posted strong third-quarter earnings Wednesday but warned that fourth-quarter profits would fall shy of Wall Street estimates.
For the quarter ended Sept. 30, the New York-based services conglomerate earned $593 million, or 56 cents a share. That's up from the year-ago continuing operations earnings of $486 million, or 47 cents a share, and a penny ahead of the analyst consensus estimate published by Thomson First Call.
Cendant said latest-quarter earnings were aided to the tune of 2 cents by the early termination of a contractual relationship in the marketing services segment. That gain was offset by the negative impact of Florida hurricanes and the "adverse consequences to the company's mortgage business arising from our announcement that we were exploring strategic alternatives for that business."
Revenue rose 5% from a year ago to $5.36 billion, as the company cited strong performances at its real estate franchise and brokerage businesses, double-digit growth at its hospitality businesses and continuing margin improvement in car rental.
"In addition to another quarter of record results, we also have made substantial progress toward our strategic objective to focus on our core travel and real estate businesses, reduce complexity and increase financial transparency," finance chief Ronald Nelson said, noting the company's pending acquisition of online travel site
, the spinoff of its Jackson Hewitt tax business and its plans for a mortgage venture. "We believe these actions will both enhance the company's growth rate and help to unlock shareholder value."
But the company also said the fall would be weaker than Wall Street was expecting. Cendant forecast fourth-quarter earnings of 32 to 33 cents a share, which is shy of the 35-cent analyst consensus, and $1.70 to $1.71 this year on a continuing operations basis, again about 2 cents shy.
Late Wednesday, Cendant slipped 77 cents to $21.70.