Boeing third quarter profit beats expectations; defense strong

CHICAGO, Wed Oct 24, 2012 – Boeing Co. posted stronger-than-expected results for the third quarter on Wednesday and raised its forecast for the full year, as its defense business improved and commercial aircraft deliveries surged.

The company said it earned $1.0 billion, or $1.35 a share, compared with $1.1 billion, $1.46 a share, a year ago. Revenue rose to $20.0 billion from $17.7 billion.

Analysts surveyed by Thomson Reuters I/B/E/S had expected Boeing to post earnings per share of $1.13 for the quarter that ended Sept. 30.

“They were obviously strong in defense, which is certainly good to see,” said Ken Herbert, an analyst at Imperial Capital LLC.

Defense revenue fell 4 percent $7.8 billion, compared with a year ago, but margins widened to 10.5 percent from 10 percent.

Those shifts reflected contraction of defense spending – a growing trend as the United States and Europe cut budgets – but also showed Boeing’s ability to be “very aggressive” in cutting costs, Herbert said. “They’re ahead of the curve compared with their peers.”

Johnson & Johnson third quarter profit beats view as drug sales rebound

NEW BRUNSWICK, N.J., Tue Oct 16, 2012 – Johnson & Johnson reported better-than-expected quarterly results on Tuesday, as pharmaceutical sales rebounded with the help of newer products, including treatments for prostate cancer and hepatitis C.

The company earned $3.0 billion, or $1.05 per share, in the third quarter, compared with $3.2 billion, or $1.15 per share, in the year-earlier period.

Excluding special items, the diversified healthcare company earned $1.25 per share. Analysts, on average, expected $1.21 per share, according to Thomson Reuters I/B/E/S.

Revenue rose 6.5 percent to $17.1 billion, topping Wall Street expectations of $16.97 billion. Sales would have risen 10.8 percent if not for the stronger dollar, which hurts the value of revenues in overseas markets.

J&J slightly raised its full-year profit forecast to between $5.05 and $5.10 per share from $5.00 to $5.07 per share.

Company shares rose 1.1 percent to $69.40 in premarket trading.

Gannett’s third-quarter revenue tops view, profit rises

McLEAN, Va., Mon Oct 15, 2012 – Gannett Co. Inc. reported better-than-expected revenue and higher profit on strong television advertising from the Summer Olympics and the U.S. presidential election and online subscription revenue from its newspapers.

The owner of newspapers and television stations said on Monday that third-quarter revenue rose 3.4 percent to $1.31 billion. Analysts expected revenue of $1.29 billion, according to Thomson Reuters I/B/E/S.

Net income increased to $133.1 million, or 56 cents per share, from $99.8 million, or 41 cents per share, in the same quarter last year. Analysts expected earnings per share of 53 cents.

Still, investors sent shares down 3.6 percent to $17.25 in early trading on Monday despite the positive numbers.

Evercore analyst Doug Arthur thinks investors were looking for a bigger upside. “The stock has done awfully well,” he said about the 26 percent run-up over the past three months.

A record for third-quarter revenues at its broadcasting division and a moderating decline at its U.S. newspapers suggested the momentum will continue into the fourth quarter, said Benchmark Co analyst Edward Atorino.

“Political (advertising) is going off the chart, and newspapers are on track, which is encouraging,” he said.

Gannett, the largest U.S. newspaper chain with 82 properties including USA Today, implemented a plan unveiled earlier this year to reduce its dependence on advertising at its newspapers and to capitalize on broadcast TV.

As a result of a digital pay model rolled out to 71 markets, circulation revenue rose 10 percent at its U.S. newspapers.

Even the pace of advertising declines has begun to slow. Advertising revenue at its publishing division fell 6.6 percent, compared with an 8 percent decline in the second quarter.

Gannett also owns a group of newspapers in Great Britain.

Retail sales point to stronger third-quarter consumer spending

WASHINGTON, Mon Oct 15, 2012 – U.S. retail sales rose in September as Americans bought more cars and gasoline, while a gauge of consumer spending pointed to stronger-than-expected economic growth in the third quarter.

Retail sales increased 1.1 percent, the Commerce Department said on Monday, beating expectations after an upwardly revised 1.2 percent rise in August.

Retail sales outside of autos, gasoline and building materials – a barometer of consumer spending known as core retail sales – rose 0.9 percent last month.

That was well above the 0.3 percent gain expected by analysts in a Reuters poll, and suggests consumers did more to drive economic growth in the July-September period than economists had expected.

Consumer spending drives about two-thirds of the U.S. economy.

Sluggish demand and a punishing drought restricted the economy to a 1.3 percent annual growth pace in the April-June period. Before the retail sales report was released, economists were expecting growth to accelerate to a 1.6 percent pace in the third quarter, according to a Reuters poll.

The details of the report showed broad strength across retailers, with sales of motor vehicles and parts up 1.3 percent. Receipts at gasoline stations rose 2.5 percent, reflecting an increase in prices paid at the pump.

Other categories were also strong, with sales at electronics retailers up 4.5 percent, while sales at food and beverage stores rose 1.2 percent.

Fed names banks that tapped discount window in Q3 2010

WASHINGTON, Fri Sep 28, 2012 – The Federal Reserve on Friday named the banks that borrowed at its discount window during the third quarter of 2010, but the period showed very low levels of activity and none of the biggest Wall Street firms had turned to the facility for help.

Some of the decline in discount window borrowing may have reflected banks steering clear because they knew their actions would be disclosed, albeit with a two-year lag, once the Dodd-Frank financial reform law was passed.

However, Fed officials said it was impossible to know how much this may have been a factor in driving down discount window business, as opposed to what extent the lower level of borrowing just a reflection of market conditions at the time.

The data showed that Gorham Savings Bank of Gorham, Maine, and Commerce Bank of Kansas City, Mo., took the largest discount window primary credit loans. Gorham’s largest loan was $70 million during the period and Commerce’s was $60 million.

The data covers a wide range of Fed activities, including discount window borrowing and foreign exchange transactions, from July 22, 2010, which was the day after the passage of Dodd-Frank, until Sept. 30, 2010.

The discount window is a Fed lending facility that banks can access in times of stress and became essential to maintain functioning markets during the 2008 financial crisis.

The Fed document release was the first mandated by the 2010 Dodd-Frank financial reforms, but it also followed previous discount window disclosures forced on it by U.S. courts after several media organizations fought a stiff legal battle.

Intel cuts outlook on weak PC demand; shares slump

SAN FRANCISCO, Fri Sep 7, 2012 – Intel Corp. cut its third-quarter revenue estimate more than expected on Friday due to a decline in demand for its chips as customers reduce inventories and businesses buy fewer personal computers.

Intel also said it was scaling back capital spending as a result of the business slowdown. Intel’s stock fell 3.6 percent, and shares of ASML and other companies that make chip-manufacturing equipment also lost ground.

A revision of Intel targets had been anticipated by some analysts after PC makers Hewlett Packard and Dell Inc. warned of slow demand last month, a development that has been compounded by a shaky global economy and consumers shifting toward tablets and smartphones.

But the 8 percent reduction in the top chipmaker’s revenue outlook was much more severe than expected. Intel also withdrew its full-year forecast.

The scaled-back outlook comes just days ahead of a major event where Intel will tout a new generation of processors that consume less power, central to its strategy of reinvigorating a stagnant PC industry.

Bernstein analyst Stacy Rasgon said the size of the Intel cut was surprising and was a worrying new sign that the company is seeing weakness in PC sales to businesses and governments, known as enterprise sales.

“They also have weakness in enterprise PCs in emerging markets. In the last six to eight quarters, consumers have been weak but the enterprise was strong. Now the enterprise is weak,” Rasgon said.

Retail sales in July point to rebound in consumer spending

WASHINGTON, Tue Aug 14, 2012– Retail sales rose in July for the first time in four months as demand rose broadly for everything from cars to electronics, a sign that consumers could drive faster economic growth in the third quarter.

Retail sales rose 0.8 percent last month, the Commerce Department said on Tuesday.

It was the biggest gain since February and well above analysts’ expectations. Economists polled by Reuters had expected retail sales to rise 0.3 percent.

The report bolsters the view that the slowdown in economic growth during the second quarter will prove temporary.

It also offers some relief for President Barack Obama, whose November re-election bid has been imperiled by a weak jobs market. Republican challenger Mitt Romney is focusing his campaign on the weak economy that has plagued Obama’s presidency.

The report could also splash a bit of water on hopes the Federal Reserve could soon launch another bond-buying program to help the economy.

Job creation in the United States slowed dramatically in the second quarter as consumer spending cooled and economic growth slowed. Job creation accelerated in July although the unemployment rate still rose to 8.3 percent.

Pointing to a strong increase in consumer spending during July, the so-called core measure of retail sales – which excludes autos, gasoline and building materials – rose 0.9 percent. That was the biggest gain since January.

Macy’s posts higher third-quarter net, raises full-year outlook

NEW YORK ― Macy’s Inc. reported a higher third-quarter profit, helped by sales gains on its website and at its upscale Bloomingdale’s chain, and the retailer raised its profit forecast for the fiscal year.

Macy’s raised its profit per share forecast for the current year 10 cents to a range of $2.70 to $2.75, and expects $1.52 to $1.57 of that to come in the holiday quarter.

Macy’s, which also owns the upscale Bloomingdale’s chain, reported net income of $139 million, or 32 cents a share, for the quarter that ended Oct. 29, compared with $10 million, or 2 cents a share, a year earlier.

The department store operator reaffirmed its sales forecast and still expects same-store sales, or sales at stores open at least a year, to rise between 4 percent and 4.5 percent in the current holiday season quarter.

Goldman Sachs posts deeper-than-expected third quarter loss

NEW YORK ― Goldman Sachs Group Inc. posted a wider-than-expected loss of $428 million for the third quarter, only its second quarterly loss as a public company, hurt by sharp declines in the value of investment securities and customer trading assets.

Chief Executive Lloyd Blankfein cited difficult market conditions and a lack of confidence among investors and corporate clients for the poor results.

“Our results were significantly impacted by the environment and we were disappointed to record a loss in the quarter,” Blankfein said.

Shares of the largest U.S. investment bank by assets were down 2 percent in premarket trading.

Goldman’s loss-driver was its Investing & Lending division, which holds stocks, bonds, loans and private equity assets as long-term investments.

The division reported negative revenue of $2.48 billion as the value of those assets dropped sharply. Goldman’s stock investment in Industrial and Commercial Bank of China Ltd alone generated more than $1 billion of paper losses.

Goldman was also hurt by big declines in bond trading and investment banking revenue.

Its fixed income, currency and commodities client trading business reported $1.73 billion in revenue, a 36 percent decline from a year earlier. Investment banking revenue dropped 33 percent to $781 million.

Citigroup Q3 net rises, boosted by accounting gain; had received two bailouts

CHARLOTTE, N.C. ― Citigroup Inc reported higher third-quarter earnings on Monday as the bank set aside less money to cover bad loans and recorded an accounting gain banks can take in turbulent markets.

Citigroup, the third-largest U.S. bank by assets, reported net income of $3.77 billion, or $1.23 per share, up from $2.17 billion, or 72 cents per share, a year earlier.

The latest results included a pre-tax gain of $1.9 billion, or 39 cents per share, due to the bank’s widening credit spreads during the quarter.

Excluding that gain, Citi earned $2.6 billion, or 84 cents per share.

It was not immediately clear if the results were comparable with analysts’ average earnings forecast of 81 cents per share, according to Thomson Reuters I/B/E/S.

The bank — which received two U.S. government bailouts at the height of the financial crisis — is seeing its problem loan portfolio shrink.

Nonaccrual loans fell to $7.95 billion from $12.46 billion in the same quarter last year.

The bank’s share price has fallen about 40 percent this year, in line with declines for other large banks.

Citigroup shares rose 1 percent in premarket trading to $28.67 after the quarterly results were announced.