Thursday's Earnings Roundup
- Exxon Mobil (XOM) reported second-quarter adjusted earnings of 84 cents a share, coming up short of the Thomson Reuters average estimate of $1.02 a share. Revenue dropped 46% from a year ago to $74.46 billion, but still came in ahead of the $71.29 billion consensus. Excluding the impacts of entitlement volumes, OPEC quota effects and divestments, Exxon said oil production was down about 2.5%.
- Travelers Companies (TRV) said it had second-quarter earnings of $1.25 a share on an operating basis, just shy of the analyst consensus of $1.28 a share. Revenue slipped 2% from a year ago to $6.16 billion, in line with estimates. Travelers raised its operating income forecasts for 2009 to $4.80 to $5.05 a share, an increase from its previously announced range of $4.55 to $4.95
- MasterCard (MA) swung to a second-quarter profit of $2.67 a share, well ahead of the Thomson Reuters consensus estimate of $2.42 a share. Revenue rose 2.7% to $1.28 billion, also coming in better than Wall Street forecasted.
- Sony (SNE) reported a loss of 37.1 billion yen ($390.5 million) in its fiscal first quarter. The result for the quarter was a reversal from the 35 billion yen profit in the year-ago period. Sales dropped 19.2% from a year earlier to 1.56 trillion yen.
- Motorola (MOT) reported a second-quarter adjusted loss of a penny a share, better than the Thomson Reuters estimate for a loss of 4 cents a share. Revenue tumbled 32% to $5.5 billion, mostly in line with consensus. The handset maker said third-quarter earnings should be in a range from a loss of a penny a share to a profit of a penny a share, while analysts expect a profit of a penny a share.
- Dow Chemical (DOW) said it would have earned 5 cents a share in the second quarter, excluding certain items such as restructuring charges. Analysts had expected a loss of 9 cents a share, according to Thomson Reuters. Sales fell to $11.32 billion from $16.35 billion last year, falling short of the $13.02 billion consensus.
- International Paper (IP) reported second-quarter earnings of 20 cents a share, compared with analysts' expectations that the company would break even. Revenue slipped 0.1% from a year ago to $5.8 billion, in line with the Thomson Reuters average estimate.
- Kellogg (K) notched second-quarter earnings of 92 cents a share, better than Wall Street's consensus target of 83 cents a share. Revenue slid 3.4% from the year-ago quarter to $3.23 billion, just shy of the $3.27 billion analysts were looking for.
Thursday's Early Headlines
- Citi Sells Nikko Asset Management. - Citigroup (C) agreed to sell its asset management operations in Japan to Sumitomo Trust and Banking in a deal that values the business at 120 billion yen ($1.26 billion). The sale of Nikko Asset Management is expected to close in the fourth quarter, Citigroup said Thursday. The sale isn't expected to have a "material impact" on Citigroup's net income, the bank said
- FDIC Set to Split Failed Banks to Lure Buyers. - The Wall Street Journal reported that the Federal Deposit Insurance Corp. is poised to start breaking failed financial institutions into good and bad pieces in an effort to drum up more interest from prospective buyers. The report said the FDIC's plan is aimed at selling the most distressed parts of failed banks to private-equity firms and other investors who may be more willing to take risks on bad assets. Traditional banks could then bid on the appealing assets of the failed institution, including deposits and branches.
- Shell Doesn't See Quick Recovery. - Europe's largest oil company Royal Dutch Shell (RDS.A) said second-quarter earnings fell 67% to $3.8 billion from $11.56 billion a year earlier as oil prices fell and energy demand remained weak.
- Merck to Sell Merial Stake to Sanofi. - Merck (MRK) signed an agreement to sell its 50% interest in the Merial animal health joint venture for $4 billion in cash to its venture partner Sanofi-Aventis (SNY). Sanofi will own 100% of Merial once the transaction closes. The acquisition is expected to be accretive to Sanofi's adjusted net income from the first year.
- Cablevision Moving Forward with MSG Spinoff. - Cablevision (CVC) announced that its board of directors has authorized the company's management to move forward with the spin-off of the Madison Square Garden business to Cablevision stockholders. The transaction would be structured as a tax-free pro rata spin-off to Cablevision's existing shareholders and is expected to be completed by year-end 2009, subject to necessary approvals, Cablevision said.