<PAGE>
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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 JUNE 30, 1994
OR
/ / TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE
ACT OF 1934
FOR THE TRANSITION PERIOD FROM TO
COMMISSION FILE NUMBER 0-15095
----------------
TENNECO CREDIT CORPORATION
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
DELAWARE 76-0010368
(STATE OF INCORPORATION) (I.R.S. EMPLOYER IDENTIFICATION NO.)
TENNECO BUILDING, HOUSTON, TEXAS 77002
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES INCLUDING ZIP CODE)
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (713) 757-2131
----------------
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 FOR THE PAST 90 DAYS. YES X NO
INDICATE THE NUMBER OF SHARES OUTSTANDING OF EACH OF THE ISSUER'S CLASSES OF
COMMON STOCK AS OF THE LATEST PRACTICABLE DATE.
Common Stock, par value $5 per share: 200 shares as of June 30, 1994
TENNECO CREDIT CORPORATION MEETS THE CONDITIONS OF GENERAL INSTRUCTION
H(1)(A) AND (B) OF FORM 10-Q AND IS THEREFORE FILING THIS REPORT WITH A REDUCED
DISCLOSURE FORMAT AS PERMITTED BY SUCH INSTRUCTION.
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<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Part I--Financial Information
Tenneco Credit Corporation and Consolidated Subsidiaries--
Statement of Income................................................... 2
Statement of Cash Flows............................................... 3
Balance Sheet......................................................... 4
Statement of Changes in Stockholder's Equity.......................... 6
Notes to Financial Statements......................................... 7
Management's Discussion and Analysis of Financial Condition and
Results of Operations................................................ 8
Part II--Other Information
Item 1. Legal Proceedings............................................... *
Item 2. Changes in Securities........................................... *
Item 3. Defaults Upon Senior Securities................................. *
Item 4. Submission of Matters to a Vote of Security Holders............. *
Item 5. Other Information............................................... *
Item 6. Exhibits and Reports on Form 8-K................................ 11
</TABLE>
- --------
* No such response to this item is included herein for the reason that it is
inapplicable or the answer to such item is negative.
1
<PAGE>
PART I--FINANCIAL INFORMATION
TENNECO CREDIT CORPORATION
AND CONSOLIDATED SUBSIDIARIES
STATEMENT OF INCOME
(UNAUDITED)
<TABLE>
<CAPTION>
(THOUSANDS) (THOUSANDS)
THREE MONTHS SIX MONTHS ENDED
ENDED JUNE 30, JUNE 30,
---------------- -----------------
1994 1993 1994 1993
------- ------- ------- --------
<S> <C> <C> <C> <C>
REVENUES:
Earned finance charges and interest....... $43,502 $56,980 $83,128 $119,928
Rental income from affiliated company..... 1,432 1,432 2,864 2,864
------- ------- ------- --------
Total revenues............................ 44,934 58,412 85,992 122,792
------- ------- ------- --------
EXPENSES:
Interest--
Commercial paper......................... 1,345 723 2,350 1,813
Senior notes............................. 26,601 34,769 57,359 71,798
Subordinated notes....................... 2,281 2,280 4,537 4,510
Commitment fees and other................ 1,335 3,415 3,142 5,115
------- ------- ------- --------
31,562 41,187 67,388 83,236
Depreciation and amortization............. 497 497 994 994
Operating and administrative.............. (1,592) 879 (841) 1,686
------- ------- ------- --------
Total expenses............................ 30,467 42,563 67,541 85,916
------- ------- ------- --------
OTHER INCOME--Gain (loss) on sale of
receivables................................ (571) 24,040 25,514 25,907
------- ------- ------- --------
INCOME BEFORE INCOME TAXES.................. 13,896 39,889 43,965 62,783
INCOME TAXES................................ 5,641 16,336 17,787 25,033
------- ------- ------- --------
NET INCOME.................................. $ 8,255 $23,553 $26,178 $ 37,750
======= ======= ======= ========
</TABLE>
(The accompanying notes to financial statements are an
integral part of this statement of income.)
2
<PAGE>
TENNECO CREDIT CORPORATION
AND CONSOLIDATED SUBSIDIARIES
STATEMENT OF CASH FLOWS
(UNAUDITED)
<TABLE>
<CAPTION>
(THOUSANDS)
SIX MONTHS ENDED
JUNE 30,
-------------------
1994 1993
--------- --------
<S> <C> <C>
OPERATING ACTIVITIES:
Net income.............................................. $ 26,178 $ 37,750
Adjustments to reconcile to cash provided from operating
activities:
Depreciation and amortization......................... 994 994
Deferred income taxes................................. 2,109 26
Decrease in notes and accounts receivable purchased
from affiliates, net................................. 259,636 252,206
Change in accounts payable to and receivable from
affiliates........................................... 16,133 (1,977)
Decrease in accrued interest.......................... (8,809) (6,239)
Increase (decrease) in dealers' reserves.............. (3,415) 5,798
Change in other assets and other, net................. 103,582 24,007
--------- --------
CASH PROVIDED FROM OPERATING ACTIVITIES................... 396,408 312,565
--------- --------
INVESTING ACTIVITIES:
Collections on long-term notes receivable............... 131,240 7,434
Purchase of long-term notes receivable.................. (35,129) --
--------- --------
CASH PROVIDED FROM INVESTING ACTIVITIES................... 96,111 7,434
--------- --------
FINANCING ACTIVITIES:
Increase (decrease) in commercial paper................. (240,938) 20,448
Retirement of senior notes.............................. (251,567) (340,455)
--------- --------
CASH USED IN FINANCING ACTIVITIES......................... (492,505) (320,007)
--------- --------
INCREASE (DECREASE) IN CASH............................... 14 (8)
BEGINNING CASH BALANCE.................................... 4 13
--------- --------
ENDING CASH BALANCE....................................... $ 18 $ 5
========= ========
CASH PAID DURING THE PERIOD FOR:
Interest................................................ $ 75,360 $ 95,274
Income Taxes............................................ $ 15,678 $ 25,908
</TABLE>
(The accompanying notes to financial statements are an
integral part of this statement of cash flows.)
3
<PAGE>
TENNECO CREDIT CORPORATION
AND CONSOLIDATED SUBSIDIARIES
BALANCE SHEET
(UNAUDITED)
ASSETS
<TABLE>
<CAPTION>
(THOUSANDS)
JUNE 30, DECEMBER 31, JUNE 30,
1994 1993 1993
---------- ------------ ----------
<S> <C> <C> <C>
Notes and accounts receivable purchased from
affiliates:
Customers.................................. $1,832,828 $2,024,575 $2,170,723
Affiliated companies....................... 4,236 94,968 105,555
---------- ---------- ----------
1,837,064 2,119,543 2,276,278
Less--Unearned finance charges.............. 199,895 224,518 280,717
Allowance for doubtful receivables....... 10,743 34,863 42,323
---------- ---------- ----------
1,626,426 1,860,162 1,953,238
---------- ---------- ----------
Notes receivable:
Non-affiliated companies, including $4,917,
$8,067 and $8,632 due within one year at
the respective dates...................... 71,085 105,829 123,916
Affiliated companies....................... -- 110,085 98,160
---------- ---------- ----------
71,085 215,914 222,076
---------- ---------- ----------
Equipment under operating leases (at cost),
less accumulated depreciation of $17,251,
$16,257 and $15,263 at the respective
dates...................................... 52,355 53,349 54,342
---------- ---------- ----------
Other assets:
Cash ...................................... 18 4 5
Accounts receivable from affiliates........ 43,180 1,730 1,228
Interest receivable and other.............. 3,873 106,667 23,904
---------- ---------- ----------
47,071 108,401 25,137
---------- ---------- ----------
$1,796,937 $2,237,826 $2,254,793
========== ========== ==========
</TABLE>
(The accompanying notes to financial statements are an
integral part of this balance sheet.)
4
<PAGE>
TENNECO CREDIT CORPORATION
AND CONSOLIDATED SUBSIDIARIES
BALANCE SHEET
(UNAUDITED)
LIABILITIES AND STOCKHOLDER'S EQUITY
<TABLE>
<CAPTION>
(THOUSANDS EXCEPT SHARE AMOUNTS)
JUNE 30, DECEMBER 31, JUNE 30,
1994 1993 1993
---------- ------------ ----------
<S> <C> <C> <C>
Commercial paper............................ $ -- $ 240,938 $ 150,212
Senior notes, including $287,355, $503,322
and $116,500 due within one year at the
respective dates........................... 1,102,925 1,353,593 1,467,748
Subordinated notes.......................... 92,100 92,100 92,100
Accounts payable to affiliates.............. 30,038 4,449 24,163
Dealers' reserves........................... 14,733 18,148 15,471
Accrued interest............................ 34,816 43,625 45,318
Deferred income taxes....................... 12,345 1,171 7,821
---------- ---------- ----------
1,286,957 1,754,024 1,802,833
---------- ---------- ----------
Stockholder's equity:
Common stock, par value $5 per share, au-
thorized, issued and outstanding 200
shares.................................... 1 1 1
Capital surplus............................ 185,228 185,228 185,228
Retained earnings.......................... 324,751 298,573 266,731
---------- ---------- ----------
509,980 483,802 451,960
---------- ---------- ----------
$1,796,937 $2,237,826 $2,254,793
========== ========== ==========
</TABLE>
(The accompanying notes to financial statements are an
integral part of this balance sheet.)
5
<PAGE>
TENNECO CREDIT CORPORATION
AND CONSOLIDATED SUBSIDIARIES
STATEMENT OF CHANGES IN STOCKHOLDER'S EQUITY
(UNAUDITED)
<TABLE>
<CAPTION>
(THOUSANDS)
SIX MONTHS ENDED
JUNE 30,
-----------------
1994 1993
-------- --------
<S> <C> <C>
COMMON STOCK:
Balance beginning and end of period........................ $ 1 $ 1
-------- --------
CAPITAL SURPLUS:
Balance beginning and end of period........................ 185,228 185,228
-------- --------
RETAINED EARNINGS:
Balance beginning of period................................ 298,573 228,981
Net income................................................ 26,178 37,750
-------- --------
Balance end of period...................................... 324,751 266,731
-------- --------
Total..................................................... $509,980 $451,960
======== ========
</TABLE>
(The accompanying notes to financial statements are an
integral part of this statement of changes in stockholder's equity.)
6
<PAGE>
TENNECO CREDIT CORPORATION
AND CONSOLIDATED SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS
(UNAUDITED)
(1) In the opinion of Tenneco Credit Corporation, the accompanying unaudited
financial statements of Tenneco Credit Corporation and its consolidated
subsidiaries (the "Company") contain all adjustments (consisting of only
normal recurring accruals) necessary to present fairly the financial
position as of June 30, 1994, and the results of operations; changes in
stockholder's equity; and cash flows for the periods indicated.
(2) Certain reclassifications have been made to prior period amounts to conform
with the current period presentation.
(3) On April 26, 1994, Case Equipment Corporation, a newly organized
corporation formed to acquire the farm and construction equipment segment
(the "Case Business") of Tenneco Inc. and its consolidated subsidiaries
("Tenneco"), filed a registration statement with the Securities and
Exchange Commission to sell to the public shares of its common stock
through an initial public offering. On June 24, 1994, Case Equipment
Corporation was listed on the New York Stock Exchange following an initial
public offering of 20.1 million shares, or approximately 29 percent, of
Case Equipment Corporation's 70 million outstanding common shares. On July
1, 1994, Case Equipment Corporation changed its name to "Case Corporation."
In connection with the offering, Tenneco transferred all of its Case
Business assets to Case Equipment Corporation, except for $1.2 billion of
existing United States retail receivables, which were retained by Tenneco
Credit Corporation ("Tenneco Credit"). Case Equipment Corporation (now Case
Corporation) will service the retail receivables retained by Tenneco
Credit, for which Tenneco Credit will pay a servicing fee equal to two
percent per annum of the average amount outstanding during each month. It
is estimated that by 1997 substantially all of the farm and construction
equipment receivables retained by Tenneco Credit will be liquidated. As a
result of transactions described above, the future activities and income of
the Company will be substantially reduced.
(The above notes are an integral part of the foregoing financial statements.)
7
<PAGE>
TENNECO CREDIT CORPORATION
AND CONSOLIDATED SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS
SECOND QUARTER RESULTS
SIGNIFICANT EVENT
On April 26, 1994, Case Equipment Corporation, a newly organized corporation
formed to acquire the farm and construction equipment segment (the "Case
Business") of Tenneco Inc. and its consolidated subsidiaries ("Tenneco"), filed
a registration statement with the Securities and Exchange Commission to sell to
the public shares of its common stock through an initial public offering. On
June 24, 1994, Case Equipment Corporation was listed on the New York Stock
Exchange following an initial public offering of 20.1 million shares, or
approximately 29 percent, of Case Equipment Corporation's 70 million
outstanding common shares. On July 1, 1994, Case Equipment Corporation changed
its name to "Case Corporation."
In connection with the offering, Tenneco transferred all of its Case Business
assets to Case Equipment Corporation, except for $1.2 billion of existing
United States retail receivables, which were retained by Tenneco Credit
Corporation ("Tenneco Credit"). Case Equipment Corporation (now Case
Corporation) will service the retail receivables retained by Tenneco Credit,
for which Tenneco Credit will pay a servicing fee equal to two percent per
annum of the average amount outstanding during each month. It is estimated that
by 1997 substantially all of the farm and construction equipment receivables
retained by Tenneco Credit will be liquidated. As a result of transactions
described above, the future activities and income of Tenneco Credit Corporation
and its consolidated subsidiaries (the "Company") will be substantially
reduced. As used hereinafter, "Case" shall refer to "old" Case Corporation,
which was renamed Tenneco Equipment Corporation on July 1, 1994.
REVENUES
The Company reported total revenues of $44.9 million for the second quarter
of 1994, down $13.5 million from the second quarter of 1993. This reduction is
attributable to a decrease in Case retail notes receivable due to the sale of
$395 million, $439 million and $530 million net book value of certain retail
farm and construction equipment receivables to limited purpose business trusts,
which utilized the receivables as collateral for the issuance of asset-backed
securities to the public in May 1993, November 1993 and February 1994,
respectively. See "Other Income" for additional information. The following sets
forth the percentage of revenues from the various sources:
<TABLE>
<CAPTION>
REVENUES
---------------------
THREE MONTHS ENDED
JUNE 30,
------------------
1994 1993
--------- ---------
<S> <C> <C>
Case.............................................. 69% 82%
Pipeline.......................................... 9 7
Other............................................. 13 6
--------- ---------
Total from accounts receivable.................. 91 95
Rental............................................ 3 2
Notes receivable.................................. 6 3
--------- ---------
100% 100%
</TABLE>
The average yield on Case retail receivables for the second quarter of 1994
was 10.5% compared with 11.0% for the second quarter of 1993. The discount rate
charged on pipeline and other short-term receivables ranged from 6.50% to 7.50%
during the second quarter of 1994 versus 6.0% during the second quarter of
1993.
8
<PAGE>
The Company's only leasing activity is the multifuel boiler facility leased
to Packaging Corporation of America ("Packaging"), an affiliate of the Company.
Leasing activities provided $1.4 million of revenues in the three months ended
June 30, 1994 and 1993.
Under an Investment Agreement dated June 15, 1988, between the Company and
Tenneco Inc. (the "Investment Agreement"), the Company is to receive a service
charge from Tenneco Inc. for each month equal to the amount, if any, by which
the cumulative earnings of the Company for the period from the beginning of the
calendar year to the end of such month, before deduction of fixed charges and
federal income taxes, are less than 125% of the Company's fixed charges. A
service charge of $234,000 was paid by Tenneco Inc. for the month of January
1994. No service charge was required for the months prior to January 1994 nor
for February through June 1994.
EXPENSES
Interest expense totaled $31.6 million for the second quarter of 1994, a
decrease of $9.6 million or 23% over the second quarter of 1993. This decrease
resulted from lower levels of long-term and short-term debt. The average
interest rate for the second quarter of 1994 was 10.0% compared to 9.6% for the
second quarter of 1993. The higher average interest rates were due to the
maturity of low interest long-term debt. Operating and administrative expenses
decreased $2.5 million primarily due to the reversal of the allowance for bad
debt related to Case store receivables.
OTHER INCOME
Other income for the second quarter of 1994 was a loss of $0.6 million, down
from a gain of $24.0 million in the second quarter of 1993. The Company
recognized a loss of $0.6 million from the sale of trade receivables originated
by Tenneco's packaging, automotive and natural gas pipeline subsidiaries to
Asset Securitization Cooperative Corporation in the second quarter of 1994. In
the second quarter of 1993, the Company recognized a pre-tax gain of $23.0
million on the sale of certain farm and construction equipment receivables to a
limited purpose business trust, which utilized the receivables as collateral
for the issuance of asset-backed securities to the public. The receivables sold
to the trust had a net book value of $395 million.
NET INCOME
Net income for the second quarter of 1994 was $8.3 million, a decrease of
$15.3 million or 65% compared with the second quarter of 1993. The decrease is
primarily attributable to the sale of certain farm and construction equipment
receivables as discussed under "Other Income", partially offset by decreased
interest expense.
ASSETS
The Company had total assets of $1,796.9 million at June 30, 1994, as
compared to $2,237.8 million at December 31, 1993, and $2,254.8 million at June
30, 1993. The 20% reduction of total assets at June 30, 1994, versus June 30,
1993, was due primarily to the sale of $969 million net book value of certain
Case retail receivables to limited purpose business trusts, which utilized the
receivables as collateral for the issuance of asset-backed securities to the
public in November 1993 and February 1994. This decrease was partially offset
by additional acquisitions of Case retail notes receivable, and pipeline and
other accounts receivable and lower trade receivable sales to Asset
Securitization Cooperative Corporation.
As of June 30, 1994, the Company held net trade notes and accounts receivable
totaling $1,626.4 million, which accounted for 91% of the Company's total
assets. This compares to $1,860.2 million and $1,953.2 million or 83% and 87%
of total assets as of December 31, 1993 and June 30, 1993, respectively.
Details of these receivables are shown as follows:
<TABLE>
<CAPTION>
NET TRADE NOTES AND ACCOUNTS
RECEIVABLE
------------------------------
JUNE 30, DECEMBER 31, JUNE 30,
1994 1993 1993
-------- ------------ --------
<S> <C> <C> <C>
Case....................................... 62% 81% 87%
Pipeline................................... 15 13 8
Other...................................... 23 6 5
--- --- ---
100% 100% 100%
</TABLE>
9
<PAGE>
Case net trade notes and accounts receivable are $509.4 million and $697
million lower at June 30, 1994, compared to December 31, 1993 and June 30,
1993, respectively, due to the sale of certain retail farm and construction
equipment receivables to limited purpose business trusts.
The Company held $71.1 million of notes receivable from non-affiliated
companies at June 30, 1994, down from the $105.8 million and $123.9 million
held at December 31, 1993 and June 30, 1993, respectively. Long-term
receivables from non-affiliated companies represented 4% of the Company's total
assets at June 30, 1994.
As of June 30, 1994, the Company had $52.4 million invested in a multifuel
boiler leased to Packaging. The leased facility represented 3% of the Company's
total assets at June 30, 1994.
CAPITALIZATION AND CAPITAL RESOURCES
Pursuant to the Investment Agreement, Tenneco Inc. is required to maintain an
investment in the Company as necessary to assure that at all times the sum of
the Company's subordinated debt plus stockholder's equity will be at least
equal to 20% of the Company's total debt plus stockholder's equity.
The Company's capital requirements have been financed through the issuance of
commercial paper, publicly and privately placed medium-term notes, senior
public debt and bank loans, subordinated debt, and advances and equity capital
from Tenneco Inc., plus earnings retained in the business.
The Company's total capitalization was $1,705.0 million, $2,170.4 million and
$2,162.0 million at June 30, 1994, December 31, 1993 and June 30, 1993,
respectively. The components of capitalization at such dates are set forth in
the following table:
<TABLE>
<CAPTION>
CAPITALIZATION
------------------------------
JUNE 30, DECEMBER 31, JUNE 30,
1994 1993 1993
-------- ------------ --------
<S> <C> <C> <C>
Commercial paper........................... --% 11% 7%
Medium-term senior debt.................... 4 4 5
Long-term senior debt...................... 60 59 63
Subordinated debt.......................... 6 4 4
Stockholder's equity....................... 30 22 21
--- --- ---
100% 100% 100%
</TABLE>
SIX MONTH RESULTS
REVENUES
For the six months of 1994, revenue totaled $86.0 million, down 30% from the
$122.8 million reported for the same period in 1993. This reduction is
attributable to lower average Case receivable balances. The decrease in Case
retail notes is due to the sale of $395 million, $439 million and $530 million
net book value of certain retail farm and construction equipment receivables to
limited purpose business trusts, which issued asset-backed securities to the
public in May 1993, November 1993 and February 1994, respectively.
On a percentage basis, revenues for the six-month period were generated from
the following:
<TABLE>
<CAPTION>
REVENUES
-------------------
SIX MONTHS ENDED
JUNE 30,
-------------------
1994 1993
-------- --------
<S> <C> <C>
Case................................................ 72% 83%
Pipeline............................................ 10 7
Other............................................... 11 5
-------- --------
Total from accounts receivable.................... 93 95
Rental.............................................. 3 2
Notes receivable.................................... 4 3
-------- --------
100% 100%
</TABLE>
10
<PAGE>
Discount rates on short-term accounts receivable during the first six months
of 1994 ranged from 5.75% to 7.5% as compared to a range of 6.0% to 6.5% for
the first six months of 1993. The average yield on Case retail receivables for
the six month period decreased to 9.8% in 1994 from 11.5% in 1993.
EXPENSES
Interest expense for the six months ended June 30, 1994, was $67.4 million
versus $83.2 million for the same period in 1993. The $15.8 million decrease
was due to lower levels of long-term and short-term debt for the first six
months of 1994. Operating and administrative expense decreased $2.5 million as
discussed in "Second Quarter Results--Expenses."
OTHER INCOME
Other income for the six months ended June 30, 1994, was $25.5 million versus
$25.9 million for the same period in 1993. Other income was primarily
attributable to the pre-tax gain on the sale of certain farm and construction
equipment receivables to limited purpose business trusts in May 1993 and
February 1994. See discussion in "Other Income" under Second Quarter Results.
NET INCOME
Net income for the first six months of 1994 was $26.2 million, a decrease of
$11.6 million from net income of $37.8 million for the 1993 period. This
reduction was primarily due to lower Case revenues, partially offset by
decreased interest expense.
PART II--OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
(a) Exhibits.
12--Computation of Ratio of Earnings to Fixed Charges.
(b) Reports on Form 8-K. Tenneco Credit Corporation did not file any reports
on Form 8-K during the quarter ended June 30, 1994.
11
<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 thereunto duly authorized.
TENNECO CREDIT CORPORATION
Robert T. Blakely
Date: August 12, 1994 By __________________________________
Robert T. Blakely
President
E. J. Milan
Date: August 12, 1994 By __________________________________
E. J. Milan
Principal Financial and Accounting
Officer
12
<PAGE>
EXHIBIT 12
TENNECO CREDIT CORPORATION
AND CONSOLIDATED SUBSIDIARIES
COMPUTATION OF RATIO OF EARNINGS
TO FIXED CHARGES
(UNAUDITED)
<TABLE>
<CAPTION>
(THOUSANDS)
SIX MONTHS ENDED
JUNE 30,
-----------------
1994 1993
-------- --------
<S> <C> <C>
Net income................................................... $ 26,178 $ 37,750
Add:
Interest expense............................................ 67,388 83,236
Income taxes................................................ 17,787 25,033
-------- --------
Earnings as defined....................................... $111,353 $146,019
======== ========
Fixed charges--interest expense.............................. $ 67,388 $ 83,236
======== ========
Ratio of earnings to fixed charges........................... 1.65 1.75
======== ========
</TABLE>
<PAGE>
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
SEQUENTIALLY
EXHIBIT NUMBERED
NUMBER DESCRIPTION OF EXHIBIT PAGES
------- ---------------------- ------------
<C> <S>
12 --Computation of Ratio of Earnings to Fixed Charges.
</TABLE>
<PAGE>
EXHIBIT 12
TENNECO CREDIT CORPORATION
AND CONSOLIDATED SUBSIDIARIES
COMPUTATION OF RATIO OF EARNINGS
TO FIXED CHARGES
(UNAUDITED)
<TABLE>
<CAPTION>
(THOUSANDS)
SIX MONTHS ENDED
JUNE 30,
-----------------
1994 1993
-------- --------
<S> <C> <C>
Net income................................................... $ 26,178 $ 37,750
Add:
Interest expense............................................ 67,388 83,236
Income taxes................................................ 17,787 25,033
-------- --------
Earnings as defined....................................... $111,353 $146,019
======== ========
Fixed charges--interest expense.............................. $ 67,388 $ 83,236
======== ========
Ratio of earnings to fixed charges........................... 1.65 1.75
======== ========
</TABLE>
