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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON D.C. 20549
_________________________________
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15 (d) of
the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
April 24, 1995
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TEXACO INC.
(Exact name of registrant as specified in its charter)
Delaware 1-27 74-1383447
(State or other jurisdiction of (Commission File (I.R.S. Employer
incorporation) Number) Identification Number)
2000 Westchester Avenue, 10650
White Plains, New York (Zip Code)
(Address of principal executive offices)
(914) 253-4000
(Registrant's telephone number, including area code)
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Item 5. Other Events
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1. On April 24, 1995, the Registrant issued an Earnings Press
Release entitled "Texaco Reports Results For The First Quarter
1995," a copy of which is attached hereto as Exhibit 99.1 and
made a part hereof.
Item 7. Financial Statements, Pro Forma Financial Information and
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Exhibits
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(c) Exhibits
99.1 Press Release issued by Texaco Inc. dated April 24, 1995,
entitled "Texaco Reports Results For The First Quarter
1995."
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the Registrant has duly caused this report to be signed on
its behalf by the undersigned hereunto duly authorized.
TEXACO INC.
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(Registrant)
By: R. E. KOCH
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(Assistant Secretary)
Date: April 24, 1995
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APPENDIX
Description of graphic material included in Exhibit 99.1.
The following information is depicted in graphic form in the Press
Release issued by Texaco Inc. dated April 24, 1995, entitled
"Texaco Reports Results for the First Quarter 1995" filed as
Exhibit 99.1 to this Form 8-K:
1. The first graph is located within the fifth paragraph of
Exhibit 99.1. Graph is entitled "Texaco Average U.S. Crude
Price Per Quarter" and is shown in dollars per barrel by
quarter for the year 1994 and first quarter of 1995. The Y
axis depicts dollars per barrel from $10.00 to $18.00 with
$2.00 increments. The X axis depicts the calendar quarters
for the year 1994 and first quarter of 1995. The plot points
are as follows:
First Quarter 1994 - $11.02 per barrel
Second Quarter 1994 - $13.45 per barrel
Third Quarter 1994 - $14.82 per barrel
Fourth Quarter 1994 - $14.45 per barrel
First Quarter 1995 - $14.85 per barrel
2. The second graph is located within the seventh paragraph
of Exhibit 99.1. Graph is entitled "Texaco Average U.S.
Natural Gas Price Per Quarter" and is shown in dollars
per MCF by quarters for the year 1994 and first quarter
of 1995. The Y axis depicts dollars per MCF from $0.00
to $3.00 with $.50 increments. The X axis depicts the
calendar quarters for the year 1994 and first quarter of
1995. The plot points are as follows:
First Quarter 1994 - $2.32/MCF
Second Quarter 1994 - $2.02/MCF
Third Quarter 1994 - $1.84/MCF
Fourth Quarter 1994 - $1.80/MCF
First Quarter 1995 - $1.68/MCF
Exhibit 99.1
TEXACO REPORTS RESULTS
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FOR THE FIRST QUARTER 1995
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FOR IMMEDIATE RELEASE: MONDAY, APRIL 24, 1995.
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WHITE PLAINS, N.Y., April 24 - Texaco announced today that
consolidated worldwide net income from continuing operations 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
Company affiliate in Japan and to sales of non-core U.S. producing
properties.
In commenting on 1995's first quarter performance, Alfred C. DeCrane,
Jr., Texaco's Chairman of the Board and Chief Executive Officer, stated,
"Good progress was made during the first quarter on key initiatives of our
worldwide plan for growth. International production of oil and gas is
continuing to show solid growth; we realized stronger Latin American
marketing profits, continued to make further inroads in expense reduction
and improved the efficiency of our capital program. We 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.
"While the quarter's performance benefited from worldwide crude oil
prices which were 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."
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- 2 -
ANALYSIS OF FUNCTIONAL NET INCOME
OPERATING EARNINGS FROM CONTINUING OPERATIONS
PETROLEUM AND NATURAL GAS
UNITED STATES
Exploration and Production
First quarter 1995 earnings 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.
Lower expenses benefited first quarter 1995 results, 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.
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- 3 -
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.
Manufacturing and Marketing
For the first quarter of 1995, losses of $19 million, compared with
earnings of $78 million for the first quarter of 1994, reflect 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 Texaco experienced
higher scheduled downtime for maintenance.
INTERNATIONAL
Exploration and Production
First quarter 1995 earnings 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.
Reported 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.
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- 4 -
Manufacturing and Marketing
First quarter 1995 earnings 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 in 1995, operating
earnings declined as compared to 1994 reflecting decreased European
refined product margins, particularly in the U.K. These poor margins
resulted from rising refinery feedstock costs that were not recovered in
product prices due to oversupply conditions in the marketplace. Results
in the U.K. also 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.
CORPORATE/NONOPERATING RESULTS FROM CONTINUING OPERATIONS
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.
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- 5 -
CAPITAL AND EXPLORATORY EXPENSES
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.
- xxx -
NOTE TO EDITORS: Tables for the first quarter are attached.
CONTACTS: David J. Dickson 914-253-4128
J. Michael Trevino 914-253-4175
Jim Reisler 914-253-4389
Cynthia Michener 914-253-4743
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First Quarter
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1995 1994
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FUNCTIONAL NET INCOME ($000,000)
Operating Earnings (Losses) from
Continuing Operations
Petroleum and natural gas
Exploration and production
United States $ 143 $ 75
International 82 45
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Total 225 120
Manufacturing, marketing and
distribution
United States (19) 78
International 181 125
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Total 162 203
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Total petroleum and
natural gas 387 323
Nonpetroleum 4 (1)
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Total operating earnings 391 322
Corporate/Nonoperating (90) (120)
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Net income from continuing operations 301 202
Discontinued chemical operations - -
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Total Net Income $ 301 $ 202
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Per common share (dollars):
Net income:
Continuing operations $ 1.10 $ .69
Discontinued operations - -
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Total net income $ 1.10 $ .69
Average number of common shares
outstanding (000,000) 259.6 259.2
- 7 -
First Quarter
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1995 1994
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OTHER FINANCIAL DATA ($000,000)
Revenues from continuing operations $ 9,059 $ 7,434
Total assets as of March 31 (a) $25,100 $26,343
Stockholders' equity as of March 31 (a) $ 9,920 $10,337
Total debt as of March 31 (a) $ 6,100 $ 6,996
Capital and exploratory expenditures
Texaco Inc. and subsidiary companies
Exploration and production
United States $ 172 $ 270
International 115 123
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Total 287 393
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Manufacturing, marketing and
distribution
United States 43 50
International 42 53
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Total 85 103
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Other 5 6
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Total Texaco Inc. and
subsidiaries 377 502
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Equity in affiliates
United States 32 25
International 104 97
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Total equity in affiliates 136 122
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Total continuing
operations 513 624
Discontinued chemical operations 1 19
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Total $ 514 $ 643
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Dividends paid to common
stockholders $ 208 $ 207
Dividends per common share (dollars) $ .80 $ .80
Dividend requirement for preferred
stockholders $ 16 $ 24
(a) Preliminary
- 8 -
First Quarter
1995 1994
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OPERATING DATA - INCLUDING INTERESTS
IN AFFILIATES
Net production of crude oil and
natural gas liquids (000 BPD)
United States 389 408
Other Western Hemisphere 17 20
Europe 135 117
Other Eastern Hemisphere 238 239
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Total 779 784
Net production of natural gas -
available for sale (000 MCFPD)
United States 1,661 1,686
International 432 330
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Total 2,093 2,016
Natural gas sales (000 MCFPD)
United States 3,277 2,914
International 481 349
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Total 3,758 3,263
Natural gas liquids sales
(including purchased LPGs) (000 BPD)
United States 237 196
International 89 61
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Total 326 257
Refinery input (000 BPD)
United States 685 613
Other Western Hemisphere 23 51
Europe 313 329
Other Eastern Hemisphere 466 478
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Total 1,487 1,471
Refined product sales (000 BPD)
United States 890 816
Other Western Hemisphere 349 310
Europe 447 462
Other Eastern Hemisphere 780 723
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Total 2,466 2,311
