Chevron 3Q Profit Plunges 26 Percent SAN RAMON, Calif. — Chevron Corp. third-quarter profit slid 26 percent, the steepest decline in five years as the energy market's unpredictable pendulum swung against the second-largest U.S. oil company and most of its peers.
The San Ramon-based company said Friday that it made $3.72 billion, or $1.75 per share, in the three months ended in September, down from net income of $5.02 billion, or $2.29 per share, at the same time last year.
Analysts were bracing for a lower profit, but the erosion was far worse than their average earnings estimate of $2.07 per share, based on a survey by Thomson Financial.
Revenue growth also was lackluster during the quarter, edging up just 2 percent to $55.2 billion.
The results weighed on Chevron stock, which fell 56 cents Friday to finish at $88.48. The shares still have gained 20 percent so far this year.
Chevron's performance hasn't deteriorated this much since the company suffered a loss of $904 million loss in the third quarter of 2002 after posting a $1.27 billion profit in the previous year. The 2002 loss stemmed from a soured investment.
In the latest quarter, higher oil prices pinched Chevron instead of providing the lift that has typified the past few years of record profits.
With fewer refineries out of commission and more motorists cutting back on driving in an apparent attempt to save money, the United States had an ample supply of gasoline through most of the summer.
That made it more difficult for Chevron and its biggest rivals to recover their higher oil costs at the gasoline pump.
As a result, the combined third-quarter profit of Chevron, Exxon Mobil Corp., ConocoPhillips, BP PLC and Royal Dutch Shell PLC fell 11 percent to $28.1 billion.
Royal Dutch Shell was the only company to post a higher third-quarter profit, but its management said its refining margins were weaker than it appeared.
The third-quarter conditions shifted so dramatically that Chevron wound up with a $110 million loss in its U.S. division that refines and sells gasoline. Chevron earned $831 million in the same "downstream" operations in last year's third quarter.
Management attributed much of the third-quarter setback to unusually low gasoline prices on the West Coast, where Chevron is a market leader.
While most of the industry's refineries were humming along, Chevron ran into some problems that exacerbated its earnings downturn. Besides shutting down part of its El Segundo, Calif. refinery for planned maintenance, Chevron lost some production after a mid-August fire at its Mississippi refinery. Chevron doesn't expect to fully repair the Mississippi refinery until next year.
With crude oil prices now above $90 per barrel, the fourth quarter looks like it will be even worse than the third quarter when prices mostly hovered between $60 and $70 per barrel, said Oppenheimer & Co. analyst Fadel Gheit.
Although gas prices have been climbing in recent weeks, Gheit thinks it's unlikely oil companies will be able to pass on all of their higher costs because doing so would risk weakening demand even further by causing motorists to drive even less and bogging down an already slowing economy.
"It's going to be bleak for refiners," Gheit said.
The outlook could change, though, if an unusually cold winter fuels greater energy demand or more refineries break down.
For now, Chevron remains on pace to produce a record annual profit for the fourth consecutive year. Through the first nine months of the year, Chevron had earned $13.81 billion, 3 percent ahead of a $13.37 billion profit last year.
As usual, Chevron made most of its money from oil production in the third quarter, but not as much as it did last year. The company's worldwide profit in its so-called "upstream" operations slipped 2 percent to $3.43 billion, a downturn that management attributed to lower production and higher operating expenses during the quarter.
Chevron produced an average of 2.6 million barrels of oil per day, down by about 100,000 barrels per day from last year.
Duke 3Q profit falls, raises year target November 02, 2007: 06:59 PM EST
Nov. 2, 2007 (Thomson Financial delivered by Newstex) --
CHARLOTTE, N.C. (AP) - Duke Energy Corp. (NYSE:DUK PRA) (NYSE:DUK) , one of the nation's largest electric power companies, said Friday its third-quarter profit fell 20 percent, reflecting the spin-off of its natural gas operations.
But the Charlotte-based company, which serves about 4 million customers in the Midwest and the Carolinas, said it expects to surpass its earnings target for the full year.
Its shares rose 21 cents to close at $19.03 Friday.
Duke earned $607 million, or 48 cents per share, in the three months ended Sept. 30, down from $763 million, or 60 cents per share, in the same period in 2006 when results included the natural gas unit.
Excluding special items and discontinued operations, earnings were 48 cents per share, up from 29 cents per share a year ago.
Analysts surveyed by Thomson Financial forecast a profit of 39 cents per share. The estimates usually exclude one-time items.
Revenue rose 16 percent to $3.82 billion in the quarter from $3.28 billion a year earlier. Analysts expected revenue of $3.43 billion.
The company's 2007 earnings will 'finish well above' its target $1.15 per share, Duke Energy Chairman and Chief Executive James E. Rogers said in a statement accompanying the report Analysts polled by Thomson Financial expect the company to earn $1.18 per share this year.
Duke Energy spun off its natural gas unit, now trading as Spectra Energy Corp. (NYSE:SE) , to its shareholders in January. Last year, Duke purchased the power company Cinergy Corp.
For the third quarter, Duke Energy's franchised electric and gas unit posted an increase in earnings, mainly driven by hotter than normal weather during the period, the completion of rate credits related to the Cinergy merger and additional long-term wholesale contracts. The company's commercial power segment also posted higher results brought on by favorable weather.
Duke Energy International posted an increase in earnings, reflecting favorable pricing in Latin America.
'We had a strong quarter,' Rogers said in an interview. 'Moving forward, we need to continue to keep tight controls on our costs.' Duke continues to work through several proposals with regulators concerning rate cases, building and clean-air permits and energy efficiency.
The company expects decisions in the coming months on two rate increase cases pending in North Carolina and Ohio. Duke Energy agreed earlier this month to cut rates in North Carolina, a reversal of its request last summer to raise rates. Ohio legislators are negotiating with Duke and other utilities to develop a rate framework for after the state's rate stabilization plan expires at the end of 2008.
Duke Energy also has proposed an advanced coal-fired plant in North Carolina, a nuclear plant in South Carolina and a 'clean-coal' plant in Indiana.
The company also has filed plans for its 'Save-a-Watt' program, which would lower rates for consumers who conserve energy and compensate the company for reductions in energy use.
'We are expecting a lot of regulation outcome in the fourth quarter,' Rogers said.
Duke has about 36,000 megawatts of electric generating capacity in the Midwest and the Carolinas and more than 4,000 megawatts of electric generation in Latin America.
For the first nine months of the year, Duke Energy reported earnings of $1.26 billion, or 99 cents per share, compared with $1.48 billion, or $1.27 per share, in 2006. Revenue rose to $9.95 billion from $7.8 billion a year earlier.
International Paper's Quarterly Profit Off 3% International Paper Co.'s third-quarter net earnings dipped 3% as flat volumes and higher costs for raw materials offset improved selling prices, the company reported Friday.
For the latest quarter, the Memphis, Tenn.-based paper and packaging company (IP) said preliminary net earnings were $217 million, or 51 cents a share, compared to $224 million, or 46 cents, earned a year ago. The number of shares in the recent quarter was about 12% below that of last year.
Revenue increased 2% to $5.54 billion.
International Paper said earnings from continuing operations were 52 cents a share, including 6 cents in one-time charges and a penny in one-time gains.
Excluding the special items, earnings were 57 cents a share, in line with the average profit estimate of analysts surveyed by Thomson Financial.
"The overall quality of the result looks good, in our view, and we were particularly encouraged by a standout operational quarter in the company's white paper business," J.P. Morgan analyst Claudia Shank said in a note.
Shares of International Paper were down 1.4% recently to $35.56. Over the last year, the stock's traded in a range of $41.57 to $31.05.
"Volumes were flat quarter-to-quarter, but we saw overall price improvement, which more than offset some increases in raw-material and distribution costs," Chief Executive John Faraci said in a release.
Last month the company warned that disappointing land sales would push third- quarter earnings below Wall Street targets, which averaged 63 cents a share at the time. .
International Paper has been in the midst of a strategic overhaul, selling its North American land holdings to invest in operations in Europe, Latin American and Brazil, where growth for paper and packaging have been strong versus its more traditional markets. .
About 30% of earnings before interest, taxes, depreciation and amortization are estimated to come from outside North America in 2007, up from 20% in 2002.
For the fourth quarter, International Paper expects slightly higher earnings from continuing operations as volumes under a seasonal slowdown in most segments. The company also expects a modest improvement in pricing, while costs for wood, energy and transportation will continue to increase and other costs will remain high. http://money.cnn.com/news/newsfeeds/articles/djf500/200711021509DOWJONESDJONLINE000808_FORTUNE5.htm
11/2/2007 10:32:13 AM Media and merchandise company Martha Stewart Living Omnimedia, Inc. (MSO) on Friday reported a narrower loss in its third-quarter, helped by strong growth in its publishing business. The company said it is poised to return to profitability in 2007. The New York-based company's net loss was $4.4 million, or $0.08 per share, in the quarter, compared to a loss of $25.21 million, or $0.49 per share, in the year-ago quarter.
On average, three analysts polled by First Call/Thomson Financial expected the company to report loss of $0.13 per share in the quarter.
The prior-year results included a litigation reserve of $18.2 million and a $2.5 million benefit from the resolution of a dispute with a former merchandising licensee. Excluding the litigation reserve and the licensing resolution, loss per share would have been $0.18.
Quarterly revenues rose 13.4% to $69.26 million from $61.05 million in the same period last year. The results were mainly helped by advertising revenue growth in publishing and revenue from the book deal with Clarkson Potter.
Two Street analysts had a consensus revenue estimate of $68.48 million for the quarter.
Segment-wise, the company's publishing revenues were $46.22 million in the third quarter, a 27.5% growth from $36.26 million in the prior-year quarter. Merchandising revenues declined 7.9% to $10.95 million from $11.89 million in the third quarter of 2006.
Quarterly revenues of Internet business increased 15.7% to $3.27 million from $2.83 million in the preceding year quarter. Broadcasting revenues, however, dropped 12.4% to $8.82 million from $10.07 million last year.
For the first nine months of 2007, the company reported net loss of $23.02 million, or $0.44 per share, compared to a loss of $33.21 million, or $0.65 per share, for the first nine months of 2006.
Revenues for the nine-month period stood at $209.41 million, a 9.5% increase from $191.30 million, recorded in the corresponding period a year ago.
For the fourth quarter, the company expects revenues of approximately $120.0 million and operating income in the range of $33.0-$35.0 million.
Two analysts, on average, expected the company to post revenues of $125.52 million in the fourth quarter. Looking ahead to fiscal 2007, Martha Stewart Living anticipates revenues of approximately $330.0 million and operating profit in the range of $7.5-$9.5 million.
President and chief executive officer Susan Lyne, said, “Financially, our double-digit revenue growth and favorable trend in adjusted EBITDA demonstrate the continued strength of our business, which is on course to return to profitability for the full year 2007.”
On average, three analysts polled by First Call/Thomson Financial expected the company to post revenues of $336.35 million in full-year 2007.
MSO is currently trading at $12.73 on the NYSE, down $0.40 or 3.05%, on a volume of 62,100 shares.
NYSE Euronext triples profit NYSE Euronext, the transatlantic exchange operator, on Friday said third-quarter earnings more than tripled profit after the summer's credit squeeze drove trading volumes to record levels.
A vigorous program of cost-cutting also helped lift the exchange's net income from $68m to $258m over the same period last year.
Excluding merger costs and other items, NYSE Euronext earned $202m. Revenue doubled to $1.2bn from $602m in the third-quarter of 2006, while fixed operating costs fell 8 per cent.
The NYSE Group completed its merger with Euronext in April.
"We delivered record financial results through strong growth across our business lines, driven largely by record trading volumes in the US and Europe and ongoing expense control,'' Nelson Chai, chief financial officer, said.
Derivatives trading accounted for 25 per cent of third-quarter net revenue rising to $243m from $9m, lifted by Liffe, Europe's second-largest derivatives market, the NYSE group acquired with Euronext.
The London-based Liffe derivatives exchange saw a record 272.2m contracts traded in the quarter, an increase of 54.4 per cent year on year.
European cash trading contributed 18 per cent of income, the exchange said. US equities trading, market data and listings accounted for most of the remainder.
The exchange's four European markets - Paris, Amsterdam, Brussels and Lisbon - recorded their busiest quarter. These markets averaged 1.3m trades per day, up 85.5 per cent year-on-year.
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