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Earnings roundup: AT&T profits double

A statue of former San Francisco Giant Juan Marichal is shown outside of AT&T Park in San Francisco, Monday. Telecommunications heavyweight AT&T Inc. said its profit doubled to $2.8 billion in the first three months of the year, its first full quarter since completing its acquisition of BellSouth. (Associated Press / The Spokesman-Review)
From Wire Reports The Spokesman-Review
A statue of former San Francisco Giant Juan Marichal is shown outside of AT&T Park in San Francisco, Monday. Telecommunications heavyweight AT&T Inc. said its profit doubled to $2.8 billion in the first three months of the year, its first full quarter since completing its acquisition of BellSouth. (Associated Press / The Spokesman-Review)

Telecommunications heavyweight AT&T Inc. reported Tuesday it doubled its profit and sales in the first three months of the year, primarily because of its completed acquisition of BellSouth.

Profit reached $2.85 billion, helped by the BellSouth acquisition and growth in wireless revenue. The earnings, which included $2.3 billion in acquisition-related charges and a $409 million gain from the sale of some assets, amounted to 45 cents per share for the period ended March 31. That was up from $1.45 billion, or 37 cents per share, earned by AT&T in the first quarter of 2006, when it had not yet acquired BellSouth.

First-quarter revenue rose 84 percent to $28.97 billion, up from a pre-merger tally of $15.76 billion in the same period a year ago.

“It was an important three months for us in terms of transition,” said Chief Financial Officer Rick Lindner in a call with analysts. “I feel good about how we started. Our integration is on track.”

Had BellSouth and AT&T been combined in the first quarter of 2006, they would have reported roughly the same amount of revenue at $28.9 billion, and net income of $1.98 billion.

“Burlington Northern Santa Fe Corp. said Tuesday its first-quarter profit fell 15 percent as costs for environmental cleanup and higher fuel bills offset the impact of record freight revenue at the railroad operator.

But company executives told analysts that earnings per share in the second quarter will be little changed from a year ago. They blamed higher fuel costs and a slowdown in housing and the economy that could weaken demand for shipping freight.

Shares of Burlington Northern fell $2.03, or 2.2 percent, to $90.57 Tuesday on the New York Stock Exchange.

Burlington Northern said it earned $349 million, or 96 cents per share, in the three months ended March 31, down from $410 million, or $1.09 per share, a year earlier.

Excluding what it termed special costs for clean-up jobs and the write-off of technology systems, Burlington Northern said it would have earned $1.10 per share.

“Web retailer Amazon.com Inc. said Tuesday its first-quarter profit more than doubled, sending shares sharply higher in after-hours trading. The company also raised its revenue outlook for the year.

Quarterly earnings rose to $111 million, or 26 cents per share, from $51 million, or 12 cents per share, during the same period last year.

Analysts polled by Thomson Financial had forecast a profit of 15 cents per share.

A $12 million reduction in Amazon’s tax bite helped nudge results higher, as did a weak dollar against foreign currencies, which added about $5 million to the bottom line, the company’s chief financial officer told reporters in a conference call.

Revenue rose 32 percent to $3.02 billion, surpassing Wall Street’s expectation of $2.92 billion in sales.

“Sun Microsystems Inc. swung to a profit in the third quarter, matching Wall Street’s tepid expectations, but shares plunged on fears that lower-than-expected revenue signaled a slowdown in its core server business where the company had been gaining market share.

Sun said Tuesday its net income was $67 million, or 2 cents per share, for the first three months of the year. That compares with a loss of $217 million, or 6 cents per share, in the same period a year ago.

Revenues for the quarter were $3.28 billion, a slight increase from the $3.18 billion recorded in the year-ago period.

Excluding one-time charges for restructuring and other expenses, Sun earned a penny per share, matching the average profit expectation from analysts surveyed by Thomson Financial.

“United States Steel Corp.’s first-quarter profit rose 6.6 percent as growth in the steel maker’s European operations helped boost results, the company said Tuesday.

The Pittsburgh-based company said earnings grew to $273 million, or $2.30 per share, from $256 million, or $2.04 per share, during the same period last year. Revenue increased to $3.75 billion from $3.72 billion in the first quarter of 2006.

The latest results included a $3 million pretax charge related to the company’s early redemption of debt securities, reducing profits by $2 million, or 2 cents per share.