Goldman turns in lower net in Q2
Source: Bloomberg News |
July 20, 2011, Wednesday
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Print Edition
Print Edition
Goldman Sachs Group Inc, the No. 5 United States bank by assets, said second-quarter profit fell short of analysts' estimates as fixed-income trading revenue dipped more than analysts estimated.
Net income climbed 77 percent to US$1.09 billion, or US$1.85 per share, from US$613 million, or 78 cents, in the same period a year earlier, the New York-based company said yesterday in a statement. That compares with the US$2.30 per share average estimate of 23 analysts surveyed by Bloomberg news. Earnings fell 38 percent if one-time costs are excluded from the 2010 results.
Under Chairman and Chief Executive Officer Lloyd C. Blankfein, 56, Goldman Sachs in the past five years has had its only loss as a publicly traded company, in the fourth quarter of 2008, and record earnings in 2009, when trading accounted for 72 percent of revenue. JPMorgan Chase & Co's investment bank last week reported a smaller-than-expected 17 percent decline in overall trading revenue from the first quarter, while the same business at Citigroup Inc dropped 21 percent.
Goldman Sachs is "a trading-revenue firm more than anything and last quarter was weak," Matthew D. McCormick, a portfolio manager at Bahl & Gaynor Inc who helps manage about US$4 billion, said before the results were released. "If they can't make it on trading revenues, where else are they going to go?"
Last year's second-quarter earnings were cut by a US$550 million deal with the Securities and Exchange Commission and a US$600 million expense to pay a UK tax on employee bonuses.
Net income climbed 77 percent to US$1.09 billion, or US$1.85 per share, from US$613 million, or 78 cents, in the same period a year earlier, the New York-based company said yesterday in a statement. That compares with the US$2.30 per share average estimate of 23 analysts surveyed by Bloomberg news. Earnings fell 38 percent if one-time costs are excluded from the 2010 results.
Under Chairman and Chief Executive Officer Lloyd C. Blankfein, 56, Goldman Sachs in the past five years has had its only loss as a publicly traded company, in the fourth quarter of 2008, and record earnings in 2009, when trading accounted for 72 percent of revenue. JPMorgan Chase & Co's investment bank last week reported a smaller-than-expected 17 percent decline in overall trading revenue from the first quarter, while the same business at Citigroup Inc dropped 21 percent.
Goldman Sachs is "a trading-revenue firm more than anything and last quarter was weak," Matthew D. McCormick, a portfolio manager at Bahl & Gaynor Inc who helps manage about US$4 billion, said before the results were released. "If they can't make it on trading revenues, where else are they going to go?"
Last year's second-quarter earnings were cut by a US$550 million deal with the Securities and Exchange Commission and a US$600 million expense to pay a UK tax on employee bonuses.
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