Sunbeam’s 1997 ‘Profit’ Was Actually a Loss

Sunbeam Corp. said it suffered an operating loss last year, rather than the turnaround touted by its ousted chief executive, downsizing specialist Al “Chainsaw Al” Dunlap. In restating its results, the maker of small household appliances blamed improper accounting practices during Dunlap’s tenure. Last year’s profit came at the expense of 1996 and the first quarter of 1998, which also were restated. The 1997 results were inflated by $95 million in sales of barbecue grills and other products and operating expenses that were improperly lumped into a 1996 restructuring charge. The company, which has about $2 billion in debt, also said its lenders have agreed to waive loan covenants through April 10 and that it has $275 million in borrowing capability and cash on hand. That helped send Sunbeam’s shares up on hopes that new Chief Executive Jerry Levin will have time to turn the firm around. Sunbeam fired Dunlap in June and later that month confirmed that the Securities and Exchange Commission was investigating its accounting practices. Shares rose $1.19 to close at 7.69 on the New York Stock Exchange.