Earnings Release – 28 Feb 2014

Edited by Vani Rao

Best Buy swings back into the black, exceeds expectations

Best Buy Company Inc. (NYSE:BBY) swung back into the black, reporting Q4 net earnings of $310 million, compared with a net loss of $461 million in the year-ago quarter. However, revenue dipped 3% to $14.47 billion. Best Buy’s Q4 FY2014 adjusted earnings stood at $1.24 per share, compared with earnings of $1.47 in the year-ago period. The company’s earnings in the reported quarter surpassed the Thomson Reuters earnings estimates of $1.01. Best Buy’s earnings were boosted by its cost-cutting strategy as a part of its transformation program. The world’s largest consumer electronics chain managed to cut annualized costs of $765 million, more than its own projections of $725 million. Looking forward, Hubert Joly, CEO, is targeting to cut costs by $1 billion in the forthcoming year. The company’s management is currently implementing a competitive pricing strategy and making investments in mobile, online, and the multi-channel approach.

Linn Energy reports wider losses in Q4

Linn Energy LLC (NASDAQ:LINE) reported wider Q4 2013 losses of $784.55 million, or $3.15 a share, compared to losses of $187.5 million, or 83 cents a share, in Q4 2012. The company’s wider losses are attributed to higher impairment charges and lower profits on oil and natural gas derivatives. However, revenue grew to $629.21 million from $571.23 million in the prior-year quarter, outperforming the Thomson Reuters consensus estimates of $627.29 million. During the quarter under review, the company’s production stood at an average of 845 cubic feet of natural gas equivalent per day, or MMcfe/d, which was at the lower range of the company’s projection of 840-860 MMcfe/d. The lower production is mainly attributed to the severe winter weather conditions during the past quarter. Linn Energy, in its production guidance for Q1 2014, expects production to average between 1,070 and 1,100 MMcfe/d. Following the company’s disappointing results, its shares slid 4.56% to close the day at $31.40 on Thursday, 27 February 2014.

Wendy’s reports higher earnings in Q4, reaffirms outlook for 2014

The Wendy’s Company (NASDAQ:WEN) reported a 25% rise in its fourth quarter earnings to $33.1 million, or 8 cents per share, from $26.4 million, or 7 cents per share, in the year-ago period. However, revenue dropped 6% to $592.4 million from $629.9 million, missing Wall Street’s revenue estimates of $593.4 million. The company’s earnings growth was boosted by a reduction in costs and expenses, which declined to $563.5 million in Q4 2013 from $597.6 million in the same quarter last year. In addition, interest expenses narrowed to $13.5 million from $20.8 million. The fast food chain reaffirmed its outlook for FY2014, expecting adjusted EBITDA in range of $390-400 million, adjusted EPS of 34-36 cents and same-restaurant sales growth of 2.5-3.5% at its company-operated restaurants.

Gap’s fourth-quarter earnings drops due to markdowns during holiday season

The Gap Inc.’s (NYSE:GPS) fourth quarter earnings fell by 12.5% to $307 million, or 68 cents per share, compared with $351 million, or 73 cents per share, in the year-ago quarter. Revenue also dropped 3% to $4.58 billion from $4.73 billion in the comparable period last year. Like most retailers, Gap’s profits dropped on account of the tough retail environment and sluggish holiday season, during which the company’s heavy markdowns failed to attract shoppers. However, revenue at stores opened at least a year improved 1%. Looking forward, the San Francisco-based company is expecting earnings of $2.90-2.95 per share until January 2015. Gap’s management also announced a 10% raise in its quarterly dividend to 22 cents.

Lower oil prices widen Breitburn’s losses, but production reaches record levels

Breitburn Energy Partners L.P. (NASDAQ:BBEP) reported wider losses of $58.8 million, or $0.52 per diluted share for Q4 2013, compared to losses of $25 million, or $0.25 per diluted share, in the prior-year quarter. The company’s earnings were hit by lower oil prices and stagnant production. During the quarter under review, the company realized oil prices of $88.77 per barrel, compared to $100.94 per barrel in Q3 2013. Moreover, Breitburn’s fourth quarter oil and gas production fell to 3,086 million barrels of oil equivalent (MBOE), from the 3,098 MBOE in Q3 2013. On a brighter note, production levels reached a record 1.9 MBOE, representing a 90% increase from the same quarter last year. As an outlook for FY2014, the company projects its total production to range between 13.6 MBOE and 14.4 MBOE. Adjusted EBITDA, before any acquisitions, is expected to range between $500 million and $510 million during the year.

Upcoming Earning Releases

Pepco Holdings Inc. (NYSE:POM) is slated to release its quarterly results before the opening bell on Friday, 28 February 2014. The Washington-based electric utilities company last month declared a dividend of 27 cents per share payable on March 31, 2014. The Wall Street is expecting earnings of 21 cents per share for the reporting quarter.

3D Systems Corp. (NYSE:DDD) is expected to announce its fourth-quarter and year-end earnings results before the market hours on February 28, 2014. The Wall Street has a positive outlook for the reporting quarter and expects a 53% revenue growth compared to Q4 2012 and forecasts EPS of 22 cents.

Isis Pharmaceuticals Inc. (NASDAQ:ISIS) is scheduled to announce its fourth-quarter and year-end earnings results on Friday. The company reported a net loss of 21 cents in Q3 FY2013. Wall Street is expecting a loss of 18 cents per share in the reporting quarter. The California-based drug manufacturer last week reported positive top line results.

Pennsylvania-based specialty healthcare company Endo Health Solutions Inc. (NASDAQ:ENDP) is slated to announce its Q4 results on Friday, 28 February 2014. This will be company’s first quarterly results since its acquisition of Boca Pharmacal, a specialty pharmaceutical company, for $225 million in cash. Analysts at Wall Street are expecting the company to report an EPS of 94 cents.

California-based electric utilities company Pattern Energy Group Inc. (NASDAQ:PEGI) will release its earnings data on Friday, before the market bell. Analysts are expecting company to report a net loss of 14 cents per share.

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