WILMINGTON, Del. -- Despite a disappointing first-quarter loss of $41 million, the head of Bethlehem Steel Corp. remains hopeful that 1993 will be the company's turnaround year.
Addressing the company's annual meeting yesterday, Bethlehem Chairman and Chief Executive Curtis H. Barnette said the steel company intends to reduce costs further through more efficient operations, make more higher-priced, more finished-steel products and improve quality during the rest of the year.
"We expect that these actions, together with continued improvements in steel markets and the achievement of fair trade in steel, will return Bethlehem to profitability this year," Mr. Barnette told shareholders.
He did not say in which quarter he expected the company to be profitable or whether the year would end with Bethlehem Steel in the black.
Bethlehem, which owns the Sparrows Point steel mill and shipyard in Baltimore County, has not had a profitable quarter since the 1990 third quarter. The local steel mill and shipyard have a work force of about 6,800.
The first-quarter loss, which amounted to 54 cents a share, compared to a loss of $286.3 million, or $3.82 a share, in the 1992 first quarter. Excluding a $250 million charge for accounting rule changes, the 1992 first-quarter loss was $36.3 million, or 55 cents a share -- better than this year's first three months.
However, Mr. Barnette said a fairer comparison was with the 1992 fourth quarter, because the previous first quarter was affected by the changes in accounting rules and represented a different mix of product sales.
Compared with operating results in last year's fourth quarter, the latest three months' operating loss was $45 million less. "This improvement was due to higher shipments, lower production costs and an improved product mix," Mr. Barnette said.
Steel production at both Sparrows Point and the Burns Harbor, Ind., plant were up from a year ago, he said. And the value of those products increased because of the start of hot-dip galvanizing lines at both mills.
However, overall steel prices in the first quarter were down from a year ago, Mr. Barnette said.
Bethlehem, as well as other major steel companies, has been trying to raise steel prices, and Mr. Barnette said he expected them to to be successful later this year.
Results for the company's Sparrows Point shipyard improved during the quarter as work continued on a tunnel fabrication contract for Boston's harbor and ship repair work increased.
At a news conference after the meeting, Mr. Barnette said he was hopeful that Bethlehem would be able to sign a letter of intent within the next two months to sell its closed bar, rod and wire division.
Bethlehem had a tentative agreement to sell the division to Ispat Mexicana S.A. de C.V., an Indian-owned company. But that deal fell through when Ispat was unable to reach a labor agreement with the United Steelworkers of America.
In its own negotiation with the Steelworkers, Bethlehem Steel expects to have a new contract with the union before the current pact expires July 31, Mr. Barnette said.
% Bethlehem Steel Corp.
Ticker.. .. .. .. .. .. .. .. Yesterday's Symbol.. .. .. .. .. .. .. .. Cls.. .. .. .. ..Chg.
.. .. .. .. .. .. .. .. .. .19 1/8 .. .. .. .. ..+ 1/4
March 31 .. .. .. .. ..1st qtr.. .. .. .. .. Year ago .. Chg.
Revenue .. .. .. .. ..$1,020,400 .. .. .. .. $995,400.. .+2.5%
Net Income .. .. .. ..$(41,300).. .. .. .. ..$(286,300)*.. --
Primary EPS.. .. .. ..$(0.54) .. .. .. .. .. $(3.82)*.. .. --
Figures in thousands (except per share data.)
* Excluding a charge for an accounting rule change, the loss for the 1992 first quarter was $36.3 million, or 55 cents a share.