American Express Co., which specializes in travel services and credit cards, on Monday reported fourth quarter earnings that were down from year-earlier results that included profits from a financial planning unit it no longer owns.
Excluding the unit, which now operates independently as Ameriprise Financial Inc., results in the October-December period were up 12.2 percent from a year earlier, boosted in part by higher spending on the company's cards.
New York-based American Express said net income totaled $745 million, or 59 cents a share, in the fourth quarter, down about 17 percent from the year-earlier profits of $896 million, or 71 cents a share.
Excluding the spin-off costs for Ameriprise and related businesses, fourth-quarter earnings were $751 million, or 60 cents a share, up from $669 million, or 53 cents a share, a year earlier.
Revenues were $6.44 billion in the fourth quarter, a 9 percent increase over the $5.9 billion reported a year earlier.
Analysts surveyed by Thomson Financial had projected earnings of 59 cents a share of income of $6.84 billion.
While a number of financial institutions took a hit to earnings because of the spike in bankruptcy filings ahead of the Oct. 17 change in the nation's bankruptcy law, American Express was less affected because many of its customers have high incomes and are less likely to file for bankruptcy.
Kenneth I. Chenault, chairman and chief executive, said in a statement accompanying the report that "higher spending by affluent consumers, small businesses and corporate card members more than offset the impact of an industrywide spike in bankruptcy filings."
He said that aggressive marketing helped add 2 million new cards in the fourth quarter and that spending grew 15 percent.
Chenault noted the card company's 2005 deals with major U.S. financial institutions, including Citibank in New York and Bank of America in Charlotte, N.C., and added: "All in all, American Express is entering 2006 in excellent competitive position."
For the full year, net income totaled $3.73 billion, or $2.97 a share, up 8.4 percent from $3.45 billion, or $2.68 a share, in 2004. Profits from continuing operations were $3.22 billion, or $2.56 per share, for all of 2005, up from $2.69 billion, or $2.09 a share, in 2004.
Revenue for the year was $24.27 billion, up 10.5 percent from $21.96 billion in 2004.