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Executive Business Briefing

  |   May 14, 2003 at 11:11 AM
Here is a look at more of Wednesday's top business stories:


Anheuser-Busch lifts earnings outlook

ST. LOUIS, May 14 (UPI) -- Anheuser-Busch Cos. has raised its 2003 target for earnings per share growth to 12 percent to 13 percent, reflecting higher expectations for revenue per barrel.

On April 23, the company projected it would achieve a 12 percent earnings-per-share growth objective for 2003. The brewer also expected that its revenue per barrel growth to be 2.2 percent to 2.5 percent this year.

The beer brewer also said it expects 2004 earnings per share to rise 12 percent.

The company's target for 2003 suggests earnings of $2.46 to $2.49 a share, which brackets Thomson First Call's current estimate of Wall Street analysts of $2.48 a share.

In 2002, Anheuser-Busch earned $2.20 a share. Wall Street projects 2004 earnings of $2.74 a share.

The company said the U.S. is "the largest beer profit pool in the world." Anheuser-Busch's domestic beer company has roughly a 50 percent market share, the company said.

"The pricing environment in the U.S. beer industry remains very favorable," said President August Busch IV. "Beer drinkers continue to trade up, and market activity has become much more focused on building brand equity."

International sales have also contributed 20 percent or more to the company's earnings-per-share growth rate in recent years, the company said.


Cincinnati Financial issues catastrophe loss estimate

CINCINNATI, May 14 (UPI) -- Insurance company Cincinnati Financial Corp. said its preliminary estimate is for about $48 million of second-quarter pretax catastrophe losses resulting from severe weather through May 11.

The company said the storm losses, which affected policyholders of Cincinnati Insurance Cos., are expected to add about 7.5 percentage points to the second-quarter property/casualty combined ratio. The expected impact on after-tax share earnings for the second quarter would be about 19 cents.

The company said the preliminary estimate includes an updated estimate of about $13 million for April storm losses, which were previously estimated at $9 million, and an initial estimate of $35 million, net of reinsurance, for storm damage on May 2-11.

Cincinnati's policyholders across 16 Midwestern and mid-Atlantic states have reported more than 2,800 claims as a result of severe weather over these 10 days.

The $48 million total for storm losses through May 11 compares with actual pretax catastrophe losses for the full second quarter of 2002 of $47 million, which added 8.1 percentage points to the combined ratio and reduced after-tax share earnings by 19 cents.

For the comparable 2001 period, catastrophe losses were $35 million, adding 6.9 percentage points to the combined ratio and reducing earnings per share by 14 cents.

The company said its target for the full-year combined ratio is 99 percent or below on a GAAP basis, or 98.5 percent or below on a statutory basis. This target assumes that full-year storm losses will be about $75 million or in the range of 3 percentage points, with higher levels in the second and third quarters.

The insurance company said it will re-evaluate this target as further severe weather occurs or as adjustments are needed to these early estimates.


DaVita buys 3 outpatient dialysis businesses

TORRANCE, Calif., May 14 (UPI) -- DaVita Inc. said it has reached agreements to acquire three outpatient dialysis businesses in Washington state and Virginia, adding a total of 250 patients in the two markets.

The company purchased Providence Health System's outpatient dialysis business in Yakima, Wash. Two other facilities were purchased from Bon Secours Hampton Roads Health System in Newport News and Portsmouth, Va.

Terms of the deals were not disclosed.

The company said it will also manage the inpatient dialysis services for Bon Secours Maryview Medical Center patients.

DaVita provides dialysis services for patients suffering from chronic kidney failure. As of March 31, the company operated 523 outpatient facilities serving about 45,000 patients.


New York Times revenue flat with last year

NEW YORK, May 14 (UPI) -- New York Times Co. said its advertising revenues for its Newspaper Group in April were on a par with the results for the same period last year.

The media company said advertising revenues at The New York Times and The Boston Globe were lower in the initial weeks of April than in the second part of the month, when advertising revenues strengthened with the end of the war in Iraq.

"Specifically, The Times experienced a significant improvement in the cosmetics, financial, media and transportation/travel categories," the company said.

Including the results of the International Herald Tribune, which was acquired on Jan. 1, advertising revenues for the Newspaper Group for April were also on a par with last year.

Advertising revenue for The New York Times, excluding the International Herald Tribune, declined 1 percent in April compared with a year earlier. National advertising revenue rose as strength in technology products, telecommunications, entertainment, cosmetics and healthcare/pharmaceuticals offset weakness in the transportation/travel, hotel and banking advertising categories.

Retail advertising increased mainly due to growth in department-store advertising. Classified advertising declined due to weakness in the help-wanted category, which more than offset continued strength in residential real estate advertising.

Ad revenue for the New England group declined 1.3 percent in April from a year earlier. National advertising revenue increased due to growth in telecommunications, healthcare, technology products and entertainment advertising, which more than offset softness in the travel category. Retail advertising declined mainly due to weakness in home-related store advertising.

Advertising revenue for the Regional Newspaper Group increased 1.2 percent in April from a year earlier. National advertising revenue increased as a result of additional telecommunications and national automotive advertising. Retail advertising was on a par with the prior year as strength at the group's newspapers in Florida offset weakness at those in California and the Carolinas.

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