Struggling Jet Airways, one of India’s biggest carriers, reported yesterday a quarterly profit for the first time in two years, boosted by a one-off gain from the sale of a frequent-flyer scheme.

The Indian carrier, in which fast-growing Gulf airline Etihad Airways has bought a 24% stake, remained in the red when the sale proceeds were stripped out, but the airline still improved its operating performance markedly.

Jet announced a Rs698mn ($11.3mn) net profit for the second-financial quarter to September in contrast with a Rs8.9bn net loss in the same year-ago period.

“I am extremely pleased by the progress that is evident across several areas,” Jet Airways chief executive Cramer Ball, known as a turnaround specialist, said.

The publicly traded airline, which last reported a quarterly profit in 2012, has been seeking to pilot its way back to profitability in India’s congested skies.

While India’s passenger aviation market is one of the fastest-growing globally, cut-throat fare wars and too many carriers mean most of the country’s airlines are losing money, analysts say. Stripping out the Rs3.05bn earnings from the sale of its frequent flyer scheme, Jet lost Rs2.35bn, said the statement released after financial markets closed. But this was still a vast improvement from the airline’s year-earlier loss.

“This is in keeping with our three-year turnaround plan,” Jet’s chief executive said.

Jet in July forecast a return to annual profit in the next three years by 2017 through cost-cuts, route-sharing with new partner Etihad and restructuring of hefty debt.

It also will phase out budget-flight operations and become a full-service airline to trim losses.

The Indian government cleared last May the Abu Dhabi airline’s purchase of the 24% stake in Jet for Rs21bn ($330mn).

 

Telecom Italia

Telecom Italia must explore the possibility of buying or merging with Brazilian telecoms operator Oi, CEO Marco Patuano said yesterday, as the company tries to strengthen the position of its local subsidiary.

Some investors are betting Telecom Italia could eventually exit Brazil but a small Telecom Italia shareholder group has voiced its opposition to a possible sale, favouring instead a merger with Oi.

Patuano also faces changes in Telecom Italia’s shareholder base, with France’s Vivendi due to take an 8% stake to become the largest investor. Vivendi has not given a view on the Brazil strategy.

Telecom Italia yesterday unveiled a 7.7% fall in nine-month core earnings blaming weakness in Italy and a slowdown in Brazil but said it saw concrete signs of a domestic recovery.

Telecom Italia pointed to a slowdown in the pace of revenue decline at home thanks to the end of a price war and encouraging trends in broadband subscription.

Europe’s ninth-biggest phone company by market value said core earnings, or EBITDA, fell to €6.59bn in the first nine months, broadly in line with analyst expectations.

Revenues fell 9.1% to €15.97bn and net debt stood at €26.6bn at the end of September.

The decline in Italian revenues slowed to 7.2% in the nine months from over 8% in the first and second quarters thanks to growth in fixed broadband and to stabilisation of user revenues from its traditional mobile phone services.

 

Puma

German sportswear firm Puma reported its first increase in footwear sales in almost two years and strong sales of its Arsenal jerseys as it increased its sales target for 2014, while paring its margin forecast.

Puma, which has slipped further behind sportswear giants Nike and Adidas in recent years, said third-quarter net profit fell 45% to €29mn ($36mn) due to currency effects and higher marketing spending, slightly shy of average analyst forecasts for €30mn.

Puma is splashing out to restore its reputation for sports performance after a shift into fashion hurt its sneaker sales. It ousted Nike as kit supplier to Arsenal this season and launched its biggest marketing drive yet in August with athletes like sprinter Usain Bolt and soccer star Mario Balotelli.

Quarterly sales rose 3.7% to €843mn, an increase of 6.4% after stripping out currency effects. It said footwear sales, which account for 44% of the total, grew a currency-adjusted 2% - the first rise in seven quarters - helped by the popularity of its evoSPEED soccer boot, worn by several top players at the World Cup in Brazil.

 

Vestas

Vestas Wind Systems, the world’s largest wind turbine maker, raised its 2014 earnings forecasts yesterday in a sign the appointment of a new chief last year to turn the Danish firm around is paying off.  Shares in Vestas jumped as much as 17% after the company raised forecasts for sales, profit margins and cash flow this year on the back of a far stronger than expected performance in the three months to the end of September.

Vestas posted operating profit before special items of €163mn, up from €67mn in third quarter last year and 44% above an average forecast of 113mn euros in Reuters’ poll. Revenues rose to €1.8bn from €1.4bn, again above a €1.66bn forecast from analysts.

Fredriksson stressed that the 2014 results would depend on weather conditions for the rest of the year, as the company’s employees will be busy installing new turbines during the period, which is typically its strongest.

The company now expects its 2014 operating margin before special items to be 7 to 8%, up from an earlier forecast of at least 6%.

Chief executive Anders Runevad was brought in a year ago after the firm issued a string of profit warnings, which sent its historically volatile shares on a roller coaster ride.

 

Swiss Re

A stronger than expected profit rise at Swiss Re boosted hopes yesterday that the reinsurance group will join the slew of insurers sharply raising their dividend payouts, sending its shares to a near eight-month high.

Major European insurers are offering shareholders a bigger share of their earnings in dividends this year, as a low level of payouts for damage claims has allowed them to build up large cash piles.

Swiss Re’s rival Munich Re for instance has been returning surplus capital to shareholders by buying back its own shares and raising its dividend.

Swiss Re Chief Financial Officer David Cole said it was too early to comment on a special dividend on its 2014 results and the issue would be addressed in February, when the reinsurer reports full-year earnings.

“Our shareholders should expect us to approach this with the same discipline and the same philosophy that we have demonstrated over the last several years,” Cole said in an interview with Reuters yesterday, after Swiss Re posted a 14% rise in net profit in the third quarter to $1.2bn.

Swiss Re and others such as Hannover Re and Munich Re help insurance companies cover the cost of major damage claims, such as for hurricanes or earthquakes, in exchange for part of the premiums their customers pay.

 

Croda

Speciality chemicals maker Croda International posted a 4% rise in revenue at constant currency, marking its strongest performance in several quarters, as it saw improved sales trends in both its core markets.

Shares in the company, whose customers include Unilever, L’Oreal SA and Procter & Gamble Co, rose as much as 6.6% in morning trade yesterday. The stock featured among the top percentage gainers on London’s FTSE-250 Midcap Index.

Croda’s Chief Executive Steve Foots told analysts on a conference call that the company had not seen any approaches yet. He was responding to speculations that Croda was being eyed by the likes of Germany’s Evonik Industries and US-listed Dupont.

“We would not be surprised to see Croda ultimately fall victim to a larger global group but the timing of a takeover remains virtually impossible to predict,” said James Tetley, an analyst at brokerage N+1 Singer.

Despite the strong underlying growth, Croda said reported revenue fell 3.3% to £259mn ($410mn) in the three months ended September 30.

Third-quarter adjusted operating profit fell 6.4% to £58.1mn, hurt by adverse currency movements and currency transaction costs.

“This is Croda’s strongest performance in seven quarters, and bucks the recent trends highlight by peers like Givaudan and customers like L’Oreal,” Morgan Stanley analyst Paul Walsh said, keeping his “overweight” rating on the stock.

 

Disney

Walt Disney Co posted quarterly profit that fell in line with Wall Street expectations as the media and theme park giant rode the blockbuster performance of its movie box office hits Maleficent and Guardians of the Galaxy.

With the TV landscape rocked by a wave of new online viewing options, Chief Executive Bob Iger bucked the trend and insisted Disney would not rush to offer standalone subscriptions to popular content such as its sports behemoth ESPN outside the traditional bundle of channels sold by cable and satellite operators.

“We don’t feel a compelling need to take a product to market right now that is a direct challenge to that multichannel bundle,” Iger told analysts during the company’s quarterly conference call on Thursday. He said he expected the current pay TV model “to remain dominant for some time.”

Operating income at ESPN declined due to higher contract rates for high-end National Football League and Major League Baseball games, which helped drag down the company’s cable networks unit by 1% to $1.3bn.

The drop at cable networks, the company’s largest unit, likely drove Disney shares lower, said Gabelli & Company analyst Brett Harriss, who rates Disney a “hold.”

Operating income at its parks and resorts division rose 20% to $687mn due to increased attendance and higher ticket prices for theme park admissions. Revenue rose to $12.39bn, marginally above the average analyst estimate of $12.37bn.

 

BofA

Bank of America said its third-quarter net loss was more than three times bigger than reported last month, due to higher legal costs from probes into foreign exchange manipulation.

The second-largest US bank by assets announced after the markets closed that it was adjusting its third-quarter results to include an additional $400mn charge related to US investigations into its forex business.

Bank of America posted a net loss of $70mn, or one cent per share for the July-September quarter on October 15. Now, it said in a statement, the net loss is $232mn, or four cents per share.

The bank said that after it posted its results it had been in “separate advanced discussions with certain US banking regulatory agencies to resolve matters related to its foreign exchange business.”

 

Deutsche Telekom

German telecoms giant Deutsche Telekom said investments weighed on profits in the third quarter, but it confirmed its profit targets for the full year.

Deutsche Telekom said in a statement that its net profit fell by 13.9% to €506mn ($633mn) in the period from July to September.

Underlying or operating profit declined by 1.8% to €4.575bn while revenues grew by 0.8% to €15.648bn.

“All strategy-related trends are clearly on an upward trajectory. An excellent performance in the German mobile market, record customer additions in the US, strong financial development in Europe and improvements in Systems Solutions—these are Deutsche Telekom’s results for the third quarter,” boasted chief executive Tim Hoettges.

“For the first time in the history of Deutsche Telekom, more than 60% of revenue was generated abroad.”

“The challenges vary regionally, but we are clearly making progress everywhere,” Hoettges said.

 

Generali

Italian insurer Generali reported a better than expected 12.8% rise in operating profits for the first nine months of the year, thanks to a solid performance on all fronts, and said it was on track for a rise for the year.

Europe’s third-largest insurer by market value said its nine-month operating profit rose to €3.677bn ($4.6bn), above the consensus forecast given by analysts in a company survey of €3.618bn.

“As the group works hard to fulfil the strategic plan, we expect the operating result at year-end to improve with respect to the previous year,” Chief Financial Officer Alberto Minali said.

Italy’s biggest insurer also said its closely-watched Solvency I capital adequacy ratio stood at 160% at the end of September, up from 141% at the end of 2013.

The second quarter marked the end of an intense phase of disposals for Generali which helped it boost its capital base, allowing it to fully focus on its operating performance.

Besides delivering on its disposal programme, Generali has reduced debt and is in the process of executing a 2bn-euro efficiency programme. Just two weeks ahead of a much awaited investor day on November 19, the insurer said its premium income in the first nine months stood at €51.3bn, lifted by a 9.6% rise in life business with a 39% growth in linked products and strong performances in Italy and France.

 

Richemont

Swiss luxury giant Richemont yesterday posted a sharp drop in first half net profit amid weaker demand in China, but saw trading bolstered on a market bracing for worse.

The world’s second largest maker of luxury products after LVMH saw its net profit plunge 23% during the first half of its 2014/2015 fiscal year to €907mn ($1.12bn).

Analysts polled by the AWP financial news agency had expected to see a net profit of €1.08bn for the six-month-period.

Despite missing the mark, the company, which counts Cartier and Piaget among its luxury brands, saw its share price surge more than 4%, with analysts saying investors had been bracing for far worse. Richemont also beat expectations on sales, which inched up two% to €5.43bn, surpassing the €5.3bn anticipated by analysts.  But sales shrank two% in Asia, dragged down by dwindling sales in the company’s two main markets China and Hong Kong.

Richemont said it had lost €239mn on programmes aimed at reducing the risk of currency fluctuations.

That compares to the €127mn profit the company made on those programmes during the same period a year earlier.

“The external environment remains difficult ahead of the holiday trading period,” acknowledged company chairman Johann Rupert. He stressed though that the results “were fairly resilient overall, given the volatility of the environment that affected our clients and retailer partners.”

“We remain confident that demand for high quality products will continue to grow in the global market,” he said.

Investors appeared to agree. Following the news, the company’s share price jumped 4.04% to 83.75 Swiss francs a piece in early afternoon trading on a slightly negative Swiss market.

Observers explained that the market had feared Richemont would fare far worse, and had for instance been bracing for Hong Kong’s “umbrella revolution” would take a heavier toll on luxury sales there.

 

TripAdvisor

Travel review website TripAdvisor reported a quarterly profit that missed analysts estimates by a wide margin as marketing costs jumped by nearly two-thirds and referral revenue lagged the company’s expectations. TripAdvisor shares fell 15% to $71 in post-market trading as the higher costs ate into a 39% rise in revenue.

Chief Executive Officer Steve Kaufer added that lower-than- expected click-based revenue growth partially offset gains made from the purchase of travel booking website Viator in July.

The company relies heavily on click-based advertising, which made up 70% of its total revenue in the latest quarter.

TripAdvisor makes money when a user clicks through to a third-party booking site.

The company launched a major advertising campaign in the third quarter, driving selling and marketing costs up 64% to $159mn.

The company’s net income fell to $54mn, or 37 cents per share, for the third quarter ended September 30, from $56mn, or 38 cents per share, a year earlier.

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On an adjusted basis, the company reported a profit of 48 cents per share.

 

Prudential

Prudential Financial, the second-largest US life insurer, reported a quarterly profit that fell short of market estimates by a wide margin, mainly due to losses tied to its derivatives programme.

Overall charges and losses during the quarter totalled $1.13bn, with derivatives-linked losses forming the majority.

Nearly half of the losses stemmed from a stronger dollar, particularly against the Japanese yen. Japan accounts for about a third of the company’s international premiums.

The dollar rose 5.2% against the yen in the third quarter from a year earlier.

Prudential, like other insurers, is heavily exposed to persistently low interest rates and wild swings in foreign exchange rates. But it has long had a substantial derivatives program designed to smooth out that risk.

The company reported operating earnings on an adjusted basis of $2.20 per share, well below the average analyst estimate of $2.41 per share.

Operating income from the individual annuities business halved to $367mn. Profit in its US life insurance business fell 88% to $24mn in the quarter ended September 30, hurt by one-time charges.

Net profit in the financial services businesses attributable to the company was $465mn, or 99 cents per share, for the quarter ended September 30, from $966mn, or $2.04 per share, a year earlier.

The company’s financial services business includes individual annuities, retirement services and investment management businesses

 

NN Group

NN Group NV, the insurance arm of Dutch banking giant ING Group, posted a 16.6% rise in quarterly operating profit, driven by heavy cost cutting and lower debt funding costs.

NN Group, whose retirement, insurance and investment services span 18 countries across four continents, said it expected to meet its €200mn ($250.82mn) cost cutting target by 2016.

Operating profit from ongoing business rose to €274mn in the third quarter, compared with €235mn a year earlier.

NN Group’s assets under management increased to €180bn at the end of the third quarter, up 2.3% on year.

The group reported strong sales across all regions. It has a substantial European presence with a strong position in the Dutch market, besides operations in Japan and a global investment management business.

ING, which owns 68.1% of NN Group, spun the unit off in July in the largest listing continental Europe had seen for three years. The move was part of a major restructuring in which ING also shed its investment bank and cut thousands of jobs to comply with the terms of its state rescue.

 

Allianz

Shares in Allianz jumped more than 3% yesterday after the German insurer promised bigger dividend payouts having posted a forecast-beating jump in third-quarter net profit.

The surprise dividend move helped mollify shareholders worried about turmoil at asset management arm Pimco, where the defection of investment guru Bill Gross has unsettled clients, triggered record investor outflows and weighed on the unit’s quarterly contribution to the group.

“Operating profit in asset management was still on a high level, but the high net outflows (of client funds) remains a concern,” said DZ Bank analyst Thorsten Wenzel in a note to clients.

In a statement issued after Thursday’s Frankfurt stock market close, Europe’s biggest insurer said it would pay out 50% of net profit in dividends versus 40% up to now.

Allianz had said it would review its dividend policy by the end of the year after facing calls from investors to bring its dividend more into line with peers like Zurich Insurance , which pays out around 70% of net results.

Allianz’s quarterly operating and net profit rose 5% and 11% respectively, beating the average forecasts in a Reuters poll of banks and brokerages for 2.4% and 6.7% increases.

Operating profit in property-casualty insurance and asset management were both ahead of average analyst expectations, but asset management still posted an 8% decline from the year earlier quarter.