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CNNfn after the bell
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June 1, 1999: 7:36 p.m. ET
American Home Products and Vestcom warn; Eclipse rises
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NEW YORK (CNNfn) - Warning! Warning! Wall Street was abuzz with earnings warnings after the bell sounded on Tuesday afternoon.
Pharmaceutical giant American Home Products Corp. (AHP) warned that its second quarter and year earnings would be lower than expected because of weaker results in the agriculture products business and the livestock segment of its animal-health business.
As a result, the Madison, N.J.-based company said, diluted earnings per share for the second quarter and 1999 are expected to be about 7 cents and 11 cents lower that analyst consensus estimates 41 cents and $1.89.
Eclipse signs deal
After-hours investing company Eclipse Trading Inc. said it had entered into separate strategic alliances with Morgan Stanley Dean Witter & Co. (MWD) and Salomon Smith Barney. Both firms are making a subscription agreement and an equity investment in Eclipse's proprietary trading system. Eclipse Trading is preparing for a summer launch.
Vestcom, Cherry warn
Vestcom International Inc. (VESC) also warned that second quarter and second half earnings are expected to be lower. The Lyndhurst, NJ-based company, which assembles, manages and distributes business critical documents, said it expected to earn 2 to 3 cents per share in the second quarter, compared with 10 cents per share in the year-ago period.
Vestcom attributed the lower earnings to higher than expected costs associated with its facilities consolidation and integration programs in the New England and Mid-Atlantic regions; excess capacity in its fulfillment and print and mail operations; and lower consolidated gross margins.
Also issuing a warned was the Cherry Corp. (CHERA). The Waukegan, Ill.-based electronics company said it expected first-quarter sales this year to about the same as last year and that its earnings per share will be about 15 cents per share lower than the 50 cents per share reported last year.
Corporate sells cleaning service
Meanwhile, Corporate Express Inc. (CEXP) said it has reached a definitive agreement to sell its cleaning and service supply subsidiary, Sofco Inc., to U.S. Foodservice (UFS). Sofco, one of the largest suppliers of janitorial and cleaning supplies in the United States, reported about $160 million in net sales for the fiscal year ending Jan. 30.
Converse beats the Street
On the earnings front, Comverse Technology Inc. (CMVT) beat Wall Street's earnings expectations. The Woodbury, N.Y.-based software company reported net income of $36.6 million or 48 cents per share, excluding one-time charges, compared with $24 million or 34 cents per share in the year ago period.
Analysts polled by First Call Corp. had expected the company to earn 45 cents per share in this most recent quarter.
The company reported $200 million in sales compared to $160 million in the year ago period.
During the first quarter the company acquired Amarex Technology and took a one-time after-tax charge of $934,000 or 1 cent per diluted share. Net income for first quarter, including the write-off for acquisition-related costs, was $35.6 million or 47 cents per diluted share.
Intimate Brands sales rise
Intimate Brands Inc. (IBI), maker of intimate apparel and parent of Victoria's Secret, reported net sales for the four-week period ending May 29 of $318 million, a 17 percent increase from $271.4 million in the year ago period. Sales for the 17 weeks ended May 29 were $1.196 billion, a 15 percent increase from sales of $1.042 billion for the same period last year.
Tickets.com to sell shares to public
And finally, Tickets.com Inc. said it plans to raise a maximum of $75 million in its first sale of common stock to the public.
--with staff and wire reports
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