Leading Banks Post Solid Profit Gains in Third Quarter
A number of the nation’s leading banks on Tuesday reported solid gains in profit in the third quarter.
Wells Fargo, which recently acquired First Interstate Bancorp, reported earnings of $321 million, or $3.23 a share, compared with $261 million, or $5.23, for the third quarter of 1995.
Because the acquisition took effect April 1, the San Francisco-based banking giant said its quarterly performance isn’t comparable to that of a year earlier. The results were well below analysts’ expectations of $3.80 per share.
For the nine months, Wells earned $948 million, or $11.42 a share, compared with $726 million, or $14.14 a share, a year ago.
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Chase Manhattan, the nation’s largest banking company, reported that third-quarter earnings rose 12% to $858 million, or $1.80 a, from $764 million, or $1.58 a share, a year earlier.
Chase said it was ahead of schedule on saving costs since the merger with Chemical Banking.
The results, which included $20 million of special charges for merger expenses, were below analysts’ estimates of $1.82 a share.
Separately, New York-based Chase announced that it will buy back up to $2.5 billion of its common stock, or nearly 7%, through 1998.
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New York-based Citicorp’s third-quarter earnings rose 7%, helped by good returns from both its consumer and corporate worldwide banking businesses, although the report also revealed sharply higher spending for corporate banking in emerging markets, as well as higher spending for consumer banking.
The nation’s second-largest bank earned $935 million, or $1.85 a share, compared with $877 million, or $1.79 a share.
The earnings included a one-time charge of $40 million to help recapitalize the savings and loan system and were 2 cents a share below analysts’ expectations.
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The nation’s fifth-largest bank, NationsBank, said profit rose 18% to a record $625 million, or $2.12 a share, in the third quarter, from $530 million, or $1.95, in the year-ago quarter.
The results were well above average estimates of $2.05 a share.
At a Glance:
Mattel’s third-quarter earnings rose a better-than-expected 11% on robust sales of Barbie dolls, Hot Wheels cars and Cabbage Patch Kids dolls. The world’s largest toy company said net income rose to $168 million, or 61 cents a share, from $151.3 million, or 53 cents, a year earlier. That beat analysts’ estimates by 2 cents a share.
Coca-Cola said its profit rose 21% in the third quarter to $967 million, or 39 cents per share, for the three months ended Sept. 30, up from $802 million, or 32 cents, in the year-earlier period.
PepsiCo reported a 77% decline in profit for the third quarter, earning $144 million, or 9 cents a share, for the three months ended Sept. 7, compared with $617 million, or 39 cents, a year ago.
Eastman Kodak said third-quarter profit jumped 21% to $410 million, or $1.22 per share, compared with $338 million, or 99 cents, in the 1995 quarter.
Polaroid reported its first profit in a year, posting third-quarter net income of $34.2 million, or 74 cents a share, up 44% from $23.7 million, or 51 cents, in the same period last year.
Hilton Hotels said third-quarter earnings more than doubled, rising to $54.5 million, or 28 cents a share, from $24.8 million, or 13 cents, in the year-earlier period.
Sun Microsystems reported slightly better-than-expected first-quarter earnings of $123.4 million, or 63 cents a share, from $84.7 million, or 42 cents, in the year-ago quarter.
Sprint said third-quarter profit rose 16% to $312.4 million, or 72 cents per share, compared with $268.5 million, or 76 cents, in the same quarter a year ago.
Ameritech’s third-quarter profit rose 12% to $519 million, or 94 cents a share, from $464 million, or 84 cents, a year ago.
Amgen said third-quarter earnings rose 23% to $179 million, or 64 cents a share, from $146 million, or 52 cents, in the year-earlier period.
LA Gear said that for its third quarter ended Aug. 31 it recorded a net loss of $4.8 million, or 21 cents per share, contrasted with net income of $400,000, or 2 cents, in the year-earlier quarter.
Federal Home Loan Mortgage, or Freddie Mac, said its third-quarter earnings rose 14% to $312 million, or $1.65 a share, from $278 million, or $1.45, in the year-ago period.
Reynolds Metals reported that third-quarter earnings plunged 77% and said it will cut 1,060 jobs under a plan to boost profit. The company reported net income of $26 million, or 26 cents a share, compared with $112 million, or $1.56, a year ago.
Raytheon reported a 6% decline in third-quarter earnings, earning $187.9 million, or 80 cents per share, compared with $200.7 million, or 82 cents, in the year-ago period.
Merrill Lynch said third-quarter profit rose 10% to $331 million, or $1.69 a share, from $300 million, or $1.47, in the year-ago quarter.
PaineWebber Group said third-quarter earnings rose 2.5% to $80.2 million, or 79 cents a share, from $78.2 million, or 71 cents, last year.
Honeywell’s third-quarter earnings rose a better-than-expected 20% to $101.1 million, or 80 cents a share, from $84.2 million, or 66 cents, a year earlier.
Caterpillar said its profit for the third quarter climbed a better-than-expected 46% to $310 million, or $1.61 a share, compared with $213 million, or $1.07, in the year-ago quarter.
Black & Decker said third-quarter profit from continuing operations rose 72% to $55.7 million, or 59 cents a share, compared with $43.5 million, or 46 cents, last year.
Weyerhaeuser said third-quarter net income fell 57% to $119.7 million, or 60 cents a share, for the quarter ended Sept. 29, contrasted with profit from operations of $279.3 million, or $3.58, for the third quarter of 1995.
Louisiana-Pacific said third-quarter profit from operations fell 81% to $11.6 million, or 11 cents a share, from $62.7 million, or 59 cents, a year ago.
