<PAGE>
CENTRAL SECURITIES CORPORATION
INTERIM REPORT TO STOCKHOLDERS
AS OF MARCH 31, 1997
<PAGE>
TO THE STOCKHOLDERS OF
CENTRAL SECURITIES CORPORATION:
Financial data for the quarter ended March 31, 1997 and other pertinent
information prepared by management without audit by independent auditors are
submitted herewith.
Comparative market values of net assets are as follows:
<TABLE>
<CAPTION>
Mar. 31, 1997 Dec. 31, 1996 Mar. 31, 1996
<S> <C> <C> <C>
Net assets.......................................... $ 365,798,585 $ 356,685,785 $ 311,059,260
Convertible Preference Stock at liquidation
preference........................................ (9,046,450) (9,102,050) (9,455,700)
Net assets applicable to Common Stock............... $ 356,752,135 $ 347,583,735 $ 301,603,560
Net asset coverage per share of Convertible
Preference Stock.................................. $ 1,010.89 $ 979.69 $ 822.41
Net assets per share of Common Stock................ 26.30 25.64 23.16
Pro forma net assets per share, reflecting
conversion of the Convertible Preference
Stock............................................. 24.83 24.21 21.90
Shares of Convertible Preference Stock
outstanding.................................. 361,858 364,082 378,228
Shares of Common Stock outstanding............. 13,562,224 13,555,021 13,022,459
</TABLE>
Comparative figures of income are as follows:
<TABLE>
<CAPTION>
Three months ended March 31,
1997 1996
<S> <C> <C>
Net investment income............................................... $1,102,514 $1,303,192
Number of times Preferred dividend earned...................... 6.1 6.9
Per share of Common Stock...................................... .07* .09*
Net realized gain on sale of investments............................ 12,211,844 3,209,834
Increase (decrease) in net unrealized appreciation of investments... (4,019,665) 14,188,522
Increase in net assets resulting from operations.................... 9,294,693 18,701,548
</TABLE>
* Per-share data are based on the average number of Common shares outstanding
during the three-month period and are after recognition of the dividend
requirement on the Convertible Preference Stock.
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<PAGE>
PRINCIPAL PORTFOLIO CHANGES
January 1 to March 31, 1997
(Common Stock unless specified otherwise)
<TABLE>
<CAPTION>
Number of Shares
Held
March 31,
Purchased Sold 1997
<S> <C> <C> <C>
American Management Systems, Inc............................. 92,500 462,500
Analog Devices, Inc.......................................... 185,000(a) 740,000
Deltic Timber Corporation.................................... 85,714(b) 85,714
IXC Communications Corporation............................... 56,905(c) 56,905
Integon Corporation.......................................... 100,000 100,000
Kelly Services Inc. Class A.................................. 20,000 30,000
Measurex Corporation......................................... 280,000(d) --
Media General, Inc. Class A.................................. 40,000 60,000
The Reynolds and Reynolds Company
Class A.................................................... 125,000 500,000
Tidewater Inc................................................ 50,000 --
Trigon Healthcare, Inc....................................... 7,200 7,200
</TABLE>
(a) Stock split.
(b) Received from Murphy Oil Corporation.
(c) Received from Grumman Hill Investments, L.P.
(d) Tendered to Honeywell, Inc.
The annual meeting of stockholders of the Corporation was held on March 12,
1997 with 91% and 98% of Common and Preference shares, respectively, being
represented. At the meeting the Board of Directors was reelected and the
selection of KPMG Peat Marwick LLP as auditors of the Corporation for the year
1997 was ratified.
During the first three months of 1997 the Corporation did not repurchase
any of its Common or Preference Stock. However, it may from time to time
purchase Common or Preference Stock in such amounts and at such prices as the
Board of Directors may deem advisable in the best interests of stockholders.
Stockholders' inquiries are welcome.
CENTRAL SECURITIES CORPORATION
WILMOT H. KIDD, PRESIDENT
375 Park Avenue
New York, NY 10152
April 24, 1997
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<PAGE>
BOARD OF DIRECTORS
DONALD G. CALDER DUDLEY D. JOHNSON
President President
G. L. Ohrstrom & Co., Inc. Young & Franklin Inc.
New York, NY Liverpool, NY
JAY R. INGLIS WILMOT H. KIDD
Executive Vice President President
Holt Corporation
New York, NY
C. CARTER WALKER, JR.
Washington, CT
GARDINER S. ROBINSON
Director Emeritus
OFFICERS
WILMOT H. KIDD, President
CHARLES N. EDGERTON, Vice President and
Treasurer
KAREN E. RILEY, Secretary
OFFICE
375 Park Avenue, New York, NY 10152
212-688-3011
CUSTODIAN
The Chase Manhattan Bank, N.A.
770 Broadway, New York, NY 10003
TRANSFER AGENT AND REGISTRAR
First Chicago Trust Company of New York
P. O. Box 2500, Jersey City, NJ 07303-2500
INDEPENDENT AUDITORS
KPMG Peat Marwick LLP
345 Park Avenue, New York, NY 10154
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