Stock analysts were disappointed with the earnings of Armco Inc., which reported that it lost $8.5 million in the fourth quarter, or 12 cents a share, compared with a profit of $15.5 million, or 15 cents a share, in the 1989 fourth quarter.
Armco, the Parsippany, N.J.-based stainless steelmaker with an operation in Baltimore, had fourth quarter sales of $414 million, a 5.3 percent drop from the previous fourth quarter when sales were $416.2 million.
Charles Bradford, a steel analyst with UBS Securities Inc., a institutional brokerage firm in New York, said he was particularly disturbed by the loss of $30 per ton on the company's regular steel production. "There was no excuse for that," he said.
While the company blamed the fall on a lower volume of business, Bradford said he could not get a good explanation for the decline.
Jeffrey Miller, an analyst for Duff & Phelps Inc., an investment research firm in Chicago, attributed the loss to the company being more closely tied to automobile production, which is in a downturn.
The company's stock increased yesterday by 12 1/2 cents a share to close at $4.50.
For the year, Armco lost $89.5 million, or $1.10 a share, compared with a net income of $165 million, or $1.78 a share, for 1989. The 1990 loss included unusual items that reduced income by $86.1 million. About $56 million of this amount was for claims steming from lawsuits against the company and $30 million was put into reserves to cover possible claims against Armco's discontinued re-insurance operation.
Sales for the year were $1.7 billion, a 28.4 percent drop from 1989 sales of $2.4 billion.