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FEDERAL-MOGUL ANNOUNCES RECORD 1992 SALES, DECLARES FIRST-QUARTER 1993 DIVIDEND

 SOUTHFIELD, Mich., Feb. 3 /PRNewswire/ -- Federal-Mogul Corporation (NYSE: FMO) today reported that sales for the fourth quarter and the full year 1992 reached record levels. Net sales were $358.1 million for the 1992 fourth quarter, a 34-percent increase over the same 1991 period, reflecting the addition of the TRW automotive aftermarket business in October 1992. Net sales for the year ended Dec. 31, 1992, were $1.3 billion, approximately $165 million more than the previous year.
 As a result of previously announced special charges, the company realized a net loss for the fourth quarter and year ended Dec. 31, 1992, of $3.6 million or $.26 per share and $83.7 million or $3.94 per share, respectively. The company reported a loss from continuing operations of $24.3 million or $1.12 per share and $19.8 million or $1.03 per share for the comparable fourth quarter and total year ended Dec. 31, 1991, respectively. The two previously announced special charges include a fourth-quarter pre-tax charge of $14 million or $.40 per share to recognize certain restructuring costs associated with the recently completed acquisition of TRW's automotive aftermarket business. The company also elected to adopt FASB Statement No. 106 "Employers' Accounting for Post Retirement Benefits Other Than Pensions" effective Jan. 1, 1992. This action resulted in a one-time after-tax charge of $88.1 million or $3.93 per share for the immediate recognition of the accumulated obligation at that date, and ongoing expenses to operations of $4.9 million after tax or $.22 per share in 1992. Prior quarters in 1992 will be restated as a result of adopting FASB 106.
 Earnings before the two special charges for the quarter and year ended Dec. 31, 1992, were $6.5 million or $.19 per share and $18.2 million or $.61 per share, respectively. The company provided the following reconciliation of earnings from operations and special charges, which resulted in reported losses, to clarify these complex reporting issues:
 Year Ended Dec. 31, 1992
 Total 4th Previous
 Earnings per share Year Quarter Quarters
 Earnings from operations
 before special charges $.61 $.19 $.42
 TRW acquisition - related
 restructuring costs (.40) (.40) ---
 FASB 106 adoption:
 Cumulative effect (3.93) --- (3.93)
 Additional 1992 expense (.22) (.05) (.17)
 Reported loss ($3.94) ($.26) ($3.68)
 "At first glance our 1992 performance looks disappointing," explained Chairman and Chief Executive Officer Dennis J. Gormley, "but closer inspection reveals a much brighter picture. Excluding the effects of the restructuring charge and accounting change, earnings from our core operations exceeded market expectations. In fact, 1992 represents the best fourth-quarter performance since 1988.
 "Additionally, through the efforts of our employees," he continued, "we reduced inventory during 1992 by more than $24 million and continued to implement significant process changes across the organization."
 The integration of the TRW and Federal-Mogul aftermarket businesses is proceeding smoothly and is on schedule to essentially be completed before the end of 1993.
 "Many factors contributed to these improvements," Gormley continued. "Sales in the fourth quarter, traditionally our slowest period, were stronger than usual in the North American original equipment market. Aftermarket sales in North America, including the newly acquired TRW product lines, also reflected significant improvement. Sales to our international aftermarket remained strong throughout the year, and we expect this strength to continue."
 In other action, the board of directors declared the regular quarterly dividend of $.12 per share on the common stock of the company and $.96875 per share on the Series D convertible exchangeable preferred stock. Both dividends are payable March 10, 1993, to shareholders of record at the close of business on Feb. 23, 1993. This is the 228th consecutive dividend paid on the common stock of the company.
 Headquartered in Southfield, Federal-Mogul is a global distributor and manufacturer of a broad range of precision parts primarily for automobiles, light trucks, heavy trucks, and farm and construction vehicles. It operates 34 plants, more than 70 distribution centers and four major research centers around the world.
 FEDERAL-MOGUL CORPORATION
 CONDENSED OPERATING RESULTS
 Quarter and Year Ended Dec. 31
 (Millions of Dollars, Except Per-Share Data)
 Quarter Ended Year Ended
 1992 1991 1992 1991
 Revenues
 Net sales $358.1 $266.7 $1,264.0 $1,098.7
 Other income 1.8 .6 7.9 7.2
 359.9 267.3 1,271.9 1,105.9
 Costs and Expenses
 Cost of products sold 295.4 225.7 1,054.6 919.2
 Selling, distribution and
 administrative expenses 49.9 35.0 169.2 152.7
 Net interest expense 4.2 5.6 19.3 22.9
 International currency
 exchange losses 2.2 2.0 5.8 4.8
 Restructuring charge 14.0 25.0 14.0 25.0
 365.7 293.3 1,262.9 1,124.6
 Earnings (loss) from
 continuing operations
 before income taxes (5.8) (26.0) 9.0 (18.7)
 Income taxes (2.2) (1.7) 4.6 1.1
 Earnings (loss) from
 continuing operations (3.6) (24.3) 4.4 (19.8)
 Cumulative effect of change
 in accounting method,
 net of taxes 0.0 0.0 (88.1) 0.0
 Discontinued operations,
 net of taxes 0.0 16.2 0.0 16.1
 Net loss ($3.6) ($8.1) ($83.7) ($3.7)
 Per Common Share:
 Continuing operations ($.26) ($1.12) ($.01) ($1.03)
 Cumulative effect of
 accounting change .00 .00 (3.93) .00
 Discontinued operations .00 .73 .00 .72
 ($.26) ($.39) ($3.94) ($.31)
 FEDERAL-MOGUL CORPORATION
 CONDENSED BALANCE SHEET
 (Millions of Dollars)
 Dec. 31 Dec. 31
 1992 1991
 Assets
 Current Assets
 Cash and equivalents $19.1 $44.6
 Accounts receivable 171.8 154.0
 Inventories 267.4 160.2
 Prepaid expenses and other 42.1 50.5
 Total current assets 500.4 409.3
 Property, plant and equipment 390.7 393.3
 Business investments and other assets 196.9 97.3
 Total Assets $1,088.0 $899.9
 Liabilities and Shareholders' Equity
 Current Liabilities
 Short-term debt $69.4 $47.5
 Accounts payable and accrued liabilities 214.2 166.0
 Total Current Liabilities 283.6 213.5
 Long-term debt 350.6 304.0
 Deferred taxes, pensions and other
 liabilities 82.1 123.4
 Postretirement benefits other than pension 143.3 ---
 Total Liabilities 859.6 640.9
 Shareholders' equity 228.4 259.0
 Total Liabilities and Shareholders'
 Equity $1,088.0 $899.9
 FEDERAL-MOGUL CORPORATION
 CONDENSED CASH FLOWS
 Year Ended Dec. 31
 (Millions of Dollars)
 1992 1991
 Cash Provided From Operating Activities $64.8 $47.9
 Cash Provided From (Used By)
 Investing Activities:
 Expenditures for property, plant
 and equipment (50.2) (44.0)
 Acquisition of TRW Inc.'s automotive
 aftermarket business (214.9) ---
 Proceeds from sale of business --- 146.6
 Other (9.8) (2.5)
 Cash Provided From (Used By)
 Investing Activities (274.9) 100.1
 Cash Provided From (Used By)
 Financing Activities:
 Issuance of Series D preferred shares 76.6 ---
 Net increase (decrease) in debt 74.1 (105.5)
 Sale of accounts receivable 55.0 ---
 Dividends paid to common shareholders (10.7) (20.5)
 Dividends paid to preferred shareholders (6.0) (4.8)
 Other (4.4) .5
 Cash Provided From (Used By)
 Financing Activities 184.6 (130.3)
 Increase (Decrease) in Cash
 and Equivalents (25.5) 17.7
 Cash and Equivalents at Beginning
 of Period 44.6 26.9
 Cash and Equivalents at End of Period $19.1 $44.6
 -0- 2/3/93
 /CONTACT: Lonnie Ross of Federal-Mogul Corporation, 313-354-9934/
 (FMO)


CO: Federal-Mogul Corporation ST: Michigan IN: AUT SU: ERN

JG-MS -- DE007 -- 2344 02/03/93 11:34 EST
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