# Presentation: 199294

## Doing Financial Analysis

- Dr. Jon A. Rasmussen
- Energy Information Administration
- February 2000

## Topics

- Look at a company
- Peer Group Analysis / Benchmarking
- Profiling Companies
- Information Resources

## Looking at a Company

- Investor interest
-   -- some financial performance measures
- Public interest
- Track record

##  UNOCAL CORP

-                 KEY ANNUAL FINANCIAL RATIOS
-   FISCAL YEAR ENDING               12/31/1998  12/31/1997  12/31/1996
-   QUICK RATIO                                         0.76        1.06        0.77
-   CURRENT RATIO                                    1.01        1.29        1.99
-   SALES/CASH                                          23.02       17.10       23.51
-   SG & A/SALES                                           0.04        0.03        0.04
-   RECEIVABLES TURNOVER                   6.79        6.44        4.97
-   RECEIVABLES DAYS SALES                53.02       55.86       72.48
-   INVENTORIES TURNOVER                  30.61       33.61       40.81
-   INVENTORIES DAYS SALES                11.76       10.71        8.82
-   NET SALES/WORKING CAPITAL       456.58       16.95        3.18
-   NET SALES/PLANT & EQUIPMENT        1.04        1.20        1.11
-   NET SALES/CURRENT ASSETS               3.95        3.85        1.58
-   NET SALES/TOTAL ASSETS                    0.69        0.77        0.56
-   NET SALES/EMPLOYEES                 695,305     688,706     437,554
-   TOTAL LIAB/TOTAL ASSETS                  0.66        0.62        0.69

##   TOTAL LIAB/INVESTED CAPITAL   1.10        1.05        1.21

-   TOTAL LIAB/COMMON EQUITY      3.11        2.62        3.61
-   TIMES INTEREST EARNED                2.72        5.21        3.72
-   LONG TERM DEBT/EQUITY               1.16        0.94        1.29
-   TOTAL DEBT/EQUITY                          1.16        0.94        1.34
-   TOTAL ASSETS/EQUITY                      3.61        3.25        4.01
-   PRETAX INC/NET SALES                     0.06        0.13        0.15
-   PRETAX INC/TOTAL ASSETS              0.04        0.10        0.08
-   PRETAX INC/INVESTED CAPITAL     0.06        0.17        0.15
-   PRETAX INC/COMMON EQUITY        0.18        0.43        0.43
-   NET INCOME/NET SALES                     0.02        0.10        0.01
-   NET INCOME/TOTAL ASSETS              0.02        0.08        0.00
-   NET INCOME/INVESTED CAPITAL     0.03        0.13        0.01
-   NET INCOME/COMMON EQUITY        0.08        0.32        0.02

- UNOCAL CORP
-                 KEY ANNUAL FINANCIAL RATIOS (cont.)
-   FISCAL YEAR ENDING               12/31/1998  12/31/1997  12/31/1996

## Peer Group Analysis / Benchmarking

- How does the company’s performance compare with core competitors ?
-    -- example: corporate profitability
- How efficient is the company compared to the (1) average (2) top X% ?
-    -- example: upstream costs

## Example: Corporate Profitability

## Example: Upstream Costs

## Profiling Companies

## Financial Information Resources

- Annual and quarterly reports
- Company websites
- U.S. Securities & Exchange Commission
-    --  EDGAR

## Home page example: Unocal

- http://www.unocal.com/

-           Unocal home page
-                          Financial and statistical information about Unocal for analysts,
-                             investors and others who want to learn more about our
-                                            company.
-                            On-line quotes plus daily e-mail market recap report
-                            Includes downloadable financial tables
-                            1998 Annual Fact Book | Quarterly Fact Book | Production
-                          forecast
-                            1998 | 1997 | 1996
-                            Unocal's EDGAR filings with the SEC
-                            1999 Proxy Statement in pdf format

## Accessing EDGAR

-  Important Information About EDGAR (Read This                First! )
-                   General Information: Retrieving Data
-                   Search the EDGAR Database
-                   EDGAR Form Definitions
-                   EDGAR Data Documentation
-                   Master Indices
-                   Tools and Utilities
-                   Information for Filers and Others Interested in the
-                   EDGAR System:

## Search the EDGAR Archives

-                                  A keyword (WAIS) search of all the
-                                  header information in all the filings in
-                                  the database. For best results on most
-                                  company names, users should make
-                                  use of the connectors, which are
-                                  demonstrated on the bottom of the
-                                  search screen. For example, to search
-                                  on "Washington Energy," use the
-                                  keyphrase
-                                      Washington ADJ Energy
-                                  Otherwise, the search will try to
-                                  retrieve all filings with headers
-                                  containing "Washington" (including
-                                  street names in company addresses)
-                                  and all filings with headers containing
-                                  "Energy."

##               Search EDGAR Archives

-               Search EDGAR Archives
- Welcome to the archive of EDGAR documents. This is an index to 1994–1999 EDGAR documents stored
- on this server. The index is a full-text WAIS index of the header information contained in each document.
- Please enter your query in the search dialog box (above).

## Result(s) of EDGAR search

- For more information about TEXT, HTML, and PDF files, please click here.
- Query: Unocal
- Number of matches: 139

- UNOCAL CORP                         [text]   10-Q      (11/15/1999)     25906

- UNOCAL CORP                         [text]   10-K      (03/16/1999)     654300

- Company name                        Format   Form Type  Date Filed   (Bytes)

- File Size

## FILER:

-         COMPANY DATA:
-                 COMPANY CONFORMED NAME:                 UNOCAL CORP
-                 CENTRAL INDEX KEY:                      0000716039
-                 STANDARD INDUSTRIAL CLASSIFICATION:     CRUDE PETROLEUM & NATURAL GAS [1311]
-                 IRS NUMBER:                             953825062
-                 STATE OF INCORPORATION:                 DE
-                 FISCAL YEAR END:                        1231
-         FILING VALUES:
-                 FORM TYPE:              10-K
-                 SEC ACT:
-                 SEC FILE NUMBER:        001-08483
-                 FILM NUMBER:            99565385
-         BUSINESS ADDRESS:
-                 STREET 1:               2141 ROSECRANS AVE
-                 STREET 2:               STE 4000
-                 CITY:                   EL SEGUNDO
-                 STATE:                  CA
-                 ZIP:                    90245
-                 BUSINESS PHONE:         3107267600

## ITEM (S)                                                PART I                                                PAGE

- <S>        <C>                                                                                                <C>
-  1. and 2. Business and Properties.........................................................................     1
-       3.   Legal Proceedings...............................................................................    13
-       4.   Submission of Matters to a Vote of Security Holders.............................................    18
-            Executive Officers of the Registrant............................................................    18
-                                                        PART II
-       5.   Market for  Registrant's Common Equity and Related Stockholder Matters..........................    20
-       6.   Selected Financial Data.........................................................................    20
-       7.   Management's Discussion and Analysis of Financial Condition and Results of Operations...........    21
-      7A.   Quantitative and Qualitative Disclosures about Market Risk......................................    42
-       8.   Financial Statements and Supplementary Data.....................................................    44
-       9.   Changes in and Disagreements with Accountants on Accounting and Financial Disclosure............    90
-                                                        PART III
-      10.   Directors and Executive Officers of the Registrant..............................................    91
-      11.   Executive Compensation..........................................................................    91
-      12.   Security Ownership of Certain Beneficial Owners and Management..................................    91
-      13.   Certain Relationships and Related Transactions..................................................    91
-                                                        PART IV
-      14.   Exhibits, Financial Statement Schedules, and Reports on Form 8-K

## CONSOLIDATED EARNINGS

- - ----------------------------------------------------------------------------------------------------------------
- <S>                                                                       <C>            <C>            <C>
- Revenues
- Sales and operating revenues                                               $5,003         $5,781          $5,101
- Interest, dividends and miscellaneous income                               169             49              49
- Equity in earnings of affiliated companies                                     96            154             106
- Gain on sales of assets                                                       211             80              72
- - ----------------------------------------------------------------------------------------------------------------
-       Total revenues                                                        5,479          6,064           5,328
- Costs and other deductions
- Crude oil, natural gas and product purchases                                2,165          2,246           1,502
- Operating expense                                                           1,352          1,389           1,386
- Selling, administrative and general expense                                   136            107             151
- Depreciation, depletion and amortization                                      867            962             914
- Dry hole costs                                                                184            110             139
- Exploration expense                                                           203            193             117
- Interest expense (a)                                                          177            183             279
- Property and other operating taxes                                             57             70              72
- Distributions on convertible preferred securities of subsidiary trust          33             33              10
- - ----------------------------------------------------------------------------------------------------------------
-       Total costs and other deductions                                      5,174          5,293           4,570
- - ----------------------------------------------------------------------------------------------------------------
- Earnings from continuing operations before income taxes                       305            771             758

## CONSOLIDATED EARNINGS(CONT.)

- - ----------------------------------------------------------------------------------------------------------------
- Earnings from continuing operations before discontinued
-    operations and extraordinary item                                          130            669             456
- Discontinued operations
-       Earnings from operations (b)                                              -              -              71
-       Loss on disposal (c)                                                      -            (50)           (491)
- - ----------------------------------------------------------------------------------------------------------------
-       Loss from discontinued operations                                         -            (50)           (420)
- Extraordinary item
-    Early extinguishment of debt (d)                                             -            (38)              -
- - ----------------------------------------------------------------------------------------------------------------
- Net earnings                                                                               $  130            581            36

## Slide 20