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Goodyear reports fourth quarter 2003 Results and an update on 2004

AKRON, Ohio -- The Goodyear Tire & Rubber Company reported financial results for the fourth quarter of 2003. It al...

AKRON, Ohio — The Goodyear Tire & Rubber Company reported financial results for the fourth quarter of 2003. It also provided details of its outlook for 2004 so far.

Goodyear reported sales of $3.91 billion for the fourth quarter of 2003, an increase of 11.6 per cent from $3.51 billion for the fourth quarter of 2002. Tire unit volume in 2003’s fourth quarter was 52.8 million units, compared with 53.6 million units in the 2002 period.

For the fourth quarter of 2003, Goodyear reported a net loss of $434.4 million ($2.49 per share), compared to a net loss of $1.2 billion ($6.96 per share) for the fourth quarter of 2002.

All seven of Goodyear’s businesses reported improved year-over-year segment operating results during the quarter.

“Our fourth quarter total segment operating income more than doubled compared to the 2002 period, and margins increased in six of our businesses, including North American Tire,” said Robert J. Keegan, chairman and chief executive officer. "We focused on stabilizing our North American Tire business and accelerating the momentum in our other six businesses in 2003, and we look for both market and financial gains in 2004.”

The company’s margins improved through cost reduction actions and higher selling prices, partially offset by an increase in raw material costs of approximately $53 million compared to the 2002 quarter.

First quarter 2004 segment operating results are expected to increase by more than 25 per cent in all of the company’s businesses compared to the prior year period, except Asia, which is expected to post flat segment operating income.

“There is much work to be done, but we are attacking our goals very aggressively. We entered 2004 with a great deal of momentum and with high expectations. We are pleased with the results we are seeing for the first quarter of 2004, which will demonstrate that we are gaining traction in our turnaround initiatives,” said Keegan.

The company also continues to maintain a strong liquidity position, and said cash and available credit lines totaled approximately $2.0 billion on a global basis at March 31, 2004.

Goodyear expects raw material costs to increase by approximately 5 per cent in the first quarter.

During the first quarter of 2004 the company will apply the provisions of FIN 46, a Financial Accounting Standards Board regulation, and expects to consolidate the net assets of South Pacific Tyres Ltd., a tire manufacturer operating in Australia and New Zealand, as well as T&WA, a wheel mounting operation in the U.S. The company does not expect the application of FIN 46 in the first quarter of 2004 to have a material impact on its results of operations, cash flow or financial position.

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