effective from July 1 through June 30, 2007, resulting from a fuel surcharge and deferred income taxes.
  • Krispy Kreme's lenders extended the deadline for filing audited financial statements to October 31, as the company continues to face investigations and struggles with declining sales.
  • La-Z-Boy Inc. sold its American of Martinsville subsidiary to Hancock Park Associates, a private-equity firm, to focus on residential furniture production.
  • Cingular Wireless will introduce a $5 monthly surcharge for 4.7 million subscribers with older phones, urging them to upgrade to newer handsets using GSM technology.
  • Krispy Kreme's financial struggles have led to amended lending agreements, including a July 31 deadline for providing fiscal 2006 financials.
  • La-Z-Boy's integration of American of Martinsville as part of its 1999 acquisition of LADD Furniture was one of the largest deals in the industry's history.

Statistics:

  • $1.85: The rate increase per 1,000 kilowatt-hours of electricity use by Duke Energy customers.
  • 4.7 million: The number of Cingular Wireless subscribers who will be subject to a $5 monthly surcharge for using older phones.
  • 92%: The percentage of Cingular Wireless customers using handsets based on the globally dominant GSM technology.
  • $299 million: The value of La-Z-Boy's 1999 acquisition of LADD Furniture, including the American of Martinsville subsidiary.
  • $8.47: Krispy Kreme's closing stock price, with a 22-cent increase.

Sources:

  • [1] Journal Staff and Wire Report
  • [2] Krispy Kreme Doughnuts Inc. (April 30, 2006)
  • [3] La-Z-Boy Inc. (September 1999)
  • [4] Cingular Wireless (no date provided)