Earning Plays

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Tuesday, Aug. 26
J. Crew second-quarter net income dips to 28 cents a share(4:20 pm ET)
SAN FRANCISCO (MarketWatch) -- J. Crew Group Inc. (JCG: news, chart, profile) late Tuesday reported its second-quarter net income fell to $18.1 million, or 28 cents a share, from $20.6 million, or 32 cents a share, a year earlier. Revenue increased to $336.3 million from $304.7 million in the same quarter last year, said the clothing apparel maker. Analysts surveyed by FactSet Research had forecast earnings of 33 cents a share, on average, and revenue of $337.7 million. The company forecasted earnings of 28 cents to 33 cents a share in the third quarter. Analysts are projecting the company to report third-quarter earings of 47 cents a share. Meanwhile, J. Crew lowered its earnings outlook for fiscal 2008 to a range of $1.44 to $1.54 a share from the previous view of $1.70 to $1.75 a share, citing a disruption in its direct business and softer store sales.
Credit Suisse ponders Janus upgrade(11:31 am ET)
NEW YORK (MarketWatch) -- Credit Suisse is considering upgrading Janus Capital Group's (JNS: news, chart, profile) stock from neutral. Analyst Craig Siegenthaler said that investor concerns regarding overweight positions in commodities in Janus funds are overblown, and pointed out that 87% of Janus' fund assets are in funds rated four and five stars by Morningstar. Credit Suisse is lowering earnings per share estimates for Janus in 2008 to $1.34 from $1.36 and in 2009 to $1.70 from $1.85, and forecast third quarter earnings per share of 33 cents, one cent above consensus. Earlier this month, analysts at J.P. Morgan downgraded Janus to underweight from neutral, citing concerns about Janus' funds being overweight in growth, international and commodities. In July, Janus report a 36% rise in second quarter profits to $66.3 million, or 41 cents a share, up from $48.8 million, or 27 cents a share, in 2007.
American Eagle Outfitters earnings per share fall 22%(8:09 am ET)
NEW YORK (MarketWatch) -- American Eagle Outfitters Inc. (AEO: news, chart, profile) said Tuesday that second-quarter earnings fell to $59.8 million, or 29 cents a share, from $81.3 million, or 37 cents a share, in the same period a year ago. Sales fell to $688.8 million compared to $703.2 million. Analysts polled by FactSet estimated, on average, earnings per share of 28 cents on sales of $711.9 million. Same-store sales were down 6% in August and down 9% for the quarter. The company sees third-quarter earnings per share in a range of 31 cents to 36 cents.
Smithfield Foods swings to 9-cents-a-share loss(7:27 am ET)
NEW YORK (MarketWatch) -- Smithfield Foods Inc. (SFD: news, chart, profile) said Tuesday that it lost $12.6 million, or 9 cents a share in the first quarter, compared to earnings of $54.6 million, or 41 cents a share, in the same period a year ago. Sales were $3.1 billion versus $2.6 billion a year ago. Analysts polled by FactSet Research, on average, estimated earnings per share of a penny on sales of $2.91 billion. The current quarter includes a 15-cents-a-share adjustment related to unrealized losses in open commodity derivative contracts and 4 cents a share loss related to asset disposals by Campofrio. Smithfield pointed to corn being diverted to ethanol production and the effect of high prices for feed. "This is a dynamic this industry has never faced. We believe this policy is flawed and needs to be revised if food cost inflation is to be brought under control," said Chief Executive Larry Pope.
Sanderson Farms swings to loss on 18% higher sales(6:49 am ET)
TEL AVIV (MarketWatch) -- Sanderson Farms Inc., (SAFM: news, chart, profile) the Laurel, Miss., chicken and prepared-foods producer, swung to a fiscal third-quarter loss from a year-earlier profit on 18% higher sales. For the quarter ended July 31, the loss was $3.6 million, or 18 cents a share, compared with net income of $30.7 million, or $1.51, in the year-earlier period. Revenue reached $466.9 million from $394.8 million. The latest quarter's share loss reflects a 9-cent payment to settle litigation. A survey of four analysts by FactSet Research produced a consensus estimate of a loss of 5 cents for the quarter. The results reflect relatively strong retail and export demand for chicken, but the company's casual-dining and food-service customers have been hurt as consumers cut back on going to restaurants due to the weak economy and costlier fuel, Chairman and Chief Executive Joe F. Sanderson Jr. said in a statement.
Update: Big Lots 2nd-period net up 11%; lifts outlook(6:24 am ET)
TEL AVIV (MarketWatch) -- Big Lots Inc., (BIG: news, chart, profile) the Columbus, Ohio, closeout retailer, reported fiscal second-quarter net income rose 11% on 1.9% revenue, and it lifted its estimate of earnings from operations for the full year. For the quarter ended Aug. 2, net income reached $26 million, or 32 cents a share, from $23.4 million, or 22 cents, in the year-earlier period. Continuing operations generated 32 cents a share against 21 cents. Revenue rose to $1.11 billion from $1.08 billion. A survey of analysts by FactSet Research produced a consensus estimate of 26 cents of profit for the latest quarter. Same-store sales -- which the company defines as revenue from stores open at least two years at the start of the fiscal year -- rose 2.8% in the period. For fiscal 2009, Big Lots now sees continuing operations generating $1.90 to $2 a share of profit, against an adjusted $1.41 for fiscal 2008. FactSet's survey is looking for $1.84. In late May, when Big Lots reported first-quarter earnings, the company estimated the year's earnings from continuing operations at $1.80 to $1.90. Same-store sales for the year should rise 2%, Big Lots estimated. (Adds specifics of outlook for the year plus FactSet estimate.)
Thornburg Mortgage profit climbs, makes margin calls(5:50 am ET)
LONDON (MarketWatch) -- Thornburg Mortgage (TMA: news, chart, profile) late Monday reported second-quarter earnings rose to $412.3 million, or 84 cents a share, from $83.4 million, or 66 cents a share, as a $537 million gain on a principal participation agreement and additional warrant liability offset a $210 million mortgage-backed securities portfolio impairment. Adjusted income was $22.7 million for the quarter. The company believes that absent further deterioration in the underlying loans, the current carrying value adequately reflects any inherent losses. It paid on Aug. 22 margin calls totaling approximately $219.0 million, "which may be less than the counterparties to the override agreement's interpretation."
CORRECT: Rio Tinto says profit climbed to $6.91B, up 113%(4:49 am ET)
HONG KONG (MarketWatch) -- Miner Rio Tinto (AU:RIO: news, chart, profile) (RTP: news, chart, profile) said Tuesday first-half net income more than doubled, helped by strong commodity prices and the earnings contributions from its 2007 takeover of Alcan. Net income climbed to $6.91 billion, from $3.4 billion a year earlier. Underlying earnings jumped 55% to $5.47 billion, from $3.53 billion. The miner proposed an interim dividend of 68 U.S. cents, up 31% from the 52 cents a year earlier. (Corrects to reflect that Rio Tinto bought Alcan.)
Virgin Atlantic posts first-quarter profit of GBP23.5M(3:30 am ET)
LONDON (MarketWatch) -- Virgin Atlantic, the British carrier controlled by billion Richard Branson, on Tuesday said first-quarter pretax profit came in at 23.5 million pounds ($43.3 million). Sales increased 16% to 645.3 million pounds. Load factor, a measure of how full an airline's planes are, rose to 77% from 74.8% in the year-earlier quarter. Virgin said it had gained passengers from rival British Airways (UK:BA: news, chart, profile) because of problems with the latter's Terminal 5 at London's Heathrow airport.
Bovis Homes' first-half profit, sales sink(2:44 am ET)
LONDON (MarketWatch) -- British homebuilder Bovis Homes Plc (UK:BVS: news, chart, profile) on Tuesday said first-half net profit fell to 6.89 million pounds, or 5.7 pence a share, from 41.05 million pounds, or 34.1 pence a share, earned in the year-earlier period. Sales declined to 149.3 million pounds from 260 million pounds a year earlier. The company declared an interim dividend of 5 pence a share, which it said was reflective of "challenging market conditions." Bovis said it considers that the current trading environment will continue for the foreseeable future, "with continued poor mortgage liquidity limiting housing market activity." It said it's committed to "competitive" net pricing such it can achieve volume delivery, but concluded that given current sentiment, this is likely to reduce private sales prices and profit margins achievable on incremental reservations over the rest of 2008.
Bunzl's first-half profit, sales rose(2:33 am ET)
LONDON (MarketWatch) -- British distribution firm Bunzl Plc (UK:BNZL: news, chart, profile) on Tuesday said first-half net profit rose 4% to 63.5 million pounds, or 19.8 pence a share, from 60.9 million pounds, or 18.1 pence a share, earned in the year-earlier period. Sales climbed 14% to 1.96 billion pounds, helped by solid organic growth and recent acquisitions. The company lifted its interim dividend by 11% to 6.45 pence a share. Looking ahead Bunzl said it expects organic revenue growth in North America to remain at a similar level to that in 2007 and the first half of 2008. It added that it would benefit from higher positive currency translation effects in the second half of the year due to the recent weakness of the pound.
Temasek says annual net profit doubled to $12.8 billion(2:05 am ET)
HONG KONG (MarketWatch) -- Singapore's $130 billion sovereign wealth fund, Temasek Holdings, reported Tuesday full-year profit doubled from the preceding year, owing to disposals of assets that more than offset declines in returns from global equities markets. Net income climbed to S$18.2 billion ($12.8 billion) in the year to March 31, up from S$9.1 billion in the year earlier, the fund said in its annual report. The fund made S$32 billion in new investments, more than double the S$16 billion a year earlier. Temasek reported asset sales of S$17 billion, compared to S$5 billion a year earlier.