<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 10-Q
(X) QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 1996
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OR
( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
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Commission File Number 1-4014
FINA, Inc.
(Exact name of registrant as specified in its charter)
Delaware 13-1820692
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
Fina Plaza, Dallas, Texas 75206
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (214)750-2400
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Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements over the past 90 days.
Yes X No
----- -----
APPLICABLE ONLY TO CORPORATE ISSUERS:
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
29,212,872 Class A as of April 8, 1996
2,000,000 Class B as of April 8, 1996
<PAGE> 2
FINA, Inc. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS, EXCEPT SHARE AND PER SHARE AMOUNTS)
(UNAUDITED)
<TABLE>
<CAPTION>
MARCH 31, DECEMBER 31,
1996 1995
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<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents $4,470 $7,271
Accounts and notes receivable 418,918 336,246
Inventories 305,358 301,496
Prepaid expenses and other current assets 48,142 43,418
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Total current assets 776,888 688,431
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Property, plant, and equipment; net of $1,415,314 accumulated
depreciation at 3/31/96 1,655,961 1,662,887
Other assets 150,072 136,400
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$2,582,921 $2,487,718
=========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Short term obligations $24,000 $20,000
Current installments of long term debt and lease obligations 35,720 35,474
Accounts payable and accrued liabilities 560,740 488,455
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Total current liabilities 620,460 543,929
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Long term debt, excluding current installments 494,899 498,446
Other deferred credits and liabilities 270,039 267,286
Stockholders' equity: (note 2)
Preferred stock of $1 par value. Authorized 4,000,000 shares;
none issued - -
Class A common stock of $.50 par value. Authorized
38,000,000 shares; issued and outstanding 29,212,472 and
29,207,572 shares in 1996 and 1995 14,606 14,604
Class B common stock of $.50 par value. Authorized
and issued 2,000,000 shares 1,000 1,000
Additional paid-in capital 450,770 450,601
Retained earnings 731,147 711,852
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Total stockholders' equity 1,197,523 1,178,057
Commitments and contingencies (note 3) - -
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$2,582,921 $2,487,718
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</TABLE>
See accompanying notes to consolidated financial statements.
<PAGE> 3
FINA, Inc. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF EARNINGS
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
(UNAUDITED)
<TABLE>
<CAPTION>
THREE MONTHS ENDED MARCH 31,
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1996 1995
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<S> <C> <C>
Revenues:
Sales and other operating revenues $965,115 $863,188
Interest and other, net (2,715) (1,850)
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962,400 861,338
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Costs and expenses:
Cost of raw materials and products purchased 724,868 636,774
Direct operating expenses 93,791 88,490
Selling, general, and administrative expenses 20,673 20,806
Taxes, other than on income 11,974 11,911
Dry holes and abandonments 4,115 1,516
Depreciation, depletion, amortization,
and lease impairment 39,683 38,445
Interest charges, net 9,738 11,958
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904,842 809,900
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Earnings before income taxes 57,558 51,438
Income taxes 19,536 17,948
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Net earnings $38,022 $33,490
========= =========
Earnings per common share (note 2) $1.22 $1.07
========= =========
</TABLE>
See accompanying notes to consolidated financial statements.
<PAGE> 4
FINA, Inc. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
THREE MONTHS ENDED MARCH 31, 1996 AND 1995
(IN THOUSANDS)
(UNAUDITED)
<TABLE>
<CAPTION>
1996 1995
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<S> <C> <C>
Cash flows provided by operating activities $47,007 $31,032
Cash flows from investing activities:
Additions to property, plant and equipment (38,588) (22,398)
Proceeds from disposal of assets 7,207 5,609
Investments in and advances to affiliates (570) (1,406)
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Net cash used in investing activities (31,951) (18,195)
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Cash flows from financing activities:
Payments of long term debt and lease obligations (3,301) (3,107)
Net change in short term obligations 4,000 5,000
Issuance of common stock 171 14
Dividends paid (18,727) (15,595)
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Net cash used in financing activities (17,857) (13,688)
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Net decrease in cash and cash equivalents (2,801) (851)
Cash and cash equivalents at beginning of period 7,271 3,533
-------- --------
Cash and cash equivalents at end of period $4,470 $2,682
======== ========
</TABLE>
See accompanying notes to consolidated financial statements.
<PAGE> 5
FINA, Inc. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MARCH 31, 1996
(UNAUDITED)
(1) The information furnished reflects all adjustments which are, in the
opinion of management, necessary to a fair presentation of the results of
the interim periods presented.
(2) Earnings per common share is based on the weighted average number of
oustanding shares. Shares issuable upon the exercise of stock options are
excluded from the computation since their effect is insignificant. The
Company declared a two-for-one stock split with record date of May 2,
1995, at close of business. The par value is 50 cents per share of both
Class A and Class B stock. Share and per share amounts in the
accompanying financial statements have been adjusted retroactively to
reflect the stock split. The weighted average number of outstanding
shares was 31,209,997 and 31,189,604 for the three months ended March 31,
1996 and 1995, respectively.
(3) The Company is contingently liable under pending lawsuits and other
claims, some of which involve substantial sums. Considering certain
liabilities which have been set up for the lawsuits and claims, and the
difficulty in determining the ultimate liability in some of these matters,
internal counsel is of the opinion that the amounts, if any, which
ultimately might be due in connection with such lawsuits and claims would
not have a material adverse effect upon the Company's consolidated
financial condition.
(4) The notes to the consolidated financial statements on pages 19 through 32
of the Company's 1995 Form 10-K are an integral part of these consolidated
financial statements.
<PAGE> 6
PART I - Item 2
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS.
Net earnings were $38,022,000 for the quarter ended March 31, 1996
compared to $33,490,000 for the first quarter of 1995. Sales and other
operating revenues were $965,115,000 compared to $863,188,000 for first quarter
1995. Earnings per share were $1.22 compared to $1.07 per share for the first
quarter of last year.
The net earnings increase in the first quarter 1996 was largely
attributable to increased Upstream (exploration, production and natural gas
marketing) earnings with higher natural gas prices and trading margins,
reflecting abnormally cold weather in the eastern half of the United States.
Increased Chemicals production and sales partially offset lower Chemicals
margins. In the Downstream (refining, marketing and supply and transportation)
refining margins declined from the same period last year.
The Board of Directors increased the cash dividend by 17% beginning in
June 1996; i.e. from 60 cents per share to 70 cents per share.
Upstream results in the first quarter were improved compared with the
corresponding period last year primarily due to higher wellhead prices for
crude oil and natural gas, lifting costs decreased, and Natural Gas Marketing
had outstanding trading results. During first quarter 1996, the Company
announced an enhanced oil recovery joint venture in its West Brahaney Unit in
West Texas, utilizing carbon dioxide injection. Nine unit producing wells and
one injection well were completed, adding reserves at low cost. A third
successful well was completed at the King Bee prospect in Mississippi, and two
additional wells were begun.
<PAGE> 7
Downstream reported decreased earnings in the quarter compared to first
quarter 1995. The results were primarily due to planned maintenance and capital
project work at the Big Spring, Texas, refinery and much lower aromatic
margins, which are particularly important to the Port Arthur, Texas, refinery
where the Company is one of the leading aromatics producers. The Big Spring
Refinery completed a turnaround of the fluid catalytic cracking unit ("FCCU"),
the crude unit, and the reformer. Also during the turnaround, a FCCU
enhancement project was installed to improve yields of higher value products.
The Port Arthur Refinery achieved new records for quarterly throughput and
operations reliability.
Chemicals achieved record sales and production volumes, each of which
increased by more than 25% compared to first quarter 1995, primarily due to the
LaPorte Polypropylene expansion. These increases did not fully offset the
financial effect of lower margins caused by increased industry wide inventory,
resulting in lower profitability. The polystyrene expansion project at
Carville, Louisiana, which involves building a new 250 million pound per year
crystal polystyrene production line, is on schedule for start-up by July 1 of
1996.
The Company's annual meeting of shareholders was held April 17, 1996. All
members of the Board of Directors were reelected.
The Company's regular quarterly dividend of $.60 per share was paid March
18, 1996 to shareholders of record on March 6, 1996. Due to a 17% dividend
increase, the next declared dividend of $.70 per share will be paid on June 17,
1996 to shareholders of record on June 3, 1996.
<PAGE> 8
Part II - OTHER INFORMATION
Item 1. Legal Proceedings.
Not Applicable
Item 2. Changes in Securities.
(a) Not Applicable
(b) Not Applicable
Item 3. Defaults upon Senior Securities.
Not Applicable
Item 4. Submission of Matters to a Vote of Security Holders. At the annual
meeting of shareholders, held April 17, 1996, all directors were
reelected by more than a majority vote.
Item 5. Other Information.
Not Applicable
Item 6. Exhibits and Reports on Form 8-K.
No Form 8-K's were filed during the period January 1, 1996 through
March 31, 1996. Form 10-K/A Amendment Number 1 and Form 10-K/A
Amendment Number 2 were filed on April 23, 1996 as cover for the Forms
11-K pertaining to the FINA Capital Accumulation Plan (a 401(k) plan)
and the Amdel Savings Plan.
Exhibits incorporated herein by reference:
(27) Financial Data Schedule
SIGNATURES
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 thereunto duly authorized.
FINA, Inc.
------------
(REGISTRANT)
Date: May 10, 1996
BY:
Yves Bercy
Vice President, Chief
Financial Officer and
Treasurer
<PAGE> 9
INDEX TO EHXIBITS
EXHIBIT
NUMBER DESCRIPTION
- ------- -----------
27 Financial Data Schedule
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
(THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM CONDENSED
CONSOLIDATED BALANCE SHEETS AND FROM CONSOLIDATED STATEMENTS OF EARNINGS AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS)
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> MAR-31-1996
<CASH> 4,470
<SECURITIES> 0
<RECEIVABLES> 418,918
<ALLOWANCES> 0
<INVENTORY> 305,358
<CURRENT-ASSETS> 776,888
<PP&E> 1,655,961
<DEPRECIATION> 1,415,314
<TOTAL-ASSETS> 2,582,921
<CURRENT-LIABILITIES> 620,460
<BONDS> 494,899
<COMMON> 15,606
0
0
<OTHER-SE> 1,181,917
<TOTAL-LIABILITY-AND-EQUITY> 2,582,921
<SALES> 965,115
<TOTAL-REVENUES> 962,400
<CGS> 724,868
<TOTAL-COSTS> 93,791
<OTHER-EXPENSES> 76,445
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 9,738
<INCOME-PRETAX> 57,558
<INCOME-TAX> 19,536
<INCOME-CONTINUING> 38,022
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 38,022
<EPS-PRIMARY> 1.22
<EPS-DILUTED> 0
</TABLE>
