ITT POSTS FOURTH QUARTER EARNINGS INCREASE; FULL YEAR EARNINGS BELOW PRIOR YEAR
ITT POSTS FOURTH QUARTER EARNINGS INCREASE;
FULL YEAR EARNINGS BELOW PRIOR YEAR
NEW YORK, Feb. 11 /PRNewswire/ -- ITT Corporation (NYSE: ITT) announced today that net income and earnings per share for the fourth quarter of 1991 were above those of 1990. Earnings for the full year 1991 were below 1990 levels.
For the fourth quarter ended Dec. 31, 1991, net income was $195 million, or $1.44 per share on a fully diluted basis, compared to the $84 million, or 65 cents recorded in 1990. On a primary basis, net income per share was $1.53 in 1991, compared to 67 cents per share in 1990.
Sales and revenues for the 1991 quarter were $5.4 billion compared to $5.5 billion in the same period of 1990.
Net Income for the full year of 1991 was $817 million, or $6.05 per common share on a fully diluted basis, down from the $958 million, or $6.85 reported in 1990. On a primary basis, net income per share for 1991 was $6.42, compared to $7.28 in 1990.
Sales and revenues for 1991 were $20.4 billion, compared to the $20.6 billion reported for 1990.
The 1991 fourth quarter included after-tax portfolio gains at ITT Hartford and ITT Financial totaling $79 million, or 60 cents per share compared with virtually no portfolio gains in the comparable 1990 quarter. For the full year, 1991 net income benefitted from portfolio gains of $137 million or $1.04 per share compared with $16 million or 12 cents per share in 1990. The net unrealized appreciation at Dec. 31, 1991 in the ITT Hartford property and casualty and ITT Financial bond portfolios amounted to $639 million pre-tax.
The 1990 fourth quarter was impacted by several charges and reserve actions which reduced net income for both the fourth quarter and the full year by $218 million or $1.60 per share. In addition, earlier 1990 quarters were impacted by a charge of $26 million after-tax, or 19 cents per share, for the write-off of ITT Sheraton mortgage loans to a hotel property and by a gain of $139 million after-tax or 99 cents per share on the company's sale of 7 percent of Alcatel N.V. and a gain of $47 million, or 33 cents per share on the sale of ITT's investment in Alcatel Alsthom (CGE).
For the full year, 1991 operating results of three of ITT's four service businesses improved over 1990. Operating earnings at ITT Hartford rose substantially in 1991 reflecting the overall strength of the company which generated higher portfolio gains and investment income and improved domestic underwriting results. ITT Hartford's international operations were, however, adversely affected by negative developments in the United Kingdom. ITT Communications and Information Services turned in another strong performance in 1991 reflecting improved operations at World Directories and higher enrollment at ITT Educational Services. ITT Financial achieved substantially higher operating earnings as a result of receivable growth, lower rates on borrowed funds and higher portfolio gains partly offset by higher provisions for loan losses. ITT Sheraton results were below 1990 primarily due to lower occupancy reflecting reduced travel as a result of the Gulf war and the worldwide recessionary environment.
In terms of ITT's Product companies ITT Defense showed higher earnings despite lower sales due to improved contract performance. ITT Automotive's operating income declined significantly for the year reflecting changing product mix and pricing pressures resulting in lower margins and restructuring costs. ITT's Forest Products operations recorded sharply lower operating earnings reflecting the industry downturn in pulp pricing. ITT Electronic Components had an operating loss for the year due to volume reductions in major units and continued restructuring costs. ITT Fluid Technology results were below last year as a result of lower margins at most units.
While Alcatel's earnings improved for 1991, ITT's equity in Alcatel declined slightly due to our reduced ownership interest as well as the strengthening dollar.
"The extended worldwide recession and the stronger dollar impacted most of our major product and service businesses during 1991, causing the decline in our year-to-year reported income," Rand V. Araskog, chairman, president and chief executive said. "Also, the financial strength of the company, highlighted by our conservative debt levels, encouraged us to make a number of important investments in our businesses and to take necessary restructuring steps. These actions enhance our competitive position and will allow our business groups to capitalize on any upturn in the economy. Earlier, our board of directors expressed their confidence in the corporation's operating income levels, enabling us to weather this difficult business environment, by increasing the dividend on our common stock," the chief executive concluded.
/CONTACT: Jim Gallagher of ITT, 212-258-1261/
(ITT) CO: ITT Corporation ST: New York IN: SU: ERN SH -- NY063 -- 8920 02/11/92 15:38 EST