Here is a look at more of Tuesday's top business stories:
Caterpillar posts lower results
PEORIA, Ill., July 16 (UPI) -- Caterpillar Inc., the world's largest construction equipment maker, said its second-quarter net income fell to $200 million, or 58 cents a share, from $271 million, or 78 cents a share during the same period last year.
Sales declined to $5.29 billion from $5.49 billion.
Analysts on Wall Street were expecting Caterpillar to post a net income of 73 cents a share, according to Thomson Financial/First Call.
Caterpillar also lowered its forecast for the full year and now sees both 2002 sales and revenue declining slightly.
Caterpillar said it expects its 2002 profit to fall 15 percent from last year's operating profit of $902 million, or $2.60 a share, on a slight drop in sales and revenue.
Previously, the maker of construction and mining equipment predicted sales and revenue for the year would be about flat with 2001.
Wall Street expects the company to earn $2.49 a share for the year, according to First Call.
Caterpillar described the business climate for the first half of the year as "extremely difficult," although in line with its expectations. Still, the company said spending hasn't rebounded as expected.
"While overall economic indicators have been positive, the anticipated recovery in capital spending has yet to materialize," said Chairman and Chief Executive Glen Barton.
The company credited the diversity of its products and services for allowing it to remain profitable.
Caterpillar, a component of the Dow Jones industrial average, said sales weakness in North America was offset by higher sales in the Asia/Pacific and Latin America areas. Sales in Europe, Africa and the Middle East remained flat.
Sharp declines in electric power generation and coal mining sales were offset by sales of truck and bus engines. Sales to heavy construction were up, the company said.
Caterpillar said worldwide growth is developing along the lines of its prior outlook, which anticipated a gradual recovery in global production during 2002. The company said most industrialized markets continue to operate at low levels of capacity utilization.
Caterpillar said industry demand was lower than expected in the second quarter as corporate earnings failed to respond to the recovery as quickly as the company had seen in the past, which damped capital spending.
Although Caterpillar still expects an improvement in overall capital spending in the second half of 2002, the company predicts it won't be as strong as previously expected.
Continental Airlines posts loss
HOUSTON, July 16 (UPI) -- Continental Airlines Inc., the nation's fifth-largest carrier, said it posted a second-quarter loss of $139 million, or $2.18 a share, compared with a net income of $42 million, or 74 cents a share during the same period last year.
Revenue fell 15 percent to $2.1 billion.
Excluding charges to write down the value of planes and a government grant, the loss was $35 million, or 55 cents a share.
According to Thomson Financial/First Call, analysts on Wall Street were expecting Continental to report a loss of 75 cents a share.
Gordon Bethune, chairman and chief executive officer, said, "Heavy fare discounting and a sluggish economy are bad enough, but when coupled with extraordinarily high security costs and the increasing airport 'hassle factor' we're in a no-win situation.
"While it's great to outperform all of our hub and spoke competitors, we still need to find a way to make money," Bethune said.
The airline said its second quarter passenger revenue fell 14.8 percent to $2.1 billion due to traffic and capacity declines and widespread industry fare discounting.
Continental said it achieved a record mainline jet load factor of 75.3 percent in the second quarter on substantially reduced capacity.
While the airline's second quarter mainline jet capacity was down 9.8 percent compared with the same period in the prior year, Continental said it achieved a 1.5 point premium to the industry average load factor by closely managing capacity and utilizing the right-size aircraft to meet market demand.
Industry fare discounting drove Continental's consolidated breakeven load factor up to 76.9 percent, an increase of 5.7 points over the second quarter of last year.
Larry Kellner, president, said, "As would be expected, bookings look good in this heavily discounted fare environment, unfortunately we do not expect to see improvement in near-term yields."
Earnings decline at Schwab
SAN FRANCISCO, July 16 (UPI) -- Charles Schwab Corp., the nation's largest discount brokerage firm, said its second-quarter net income slipped to $98 million, or 7 cents a share, from $102 million, or a similar 7 cents a share during the same period last year.
Revenue dipped to $1.0 billion from $1.1 billion a year ago.
Excluding special items, Schwab reported a net income of $106 million, or 7 cents a share.
Charles Schwab Corp. missed Wall Street's earnings estimate by 1 cent a share in the second quarter, according to Thomson Financial/First Call.
Some analysts expected the discount financial services firm to miss the consensus estimate because of the continued trading slump caused by uncertainty in the economy, a weak stock market and negative news about corporate practices.
"Individual investor confidence remains shaken by ongoing corporate accounting and governance breakdowns and geopolitical worries," said Chairman and co-Chief Executive Charles R. Schwab.
"Although client trading volumes were relatively flat from April through June, we have continued to build new and stronger relationships with individual investors as they increasingly recognize us as a trusted financial partner, uniquely capable of serving their needs."
The firm reported clients opened 225,000 new accounts during the quarter, helping boost active accounts by 4 percent to 8 million by the end of the second quarter.
Clients brought $12 billion in new assets to the company during the second quarter with total assets in client accounts falling 7 percent to $797 billion at the end of June.
Charles Schwab has 4.3 million accounts with $308 billion in assets using online services at Schwab.
This compared with about the same number of accounts holding $349 billion in assets at the end of June 2001. Online trades made up 83 percent of all trades during the latest second quarter, up from 80 percent last year.
Last quarter, Schwab announced plans to expand its private-client group. The unit's stockbrokers offer investment advice to individuals with at least $500,000 to invest who wish to retain ultimate control of their portfolios.
Schwab also retooled its referral program for independent investment advisers and introduced a new rating system to grade stocks, which Schwab is billing as an alternative to the research offered by the traditional Wall Street investment banks.
During the latest quarter, Schwab introduced its MarketMasters Funds to strengthen its mutual fund lineup.
By the end of June, client asset balances in mutual funds at Schwab totaled $337 billion, including $81 billion in third-party Mutual Fund OneSourc funds, $22 billion in clearing business, $76 billion in other third-party Mutual Fund Marketplace funds, and $158 billion in proprietary SchwabFunds and Excelsior funds.
Earnings decline at Rockwell Collins
CEDAR RAPIDS, Iowa, July 16 (UPI) -- Aviation electronics maker Rockwell Collins Inc., citing the slump in the commercial aviation market, said its third-quarter net income fell to $60 million, or 33 cents a share, from $71 million, or 38 cents a share during the same period last year.
The company, which makes cockpit instruments and other components, said its sales declined to $623 million from $727 million a year ago.
Analysts on Wall Street were expecting Rockwell to post a net income of 32 cents a share, according to Thomson Financial/First Call.
Rockwell's military business performed strongly, but this was not enough to overcome the slowdown on its commercial side, which has been under pressure since the Sept. 11 attacks cooled air travel around the United States.
Clay Jones, chairman, president and chief executive officer, said, "Our diverse and balanced business model continues to help us achieve strong profitability in the markets we serve. In addition, our continued focus on reducing both accounts receivable and inventory levels this year have led to the generation of significant free cash flow."
The company said its Commercial Systems unit, which provides aviation electronics and in-flight entertainment products to air transport, business and regional aircraft manufacturers and airlines worldwide, reported sales of $336 million, a decline of $92 million or 21 percent from last year.
The decline resulted primarily from lower sales of commercial avionics to the air transport marketplace and lower business and regional jet avionics sales, due to the effects of the strike at Bombardier.
The company said its Government Systems unit, which provides aviation electronics and communications products to the U.S. government, foreign militaries and manufacturers of military aircraft, reported sales of $287 million in the third quarter, a modest decline from the $299 million in the third quarter of last year.
Higher sales in products resulting from military surge activities, and the C-130 integrated applications product line, nearly offset a $26 million decline in sales related to a KC-135 aircraft retrofit program that was completed in the third quarter of fiscal 2001.
Whirlpool's earnings rise 20 percent
BENTON HARBOR, Mich., July 16 (UPI) -- Appliance giant Whirlpool Corp. said its second-quarter net income rose 20 percent to $63 million, or 91 cents a share, from $53 million, or 78 cents a share during the same period last year.
The company reported core earnings of $104 million, or $1.48 a share, compared with $88 million, or $1.30 a share a year ago.
The core earnings excluded restructuring and other charges.
Analysts on Wall Street were expecting the company to post a core net income of $1.46 a share, according to Thomson Financial/First Call.
Net sales increased 6 percent to $2.7 billion.
David R. Whitwam, chairman and chief executive officer, said, "These results demonstrate the consistent and significant contributions from our North American operations, the improving performance of our European operations and the strength of the company's global brands."
Whirlpool said its North America unit delivered a strong improvement in operating results as robust consumer spending continued during the quarter.
Net sales increased 11 percent from the same period last year, outpacing U.S. appliance industry unit shipments.
Market share increased from the previous quarter on the strength of the company's continuing introduction of innovation to the marketplace. Operating profit increased by 20 percent.
Whirlpool said Europe's operating performance improved in the quarter, despite the continuing weakness of European economies.
Net sales increased 5 percent, or up 2 percent excluding currency translations, as European industry unit shipments declined between 1 and 2 percent from the same period last year.
Whirlpool said its Latin American performance was affected by continuing economic uncertainty and challenging conditions within the region. Brazilian appliance industry unit shipments softened significantly compared to the second quarter of 2001. In this environment, the company reduced production rates as well as company and retailer inventory levels, which contributed to a 4.7 point decline in operating margins.
Looking ahead Whitwam said, "For the remainder of the year, we expect our operating performance to continue to improve as our operations introduce new innovative products to consumers and realize the benefits of the company's restructuring and ongoing productivity improvement efforts.
"Based on current forecasts of global economies and industry conditions, we continue to expect a 10 percent improvement in full-year core earnings in 2002," he added.
Earnings decline at Golden State Bancorp
SAN FRANCISCO, July 16 (UPI) -- Bank holding company Golden State Bancorp Inc. reported an 18 percent decline in its second-quarter earnings.
The company reported its net income fell to $85.3 million, or 59 cents a share, from $104.2 million, or 72 cents a share during the same period a year earlier.
Analysts on Wall Street were expecting the lender to post a net income of 87 cents a share, according to Thomson Financial/First Call.
The latest results included the impact of additions to provisions for mortgage servicing.
Citigroup Inc., the nation's largest financial services company, announced on May 21 it planned to acquire the West Coast thrift.
Earnings rise 5 percent at Gannet
MCLEAN, Va., July 16 (UPI) -- Gannet Co. Inc., publisher of USA Today, said its second-quarter net income rose by 5 percent to $303.9 million, or $1.13 a share, from $288.9 million, or $1.08 a share during the same period last year.
The year-ago results exclude 20 cents a share in goodwill amortization expense that would not have been required if current accounting rules were in effect.
Gannett, which is the largest U.S. newspaper company with more than 90 newspapers as well as 22 television stations, said revenues were little changed at $1.62 billion.
Analysts on Wall Street had expected the company to report a net income of $1.13 a share, according to Thomson Financial/First Call. The company said in June it expected earnings at the upper end of a $1.11 to $1.13 range.
