The Akron Beacon Journal from Akron, Ohio • Page 8

1RUSIN THE BEACON JOURNAL SATURDAY. JAN. 28, 1989; A8 Edison takes ion lo $284 mill ss on By Robert Fernandez Beacon Journal business writer $188 million; Friday's agreement tagged another $49 million onto that sum. 'J The Perry 1 unit cost $5.6 billion Jo, build, and Edison's customers received a 10.6 percent rate increase last year to cover part of its construction costs. The agreement also disallows $47 mil: lion from the construction of Beaver Vah ley 2, located west of Pittsburgh in Ship-: pingport, Pa.

Through an agreement reached with the PUCO last year, Edisen will not receive a rate increase for the! Beaver Valley 2 unit until 1990. The Pennsylvania nuclear unit cost $4.6 oil-; lion to build. $1.22, from $2.06 a share. It was unclear Friday whether the company has taken any write-offs for the disallowances al-. ready.

Edison's news release Friday stated that the write-offs do "not affect Edison's cash position or its ability to maintain dividends at current levels." It is unclear exactly how the disallowances will affect Edison's next request for an electricity rate increase. Money found to be imprudently spent during the construction of a power plant is not allowed to be recouped by utilities through rate increases. be that we'll have to stretch even more to maintain that kind of performance." Edison's stock finished trading Friday at 20, up Yg. The announcement on the write-off was made after financial markets closed. Along with a write-off, Edison agreed to drop certain appeals related to the disallowances that are now before the Ohio Supreme Court.

PUCO spokeswoman Debbie Vivalo said that the disallowances include $237 million for Perry 1 unit, which is located east of Cleveland in North Perry. The PUCO had approved a disallowance of Ohio Edison President Justin T. Rogers Jr. said in a statement: "Write-offs are always difficult to accept, but we believe this agreement addresses the interests of all parties as effectively as possible. It also bring an end to uncertainties regarding our write-off exposure." "By closing this matter, we will be able to focus more sharply on the things we do best and can best influence sales and customer service," Rogers said.

"We served a record peak demand and made record kilowatt-hour sales in 1988. The impact of this settlement will Ohio Edison officials announced Friday that they reached an agreement to accept a $284 million charge for funds mismanaged during the construction of two nuclear power plants. The agreement concerning the Perry 1 and Beaver Valley 2 nuclear plants was reached with the staff of the Public Utilities Commission of Ohio. It now must be approved by the PUCO commissioners. If approved, Akron-based Ohio Edison would take a huge write-off and adjust downward its 1988 earnings per share to 1 1 raciia ge unit boost ives mi to Roadway Services Inc.

By Peter Geiger Beacon Journal business writer 87 Qlr. to Dee. 31 88 If "IT 1 1 f. fcUa if ixr f. 4 life" mTv, i- 'sc3mc Timken profits surge Sales record set in 1988 Citing increased sales volume, Timken Co.

of Canton Friday reported earnings of $24.8 million, or 88 cents a share, for the fourth quarter ended Dec. 31. That was up from $8 million, or 30 cents a share, for the same period in 1987. The company said sales totaled $409 million in the period, up 22 percent from $334 million a year ago. For the year, sales reached a record $1.55 billion, up 26 percent from $1.23 billion in 1987.

Earnings for the year totaled $65.9 million, or $2.34 a share, up from $10.3 million, or 39 cents a share, in 1987. Timken said in a statement that although prices were affected by competitive conditions, the company benefited from "some upward price movement." Sherwin-Williams Co. Sherwin-Williams Co. of Cleveland reported fourth-quarter earnings were down 4 percent to $18.7 million, or 43 cents a share, from $19.5 million, or 44 cents a share, a year ago. Sales were up 9 percent to $445 million compared with $410 million in the last quarter of 1987.

Earnings for the year were up 4 percent to $101 million, or $2.30 a share, from $96 million, or $2.09 per share, in 1987. Sales during 1988 were up 11 percent to $2 billion from $1.8 billion in 1987. "We expect that raw material costs will increase again in 1989 but are hopeful that the rate of increase will be slower than in 1988," said John G. Breen, chairman and chief executive officer. "We are planning to increase prices in 1989 in an attempt to See EARNINGS, page All Sales $74 1.6 million $614.5 million Earnings $31.8 million $18.7 million Per Share 80 47 12monlht 88 87 Sales $2.2 billion $1.9 billion Earnings $80.2 million million Per Share 1.26 the last quarter.

We expect con-i tinuing improvement in the'jrj margins as they continue to im-( prove efficiency." Fourth-quarter tonnage per; shipping day for the company's) subsidiaries increased 4.6 percent! from last year, which represents' an increase of 7 percent in less-! than-truckload tonnage, ship- ments weighing less than 10,000: pounds each, and a decrease of 1.4 percent in truckload tonnage. Fourth-quarter tonnage perl shipping day for Roadway Ex- press decreased 0.4 percent from' 1987, consisting of a decrease of, 0.5 percent in LTL tonnage and an increase of 0.1 percent in truckload tonnage. Roadway's profits, Drake will be boosted by a 4.9 percent rate increase that is to take affect Feb. 27 by rate-making bureaus across the nation. The bureau rates are those charged by interstate carriers to all but frequent customers, who qualify for discounts.

Roadway stock closed Friday at 30, up V2. During the fourth quarter, the company purchased 768,000 shares of its own stock. "The quarter results were! marked by improved margins at Roadway Express, our principal operating subsidiary, in addition to the positive contributions from the other operating said Joseph M. Clapp, chairman and president. factors included1 better pricing, improved productivity, and lower fuel costs, as well as growth in the company's newer subsidiaries," he said.

Roadway Package System, the Pittsburgh-based division of Akron's Roadway Services earned the first profits of its three-year history in the final fiscal quarter of 1988. "That was an unexpected surprise," said industry analyst Timothy S. Drake of McDonald Co. of Cleveland. "Profits from RPS will definitely help the company this year." RPS earned 6 cents per share for the quarter and had a net loss of 5 cents per share for the year.

Roadway posted fourth-quarter earnings of $31.8 million, or 80 cents per share, up 70 percent from the last quarter of 1987. Earnings a year ago were million, or 47 cents per share. For the year, Roadway earned $80.2 million, or $2 per share, up 59 percent from $50.5 million, or $1.26 per share in 1987. "They did better than anticipated," Drake said. "And 1989 looks like a good year for Roadway, too." RPS was started in 1985 as as business-oriented competitor to United Parcel Service.

It now has terminals and delivery service nationwide. Another Roadway addition is Viking Freight Inc. of Palo Alto, whose purchase was completed in the fourth quarter. After deducting purchase financing costs and the loss of interest income because of the expenditure, Viking contributed one cent per share of profits in the quarter, Roadway reported. "That division will continue to yield profits," Drake commented.

"Tonnage trends are improving despite the fact that tonnage at Roadway Express (the Akron-based division that accounts for more than 80 percent of the company's revenue) slipped in Beacon Journal photoDon Rmh Everything goes Margaret Nabors, owner of the Mustard Seed stores in the area will reopen April 10 as Hills Market in Montrose, Inspects old store fixtures department stores, each with some 175 workers, being sold at the Gold Circle store on West The additions will give Hills nearly 70 stores in Market Street in Akron. Former Gold Circle Ohio and 167 nationwide. ANNUAL GNP GROWTH Economy growth rate best in 4 years Loral says layoffs still are needed Percent change in Gross National Product from previous year, based on constant 1982 dollars. 7.5 68 Hi 1988 I I Up 3 8 5 Sjj 36 34 34 2.5 But Commerce Undersecretary Robert Ortner, briefing reporters about the GNP report, said he believed the growth forecasts used in the Reagan administration budget were realistic. He said some of the sluggishness in the fourth quarter was based on temporary factors that would not last into the new year.

Ortner said there were several positive economic developments during 1988. "We made significant progress in reducing the trade deficit, the unemployment rate dropped to a 14-year low and the stock market began a sustained recovery from its See U.S. ECONOMY, page A12 GNP grew at a lackluster annual rate of 2 percent, the slowest quarterly performance in two years. Weakness in consumer spending and business investment held back growth. The fourth-quarter GNP increase followed a 2.5 percent rise in the July-September quarter.

Many economists predict these trends will intensify this year and will result in sharply lower growth for 1989. That would give President Bush a major headache because his hopes of lowering the budget deficit without an increase in taxes rests on expectations of continued strong economic growth. Associated Press Washington The U.S. economy shook off the effects of the stock market crash and the drought to grow at a robust 3.8 percent in 1988, the best performance in four years, the government reported Friday. The increase in the gross national product, the broadest measure of economic health, was powered by a big improvement in the U.S.

trade deficit and a sharp increase in business capital Investment. The advance occurred even though growth slowed sharply in the final three months of the year. From October through December, the '80 '81 '82 '83 '84 '85 '86 '87 '88 SCXJHCE: Bureau of Economic Analysis Goodyear's Topeka plant expanded for $32 million Loral Corp. officials said Friday that the company could not release details about the expiration of its early-retirement offer, but that regardless of how many salaried employees in the Defense Systems division in Akron accepted, layoffs were still expected to occur. Company spokeswoman Elizabeth Allen said from headquarters in New York that the end of a government-imposed suspension prohibiting the Akron division from receiving new military contracts would not change the need for layoffs.

The early-retirement offer that expired Friday was made to about 500 salaried workers in the division in late December. A 30-day waiting period was then opened for employees to decide whether they wished to accept. Sources said incentives in the plan included adding years to a person's age and time of service at the company in order that employees could gain more lucrative pension and benefits upon leaving. Ms. Allen said the program ap: plied only to Defense Systems and not the other Loral division in Akron, Aircraft Braking Systems.

Before a 12-week strike that took place last year, Loral was estimated to have about 4,200 workers in Akron as the city's second-largest employer. About 1,400 of the workers were in hourly manufacturing operations. Since the strike, the company has not disclosed its Akron employment totals. A A. I 1 "1 t- I Vv I a statement, he said keeping the plant competitive would require efforts of United Rubber Workers members to "make changes." A Goodyear spokesman said he did not know whether the statement meant the company was seeking changes in the labor contract.

The project involves construction of more floor space and installation of new presses, tire-building machines, an extruder and wire-processing equipment. Goodyear said the added capacity is needed to allow it to maintain its position as the leader in market share of medium commercial truck tires. The company said that radials accounted for about 65 percent of the 12 million medium truck tires produced in 1988. That proportion is expected to increase to 70 percent in 1989 and to more than 85 percent by 1993. Goodyear announced Friday that it will invest $32 million at its factory in Topeka, to expand production of radial truck tires.

The company said the expansion would create 100 jobs. The plant employs about 2,000 people in the manufacture of truck tires and off-highway products. Goodyear said a $10.8 million package of tax abatements and job and investment credits "helped tip the scales in favor of the Topeka project at a time of tough competition for capital improvement dollars." Assistance came from the Greater Topeka Chamber of Commerce, the Shawnee County legislative delegation and state, county and city officials, the company said. Plant manager Don Lilya said the investment represented a commitment to make the plant competitive on a global basis. In Beacon Journal phnin Robin Witek Just looking, thank you Ray Anderson of Warren, checks his pro- aboard a 35-foot Island packet boat offered by gram at the Mid-America Boat Show at the Harbor North of Huron, Ohio.

The boat has a International Expo Center in Brook Park while price tag of $113,650 and sleeps seven. 4.