U.S. economy beats estimates at 1.9% Q1 growth
Washington, D.C. — A Friday report by Bloomberg said that the U.S. economy grew at a 1.9% pace in the first quarter, edging estimates of a 1.8% growth pace but marking the start of what policymakers project is a temporary slowdown in growth.
The revised rise in gross domestic product matches the median forecast of economists surveyed by Bloomberg News and follows a 3.1% gain in the prior quarter, according to Friday’s Commerce Department figures.
“We’re going to see improvement in the second half of the year, but I would not expect it to be stellar,” Scott Brown, chief economist at Raymond James & Associates in St. Petersburg, Fla., told Bloomberg in advance of the report. “We still have a bunch of headwinds for growth.”
Finish Line records 20% leap in Q1 profit
Indianapolis — Finish Line reported Thursday that earnings for the quarter ended May 28 rose 20% to $16.4 million, compared with $13.6 million in the year-ago period.
Revenue, despite a 6% rise to $299 million, missed Wall Street expectations of $301.4 million.
Same-store sales increased 6.1% for the quarter.
Sears to spin off 89-store Orchard Supply Hardware chain
Hoffman Estates, Ill. — Sears Holdings Corp. disclosed in a Thursday filing that it plans to spin off its Orchard Supply Hardware Stores Corp. business as a separate, publicly traded company.
In a filing with the Securities and Exchange Commission, Sears said it believes that the 89-store chain will generate more shareholder value on its own. Shares in Orchard Supply Hardware will be distributed equitably among shareholders of Sears Holdings, which owns 80% of Orchard Supply, and Ares Management LLC, which owns the remaining 20%. As a result, ESL Investments, the hedge fund controlled by Edward S. Lampert, which controls roughly 61% of Sears Holdings, will become the new company’s largest owner.
Sears has valued Orchard at $82 million. No target price for the IPO has yet been set and no spin-off date has been announced. Orchard generated a profit of $8.7 million and $661 million in revenue in fiscal 2010, but its revenue has dropped for several consecutive years and its profit picture has been erratic.