AKRON, OHIO -- Goodyear Tire & Rubber Co. today reported net income of $142 million (70 cents per share), the company's highest quarterly result since the third quarter of 1998, reflecting record net sales and strong operating results in the company's tire businesses.

The quarterly results were up substantially from the prior-year period, when the company recorded net income of $38 million (20 cents per share). All per share amounts are diluted.

Record quarterly sales of $5 billion were a 7 percent increase from $4.7 billion during the 2004 period. The company said growth in sales reflects improved pricing and product mix in each of the company's businesses, higher volume in its international tire businesses, and the favorable impact of currency translation.

Third quarter tire unit volume increased to 58.4 million units, compared to 57.4 million units in the 2004 period, a 1.8 percent gain. Third quarter total segment operating income increased 21.3 percent to $330 million.

"All six of our business units achieved third quarter sales records, and all of our tire businesses achieved improvements in segment operating income compared to last year," said Chairman and CEO Robert Keegan. "This improvement, including a second consecutive $5 billion sales quarter, is further evidence that we are executing to our plan," he said. "Specifically, we are winning through our strategy of focusing on high margin market segments and bringing higher-margin, differentiated new products to market quickly. Our new-product focus was highlighted during the quarter by the introduction of the Goodyear Fortera featuring TripleTred technology in North America, the Dunlop Wintersport 3D in Europe and the early European success of the Goodyear UltraGrip 7 winter tire."

Keegan said the strategy to focus on enhancing the company's brand and product mix, together with increased pricing, enabled Goodyear to offset the impact of higher raw material costs, which increased approximately $148 million compared to the third quarter of 2004.

Goodyear's third quarter 2005 results include after-tax charges of $10 million (5 cents per share) related to hurricanes Katrina and Rita. Goodyear said the effects of these hurricanes in North America principally have involved temporary reductions in production at its North American Tire facilities due to disruption in the supply of certain key raw materials. The company's tire plants returned to normal production levels in mid October and its Beaumont, Texas, chemical plant is operating at near capacity. The continuing impact of the hurricanes could result in future raw material shortages, which could cause intermittent reductions in production, although none are expected at this time.

"I am extremely pleased with the way our Business Continuity team and our plant associates managed through the difficult circumstances surrounding Hurricane Rita," Keegan said. "Outstanding planning and execution helped minimize the financial impact and kept our products flowing to our customers."

In addition to the hurricane-related charge, Goodyear's third quarter 2005 results include an after-tax charge of $8 million (4 cents per share) for rationalizations. The quarter also included after-tax gains of $25 million (12 cents per share) related to the sale of the company's Wingtack adhesive resins business, and $14 million (7 cents per share) from an insurance settlement.

Third quarter 2004 results include net after-tax charges of $32 million (15 cents per share) for rationalizations and accelerated depreciation, and $9 million (4 cents per share) related to an accounting investigation and external professional fees associated with Sarbanes-Oxley compliance. The quarter also included a favorable $44 million (21 cents per share) tax adjustment related to the settlement of prior-year tax liabilities.

The company anticipates continued year-over-year gains in operating performance in the fourth quarter, however the rate of those gains is expected to be less than in the third quarter.

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