Shorts (right)
Flush with cash, Apple declares dividend and buyback
Apple announced Monday that it would at last return some of its cash pile to shareholders in the form of dividends and stock buybacks, at a cost of more than $10 billion a year for the next three years. But it is attracting so much cash — $1 billion a week in the last holiday season alone — that the move will not put a dent in Apple’s coffers.
Apple’s decision to pay the dividend was long awaited, yet it is an extraordinary one for a company that, despite its age, is growing more like a startup.
While paying dividends is often a sign of cash-rich companies that are running out of big growth opportunities to invest in, Apple, founded in 1976, has not yet reached that level of maturity. It continues to pump out huge new technology hits like the iPhone and iPad, and its sales in the recent holiday quarter grew 73 percent from the period in 2010, which itself was 70 percent higher than the holiday 2009 quarter.
Apple’s cash reached nearly $100 billion at the end of last year, a level that seemed increasingly unjustifiable to many investors, who fret about how little interest Apple earns on the money, estimated at less than 1 percent. Apple’s cash figure is almost twice the cash balance of the company with the next biggest hoard, Microsoft.
Shares of Apple rose 2.65 percent, or $15.53, to $601.10 Monday.
—Nick Wingfield, The New York Times
BP settlement leaves some spill victims unhappy
Denise Spivacke Haralson and her husband, Larry, figured that they almost had their money. They had settled Haralson’s claims against BP for the losses he suffered as a construction worker in the economic slump after the 2010 Gulf of Mexico oil spill.
With the settlement papers signed in November, they had been dealing with last bits of paperwork and had been waiting for a $14,600 check.
That is when BP and the core group of plaintiffs in the case announced that they had reached an uncapped settlement that BP estimates at $7.8 billion for individuals and businesses suing the company. The settlement involved shutting down the claims center that BP had set up at the request of the Obama administration. It is being replaced by another center that will be run under the court’s supervision.
No one, the lawyers have emphasized, would have to accept less than the original offer, but that is little satisfaction for Haralson.
“Now they tell us we have to wait again?” she said, fuming. “We feel they’ve broken our contract.”
The proposed settlement between BP and individual and business plaintiffs over the spill has not even been fleshed out yet, but there are already lawyers and clients complaining that they have been inconvenienced or cut out.
—John Schwartz, The New York Times