- The Washington Times - Friday, February 21, 2003

Here is a look at Friday's top business stories:

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Report: GE to change way it determines senior executive pay

NEW YORK, Feb. 21 (UPI) — The Wall Street Journal reports that General Electric Co. has agreed to change the way it determines senior executive pay to exclude the effect of any income generated by the company pension plan.

The Journal said GE currently calculates top executives' pay based on factors including earnings per share, which allows companies to count as income the amount by which the estimated return on pension assets exceeds a pension plan's current costs.

In 2002, a company spokesman told the newspaper, the pension plan contributed $1 billion income after tax.

GE has adopted the measure in response to a shareholder proposal by the Communications Workers of America, CWA, which includes thousands of the company's workers and retirees, the paper said.

Ed Fire, president of IUE-CWA, told the Journal that the GE move was "a step in the right direction".

GE's presiding director and head of its compensation committee, Andrew Sigler, is scheduled to meet with several large shareholders next month to discuss executive compensation, a GE spokesman told the paper.

GE plans to explain the new compensation system next month, according to the Journal.

The change will have an impact on the long-term incentive compensation program for the three-year period starting this year. The management-compensation committee will also be provided with net income figures minus the pension income when considering executive bonuses, the GE spokesman told the Journal.

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LoJack posts profit

WESTWOOD, Mass., Feb. 21 (UPI) — LoJack Corp., a provider of technology used to recover stolen vehicles, said it posted a fourth-quarter profit of $904,000, or 6 cents a diluted share, compared with a net loss of $570,000, or 4 cents a diluted share during the same period a year earlier.

Revenue was little changed at $27.52 million compared with $27.57 million a year ago.

Domestic revenues declined 5 percent reflecting the current economic climate. International revenues jumped 24 percent, primarily attributable to strong product sales to the company's South African and South American licensees.

Ronald J. Rossi, chairman, said, "For the year of 2002, we are pleased with our domestic and international performance, and that we returned to profitability in the third quarter and maintained this level of profitability in the fourth quarter despite the difficult global economic climate.

"The improvement in market penetration and in profitability reflects our investments in sales, marketing and product development, which have been funded using cash generated from operations, consistent with our strategic business plan," he said.

Looking ahead, Rossi said, "As we enter 2003, we now have strong marketing and engineering organizations in place. In light of the potential continuation of a difficult global economic climate, we are continuing to focus on improving productivity and achieving greater operating efficiencies, with the objective of continuing to increase our profitability in the face of a potential slowing of sales growth. The areas of focus include sales and distribution as well as overall installed cost of our product.

"We expect to deliver continued revenue growth in 2003. Due to the uncertain economy and geopolitical situation we expect to grow at a more modest rate of 12 percent to 14 percent, rather than the aggressive 17 percent rate we achieved in 2002," he said.

"Although we face a very uncertain geopolitical and economic environment, we believe earnings in excess of 50 cents per share are attainable in 2003," Rossi added.

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H.B. Fuller hikes prices

ST. PAUL, Minn., Feb. 21 (UPI) — H.B. Fuller Co. said its adhesives business segment will hike prices by 6.5 percent for water based adhesives, 4.5 percent for hot melt adhesives and specific individual increases for various other products, effective March 15 or as contracts allow, for their North American customers.

The compnay said the price hikes in a wide variety of key raw materials as well as increased transportation costs, were caused largely by the uncertainty surrounding the political situation in the Middle East.

"In this period of instability the company continues to work with its raw material suppliers to safeguard uninterrupted supply of products for their customers in case of a military conflict," H.B. Fuller said.



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