Marathon, Conoco Beat Estimates
USX-Marathon Group and Conoco Inc., the first of the top five U.S. oil companies to report second-quarter earnings, had better-than-expected profit on robust prices for natural gas, crude oil and fuel.
Marathon, the nation’s fourth-largest oil company, said profit jumped 59% to $582 million, or $1.88 a share, well above the $1.52-a-share average estimate of analysts polled by First Call/Thomson Financial. Revenue rose 5.4% to $9.18 billion.
Conoco, the No. 5 oil company, reported a 32% rise in earnings to $606 million, or 95 cents, easily beating First Call’s 85-cent average estimate. Sales rose 9.8% to $10.4 billion.
Both companies benefited from stronger profit margins at their U.S. refineries.
The second quarter probably will be the last consecutive quarter of high refining margins, analysts said. Margins narrowed in June, and third-quarter profits are likely to fall as U.S. gasoline prices decline amid building inventories. Falling natural-gas prices also will cut profit, analysts said.
Marathon, a separately traded unit of USX Corp., said profit from refining and marketing rose 59% to $842 million. Profit from worldwide exploration and production rose 29% to $459 million.
Houston-based Conoco said that its worldwide profit from refining rose 61% to $227 million, even with an April fire at a refinery in Britain. In the U.S., refining profit more than doubled to $221 million. Profit from exploration and production rose 24% to $493 million.
Marathon stock rose 4 cents to $28.25. Class B shares of Conoco fell 21 cents to $28.27, both on the New York Stock Exchange.
Other earnings, excluding one-time gains or charges unless noted, include:
* American Express Co. said its second-quarter net income tumbled 76% to $178 million, or 13 cents a share, as it had warned they would, because of losses in its junk bond portfolio and a sluggish economy. Excluding a charge to write down the investment losses, earnings were $714 million, or 53 cents, the company said. Revenue fell 12% to $4.9 billion.
* Goodrich Corp., the largest U.S. maker of aircraft landing gear, said second-quarter profit from continuing operations rose 13% to $88.8 million, or 83 cents a share, missing forecasts by a penny. Sales rose 14% to $1.24 billion. The company also said full-year profit will be less than forecasts because of slowing demand for its industrial products.
* Goodyear Tire & Rubber Co., the largest U.S. tire maker, said its second-quarter earnings dropped 90% to $7.8 million, or 5 cents a share, because of sluggish demand from auto makers, but said it was comfortable with analysts’ earnings estimates for the second half of the year. The results met analyst expectations. Sales edged down 0.8% to $3.58 billion. The company said its market share of the tire replacement market jumped 30% on demand from consumers seeking to replace recalled Bridgestone Firestone brand tires.
* HCA Inc., the largest U.S. hospital chain, said profit grew 21% to $271 million, or 50 cents a share, better than the 46 cents analysts expected, on increased admissions and improved reimbursements from the government and health insurers. Revenue rose 8% to $4.47 billion.
* Hasbro Inc. posted a loss of $18.3 million, or 11 cents a share, compared with year-earlier profit of $6.5 million, or 4 cents, as sales fell 34% to $511 million. Analysts expected a deeper loss of 13 cents.
* Minnesota Mining & Manufacturing Co., whose businesses range from electronics to consumer products such as Post-it notes, said second-quarter profit declined 4% to $451 million, or $1.12 a share, because of growing weakness in its overseas markets and the strong U.S. dollar. The company, which is often considered an economic bellwether because of its broad product line, said sales fell 3.9% to $4.08 billion.
* Tupperware Corp.’s earnings rose 6% to $29.4 million, or 50 cents a share, on a 2.5% increase in revenue to $285.4 million. The seller of plastic household items also lowered its full-year outlook.
