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Westpac lifts cash earnings
SYDNEY, Australia (Reuters) -- Westpac Banking Corp has topped market forecasts after strong business lending and buoyant home loans drove second-half profits higher. But uncertainty about the year ahead has unnerved some investors, with the stock ending just in the red Thursday. Westpac said full-year cash net profit climbed 10 percent from a year ago to Aust. $2.271 billion ($1.59 billion). Cash earnings per share were up nine percent, at the high end of Westpac's forecast for seven-to-nine percent growth. This compares with rival ANZ Banking Group's 8.3 percent rise in full-year net profit to A$2.348 billion posted last week. Westpac will slip to be Australia's fourth-largest bank later this year when ANZ completes its $3.47 billion acquisition of National Bank of New Zealand. The two are well behind market leader National Australia Bank, and second-placed Commonwealth Bank of Australia. Westpac's second-half cash earnings before one-offs rose 15 percent, at the high end of expectations and ahead of competitors, as lending in a buoyant property market remained at record levels. Cash net profit -- earnings before one-offs after adding back amortisation of goodwill, less dividends paid on hybrid equity -- rose to A$1.176 billion ($822 million) in the six months ended September 30 from A$1.021 billion in the year-earlier period. This was slightly above the consensus analyst forecast of A$1.159 billion. Net profit for the half year slipped to A$1.132 billion, down 3.5 percent on the year-ago period, which included A$181 million in special gains from asset sales. Analysts had forecast A$1.129 billion. "Our outlook for continued earnings growth in 2004 remains positive," Chief Executive David Morgan told reporters. "Westpac has put in the best performance (of major banks). I think people will probably be wanting to get a bit more confidence that is going to continue," said Shawn Burns, portfolio manager at Deutsche Asset Management. Westpac shares, which have gained 18 percent so far this year, ended 0.06 percent lower at A$16.28 in a slightly higher overall market. Other big banks firmed. Copyright 2003 Reuters. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
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