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Business Briefs

Reported by Star-Bulletin staff & wire

Monday, December 4, 2000

Northwest to expand Twin Cities service

Northwest Airlines said today it will shift to year-round service on its daily nonstop service to Honolulu from Minneapolis-St. Paul.

The service had been winter-only, aimed at residents fleeing the Twin Cities cold, but the airline said Hawaii now is clearly a year-round destination so it will also fly the route in the summer. For the peak season, mid-December through April, Northwest will use a 370-seat Boeing 747 on the route. In the summer, starting May 1, it will use a 281-seat McDonnell-Douglas DC-10.

Building contracts fall 6% in isles

The value of contracts signed last month for future construction in Hawaii was $124.3 million, down 6 percent from $131.8 million in November 1999, according to the F.W. Dodge unit of the McGraw-Hill Companies.

The unit, which monitors U.S. construction activity, said residential building contracts grew 89 percent to $85.3 million last month from $45.1 million in November 1999.

But contracts for nonbuilding work, such as streets and bridges, were down 27 percent last month at $34.6 million from $47.6 million a year earlier. Orders for nonresidential work, such as office buildings, were down 89 percent at $4.4 million last month from $39 million.

State's fact book available online

The State of Hawaii Data Book 1999 -- with an abundance of details on Hawaii's population, work force, tourism industry, consumer trends and hundreds of other aspects of island life -- is now available online at http://www.hawaii.gov/dbedt/db99/index.html.

The fact-filled document shows a population of 1.19 million as of mid-1999, including more than 223,000 classified as "Hawaiian or part-Hawaiian." Other interesting items include statistics that show there were 21,000 marriages in Hawaii in 1998, the latest year for which data are available, and that Hawaii consumed over 28 million gallons of beer in 1999, or about one 12-ounce can per adult resident per day.

The most popular names in Hawaii for newborns in both 1997 and 1998 were Joshua for boys and Taylor for girls, the book says.

Of Mutual Concern

News for mutual fund investors

Janus Capital losses top $1 billion a day

KANSAS CITY, Mo. -- Janus Capital Corp., which rode bets on fast-growing technology companies to become the top-selling U.S. mutual fund group, shed more than $1 billion a day in assets over the past two months as sliding stock markets sliced the value of its holdings.

Janus' parent, Stilwell Financial Inc., said assets totaled about $262 billion as of Nov. 30. That's down from about $315.5 billion at the beginning of the quarter and $300 billion at the beginning of the month -- an average loss of about $1.27 billion for every day U.S. markets were open since Sept. 30.

The decline underscores how much Janus -- which accounts for 97 percent of Stilwell assets -- has been hurt by the 46 percent plunge in the Nasdaq composite index from its March 10 record. While bets on computer- and telecommunications-related companies fueled its growth, they are now stoking declines. Because fund companies earn revenue based on a percentage of assets managed, the decline will erode earnings, which more than doubled in the three months ended Sept. 30. Stilwell's shares fell 28 percent the past three months, more than double the Standard & Poor's 500's 12.5 percent drop.

Study: Fees get lower as funds get bigger

NEW YORK -- Management fees, the price mutual fund investors pay to foot the bill for a fund's portfolio manager and analysts, decline as the fund gets bigger, a new study shows.

The study by fund-tracking firm Lipper Inc., which examined fee schedules for 5,800 funds, also found that the majority of newer and smaller stock funds have flat-rate fee schedules.

But a large fund does not cost that much more to run than a small one. So advisers begin to pass on additional savings to investors as the fund hits certain higher asset levels, known as breakpoints.

Management fees are usually charged as a percentage of assets and the median fees drop steadily through asset classes before reaching a low of 0.36 percent of net assets for portfolios larger than $10 billion. The study found that nearly nine out of 10 stock funds with $10 billion or more in assets have established breakpoints to lower the management fees. But flat-rate fee structures are predominant in portfolios with less than $500 million in assets in all but two asset classes, the study found.

T. Rowe Price hires fixed-income director

BALTIMORE -- T. Rowe Price International hired Ian Kelson as director of international fixed income, a new position, to oversee its $1 billion in international bonds. Kelson left a year ago as fixed income chief of Morgan Grenfell/Deutsche Asset Management, where he oversaw $50 billion worldwide. He said at the time he was leaving money management and could not be reached for comment today. Based in London, he's charged with expanding bond investments for T. Rowe's institutional and retail clients, the firm said in a statement.

T. Rowe Price International is a unit of T. Rowe Price Associates, which oversees $179 billion, $39 billion of that in fixed income.