<PAGE>1
Page 1 of 16 Pages
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For Quarterly Period Ended June 30, 1998
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For Transition Period from to
----------------- -----------------
Commission File Number 1-12658
ALBEMARLE CORPORATION
-----------------------
(Exact name of registrant as specified in its charter)
VIRGINIA 54-1692118
- -------------------------- --------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
330 SOUTH FOURTH STREET
P. O. BOX 1335
RICHMOND, VIRGINIA 23210
- --------------------------- ---------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code - (804) 788-6000
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
---- ----
Number of shares of common stock, $.01 par value, outstanding as
of June 30, 1998: 52,797,116
<PAGE>2
ALBEMARLE CORPORATION
I N D E X
Page
Number
---------
PART I. FINANCIAL INFORMATION
ITEM 1. Financial Statements
Consolidated Balance Sheets - June 30, 1998
and December 31, 1997 3-4
Consolidated Statements of Income - Three and
Six Months Ended June 30, 1998 and 1997 5
Consolidated Statements of Comprehensive Income
- Three and Six Months Ended June 30, 1998
and 1997 6
Condensed Consolidated Statements of Cash Flows -
Six Months Ended June 30, 1998 and 1997 7
Notes to the Consolidated Financial Statements 8-10
ITEM 2. Management's Discussion and Analysis of Results
of Operations and Financial Condition and Outlook 11-15
PART II. OTHER INFORMATION
ITEM 1. Legal Proceedings 15
ITEM 6. Exhibits and Reports on Form 8-K 15
SIGNATURES 16
<PAGE>3
PART I - FINANCIAL INFORMATION
- ------------------------------
ITEM 1. Financial Statements
--------------------
<TABLE>
ALBEMARLE CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
---------------------------
(Dollars In Thousands)
----------------------
<CAPTION>
June 30, December 31,
1998 1997
---------------- ------------------
(Unaudited)
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents $ 43,091 $ 34,322
Accounts receivable, less allowance
for doubtful accounts (1998
- $2,612; 1997 - $2,449) 132,499 154,421
Inventories:
Finished goods 81,553 65,998
Raw materials 10,873 7,424
Stores, supplies and other 16,881 16,861
---------------- ------------------
109,307 90,283
Deferred income taxes and prepaid
expenses 18,227 17,710
---------------- ------------------
Total current assets 303,124 296,736
---------------- ------------------
Property, plant and equipment,
at cost 1,214,345 1,188,252
Less accumulated depreciation and
amortization 718,417 691,612
---------------- ------------------
Net property, plant and
equipment 495,928 496,640
Other assets and deferred charges 84,147 77,204
Goodwill and other intangibles, net of
amortization 16,502 17,601
---------------- ------------------
Total assets $ 899,701 $ 888,181
---------------- ------------------
---------------- ------------------
<FN>
See accompanying notes to the consolidated financial statements.
</TABLE>
<PAGE>4
<TABLE>
ALBEMARLE CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
----------------------------
(Dollars In Thousands)
----------------------
<CAPTION>
June 30, December 31,
1998 1997
---------------- ------------------
(Unaudited)
<S> <C> <C>
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 48,527 $ 50,668
Long-term debt, current portion 380 379
Accrued expenses 53,418 47,578
Dividends payable 4,781 4,952
Income taxes payable 12,537 8,983
--------------- ------------------
Total current liabilities 119,643 112,560
--------------- ------------------
Long-term debt 83,027 91,414
Other noncurrent liabilities 72,903 69,704
Deferred income taxes 99,008 97,167
Shareholders' equity:
Common stock, $.01 par value,
issued - 52,797,116 in 1998
and 53,886,802 in 1997,
respectively 528 539
Additional paid-in capital 192,415 218,841
Accumulated other comprehensive
income (loss) (2,111) (1,445)
Retained earnings 334,288 299,401
--------------- ------------------
Total shareholders' equity 525,120 517,336
--------------- ------------------
Total liabilities and shareholders'
equity $ 899,701 $ 888,181
--------------- ------------------
--------------- ------------------
<FN>
See accompanying notes to the consolidated financial statements.
</TABLE>
<PAGE>5
<TABLE>
ALBEMARLE CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
---------------------------------
(In Thousands Except Per-Share Amounts)
---------------------------------------
(Unaudited)
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
------------------------- ------------------------
1998 1997 1998 1997
------------ ------------ ----------- ------------
<S> <C> <C> <C> <C>
Net sales $204,103 $207,675 $419,252 $406,069
Cost of goods sold 137,925 139,866 285,253 271,898
------------ ------------ ----------- ------------
Gross profit 66,178 67,809 133,999 134,171
Selling, general and
administrative expenses 27,089 27,669 53,664 54,268
Research and development
expenses 6,889 7,828 13,943 15,225
------------ ------------ ----------- ------------
Operating profit 32,200 32,312 66,392 64,678
Interest and financing
expenses 755 210 1,707 407
Other income, net (516) (459) (1,182) (521)
------------ ------------ ----------- ------------
Income before income
taxes 31,961 32,561 65,867 64,792
Income taxes 10,150 12,198 21,407 24,252
------------ ------------ ----------- ------------
NET INCOME $ 21,811 $ 20,363 $ 44,460 $ 40,540
------------ ------------ ----------- ------------
------------ ------------ ----------- ------------
BASIC EARNINGS PER
SHARE $ .41 $ .37 $ .83 $ .74
------------ ------------ ----------- ------------
------------ ------------ ----------- ------------
Shares used to compute
basic earnings per share 53,069 55,204 53,269 55,125
------------ ------------ ----------- ------------
------------ ------------ ----------- ------------
DILUTED EARNINGS PER
SHARE $ .41 $ .37 $ .83 $ .73
------------ ------------ ----------- ------------
------------ ------------ ----------- ------------
Shares used to compute
diluted earnings per
share 53,681 55,599 53,831 55,567
------------ ------------ ----------- ------------
------------ ------------ ----------- ------------
Cash dividends declared
per share of common
stock $ .09 $ .07 $ .18 $ .14
------------ ------------ ----------- ------------
------------ ------------ ----------- ------------
<FN>
See accompanying notes to the consolidated financial statements.
</TABLE>
<PAGE>6
<TABLE>
ALBEMARLE CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
-----------------------------------------------
(Dollars In Thousands)
----------------------
(Unaudited)
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
------------------------- ------------------------
1998 1997 1998 1997
------------ ------------ ----------- ------------
<S> <C> <C> <C> <C>
Net income $ 21,811 $ 20,363 $ 44,460 $ 40,540
Other comprehensive
income, net of tax:
Foreign currency
translation
adjustments 1,310 (2,190) (666) (13,482)
------------ ------------ ----------- ------------
Comprehensive income $ 23,121 $ 18,173 $ 43,794 $ 27,058
------------ ------------ ----------- ------------
------------ ------------ ----------- ------------
<FN>
See accompanying notes to the consolidated financial statements.
</TABLE>
<PAGE>7
<TABLE>
ALBEMARLE CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
-----------------------------------------------
(Dollars In Thousands)
----------------------
(Unaudited)
<CAPTION>
Six Months Ended
June 30,
--------------------------
1998 1997
------------- ------------
<S> <C> <C>
CASH AND CASH EQUIVALENTS AT BEGINNING OF
YEAR $34,322 $14,242
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income 44,460 40,540
Adjustments to reconcile net income to
cash flows from operating activities:
Depreciation and amortization 36,243 33,607
Working capital decrease (increase)
excluding cash and cash equivalents 8,699 (33,746)
Other, net (2,091) (1,040)
-------------- ------------
Net cash provided from operating
activities 87,311 39,361
-------------- ------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures and acquisition
costs (35,761) (52,301)
Other, net 461 809
-------------- ------------
Net cash used in investing
activities (35,300) (51,492)
-------------- ------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Purchases of common stock (26,698) --
Repayments of long-term debt (10,926) (9,466)
Dividends paid (9,744) (7,706)
Proceeds from borrowings 3,865 15,955
Proceeds from exercise of stock options 261 2,964
------------- ------------
Net cash (used in) provided from
financing activities (43,242) 1,747
------------- ------------
Increase (decrease) in cash and cash
equivalents 8,769 (10,384)
------------- ------------
CASH AND CASH EQUIVALENTS AT END OF PERIOD $43,091 $3,858
------------- ------------
------------- ------------
<FN>
See accompanying notes to the consolidated financial statements.
</TABLE>
<PAGE>8
ALBEMARLE CORPORATION AND SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
----------------------------------------------
(In Thousands Except Per-Share Amounts)
(Unaudited)
1. In the opinion of management, the accompanying consolidated
financial statements of Albemarle Corporation and
Subsidiaries ("Albemarle" or "the Company") contain all
adjustments necessary to present fairly, in all material
respects, the Company's consolidated financial position as of
June 30, 1998 and December 31, 1997, the consolidated results
of operations and comprehensive income for the three- and
six-month periods ended June 30, 1998 and June 30, 1997, and
condensed consolidated cash flows for the six-month periods
ended June 30, 1998 and June 30, 1997. All adjustments are of
a normal and recurring nature. These consolidated financial
statements should be read in conjunction with the
consolidated financial statements and notes thereto included
in the Company's 1997 Annual Report & Form 10-K filed on
March 20, 1998. The December 31, 1997 consolidated balance
sheet data was derived from audited financial statements, but
does not include all disclosures required by generally
accepted accounting principles. The results of operations for
the three- and six-month periods ended June 30, 1998, are not
necessarily indicative of the results to be expected for the
full year. Certain amounts in the accompanying consolidated
financial statements and notes thereto for the period ended
June 30, 1998, have been compiled and included herein in
connection with the adoption of Financial Accounting
Standards Board ("FASB") Statement of Financial Accounting
Standards ("SFAS") No. 130 "Reporting Comprehensive Income"
effective January 1, 1998.
2. Long-term debt consists of the following:
<TABLE>
<CAPTION>
June 30, December 31,
1998 1997
--------------- ---------------
<S> <C> <C>
Variable-rate bank loans $ 66,100 $ 77,000
Foreign borrowings 16,185 13,645
Miscellaneous 1,122 1,148
--------------- ---------------
Total 83,407 91,793
--------------- ---------------
Less amounts due within one
year 380 379
--------------- ---------------
Long-term debt $ 83,027 $ 91,414
--------------- ---------------
--------------- ---------------
</TABLE>
<PAGE>9
ALBEMARLE CORPORATION AND SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
----------------------------------------------
(In Thousands Except Per-Share Amounts)
(Unaudited)
3. Basic and diluted earnings per share for the three- and six-month
periods ended June 30, 1998 and 1997, are calculated as
follows:
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30 June 30
--------------------- ----------------------
BASIC EARNINGS PER SHARE 1998 1997 1998 1997
---------- ----------- --------- ------------
<S> <C> <C> <C> <C>
Numerator:
Income available to
stockholders, as
reported $21,811 $20,363 $44,460 $40,540
---------- ----------- --------- ------------
Denominator:
Average number of
shares of common
stock outstanding 53,069 55,204 53,269 55,125
---------- ----------- --------- ------------
Basic earnings per
share $ .41 $ .37 $ .83 $ .74
---------- ----------- --------- ------------
---------- ----------- --------- ------------
DILUTED EARNINGS PER SHARE
Numerator:
Income available to
stockholders, as
reported $21,811 $20,363 $44,460 $40,540
---------- ---------- ---------- ------------
Denominator:
Average number of
shares of common
stock outstanding 53,069 55,204 53,269 55,125
Shares issuable upon
exercise of stock
options 612 395 562 442
---------- ---------- ---------- ------------
Total shares 53,681 55,599 53,831 55,567
---------- ---------- ---------- ------------
Diluted earnings
per share $ .41 $ .37 $ .83 $ .73
---------- ---------- ---------- ------------
---------- ---------- ---------- ------------
</TABLE>
<PAGE>10
ALBEMARLE CORPORATION AND SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
----------------------------------------------
(In Thousands Except Share Amounts)
(Unaudited)
4. In June, 1997, the FASB issued SFAS No. 131, "Disclosures
about Segments of an Enterprise and Related Information",
which became effective for fiscal years beginning after
December 31, 1997. SFAS No. 131 establishes standards for
reporting information about operating segments, including
related disclosures about products and services, geographic
areas, and major customers. Interim reporting disclosures
are not required in the first year of adoption and are
therefore not provided.
In June, 1998, the FASB issued SFAS No. 133, "Accounting for
Derivative Instruments and Hedging Activities". SFAS No. 133
establishes accounting and reporting standards for derivative
instruments, including certain derivative instruments
embedded in other contracts, and for hedging activities. It
requires that an entity recognize all derivatives as either
assets or liabilities in the statement of financial position
and measure those instruments at fair value. This Statement
is effective for all fiscal quarters beginning after June 15,
1999, however, early adoption is permitted.
The Company has not determined the impact SFAS Nos. 131 and
133 will have on the Company's financial statements; however,
at the time of adoption, these Statements are not expected to
have a material impact on the financial position or results
of operations of the Company.
<PAGE>11
ITEM 2. Management's Discussion and Analysis of Results of
Operations and Financial Condition
--------------------------------------------------
The following is management's discussion and analysis of certain
significant factors affecting Albemarle Corporation's ("Albemarle"
or "the Company") results of operations during the periods included
in the accompanying consolidated statements of income and changes
in the Company's financial condition since December 31, 1997.
Some of the information presented in the following discussion
constitutes forward-looking comments within the meaning of the
Private Securities Litigation Reform Act of 1995. Although the
Company believes its expectations are based on reasonable
assumptions within the bounds of its knowledge of its business and
operations, there can be no assurance that actual results will not
differ materially from its expectations. Factors which could cause
actual results to differ from expectations include, without
limitation, the timing of orders received from customers, the gain
or loss of significant customers, competition from other
manufacturers, changes in the demand for the Company's products,
increases in the cost of the product, changes in the market in
general, fluctuations in foreign currencies and significant changes
in new product introduction resulting in an increase in capital
project requests and approvals leading to additional capital
spending.
Results of Operations
- ---------------------
Second Quarter 1998 Compared with Second Quarter 1997
- ------------------------------------------------------
NET SALES
Net sales for the second quarter of 1998 amounted to $204.1
million, down approximately two percent from second quarter 1997
net sales of $207.7 million. The decrease in net sales was
primarily due to lower shipments of flame retardants, zeolites,
European potassium and chlorine chemicals, and bromine and
derivatives, as well as the unfavorable effects of foreign exchange
primarily in Japan, partly offset by increased shipments of polymer
additives and intermediates, organometallics and catalysts,
agrichemicals and ibuprofen.
OPERATING COSTS AND EXPENSES
Cost of goods sold for the second quarter of 1998 amounted to
$137.9 million, which was down approximately one percent from the
1997 second quarter. The gross profit margin decreased to 32.4% in
1998 from 32.7% for the corresponding period in 1997. The slight
decline in the gross margin from second quarter 1997 reflects the
unfavorable effects of foreign exchange and lower shipments in 1998
versus 1997, offset in part by lower raw material costs and
improved plant utilizations in certain product lines in the 1998
period.
Selling, general and administrative expenses, combined with
research and development expenses, decreased four percent in the
second quarter of 1998 versus second quarter 1997. As a
percentage of net sales, selling, general and administrative
expenses, including research and development expenses, were 16.6%
in 1998 versus 17.1% in the 1997 quarter.
<PAGE>12
OPERATING PROFIT
Operating profit in the second quarter of 1998 was approximately
equal to the corresponding period in 1997, while the operating
profit margin increased slightly to 15.8% in 1998 from 15.6% in the
1997 period.
INTEREST AND FINANCING EXPENSES
Interest and financing expenses for the second quarter of 1998 were
$.5 million higher compared to the corresponding second quarter of
1997 due to higher average outstanding debt.
INCOME TAXES
Income taxes for the second quarter of 1998 decreased approximately
$2.0 million compared to the second quarter of 1997 as the
effective income tax rate declined to 31.8% in the 1998 quarter
from 37.5% in the 1997 quarter. The higher tax rate in second
quarter 1997 does not reflect the benefit of tax planning
strategies and improved earnings in certain foreign subsidiaries in
the latter half of 1997 which resulted in a 1997 annual effective
income tax rate of 33.8%.
Results of Operations
- ---------------------
Six Months 1998 Compared with Six Months 1997
- ---------------------------------------------
NET SALES
Net sales for the first six months of 1998 amounted to $419.3
million, an increase of $13.2 million or three percent from the
corresponding period of 1997. The higher net sales were primarily
due to increased shipments of pharmachemicals, special
intermediates and organometallics and catalysts, offset in part by
decreased shipments of zeolites, European potassium and chlorine
chemicals, and bromine and derivatives as well as the unfavorable
effects of foreign exchange primarily in Japan.
OPERATING COSTS AND EXPENSES
Cost of goods sold increased five percent or $13.4 million for the
first six months of 1998 from the corresponding period in 1997,
with the result that the gross profit margin decreased to 32.0% in
1998 from 33.0% in the 1997 period.
Selling, general and administrative expenses, combined with
research and development expenses, decreased three percent for the
first six months of 1998 versus the corresponding period in 1997.
As a percentage of net sales, selling, general and administrative
expenses, including research and development expenses, were 16.1%
in 1998 versus 17.1% in the 1997 period.
OPERATING PROFIT
Operating profit in the first six months of 1998 increased
approximately three percent from the corresponding period in 1997
due primarily to lower raw materials costs, improved plant
utilizations in certain product lines and the Company's cost
reduction program. The 1998 period also benefited from favorable
product mix in agrichemicals, offset in part by the unfavorable
effects of foreign exchange.
<PAGE>13
INTEREST AND FINANCING EXPENSES AND OTHER INCOME
Interest and financing expenses for the first six months of 1998
were $1.3 million higher compared to the corresponding period in
1997 due to higher average outstanding debt. Other income
increased $0.7 million due to higher interest income in the 1998
period.
INCOME TAXES
Income taxes in the first six months of 1998 decreased $2.8 million
from the 1997 period, reflecting a lower effective income tax rate
(32.5% in 1998 versus 37.4% in 1997). The higher tax rate in 1997
does not reflect the benefit of tax planning strategies and
improved earnings in certain foreign subsidiaries in the latter
half of 1997 which resulted in a 1997 annual effective income tax
rate of 33.8%.
Financial Condition and Liquidity
- ---------------------------------
Cash and cash equivalents at June 30, 1998, were $43.1 million,
representing an increase of $8.8 million from $34.3 million at
year-end 1997.
Cash flows provided from operating activities for the first six
months of 1998 together with borrowings of $3.9 million were used
to cover purchases of common stock, capital expenditures, repayment
of debt, payment of dividends with the balance added to cash and
cash equivalents.
The Company anticipates that cash provided from operations in the
future will be sufficient to pay its operating expenses, satisfy
debt-service obligations and make dividend payments.
The change in the Company's accumulated other comprehensive income
account from December 31, 1997, was due to foreign currency
translation adjustments primarily related to the strengthening of
the U.S. dollar, net of deferred income taxes.
The noncurrent portion of the Company's long-term debt amounted to
$83.0 million at June 30, 1998, compared to $91.4 million at the
end of 1997. The Company's long-term debt, including the current
portion, as a percentage of total capitalization amounted to 13.7%
at June 30, 1998.
The Company's capital expenditures in the first six months of 1998
were lower than the same period of 1997. For the year however,
capital expenditures are forecasted to be about the same as the
1997 level. Capital spending will be financed primarily with cash
flow from operations with any additional cash provided from
additional debt. The amount and timing of any additional borrowing
will depend on the Company's specific cash requirements.
The Company is subject to federal, state, local and foreign
requirements regulating the handling, manufacture and use of
materials (some of which may be classified as hazardous or toxic by
one or more regulatory agencies), the discharge of materials into
the environment and the protection of the environment. To the best
of the Company's knowledge, it currently is complying with and
expects to continue to comply in all material respects with
existing environmental laws, regulations, statutes and ordinances. Such
<PAGE>14
compliance with federal, state, local and foreign
environmental protection laws has not in the past had, and is not
expected to have in the future, a material effect on earnings or
the competitive position of Albemarle.
Among other environmental requirements, the Company is subject to
the federal Superfund law, and similar state laws, under which the
Company may be designated as a potentially responsible party and
may be liable for a share of the costs associated with cleaning up
various hazardous waste sites.
Outlook
- -------
The strengthening of the U.S. dollar against other currencies,
particularly the Japanese yen, affected the Company's results
unfavorably during the second quarter of 1998. The Company
believes this trend likely will continue through the end of 1998.
For the overall business, the Company expects revenue growth at
only a single-digit percentage increase in 1998 compared to 1997
limited by the effects of foreign currency and Asian economic
issues.
Generally, strong demand in Europe and the United States for
electronic products will continue to drive demand for the Company's
Polymer Chemicals business unit products. In a few of these
products, there is evidence that sales volumes have been
unfavorably affected by diminished demand, and one non-proprietary
flame retardant is unlikely to post volume increases in 1998 over
1997, partly as a result of the Asian economic situation.
Organometallics and catalysts continue to perform well within
Polymer Chemicals, with the Company's new metallocene-based
catalysts and other co-catalysts beginning to be used in polymer
production at key customers. Growth of this new product area will
be dictated by the Company's success in supporting innovation by
its customers and the pace of growth of the overall market for
these improved polymers.
The Company has conducted a plant startup in Polymer Chemicals for
Ethacure <TM> 300 curative, used in cast polyurethane elastomers and
other applications, and expects this product will begin a more
active sales period following the withdrawal of the U.S.
Environmental Protection Agency's Significant New Use Requirement,
expected to take place in the third quarter of 1998. This will
allow customers to use this product in some cases to replace
another curative that is labeled as a suspected human carcinogen.
Ibuprofen sales continue to climb on the strength of successful
marketing efforts by our customers, including a number of
additional formulations for use by children and other users. This
should lead to improved overall performance in Pharmachemicals for
the year 1998 over 1997. The Company expects that Naproxen, a
pharmaceutical bulk active used in analgesic preparations, will
continue to lag expectations for the year, and likely will not
achieve the $10 million in annual sales earlier projected.
Cost reductions are an important focus for the Company. The
Company expects to achieve over $20 million of reductions in 1998
as a part of its $50 million manufacturing cost
<PAGE>15
reduction program. Cost reductions in general services and
administration expenses are also a continuing focus for the Company.
Part II - OTHER INFORMATION
- ---------------------------
Item 3. Legal Proceedings
-----------------
The Company and its subsidiaries are involved from time to time in
legal proceedings of types regarded as common in the Company's
businesses, particularly products liability and toxic tort
litigation and administrative or judicial proceedings seeking
remediation under environmental laws, such as Superfund.
While it is not possible to predict or determine the outcome of the
proceedings presently pending, in the Company's opinion they should
not result ultimately in liabilities that are likely to have a
material adverse effect upon the results of operations or financial
condition of the Company or its subsidiaries on a consolidated
basis, but could have a material adverse effect in a particular
reporting period.
Item 6. Exhibits and Reports on Form 8-K
--------------------------------
(a) Exhibits
27. Financial Data Schedule
(b) No reports on Form 8-K have been filed during the
quarter for which this report is filed.
<PAGE>16
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.
ALBEMARLE CORPORATION
----------------------
(Registrant)
Date: July 31, 1998 By: s/ Charles B. Walker
---------------------
Charles B. Walker
Vice Chairman and
Chief Financial Officer
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE
CONSOLIDATED BALANCE SHEET AND THE CONSOLIDATED STATEMENT OF INCOME
FILED AS PART OF THE QUARTERLY REPORT ON FORM 10-Q AND IS QUALIFIED
IN ITS ENTIRETY BY SUCH QUARTERLY REPORT ON FORM 10-Q.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-END> JUN-30-1998
<CASH> $43,091
<SECURITIES> $0
<RECEIVABLES> $135,111
<ALLOWANCES> $2,612
<INVENTORY> $109,307
<CURRENT-ASSETS> $303,124
<PP&E> $1,214,345
<DEPRECIATION> $718,417
<TOTAL-ASSETS> $899,701
<CURRENT-LIABILITIES> $119,643
<BONDS> $0
$0
$0
<COMMON> $528
<OTHER-SE> $524,592
<TOTAL-LIABILITY-AND-EQUITY> $899,701
<SALES> $419,252
<TOTAL-REVENUES> $419,252
<CGS> $285,253
<TOTAL-COSTS> $352,860
<OTHER-EXPENSES> $0
<LOSS-PROVISION> $0
<INTEREST-EXPENSE> $1,707
<INCOME-PRETAX> $65,867
<INCOME-TAX> $21,407
<INCOME-CONTINUING> $44,460
<DISCONTINUED> $0
<EXTRAORDINARY> $0
<CHANGES> $0
<NET-INCOME> $44,460
<EPS-PRIMARY> $0.83
<EPS-DILUTED> $0.83
</TABLE>
