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The Honolulu Advertiser

Posted at 1:09 p.m., Wednesday, April 25, 2007

Business highlights: Apple, Delta, Boeing, dollar/euro

Associated Press

STRONG iPOD SALES BOOST APPLE'S PROFITS

SAN JOSE, Calif. — Apple Inc. blew past Wall Street expectations Wednesday, posting quarterly profits that jumped by 88 percent, fueled by strong sales of its iPod players and Macintosh computers.

In the first three months of the year, the Cupertino-based company said it earned $770 million, or 87 cents per share, up from $410 million, or 47 cents per share, in the year-ago period.

Sales were $5.26 billion, up 21 percent from $4.36 billion last year.

Analysts, on average, were looking for earnings of 64 cents per share on sales of $5.17 billion, according to a poll by Thomson Financial.

Apple said it shipped 1.5 million Macintosh computers and more than 10.5 million iPods during the quarter, representing a 36 percent growth in Macs and 24 percent growth in the music players.

NEW BID COMES IN FOR NETHERLANDS BANK

AMSTERDAM, Netherlands — One of the largest takeovers in corporate history escalated into a bidding war Wednesday as a group led by Royal Bank of Scotland said it planned a bid worth almost $100 billion for ABN Amro that tops a Barclays' offer by more than 10 percent.

Shareholders immediately pressured ABN to commit to accepting the highest bid, ahead of the Dutch bank's annual shareholders' meeting Thursday, and analysts said the key battleground is LaSalle Bank in the United States. One analyst called LaSalle the "crown jewel" of ABN's international operations.

Royal Bank of Scotland PLC, Spain's Banco Santander Central Hispano SA and Belgian-Dutch bank Fortis NV said they would offer around 39.00 euros ($52.95) per share for ABN Amro Holding NV — 70 percent in cash and 30 percent in RBS shares — valuing ABN Amro at roughly 72.2 billion euros ($98.1 billion).

DELTA TO SOON EMERGE FROM BANKRUPTCY

NEW YORK — A federal bankruptcy judge approved on Wednesday a Delta Air Lines plan to exit bankruptcy after the nation's third-largest airline spent nearly 20 months in a wrenching reorganization that cut 6,000 jobs and slashed $3 billion in costs.

Atlanta-based Delta Air Lines Inc. expects to emerge from court protection Monday. It estimates it will be worth $9.4 billion to $12 billion, after Delta reduced labor costs, restructured its fleet and terminated a pilots pension plan.

More than 95 percent of creditors voted to endorse the plan for Delta to leave bankruptcy as a stand alone carrier. That plan had been put in jeopardy by a $9.8 billion hostile takeover bid launched last fall by Tempe, Ariz.-based US Airways Group Inc. Delta successfully persuaded creditors to back its blueprint to emerge from bankruptcy and reject the buyout offer.

CONOCOPHILLIPS SEES PROFITS RISE, REVENUE DROP

NEW YORK — ConocoPhillips said Wednesday that asset sales pushed its first-quarter profits up 7.7 percent, but the oil major's key exploration and production arm was hurt by lower commodity prices and the company warned of lower production.

Net income for the Houston-based company rose to $3.55 billion, or $2.12 a share, for the January-March period, from $3.29 billion, or $2.34 a share, in the year-ago quarter.

ConocoPhillips said its profit included a one-time net benefit of 29 cents a share from the sale of assets.

Revenue fell 12 percent to $41.3 billion from $46.9 billion a year ago.

ConocoPhillips is the second major oil company to report earnings in as many days. BP PLC, Europe's second-largest oil company, on Tuesday reported a 17 percent drop in first-quarter earnings on lower oil prices and declining production. Exxon Mobil Corp., the world's largest publicly traded oil company, reports first-quarter results Thursday.

Wall Street analysts polled by Thomson Financial before results were released expected ConocoPhillips to earn $1.86 a share on revenue of $55 billion.

MANUFACTURING ACTIVITY SLOWS ACROSS THE COUNTRY

WASHINGTON — Most parts of the country showed moderate economic growth in the early spring despite sluggish manufacturing largely due to the housing slump.

The fresh snapshot of the national economy, released Wednesday by the Federal Reserve, found manufacturing activity slow in many areas. Activity in residential real estate continued to weaken.

Overall, most regions reported "only modest or moderate expansions," the Fed said. But the Minneapolis region posted "firm growth" and the Dallas area characterized economic activity as "moderately strong."

Information from the survey will figure into discussions at the central bank's next meeting, on May 9. Many economists predict the Fed will continue to hold a key interest rate at 5.25 percent, where it has stood since June.

Before taking a breather, the Fed steadily had boosted rates for two years to ward off inflation.

BOEING REPORTS JUMP IN EARNINGS

CHICAGO — Boeing Co. put more pressure on its European rival Airbus Wednesday in the dog fight for the slot as the world's No. 1 airplane maker.

Boeing reported a 27 percent boost in first-quarter earnings that beat Wall Street projections, while its backlog surged to another record level. Meanwhile, its revenue grew 8 percent.

Earlier this year, Boeing surpassed Airbus in plane orders, but the European company delivered more aircraft and held its position as the world's top airplane manufacturer. Boeing is expected to outpace Airbus' deliveries next year.

Chicago-based Boeing earned $877 million, or $1.13 per share, in the quarter ended March 31, compared with $692 million, or 88 cents per share, a year earlier.

Revenue climbed 8 percent to $15.4 billion, beating Wall Street expectations. During the year-ago period, Boeing had revenue of $14.3 billion.

DOLLAR TRADES NEAR ALL-TIME LOW AGAINST EURO

NEW YORK — The dollar traded within a whisker Wednesday of an all-time low against the euro, which passed $1.3660 on rising business confidence in Germany and disappointing sales of new homes in the U.S.

The euro, which peaked at $1.3667 in December 2004, climbed to $1.3664 in late afternoon European trading after the release of Germany's closely watched Ifo business confidence index. The euro bought $1.3626 late Tuesday in New York.

The index posted an unexpected increase in April — underscoring growing optimism about the 13-nation euro zone's largest economy.

The euro fell back to $1.3640 after the U.S. Commerce Department reported that sales of new homes rebounded slightly in March, but not enough to offset declines in January and February.

DEFENSE CONTRACTORS RELUCTANT TO RAISE PROFIT OUTLOOKS

BOSTON — Profit outlooks for defense contractors have turned murky as Congress faces down President Bush over defense funding and the war in Iraq, and the Pentagon subjects contractors to greater scrutiny over performance.

General Dynamics Corp. and Raytheon Co. on Wednesday posted modestly higher first-quarter earnings that beat Wall Street's expectations, but the two companies were reluctant to raise their profit outlooks for the full year, citing unusually high uncertainty over future Pentagon funding.

General Dynamics, the fourth-largest Pentagon contractor, posted a 16 percent profit increase for the January-through-March period on improved results from its private jet, information technology and military vehicle units.

The Falls Church, Va.-based company reported net earnings of $434 million, or $1.06 per share, up from $374 million, or 92 cents per share, in the year-ago quarter. Revenue rose 14 percent to $6.3 billion from $5.5 billion.