Goldman Sachs beats by $0.65, beats on revs

Tuesday, March 18, 2008

Today's In Play


Reports Q1 (Feb) earnings of $3.23 per share, $0.65 better than the First Call consensus of $2.58; revenues fell 22.4% year/year to $8.34 bln vs the $7.47 bln consensus. Assets under management increased 21% from a year ago to a record $873 bln, with net inflows of $29 bln during the quarter. Net revenues in FICC were $3.14 bln, 32% lower than a strong 1Q07 as results were adversely affected by continued deterioration in the broader credit markets. Net losses on residential mortgage loans and securities were approximately $1 bln. In addition, credit products included a loss of approximately $1 bln ($1.4 bln before hedges) related to non-investment-grade credit origination activities, as well as lower results from investments compared with the first quarter of 2007. Net revenues in Trading and Principal Investments were $5.12 bln, 46% lower than the first quarter of 2007 and 26% lower than the fourth quarter of 2007. Book value per common share was $92.44 and tangible book value per common share was $80.28, each increasing 2% during the quarter. "Market conditions are clearly very difficult... But we saw strong customer activity across many of our franchise businesses in the first quarter. Although market conditions present many challenges at the moment, they also offer considerable opportunities."