Goodyear loses $221 million, half what analysts predicted

AKRON (AP) — Goodyear Tire & Rubber reported a $221 million loss in the second quarter Thursday as the U.S. auto-industry upheaval and the global recession cut sales 25 percent from a year ago.

The loss was half the Wall Street prediction, and Goodyear said it was seeing early indications of an economic turnaround.

Shares rose 14 percent in trading Thursday.

The Akron-based tire maker said it lost 92 cents per share on sales of $3.9 billion. In the second quarter of 2008, Goodyear earned $75 million, or 31 cents per share, on sales of $5.2 billion.

Excluding one-time charges for plant-closing expenses, asset write-offs and others items, Goodyear lost 35 cents per share.

Analysts polled by Thomson Reuters had expected a loss of 70 cents per share.

For the first six months of 2009, Goodyear lost $554 million, or $2.30 per share, on sales of $7.5 billion, compared with earnings of $222 million, or 91 cents per share, on sales of $10.2 billion in the first half of 2008.

“We are beginning to see some signs of economic stabilization and recovery, although still fragile at this stage and varied around the globe,” said Robert J. Keegan, chairman and CEO.

“Our results strengthened compared to the first quarter as reduced raw-material costs and our strategic actions aimed at our top line, cost savings and cash generation continue to have the desired effect.”

The company launched 19 new products in the second quarter, made $200 million in additional cost cuts and eliminated 1,700 jobs.

Added to 3,800 first-quarter staff cuts, the company has passed its full-year goal of 5,000.

Goodyear, the biggest U.S.-based tiremaker and third-largest globally, operates more than 60 plants in 25 countries and has nearly 70,000 employees.

Shares rose $1.97, or 14.1 percent, to $15.86. Goodyear shares have traded in a 52-week range of $3.17 to $23.10.

On July 14, Goodyear and the United Steelworkers of America extended their national contract until Aug. 15 while contract talks, which began in June, continue.

The three-year contract covers about 10,300 Steelworkers at seven plants in the U.S.