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American Express' profits
rise
BLOOMBERG NEWS
January 25,
2005
American Express Co., the
fourth-biggest U.S. credit-card issuer, said profits rose 17 percent
last quarter, the biggest jump in two years, as rising consumer
confidence spurred record card use.
Net income climbed to
$896 million, or 71 cents a share, from $763 million, or 59 cents, a
year earlier, the New York-based company said.
Chief
executive Kenneth Chenault has increased quarterly earnings by more
than 10 percent for three years, the longest streak of any company
in the 30-member Dow Jones industrial average. American Express got
a boost in the quarter as U.S. retail sales increased 9.4 percent,
based on Bloomberg same-store sales data.
"These guys know
how to market, and they deliver," said Forrest Mervine, who helps
manage $1.4 billion at the Philadelphia Corp., which holds about
200,000 American Express shares and has never sold any. "People feel
comfortable with them."
The company added 4.9-million
cardholders, for a total of 65.4 million. Outstanding card balances
rose 7.2 percent to $46.5 billion. Revenue increased 10 percent to
$7.77 billion.
In other earnings news, U.S. Steel Corp., the
biggest steelmaker in the Americas, had net income of $462 million
in the fourth quarter on improving demand and high steel
prices.
Profit was $3.55 a share, compared with a
year-earlier net loss of $22 million, or 26 cents. Sales rose 51
percent to $3.93 billion from $2.61 billion, Pittsburgh-based U.S.
Steel said in a statement today.
Improvement in U.S. demand
and chief executive John Surma's push to expand in Eastern Europe
helped U.S. Steel benefit from higher prices in those regions. Cost
cuts made after the May 2003 acquisition of bankrupt National Steel
Corp. also helped preserve profit margins as raw-material costs
rose.
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