PRESS RELEASE

Goodyear Announces Q4, 1996 Results

5 February 1997

    AKRON, Ohio, Feb. 5 -- The Goodyear Tire & Rubber Company has
achieved its 23rd consecutive quarter-to-previous-year-quarter improvement in
earnings from operations, the company announced today.
    The company also announced one-time charges totaling $872.5 million
($572.2 million after tax or $3.68 per share) in the fourth quarter including
a $755.6 million write-down of its All American Pipeline and other one-time
costs associated with rationalization of worldwide operations.
    Goodyear Chairman and Chief Executive Officer Samir G. Gibara said the
company's fourth quarter income, before the one-time charges, was $164 million
or $1.05 per share, a 12 percent increase compared with net income of
$146.4 million or 96 cents per share in the 1995 quarter.  Fourth quarter
sales were $3.27 billion, a slight increase over the 1995 quarter.  The 1996
fourth-quarter net, including the effect of the special one-time charges, was
a loss of $408.2 million or $2.63 per share.
    Goodyear's worldwide tire unit sales during the quarter increased
7.2 percent over 1995, led by strong performances in the international
regions, Gibara said.
    Also before one-time charges, 1996 earnings for the year were
$674.7 million or $4.35 per share compared with $611 million or $4.02 per
share in 1995.  Total year sales were $13.11 billion compared with
$13.17 billion in 1995.  Net income for the full year, including the one-time
charges, was $101.7 million or 66 cents per share.
    Revenues were impacted adversely by competitive pricing pressures around
the world and an unfavorable translation of international currencies due to
the strengthening of the U.S. dollar.
    Yesterday, the Board approved a three-year $600 million stock buy-back
program designed to give Goodyear better flexibility in funding its
acquisition program and to optimize shareholder value.  "The company's strong
cash flow position has convinced the Board of the timeliness of this
decision," Gibara said.
    Cash flow from operations was more than $550 million for the quarter and
for the total year, $900 million, up from $653 million in 1995.
    Fourth quarter cost of goods sold was 76.5 percent to sales compared with
76.4 percent in 1995.  For the year, cost of goods sold decreased to
76.5 percent of sales from 76.7 percent in 1995.  Cost of goods sold in 1996
benefitted from lower material costs but was affected adversely by the
adjustment of production schedules to better reflect market requirements.
    Selling, administrative and general expense during the quarter decreased
to 15.1 percent of sales from 15.5 percent in 1995, and for the year, was down
to 14.4 percent compared with 14.7 percent in 1995.  The improvement reflected
the company's ongoing cost containment efforts.
    Global capital expenditures in the 1996 fourth quarter were
$212.1 million, compared with $242.1 million in 1995.  For the year, worldwide
capital expenditures were $617.5 million compared with $615.6 million in 1995.
Nearly 60 percent of 1996 capital expenditures was used to further the
company's global growth and productivity initiatives versus nearly 50 percent
in 1995.
    Depreciation expense was $105.6 million for the quarter, down from
$113.7 million in 1995.  Depreciation expense for the year was $460.8 million
compared with $434.9 million in the 1995 period.
    In 1996, the company completed and announced acquisitions for the year
totaling more than $330 million.  "We completed four strategic acquisitions in
a little over 12 months,  an accomplishment unprecedented in the company's
history, and these investments were financed through our free cash flow,"
Gibara said.
    "A year ago, we unveiled our corporate objectives and strategy for our
mission into the 21st century," said Gibara, speaking to a group of financial
analysts in New York.  "We have made substantial progress toward the company's
strategic goals, and our newly restored financial strength is providing us
with the flexibility needed to aggressively position Goodyear for the future."
    During the fourth quarter, Goodyear adjusted the accounting value of its
oil transportation segment with its economic value based on probable future
cash flows, resulting in a charge of $755.6 million ($499.3 million after tax
or $3.21 per share).  Gibara said the write down will enable Goodyear to more
accurately evaluate future prospects for maximizing the value of the oil
transportation segment through operations or other alternatives.
    For the year, Goodyear also recorded charges of $148.5 million
($95.3 million after tax or 62 cents per share) related to rationalization of
production, worldwide work force reductions and consolidation of operations to
position the company to be more cost competitive.  Included in the charges are
costs associated with the closing of the tire manufacturing facility in
Greece and the discontinuance of PVC production at Niagara Falls, N.Y.
    The company also recorded net gains totaling $32.1 million ($21.6 million
after tax or 14 cents per share) related to the sale of business property in
Asia, a portion of an investment in an Asian plantation and the loss on the
anticipated sale of a U.S. manufacturing facility.

SOURCE  Goodyear