SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 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)
May 1, 2000
UNION CARBIDE CORPORATION
(Exact name of registrant as specified in its charter)
New York 1-1463 13-1421730
(State or other (Commission File Number) (IRS Employer
jurisdiction of Identification No.)
incorporation)
39 Old Ridgebury Rd, Danbury, CT 06817-0001
(Address of principal executive offices) (Zip code)
Registrant's telephone number,
including area code 203-794-2000
Total number of sequentially numbered pages in this filing,
including exhibits thereto: 10
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Item 5. OTHER EVENTS.
See Union Carbide Corporation's press release dated
May 1, 2000 accompanying this report as Exhibit 99.
Item 7. FINANCIAL STATEMENTS AND EXHIBITS
(C) Exhibits.
99. Press release, May 1, 2000.
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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 hereunto duly authorized.
Date: May 1, 2000
UNION CARBIDE CORPORATION
/s/J. Macdonald
J. Macdonald
Assistant Secretary
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EXHIBIT INDEX
Exhibits
99. Press release, dated May 1, 2000.
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EXHIBIT 99
UNION CARBIDE CORPORATION
NEWS RELEASE
CONTACT: Sean S. Clancy
203-794-6976
UNION CARBIDE REPORTS SOLID 1ST QUARTER EARNINGS
DANBURY, Conn., May 1 -- Union Carbide Corporation (UCC) today reported
first quarter 2000 earnings of $0.71 per diluted common share, compared to
$0.68 in the fourth quarter of 1999 and $0.56 for the same period in 1999
before the cumulative effect of a change in accounting principle.
"Our financial performance in the current quarter reflected lower Basic
Chemicals and Polymers (BC&P) earnings, partially offset by actuarial changes
in our pension plan and by the absence of losses in Carbide's Other segment
that unfavorably impacted the fourth quarter of 1999," said Dr. William H.
Joyce, Carbide's Chairman and Chief Executive Officer. "Price increases were
achieved in both the BC&P and Specialties & Intermediates (S&I) business
segments, but were insufficient to offset the rise in raw material costs.
"I am particularly pleased by the continued strong performance of our
equity companies," Dr. Joyce continued. "Their earnings improvement from a
year ago more than offset the decline in consolidated variable margin since
the first quarter of 1999 and was the most significant factor contributing to
our 27 percent improvement in earnings per share."
Net income available to common stockholders for the quarter totaled $97
million, compared to $94 million in the fourth quarter of 1999 and $77 million
for the same period a year
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2000
P3-01-009
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ago before the cumulative effect of a change in accounting principle. Sales
in the first quarter totaled $1.617 billion, compared to $1.552 billion in the
prior quarter and $1.402 billion for the same period in 1999.
UCC's Specialties & Intermediates (S&I) segment reported operating profit
of $82 million, compared to $77 million in the fourth quarter of 1999 and $208
million in the first quarter of 1999. Price increases and improvements in
fixed costs and in partnership results compared to fourth quarter were largely
offset by increased raw material costs.
Carbide's BC&P segment reported operating profit of $30 million, compared
to $61 million in the fourth quarter of 1999 and an operating loss of $33
million in the first quarter of 1999.
Carbide's Other segment reported a current quarter gain of $4 million,
after reporting a $30 million loss in the fourth quarter 1999 that was
primarily the result of environmental expenses of a discontinued business.
Required changes in actuarial assumptions affecting the pension plan
contributed $0.10 per diluted share compared to fourth quarter 1999.
"If raw material prices continue the trend we've seen in April, we should
see further improvement in earnings as price increases in BC&P and S&I
continue to take hold and margins improve," stated Dr. Joyce. "On balance,
the contribution to earnings from our partnerships and equity companies should
be somewhat higher than in the first quarter, largely because of continued
improvement in partnership income."
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Union Carbide is a worldwide chemicals company with advanced process
technologies and large-scale chemical production facilities. The
corporation's two business segments are:
- Specialties & Intermediates -- Union Carbide is the leading North
American supplier of solvents and intermediates to the paint and coatings
industry; the leading licensor of several technologies; and a leading supplier
of specialty chemicals, polymers and services used in the personal care
products, pharmaceuticals, automotive, wire and cable, oil and gas and
industrial lubricants industries.
- Basic Chemicals & Polymers -- Union Carbide is among the largest
manufacturers of polyethylene, the world's most widely used plastic, and the
technology leader in this industry; and a large manufacturer of polypropylene,
one of the world's fastest-growing, large-volume plastics. UCC is also the
world's largest producer of ethylene oxide and its derivative ethylene glycol,
used for polyester fiber, resin and film, automotive antifreeze and other
products.
Cautionary Statement for Purposes of the "Safe Harbor" Provisions
Of the Private Securities Litigation Act of 1995
Those statements in the preceding pages that do not reflect historical
information are forward looking statements. Forward looking statements
include, but are not limited to, statements concerning anticipated future
events or performance, raw material costs, anticipated price increases, cost
improvements, margins and earnings expectations. Naturally, such forward
looking statements are subject to risks and uncertainties. In addition to all
specific assumptions cited, important factors that could cause results to
differ materially from those discussed in such forward-looking statements
include: the supply/demand balance for the corporation's products, customer
inventory levels, competitive pricing pressures, feedstock availability and
costs, changes in industry production capacities and operating rates, currency
exchange rates, interest rates, global economic conditions, disruption in
transportation facilities, competitive technology positions, failure by the
corporation to achieve technology objectives, achieve cost reduction targets,
or complete projects on schedule or within budget, and an inability to obtain
new customers or retain existing ones.
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<TABLE>
UNION CARBIDE CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF INCOME
<CAPTION>
Quarter Ended
Mar. 31, Dec. 31, Mar. 31,
Millions of Dollars, Except Per Share Amounts 2000 1999 1999
<S> <C> <C> <C>
NET SALES $1,617 $1,552 $1,402
Cost of sales, exclusive of depreciation
and amortization 1,314 1,240 1,032
Research and development 39 40 37
Selling, administrative and other expenses (a) 73 58 70
Depreciation and amortization 102 106 104
Partnership income (loss) 3 (9) 6
Other income - net 24 9 14
INCOME BEFORE INTEREST EXPENSE AND PROVISION
FOR INCOME TAXES 116 108 179
Interest expense 37 35 31
INCOME BEFORE PROVISION FOR INCOME TAXES 79 73 148
Provision for income taxes 20 18 38
INCOME OF CONSOLIDATED COMPANIES AND PARTNERSHIPS 59 55 110
Minority interest 1 1 1
Income (loss) from corporate investments
carried at equity 39 40 (32)
INCOME BEFORE CUMULATIVE EFFECT OF
CHANGE IN ACCOUNTING PRINCIPLE 97 94 77
Cumulative effect of change in accounting
principle - - (20)
NET INCOME $ 97 $ 94 $ 57
Earnings per common share
Basic - Income before cumulative effect of
change in accounting principle $ 0.72 $ 0.70 $ 0.57
- Cumulative effect of change in
accounting principle - - (0.14)
- Net income - common stockholders $ 0.72 $ 0.70 $ 0.43
Based on the indicated number of shares 134,406,055 133,953,770 132,848,490
Diluted - Income before cumulative effect of
change in accounting principle $ 0.71 $ 0.68 $ 0.56
- Cumulative effect of change in
accounting principle - - (0.14)
- Net income - common stockholders $ 0.71 $ 0.68 $ 0.42
Based on the indicated number of shares 137,563,934 137,557,329 135,710,019
(a) Selling $ 23 $ 24 $ 23
Administrative 22 21 25
Other expenses 28 13 22
Total $ 73 $ 58 $ 70
</TABLE>
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<TABLE>
UNION CARBIDE CORPORATION AND SUBSIDIARIES
SEGMENT DATA
<CAPTION>
Quarter Ended
Mar. 31, Dec. 31, Mar. 31,
2000 1999 1999
Millions of dollars, Except As Indicated
<S> <C> <C> <C>
Specialties and Intermediates
Segment revenues $1,108 $1,055 $1,034
Depreciation and amortization 67 70 63
Partnership income (loss) 2 (13) 4
Operating profit 82 77 208
Income (loss) from corporate
investments carried at equity 1 (5) 4
Unit variable margin (cents/pound) 19.0 21.1 26.0
Fixed cost per pound of products
sold (cents/pound) 12.9 14.4 14.1
Capital expenditures 69 71 69
Basic Chemicals & Polymers
Segment revenues $ 608 $ 597 $ 421
Depreciation and amortization 35 36 41
Partnership income (loss) 1 4 2
Operating profit (loss) 30 61 (33)
Income (loss) from corporate
investments carried at equity 38 45 (36)
Unit variable margin (cents/pound) 9.4 11.2 5.6
Fixed cost per pound of products
sold (cents/pound) 6.2 6.7 5.2
Capital expenditures 126 134 104
Other
Operating profit (loss) $ 4 $ (30) $ 4
</TABLE>
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<TABLE>
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<CAPTION>
Union Carbide Corporation
Data Sheet
1Q00 4Q99 1Q99 1Q/4Q 1Q/1Q
Union Carbide Corporation
<S> <C> <C> <C> <C> <C> <C>
Net Sales MM $ $1,617 1,552 1,402 4.2% 15.3%
Customer Volumes MM Lb. 4,198 4,217 4,163 (0.5%) 0.8%
Average Selling Prices Cents/Lb. 38.5 36.8 33.7 4.6% 14.2%
Unit Variable Margin Cents/Lb. 14.6 16.3 16.2 (10.4%) (9.9%)
Fixed Costs MM $ 423 472 413 (10.4%) 2.4%
S&I Segment
Segment Revenues * MM $ 1,108 1,055 1,034 5.0% 7.2%
Customer Volumes MM Lb. 2,288 2,223 2,176 2.9% 5.1%
Average Selling Prices Cents/Lb. 48.4 47.5 47.5 1.9% 1.9%
Unit Variable Margin Cents/Lb. 19.0 21.1 26.0 (10.0%) (26.9%)
Operating Profit MM $ 82 77 208 6.5% (60.6%)
Increase in Raw Material,
Energy & Related
Manufacturing Variable Costs MM $ 91 206
BC&P Segment
Segment Revenues MM $ 608 597 421 1.8% 44.4%
Customer Sales Revenues MM $ 509 497 368 2.4% 38.3%
Customer Volumes MM Lb. 1,910 1,994 1,987 (4.2%) (3.9%)
Average Selling Prices Cents/Lb. 26.7 24.9 18.5 7.2% 44.3%
Unit Variable Margin Cents/Lb. 9.4 11.2 5.6 (16.1%) 67.9%
Operating Profit/Loss MM $ 30 61 (33) (50.8%) 190.9%
Increase in Raw Material,
Energy & Related
Manufacturing Variable Costs MM $ 54 112
Change in Average Selling Prices
BC&P Chemicals Cents/Lb. change 2.1 8.1
BC&P Resins Cents/Lb. change (1.1) 7.4
Change in Customer Volumes
BC&P Chemicals % Change (13.1) (20.0)
BC&P Resins % Change 7.8 5.7
Hydrocarbon By-products % Change (8.6) (2.3)
* Segment Revenues also equals Customer Revenues
</TABLE>
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