C E N T R A L S E C U R I T I E S C O R P O R A T I O N
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INTERIM REPORT TO STOCKHOLDERS
AS OF SEPTEMBER 30, 1998
<PAGE>
TO THE STOCKHOLDERS OF
CENTRAL SECURITIES CORPORATION:
Financial data for the quarter ended September 30, 1998 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, 1998 June 30, 1998 Dec. 31, 1997
---------------- ---------------- ----------------
<S> <C> <C> <C>
Net assets .................................... $399,768,321 $462,071,326 $434,423,053
Convertible Preference Stock at liquidation
preference .................................. (8,988,450) (8,988,575) (9,040,850)
------------ ------------ ------------
Net assets applicable to Common Stock ......... $390,779,871 $453,082,751 $425,382,203
============ ============ ============
Net asset coverage per share of Convertible
Preference Stock ............................ $ 1,111.89 $ 1,285.16 $ 1,201.28
Net assets per share of Common Stock .......... 27.58 31.91 29.97
Pro forma net assets per share, reflecting
conversion of the Convertible Preference
Stock ....................................... 25.95 29.94 28.14
Shares of Convertible Preference Stock
outstanding .............................. 359,538 359,543 361,634
Shares of Common Stock outstanding ......... 14,166,949 14,198,932 14,191,745
</TABLE>
Comparative figures of income are as follows:
<TABLE>
<CAPTION>
Nine months ended September 30,
---------------------------------
1998 1997
--------------- ---------------
<S> <C> <C>
Net investment income ............................................... $ 4,019,830 $ 3,543,806
Number of times Preferred dividend earned ........................ 7.4 6.5
Per share of Common Stock ........................................ .25* .22*
Net realized gain on sale of investments ............................ 20,569,234 27,057,418
Increase (decrease) in net unrealized appreciation of
investments ....................................................... (55,097,640) 74,709,835
Increase (decrease) in net assets resulting from operations ......... (30,508,576) 105,311,059
</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, 1998
(Common Stock unless specified otherwise)
<TABLE>
<CAPTION>
Number of Shares
-----------------------------------------
Held
September 30,
Purchased Sold 1998
----------- ---------- --------------
<S> <C> <C> <C>
The Bank of New York Company, Inc. .............. 550,000* 1,100,000
Cabletron Systems, Inc. ......................... 180,000 180,000
Capital One Financial Corporation ............... 8,000 202,000
Cyprus Amax Minerals Company .................... 300,000 --
Deltic Timber Corporation ....................... 20,000 50,000
Electronic Data Systems Corporation ............. 200,000 100,000
First Data Corporation .......................... 100,000 --
Intel Corporation ............................... 55,000 450,000
Martin Color-Fi, Inc. ........................... 10,000 220,000
Mercantile International Petroleum Inc. ......... 300,000 --
Peerless Systems Corporation .................... 107,500 272,500
Rohm and Haas Company ........................... 200,000* 300,000
</TABLE>
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* Stock split.
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In the quarter ended September 30, 1998 the Corporation repurchased 32,000
shares of its Common Stock on the American Stock Exchange at an average price
per share of $23.91. The Corporation 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 21, 1998
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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
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.
4 New York Plaza, New York, NY 10004
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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