SECURITIES AND EXCHANGE COMMISSION
Washington, DC. 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) October 27, 1997
------------------
UNOCAL CORPORATION
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware
- --------------------------------------------------------------------------------
(State or Other Jurisdiction of Incorporation)
1-8483 95-3825062
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(Commission File Number) (I.R.S. Employer Identification No.)
2141 Rosecrans Avenue, Suite 4000, El Segundo, California 90245
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(Address of Principal Executive Offices) (Zip Code)
(310) 726-7600
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(Registrant's Telephone Number, Including Area Code)
<PAGE>
Item 5. Other Events.
On October 27, 1997 the following news release was issued:
UNOCAL POSTS HIGHER 3Q EARNINGS;
SEES IMPROVED DOMESTIC NATURAL GAS PRICES
-----------------------------------------
El Segundo, Calif., Oct. 27, 1997 -- Unocal Corporation today reported
third quarter 1997 earnings from continuing operations of $177 million, or 71
cents per share, compared with earnings from continuing operations of $134
million, or 32 cents per share, for the same period a year ago.
Earnings from continuing operations, excluding special items (detailed in
attached tables) were $94 million, or 38 cents per share, compared with $118
million, or 25 cents per share, in the third quarter 1996.
The 1997 third quarter operating earnings reflect improved foreign natural
gas and crude oil production and higher worldwide natural gas prices. These were
more than offset by lower domestic crude oil and natural gas production and
lower worldwide crude oil prices.
For the quarter, net natural gas production in Thailand was up 24 percent
to 634 million cubic feet per day, compared with the third quarter 1996. In
Indonesia, Unocal's net crude oil production (including host country share)
averaged 73,033 barrels per day, up 14 percent from a year ago.
The third quarter special items included $182 million in deferred income
tax benefits -- $114 million related to a reassessment of Unocal's exposure for
pending federal income tax appeals and $68 million related to the recent
currency devaluation in Thailand. The 1996 earnings per share amounts reflect a
one-time $54 million non-cash reduction resulting from the exchange of preferred
stock.
<PAGE>
"We continued to post higher crude oil and natural gas production in our
foreign operations," said Roger C. Beach, Unocal chairman and chief executive
officer. "In addition, net interest expense declined $18 million due to debt
reduction."
Beach noted that the company's total debt was $2.08 billion, down $980
million from year-end 1996. Cash flow from operations in the third quarter,
before working capital changes, was $307 million, compared with $450 million
last year.
To date, the company has purchased approximately 4.5 million common shares
for $172 million under the company's $400 million stock repurchase program.
Reported earnings for the third quarter, including discontinued operations
and special items, were $177 million, or 71 cents per common share. This
compares with $171 million, or 47 cents per common share, reported in the third
quarter a year ago.
FORECAST FOR 1997 EARNINGS, GAS PRICES
"Based on our internal forecasts, we expect our fourth quarter adjusted
earnings to be 57 to 63 cents per share," Beach said. The company's earnings
forecast assumes that Unocal realizes domestic commodity prices based on the
present NYMEX futures prices and improvements in operating results.
The company estimates that Unocal's Lower 48 U.S. natural gas prices could
average more than $3 per thousand cubic feet in the fourth quarter 1997, up 75
cents from the third quarter. This increase alone would boost Unocal's aftertax
earnings by about 15 cents per share. Each 10-cent change in realized Lower 48
U.S. gas prices results in a quarterly earnings impact of $5 million, or about 2
cents per share.
"We are also looking at stronger sales and improved earnings from nitrogen
fertilizer products in the last three months of the year, compared with the
third quarter, and higher geothermal earnings, reflecting additional revenues
from new power plants in Indonesia," Beach said.
Beach also noted that the company's deepwater exploration program in
Indonesia continues to yield successes. Unocal recently completed a 3-D seismic
survey in the Makassar contract area, and an additional confirmation well, Merah
Besar #4, tested 21.7 million cubic feet of gas per day. This was a horizontal
well in the Pliocene gas sands and provided important new data critical to
development of the area. Four additional confirmation wells are planned in the
area to test the Miocene oil-bearing sands.
NINE-MONTH 1997 RESULTS
For the nine months, earnings from continuing operations were $521 million
or $2.09 per share, compared with $453 million, or $1.54 per share in 1996.
Excluding special items, earnings from continuing operations for the nine
months were $381 million, or $1.53 per share, compared with $402 million, or
$1.32 per share.
<PAGE>
The reported net earnings for the first nine months of 1997, including
discontinued operations and special items, were $439 million, or $1.76 per
share. This compares with $533 million or $1.86 per share, recorded for the
first nine months 1996.
Unocal is a leading global energy resource and project development company,
with reserves of more than 9.8 trillion cubic feet of natural gas equivalent
(1.6 billion barrels of oil equivalent) and major oil and gas production
activities in Asia and the U.S. Gulf of Mexico.
Forward-looking statements in this news release, including estimates of
profitability and cash flows, are based on assumptions concerning market,
competitive, regulatory, environmental, operational and other considerations.
Actual results could differ materially.
News releases and other information about Unocal are available at the
company's Internet website, www.unocal.com.
<PAGE>
<TABLE>
<CAPTION>
NEWS RELEASE UNOCAL CORPORATION
CONDENSED CONSOLIDATED EARNINGS STATEMENT
(UNAUDITED)
For the Three Months For the Nine Months
Ended September 30 Ended September 30
---------------------- ------------------------
Dollars in millions except per share amounts 1997 1996 1997 1996
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Total revenues ................................................. $ 1,397 $ 1,337 $ 4,507 $ 3,943
Costs and other deductions ..................................... 1,394 1,145 3,918 3,206
------- ------- ------- -------
Earnings from continuing operations before income taxes ........ 3 192 589 737
Income taxes ................................................... (174) 58 68 284
------- ------- ------- -------
Earnings from continuing operations ............................ 177 134 521 453
Earnings from discontinued operations (net of tax) ............ -- 37 -- 80
Loss on disposal (net of tax) ................................. -- -- (44) --
Extraordinary charge - extinguishment of debt (net of tax) ..... -- -- (38) --
------- ------- ------- -------
Net earnings ................................................... $ 177 $ 171 $ 439 $ 533
Dividends on preferred stock ................................... -- -- -- 18
Non-cash charge related to exchange of preferred stock ......... -- 54 -- 54
------- ------- ------- -------
Net earnings applicable to common stock ........................ $ 177 $ 117 $ 439 $ 461
Earnings/(loss) per common share assuming no dilution (a)
Continuing operations .................................... $ 0.71 $ 0.32 $ 2.09 $ 1.54
Discontinued operations .................................. -- 0.15 (0.18) 0.32
Extraordinary item - extinguishment of debt (net of tax) -- -- (0.15) --
------- ------- ------- -------
Net earnings per share ......................................... $ 0.71 $ 0.47 $ 1.76 $ 1.86
<FN>
(a) ..Based on weighted average common shares
outstanding (in millions) ............................... 247 249 249 248
</FN>
- --------------------------------------------------------------------------------------------------------------------
CONDENSED CONSOLIDATED BALANCE SHEET
(UNAUDITED)
Sep. 30 Dec. 31
Millions of dollars 1997 1996
- --------------------------------------------------------------------------------------------------------------------
Assets
Cash and cash equivalents ..................................... $ 516 $ 217
Net assets of discontinued operations (b) .................... -- 1,774
Other current assets .......................................... 1,045 1,237
Investments and long-term receivables ......................... 1,081 1,206
Properties - net .............................................. 4,688 4,590
Other assets .................................................. 127 99
------- ------
Total assets .......................................... $7,457 $9,123
Liabilities and Equity
Current portion of long-term debt and capital lease obligations $ -- $ 118
Other current liabilities ..................................... 975 1,504
Long-term debt and capital lease obligations .................. 2,078 2,940
Deferred income taxes ......................................... 166 348
Other deferred credits and liabilities ........................ 1,311 1,416
Convertible preferred securities .............................. 522 522
Stockholders' equity .......................................... 2,405 2,275
------- -------
Total liabilities and equity .......................... $7,457 $9,123
<FN>
(b) Excludes retained working capital .........................
</FN>
Table 1
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
NEWS RELEASE UNOCAL CORPORATION
CONDENSED CONSOLIDATED CASH FLOWS
(INCLUDES DISCONTINUED OPERATIONS)
(UNAUDITED) For the Three Months For the Nine Months
Ended September 30 Ended September 30
-----------------------------------------------------
Millions of dollars 1997 1996 1997 1996
- ----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Cash flows from operating activities
Net earnings $ 177 $ 171 $ 439 $ 533
Adjustments to reconcile net earnings to
net cash provided by operating activities
Loss on disposal of discontinued operations (before-tax) -- -- 71 --
Depreciation, depletion and amortization 300 228 755 724
Dry hole costs 8 53 51 72
Deferred income taxes (255) 15 (226) 48
Gain on sales of assets (before-tax) 2 (36) (59) (173)
Other 75 19 (83) 96
Working capital and other changes related to operations (8) 56 (212) (101)
-----------------------------------------------------
Net cash provided by operating activities 299 506 736 1,199
Cash flows from investing activities
Capital expenditures (includes dry hole costs) (308) (318) (953) (940)
Proceeds from sale of discontinued operations 3 -- 1,789 --
Proceeds from asset sales 7 46 55 585
-----------------------------------------------------
Net cash provided by/(used in) investing activities (298) (272) 891 (355)
Cash flows from financing activities
Net decrease in long-term debt
and capital lease obligations (241) (171) (959) (560)
Dividends paid (50) (59) (150) (176)
Repurchase of common stock (81) -- (173) --
Other 3 12 (46) 23
-----------------------------------------------------
Net cash used in financing activities (369) (218) (1,328) (713)
Increase/(decrease) in cash and cash equivalents (368) 16 299 131
Cash and cash equivalents at beginning of period 884 209 217 94
-----------------------------------------------------
Cash and cash equivalents at end of period $ 516 $ 225 $ 516 $ 225
- ----------------------------------------------------------------------------------------------------------------------------
CONDENSED CAPITAL EXPENDITURES
(UNAUDITED)
Millions of dollars
- ----------------------------------------------------------------------------------------------------------------------------
United States Exploration & Production $ 88 $ 92 $ 200 $ 327
International Exploration & Production 171 96 574 312
Geothermal Operations 29 39 76 91
Diversified Business Group 18 8 40 26
New Ventures (Non E & P) 2 5 5 5
Corporate & Unallocated -- 10 9 22
Discontinued Operations -- 68 49 157
-----------------------------------------------------
Total (a) $ 308 $ 318 $ 953 $ 940
(a) Includes capitalized interest of: $ 10 $ 3 $ 26 $ 9
- ----------------------------------------------------------------------------------------------------------------------------
DEPRECIATION, DEPLETION & AMORTIZATION
(UNAUDITED)
Millions of dollars
- ----------------------------------------------------------------------------------------------------------------------------
Depreciation, depletion & amortization from continuing operations $ 300 $ 192 $ 755 $ 617
Table 2
<PAGE>
</TABLE>
<TABLE>
<CAPTION>
NEWS RELEASE UNOCAL CORPORATION
DISCRETIONARY CASH FLOW
(INCLUDES DISCONTINUED OPERATIONS)
(UNAUDITED) For the Three Months For the Nine Months
Ended September 30 Ended September 30
--------------------------------------------------------
Millions of dollars 1997 1996 1997 1996
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Net earnings ....................................................... $ 177 $ 171 $ 439 $ 533
Adjustments to net earnings
Depletion, depreciation & amortization .............. 238 228 693 724
SFAS no. 121 impairment ............................. 62 -- 62 --
Dry hole costs ...................................... 8 53 51 72
Deferred income taxes ............................... (255) 15 (226) 48
(Gain) Loss on sales of assets ...................... 2 (36) (59) (173)
Exploration expenses ................................ 50 33 114 83
Proceeds from asset sales ........................... 10 46 1,844 585
Environmental and litigation provision .............. 97 51 120 113
Environmental and litigation payments ............... (21) (23) (133) (53)
Other, net .......................................... (1) (9) 1 36
--------------------------------------------------------
Total discretionary cash flow ................. $ 367 $ 529 $ 2,906 $ 1,968
<FN>
The preceding table of discretionary cash flow is provided for analysts and
others in the investment community as a supplement to conventional financial
data prepared in accordance with generally accepted accounting principles.
Discretionary cash flow does not give effect to significant uses of cash,
including those for capital projects, debt reduction and regular dividends, some
of which result from previous commitments, and should only be considered in
conjunction with the full presentation of condensed consolidated cash flows on
the preceding page.
</FN>
</TABLE>
Table 2a
<PAGE>
<TABLE>
<CAPTION>
NEWS RELEASE UNOCAL CORPORATION
RESULTS OF OPERATIONS FOR
EXPLORATION AND PRODUCTION ACTIVITIES
(UNAUDITED)
For the Nine Months
Ended September 30, 1997
---------------------------------------------------------
Spirit Other Other
Millions of dollars Energy 76 U.S. Far East International Total
- -------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Sales (includes intercompany sales) (a)
Crude oil and condensate .............. $ 245 $ 136 $ 342 $ 119 $ 842
Natural gas ........................... 546 47 485 35 1,113
Natural gas liquids ................... 41 3 18 3 65
Other ................................. 2 -- -- -- 2
------- ------- ------- ------- -------
Total .......................... 834 186 845 157 2,022
Other revenue ................................ 10 4 2 16 32
Gain/(loss) on asset sales ................... 2 -- -- (16) (14)
------- ------- ------- ------- -------
Total revenues ................. 846 190 847 157 2,040
Production costs ............................. 139 73 93 53 358
Exploration expenses ......................... 37 -- 43 28 108
Dry hole costs ............................... 10 -- 39 1 50
Depreciation, depletion & amortization ....... 374 42 235 53 704
Other operating expenses ..................... 56 8 48 31 143
------- ------- ------- ------- -------
Results of operations before income tax $ 230 $ 67 $ 389 $ (9) $ 677
- -------------------------------------------------------------------------------------------------------
For the Nine Months
Ended September 30, 1996
--------------------------------------------------------
Spirit Other Other
Energy 76 U.S. Far East International Total
--------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Sales (includes intercompany sales) (a)
Crude oil and condensate .............. $ 287 $ 209 $ 278 $ 137 $ 911
Natural gas ........................... 562 61 362 35 1,020
Natural gas liquids ................... 47 4 12 3 66
Other ................................. 3 -- -- -- 3
------- ------- ------- ------- -------
Total .......................... 899 274 652 175 2,000
Other revenue ................................ 8 2 -- 17 27
Gain on asset sales .......................... 8 110 1 23 142
------- ------- ------- ------- -------
Total revenues ................. 915 386 653 215 2,169
Production costs ............................. 134 96 94 57 381
Exploration expenses ......................... 19 -- 31 28 78
Dry hole costs ............................... 49 -- 13 5 67
Depreciation, depletion & amortization ....... 268 74 163 44 549
Other operating expenses ..................... 100 13 30 4 147
------- ------- ------- ------- -------
Results of operations before income tax $ 345 $ 203 $ 322 $ 77 $ 947
<FN>
(a) Sales revenues are net of royalty payments, net profits interests and
marketing related purchases.
</FN>
Table 3
<PAGE>
</TABLE>
<TABLE>
<CAPTION>
NEWS RELEASE UNOCAL CORPORATION
RESULTS OF OPERATIONS FOR
EXPLORATION AND PRODUCTION ACTIVITIES
(UNAUDITED)
For the Three Months Ended
Ended September 30, 1997
-------------------------------------------------------
Spirit Other Other
Millions of dollars Energy 76 U.S. Far East International Total
- -----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Sales (includes intercompany sales) (a)
Crude oil and condensate .............. $ 67 $ 40 $ 112 $ 34 $ 253
Natural gas ........................... 171 15 168 11 365
Natural gas liquids ................... 12 -- 4 1 17
Other ................................. 1 -- -- -- 1
------ ------ ------ ------ ------
Total .......................... 251 55 284 46 636
Other revenue ................................ 4 3 (4) 3 6
Loss on asset sales .......................... (2) -- -- -- (2)
------ ------ ------ ------ ------
Total revenues ................. 253 58 280 49 640
Production costs ............................. 41 27 30 17 115
Exploration expenses ......................... 13 -- 25 10 48
Dry hole costs ............................... 3 -- 4 -- 7
Depreciation, depletion & amortization ....... 169 13 81 17 280
Other operating expenses ..................... 18 2 26 7 53
------ ------ ------ ------ ------
Results of operations before income tax $ 9 $ 16 $ 114 $ (2) $ 137
- -----------------------------------------------------------------------------------------------------
For the Three Months Ended
Ended September 30, 1996
-------------------------------------------------------
Spirit Other Other
Energy 76 U.S. Far East International Total
-------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Sales (includes intercompany sales) (a)
Crude oil and condensate .............. $ 104 $ 57 $ 95 $ 47 $ 303
Natural gas ........................... 178 18 132 10 338
Natural gas liquids ................... 17 1 3 1 22
Other ................................. 1 -- -- -- 1
------ ------ ------ ------ ------
Total .......................... 300 76 230 58 664
Other revenue ................................ 5 -- 1 6 12
Gain on asset sales .......................... 3 -- 1 17 21
------ ------ ------ ------ ------
Total revenues ................. 308 76 232 81 697
Production costs ............................. 46 19 31 20 116
Exploration expenses ......................... 8 -- 14 8 30
Dry hole costs ............................... 38 -- 11 1 50
Depreciation, depletion & amortization ....... 94 18 47 14 173
Other operating expenses ..................... 34 4 13 -- 51
------ ------ ------ ------ ------
Results of operations before income tax $ 88 $ 35 $ 116 $ 38 $ 277
<FN>
(a) Sales revenues are net of royalty payments, net profits interests and
marketing related purchases.
</FN>
Table 4
<PAGE>
</TABLE>
<TABLE>
<CAPTION>
NEWS RELEASE UNOCAL CORPORATION
OPERATING HIGHLIGHTS
(UNAUDITED) For the Three Months For the Nine Months
Ended September 30 Ended September 30
---------------------------------------------------
1997 1996 1997 1996
- -------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Net daily production
Crude oil and condensate (thousand barrels daily):
United States
Spirit Energy 76 .......................... 40.8 51.4 45.0 51.7
Other (a) ................................ 29.8 34.7 31.5 47.2
------- ------- ------- -------
Total United States ................. 70.6 86.1 76.5 98.9
International
Far East (b) ............................. 96.2 82.2 94.9 82.4
Other ..................................... 24.9 27.2 25.9 27.6
------- ------- ------- -------
Total International ................. 121.1 109.4 120.8 110.0
------- ------- ------- -------
Total Worldwide ..................... 191.7 195.5 197.3 208.9
Natural gas (million cubic feet daily):
United States
Spirit Energy 76 .......................... 844.5 928.4 875.7 917.0
Other (a) ................................ 109.6 146.8 130.8 164.5
------- ------- ------- -------
Total United States ................. 954.1 1,075.2 1,006.5 1,081.5
International
Far East (b) ............................. 790.0 666.5 789.5 625.7
Other ..................................... 54.8 63.0 61.7 71.1
------- ------- ------- -------
Total International ................. 844.8 729.5 851.2 696.8
------- ------- ------- -------
Total Worldwide .....................1,798.9 1,804.7 1,857.7 1,778.3
Natural gas liquids (thousand barrels daily) (a) ........ 17.8 19.3 18.7 19.6
Geothermal (million kilowatt-hours daily) ................ 18.7 21.0 17.2 17.3
Average sales prices
Crude oil and condensate (per barrel):
United States
Spirit Energy 76 ..........................$ 17.27 $ 21.80 $ 19.69 $ 20.33
Other ..................................... 13.36 17.37 15.39 16.52
Total United States ................. 15.57 20.01 17.90 18.31
International
Far East ..................................$ 17.45 $ 18.89 $ 18.72 $ 18.32
Other ..................................... 16.58 19.89 17.58 18.53
Total International ................. 17.23 19.21 18.41 18.39
Total Worldwide .....................$ 16.48 $ 19.62 $ 18.18 $ 18.34
Natural gas (per mcf):
United States
Spirit Energy 76 ..........................$ 2.28 $ 2.23 $ 2.41 $ 2.34
Other ..................................... 1.47 1.36 1.39 1.42
Total United States ................. 2.19 2.09 2.28 2.20
International
Far East ..................................$ 2.39 $ 2.27 $ 2.35 $ 2.23
Other ..................................... 2.40 2.05 2.23 1.82
Total International ................. 2.39 2.25 2.34 2.18
Total Worldwide .....................$ 2.28 $ 2.15 $ 2.30 $ 2.20
<FN>
------- ------- ------- -------
(a) Includes production from California upstream properties of:
Crude oil and condensate ............................... -- 1.0 -- 10.9
Natural gas ............................................ -- -- -- 17.2
Natural gas liquids .................................... -- -- -- 0.2
(b) Includes host country share in Indonesia of:
Crude oil and condensate ............................... 27.9 26.4 29.2 26.8
Natural gas ............................................ 21.9 29.1 26.6 26.2
</FN>
Table 5
<PAGE>
</TABLE>
<TABLE>
<CAPTION>
NEWS RELEASE UNOCAL CORPORATION
OPERATING HIGHLIGHTS (continued)
(UNAUDITED)
For the Three Months Ended For the Nine Months
Ended September 30 Ended September 30
--------------------------------------------------
1997 1996 1997 1996
- ------------------------------------------------------------------------------------------------------------------------------------
Agricultural products production volumes (thousand tons)
<S> <C> <C> <C> <C>
Ammonia ......................................................... 314 360 1,072 1,089
Urea ............................................................ 188 275 696 845
Other products .................................................. 146 149 494 494
Agricultural products sales volumes (thousand tons)
Ammonia ......................................................... 187 206 590 574
Urea ............................................................ 191 198 690 779
Other products .................................................. 200 302 907 971
Table 6
<PAGE>
</TABLE>
<TABLE>
<CAPTION>
NEWS RELEASE UNOCAL CORPORATION
EARNINGS BY BUSINESS SEGMENT
(Unaudited)
3rd Quarter of 1997 3rd Quarter of 1996
-------------------------------------------------------
Millions of dollars Before-tax After-tax Before-tax After-tax
- ------------------------------------------------------------------------------------------------------------------------------------
Exploration and Production
United States
<S> <C> <C> <C> <C>
Spirit Energy 76 ........................................... $ 9 $ 6 $ 88 $ 55
Other ...................................................... 16 10 35 22
International ................................................ 112 128 154 107
Geothermal Operations .......................................... 7 6 15 6
Diversified Business Group
Agricultural Products ...................................... 5 4 31 20
Carbon and Minerals ........................................ 13 10 15 13
Pipelines .................................................. 19 16 17 14
Other ...................................................... (1) -- 5 3
Corporate and Unallocated
Administrative and general expense ......................... (20) (13) (33) (21)
Net interest expense ....................................... (26) (19) (62) (37)
Environmental and litigation expense........................ (104) (65) (60) (37)
New Ventures ............................................... (3) (1) (10) (7)
Other ...................................................... (24) 95 (3) (4)
- ------------------------------------------------------------------------------------------------------------------------------------
Earnings from continuing operations
before discontinued operations
and extraordinary item ...................................... 3 177 192 134
Earnings from discontinued operations .......................... -- -- 59 37
- ------------------------------------------------------------------------------------------------------------------------------------
Extraordinary item ............................................. -- -- -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Total ................................................ $ 3 $ 177 $ 251 $ 171
====================================================================================================================================
<FN>
EXPLORATION AND PRODUCTION - this segment explores for, produces and markets
crude oil, condensate, natural gas and natural gas liquids.
GEOTHERMAL OPERATIONS - this segment explores for, produces and sells geothermal
resources used to generate electricity.
DIVERSIFIED BUSINESS GROUP:
AGRICULTURAL PRODUCTS - this business unit manufactures and markets
nitrogen-based products for wholesale agricultural and industrial markets
supplying the western United States and the Pacific Rim.
CARBON AND MINERALS - this business unit produces and markets petroleum
coke, graphites, solvents and specialty minerals.
PIPELINES - this business unit principally includes the company's equity
interests in affiliated pipeline companies.
OTHER- principally includes the company's equity interest in The UNO-VEN
company.
</FN>
</TABLE>
Table 7
<PAGE>
<TABLE>
<CAPTION>
NEWS RELEASE UNOCAL CORPORATION
SPECIAL ITEMS
(Unaudited)
3rd Quarter of 1997 3rd Quarter of 1996
------------------------------------------------------
Dollars in millions except per share amounts Before-tax After-tax Before-tax After-tax
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Reported earnings .............................................. $ 3 $ 177 $ 251 $ 171
Less: Special items
Exploration and Production
United States
Spirit Energy
Asset Sales ....................................... (1) -- 4 3
SFAS no.121 impairment ............................ (62) (39) -- --
International
Asset Sales ....................................... (1) (1) 18 37
Uninsured loss - Bangladesh ....................... -- -- -- --
Deferred tax adjustment ........................... -- 68 -- --
Geothermal Operations
Deferred tax adjustment ........................... -- 3 -- --
Corporate and Unallocated
Asset Sales ....................................... -- (1) 14 8
Environmental provision ........................... (65) (41) (20) (12)
Litigation provision .............................. (32) (20) (31) (20)
Deferred tax adjustment ........................... -- 114 -- --
Discontinued Operations
Asset Sales ....................................... -- -- 1 1
Other ........................................... -- -- 2 1
- ------------------------------------------------------------------------------------------------------------------------------------
Total special items ....................................... (161) 83 (12) 18
- ------------------------------------------------------------------------------------------------------------------------------------
Adjusted earnings .............................................. $ 164 $ 94 $ 263 $ 153
====================================================================================================================================
Table 8
<PAGE>
</TABLE>
<TABLE>
<CAPTION>
NEWS RELEASE UNOCAL CORPORATION
EARNINGS BY BUSINESS SEGMENT
EXCLUDING SPECIAL ITEMS
(Unaudited)
3rd Quarter of 1997 3rd Quarter of 1996
---------------------------------------------------------
Millions of dollars Before-tax After-tax Before-tax After-tax
- ------------------------------------------------------------------------------------------------------------------------------------
Exploration and Production
United States
<S> <C> <C> <C> <C>
Spirit Energy 76 .......................................... $ 72 $ 45 $ 84 $ 52
Other ..................................................... 16 10 35 22
International ................................................ 113 61 136 70
Geothermal Operations .......................................... 7 3 15 6
Diversified Business Group
Agricultural Products ...................................... 5 4 31 20
Carbon and Minerals ........................................ 13 10 15 13
Pipelines .................................................. 19 16 17 14
Other ...................................................... (1) -- 5 3
Corporate and Unallocated
Administrative and general expense ......................... (20) (13) (33) (21)
Net interest expense ....................................... (26) (19) (62) (37)
Environmental and litigation expense ....................... (7) (4) (9) (5)
New Ventures ............................................... (3) (1) (10) (7)
Other ...................................................... (24) (18) (17) (12)
- ------------------------------------------------------------------------------------------------------------------------------------
Earnings from continuing operations ............................ 164 94 207 118
Earnings from discontinued operations .......................... -- -- 56 35
- ------------------------------------------------------------------------------------------------------------------------------------
Total ................................................ $ 164 $ 94 $ 263 $ 153
Non-cash charge related to
exchange of preferred stock ................................. -- -- -- 54
- ------------------------------------------------------------------------------------------------------------------------------------
Adjusted net earnings applicable
to common stock ............................................. $ 94 $ 99
- ------------------------------------------------------------------------------------------------------------------------------------
Adjusted net earnings
per common share ............................................ $0.38 $0.39
Adjusted net earnings from continuing
operations per common share ................................. $0.38 $0.25
===================================================================================================================================
</TABLE>
Table 9
<PAGE>
<TABLE>
<CAPTION>
NEWS RELEASE UNOCAL CORPORATION
EARNINGS BY BUSINESS SEGMENT
(Unaudited)
First Nine Months of 1997 First Nine Months of 1996
---------------------------------------------------------
Millions of dollars Before-tax After-tax Before-tax After-tax
- ------------------------------------------------------------------------------------------------------------------------------------
Exploration and Production
United States
<S> <C> <C> <C> <C>
Spirit Energy 76 ........................................ $ 230 $ 144 $ 345 $ 215
Other ................................................... 67 42 203 126
International .............................................. 380 259 399 245
Geothermal Operations .......................................... 28 25 33 15
Diversified Business Group
Agricultural Products .................................... 75 50 113 73
Carbon and Minerals ...................................... 110 76 52 40
Pipelines ................................................ 54 46 64 51
Other .................................................... 43 37 15 9
Corporate and Unallocated
Administrative and general expense ....................... (62) (40) (87) (55)
Net interest expense ..................................... (109) (84) (197) (135)
Environmental and litigation expense ..................... (138) (86) (136) (84)
New Ventures ............................................. (34) (23) (20) (13)
Other .................................................... (55) 75 (47) (34)
- ------------------------------------------------------------------------------------------------------------------------------------
Earnings from continuing operations
before discontinued operations
and extraordinary item ...................................... 589 521 737 453
Earnings (loss) from discontinued operations ................... (71) (44) 128 80
Extraordinary item ............................................. (52) (38) -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Total .............................................. $ 466 $ 439 $ 865 $ 533
====================================================================================================================================
Table 10
<PAGE>
</TABLE>
<TABLE>
<CAPTION>
NEWS RELEASE UNOCAL CORPORATION
SPECIAL ITEMS
(Unaudited)
First Nine Months of 1997 First Nine Months of 1996
---------------------------------------------------------
Dollars in millions except per share amounts Before-tax After-tax Before-tax After-tax
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Reported earnings .............................................. $ 466 $ 439 $ 865 $ 533
Less: Special items
Exploration and Production
United States
Spirit Energy
Asset Sales ....................................... 2 2 8 5
SFAS no.121 impairment ............................ (62) (39) -- --
Other
Asset Sales ....................................... -- -- 110 68
International
Asset Sales ....................................... (17) (17) 24 41
Uninsured loss - Bangladesh ....................... (10) (7) -- --
Deferred tax adjustment ........................... -- 68 -- --
Geothermal Operations
Deferred tax adjustment ........................... -- 10 -- --
Diversified Business Group
Carbon and Minerals
Asset Sales ....................................... 67 41 -- --
Pipeline
Asset Sales ....................................... -- -- 12 7
Other
UNO-VEN restructuring ............................. 46 39 -- --
Corporate and Unallocated
Asset Sales ....................................... 7 4 15 9
Environmental provision ........................... (80) (50) (62) (38)
Litigation provision .............................. (40) (25) (51) (32)
Deferred tax adjustment ........................... -- 114 -- --
Other ............................................. -- -- (11) (9)
Discontinued Operations
Asset Sales ....................................... -- -- 5 3
Other .............................................. -- -- 2 1
Net loss on disposal .............................. (71) (44) -- --
Extraordinary item ......................................... (52) (38) -- --
---------------------------------------------------------
Total special items ....................................... (210) 58 52 55
---------------------------------------------------------
Adjusted earnings ............................................. $ 676 $ 381 $ 813 $ 478
===================================================================================================================================
Table 11
<PAGE>
</TABLE>
<TABLE>
<CAPTION>
NEWS RELEASE UNOCAL CORPORATION
EARNINGS BY BUSINESS SEGMENT
EXCLUDING SPECIAL ITEMS
(Unaudited)
First Nine Months of 1997 First Nine Months of 1996
--------------------------------------------------------
Millions of dollars Before-tax After-tax Before-tax After-tax
- ------------------------------------------------------------------------------------------------------------------------------------
Exploration and Production
United States
<S> <C> <C> <C> <C>
Spirit Energy 76 ........................................ $ 290 $ 181 $ 337 $ 210
Other ................................................... 67 42 93 58
International .............................................. 407 215 375 204
Geothermal Operations .......................................... 28 15 33 15
Diversified Business Group
Agricultural Products .................................... 75 50 113 73
Carbon and Minerals ...................................... 43 35 52 40
Pipelines ................................................ 54 46 52 44
Other .................................................... (3) (2) 15 9
Corporate and Unallocated
Administrative and general expense ....................... (62) (40) (87) (55)
Net interest expense ..................................... (109) (84) (197) (135)
Environmental and litigation expense ..................... (18) (11) (23) (14)
New Ventures ............................................. (34) (23) (20) (13)
Other .................................................... (62) (43) (51) (34)
- ------------------------------------------------------------------------------------------------------------------------------------
Earnings from continuing operations ............................ 676 381 692 402
Earnings from discontinued operations .......................... -- -- 121 76
- ------------------------------------------------------------------------------------------------------------------------------------
Total ....................................................... $ 676 $ 381 $ 813 $ 478
Dividends on preferred stock ................................... -- 18
Non-cash charge related to
exchange of preferred stock ................................. -- 54
- ------------------------------------------------------------------------------------------------------------------------------------
Adjusted net earnings applicable
to common stock ............................................. $ 381 $ 406
- ------------------------------------------------------------------------------------------------------------------------------------
Adjusted net earnings
per common share ............................................ $1.53 $1.63
- ------------------------------------------------------------------------------------------------------------------------------------
Adjusted net earnings from continuing
operations per common share ................................. $1.53 $1.32
====================================================================================================================================
Table 12
<PAGE>
</TABLE>
<PAGE>
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.
UNOCAL CORPORATION
(Registrant)
Date: October 27, 1997 By: /s/ STANLEY Y. HANAOKA
- ----------------------- ------------------------------
Stanley Y. Hanaoka
Assistant Comptroller
