UPS delivers big quarter
UPS Inc., the world’s largest shipping carrier, reported Thursday a 21 percent increase in fourth-quarter profit on a strong rise in revenue, but the results were slightly below Wall Street expectations.
The Atlanta-based company said it earned $1.05 billion, or 95 cents a share, for the three months ending Dec. 31, compared to a profit of $866 million, or 76 cents a share, for the same period a year ago.
The company said it increased its effective tax rate in the fourth quarter, reducing its earnings by 2 cents a share. However, UPS did not consider it a one-time item, nor include the reduction in its adjusted income data.
Analysts surveyed by Thomson Financial recently boosted their earnings projection for UPS to 96 cents a share. UPS shares fell $1.21, or 1.6 percent, to close at $75.55 on the New York Stock Exchange.
Revenue rose 21.5 percent to $11.95 billion, compared to $9.84 billion a year ago.
“It was a year we demonstrated who we are and what we can accomplish,” Scott Davis, the company’s chief financial officer, said of 2005 in a conference call with investors.
•Dow Chemical Co. said Thursday its fourth-quarter earnings grew 7 percent despite higher raw material and energy costs and lower output because of hurricanes. Full-year income soared 61 percent.
The company’s fourth-quarter profit rose to $1.1 billion, or $1.12 per share, from $1 billion, or $1.06 per share, a year ago. Excluding certain unusual items, Dow said it would have earned $1.02 per share in the latest quarter, up from 85 cents a year ago.
Analysts surveyed by Thomson Financial expected profit of $1.04 per share on sales of $12.09 billion.
Revenue increased 9 percent to $11.9 billion from $10.9 billion. The company said prices rose 10 percent, with strong gains in all segments except its agricultural sciences unit. This made up for lower volume, a result of hurricanes Rita and Katrina, Dow said.
•Lockheed Martin Corp., the largest U.S. defense contractor, said Thursday its fourth-quarter earnings grew 53 percent as the company’s burgeoning information technology business and one-time gains helped make up for nearly flat sales in its aircraft division.
Lockheed has built up its government information technology line in part to compensate for the uncertainty over the Pentagon’s appetite for the company’s fighter jets and other military hardware that Lockheed is best known for.
The Bethesda-based company’s stock jumped on the news of higher earnings and Lockheed’s raised 2006 outlook that beat Wall Street estimates. Lockheed shares rose $1.98, or 3.1 percent, to close at $66.99 on the New York Stock Exchange.
Lockheed said profit in the latest quarter was $568 million, or $1.29 per diluted share, compared to $372 million, or 83 cents per share, in the year-ago period.
•The rising cost of pensions and building out a fiber-optic network kept earnings essentially flat at Verizon Communications Inc. in the fourth quarter, while customers migrated from traditional phone lines to cell phones and broadband connections.
The New York-based telephone company said it earned $1.7 billion, or 59 cents per share, in the last three months of 2005, down from $3 billion, or $1.08 a share, a year ago, when results were boosted by the sale of Canadian assets and a tax gain.
Excluding items, earnings in both periods were 64 cents a share, matching the average analyst estimate for the latest quarter as polled by Thomson Financial.
New customers at Verizon Wireless boosted revenue to $19.3 billion, up 5.8 percent from $18.3 billion in the fourth quarter of 2004.
The latest earnings were reduced by $59 million because Verizon stopped contributing to its pension plan for managers, partly compensating them with an 18-month enhancement to the plan. When announcing the move in December, the company said it would cut costs by $3 billion over 10 years.