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GENCORP ANNOUNCES CHARGE AGAINST EARNINGS FOR PROPOSED RESTRUCTURING

 GENCORP ANNOUNCES CHARGE AGAINST EARNINGS FOR
 PROPOSED RESTRUCTURING
 FAIRLAWN, Ohio, Oct. 19 /PRNewswire/ -- GenCorp (NYSE: GY) announced today that it will take a charge against earnings of $22 million, or approximately $0.42 per share after taxes, in its fourth quarter to reserve for costs associated with a proposed restructuring of its reinforced plastics business. Due to this charge, the company expects its operating profit and earnings per share for the fourth quarter and full year of 1992 to be below earnings generated in 1991.
 The company's reinforced plastics division is part of GenCorp's automotive segment, which designs and produces vehicle sealing, vibration control and reinforced plastic components for domestic and international vehicle manufacturers. A decline in sales of reinforced plastics components over the past several years has left the division with a substantial amount of excess manufacturing capacity. Under the restructuring plan, reinforced plastics production would be consolidated and available capacity reduced.
 "This decision reflects our need to reduce our ongoing production costs in order to improve the performance of the division," said A. William Reynolds, GenCorp's chairman and chief executive officer. "We are confident that the reinforced plastics business can be a profitable contributor to GenCorp in the future. We will improve the health of our business by achieving a better alignment between demand and our production capacity."
 Reynolds also explained that the company will not feel the full benefits of the restructuring next year. "Because of the timing of the proposed transfer and consolidation of production during 1993, the financial performance of the division will not significantly improve until 1994," he explained.
 In making the announcement, Reynolds indicated that GenCorp's outlook for 1993 is not as optimistic as it had been earlier this year. "Given the current softness in the economy and the continued decline in defense spending, we do not expect any substantial growth in sales and earnings in 1993. Although economic trends and their impact on our markets are unusually uncertain for 1993, it appears to us today that our operating performance next year will be comparable to our expectations for 1992, excluding the reinforced plastics restructuring charge."
 "A more substantial improvement in the economy in 1993 could positively affect our performance, but there is little indication at the present time that a meaningful economic turnaround is imminent. Because of this outlook, we are taking steps to reduce expenses throughout the company and improve our profitability," Reynolds said.
 The reinforced plastics restructuring plan calls for relocation of the division's Corvette body panel production from GenCorp Automotive's Marion, Ind. plant to its newest state-of-the-art facility in Shelbyville, Ind. and in addition, operations at the company's Ionia, Mich., plant would be consolidated.
 Approximately 180 hourly jobs, all in Marion, would be affected by the restructuring. The company has begun discussions with United Rubber Workers Local 466 regarding part of the proposed relocation and its potential effect on the hourly workers.
 GenCorp Automotive also produces vehicle sealing components at its Marion facility. The vehicle sealing business will remain in Marion.
 GenCorp is a technology-based company with strong positions in aerospace, automotive, and polymer products.
 -0- 10/19/92
 /CONTACT: Charles R. Tilden, V.P. Communications, 216-869-4292; or Richard A. Nelson, Investor Relations, 216-869-4411; both of GenCorp/
 (GY) CO: GenCorp ST: Ohio IN: ARO AUT SU:


KK -- CL002 -- 1347 10/19/92 08:17 EDT
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Publication:PR Newswire
Date:Oct 19, 1992
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