Bethlehem Mills Turn A Profit

January 27, 1994|By Ross Hetrick | Ross Hetrick,Staff Writer

Bethlehem Steel Corp.'s mill operations turned a profit for the first time in three years last year, but a huge restructuring charge in the fourth quarter for the company's Bethlehem, Pa., plant resulted in a $266.3 million annual loss.

Among the company's profitable divisions was the Sparrows Point steel mill in Baltimore County, which was also in the black for the first year since 1989.

The company reported a net loss of $242.6 million during the fourth quarter. Without the after-tax restructuring charge of $290 million, the company would have had a profit of $47 million in the fourth quarter and $24 million for the year.

"We have achieved profitability in two consecutive quarters, as we said we would," said Curtis H. Barnette, Bethlehem's chairman and chief executive officer. Bethlehem reported a $31.2 million net profit in the third quarter last year, after 11 consecutive unprofitable quarters.

Mr. Barnette said he expects the improvement to continue this year, with steel shipments from company mills forecast to increase by 300,000 tons, from last year's 9 million tons.

"We will be competitive in our market and responsive to our customers," he said at news conference in Bethlehem.

The restructuring charge involves reductions at the company's Bethlehem plant that are part of plans to discontinue production by 1996 of heavy-duty I-beam used in high-rise buildings. The Bethlehem plant's work force will drop from 3,600 to 1,600 in the next two years.

The charge also includes the write-down of the value of the coke ovens at Sparrows Point, which have been inactive for two years. But Mr. Barnette stressed the write-down was an accounting action, and the company has not yet decided on whether to renovate and reopen the ovens.

"It is being intensely studied now," Mr. Barnette said, adding that a decision may be made in 1995.

Mr. Barnette said the Sparrows Point mill, which has 5,800 workers, showed significant improvement as it reduced operating costs and sold higher-profit products.

Bethlehem's shipyard, which is adjacent to the Sparrows Point mill, was part of a division that lost $22 million for the year. That division also comprises two steel operations in Bethlehem, Pa.

The shipyard, which has a work force of 1,200, completed work on sections for the Boston Harbor tunnel. The company said it was hurt by the terms of a new labor contract that was reached after a two-week strike. BethShip now has contracts to renovate five ships for the U.S. Ready Reserve fleet.

Wall Street reacted favorably to yesterday's news, pushing up the stock by $1.625, to $23.25 a share.

To receive, by fax, a copy of Bethlehem Steel's fourth-quarter earnings report, dial Sunfax at (410) 332-6123. After you hear the greeting, enter the information number 5500.

@Bethlehem Steel Corp.

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

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

.. .. .. .. .. .. .. .. .. .. .BS .. .. .. .23 1/4 .. .. .. .. .. .+1 5/8

Period ended

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

Revenue .. .. .. .. .. ..$1,130,300 .. .. .$990,400 .. .. .+14.1%

Net Income .. .. .. .. ..$(242,600)* .. ...$(56,200) .. .. .. .--

Primary EPS .. .. .. .. .. .$(2.78)* .. .. ..$(0.69) .. .. .. .--

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

Revenue .. .. .. .. .. ..$4,323,400 .. ...$4,007,900 .. .. .+7.9%

Net Income .. .. .. .. ..$(266,300)* .. ..$(550,300) .. .. .. .--

Primary EPS .. .. .. .. .. .$(3.37)* .. .. ..$(7.01) .. .. .. .--

* Includes a $290 million, or $3.18 per share, after-tax charge for restructuring.

Figures in thousands (except per share data.)

Baltimore Sun Articles
|
|
|
Please note the green-lined linked article text has been applied commercially without any involvement from our newsroom editors, reporters or any other editorial staff.