Earnings Reports for Oct. 25
— --
AT&T Tops Estimates; Announces Restructuring
AT&T, the biggest U.S.long-distance telephone company, said today itsthird-quarter earnings fell 12 percent, but topped WallStreet’s reduced expectations, as declining long-distance salesto residential customers offset strong wireless and datasales.
As New York-based AT&T unveiled a complex reorganization,the company said profits, excluding one-time items, fell to$1.44 billion, or 38 cents a share, compared with $1.63billion, or 50 cents a share, a year ago.
The results beat Wall Street’s tempered forecast of 36cents a share, according to research firm First Call/ThomsonFinancial. AT&T in May cut its growth forecasts for the rest ofthe year, citing faster-than-expected declines in sales oftelephone services to residential customers and sluggish salesto corporate customers.
Including one-time items, AT&T’s third-quarter net incomefell 19 percent to $1.32 billion, or 35 cents a share. Revenuesrose 4 percent to $16.98 billion.
Sales of communications services to consumers fell 11percent to $4.67 billion as AT&T continued to suffer fromincreased competition and price wars. Sales to corporatecustomers rose 2.5 percent to $7.11 billion. The company added750,000 wireless subscribers from a year ago. Cable-basedtelephone subscribers totalled 350,000 in the third quarter, upfrom 224,000 in the second quarter.BACK TO TOP
Viacom’s Profits Fall
Viacom reported today third-quarter earnings that topped expectations amid strong advertising growth at the media and entertainment giant, but profits were down from a year earlier, reflecting highertaxes and costs from its CBS purchase.
The New York-based company, whose properties include theMTV cable network and Paramount Studios, said net incomedropped to $33 million, or 2 cents a share, from $97 million,or 14 cents, in the same period last year.
Analysts on average had expected the company to post a lossof 2 cents a share, according to First Call/Thomson Financial.
Revenues rose 79 percent to $6 billion from $3.3 billion,powered by strong advertising revenue growth, especially atCBS, the broadcaster that scored a big hit with the TV showSurvivor, and its cable and radio operations.
“The quarter was fueled by double-digit ad sales growthacross the board, spurred by such ratings triumphs as CBS’ Survivor, which generated significant prime-time audience gainsat CBS, and MTV’s Video Music Awards, this year’s highest-ratedcable entertainment program,” Sumner Redstone, Viacom chairmanand chief executive said in a statement.
Pro forma revenues, which take into account the CBSacquisition, rose 7 percent to $6 billion from $5.6 billion inthe third quarter of 1999. Pro forma revenues at the companycable networks rose 13 percent to $1 billion, led bydouble-digit increases in ad revenues at MTV.
Infinity Broadcasting, in which Viacom acquired a majoritystake when it took over CBS, posted pro forma revenues of $1billion, up 12 percent on the year
Television pro forma revenues were also boosted by strongad revenue growth, up 3 percent to $1.8 billion.
The company’s entertainment division saw more moderategrowth of 2 percent to $792 million. Merrill Lynch analystJessica Reif Cohen had forecast slower entertainment revenuegrowth because of weaker attendance at Paramount Parks becauseof rainy weather conditions.
Third-quarter earnings before interest, taxes, depreciationand amortization (EBITDA) rose to $1.4 billion from $540million a year earlier. It said it was on track to deliverfull-year EBITDA of $5 billion and expects to achieve EBITDAgrowth of 20 percent for all of 2001.
Analysts say Viacom has positioned itself well to gainmajor advertising revenue from shows like “Survivor,” whichshould protect it from an expected slowdown in the advertisingmarket in the fourth quarter and next year.
Shares of Viacom closed up 7/16 at $56-1/2 on the New YorkStock Exchange on Tuesday. They have traded at a 52-week low of$41-11/16 and a 52-week higher of $76-1/16.BACK TO TOP
DuPont Lowers Outlook
DuPont reported third-quarterearnings of 51 cents a share today, matching the expectationof analysts, but lowered its outlook for the year, warning thatrising oil prices will hurt profits.
Analysts surveyed by First Call/Thomson had predicted earningsof 51 cents per share, 8 cents lower than the same period lastyear, for the nation’s largest chemical company.
For the first nine months of the year, DuPont reported earningsof $2.26, compared to $2.02 for the same period last year.
Charles O. Holliday Jr., DuPont chairman and chief executive,cited rising raw material costs and a slowing global economy inissuing the lowered earnings outlook for the rest of 2000.
The announcement marked the second time in two months thatDuPont has lowered its outlook. In June, the company predictedearnings of $3.01 for the year, but lowered its estimate inSeptember to between $2.85 and $2.95.
Holliday said today that $2.85 is the best the companycan expect for the year — and warned it may be lower.
“We are cautious about the prospects for top-line growth in thefourth quarter,” Holliday said.
DuPont stock closed Tuesday at $42.88, up $2.19, on the New YorkStock Exchange.
Like other large U.S. manufacturers, DuPont is struggling withskyrocketing prices for oil and natural gas. DuPont buys about $11billion worth of raw materials annually, about 40 percent of whichare oil and gas.
DuPont’s largest users of the hydrocarbons are its nylon andpolymer plants.
Holliday also warned that a strong U.S. dollar overseas and theend of a sales promotion program in the company’s pharmaceuticaldivision could hurt DuPont earnings in the last three months of theyear.
Third quarter income from continuing operations was $537million, compared to $625 million in the third quarter of 1999, adrop of $88 million or 14 percent.
Third quarter 2000 consolidated sales of $6.4 billion were flatversus third quarter 1999.
The company reported higher sales volume, particularly in theAsia Pacific market, and higher selling prices, but those wereoffset by the higher raw material costs.BACK TO TOP
Clorox Q1 Net Rises 13%
Consumer productscompany Clorox said today that net income rose 13percent in its fiscal first quarter, as strong sales of homecare products and record summer demand for Kingsford charcoalhelped boost results.
The maker of Clorox bleach, Formula 409 cleaner and HiddenValley Ranch salad dressing said net income before a one-timecharge was $100 million, or 42 cents a share, in the quarterended Sept. 30. Including the charge, net income totalled $98million, or 41 cents a share. Last year the company had netincome of $87 million, or 36 cents per share.
Analysts on average had expected the company to reportearnings of 41 cents a share, according to market research firmFirst Call/Thomson Financial. A company spokesman could not beimmediately reached for comment.
Oakland, California-based Clorox, which also makes FreshStep cat litter and Glad plastic bags, said revenue rose 5percent to $985 million.
First-quarter results were in line with the company’s goalsof mid-single-digit revenue growth and low-double-digit earningsgrowth for the full year, Chairman and Chief Executive OfficerCraig Sullivan said in a statement.
BACK TO TOP
Related Stories
ABC News Live