<PAGE>
UNITED STATES
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):
July 18, 1995
USX Corporation
- --------------------------------------------------------------------------------
----
(Exact name of registrant as specified in its charter)
Delaware 1-5153 25-0996816
--------------- ------------ -------------------
(State or other (Commission (IRS Employer
jurisdiction of File Number) Identification No.)
incorporation)
600 Grant Street, Pittsburgh, PA 15219-4776
- --------------------------------------- ----------
(Address of principal executive offices) (Zip Code)
(412) 433-1121
------------------------------
(Registrant's telephone number,
including area code)
<PAGE> 2
Item 5. Other Events
On July 18, 1995, the Registrant reported unaudited results for the
second quarter and six months ended June 30, 1995 for each of the
Marathon Group, the U. S. Steel Group and the Delhi Group of USX
Corporation and consolidated results for USX Corporation and
subsidiary companies. The press releases announcing these results and
including condensed financial and operating data are filed herewith as
exhibits.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
(a) Exhibits
99.1 Press Release dated July 18, 1995 with respect to the Marathon Group of USX
Corporation and summary financial and operating data.
99.2 Press Release dated July 18, 1995 with respect to the U. S. Steel Group of
USX Corporation and summary financial and operating data.
99.3 Press Release dated July 18, 1995 with respect to the Delhi Group of USX
Corporation and summary financial and operating data.
Condensed consolidated financial data with respect to USX and subsidiary
companies is included with each press release.
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 hereunto duly authorized.
USX CORPORATION
By s/ Lewis B. Jones
-------------------
Lewis B. Jones
Vice President
& Comptroller
Dated: July 20, 1995
Contact: William E. Keslar
Don H. Herring
(412) 433-6870
FOR IMMEDIATE RELEASE
- ---------------------
USX CORPORATION REPORTS IMPROVED SECOND QUARTER
MARATHON GROUP FINANCIAL RESULTS
PITTSBURGH, July 18, 1995 -- USX Corporation reported improved second
quarter 1995 net income for its Marathon Group (NYSE:MRO) of $108 million, or 37
cents per share, on sales of $3.5 billion. Results included no significant
special items.
Net income in the second quarter of 1994 was $72 million, or 25 cents per
share, on sales of $3.1 billion. These 1994 results included a net $67 million
favorable estimated aftertax effect of special items, mainly a favorable
inventory market valuation adjustment and a favorable effect relating to various
state tax issues.
Second quarter Marathon Group operating income, excluding the effects of
inventory market valuation adjustments, was $251 million in 1995, compared with
$63 million in 1994.
USX Corporation Board Chairman Thomas J. Usher commented, "Both upstream
and downstream operations showed significant improvement over second quarter
1994 results. Worldwide liquids and natural gas volumes were up about 20
percent. Liquid hydrocarbon production increased nearly 37,000 barrels per day
(bpd), while natural gas volumes increased 178 million cubic feet per day
(mmcfd). Prices improved as well. Higher worldwide crude oil prices and
international natural gas prices combined
<PAGE> 2
with continued operating expense control more than offset lower domestic natural
gas prices. Both upstream and downstream operations have benefited from the
cost reduction programs initiated last year. Downstream operations also
reflected a rebound in refined product margins as increased demand,
particularly for gasoline, resulted in a significant improvement over
comparable 1994 results. In addition, results reflected increased retail
sales associated with the 1994 addition of 169 retail outlets by Emro Marketing
Company, a wholly owned subsidiary."
Operating income for worldwide exploration and production totaled $126
million in the second quarter of 1995, compared with $59 million in the second
quarter of 1994.
Domestic upstream reported operating income of $83 million for the second
quarter of 1995, compared with $51 million in the second quarter of 1994. This
increase was mostly due to increased production of natural gas, up 78 mmcfd, and
crude oil, up 23,500 bpd. The impact of lower natural gas prices was partly
offset by higher liquid hydrocarbon prices. The increase in liquid hydrocarbon
volumes was largely attributable to the Ewing Bank 873 Field in the Gulf of
Mexico, which came on stream in August 1994. Marathon also brought on initial
production from the South Pass 87 D platform in the Gulf of Mexico during the
quarter.
International upstream generated operating income of $43 million in the
second quarter of 1995, compared with $8 million in the second quarter of 1994.
Improved results were primarily due to increased liquid hydrocarbon liftings and
natural gas volumes in the U.K., new liquids production in Indonesia and higher
crude oil and natural gas prices. Liftings averaged 66,300 bpd, up 13,300 bpd
from the prior year quarter,
<PAGE> 3
while natural gas volumes of 465 mmcfd were up by 100 mmcfd. The planned
maintenance shut-in of Brae Area North Sea operations extended over a 21 day
period and was timed to coincide with the planned maintenance shutdown of the BP
Forties Pipeline and associated facilities. The shut-in reduced liquids
production by an average of 5,500 net bpd for the quarter.
During the quarter a successful confirmation well was drilled and tested
at the Ras El Ush area in Egypt. Well #3 tested at 4,358 bpd from the Nubia
formation. It also encountered the Matulla sandstone which tested at 3,850 bpd
from Well #2 drilled earlier this year. Marathon anticipates bringing this
discovery on production late in the year.
Refining, marketing and transportation reported operating income of $147
million in the second quarter of 1995, compared with $29 million in the second
quarter of 1994. The strong improvement primarily reflected higher refined
product margins. In addition, refined product sales volumes, excluding buy/sell
transactions, increased by 4 percent from the prior year quarter.
* * * * * * *
Statement of operations and supplemental statistics for the Marathon
Group and consolidated statement of operations for USX Corporation are attached.
Consolidated net income for USX Corporation was $190 million in the second
quarter of 1995, compared with $107 million in the second quarter of 1994.
<PAGE>
<TABLE>
MARATHON GROUP OF USX CORPORATION
STATEMENT OF OPERATIONS (Unaudited)
<CAPTION>
Second Quarter Six Months
Ended Ended
June 30 June 30
(Dollars in millions, except per share data) 1995 1994 1995 1994
- --------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
SALES $3,528 $3,105 $6,865 $5,852
OPERATING COSTS:
Cost of sales (excludes items shown below) 2,230 2,097 4,439 3,867
Inventory market valuation charges
(credits) 2 (93) (86) (221)
Selling, general and administrative
expenses 79 86 152 164
Depreciation, depletion and amortization 209 182 416 353
Taxes other than income taxes 732 642 1,431 1,239
Exploration expenses 27 35 53 68
------- ------- ------- -------
Total operating costs 3,279 2,949 6,405 5,470
------- ------- ------- -------
OPERATING INCOME 249 156 460 382
Other income (loss) 8 (4) 13 18
Interest and other financial income 10 - 13 7
Interest and other financial costs (94) (43) (185) (120)
------- ------- ------- -------
INCOME BEFORE INCOME TAXES 173 109 301 287
Less provision for estimated income taxes 65 37 116 105
------- ------- ------- -------
NET INCOME 108 72 185 182
Dividends on preferred stock (1) (2) (3) (3)
------- ------- ------- -------
NET INCOME APPLICABLE TO MARATHON STOCK $107 $70 $182 $179
======= ======= ======= =======
MARATHON STOCK DATA:
Net income per share - primary and
fully diluted $.37 $.25 $.63 $.63
Dividends paid per share .17 .17 .34 .34
Weighted average shares, in thousands:
- Primary 287,246 286,578 287,217 286,580
- Fully diluted 293,504 286,578 287,225 286,581
<FN>
The statement of operations of the Marathon Group includes the results of
operations for the businesses of Marathon Oil Company and certain other
subsidiaries of USX and a portion of USX's net financial costs, general and
administrative costs and income taxes attributed to the three groups in
accordance with USX's accounting and tax allocation policies. This statement
should be read in connection with the consolidated statement of operations of
USX.
</TABLE>
<PAGE>
<TABLE>
MARATHON GROUP OF USX CORPORATION
SUPPLEMENTAL STATISTICS
($ in Millions)
<CAPTION>
Second Quarter Six Months
Ended Ended
June 30 June 30
1995 1994 1995 1994
------------- --------------
<S> <C> <C> <C> <C>
OPERATING INCOME (LOSS)
Exploration & Production
Domestic $83 $51 $168 $66
International 43 8 105 10
Refining, Marketing, & Transportation 147 29 142 126
Gas Gathering & Processing - (1) - -
Administrative (22) (24) (41) (41)
----- ----- ----- -----
$251 $63 $374 $161
Inventory Mkt. Val. Res. Adj. (2) 93 86 221
----- ----- ----- -----
Total Marathon Group $249 $156 $460 $382
CAPITAL EXPENDITURES $161 $164 $258 $277
OPERATING STATISTICS
Net Liquid Hydrocarbon Production (a):
Domestic 132.6 109.1 130.9 109.8
International 66.3 53.0 71.0 50.9
------- ------- ------- -------
Worldwide 198.9 162.1 201.9 160.7
Net Natural Gas Production (b):
Domestic 649.1 570.8 651.1 571.6
International - Equity 449.4 364.6 468.4 389.0
International - Other (c) 15.3 - 34.5 -
------- ------- ------- -------
Worldwide 1,113.8 935.4 1,154.0 960.6
Average Equity Sales Prices:
Liquid Hydrocarbons (per Bbl)
Domestic $15.36 $14.21 $14.94 $12.70
International 17.67 15.60 17.20 14.80
Natural Gas (per Mcf)
Domestic $1.61 $2.06 $1.65 $2.07
International 1.91 1.45 1.87 1.45
Natural Gas Sales (b) (d):
Domestic 989.0 841.7 992.9 826.1
International 464.7 364.6 502.9 389.0
------- ------- ------- -------
Worldwide 1,453.7 1,206.3 1,495.8 1,215.1
Crude Oil Refined (a) 532.5 531.5 505.8 486.4
Refined Products Sold (a) 720.2 759.2 724.9 722.8
- ------------
<FN>
(a) Thousands of barrels per day
(b) Millions of cubic feet per day
(c) Represents gas acquired for injection and subsequent resale
(d) Represents equity, royalty and trading volumes
</TABLE>
<PAGE>
<TABLE>
USX CORPORATION AND SUBSIDIARY COMPANIES
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS (Unaudited)
<CAPTION>
Second Quarter Six Months
Ended Ended
June 30 June 30
(Dollars in millions) 1995 1994 1995 1994
- --------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
SALES $5,278 $4,761 $10,316 $9,034
OPERATING COSTS:
Cost of sales (excludes items shown below) 3,736 3,551 7,394 6,745
Inventory market valuation charges
(credits) 2 (93) (86) (221)
Selling, general and administrative
expenses 53 64 95 119
Depreciation, depletion and amortization 300 272 590 530
Taxes other than income taxes 783 697 1,539 1,354
Exploration expenses 27 35 53 68
Restructuring charges (credits) (6) 37 (6) 37
------- ------- ------- -------
Total operating costs 4,895 4,563 9,579 8,632
------- ------- ------- -------
OPERATING INCOME 383 198 737 402
Other income 37 31 61 59
Interest and other financial income 13 2 17 11
Interest and other financial costs (132) (81) (265) (198)
------- ------- ------- -------
INCOME BEFORE INCOME TAXES 301 150 550 274
Less provision for estimated income taxes 111 43 206 92
------- ------- ------- -------
NET INCOME 190 107 344 182
Dividends on preferred stock (8) (9) (16) (16)
------- ------- ------- -------
NET INCOME APPLICABLE TO COMMON STOCKS $182 $98 $328 $166
======= ======= ======= =======
</TABLE>
The following common share data is an integral part of this financial statement.
<PAGE>
<TABLE>
USX CORPORATION AND SUBSIDIARY COMPANIES
COMMON SHARE DATA (Unaudited)
<CAPTION>
Second Quarter Six Months
Ended Ended
June 30 June 30
(Dollars in millions, except per share data) 1995 1994 1995 1994
- --------------------------------------------------------------------------------
- -------
<S> <C> <C> <C> <C>
APPLICABLE TO MARATHON STOCK:
Net income $107 $70 $182 $179
--Per share - primary and fully diluted .37 .25 .63 .63
Dividends paid per share .17 .17 .34 .34
Weighted average shares, in thousands:
- Primary 287,246 286,578 287,217 286,580
- Fully diluted 293,504 286,578 287,225 286,581
APPLICABLE TO STEEL STOCK:
Net income $74 $49 $142 $8
--Per share
- primary .99 .65 1.87 .11
- fully diluted .95 .64 1.80 .11
Dividends paid per share .25 .25 .50 .50
Weighted average shares, in thousands:
- Primary 76,562 75,490 76,373 74,579
- Fully diluted 87,484 78,929 87,293 74,579
APPLICABLE TO OUTSTANDING DELHI STOCK:
Net income (loss) $1 $(21) $4 $(21)
--Per share - primary and fully diluted .12 (2.27) .42 (2.25)
Dividends paid per share .05 .05 .10 .10
Weighted average shares, in thousands:
- Primary and fully diluted 9,438 9,418 9,438 9,375
</TABLE>
Contact: William E. Keslar
Don H. Herring
(412) 433-6870
FOR IMMEDIATE RELEASE
- ---------------------
USX CORPORATION REPORTS HIGHER SECOND QUARTER
RESULTS FOR ITS U. S. STEEL GROUP
PITTSBURGH, July 18, 1995 -- USX Corporation reported second quarter 1995
net income for its U. S. Steel Group (NYSE:X) of $81 million, or 99 cents per
share, on sales of $1.6 billion. The results represent a substantial
improvement over second quarter 1994 net income of $56 million, or 65 cents per
share, on sales of $1.5 billion.
The Steel Group's second quarter 1995 results included a $35 million
unfavorable estimated aftertax effect of charges related to the Pickering v. USX
litigation which arose out of the sale of USX's Geneva (Utah) Works in 1987 and
costs associated with repair work on the Gary Works' No. 8 blast furnace. The
furnace, which is expected to be back on line in mid-August, was extensively
damaged by an explosion on April 5. Second quarter 1994 results included no
significant special items.
Operating income in the second quarter of 1995 from Steel and Related
Businesses, excluding $56 million in pretax charges related to the Pickering v.
USX litigation and the blast furnace repair work, totaled $160 million, or $58
per ton, on steel shipments of 2.8 million tons, compared with $64 million, or
$24 per ton, on steel shipments of 2.6 million tons in the second quarter of
1994. Additional pretax charges of approximately $10 million to complete the
repairs to the blast furnace are expected to negatively impact third quarter
1995 operating income.
<PAGE> 2
USX Board Chairman Thomas J. Usher noted that despite the blast furnace
outage, the Steel Group produced more than 3 million tons of raw steel in the
second quarter, compared with 2.9 million tons in the second quarter of 1994.
He added that U. S. Steel's improved results over second quarter 1994 also
reflected higher transaction prices from a year ago and an improved market for
tubular goods.
The USX chairman noted, however, that, a combination of the seasonally
slow third quarter, the growing domestic supply base, inventory build-ups by
many customers, and a sustained high level of steel imports will continue to
apply competitive pressure on flat-rolled steel sales. Nevertheless,
comparatively high levels of domestic steel consumption, along with strong
export demand, are expected to keep U. S. Steel's facilities running at high
utilization rates for the balance of the year.
"Despite continued strong demand, we believe competitive success will
require ongoing attention to cost-reduction, quality and service," Usher said.
"The U. S. Steel Group is committed to continuing its impressive progress in
each of those areas as demonstrated by 33 METALPRODUCING magazine's 1995 TOP
(Top Operations & Plants) Award which was recently awarded to the Mon Valley
Works." This award recognizes facilities which have distinguished themselves as
low-cost international competitors with world-class processes, product quality
and customer service.
<PAGE> 3
* * * * * * *
Statement of operations and supplemental statistics for the U. S. Steel
Group and consolidated statement of operations for USX Corporation are attached.
Consolidated net income for USX Corporation was $190 million in the second
quarter of 1995, compared with $107 million in the second quarter of 1994.
<PAGE>
<TABLE>
U. S. STEEL GROUP OF USX CORPORATION
STATEMENT OF OPERATIONS (Unaudited)
<CAPTION>
Second Quarter Six Months
Ended Ended
June 30 June 30
(Dollars in millions, except per share data) 1995 1994 1995 1994
- --------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
SALES $1,623 $1,534 $3,200 $2,918
OPERATING COSTS:
Cost of sales (excludes items shown below) 1,393 1,343 2,741 2,646
Selling, general and administrative
expenses (credits) (32) (31) (69) (61)
Depreciation, depletion and amortization 84 80 161 158
Taxes other than income taxes 49 54 104 111
------- ------- ------- -------
Total operating costs 1,494 1,446 2,937 2,854
------- ------- ------- -------
OPERATING INCOME 129 88 263 64
Other income 26 27 45 32
Interest and other financial income 3 3 5 6
Interest and other financial costs (36) (37) (75) (75)
------- ------- ------- -------
INCOME BEFORE INCOME TAXES 122 81 238 27
Less provision for estimated income taxes 41 25 83 6
------- ------- ------- -------
NET INCOME 81 56 155 21
Dividends on preferred stock (7) (7) (13) (13)
------- ------- ------- -------
NET INCOME APPLICABLE TO STEEL STOCK $74 $49 $142 $8
======= ======= ======= =======
STEEL STOCK DATA:
Net income per share
- primary $.99 $.65 $1.87 $.11
- fully diluted .95 .64 1.80 .11
Dividends paid per share .25 .25 .50 .50
Weighted average shares, in thousands:
- Primary 76,562 75,490 76,373 74,579
- Fully diluted 87,484 78,929 87,293 74,579
<FN>
The statement of operations of the U. S. Steel Group includes the results of
operations for all businesses of USX other than businesses included in the
Marathon Group or the Delhi Group and a portion of USX's net financial costs,
general and administrative costs and income taxes attributed to the three groups
in accordance with USX's accounting and tax allocation policies. This statement
should be read in connection with the consolidated statement of operations of
USX.
</TABLE>
<PAGE>
<TABLE>
U. S. STEEL GROUP OF USX CORPORATION
SUPPLEMENTAL STATISTICS
($ in Millions)
<CAPTION>
Second Quarter Six Months
Ended Ended
June 30 June 30
-------------- -------------
1995 1994 1995 1994
---- ---- ---- ----
SALES
<S> <C> <C> <C> <C>
Steel and Related Businesses (a) $1,612 $1,482 $3,161 $2,816
Other 11 52 39 102
------- ------- ------- -------
Total U. S. Steel Group $1,623 $1,534 $3,200 $2,918
OPERATING INCOME
Steel and Related Businesses (a) $104 $64 $204 $28
Administrative and Other (b) 25 24 59 36
------- ------- ------- -------
Total U. S. Steel Group $129 $88 $263 $64
CAPITAL EXPENDITURES $86 $64 $142 $108
OPERATING STATISTICS
Public & Affil. Steel Shipments (c) 2,757 2,636 5,479 5,097
Raw Steel-Production (c) 3,018 2,918 5,963 5,661
Raw Steel-Capability Utilization (d) 96.8% 97.6% 96.2% 95.2%
- ------------
<FN>
(a) Includes the production and sale of steel products, coke and taconite
pellets; domestic coal mining; the management of mineral resources; and
engineering and consulting services and technology licensing.
(b) Includes pension credits, other postretirement benefit costs and certain
other expenses principally attributable to former business units of the
U. S. Steel Group. Also includes results of real estate development and
management, and leasing and financing activities.
(c) Thousands of net tons
(d) Based on annual raw steel production capability of 12.5 million tons for
1995 and 12.0 million tons for 1994.
</TABLE>
<PAGE>
<TABLE>
USX CORPORATION AND SUBSIDIARY COMPANIES
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS (Unaudited)
<CAPTION>
Second Quarter Six Months
Ended Ended
June 30 June 30
(Dollars in millions) 1995 1994 1995 1994
- --------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
SALES $5,278 $4,761 $10,316 $9,034
OPERATING COSTS:
Cost of sales (excludes items shown below) 3,736 3,551 7,394 6,745
Inventory market valuation charges
(credits) 2 (93) (86) (221)
Selling, general and administrative
expenses 53 64 95 119
Depreciation, depletion and amortization 300 272 590 530
Taxes other than income taxes 783 697 1,539 1,354
Exploration expenses 27 35 53 68
Restructuring charges (credits) (6) 37 (6) 37
------- ------- ------- -------
Total operating costs 4,895 4,563 9,579 8,632
------- ------- ------- -------
OPERATING INCOME 383 198 737 402
Other income 37 31 61 59
Interest and other financial income 13 2 17 11
Interest and other financial costs (132) (81) (265) (198)
------- ------- ------- -------
INCOME BEFORE INCOME TAXES 301 150 550 274
Less provision for estimated income taxes 111 43 206 92
------- ------- ------- -------
NET INCOME 190 107 344 182
Dividends on preferred stock (8) (9) (16) (16)
------- ------- ------- -------
NET INCOME APPLICABLE TO COMMON STOCKS $182 $98 $328 $166
======= ======= ======= =======
</TABLE>
The following common share data is an integral part of this financial statement.
<PAGE>
<TABLE>
USX CORPORATION AND SUBSIDIARY COMPANIES
COMMON SHARE DATA (Unaudited)
<CAPTION>
Second Quarter Six Months
Ended Ended
June 30 June 30
(Dollars in millions, except per share data) 1995 1994 1995 1994
- --------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Applicable to Marathon Stock:
Net income $107 $70 $182 $179
--Per share - primary and fully diluted .37 .25 .63 .63
Dividends paid per share .17 .17 .34 .34
Weighted average shares, in thousands:
- Primary 287,246 286,578 287,217 286,580
- Fully diluted 293,504 286,578 287,225 286,581
APPLICABLE TO STEEL STOCK:
Net income $74 $49 $142 $8
--Per share
- primary .99 .65 1.87 .11
- fully diluted .95 .64 1.80 .11
Dividends paid per share .25 .25 .50 .50
Weighted average shares, in thousands:
- Primary 76,562 75,490 76,373 74,579
- Fully diluted 87,484 78,929 87,293 74,579
APPLICABLE TO OUTSTANDING DELHI STOCK:
Net income (loss) $1 $(21) $4 $(21)
--Per share - primary and fully diluted .12 (2.27) .42 (2.25)
Dividends paid per share .05 .05 .10 .10
Weighted average shares, in thousands:
- Primary and fully diluted 9,438 9,418 9,438 9,375
</TABLE>
Contact: William E. Keslar
Don H. Herring
(412) 433-6870
FOR IMMEDIATE RELEASE
- ---------------------
USX CORPORATION REPORTS SECOND QUARTER
DELHI GROUP FINANCIAL RESULTS
PITTSBURGH, July 18, 1995 -- USX Corporation reported second quarter 1995
net income for its Delhi Group (NYSE:DGP) of $2.3 million, or 12 cents per
share, which included a favorable estimated aftertax effect of $5.1 million
related to the completion of an asset disposal plan initiated in the second
quarter of 1994. Second quarter 1994 net loss of $31.6 million, or $2.27 per
share, included estimated aftertax charges totaling $28.0 million, mainly for
the above mentioned asset disposal plan, an employee severance program and other
employment-related costs.
During the second quarter of 1995, Delhi recorded favorable pretax
adjustments totaling $11.2 million ($6.2 million in operating income and
$5.0 million in other income). These adjustments were related to the completion
of the 1994 non-strategic asset disposition plan which resulted in higher than
anticipated sales proceeds. During the second quarter of 1994, Delhi recorded
pretax charges of $39.9 million related to the aforementioned disposition plan.
Excluding the $6.2 million favorable asset disposition adjustment, the
second quarter operating loss for the Delhi Group totaled $1.3 million, a $7.3
million improvement compared to the second quarter of 1994 excluding a $37.4
million planned asset disposal charge.
<PAGE> 2
Second quarter 1995 gas processing margin from the extraction and sale of
natural gas liquids (NGLs) improved substantially from last year's second
quarter primarily due to lower feedstock costs, higher sales volumes and higher
NGLs prices. In addition, total operating costs, excluding gas purchase costs,
were lower, mainly resulting from the benefits of the asset disposition plan and
work force reduction program initiated in mid-1994. Gas sales margins declined
from last year due primarily to lower sales volumes and lower gas prices. The
second quarter 1994 operating loss also included $4.8 million of charges, mainly
for the employee severance program and other employment-related costs.
Delhi completed projects in the 1995 second quarter which added 21 miles of
gathering lines and 3,000 horsepower of compression in West Texas. These
projects added an additional 34.5 million cubic feet per day (mmcfd) of system
supply volumes and increased deliverability by 20 mmcfd to treating facilities
acquired in 1994.
USX Board Chairman Thomas J. Usher stated, "Delhi remains committed to
expanding its system supply. During the second quarter of 1995, Delhi acquired
a treating facility and associated gathering system in South Texas. In
conjunction with the acquisition, Delhi also negotiated gathering and treating
service agreements for a term of 10 years." Usher added, "Also during the
quarter, Delhi reached a tentative agreement for a major expansion into the
Pinnacle Reef area of East Texas. The expansion will include approximately 20
miles of 12-inch pipeline and certain treating plant upgrades."
<PAGE> 3
Delhi is an established natural gas merchant engaged in the purchasing,
gathering, processing, transporting and marketing of natural gas. It operates an
extensive pipeline system and associated gas processing plants in Texas and
Oklahoma.
* * * * * * *
Statement of operations and supplemental statistics for the Delhi Group and
consolidated statement of operations for USX Corporation are attached.
Consolidated net income for USX Corporation was $190 million in the second
quarter of 1995, compared with $107 million in the second quarter of 1994.
<PAGE>
<TABLE>
DELHI GROUP OF USX CORPORATION
STATEMENT OF OPERATIONS (Unaudited)
<CAPTION>
Second Quarter Six Months
Ended Ended
June 30 June 30
(Dollars in millions, except per share data) 1995 1994 1995 1994
- --------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
SALES $139.4 $136.2 $276.3 $290.6
OPERATING COSTS:
Cost of sales (excludes items shown below) 126.7 124.0 239.8 257.4
Selling, general and administrative
expenses 5.8 9.3 12.2 16.4
Depreciation, depletion and amortization 6.3 9.3 12.6 18.6
Taxes other than income taxes 1.9 2.2 3.9 4.3
Restructuring charges (credits) (6.2) 37.4 (6.2) 37.4
------- ------- ------- -------
Total operating costs 134.5 182.2 262.3 334.1
------- ------- ------- -------
OPERATING INCOME (LOSS) 4.9 (46.0) 14.0 (43.5)
Other income (loss) 5.1 (2.2) 5.7 (1.3)
Interest and other financial costs (3.3) (2.9) (6.6) (5.6)
------- ------- ------- -------
INCOME (LOSS) BEFORE INCOME TAXES 6.7 (51.1) 13.1 (50.4)
Less provision (credit) for estimated
income taxes 4.4 (19.5) 6.6 (19.2)
------- ------- ------- -------
NET INCOME (LOSS) 2.3 (31.6) 6.5 (31.2)
Dividends on preferred stock (.1) (.1) (.1) (.1)
Net (income) loss applicable to
Retained Interest (1.0) 10.3 (2.4) 10.2
------- ------- ------- -------
NET INCOME (LOSS) APPLICABLE TO OUTSTANDING
DELHI STOCK $1.2 $(21.4) $4.0 $(21.1)
======= ======= ======= =======
DELHI STOCK DATA:
Net income (loss) per share - primary and
fully diluted $.12 $(2.27) $.42 $(2.25)
======= ======= ======= =======
Dividends paid per share .05 .05 .10 .10
Weighted average shares, in thousands:
- Primary and fully diluted 9,438 9,418 9,438 9,375
<FN>
The statement of operations of the Delhi Group includes the results of
operations for the businesses of Delhi Gas Pipeline Corporation and certain
other subsidiaries of USX and a portion of USX's net financial costs, general
and administrative costs and income taxes attributed to the three groups in
accordance with USX's accounting and tax allocation policies. This statement
should be read in connection with the consolidated statement of operations of
USX.
The Retained Interest of approximately 33% through June 14, 1995 is reflected in
the Marathon Group financial statements. On June 15, 1995, USX eliminated the
Retained Interest. The shares deemed to represent the Retained Interest were
not outstanding shares of Delhi Stock.
</TABLE>
<PAGE>
<TABLE>
DELHI GROUP OF USX CORPORATION
SUPPLEMENTAL STATISTICS
($ in Millions)
<CAPTION>
Second Quarter Six Months
Ended Ended
June 30 June 30
-------------- ------------
1995 1994 1995 1994
---- ---- ---- ----
GROSS MARGIN
<S> <C> <C> <C> <C>
Gas Sales and Trading Margin $9.3 $14.2 $29.9 $39.0
Transportation Margin 2.9 3.1 5.3 5.7
------- ------- ------- -------
Systems and Trading Margin 12.2 17.3 35.2 44.7
Gas Processing Margin 6.4 3.3 13.1 3.3
------- ------- ------- -------
Total Gross Margin $18.6 $20.6 $48.3 $48.0
OPERATING INCOME (LOSS) $4.9 $(46.0) $14.0 $(43.5)
CAPITAL EXPENDITURES $7.1 $9.0 $12.7 $13.9
OPERATING STATISTICS
Natural Gas Volumes (a)
Natural Gas Sales 531.8 625.4 581.2 638.8
Transportation 317.8 293.1 274.7 269.0
------- ------- ------- -------
Systems Throughput 849.6 918.5 855.9 907.8
Trading Sales 324.1 82.4 266.2 55.9
Partnership - equity share (b) 7.0 23.6 10.5 21.9
------- ------- ------- -------
Total Sales Volumes 1,180.7 1,024.5 1,132.6 985.6
Natural Gas Liquids Sales (c) 823.6 805.6 817.1 717.0
- ------------
<FN>
(a) Millions of cubic feet per day
(b) Related to an investment in Ozark Gas Transmission System which was sold
in the second quarter of 1995.
(c) Thousand of gallons per day
</TABLE>
<PAGE>
<TABLE>
USX CORPORATION AND SUBSIDIARY COMPANIES
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS (Unaudited)
<CAPTION>
Second Quarter Six Months
Ended Ended
June 30 June 30
(Dollars in millions) 1995 1994 1995 1994
- --------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
SALES $5,278 $4,761 $10,316 $9,034
OPERATING COSTS:
Cost of sales (excludes items shown below) 3,736 3,551 7,394 6,745
Inventory market valuation charges
(credits) 2 (93) (86) (221)
Selling, general and administrative
expenses 53 64 95 119
Depreciation, depletion and amortization 300 272 590 530
Taxes other than income taxes 783 697 1,539 1,354
Exploration expenses 27 35 53 68
Restructuring charges (credits) (6) 37 (6) 37
------- ------- ------- -------
Total operating costs 4,895 4,563 9,579 8,632
------- ------- ------- -------
OPERATING INCOME 383 198 737 402
Other income 37 31 61 59
Interest and other financial income 13 2 17 11
Interest and other financial costs (132) (81) (265) (198)
------- ------- ------- -------
INCOME BEFORE INCOME TAXES 301 150 550 274
Less provision for estimated income taxes 111 43 206 92
------- ------- ------- -------
NET INCOME 190 107 344 182
Dividends on preferred stock (8) (9) (16) (16)
------- ------- ------- -------
NET INCOME APPLICABLE TO COMMON STOCKS $182 $98 $328 $166
======= ======= ======= =======
</TABLE>
The following common share data is an integral part of this financial statement.
<PAGE>
<TABLE>
USX CORPORATION AND SUBSIDIARY COMPANIES
COMMON SHARE DATA (Unaudited)
<CAPTION>
Second Quarter Six Months
Ended Ended
June 30 June 30
(Dollars in millions, except per share data) 1995 1994 1995 1994
- --------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Applicable to Marathon Stock:
Net income $107 $70 $182 $179
--Per share - primary and fully diluted .37 .25 .63 .63
Dividends paid per share .17 .17 .34 .34
Weighted average shares, in thousands:
- Primary 287,246 286,578 287,217 286,580
- Fully diluted 293,504 286,578 287,225 286,581
APPLICABLE TO STEEL STOCK:
Net income $74 $49 $142 $8
--Per share
- primary .99 .65 1.87 .11
- fully diluted .95 .64 1.80 .11
Dividends paid per share .25 .25 .50 .50
Weighted average shares, in thousands:
- Primary 76,562 75,490 76,373 74,579
- Fully diluted 87,484 78,929 87,293 74,579
APPLICABLE TO OUTSTANDING DELHI STOCK:
Net income (loss) $1 $(21) $4 $(21)
--Per share - primary and fully diluted .12 (2.27) .42 (2.25)
Dividends paid per share .05 .05 .10 .10
Weighted average shares, in thousands:
- Primary and fully diluted 9,438 9,418 9,438 9,375
</TABLE>
