-----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, RpCo98QnpqHPFXTg1YAEMad8iJNio6OtYB+20DOnVkpRB4FX167WNp1LGijjHAyY TsbBDEzeOUl51yKW3UAOag== 0000716039-98-000032.txt : 19980803 0000716039-98-000032.hdr.sgml : 19980803 ACCESSION NUMBER: 0000716039-98-000032 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19980728 ITEM INFORMATION: FILED AS OF DATE: 19980728 SROS: CSX SROS: NYSE SROS: PCX 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: 98672694 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 2ND QUARTER 1998 EARNINGS RELEASE 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) July 28, 1998 ------------- 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. Unocal Corporation today said that lower crude oil prices led to lower second quarter 1998 net earnings of $105 million, or 43 cents per share (diluted). In the second quarter 1997, Unocal had net earnings of $118 million, or 47 cents per share (diluted). Earnings from continuing operations, excluding special items (detailed in the attached tables), were $62 million, or 26 cents per common share (diluted). This compares with $97 million, or 39 cents per common share (diluted), in the second quarter last year. Net earnings for the first six months of 1998 were $123 million, or 50 cents per share (diluted). This compares with $262 million, or $1.04 per share (diluted) in the same period of 1997. Year-to-date earnings from continuing operations, excluding special items (detailed in the attached tables) were $134 million (55 cents per share diluted), down from $287 million ($1.13 per share diluted) last year. COMMODITY PRICE IMPACTS "This year has been particularly challenging as lower worldwide commodity prices continue to impact earnings," said Roger C. Beach, Unocal chairman and chief executive officer. "If you compare our results with 1997, lower oil prices reduced earnings by nearly 20 cents per share in the second quarter, while lower oil and natural gas prices reduced earnings by about 65 cents per share for first six months of the year." Beach also noted that lower prices for agricultural products reduced earnings by more than 5 cents per share in the second quarter and about 15 cents per share in the year-to-date results, when compared with the comparable periods a year ago. "Our balance sheet remains strong, however," Beach said, "giving us the strength to weather this period of lower prices and the flexibility to take advantage of new opportunities if they present themselves." COST CONTROLS Beach said the company continues to focus on reducing costs to help offset the impact of lower prices. "We have cut production costs for Spirit Energy 76, our domestic E&P unit," Beach said. "Spirit Energy aims to reduce production costs for the full year 1998 by 10 to 15 cents per BOE, compared with last year." OIL AND GAS EXPLORATION AND PRODUCTION "We are particularly encouraged by our operations in Thailand where we recorded our best quarter ever for natural gas production," Beach said. "Gross natural gas production averaged 1.02 billion cubic feet (bcf) per day (Unocal, 65% working interest) as Thailand has increased use of indigenous gas supplies for power generation. For the full-year 1998, we expect that gross natural gas production from Thailand will average above 1 bcf per day." The company is continuing its aggressive worldwide exploration program. Unocal's Spirit Energy 76 unit participated in a natural gas discovery on the Cotton Valley Reef trend in East Texas. The well was placed on production within 30 days of the discovery. Since stepping up its exploration program in October 1997, Spirit Energy 76 has recorded 28 oil and gas discoveries (success rate of more than 50%) both onshore and in the continental shelf area of the Gulf of Mexico. Spirit Energy's net production increased in the second quarter, compared with the first three months of the year, reversing declines recorded during 1997. The company expects Spirit Energy's full-year 1998 production to average about 178,000 BOE per day. By the end of this week, Unocal expects to have three new deepwater exploration wells under way. In the Gulf of Mexico, we expect to spud a well on the Mirage prospect (Unocal, 25% working interest) and the Calypso prospect (Unocal, 50% working interest). The Calypso well is an offset to a successful exploration well on the adjacent Leo prospect. In the Makassar Strait production sharing contract area offshore East Kalimantan in Indonesia, Unocal last week spudded an exploration well on the deepwater Seno prospect (Unocal, 50% working interest). OTHER FINANCIAL RESULTS Total revenues for the second quarter were $1.4 billion, down from $1.65 billion a year ago. Total revenues for the six months were $2.6 billion, compared with $3.11 billion for the first half of 1997. Unocal is a leading global oil and gas exploration and production company with significant pipeline and power plant project developments worldwide. Forward-looking statements and estimates regarding drilling activity, production and business results set forth above are based on assumptions concerning market, competitive, regulatory, environmental, operational and other considerations. Actual results could differ materially.
UNOCAL CORPORATION CONDENSED CONSOLIDATED EARNINGS STATEMENT (UNAUDITED) For the Three Months For the Six Months Ended June 30 Ended June 30 ----------------------------------------- Millions of dollars except per share amounts 1998 1997 1998 1997 - ------------------------------------------------------------------------------------------------------------------------------- Total revenues ...................................................................... $ 1,397 $ 1,654 $ 2,604 $ 3,110 Costs and other deductions .......................................................... 1,233 1,405 2,343 2,524 --------------------------------------- Earnings from continuing operations before income taxes ............................. 164 249 261 586 Income taxes ........................................................................ 59 93 138 242 --------------------------------------- Earnings from continuing operations ................................................. 105 156 123 344 Loss from discontinued operations (net of tax) ..................................... -- -- -- (44) Extraordinary charge - extinguishment of debt (net of tax) .......................... -- (38) -- (38) --------------------------------------- Net earnings ........................................................................ $ 105 $ 118 $ 123 $ 262 Basic earnings/(loss) per common share (a) Continuing operations ......................................................... $ 0.43 $ 0.62 $ 0.51 $ 1.38 Discontinued operations ....................................................... -- -- -- (0.18) Extraordinary item - extinguishment of debt (net of tax) ...................... -- (0.15) -- (0.15) --------------------------------------- Basic net earnings per share ........................................................ $ 0.43 $ 0.47 $ 0.51 $ 1.05 Diluted earnings/(loss) per common share (b) (c) Continuing operations ......................................................... $ 0.43 $ 0.61 $ 0.50 $ 1.35 Discontinued operations ....................................................... -- -- -- (0.17) Extraordinary item - extinguishment of debt (net of tax) ...................... -- (0.14) -- (0.14) --------------------------------------- Diluted net earnings per share ...................................................... $ 0.43 $ 0.47 $ 0.50 $ 1.04 (a) Weighted average shares - basic (millions) ...................................... 241 250 241 250 (b) Weighted average shares - diluted (millions) .................................... 243 264 243 264 (c) Distribution on preferred securities (net of taxes) excluded in numerator ....... $ -- $ 6 $ -- $ 12 In 1998, the effect of assumed conversion of preferred securities on earnings per share is antidilutive - ---------------------------------------------------------------------------------------------------------- CONDENSED CONSOLIDATED BALANCE SHEET (UNAUDITED) Jun. 30 Dec. 31 Millions of dollars 1998 1997 - ---------------------------------------------------------------------------------------------------------- Assets Cash and cash equivalents ........................................................... $ 193 $ 338 Other current assets ................................................................ 1,067 1,163 Investments and long-term receivables ............................................... 1,340 1,113 Properties - net .................................................................... 4,952 4,816 Other assets ........................................................................ 198 100 ------------------ Total assets ................................................................ $ 7,750 $ 7,530 Liabilities and Equity Current liabilities ................................................................. $ 974 $ 1,160 Long-term debt ...................................................................... 2,480 2,169 Deferred income taxes ............................................................... 172 137 Other deferred credits and liabilities .............................................. 1,302 1,228 Convertible preferred securities .................................................... 522 522 Stockholders' equity ................................................................ 2,300 2,314 ------------------ Total liabilities and equity ................................................ $ 7,750 $ 7,530
Table 1
UNOCAL CORPORATION CONDENSED CONSOLIDATED CASH FLOWS (UNAUDITED) For the Three Months For the Six Months Ended June 30 Ended June 30 (a) ----------------------------------------- Millions of dollars 1998 1997(a) 1998 1997 - ----------------------------------------------------------------------------------------------------------------------- Cash flows from operating activities Net earnings ............................................... $ 105 $ 118 $ 123 $ 262 Adjustments to reconcile net earnings to net cash provided by operating activities Loss on disposal of discontinued operations (before-tax) -- -- -- 71 Depreciation, depletion and amortization ............. 199 244 380 455 Dry hole costs ....................................... 42 27 92 43 Deferred income taxes ................................ 17 19 30 29 Gain on sales of assets (before-tax) ................. (92) (51) (92) (61) Other ................................................ 7 (131) 27 (158) Working capital and other changes related to operations .... 25 (123) (163) (204) ----------------------------------------- Net cash provided by operating activities ............ 303 103 397 437 Cash flows from investing activities Capital expenditures (includes dry hole costs) ............ (440) (359) (766) (645) Proceeds from sale of discontinued operations .............. -- 396 -- 1,786 Proceeds from asset sales .................................. 30 32 34 48 ----------------------------------------- Net cash (used in)/provided by investing activities .. (410) 69 (732) 1,189 Cash flows from financing activities Net increase/(decrease) in long-term debt .................. 79 (893) 341 (718) Dividends paid ............................................. (49) (50) (97) (100) Repurchase of common stock ................................. -- (46) (48) (92) Other ...................................................... (5) (48) (6) (49) ----------------------------------------- Net cash provided by/(used in) financing activities .. 25 (1,037) 190 (959) Increase/(decrease) in cash and cash equivalents .......................... (82) (865) (145) 667 Cash and cash equivalents at beginning of period .......................... 275 1,749 338 217 ----------------------------------------- Cash and cash equivalents at end of period ................................ $ 193 $ 884 $ 193 $ 884 (a) Cash flows related to discontinued operations have not been segregated - ----------------------------------------------------------------------------------------------------------------------- CONDENSED CAPITAL EXPENDITURES (UNAUDITED) Millions of dollars - ----------------------------------------------------------------------------------------------------------------------- United States Exploration & Production .................................... $ 216 $ 79 $ 352 $ 112 International Exploration & Production .................................... 196 240 364 403 Geothermal and Power Operations ........................................... 4 27 10 47 Diversified Business Group ................................................ 18 13 28 22 New Ventures (Non-E & P) ................................................. 1 (2) 1 3 Corporate & Unallocated ................................................... 5 2 11 9 Discontinued Operations ................................................... -- -- -- 49 ----------------------------------------- Total (b) .................................................. $ 440 $ 359 $ 766 $ 645 (b) Includes capitalized interest of: .................................... $ 8 $ 11 $ 16 $ 16
Table 2
UNOCAL CORPORATION RESULTS OF OPERATIONS FOR EXPLORATION AND PRODUCTION ACTIVITIES (UNAUDITED) For the Three Months Ended June 30, 1998 -------------------------------------------------- Spirit Other Millions of dollars Energy 76 Alaska Far East International Total - ----------------------------------------------------------------------------------------------------------------- Sales (includes intercompany sales) Crude oil and condensate ........................... $ 51 $ 24 $ 83 $ 23 $ 181 Natural gas ........................................ 148 16 149 7 320 Natural gas liquids ................................ 14 -- 3 -- 17 Other .............................................. 1 -- -- -- 1 -------------------------------------------------- Total ........................................ 214 40 235 30 519 Other revenue/(loss) ....................................... 1 2 (4) 3 2 Gain on asset sales ........................................ -- -- 3 87 90 -------------------------------------------------- Total revenues ............................... 215 42 234 120 611 Production costs ........................................... 39 23 30 15 107 Exploration expenses ....................................... 12 1 19 4 36 Dry hole costs ............................................. 27 -- 12 3 42 Depreciation, depletion & amortization ..................... 92 13 59 17 181 Other operating expenses ................................... 21 3 15 16 55 -------------------------------------------------- Results of operations before income tax ............ $ 24 $ 2 $ 99 $ 65 $ 190 - ----------------------------------------------------------------------------------------------------------------- For the Three Months Ended June 30, 1997 - ----------------------------------------------------------------------------------------------------------------- Spirit Other Energy 76 Alaska Far East International Total -------------------------------------------------- Sales (includes intercompany sales) Crude oil and condensate ........................... $ 75 $ 40 $ 113 $ 40 $ 268 Natural gas ........................................ 146 14 152 10 322 Natural gas liquids ................................ 13 2 5 1 21 Other .............................................. 1 -- -- -- 1 -------------------------------------------------- Total ........................................ 235 56 270 51 612 Other revenue .............................................. 3 1 3 3 10 Gain/(loss) on asset sales ................................. 1 -- -- (17) (16) -------------------------------------------------- Total revenues ............................... 239 57 273 37 606 Production costs ........................................... 50 22 33 17 122 Exploration expenses ....................................... 14 -- 10 9 33 Dry hole costs ............................................. 1 -- 26 -- 27 Depreciation, depletion & amortization ..................... 103 14 93 19 229 Other operating expenses ................................... 19 4 11 16 50 -------------------------------------------------- Results of operations before income tax ............ $ 52 $ 17 $ 100 $ (24) $ 145
Table 3
UNOCAL CORPORATION RESULTS OF OPERATIONS FOR EXPLORATION AND PRODUCTION ACTIVITIES (UNAUDITED) For the Six Months Ended June 30, 1998 ----------------------------------------------------------- Spirit Other Millions of dollars Energy 76 Alaska Far East International Total - --------------------------------------------------------------------------------------------------------------------------- Sales (includes intercompany sales) Crude oil and condensate ........................... $ 106 $ 52 $ 176 $ 53 $ 387 Natural gas ........................................ 291 34 290 16 631 Natural gas liquids ................................ 25 1 6 1 33 Other .............................................. 2 -- -- -- 2 ------------------------------------------------------------ Total ........................................ 424 87 472 70 1,053 Other revenue/(loss) ....................................... 4 4 (12) 8 4 Gain on asset sales ........................................ -- -- 3 87 90 ------------------------------------------------------------ Total revenues ............................... 428 91 463 165 1,147 Production costs ........................................... 83 42 56 36 217 Exploration expenses ....................................... 26 1 39 15 81 Dry hole costs ............................................. 66 -- 15 8 89 Depreciation, depletion & amortization ..................... 176 21 113 35 345 Other operating expenses ................................... 37 6 28 25 96 ------------------------------------------------------------ Results of operations before income tax ............ $ 40 $ 21 $ 212 $ 46 $ 319 - --------------------------------------------------------------------------------------------------------------------------- For the Six Months Ended June 30, 1997 ------------------------------------------------------------ Spirit Other Energy 76 Alaska Far East International Total ------------------------------------------------------------ Sales (includes intercompany sales) Crude oil and condensate ........................... $ 166 $ 96 $ 230 $ 85 $ 577 Natural gas ........................................ 370 32 317 24 743 Natural gas liquids ................................ 29 3 14 2 48 Other .............................................. 1 -- -- -- 1 ------------------------------------------------------------ Total ........................................ 566 131 561 111 1,369 Other revenue .............................................. 6 1 4 13 24 Gain/(loss) on asset sales ................................. 4 -- -- (16) (12) ------------------------------------------------------------ Total revenues ............................... 576 132 565 108 1,381 Production costs ........................................... 98 46 63 36 243 Exploration expenses ....................................... 24 -- 18 18 60 Dry hole costs ............................................. 7 -- 35 1 43 Depreciation, depletion & amortization ..................... 205 29 154 36 424 Other operating expenses ................................... 38 6 22 24 90 ------------------------------------------------------------ Results of operations before income tax ............ $ 204 $ 51 $ 273 $ (7) $ 521
Table 4
UNOCAL CORPORATION OPERATING HIGHLIGHTS (UNAUDITED) For the Three Months For the Six Months Ended June 30 Ended June 30 ---------------------------------------------- 1998 1997 1998 1997 - ------------------------------------------------------------------------------------------------------------- Net daily production Crude oil and condensate (thousand barrels daily): United States Spirit Energy 76 ...................... 44 46 44 47 Alaska ................................ 29 31 30 32 ---------------------------------------------- Total United States ............. 73 77 74 79 International Far East (a) ......................... 80 95 84 94 Other ................................. 32 27 32 27 ---------------------------------------------- Total International ............. 112 122 116 121 - ------------------------------------------------------------------------------------------------------------- Total Worldwide ................. 185 199 190 200 Natural gas (million cubic feet daily): United States Spirit Energy 76 ...................... 795 874 784 892 Alaska ................................ 121 127 130 141 ---------------------------------------------- Total United States ............. 916 1,001 914 1,033 International Far East (a) ......................... 830 774 828 789 Other ................................. 67 63 60 66 ---------------------------------------------- Total International ............. 897 837 888 855 - ------------------------------------------------------------------------------------------------------------- Total Worldwide ................. 1,813 1,838 1,802 1,888 Natural gas liquids (thousand barrels daily) ......... 20 19 19 19 Geothermal (million kilowatt-hours daily) ............ 18 17 20 17 Average sales prices (b) Crude oil and condensate (per barrel): United States Spirit Energy 76 ...................... $ 13.04 $ 17.77 $ 13.50 $ 19.30 Alaska ................................ 8.83 14.23 9.84 16.45 Total United States ............. $ 11.35 $ 16.36 $ 12.01 $ 18.15 International Far East .............................. $ 12.85 $ 17.97 $ 13.42 $ 19.41 Other ................................. 10.31 16.11 11.34 18.01 Total International ............. $ 12.14 $ 17.44 $ 12.84 $ 19.01 Total Worldwide ................. $ 11.80 $ 16.96 $ 12.49 $ 18.61 Natural gas (per mcf): United States Spirit Energy 76 ...................... $ 2.15 $ 1.98 $ 2.15 $ 2.39 Alaska ................................ 1.48 1.35 1.47 1.35 Total United States ............. $ 2.06 $ 1.89 $ 2.05 $ 2.25 International Far East .............................. $ 2.04 $ 2.25 $ 2.03 $ 2.33 Other ................................. 2.46 2.08 2.24 2.16 Total International ............. $ 2.05 $ 2.24 $ 2.04 $ 2.31 Total Worldwide ................. $ 2.05 $ 2.05 $ 2.05 $ 2.28 - ------------------------------------------------------------------------------------------------------------- (a) Includes host country share of: Crude oil and condensate ........................... 8 30 13 30 Natural gas ........................................ 22 25 27 29 (b) Excludes Global Trade margins and Canada equity affiliate sales
Table 5
UNOCAL CORPORATION OPERATING HIGHLIGHTS (continued) (UNAUDITED) For the Three Months For the Six Months Ended June 30 Ended June 30 ---------------------------------------- 1998 1997 1998 1997 - ----------------------------------------------------------------------------------------------------- Agricultural products production volumes (thousand tons) Ammonia ............................................. 390 367 764 758 Urea ................................................ 245 233 505 508 Agricultural products sales volumes (thousand tons) Ammonia ............................................. 243 247 463 403 Urea ................................................ 270 289 595 499
Table 6
UNOCAL CORPORATION EARNINGS BY BUSINESS SEGMENT (Unaudited) 2nd Quarter of 1998 2nd Quarter of 1997 --------------------------------------------- Millions of dollars Before-tax After-tax Before-tax After-tax - ------------------------------------------------------------------------------------------------------ Exploration and Production United States Spirit Energy 76 ............................... $ 24 $ 15 $ 52 $ 33 Alaska ......................................... 2 1 17 11 International ..................................... 164 103 76 28 Global Trade .......................................... 7 4 8 5 Geothermal and Power Operations ....................... 22 14 11 13 Diversified Business Group Agricultural Products ........................... 18 12 40 26 Carbon and Minerals ............................. 9 9 85 56 Pipelines ....................................... 19 15 18 16 Other ........................................... -- -- 42 36 Corporate and Unallocated Administrative and general expense .............. (16) (12) (22) (14) Net interest expense ............................ (33) (24) (29) (23) Environmental and litigation expense ............ (48) (30) (16) (10) New Ventures (non-E&P)........................... (8) (5) (20) (15) Other ........................................... 4 3 (13) (6) - ------------------------------------------------------------------------------------------------------- Earnings from continuing operations before discontinued operations and extraordinary item ............................. 164 105 249 156 Extraordinary item .................................... -- -- (52) (38) - ------------------------------------------------------------------------------------------------------- Total ..................................... $ 164 $ 105 $ 197 $ 118 =======================================================================================================
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) 2nd Quarter of 1998 2nd Quarter of 1997 -------------------------------------------- Millions of dollars Before-tax After-tax Before-tax After-tax - ------------------------------------------------------------------------------------------------------- Reported earnings ..................................... $ 164 $ 105 $ 197 $ 118 Less: Special items Exploration and Production International Asset sales ............................. 85 53 (17) (17) Bangladesh well blowout ................. -- -- (10) (7) Deferred tax adjustment ................. -- 7 -- -- Geothermal and Power Operations Deferred tax adjustment - Sarulla ....... -- -- -- 7 Diversified Business Group Carbon and Minerals Asset sales ............................. -- -- 67 41 Environmental and litigation ............ (3) (1) -- -- Other UNO-VEN restructuring ................... -- -- 46 39 Corporate and Unallocated Asset sales ............................. -- -- 1 1 Environmental and litigation ............ (43) (27) (9) (5) Insurance settlement .................... 17 11 -- -- Extraordinary item Extinguishment of debt .................. -- -- (52) (38) - ------------------------------------------------------------------------------------------------------- Total special items .............................. 56 43 26 21 - ------------------------------------------------------------------------------------------------------- Adjusted earnings ............................ $ 108 $ 62 $ 171 $ 97 =======================================================================================================
Table 8
UNOCAL CORPORATION EARNINGS BY BUSINESS SEGMENT EXCLUDING SPECIAL ADJUSTMENTS (Unaudited) 2nd Quarter of 1998 2nd 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 ............................... $ 24 $ 15 $ 52 $ 33 Alaska ......................................... 2 1 17 11 International ..................................... 79 43 103 52 Global Trade .......................................... 7 4 8 5 Geothermal and Power Operations ....................... 22 14 11 6 Diversified Business Group Agricultural Products ........................... 18 12 40 26 Carbon and Minerals ............................. 12 10 18 15 Pipelines ....................................... 19 15 18 16 Other ........................................... -- -- (4) (3) Corporate and Unallocated Administrative and general expense .............. (16) (12) (22) (14) Net interest expense ............................ (33) (24) (29) (23) Environmental and litigation expense ............ (5) (3) (7) (5) New Ventures (non-E&P)........................... (8) (5) (20) (15) Other ........................................... (13) (8) (14) (7) - ------------------------------------------------------------------------------------------------------- Earnings from continuing operations ................... $ 108 $ 62 $ 171 $ 97 ======================================================================================================= Basic earnings from continuing operations per share of common stock .......................... $ 0.26 $ 0.39 Diluted earnings from continuing operations per share of common stock (a) ...................... $ 0.26 $ 0.39 Distributions on preferred securities (net of tax) excluded in numerator for diluted earnings per share (a) .... $ -- $ 6 Basic weighted average shares ......................... 241 250 Diluted weighted average shares ....................... 243 264 (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) Six Months Ended Six Months Ended June 30, 1998 June 30, 1997 --------------------------------------------- Millions of dollars Before-tax After-tax Before-tax After-tax - -------------------------------------------------------------------------------------------------- Exploration and Production United States Spirit Energy 76 .......................... $ 40 $ 25 $ 204 $ 128 Alaska .................................... 21 13 51 32 International ................................ 258 116 266 130 Global Trade ..................................... 16 10 19 11 Geothermal and Power Operations .................. 44 28 21 19 Diversified Business Group Agricultural Products ...................... 31 21 70 46 Carbon and Minerals ........................ 27 24 97 66 Pipelines .................................. 37 30 35 30 Other ...................................... -- -- 44 37 Corporate and Unallocated Administrative and general expense ......... (32) (23) (42) (27) Net interest expense ....................... (66) (50) (83) (65) Environmental and litigation expense ....... (100) (63) (34) (21) New Ventures (non-E&P)...................... (19) (12) (31) (22) Other ...................................... 4 4 (31) (20) - -------------------------------------------------------------------------------------------------- Earnings from continuing operations before discontinued operations and extraordinary item ........................ 261 123 586 344 Loss from discontinued operations ................ -- -- (71) (44) Extraordinary item ............................... -- -- (52) (38) - -------------------------------------------------------------------------------------------------- Total ................................ $ 261 $ 123 $ 463 $ 262 ==================================================================================================
Table 10
UNOCAL CORPORATION SPECIAL ADJUSTMENTS (Unaudited) Six Months Ended Six Months Ended June 30, 1998 June 30, 1997 --------------------------------------------- Millions of dollars Before-tax After-tax Before-tax After-tax - -------------------------------------------------------------------------------------------------- Reported earnings ................................ $ 261 $ 123 $ 463 $ 262 Less: Special items Exploration and Production United States Spirit Energy Asset sales ........................ -- -- 3 2 International Asset sales ........................ 85 53 (16) (16) Bangladesh well blowout ............ -- -- (10) (7) Deferred tax adjustment ............ -- (14) -- -- Geothermal and Power Operations Deferred tax adjustment - Sarulla .. -- -- -- 7 Diversified Business Group Carbon and Minerals Asset sales ........................ -- -- 67 41 Environmental and litigation ....... (4) (2) -- -- Other UNO-VEN restructuring .............. -- -- 46 39 Corporate and Unallocated Asset sales ........................ -- -- 7 5 Environmental and litigation ....... (94) (59) (23) (14) Insurance settlement ............... 17 11 -- -- Discontinued Operations Net loss on disposal ............... -- -- (71) (44) Extraordinary item Extinguishment of debt ............. -- -- (52) (38) - -------------------------------------------------------------------------------------------------- Total special items ......................... 4 (11) (49) (25) - -------------------------------------------------------------------------------------------------- Adjusted earnings ....................... $ 257 $ 134 $ 512 $ 287 ==================================================================================================
Table 11
UNOCAL CORPORATION EARNINGS BY BUSINESS SEGMENT EXCLUDING SPECIAL ADJUSTMENTS (Unaudited) Six Months Ended Six Months Ended June 30, 1998 June 30, 1997 --------------------------------------------- Millions of dollars except share amounts Before-tax After-tax Before-tax After-tax - -------------------------------------------------------------------------------------------------- Exploration and Production United States . Spirit Energy 76 .......................... $ 40 $ 25 $ 201 $ 126 Alaska .................................... 21 13 51 32 International ................................ 173 77 292 153 Global Trade ..................................... 16 10 19 11 Geothermal and Power Operations .................. 44 28 21 12 Diversified Business Group Agricultural Products ...................... 31 21 70 46 Carbon and Minerals ........................ 31 26 30 25 Pipelines .................................. 37 30 35 30 Other ...................................... -- -- (2) (2) Corporate and Unallocated Administrative and general expense ......... (32) (23) (42) (27) Net interest expense ....................... (66) (50) (83) (65) Environmental and litigation expense ....... (6) (4) (11) (7) New Ventures (non-E&P) ..................... (19) (12) (31) (22) Other ...................................... (13) (7) (38) (25) - -------------------------------------------------------------------------------------------------- Earnings from continuing operations .............. $ 257 $ 134 $ 512 $ 287 ================================================================================================== Basic earnings from continuing operations per share of common stock ..................... $ 0.56 $ 1.15 Diluted earnings from continuing operations per share of common stock (a) ................. $ 0.55 $ 1.13 Distributions on preferred securities (net of tax) excluded in numerator for diluted earnings per share (a) $ -- $ 12 Basic weighted average shares .................... 241 250 Diluted weighted average shares .................. 243 264 (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: July 28, 1998 By: /s/ JOE D. CECIL - --------------------- --------------------------- Joe D. Cecil Vice President and Comptroller -----END PRIVACY-ENHANCED MESSAGE-----