CENTRAL SECURITIES CORPORATION
---------------
INTERIM REPORT TO STOCKHOLDERS
AS OF SEPTEMBER 30, 1997
<PAGE>
TO THE STOCKHOLDERS OF
CENTRAL SECURITIES CORPORATION:
Financial data for the quarter ended September 30, 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>
Sept. 30, 1997 June 30, 1997 Dec. 31, 1996
-------------- ------------- -------------
<S> <C> <C> <C>
Net assets.......................................... $ 458,740,471 $ 407,685,839 $ 356,685,785
Convertible Preference Stock at liquidation
preference........................................ (9,041,000) (9,042,675) (9,102,050)
-------------- ------------- -------------
Net assets applicable to Common Stock............... $ 449,699,471 $ 398,643,164 $ 347,583,735
-------------- ------------- -------------
-------------- ------------- -------------
Net asset coverage per share of Convertible
Preference Stock.................................. $ 1,268.50 $ 1,127.12 $ 979.69
Net assets per share of Common Stock................ 33.16 29.39 25.64
Pro forma net assets per share, reflecting
conversion of the Convertible Preference
Stock............................................. 31.13 27.67 24.21
Shares of Convertible Preference Stock
outstanding.................................. 361,640 361,707 364,082
Shares of Common Stock outstanding............. 13,562,925 13,562,710 13,555,021
</TABLE>
Comparative figures of income are as follows:
<TABLE>
<CAPTION>
Nine months ended September 30,
-------------------------------
1997 1996
------------ -----------
<S> <C> <C>
Net investment income........................................... $ 3,543,806 $ 3,574,380
Number of times Preferred dividend earned.................. 6.5 6.3
Per share of Common Stock.................................. .22* .23*
Net realized gain on sale of investments........................ 27,057,418 13,525,604
Increase in net unrealized appreciation of investments.......... 74,709,835 31,209,728
Increase in net assets resulting from operations................ 105,311,059 48,309,712
</TABLE>
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* Per-share data are based on the average number of Common shares outstanding
during the nine-month period and are after recognition of the dividend
requirement on the Convertible Preference Stock.
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<PAGE>
PRINCIPAL PORTFOLIO CHANGES
July 1 to September 30, 1997
(Common Stock unless specified otherwise)
<TABLE>
<CAPTION>
Number of Shares
-------------------------------------------
Held
September 30,
Purchased Sold 1997
--------- ------- -------------
<S> <C> <C> <C>
American Management Systems, Inc......................... 437,500 900,000
The DII Group Incorporated............................... 250,000* 500,000
Electronic Data Systems Corporation...................... 100,000 300,000
Household International, Inc............................. 30,000 160,000
IXC Communications Corporation 7 1/4%
Junior Conv. Pfd. Due 2007............................. 184** 10,365
Integon Corporation...................................... 100,000 --
Intel Corporation........................................ 270,000* 540,000
Nextel Communications, Inc. Class A...................... 20,000 420,000
Petroleum Geo-Services ASA ADR........................... 95,000 15,000
Provident Companies, Inc................................. 150,000* 300,000
Watkins-Johnson Company.................................. 10,000 275,900+
</TABLE>
- ------------
* Stock split.
** Received as a dividend.
+ Includes shares listed under "Miscellaneous" in the Statement of Investments
at June 30, 1997.
---------------
In the quarter ended September 30, 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
October 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
www.centralsecurities.com
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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