Rockwell to Invest $150 Million in Modem Plant : Manufacturing: It plans to re-configure the Newport Beach factory to meet demand for chips.

Rockwell International Corp. said Monday it will invest $150 million in its semiconductor factory here to accommodate demand for its computer modem chips.

The investment, which the company announced in its quarterly earnings report, is aimed at re-configuring the aging Newport Beach modem plant with new manufacturing muscle over the next two years.

The plant has 1,300 employees. The company said it expects to add jobs, but officials would not say Monday how many people the division expects to hire.

The plant makes chips for standard and high-speed modems, which translate digital pulses from a computer to analog signals that can be sent over phone lines. Modems enable people to communicate long distance by computer; growth of modem sales is a key driver for the explosion of on-line communications networks such as Prodigy Services.

Rockwell’s Newport Beach plant is part of its Telecommunications Sector, which reported Monday that it had record operating earnings for the latest fiscal quarter because of sales of high-speed modem chips.

The telecommunications sector helped boost overall earnings. The aerospace and technology giant reported that its profit rose 17% to $149.5 million, or 68 cents per share, for the period ended Dec. 31. That compared to earnings of $127.8 million, or 58 cents a share, for the same period a year earlier. Sales for the company’s first quarter were $2.6 billion, up 4.5% from nearly $2.5 billion a year earlier.

In Monday’s trading on the New York Stock Exchange, Rockwell’s stock gained $1.50 a share to close at a record $39.125.

Rockwell, based in Seal Beach, had announced plans last year to buy a chip factory in Irvine owned by Western Digital Corp. But the two companies scrubbed that deal in October after they failed to reach a final agreement. Western Digital, which needed cash to pay off its bank debt, ultimately sold the factory to Motorola Inc. for $111 million plus the costs of assuming equipment leases.

Rockwell said that the fabrication facility will make eight-inch disks known as semiconductor wafers. The wafers are cut into individual chips, packaged in plastic and installed in electronic circuit cards that can be installed on personal computers.

Besides modem chips, the Newport Beach plant also makes chips for fax machines and cellular telephones.

Rockwell’s Earnings Take Off Rockwell International Corp. posted a profit of $149.5 million, or 68 cents a share, on sales of $2.6 billion for the quarter ended Dec. 31. Dollar amounts in billions, except data per share:

Percent 1992 1993 increase Total revenue $2.489 $2.601 4.5 Net earnings 0.128 0.150 17.0 Earnings per share 0.58 0.68 17.0

Source: Rockwell International Corp.; Researched by JANICE L. JONES / Los Angeles Times