Lukens surprises with another loss Beth Steel's intended still having difficulty with stainless division

Steel

January 21, 1998|By BLOOMBERG NEWS

COATESVILLE, Pa. -- Lukens Inc. posted an unexpected fourth-quarter loss as continued troubles at the company's stainless steel division more than offset strong sales of steel plate.

The company's loss from operations narrowed to $4.0 million, or 30 cents a diluted share, from $4.4 million, or 33 cents, in the year-ago quarter. Sales rose 13 percent to $244.6 million.

The company was expected to earn 12 cents a share, the average estimate of six analysts surveyed by IBES International Inc. Lukens fell 6.25 cents yesterday to close at $31.4275.

Lukens agreed earlier this month to be acquired by Bethlehem Steel Corp. for $740 million, or $30 a share. If Bethlehem buys Lukens, it will close its Sparrows Point plate mill in Baltimore County in about a year, eliminating 400 jobs.

Allegheny Teledyne Inc., a Pittsburgh-based diversified manufacturer, had made a $715 million offer for Lukens, topping Bethlehem's original $650 million offer. Allegheny Teledyne said yesterday that it continues to "consider its options."

Lukens' stainless division, hampered by start-up costs at a Massillon, Ohio, mill, widened its fourth-quarter operating loss to $10.8 million from $1.5 million a year earlier. Shipments fell 3.4 percent to 51,200 tons.

The carbon and alloy plate group's fourth-quarter operating profit almost quadrupled, to $16.5 million from $4.3 million a year earlier. Shipments rose 34 percent to 206,800 tons.

Last month, Lukens said it will raise prices for several types of steel plate by $20 a ton, a range of about 2 percent to 3 percent, on shipments beginning March 29.

In the year-ago quarter, asset write-downs and environmental charges totaling $9.8 million, or 66 cents a share, resulted in a final loss of $14.2 million, or 99 cents a share. No special items were recorded in the recent quarter.

For the year, the company narrowed its loss from operations to $4.6 million, or 45 cents a diluted share, from $11.7 million, or 94 cents, in 1996. Sales rose 2 percent to $994.4 million.

Carbon and alloy group shipments rose 34 percent in the year to a record 753,900 tons as production at a new plate mill in Conshohocken, Pa., rose 30 percent.

Pub Date: 1/21/98

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