Business news in brief

Posted: July 25, 2012

In the Region

DuPont profit down 3 percent

The DuPont Co., Wilmington, reported a 3 percent decline in second-quarter earnings as volumes were off in several business units, including its performance chemicals, electronics, and safety product businesses. But its adjusted earnings still beat Wall Street estimates. Revenue rose 7 percent but was below analysts' expectations. DuPont said it expects full-year earnings to be near the lower end of its range of $4.20 to $4.40 per share, excluding significant items, because of uncertainties regarding macroeconomic conditions and a higher tax rate related to its earnings mix. DuPont said its net income totaled $1.18 billion, or $1.25 per share, for the three months ending June 30, down from $1.22 billion, or $1.29 per share, for the same period last year. Excluding onetime items, net income was $1.48 per share. Revenue rose 7 percent to $11 billion, up from $10.26 billion for the 2011 second quarter. - AP

SAP profit up 12 percent

Fewer but bigger software deals and increased sales to financial and retail companies helped SAP AG post a 12 percent increase in earnings in the second quarter of the year. The company has major operations in Newtown Square. SAP said net profits rose to (euro) 661 million ($800 million) from (euro) 588 million in the same period a year earlier. Revenue jumped 18 percent to (euro) 3.898 billion, with double-digit increases in all regions. SAP's main business is making and servicing software that helps companies manage administrative functions such as human resources, accounting and sales. SAP confirmed its outlook for the year, predicting software and service revenue would grow 10 percent to 12 percent, disregarding currency exchange rate fluctuations. - AP

Higher costs pinch earnings

Gamblers spent more money on games and buying food and drinks during Penn National Gaming Inc.'s second quarter. But the Wyomissing, Pa., casino operator's net income declined 12 percent as it faced higher operating expenses and taxes. Penn cut its full-year earnings outlook as it deals with new competition. It reported net income of $66.7 million, or 63 cents per share, for the three months ended June 30 compared with $76 million, or 71 cents per share, a year ago. The prior-year period included an insurance settlement related to a fire at the Hollywood Casino Joliet and an income tax rate reversal. Penn Gaming's revenue increased 4 percent to $712.6 million from $687.9 million when promotional allowances were stripped out. - AP

Elsewhere

Profit, sales lag expectations

Apple Inc.'s profit and sales fell short of analysts' projections for only the second time since 2003 as customers held off on iPhone purchases while waiting for a new model to be introduced this year. Net income climbed 21 percent to $8.82 billion, or $9.32 a share, in the period that ended June 30, Apple said in a statement. Sales rose 23 percent to $35 billion. Analysts had predicted profit of $10.37 a share on revenue of $37.2 billion, the average of estimates compiled by Bloomberg. The iPhone is Apple's biggest source of revenue. - Bloomberg News

Netflix profit down 91 percent

Netflix Inc. said its second-quarter earnings plunged 91 percent amid a slowdown in subscriber growth. The financial deterioration reported Tuesday follows a rare loss for Netflix during the opening three months of the year. In the latest quarter, Netflix Inc. added 1.1 million worldwide subscribers to its service that streams unlimited video over TVs and other Internet-connected devices for $8 per month. Netflix earned $6.2 million, or 11 cents per share, in the quarter. That compared with $68 million, or $1.26 per share, a year ago. Revenue rose 13 percent to $889 million to match analyst estimates. - AP

Appeals court rules against airlines

A federal court has ruled against the airline industry in support of new pro-consumer regulations. The U.S. Court of Appeals in Washington said the government can require airlines to show consumers a total ticket price that includes taxes and fees in print and online ads. The court said in a decision released Tuesday that the Department of Transportation has the authority to regulate "unfair and deceptive" airline industry practices. The ruling also covers two other regulations: a requirement that airlines allow consumers who buy tickets more than a week in advance the option of canceling their reservations without penalty within 24 hours after purchase, and a ban on airlines increasing the price of tickets or baggage fees after tickets have been bought. The rules had been challenged by Spirit and Southwest Airlines, with the support of two major airline industry trade associations. - AP

Companies recall strollers

Peg Perego USA Inc. is recalling hundreds of thousands of strollers because children can become trapped and strangled between trays on them. One death has already been reported. The company is recalling 223,000 strollers, which include Venezia and Pliko-P3 strollers made between January 2004 and September 2007. Only strollers with a child tray and one cup holder are part of the recall. Separately, Kolcraft Enterprises Inc. is recalling some strollers due to potential falling and choking hazards. Kolcraft is recalling about 5,600 of the Contours Options LT tandem strollers sold between February and July. - AP

Wal-Mart opposes fee deal

Wal-Mart Stores Inc. urged retailers to reject a proposed $6 billion settlement that Visa Inc., MasterCard Inc. and major banks have agreed to pay retailers for alleged fee fixing. The settlement, reached this month, had been considered a victory for retailers. It settled a lawsuit that contended card issuers conspired to fix merchants' fees for accepting credit cards. But Wal-Mart said Tuesday that the settlement doesn't restrict credit card issuers from continually raising fees that merchants must pay when shoppers use their cards. It also says the settlement would require retailers to waive their rights to take action against card issuers. - AP

Former Irish bank official charged

Former Anglo Irish Bank Corp. Chairman Sean Fitzpatrick was charged after a fraud investigation into the failed lender that has cost Irish taxpayers $35 billion to bail out. Fitzpatrick was arrested Tuesday and charged with breaches of company law, Detective Sgt. Brian Mahon said at a court hearing in Dublin.    

- Bloomberg News

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