Chevron U.S. revenue weak

The energy giant said Q1 EPS fell 2.8% to $ 3.18, beating views by 10 cents. U.S. upstream earnings, which include drilling and exploration, fell 26% to $ 1.13 bil on lower crude oil prices and higher operating expenses. Int’l upstream earnings rose 4% to $ 4.8 bil on lower exploration. Chevron’s (CVX) U.S. downstream results, which include revenue from refining and marketing, fell more than 70%. Work on a refinery in Miss. and a fire at a refinery in Richmond, Calif., hit results. Shares rose 1.3% to 120.04.


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Canon raises profit outlook as weak yen swells earnings

TOKYO (Reuters) – Canon Inc raised its full-year operating profit forecast by $ 300 million as a weakening yen triggered by Japan’s latest deflation-fighting policies inflates its overseas earnings, despite smartphones sapping compact camera sales.

For the business year to December 31 2013, the company, which relies on foreign markets for four-fifths of sales, lifted its operating profit forecast to 450 billion yen ($ 4.53 billion)from 410 billion yen. That compares with the average expectation of a 473 billion yen profit among 21 analysts surveyed by Thomson Reuters.

As one of the first blue-chip Japanese corporations to report quarterly results, results from Canon, which is considered a leader in profitability in corporate Japan with its aggressive cost-cutting and high degree of factory automation, is often seen as a barometer for tech sector earnings.

“We welcome Abenomics,” Chief Financial Officer Toshizo Tanaka said at a news briefing, acknowledging the impact of Prime Minister Shinzo Abe’s economic policies.

“The Japanese economy moves on this kind of mood so we value this and hope to find success,” he added.

His company raised its forecast for the yen rate against the dollar to 95 yen for the business year compared with 85 yen to the dollar three months earlier.

Abe’s government says the yen’s rapid weakening is a by-product of its economic policies and not the goal. Still, the depreciation is what business leaders worried about their ability to compete, particularly against South Korean firms, have been urging.

Fabricating goods worth around 38 trillion yen a year, Japanese makers of TVs, mobile phones, printers and personal computers account for a sizeable chunk of Japan’s $ 5 trillion economy. The tech sector directly employs around 2 million workers in Japan, making it an influential lobby.

Canon’s operating profit in the first quarter dipped 34 percent to $ 552 million, which the company blamed on a weakened global economy, and picture-taking consumers eschewing compact cameras in favor of smartphones.

WELCOME WEAKNESS

Corporate heads who have praised Abenomics include Sony Corp CEO Kazuo Hirai. His company and other Japanese TV makers, Panasonic Corp and Sharp Corp struggled to fend off competition from Samsung Electronics as a strong yen bit into profits.

Sony with its bigger exposure to overseas markets stands to gain the most from a weaker yen, particularly versus the euro. A 1 yen change against the European single currency adds about 6 billion yen to operating profit at the maker of Bravia sets.

At Panasonic a 1 yen weakening against the euro moves the currency by 2 billion yen, and by 2.5 billion yen for changes against the dollar. At Sharp, which more heavily relies on its home market, a 1 yen move against the euro is worth around 500 million yen in operating profit and 700 million yen against the dollar.

More than a third of companies remain worried about domestic demand stagnating, a Reuters survey of 240 companies released on Friday shows. A quarter said they were likely to increase output in Japan because of the weaker yen.

Since mid-November when an Abenomics stock rally began, Canon’s shares, have gained 58 percent in line with a 60 percent gain in the Nikkei 225 benchmark index. Its stock rose 1.3 percent in Tokyo to 3,840 yen on Wednesday. Quarterly results were released after the close of trading.

(Reporting by Tim Kelly and Mari Saito; Editing by Daniel Magnowski)


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Canon raises profit outlook as weak yen swells earnings

TOKYO (Reuters) – Canon Inc raised its full-year operating profit forecast by $ 300 million as a weakening yen triggered by Japan’s latest deflation-fighting policies inflates its overseas earnings, despite smartphones sapping compact camera sales.

For the business year to December 31 2013, the company, which relies on foreign markets for four-fifths of sales, lifted its operating profit forecast to 450 billion yen ($ 4.53 billion)from 410 billion yen. That compares with the average expectation of a 473 billion yen profit among 21 analysts surveyed by Thomson Reuters.

As one of the first blue-chip Japanese corporations to report quarterly results, results from Canon, which is considered a leader in profitability in corporate Japan with its aggressive cost-cutting and high degree of factory automation, is often seen as a barometer for tech sector earnings.

“We welcome Abenomics,” Chief Financial Officer Toshizo Tanaka said at a news briefing, acknowledging the impact of Prime Minister Shinzo Abe’s economic policies.

“The Japanese economy moves on this kind of mood so we value this and hope to find success,” he added.

His company raised its forecast for the yen rate against the dollar to 95 yen for the business year compared with 85 yen to the dollar three months earlier.

Abe’s government says the yen’s rapid weakening is a by-product of its economic policies and not the goal. Still, the depreciation is what business leaders worried about their ability to compete, particularly against South Korean firms, have been urging.

Fabricating goods worth around 38 trillion yen a year, Japanese makers of TVs, mobile phones, printers and personal computers account for a sizeable chunk of Japan’s $ 5 trillion economy. The tech sector directly employs around 2 million workers in Japan, making it an influential lobby.

Canon’s operating profit in the first quarter dipped 34 percent to $ 552 million, which the company blamed on a weakened global economy, and picture-taking consumers eschewing compact cameras in favor of smartphones.

WELCOME WEAKNESS

Corporate heads who have praised Abenomics include Sony Corp CEO Kazuo Hirai. His company and other Japanese TV makers, Panasonic Corp and Sharp Corp struggled to fend off competition from Samsung Electronics as a strong yen bit into profits.

Sony with its bigger exposure to overseas markets stands to gain the most from a weaker yen, particularly versus the euro. A 1 yen change against the European single currency adds about 6 billion yen to operating profit at the maker of Bravia sets.

At Panasonic a 1 yen weakening against the euro moves the currency by 2 billion yen, and by 2.5 billion yen for changes against the dollar. At Sharp, which more heavily relies on its home market, a 1 yen move against the euro is worth around 500 million yen in operating profit and 700 million yen against the dollar.

More than a third of companies remain worried about domestic demand stagnating, a Reuters survey of 240 companies released on Friday shows. A quarter said they were likely to increase output in Japan because of the weaker yen.

Since mid-November when an Abenomics stock rally began, Canon’s shares, have gained 58 percent in line with a 60 percent gain in the Nikkei 225 benchmark index. Its stock rose 1.3 percent in Tokyo to 3,840 yen on Wednesday. Quarterly results were released after the close of trading.

(Reporting by Tim Kelly and Mari Saito; Editing by Daniel Magnowski)


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Health Mgmt expects weak 1Q results, cuts outlook

NAPLES, Fla. (AP) — Hospital operator Health Management Associates Inc. forecast disappointing first-quarter results on Tuesday and lowered its outlook for the full year, saying admissions didn’t live up to its expectations and a variety of factors are making it harder for patients to pay their bills.

The company said inpatient admissions were lower than expected and admissions for observation climbed compared to a year ago. Health Management Associates is also setting aside more money to cover bills that may go unpaid.

Its stock declined $ 1.45, or 11.5 percent, to $ 11.14 in after-hours trading.

Health Management Associates runs 71 hospitals in non-urban areas. Most of its locations are in the Southeast. The company said that compared to last year, more patients were unable to pay their deductibles and copays because of greater health insurance premiums, shifts to insurance plans with larger deductibles, increases in deductibles and copays, and greater payroll taxes and gas prices.

The company said it expects to report income of 12 to 13 cents per share in the first quarter, excluding one-time items. It projects about $ 1.48 billion in revenue.

Analysts had called for net income of 23 cents per share and $ 1.55 billion in revenue, according to FactSet. The company reported $ 1.49 billion in revenue in the first quarter of 2012.

The company said it expects to set aside about 14 percent of its first-quarter net revenue to cover bills that may not be paid. That’s up from about 12 percent in the year-ago quarter. It said emergency room volumes and uninsured outpatient procedures increased. The situation was particularly bad at hospitals Health Management Associates recently acquired.

Health Management Associates said adjusted admissions at hospitals open at least a fell about 5.7 percent because of reduced inpatient admissions and increased stays for observation. Observation stays that lasted two days or longer climbed at least 40 percent. The company said one of the biggest reasons for the growth in observation stays was an increase in Medicare and Medicaid Advantage business, especially in Florida.

Admissions at hospitals open at least a year are considered an important measurement of the company’s performance. The measurement excludes results from locations that opened, closed, or were sold or acquired within the last year.

Adjusted admissions includes both inpatient admissions and outpatient procedures.

Health Management Associates is now forecasting full-year net income of 86 to 95 cents per share from continuing operations on revenue of $ 6.8 billion to $ 7 billion. In January the company projected net income of 86 cents to $ 1.01 per share on revenue of $ 7 billion to $ 7.2 billion.

Analysts expected net income of 88 cents per share on $ 6.13 billion in revenue on average.

Health Management Associates says admissions at hospitals open at least a year will be unchanged from last year at best and could fall as much as 3 percent at worst. Previously the company said those admissions could rise as much as 1 percent or fall as much as 1 percent.

Shares of Health Management Associates lost 5 cent to $ 12.59 during regular trading Tuesday. The stock has been strong in recent months, and on April 2, the shares reached a six-year high of $ 13.63.


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Synnex falls as co. gives weak 2Q profit forecast

NEW YORK (AP) — Shares of Synnex declined in afternoon trading on Thursday as the high-tech contractor forecast fiscal second-quarter earnings below Wall Street’s expectations.

THE SPARK: Synnex Corp. said late Wednesday it expects second-quarter earnings in a range of 78 cents to 82 cents per share on revenue between approximately $ 2.43 billion and $ 2.53 billion. Analysts polled by FactSet expect earnings of 92 cents per share on revenue of $ 2.5 billion.

The company also reported first-quarter earnings of 88 cents per share on revenue of $ 2.46 billion. Wall Street forecast earnings of 88 cents per share on revenue of $ 2.44 billion.

THE ANALYSIS: Matthew Sheerin of Stifel Nicolaus said in a client note that Synnex’s second-quarter earnings guidance came in below estimates due to increased pricing pressure and softer demand for larger-volume products like printers and notebook/desktop personal computers. The analyst said the company is also dealing with weakening demand in Canada, which makes up about 15 percent of its sales.

Sheerin reaffirmed a “Hold” rating.

Brean Capital’s Ananda Baruah continues to like Synnex despite the soft second-quarter earnings outlook. The analyst said that Synnex plans to defend share in the high-volume print and PC categories, with history showing that competitive pricing pressure in these areas is typically short lived.

Baruah said the company’s balance sheet is still solid and views it as an attractive long-term opportunity. The analyst maintained a “Buy” rating and increased Synnex’s price target to $ 43 from $ 40.

Synnex CEO Kevin Murai said during a conference call on Wednesday that the company is optimistic about its competitive position and business strategy and believes it is well positioned to grow sales and profitability over the long term.

SHARE ACTION: Synnex Corp.’s stock fell $ 4.08, or 10 percent, to $ 36.80. The shares have traded in a 52-week range of $ 30.70 to $ 41.22. For the year to date, the shares are up about 19 percent.


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