EARNINGS
Income increases at Discover
Discover’s fourth-quarter net income rose 6 percent as more customers paid off credit card balances on time and it wrote off fewer unpaid balances. Consumers also used their cards more as they dealt with the tail end of the back-to-school shopping season and the ramp-up to the December holidays.
But Discover’s earnings missed Wall Street’s view, and the company set aside more money to cover souring loans.
For the period ended Nov. 30, the credit-card issuer and payments-network operator earned $541 million, or $1.07 per share. That compares with $513 million, or 95 cents per share, a year earlier. Analysts surveyed by FactSet expected higher earnings of $1.12 per share.
Revenue climbed 11 percent to $2 billion from $1.81 billion, after interest expense. Wall Street forecast $1.96 billion.
Rite Aid posts quarterly profit
Rite Aid Corp., the third-largest U.S. drugstore chain, forecast better full-year results and returning to a profit in the third quarter.
The retailer, which has area operations among more than 4,600 stores in 31 states, cited strong prescription growth and higher pharmacy gross margin from the introduction of new generic medications in its fiscal third quarter ended Dec. 1.
The company forecast a net loss of 5 cents a share to net income of 3 cents for fiscal 2013. Rite Aid had previously projected a net loss of 23 cents to 9 cents a share. That compared to an average estimate for a loss of 15 cents, according to data compiled by Bloomberg.
The pharmacy retailer said third-quarter net income was $61.9 million, or 7 cents a share, compared with a loss of $52 million, or 6 cents, last year.
Darden’s net income plunges
Darden Restaurants said net income fell 37 percent in the latest quarter, as revamped menus and new ad campaigns failed to draw more diners into its Olive Garden and Red Lobster chains.
The Orlando, Fla., company had warned of a drop in sales earlier this month, blaming failed promotions and bad publicity tied to its test of limiting health care costs for workers.
The decline in traffic comes despite the company’s efforts to revamp the menus and marketing for its flagship chains. At Olive Garden, the company updated its advertising campaign and introduced more light and lower prices. At Red Lobster, it added options besides seafood.
The company said revenue at restaurants open at least a year fell 2.7 percent for its three biggest chains during the quarter; it fell 3.2 percent at Olive Garden, 2.7 percent at Red Lobster and 0.8 percent at LongHorn Steakhouse.
For the period ended Nov. 25, Darden earned $33.6 million, or 26 cents per share. That’s down from $53.7 million, or 40 cents per share, a year ago. Revenue climbed 7 percent to $1.96 billion from $1.83 billion, meeting Wall Street’s forecast.
ENERGY
More investments in Ohio
Dominion Resources Inc. said it is forming a $1.5 billion joint venture with natural gas company Caiman Energy II to provide services to gas producers working in the gas-rich Utica shale in Ohio and Pennsylvania.
The Richmond, Va., energy company said the partnership, called Blue Racer Midstream, will help companies gather, process, transport and sell natural gas liquids.
Dominion is contributing pipelines and other equipment, while Caiman provides funds.
Dominion is one of the nation’s largest producers and transporters of energy. Caiman focuses on natural gas infrastructure. It’s backed by natural gas pipeline company Williams Partners and investment firms.
Dominion is contributing its Natrium Extraction Plant to the joint venture. It is currently under construction in Marshall County, W.Va. A pipeline connecting Natrium to the Dominion East Ohio “gathering system” is also part of the plan.
Compiled from staff and wire reports