UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D C 20549
FORM 10-Q
(X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 1996
OR
( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from to
Commission File Number 1-1463
UNION CARBIDE CORPORATION
(Exact name of registrant as specified in its charter)
New York 13-1421730
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
39 Old Ridgebury Road, Danbury, CT 06817-0001
(Address of principal executive offices) (Zip Code)
203-794-2000
Registrant's telephone number, including area code
(Former name, former address and former fiscal year,
if changed since last report.)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days. Yes X No _______
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
Class Outstanding at April 30, 1996
Common Stock, $1 par value 133,671,551 shares
Total number of sequentially numbered pages in this filing,
including exhibits thereto: 19
INDEX
PART I. FINANCIAL INFORMATION
PAGE
Financial Statements
Condensed Consolidated Statement of Income -
Union Carbide Corporation and Subsidiaries -
Quarter Ended March 31, 1996 and 1995........................ 3
Condensed Consolidated Balance Sheet - Union Carbide
Corporation and Subsidiaries - March 31, 1996 and
December 31, 1995............................................ 4
Condensed Consolidated Statement of Cash Flows -
Union Carbide Corporation and Subsidiaries -
Quarter Ended March 31, 1996 and 1995......................... 5
Notes to Condensed Consolidated Financial Statements -
Union Carbide Corporation and Subsidiaries................... 6-9
Discussion and Analysis of Results of Operations
and Financial Condition........................................ 10-13
PART II. OTHER INFORMATION
Item 1. Legal Proceedings....................................... 14
Item 4. Submission of Matters to a Vote of Security Holders..... 14
Item 6. Exhibits and Reports on Form 8-K........................ 15
Signature........................................................ 16
Exhibit Index.................................................... 17
PART I. FINANCIAL INFORMATION
UNION CARBIDE CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF INCOME
Millions of dollars
(Except per share figures)
Quarter ended March 31,
1996 1995
NET SALES $ 1,501 $ 1,453
Cost of sales, exclusive of depreciation and
amortization 1,099 999
Research and development 36 36
Selling, administration and other expenses(a) 81 75
Depreciation and amortization 75 83
Interest expense 23 19
Partnership income (26) (44)
Other income - net (23) (37)
INCOME BEFORE PROVISION FOR INCOME TAXES 236 322
Provision for income taxes 66 97
INCOME OF CONSOLIDATED COMPANIES 170 225
Income (loss) from corporate investments
carried at equity (13) 5
NET INCOME 157 230
Preferred stock dividend, net of income taxes 2 2
NET INCOME - COMMON STOCKHOLDERS $ 155 $ 228
Earnings per common share
Primary $ 1.11 $ 1.57
Fully diluted $ 1.01 $ 1.43
Cash dividends declared per common share $ 0.1875 $ 0.1875
(a) Selling, administration and other expenses include:
Selling $ 32 $ 31
Administration 31 28
Other expenses 18 16
$ 81 $ 75
The Notes to Condensed Consolidated Financial Statements on Pages 6 through 9
should be read in conjunction with this statement.
UNION CARBIDE CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEET
Millions of dollars
March 31, Dec. 31,
1996 1995
ASSETS
Cash and cash equivalents $ 144 $ 449
Notes and accounts receivable 1,061 996
Inventories 546 544
Other current assets 142 207
Total current assets 1,893 2,196
Property, plant and equipment 6,758 6,357
Less: Accumulated depreciation 3,632 3,549
Net fixed assets 3,126 2,808
Companies carried at equity 724 739
Other investments and advances 103 84
Total investments and advances 827 823
Other assets 468 429
Total assets $6,314 $6,256
LIABILITIES AND STOCKHOLDERS' EQUITY
Accounts payable $ 327 $ 316
Short-term debt and current portion of
long-term debt 35 38
Accrued income and other taxes 230 259
Other accrued liabilities 645 725
Total current liabilities 1,237 1,338
Long-term debt 1,289 1,285
Postretirement benefit obligation 485 480
Other long-term obligations 845 834
Deferred credits 260 201
Minority stockholders' equity in consolidated
subsidiaries 26 24
Convertible preferred stock - ESOP 145 146
Unearned employee compensation - ESOP (96) (97)
UCC stockholders' equity:
Common stock authorized - 500,000,000 shares
Common stock issued - 154,609,669 shares 155 155
Additional paid-in capital 329 343
Translation and other equity adjustments (9) (15)
Retained earnings 2,275 2,145
2,750 2,628
Less: Treasury stock, at cost-20,229,053 shares
(19,501,701 shares in 1995) 627 583
Total UCC stockholders' equity 2,123 2,045
Total liabilities and stockholders' equity $6,314 $6,256
The Notes to Condensed Consolidated Financial Statements on Pages 6 through 9
should be read in conjunction with this statement.
UNION CARBIDE CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
Millions of dollars
Quarter ended March 31,
1996 1995
Increase (decrease) in
cash and cash equivalents
OPERATIONS
Income $ 157 $ 230
Noncash charges (credits) to net income
Depreciation and amortization 75 83
Deferred income taxes 32 (67)
Other noncash charges - 184
Net gains on investing transactions (2) (218)
Increase in working capital(a) (79) (235)
Long-term assets and liabilities 30 15
Cash Flow From (Used for) Operations 213 (8)
INVESTING
Capital expenditures (186) (83)
Investments and acquisitions (excluding
cash acquired) (259) (302)
Sale of investments - 343
Sale of fixed and other assets 6 -
Cash Flow Used for Investing (439) (42)
FINANCING
Change in short-term debt (three months or less) 9 247
Proceeds from short-term debt 10 -
Repayment of short-term debt (16) -
Proceeds from long-term debt - 2
Repayment of long-term debt (2) (6)
Issuance of common stock 25 24
Purchase of common stock (78) (226)
Payment of dividends (28) (29)
Other 1 1
Cash Flow From (Used for) Financing (79) 13
Change in cash and cash equivalents (305) (37)
Cash and cash equivalents beginning-of-period 449 109
Cash and cash equivalents end-of-period $ 144 $ 72
Cash paid for interest and income taxes
Interest (net of amount capitalized) $ 12 $ 22
Income taxes $ 2 $ 69
_____________
(a) Net change in certain components of working capital (excluding
non-cash expenditures):
(Increase) decrease in current assets
Notes and accounts receivable $ (20) $(149)
Inventories 38 (18)
Other current assets 22 4
Decrease in payables and accruals (119) (72)
Increase in working capital $ (79) $(235)
The Notes to Condensed Consolidated Financial Statements on Pages 6 through 9
should be read in conjunction with this statement.
UNION CARBIDE CORPORATION AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1. Consolidated Financial Statements
In the opinion of management, the accompanying unaudited condensed
consolidated financial statements include all adjustments necessary for a
fair statement of the results for the interim periods. These adjustments
consist of only normal recurring adjustments. The accompanying
statements should be read in conjunction with the Notes to Financial
Statements of Union Carbide Corporation and Subsidiaries ("the
corporation" or "UCC") in the 1995 annual report to stockholders.
2. Acquisitions
On January 18, 1996, the corporation completed the purchase of the
polypropylene assets and business of Shell Oil Company. The purchased
assets, located in the U.S., comprise Shell's polypropylene technology and
manufacturing facilities and polypropylene assets previously held jointly
by both companies. Additionally, on February 28, 1996, the corporation
completed the purchase of 95 percent of the outstanding shares of
Companhia Alcoolquimica Nacional, a Brazilian producer of vinyl acetate
monomer. The polypropylene resin business is part of the Basic Chemicals
& Polymers Segment, while the polypropylene licensing and catalyst
businesses and the Brazilian vinyl acetate monomer business are included
within the Specialties & Intermediates Segment.
3. Common Stock
Through March 31, 1996, since inception of its 40 million common share
repurchase program, the corporation repurchased 31,439,578 shares
(2,000,100 during the first quarter of 1996) at an average effective price
of $28.938 per share. The corporation will continue to acquire additional
shares from time to time at prevailing market prices, at a rate consistent
with the combination of corporate cash flow and market conditions.
In conjunction with the corporation's common stock buyback program, put
options were sold in a series of private placements entitling the holders
to sell 7.1 million shares of common stock to UCC, at specified prices
upon exercise of the options. Since inception of this program, through
March 31, 1996, options representing 5,263,800 common shares have expired
unexercised, while options representing 1,136,200 shares were exercised
for $35 million, or an average price of $30.86 per share. Options
representing 722,581 shares remain outstanding at March 31, 1996.
Premiums received since the inception of the program have reduced the
average price of repurchased shares from $29.142 per share to $28.938 per
share.
4. Inventories
Millions of dollars
Mar. 31, Dec. 31,
1996 1995
Raw materials and supplies $ 109 $ 117
Work in process 48 46
Finished goods 389 381
$ 546 $ 544
5. Commitments and Contingencies
The corporation has entered into 3 major agreements for the purchase of
ethylene-related products and 3 other purchase agreements in the U.S. and
Canada. The net present value of the fixed and determinable portion of
these obligations at March 31, 1996 totaled $385 million.
The corporation is subject to loss contingencies resulting from
environmental laws and regulations, which include obligations to remove or
mitigate the effects on the environment of the disposal or release of
certain wastes and substances at various sites. The corporation has
established accruals in current dollars for those hazardous waste sites
where it is probable that a loss has been incurred and the amount of the
loss can be reasonably estimated. The reliability and precision of the
loss estimates are affected by numerous factors, such as different stages
of site evaluation, the allocation of responsibility among potentially
responsible parties and the assertion of additional claims. The
corporation adjusts its accruals as new remediation requirements are
defined, as information becomes available permitting reasonable estimates
to be made, and to reflect new and changing facts.
At March 31, 1996, the corporation had established environmental remediation
accruals in the amount of $332 million. These accruals have two components,
estimated future expenditures for site investigation/cleanup and estimated
future expenditures for closure/postclosure activities. In addition, the
corporation had environmental loss contingencies of $163 million.
The corporation has sole responsibility for the remediation of
approximately half of its environmental sites. These sites are well
advanced in the investigation/cleanup stage. The corporation's
environmental accruals at March 31, 1996 included $250 million for these
sites, of which $117 million was for estimated future expenditures for
site investigation/cleanup and $133 million was for estimated future
expenditures for closure/postclosure activities. In addition, $83 million
of the corporation's environmental loss contingencies related to these
sites. The site with the largest total potential cost to the corporation
is a non-operating site. Of the above accruals, this site accounted for
$47 million, of which $26 million was for estimated future expenditures
for site investigation/cleanup and $21 million was for estimated future
expenditures for closure/postclosure activities. In addition, $15 million
of the above environmental loss contingencies related to this site.
The corporation does not have sole responsibility at the remainder of its
environmental sites. All of these sites are in the investigation/cleanup
stage. The corporation's environmental accruals at March 31, 1996
included $82 million for estimated future expenditures for site
investigation/cleanup at these sites. In addition, $80 million of the
corporation's environmental loss contingencies related to these sites.
The largest two of these sites are also non-operating sites. Of the above
accruals, these sites accounted for $25 million for estimated future
expenditures for site investigation/cleanup. In addition, $25 million of
the above environmental loss contingencies related to these sites.
In 1995, worldwide expenses of continuing operations related to
environmental protection for compliance with Federal, state and local laws
regulating solid and hazardous wastes and discharge of materials to air
and water, as well as for waste site remedial activities, totaled $138
million. Expenses in 1994 and 1993 were $153 million and $149 million,
respectively. While estimates of the costs of environmental protection
for 1996 are necessarily imprecise, the corporation estimates that the
level of these expenses will not change materially.
At March 31, 1996, the corporation had invested approximately $137 million
on behalf of Equate Petrochemical Company K.S.C., its Kuwaiti joint
venture, and had severally guaranteed up to $225 million of Equate debt.
Additional significant commitments are anticipated.
The corporation had additional contingent obligations at March 31, 1996 of
$53 million, principally related to obligations assumed by purchasers of
UCC facilities for which UCC is primarily liable, discounted receivables
from customers, guarantees of debt and performance agreements.
The corporation is one of a number of defendants named in approximately
4,600 lawsuits, some of which have more than one plaintiff, involving
silicone breast implants. The corporation was not a manufacturer of
breast implants but did supply generic bulk silicone materials to certain
manufacturers. Also, the corporation in 1990 acquired and in 1992
divested the stock of a small specialty silicones company that, among
other things, supplied silicone gel intermediates and silicone
dispersions for breast implants. In 1993, most of the suits that were
brought in Federal courts were consolidated for pre-trial purposes in the
United States District Court, Northern District of Alabama. In 1994, the
corporation provisionally joined a multi-billion dollar settlement of the
claims consolidated in that Court.
Subsequently, the District Court determined that the total amount of
current claims likely to be approved for payment under the original
settlement schedule would substantially exceed the funds available.
Consequently, the defendants and the Plaintiffs' Negotiating Committee, at
the request of the court, initiated negotiations to reconsider the
structure and funding of the settlement. Recently certain defendants,
including the corporation, proposed, and the court approved, a revised
settlement program. While the corporation cannot predict the number of
claimants who will participate in the settlement, based on sample data
prepared under supervision of the court, the corporation estimates that
its maximum expenditures under the revised agreement should not exceed
$100 million prior to insurance recovery. Although insurance coverage is
subject to issues as to scope and application of policies, retention
limits, exclusions and policy limits, and the insurers have reserved their
right to deny coverage, the corporation believes that after probable
insurance recoveries neither the settlement nor litigation outside the
settlement will have a material adverse effect on the consolidated
financial position of the corporation.
In addition to the above, the corporation and its consolidated subsidiaries
are involved in a number of legal proceedings and claims with both private
and governmental parties. These cover a wide range of matters including,
but not limited to: product liability; governmental regulatory proceedings;
health, safety and environmental matters; employment; patents; contracts
and taxes. In some of these legal proceedings and claims, the cost of
remedies that may be sought or damages claimed is substantial.
The corporation has recorded nonenvironmental litigation accruals of
$228 million, and related insurance recovery receivables of $134 million,
resulting in net before-tax charges of $94 million for nonenvironmental
litigation. At March 31, 1996, the corporation had nonenvironmental
litigation loss contingencies of $42 million.
While it is impossible at this time to determine with certainty the
ultimate outcome of any legal proceedings and claims referred to in this
note, management believes that adequate provisions have been made for
probable losses with respect thereto and that such ultimate outcome, after
provisions therefor, will not have a material adverse effect on the
consolidated financial position of the corporation but could have a
material effect on consolidated results of operations in a given quarter
or year. Should any losses be sustained in connection with any of such
legal proceedings and claims, in excess of provisions therefor, they will
be charged to income in the future.
DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS
AND FINANCIAL CONDITION
Overview
The corporation reported first quarter, 1996 net income available to common
stockholders of $155 million, or $1.01 per share, fully diluted ($1.11 per
share, primary). For the corresponding quarter in 1995 the corporation
reported earnings of $228 million, or $1.43 per share, fully diluted ($1.57
per share, primary).
The corporation's earnings for the quarter ending March 31, 1996 were affected
by a significant increase in feedstock prices and lower prices for some key
products, and weather-related problems that affected operations. First
quarter margins were lower than those of the corresponding prior year period.
The Specialties & Intermediates segment experienced temporary operating
problems at certain facilities and a decline in export prices for key
products, while benefiting from increased licensing revenue, compared to the
first quarter of 1995. The Basic Chemicals & Polymers segment was affected by
reduced demand for ethylene glycol and continued weak pricing in polyethylene,
although polyethylene shipments were very strong. Polyethylene pricing also
adversely affected the corporation's income from partnerships and European
joint ventures.
The outlook for the Specialties & Intermediates Segment is good, although
licensing revenues are not likely to be as strong in the second quarter as
they were in the first. Although it is impossible to forecast the level of
future prices for the major Basic Chemicals & Polymers product lines, the
corporation anticipates that polyethylene prices will strengthen over the
remainder of the year. While ethylene glycol price nominations are holding
domestically and are up in Asia, significant uncertainty exists as to their
future direction.
Results of Operations
Sales increased 3.3 percent in the first quarter, compared to the same period
of 1995, principally due to the addition of polypropylene revenues. Prices
were lower on a quarter-to-quarter basis. Quarterly volumes increased
6.9 percent, in comparison to the corresponding prior period.
The corporation's variable margin for the first quarter of 1996 was
45.4 percent, compared to 50.0 percent in the first quarter of 1995,
principally due to lower polyethylene prices. The current quarter's gross
margin (variable margin less fixed manufacturing and distribution costs)
declined in comparison to the first quarter of 1995 reflecting the decreased
variable margin coupled with relatively modest increases in fixed
manufacturing and distribution costs. Fixed manufacturing and distribution
costs increased 3.3 percent versus the prior year quarter primarily due to the
acquisition of Shell Oil Company's polypropylene assets and business.
Industry Segments
The company's operations are classified into two main business segments,
Specialties & Intermediates and Basic Chemicals & Polymers. The Specialties &
Intermediates Segment includes the corporation's specialty chemicals and
specialty polymers product lines, licensing and solvents and chemical
intermediates. The Basic Chemicals & Polymers Segment includes the
corporation's ethylene and propylene manufacturing operations as well as the
production of first level ethylene and propylene derivatives - polyethylene
and ethylene oxide/glycol and polypropylene. The corporation's non-core
operations and financial transactions are included in "Other".
Information about the corporation's operations in its business segments for
the first quarter of 1996 and 1995 follows. Sales of the Basic Chemicals &
Polymers Segment include intersegment sales, principally ethylene oxide, which
are made at the estimated market value of the products transferred. Operating
profit represents income before interest expense and the provision for income
taxes.
Millions of dollars
Quarter ended March 31,
1996 1995
Sales
Specialties & Intermediates $1,077 $1,047
Basic Chemicals & Polymers 519 468
Intersegment Eliminations (95) (62)
Total $1,501 $1,453
Operating Profit
Specialties & Intermediates $ 193 $ 210
Basic Chemicals & Polymers 58 108
Other 8 23
Total $ 259 $ 341
Depreciation and Amortization
Specialties & Intermediates $ 46 $ 55
Basic Chemicals & Polymers 29 28
Total $ 75 $ 83
Capital Expenditures
Specialties & Intermediates $ 134 $ 61
Basic Chemicals & Polymers 52 22
Total $ 186 $ 83
Sales of the Specialties & Intermediates Segment increased 2.9 percent to
$1,077 million in the first quarter of 1996 over that of 1995. Operating
profit for the first quarter of 1996 was $193 million, versus $210 million for
the comparable quarter of 1995, which included an increase of $12 million in
depreciation expense related to a reduction in the depreciable lives of
certain computer equipment. Increases in average selling prices and volumes
accounted for the sales increase.
Sales of the Basic Chemicals & Polymers Segment increased 10.9 percent to
$519 million in the first quarter of 1996 from $468 million in the comparable
quarter of 1995. Operating profit for the first quarter of 1996 declined to
$58 million from $108 million. The sales increase is attributable to increased
volume in polyethylene and from the newly acquired polypropylene assets and
business, offset by a decline in average selling prices.
Selling, administrative and other expenses were $81 million in the first
quarter of 1996, versus $75 million in the first quarter of 1995.
Partnership income decreased $18 million in the first quarter of 1996 versus
the comparable quarter in 1995, as the result of decreased earnings for
Petromont due to lower polyethylene prices; a decline in the earnings of UOP
due to normal variations in quarterly sales activity; and the elimination of
the earnings of the polypropylene partnership with Shell Oil Company, which
was acquired during the current quarter and is now included in consolidated
earnings.
Other income - net for the first quarter of 1995 included the following items:
a $220 million gain on the corporation's reduction of its equity interest in
UCAR and a non-cash charge of $191 million for future minimum lease payments
on unused office space, primarily at the corporation's Danbury headquarters.
The headquarters charge reflects the pro rata costs of unused office space
over the remaining term of the lease, which runs to 2006, less anticipated net
sublease income. Neither the expected future costs nor expected net sub-lease
revenues were discounted.
Interest expense increased $4 million in the first quarter of 1996 when
compared to the same period last year reflecting increased borrowings.
Estimates of future expenses related to environmental protection for
compliance with Federal, state and local laws regulating solid and hazardous
wastes and discharge of materials to air and water, as well as for waste site
remedial activities, and of future capital expenditures relating to
environmental protection, have not changed materially since December 31, 1995.
The reliability and precision of the loss estimates are affected by numerous
factors, such as different stages of site evaluation, the allocation of
responsibility among potentially responsible parties and the assertion of
additional claims. The corporation's environmental exposures are discussed in
more detail in the Commitments and Contingencies footnote to the financial
statements on pages 7 through 9 of this report on Form 10-Q.
The corporation continues to be named as one of a number of defendants in
lawsuits, some of which have more than one plaintiff, involving silicone gel
breast implants. The corporation supplied bulk silicone materials to certain
companies that at various times were involved in the manufacture of breast
implants. These cases are discussed in more detail in the "Commitments and
Contingencies" footnote to the financial statements on pages 7 through 9 of
this report on Form 10-Q.
Financial Condition - March 31, 1996
Cash flow from operations was $213 million for the first quarter of 1996,
compared to $8 million used for operations in the comparable quarter of 1995.
Decreased earnings in the first quarter of 1996 versus the first quarter of
1995 were offset by a smaller increase in working capital requirements as well
as reduced tax payments. Net gains on investing transactions had been
significantly higher in the first quarter of 1995 because of the gain on the
reduction of the corporation's equity interest in UCAR during that quarter.
Other noncash charges of $184 million in the first three months of 1995
included the $191 million charge for future lease payments on unused office
space.
Cash flow used for investing totaled $439 million in the first three months of
1996, and $42 million in the first three months of 1995. In the first quarter
of 1996, the corporation purchased the polypropylene assets and business of
Shell Oil Company and 95 percent of the outstanding shares of Companhia
Alcoolquimica Nacional, a Brazilian producer of vinyl acetate monomer. In the
prior year's first quarter, investments and acquisitions included the
acquisitions of a 50 percent interest in Polimeri Europa and the ethylene
oxide derivatives businesses of ICI, while sale of investments reflected the
sale of half of the corporation's 50 percent equity interest in UCAR
International Inc.
Capital expenditures increased to $186 million in the first quarter of 1996 in
comparison to $83 million in the first quarter of 1995. Major projects
include an ethylene propylene rubber project at Seadrift, Tex., within the
Specialties & Intermediates Segment; a cogeneration facility at Taft, La.,
within both business segments; and an upgrade to the information technology
infrastructure, which involves all segments.
Cash flow used for financing in the first quarter of 1996 was $79 million,
versus cash flow from financing in the first quarter of 1995 of $13 million.
The 1996 quarter included net common stock repurchases of $53 million, while
the 1995 quarter was impacted by increased short-term borrowings and net
common stock repurchases of $202 million.
The corporation's ratio of debt to total capital declined to 38.1 percent at
March 31, 1996 from 39.0 percent at December 31, 1995. At March 31, 1996,
there were no outstanding borrowings under the existing major bank credit
agreement aggregating $1 billion.
Cash dividends to UCC common stockholders amounted to $28 million and $29
million in the first quarter of 1996 and 1995, respectively.
At March 31, 1996, the corporation had invested approximately $137 million on
behalf of Equate Petrochemical Company K.S.C., its Kuwaiti joint venture, and
had severally guaranteed up to $225 million of Equate debt. Additional
significant commitments are anticipated.
PART II. OTHER INFORMATION
Item 1. Legal Proceedings
See Note 5 to the corporation's consolidated financial statements
on pages 7 through 9 of this 10-Q Report.
Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
(a) Annual Meeting - April 24, 1996
(b) Proxies for the meeting were solicited pursuant to Regulation
14A. There was no solicitation in opposition to the
management's nominees as listed in the proxy statement. All of
the management's nominees as listed in the proxy statement were
elected, the vote on said proposal being as follows:
Shares Voted
Directors Shares For Shares Withheld
John J. Creedon 128,964,844 1,431,566
C. Fred Fetterolf 129,253,950 1,142,460
Joseph E. Geoghan 128,843,321 1,553,089
Rainer E. Gut 129,296,391 1,100,019
Vernon E. Jordan, Jr. 127,462,977 2,933,433
William H. Joyce 128,710,161 1,686,249
Robert D. Kennedy 128,586,402 1,810,008
Ronald L. Kuehn, Jr. 129,301,537 1,094,873
Rozanne L. Ridgway 129,214,461 1,181,949
William S. Sneath 126,880,487 3,515,923
(c) Other matters voted upon.
Proposal to Ratify the Appointment of Auditors
Shareholders ratified the appointment of KPMG Peat Marwick LLP
to conduct the annual audit of the financial statements of the
corporation and its consolidated subsidiary companies for the
year ending December 31, 1996.
The vote was:
FOR - 129,019,883 shares or 99.55 percent of the shares voted.
AGAINST - 586,918 shares or 0.45 percent of the shares voted.
ABSTAIN - 789,609 shares.
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits.
The following exhibits are filed as part of this report:
11 - Computation of Earnings Per Share
27 - Financial Data Schedule.
(b) No reports on Form 8-K were filed for the three months ended
March 31, 1996.
SIGNATURE
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.
UNION CARBIDE CORPORATION
(Registrant)
Date: May 13, 1996 By: /s/John K. Wulff
JOHN K. WULFF
Vice-President and
Chief Financial Officer
EXHIBIT INDEX
Exhibit Page
No. Exhibit No.
11 Computation of Earnings Per Share 18
27 Financial Data Schedule 19
Exhibit 11
UNION CARBIDE CORPORATION AND SUBSIDIARIES
COMPUTATION OF EARNINGS PER SHARE
(In millions of dollars, except per share amounts)
Quarter Ended March 31,
1996 1995
Earnings Per Share - Primary
Income $ 157 $ 230
Less: Preferred stock dividend 3 2
Net income for primary income calculation $ 154 $ 228
Weighted average number of common
and common equivalent shares applicable
to primary earnings per share calculation
Weighted average number of shares outstanding 134,502,414 140,864,894
Dilutive effect of stock options 4,739,654 4,026,981
139,242,068 144,891,875
Earnings per share - primary $ 1.11 $ 1.57
Earnings Per Share - Fully Diluted
Income $ 157 $ 230
Weighted average number of common
and common equivalent shares applicable to
fully diluted earnings per share calculation
Weighted average number of shares outstanding 134,502,414 140,864,894
Dilutive effect of stock options 5,158,254 4,319,636
Shares issuable upon conversion of UCC
convertible preferred stock 16,200,160 16,428,411
155,860,828 161,612,941
Earnings per share - fully diluted $ 1.01 $ 1.43
- - 18 -
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
EXHIBIT 27 - FINANCIAL DATA SCHEDULE - UNION CARBIDE CORPORATION
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM UNION
CARBIDE CORPORATION'S FORM 10-Q FOR THE QUARTER ENDED MARCH 31, 1996 AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000100790
<NAME> UNION CARBIDE CORPORATION
<MULTIPLIER> 1,000,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> MAR-31-1996
<CASH> 144
<SECURITIES> 0
<RECEIVABLES> 1072
<ALLOWANCES> 11
<INVENTORY> 546
<CURRENT-ASSETS> 1893
<PP&E> 6758
<DEPRECIATION> 3632
<TOTAL-ASSETS> 6314
<CURRENT-LIABILITIES> 1237
<BONDS> 1289
0
145
<COMMON> 155
<OTHER-SE> 1968
<TOTAL-LIABILITY-AND-EQUITY> 6314
<SALES> 1501
<TOTAL-REVENUES> 1501
<CGS> 1099
<TOTAL-COSTS> 1099
<OTHER-EXPENSES> 111
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 23
<INCOME-PRETAX> 236
<INCOME-TAX> 66
<INCOME-CONTINUING> 157
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 155
<EPS-PRIMARY> 1.11
<EPS-DILUTED> 1.01
</TABLE>
