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American Express Reports First Quarter EPS of $1.15, up 7% from a Year Ago; Revenues and Cardmember Spending Rise, Credit

  American Express Reports First Quarter EPS of $1.15, up 7% from a Year Ago;
  Revenues and Cardmember Spending Rise, Credit Quality Remains Excellent

Business Wire

NEW YORK -- April 17, 2013

American Express Company (NYSE: AXP) today reported first-quarter net income
of $1.3 billion, up 2 percent from a year ago. Diluted earnings per share was
$1.15, up 7 percent from $1.07 a year ago.

                                                               
(Millions, except per share amounts)
                                                                    
                                            Quarters Ended          Percentage

                                            March 31,               Inc/(Dec)
                                              2013       2012
Total Revenues Net of Interest              $ 7,881     $ 7,587     4    %
Expense
Net Income                                  $ 1,280     $ 1,256     2    %
Earnings Per Common Share – Diluted
Net Income Attributable to Common           $ 1.15      $ 1.07      7    %
Shareholders^1
Average Diluted Common Shares                 1,106       1,166     (5   ) %
Outstanding
Return on Average Equity                      23.2  %     27.1  %
                                                                    

Consolidated total revenues net of interest expense were $7.9 billion, up 4
percent from $7.6 billion a year ago. The increase reflected strong cardmember
spending as well as higher net interest income and annual cardmember fees.

Adjusted for foreign currency translations, total revenues net of interest
expense rose 5 percent from a year ago.^2

Consolidated provisions for losses totaled $497 million, up 21 percent from
$412 million a year ago. The increase reflected a larger lending reserve
release a year ago, partially offset by lower net write-offs in the current
quarter. Credit indicators continued to be at historically strong levels.

Consolidated expenses totaled $5.5 billion, up 1 percent from $5.4 billion a
year ago. The slight increase from a year ago reflects continued investments
in the business along with ongoing efforts to contain operating expenses.^3
Adjusted for foreign currency translations, consolidated total expenses rose 2
percent from a year ago.^2

The effective tax rate was 33 percent, up from 29 percent a year ago,
reflecting the realization of certain foreign tax credits last year.

The company's return on average equity (ROE) was 23.2 percent, down from 27.1
percent a year ago.

“We are off to a strong start in 2013, thanks to our ability to grow revenue
in a slow growth economy, control expenses and maintain a strong balance
sheet,” said Kenneth I. Chenault, chairman and chief executive officer.
“Cardmember spending grew 6 percent (7 percent adjusted for foreign currency
translations) and we saw a modest increase in loans outstanding. Revenue from
annual cardmember fees was also up from a year ago, reflecting the value our
customers see in their relationship with American Express. Credit indicators
continued to be excellent.

“We made good headway throughout the business and continue to see very
encouraging customer response to initiatives like our reloadable prepaid
products and loyalty marketing initiatives that are expanding our footprint
into newer segments of the market.

“Progress on cost control initiatives allowed us to continue to make
investments to grow the business, while holding operating expenses well within
our target of less than 3 percent annual growth for the next two years.A lean
operating structure is a critical advantage for any business, and the
flexibility it gives us to allocate resources toward growth initiatives keeps
us in a good position to deliver results for our shareholders.

“Capital strength is also a critical advantage in uncertain times, and the
advantages of our spend-centric business model were again underscored by
results of the Federal Reserve’s annual stress test. Our performance was among
the best in the hypothetical severe stress scenario and as a result, we plan
to increase our dividend to 23 cents per share next quarter, a 15 percent
increase for shareholders. We are also moving ahead with plans to repurchase
common shares that would return up to $3.2 billion to shareholders during the
remainder of this year and up to an additional $1.0 billion in the first
quarter of 2014.”

Segment Results

U.S. Card Services reported first-quarter net income of $804 million, up 7
percent from $752 million a year ago.

Total revenues net of interest expense increased 5 percent to $4.1 billion
from $3.9 billion a year ago. The increase was driven by an 8 percent increase
in cardmember spending and higher net interest income.

Provisions for losses totaled $338 million, up 12 percent from $301 million a
year ago. The increase primarily reflected a larger lending reserve release a
year ago, partially offset by lower net write-offs in the current quarter.

Total expenses increased 3 percent to $2.5 billion from $2.4 billion a year
ago. Marketing, promotion, rewards and cardmember services expenses increased
5 percent from a year ago. Salaries and employee benefits and other operating
expenses were unchanged from a year ago.

The effective tax rate was 37 percent compared to 36 percent a year ago.

International Card Services reported first-quarter net income of $178 million,
down 10 percent from $197 million a year ago.

Total revenues net of interest expense were $1.3 billion, up 1 percent from a
year ago, reflecting higher cardmember spending and growth in annual
cardmember fees. Adjusted for foreign currency translations, revenues net of
interest expense rose 4 percent from a year ago.^2

Provisions for losses totaled $95 million, up 76 percent from $54 million a
year ago. The increase primarily reflected larger reserve releases a year ago.

Total expenses were $1.0 billion, down 2 percent from a year ago. Adjusted for
foreign currency translations, expenses rose 1 percent from a year ago.^2

The effective tax rate was 8 percent compared to (1) percent a year ago,
reflecting the realization of certain foreign tax credits last year.

Global Commercial Services reported first-quarter net income of $191 million,
up 8 percent from $177 million a year ago.

Total revenues net of interest expense were $1.2 billion, up 1 percent from a
year ago, reflecting increased spending by corporate cardmembers, partially
offset by lower travel commissions and fees. Foreign currency translations did
not result in a material change to revenues this quarter.

Total expenses decreased 4 percent to $843 million from $878 million a year
ago. The decline primarily reflected lower salaries and employee benefits and
other operating expenses. Adjusted for foreign currency translations, expenses
decreased 3 percent from a year ago.^2

The effective tax rate was 33 percent compared to 27 percent a year ago,
reflecting the realization of certain foreign tax credits last year.

Global Network & Merchant Services reported first quarter net income of $373
million, up 4 percent from $357 million a year ago.

Total revenues net of interest expense increased 4 percent to $1.3 billion
from $1.2 billion a year ago. The increase reflected higher merchant-related
revenues driven by global cardmember spending, as well as an increase in
revenues from Global Network Services’ bank partners. Adjusted for foreign
currency translations, revenues net of interest expense rose 6 percent from a
year ago.^2

Total expenses increased 1 percent to $701 million from $691 million a year
ago. Adjusted for foreign currency translations, expenses rose 2 percent from
a year ago.^2

The effective tax rate was 36 percent, compared to 34 percent a year ago.

Corporate and Other reported first-quarter net loss of $266 million compared
with net loss of $227 million a year ago.

About American Express

American Express is a global services company, providing customers with access
to products, insights and experiences that enrich lives and build business
success.Learn more at americanexpress.com and connect with us on
facebook.com/americanexpress, foursquare.com/americanexpress,
linkedin.com/companies/american-express, twitter.com/americanexpress, and
youtube.com/americanexpress.

Key links to products and services: charge and credit cards, business credit
cards, travel services, gift cards, prepaid cards, merchant services, business
travel, and corporate card.

The 2013 First Quarter Earnings Supplement will be available today on the
American Express web site at http://ir.americanexpress.com. An investor
conference call will be held at 5:00 p.m. (ET) today to discuss first-quarter
earnings results. Live audio and presentation slides for the investor
conference call will be available to the general public at the same web site.
A replay of the conference call will be available later today at the same web
site address.

This release includes forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995. These statements are based
on the company's expected business and financial performance and are subject
to risks and uncertainties. Actual results may differ from those set forth in
the forward-looking statements due to a variety of factors, including those
contained in the company's Annual Report on Form 10-K for the year ended
December 31, 2012, and the company’s other filings with the Securities and
Exchange Commission. Readers are cautioned not to place undue reliance on
these forward-looking statements, which speak only as of the date on which
they are made. The company undertakes no obligation to update or revise any
forward-looking statements.

^1 Represents net income, less earnings allocated to participating share
awards of $11 million and $14 million for the three months ended March 31,
2013 and 2012, respectively.

^2 As reported in this release, FX adjusted information, which constitute
non-GAAP financial measures, assumes a constant exchange rate between the
periods being compared for purposes of currency translation into U.S. dollars
(i.e., assumes the foreign exchange rates used to determine results for the
three months ended March 31, 2013 apply to the period(s) against which such
results are being compared). The company believes the presentation of
information on an F/X adjusted basis is helpful to investors by making it
easier to compare the company’s performance in one period to that of another
period without the variability caused by fluctuations in currency exchange
rates.

^3 Operating expenses represent salaries and employee benefits, professional
services, occupancy and equipment, communications and other expenses

All information in the following tables is presented on a basis prepared in
accordance with U.S. generally accepted accounting principles (GAAP), unless
otherwise indicated. Certain reclassifications of prior period amounts have
been made to conform to the current period presentation.

                                                              
(Preliminary)
American Express Company
Consolidated Statements of Income
                                                                    
(Millions)
                                            Quarters Ended
                                            March 31,               Percentage
                                             2013      2012     Inc/(Dec)
                                                                    
Revenues
Non-interest revenues
Discount revenue                            $ 4,438     $ 4,257     4      %
Net card fees                                 653         610       7
Travel commissions and fees                   437         451       (3     )
Other commissions and fees                    573         583       (2     )
Other                                        537       553      (3     )
Total non-interest revenues                  6,638     6,454    3
Interest income
Interest on loans                             1,683       1,611     4
Interest and dividends on investment          53          66        (20    )
securities
Deposits with banks and other                26        30       (13    )
Total interest income                        1,762     1,707    3
Interest expense
Deposits                                      114         129       (12    )
Long-term debt and other                     405       445      (9     )
Total interest expense                       519       574      (10    )
Net interest income                          1,243     1,133    10
Total revenues net of interest               7,881     7,587    4
expense
Provisions for losses
Charge card                                   195         178       10
Cardmember loans                              275         212       30
Other                                        27        22       23
Total provisions for losses                  497       412      21
Total revenues net of interest               7,384     7,175    3
expense after provisions for losses
                                                                    
Expenses
Marketing and promotion                       621         631       (2     )
Cardmember rewards                            1,520       1,467     4
Cardmember services                           189         194       (3     )
Salaries and employee benefits                1,615       1,635     (1     )
Professional services                         716         691       4
Occupancy and equipment                       472         438       8
Communications                                96          96        -
Other, net                                   246       250      (2     )
Total                                        5,475     5,402    1
Pretax income                                 1,909       1,773     8
Income tax provision                         629       517      22
Net income                                  $ 1,280    $ 1,256    2
Net income attributable to common           $ 1,269    $ 1,242    2
shareholders (A)
Effective tax rate                            32.9  %     29.2  %
                                                                    

      Represents net income, less earnings allocated to participating share
(A)  awards of $11 million and $14 million for the three months ended March
      31, 2013 and 2012, respectively.

                                                        
(Preliminary)
American Express Company
Condensed Consolidated Balance Sheets
                                                             
(Billions)
                                                             
                                                 March 31,   December 31,
                                                    2013        2012
                                                             
Assets
Cash & cash equivalents                          $   28      $    22
Accounts receivable                                  46           46
Investment securities                                6            6
Loans                                                61           64
Other assets                                        16          15
Total assets                                     $   157     $    153
                                                             
Liabilities and Shareholders' Equity
Customer deposits                                $   41      $    40
Short-term borrowings                                3            3
Long-term debt                                       56           59
Other liabilities                                   38          32
Total liabilities                                   138         134
                                                             
Shareholders' Equity                                19          19
Total liabilities and shareholders' equity       $   157     $    153
                                                             

                                                              
                                                                    
(Preliminary)
American Express Company
Financial Summary
                                                                    
(Millions)
                                            Quarters Ended
                                            March 31,               Percentage
                                             2013      2012     Inc/(Dec)
                                                                    
Total revenues net of interest
expense
U.S. Card Services                          $ 4,082     $ 3,884     5      %
International Card Services                   1,317       1,299     1
Global Commercial Services                    1,163       1,157     1
Global Network & Merchant Services           1,303     1,248    4
                                              7,865       7,588     4
Corporate & Other                            16        (1    )   #
                                                                    
CONSOLIDATED TOTAL REVENUES NET OF          $ 7,881    $ 7,587    4
INTEREST EXPENSE
                                                                    
Pretax income (loss)
U.S. Card Services                          $ 1,270     $ 1,180     8
International Card Services                   193         196       (2     )
Global Commercial Services                    283         244       16
Global Network & Merchant Services           582       539      8
                                              2,328       2,159     8
Corporate & Other                            (419  )    (386  )   9
                                                                    
PRETAX INCOME                               $ 1,909    $ 1,773    8
                                                                    
Net income (loss)
U.S. Card Services                          $ 804       $ 752       7
International Card Services                   178         197       (10    )
Global Commercial Services                    191         177       8
Global Network & Merchant Services           373       357      4
                                              1,546       1,483     4
Corporate & Other                            (266  )    (227  )   17
                                                                    
NET INCOME                                  $ 1,280    $ 1,256    2
                                                                    

# - Denotes a variance of more than 100%.

                                                              
(Preliminary)
American Express Company
Financial Summary (continued)
                                                                    
                                                                    
                                            Quarters Ended
                                            March 31,               Percentage
                                             2013      2012     Inc/(Dec)
EARNINGS PER COMMON SHARE
                                                                    
BASIC
Net income attributable to common           $ 1.15     $ 1.07     7     %
shareholders
                                                                    
Average common shares outstanding            1,099     1,160    (5    )%
(millions)
                                                                    
DILUTED
Net income attributable to common           $ 1.15     $ 1.07     7     %
shareholders
                                                                    
Average common shares outstanding            1,106     1,166    (5    )%
(millions)
                                                                    
Cash dividends declared per common          $ 0.20     $ 0.20     -     %
share
                                                                    
                                                                    
Selected Statistical Information
                                                                    
                                            Quarters Ended
                                            March 31,               Percentage
                                             2013      2012     Inc/(Dec)
                                                                    
Return on average equity (A)                  23.2  %     27.1  %
Return on average common equity (A)           23.0  %     26.8  %
Return on average tangible common             29.3  %     35.0  %
equity (A)
Common shares outstanding (millions)          1,098       1,166     (6    )%
Book value per common share                 $ 17.56     $ 17.08     3     %
Shareholders' equity (billions)             $ 19.3      $ 19.9      (3    )%
                                                                    

      Refer to Appendix I for components of return on average equity, return
(A)  on average common equity and return on average tangible common equity, a
      non-GAAP measure.

                                                                 
(Preliminary)
American Express Company
Components of Return on Average Equity (ROE), Return on Average Common Equity
(ROCE),
and Return on Average Tangible Common Equity (ROTCE)
Appendix I
                                                                         
(Millions)
                     For the Twelve Months Ended
                     March 31,    December     September    June 30,     March 31,
                                  31,          30,
                      2013       2012       2012       2012       2012   
                                                                         
ROE
                                                                         
Net income           $ 4,506      $ 4,482      $ 5,037      $ 5,022      $ 5,014
Average
shareholders'        $ 19,426     $ 19,425     $ 19,145     $ 18,887     $ 18,525
equity
Return on
average equity         23.2   %     23.1   %     26.3   %     26.6   %     27.1   %
(A)
                                                                         
Reconciliation
of ROCE and
ROTCE
                                                                         
Net income           $ 4,506      $ 4,482      $ 5,037      $ 5,022      $ 5,014
Earnings
allocated to
participating         46         49         56         57         58     
share awards
and other
Net income
attributable         $ 4,460     $ 4,433     $ 4,981     $ 4,965     $ 4,956  
to common
shareholders
                                                                         
Average
shareholders'        $ 19,426    $ 19,425    $ 19,145    $ 18,887    $ 18,525 
equity
Average common
shareholders'        $ 19,426    $ 19,425    $ 19,145    $ 18,887    $ 18,525 
equity
Average
goodwill and          4,181      4,232      4,272      4,330      4,380  
other
intangibles
Average
tangible
common               $ 15,245    $ 15,193    $ 14,873    $ 14,557    $ 14,145 
shareholders'
equity
Return on
average common         23.0   %     22.8   %     26.0   %     26.3   %     26.8   %
equity (A)
Return on
average
tangible               29.3   %     29.2   %     33.5   %     34.1   %     35.0   %
common equity
(B)
                                                                         

      Return on average equity and return on average common equity are
(A)  calculated by dividing one year period net income/net income
      attributable to common shareholders by one year average total
      shareholders’ equity/average common shareholders' equity, respectively.
      
      Return on average tangible common equity, a non-GAAP measure, is
      computed in the same manner as return on average common equity except
      the computation of average tangible common shareholders' equity, a
(B)   non-GAAP measure, excludes from average total shareholders' equity,
      average goodwill and other intangibles. The Company believes that return
      on average tangible common equity is a useful measure of the
      profitability of its business.

Contact:

American Express Company
Media:
Marina H. Norville, +1-212-640-2832
marina.h.norville@aexp.com
or
Mike O'Neill, +1-212-640-5951
mike.o'neill@aexp.com
or
Investors/Analysts:
Ken Paukowits, +1-212-640-6348
ken.f.paukowits@aexp.com
or
Rick Petrino, +1-212-640-5574
richard.petrino@aexp.com
 
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