Business briefs for April 17, 2002

Wednesday, April 17, 2002 | 11:24 a.m.

First quarter earnings improve

The parent company of Business Bank of Nevada on Tuesday reported first-quarter earnings of $233,817, or 14 cents per common share, an improvement from the $108,709 or 7 cents earned during last year's first quarter.

John Guedry, president and chief executive officer, attributed the improvement to growth in the bank's loan portfolio and the addition of new customers who increased overall deposits to $185.3 million.

Business Banks's loans and other assets on March 31 totaled $202.2 million, up from $188.1 million last year.

Automaker reports loss

DEARBORN, Mich. -- Ford Motor Co. today reported a loss of $800 million in the first quarter, as sales fell and the company absorbed a big charge for a change in accounting standards. The loss before the charge was smaller than Wall Street expected, however.

Chairman and Chief Executive Bill Ford Jr. said the results show the nation's second biggest automaker is "heading in the right direction" and said Ford expects to meet or surpass its earnings target for the year.

Ford lost 45 cents a share in the January-March period in contrast to a profit of $1.06 billion, or 56 cents a share, a year ago. Revenue fell 6 percent to $39.86 billion from $42.45 billion a year earlier.

Excluding a $708 million non-cash, after-tax charge for transition to a new accounting standard, Ford's loss was $108 million, or 6 cents a share.

The consensus forecast of analysts polled by Thomson Financial/First Call was that Ford would lose 15 cents a share before charges.

Profit soars 48 percent

SEATTLE -- Washington Mutual Inc., the largest U.S. savings and loan and a big lender in Las Vegas, said Tuesday its first-quarter profit rose 48 percent as the company made more mortgage loans and increased the number of bank accounts opened.

Net income rose to $950 million, or 98 cents a share, from $641 million, or 76 cents, a year earlier. The company matched the average estimate of analysts surveyed by Thomson Financial/First Call. Estimates ranged from 94 cents a share to $1.06.

Net interest income rose 76 percent to $2.4 billion from $1.36 billion, Washington Mutual said. The Seattle-based thrift gained new checking accounts in the period as customers opted for the company's free-checking promotions. Banking fees rose 29 percent to $361 million from $279 million.

Chip sales stronger than expected

SAN JOSE, Calif. -- Intel Corp. posted first-quarter earnings and revenues in line with analysts' expectations Tuesday, indicating the chip-making giant has moved beyond the tech downturn's low point.

Though sales of microprocessors were stronger than expected and business overall is stable, the company has yet to see a return of strong sales growth, said Andy Bryant, Intel's chief financial officer.

"What we're seeing right now is seasonality," said Andy Bryant, Intel's chief financial officer. "We are not seeing any kind of recovery yet."

For the three months ended March 30, Intel earned $936 million, or 14 cents a share, compared with profits of $485 million, or 7 cents per share, in the same period last year.

The sharp increase was largely due to the adoption of new accounting rules regarding acquisitions.

Excluding one-time items, the chip maker earned $1 billion, or 15 cents a share, compared with $1.1 billion, or 16 cents a share, in the first quarter of last year.

First-quarter sales were $6.8 billion -- a 2 percent increase over last year's first-quarter revenues of $6.7 billion.

Bank operator reports rebound

MINNEAPOLIS -- U.S. Bancorp, the eighth-biggest U.S. bank and a player in the Nevada market, on Tuesday said its first-quarter profit increased 84 percent as costs fell and the company wrote off fewer bad loans.

Net income rose to $756 million, or 39 cents a share, from $410 million, or 21 cents, a year earlier. In the year-ago quarter, the company had $387.2 million of expenses related to the $22.2 billion merger of Firstar Corp. and U.S. Bancorp.

The rise in profit was U.S. Bancorp's first in three quarters. Last year the bank wrote off loans to transportation companies and airlines in the wake of the Sept. 11 terrorist attacks.

"This is a company that's recovering," said Lawrence Creatura, who helps manage $1.9 billion at Clover Capital Management Inc., including U.S. Bancorp shares.

U.S. Bancorp, led by Chief Executive Jerry Grundhofer, was formed a year ago when Grundhofer's Firstar Corp. bought U.S. Bancorp. His older brother, John F. Grundhofer, ran the old U.S. Bancorp.

The bank's net interest income, which it makes from lending money, rose 6.8 percent to $1.67 billion. Falling interest rates made it more profitable for banks to lend money because the cost of their funds fell. The bank wrote off $355 million of bad loans, down from $387.1 million a year earlier.

Slowdown hurts plane maker

CHICAGO -- Boeing Co. reported a $1.25 billion first-quarter loss today due to a hefty accounting change and fell well short of Wall Street's expectations amid the slowdown in aviation since Sept. 11.

Despite what it called a strong operating performance in its core aerospace and finance businesses, Boeing was hurt by weakness in its commercial satellite operation and continuing fallout from the terrorist attacks.

Boeing shares fell $1.95, or 4 percent, to $46.75 in early trading on the New York Stock Exchange.

The biggest setback was a non-cash charge of $1.83 billion, primarily for goodwill related to the October 2000 acquisition of the satellite-making holdings of Hughes Electronics Corp. Boeing had warned it would take the charge to comply with new accounting rules governing the amortization of goodwill, or the amount above fair value that a company is allowed to carry on its books after paying an acquisition premium.

The net loss amounted to $1.54 a share for the January-March period, compared with earnings of $1.24 billion, or $1.45 a share, a year earlier.

Excluding special items, earnings of $602 million, or 75 cents a share, came in below the 85 cents-per-share consensus estimate of analysts interviewed by Thomson Financial/First Call.

Among other reasons for the shortfall, profits at its space and communications division fell 50 percent to $42 million, and Boeing said the impact of stock compensation reduced earnings by 13 cents a share.

Despite the rocky results, revenues rose 4 percent to $13.8 billion from $13.3 billion as Boeing benefited from its continuing push to diversify beyond airplanes.

Bank posts record results

MONTGOMERY, Ala. -- Colonial BancGroup Inc., owner of Colonial Bank in Nevada, today reported a record first quarter profit of $34.2 million or 29 cents per share, up from $29.2 million or 25 cents in the year-ago quarter.

Loans and other assets increased from $12.4 billion to $13.2 billion as the company completed the purchase of Mercantile Bancorp Inc. in Texas.

"It would appear from recent economic indicators that the worst of the economic slowdown is behind us and that economic growth is returning to our market areas, although not at pre-recession rates," said Chief Executive Robert Lowder.

Colonial has 258 offices in Alabama, Florida, Georgia, Nevada, Tennessee and Texas.

Company posts $575 million loss

FORT WORTH, Texas -- American Airlines' parent company said today it lost $575 million in the first quarter, as the carrier struggled to recover from last year's recession and the Sept. 11 terrorist attacks.

American, the world's largest carrier, said it also expected to lose money in the second quarter.

Parent AMR Corp. said the first-quarter loss was $3.71 per share. A year earlier, the company lost $43 million, or 28 cents per share.

Chairman and Chief Executive Donald J. Carty said the airline was seeing signs of recovery.

"But the facts are that business travel, which historically constitutes a major portion of our business, is not rebounding the way leisure travel is, and average fares are down because of heavy discounting," Carty said.

The downturn in revenue combined with higher costs for labor, security and insurance, Carty said.