4th-quarter earnings improve at Westinghouse Buying CBS, defense-unit sale made busy 3 months

February 09, 1996|By Ted Shelsby | Ted Shelsby,SUN STAFF

Westinghouse Electric Corp. reported a significant improvement in fourth-quarter earnings yesterday, but not enough to pull the company out of the red.

For the three months ended Dec. 31, Westinghouse posted a net loss of $7 million, equal to 2 cents a share. In the same period in 1994, the Pittsburgh-based conglomerate posted a deficit of $107 million, or 30 cents a share.

Revenues jumped 19 percent to $2.09 billion from $1.75 billion in the like part of 1994.

The results included slightly more than one month's contributions from Westinghouse's $5.4 billion purchase of CBS Inc., and included $59 million in acquisition-related interest costs.

Westinghouse changed dramatically in the quarter. In addition to acquiring CBS, it reached agreements to sell the bulk of the defense business of its Electronic Systems division in Linthicum to Northrop Grumman Corp. for $3.6 billion and its Knoll office furniture manufacturing operations in East Greenville, Pa., for another $565 million.

Susan Gallagher, an analyst with NatWest Securities in New York, said it was nearly impossible to make quarter-to-quarter comparisons of Westinghouse's finances as a result of the changes that affected about a third of its total sales.

Profit from continuing operations, which does not include results of the local defense arm, fell 49 percent in the quarter to $46 million, or 10 cents a share, down from $91 million, or 20 cents a share, in the year-ago period.

"The majority of our businesses performed well," Michael H. Jordan, chairman and chief executive, said in a prepared statement. "In fact, excluding power generation, operating profit, including discontinued operations, increased 28 percent before special charges."

He said "double-digit profit gains were achieved in combined television and radio operations, Thermo King, Energy Systems, Knoll and Electronic Systems."

The company did not release detailed financial results of the local defense arm because it is being sold to reduce debt from the CBS acquisition.

Westinghouse said its Power Generation division's sales for thquarter and the year remained slightly ahead of those in 1994, but operating profit was down 50 percent for the quarter and 90 percent for the year.

For the year, Westinghouse reported net income of $15 million, or 3 cents a share, compared with $77 million, or 7 cents a share, in 1994.

Excluding special items, the company earned $255 million, or 58 cents a share, compared with net income of $323 million, or 71 cents a share, a year earlier.

On a continuing operations basis, the company lost $44 million, or 10 cents a share, compared with a loss of $13 million, or 16

cents a share, in 1994. Sales rose 6.9 percent to $6.3 billion from $5.9 billion. Westinghouse's stock dropped $1 yesterday to close at $19.625.

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