Asbury Park Press from Asbury Park, New Jersey • Page 107

Nov. 14, 1984 Asbury Park Press Several retailers post reduced earnings The Associated Press SEVERAL OF the country's major retailers yesterday reported disappointing earnings for the third quarter, when soft sales forced them to mark down merchandise. J.C. Penney Co, the third-largest retailer, posted a 6.6 percent gain in net income for the three-month period ended Oct. 27 over a year earlier.

No. 4 Federated Department Stores Inc. said its profit plummeted 24 percent. Dayton Hudson ranked fifth, suffered a decline, of 3 percent. Allied Stores ranked 12th, saw a drop of 8 percent.

Federated, headquartered in Cincinnati, said its third-quarter net income totaled $42.3 million, or 87 cents a share, vs. $55.4 million, or $1.14 a share, last year. Sales rose 9 percent to $2.3 billion from $2.1 billion. For the year-to-date, Federated's net income fell 19 percent from $139 million, or $2.86 a share, to $113.2 million, or $2.33 a share. Sales rose 10 percent to $6.4 billion from $5.8 billion.

Minneapolis-based Dayton Hudson said its third-quarter net income came to $43.2 million, or 44 cents a share, vs. $44.5 million, or 46 cents a share, a year earlier. Expenses from combining Dayton's and Hudson's in May and Sales jumped 13 percent to $1.13 billion from $1 billion. New York-based Associated Dry Goods said its third-quarter net income totaled $15.9 million, or 80 cents a share, vs. $14.3 million, or 72 cents a share, a year ago.

Sales gained 5 percent to $951 million from $905 million. Allied of New York said its third-quarter net income was $17.6 million, or 84 cents a share, vs. $19.2 million, or 92 cents a share, a year ago. Sales increased 5.5 percent to $932 million from $883 million. For the year-to-date, net income rose 1.5 percent from $48 million, or $2.32 a share, to $49 million, or $2.34 a share.

the sale of two units in September reduced profits by 3 cents per share, it said. Sales for the three-month period climbed 13 percent to $1.9 billion from $1.7 billion. For the year-to-date, Dayton Hudson posted net income of $111 million, or $1.14 a share, compared with $103 million, or $1.07 a share, a year ago. That was an 8 percent gain. Here are details of the other retailers' results: May of St.

Louis said its third-quarter net income came to $39.6 million, or 92 cents a share, vs. $35.4 million, or 82 cents a share, a year ago. Atari chief declares war, cuts prices mm I Ma pm a jssfc I Economic indicators THE STOCK MARKET YESTERDAY'S CLOSE Dow Jones Industrial Average U06.60 off 12.59 I Complete stock listings I begin on page D18 THE DOLLAR YESTERDAY German Mark 2-9685 up from 2.9480 Japanese Yen 241.45 up from 240.93 1 pritish Pound $12625 Off from $1.2670 COLD York Comex $346.10 off $1.50 Krugerrand $364.00 SILVER off $1.25 vlew York Comex $7,625 Off $0.10 mm No. 11 Associated Dry Goods Corp. saw an 1 1 percent jump, but it came mostly from the sale of some stock.

No. 9 May Department Stores Co. enjoyed a 12 percent gain. Penney, based in New York, said its third-quarter net income totaled $101 million, or $1.34 a share, compared with $94 million, or $1.26 a share, a year earlier. Sales rose 10 percent to $3.2 billion from $2.9 billion.

For the first nine months of the year, Penney posted a 5 percent profit increase to $219 million, or $2.92 a share, from $207 million, or $2.78 a share, last year. Jack Tramiel, Atari Corp. chairman, following the announcement of a $60 product line, saying he wanted to pass production cost savings along to consumers. 1 He said there was no plan to phase outthe800XL. In mid-August, about a month after Tramiel took over ailing Atari, the company cut the price of the 800XLfrom $250 to $179.

I i Associated Press responds to questions yesterday, price cut on Atari's home computer. He said Commodore officials could reduce the price of its competing Commodore 64 "if they wanted to." Tramiel also confirmed that Atari would unveil an 8-bit and a 16-bit computer in the first quarter of 1985 and a 32-bit computer in the second quarter. All of the new models would cost under $1,000, according to Copland. Many outraged by "Anybody who sells computers is a competitor," Tramiel said between puffs on a big cigar. But Tramiel emphasized that Atari was not going into the business computer industry.

"We sell products to individuals that's our niche. What they want to do with them is up to them," Tramiel said. In 1983 Atari, which sells only two machines, the 800XL and a $40 video game machine, had a loss of $538.6 million on revenue of $1.12 billion. Tramiel said the company owed $300 million when he took over, and less than $50 million has been collected on the debt so far. But the colorful chairman, who at one point caught himself talking about "Com uh, Atari," and then started laughing, predicted Atari would be showing profits by the end of the year.

Tramiel also said he had invested $30 million in new capital and had guaranteed he would come up with an additional $45 million "if the company needs it." He said at the present the company was "definitely in good financial shape," and that Atari would be raising $150 million over the next 18 months in three installments, "and we hope to go public sometime in '85." Tramiel said the first installment would be a private placement with selected investors in 1985, a public offering later that year and a third issue in 1986. non-bank lobby to keep their new operations, while the smaller banks will push for forced divestiture. Indeed, the chairmen of the Senate and the House Banking committees have already vowed to work hard to close the loophole in the Bank Holding Company Act that allows the quasi-banks to exist. Sen. Jake Gam, R-Utah, and Rep.

Fernand St Germain, have warned that any banking houses setting up non-bank banks after June 30, 1983, may be required to give them up no matter how costly. And the Federal Reserve Board, also unhappy about the trend, is trying to close the loophole. Rebuffed by a federal appeals court in Denver, it plans to carry the case to the Supreme Court. The warning flags, though, seem to have had little effect. "We will watch what Congress does with this issue," said Susan Taha, spokeswoman for Security Pacific National Bank in Los Angeles.

But she added, "we will not hesitate to proceed." Security Pacific, the nation's eighth largest bank-holding company with $40.4 billion in assets, was one of the more than a dozen banking houses recently given tentative approval for quasi-banks. OProblems with credit "experienced by women "It's a back-door deterioration in the banking structure. Banker Charles Doyle 3rd quarter home sales down 2.7 The Associated Press WASHINGTON The National Association of Realtors blamed high interest rates yesterday for a decrease in resales of homes during the third quarter of 1984. Nationwide, resales of single-family homes, apartment condominiums and cooperatives fell 2.7 percent from the same period a year earlier. The figure was a seasonally adjusted annual rate of 2.94 million units.

For New Jersey, sales were 119,200 units, off 1.5 percent. Mortgage interest rates from July to September this year were about one percentage point above the rate for the same period last year. Nevertheless, Alabama, Arizona, Minnesota, Rhode Island and West Virginia recorded increases in home sales of more than. 10 percent. Frank Katusak, vice president of the association's economics and research division, said demand is strong, "but people can't follow their desires because of interest rates." banking "We're aware of the risk of divestiture," said Cynthia Croasdaile, a spokeswoman for Sears, Roebuck which is buying a small Delaware bank to add to its financial services network that already includes a real estate firm, a brokerage house and an insurance company.

But Ms. Croasdaile said consumers have expressed their banking preferences. "They want convenience." Some bankers contend consumers will be hurt by the breakdown in banking barriers. They argue that the bigger institutions will move into smaller areas, buy up neighborhood banks and leave consumers to deal with large, out-of-state concerns. They also say big banks will take community deposits and invest them in money centers around the world.

Federal Reserve Chairman Paul Volcker also has sounded a warning about the issue, even though the central bank has reluctantly given the green light to several bank-holding companies to go ahead with plans. In doing so Volcker sent a letter to Garn and St Germain, expressing concern about the "possibility of a progressive unraveling of the basic tenets of public policy that is, the maintenance of banks as impartial providers of credit and the avoidance of undue risk and conflicts of interest in the banking system." While Conover has become the object of much criticism by opponents of non-bank banks, he says he felt compelled to do something about the stack of 332 non-bank applications piling up in his office. "These banks are clearly legal under existing law," he said. operation, expected before the end of the year. WPPSS, the utilities sponsoring the plants, engineers, lawyers and some large brokerage houses have been named in a series of suits in both federal and state courts.

The suit filed yesterday is the first to name the state. The bondholders seek to recover both principal and interest bringing the total to $7.25 billion. Lawyer Charles Webb III said the state represented to the public that the bonds were a safe investment that met state regulations governing bond sales. "The bondholders weren't buying the risk that the state wasn't going to do its duty," said Webb. Each $5,000 bond was signed by the state auditor and stated the bonds had been properly registered and followed state law, Webb said.

The bondholders' committee was formed under the auspices of Chemical Bank of New York, trustee for the bonds. The bank is paying for the committee's suit The Associated Press SUNNYVALE, Calif. Declaring that "business is the chairman of Atari Corp. said yesterday his company is reducing prices on Atari's 800XL home computer by $60 because competitors have become "greedy." "I came back in business in May because I felt that this business was becoming very dull," said Jack Tra-miel, who resigned as chairman of Commodore International Ltd. in January.

"Everybody was sitting and trying to get as much money as they could. There was no reduction in prices and no improvements in technology." Speaking at a news conference Tra-miel, making his first public appearance since he organized a group of investors to buy Atari from Warner Communications promised to bring "new life, new excitement," to the computer industry. "I believe by working harder, by being lean and mean, we will do quite well," he said. The current price of the 800XL, $179, will be reduced to "under $120," said James L. Copland, vice president of marketing.

"This cost reduction will now make the 800XL the least-expensive, full-featured 64K personal computer in America," Copland said. Tramiel denied that the price reduction was an attempt to generate quick money to underwrite a new Your Money's Worth Sylvia porter especially for those women who have never obtained credit on their own. If you fit that description, all you need to do is write the creditor and ask that the account be listed jointly. If you choose to open your own account, perhaps with your husband as co-signer, use it! Just because you qualify for credit doesn't mean you have a credit history. To create that credit record, use credit and pay the debt off on time.

Meanwhile, women just contemplating marriage have a different set of credit issues to resolve. Today many, if not most, women have their own credit cards when they get married, and their husbands have their own credit lines. "Keep credit in your own name," Kaplan urges. "If your husband gets into trouble with credit, it will be reported on both records if it's a joint account Since bad news gets reported just as fast as good news, keep at least one card in your own name," Kaplan says. Be sure to use that card, too, to maintain your personal rating.

Take care to notify creditors immediately of any change in marital status. For instance, if you have a joint account with your husband, and he runs amok in fancy stores after you separate and can't pay his bank card bill, you become liable for the debt If it's a joint account and one of you cancels, you may each have to apply independently for new credit cards. For more detailed information about your credit rights as a woman, request a copy of the Bankcard Holders of America pamphlet "Women's Credit Rights." Send a stamped, self-addressed business-size envelope to: Bankcard Holders of America, 2025 Eye St N.W., Suite 1022, Washington, D.C. 20006. Sylvia Porter's column appears Mondays, Wednesdays and Thursdays.

The Associated Press WASHINGTON If it looks like a bank, acts like a bank and calls itself a bank, it must be a bank, right? Wrong. 1 It may be a non-bank bank. And it may be coming to your neighborhood. I This new type of bank, recently approved by federal bank supervisors, eventually could reshape the banking industry by creating nationwide chains of banks. Small and medium-sized banks are up in arms about the non-bank banks and say consumers should be, too.

They warn that the new wave of acquisitions threatens the soundness of the nation's banking system. "We're endangering the stability of the total structure," asserts Merle Gras-er, chairman of the First National Bank of Venice in Venice, which has assets totaling $210 million. "It's a back-door deterioration in the banking structure," laments Charles Doyle, president of the Gulf National Bank in Texas City, Texas, which has $23.6 million in assets. What is a non-bank bank, also referred to as a consumer bank? The term describes financial institutions that accept demand deposits checking accounts or make, commercial loans but don't perform both functions, as full-service banks do. By not doing both, they get around the definition of a bank set out in federal banking law and skirt provisions barring interstate banking and prohibiting non-banking companies, such as securities firms, from owning banks.

Congress traditionally has fa- I A BUSINESSWOMAN in Washington, D.C., used only her first initial and surname on her credit cards. When her boyfriend and she jplit up, he stole one of her rarely jised cards. Within a month, he had charged almost $11,000 to her account, including a fur coat for his new girlfriend. He succeeded because no one ever asked him for adequate identification. This dramatic story highlights Jtwo obvious instructions you must not disobey: Spell out your first name on all your credit cards whether you are a woman or a man.

If you are a woman, take extra steps to secure your credit rating to make certain you get the credit to which you are entitled. You will encounter subtle problems with credit no matter how much Vou think you're protected. I "Women are much more aware about how credit works than we were even a decade ago," says Maria Kaplan, associate director of Bankcard Holders of America, a non-profit consumer education group. "Every woman should be sure Jo develop her own credit history, whether married or single," she says. As a' wife, you should have Joint accounts with husband instead of keeping all accounts in his name only, even if that has been family practice for years.

"This is one crucial way women can develop their own credit histories," Kaplan says. "And instead of signing her name 'Mrs. John she should Sign her own first name, for instance, 'Louisa May she says. By having a joint account, in the event of divorce or her husband's death, a woman will still have a credit record of her own. Many divorced and widowed who share accounts with husbands that were opened before June 1, 1977, when the Equal Credit Opportunity Act became effec-Jive, have no credit history of their own.

The reason: Most women, even when informed by their creditors Jhat they could have credit information reported in both names, did not ask to have their credit histories reported separately. For joint accounts opened after June 1, 1977, information is reported in both names. vored keeping banking a separate industry. J.C. Penney Co.

Prudential-Bache Securites Merrill Lynch Co. Gulf Western Corp. and Parker Pen Co. all own non-bank banks. In recent weeks, New York banking giants Citicorp and Chase Manhattan Corp.

have received approval from federal regulators to proceed with plans to set up consumer banks in Minnesota, Pennsylvania and Ohio. Other states targeted by big banks are Colorado, Maryland, Hawaii, Vermont, New Hampshire, Florida and Texas. The fresh approvals, by bank regulator C. Todd Conover, are certain to be viewed by Congress as a challenge to its authority to set the tone for any widespread changes in the closely regulated banking industry. "Let Congress settle it, not Todd Conover," said Grascr.

Conover, as federal comptroller of the currency, supervises some 4,700 national banks. Congress, however, failed to pass legislation this fall that would have headed off Conover's actions, even though Conover postponed his controversial action for 18 months to allow Congress to take action. In the new congressional session, banking and business giants are sure to John Cherberg, Senate Majority Leader Ted Bottiger and Speaker of the House Wayne Ellers. The suit alleges the state has a "moral and legal obligation" to pay the bondholders and that state officials failed to adequately monitor the supply system, while at the same time stating that the bonds met all conditions of state law. In addition the suit alleges that the state failed to exercise proper oversight over the supply system, which is a "joint operating agency" created by the state Legislature.

"This issue is not going to go away," said Hoffer. State officials have consistently maintained that the bonds were not an obligation of the state. "The fact that they have filed it (the suit) comes as no surprise," said Ed Mackie, chief deputy attorney general. "They've been talking about it for several months. I can't comment further until Fve seen the pleadings." Tim Kerr, deputy state treasurer for debt management said the suit Utility investors sue Washington state could cause some uncertainty among potential investors in future issues of state bonds.

"However, things may get back to normal in a few months," said Kerr. The supply system sold $2.25 billion worth of bonds in 14 issues between 1977 and 1981 to pay for the two nuclear plants. WPPSS was building the plants for 88 public utilities in the Northwest The plants were terminated in early 1982, after WPPSS was unable to borrow additional funds to continue construction on the projects, and questions were raised about when the plants' power would be needed. In July 1983 the state Supreme Court ruled the utilities lacked authority to sponsor the plants. A month later the supply system defaulted on the bonds.

The supply system was banished from Wall Street as its financial fortunes fell, and it eventually had to indefinitely mothball two other nuclear projects. A fifth supply system plant is undergoing final tests prior to commercial The Associated Press SEATTLE The State of Washington and its top officials were accused of "fraud, negligence and misfeasance" in a $7.25 billion lawsuit filed yesterday by investors, who bought bonds to finance two now-terminated nuclear power plants. The suit was described by the plaintiffs as the largest ever filed against a state or municpality and follows by a more than a year the largest default in municipal bond history by the Washington Public Power Supply System. "Thousands of people have been victimized," said Arthur Hoffer, chairman of the WPPSS National Bondholders Committee, which filed the suit "State officials cannot put their heads in the sand and avoid responsibility for the WPPSS fiasco." Named as defendants in the King County Superior Court suit were the state, Gov. John Spellman, state auditor Robert Graham, both houses of the state Legislature, state Senate President But joint listing is important, -r J..