Procter & Gamble soars past profit expectations

CINCINNATI, Thu Oct 25, 2012 – Procter & Gamble Co.’s profit rose more than expected, indicating that the world’s largest household products maker is making progress after coming under pressure from activist investor William Ackman, and its shares soared to the highest level in four years.

Rival Colgate-Palmolive), meanwhile, said it plans to cut about 6 percent of its workforce over the next four years as it strives to operate more nimbly as economies slow in many countries. Its quarterly profit matched expectations.

Several consumer goods makers are trimming jobs, including P&G, as concerned consumers hold off on some purchases and growth slows in major markets such as China.

P&G is on track to cut 4,200 jobs by the end of October on its way to eliminating 5,700 jobs by the end of its fiscal year. On Wednesday, Kimberly-Clark Corp. said it would eliminate 1,300 to 1,500 jobs as it leaves some low-margin businesses in Europe. Colgate’s plans, including moving away from single-country units toward regional hubs, should lead the toothpaste maker to trim about 2,300 jobs by the end of 2016.

Shares of P&G rose 4 percent to $70.83 on Thursday, their highest level since October 2008. Colgate’s shares fell 2.9 percent to $103.44.

“It wouldn’t surprise me if we’re seeing some people saying it is time to sell some Colgate, buy some Procter, given Colgate’s outperformance year to date,” said JP Morgan analyst John Faucher, who has a “neutral” rating on Colgate and an “overweight” rating on P&G.

Colgate’s shares had risen 15 percent this year through Wednesday, while P&G shares were up less than 1 percent.

Conoco quarterly profit dips, but beats estimates

HOUSTON, Thu Oct 25, 2012 – ConocoPhillips reported a lower third-quarter profit on Thursday that beat analysts’ estimates, as it produced more crude than expected from high-margin fields such as the Eagle Ford and Bakken.

Shares of the U.S. oil and gas company rose 2 percent to $57.11 in premarket trading.

Conoco and other large oil companies like Exxon Mobil Corp. have been investing more heavily in North American shale formations like the Eagle Ford in south Texas and the Bakken in North Dakota in a bid to boost higher-priced oil production.

“The ramp up in the Eagle Ford is on track or exceeding the market’s expectations,” said Fadel Gheit, oil analyst at Oppenheimer. “They delivered on everything they said they would, and more.”

Third-quarter profit was $1.8 billion, or $1.46 per share, compared with $2.6 billion, or $1.91 per share, in the same period a year earlier.

Excluding items related to asset sales and taxes, the Houston-based company had a profit of $1.44 per share. Analysts on average had expected $1.19.

Oil and gas output in the quarter was 1.53 million barrels of oil equivalent per day, down from 1.54 million a year earlier. Analysts at Barclays had forecast 1.52 million BOE per day.

Conoco said its fourth-quarter production will increase on a sequential basis, as the company speeds the pace of drilling in the Eagle Ford and more output is expected from its Canadian oil sands properties.

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.”

Toy maker Hasbro profit tops estimates; sales miss

Pawtucket, R.I.,,Mon Oct 22, 2012 – Hasbro Inc. topped Wall Street profit expectations on Monday as better inventory management helped offset weak sales at the second-largest U.S. toymaker.

The news came after larger rival Mattel Inc. also reported a higher-than-expected quarterly profit, helped by price increases and cost controls. The maker of Barbie dolls and Hot Wheels cars said it was well-positioned for the holidays.

Hasbro, whose brands include Monopoly, G.I. Joe, Nerf and Mr. Potato Head, has been working with its U.S. retail partners to better manage inventories this year. It has been trying to shift toy deliveries closer to peak demand periods.

It struggled during the 2011 holiday season when demand in the United States and Canada tapered off after a strong start to what is typically the biggest selling season of the year.

On Monday, Hasbro CFO Deborah Thomas said it plans to step up its marketing efforts in what she described as “an environment of significantly lower U.S. retail inventory.”

The toymaker said it expects to “grow revenues and earnings per share” for the full year 2012, excluding the impact of foreign exchange.

Net profit in the third quarter fell to $164.9 million, or $1.24 a share, from $171.0 million, or $1.27 per share, a year earlier. Analysts on average expected $1.20 per share, according to Thomson Reuters I/B/E/S.

The weakening euro zone is the “most significant” risk to the company’s 2013 outlook, executives said. In an interview with CNBC, Oberhelman said, though, that China appeared “to be on the edge of something of a recovery.”

Shares fell 1.1 percent to $82.92 in premarket trading.

For the third quarter, the company posted profit of $1.7 billion, or $2.54 per share, compared with $1.14 billion, or $1.71 per share, in the year-ago period.

Excluding one-time items, the company earned $2.26 per share. By that measure, analysts expected $2.22, according to Thomson Reuters I/B/E/S.

Union Pacific profit up 15 percent on chemical, auto shipments

OMAHA, Neb., Thu Oct 18, 2012 – Aircraft Union Pacific Corp. posted a 15 percent rise in profit as an increase in the largest publicly traded U.S. railroad’s shipments of freight, including autos, offset weak coal shipments.

The company said on Thursday third-quarter profit was $1.04 billion, or $2.19 per share, compared with $904 million, or $1.85 per share, a year earlier. Earnings were a penny per share higher than analysts’ average forecast of $2.18 a share, according to Thomson Reuters I/B/E/S. Revenue rose 4.7 percent to $5.34 billion, from $5.1 billion, a year earlier. Wall Street had anticipated $5.38 billion.

The company reported a 12 percent drop in coal volumes, reflecting a long slump in shipments that has affected U.S. railroads since the mild winter of 2011-2012. Strong shipments of chemicals and autos helped offset that decline. Smaller railroad CSX Corp. on Tuesday reported a 2 percent decline in third-quarter profit as coal shipments fell 16 percent.

Coal volume has been off since the mild winter of 2011-12 and CSX officials said they expect that weakness to continue into next year, by which time utilities will have burned off their inventories. Union Pacific shares are up about 38 percent over the past year, sharply outpacing the 13 percent rise of the Dow Jones transportation average.

Goldman Sachs revenue more than doubles on investment gains

NEW YORK, Tue Oct 16, 2012 – Goldman Sachs Group Inc. reported a third-quarter profit, reversing a year-earlier loss, as revenue more than doubled due to gains in stocks and bonds the investment bank holds as investments.

Goldman on Tuesday posted earnings applicable to common shareholders of $1.5 billion, or $2.85 per share, compared with a loss of $428 million, or 84 cents per share, a year earlier. Net revenue rose to $8.35 billion from $3.6 billion.

Analysts had expected, on average, earnings of $2.12 per share, according to Thomson Reuters I/B/E/S.

Most of Goldman’s revenue gains came from its investing and lending division, which consists of stocks and bonds it holds as investments. The value of those assets rose after the U.S. Federal Reserve unveiled a new program to boost liquidity, but trading volumes and deal activity were still muted.

The bank reported $1.8 billion in revenue from that business; a year earlier, the investing and lending division reduced overall revenue by $2.5 billion.

In a statement, Goldman Chief Executive Lloyd Blankfein described the bank’s third-quarter performance as “generally solid.”

Goldman shares were up 50 cents to $125.00 in premarket trading.

Schwab profit up 12 percent; to buy asset manager

NEW YORK, Mon Oct 15, 2012 – Charles Schwab Corp. said higher asset management revenues helped boost third-quarter profit 12 percent, and the U.S. brokerage announced plans to buy smaller asset manager ThomasPartners Inc.

Brokerages like Schwab have been under pressure due to soft equity trading as uncertainty over Europe’s debt problems, the state of the U.S. economy, and the upcoming U.S. election keep many retail investors on the sidelines. Years of ultra-low interest rates have also been a drag on profits.

San Francisco-based Schwab on Monday said it earned $247 million, or 19 cents a share, in the third quarter, up from $220 million, or 18 cents a share, a year earlier.

The latest results included a nonrecurring tax benefit of about $20 million. Excluding that benefit, earnings were about 17 cents a share, in line with analysts’ average estimate, according to Thomson Reuters I/B/E/S.

Revenue rose 1 percent to $1.2 billion.

Shares of Schwab were up 5 cents at $13.00 in midday trading in New York.

Schwab said it had struck a deal to buy money manager ThomasPartners, which focuses on dividend income, as it anticipates growing demand for income-oriented investment strategies. The deal includes an $85 million cash payment and possible future payments based on growth in assets under management.

“We think this acquisition is further evidence of Schwab’s push to increase fee-based advisory products in an effort to increasingly ‘annuitize’ its revenue stream in a low-rate backdrop,” said Keith Murray, an analyst at Nomura Equity Research.

ThomasPartners managed $2.3 billion in assets as of September 30, in largely growth-oriented investment portfolios designed to generate dividend income streams. The firm already uses Schwab as a custodian for its assets.

FedEx lowers 2013 profit view, plans air cost cuts

MEMPHIS, Tenn., Tue Sep 18, 2012 – FedEx Corp. lowered its fiscal 2013 profit target on Tuesday, saying earnings could slide as much as 6 percent for the year, as a weakening world economy prompts customers to shift toward lower-priced and slower shipping options.

The world’s second-largest package delivery company said makers of electronics and mobile phones had begun to move more of their cargo on ships as pressure on their selling prices makes the cost of air freight harder to bear.

“A lot of traffic is moving onto the water because moving goods by air is very energy-intensive,” Chief Executive Officer Fred Smith told investors on a conference call. “You can’t have jet fuel going up to close to $4 a gallon on occasion without it having a big effect on the choices people make.”

The Memphis, Tennessee-based company plans to take a “significant amount of cost” out of its express air freight operation, Smith said. It will provide details at an October investor meeting, but does not plan layoffs or “draconian steps,” he added.

Smith founded the company in 1971 as an air shipper, but today it moves a large amount of goods by truck.

FedEx said it expected a profit of $6.20 to $6.60 per share for its fiscal year, which ends in May. That is below both its prior forecast of $6.90 to $7.40 and Wall Street’s estimate of $7.03.

FedEx’s larger rival, United Parcel Service Inc., had cut its 2012 profit forecast in July, but the midpoint of the revised range would still represent roughly 9 percent growth.

FedEx’s shares fell 1.7 percent to $87.78 on the New York Stock Exchange.

Chevron profits slip with oil price dip

RAMON, Calif., Fri Jul 27, 2012 – Chevron Corp., the second-largest U.S. oil company, reported a lower quarterly profit on Friday as oil prices weakened from a year earlier, though fatter refining margins cushioned the blow.
Second-quarter net income fell to $7.2 billion, or $3.66 per share, from $7.7 billion, or $3.85 per share, in the year-ago quarter.
The company’s upstream business – oil and gas production – posted an 18 percent profit drop to $5.6 billion, while its downstream refining business saw profit jump 80 percent to $1.88 billion.
Chevron said earlier this month that industry benchmark margins on the Gulf Coast rose more than $4 per barrel to $24.89, while West Coast margins improved to $21.32 per barrel, their highest three-month average in four years.
Chevron’s largest refinery is in Mississippi, with 330,000 barrels per day of capacity, while its two California plants can together refine 518,000 bpd.
Profits at larger rival Exxon Mobil Corp. fell short of expectations on Thursday as oil and gas output sagged and its chemical unit faced weak margins.
Shares in Chevron rose less than 1 percent in premarket trading.

United Tech beats Wall Street in quarter, gets Goodrich OK

HARTFORD, Conn., Thu Jul 26, 2012 – United Technologies Corp. posted second-quarter profit on Thursday that trounced analysts’ expectations, and won final regulatory approval for its $16.5 billion takeover of Goodrich Corp (GR.N), setting the stage for the deal to close by Friday.
The higher-than-expected profit overshadowed the company’s warning that full-year earnings would be roughly flat with 2011 due to the weak European economy.
The world’s largest maker of elevators and air conditioners said it would step up its planned restructuring spending to $500 million this year from a prior $450 million target, as it copes with a slowing economy.
“It is certainly a challenging environment out there, with a slowing global economy,” said CEO Louis Chenevert, on a conference call with analysts. “We know how to operate in a touch macroeconomic environment.”
The company’s better-than-expected profit came despite a sharper-than-expected decline in sales. Fellow blue chip 3M Co. also beat quarterly earnings forecasts despite light revenue thanks to tight spending controls.
“Good execution trumped the tough environment,” said Edward Jones analyst Matt Collins, in reference to United Tech. “Strong performances across the businesses more than offset the weakness at Otis, Commercial Climate & Security and Pratt & Whitney.”
United Tech’s Commercial Climate & Security arm includes Carrier air conditioner and its alarm products.