DEAN WITTER, DISCOVER & CO. THIRD QUARTER EARNINGS UP 19%; NINE-MONTH EARNINGS REACH A RECORD $678.3 MILLION.NEW YORK--(BUSINESS WIRE)--Oct.24--Dean Witter witter Verb Chiefly Brit informal to chatter or babble pointlessly or at unnecessary length [origin unknown] witter verb chatter, chat, rabbit (on) , Discover & Co. today reported third quarter net income of $218.7 million, up 19 percent from $184.5 million for the third quarter of 1994. Earnings per share increased to $1.23 on a fully diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. basis from $1.06 in the third quarter of last year. The quarter's net operating revenues operating revenue Revenue from any regular source. Revenue from sales is adjusted for discounts and returns when calculating operating revenue. Compare other revenue. were $1.45 billion, a 17 percent advance over last year's $1.24 billion. The trailing twelve-month return on equity was 18.7%. Securities earnings climbed 42 percent to a record $106.7 million in the third quarter from $74.9 million a year ago, and Credit Services earnings increased 2 percent to $112.0 million from last year's $109.6 million. "We are very pleased with the results in both of our major businesses," said Philip J. Purcell Philip J. Purcell headed Sears' 1981 acquisition of Dean Witter, helping to create the Discover Card. After Morgan Stanley merged with Dean Witter Reynolds in 1997, Purcell replaced Morgan Stanley's John J. Mack as CEO. , Chairman and Chief Executive Officer. "We've realized the benefits of being a full-service securities firm in strong financial markets and we continued to do a good job in controlling costs. In Credit Services, we began to see results from our multi-card strategy. We've added accounts, built receivables Receivables An asset designation applicable to all debts, unsettled transactions or other monetary obligations owed to a company by its debtors or customers. Receivables are recorded by a company's accountants and reported on the balance sheet, and they and include all debts owed and increased our revenues." Net income for the first nine months of the year reached a record $678.3 million, up 13 percent from $600.9 million for the same period of 1994. Earnings per share rose to $3.83 on a fully diluted basis compared to last year's $3.46. Year-to-date net operating revenues increased 13 percent over last year to $4.24 billion. CREDIT SERVICES Business growth was strong during the third quarter. Managed loans increased by $5.5 billion or 24 percent over third quarter end last year to a record $28.2 billion. Merchant and Cardmember fees increased 22 percent, on a managed loan basis, from last year's third quarter. Net interest income rose 23 percent over third quarter 1994 primarily on higher loan portfolio balances. The provision for loan losses rose 42 percent primarily as a result of the growth in managed loans and higher charge-offs. Third quarter net operating revenues rose to a record $676.6 million, an increase of 15 percent from 1994's third quarter. Operating expenses Operating expenses The amount paid for asset maintenance or the cost of doing business, excluding depreciation. Earnings are distributed after operating expenses are deducted. increased 21 percent to $497.7 million from the third quarter of last year. Dean Witter Dean Witter may refer to:
SECURITIES Third quarter commission revenues, fueled by continuing strong investor interest in equities, climbed 28 percent from the same period a year ago to $266.2 million. Principal transactions advanced 15 percent from last year's third quarter to $121.6 million, driven by higher over-the-counter equity activity. Investment banking revenues increased 39 percent to $45.1 million as equity underwriting Underwriting 1. The process by which investment bankers raise investment capital from investors on behalf of corporations and governments that are issuing securities (both equity and debt). 2. The process of issuing insurance policies. activity expanded. Net credit income increased $23.1 million over the third quarter of 1994 to $74.6 million. Net operating revenues increased 18 percent from the third quarter of last year to a record $774.6 million. Operating expenses were up 13 percent over 1994's third quarter to $597.8 million. The profit margin in the Securities business increased to a record 13.8 percent. Total client assets reached an all-time high of $213.2 billion, an increase of $8.7 billion for the quarter and $32.8 billion year-to-date. Assets under management Assets Under Management (AUM) is a term used by financial services companies in the mutual fund and money management or investment management business to gauge how much money they are managing. and administration increased to a record $76.4 billion at quarter-end, up $3.1 billion for the quarter and $9.5 billion for the first nine months of the year. The number of account executives increased by 179 for the quarter, and by 355 from the end of last year's third quarter, to an all-time high of 8,233. CONTACT: Timothy Lee Corporate Communications Corporate communications is the process of facilitating information and knowledge exchanges with internal and key external groups and individuals that have a direct relationship with an enterprise. (212) 392-8709 or Amy A. Pappas Investor Relations Investor relations The process by which the corporation communicates with its investors. (212) 392-6171 |
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