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Unocal's Profit Plunges on Lower Oil Prices

April 29, 1998|From Times Wire Services

Unocal Corp. on Tuesday reported depressed first-quarter earnings because of sharply lower oil and natural gas prices.

The El Segundo-based company said it earned $18 million, or 7 cents per diluted share, after one-time charges of $54 million, down from earnings of $144 million, or 56 cents per diluted share, a year ago.

Excluding special items and discontinued operations, Unocal said it earned $72 million, or 30 cents a share from continuing operations in the quarter, compared with $188 million, or 73 cents, a year ago.

Revenue fell 17% to $1.20 billion.

Analysts had expected the company to earn 31 cents a share from continuing operations, according to earnings tracker First Call.

"The company's worldwide oil and gas operations were impacted significantly by lower crude oil and natural gas prices, lower U.S. natural gas production, and higher dry hole costs and exploration expenses," Unocal Chief Executive Roger Beach said.

Oil prices dropped to a nine-year low of less than $13 a barrel in the first quarter because of a global oversupply. Prices have since recovered to $15.50, following an agreement by the Organization of Petroleum Exporting Countries and non-OPEC nations to lower output.

On Tuesday, Unocal's shares rose 56 cents to $41.31 on the New York Stock Exchange.

Unocal said it expects an increase in output from its U.S. operations, to an average 178,000 barrels of oil equivalent per day for 1998, up from 173,000 in January and February.

At a Glance:

* San Diego-based Enova Corp., parent of San Diego Gas & Electric, reported first-quarter earnings of $48.4 million, or 43 cents a share, compared with $48.9 million, or 42 cents, in the year-earlier period.

Operating revenue was $616.9 million, compared with last year's $507.9 million, a 21.5% increase.

* Emeryville-based Chiron Corp. said profit was unchanged in the first quarter compared with a year earlier, as it prepares to spin off its diagnostics business and focus on developing drugs.

The world's second-largest biotechnology company said profit from continuing operations before charges and gains was $16 million, or 9 cents a diluted share, the same as the year-earlier period. Chiron had been expected to earn 11 cents a share before charges and gains.

* Menlo Park-based Spieker Properties Inc., one of the fastest-growing real estate investment trusts in the U.S., said first-quarter earnings rose 53% amid a strong West Coast office market and acquisitions.

It reported first-quarter funds from operations of $48.9 million, or 70 cents a diluted share, up from $32 million, or 61 cents, a year ago. Per-share results reflect an increase in the number of shares outstanding to 69.8 million from 52.6 million and were in line with expectations.

* Santa Monica-based Veterinary Centers of America Inc. said first-quarter earnings rose 57%, to $2.3 million, or 11 cents per diluted share, compared with $1.4 million, or 7 cents, a year ago. Revenue rose 13% to $63.3 million.

* Oakland-based Dreyer's Grand Ice Cream Inc. reported a first-quarter net loss of $5.6 million, or 22 cents per basic share, compared with a net loss of $50,000, or 5 cents, a year ago. The loss came as the company posted record revenue of $215.1 million, a 7% increase.

The quarterly net loss was larger than the 1997 quarter due primarily to lower product margins and increased promotional spending.


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