Financial Firms Report Strong 1st Quarter

Chase Manhattan Corp., Bank One Corp. and Wells Fargo & Co. on Tuesday reported higher first-quarter earnings, beating or meeting analysts’ estimates, as a strong U.S. economy and rising markets boosted income from lending and asset management.

Washington Mutual Inc., the largest U.S. savings and loan, said first-quarter earnings rose 18% as a buoyant domestic economy fueled consumer and business loan growth.

Profit, before a charge, rose to $459.1 million, or 79 cents a share, from $389.8 million, or 68 cents, a year earlier. The earnings beat the average forecast of 77 cents a share from analysts surveyed by First Call Corp., the first time the thrift has exceeded estimates in a year.

Seattle-based Washington Mutual, which bought Irwindale-based H.F. Ahmanson & Co. for $6.9 billion in October, took a merger-related charge of $15 million, or 3 cents a share. Net income, including the charge, rose to $444.1 million, or 76 cents a share, from $370.8 million, or 64 cents, a year earlier.

At Chase, the second-largest U.S. bank, profit rose a greater-than-expected 11% on gains from consumer banking and securities trading. Bank One, the No. 5 bank, met analysts’ estimates as earnings rose 12% on higher credit card and investment fees. No. 7 Wells Fargo beat expectations as profit rose 29% on higher mortgage fees.

In New York Stock Exchange trading, Chase shares fell $2 to close at $83; Bank One fell 25 cents to $59; and Wells Fargo rose $1.25 to $42.38. Washington Mutual shares rose $1.75 to $41.75, also on the NYSE.

At New York-based Chase, first-quarter net income rose to $1.17 billion, or $1.32 a share, from profit from operations of $1.05 billion, or $1.17 a share, in the same period last year. Analysts expected earnings of $1.25 a share.

Bank One said its first-quarter profit from operations rose to $1.05 billion, or 88 cents a share, from $933 million, or 78 cents, in the year-earlier period.

Wells Fargo’s net income rose to $884 million, or 53 cents a share, from $684 million, or 41 cents, a year ago. Analysts expected earnings of 50 cents a share.

At a Glance

Other earnings, excluding one-time gains and charges unless noted:

Airlines: UAL Corp., parent of United Airlines, said first-quarter profit at the No. 1 carrier fell 14% because of competition overseas. Southwest Airlines Co. and America West Holdings Corp. said earnings rose as U.S. travel demand increased.

Northwest Airlines Corp., the No. 4 carrier, lost money after storms in January forced it to cancel flights.

All four airlines performed better than analysts expected, bolstered by a 3.7% increase in U.S. traffic and fuller planes.

UAL said first-quarter profit slid 14% to $187 million, or $1.54 a fully distributed share, from $218 million, or $1.68, in the year-earlier quarter. Earnings topped the highest per-share estimate of $1.50 from analysts surveyed by First Call Corp. Revenue rose 2.8% to $4.16 billion from $4.06 billion.

Northwest reported a narrower-than-expected first-quarter loss of $46.3 million, or 58 cents a share, contrasted with profit of $71 million, or 66 cents, a year ago. The carrier was expected to lose 75 cents a share. Revenue fell 6.1% to $2.28 billion from $2.43 billion.

Southwest, the world’s biggest low-fare airline, said first-quarter profit jumped to $102.2 million, or 29 cents a share, from $70 million, or 20 cents a split-adjusted share, a year ago. That exceeded the 26-cent average estimate by analysts. Revenue rose 14% to $1.08 billion, from $942.7 million.

America West’s profit rose to a record $25.9 million, or 63 cents a share, from $25.1 million, or 53 cents, last year. Earnings topped estimates of 61 cents. Revenue rose 7.5% to $519.6 million from $483.2 million.

Drugs: Schering-Plough Corp. and Johnson & Johnson reported higher first-quarter profits as the popularity of prescription benefit plans helped boost sales. American Home Products Corp., though, said sales rose less than 1%.

Schering-Plough’s first-quarter profit rose 20% to $539 million, or 36 cents a share, from $450 million, or 30 cents, a year ago. Results matched analysts’ estimates. Sales rose 15% to $2.19 billion, from $1.9 billion a year ago.

Johnson & Johnson said earnings rose 12% to $1.13 billion, or 82 cents a share, from $1.01 billion, or 73 cents, in the year-ago period. The results surpassed estimate. Sales rose 15% to $6.6 billion from $5.8 billion.

American Home Products said its profit from operations rose less than 1% to $654.9 million, or 49 cents a share, from $651.4 million, or 49 cents, a year ago. Results matched estimates. Revenue fell 6.1% to $3.4 billion, from $3.7 billion.

Telecommunications: Sprint Corp., BellSouth Corp., Ameritech Corp. and SBC Communications Inc. had strong gains in first-quarter profit as U.S. phone customers bought extra services such as voicemail and businesses used more high-profit data services.

Chicago-based Ameritech said profit from operations rose to $705 million, or 63 cents a share, from $590 million, or 53 cents, a year ago. That was in line with the 62-cents average estimate. Revenue rose 7.8% to $4.46 billion from $4.13 billion.

San Antonio-based SBC said first-quarter profit was $1.1 billion, or 56 cents a share, compared with profit from operations of $970 million, or 49 cents, in the year-ago period. Earnings matched analysts’ estimates. Revenue rose 6.7% to $7.3 billion from $6.9 billion, led by strong growth in wireless, data services and enhanced services.

Atlanta-based BellSouth said first-quarter profit rose 12% to $895 million, or 46 cents a share, from $796 million, or 40 cents, in the year-earlier period. The results were in line with the 45-cents average estimate. Sales rose 10% to a record $5.97 billion from $5.43 billion.

Westwood, Kan.-based Sprint said net income was $406.2 million, or 93 cents a share, compared with profit from operations of $355.9 million, or 81 cents, a year ago. Analysts had expected Sprint to earn 90 cents. The No. 3 long-distance company said revenue rose 16% to $4.72 billion from $4.08 billion.

Other Industries: Philip Morris Cos., the world’s largest tobacco company, said first-quarter profit rose just 1.4%, hurt by discounts on cigarettes and payments for the industry’s $206-billion lawsuit settlement with states.

Profit from operations rose to $1.96 billion, or 80 cents a share, from $1.93 billion, or 79 cents, a year ago. It met estimates. Revenue rose 6.1% to $19.5 billion from $18.4 billion.

* Texas Instruments Inc. reported a sharp increase in first-quarter profit, beating Wall Street expectations, rising to $233 million, or 58 cents a share. That was up from a profit of $11 million, or 3 cents, a year ago, when results were hurt by one-time charges. Revenue fell to $2.04 billion from $2.19 billion.

* Lockheed Martin Corp., the world’s second-biggest aerospace company, said first-quarter profit fell 28% to $194 million, matching estimates of 51 cents a share, before taking a charge that caused a loss in the quarter. A year earlier, Lockheed Martin had net income of $269 million, or 71 cents. Revenue fell slightly to $6.19 billion from $6.22 billion.