Westinghouse Profit Drops 94%; CBS’ Summer Ratings Blamed

Westinghouse Electric Corp., walloped by lower CBS ratings during NBC’s broadcast of the Summer Olympics and weaker non-media businesses, said Monday that third-quarter profit fell 94%.

The decline comes as Westinghouse moves closer to announcing its plan to split broadcasting from its slumping $5.5-billion industries and technology group, probably into two publicly traded companies, analysts said.

Pittsburgh-based Westinghouse said profit from continuing operations plunged to $2 million, or break-even results on a per-share basis, from $33 million, or 6 cents a share, a year ago.

“Television dragged its heels a bit in the third quarter,” said Nicholas Heymann, an analyst at NatWest Securities Corp. “CBS ratings are up in the fall season, so that should help fourth-quarter results.”

The poor showing was in line with analysts’ expectations of a loss of 1 cent a share, based on the average estimate of six analysts polled by First Call.

Westinghouse shares fell 12.5 cents to $17.25 on the New York Stock Exchange.

The company said its CBS network and television stations were hurt by the ratings decline during the Olympics, lower advertising rates and the cost of covering the presidential conventions.

A 28% decline in earnings at Westinghouse’s government unit, which manages former nuclear weapons sites, and a $6-million loss at the communications and information systems unit also cut earnings.

Revenue from continuing operations rose 59%, to $2.04 billion from $1.28 billion. The surge reflected last November’s $5.4-billion acquisition of CBS Inc. and higher sales of advertising time at radio stations.

Investors generally shrugged off the results as they await word on Westinghouse’s separation plan. A company spokesman said the announcement will come before the end of the year.

The plan to separate its broadcasting and industrial operations could be considered at a special meeting of the board today.

“It’s our understanding the directors are going to consider the separation plan,” analyst Heymann said.

Executives at Westinghouse and CBS declined to comment on the agenda.