Federal-Mogul posts loss, hit by asbestos
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NEW YORK, July 19 (Reuters) - Automotive parts maker
Federal-Mogul Corp. on Thursday posted a second-quarter
loss, as asbestos-related payments totalled $82 million during
the period.
The Southfield, Michigan-based company said it continues to
receive a high volume of new asbestos claims, and the recent
bankruptcies of several companies due to asbestos litigation
are putting further financial pressure on the company.
It also said it continues to face "increasing trial
pressure" from a variety of state jurisdictions, and foresees
more difficulty in enacting laws to control asbestos suits due
to the recent shift to a Democratic majority in the U.S.
Senate.
Federal-Mogul posted a loss of 44 cents a share, excluding
charges, compared with a profit of 65 cents a share last year.
Including items, the loss came to 25 cents per share. Including
items, the company reported a loss of 25 cents a share,
compared with a profit of 65 cents a share a year ago.
Second-quarter sales fell to $1.4 billion from $1.6 billion
last year. Federal-Mogul said the original equipment market
strengthened overall in North America due to product offerings
by European and Japanese car makers, but those manufacturers do
not represent a strong market for Federal-Mogul.
The company said it reduced its inventory by $26 million
and reduced its debt by $29 million in the period, while free
cash flow from operations was about breakeven.
Eight companies, including building materials manufacturer
USG Corp. , have filed for Chapter 11 bankruptcy
protection in the last year and a half. Federal-Mogul is one of
the few remaining companies plagued by asbestos lawsuits that
has not filed for Chapter 11.
The company's shares lost 3 cents to $1.66 in early trade
on the New York Stock Exchange, near the 52-week low of $1.45.
The stock has fallen 28 percent since the beginning of the
year.
REUTERS
Rtr 14:39 07-19-01 |
