Company News: Utilities, Lululemon, Starbucks, Samsung, Suntechby
Utilities: Countdown to new emissions limits
Pressure is mounting on the U.S. Environmental Protection Agency ahead of an April 13 deadline for the agency to issue the first greenhouse gas limits for power plants. Green groups oppose scaling back or delaying the rule, which spurred a record 2.67 million public comments, most of them supportive. Utilities and coal producers say that if the agency issues a single standard for both gas- and coal-powered plants, when only gas plants could reasonably comply, the rule could be challenged in court. The curbs will apply only to new plants, though coal producers and utilities are bracing for the EPA to target existing facilities next.
Lululemon Athletica: Sheer problems with yoga pants
Retailer Lululemon Athletica recalled a batch of black yoga pants because the fabric was too revealing. It unknowingly sold the defective Luon pants, which retail for $98, for about 10 days before the sheerness issue came up during a weekly call with store managers on March 11. The line makes up about 17 percent of Lululemon’s women’s pants sales in stores. The stock is down more than 16 percent this year, partly on quality-control issues.
Starbucks: A farm of its own
Starbucks bought its first-ever coffee farm to help reach its goal of buying only ethically sourced coffee by 2015. The 593-acre farm in Costa Rica employs about 70 people. Starbucks, which sells fair-trade coffees from countries such as Nicaragua and Cameroon, hopes to develop new blends from the Costa Rica farm. It has spent about $70 million on farmer support programs and loans. McDonald’s announced this month it will invest $6.5 million during the next five years to aid coffee growers in Guatemala.
Samsung: Working on a wristwatch
Samsung Electronics is developing a wristwatch as it races Apple to create wearable devices that perform many of the same functions as smartphones. The first companies to sell devices that multitask could lock customers into their platforms, boosting sales of their phones and tablets. Apple may introduce a watch this year that could let users make calls, check map coordinates, and monitor health-related data, according to a person familiar with its plans. Global wristwatch sales will total more than $60 billion this year.
Suntech Power: Filing for bankruptcy
China’s Suntech Power Holdings, once the world’s largest solar manufacturer, is being pushed into bankruptcy as a global oversupply of solar panels has driven down prices and led to big losses. The company, which defaulted on $541 million of bonds on March 16, isn’t contesting a filing by eight banks to force its largest operating unit into insolvency and restructuring. Backed by government loans, Suntech more than quadrupled its panel-production capacity to 2,400 megawatts a year from 2007 to 2011.