Westinghouse loss at $478 million

January 22, 1994|By Ian Johnson | Ian Johnson,New York Bureau

NEW YORK -- Westinghouse Electric Corp. reported heavy losses yesterday after taking a $750 million charge to pay for layoffs and plant closures.

The announcement was not a surprise. The company had warned that its earnings would be adversely affected by its restructuring.

The company's stock reacted marginally to the news. Westinghouse shares closed at $13.625, down 25 cents, on the New York Stock Exchange.

The Pittsburgh-based company, which employs 10,000 in Maryland, said it lost $478 million for the three-month period ending Dec. 31, compared to $1.28 billion for the same period a year earlier, when it also took a large restructuring charge. The per-share loss worked out to $1.38 vs. $3.74 for the same period a year earlier.

Revenues for the quarter increased 3.5 percent to $2.6 billion.

For the year, Westinghouse lost $326 million, or $1.07 per share, compared with $1.39 billion, or $4.11 a share, in 1992. Its revenues sank 4 percent to $8.87 billion last year.

Last year's losses were due to the $750 million restructuring charge, which cut earnings by $493 million after taxes. Announced 10 days ago, the charge calls for Westinghouse to lay off 3,400 employees and eliminate another 2,600 jobs through attrition. The company also cut its annual dividend in half to 20 cents and is to issue $500 million in preferred stock.

The company has not announced where the jobs will be cut.

Without the restructuring charge, Westinghouse would have made $318 million or 76 cents a share.

Analysts said the results were what Westinghouse had signaled when it announced the restructuring Jan. 11.

"There's nothing in it that they hadn't announced," said James E. Peirce, an analyst with PNC Bank in Philadelphia. "This is what we expected."

Others were more disappointed with the company, which has seen the value of its stock cut by three-quarters over the past 3 1/2 years.

"I wouldn't say that they issued an earnings report yesterday," said analyst John Hilton of Argus Research. "Did they earn any money? No, they just lost money."

Westinghouse Electric Corp.

&Ticker .. .. .. Yesterday's

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

WX ... .. .. .. 13 5/8 . .. - 1/4

Period ended

Dec. 31 . .. .. 4th qtr. .. .. Year ago .. .. Chg.

Revenue . .. .. $2,640,000 ... $2,550,000 ... +3.5%

Net Income . .. ($478,000) .. ($1,284,000) .. .. --

Primary EPS ... .. ($1.38) .. .. . ($3.74) .. .. --

... .. .. .. .. 12 mos. ... .. Year ago .. .. Chg.

Revenue . .. .. $8,875,000 ... $9,251,000 ... -4.1%

Net Income . .. ($326,000) . ($1,394,000) ... .. --

Primary EPS ... .. ($1.07) .. ... ($4.11) ... .. --

Figures in thousands (except per share data.)

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