UPDATE 1-Universal Corp. Issues Weaker First Quarter Outlook

Source from:  NEW YORK, Aug 2 (Reuters) 08/04/2005

Leaf tobacco producer Universal Corp. (UVV.N: Quote, Profile, Research) said on Tuesday that it does not expect earnings for the first quarter to compare favorably to those of the prior year, due to a drop in blended strips processed in Italy, a large, poor quality flue-cured crop in Brazil and other factors. Universal said several issues could affect future quarters. Among those, the company cited the combination of the poor crop in Brazil and a stronger local currency, which has created difficult market conditions. It also said depressed economic conditions in Europe may impact its lumber and building products segment. Universal said it plans to cut corporate overhead by $9 million as it grapples with the costs of compliance with the Sarbanes-Oxley Act, higher interest costs and a high corporate tax rate. Universal also said it would work on strengthening its balance sheet. Shares of Richmond, Virginia-based Universal fell 8 cents to $45.93 in afternoon trading on the New York Stock Exchange. The company plans to announce first quarter results after the market close on Aug. 8. Enditem