Goodyear Revises Earnings Downward

Goodyear Tire & Rubber Co. said Monday that it revised downward by $65 million its net income for 1997 to 2003, including $10 million related to an accounting probe of its overseas businesses.

Goodyear said that the probe, announced in December, was completed and that it now could file its delayed 2003 annual report, lifting shares nearly 5%.

Goodyear has revised profits for the six years downward by a total of about $150 million.

Accounting questions surfaced in October when Goodyear said it might trim as much as $100 million from results from 1998 to mid-2003 because of mistakes made when it switched computer systems.

That restatement, later revised down to $84.7 million, is the subject of a Securities and Exchange Commission investigation and doesn’t include the $65 million disclosed Monday.

In December, the company said it found possible accounting problems in its European business unit. It said on Monday that investigation was completed.

Saul Ludwig, an analyst at McDonald Investments, said the $10-million write-off was less than some investors had feared.

Goodyear said its latest revision raised its understatement of U.S. worker compensation claims to $20 million. Also included in the $65 million disclosed Monday was $35 million of new items: $10 million to fixed assets, $8 million to product liability, $7 million to sales among company units and $10 million to other items.

Goodyear has been struggling financially for the last three years as a result of soaring raw material prices, various marketing miscues and the weak U.S. economy. It failed to capitalize on the massive August 2000 recall of some Firestone tires by rival Bridgestone Corp.

Goodyear refinanced its bank debt a year ago, causing the tire maker to delay filing its financial reports, and won some concessions from its unionized workers.

The company said it expected to file its 2003 annual report and its amended 2002 report with federal regulators by mid-May. Because the report will not be filed by April 19, as required in its loan agreements, the company said, it was in discussions with lenders to extend the deadline.

Goodyear shares rose 40 cents to $9.04 on the New York Stock Exchange.