The effects of a major corporate restructuring helped cut Fairchild Industries Inc.'s profit 94 percent in the third quarter, the Chantilly aerospace and electronics company said yesterday.
Fairchild posted a profit of $463,000, compared with a profit of $7.7 million in the third quarter last year. The company lost 15 cents on a per-share basis in the quarter because of a deduction from net earnings to pay a dividend on its series A preferred stock. A year ago, its per-share earnings were 32 cents.
Revenue increased 4 percent in the third quarter, to $113.8 million, compared with revenue of $108.6 million for the same quarter a year ago.
For the first nine months of the year, Fairchild's profit fell 65 percent, to $22.5 million (94 cents) from $63.7 million ($3.28) last year. Revenue fell 2 percent, to $330.6 million from $337.4 million for the nine months last year.
Fairchild attributed the decline in profit to discontinued operations and extraordinary items related to taxes. The company has gone through a major restructuring following a downturn in the aircraft manufacturing business and the cancellation of a $3.5 billion Air Force contract to build the T-46A jet trainer. Discontinued operations include certain aircraft and general industry operations that have been or will be sold by the end of the year, the company said.
Geico Corp., the Washington-based insurance company, said yesterday that its profit rose 18 percent in the third quarter, to $61 million ($3.65 a share) from $51.6 million ($3.02) a year ago. Each year's figures include more than $16 million in gains from investments.
Profit for the first nine months rose 10 percent, to $165.2 million ($9.85) from $150.5 million ($8.65) a year ago, with changes in tax law accounting for part of the nine-month increase. Operating earnings were up even more sharply in the nine-month period, to $112 million from $86 million.
The company said it sold $140 million in common stock investments during the third quarter, shifting much of the money into government securities and adjustable-rate preferred stocks. But Geico said the stock market plunge in late October was likely to "produce negative common stock investment returns" this year. However, it added, strengthening in fixed-income investments during October will somewhat offset the losses.