Hit by a sudden downturn in steel orders, the Bethlehem Steel Corp. is expected to report its first quarterly operating loss in more than three years, steel industry experts said yesterday.
Henry Von Spreckelsen, a spokesman for the Bethlehem, Pa.-based steelmaker, said yesterday that orders had held up through January despite the recession. But demand from automobile and appliance factories fell precipitously, starting in the middle of February, he said.
Despite the downturn, the nation's second-largest steelmaker still expects to continue with its costly equipment-upgrading plan, expected to total $500 million in 1991, and still plans to renovate the hot strip mill at its Sparrows Point yard sometime this spring, he said.
Bethlehem has been making more steel than its orders required recently so that it won't run out of steel when it shuts down and renovates the Baltimore mill, which makes thin sheets of steel, Mr. Von Spreckelsen said.
While some products made at the company's Baltimore yard, such as tin-plated sheets of steel for soup cans, are still doing well, others,such as galvanized roofing steel, are flagging, he said.
Walter Scott, who heads one of the Steelworkers union locals at Sparrows Point, said yesterday that the plant has remained busy so far this year.
Investors appeared not to be surprised by the pending loss. Bethlehem's stock price dropped slightly, 12 1/2 cents, to close at $12.75 a share in New York Stock Exchange trading after the announcement.
Charles Bradford, a steel industry analyst for UBS Securities in New York, said nearly every major steelmaker is expected to lose money in the first quarter and that Bethlehem's projected loss of $30 million to $40 million isn't out of line.
Mr. Bradford said that Bethlehem's profits, which had rebounded after billion-dollar losses in the recession of the early 1980s, had held up pretty well until late last year and that this would be the company's first operating loss in at least three years.