Exxon Mobil posts 3% rise in Q3 profit on refining

Exxon Mobil Corp, the world’s largest publicly traded oil company, yesterday reported a better-than-expected 3% increase in quarterly profit on higher results in its refining and chemicals businesses.

Share rose nearly 1.4% to $95.75 in premarket trading.

“Exxon Mobil’s quarterly results demonstrate the strength of our integrated business model,” Chief Executive Officer Rex Tillerson said in a statement.

Integration across the company’s exploration and production, refining and chemicals businesses provides a competitive advantage regardless of market fluctuations, said Tillerson.

Profit in the third quarter rose to $8.07bn, or $1.89 per share, from $7.87bn, or $1.79 per share in the year-ago period.

Analyst, on average, expected a profit of $1.71 per share, according to Thomson Reuters I/B/E/S.

Oil and gas production fell 4.7%, the Irving, Texas company said. Exxon said it remained on track for full-year output of 4mn barrels oil equivalent per day (boed).

Profit in its refining business soared to $1.024bn from $592mn a year earlier. Exxon’s chemicals unit had a profit of $1.2bn, up 17% from a year earlier.

Earnings in Exxon’s exploration and production business fell 4.4% to $6.4bn as lower crude oil prices took a toll.

BNP Paribas

BNP Paribas, France’s largest bank, returned to net profit in the third quarter and rebounded from a costly US legal settlement to publish what it called a “rock solid” balance sheet, sending its shares up over 4%.

BNP—battling to restore investor and client confidence after a $8.9bn fine from US authorities—reshuffled its top ranks in the quarter to tighten controls. It said veteran adviser and trouble-shooter Jean Lemierre would take the role of chairman in December.

The bank settled with US authorities in June, paying up over accusations that it violated US sanctions against Sudan, Cuba and Iran over a 10-year period up to 2012.

“The excess capital story at BNP has been derailed by litigation for the time being, but trends this quarter are encouraging,” Geoff Dowes, an analyst at Societe Generale said in a note.

BNP said yesterday its balance sheet had improved despite headwinds, reporting a core Tier 1 capital ratio under tougher Basel III rules of 10.1%. That was a small improvement from 10% at end-June, but taking into account the purchase of Polish bank BGZ and new regulatory adjustments.

Under the terms of the settlement with the US authorities, BNP must clear all its dollar transactions in New York. Any oil- and gas-related business landing there throughout 2015 will be forwarded to a correspondent bank for clearing.

BNP Chief Financial Officer Lars Machenil said the operational details were being worked out. As a result, however—and not helped by the drop in the oil price—BNP’s energy and commodities activities slowed in Europe.

“The weakness...there is somewhat an effect specific to BNP Paribas, all the things we put in motion around the settlement,” Machenil told analysts on a conference call.

“But there is a generic trend, which has to do with the price of the barrel and embargoes related to Russia”.

The bank’s quarterly net profit rose 11% to €1.5bn ($1.89bn), driven by lower provisions, while revenue rose 3.9% to €9.54bn.

Revenues in the investment banking business - a unit closely watched by the market following BNP’s settlement with the US authorities - grew by 2.9% in the third quarter.

Chevron

Chevron Corp posted a higher-than-expected quarterly profit yesterday as lower crude prices boosted its refinery operations, helping to offset sagging oil and gas production.

The company posted third-quarter net income of $5.59bn, or $2.95 per share, compared with $4.95bn, or $2.57 per share, a year earlier.

Analysts on average expected earnings of $2.55 per share, according to Thomson Reuters I/B/E/S.

Production fell nearly 1% to 2.57mn barrels of oil equivalent per day as new wells failed to offset declines at old ones.

The company’s downstream unit, which owns refineries throughout the world, posted a nearly fourfold jump in profit to $1.39bn as the cheaper crude oil prices boosted margins.

Shares of Chevron rose 1.4% to $118.20 in premarket trading.

Clorox

US cleaning products maker Clorox Co reported better-than-expected quarterly sales and adjusted profit, helped by strong demand for its household products and price increases in international markets.

The maker of Pine-Sol cleaners and Poett home care products, which had missed the Street’s profit estimates in the past four quarters, also reaffirmed its profit outlook for the year ending June. Net income from continuing operations rose to $145mn, or $1.10 per share, in the first quarter ended September 30, from $139mn, or $1.05 per share, a year earlier. Total sales rose 0.7% to $1.35bn. While revenue from household products increased 5.4% to $392mn, sales of cleaning products, Clorox’s largest business, fell 1.9% to $470mn.

Last month, the company said it was exiting Venezuela as business there was “no longer viable”.

Excluding a loss of 42 cents per share from discontinued Venezuela operations, and a one-time benefit of 5 cents per share, the company earned $1.05 per share in the first quarter.

Analysts on average had expected a profit of $1.03 per share, on revenue of $1.33bn, according to Thomson Reuters I/B/E/S.

Clorox said it continued to expect full-year earnings from continuing operations of $4.35 to $4.50 per share, and forecast flat sales mainly due to foreign currency declines in its international markets, particularly Argentina.

Finnair

Finnish airline Finnair blamed the strength of the euro against Asian currencies for a fall in quarterly net profit and sales, in results yesterday.

The company, which turned in a net profit for the third quarter of €17mn ($21.4mn), marking a 38% fall from the equivalent figure last year, was also gloomy about the outlook.

Sales fell by 2.2% to €623mn, because the euro was strong against the currencies of key Asian markets, the airline said.

The airline has high hopes for its business operating routes between Asia and Europe.

But Finnair warned that for the whole of this year, the operating figure would show a big loss because of delays in negotiations with staff on cost-cutting, and unfavourable market conditions.

It expected sales for the year to fall significantly.

The price of shares in Finnair was down 2.03% to €2.41 on the Helsinki stock exchange.

Finnair has already opened talks with employees with a view to cutting costs, and has reached agreements with pilots and cabin crew which it expects to generate savings of €35mn per year.

SNB

The Swiss central bank reported a profit equivalent to €23.6bn for the first nine months of the year on gains from currency trading and a rise in the value of its gold reserves.

The Swiss National Bank has operated a policy of holding down the value of the Swiss franc since September 2011, largely by trading in foreign currencies.

The Swiss franc has tended to rise strongly in the last few years as a refuge for investors seeking safety from the turmoil of the financial crisis and then the eurozone crisis.

The bank reported an overall profit for the nine months of 28.5bn Swiss francs ($29.7bn).

In terms of trading in foreign currencies, the central bank made 9.7bn francs, with losses on positions taken in euros more than outweighed by gains on other currencies and particularly the dollar and the British pound.

Interest payments contributed 5.7bn francs and dividends 1.4bn francs, the bank said.

The bank reported an overall gain of 25.2bn francs on its holdings of foreign currencies.

HTC

Taiwan’s smartphone maker HTC said yesterday it expected revenue in the fourth quarter to grow up to 12% on-quarter because it is launching a number of new products including the Nexus 9 tablet for Google.

HTC estimated that revenue in the fourth quarter will be in the range of Tw$43bn-Tw$47bn ($1.43bn-$1.57bn).

In October, HTC kicked off the global launch for an array of new products and services, including the HTC Desire Eye smartphone, the social video-editing application Zoe and its first-ever camera RE.

In the same month, HTC partnered with Google to unveil the Nexus 9 tablet dubbed “Lollipop”—the world’s first tablet to run on Google’s latest operating system Android 5.0.

The company is actively searching for new ways to appeal to customers and find fresh revenue streams with the launch of new products, it said in a statement.

HTC swung to a profit of Tw$640mn in the third quarter from a net loss of Tw$2.97bn in the same period last year, but revenue fell 11% on-year amid strong competition from low-priced Chinese models. “This challenging quarter saw HTC step up to the plate, maintaining profitability in the face of an intensely competitive environment,” said CEO Peter Chou.

In the 2013 third quarter, HTC swung to its first net loss since listing in 2002, as it fell out of the world’s top 10 vendors and has been struggling to increase its foothold in the highly competitive smartphone market.

ANZ

The Australia and New Zealand Banking Group (ANZ) yesterday posted record annual net profit of Aus$7.3bn ($6.5bn) - up 15%—pursuing an Asia-focused growth strategy.

Cash profit, which strips out non-core items and is favoured by analysts, was up 10% to Aus$7.10bn on last year.

The results for ANZ, one of Australia’s four major banks, were roughly in line with guidance and boosted by a 17% cut to bad debt provisions of Aus$989mn.

“This is another good performance that demonstrates consistent execution of our super regional strategy which is positioning ANZ well in a more constrained operating environment,” said chief executive Mike Smith.

“We made progress in all our key markets.”

The company’s Australian operations still generate well over half its profit and remain core, with Smith reporting that the domestic division “maintained momentum” with cash profit rising seven% and revenue five%. New Zealand recorded 10% growth in cash profit but had revenue growth of only two%. ANZ’s lucrative international and institutional banking (IIB) unit performed strongly.

Sharp

Japanese electronics giant Sharp said yesterday it saw a small profit in the first half of its fiscal year and forecast it will stay the black for the next six months as it tries to overcome years of record losses.

The Osaka-based company—a key Apple supplier and leader in screens for smartphones and tablets—reported a net profit of ¥4.7bn ($43mn) for April-September, reversing its net loss of ¥4.3bn yen a year earlier.

Sales slipped 1.1% to ¥1.32tn, while operating profit was down 13.6% from a year ago, it said.

The latest net profit figure was largely due to a one-time gain rather than a significant uptick in the firm’s business, Sharp said.

But “we also pursued management improvement on a company-wide basis, including an inventory optimisation, radical cuts in total costs and structural reform in Europe”, it said in a statement.

Sharp added that it was still on track to book a 30bn yen net profit for the full year to March.

Rivals Sony and Panasonic also report their half-year earnings yesterday, as Japan’s electronics giants scratch their way back to profitability.

GoPro

GoPro forecast better-than-expected holiday quarter sales, underscoring the increasing popularity of its wearable cameras among surfers, skydivers and other action junkies.

GoPro’s shares, which went public in June, shot up 14% in extended trading on Thursday after the company also reported strong third-quarter results.

The company said it expects a profit of 65-69 cents per share on sales of $550-$580mn for the fourth quarter ending December.

Analysts were expecting a profit of 55 cents per share on revenue of $505.5mn, according to Thomson Reuters I/B/E/S.

GoPro dominates the action camera market, with analysts estimating a market share of more than 90%.

The resounding success of its cameras has prompted several companies such as Sony Corp, Garmin Ltd and Panasonic Corp to launch their own offerings.

According to NPD Group’s Retail Tracking Service, GoPro was the top-selling camcorder in the US in 2013.

GoPro reported an adjusted profit of 12 cents per share for the third quarter ended Sept. 30, topping the average analyst estimate of 8 cents. Revenue rose about 46% to $280mn. Analysts on average had expected $265.6mn.

BayernLB

German public-sector lender BayernLB is repaying another tranche of state aid after striking a deal to sell the last of the toxic assets that brought it to the brink of failure in 2008.

Germany’s second-biggest lands bank said it will return €1.1bn ($1.4 bln) to its state owner Bavaria, leaving it with €3bn to hand back by 2019.

In the financial crisis, Bavaria injected €10bn in capital into the lender and gave it €4.8bn in guarantees for a €21bn portfolio of complex securities that turned sour after the collapse of Lehman Brothers.

The guarantee has become obsolete with the sale of a remainder of €6.5bn in asset-backed securities (ABS) - securities whose value is linked to developments in the US housing market and European commercial real estate - to international investors.

Sources familiar with the transaction said Goldman Sachs , Citi, Credit Suisse, Bank of America and JP Morgan were among the buyers. While the Munich-based lender booked a loss of €1.2bn on the ABS portfolio, the state of Bavaria benefited by collecting fees from the bank for providing the guarantees.

Sony

Sony Corp posted a smaller than expected second-quarter operating loss yesterday, hailed by its finance chief as proof that the Japanese group’s restructuring programme is paying off.

The company said the reduced operating loss was due in part to rising sales of image sensors to smartphone manufacturers, though the poor showing from its own Xperia phones weighed heavily on results.

Sales of the image sensors, used in Apple’s iPhones and increasingly in Chinese-made handsets, made the devices unit the biggest earner within Sony’s flagship electronics division and offset some of a ¥176bn ($1.58bn) impairment charge on its mobile division.

That left an overall operating loss for the three months to September 30 of ¥85.6bn, beating analyst expectations of nearly double.

“We are on our way to achieving ¥400bn in operating profit next year,” CFO Kenichiro Yoshida declared at a media briefing yesterday, referring to a target set in May when he announced plans to set aside ¥135bn to restructure the bloated electronics division.

“Restructuring is progressing well and right now we think we will be able to cut 20% of staff at our distribution companies and 30% at headquarters.” However, poor sales of the Xperia smartphone have dashed Sony’s ambitions of becoming the world’s third-biggest smartphone maker behind Apple and Samsung Electronics .

Millennium & Copthorne

Millennium & Copthorne Hotels’ third-quarter profit rose 6.6% as an increase in global business travel drove occupancy and room rates.

Pretax profit rose to 50.2mn pounds in the quarter ended September 30 from £47.1mn a year earlier.

Revenue at the company, which operates the Millennium, Grand Millennium, Copthorne and Kingsgate hotels, rose 6.2% to £215.9mn  ($345.1mn).

Revenue per available room (RevPAR), a metric of hotel health calculated by multiplying average daily room rate by occupancy rate, rose 5.5% to £77.7mn.

The increase in travel due to a recovering economy in the United Kingdom and the US has resulted in tight supply of hotel rooms and higher occupancy, allowing hoteliers to raise rates.

National Australia Bank

National Australia Bank said it was considering a float of its troubled British business after a fall of nearly 10% in cash profit due to hefty UK write-downs.

Net profit was down 1.1% at Aus $5.3bn (US$4.7bn), but cash earnings, which strip out volatile items and are more closely watched by analysts, dropped 9.8% to $5.18bn in the year to September, in line with guidance.

NAB chief executive Andrew Thorburn described the result as “disappointing.”

“While our Australia and New Zealand franchises are in good shape, it is disappointing to record a full year result that includes a $1.5bn ($1.3bn) after tax in UK conduct provisions and other impairments,” he said.

NAB has been restructuring its struggling British businesses, particularly the Clydesdale and Yorkshire banks, and at the start of the month had flagged more than US$1bn of writedowns, including an impairment charge of Aus$297mn for the introduction of costly software.

“Our clear focus is on our Australian and New Zealand franchises,” Thorburn said.

Equity Bank

Kenya’s Equity Bank Group said that pretax profits rose by a quarter in the first nine months of the year, largely due to growth in non-interest income and falling provisions for bad debts.

Equity, which focuses on the lower-income part of the market, and also operates in Uganda, South Sudan, Tanzania and Rwanda, said profit rose 25% to 15.82bn shillings ($177.16mn) for the period to the end of September from a year earlier.

Chief Executive James Mwangi told a briefing that Equity, Kenya’s biggest lender by depositors, plans to register a holding company to oversee its various units in the region.

“All the subsidiaries will be held by a non-operating group company so we can ringfence them,” Mwangi said.

Each subsidiary would be responsible for its own capital needs, as opposed to the present situation where the Kenyan parent supports the subsidiaries.

The bank is setting up a subsidiary to provide a mobile phone banking service using the network infrastructure of the east African nation’s No. 2 telecoms firm, the local arm of Bharti Airtel, and will initially rely on its existing mobile banking customers.

Mobile phone-based financial services have spread in Kenya since telecoms operator Safaricom launched its M-Pesa service in 2007, helping the country increase the number of people with access to formal financial services.

Equity said non-interest income, from activities such as foreign exchange trades, jumped 23% to 12.958bn shillings in January-September. Provisions for non-performing loans dropped 62% to 900mn shillings, Mwangi said.

Equity group’s ratio of bad debts to total loans fell to 4.3% during the period from 5.5% last year, he said.

RBS

State-backed Royal Bank of Scotland has set aside £400mn ($640mn) to cover potential fines for manipulating currency markets and warned further charges for past misconduct would continue to hit its profits.

RBS said it made a third-quarter pretax profit of £1.3bn, compared with a loss of £634mn the year before. That was ahead of an average analyst forecast of £1.1bn compiled by the bank.

An economic revival in Britain and Ireland has enabled RBS to recover debts it had written off. The bank had a net release of previously written-off loans of £801mn during the quarter, ahead of an average forecast of £590mn.

RBS’s corporate and institutional banking arm slumped to a loss of £557mn,compared with an 18mn loss a year ago.

That reflected charges of £562mn for misconduct, including £400mn for forex fines. RBS, 80%-owned by the British government following a £45bn bailout during the financial crisis of 2007 to 2009, yesterday joined other big rivals in signalling it is close to agreeing settlements over alleged manipulation of the $5.3tn-a-day foreign exchange market.

The forex manipulation, revealed after banks were already under scrutiny for profiteering in the setting of benchmark lending rates such as Libor, relates to daily fixing rates which traders are alleged to have manipulated to suit their own market positions.

RBS also faces a number of other probes relating to past misdeeds which threaten to undermine its turnaround under Chief Executive Ross McEwan, who has steered the bank back into profit this year after it made a loss of £8.2bn in 2013.

“We are actively managing down a slate of significant legacy issues. This includes significant conduct and litigation issues that will continue to hit our profits in the quarters ahead,” McEwan told reporters yesterday.