Newspaper article THE JOURNAL RECORD

Chevron's Net Income Increases 0.5 Percent / Revenues $8.9 Billion

Newspaper article THE JOURNAL RECORD

Chevron's Net Income Increases 0.5 Percent / Revenues $8.9 Billion

Article excerpt

SAN FRANCISCO - An 0.5 percent increase in net income to $356 million, or $1.04 per share, was reported Tuesday for the first quarter of 1986 by San Francisco-based Chevron Corp.

Chevron, the nation's fourth largest oil company behind Exxon Corp. Mobil Corp. and Texaco Inc., had net income of $354 million, or $1.03 per share, in the first quarter of 1985. Revenues totaled $8.9 billion, down 29.4 percent from $12.6 billion.

The majority of the revenue decline, Chevron said, was due to significantly lower prices for crude oil and petroleum products. The remainder of the decrease was due to the absence of revenues generated by certain assets sold during 1985, notably Gulf's southeast U.S. refining and marketing operations and Gulf Canada, and to lower volumes.

First-quarter 1986 earnings, according to Board Chairman George M. Keller, reflected reduced domestic exploration and producing results, balanced by improved refining and marketing, chemical and mineral earnings.

""Although first-quarter earnings were comparable to last year, most of the earnings occurred in the first two months,'' said Keller. ""Should crude oil prices remain at their current depressed levels, we expect that our future earnings, particularly for our exploration and producing operations, would be substantially below first-quarter 1986 levels.''

Lower crude oil and natural gas prices during first-quarter 1986 reduced the company's exploration and producing profits in the United States.

""However, refined product sales margins benefited from lower crude oil costs throughout the quarter because product prices, although declining, did not fall as rapidly as crude costs,'' Keller said. ""As a result, refining and marketing earnings held up well for the quarter as a whole.''

The chairman noted that the impact of declining oil prices on foreign exploration and production earnings was mitigated by increased eastern hemisphere production volumes and by lower exploration expense. In addition, lower petroleum feedstock costs had a positive effect on chemical earnings.

Asset dispositions less write-offs added at net $36 million to first-quarter 1986 earnings. …

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