Cable Expansion Cuts Into At&T’S Earnings

AT&T’s earnings per share declined as expected in the fourth quarter despite rising revenues, as the company continued to invest heavily in its strategy to use cable TV lines for telephone and Web service.

Excluding one-time factors, the company earned $1.84 billion, or 57 cents per share, in the final three months of 1999, topping most Wall Street forecasts.

Those figures compare with an operating profit of $1.80 billion, or 68 cents per share, in the fourth quarter of 1998 - including the performance of the TCI cable operation and IBM Global Network, both of which AT&T was still in the process of acquiring.

In other reports Tuesday:

Procter & Gamble Co., a day after deciding against a bid for drug makers Warner-Lambert and American Home Products, reported second-quarter earnings that were little changed from a year earlier but that beat Wall Street expectations.

P&G said its earnings totaled $1.13 billion, or 78 cents per share, in the quarter ended Dec. 31, compared with $1.14 billion, or 78 cents per share, in the same period last year. When costs of P&G’s ongoing corporate restructuring are excluded, earnings were $1.3 billion, or 88 cents per share, matching the prediction of securities analysts.

Sales rose 7 percent to $10.59 billion from $9.93 billion.

Xerox Corp. reported its profits fell 52 percent in the fourth quarter as it struggled with increased competition and sales that were diminished by Y2K anxiety. The company said it was pursuing cost-cutting steps but did not say what they might be.

Higher oil prices helped push Exxon Mobil Corp.’s fourth-quarter earnings up nearly 34 percent and ahead of Wall Street expectations.

The oil company said Tuesday its net operating income was $2.71 billion, or 77 cents a share, 2 cents better than the 75 cents expected by analysts. Earnings a year earlier were $2.03 billion, or 58 cents a share.

American Home Products Corp., in the midst of a takeover battle for Warner-Lambert Co. said its fourth-quarter earnings rose 1 percent, well below the pharmaceutical industry’s double-digit average.

The performance met analysts’ expectations.

Strong building activity in 1999 helped boost earnings for Crown Pacific Partners and Plum Creek Timber Co.

Portland-based Crown Pacific reported record earnings of $34.4 million, or $1.13 per unit for the past year. In 1998, earnings were $28.2 million.

Seattle-based Plum Creek posted earnings of $125.6 million, which included $32.6 million in one-time gains. The earnings amounted to $1.95 per share, compared with $75.4 million in 1998.

Higher prices for logs and forest products helped boost earnings for both companies.

Johnson & Johnson said its fourth-quarter profit jumped 12 percent excluding unusual charges, exceeding Wall Street forecasts by a cent.

Online auction house eBay Inc. topped Wall Street’s estimates, posting higher-than-expected fourth-quarter earnings reaped from record numbers of registered users and auctions.

For the quarter ended Dec. 31, eBay reported net income of $4.9 million, or 4 cents per share, compared with $2.6 million, or 3 cents per share, in the year-ago period.

Fourth-quarter profits grew 8.2 percent at SBC Communications, the nation’s largest local phone company, fueled by more strong demand for data and wireless services and by international investments.

The booming stock market allowed Merrill Lynch & Co., the largest brokerage firm in the United States, to double its fourth-quarter earnings from a year ago.

Raytheon Co. said its fourth-quarter earnings plunged 79 percent, a drop larger than Wall Street analysts had projected for the defense contractor. The company blamed a decline in revenue on lower missile shipments as well as aircraft production delays and accounting changes mandated by the Securities and Exchange Commission.

Compaq Computer Corp. reported a 56 percent tumble in fourthquarter profits on a 4 percent drop in revenue, dragged down by lower sales of business computers as the company struggled to maintain its global leadership in PCs.

Compaq managed to beat Wall Street expectations, but the results were bolstered by a gain of $50 million in its own investment portfolio, separate from growth from its computer business.

The McGraw-Hill Cos. reported a 30 percent jump in fourth-quarter profits due to strong showings in textbook publishing, the Standard & Poor’s financial information service and Business Week magazine.

Blaming a decline in steel prices due to overseas competition, USX-U.S. Steel Group reported a 55 percent decline in earnings in the fourth quarter of 1999.

Chevron Corp.’s fourth-quarter earnings surged higher on a jump in oil prices and beat analysts’ estimates.

The second-largest U.S. oil firm said Tuesday it earned $809 million, or $1.23 a share, for the October-December period compared with a loss of $206 million, or 31 cents a share, a year earlier.

RealNetworks, which broadcasts or “streams” video and audio over the Internet, reported $6.1 million in fourth-quarter profits, up from a loss of $2.2 million a year earlier.

RealNetworks also announced it was buying NetZip Inc., a privately-held software company based in Atlanta, for about $268.4 million in stock.