Chrysler Corp., whose sales have been sagging since last autumn, yesterday said it lost $49.7 million in the last three months of 1977 and expects to lose money in the current quarter as well.
Chrysler also announced:
It hopes to maintain its current quarterly dividend of 25 cents a share.
It will have to seek external long-term financing some time this year.
It plans to issue new shares of its common stock for sale to its salaried employes.
The company's executive vice president for finance will be leaving for another job.
For all of 1977, Chrysler had profits of $163.2 million (2.71 a share), off 61 percent from its 1976 profits of $422.6 million (7.02).
Sales last year rose 7 3/4 percent to $16.7 billion from $15.5 billion in 1976.
Chrysler's fourth-quarter loss contrasted with the $119.2 million profits it made in the same period of 1976. Sales rose by 5 percent to $4.2 billion from $4 billion in the 1976 fourth quarter.
Due to substantial costs of new products -- notably its compact, front-well-drive Omni and Horizon models and a new car in France -- the third largest car maker will lose money in the first three months of the year, Chrysler Chairman John Riccardo said.
Riccardo said several negative factors that Chrysler experienced in late 1977 -- notably slow sales and bad weather -- were continuing. Although he did not indicate the firm was modifying its sales projections for 1978, he said Chrysler has cut production schedules in the current three-month period to levels below the 1976 first quarter's.
He said 1977 profits were depressed by a sharp rise in costs for new products, unrecovered costs related to inflation, fewer car sales and a six-week strike at a truck plant in Missouri.
Riccardo also blamed the lower profits in part on Chrysler's lower share of the North American market, which he said reflected cutbacks in engineering and development during the 1974-75 recession.
Despite its weaker performance in 1977, Chrysler plans to proceed with a five-year, $7.5 billion modernization plan for North America and to bring new products onto the market, he said.
Despite its big fourth-quarter loss and predicted earnings over the next two years, Chrysler hopes to maintain its current 25-cent-a-share quarterly dividend rate, Riccardo told a press conference.
He also said he expects Chrysler will have to seek external long-term financing some time this year. He wouldn't say how much might be sought or precisely when it might occur.
The chairman also revealed that Chrysler has drawn down some $150 million from its bank credit arrangement in the past few weeks to help cover costs related to weather-caused production disruption. Riccardo said he hopes to have that short-term borrowing paid off by the end of March, but said additional drawings from the credit line will be made from time to time this year.
The new shares will be made available to salaried employes under a long-standing stock purchase plan. In the past, shares made available to employes under that plan were purchased by the plan's trustee on the open market and Chrysler didn't receive any money from the purchases.
But beginning March 1, Chrysler will issue new shares of its authorized but unissued stock to meet the regular needs of the employe plan. While the change won't affect the amount of stock employes can buy, it means that the money paid for the shares will go into Chrysler's coffers instead of to Chrysler shareholders routinely selling their shares on the open market.
The auto maker said it can't estimate how many new shares it will issue under the procedure. But the company said that last year its salaried employes got 2.463 million Chrysler common shares under the plan's terms.
Chrysler also said it couldn't estimate how much cash would be raised by the new program. But one industry insider described the change as a way to "generate capital out of the payroll." Last year, about $21.6 million from the employe stock purchase fund went for open-market purchases of Chrysler stock.
Riccardo said the departure of executive Gwain H. Gillespie will be "for the good of the company" and Gillespie's own good. Riccardo wouldn't elaborate but insisted Gillespie's departure has nothing to do with Chrysler's current financial problem.
Pepsico Inc., the beverage and food company, yesterday reported that net income for 1977 rose by 22 percent to a record $187.3 million ($2.15 a share) from $153.8 million ($1.80) the previous year.
Sales also climbed to an all-time high of $3.55 billion, up 17 percent from the $3.03 billion recorded in 1976.
In the 1977 fourth quarter, the company earned $49.50 million (57 cents) up from $41.96 million (48 cents) in the year-earlier period. Sales totaled $1.12 billion against $917.19 million.
Donald M. Kendall, chairman and chief executive officer, said: "While all our major lines of business -- except sporting goods -- contributed to the increase in corporate earnings progress in soft drinks was particularly pronounced."
Domestic case sales of soft drinks rose by about 12 percent, "far ahead of the industry as a whole," and overseas sales were even stronger, Kendall said. CAPTION: Picture; Chrysler Corp. Chairman John Riccardo gestures as he announces a $49.7 million fourth-quarter loss and a sharp decline in 1977 profits for the No. 3 auto maker.