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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) JULY 22, 1996
OCCIDENTAL PETROLEUM CORPORATION
(Exact name of registrant as specified in its charter)
DELAWARE 1-9210 95-4035997
(State or other jurisdiction (Commission (I.R.S. Employer
of incorporation) File Number) Identification No.)
10889 WILSHIRE BOULEVARD, LOS ANGELES, CALIFORNIA 90024
(Address of principal executive offices) (ZIP code)
Registrant's telephone number, including area code:
(310) 208-8800
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Item 5. Other Events
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Occidental Petroleum Corporation reported on July 22,
1996, net income of $181 million ($.49 per share) for the
second quarter of 1996, compared with net income of $187
million ($.51 per share) for the second quarter of 1995.
Sales were $2.5 billion for the second quarter of 1996,
compared with $2.7 billion for the second quarter of 1995.
Oil and gas divisional earnings were $144 million for
the second quarter of 1996, compared with earnings before
special items of $79 million for the second quarter of
1995. The 1995 results, after a charge of $109 million for
settlement of litigation, were a loss of $30 million. The
increase in 1996 earnings resulted primarily from higher
prices for worldwide crude oil and domestic natural gas.
Natural gas transmission divisional earnings for the
second quarter of 1996 were $51 million, compared with
$62 million for the second quarter of 1995. The decline in
1996 earnings resulted primarily from lower transport
margins, partially offset by lower costs related to the
reorganization in late 1995.
Chemical divisional earnings before special items for
the second quarter of 1996 were $160 million, compared
with earnings before special items of $314 million for the
second quarter of 1995. The 1996 second quarter results
were $212 million, after inclusion of $130 million related
to a favorable litigation settlement and a charge of $75
million for additional environmental reserves relating to
various existing sites, and the related state tax effects.
The 1995 results, after inclusion of a $40 million pretax
gain related to the sale of assets, were $354 million. The
decline in 1996 earnings resulted primarily from decreased
profit margins in petrochemicals and PVC resins.
Interest expense in the second quarter of 1996 was
$112 million compared with $133 million for the second
quarter of 1995. The decline in interest expense is
primarily attributable to lower average interest rates and
lower average debt levels resulting from the redemption on
March 15, 1996, of $955 million of 11 3/4% senior
debentures.
For the first six months of 1996, Occidental's net
income totaled $315 million or $.84 per share, compared
with net income of $365 million or $1.00 per share for the
first six months of 1995. The 1996 results included an
after-tax extraordinary loss of $30 million ($.09 per
share) for the early retirement of high-coupon debt. Sales
were $5.0 billion for the first six months of 1996,
compared with $5.4 billion for the same period in 1995.
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SUMMARY OF DIVISIONAL NET SALES AND EARNINGS
(Millions, except per-share amounts)
Second Quarter Six Months
---------------- ----------------
Periods Ended June 30 1996 1995 1996 1995
================================== ======= ======= ======= =======
DIVISIONAL NET SALES
Oil and gas $ 878 $ 756 $ 1,632 $ 1,461
Natural gas transmission 521 468 1,223 1,006
Chemical 1,058 1,456 2,126 2,928
Other - (1) (2) (2)
_______ _______ _______ _______
$ 2,457 $ 2,679 $ 4,979 $ 5,393
================================== ======= ======= ======= =======
DIVISIONAL EARNINGS
Oil and gas $ 144 $ (30) $ 305 $ 30
Natural gas transmission 51 62 172 137
Chemical 212 354 330 661
_______ _______ _______ _______
407 386 807 828
UNALLOCATED CORPORATE ITEMS
Interest expense, net (112) (133) (242) (277)
Income taxes (a) (112) (73) (211) (198)
Other (2) 7 (9) 12
_______ _______ _______ _______
INCOME BEFORE EXTRAORDINARY
GAIN(LOSS), NET 181 187 345 365
Extraordinary gain(loss), net - - (30) -
_______ _______ _______ _______
NET INCOME 181 187 315 365
Preferred dividends (23) (23) (46) (46)
_______ _______ _______ _______
EARNINGS(LOSS) APPLICABLE TO
COMMON STOCK $ 158 $ 164 $ 269 $ 319
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PRIMARY EARNINGS PER COMMON SHARE
Income before extraordinary
gain(loss), net $ .49 $ .51 $ .93 $ 1.00
Extraordinary gain(loss), net - - (.09) -
_______ _______ _______ _______
PRIMARY EARNINGS PER SHARE $ .49 $ .51 $ .84 $ 1.00
======= ======= ======= =======
FULLY DILUTED EARNINGS PER COMMON SHARE
Income before extraordinary
gain(loss), net $ .47 $ .49 $ .91 $ .96
Extraordinary gain(loss), net - - (.09) -
_______ _______ _______ _______
FULLY DILUTED EARNINGS PER SHARE $ .47 $ .49 $ .82 $ .96
======= ======= ======= =======
AVERAGE COMMON SHARES OUTSTANDING 322.4 318.2 320.9 317.8
================================== ======= ======= ======= =======
(a) Includes an adjustment to corporate taxes, as quarterly consolidated taxes
are computed in accordance with Interpretation No. 18 of APB Opinion No.
28 and hence are based on projections of total-year income and taxes.
Also, includes an offset for charges and credits in lieu of U.S. federal
income taxes allocated to the divisions. Divisional earnings in the second
quarters of 1996 and 1995 have benefited from credits allocated by
$4 million, $12 million and $7 million at oil and gas, natural gas
transmission and chemical, respectively.
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SUMMARY OF OPERATING STATISTICS
Second Quarter Six Months
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Periods Ended June 30 1996 1995 1996 1995
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NET OIL, GAS AND LIQUIDS
PRODUCTION PER DAY
United States
Crude oil and condensate
(thousands of barrels) 54 66 56 66
Natural gas liquids
(thousands of barrels) 11 12 11 11
Natural gas
(millions of cubic feet) 611 632 613 638
Other Western Hemisphere
Crude oil and condensate
(thousands of barrels) 130 130 129 126
Eastern Hemisphere
Crude oil and condensate
(thousands of barrels) 105 89 104 87
Natural gas
(millions of cubic feet) 120 118 128 113
NATURAL GAS TRANSMISSION DELIVERIES
Sales (billions of cubic feet) 150 134 343 308
Transportation
(billions of cubic feet) 326 353 845 768
CAPITAL EXPENDITURES (millions) $ 275 $ 220 $ 508 $ 380
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DEPRECIATION, DEPLETION AND
AMORTIZATION OF ASSETS (millions) $ 227 $ 235 $ 451 $ 473
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SIGNATURE
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.
OCCIDENTAL PETROLEUM CORPORATION
(Registrant)
DATE: July 23, 1996 S. P. Dominick, Jr.
--------------------------------
S. P. Dominick, Jr., Vice
President and Controller
(Chief Accounting and Duly
Authorized Officer)
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