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LUKENS ANNOUNCES EXPECTATION FOR FOURTH QUARTER LOSS

 LUKENS ANNOUNCES EXPECTATION FOR FOURTH QUARTER LOSS
 COATESVILLE, Pa., Jan. 14 /PRNewswire/ -- Lukens Inc. (NYSE: LUC)


today announced that it will report a significant loss in the fourth quarter of 1991, related to the impact of a strike at its main steelmaking facility and traditionally soft fourth quarter markets of its industrial products companies.
 In addition to the operating losses, Lukens' management announced that the company will take fourth quarter charges for non-recurring expenses associated with the write-off of non-performing assets and certain environmental items, in addition to provisions for litigation in the industrial operations groups. Recently announced salaried reductions also resulted in severance accruals, which are reported as one-time corporate expenses for the quarter.
 R. William Van Sant, Lukens' chairman and chief executive officer, indicated that the primary fourth quarter loss will exceed $1 per share, which is significantly more than analysts' estimates for the quarter. For the year, Van Sant said the quarterly loss will significantly reduce net earnings. Lukens had reported per-share earnings of $3.58, or $3.30 fully diluted, through the third quarter, which ended Sept. 28, 1991.
 Commenting on sales for the fourth quarter, the Lukens' chief executive said, "Steel orders improved during the last six weeks of the quarter, although we did lose some plate steel orders because of the strike. In retrospect, we are pleased that the Steel Group did not suffer a significant loss of its growing market share. Compounding the effect of the strike were diminished orders related to the general recession in the steel industry, which has kept transaction prices at the lowest level in five years. Preliminary estimates indicate that ?steel shipments will be 18 percent lower than 1990, while Lukens Steel shipments will be down 7 percent. The plate steel market is estimated to be at 4.2 million tons in 1991, compared to 5 million tons in 1990. We expect 1992 to parallel 1991, with shipments between 4.2 and 4.5 million tons."
 Van Sant said the company's fourth quarter results were impacted by costs associated with maintaining customer deliveries during the 105-day strike at its Coatesville plate steel facility. "Although we were operating the facility, using salaried and temporary replacement workers, the production levels were not equal to our pre-strike rates. We chose to ship additional, lower-value product mix from our Conshohocken rolling mill during the period. This was compounded by extraordinary costs associated with start-up of the struck facility, including extensive training and security expenses. Unusual expenditures related to the strike were approximately $6 million."
 The strike by 1,300 steelworkers at the facility began Oct. 1, 1991; it ended following a ratification vote on the contract by workers yesterday.
 Regarding the Steel Group outlook for the first quarter of 1992, Van Sant said, "While there are some recent indications that the economy is turning around, recovery in the key markets that the Steel Group serves is expected to be slow. The six-year reauthorization of the highway bill will provide an impetus for increased spending, which should translate into orders for plate steel and safety products. In addition, service center inventories are currently at a historically low level. Any resurgence in spending will create orders from service centers." Van Sant further noted that it would be reasonable to assume that the effect of these improvements could be delayed until later in 1992.
 The Lukens chief executive said the delay in authorizing a highway infrastructure bill until late November negatively impacted the markets related to Lukens' Safety Products Group. "However," Van Sant said, "the 1992 outlook for this group is positive. Of the $156 billion authorized by Congress in the Highway Bill, $119 billion is reserved for highway construction and maintenance projects. Funds released to the states should result in orders for construction-zone safety products. The rebuilding of the nation's highway system should create excellent opportunities."
 Fourth quarter results from the companies in the Corrosion Protection Group were impacted by severely depressed pricing for natural gas. "Even though spending is depressed for maintenance and replacement business, large natural gas pipeline projects continue to provide business for the ENCOAT pipe-coating subsidiary," Van Sant said. "The Corrosion Protection Group will report record sales and earnings for 1991."
 Lukens' CEO said project work should continue into 1992 for the Corrosion Protection Group. "Increases will depend on the ability of transmission and distribution suppliers to spend discretionary dollars for new pipelines. If the price of natural gas increases, we would expect higher order rates for coatings. However, we believe it will be difficult to maintain the 1991 record performance under current conditions."
 The Lukens' Diversified Group, comprised of two materials-handling companies, two short-line railroads and a real estate development company, recorded reduced sales and earnings for the quarter. For 1991, the Group will report increased sales and earnings over 1990. Van Sant said the outlook for the diversified group is good for 1992.
 Addressing Lukens' 1992 outlook, Van Sant said, "Performance of the Steel Group is key to the company's results. We envision a continuation of strike-related costs through the first quarter. The costs of re-orienting our workforce, as well as implementing new work rules in the steel facilities, will have a negative impact on earnings. However, in spite of strike-related impacts, we expect the first quarter to be profitable. We anticipate that the second quarter will be reasonably good, which is more indicative of the year ahead, based on a slow recovery by the general economy."
 "We are operating in markets that are expected to have growth trends in this decade. Lukens is well-positioned to take advantage of opportunities in any of our markets. Our financial position is exceptionally strong, with excess cash reserves. Based on current operating rates, expected incremental sales will convert into attractive profit margins.
 "Our long-term goal is to leverage our expertise and assets to achieve continuous improvements in the quality and value of our products and services, while maximizing our financial performance," Van Sant said. "We are committed to expanding our existing steel products business. We will focus our resources on new business opportunities in steel-related niche markets."
 Lukens Inc. is a Fortune 500 company that provides plate steels, pipe-coating services, cathodic corrosion protection services, heavy materials-handling equipment, industrial screening products, and industrial and highway construction-zone safety products.
 /delval/
 -0- 1/14/92
 /CONTACT: W. Evelyn Walker of Lukens, 215-383-2504/
 (LUC) CO: Lukens, Inc. ST: Pennsylvania IN: MNG SU: ERP


KA -- PH025 -- 9608 01/14/92 14:17 EST
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