THE VIRGINIAN-PILOT
Copyright (c) 1996, Landmark Communications, Inc.
DATE: Wednesday, April 24, 1996 TAG: 9604240405
SECTION: BUSINESS PAGE: D2 EDITION: FINAL
SOURCE: BY CHRISTOPHER DINSMORE, STAFF WRITER
LENGTH: Short : 45 lines
Despite a delay in filing paperwork, Tenneco still expects to spin off Newport News Shipbuilding by the end of the year, Tenneco Chairman Dana G. Mead said.
The Greenwich, Conn.-based conglomerate is waiting to decide whether to sell or spin off its energy unit before filing the application with the Internal Revenue Service for a tax-free spinoff of the shipyard.
``The timing is being driven by the decision on energy,'' Mead said. ``The IRS has indicated to us that they'd like just one filing.''
The application should be filed by June 30 and the spinoff completed by the end of the year, said Mead, whose comments came during Tenneco's first quarter earnings announcement on Tuesday.
Newport News Shipbuilding made a $41 million profit in the quarter ended March 31. The big Peninsula shipyard made $44 million in same quarter in 1995.
Last quarter was the sixth consecutive quarter in which earnings slipped compared with a year earlier, but several one-time factors contributed to the slide.
The shipyard took a $2 million charge related to the settlement of its dispute with the owners of the cruise ship Independence, which the yard repaired two years ago, Mead said.
It also had to spend about $8 million on advance materials purchases related to the order for five double-hulled tankers it won in January, Mead said.
The shipyard's revenues increased to $438 million in the quarter, up from $421 million a year earlier.
The yard's order book remained stable at about $4.4 billion as it brought in about $300 million in new orders during the quarter.
Tenneco reported record first quarter income of $495 million thanks in large part to the sale of its remaining 21 percent stake in Case. That's up from $128 million a year earlier, an increase to $2.89 a share from 71 cents.
Revenues rose to $2.7 billion from $2.2 billion. by CNB