American Telephone & Telegraph Co. reported yesterday that its profits are rising again after being hurt earlier this year by the recession.
AT&T, the largest company in the world, reported profits of $1.59 billion ($2.14 a share) in the three months ended Aug. 31, were up 8.1 percent from $1.47 billion ($2.08) in the same quarter of 1979.
The increase followed a year-to-year decline in the preceding quarter, the first drop for the Bell System since the last recession in 1975.
But the increase in profits was smaller than the growth in revenues, indicating a continuing shrinking of margins, and AT&T said profitability, as measured by return on common stockholders' equity, fell to 13.23 percent from 13.35 percent in the same quarter of 1979.
"It is too early to tell whether this improvement signals a resumption of the company's historic upward earnings trend," AT&T Chairman Charles L. Brown said. "What is certain is that it was accomplished in the face of continuing inflation and recession and thus must largely be credited to effective management by the Bell companies."
Revenues for the quarter rose 11.7 percent to $12.84 billion from $11.49 billion, AT&T said.
For the 12 months that ended Aug. 31, profits were $5.88 billion ($8.07) compared with $5.53 billion ($7.95).
AT&T said that in the most recent quarter the volume of long-distance calling increased by 8.1 percent compared with a growth of 10 percent in the 1979 quarter. It said Bell companies added 545,000 telephones and 430,000 lines in the quarter compared with 1.055 million phones and 631,000 lines in the 1979 period.
R.H. Macy & Co., a retail merchandising chain, earned $103.02 million ($6.48 a share) in the year ended Aug. 2, up from $76.42 million ($4.85) the previous year, on a rise in sales to $2.373 billion from $2.058 billion.
But fourth-quarter profits were level with year-ago results despite a rise in sales to $521.63 million from $469.07 million.
The company did not comment on the softer earnings for the latest quarter. It did say that five stores have been opened in the past month, bringing the company's total to 87.