American Express Reports Q2 EPS Of $1.47
American Express Company (NYSE: AXP), the New York City-based global services company that offers charge and credit cards, business credit cards, travel services, gift cards, prepaid cards and merchant services, reported financial results today for its second-quarter 2017, as follows:
In reference to the Q2 results Chairman and CEO, Kenneth I. Chenault, said:
"We...continue to execute a strategy that is transforming our consumer, commercial and merchant businesses...[and] while...[this has] suppressed short-term results, we believe it will put us in a stronger position for the longer term...
Beyond any one quarter, though, we’ve been focused on emerging from the transition with a stronger, leaner, more diversified, mix of businesses...The work is not complete, but we’re now moving forward with a stronger foundation and a blueprint for growth in the years ahead...
While this work was underway, we maintained a strong balance sheet and results from the Federal Reserve’s recent stress test show a resilient business model. We’re pleased that the Fed approved our plan to return an additional $4.4 billion to shareholders over the next four quarters through share repurchases."
Specifically,
Net income was DOWN 33% to $1.3 billion from the same period a year ago
- >U.S. Consumer Services: DOWN 59% to $440 million from a year ago related to the Costco U.S. relationship that has
since been discontinued. - >International Consumer and Network Services: DOWN 8% to $209 million from a year ago
- >Global Commercial Services: DOWN 13% to $500 million from a year ago
- >Global Merchant Services: UP 15% to $430 million a year ago
- >Corporate and Other: a net loss of $239 million compared with a net loss of $229 million a year ago.
Diluted earnings per share: were DOWN 30% to $1.47 from a year ago but $0.03 better than the Wall Street consensus estimate of $1.44.
Consolidated total revenues net of interest expense: were UP 1% to $8.3 billion from a year ago topping analysts’ view for $8.2 billion.
Consolidated provisions for losses: were UP 26% to $584 million from a year ago blaming strong loan portfolio growth and a higher lending write-off rate for the change.
Consolidated expenses: were UP 21% to $5.8 billion from a year ago.
Operating expenses: were UP 39% versus the prior year.
Return on average equity (ROE): was DOWN 4.7% to 21.7% from 26.4% a year ago.
Fiscal Year 2016 Guidance
American Express reaffirmed its 2016 outlook for EPS of $5.60 to $5.80 in line with the $5.70 per share that analysts are looking for this year.