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LTV REPORTS FOURTH QUARTER NET LOSS OF $8.5 MILLION

 LTV REPORTS FOURTH QUARTER NET LOSS OF $8.5 MILLION
 DALLAS, Feb. 5 /PRNewswire/ -- The LTV Corporation (NYSE: QLTV)


today reported a fourth quarter net loss of $8.5 million on consolidated sales of $1.52 billion, compared with a net loss of $19.5 million on sales of $1.61 billion for the fourth quarter of 1990.
 For the year ended Dec. 31, 1991, LTV reported a net income of $74.1 million on consolidated sales of $5.99 billion, compared with net income of $70.9 million on sales of $6.14 billion for the prior year.
 Results for 1991 include a third quarter income tax refund of $129.7 million and related interest income of $53.3 million received in the fourth quarter. The refund resulted from a provision of the Tax Reform Act of 1986 allowing steel companies an elective 15-year carryback of unused investment tax credit carryforwards existing at Dec. 31, 1985.
 The 1991 results also include a first quarter special charge of $10 million for costs primarily related to personnel reductions. Results for 1990 included a fourth quarter special charge of $25 million for the planned disposition of LTV's Sierra Research defense electronics unit, and a $44.3 million gain on the sale of LTV's remaining investment in a former steel subsidiary.
 LTV's aerospace and defense operations reported improved results for the fourth quarter and full year 1991, while the company's steel and energy products businesses experienced declines.
 LTV Chairman and Chief Executive Officer David H. Hoag said: "Our steel and energy products businesses continue to suffer the effects of the ongoing national recession. Steel shipments to key markets are down, in part, because consumer confidence has not rebounded enough to increase demand for big ticket items. In addition, the decline of domestic oil and gas exploration and production activity to the lowest levels in nearly half a century is having a detrimental effect on our energy products and oilfield supply business."
 LTV's aerospace and defense business reported fourth quarter operating income of $14.0 million and annual operating income of $115.7 million in 1991. For the same periods, LTV's steel operations reported operating losses of $54.0 million and $202.8 million, respectively, and LTV's energy products business reported operating losses of $16.3 million and $15.3 million, respectively.
 Operating results continue to reflect charges stemming from the company's adoption in 1988 of a change in accounting for postemployment medical and life insurance benefits. Because of the accounting change, LTV's results are proportionately worse than those of companies which have not yet adopted this standard.
 For LTV's operating groups, the negative incremental effect of this method of accounting was (in millions):
 Fourth Quarter Year
 1991 1990 1991 1990
 Steel $41.8 $45.7 $139.0 $129.0
 Aerospace and Defense 21.3 19.9 75.9 71.6
 Energy Products (0.5) 0.4 (0.3) 1.9
 Total effect on
 operating income (loss) $62.6 $66.0 $214.6 $202.5
 LTV continues to defer certain expenses while operating under the protection of Chapter 11. Increased postemployment expenses partially offset the effect of these deferrals.
 LTV's cash and cash equivalents totaled $1.17 billion at Dec. 31, 1991, compared with $1.08 billion at Dec. 31, 1990.
 Steel Operations
 LTV's steel business recorded a fourth quarter operating loss of $54.0 million, compared with an operating loss of $11.1 million in the fourth quarter of 1990. Sales declined to $850 million from $927 million, and shipments decreased to 1.65 million tons from 1.70 million tons a year earlier.
 The fourth quarter operating loss resulted from lower selling prices and shipments and higher employment costs arising from a Jan. 1, 1991, wage increase for employees represented by the United Steelworkers of America (USWA).
 Revenues declined because of decreased shipments, lower sales of non-steel products and lower average selling prices. The decline in shipments reflected the continuing effects of the recession which resulted in lower demand for steel.
 "We continue to be concerned with the difficult economic conditions affecting our steel customers," Hoag said. "We are applying the company's full resources and capabilities to keep our operating costs as low as possible in an effort to offset the decline in steel prices to 1981 levels."
 LTV's steel plants operated at 84 percent of capacity during the fourth quarter, compared with 75 percent during the same period of 1990.
 For the year, the steel operating loss was $202.8 million on sales of $3.39 billion, compared with operating income of $55.7 million on sales of $3.86 billion for 1990. Shipments decreased to 6.63 million tons from 7.26 million tons in the prior year, and average plant operating rates declined to 78 percent of capacity from 84 percent, reflecting the year-long economic slump.
 The annual operating loss resulted from lower shipments and selling prices, as well as higher employment costs and lower operating rates. Hourly employment costs increased $84 million in 1991 as a result of wage and medical benefit increases in the 1990 USWA agreement. Results also were impacted by a 67-day scheduled reline of a major blast furnace.
 During 1991, LTV Steel received approval from the U.S. Bankruptcy Court to proceed with the first phase of an additional continuous slab caster at its Cleveland Works. When completed, the new casting complex will result in the company producing 100 percent of its steel by the more efficient and higher quality continuous casting process. This is essential to enhancing LTV's ability to compete successfully in worldwide steel markets.
 Aerospace and Defense
 LTV's aerospace and defense business reported fourth quarter operating income of $14.0 million on sales of $592 million, compared with operating income of $8.8 million on sales of $599 million in the fourth quarter of 1990.
 Improved operating results in a number of programs contributed to the increase in fourth quarter operating income. Principal among the programs showing improvement were: the B-2 bomber, Hummer military vehicle, Boeing commercial aircraft and advanced missile programs. These gains were partially offset by lower operating results for A-7 aircraft components and support, the Canadair CL-601 and Regional Jet, and the Multiple Launch Rocket System (MLRS).
 Fourth quarter sales approximated those of the prior year, as increases in most programs were offset by lower MLRS, Boeing 747, and A-7 sales.
 For the year, aerospace and defense operating income was $115.7 million on sales of $2.29 billion, compared with an operating loss of $17.3 million on sales of $1.96 billion in 1990.
 The operating income was primarily due to improvements in current and projected performance. This resulted in lower estimated costs and improved profit rates on several missile, wheeled vehicle and commercial aircraft structure programs. Profit also improved because of finalization of certain contracts, principally A-7 related; higher deliveries on government and commercial programs; and profit recognition on current deliveries of commercial aircraft programs for which no profit was recognized in 1990.
 Annual sales increases were recorded for the B-2 bomber, Hummer vehicle and service parts, Army Tactical Missile System, Extended Range Interceptor missile, C-17 airlifter, and Boeing commercial aircraft programs, partially offset by sales declines for A-7 and support, MLRS, Line-of-Sight Antitank weapon and advanced missile programs.
 No 1991 sales, operating income, orders or backlog were reported for Sierra Research, LTV's defense electronics business, which is being held for disposition.
 The aerospace and defense backlog at Dec. 31, 1991, was $4.5 billion, including $795 million of unfunded multiyear contracts.
 President Bush has announced that he will ask Congress to limit production of the B-2 stealth bomber to 20 aircraft. While the B-2 reduction would have a significant impact on the future operating results of LTV's aircraft division, the division still has at least two years of production remaining at the 20 aircraft level.
 "We are, of course, very disappointed by the President's proposed cuts," Hoag said. "We still believe the B-2 is a national asset. With its worldwide capability that allows for flexible response from stateside bases, the B-2 clearly fits into the projected downsizing of our forces."
 Energy Products
 LTV's energy products business recorded a fourth quarter operating loss of $16.3 million on sales of $74 million, compared with operating income of $1.4 million on sales of $86 million for the same period of 1990.
 The 1991 loss was primarily the result of charges taken in the quarter, principally for excess and slow-moving inventory triggered by the continued economic downturn.
 The write-downs reflected the continuing decline in U.S. drilling activity and the increasingly poor prospect of a near-term recovery. Drilling activity in the fourth quarter was at the lowest level in the United States since 1942. The decline had a severe impact on the part of LTV's energy products business that is primarily focused on the U.S. market. This was partially offset by increased sales and income from international markets.
 For the year, energy products had an operating loss of $15.3 million on sales of $310 million, compared with operating income of $8.1 million on sales of $318 million in 1990. The operating loss resulted from the previously mentioned write-downs, and the sales decline reflected a continuing downturn in domestic drilling activity.
 Chapter 11 Status
 On Jan. 17, the bankruptcy court extended LTV's exclusive right to file a plan of reorganization until Feb. 14. LTV representatives told the court the company expects to file a new plan on that date and that there has been substantial progress made toward bringing the various creditor groups into agreement.
 The company also announced an agreement in principle to sell its aircraft and missiles operations. Bankruptcy court approval of the sale will be sought when a definitive agreement is reached.
 LTV has already obtained court approval to sell certain net assets of its defense electronics unit and its military vehicle manufacturing business. Those transactions are expected to close late in the first quarter.
 LTV is a diversified manufacturing company involved in steel, aerospace/defense and energy products.
 THE LTV CORPORATION AND SUBSIDIARIES
 Summary of Consolidated Operations
 (Dollars in millions, except per share data)
 Three months ended Dec. 31 1991 1990
 Sales:
 Steel $ 850.4 $ 926.9
 Aerospace and Defense 592.3 599.4
 Energy Products 74.3 86.4
 Sales between segments -- (1.1)
 Total $ 1,517.0 $ 1,611.6
 Operating income (loss):
 Steel $ (54.0) $ (11.1)
 Aerospace and Defense 14.0 8.8
 Energy Products (16.3) 1.4
 Subtotal (56.3) (0.9)
 Special charges (A) -- (25.0)
 Total (56.3) (25.9)
 Interest and other income (expense), net (B) 58.0 11.2
 Income before taxes 1.7 (14.7)
 Income tax credit (charge) (C) (10.2) (4.8)
 Net income $ (8.5) $ (19.5)
 Earnings per share:
 Fully diluted $ (0.12) $ (0.23)
 Primary $ (0.12) $ (0.23)
 Average number of common shares used
 in per share calculation (thousands):
 Fully diluted 119,253 114,268
 Primary 119,253 114,268
 Raw steel production - tons (millions) 2.064 1.847
 Steel plant operating rate 84 pct 75 pct
 Steel shipments - tons (millions) 1.646 1.703
 Twelve months ended Dec. 31 1991 1990
 Sales:
 Steel $ 3,392.5 $ 3,860.4
 Aerospace and Defense 2,285.2 1,961.3
 Energy Products 309.9 318.4
 Sales between segments (1.2) (1.8)
 Total $ 5,986.4 $ 6,138.3
 Operating income (loss):
 Steel $ (202.8) $ 55.7
 Aerospace and Defense 115.7 (17.3)
 Energy Products (15.3) 8.1
 Subtotal (102.4) 46.5
 Special charges (A) (10.0) (25.0)
 Total (112.4) 21.5
 Interest and other income (expense), net (B) 71.5 71.8
 Income (loss) before taxes (40.9) 93.3
 Income tax credit (charge) (C) 115.0 (22.4)
 Net income (loss) $ 74.1 $ 70.9
 Earnings (loss) per share:
 Fully diluted $ 0.39 $ 0.34
 Primary $ 0.43 $ 0.38
 Average number of common shares used
 in per share calculation (thousands):
 Fully diluted 132,636 127,720
 Primary 117,927 112,999
 Raw steel production - tons (millions) 7.652 8.198
 Steel plant operating rate 78 pct 84 pct
 Steel shipments - tons (millions) 6.629 7.255
 (A) -- During the first quarter of 1991, the company incurred restructuring charges of $10.0 million for costs primarily related to personnel reductions at Corporate and at the operating groups. The $25.0 million special charge in 1990 represents a provision for the planned disposition of the aerospace and defense group's defense electronics business.
 (B) -- Interest and other income (expense), net for the three and 12 months of 1991 includes $53.3 million of interest income received in December which relates to the tax refund (see (C) below). Interest and other income (expense), net for the 12 months of 1990 includes a $44.3 million gain on the sale of LTV's remaining investment in the stock of a former subsidiary. Interest and other income (expense), net includes Chapter 11 administrative expenses of $8.2 million and $6.0 million for the three months ended Dec. 31, 1991 and 1990, respectively, and $33.0 million for both the 12 months of 1991 and 1990.
 (C) -- Income tax credit (charge) for the 12 months ended Dec. 31, 1991, includes a $129.7 million refund pursuant to the Tax Reform Act of 1986 which provides for an elective 15-year carryback by steel companies of their unused investment tax credit carryforwards existing at Dec. 31, 1985. Under the Act, the tax refund must be used in the manufacture or production of steel.
 (D) -- The company routinely reports per share information, calculated in accordance with generally accepted accounting principles, but it believes such figures for a company operating under Chapter 11, with a substantial shareholders' deficit, have little significance.
 -0- 2/5/92
 /CONTACT: Jim Bowman, 214-979-7981, or Charles M. Palmer, 214-979-7941, both of LTV/
 (LTV) CO: LTV Corporation ST: Texas IN: ARO SU: ERN


GK -- NY035 -- 7166 02/05/92 12:05 EST
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