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UNOCAL EARNINGS UP 33 PERCENT FOR SECOND QUARTER

    LOS ANGELES, July 26 /PRNewswire/ -- Unocal Corp. (NYSE: UCL) today reported net earnings for the second quarter 1993 of $88 million, up 33 percent from $66 million in the same period a year ago.  Earnings per common share were 33 cents in the second quarter 1993, vs. 28 cents per common share last year.
    Excluding asset sales and other special items (detailed in attached table), operating earnings for the second quarter 1993 were $88 million, vs. $52 million for the same period a year ago.
    For the first six months of 1993, Unocal's net earnings were $99 million, or 34 cents per common share.  This compares with $106 million, or 45 cents per common share for the same period in 1992. In the first quarter of 1993, Unocal recorded a one-time charge of $130 million for the cumulative effect of changes in accounting principles for post-retirement medical benefits and post-employment benefits.  Excluding the effect of accounting changes and other special items, six-months earnings were $186 million, compared with $76 million in 1992.
    Richard J. Stegemeier, Unocal's chairman and chief executive officer, said the improved quarter and year-to-date operating results reflected higher domestic natural gas prices, increased foreign natural gas production, lower worldwide exploration and dry hole expenses, lower interest expense and other cost reductions.  These positive factors were offset partially by lower domestic crude oil and natural gas production and lower foreign natural gas prices.
    The year-to-date results also reflected improved earnings from West Coast refining and marketing operations.
    The company's earnings performance reflects the impact of expense reductions and operating improvements that have been implemented over the past year, Stegemeier said.  He noted that the company was nearly three-fourths of the way toward meeting its goal of $700 million in after-tax proceeds from asset sales.  Through the second quarter 1993, the company had realized proceeds of $519 million after-tax from asset sales under the program announced in April 1992.
    Cash flow from operations, before working capital changes, was $351 million for the quarter, up from $320 million a year ago.  For the six months, cash flow was $714 million, up from $533 million in 1992. The increased cash flow resulted from the improvements in operating results.
    Proceeds from asset sales in the second quarter totaled $226 million, compared with $220 million a year ago.  For the six months, proceeds were $546 million in 1993, up from $325 million last year.  Major asset sales in 1993 include the sale of the company's nationwide Auto/TruckStop system and the Imperial Valley geothermal operations.
    Second quarter revenues were $2.10 billion, down from $2.67 billion in 1992.  Six-month 1993 revenues were $4.42 billion, down from $5.09 billion in 1992.  The lower revenues reflect the effects of the sale of several businesses in 1992 and 1993.
    Capital expenditures for the second quarter were $297 million, up from $242 million a year ago.  For the year to date, capital expenditures were $489 million, about the same as the first six months of 1992.
    Exploration expense for the second quarter totaled $28 million, compared with $46 million in 1992.  Exploration expense for the six months was $55 million, down from $90 million in 1992.
    Second quarter dry hole costs were $10 million, down from $22 million in the same quarter of 1992.  For the six months, dry hole costs were $18 million, compared with $42 million a year ago.
    Petroleum Exploration and Production
    Second quarter 1993 earnings from petroleum exploration and production totaled $113 million, up from $95 million in 1992.  For the six months, reported earnings were $255 million, compared with $195 million a year ago.
    Excluding special items, the segment earned $122 million in the second quarter 1993, compared with $86 million a year ago.  For the six months, the adjusted earnings totaled $242 million, up from $176 million in the same period a year ago.
    The increased second quarter earnings reflect higher domestic natural gas prices, lower exploration and dry hole costs, and higher foreign natural gas production.  These factors were offset partially by lower domestic crude oil and natural gas production and lower foreign natural gas prices.
    The year-to-date results also reflected higher domestic crude oil prices.
    Gross natural gas production from the company's offshore fields in the Gulf of Thailand is expected to drop 150 million cubic feet per day in the second half of the year because of reductions in pipeline allocation caused by new production from an adjacent field being developed by another company.  A new pipeline will begin operation later this year, and production from the Unocal fields is expected to return to near current levels at that time.  Unocal holds an average 75 percent net interest in seven fields in Thailand.  Gross production from these fields averaged 822 million cubic feet per day this year.
    Net worldwide crude oil and condensate production for the second quarter averaged 245,400 barrels per day, down from 254,800 barrels per day in 1992.  The company's worldwide average sales price for crude and condensate was $15.93 per barrel, compared with $16.36 per barrel last year.
    Second quarter daily worldwide natural gas production averaged 1,608 million cubic feet, up from 1,590 million cubic feet a year ago. Unocal's worldwide average natural gas sales price was $2.08 per thousand cubic feet (mcf), compared with $1.78 per mcf the previous year.
    Refining, Marketing and Transportation
    Unocal's refining, marketing and transportation segment recorded earnings of $46 million in the second quarter, up slightly from $41 million a year ago.  For the six months, reported earnings were $94 million, up from $49 million in 1992.
    Excluding special items, second quarter earnings were $32 million, compared with $42 million in 1992.  The adjusted six-months earnings were $80 million in 1993, up from $48 million in 1992.
    The quarter results reflected lower West Coast margins, higher refinery maintenance and lower earnings from the Auto/TruckStop system, which was sold earlier this year.  The six-months results reflected higher West Coast margins and lower losses from the company's Southeast U.S. marketing operations.
    The phase-out of Southeast U.S. marketing and the sale of the Auto/TruckStop network contributed to the decline in petroleum product sales from 437,500 barrels per day in the second quarter last year, to 331,000 barrels per day this year.
    Chemicals
    Excluding special items, the chemicals segment recorded earnings in the second quarter 1993 of $16 million, compared with $15 million a year before.  Year-to-date adjusted earnings were $29 million in 1993, vs. $25 million in 1992.
    Geothermal
    Excluding special items, geothermal earnings for the first half of 1993 were $12 million, compared with $13 million the year before.
    Geothermal energy production averaged 19.5 million kilowatt-hours per day in the second quarter, compared with 22.7 million kilowatt-hours per day a year ago.
    Corporate and Other
    Excluding special items, corporate expenses were $88 million in the second quarter 1993, down from $96 million in 1992.  Six-months expenses were $177 million in 1993, compared with $186 million the year before.
    The improvement reflected lower net interest expense, which was offset partially by higher on-going environmental costs.
                                UNOCAL CORP.
                   1993 Earnings Press Release Supplement
                     Special Adjustments - Consolidated
              (Dollars in millions, except per share amounts)
                                (Unaudited)
                             For the              For the
                       Three Months Ended     Six Months Ended
                             June 30,              June 30,
                          1993      1992       1993       1992
    Reported earnings      $88       $66        $99       $106(a)
    Less special items:
     Cumulative effect of
      accounting changes
      - for postretirement
        health care costs
        (SFAS 106)          ---      ---       (121)        ---
      - for postemployment
        benefits (SFAS 112) ---      ---         (9)        ---
      - for income taxes
        (SFAS 109)          ---      ---        ---          24
     Major asset sales       10       10         57          (1)
     Unusual environmental/
      litigation costs      (10)      (7)       (14)        (14)
     Tax benefit on
      foreign exploration
      expense               ---       11        ---          21
     Total special items    ---       14        (87)         30
    Adjusted earnings        88       52        186          76
    Less: dividends on
     preferred stock          9      ---         18         ---
    Adjusted earnings
     applicable to
     Common shares          $79      $52       $168         $76
    Adjusted earnings per
     common share         $0.33    $0.22      $0.70       $0.32
    (a) Restated for the cumulative effect of an accounting change for
        income taxes.
                                UNOCAL CORP.
                   1993 Earnings Press Release Supplement
             Special Adjustments Allocated by Business Segments
               (Dollars in millions except per share amounts)
                                (Unaudited)
                             For the              For the
                        Three Months Ended    Six Months Ended
                            June 30,              June 30,
                         1993      1992       1993        1992
    U.S. Petroleum
     Exploration and
     Production
    Reported earnings    $66        $40       $153         $73
    Less: major asset
     sales                (4)       ---         18         ---
    Adjusted U.S.
     E&P earnings        $70        $40       $135         $73
    Foreign Petroleum
     Exploration and
     Production
    Reported earnings    $47        $55       $102        $122
    Less special items:
     Major asset sales    (5)       ---         (5)        ---
     Unusual
      environmental/
      litigation costs   ---         (2)       ---          (2)
     Tax benefit on
      foreign exploration
      expense            ---         11        ---          21
      Adjusted foreign
       E&P earnings      $52        $46       $107        $103
    Refining, Marketing
     and Transportation
    Reported earnings    $46        $41        $94         $49
    Less special items:
     Major asset sales    15         (1)        15          (1)
     Unusual
      environmental/
      litigation costs    (1)       ---         (1)          2
    Adjusted RM&T
     Earnings            $32        $42        $80         $48
    Chemicals
    Reported earnings    $16        $26        $28         $25
    Less: major asset
     sales               ---         11         (1)        ---
    Adjusted chemicals
     Earnings            $16        $15        $29         $25
    Geothermal
    Reported earnings     $6         $3        $38         $10
    Less special items:
     Major asset sales   ---        ---         26         ---
     Unusual
      environmental/
      litigation costs   ---         (2)       ---          (3)
     Adjusted Geothermal
      Earnings            $6         $5        $12         $13
    Corporate and Other
     reported earnings  ($93)      ($99)     ($186)      ($197)
    Less special items:
     Major asset sales     4        ---          4         ---
     Unusual
      environmental/
      litigation costs    (9)        (3)       (13)        (11)
      Adjusted corporate
       and other        ($88)      ($96)     ($177)      ($186)
    Total adjusted
     earnings            $88        $52       $186         $76
    Less: dividends on
     preferred stock       9        ---         18         ---
    Adjusted earnings
     applicable to
     common shares       $79        $52       $168         $76
    Adjusted earnings
     per common share  $0.33      $0.22      $0.70       $0.32
                                UNOCAL CORP.
                            Operating Highlights
                                (Unaudited)
                           For the              For the
                     Three Months Ended     Six Months Ended
                         June 30,                June 30,
    Net daily
     production(a)      1993     1992          1993      1992
     Crude oil and
      condensate
      (thousand
      barrels):
      United States    148.2    154.9         150.3     154.9
      Foreign           97.2     99.9          98.8     100.0
       Total           245.4    254.8         249.1     254.9
     Natural gas
      (million cubic
      feet):
      United States      916      954           918       955
      Foreign            692      636           700       619
       Total           1,608    1,590         1,618     1,574
     Natural gas
      liquids (thousand
      barrels)          19.6     19.8          19.6      19.4
     Geothermal (million
      kilowatt-hours)   19.5     22.7          20.8      23.0
    Input to crude oil
     processing units
     (thousand barrels
     daily)            292.3    295.6         285.9     279.2
    Sales of petroleum
     products
     (thousand
     barrels
     daily)(b)         331.0    437.5         355.3     425.8
    Capital
     expenditures
     (millions of
     dollars)            297      242           489       491
    Exploration expense
     (millions of
     dollars)             28       46            55        90
    Dry hole costs
     (millions of
     dollars)             10       22            18        42
    Cash flows from
     operating activities
     (millions of dollars)
     Excluding working
      capital changes    351      320           714       533
     Including working
      capital changes    188      109           493       340
    Cash flows from
     asset sales
     (millions of
     dollars)            226      220           546       325
    Average sales
     prices
     Crude oil and
      condensate
      (per barrel):
       United States  $15.47   $15.90        $14.92    $14.48
       Foreign        $16.82   $17.30        $16.42    $16.61
       Worldwide      $15.93   $16.36        $15.41    $15.16
     Natural gas
      (per mcf):
      United States    $2.07    $1.48         $1.94     $1.60
      Foreign          $2.09    $2.24         $2.03     $2.18
      Worldwide        $2.08    $1.78         $1.98     $1.83
    (a) Includes net profits type agreements on a gross basis.
    (b) Includes the company's 50 percent equity portion of The UNO-VEN
        Co.
                              UNOCAL CORP.
                             Financial Data
                              (Unaudited)
             (Dollars in millions except per share amounts)
                        For the Three Months         For the Six Months
                           Ended June 30,              Ended June 30,
                          1993      1992              1993      1992(c)
    Total revenues(a)   $2,098    $2,673            $4,416    $5,094
    Costs and other
     deductions(a)       1,938     2,553             4,006     4,948
    Earnings before
     income taxes          160       120               410       146
    Income taxes            72        54               181        64
    Earnings before
     cumulative effect of
     accounting changes     88        66               229        82
    Cumulative effect of
     accounting changes    ---       ---              (130)       24
    Net earnings           $88       $66               $99      $106
    Dividends on preferred
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Publication:PR Newswire
Date:Jul 26, 1993
Words:1997
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