Goodyear’s Quarterly Profit Skyrockets

Goodyear Tire & Rubber Co. said Tuesday that its earnings soared by more than $105 million in the fourth quarter as it benefited from the sale of some non-tire assets.

The tire maker’s profit climbed despite the recession, which has dampened demand for tires and other automotive products.

Fourth-quarter earnings rose to $105.1 million, or $1.65 a share, from $11.6 million, or 20 cents a share, a year earlier. Sales dropped to $2.78 billion from $2.81 billion in the fourth quarter of 1990.

For the year, the company earned $96.6 million, or $1.61 a share, contrasted with a loss of $38.3 million, or 66 cents a share, in 1990. Sales fell to $10.91 billion from $11.27 billion in 1990.

Goodyear’s stock price rose $1 to $61.375 on the New York Stock Exchange.

The company said a sharp cut of $1 billion in its debt load also buoyed earnings.

“Our efforts to contain selling, administrative and general costs continued to yield positive results,” said Chairman Stanley Gault. “Other favorable influences were lower raw material costs and efficiencies gained through restructuring.”

The company said that in December it sold its polyester plant in Scottsboro, Ala., for about $95 million.

A Goodyear official said the company will sell another polyester plant in Point Pleasant, W.Va.

Other non-tire assets up for sale include foam and packaging facilities in Carrollton, Ohio, and Calhoun, Ga.

Goodyear said it slashed its debt by $1 billion--to $2.6 billion at the end of 1991. It plans to bring debt below $2 billion. The reduction was due to an offering of 12 million shares in the fourth quarter.

Goodyear said the debt reduction resulted in a year-end debt-to-equity ratio below 50% for the first time since 1985.

The 1991 results included a charge of $16.5 million from the sale of the Scottsboro plant.