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Tenneco Profit Drops 11%; 1,000 Jobs to Be Cut

October 22, 1998|Times Wire Services

Tenneco Inc. said it will cut 1,000 jobs, or about 2% of its work force, after posting an 11% drop in third-quarter earnings because of weakness in its auto parts business. Operating profit fell to $93 million, or 56 cents a share, well below estimates of 64 cents, despite growth in Tenneco's packaging business, which includes Hefty and Baggie plastic bags. Revenue rose 4.9% to $1.92 billion. The company will close some of its 13 manufacturing and distribution centers, in a step-up of a cost-cutting program it outlined in July. It expects the cuts to result in fourth-quarter pretax charges of $95 million to $105 million and savings of about $145 million a year, up from the $100 million it estimated in July. Greenwich, Conn.-based Tenneco also said it expects to make a decision by year-end on whether it will split the company into separate auto parts and packaging businesses. Tenneco's shares tumbled $2.50 to close at $31.31 on the New York Stock Exchange.

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