======================== THE MOTLEY FOOL ========================
                    B R E A K F A S T   N E W S
                    Wednesday, October 3, 2001
benjamin.rogers@enron.com
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IN THIS ISSUE
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- TOP STORY: Nortel Drops Estimates, Ups Layoffs
  http://www.fool.com/m.asp?i=508935

- NEWS TO GO: GlaxoSmithKline, Eli Lilly, and Flextronics
  http://www.fool.com/m.asp?i=508936

- POST OF THE DAY: Berkshire Hathaway's Float
  http://www.fool.com/m.asp?i=508937

=================================================================

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"Visibility remains poor but we are seeing some clarity
develop." -- Outgoing Nortel CEO John Roth

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TOP STORY
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NORTEL DROPS ESTIMATES, UPS LAYOFFS
Beleaguered telecom supplier Nortel Networks (NYSE: NT)
announced more pain after market close yesterday. The company
will cut another 20,000 jobs and expects a lowered $3.5 billion
in Q3 revenue to produce a $3.6 billion -- or $1.13 a share --
loss.

>>FULL STORY:
http://www.fool.com/m.asp?i=508939

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NEWS TO GO
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Private Rx help. Drug behemoth GlaxoSmithKline (NYSE: GSK) will
reportedly announce today a national discount program for
low-income elderly individuals without prescription drug
coverage. An orange card would entitle holders to receive
discounts of 25% and higher for the drugs outside of hospitals
at most pharmacies. The company's move could be an effort to
head off government prescription coverage for the elderly, while
the price cuts could help the company's drugs better compete.
GlaxoSmithKline makes such well-known products as asthma
treatment Flovent, anti-depressant Paxil, and diabetes drug
Avandia.

Revenue depressant. Big drug maker Eli Lilly (NYSE: LLY) warned
this morning that while its Q3 EPS remain on track at $0.66, Q4
EPS are likely to fall to between $0.59 and $0.61. The Street
had expected Q4 numbers of $0.65. The change is due to the
decline in revenues for Lilly's blockbuster antidepressant
Prozac, which lost patent protection in August. To bolster its
drug pipeline, Lilly recently made a strategic investment in
Isis Pharmaceuticals (Nasdaq: ISIP)
( profiled in a recent issue of The Motley Fool Select). Lilly
shares closed yesterday at $82.87, with a 52-week range of
$70.01-$97.13.
http://www.fool.com/m.asp?i=508940
http://www.lnksrv.com/m.asp?i=508941

Flexing muscles despite smaller diet. Contract manufacturer
Flextronics (Nasdaq: FLEX) continues its expansion with the
purchase of half of Xerox's manufacturing operations for $220
million. President Michael Marks reportedly told investors at a
conference on Sept. 10 that the company's new deals would lead
to a 40% revenue increase this fiscal year -- despite such
roadblocks as a slowdown in its deal with Motorola (NYSE: MOT).
Earlier this year, Sweden's Ericsson (Nasdaq: ERICY) chose
Singapore-based Flextronics as its manufacturer, and Microsoft
(Nasdaq: MSFT) also signed up with the company for the upcoming
X-Box game console.
http://www.fool.com/m.asp?i=508942

Caught in the Crossairs? U.S. airlines aren't alone in their
suffering. Switzerland's pride and joy Swissair filed for
protection from creditors and grounded its planes after a
bank-led bailout failed to solve its financial woes. Some
reports lay the blame at the feet of the country's number one
bank UBS (NYSE: UBS), which joined Credit Suisse with a $168
million cash infusion Tuesday, but apparently too late to please
Swissair's suppliers. That deal also plans to turn Swissair's
70%-owned Crossair regional unit into a smaller national
airline. Belgium's Sabena, 49.5% owned by Swissair, has filed
for bankruptcy after Swissair failed to come through with new
cash.
http://www.fool.com/m.asp?i=508943

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POST OF THE DAY
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BERKSHIRE HATHAWAY'S FLOAT
"In short, float is cheap capital. That is, it's the ability to
use money at a cost less than you'd normally have to pay (e.g.
interest on a loan), and less than the return you can earn on
that money. Of course, it's possible to generate "float" that
actually costs you more than other sources of capital, but a
better description of that circumstance would be "high interest
loan," since the word float really connotes some benefit to the
recipient."

>>FULL POST:
http://www.fool.com/m.asp?i=508944

=================================================================

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