Ameritrade profit jumps 65 percent
A surge in stock trading last fall helped online brokerage TD Ameritrade Holding Corp. generate a 65 percent increase in its quarterly net income.
The Omaha-based company said Thursday that asset-based revenue also continued to grow and accounted for more than half of its revenue in the October-December period.
But some analysts questioned whether Ameritrade could replicate its results, and the company’s stock suffered as concerns about the ongoing credit crisis hurt stock prices.
Ameritrade’s shares fell $1.65, or 8.7 percent, to $17.34 Thursday.
Ameritrade reported $240.8 million in net income, or 40 cents per share, in the quarter that ended Dec. 31. That was up from $145.6 million, or 24 cents per share, in the same period a year ago.
Revenue increased 20 percent, to $641.6 million, from last year’s $535.2 million. On Thursday, the company said it expects to earn between $1.23 and $1.41 per share this year.
American Airlines, the nation’s largest carrier, doubled its fuel surcharge Thursday to $40 per round trip just days after a slightly larger increase led by United Airlines failed.
Spokesman Tim Smith said American’s fuel costs rose nearly 30 percent in the fourth quarter of last year, and 33 cents of every dollar American takes in goes to pay for fuel.
“If fourth-quarter fuel prices had stayed the same as the year before, it is conceivable that we would have been talking about a quarterly profit in the neighborhood of $180 million instead of the loss we actually reported,” Smith said. “We expect fuel prices to remain high and volatile.”
American parent AMR Corp. reported Wednesday that it lost $69 million in the fourth quarter, its first loss since early 2006.
General Motors Corp. plans to reduce its annual U.S. labor costs by another $5 billion by 2011, the company said Thursday.
Chairman and chief executive Rick Wagoner said a good chunk of the reduction will come from the new contract agreement reached last year with the United Auto Workers.
The contract shifts the obligation for about $46.7 billion in retired UAW workers health care from the company to the union, with the company pouring billions into a trust fund run by the union.
The trust, called a voluntary employees beneficiary association, takes over the health care obligation in 2010.
GM also anticipates that its spending on U.S. hourly and salaried pension and health care will drop from an average of $7 billion per year over the last 15 years to around $1 billion per year starting in 2010, the company said.