Favorable Tax Change Figures in Rockwell’s 26% Income Gain

Rockwell International Corp. on Wednesday reported third-quarter earnings of $214.7 million, up 26% from last year, on sales of $3.1 billion, up slightly from last year’s third quarter when B-1B program sales were $475 million higher.

Donald R. Beall, chairman and chief executive, said: “Our third-quarter results, excluding the favorable tax adjustment, again demonstrate the company is making substantial progress in replacing the decreasing sales and earnings from the B-1B program. Each of the company’s businesses other than aerospace--automotive, electronics and general industries--had more than 20% increases from last year’s third quarter.”

The El Segundo firm reported that income for the first nine months of 1988 was $626 million, up 26%, while sales totaled $8.8 billion, down from $9.1 billion in 1987.

The favorable tax adjustment for the third quarter and first nine months results from B-1B program income, deferred for tax purposes in prior years under the completed contract method, becoming taxable in 1988 at a lower U.S. income tax rate than was used previously to provide related deferred income taxes.

Total backlog was $13.6 billion on June 30, 1988, an increase of 33% from a year earlier. This year’s backlog includes $3.3 billion of commercial orders.