EXHIBIT 20
CROWN
(registered trademark)
Crown Central Petroleum Corporation
Refiners / marketers of petroleum products & petrochemicals
One North Charles Street, P.O. Box 1168, Baltimore, Maryland 21203,
(410) 539-7400
July 27, 1995 Results
Second Quarter 1995
Dear Shareholders:
Crown Central Petroleum Corporation announced today a net profit
of $7.0 million ($.72 per share) in the second quarter of 1995,
compared to a net loss of $7.3 million ($.74 per share) in the second
quarter of 1994. Sales and operating revenues for the second quarter
were $483 million compared to revenues of $453 million in the second
quarter of 1994.
For the first six months of 1995 before an extraordinary item,
the Company had a net income of $.1 million ($.01 per share) on
revenues of $929 million compared to a net income of $1.4 million
($.14 per share) on revenues of $847 million in the first half of
1994. The net loss for six months, after the extra charge of $3.2
million ($.33 per share) due to early extinguishment of debt, was $3.1
million ($.32 per share).
During the second quarter, the Gulf Coast crack spread, used to
evaluate finished product margins, improved dramatically to $3.87 from
its average of $1.69 per barrel in the first quarter before slipping
somewhat during June. Due to a mild winter that resulted in more
traveling by the consuming public, spring stocks of gasoline were far
below average. Thus, when the driving season commenced during the
second quarter, coupled with increased demand, a strong pricing
environment developed for both the wholesale and retail markets.
Crown's high conversion refineries took advantage of this
opportunity by maximizing gasoline production during the second
quarter and reducing production of heating oil and diesel fuels which
were under pricing pressure for the period. Emphasis on controlling
refining operating expenses has resulted in a 8% reduction over last
year's results for the corresponding quarter.
Retail marketing also reported strong results for the quarter.
Retail same store gasoline volumes increased 2% for the quarter as
margins widened by 41%. Merchandise gross margins improved 12% for the
same period last year on a same store basis.
In seeking Crown's strategy of a greater balance between gasoline
production and retail marketing, 15 Conoco units will be purchased in
North Carolina (13) and Georgia (2) effective August 1. The high
growth area of Greensboro, N.C. represents the largest concentration
of these with nine new locations bringing our presence in the state to
74 units.
The Business Process Improvement Project is continuing on
schedule. Crown is well into the first phase which when completed will
provide an information system for timely and accurate decision making
capability at lower levels throughout the Company. Taking advantage of
computer technology now available will greatly increase both our
response to market conditions and maintain Crown's competitiveness in
an aggressive marketplace.
We continue to believe that the refining industry is well
positioned for fundamental improvement as evidenced by second quarter
performance. Relatively strong demand combined with capacity
constraints in the U.S. and reduced imported product form the basis
for this belief. We have every confidence that Crown has adopted
strategies to lead our Company to an even more successful and
profitable future.
Sincerely,
HENRY A ROSENBERG, JR. CHARLES L. DUNLAP
HENRY A. ROSENBERG, JR. CHARLES L. DUNLAP
Chairman and Chief Executive Officer President and Chief
Operating Officer
Crown Central Petroleum Corporation and Subsidiaries
Dollars in thousands, except per share data
Six Months EndedThree Months Ended
June 30 June 30
1995 1994
------------ --------------------------------
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Sales and operating revenues $928,736 $847,009 $483,312$453,423
Income (loss) before income taxes 2,219 4,553 11,426 (11,732)
Income (loss) before
extraordinary item 112 1,374 7,030 (7,286)
(Loss) from extraordinary item 1/(3,257 ) ---- ---- ----
Net (loss) income (3,145) 1,374 7,030 (7,286)
Income (loss) per share before
extraordinary item .01 .14 .72 (.74)
(Loss) per share from extraordinary item(.33 ) ---- ---- ----
Net (loss) income per share (.32) .14 .72 (.74)
Share used in the computation
of income (loss) per share 9,697,598 9,796,2989,697,5989,796,298
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<FN>
1/ During the first quarter of 1995, the Company incurred an
extraordinary loss as a result of the early
retirement of its outstanding 10.42% Senior Notes (Notes). The
outstanding Notes were retired
on January 24, 1995 from the proceeds received from the sale of
$125 million of unsecured 10 7/8%
Senior Notes due February 1, 2005.
This altered format of the quarterly statement represents a substantial
savings in report costs and delivery time. Should you wish further
information on the quarterly results, please call 1-800-610-1415 or
refer to the operating statistics sheet.
Crown Central Petroleum Corporation and Subsidiaries
Operating Statistics
Six Months Ended Quarter Ended
June 30 June 30
1995 1994 1995 1994
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REFINING
Production (BPD - M) 155 158 155
154
Production (MMbbl) 28.0 28.5 14.1
14.1
Gross Margin ($/bbl) 2.58 3.09 3.31
2.09
Gross Profit ($MM) 72.3 88.2 46.7
29.4
Operating Cost ($/bbl) 2.28 2.41 2.25
2.46
Operating Cost ($MM) 63.7 68.9 31.8
34.5
Net Refining Profit (Loss) ($MM) 8.6 19.3 14.9
(5.1 )
RETAIL
Number Stores 332 356 332
356
Volume (pmps - Mgal) 124 113 128
118
Volume (MMgal) 248 241 127
126
Gasoline Gross Margin ($/gal) 0.12 0.10 0.10
0.07
Gasoline Gross Profit ($MM) 28.7 23.3 13.3
9.0
Merchandise Sales (pmps - $M) 22.6 18.5 23.7
21.3
Merchandise Sales ($MM) 45.0 39.6 23.6
22.8
Merchandise Gross Margin (%) 30.0 30.6 30.5
28.9
Merchandise Gross Margin ($MM) 13.5 12.1 7.2
6.6
Retail Gross Profit ($MM) 42.2 35.4 20.5
15.6
Retail Operating Costs (pmps - $M) 17.5 16.8 16.9
16.6
Retail Net Profit (Loss) ($MM) 7.4 (0.6 )3.5
(2.2 )
Total Net Profit (Loss) ($MM) 16.0 18.7 18.4
(7.3 )
Corporate Overhead ($MM) 8.2 11.1 4.2
2.9
Depreciation and Amortization ($MM) 19.0 21.1 9.5
10.4
EBITDA ($MM) 26.8 28.7 23.7
0.2
LIFO Provision ($MM) 2.4 10.5 1.1
6.5
(Gain) on Sales
and Abandonments of P, P & E ($MM) (0.2 ) (0.3 )
0.0 0.0
EBITDAAL ($MM) 29.0 38.9 24.8
6.7
Net Interest Expense ($MM) 5.8 3.0 3.1
1.5
Capital Expenditures ($MM) 14.8 14.0 8.2
6.4
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<FN>
BPD = Barrels per day
bbl = barrel or barrels as applicable
gal = gallon or gallons as applicable
pmps = per month per store
M = in thousands
MM = in millions