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Spokane, Washington  Est. May 19, 1883

Morrison Knudsen Posts More Losses

Associated Press

Financially beleaguered Morrison Knudsen Corp. reported another $51.3 million in red ink on Monday - a first quarter loss that pushed its losses over 12 months to more than $400 million.

But President Robert Tinstman pointed out that the two thirds of the January-March loss was from the divestiture of the company’s 65 percent interest in MK Rail Corp. as part of the its plan to shed socalled non-core businesses and refocus on construction and engineering.

The first quarter loss compared to a $9.6 million profit a year earlier and translated into a loss of 60 cents per share of common stock. The per-share earnings during the first three months of 1994 were 22 cents.

But Tinstman, who with Chairman Steve Miller recently negotiated financing that should give the corporation 18 months to regain its financial equilibrium, cited operating income of $6 million for the first quarter and $400 million in new work secured over the winter.

“The numbers for operating income and new work are indications of the operational strength of the company,” Tinstman said in a statement. “Our clients continue to show confidence in our ability to complete projects as MK continues to emerge from its financial difficulties.

“Much remains to be done, and loyal clients and dedicated employees hold the key to our success,” he said.

The Boise, Idaho-based company reported ending the first quarter with a $2.4 billion backlog of work in its core sectors of construction, engineering, mining and environmental restoration, essentially matching the backlog of a year earlier. And it said the backlog of work under its troubled transit operation was down to just over $800 million from $873 million last year.

That transit operation, which ousted Chairman William Agee moved the company into shortly after he took over in the late 1980s, has been at the center of its financial problems. With no prior experience in that area, Morrison Knudsen piled up huge cost overruns, penalties for missed deadlines and write-offs for investments in projects that fell through.

In other earnings reports Monday:

Xerox Corp. said its profit rose 42 percent in the second quarter, driven by productivity improvements and revenue growth from the office equipment maker’s Latin American operations.

For the three months ended June 30, the company earned $238 million, or $2.07 per share. That compares with $168 million, or $1.31 per share, in the same period a year ago.

Second-quarter revenues increased 8 percent to $4.64 billion, up from $4.29 billion a year earlier.

Xerox said income from its core document processing business jumped 52 percent to $254 million, up from $167 million in the second quarter of 1994. Revenues from that operation - which makes copiers, scanners, printers and related software - improved 13 percent to $4.05 billion.

Xerox Chairman Paul A. Allaire said the gain was fueled primarily by productivity initiatives and strong growth in revenues and profits from Latin American operations.

The company trimmed 500 jobs from its world-wide document processing staff in the quarter.