|
|
|
|
|
|
|
|
|
|
|
|
|
==============================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) October 24, 1994
AMERICAN EXPRESS COMPANY
----------------------------------------------------------------
(Exact name of registrant as specified in its charter)
New York 1-7657 13-4922250
------------------------------- -------------- ------------
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification)
American Express Tower, World Financial Center
New York, New York 10285
----------------------------------------------- ---------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, (212) 640-2000
including area code --------------
-----------------------------------------------------------------
(Former name or former address, if changed since last report.)
==============================================================================
<PAGE>
Item 5. Other Events
On October 24, 1994, American Express Company issued the following
press release:
NEW YORK, October 24, 1994 - American Express Company today reported
third quarter net income of $369 million ($0.71 per share), up 18 percent
from a year ago when income from continuing operations totaled $313 million
($0.61 per share).
Travel Related Services (TRS) reported third quarter net income of $264
million, a 13 percent increase over last year's net income of $234 million.
Net revenues increased 9 percent reflecting an increase in worldwide
billed business and growth in business travel sales. The increase in
billed business resulted from higher spending per Cardmember and an
increase in the number of Cards outstanding.
Total expenses increased 8 percent, reflecting business travel
acquisitions and growth, as well as investments in certain business
initiatives. Marketing and promotion expenses for the full year are
expected to be approximately the same as a year ago.
IDS Financial Services (IDS) reported third quarter net income of $114
million, a 19 percent increase over last year's net income of $96 million.
Revenue and earnings growth benefited from an increase in fees related
to higher levels of assets under management, as well as an increase in life
insurance in force. These benefits were partially offset by lower
investment margins.
IDS reported increased sales of annuities and investment certificates,
while sales of mutual funds and life and other insurance products decreased
slightly from last year.
<PAGE>
American Express Bank (AEB) reported third quarter net income of $20
million, compared with last year's net income of $29 million.
Last year's results included a $5 million benefit from the change in
the U.S. federal income tax rate.
Results for the third quarter reflect lower revenues and higher
operating expenses, primarily reflecting spending related to systems
technology. This decline in results was partially offset by a reduction in
the provision for credit losses.
Corporate and Other reported third quarter net expenses of $29 million,
compared with net expenses of $46 million last year.
Corporate expenses for 1993 included a $5 million expense from the
change in the U.S. federal income tax rate.
* * *
American Express Company is a diversified travel and financial services
company founded in 1850. It is a world leader in charge and credit cards,
Travelers Cheques, travel, financial planning, investment products,
insurance and international banking.
<PAGE>
AMERICAN EXPRESS COMPANY
FINANCIAL SUMMARY
(Unaudited)
(dollars in millions, except per share amounts)
Three Months Ended
September 30, Percentage
1994 1993 Inc/(Dec)
---- ---- ----------
Revenues by Industry Segment (A)
Travel Related Services (B) $2,601 $2,387 9.0%
IDS Financial Services 822 816 0.8
American Express Bank (B) 163 171 (4.8)
----- -----
3,586 3,374 6.3
Corporate and Other,
including adjustments
and eliminations 18 (5) -
------ ------
CONSOLIDATED REVENUES (A) $3,604 $3,369 7.0
====== ======
Pretax Income from continuing operations
by Industry Segment
Travel Related Services (B) $364 $311 17.1%
IDS Financial Services 168 140 20.3
American Express Bank (B) 31 37 (17.1)
----- -----
563 488 15.5
Corporate and Other :
Corporate expenses (65) (72) 8.6
FDC Gain - - -
----- -----
(65) (72) 8.6
----- -----
PRETAX INCOME $498 $416 19.6
===== =====
Income from continuing operations
by Industry Segment
Travel Related Services (B) $264 $234 12.8%
IDS Financial Services 114 96 19.4
American Express Bank (B) 20 29 (30.6)
----- -----
398 359 11.1
Corporate and Other :
Corporate expenses (29) (46) 35.1
FDC Gain - - -
----- -----
(29) (46) 35.1
----- -----
Income from continuing operations 369 313 17.9
Discontinued operations (net of
income taxes) (C) - 107 -
----- -----
NET INCOME $369 $420 (12.3)
===== =====
<PAGE>
Earnings per common share:
Continuing operations $0.71 $0.61 16.4
Discontinued operations - 0.22 -
----- -----
NET INCOME PER COMMON SHARE $0.71 $0.83 (14.5)
======= =======
Cash dividends declared per common share $0.225 $0.25
======= =======
Average shares outstanding (000's) 512,579 503,623
======= =======
Nine Months Ended
September 30, Percentage
1994 1993 Inc/(Dec)
---- ---- ----------
Revenues by Industry Segment (A)
Travel Related Services (B) $7,463 $6,957 7.3%
IDS Financial Services 2,450 2,349 4.3
American Express Bank (B) 493 498 (1.0)
------ ------
10,406 9,804 6.1
Corporate and Other,
including adjustments
and eliminations 74 (29) -
------ ------
CONSOLIDATED REVENUES (A) $10,480 $9,775 7.2
====== ======
Pretax Income from continuing operations
by Industry Segment
Travel Related Services (B) $1,055 $890 18.5%
IDS Financial Services 465 379 22.8
American Express Bank (B) 94 99 (4.6)
------ ------
1,614 1,368 18.0
Corporate and Other :
Corporate expenses (198) (213) 6.8
FDC Gain - 779 -
------ ------
(198) 566 -
------ ------
PRETAX INCOME $1,416 $1,934 (26.8)
====== ======
<PAGE>
Income from continuing operations
by Industry Segment
Travel Related Services (B) $762 $676 12.7%
IDS Financial Services 314 260 20.7
American Express Bank (B) 64 68 (5.8)
------ ------
1,140 1,004 13.5
Corporate and Other :
Corporate expenses (95) (123) 22.5
FDC Gain - 433 -
------ ------
(95) 310 -
------ ------
Income from continuing operations 1,045 1,314 (20.5)
Discontinued operations (net of
income taxes) (C) 33 (235) -
------ ------
NET INCOME $1,078 $1,079 (0.1)
====== ======
Earnings per common share:
Continuing operations $2.02 $2.62 (22.9)
Discontinued operations 0.07 (0.48) -
------ ------
NET INCOME PER COMMON SHARE $2.09 $2.14 (2.3)
======= =======
Cash dividends declared per common share $0.70 $0.75
======= =======
Average shares outstanding (000's) 510,672 498,862
======= =======
(A) Revenues are reported net of interest expense, where applicable.
(B) Prior year's amounts for Travel Related Services (TRS) and
American Express Bank (AEB) have been restated to reflect the
transfer of certain consumer financial services businesses
from TRS to AEB.
(C) On May 31, 1994, the Company completed a tax free spin -
off of Lehman Brothers (LB) through a special dividend to
shareholders. Accordingly, LB results are reported as
Discontinued Operations for all periods presented. The
Discontinued Operations amounts in the table above represent
American Express' share of LB's results after preferred
dividends to Nippon Life Insurance Company.
Note: Certain prior year amounts have been reclassified to
conform to the current year's presentation.
<PAGE>
(Preliminary)
Travel Related Services
Statement of Income
(Unaudited)
(Amounts in millions, except percentages and where indicated)
Three Months Ended
September 30, Percentage
1994 1993 Inc/(Dec)
---- ---- ----------
Revenues:
Discount Revenue $996 $897 11.1%
Net Card Fees 435 433 0.5
Interest and Dividends 206 196 5.3
Other Revenues 727 627 15.9
----- -----
2,364 2,153 9.8
----- -----
Lending:
Finance Charge Revenue 317 295 7.3
Interest Expense 80 61 30.5
----- -----
Net Finance Charge Revenue 237 234 1.3
----- -----
Total Net Revenues 2,601 2,387 9.0
----- -----
Expenses:
Marketing and Promotion 274 275 (0.4)
Provision for Losses and Claims:
Charge Card 153 156 (2.1)
Lending 81 98 (17.2)
Other 131 120 9.5
----- -----
Total 365 374 (2.3)
Interest Expense:
Charge Card 164 173 (5.4)
Other Interest Expense 44 37 19.1
----- -----
Total 208 210 (1.1)
Net Discount Expense 93 55 68.0
Human Resources 651 556 17.2
Other Operating Expenses 646 606 6.6
----- -----
Total Expenses 2,237 2,076 7.8
----- -----
Pretax Income 364 311 17.1
Income Tax Provision 100 77 30.4
----- -----
Net Income $264 $234 12.8
===== =====
<PAGE>
Selected Statistical Information
Total Cards in Force:
United States 24.7 23.6 4.7
Outside the United States 10.9 10.6 2.5
----- -----
Total 35.6 34.2 4.0
===== =====
Basic Cards in Force:
U.S. Charge Card 11.1 11.5 (3.6)
U.S. Corporate Card 7.0 5.5 27.2
International Charge Card 8.0 7.9 1.6
----- -----
Total 26.1 24.9 4.8
===== =====
Card Billed Business (billions):
United States $25.2 $22.5 12.1
Outside the United States 10.3 8.3 24.1
----- -----
Total $35.5 $30.8 15.3
===== =====
Note: Prior year's results are stated on a consistent
basis with the current year's presentation and include
the impact of the transfer of certain consumer financial
services businesses to American Express Bank.
<PAGE>
(Preliminary)
Travel Related Services (continued)
Selected Statistical Information
(Unaudited)
(Amounts in millions, except percentages and where indicated)
Three Months Ended
September 30, Percentage
1994 1993 Inc/(Dec)
---- ---- ----------
Number of Service Establishments 3.8 3.5 8.8%
Travelers Cheque Sales (billions) $8.4 $8.0 5.9
Average Travelers Cheques
Outstanding (billions) $5.9 $5.5 8.2
Travel Sales (billions) $2.5 $2.0 25.0
Return on Average Equity 23.9% 24.0% -
<PAGE>
(Preliminary)
IDS Financial Services
Statement of Income
(Unaudited)
(Amounts in millions, except percentages and where indicated)
Three Months Ended
September 30, Percentage
1994 1993 Inc/(Dec)
---- ---- ----------
Revenues:
Investment Income $498 $527 (5.5%)
Fee Income 200 188 6.2
Other Income 124 101 23.3
----- -----
Total Revenues 822 816 0.8
----- -----
Expenses:
Provision for Losses and Benefits:
Annuities 256 270 (5.3)
Insurance 95 80 18.3
Investment Certificates 30 29 0.4
Other 0 2 (97.3)
----- -----
Total 381 381 (0.3)
Human Resources 213 200 6.4
Other Operating Expenses 60 95 (35.7)
----- -----
Total Expenses 654 676 (3.3)
----- -----
Pretax Income 168 140 20.3
Income Tax Provision 54 44 22.4
----- -----
Net Income $114 $96 19.4
===== =====
Selected Statistical Information
Life Insurance in Force (billions) $50.9 $44.8 13.6
===== =====
Assets Owned and/or Managed (billions):
Assets managed for institutions $26.7 $24.2 10.2
Assets owned and managed for
individuals:
Owned Assets 39.2 36.0 9.1
Managed Assets 38.5 35.8 7.6
----- -----
Total $104.4 $96.0 8.8
===== =====
Sales of Selected Products:
Mutual Funds $2,021 $2,097 (3.6)
Annuities $1,088 $1,078 0.9
Investment Certificates $324 $155 #
Life and Other Insurance Sales $78 $81 (3.7)
Fees From Financial Plans (thousands) $9,559 $9,621 (0.6)
Number of Financial Planners 7,847 7,554 3.9
Product Sales Generated from Financial
Plans as a Percentage of Total Sales 63.5% 58.3% -
Return on Average Equity 18.7% 17.7% -
# Denotes variance of more than 100%.
<PAGE>
(Preliminary)
American Express Bank
Statement of Income
(Unaudited)
(Amounts in millions, except percentages and where indicated)
Three Months Ended
September 30, Percentage
1994 1993 Inc/(Dec)
---- ---- ----------
Net Revenues:
Interest Income $249 $239 4.6%
Interest Expense 160 146 9.6
----- -----
Net Interest Income 89 93 (3.3)
Commissions, Fees and Other Revenues 57 60 (5.9)
Foreign Exchange Income 17 18 (9.1)
----- -----
Total Net Revenues 163 171 (4.8)
----- -----
Provision for Credit Losses 0 9 -
----- -----
Expenses:
Human Resources 62 59 3.9
Other Operating Expenses 70 66 8.0
----- -----
Total Expenses 132 125 6.0
----- -----
Pretax Income 31 37 (17.1)
Income Tax Provision 11 8 32.1
----- -----
Net Income $20 $29 (30.6)
===== =====
Selected Statistical Information
Return on Average Assets 0.54% 0.82% -
Return on Average Equity 10.27% 15.81% -
Total Loans $5,383 $5,438 (1.0)
Reserve for Credit Losses $118 $128 (8.2)
Total Nonperforming Loans $33 $87 (61.9)
Other Nonperforming Assets $57 $111 (48.2)
Risk-Based Capital Ratios:
Tier 1 6.7% 5.9% -
Total 13.0% 9.6% -
Leverage Ratio 4.2% 4.5% -
Note: Prior year's results are stated on a consistent
basis with the current year's presentation and include
the impact of the transfer of certain consumer financial
services businesses from Travel Related Services.
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
AMERICAN EXPRESS COMPANY
By: /s/ Stephen P. Norman
-------------------------
Name: Stephen P. Norman
Title: Secretary
Dated: October 25, 1994
<PAGE>
|
|