Cendant Profits up 19%; Fewer Acquisitions Planned for '03

NEW YORK CITY-Cendant Corp. is boasting a 19% rise in Q3 profits, but the hotel mega-franchiser will cut back on acquisitions for the near term and will buy back up to $200 million of its stock. The locally based firm’s third-quarter net income rose from $210 million or 23 cents a share last year, to $250 million or 24 cents in ’02.

The gains reflect a $175-million mortgage-assets writedown, which played against profits from some $2 billion in acquisitions made by the company over the last two years, nearly $400 million of which were made during the third quarter.

“On a cash basis, our business segments performed at or ahead of expectations this quarter, despite a challenging environment for commercial travel and corporate spending,” says Cendant chairman, president and CEO Henry R. Silverman. “Upside was driven primarily by our residential real estate brokerage and Avis car rental businesses. Although our reported mortgage servicing earnings were negatively impacted by unprecedented levels of refinancing activity, our servicing portfolio grew and recurring cash flow increased.”