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
Date of Report (Date of Earliest event reported): January 19, 1994
SANTA FE PACIFIC CORPORATION
(Exact Name of Registrant as Specified in Its Charter)
Delaware
(State or Other Jurisdiction of Incorporation)
1-8627 36-3258709
(Commission File Number) (I.R.S. Employer
Identification No.)
1700 East Golf Road, Schaumburg, Illinois 60173-5860
(Address of Principal Executive Offices) (zip code)
(708) 995-6000
(Registrant's Telephone Number, Including Area Code)
(Not Applicable)
(Former Name or Former Address, If Changed Since Last Report)
<PAGE>
ITEM 5. OTHER EVENTS
Santa Fe Pacific Corporation announced its 1993 earnings in
a January, 1994, press release, which press release is attached
as Exhibit 99 and is hereby incorporated by reference.
Attached as Exhibit 12.1 is a statement regarding
computation of ratio of earnings to fixed charges (as of December
31, 1993).
<PAGE>
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 hereunto duly authorized.
SANTA FE PACIFIC CORPORATION
(Registrant)
Date: January 19, 1994 By: /s/ Thomas N. Hund
--------------------------------
(Signature)
Thomas N. Hund
Vice President and Controller
<PAGE>
EXHIBIT INDEX
-------------
EXHIBIT
NUMBER Description of Exhibit
------- ----------------------
12.1 Statement regarding computation of ratio of
earnings to fixed charges (as of December 31,
1993).
99 Santa Fe Pacific Corporation News Release dated
January 19, 1994.
Santa Fe Pacific Corporation
Statement of Computation of Earnings to Fixed Charges (as of December 31, 1993)
(In millions, except ratio)
Year Ended
December 31,
1993
------------
Earnings:
Income from continuing operations
before income taxes $ 650.2
Add distributions greater than income
of unconsolidated subsidiaries 5.4
Amortization of capitalized interest 2.0
Fixed charges before interest
capitalized (see below) 173.7
---------
Total Earnings $ 831.3
=========
Fixed Charges:
Interest expense including
amortization of debt discount $ 142.4
Portion of rentals representing
an interest factor 31.3
---------
Fixed charges before interest
capitalized 173.7
Interest capitalized 8.7
---------
Total Fixed Charges $ 182.4
=========
Ratio of earnings to fixed charges 4.6
=========
Earnings in 1993 include a $145.4 million gain on the sale of rail lines in
southern California and a $217.5 million gain on the exchange of mineral
assets. Excluding these gains the ratio would have been 2.6.
News Release FOR IMMEDIATE RELEASE: JANUARY 19, 1994
Santa Fe Pacific Corporation
1700 East Golf Road
Schaumburg, Illinois 60173-5860
Corporate Communications Department
Contact: Cathy Westphal
(708) 995-6273
Release # 13
HIGHLIGHTS
Fourth Quarter 1993
Overall Results
- Net income of $67.0 million up 53% from 1992 adjusted net
income
- Earnings of $0.36 per share
- Higher operating income at all segments
Railway Results
- Record operating income of $114.8 million up 25%, including
an $8 million recovery of flood costs
- Revenues of $631.1 million up 9%
- Traffic volumes up 8%
- Operating ratio improves to 81.8%
Gold Results
- Operating income of $21.2 million more than double 1992
- 241,000 ounces of gold sold
- Reserves increased to 14.1 million ounces, up 26% since June
30, 1993
Pipelines Results
- Operating income of $7.5 million up $0.6 million
Other Highlights
- Interest expense of $32.8 million decreased 24%
<PAGE>
FOR IMMEDIATE RELEASE MEDIA CONTACT: Cathy Westphal
#13 (708) 995-6273
FOURTH QUARTER EARNINGS PER SHARE RISE 50%
SCHAUMBURG, ILLINOIS, JANUARY 19, 1994 -- Santa Fe Pacific
Corporation (SFP) reported fourth quarter net income of $67.0
million, or $0.36 per share compared to adjusted net income of
$43.9 million, or $0.24 per share last year. Including a pre-tax
gain of $204.9 million related to the sale of rail lines in
southern California and an after tax extraordinary charge of $5.0
million for early retirement of debt, 1992 net income was $168.9
million or $0.91 per share.
"Our fourth quarter performance was a great finish for the
company in 1993," said Robert D. Krebs, chairman, president and
chief executive officer. "The railroad achieved the highest
quarterly operating income in its history and our gold company
more than doubled its 1992 fourth quarter earnings."
RAILWAY RESULTS
Santa Fe Railway reported fourth quarter operating income of
$114.8 million, a 25% increase over 1992. The quarterly
operating ratio improved to 81.8% from 84.1% last year.
Revenues of $631.1 million increased 9% resulting from an 8%
increase in loadings and
- more -
<PAGE>
SFP Earnings
Page 2
a 1% increase in average revenue per car. Intermodal shipments
increased 8% reflecting continued strength in direct marketing
and international business. Carload shipments also increased 8%
due to growth in automotive and coal business.
Quarterly operating expenses of $516.3 million increased 6%
compared to 1992, primarily due to increased traffic.
Compensation and benefits expense of $199.8 million rose 3% from
1992 as increases in traffic were partially offset by operating
efficiencies. Fuel expense of $66.9 million increased $9.5
million due to a 10% increase in consumption and a 6% increase in
price. Fuel expense includes a 4.3 cents per gallon fuel tax
increase that went into effect on October 1. Equipment rents of
$59.3 million increased $7.9 million due to volume increases and
additional equipment leased for new business. Other expenses of
$112.7 million increased $5.0 million and include higher
intermodal drayage and other contract service costs, which were
partially offset by the recovery of approximately $8 million for
certain flood costs incurred during the third quarter.
GOLD RESULTS
Santa Fe Pacific Gold's (SFPG) quarterly operating income of
$21.2 million rose $11.5 million compared to the same quarter
last year. Gold sales increased 178,000 ounces to 241,000 ounces
due to increased sales at all operations including mines acquired
as part of the asset exchange completed in the second quarter
with Hanson Natural Resources Company. Fourth quarter 1992
results included income from coal and aggregate assets which were
exchanged with Hanson.
- more -
<PAGE>
SFP Earnings
Page 3
For the quarter, average sales price per ounce of $382 was
$8 below 1992, but $9 per ounce higher than the average spot
price for the quarter. Average cash production cost was $165 per
ounce, compared to $201 in 1992. Total cost per ounce decreased
$26 to $239. Both cash and total production cost per ounce
benefitted from increased production and other efficiencies.
Yesterday, SFPG announced a 26% increase in proven and
probable contained gold reserves from 11.2 million ounces
announced as of June 30, 1993 to 14.1 million ounces as of
December 31, 1993. SFPG has more than doubled its reserves since
the end of 1992.
PIPELINE RESULTS
SFP's equity investment in Santa Fe Pacific Pipeline
Partners, L.P., produced operating income of $7.5 million in the
fourth quarter, compared to $6.9 million last year because of an
increase in revenues from commercial shipments.
OTHER INCOME AND INTEREST EXPENSE
Other income-net of $1.2 million decreased $6.1 million due
principally to reduced land sales by the railroad. Interest
expense of $32.8 million declined $10.3 million from 1992
reflecting lower outstanding debt levels.
1993 ANNUAL RESULTS
Excluding special items, SFP reported adjusted net income of
$167.6 million, or $0.90 per share for the year compared to
$138.8 million, or $0.75 per share in 1992. The improved 1993
performance is due to higher Railway and Gold operating income
and lower interest expense, offset by lower other income-net
related to reduced land sales and interest income. The higher
operating income at Santa Fe Railway reflects growth in traffic
and continued operating
- more -
<PAGE>
SFP Earnings
Page 4
efficiencies, and occurred despite depressed third quarter income
due to the flood. The increase in Gold operating income includes
the benefits of increased production at all operations including
mines acquired as part of the asset exchange completed in the
second quarter with Hanson.
Including special items, SFP reported net income of $338.8
million, or $1.81 per share for the year compared to a loss of
$104.5 million, or $0.57 per share in 1992. Annual 1993 results
include a $32.0 million increase in tax expense for the
retroactive effect of the increase in the maximum corporate
federal income tax rate from 34% to 35%, $12.2 million in pre-tax
expense for SFP's portion of environmental and litigation charges
at Santa Fe Pacific Pipeline Partners, L.P., and $21.6 million in
pre-tax gains related to the favorable outcome of arbitration and
litigation settlements, all reflected in the third quarter. In
addition, 1993 includes a second quarter non-cash pre-tax gain of
$217.5 million on the asset exchange with Hanson and a first
quarter pre-tax gain of $145.4 million from the sale of rail
lines in southern California to various transit agencies.
The 1992 results include the previously described fourth
quarter gain on the sale of rail lines and the extraordinary
charge, as well as third quarter pre-tax charges totalling $324.9
million related to Railway's crew consist agreement and
operations centralization and increased environmental accruals at
Railway and Pipeline. Results in 1992 also include a net charge
of $163.0 million taken in the first quarter for the adoption of
a new accounting method for health and life insurance and
disability benefits for retired and inactive employees.
# # #
<PAGE>
<TABLE>
Santa Fe Pacific Corporation
Consolidated Statement of Operations
(Unaudited. In millions, except per share data)
<CAPTION>
Three Months Twelve Months
Ended December 31, Ended December 31,
1993 1992 1993 1992
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Revenues
Rail $ 631.1 $ 578.7 $ 2,409.2 $ 2,251.7
Gold 94.0 46.6 298.6 220.6
Pipeline 7.5 6.9 18.6 24.1
----------- ----------- ----------- -----------
Total revenues 732.6 632.2 2,726.4 2,496.4
----------- ----------- ----------- -----------
Operating Income
Rail 114.8 92.0 317.7 297.6
Rail Special Charge - - - (320.4)
Gold 21.2 9.7 86.5 76.3
Pipeline 7.5 6.9 18.6 24.1
----------- ----------- ----------- -----------
Total operating income 143.5 108.6 422.8 77.6
Other Income-Net 1.2 7.3 6.9 2.2
Gain on Sale of California Lines - 204.9 145.4 204.9
Gain on Exchange of Mineral Assets - - 217.5 -
Interest Expense 32.8 43.1 142.4 180.2
----------- ----------- ----------- -----------
Income Before Income Taxes 111.9 277.7 650.2 104.5
Income Tax 44.9 103.8 311.4 41.0
----------- ----------- ----------- -----------
Income Before Extraordinary Charge and
Cumulative Effect of a Change in Accounting 67.0 173.9 338.8 63.5
Extraordinary Charge on Early Retirement
of Debt, Net of Income Taxes - (5.0) - (5.0)
Cumulative Effect of a Change in Accounting
for Postretirement and Postemployment Benefits,
Net of Income Taxes - - - (163.0)
----------- ----------- ----------- -----------
Net Income (Loss) $ 67.0 $ 168.9 $ 338.8 $ (104.5)
=========== =========== =========== ===========
Income (Loss) Per Share of Common Stock
Before Extraordinary Charge and Cumulative
Effect of a Change in Accounting $ 0.36 $ 0.94 $ 1.81 $ 0.34
Extraordinary Charge - (0.03) - (0.03)
Cumulative Effect of a Change in Accounting - - - (0.88)
----------- ----------- ----------- -----------
Net Income (Loss) Per Share $ 0.36 $ 0.91 $ 1.81 $ (0.57)
=========== =========== =========== ===========
Average Number of Common and Common
Equivalent Shares 188.6 185.2 187.2 184.8
=========== =========== =========== ===========
</TABLE>
<PAGE>
<TABLE>
Santa Fe Pacific Corporation
(Unaudited, in millions)
Condensed Balance Sheet
<CAPTION>
December 31,
1993 1992
---------- ----------
<S> <C> <C>
Assets
Cash and cash equivalents $ 96.4 $ 100.1
Other current assets 482.1 437.5
---------- ----------
Total current assets 578.5 537.6
Properties and other assets 5,358.5 4,807.8
---------- ----------
Total Assets $ 5,937.0 $ 5,345.4
========== ==========
Liabilities and Shareholders' Equity
Current liabilities $ 921.8 $ 942.0
Long-term debt due after one year 1,185.1 1,245.7
Other liabilities 2,561.8 2,229.2
Shareholders' equity 1,268.3 928.5
---------- ----------
Total Liabilities and Shareholders' Equity $ 5,937.0 $ 5,345.4
========== ==========
</TABLE>
<TABLE>
Condensed Statement of Cash Flows
<CAPTION>
Three Months Twelve Months
Ended December 31, Ended December 31,
1993 1992 1993 1992
---------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
Cash Provided by Operations $ 127.2 $ 111.5 $ 351.9 $ 312.2
Cash Used for Capital Expenditures (159.4) (108.6) (488.6) (322.5)
Proceeds From Sale of Property,
Plant and Equipment 11.1 285.8 247.9 320.7
Net Borrowings (Repayments) 51.4 (213.0) (193.6) (426.5)
Cash Dividends Paid - (18.2) (18.5) (18.2)
Cash Provided by (Used for) Other Activities 22.6 (4.8) 97.2 70.8
---------- ---------- ---------- ----------
Increase (Decrease) in Cash and Cash Equivalents $ 52.9 $ 52.7 $ (3.7) $ (63.5)
========== ========== ========== ==========
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Santa Fe Pacific Corporation
Supplemental Data
(Unaudited)
Three Months Twelve Months
Ended December 31, Ended December 31,
1993 1992 1993 1992
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Rail
Operating expenses (In millions)
Compensation and benefits $ 199.8 $ 194.0 $ 799.8 $ 798.8
Fuel 66.9 57.4 239.1 205.5
Equipment rents 59.3 51.4 229.4 186.0
Depreciation and amortization 48.0 45.3 188.4 180.8
Materials and supplies 29.6 30.9 127.7 127.5
Other 112.7 107.7 507.1 455.5
Special charge - - - 320.4
----------- ----------- ----------- -----------
Total operating expenses $ 516.3 $ 486.7 $ 2,091.5 $ 2,274.5
=========== =========== =========== ===========
Operating ratio (1) 81.8 % 84.1 % 86.8 % 86.8 %
Revenue ton-miles (billions) 24.2 22.2 93.1 85.6
Revenue per revenue ton mile (cents) 2.56 2.57 2.54 2.58
Carloadings (thousands) 469.4 435.5 1,790.7 1,670.1
Average revenue per car $ 1,323 $ 1,306 $ 1,323 $ 1,323
Employees (period-end) 14,794 13,991 14,794 13,991
Gold
Ounces produced (thousands) 251 49 611 296
Ounces sold (thousands) 241 63 591 295
Average sales price (per ounce) $ 382 $ 390 $ 387 $ 394
Average production cost (per ounce) $ 239 $ 265 $ 243 $ 222
Average cash production cost (per ounce) $ 165 $ 201 $ 167 $ 162
Employees (period-end) 1,462 993 1,462 993
</TABLE>
(1) 1992 excludes $320.4 million special charge.
