TRW Reports a Profit for Fourth Quarter, All of ’86

TRW Inc., one of the nation’s leading defense contractors, on Wednesday reported fourth-quarter earnings of $45 million, in contrast with a loss of $28.8 million for the year-earlier period as sales rose 5%.

TRW’s board of directors recommended a 2-for-1 split of the company’s common stock, which yesterday closed at $101.125 on the New York Stock Exchange, the company announced.

The recommendation is subject to approval by two-thirds of the company’s shareholders, with the vote to be announced at the company’s annual meeting in Cleveland on April 29.

The company attributed the turnaround to a financial restructuring and renewed attention to its most promising markets and products, and said it expects double-digit growth in earnings per share for all of 1987.

Revenue for the three months ended Dec. 31 rose to $1.55 billion from $1.48 billion in 1985.

For all of 1986, earnings amounted to $217.7 million in contrast with a loss of $7.1 million a year earlier.

Revenue rose 2% to $6.04 billion from $5.92 billion a year earlier.

The company said record contract awards last year led to a record backlog going into 1987 that should lead to double-digit growth in earnings per share.

“Although quarterly comparisons between 1987 and 1986 may be unfavorable in the first half, TRW expects significant growth in earnings per share for the full year,” the company said.

It said plans are being developed to reduce further its range in the electronic component and automotive markets, but that these changes will be accomplished without net charges to earnings.

Fourth-quarter sales for the company’s electronics and space systems segment rose 7% to $890 million from $860 million a year ago.

Operating profit was $87.2 million, in contrast with a $25.5-million operating loss a year earlier, reflecting an upward trend in sales of defense electronics, spacecraft and information systems.