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):
March 31, 1997
VALERO ENERGY CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 1-4718 74-1244795
(State of incorporation) Commission File (I.R.S. Employer
jurisdiction Number Identification No.)
of incorporation
530 McCullough Avenue, San Antonio, Texas 78215
(Address of principal executive offices) (Zip Code)
(210) 246-2000
(Registrant's telephone number, including area code)
Not applicable
(Former name or address, if changed since last report)
<PAGE>
Item 5. Other Events
First Quarter 1997 Earnings
For the three months ended March 31, 1997, Valero Energy Corporation (the
"Company") reported net income of $15.4 million, or $0.29 per share of common
stock, compared to first quarter 1996 net income of $19.9 million, or $0.39
per common share.
The Company's refining and marketing operations reported record first
quarter 1997 operating income of $43.5 million, compared to $15.2 million for
the same period last year. The increase was due primarily to an improvement
in the discount for the Company's residual fuel oil purchases and higher
gasoline-to-crude premiums.
Operating income from the natural gas related services segment was $10.9
million for the first quarter of 1997, compared to $47.5 million for the first
quarter of 1996. The decrease was due to lower natural gas sales prices and
margins, resulting primarily from unusually warm winter weather in the Eastern
United States in February and March, and a lower contribution from the
segment's price risk management activities. The decrease was partially offset
by improved natural gas liquids ("NGL") margins resulting from higher NGL
product prices, which were supported by strong crude oil and refined product
markets and continued tight NGL inventories.
The following table presents selected earnings and operations information
for the Company for the three months ended March 31, 1997 and 1996.
VALERO ENERGY CORPORATION AND SUBSIDIARIES
EARNINGS
(Millions of Dollars, Unless Otherwise Noted)
(Unaudited)
Three Months Ended March 31,
1997 1996 % Change
________ ________ ________
OPERATING REVENUES:
Refining and Marketing $821.8 $574.5 43
Natural Gas Related Services 767.4 577.9 33
Intersegment Eliminations (52.1) (42.3) (23)
________ ________ ___
Total $1,537.1 $1,110.1 38
======== ========
OPERATING INCOME (LOSS)
Refining and Marketing $43.5 $15.2 186
Natural Gas Related Services 10.9 47.5 (77)
Corporate General and Administrative
Expenses and Other, Net (10.5) (10.5) -
________ ________
Total 43.9 52.2 (16)
________ ________
EQUITY IN EARNINGS OF JOINT VENTURES 1.0 0.2 400
OTHER INCOME, NET. 1.4 2.5 (44)
INTEREST AND DEBT EXPENSE, NET (22.9) (25.2) 9
________ ________
INCOME BEFORE INCOME TAXES 23.4 29.7 (21)
INCOME TAX EXPENSE 8.0 9.8 (18)
________ ________
NET INCOME 15.4 19.9 (23)
LESS: PREFERRED STOCK DIVIDENDS. 2.7 2.8 (4)
________ ________
NET INCOME APPLICABLE TO COMMON STOCK $12.7 $17.1 (26)
======== =========
EARNINGS PER COMMON SHARE $0.29 $0.39 (26)
======== =========
VALERO ENERGY CORPORATION AND SUBSIDIARIES
OPERATING STATISTICS
(Millions of Dollars, Unless Otherwise Noted)
(Unaudited)
Three Months Ended March 31,
1997 1996 % Change
________ ________ _______
OPERATING STATISTICS:
Refining and Marketing
Throughput Volumes (Mbbls per Day) 174 169 3
Average Throughput Margin per Barrel $6.58 $ 4.55 45
Natural Gas Related Services:
Gas Volumes (MMcf per Day):
Sales 1,924 1,776 8
Transportation 1,559 1,426 9
________ ________ ___
Total Gas Volumes 3,483 3,202 9
======== ========
Average Gas Sales Margin per Mcf $(.015) $.246 (106)
Average Gas Transportation Fee
per Mcf $.082 $.101 (19)
NGL Plant Production:
Production Volumes
(Mbbls per Day) 82.2 78.9 4
Average NGL Market
Price per Gallon. $.361 $.305 18
Average Gas Cost per Mcf. . $2.32 $1.60 45
Average NGL Margin per Gallon. $.119 $.095 25
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this Current Report on Form 8-K to be signed on its
behalf by the undersigned thereunto duly authorized.
VALERO ENERGY CORPORATION
By: /s/ Edward C. Benninger, Jr.
Edward C. Benninger, Jr.
President and Chief Financial Officer
Dated: April 24, 1997
