Electrical giant sees profits fall Westinghouse posts 28% drop for quarter

October 13, 1993|By Ted Shelsby | Ted Shelsby,Staff Writer Bloomberg Business News contributed to this article.

Westinghouse Electric Corp. reported a 28 percent drop in its third-quarter operating profits yesterday because of downturns in most of its major businesses.

Westinghouse said it earned $65 million, or 15 cents a share, for the three months that ended Sept. 30. That was in contrast to a profit from continuing operations of $91 million, or 22 cents a share, in the same period last year.

"Obviously, the third quarter's financial results are disappointing," said Michael H. Jordan, who took over as chairman and chief executive earlier this year.

The results, though below analysts' expectations, were better than the company said might be coming when it warned investors last month of a drop in earnings.

"The picture has improved a little bit since then," said Jay A. McCaffrey, a Westinghouse spokesman. "We can't point to any one event, but across the board, performance seems to be slightly better than anticipated."

Wall Street was expecting earnings of 18 cents a share, according to a survey of 12 analysts by Zacks Investment Research. Yesterday, the stock gained 12.5 cents, to close at $13.50.

"Westinghouse is continuing to see a lot of softness in its businesses. That's the bottom line," said Judy A. Meehan, an analyst with Pittsburgh-based Parker Hunter Inc. "Obviously, a stronger economy, especially in Europe, would help."

In all, Pittsburgh-based Westinghouse reported that third-quarter operating profits were down for five of its seven industry segments. Revenues totaled $2.06 billion, down from $2.26 billion in the same 1992 period.

Among those divisions reporting lower results was the company's Linthicum-based Electronic Systems Group, which continued to have problems. Westinghouse said operating profits of the local division were off more than 20 percent for both the third quarter and first nine months of the year, according to Ms. Meehan.

The corporation blamed the troubles on lower revenues from military contracts. Westinghouse, which employs about 12,500 workers in Maryland, has eliminated about 7,000 jobs here since 1991.

The only bright spot in Westinghouse's report, Ms. Meehan said, was the company's industries division, which posted more than a 20 percent increase in operating profits. This was primarily because of strong results for Thermo King, a worldwide supplier of temperature control equipment for trucks, trailers, ships and railway cars.

During the first nine months, Westinghouse earned $208 million, or 48 cents a share, from continuing operations. This compared with earnings of $278 million, equal to 77 cents a share, for the same period last year.

Including accounting changes for retiree health benefits and income taxes, Westinghouse posted a net loss of $110 million, or 36 cents, in the nine-month period last year.

Including a loss of $77 million, or 22 cents a share from discontinued operations, Westinghouse earned $14 million, or break-even on a per-share basis in the 1992 quarter. The per-share results last year reflected the payment of preferred dividends of $13 million.

Westinghouse Electric Corp.

.. .. .. .. ... .. ..Ticker .. .. .. .. .. ..Yesterday's

.. .. .. .. .. .. ...Symbol.. .. .. .. .. . Cls... .Chg.

.. .. .. .. .. .. .. ..WX .. .. .. .. .. ...13 1/2 .. ...+ Period ended Sept. 30

.. .. .. .. .. .. .. 3rd qtr. .. .. .Year ago .. ...Chg.

Revenue .. .. .. ...$2,060,000 .. ..$2,268,000 .. .-9.2%

Net Income .. .. .. ...$65,000 .. .. ..$14,000 ..+364.3%

Primary EPS .. .. .. ...$0.15 .. .. .. .$0.00 .. .. ..--

.. .. .. .. .. .. .. ..9 mos. .. .. ..Year ago .. ..Chg.

Revenue .. .. .. .. .$6,234,000 .. ..$6,693,000 .. -6.9%

Net Income .. .. .. ...$208,000 .. ...($110,00) .. ...--

Primary EPS .. .. .. .. .$0.48 .. .. ..($0.36) .. .. .--

Figures in thousands (except per share data.)

To receive, by fax, a free copy of the Westinghouse earnings report, dial Sunfax at (410) 332-6123 and enter the code 5600 after you hear the greeting.

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