Employees at Geneva Steel shared in an $8.9 million profit-sharing distribution Thursday.
Some 2,400 employees received profit-sharing checks, which averaged $3,000, according to Geneva spokeswoman Mary Kay Lazarus.Geneva gave employees the option of collecting $400 of their profit-sharing money in $2 bills; about $1 million worth of the bills were given to employees. As many as 200 merchants in Utah County are participating in a "two-buck bonanza" - offering merchandise coupons that can be used along with the $2 bills.
This year's profit-sharing total is $3 million lower than last year. That's because Geneva's profits are down about 25.8 percent and capital expenditures on plant modernization projects are up.
In fiscal year 1990, which ended in August, Geneva had net sales of $516.9 million, down from $521.8 million in 1989. Geneva, like other steel companies, reduced its product prices late in fiscal 1989 due to reduced demand for steel products and increased competition.
During 1990, Geneva spent approximately $53 million on modernization and capital maintenance projects.
Under the terms of its labor agreement, Geneva is allowed to deduct 25 percent of the first $50 million of capital expenditures and 30 percent of all additional capital expenditures during each year prior to contributing 10 percent of earnings before taxes and extraordinary items to the profit sharing pool.
In 1988, profit sharing payments totalled $10.2 million; in 1989 the total was $11.9 million.