Executive Business Briefing

Here is a look at more of Tuesday's top business stories:

Earnings rise 15.6 percent at Johnson & Johnson

NEW BRUNSWICK, N.J., Oct. 16 (UPI) -- Health care giant Johnson & Johnson said its third quarter net income rose 15.6 percent to $1.53 billion, or 49 cents a diluted share, from $1.32 billion, or 43 cents a share during the same period last year.

The company said excluding special charges of $24 million, its latest net income per share for the third quarter was 50 cents.

The special charge includes remaining one-time costs associated with the company's acquisition of biotech firm ALZA Corp., completed last quarter.

Analysts on Wall Street had expected the company to post a net income of 48 cents a share, according Thomson Financial/First Call.

Total sales rose 10.8 percent to $8.2 billion from $7.4 billion a year ago. Excluding the impact of negative currency, worldwide sales increased 13.0 percent. Domestic sales were up 13.7 percent, while international sales increased 11.9 percent on an operational basis.

"I am particularly pleased with our double-digit growth in both sales and earnings as these results reflect the strength and vitality of each of our business segments. Double-digit operational sales growth also was achieved in all geographic areas," said Ralph S. Larsen, chairman and chief executive officer.

In addition, Larsen said, "Of particular note is our ability to achieve these results while intensifying our investment in research and development."

The company said worldwide pharmaceutical sales of $3.7 billion for the quarter resulted in an operational increase of 17.4 percent over the same period in 2000. Domestic sales increased 17.7 percent. International sales increased operationally 16.9 percent but were offset by a negative currency impact of 4.1 percent. Worldwide reported sales growth including a 1.3 percent negative currency impact was 16.1 percent.

United Tech posts higher results, plans to cut 5,000 jobs

HARTFORD, Conn., Oct. 16 (UPI) -- United Technologies Corp. said its third quarter net income rose 14 percent to $565 million, or $1.12 a diluted share, from $496 million, or 98 cents a share during the same period last year.

Analysts on Wall Street had expected the company to post a net income $1.12 per share, according to Thomson Financial/First Call.

The defense contractor and diversified manufacturer also said it would cut 5,000 jobs over the next year, citing the effect of the Sept. 11 attacks on its aerospace business.

Revenues rose 7 percent to $6.9 billion.

During the third quarter, the company said it benefited from a lower tax rate and higher interest income due to the settlement of certain tax audits.

The company offset this benefit with restructuring charges, primarily at Carrier and Otis.

"UTC demonstrated yet again the ability to perform under difficult conditions during the third quarter," said George David, chairman and chief executive officer.

"Carrier continues to face challenging conditions and our third quarter restructuring actions will help to streamline and improve the business.

"On the aerospace side, we are acting quickly to address the impact on our businesses of the monumental tragedy on Sept. 11. These impacts will lead to an anticipated loss of approximately 5,000 positions, to be spread over the next year. The costs of these employment adjustments were included in our revised assessment of Sept. 17, and reflect the impacts of Sept. 11, David said.

Looking ahead, David said, "We currently see full year 2001 earnings of at least $3.80, inclusive of restructuring charges and consistent with our recent estimates."

Earnings fall at Delphi Automotive

TROY, Mich., Oct. 16 (UPI) -- Delphi Automotive Systems said its third quarter net income tumbled to $26 million, or 5 cents a share, from $148 million, or 26 cents a share during the same period last year.

Revenue declined 6 percent to $6.2 billion from $6.6 billion a year ago.

Analysts on Wall Street had expected the company to post a net income of 5 cents a share, according to Thomson Financial/First Call.

Delphi said it generated strong operating cash flow of $111 million, which the company used to fund $108 million of employee separation and related payments associated with previously announced restructuring plans.

"The third quarter was undoubtedly challenging for all global companies, including those in the automotive sector," said Alan S. Dawes, Delphi's chief financial officer.

Dawes cited continued softening of auto production in North America, Europe and South America, and ongoing weak global aftermarket sales for the lower earnings. Unusual logistics and manufacturing costs incurred as a result of the September terrorist attacks, coupled with sudden late-quarter customer schedule reductions, also impacted Delphi's performance in the period, he said.

"The flexibility inherent in the Delphi Manufacturing System, combined with key business initiatives, helped Delphi meet our customer commitments while also protecting our results for the quarter," Dawes said.

Looking ahead Dawes said, "We continue to evaluate fourth quarter industry volume forecasts. Currently we expect revenues of $6.3 billion to $6.5 billion. On this basis, we expect net income of $30 million to $85 million, or 5 cents to 15 cents earnings per share, and operating cash flow of $100 million to $200 million during the period."

American Standard posts flat results, cuts jobs

PISCATAWAY, N.J., Oct. 16 (UPI) -- American Standard Cos. Inc., a maker of plumbing equipment, air conditioners and automotive systems, said its third quarter net income inched up to $90 million, or $1.23 a share, from $89 million, or the same $1.23 a share during the same period last year.

The company also said it was cutting its work force by about 1,000 salaried employees.

Analysts on Wall Street had expected the company to post a net income of $1.23 a share, according to Thomson Financial/First Call.

Total sales for the quarter fell 4 percent to $1.89 billion from $1.96 billion a year before.

In September, American Standard lowered its third quarter earnings estimates, citing the weakening economy and the Sept. 11 attacks on the United States.

"The weakened economy, worsened by the impact of the tragic Sept. 11 events, produced a revenue shortfall, which primarily reflected delays in purchases and installations of commercial air conditioning equipment," said Fred Poses, chairman and chief executive officer.

"Anticipating continued weak economic conditions ahead of us, we are regrettably reducing our work force by about 1,000 salaried employees," he said.

The company currently employs approximately 60,000 people in 27 countries.

Poses said the work force reduction will result in an estimated pretax charge against fourth quarter earnings of about $25 million, or 21 cents a share, and will produce savings of about $40 million in 2002.

Excluding the charge, American Standard estimates fourth quarter earnings of 76 cents to 82 cents a share and full-year earnings of $4.52 to $4.58 a share, up 4 percent to 5 percent over 2000 full-year earnings and the same as the company's September outlook.

Analysts on Wall Street currently expect fourth quarter operating earnings of 77 cents a share and 2001 earnings of $4.53 a share.