press release

Chevron Announces Second Quarter Results Earnings More Than Double

CHEVRON ANNOUNCES SECOND QUARTER RESULTS EARNINGS MORE THAN DOUBLE TO $607 MILLION

SAN FRANCISCO, July 24 -- Chevron Corporation today reported second quarter net income of $607 million ($.93 per share), more than double the year earlier second quarter earnings of $257 million ($.39 per share) and a 32 percent increase from the $459 million reported for this year's first quarter.

Net income for the first six months of 1995 was $1.066 billion ($1.63 per share) up 65 percent from $645 million ($.99 per share) reported for the 1994 first half.

The 1995 six month results benefited $59 million from special items while earnings for the 1994 comparable period were reduced $41 million by special charges. Special items did not have a material effect on second quarter results in either year.

Chairman and CEO Ken Derr noted that the company's second quarter operating results of $611 million were the highest since the Gulf War. Derr said, "We had an excellent quarter, reaching an annualized Return on Capital Employed for the quarter of 11.6 percent, bringing us closer to our goal of 12 percent.

"Our chemicals company reported record earnings for the second consecutive quarter, reflecting continued strong industry demand for petrochemicals," continued Derr. "Our U.S. downstream business returned to profitability following a poor first quarter, as refinery operations improved and product prices strengthened. Our international upstream operations once again turned in strong results, up 45 percent, driven by higher crude oil prices and a 5 percent increase in production. Despite low natural gas prices, our U.S. upstream business performed very well as a result of its productivity and cost reduction strategies.

"Our reorganizations and cost reduction efforts are contributing to our profitability. We have lowered our cost structure in recent years by over $1.3 billion, including a reduction in the regular work force of over 12,000 employees, enabling us to weather industry downturns and to get an extra boost when industry conditions are good. And we are continuing to pursue additional cost reduction opportunities throughout the company," concluded Derr.

Total revenues were $9.6 billion in the 1995 second quarter, up 8 percent from $8.8 billion in last year's second quarter. Total revenues for the first six months of 1995 were $18.6 billion, a 9 percent increase over 1994 first half revenues of $17.1 billion. Revenues increased from higher crude oil, refined product and chemicals prices, partly offset by lower refined product sales volumes and lower natural gas prices.

Net foreign exchange gains of $6 million were included in both the 1995 second quarter and six months results. Foreign exchange losses totaling $21 million were included in both the 1994 second quarter and first half net income.


Exploration and Production

U.S. exploration and production net earnings of $150 million were about flat with the $152 million earned in the 1994 second quarter. Higher average crude oil realizations were offset by lower natural gas prices and lower production volumes of both crude oil and natural gas. Operating and exploration expenses were lower; depreciation expenses declined in line with the lower production volumes.

Average crude oil realizations for the second quarter were $16.41 per barrel, up 14 percent from $14.34 per barrel in the 1994 second quarter. The company's average natural gas price declined 15 percent to $1.52 per thousand cubic feet from $1.79 in the prior year quarter. On an equivalent barrel basis, natural gas accounts for almost half of the company's U.S. production. Crude oil prices have declined in recent weeks and natural gas prices have remained depressed into the third quarter.

Net liquids production declined to 352,000 barrels per day, a 5 percent decline from 371,000 barrels per day in the 1994 quarter; net natural gas production of 1.9 billion cubic feet per day decreased from 2.1 billion cubic feet per day in the prior year quarter. The decline in production volumes was largely the result of normal field declines, partially offset by new field production.

International exploration and production net earnings for the quarter were $194 million, up 45 percent from $134 million in last year's second quarter. Earnings increased on higher crude oil prices and higher production volumes. Earnings in the 1995 quarter included a special charge of $3 million for an employee severance provision in connection with a work force reduction program.

Net liquids production increased 5 percent to 644,000 barrels per day, partially due to new fields coming on stream in Angola. Net natural gas production was up 7 percent to 556 million cubic feet per day.

Foreign exchange gains were $3 million in the 1995 second quarter, compared with foreign exchange losses of $5 million in the prior year second quarter.


Refining and Marketing

U.S. refining and marketing net earnings were $108 million in the 1995 second quarter, compared with a loss of $42 million in last year's second quarter, and were a dramatic turnaround from the $102 million loss incurred in this year's first quarter.

Sales margins improved on better refinery operations and higher product sales prices. Last year's second quarter, as well as the first quarter of 1995, suffered from extensive refinery downtime and operating problems, coupled with the failure of product prices to keep pace with the increasing crude oil costs during those periods. Second quarter 1994 results also included a special charge of $5 million for environmental remediation programs.

Refined product sales volumes declined 18 percent from last year's second quarter to 1.1 million barrels per day, reflecting the sale of the company's Port Arthur, Texas and Philadelphia refineries. Most of the volume decline occurred in unbranded bulk sales. Branded gasoline sales through the company's marketing system increased slightly.

In May, the company introduced its new gasolines containing Techron, a proprietary fuel additive. The products were launched with an extensive advertising campaign in the company's marketing areas and, as a result, advertising expense for the quarter increased.

International refining and marketing net earnings were $36 million, compared with $27 million in the second quarter of 1994. Results in both periods reflected low sales margins. Also, in the 1995 period the company's U.K. refinery was shut down for extended maintenance, which adversely affected earnings and sales volumes. Favorable foreign exchange fluctuations, primarily related to the company's Caltex affiliate, and improved shipping and trading operations more than offset the decreased U.K. results. Total international sales volumes increased 6 percent to 944,000 barrels per day due to higher Caltex sales and increased volumes from the company's trading activities.

Foreign exchange gains were $5 million in the 1995 second quarter, compared with foreign exchange losses of $9 million in the prior year second quarter.


Chemicals

Chemicals earned a record $175 million in the quarter, more than triple last year's second quarter net earnings of $49 million. Prices and volumes for the company's major products continued to be strong, particularly for ethylene, styrene and paraxylene. However, in recent weeks, prices have slowed their upward momentum.


Coal and Other Minerals

Coal and other minerals net earnings fell to $2 million from $12 million in the 1994 second quarter. Coal earnings declined on lower average sales prices and volumes due to mild weather and increased competition from lower priced natural gas. A special charge of $1 million for employee severance costs also contributed to the lower results.


Corporate and Other

Corporate and other incurred net charges of $58 million, compared with charges of $75 million in the 1994 second quarter. Lower corporate expenses and favorable consolidating income tax adjustments more than offset increased interest expense and lower real estate earnings.


Capital and Exploratory Expenditures

Capital and exploratory expenditures, including the company's share of affiliate expenditures, were $1.160 billion in the second quarter of 1995, up from $1.073 billion spent in last year's second quarter. Total expenditures for the first six months of 1995 were $2.147 billion, up slightly from $2.132 billion spent in the 1994 first half.


CHEVRON CORPORATION
FINANCIAL REVIEW

      CHEVRON CORPORATION - FINANCIAL REVIEW                       -1-
      (MILLIONS OF DOLLARS)

      CONSOLIDATED STATEMENT OF INCOME
      (unaudited)
      Second Quarter       Six Months
      Sales and Other
      Operating Revenues (1)  		$ 9,397  $ 8,702   $ 18,217 $ 16,807
      Equity in Net Income of Affiliated
      Companies and Other Income        	  170    122     394     281
      9,567  8,824  18,611  17,088

      COSTS AND OTHER DEDUCTIONS:
      Purchased Crude Oil and Products   4,616   4,200  9,134 	 7,884
      Operating Expenses                 1,346   1,603  2,711 	 3,100
      Exploration Expenses                  71      73    142   	 178
      Selling and Administrative
      Expenses                            342     325    643   	 633
      Depreciation, Depletion
      and Amortization                	  566    615    1,142  1,207
      Taxes Other Than
      on Income (1)                  1,417   1,403   2,790   2,748
      Interest and Debt Expense           104      83     214     156
      8,462   8,302  16,776  15,906
      Income Before Income Tax Expense      1,105    522    1,835   1,182
      Income Tax Expense                  498    265      769     537
      NET INCOME                            $ 607   $ 257  $ 1,066  $ 645

      PER SHARE AMOUNTS
      NET INCOME                          $ .93   $ .39    $ 1.63   $ .99
      DIVIDENDS                         $ .4625  $ .4625   $ .925  $ .925

      Average Common Shares
      Outstanding (000's)           652,017   651,675   651,956  651,650


      EARNINGS BY MAJOR OPERATING AREA
      (unaudited)                      Second Quarter        Six Months
      1995   1994       1995   1994
      Exploration and Production
      United States                    $ 150  $ 152    $ 300   $ 276
      International                      194    134      366     245
      Total Exploration
      and Production                     344    286      666     521
      Refining, Marketing and Transportation
      United States                      108   (42)        6      56
      International                       36    27       192      90
      Total Refining, Marketing
      and Transportation              144  (15)        198    146
      Total Petroleum Operations       488   271        864    667
      Chemicals                           175    49        338     75
      Coal and Other Minerals               2    12         14     27
      Corporate and Other (2)           (58)   (75)      (150)  (124)
      NET INCOME                          $ 607   $ 257    $ 1,066  $ 645

      (1) Includes consumer
      excise taxes          $ 1,227  $ 1,206   $ 2,412  $ 2,358
      (2) "Corporate and Other" includes interest expense, interest
      income on cash and marketable securities, corporate center costs,
      and real estate and insurance activities.
    

      CHEVRON CORPORATION - FINANCIAL REVIEW                       -2-
      (MILLIONS OF DOLLARS)


      SPECIAL ITEMS BY MAJOR OPERATING AREA   Second Quarter  Six Months
      (unaudited)                           1995   1994   1995   1994

      U.S. Exploration and Production      $ -   $ -    $ -   $ (15)
      International Exploration
      and Production                       (3)    -     (10)     -
      U.S. Refining, Marketing
      and Transportation                    -    (5)    (10)   (26)
      International Refining, Marketing
      and Transportation                    -     -      80      -
      Chemicals                              -     -       -      -
      Coal and Other Minerals               (1)    -      (1)     -
      Corporate and Other (1)                -     -       -      -
      Total Special Items               $ (4)  $ (5)  $ 59  $ (41)

      SUMMARY OF SPECIAL ITEMS           Second Quarter       Six Months
      (unaudited)                       1995   1994        1995   1994

      Environmental Remediation
      Provisions                      $ -   $ (5)    $ (10)  $ (26)
      Restructurings & Reorganizations  (4)     -       (11)      -
      Other, Net                         -      -        80     (15)
      Total Special Items            $ (4)  $ (5)     $ 59   $ (41)

      FOREIGN EXCHANGE GAINS (LOSSES)     $ 6   $ (21)    $ 6    $ (21)

      EARNINGS BY MAJOR OPERATING AREA
      EXCLUDING SPECIAL ITEMS
      (unaudited)                    Second Quarter       Six Months
      1995   1994       1995   1994
      Exploration and Production
      United States                  $ 150    $ 152     $ 300  $ 291
      International                    197      134       376    245
      Total Exploration and Production   347   286       676    536
      Refining, Marketing and Transportation
      United States                  108     (37)        16     82
      International                   36      27        112     90
      Total Refining, Marketing
      and Transportation            144    (10)       128    172
      Total Petroleum Operations        491    276        804    708
      Chemicals                         175     49        338     75
      Coal and Other Minerals             3     12         15     27
      Corporate and Other (1)          (58)   (75)     (150)  (124)
      Earnings Excluding Special Items  611    262    1,007     686

      Special Items                        (4)      (5)       59    (41)
      Net Income                     $ 607   $ 257   $ 1,066   $ 645

      (1)  "Corporate and Other" includes interest expense, interest
      income on cash and marketable securities, corporate center costs,
      and real estate and insurance activities.
    


      CHEVRON CORPORATION - FINANCIAL REVIEW                         -3-
      (MILLIONS OF DOLLARS)

      CONSOLIDATED BALANCE SHEET               June 30,     December 31,
      (unaudited)                               1995             1994

      ASSETS:
      Cash and Cash Equivalents              $ 824            $ 413
      Other Current Assets                   7,147            7,178
      Total Current Assets                 7,971            7,591
      Investments and Advances               4,288            3,991
      Properties, Plant and Equipment-Net   22,385           22,173
      Other                                    646              652
      TOTAL ASSETS                      $ 35,290         $ 34,407


      LIABILITIES:
      Short-Term Debt                      $ 3,771          $ 4,014
      Other Current Liabilities              5,369            5,378
      Total Current Liabilities            9,140            9,392
      Long-Term Debt and
      Capital Lease Obligations             4,451            4,128
      Deferred Income Taxes                  2,803            2,674
      Reserves For Employee Benefit Plans    1,570            1,574
      Deferred Credits and
      Other Noncurrent Obligations          2,034            2,043
      TOTAL LIABILITIES                   19,998           19,811
      STOCKHOLDERS' EQUITY                     15,292           14,596
      TOTAL LIABILITIES
      AND STOCKHOLDERS' EQUITY          $ 35,290          $ 34,407


      CONSOLIDATED STATEMENT OF CASH FLOWS                   Six Months
      (unaudited)                                 1995   1994

      OPERATING ACTIVITIES
      Net Income                                       $ 1,066   $ 645
      Adjustments
      Depreciation, depletion and amortization         1,142   1,207
      Dry hole expense related to
      prior years' expenditures                           6      26
      Distributions less than equity
      in affiliates' income                            (126)   (22)
      Net before-tax losses (gains)
      on asset retirements and sales                     16    (26)
      Net currency translation losses                     34      9
      Net increase in operating working capital       (432)   (829)
      Deferred income tax provision                      141     76
      Other                                             (76)   (73)
      Net cash provided by operating activities      1,771   1,013
      INVESTING ACTIVITIES
      Capital expenditures                          (1,584)  (1,407)
      Proceeds from asset sales                        354      140
      Net sales (purchases) of marketable securities     378    (2)
      Net cash used for investing activities        (852)   (1,269)
      FINANCING ACTIVITIES
      Net (payments) borrowings of
      short-term obligations                        (261)      880
      Proceeds from issuance of long-term debt        418         4
      Repayments of long-term debt and
      other financing obligations                     (62)    (462)
      Cash dividends paid                             (603)    (602)
      Purchases of treasury shares                      (2)      (3)
      Net cash used for financing activities         (510)   (183)

      EFFECT OF EXCHANGE RATE ON CASH AND CASH EQUIVALENTS   2    (2)

      NET CHANGE IN CASH AND CASH EQUIVALENTS              411    (441)

      CASH AND CASH EQUIVALENTS AT JANUARY 1, 1995 AND 1994  413   1,644
      CASH AND CASH EQUIVALENTS AT June 30, 1995 AND 1994 $ 824  $ 1,203

    

      CHEVRON CORPORATION - FINANCIAL REVIEW                       -4-

      CAPITAL AND EXPLORATORY
      EXPENDITURES (1)                    Second Quarter    Six Months
      (millions of dollars)                 1995    1994     1995  1994
      United States
      Exploration and Production    $ 220    $ 174    $ 382   $ 340
      Refining, Marketing
      and Transportation              203      213      386     398
      Chemicals                         26       18       43      34
      Other                             41       33       53      65
      Total United States             490      438      864     837


      International
      Exploration and Production       442      424      901     906
      Refining, Marketing
      and Transportation              217      203      365     371
      Chemicals                         11        3       16      10
      Other                              -        5        1       8
      Total International             670     635     1,283   1,295
      Worldwide                  $ 1,160  $ 1,073  $ 2,147  $ 2,132


      OPERATING STATISTICS (1)
      NET LIQUIDS PRODUCTION (MB/D):
      United States                     352     371      354     372
      International                     644     613      646     608
      Worldwide                        996     984    1,000     980


      NET NATURAL GAS PRODUCTION (MMCF/D):
      United States                   1,927    2,146   1,931   2,168
      International                     556      519     574     525
      Worldwide                      2,483    2,665   2,505   2,693


      SALES OF NATURAL GAS (MMCF/D):
      United States                  2,778   2,622    2,756   2,673
      International                    540     490      523     478
      Worldwide                     3,318   3,112    3,279   3,151


      SALES OF NATURAL GAS LIQUIDS (MB/D):
      United States                    192     185      220     198
      International                     49      26       48      33
      Worldwide                       241     211      268     231


      SALES OF REFINED PRODUCTS (MB/D):
      United States                1,106    1,344    1,102    1,326
      International                  944      891      964      918
      Worldwide                   2,050    2,235    2,066    2,244

      REFINERY INPUT (MB/D):
      United States                  997    1,237      953    1,195
      International                  551      625      584      632
      Worldwide                   1,548    1,862    1,537    1,827

      CHEMICALS SALES & OTHER OPERATING
      REVENUES (millions of dollars) (2)
      United States                $ 939   $ 665   $ 1,812   $ 1,262
      International                  167     136       319       264
      Worldwide                 $ 1,106   $ 801   $ 2,131   $ 1,526

      (1) Includes interest in affiliates.
      (2) Includes sales to other Chevron companies. 1994 amounts
      restated to conform with 1995 presentation.

    

Updated: July 1995