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SUNDSTRAND ANNOUNCES ADDITIONAL COST-SAVING ACTIONS AND ADOPTION OF SFAS NO. 106

 SUNDSTRAND ANNOUNCES ADDITIONAL COST-SAVING ACTIONS
 AND ADOPTION OF SFAS NO. 106
 ROCKFORD, Ill., June 17 /PRNewswire/ -- Sundstrand Corporation (NYSE: SNS) announced today that the company will take a pre-tax charge of $34.0 million, equivalent to $.60 per share after taxes, in the second quarter. This charge is being taken to cover the one-time costs necessary to restructure the aerospace segment of the company to reflect an anticipated accelerated decline in military sales and slower growth in commercial sales during the next several years. The charge also will cover costs associated with the integration of the recently acquired Westinghouse Electrical Systems Division with the Sundstrand Electric Power Systems Division.
 The restructuring will be far-reaching with the objective of maintaining Sundstrand's profit margins in the face of lower sales. The restructuring will include both downsizing and consolidation of manufacturing plants as well as aggressive expense reduction programs in all aerospace divisions. Harry C. Stonecipher, chairman, president and chief executive officer, said, "These actions will be painful but necessary to preserve our operating margins in the face of weak aerospace markets."
 The company's earnings also will benefit in 1992 and in the future from a change in pension cost assumptions which more realistically reflect current conditions. This change, although not impacting employees' benefits, will add $3.7 million after taxes, equivalent to $.10 per share, to second quarter earnings and $7.4 million after taxes, equivalent to $.20 per share, to 1992 full-year earnings.
 In addition, the company announced that it will adopt SFAS No. 106, "Employers' Accounting for Post-retirement Benefits Other than Pensions," during 1992, which will require the company to record in the first quarter of 1992, an after-tax cumulative charge of $205 million, equivalent to $5.68 per share. The adoption of SFAS No. 106 will also result in a quarterly after-tax increase in post-retirement benefit costs of $3.3 million, for a full-year effect of $13.3 million, equivalent to $.37 per share. The adoption of this new accounting standard will not impact the company's cash flow.
 Excluding all the items mentioned above, the company expects earnings in the second quarter to be in line with the $.58 per share earned in the first quarter of 1992. Including the items mentioned above, the company expects to report a loss for the full year.
 Sundstrand Corporation, with 1991 sales of $1,669.2 million, is an international market leader in the design, manufacture and sale of a variety of proprietary, technology-based components and subsystems for aerospace (61 percent of 1991 sales) and industrial (39 percent of 1991 sales) markets. Sundstrand's common stock is listed on the New York, Midwest and Pacific stock exchanges.
 -0- 6/17/92
 /CONTACT: Gary Hedges of Sundstrand, 815-226-6245/
 (SNS) CO: Sundstrand Corporation ST: Illinois IN: ARO SU:


LR-PS -- NY081 -- 1287 06/17/92 18:28 EDT
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Publication:PR Newswire
Date:Jun 17, 1992
Words:472
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