-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, OA1DuzW53Ybch21lqDE7Yz8L4WX94UNkoQFvc+QeJnK0/f5+fA+3Vd4elrmcQgaK JXEB0dY+Av1P7OsY5Gg47Q== 0000716039-99-000004.txt : 19990201 0000716039-99-000004.hdr.sgml : 19990201 ACCESSION NUMBER: 0000716039-99-000004 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19990127 ITEM INFORMATION: FILED AS OF DATE: 19990129 FILER: COMPANY DATA: COMPANY CONFORMED NAME: UNOCAL CORP CENTRAL INDEX KEY: 0000716039 STANDARD INDUSTRIAL CLASSIFICATION: CRUDE PETROLEUM & NATURAL GAS [1311] IRS NUMBER: 953825062 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: SEC FILE NUMBER: 001-08483 FILM NUMBER: 99515869 BUSINESS ADDRESS: STREET 1: 2141 ROSECRANS AVE STREET 2: STE 4000 CITY: EL SEGUNDO STATE: CA ZIP: 90245 BUSINESS PHONE: 3107267600 8-K 1 UNOCAL'S FOURTH QUARTER 1998 EARNINGS SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 FORM 8-K Current Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of report (Date of earliest event reported) January 27, 1999 ------------------------ UNOCAL CORPORATION - -------------------------------------------------------------------------------- (Exact name of registrant as specified in its charter) Delaware - -------------------------------------------------------------------------------- (State or Other Jurisdiction of Incorporation) 1-8483 95-3825062 - -------------------------------------------------------------------------------- (Commission File Number) (I.R.S. Employer Identification No.) 2141 Rosecrans Avenue, Suite 4000, El Segundo, California 90245 - -------------------------------------------------------------------------------- (Address of Principal Executive Offices) (Zip Code) (310) 726-7600 - -------------------------------------------------------------------------------- (Registrant's Telephone Number, Including Area Code) Item 5. Other Events. Fourth Quarter 1998 Results Unocal Corporation announced a preliminary loss of $29 million, or 12 cents per share (basic and diluted), in the fourth quarter of 1998. This compares with earnings of $142 million, or 57 cents per share (diluted), in the fourth quarter of 1997. Depressed crude oil and natural gas prices, asset write-downs, environmental and litigation charges, and a restructuring charge were the major factors in the loss. Earnings from continuing operations, excluding special items (detailed in the attached tables), were $28 million, or 11 cents per share, compared with $134 million, or 54 cents per share (diluted), a year ago. Lower worldwide commodity prices in the fourth quarter of 1998 resulted in an approximate $120 million reduction in after-tax operating earnings compared with the same period a year ago. Other factors affecting operating earnings included lower worldwide crude oil volumes and a provision for Geothermal receivables which was offset by lower dry hole costs. The after-tax special items in the fourth quarter included $65 million in asset write-downs, $30 million in environmental and litigation provisions, and a $17 million restructuring charge arising from workforce reductions. The asset write-downs, in accordance with Statement of Financial Accounting Standards No. 121 - Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to Be Disposed Of, were for various oil and gas and mining facilities, and were primarily the result of forecasted lower commodity prices. The environmental and litigation provisions were due to new information and/or events related to estimated remediation and legal settlement costs for various company operations and former facilities. The restructuring charge resulted from a plan adopted by management in response to depressed commodity prices and primarily represents the cost of terminating approximately 475 employees: 240 in Unocal's mining operations from the suspension of certain mining activities, 95 in various exploration and production business units, and 140 support personnel at various locations. Also included as special items was a $45 million benefit from an insurance recovery for various environmental matters and an $18 million gain from asset sales. The asset sales included the company's interest in the Alliance Pipeline Project and the company's Oklahoma operations. Total revenues for the fourth quarter were $1.48 billion, compared with $1.56 billion in the same period a year ago. Year-end 1998 Results Unocal reported preliminary net earnings for 1998 of $130 million, or 54 cents per share (diluted), compared with $581 million, or $2.31 per share (diluted), in 1997. Year-end 1998 earnings from continuing operations, excluding special items (detailed in the attached tables), were $166 million, or 68 cents per share (diluted), compared with $515 million, or $2.06 per share (diluted), for 1997. Total revenues for 1998 were $5.48 billion, compared with $6.06 billion for 1997. Outlook As a result of forecasted low commodity prices, the company has projected capital expenditures of about $1.0 billion for 1999, compared with $1.7 billion in 1998. The company's capital plan is currently focused on preserving its high-potential deepwater exploration and development programs in the Gulf of Mexico and Indonesia while maintaining its debt ratio below 50 percent. The company expects to drill four to six deepwater exploration wells in the Gulf of Mexico this year and continue its exploration and delineation program on the greater Seno structure in Indonesia. Unocal has also established a goal of reducing annualized cash expenses by $150 million to $200 million from the 1998 level to bolster cash flow. Unocal is a leading global oil and gas exploration and production company with significant pipeline and power plant development projects worldwide. Forward-looking statements and estimates regarding exploration and production activity and business results in this report are based on assumptions concerning market, competitive, regulatory, environmental, operational and other considerations. Actual results could differ materially. 2
UNOCAL CORPORATION CONDENSED CONSOLIDATED EARNINGS STATEMENT (UNAUDITED) For the Three Months For the Twelve Months Ended December 31 Ended December 31 ----------------------- ------------------------- Millions of dollars except per share amounts 1998 1997 1998 1997 - ----------------------------------------------------------------------------------------------------------------------------------- Total revenues .......................................................... $ 1,481 $ 1,557 $ 5,479 $ 6,064 Costs and other deductions .............................................. 1,512 1,375 5,174 5,293 ---------------------------------------------------- Earnings/(loss) from continuing operations before income taxes .......... (31) 182 305 771 Income taxes / (benefit) ................................................ (2) 34 175 102 ---------------------------------------------------- Earnings/(loss) from continuing operations .............................. (29) 148 130 669 Loss from discontinued operations (net of tax) ......................... -- (6) -- (50) Extraordinary charge - extinguishment of debt (net of tax) .............. -- -- -- (38) ---------------------------------------------------- Net earnings/(loss) ..................................................... $ (29) $ 142 $ 130 $ 581 Basic earnings/(loss) per share of common stock (a) Continuing operations ............................................. $ (0.12) $ 0.60 $ 0.54 $ 2.69 Discontinued operations (net of tax) .............................. -- (0.02) -- (0.20) Extraordinary item - extinguishment of debt (net of tax) .......... -- -- -- (0.15) ---------------------------------------------------- Basic net earnings/(loss) per share ..................................... $ (0.12) $ 0.58 $ 0.54 $ 2.34 Diluted earnings/(loss) per share of common stock (b) (c) Continuing operations ............................................. $ (0.12) $ 0.59 $ 0.54 $ 2.65 Discontinued operations (net of tax) .............................. -- (0.02) -- (0.19) Extraordinary item - extinguishment of debt (net of tax) .......... -- -- -- (0.15) ---------------------------------------------------- Diluted net earnings/(loss) per share ................................... $ (0.12) $ 0.57 $ 0.54 $ 2.31 (a) Weighted average shares - basic (millions)......................... 241 245 241 248 (b) Weighted average shares - diluted (millions)....................... 242 259 242 262 (c) Distributions on preferred securities (net of taxes) excluded in $ -- $ 6 $ -- $ 24 numerator. In 1998, the effect of assumed conversion of preferred securities on earnings per share is antidilutive. - ----------------------------------------------------------------------------------------------------------------------------------- CONDENSED CONSOLIDATED BALANCE SHEET (UNAUDITED) Dec. 31 Dec. 31 Millions of dollars 1998 1997 - ----------------------------------------------------------------------------------------------------------------------------------- Assets Cash and cash equivalents .............................................. $ 238 $ 338 Other current assets ................................................... 1,140 1,163 Investments and long-term receivables .................................. 1,153 1,113 Properties - net ....................................................... 5,276 4,816 Other assets ........................................................... 145 100 ------------------------- Total assets .................................................. $ 7,952 $ 7,530 Liabilities and Equity Current liabilities .................................................... $ 1,376 $ 1,160 Long-term debt ......................................................... 2,558 2,169 Deferred income taxes .................................................. 132 137 Other deferred credits and liabilities ................................. 1,162 1,228 Convertible preferred securities of a subsidiary trust ................. 522 522 Stockholders' equity Common stock ........................................................ 712 704 Retained earnings ................................................... 1,935 1,990 Accumulated other comprehensive loss ................................ (34) (18) Less treasury stock at cost (10,623 thousand shares) ................ (411) (362) ------------------------- Total liabilities and equity .................................. $ 7,952 $ 7,530
Table 1
UNOCAL CORPORATION CONDENSED CONSOLIDATED CASH FLOWS (UNAUDITED) For the Three Months For the Twelve Months Ended December 31 Ended December 31 ---------------------------------------------------- Millions of dollars 1998 1997 (a) 1998 1997 (a) - ------------------------------------------------------------------------------------------------------------------------------------ Cash flows from operating activities Net earnings (loss) ..................................... $ (29) $ 142 $ 130 $ 581 Adjustments to reconcile net earnings to net cash provided by operating activities Loss on disposal of discontinued operations (before-tax) -- 10 -- 81 Depreciation, depletion and amortization .......... 301 207 867 962 Dry hole costs .................................... 34 59 184 110 Deferred income taxes ............................. (38) (23) (72) (249) Gain on sales of assets (before-tax) .............. (45) (21) (211) (80) Other ............................................. 17 (27) 35 (110) Working capital and other changes related to operations . 52 50 70 (162) ---------------------------------------------------- Net cash provided by operating activities ......... 292 397 1,003 1,133 Cash flows from investing activities Capital expenditures (includes dry hole costs) .......... (456) (474) (1,704) (1,427) Proceeds from sale of discontinued operations ........... -- -- -- 1,789 Proceeds from asset sales ............................... 136 45 435 100 ---------------------------------------------------- Net cash (used in) provided by investing activities (320) (429) (1,269) 462 Cash flows from financing activities Net increase (decrease) in long-term debt ............... 134 93 419 (866) Dividends paid .......................................... (48) (49) (193) (199) Repurchase of common stock .............................. -- (189) (48) (362) Other ................................................... (3) (1) (12) (47) ---------------------------------------------------- Net cash provided by (used in) financing activities 83 (146) 166 (1,474) Increase (decrease) in cash and cash equivalents ....................... 55 (178) (100) 121 Cash and cash equivalents at beginning of period ....................... 183 516 338 217 ---------------------------------------------------- Cash and cash equivalents at end of period ............................. $ 238 $ 338 $ 238 $ 338 (a) Cash flows related to discontinued operations have not been segregated - ------------------------------------------------------------------------------------------------------------------------------------ CONDENSED CAPITAL EXPENDITURES (UNAUDITED) Millions of dollars - ------------------------------------------------------------------------------------------------------------------------------------ United States Exploration & Production ................................. $ 221 $ 167 $ 810 $ 367 International Exploration & Production ................................. 186 227 762 801 Geothermal and Power Operations ........................................ 4 26 26 102 Diversified Business Group ............................................. 32 19 78 59 New Ventures (Non-E & P) .............................................. -- -- 1 5 Corporate & Unallocated ................................................ 13 35 27 44 Discontinued Operations ................................................ -- -- -- 49 ---------------------------------------------------- Total (b) ............................................... $ 456 $ 474 $ 1,704 $ 1,427 (b) Includes capitalized interest of: $ 4 $ 9 $ 26 $ 35
Table 2
UNOCAL CORPORATION RESULTS OF OPERATIONS FOR EXPLORATION AND PRODUCTION ACTIVITIES (UNAUDITED) For the Three Months Ended December 31, 1998 -------------------------------------------------------------- Spirit Other Millions of dollars Energy 76 Alaska Far East International Total - ------------------------------------------------------------------------------------------------------------------------------------ Sales (includes intercompany sales) Crude oil and condensate .............................. $ 43 $ 25 $ 67 $ 22 $ 157 Natural gas ........................................... 135 15 164 6 320 Natural gas liquids ................................... 8 -- 7 -- 15 Other ................................................. -- -- -- -- -- -------------------------------------------------------------- Total ........................................... 186 40 238 28 492 Other revenue ................................................. 14 4 11 5 34 Gain/(loss) on asset sales (a) ................................ 31 1 (3) (2) 27 -------------------------------------------------------------- Total revenues .................................. 231 45 246 31 553 Production costs .............................................. 56 22 35 11 124 Exploration expenses .......................................... 28 -- 9 23 60 Dry hole costs ................................................ 21 -- 7 -- 28 Depreciation, depletion & amortization (b) .................... 143 35 45 25 248 Other operating expenses ...................................... 9 3 27 3 42 -------------------------------------------------------------- Results of operations before income tax ............... $ (26) $ (15) $ 123 $ (31) $ 51 - ------------------------------------------------------------------------------------------------------------------------------------ For the Three Months Ended December 31, 1997 -------------------------------------------------------------- Spirit Other Energy 76 Alaska Far East International Total -------------------------------------------------------------- Sales (includes intercompany sales) Crude oil and condensate .............................. $ 75 $ 44 $ 111 $ 42 $ 272 Natural gas ........................................... 202 18 157 11 388 Natural gas liquids ................................... 15 1 7 1 24 Other ................................................. 1 -- -- -- 1 -------------------------------------------------------------- Total ........................................... 293 63 275 54 685 Other revenue ................................................. 3 2 5 7 17 Gain on asset sales ........................................... 9 -- -- 1 10 -------------------------------------------------------------- Total revenues .................................. 305 65 280 62 712 Production costs .............................................. 54 20 37 21 132 Exploration expenses .......................................... 22 1 33 20 76 Dry hole costs ................................................ 19 -- 30 -- 49 Depreciation, depletion & amortization (b) .................... 94 11 68 16 189 Other operating expenses ...................................... 21 4 13 12 50 -------------------------------------------------------------- Results of operations before income tax ............... $ 95 $ 29 $ 99 $ (7) $ 216 (a) Includes the gain on the sale of the company's Oklahoma properties. (b) Includes asset write-downs.
Table 3
UNOCAL CORPORATION RESULTS OF OPERATIONS FOR EXPLORATION AND PRODUCTION ACTIVITIES (UNAUDITED) For the Twelve Months Ended December 31, 1998 -------------------------------------------------------------- Spirit Other Millions of dollars Energy 76 Alaska Far East International Total - ------------------------------------------------------------------------------------------------------------------------------------ Sales (includes intercompany sales) Crude oil and condensate .............................. $ 194 $ 102 $ 329 $ 101 $ 726 Natural gas ........................................... 566 62 610 25 1,263 Natural gas liquids ................................... 41 2 16 1 60 Other ................................................. 3 -- -- -- 3 -------------------------------------------------------------- Total ........................................... 804 166 955 127 2,052 Other revenue/(loss) .......................................... 20 10 (6) 19 43 Gain on asset sales (a) ....................................... 32 1 -- 158 191 -------------------------------------------------------------- Total revenues .................................. 856 177 949 304 2,286 Production costs .............................................. 187 82 123 66 458 Exploration expenses .......................................... 75 2 59 56 192 Dry hole costs ................................................ 121 -- 42 21 184 Depreciation, depletion & amortization (b) .................... 410 71 212 68 761 Other operating expenses ...................................... 63 13 70 40 186 -------------------------------------------------------------- Results of operations before income tax ............... $ -- $ 9 $ 443 $ 53 $ 505 - ------------------------------------------------------------------------------------------------------------------------------------ For the Twelve Months Ended December 31, 1997 -------------------------------------------------------------- Spirit Other Energy 76 Alaska Far East International Total -------------------------------------------------------------- Sales (includes intercompany sales) Crude oil and condensate .............................. $ 308 $ 180 $ 453 $ 161 $ 1,102 Natural gas ........................................... 743 65 642 46 1,496 Natural gas liquids ................................... 56 4 25 4 89 Other ................................................. 3 -- -- -- 3 -------------------------------------------------------------- Total ........................................... 1,110 249 1,120 211 2,690 Other revenue ................................................. 10 6 5 23 44 Gain/(loss) on asset sales .................................... 11 -- -- (15) (4) -------------------------------------------------------------- Total revenues .................................. 1,131 255 1,125 219 2,730 Production costs .............................................. 193 93 130 74 490 Exploration expenses .......................................... 59 1 73 51 184 Dry hole costs ................................................ 29 -- 69 1 99 Depreciation, depletion & amortization (b) .................... 468 53 303 69 893 Other operating expenses ...................................... 77 12 47 57 193 -------------------------------------------------------------- Results of operations before income tax ............... $ 305 $ 96 $ 503 $ (33) $ 871 (a) Includes the gain on the sale of the company's Oklahoma and Canadian properties. (b) Includes asset write-downs.
Table 4
UNOCAL CORPORATION OPERATING HIGHLIGHTS (UNAUDITED) For the Three Months For the Twelve Months Ended December 31 Ended December 31 ---------------------------------------------------- 1998 1997 1998 1997 - ------------------------------------------------------------------------------------------------------------------------------------ Net daily production Crude oil and condensate (thousand barrels daily): United States Spirit Energy 76 ........................................ 42 43 44 45 Alaska .................................................. 29 34 29 31 ---------------------------------------------------- Total United States ............................... 71 77 73 76 International Far East (a) ........................................... 72 96 80 95 Other ................................................... 27 25 30 26 ---------------------------------------------------- Total International ............................... 99 121 110 121 - ------------------------------------------------------------------------------------------------------------------------------------ Total Worldwide ................................... 170 198 183 197 Natural gas (million cubic feet daily): United States Spirit Energy 76 ........................................ 798 813 795 860 Alaska .................................................. 147 138 132 133 ---------------------------------------------------- Total United States ............................... 945 951 927 993 International Far East (a) ........................................... 857 809 853 795 Other ................................................... 26 57 45 60 ---------------------------------------------------- Total International ............................... 883 866 898 855 - ------------------------------------------------------------------------------------------------------------------------------------ Total Worldwide ................................... 1,828 1,817 1,825 1,848 Natural gas liquids (thousand barrels daily) ........................... 19 17 19 18 Geothermal (million kilowatt-hours daily) .............................. 23 20 21 18 Average sales prices (b) Crude oil and condensate (per barrel): United States Spirit Energy 76 .............................................. $ 11.00 $ 18.08 $ 12.41 $ 18.47 Alaska ........................................................ 8.78 14.83 9.35 15.25 Total United States ..................................... $ 10.07 $ 16.70 $ 11.17 $ 17.13 International Far East ...................................................... $ 11.00 $ 17.95 $ 12.55 $ 18.52 Other ......................................................... 9.66 16.90 10.73 17.39 Total International ..................................... $ 10.61 $ 17.65 $ 12.04 $ 18.21 Total Worldwide ......................................... $ 10.37 $ 17.23 $ 11.67 $ 17.71 Natural gas (per mcf): United States Spirit Energy 76 .............................................. $ 2.05 $ 2.92 $ 2.07 $ 2.51 Alaska ........................................................ 1.20 1.47 1.33 1.41 Total United States ..................................... $ 1.91 $ 2.70 $ 1.97 $ 2.36 International Far East ...................................................... $ 1.95 $ 2.16 $ 2.06 $ 2.30 Other ......................................................... 2.40 2.34 2.36 2.25 Total International ..................................... $ 1.98 $ 2.17 $ 2.07 $ 2.30 Total Worldwide ......................................... $ 1.96 $ 2.44 $ 2.02 $ 2.33 - ------------------------------------------------------------------------------------------------------------------------------------ (a) Includes host country share of: Crude oil and condensate .................................................... 9 26 10 28 Natural gas ................................................................. 67 34 49 28 (b) Excludes Global Trade margins and Canada equity affiliate sales
Table 5
UNOCAL CORPORATION OPERATING HIGHLIGHTS (continued) (UNAUDITED) For the Three Months For the Twelve Months Ended December 31 Ended December 31 ---------------------------------------------------- 1998 1997 1998 1997 - ------------------------------------------------------------------------------------------------------------------------------------ Agricultural products production volumes (thousand tons) Ammonia ............................................................... 395 383 1,524 1,455 Urea .................................................................. 235 223 974 919 Agricultural products sales volumes (thousand tons) Ammonia ............................................................... 240 179 889 769 Urea .................................................................. 242 285 1,096 975
Table 6
UNOCAL CORPORATION EARNINGS BY BUSINESS SEGMENT (UNAUDITED) 4th Quarter of 1998 4th Quarter of 1997 ---------------------------------------------------- Millions of dollars Before-tax After-tax Before-tax After-tax - ------------------------------------------------------------------------------------------------------------------------------------ Exploration and Production United States Spirit Energy 76 ...................................................... $ (26) $ (17) $ 95 $ 59 Alaska ................................................................ (15) (9) 29 18 International Far East .............................................................. 123 69 99 102 Other ................................................................. (31) (16) (7) (13) Global Trade ................................................................. 12 8 5 3 Geothermal and Power Operations .............................................. 11 8 3 1 Diversified Business Group Agricultural Products .................................................. 4 4 8 4 Carbon and Minerals .................................................... (54) (33) (1) -- Pipelines .............................................................. 28 23 16 13 Other .................................................................. -- -- 2 1 Corporate and Unallocated Administrative and general expense ..................................... (22) (17) (20) (16) Net interest expense ................................................... (38) (30) (24) (22) Environmental and litigation expense ................................... (42) (27) (8) (5) New Ventures (non E&P) ................................................. (7) (6) (15) (10) Other .................................................................. 26 14 -- 13 - ------------------------------------------------------------------------------------------------------------------------------------ Earnings / (Loss) from continuing operations before discontinued operations ............................................ (31) (29) 182 148 Loss from discontinued operations ............................................ -- -- (10) (6) - ------------------------------------------------------------------------------------------------------------------------------------ Total ............................................................ $ (31) $ (29) $ 172 $ 142 ==================================================================================================================================== Exploration and Production - involves the exploration for, and the production of crude oil and natural gas. Global Trade - handles the company's worldwide crude oil, condensate and natural gas trading and marketing activities. Global Trade also purchases crude oil, condensate and natural gas from the company's joint venture partners, royalty owners and other unaffiliated oil and gas producers for resale. Geothermal and Power Operations - involves the exploration for, and the production and sale of geothermal resources, and the construction and operation of electrical power plants. Diversified Business Group: Agricultural Products - involves the manufacture, transportation and marketing of nitrogen-based products for agricultural and industrial use. Carbon and Minerals - involves the production and marketing of petroleum coke, graphites and specialty minerals. Pipelines -principally includes the company's equity interests in affiliated pipeline companies. Other - principally included the company's equity interest in The UNO-VEN Company, prior to its restructuring in May 1997.
Table 7
UNOCAL CORPORATION SPECIAL ADJUSTMENTS (UNAUDITED) 4th Quarter of 1998 4th Quarter of 1997 ---------------------------------------------------- Millions of dollars Before-tax After-tax Before-tax After-tax - ------------------------------------------------------------------------------------------------------------------------------------ Reported earnings / (loss) ................................................... $ (31) $ (29) $ 172 $ 142 Less: Special items Exploration and Production United States Spirit Energy Asset sales .................................................... 22 14 9 5 Asset write-downs .............................................. (43) (27) (4) (2) Litigation ..................................................... 11 7 -- -- Alaska Asset write-downs .............................................. (19) (12) -- -- International Asset sales - Other ............................................ (3) (1) 2 1 Asset write-downs - Other ...................................... (6) (4) (3) (2) Bangladesh well blowout - Other ................................ -- -- (2) (1) Deferred tax adjustments ....................................... -- (8) -- 26 Diversified Business Group Carbon and Minerals Asset write-downs .............................................. (34) (22) -- -- Environmental and litigation ................................... (21) (13) (10) (6) Restructuring costs ............................................ -- -- (2) (1) Pipelines Asset sales .................................................... 8 5 -- -- Other UNO-VEN restructuring .......................................... -- -- 2 1 Corporate and Unallocated Asset sales - Other ............................................ -- -- 11 7 Environmental and litigation ................................... (37) (24) (5) (3) Deferred tax adjustment - Other ................................ -- -- -- (11) Insurance benefit - Other ...................................... 70 45 -- -- Restructuring costs - Other .................................... (27) (17) -- -- Discontinued Operations Net loss on disposal ........................................... -- -- (10) (6) - ------------------------------------------------------------------------------------------------------------------------------------ Total special items ..................................................... (79) (57) (12) 8 - ------------------------------------------------------------------------------------------------------------------------------------ Adjusted earnings ................................................... $ 48 $ 28 $ 184 $ 134 ====================================================================================================================================
Table 8
UNOCAL CORPORATION EARNINGS BY BUSINESS SEGMENT EXCLUDING SPECIAL ADJUSTMENTS (UNAUDITED) 4th Quarter of 1998 4th Quarter of 1997 ---------------------------------------------------- Millions of dollars except share amounts Before-tax After-tax Before-tax After-tax - ------------------------------------------------------------------------------------------------------------------------------------ Exploration and Production United States Spirit Energy 76 ...................................................... $ (16) $ (11) $ 90 $ 56 Alaska ................................................................ 4 3 29 18 International Far East .............................................................. 123 68 99 76 Other ................................................................. (22) (2) (4) (11) Global Trade ................................................................. 12 8 5 3 Geothermal and Power Operations .............................................. 11 8 3 1 Diversified Business Group Agricultural Products .................................................. 4 4 8 4 Carbon and Minerals .................................................... 1 2 11 7 Pipelines .............................................................. 20 18 16 13 Corporate and Unallocated Administrative and general expense ..................................... (22) (17) (20) (16) Net interest expense ................................................... (38) (30) (24) (22) Environmental and litigation expense ................................... (5) (3) (3) (2) New Ventures (non E&P) ................................................. (7) (6) (15) (10) Other .................................................................. (17) (14) (11) 17 - ------------------------------------------------------------------------------------------------------------------------------------ Earnings from continuing operations .......................................... $ 48 $ 28 $ 184 $ 134 ==================================================================================================================================== Basic earnings from continuing operations per share of common stock ................................................. $ 0.11 $ 0.55 Diluted earnings from continuing operations per share of common stock (a) ............................................. $ 0.11 $ 0.54 Distributions on preferred securities (net of tax) excluded in numerator for diluted earnings per share (a) ........................... $ -- $ 6 Basic weighted average shares ................................................ 241 245 Diluted weighted average shares .............................................. 242 259 (a) In 1998, the effect of assumed conversion of preferred securities on earnings per share is antidilutive.
Table 9
UNOCAL CORPORATION EARNINGS BY BUSINESS SEGMENT (UNAUDITED) Twelve Months Ended Twelve Months Ended December 31, 1998 December 31, 1997 ---------------------------------------------------- Millions of dollars Before-tax After-tax Before-tax After-tax - ------------------------------------------------------------------------------------------------------------------------------------ Exploration and Production United States Spirit Energy 76 ..................................................... $ -- $ -- $ 305 $ 191 Alaska ............................................................... 9 6 96 60 International Far East ............................................................. 443 195 503 392 Other ................................................................ 53 41 (33) (45) Global Trade ................................................................ 33 21 27 16 Geothermal and Power Operations ............................................. 77 52 31 26 Diversified Business Group Agricultural Products ................................................. 44 37 83 54 Carbon and Minerals ................................................... (28) (9) 109 76 Pipelines ............................................................. 81 67 70 59 Other ................................................................. -- -- 45 38 Corporate and Unallocated Administrative and general expense .................................... (84) (60) (82) (56) Net interest expense .................................................. (144) (113) (133) (106) Environmental and litigation expense .................................. (161) (102) (146) (91) New Ventures (non E&P) ................................................ (33) (22) (49) (33) Other ................................................................. 15 17 (55) 88 - ------------------------------------------------------------------------------------------------------------------------------------ Earnings from continuing operations before discontinued operations and extraordinary item ................................................... 305 130 771 669 Loss from discontinued operations ........................................... -- -- (81) (50) Extraordinary item .......................................................... -- -- (52) (38) - ------------------------------------------------------------------------------------------------------------------------------------ Total ........................................................... $ 305 $ 130 $ 638 $ 581 ====================================================================================================================================
Table 10
UNOCAL CORPORATION SPECIAL ADJUSTMENTS (UNAUDITED) Twelve Months Ended Twelve Months Ended December 31, 1998 December 31, 1997 ---------------------------------------------------- Millions of dollars Before-tax After-tax Before-tax After-tax - ------------------------------------------------------------------------------------------------------------------------------------ Reported earnings ........................................................... $ 305 $ 130 $ 638 $ 581 Less: Special items Exploration and Production United States Spirit Energy Asset sales ................................................... 22 14 11 7 Asset write-downs ............................................. (43) (27) (66) (41) Litigation .................................................... 11 7 -- -- Alaska Asset write-downs ............................................. (19) (12) -- -- International Asset sales - Other ........................................... 155 101 (15) (16) Asset write-downs - Other ..................................... (6) (4) (3) (2) Bangladesh well blowout - Other ............................... -- -- (12) (8) Deferred tax adjustments ...................................... -- (29) -- 94 Geothermal and Power Operations Deferred tax adjustment ....................................... -- -- -- 10 Diversified Business Group Carbon and Minerals Asset sales ................................................... -- -- 67 41 Asset write-downs ............................................. (34) (22) -- -- Environmental and litigation .................................. (27) (17) (10) (6) Restructuring costs ........................................... -- -- (2) (1) Pipelines Asset sales ................................................... 8 5 -- -- Other UNO-VEN restructuring ......................................... -- -- 48 40 Corporate and Unallocated Asset sales - Other ........................................... -- -- 18 11 Deferred tax adjustment - Other ............................... -- -- -- 103 Environmental and litigation .................................. (143) (91) (125) (78) Insurance benefit - Other ..................................... 70 45 -- -- Insurance settlement - Other ................................. 17 11 -- -- Restructuring costs - Other ................................... (27) (17) -- -- Discontinued Operations Net loss on disposal .......................................... -- -- (81) (50) Extraordinary Item Extinguishment of debt ........................................ -- -- (52) (38) - ------------------------------------------------------------------------------------------------------------------------------------ Total special items .................................................... (16) (36) (222) 66 - ------------------------------------------------------------------------------------------------------------------------------------ Adjusted earnings .................................................. $ 321 $ 166 $ 860 $ 515 ====================================================================================================================================
Table 11
UNOCAL CORPORATION EARNINGS BY BUSINESS SEGMENT EXCLUDING SPECIAL ADJUSTMENTS (UNAUDITED) Twelve Months Ended Twelve Months Ended December 31, 1998 December 31, 1997 ---------------------------------------------------- Millions of dollars except share amounts Before-tax After-tax Before-tax After-tax - ------------------------------------------------------------------------------------------------------------------------------------ Exploration and Production United States Spirit Energy 76 ..................................................... $ 10 $ 6 $ 360 $ 225 Alaska ............................................................... 28 18 96 60 International Far East ............................................................. 443 215 503 298 Other ................................................................ (96) (47) (3) (19) Global Trade ................................................................ 33 21 27 16 Geothermal and Power Operations ............................................. 77 52 31 16 Diversified Business Group Agricultural Products ................................................. 44 37 83 54 Carbon and Minerals ................................................... 33 30 54 42 Pipelines ............................................................. 73 62 70 59 Other ................................................................. -- -- (3) (2) Corporate and Unallocated Administrative and general expense .................................... (84) (60) (82) (56) Net interest expense .................................................. (144) (113) (133) (106) Environmental and litigation expense .................................. (18) (11) (21) (13) New Ventures (non E&P) ................................................ (33) (22) (49) (33) Other ................................................................. (45) (22) (73) (26) - ------------------------------------------------------------------------------------------------------------------------------------ Earnings from continuing operations ......................................... $ 321 $ 166 $ 860 $ 515 ==================================================================================================================================== Basic earnings from continuing operations per share of common stock ................................................ $ 0.69 $ 2.08 Diluted earnings from continuing operations per share of common stock (a) ............................................ $ 0.68 $ 2.06 Distributions on preferred securities (net of tax) excluded in numerator for diluted earnings per share (a) .......................... $ -- $ 24 Basic weighted average shares ............................................... 241 248 Diluted weighted average shares ............................................. 242 262 (a) In 1998, the effect of assumed conversion of preferred securities on earnings per share is antidilutive
Table 12 Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. UNOCAL CORPORATION (Registrant) Date: January 28, 1999 By: /s/ JOE D. CECIL - ----------------------- ------------------------------------ Joe D. Cecil Vice President and Comptroller -----END PRIVACY-ENHANCED MESSAGE-----