Goodyear loses $1.1 billion
AKRON, Ohio (AP) – Goodyear Tire & Rubber Co. lost $1.1 billion in the fourth quarter and for all of 2002, its biggest losses ever due to a large previously-disclosed charge, but said Thursday its recent debt refinancing deal would enable it to do better. “With new bank agreements now in place, we have the financial resources and stability necessary to support our turnaround,” said Robert J. Keegan, president and chief executive.
The world’s largest tire company lost $1.1 billion, or $6.30 per share, in the fourth quarter that ended Dec. 31 in contrast to a loss of $174 million, or $1.07 per share, a year earlier.
Sales rose to $3.53 billion from $3.47 billion in the fourth quarter of 2001.
The results had been expected. Goodyear said last month it would take a $1.1 billion fourth-quarter charge for deferred tax assets and tipped its hand on the size of the loss in a securities filing late Tuesday.
The company’s international operations continue to improve but business in North America remains weak, the company said.
The release of Goodyear’s financial results was delayed as Goodyear worked on replacing $2.94 billion in financing with $3.3 billion in secured credit.
Company officials say newly arranged financial flexibility will help, but analysts remain concerned about a $5 billion debt load.
For 2002, Goodyear lost $1.1 billion, or $6.62 per share, on sales of $13.85 billion. In 2001, the company lost $203.6 million, or $1.27 per share, on sales of $14.15 billion.
Goodyear’s previous largest full-year loss was $658 million in 1992.
The per-share figure for the full year was larger than for the fourth quarter because Goodyear had fewer shares outstanding on average for the year than it did for the quarter.
Goodyear sold 214.3 million tires last year, down 5 million tires, or 2.3 percent.
In January, Keegan replaced Samir G. Gibara as chief executive. Gibara’s six-year tenure coincided with an 80 percent drop in the company’s stock price.
The company makes tires, engineered rubber products and chemicals in more than 90 facilities in 28 countries.
Goodyear employs about 92,000 people.
In morning trading on the New York Stock Exchange, Goodyear shares were up 19 cents, or 3.5 percent, to $5.60.
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