===============================================================================
United States
Securities and Exchange Commission
Washington, D.C. 20549
Form 10-Q
________
Quarterly Report Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
For the quarterly period ended March 31, 1995 Commission file number 1-27
Texaco Inc.
(Exact name of the registrant as specified in its charter)
Delaware 74-1383447
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
2000 Westchester Avenue
White Plains, New York 10650
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (914) 253-4000
________
Texaco Inc. (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,
and (2) has been subject to such filing requirements for the past 90 days.
As of April 28, 1995, there were outstanding 259,732,953 shares of Texaco
Inc. Common Stock - par value $6.25.
===============================================================================
<PAGE>
<TABLE>
<CAPTION>
PART I - FINANCIAL INFORMATION
TEXACO INC. AND SUBSIDIARY COMPANIES
STATEMENT OF CONSOLIDATED INCOME
FOR THE THREE MONTHS ENDED March 31, 1995 AND 1994
--------------------------------------------------
(Millions of dollars, except per share amounts)
(Unaudited)
--------------------
For the three months
ended March 31,
--------------------
1995 1994
<S> <C> <C>
REVENUES
Sales and services $8,585 $7,232
Equity in income of affiliates, income from
dividends, interest, asset sales and other 474 202
------- -------
9,059 7,434
------- -------
DEDUCTIONS
Purchases and other costs 6,526 5,183
Operating expenses 745 731
Selling, general and administrative expenses 357 391
Maintenance and repairs 89 90
Exploratory expenses 55 66
Depreciation, depletion and amortization 568 408
Interest expense 124 122
Taxes other than income taxes 124 125
Minority interest 17 11
------- -------
8,605 7,127
------- -------
Income from continuing operations
before income taxes 454 307
Provision for income taxes 153 105
------- -------
Net income from continuing operations 301 202
Discontinued operations - -
------- -------
NET INCOME $ 301 $ 202
======= =======
Preferred stock dividend requirements $ 16 $ 24
------- -------
Net income available for common stock $ 285 $ 178
======= =======
Per common share (dollars)
Net income
Continuing operations $ 1.10 $ .69
Discontinued operations - -
------- -------
Net income $ 1.10 $ .69
======= =======
Cash dividends paid $ .80 $ .80
Average number of common shares
outstanding (thousands) 259,623 259,185
<FN>
See accompanying notes to consolidated financial statements.
</TABLE>
- 1 -
<PAGE>
<TABLE>
<CAPTION>
TEXACO INC. AND SUBSIDIARY COMPANIES
CONSOLIDATED BALANCE SHEET
AS OF MARCH 31, 1995 AND DECEMBER 31, 1994
------------------------------------------
(Millions of dollars)
March 31, December 31,
1995 1994
----------- ------------
(Unaudited)
-----------
<S> <C> <C>
ASSETS
Current Assets
Cash and cash equivalents $ 391 $ 404
Short-term investments - at fair value 30 60
Accounts and notes receivable, less allowance for doubtful
accounts of $24 million in 1995 and $25 million in 1994 3,207 3,297
Inventories 1,420 1,358
Assets under agreements for sale - 488
Net assets of discontinued operations 195 195
Deferred income taxes and other current assets 304 217
------- -------
Total current assets 5,547 6,019
Investments and Advances 5,698 5,336
Properties, Plant and Equipment - at cost 31,143 31,095
Less - Accumulated depreciation, depletion and amortization 18,008 17,612
------- -------
Net properties, plant and equipment 13,135 13,483
Deferred Charges 607 667
------- -------
Total $24,987 $25,505
======= =======
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Notes payable, commercial paper and
current portion of long-term debt $ 469 $ 917
Accounts payable and accrued liabilities 3,141 3,297
Estimated income and other taxes 808 801
------- -------
Total current liabilities 4,418 5,015
Long-Term Debt and Capital Lease Obligations 5,645 5,564
Deferred Income Taxes 838 879
Employee Retirement Benefits 1,083 1,130
Deferred Credits and Other Noncurrent Liabilities 2,477 2,558
Minority Interest in Subsidiary Companies 606 610
------- -------
Total 15,067 15,756
Stockholders' Equity
Market Auction Preferred Shares 300 300
ESOP Convertible Preferred Stock 509 515
Unearned employee compensation (279) (282)
Common stock - par value $6.25:
Shares authorized - 350,000,000
Shares issued - 274,293,417 in 1995 and 1994,
including treasury stock 1,714 1,714
Paid-in capital in excess of par value 655 654
Retained earnings 7,552 7,463
Currency translation adjustment 179 87
Unrealized net gain on investments 35 51
------- -------
10,665 10,502
Less - Common stock held in treasury, at cost -
14,608,489 shares in 1995 and
14,761,296 shares in 1994 745 753
------- -------
Total stockholders' equity 9,920 9,749
------- -------
Total $24,987 $25,505
======= =======
<FN>
See accompanying notes to consolidated financial statements.
</TABLE>
- 2 -
<PAGE>
<TABLE>
<CAPTION>
TEXACO INC. AND SUBSIDIARY COMPANIES
CONDENSED STATEMENT OF CONSOLIDATED CASH FLOWS
FOR THE THREE MONTHS ENDED MARCH 31, 1995 AND 1994
--------------------------------------------------
(Millions of dollars)
(Unaudited)
--------------------
For the three months
ended March 31,
--------------------
1995 1994
---- ----
<S> <C> <C>
OPERATING ACTIVITIES
Net income $301 $202
Reconciliation to net cash provided by (used in)
operating activities
Depreciation, depletion and amortization 568 408
Deferred income taxes 5 31
Exploratory expenses 55 66
Minority interest in net income 17 11
Dividends from affiliates, less than equity
in income (114) (45)
Gains on asset sales (201) (19)
Changes in operating working capital (244) (145)
Other - net (26) (46)
---- ----
Net cash provided by operating activities 361 463
INVESTING ACTIVITIES
Capital and exploratory expenditures (440) (545)
Proceeds from sales of assets 602 43
Purchases of investment instruments (168) (295)
Sales/maturities of investment instruments 222 315
Other - net 4 3
---- ----
Net cash provided by (used in) investing activities 220 (479)
FINANCING ACTIVITIES
Borrowings having original terms in excess
of three months
Proceeds 54 9
Repayments (32) (21)
Net increase (decrease) in other borrowings (384) 172
Dividends paid to the company's stockholders
Common (208) (207)
Preferred (6) (14)
Dividends paid to minority shareholders (20) (8)
---- ----
Net cash used in financing activities (596) (69)
EFFECT OF EXCHANGE RATE CHANGES ON CASH AND
CASH EQUIVALENTS 2 -
---- ----
DECREASE IN CASH AND CASH EQUIVALENTS (13) (85)
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR 404 488
---- ----
CASH AND CASH EQUIVALENTS AT END OF PERIOD $391 $403
==== ====
<FN>
See accompanying notes to consolidated financial statements.
</TABLE>
- 3 -
<PAGE>
TEXACO INC. AND SUBSIDIARY COMPANIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
------------------------------------------
Note 1. Assets Under Agreements for Sale
- ----------------------------------------
In 1994, Texaco announced that it agreed to sell more than 300 scattered U.S.
producing fields to Apache Corporation and agreed to form a strategic
alliance with STENA, which involves the sale of a portion of its international
marine fleet. At December 31, 1994, the net properties, plant and equipment
and deferred income taxes relating to those assets, and to other non-core
assets for which sales agreements had been signed, were classified as current
assets in the Consolidated Balance Sheet under the caption "Assets under
agreements for sale." During the first quarter 1995, Texaco completed
virtually all of these non-core asset sales, generating some $600 million in
cash proceeds. The remainder of these non-core assets will be sold during the
second quarter of 1995 and were included within the caption "Deferred income
taxes and other current assets" in the Consolidated Balance Sheet at
March 31, 1995.
Note 2. Discontinued Operations
- -------------------------------
In 1993, Texaco Inc. entered into memorandums of understanding with an
affiliate of the Jon M. Huntsman Group of Companies for the sale of
substantially all of Texaco's worldwide chemical operations and, therefore,
has accounted for these operations as discontinued operations.
On April 21, 1994, Texaco Inc. received from Huntsman Corporation $850
million as part of the sale of Texaco Chemical Company, consisting of $650
million in cash and an 11-year subordinated note with a face amount of $200
million. Not included in this transaction was Texaco's worldwide lubricant
additives business.On February 14, 1995, Texaco and Huntsman Corporation
announced that they intend to form a joint venture to own and operate this
business, which includes manufacturing facilities in Port Arthur, Texas,
Ghent, Belgium and Rio De Janeiro, Brazil, as well as sales and marketing
offices in various locations in the U.S. and abroad. Formation of the joint
venture and completion of the transaction is expected to take place during
the third quarter of 1995.
The results for Texaco's worldwide lubricant additives business are accounted
for as discontinued operations pending finalization of the formation of the
joint venture. The assets and liabilities of the worldwide lubricant
additives business have been classified in the Consolidated Balance Sheet as
"Net assets of discontinued operations."
Revenues for the discontinued operations totaled $54 million for the first
quarter of 1995, representing the lubricant additives business, and $268
million for the first quarter of 1994, which includes the operations of both
the chemical and lubricant additives businesses.
- 4 -
<PAGE>
Note 3. Inventories
- -------------------
The inventories of Texaco Inc. and consolidated subsidiary companies were as
follows:
<TABLE>
<CAPTION>
As of
------------------------
March 31, December 31,
1995 1994
---- ----
(Unaudited)
(Millions of dollars)
<S> <C> <C>
Crude oil $ 263 $ 284
Petroleum products and petrochemicals 946 854
Other merchandise 23 30
Materials and supplies 188 190
------ ------
Total $1,420 $1,358
====== ======
</TABLE>
Note 4. Contingent Liabilities
- ------------------------------
Information relative to commitments and contingent liabilities of Texaco Inc.
and subsidiary companies is presented in Notes 16 and 17, beginning on page
57, of Texaco Inc.'s 1994 Annual Report to Stockholders.
______________________
In the company's opinion, while it is impossible to ascertain the ultimate
legal and financial liability with respect to the above-mentioned and other
contingent liabilities and commitments, including lawsuits, claims,
guarantees, taxes and regulations, the aggregate amount of such liability in
excess of financial reserves, together with deposits and prepayments made
against disputed tax claims, is not anticipated to be materially important
in relation to the consolidated financial position or results of operations
of Texaco Inc. and its subsidiaries.
- 5 -
<PAGE>
Note 5. Caltex Group of Companies
- ---------------------------------
Summarized unaudited financial information for the Caltex Group of Companies,
owned 50% by Texaco and 50% by Chevron Corporation, is presented below and is
reflected on a 100% Caltex Group basis:
<TABLE>
<CAPTION>
For the three months
ended March 31,
--------------------
1995 1994
---- ----
(Millions of dollars)
<S> <C> <C>
Gross revenues $4,980 $3,368
Income before income taxes $ 542 $ 295
Net income $ 416 $ 178
</TABLE>
Net income for the first quarter of 1995 includes a net gain for U.S. reporting
purposes of $171 million relating to the sale of a portion of land and air
utility rights by a Caltex Petroleum Corporation affiliate in Japan required
for a public project. The proceeds include compensation that will be used to
remove and relocate or replace existing fixed operating assets affected by
the sale.
On March 28, 1995, the merger of refining and marketing assets of Caltex
Australia Limited (CAL), a 75 percent owned subsidiary of Caltex Petroleum
Corporation, with the refining and marketing assets of Ampol Limited, a unit
of Pioneer International Limited, received regulatory approval from the
Australian Trade Practices Commission. CAL and Pioneer each hold a 50 percent
stake in the new company, Australian Petroleum Pty Ltd.
Effective January 1, 1994, the Caltex Group adopted Statement of Financial
Accounting Standards (SFAS) No. 115 "Accounting for Certain Investments in
Debt and Equity Securities". SFAS No. 115 requires that certain investments
be classified into three categories based on management's intent and be
reported at fair value unless intended to be held to maturity. Adoption of
SFAS No. 115 had no effect on reported net income. The cumulative effect of
adopting SFAS No. 115 at January 1, 1994 resulted in an increase in Caltex's
total stockholders' equity of $70 million, after related income taxes, and
an additional net increase of $10 million during the first three months of
1994. These increases are primarily unrealized gains on investments
classified as available-for-sale by certain affiliates of Caltex.
* * * * * * * * * * *
In the determination of preliminary and unaudited financial statements for
the three-month periods ended March 31, 1995 and 1994, Texaco's accounting
policies have been applied on a basis consistent with the application of such
policies in Texaco's financial statements issued in its 1994 Annual Report to
Stockholders. In the opinion of Texaco, all adjustments and disclosures
necessary to present fairly the results of operations for such periods have
been made. These adjustments include normal recurring adjustments. The
information is subject to year-end audit by independent public accountants.
Texaco makes no forecasts or representations with respect to the level of net
income for the year 1995.
- 6 -
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
---------------------------------------------
RESULTS OF OPERATIONS
- ---------------------
Consolidated worldwide net income from continuing operations for Texaco Inc.
and subsidiary companies for the first quarter of 1995 was $301 million, or
$1.10 per share, as compared with $202 million, or $.69 per share, for the
first quarter of 1994. Net income for the first quarter of 1995 included net
gains of $88 million, principally relating to the sale of land by a Caltex
Petroleum Corporation affiliate in Japan and to sales of non-core U.S.
producing properties.
The company made good progress during the first quarter of 1995 on key
initiatives of its worldwide plan for growth. International production of oil
and gas continued to show solid growth, the company realized stronger Latin
American marketing profits, continued to make further inroads in expense
reduction and improved the efficiency of its capital program. The company
also closed the sale of major non-core producing assets in the U.S.,
realizing some $600 million in cash proceeds which will be reinvested in
growth opportunities.
The first quarter's performance benefited from worldwide crude oil prices
which averaged over $3 per barrel higher than last year's depressed levels.
This was offset by extremely depressed refining margins in the U.S. and in
Europe and an almost 30 percent comparative drop in U.S. natural gas prices.
Refining operations in the U.S. were pressured by rising raw material costs,
mandated new product formulations and changing government regulations.
Additionally, the weakening of the U.S. dollar in the first quarter of 1995
resulted in a non-cash earnings charge of $26 million relating to deferred
taxes in the United Kingdom.
OPERATING EARNINGS
PETROLEUM AND NATURAL GAS
UNITED STATES
Exploration and Production
Exploration and production earnings for the first quarter of 1995 were $143
million, as compared to $75 million for the first quarter of 1994. First
quarter 1995 results include a net gain of $8 million resulting from
previously announced non-core producing property sales after certain
write-downs of properties being held for sale and reserves for environmental
remediation on these properties totalling some $112 million. First quarter
1995 earnings benefited from crude oil prices that averaged $14.85 per barrel,
or $3.83 per barrel higher than the levels in the 1994 first quarter.
Operating earnings in the first quarter of 1995 were adversely impacted by
natural gas prices which were almost 30 percent, or $.64 per MCF, lower than
in the first quarter of 1994. The decline in U.S. natural gas prices reflects
abundant supplies in the face of reduced demand due to unseasonably warm
weather, particularly in the Northeast. First quarter 1995 results benefited
from lower expenses, reflecting both successful initiatives to reduce lifting
costs on core producing properties, as well as reduced overheads associated
with the non-core properties that are being sold.
Crude oil and natural gas production declined some 3 percent on a barrel-of-
oil equivalent basis compared with the first quarter of 1994, principally
relating to non-core producing properties. For core properties, normal
production declines from maturing fields generally have been offset by
successful field development programs.
- 7 -
<PAGE>
Manufacturing and Marketing
Manufacturing and marketing results for the first quarter of 1995 were losses
of $19 million, as compared with earnings of $78 million for the first
quarter of 1994. The first quarter of 1995 reflects the impact of extremely
depressed refining margins, as rising crude oil costs outpaced a moderate
rise in overall refined products prices. This reflects the impact of
unseasonably warm weather on middle distillates prices and the surplus of
reformulated gasolines caused by the highly disruptive market entry and
government regulation changes for these gasolines in several states. Also, a
narrowing cost spread between light and heavy crude oils reduced the
upgrading benefits normally derived from complex manufacturing systems.
Partially offsetting the impact of lower margins were benefits from the
improved performance at the company's U.S. refineries, reflecting increased
utilization in 1995, as compared to 1994 when the company experienced higher
scheduled downtime for maintenance.
INTERNATIONAL
Exploration and Production
Exploration and production earnings for the first quarter of 1995 were $82
million, as compared to $45 million for the first quarter of 1994. Operating
earnings for 1995 benefited from both increased crude oil and natural gas
production in the U.K., mainly from the Strathspey field, higher crude oil
production in Australia from the Roller and Skate fields that began producing
in mid-year 1994 and continuing field development programs in the Partitioned
Neutral Zone between Kuwait and Saudi Arabia.
First quarter 1995 earnings also benefited from crude oil prices that
averaged $3 per barrel higher than the prices that existed in the first
quarter of 1994. These price benefits were partly offset by higher
exploratory expenses. Additionally, exploration and production results in the
U.K. were adversely impacted in 1995 by a non-cash earnings charge of $13
million relating to deferred income taxes caused by the weak U.S. dollar/
British pound relationship at the closing of the quarter.
Manufacturing and Marketing
Manufacturing and marketing earnings for the first quarter of 1995 were $181
million, as compared to $125 million for the first quarter of 1994. First
quarter 1995 results include a net gain of $80 million principally relating
to the sale of land by a Caltex affiliate in Japan. Excluding this gain, 1995
operating earnings declined as compared to 1994 reflecting decreased European
refined product margins, particularly in the U.K. The poor margins resulted
from rising refinery feedstock costs that were not recovered in product
prices due to oversupply conditions in the marketplace. Additionally,
manufacturing and marketing results in the U.K. were impacted by the
weakening of the U.S. dollar in the first quarter of 1995 resulting in
non-cash earnings charges of $13 million relating to deferred income taxes.
Partly offsetting the decline in European results were the operations in
Latin America, which continue to reflect increased earnings. These
improvements, especially in Brazil, stem from both higher refined product
sales volumes and margins. However, downtime at the Panama refinery,
resulting from the fourth quarter 1994 fire, continued to have a negative
impact on 1995 results. In the Caltex markets in the Pacific Rim, the impact
of somewhat lower refining margins was more than offset by currency gains.
NONPETROLEUM
Net income was $4 million for the first quarter of 1995, as compared to a
loss of $1 million for the first quarter of 1994. Results for the first
quarter of 1995 reflect improved comparative results for Heddington Insurance
Limited, a subsidiary.
- 8 -
<PAGE>
CORPORATE/NONOPERATING
For the first quarter of 1995, corporate/nonoperating charges of $90 million
improved, compared with the $120 million for the first quarter of 1994.
Results for 1995 include $25 million in gains principally from sales of
equity securities held for investment, as well as higher interest income and
reduced corporate overhead reflecting the company's continuing progress in
reducing expenses. The impact of higher interest rates on corporate
borrowings was mostly offset by the effect of lower debt levels.
LIQUIDITY AND CAPITAL RESOURCES
- -------------------------------
As of March 31, 1995, Texaco's cash, cash equivalents and short-term
investments totaled $421 million, as compared to the 1994 year-end level of
$464 million. Texaco's total cash from operating activities for the first
quarter of 1995 (as presented on the Condensed Statement of Consolidated
Cash Flows) included several significant outflows that were not directly
related to current period operations, and which in the aggregate, amounted
to some $130 million. Among these outflows were payments related to
litigation settlements, mainly the State of Louisiana royalty dispute,
and severance.
During the first quarter of 1995, cash generated from normal operating
activities and proceeds from asset sales, which are discussed below, were
used to support Texaco's capital and exploratory expenditures of $440
million, for payment of dividends to common, preferred and minority
shareholders of $234 million, and for the reduction of debt.
Total debt at March 31, 1995 amounted to $6.1 billion as compared to $6.5
billion at year-end 1994. Texaco's ratio of total debt to total borrowed and
invested capital was 36.7% at March 31, 1995 and 38.5% at year-end 1994.
During the first quarter of 1995, Texaco terminated $175 million of its
receive fixed/pay floating interest rate swaps, reducing the notional
principal amount of these swaps from $777 million at December 31, 1994 to
$602 million at March 31, 1995.
Texaco maintains a revolving credit facility with commitments of $2.0
billion, which remained unused at both March 31, 1995 and at year-end 1994.
Additionally, a subsidiary maintains a long-term revolving credit facility
for $330 million, which was fully utilized at March 31, 1995 and year-end
1994 and is reflected in long-term debt.
At March 31, 1995, Texaco's long-term debt included $764 million of debt
scheduled to mature within one year, which the company has both the intent
and the ability to refinance on a long-term basis.
Proceeds from asset sales for the first quarter of 1995 amounted to $602
million. These proceeds were principally related to the disposition of
non-core producing properties in the United States, including some 300
scattered properties sold to Apache Corporation, and will be reinvested in
growth opportunities in core businesses.
Subsequent to March 31, 1995, Texaco completed the formation of a strategic
alliance with STENA, a Swedish marine transportation company, which will
coordinate the company's international marine transportation requirements.
In conjunction with this realignment, Texaco sold a portion of its
international marine fleet, generating proceeds of some $50 million.
The company considers its financial position sufficient to meet its
anticipated future financial requirements.
- 9 -
<PAGE>
EMPLOYEE SEVERANCE PROGRAM
- --------------------------
On July 5, 1994, Texaco announced its plan for growth which includes a series
of action steps to increase competitiveness and profitability. This program
also calls for reduction in overheads and improvements in operating
efficiencies. Implementation of Texaco's program is expected to result in
the reduction of approximately 2,500 employees involving both the U.S. and
international upstream and downstream segments, as well as various support
staff functions. During the second quarter of 1994, Texaco recorded a charge
of $88 million, net of tax, for the anticipated severance costs associated
with the reduction of the 2,500 employees.
As of March 31, 1995, implementation of Texaco's program has included
reductions of approximately 1,960 employees worldwide with a related
commitment to severance payments of $88 million, or an after-tax cost of
$58 million. Of this commitment, payments of $61 million have been made as
of March 31, 1995. Currently, there is no change in the company's projections
under this program.
CAPITAL AND EXPLORATORY EXPENDITURES
- ------------------------------------
Capital and exploratory expenditures for continuing operations, including
affiliates, were $513 million for the first quarter of 1995, as compared
with $624 million for the same period in 1994. This reduction mainly reflects
lower scheduled upstream expenditures during the first quarter in the U.S.,
as compared to an extremely high level of developmental gas drilling activity
in the first quarter of 1994, as well as efficiency improvements in areas
such as drilling in 1995.
- 10 -
<PAGE>
PART II - OTHER INFORMATION
Item 1. Legal Proceedings
- -------------------------
Reference is made to the discussion of Contingent Liabilities in Note 4 to
the Consolidated Financial Statements of this Form 10-Q and to Item 3 of
Texaco Inc.'s 1994 Annual Report on Form 10-K, which are incorporated herein
by reference.
Environmental Matters
As of March 31, 1995, Texaco Inc. and its subsidiaries were parties to
various proceedings, instituted by governmental authorities, arising under
the provisions of applicable laws or regulations relating to the discharge of
materials into the environment or otherwise relating to the protection of the
environment, none of which is material to the business or financial condition
of the company. The following is a brief description of a terminated
proceeding which, because of the amount involved, requires disclosure under
applicable Securities and Exchange Commission regulations:
On March 22, 1995, Texaco Trading and Transportation Inc.("TTTI") entered
into a Consent Agreement and Order settling an administrative proceeding
brought by the U.S. Environmental Protection Agency ("EPA"), Region VII,
in May 1994. The EPA alleged that pipelines owned by TTTI released oil
into surface waters in violation of the Federal Clean Water Act.
- 11 -
<PAGE>
Item 5. Other Information
- -------------------------
<TABLE>
<CAPTION>
(Unaudited)
--------------------
For the three months
ended March 31,
--------------------
1995 1994
---- ----
(Millions of dollars)
<S> <C> <C>
FUNCTIONAL NET INCOME
- ---------------------
Operating earnings (losses) from continuing operations
Petroleum and natural gas
Exploration and production
United States $143 $ 75
International 82 45
---- ----
Total 225 120
---- ----
Manufacturing, marketing and distribution
United States (19) 78
International 181 125
---- ----
Total 162 203
---- ----
Total petroleum and natural gas 387 323
Nonpetroleum 4 (1)
---- ----
Total operating earnings 391 322
Corporate/Nonoperating (90) (120)
---- ----
Net income from continuing operations 301 202
Discontinued operations - -
---- ----
Net income $301 $202
==== ====
CAPITAL AND EXPLORATORY EXPENDITURES
- ------------------------------------
Texaco Inc. and subsidiary companies
Exploration and production
United States $172 $270
International 115 123
---- ----
Total 287 393
---- ----
Manufacturing, marketing and distribution
United States 43 50
International 42 53
---- ----
Total 85 103
---- ----
Other 5 6
---- ----
Total 377 502
---- ----
Equity in affiliates
United States 32 25
International 104 97
---- ----
Total 136 122
---- ----
Total continuing operations 513 624
Discontinued operations 1 19
---- ----
Total, including equity in affiliates $514 $643
==== ====
</TABLE>
- 12 -
<PAGE>
<TABLE>
<CAPTION>
(Unaudited)
--------------------
For the three months
ended March 31,
--------------------
1995 1994
---- ----
<S> <C> <C>
OPERATING DATA - INCLUDING INTERESTS
- ------------------------------------
IN AFFILIATES
- -------------
Net production of crude oil and natural gas liquids
(thousands of barrels per day)
United States 389 408
Other Western Hemisphere 17 20
Europe 135 117
Other Eastern Hemisphere 238 239
----- -----
Total 779 784
Net production of natural gas available for sale
(millions of cubic feet per day)
United States 1,661 1,686
International 432 330
----- -----
Total 2,093 2,016
Natural gas sales (millions of cubic feet per day)
United States 3,277 2,914
International 481 349
----- -----
Total 3,758 3,263
Natural gas liquids sales, including purchased LPG's
(thousands of barrels per day)
United States 237 196
International 89 61
----- -----
Total 326 257
Refinery input (thousands of barrels per day)
United States 685 613
Other Western Hemisphere 23 51
Europe 313 329
Other Eastern Hemisphere 466 478
----- -----
Total 1,487 1,471
Refined product sales (thousands of barrels per day)
United States 890 816
Other Western Hemisphere 349 310
Europe 447 462
Other Eastern Hemisphere 780 723
----- -----
Total 2,466 2,311
</TABLE>
- 13 -
<PAGE>
Item 6. Exhibits and Reports on Form 8-K
- ----------------------------------------
(a) Exhibits
- (11) Computation of Earnings Per Share of Common Stock of Texaco Inc.
and Subsidiary Companies.
- (12) Computation of Ratio of Earnings to Fixed Charges of Texaco on
a Total Enterprise Basis.
- (20) Copy of Texaco Inc.'s Annual Report on Form 10-K for the fiscal
year ended December 31, 1994 (including portions of Texaco
Inc.'s Annual Report to Stockholders for the year 1994), as
previously filed by the Registrant with the Securities and
Exchange Commission, File No. 1-27.
- (27) Financial Data Schedule.
(b) Reports on Form 8-K:
During the first quarter of 1995, the Registrant filed a Current Report
on Form 8-K for the following event:
1. January 24, 1995 (date of earliest event reported: January 23, 1995)
Item 5. Other Events - reported that Texaco issued an Earnings
Press Release for the fourth quarter and year 1994. Texaco appended
as an exhibit thereto a copy of the Press Release entitled "Texaco
Reports Results for the Fourth Quarter and Year 1994," dated January
23, 1995.
- 14 -
<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.
Texaco Inc.
------------------
(Registrant)
By: R.C. Oelkers
------------------
(Comptroller)
By: R.E. Koch
------------------
(Assistant Secretary)
Date: May 10, 1995
------------
- 15 -
EXHIBIT 11
<TABLE>
<CAPTION>
TEXACO INC. AND SUBSIDIARY COMPANIES
COMPUTATION OF EARNINGS PER SHARE OF COMMON STOCK
FOR THE THREE MONTHS ENDED MARCH 31, 1995 AND 1994
--------------------------------------------------
(Millions of dollars, except per share amounts)
(Unaudited)
--------------------
For the three months
ended March 31,
--------------------
1995 1994
---- ----
<S> <C> <C>
Primary Net Income Per Common Share
- -----------------------------------
Net income from continuing operations $ 301 $ 202
Discontinued operations - -
------- -------
Net income 301 202
Less: Preferred stock dividend requirements 16 24
------- -------
Primary net income available for common stock $ 285 $ 178
======= =======
Average number of primary common shares
outstanding (thousands) 259,623 259,185
======= =======
Primary net income per common share $ 1.10 $ .69
======= =======
Fully Diluted Net Income Per Common Share
- -----------------------------------------
Net income $ 301 $ 202
------- -------
Preferred stock dividend requirements of non-dilutive
issues and adjustments to net income associated
with dilutive securities 6 24
------- -------
Fully diluted net income $ 295 $ 178
======= =======
Average number of primary common shares
outstanding (thousands) 259,623 259,185
Additional shares outstanding assuming full
conversion of dilutive convertible securities
into common stock, (thousands):
Convertible debentures 148 148
Convertible Preferred Stock
Series B ESOP 9,988 -
Series F ESOP 673 -
Other 84 74
------- -------
Average number of fully diluted common
shares outstanding (thousands) 270,516 259,407
======= =======
Fully diluted net income per common share $ 1.09 $ .69
======= =======
</TABLE>
EXHIBIT 12
<TABLE>
<CAPTION>
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
OF TEXACO ON A TOTAL ENTERPRISE BASIS (UNAUDITED)
FOR THE THREE MONTHS ENDED MARCH 31, 1995 AND
FOR EACH OF THE FIVE YEARS ENDED DECEMBER 31, 1994 (a)
------------------------------------------------------
(Millions of dollars)
For the Three Years Ended December 31,
Months Ended ------------------------------------------------
March 31, 1995 1994 1993 1992 1991 1990
-------------- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Income from continuing operations, before provision or
benefit for income taxes and cumulative effect of
accounting changes effective 1-1-92 $ 514 $1,409 $1,392 $1,707 $1,744 $2,448
Dividends from less than 50% owned companies
more or (less) than equity in net income (1) (1) (8) (9) 5 (7)
Minority interest in net income 17 44 17 18 16 12
Previously capitalized interest charged to
income during the period 8 29 33 30 23 16
------ ------ ------ ------ ------ ------
Total earnings 538 1,481 1,434 1,746 1,788 2,469
------ ------ ------ ------ ------ ------
Fixed charges:
Items charged to income:
Interest charges 154 594 546 551 644 676
Interest factor attributable to operating
lease rentals 29 118 91 94 76 58
Preferred stock dividends of subsidiaries
guaranteed by Texaco Inc. 10 31 4 - - -
------ ------ ------ ------ ------ ------
Total items charged to income 193 743 641 645 720 734
Interest capitalized 6 21 57 109 80 50
Interest on ESOP debt guaranteed by Texaco Inc. 4 14 14 18 26 38
------ ------ ------ ------ ------ ------
Total fixed charges 203 778 712 772 826 822
------ ------ ------ ------ ------ ------
Earnings available for payment of fixed charges $ 731 $2,224 $2,075 $2,391 $2,508 $3,203
(Total earnings + Total items charged to income) ====== ====== ====== ====== ====== ======
Ratio of earnings to fixed charges of Texaco
on a total enterprise basis 3.60 2.86 2.91 3.10 3.04 3.90
====== ====== ====== ====== ====== ======
<FN>
(a) Excludes discontinued operations.
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
TEXACO INC.'S QUARTERLY REPORT ON FORM 10-Q FOR THE PERIOD ENDED
MARCH 31, 1995 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH
FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000097349
<NAME> TEXACO INC.
<MULTIPLIER> 1,000,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-START> JAN-1-1995
<PERIOD-END> MAR-31-1995
<CASH> 391
<SECURITIES> 30
<RECEIVABLES> 3,231
<ALLOWANCES> 24
<INVENTORY> 1,420
<CURRENT-ASSETS> 5,547
<PP&E> 31,143
<DEPRECIATION> 18,008
<TOTAL-ASSETS> 24,987
<CURRENT-LIABILITIES> 4,418
<BONDS> 5,645
<COMMON> 1,624
0
530
<OTHER-SE> 7,766
<TOTAL-LIABILITY-AND-EQUITY> 24,987
<SALES> 8,585
<TOTAL-REVENUES> 9,059
<CGS> 6,526
<TOTAL-COSTS> 7,271
<OTHER-EXPENSES> 1,210
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 124
<INCOME-PRETAX> 454
<INCOME-TAX> 153
<INCOME-CONTINUING> 301
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 301
<EPS-PRIMARY> 1.10
<EPS-DILUTED> 1.10
</TABLE>
