E*Trade Q3 earnings up; narrows outlook

Source: E*TRADE FINANCIAL Corporation

E*TRADE FINANCIAL Corporation (NYSE: ET) today announced results for its third quarter ended September 30, 2006, reporting net income of $153 million, or $0.35 per share compared to $107 million, or $0.28 per share a year ago.

Excluding acquisition-related integration expenses, the Company earned $0.36 per share. Total net revenue for the third quarter increased 39 percent year over year to $582 million. Net operating interest income after provision for loan losses increased 68 percent year over year to a record $343 million - representing 59 percent of total net revenue.

The Company's record net operating interest income was the combined result of a 42 percent increase in enterprise interest-earning assets and a 34 basis point increase in enterprise net interest spread compared to the year ago period. Non-interest revenue increased 11 percent year over year to $239 million with higher commission-related revenue and lower gain on sales of loans and securities, net.

The Company also narrowed its 2006 earnings guidance range to $1.45 - $1.50 per share from the previous range of $1.42 - $1.52. As previously indicated, this range excludes $0.05 per share of acquisition-related integration expenses. This $0.05 was realized throughout the first three quarters of 2006. Including these expenses, the Company now expects to earn $1.40 - $1.45 per share on a GAAP basis in 2006, narrowed from the previous range of $1.37 - $1.47 per share.

"In the third quarter we generated growth in client assets and cash, fueled by expanded customer engagement across our suite of value-oriented financial solutions," said Mitchell H. Caplan, Chief Executive Officer, E*TRADE FINANCIAL Corporation. "Our success is a testament to our integrated business model, which delivers quality results through various market conditions. As we expand globally by exporting our proven US value proposition to our international locations, we are extremely optimistic about the long-term growth potential of the franchise."» Download the document now 69.6 kb (Adobe Acrobat Document)

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