Earnings roundup: McDonald’s ekes out higher profit

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Posted: Thursday, January 24, 2013 12:00 am

NEW YORK (AP) — McDonald’s Corp. pushed out a higher profit in the fourth quarter by luring diners with its value menu, but the world’s biggest hamburger chain also warned that a key sales figure is expected to drop this month.

The downbeat forecast reflects the intensifying competition and changing dining habits that McDonald’s faces. After years of outperforming its rivals, McDonald’s recently hit a snag and took a series of steps to bolster slumping sales, such as touting its Dollar Menu and pushing franchisees to stay open on Christmas.

In November, it fired the chief of its U.S. business after reporting its first monthly sales drop in nearly a decade.

For the period ended Dec. 31, McDonald’s said that it earned $1.4 billion, or $1.38 per share, compared with $1.38 billion, or $1.33 per share, a year ago.

Revenue rose to $6.95 billion, up from $6.82 billion.

Among other earnings reports Wednesday:

— Apple’s profit surge halted in the latest quarter, as a flood of new products like the iPhone 5 meant high start-up costs for new production lines. Apple posted net income for the October to December quarter that was flat with the year before. It was the first time in years that Apple didn’t post a double-digit earnings increase. Net income in the fiscal first quarter was $13.1 billion, or $13.81 per share.

Revenue was $54.5 billion, up 18 percent from a year ago.

Apple shipped 47.8 million iPhones in the quarter, 1 million fewer than analysts were expecting, and 22.9 million iPads, also about 1 million short.

Looking ahead, Apple said it expects sales of between $41 billion and $43 billion in the current quarter, which ends in March.

— WellPoint Inc.’s fourth-quarter earnings jumped 38 percent compared to the final quarter of 2011, when the nation’s second largest health insurer incurred a big hit from its Medicare Advantage business.

The Indianapolis company earned $464.2 million, or $1.51 per share, in the three months that ended Dec. 31. That’s up from $335.3 million, or 96 cents per share, in the last quarter of 2011. Excluding the investment and tax settlement gains and other adjustments, earnings totaled $1.03 per share.

— Swiss drug maker Novartis AG reported a jump in fourth-quarter net profit to $2.08 billion, citing the lack of a $900-million one-time charge it took in the same period the previous year.

Net profit during the final quarter of last year rose 72 percent from the $1.21 billion net profit posted in the final three months of 2011, when the Basel-based company took a hit from ending its clinical study into wider uses of the hypertension drug Tekturna.

— Unilever PLC, the maker of consumer products such as Dove soaps and Magnum ice cream, said sales grew 7.8 percent to (euro) 12.6 billion ($16.8 billion) for the fourth quarter on growth in developing markets — more than half the company’s sales in 2012 came from outside mature economies.

Along with a fourth quarter trading update, the company reported full year net profit was up 4.5 percent to (euro) 4.25 billion, on sales that were up 10.5 percent to (euro) 51.3 billion.

— US Airways said net income doubled in the fourth quarter as its planes were fuller and it made more money off each passenger.

The Tempe, Ariz., airline earned $37 million, or 22 cents per share, compared with $18 million, or 11 cents per share a year ago. Excluding special items, net income was 26 cents per share, 7 cents higher than analyst forecasts, according to FactSet.

US Airways, which is in merger talks with AMR Corp., parent of American Airlines, said revenue set a fourth-quarter record of $3.28 billion. That was up about 4 percent.

— General Dynamics, an aerospace and defense company, reported a big fourth-quarter loss due to charges related to slowing defense spending.

The company said it expects to earn $6.60 to $6.70 per share from continuing operations this year.

The Falls Church, Va., company said it lost $2.13 billion, or $6.07 per share during the October-December quarter, compared with net income of $603 million, or $1.68 per share, a year earlier.

Revenue fell almost 12 percent to $8.08 billion from $9.15 billion.

— Ikea said it plans to open 25 new outlets this year, recruiting 75,000 workers as its global market share in 2012 increased with annual net profit growing 8 percent to (euro) 3.2 billion ($4.3 billion) in 2012.

The world’s largest furniture retailer reported revenue of (euro) 27.5 billion for the 2012 fiscal year, up from (euro) 26 billion a year earlier. The company does not release quarterly figures.

— A surge in new customers left Netflix’s Internet video service with 27.1 million U.S. subscribers to its operation that streams movies and TV shows to Internet-connected devices. Netflix earned nearly $8 million, or 13 cents per share. That was a 78 percent drop from the same time in the previous year.

Revenue climbed 8 percent to $945 million.

© 2014 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.


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