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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 March 31, 1995
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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 1-4014
FINA, Inc.
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(Exact name of registrant as specified in its charter)
Delaware 13-1820692
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
Fina Plaza, Dallas, Texas 75206
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (214)750-2400
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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 over the past 90 days.
Yes X No
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APPLICABLE ONLY TO CORPORATE ISSUERS:
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
14,595,069 Class A as of May 1, 1995
1,000,000 Class B as of May 1, 1995
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FINA, Inc. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS, EXCEPT SHARE AND PER SHARE AMOUNTS)
(UNAUDITED)
MARCH 31, DECEMBER 31,
1995 1994
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Assets
Current assets:
Cash and cash equivalents $2,682 $3,533
Accounts and notes receivable 390,818 365,614
Inventories 308,464 286,538
Prepaid expenses and other current assets 28,605 30,394
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Total current assets 730,569 686,079
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Property, plant, and equipment; net of $1,285,157
accumulated depreciation at 3/31/95 1,670,604 1,691,062
Other assets 117,315 116,721
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$2,518,488 $2,493,862
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Liabilities and Stockholders' Equity
Current liabilities:
Short term obligations $62,000 $57,000
Current installments of long term debt and
Lease obligations 61,083 61,014
Accounts payable and accrued liabilities 451,257 452,387
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Total current liabilities 574,340 570,401
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Long term debt, excluding current installments 528,035 531,162
Other deferred credits and liabilities 253,397 247,492
Stockholders' equity: (note 2)
Preferred stock of $1 par value. Authorized 4,000,000 shares; none issued - -
Class A common stock of 50 cents par value. Authorized 38,000,000 shares; issued
and outstanding 29,189,804 and 29,189,404 shares in 1995 and 1994 14,595 14,595
Class B common stock of 50 cents par value. Authorized and issued
2,000,000 shares 1,000 1,000
Additional paid-in capital 450,043 450,029
Retained earnings 697,078 679,183
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Total stockholders' equity 1,162,716 1,144,807
Commitments and contingencies (note 3) - -
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$2,518,488 $2,493,862
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See accompanying notes to consolidated financial statements.
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FINA, Inc. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF EARNINGS
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
(UNAUDITED)
THREE MONTHS ENDED MARCH 31,
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1995 1994
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Revenues:
Sales and other operating revenues $863,188 $777,450
Interest and other, net (1,850) 35
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861,338 777,485
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Costs and expenses:
Cost of raw materials and products purchased 636,774 561,412
Direct operating expenses 88,490 92,781
Selling, general, and administrative expenses 20,806 20,464
Taxes, other than on income 11,911 12,476
Dry holes and abandonments 1,516 646
Depreciation, depletion, amortization,
and lease impairment 38,445 42,416
Interest charges, net 11,958 10,506
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809,900 740,701
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Earnings before income taxes 51,438 36,784
Income taxes 17,948 11,767
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Net earnings $33,490 $25,017
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Earnings per common share: (note 2) $1.07 $0.80
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See accompanying notes to consolidated financial statements.
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FINA, Inc. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
THREE MONTHS ENDED MARCH 31, 1995 AND 1994
(IN THOUSANDS)
(UNAUDITED)
1995 1994
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Cash flows provided by operating activities $31,032 $41,906
Cash flows from investing activities:
Capital Expenditures (22,398) (17,258)
Proceeds from disposal of assets 5,609 4,073
Investments in and advances to affiliates (1,406) (2,928)
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Net cash provided by (used in) investing activities (18,195) (16,113)
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Cash flows from financing activities:
Additions to long term debt and lease obligations 0 0
Payments of long term debt and lease obligations (3,107) (3,336)
Net change in short term obligations 5,000 (10,000)
Issuance of common stock 14 0
Dividends paid (15,595) (12,475)
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Net cash used in financing activities (13,688) (25,811)
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Net decrease in cash and cash equivalents (851) (18)
Cash and cash equivalents at beginning of period 3,533 3,276
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Cash and cash equivalents at end of period $2,682 $3,258
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See accompanying notes to consolidated financial statements.
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FINA, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MARCH 31, 1995
(UNAUDITED)
(1) The information furnished reflects all adjustments which are, in the
opinion of management, necessary to a fair presentation of the results
of the interim periods presented.
(2) Earnings per common share is based on the weighted average number of
oustanding shares. Shares issuable upon the exercise of stock options
are excluded from the computation since their effect is insignificant.
The Company has declared a two-for-one stock split with record date of
May 2, 1995, at close of business. The par value will be 50 cents per
share of both Class A and Class B stock. Share and per share amounts
in the accompanying financial statements have been adjusted
retroactively to reflect the stock split. The weighted average number
of outstanding shares was 31,189,604 and 31,187,004 for the three
months ended March 31, 1995 and 1994, respectively.
(3) The Company is contingently liable under pending lawsuits and other
claims, some of which involve sustantial sums. Considering certain
liabilities which have been set up for the lawsuits and claims, and the
difficulty in determining the ultimate liability in some of these
matters, internal counsel is of the opinion that the amounts, if any,
which ultimately might be due in connection with such lawsuits and
claims would not have a material adverse effect upon the Company's
consolidated financial condition.
(4) The notes to the consolidated financial statements on pages 20 through
32 of the Company's 1994 Form 10-K are an integral part of these
consolidated financial statements.
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PART I - Item 2
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS.
Net earnings were $33,490,000 for the quarter ended March 31, 1995
compared to $25,017,000 for the first quarter of 1994. Sales and other
operating revenues were $863,188,000 compared to $777,450,000 for first quarter
1994. Earnings per share were $1.07 compared to $0.80 per share for the first
quarter of last year.
Earnings in the first quarter 1995 were largely attributable to Chemicals
which capitalized on world scale, low-cost plants and large market shares in
styrene, polystyrene and polypropylene. Upstream results declined from the same
period last year because of lower natural gas prices and lower crude and
natural gas production volumes. In the Downstream, refining margins declined
from the same period last year.
During the first quarter, a $400 million revolving bank credit facility
with Nationsbank of Texas N.A., as lead agent, was implemented to replace a $400
million facility which expired in March 1995. Also, the Board of Directors made
the decision to increase the cash dividend by 20% beginning in June 1995.
On May 2, 1995, following stockholder approval, a charter amendment was
filed in the State of Delaware which changed the Class A and Class B Common
Stock of the Company from $1.00 par value per share to fifty cents,
effectively splitting the stock 2-for-1.
Upstream results in the first quarter were down compared with the
corresponding period last year primarily due to lower natural gas prices and
crude and natural gas production volumes and higher dry hole and seismic
expenses. The Company has nearly completed its program to divest properties not
fitting the long-term strategic plan. Focus was on increased exploration and
drilling.
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Downstream reported decreased earnings in the quarter compared to first
quarter 1994. Throughout the first quarter of 1995, lower refining margins
prevailed. Compared to first quarter 1994, Gulf Coast fuels refining margins
were down about $2.00/BBL and West Texas industry margins were down about
$1.00/BBL. Total throughput at both refineries was 214MBD.
Chemicals earnings more than doubled compared to first quarter 1994.
Chemical products enjoyed strong demands and margin increases compared to the
same period last year. After planned expansions, the LaPorte, Texas
polypropylene plant and the Carville, Louisiana polystyrene plant are expected
to be the largest in the world.
The Company's annual meeting of shareholders was held April 12, 1995. All
members of the Board of Directors were reelected.
At its regularly scheduled meeting on April 20, 1995, the Board of
Directors elected Patricia M. Wallington to the Board and named her to the
Audit Committee of the Board. Also, the Board named three new Vice Presidents,
four senior Vice Presidents (who had formerly been Vice Presidents) and
appointed a new Controller.
The Company's regular quarterly dividend of $.50 per share (adjusted to
reflect the stock split) was paid March 16, 1995 to shareholders of record on
March 6, 1995. The next declared dividend of $.60 per share will be paid on
June 15, 1995 to shareholders of record on June 2, 1995.
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Part II - OTHER INFORMATION
Item 1. Legal Proceedings.
Not Applicable
Item 2. Changes in Securities.
(a) Not Applicable
(b) Not Applicable
Item 3. Defaults upon Senior Securities.
Not Applicable
Item 4. Submission of Matters to a Vote of Security Holders.
At the annual meeting of shareholders, held April 12, 1995, a proposal
to increase authorized shares and decrease par value from $1.00 to
$.50 was approved by vote as follows:
FOR: 14,333,901 AGAINST: 22,567 ABSTAIN: 19,666
Item 5. Other Information.
Not Applicable
Item 6. Exhibits and Reports on Form 8-K.
No Form 8-K's were filed during the period January 1, 1995 through
March 31, 1995. Form 10-K/A Amendment Number 1 and Form 10-K/A Amendment
Number 2 were filed on April 26, 1995 as cover for the Forms 11-K pertaining to
the FINA Capital Accumulation Plan (a 401(k) plan) and the Amdel Savings Plan.
Exhibits incorporated herein by reference:
(3a) The Articles of Incorporation of FINA, Inc.
-amended to reflect 2-for-1 stock split by
reclassified par value of 50 cents
(27) Financial Data Schedule
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.
FINA, Inc.
(REGISTRANT)
Date: May 12, 1995
BY: /s/ Yves Bercy
Yves Bercy
Vice President, Chief
Financial Officer and
Treasurer
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INDEX TO EXHIBITS
EXHIBIT
NUMBER DESCRIPTION
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(3a) The Articles of Incorporation of FINA, Inc.
-amended to reflect 2-for-1 stock split by
reclassified par value of 50 cents
(27) Financial Data Schedule