Trying to pull itself out of a flood of red ink, Bethlehem Steel Corp. announced today that it will eliminate its dividend, cut its total work force by 6,500 and dispose of its bar, rod and wire division -- a move that will affect more than 400 workers at the company's Sparrows Point steel mill in Baltimore County.
The steel maker lost $638.1 million, or $8.47 a share, during the fourth quarter of 1991, compared with a loss of $516.8 million, or $6.91 a share, for the 1990 fourth quarter. Revenues for the quarter were $1 billion, compared with $1.2 billion for the comparable quarter of 1990.
Much of the loss was from a $575 million restructuring charge connected with the plan to leave the bar, rod and wire business. Other factors: the modernization of the hot strip mills at Sparrows Point and the relining of a blast furnace at Bethlehem's Burns Harbor, Ind., plant.
Because of the continuing losses, the company said it was eliminating its 10-cent a share quarterly dividend.
For the year, the company lost $767 million, or $10.41 a share, compared with a loss of $463.5 million, or $6.45 a share, for 1990. Sales during 1991 were $4.3 billion, compared with $4.9 billion for 1990.
The bar, rod and wire division operates an electric steel furnace and production facilities in Johnstown, Pa., a bar mill in Lackawanna, N.Y., and a rod mill at Sparrows Point. The local rod mill employs about 350 people, according to local Bethlehem spokesman G. Ted Baldwin.
Bethlehem said it intends to sell the entire division to a buyer who would continue the business. If the company cannot find a buyer in the near future, it will sell the division's assets. Bethlehem has hired Salomon Brothers Inc. as a financial adviser to implement these plans.
The company also announced it will be taking the coke oven operation at Sparrows Point from a "hot idle" status to a "cold idle" condition because it found that needed repairs to meet air pollution control standards were more extensive than anticipated, according Mr. Baldwin. Normally, the coke ovens, which supply coke for the steel-making process, would be kept warm so as not to harm the silica brick that lines the ovens.
This action will result in another 40 people being laid off, according to a company press release. The Sparrows Point mill has a work force of about 6,400.