Tenneco Posts Loss of $246 Million in Quarter
Tenneco, a diversified company with a big stake in the energy business, reported a third-quarter net loss of $246 million that company officials blamed on lower oil and gas prices and discontinued operations.
The loss exceeded the $142 million loss for the same period in 1985.
The Houston-based company also posted $3.3 billion in revenue, down from $3.7 billion in the year-ago quarter.
The quarterly net loss resulted from the difference of a $3-million gain from continuing operations offset by a loss of $249 million related to the previously announced sale of the company’s insurance businesses.
The $3-million income from continuing operations compared to $75 million in the year-ago quarter.
The $249-million loss from discontinued operations compared to $217 million in the 1985 period and resulted mainly from the writeoff of substantially all of its coal gasification and shale oil investments.
“Despite improved operating income in a number of our divisions, we were unable to fully offset the dramatic decline in oil and gas prices,” said James L. Ketelsen, Tenneco’s chairman and chief executive.
Ketelsen pointed out that the company’s cash flow remains strong in spite of lower oil and gas prices.
“It is clear that the company’s earnings will remain under pressure until there is improvement in oil and gas prices. However, our diversification enables us to partially offset the effects of lower energy prices and offers us income opportunities that otherwise would not be available,” Ketelsen said.
The company said it still intends to use most of the $1.5 billion it will generate from the pending sale of insurance businesses and gold mining properties to reduce its outstanding debt.
For the first nine months of 1986, the company’s net loss amounted to $42 million, compared to a loss of $44 million in the 1985 period.
Nine-month revenue totaled $10.9 billion, almost even with the $11.1 billion posted last year.
Nine-month income from continuing operations was $107 million, down from last year’s $126 million. Losses from discontinued operations amounted to $149 million compared to $170 million from last year.
Tenneco is a diversified company with major business in oil, natural gas pipelines, agricultural and construction equipment, shipbuilding, automobile parts, insurance, chemicals, packaging and agriculture and land management.
