EX-99.1 2 dex991.htm PRESS RELEASE DATED AUGUST 3, 2005 Press Release dated August 3, 2005

Exhibit 99.1

 

LOGO   News Release
   

Sunoco, Inc.

1735 Market Street

Philadelphia, Pa. 19103-7583

 

For further information contact  

For release: 8 a.m. August 3, 2005

Jerry Davis (media) 215-977-6298

   

Terry Delaney (investors) 215-977-6106

   

 

No. 4038

SUNOCO REPORTS SECOND QUARTER RESULTS

 

PHILADELPHIA, August 3, 2005 — Sunoco, Inc. (NYSE: SUN) today reported net income of $242 million ($1.75 per share diluted) for the second quarter of 2005 versus $234 million ($1.53 per share diluted) for the 2004 second quarter. For the first half of 2005, Sunoco reported net income of $358 million ($2.58 per share diluted) versus net income of $323 million ($2.12 per share diluted) for the first half of 2004. All per-share amounts reflect the two-for-one stock split effected as a dividend on August 1, 2005.

 

“Results continued to be very strong,” said John G. Drosdick, Sunoco Chairman and Chief Executive Officer. “Our second-quarter earnings represent a new record for the Company and on a per-share basis, year-to-date earnings are up 22 percent versus last year’s then-record first half.

 

“Market conditions for our refining business remained robust and operationally we set several new quarterly production records, including total crude unit and conversion unit throughput. In a particularly strong market for distillate products, we achieved record distillate production. We also increased our use of discounted high-acid crude oils to approximately 59,000 barrels per day during the quarter and have run over 70,000 barrels per day when market conditions have warranted. Optimization efforts and reliability improvements such as these helped Refining and Supply earn $212 million for the quarter. This organization has done an excellent job meeting the challenges and the opportunities that the market has provided.

 

“Chemicals continued to improve year-on-year results, earning $30 million in the quarter versus $12 million in the second quarter of 2004. Margins, particularly for phenol and related products, were much improved versus the year-ago quarter. Over the past twelve months, Sunoco Chemicals has earned $133 million and has become a much bigger contributor to our overall results. Despite some slowdown in apparent demand growth, we believe the outlook for continued improvement in this business remains favorable.”

 

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SUNOCO 2Q05 EARNINGS, PAGE 2

 

Drosdick continued, “In other businesses, Retail Marketing earned $7 million. While much improved from the 2005 first quarter, generally rising crude oil and wholesale gasoline prices have persistently squeezed retail margins throughout the first half of the year. Sun Coke earned $13 million in the quarter as operations at our new coke plant in Haverhill, Ohio began to contribute. Logistics earned $9 million for the quarter.

 

“In other matters, we continued our share repurchase program - $61 million during the quarter and $131 million year to date – and on August 1, we completed a two-for-one stock split. We ended the quarter with $417 million of cash and a net debt-to-capital ratio, as defined in our revolving credit agreement, of 33 percent – each improved from year-end 2004. We will continue to carefully use this financial capacity to both invest in and grow our asset portfolio and appropriately return cash to our shareholders.”

 

DETAILS OF SECOND QUARTER RESULTS

 

REFINING AND SUPPLY

 

Refining and Supply earned $212 million in the current quarter versus $217 million in the second quarter of 2004. Despite a decline in benchmark margins in the Northeast, realized margins have improved versus the year-ago quarter largely as a result of the increased use of discounted high-acid crude oils and the favorable impact of product optimization activities. The higher realized margins and higher production volumes were more than offset by higher expenses, including fuel and employee-related charges.

 

Total crude unit throughput averaged 890.8 thousand barrels daily (99 percent utilization) for the quarter, with total production available for sale approximating 86 million barrels.

 

RETAIL MARKETING

 

Retail Marketing earned $7 million in the second quarter of 2005 versus $20 million in the second quarter of 2004. The decrease in results was due largely to lower retail margins for gasoline, partially offset by lower expenses and higher gains on asset divestments.

 

CHEMICALS

 

Chemicals earned $30 million in the second quarter of 2005 versus $12 million in the prior-year period. The increase in earnings was due largely to higher realized margins for phenol and polypropylene. Total sales volumes were down slightly from the year-ago period due primarily to scheduled maintenance performed during the quarter at the Haverhill, Ohio phenol facility. This maintenance was performed concurrent with work to tie in the plant to the steam generation system at Sun Coke’s adjacent cokemaking facility which will serve to reduce the phenol facility’s energy costs in the future.

 

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SUNOCO 2Q05 EARNINGS, PAGE 3

 

LOGISTICS

 

Earnings for the Logistics segment were $9 million in both second-quarter periods.

 

COKE

 

The Coke business earned $13 million in the second quarter of 2005 versus $9 million in the second quarter of 2004. The increase was due largely to higher coal sales volumes and prices and the start-up of the Haverhill coke plant during the quarter.

 

CORPORATE AND OTHER

 

Corporate administrative expenses were $16 million after tax in the current quarter versus $13 million in the comparable quarter last year. The increase was largely due to higher employee-related expenses, including accruals for stock-based incentive compensation.

 

Net financing expenses were $13 million after tax in the second quarter of 2005 versus $20 million in the prior-year quarter. The decrease was primarily due to lower interest expense resulting from 2004 debt restructuring activities and increased capitalized interest.

 

SIX MONTH RESULTS

 

Sunoco earned $358 million for the first six months of 2005 versus $323 million in the comparable 2004 period. The increase was primarily due to higher refining margins and volumes, increased chemicals margins and lower net financing expenses. Partially offsetting these improvements were lower retail gasoline margins and higher expenses.

 

Sunoco, Inc., headquartered in Philadelphia, PA, is a leading manufacturer and marketer of petroleum and petrochemical products. With 900,000 barrels per day of refining capacity, approximately 4,800 retail sites selling gasoline and convenience items, approximately 4,500 miles of crude oil and refined product owned and operated pipelines and 38 product terminals, Sunoco is one of the largest independent refiner-marketers in the United States. Sunoco is a significant manufacturer of petrochemicals with annual sales of approximately five billion pounds, largely chemical intermediates used to make fibers, plastics, film and resins. Utilizing a unique, patented technology, Sunoco also has the capacity to manufacture over 2.5 million tons annually of high-quality metallurgical-grade coke for use in the steel industry.

 

Anyone interested in obtaining further insights into the second quarter’s results can monitor the Company’s quarterly teleconference call, which is scheduled for 3:00 p.m. ET today (August 3, 2005). It can be accessed through Sunoco’s Web site - www.SunocoInc.com. It is suggested that you visit the site prior to the teleconference to ensure that you have downloaded any necessary software.

 

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SUNOCO 2Q05 EARNINGS, PAGE 4

 

Those statements made in this release that are not historical facts are forward-looking statements intended to be covered by the safe harbor provisions of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Although Sunoco believes that the assumptions underlying these statements are reasonable, investors are cautioned that such forward-looking statements are inherently uncertain and necessarily involve risks that may affect Sunoco’s business prospects and performance causing actual results to differ materially from those discussed in the foregoing release. Such risks and uncertainties include, by way of example and not of limitation: general business and economic conditions; competitive products and pricing; effects of weather conditions and natural disasters on the Company’s operating facilities and on product supply and demand; changes in refining, marketing and chemical margins; variation in petroleum-based commodity prices and availability of crude oil and feedstock supply or transportation; effects of transportation disruptions; changes in the price differentials between light-sweet and heavy-sour crude oils; fluctuations in supply of feedstocks and demand for products manufactured; changes in product specifications; availability and pricing of oxygenates; phase-outs or restrictions on the use of MTBE; changes in operating conditions and costs; changes in the expected level of environmental capital, operating or remediation expenditures; age of, and changes in the reliability and efficiency of, the Company’s or a third party’s operating facilities; potential equipment malfunction; potential labor-relations problems; the legislative and regulatory environment; ability to identify acquisitions, execute them under favorable terms and integrate them into the Company’s existing businesses; ability to enter into joint ventures and other similar arrangements under favorable terms; plant construction/repair delays; nonperformance by major customers, suppliers, dealers, distributors or other business partners; changes in financial markets impacting pension expense and funding requirements; political and economic conditions, including the impact of potential terrorist acts and international hostilities; and changes in the status of, or initiation of new, litigation. These and other applicable risks and uncertainties have been described more fully in Sunoco’s Form 10-Q filed with the Securities and Exchange Commission on May 5, 2005 and in other periodic reports filed with the Securities and Exchange Commission. Sunoco undertakes no obligation to update any forward-looking statements in this release, whether as a result of new information or future events.

 

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SUNOCO 2Q05 EARNINGS, PAGE 5

 

Sunoco, Inc.

2005 Second Quarter and Six-Month Financial Summary

(Unaudited)

 

     2005

   2004

Second Quarter

             

Revenues

   $ 7,990,000,000    $ 6,276,000,000

Net Income

   $ 242,000,000    $ 234,000,000

Net Income Per Share of Common Stock*:

             

Basic

   $ 1.77    $ 1.55

Diluted

   $ 1.75    $ 1.53

Weighted-Average Number of Shares Outstanding* (In Millions):

             

Basic

     137.1      150.9

Diluted

     138.0      152.6

Six Months

             

Revenues

   $ 15,199,000,000    $ 11,521,000,000

Net Income

   $ 358,000,000    $ 323,000,000

Net Income Per Share of Common Stock*:

             

Basic

   $ 2.60    $ 2.14

Diluted

   $ 2.58    $ 2.12

Weighted-Average Number of Shares Outstanding* (In Millions):

             

Basic

     137.7      150.9

Diluted

     138.5      152.7

* Share and per-share data presented for all periods reflect the effect of a two-for-one stock split, which was effected in the form of a common stock dividend distributed on August 1, 2005.

 

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SUNOCO 2Q05 EARNINGS, PAGE 6

 

Sunoco, Inc.

Earnings Profile of Sunoco Businesses (after tax)

(Millions of Dollars Except Per Share Amounts)

(Unaudited)

 

    

Three Months

Ended June 30


    Variance

 
     2005

    2004

   

Refining and Supply

   $ 212     $ 217     $ (5 )

Retail Marketing

     7       20       (13 )

Chemicals

     30       12       18  

Logistics

     9       9       —    

Coke

     13       9       4  

Corporate and Other:

                        

Corporate expenses

     (16 )     (13 )     (3 )

Net financing expenses and other

     (13 )     (20 )     7  
    


 


 


Consolidated net income

   $ 242     $ 234     $ 8  
    


 


 


Net income per share of common stock (diluted)

   $ 1.75     $ 1.53     $ .22  
    


 


 


 

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SUNOCO 2Q05 EARNINGS, PAGE 7

 

Sunoco, Inc.

Earnings Profile of Sunoco Businesses (after tax)

(Millions of Dollars Except Per Share Amounts)

(Unaudited)

 

    

Six Months

Ended June 30


    Variance

 
     2005

    2004

   

Refining and Supply

   $ 320     $ 317     $ 3  

Retail Marketing

     (1 )     16       (17 )

Chemicals

     63       24       39  

Logistics

     12       17       (5 )

Coke

     23       18       5  

Corporate and Other:

                        

Corporate expenses

     (32 )     (25 )     (7 )

Net financing expenses and other

     (27 )     (44 )     17  
    


 


 


Consolidated net income

   $ 358     $ 323     $ 35  
    


 


 


Net income per share of common stock (diluted)

   $ 2.58     $ 2.12     $ .46  
    


 


 


 

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SUNOCO 2Q05 EARNINGS, PAGE 8

 

Sunoco, Inc.

Financial and Operating Statistics (Unaudited)

 

    

For the Three

Months Ended

June 30


  

For the Six

Months Ended

June 30


     2005

   2004

   2005

   2004

TOTAL REFINING AND SUPPLY

                           

Income (Millions of Dollars)

   $ 212    $ 217    $ 320    $ 317

Realized Wholesale Margin* (Per Barrel of Production Available for Sale)

   $ 7.87    $ 7.59    $ 6.92    $ 6.66

Crude Inputs as Percent of Crude Unit Rated Capacity**

     99      100      98      97

Throughputs*** (Thousand Barrels Daily):

                           

Crude Oil

     890.8      887.0      882.9      855.8

Other Feedstocks

     63.3      57.1      58.0      61.4
    

  

  

  

Total Throughputs

     954.1      944.1      940.9      917.2
    

  

  

  

Products Manufactured*** (Thousand Barrels Daily):

                           

Gasoline

     437.8      471.4      440.4      445.2

Middle Distillates

     327.3      307.0      315.9      296.1

Residual Fuel

     78.0      77.3      77.6      77.5

Petrochemicals

     38.4      40.4      38.5      36.9

Lubricants

     13.5      15.1      13.1      14.1

Other

     95.0      69.8      92.2      82.8
    

  

  

  

Total Production

     990.0      981.0      977.7      952.6

Less: Production Used as Fuel in Refinery Operations

     48.9      50.9      47.8      46.9
    

  

  

  

Total Production Available for Sale

     941.1      930.1      929.9      905.7
    

  

  

  

 

* Wholesale sales revenue less related cost of crude oil, other feedstocks, product purchases and terminalling and transportation divided by production available for sale.

 

** Effective January 1, 2005, crude unit capacity increased from 890 to 900 thousands of barrels daily due to a 10 thousand barrels-per-day adjustment in MidContinent Refining.

 

*** Data pertaining to the Eagle Point refinery for the six months ended June 30, 2004 are based on the amounts attributable to the 170-day ownership period (January 13, 2004 – June 30, 2004) divided by 182, the number of days in the period.

 

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SUNOCO 2Q05 EARNINGS, PAGE 9

 

Sunoco, Inc.

Financial and Operating Statistics (Unaudited)

 

    

For the Three

Months Ended

June 30


  

For the Six

Months Ended

June 30


     2005

   2004

   2005

   2004

Northeast Refining*

                           

Realized Wholesale Margin (Per Barrel of Production Available for Sale)

   $ 7.55    $ 7.42    $ 6.84    $ 6.59

Market Benchmark 6-3-2-1 (Per Barrel)

   $ 6.06    $ 7.67    $ 5.29    $ 7.41

Crude Inputs as Percent of Crude Unit Rated Capacity

     100      101      99      100

Throughputs** (Thousand Barrels Daily):

                           

Crude Oil

     655.1      659.5      650.6      645.2

Other Feedstocks

     56.5      52.0      51.7      55.5
    

  

  

  

Total Throughputs

     711.6      711.5      702.3      700.7
    

  

  

  

Products Manufactured** (Thousand Barrels Daily):

                           

Gasoline

     320.6      349.0      324.6      334.7

Middle Distillates

     248.5      241.9      239.7      234.2

Residual Fuel

     73.3      72.7      73.2      73.7

Petrochemicals

     29.4      32.8      29.7      31.0

Other

     65.4      41.7      61.6      53.5
    

  

  

  

Total Production

     737.2      738.1      728.8      727.1

Less: Production Used as Fuel in Refinery Operations

     36.8      38.8      36.1      36.8
    

  

  

  

Total Production Available for Sale

     700.4      699.3      692.7      690.3
    

  

  

  

 

* Comprised of the Marcus Hook, Philadelphia and Eagle Point refineries.

 

** Data pertaining to the Eagle Point refinery for the six months ended June 30, 2004 are based on the amounts attributable to the 170-day period subsequent to the January 13, 2004 acquisition date divided by 182, the number of days in the period.

 

MidContinent Refining*

Realized Wholesale Margin (Per Barrel of Production Available for Sale)

   $ 8.80    $ 8.11    $ 7.14    $ 6.88

Market Benchmark 3-2-1 (Per Barrel)

   $ 9.94    $ 10.34    $ 8.09    $ 8.36

Crude Inputs as Percent of Crude Unit Rated Capacity**

     96      97      95      90

Throughputs (Thousand Barrels Daily):

                           

Crude Oil

     235.7      227.5      232.3      210.6

Other Feedstocks

     6.8      5.1      6.3      5.9
    

  

  

  

Total Throughputs

     242.5      232.6      238.6      216.5
    

  

  

  

 

* Comprised of the Toledo and Tulsa refineries.

 

** Effective January 1, 2005, crude unit capacity increased from 235 to 245 thousands of barrels daily as a result of a 10 thousand barrels-per-day adjustment.

 

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SUNOCO 2Q05 EARNINGS, PAGE 10

 

Sunoco, Inc.

Financial and Operating Statistics (Unaudited)

 

    

For the Three
Months Ended

June 30


   

For the Six

Months Ended

June 30


 
     2005

    2004

    2005

    2004

 
MidContinent Refining (continued)                                 

Products Manufactured (Thousand Barrels Daily):

                                

Gasoline

     117.2       122.4       115.8       110.5  

Middle Distillates

     78.8       65.1       76.2       61.9  

Residual Fuel

     4.7       4.6       4.4       3.8  

Petrochemicals

     9.0       7.6       8.8       5.9  

Lubricants

     13.5       15.1       13.1       14.1  

Other

     29.6       28.1       30.6       29.3  
    


 


 


 


Total Production

     252.8       242.9       248.9       225.5  

Less: Production Used as Fuel in Refinery Operations

     12.1       12.1       11.7       10.1  
    


 


 


 


Total Production Available for Sale

     240.7       230.8       237.2       215.4  
    


 


 


 


RETAIL MARKETING                                 

Income (Loss) (Millions of Dollars)

   $ 7     $ 20     $ (1 )   $ 16  

Retail Margin* (Per Barrel):

                                

Gasoline

   $ 3.32     $ 4.50     $ 2.86     $ 3.64  

Middle Distillates

   $ 3.34     $ 3.66     $ 4.27     $ 5.04  

Sales of Petroleum Products (Thousand Barrels Daily):

                                

Gasoline

     305.4       304.7       297.6       289.2  

Middle Distillates

     42.2       40.0       45.8       42.3  
    


 


 


 


       347.6       344.7       343.4       331.5  
    


 


 


 


Total Retail Gasoline Outlets, End of Period

     4,804       4,864       4,804       4,864  

Gasoline and Diesel Throughput per Company Owned or Leased Outlet (M Gal/Site/Month)

     139       135       135       130  

Convenience Stores:

                                

Total Stores, End of Period

     742       788       742       788  

Merchandise Sales (M$/Store/Month)

   $ 81     $ 76     $ 76     $ 72  

Merchandise Margin (Company Operated) (% of Sales)

     29 %     26 %     28 %     25 %

 

* Retail sales price less related wholesale price and terminalling and transportation costs per barrel. The retail sales price is the weighted-average price received through the various branded marketing distribution channels.

 

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SUNOCO 2Q05 EARNINGS, PAGE 11

 

Sunoco, Inc.

Financial and Operating Statistics (Unaudited)

 

    

For the Three

Months Ended

June 30


  

For the Six

Months Ended

June 30


     2005

   2004

   2005

   2004

CHEMICALS

                           

Income (Millions of Dollars)

   $ 30    $ 12    $ 63    $ 24

Margin* (Cents per Pound):

                           

All Products**

     12.8      9.7      12.7      9.4

Phenol and Related Products

     12.8      8.2      11.9      8.4

Polypropylene**

     13.2      12.1      14.3      11.2

Sales (Millions of Pounds):

                           

Phenol and Related Products

     617      648      1,298      1,262

Polypropylene

     583      547      1,116      1,122

Plasticizers***

     —        —        —        28

Other

     16      43      49      91
    

  

  

  

       1,216      1,238      2,463      2,503
    

  

  

  

*       Wholesale sales revenue less cost of feedstocks, product purchases and related terminalling and transportation divided by sales volumes.

**     The polypropylene and all products margins include the impact of a long-term supply contract entered into on March 31, 2003 with Equistar Chemicals, L.P. which is priced on a cost-based formula that includes a fixed discount.

***  The plasticizer business was divested in January 2004.

COKE

                           

Income (Millions of Dollars)

   $ 13    $ 9    $ 23    $ 18

Coke Production (Thousands of Tons)

     625      493      1,128      971

Coke Sales (Thousands of Tons)

     621      491      1,118      973
    

  

  

  

 

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SUNOCO 2Q05 EARNINGS, PAGE 12

 

Sunoco, Inc.

Financial and Operating Statistics (Unaudited)

 

    

For the Three

Months Ended

June 30


   

For the Six

Months Ended

June 30


 
     2005

   2004

    2005

   2004

 

CAPITAL EXPENDITURES (Millions of Dollars)

                              

Refining and Supply

   $ 202    $ 78     $ 351    $ 148 *

Retail Marketing

     36      23 **     47      39 **

Chemicals

     10      13       28      19 *

Logistics

     11      28       19      32 *

Coke

     3      28       25      44  
    

  


 

  


     $ 262    $ 170     $ 470    $ 282  
    

  


 

  


*       Excludes $250 million acquisition from El Paso Corporation of the Eagle Point refinery and related chemical and logistics assets, which includes inventory. The purchase price is comprised of $190, $40 and $20 million attributable to Refining and Supply, Chemicals and Logistics, respectively.

           

**     Excludes $181 million acquisition from ConocoPhillips of 340 retail outlets located primarily in Delaware, Maryland, Virginia and Washington, D.C., which includes inventory.

        

DEPRECIATION, DEPLETION AND

AMORTIZATION (Millions of Dollars)

                              

Refining and Supply

   $ 47    $ 44     $ 96    $ 92  

Retail Marketing

     25      28       52      53  

Chemicals

     17      17       35      34  

Logistics

     8      7       16      14  

Coke

     5      4       8      7  
    

  


 

  


     $ 102    $ 100     $ 207    $ 200  
    

  


 

  


 

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SUNOCO 2Q05 EARNINGS, PAGE 13

 

Sunoco, Inc.

Earnings Profile of Sunoco Businesses (after tax)

(Millions of Dollars Except Per Share Amounts)

(Unaudited)

 

     2004

 
     1st

    2nd

    3rd

    4th

    Total

 

Refining and Supply

   $ 100     $ 217     $ 89     $ 135     $ 541  

Retail Marketing

     (4 )     20       22       30       68  

Chemicals

     12       12       30       40       94  

Logistics

     8       9       9       5       31  

Coke

     9       9       12       10       40  

Corporate and Other:

                                        

Corporate expenses

     (12 )     (13 )     (15 )     (27 )     (67 )

Net financing expenses and other

     (24 )     (20 )     (19 )     (15 )     (78 )
    


 


 


 


 


       89       234       128       178       629  

Special items

     —         —         (24 )     —         (24 )
    


 


 


 


 


Consolidated net income

   $ 89     $ 234     $ 104     $ 178     $ 605  
    


 


 


 


 


Earnings (loss) per share of common stock (diluted):

                                        

Income before special items

   $ .58     $ 1.53     $ .85     $ 1.24     $ 4.20  

Special items

     —         —         (.16 )     —         (.16 )
    


 


 


 


 


Net income

   $ .58     $ 1.53     $ .69     $ 1.24     $ 4.04  
    


 


 


 


 


 

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SUNOCO 2Q05 EARNINGS, PAGE 14

 

Sunoco, Inc.

Earnings Profile of Sunoco Businesses (after tax)

(Millions of Dollars Except Per Share Amounts)

(Unaudited)

 

     2005

 
     1st

    2nd

 

Refining and Supply

   $ 108     $ 212  

Retail Marketing

     (8 )     7  

Chemicals

     33       30  

Logistics

     3       9  

Coke

     10       13  

Corporate and Other:

                

Corporate expenses

     (16 )     (16 )

Net financing expenses and other

     (14 )     (13 )
    


 


       116       242  

Special items

     —         —    
    


 


Consolidated net income

   $ 116     $ 242  
    


 


Earnings per share of common stock (diluted):

                

Income before special items

   $ .83     $ 1.75  

Special items

     —         —    
    


 


Net income

   $ .83     $ 1.75  
    


 


 

- more -


SUNOCO 1Q05 EARNINGS, PAGE 15

 

Sunoco, Inc.

Consolidated Statements of Income

(Millions of Dollars)

(Unaudited)

 

     2004

 
     1st

    2nd

    3rd

    4th

    Total

 

REVENUES

                                        

Sales and other operating revenue (including consumer excise taxes)

   $ 5,232     $ 6,265     $ 6,575     $ 7,396     $ 25,468  

Interest income

     2       1       4       3       10  

Other income (loss), net

     11       10       (21 )     30       30  
    


 


 


 


 


       5,245       6,276       6,558       7,429       25,508  
    


 


 


 


 


COSTS AND EXPENSES

                                        

Cost of products sold and operating expenses

     4,254       4,949       5,417       6,114       20,734  

Consumer excise taxes

     498       571       611       602       2,282  

Selling, general and administrative expenses

     187       223       203       260       873  

Depreciation, depletion and amortization

     100       100       103       106       409  

Payroll, property and other taxes

     33       28       30       27       118  

Interest cost and debt expense

     29       28       28       23       108  

Interest capitalized

     (1 )     (2 )     (3 )     (5 )     (11 )
    


 


 


 


 


       5,100       5,897       6,389       7,127       24,513  

Income before income tax expense

     145       379       169       302       995  

Income tax expense

     56       145       65       124       390  
    


 


 


 


 


Net income

   $ 89     $ 234     $ 104     $ 178     $ 605  
    


 


 


 


 


 

- more -


SUNOCO 1Q05 EARNINGS, PAGE 16

 

Sunoco, Inc.

Consolidated Statements of Income

(Millions of Dollars)

(Unaudited)

 

     2005

 
     1st

    2nd

 

REVENUES

                

Sales and other operating revenue (including consumer excise taxes)

   $ 7,191     $ 7,970  

Interest income

     3       3  

Other income, net

     15       17  
    


 


       7,209       7,990  
    


 


COSTS AND EXPENSES

                

Cost of products sold and operating expenses

     6,059       6,581  

Consumer excise taxes

     585       640  

Selling, general and administrative expenses

     209       225  

Depreciation, depletion and amortization

     105       102  

Payroll, property and other taxes

     36       28  

Interest cost and debt expense

     23       23  

Interest capitalized

     (6 )     (6 )
    


 


       7,011       7,593  

Income before income tax expense

     198       397  

Income tax expense

     82       155  
    


 


Net income

   $ 116     $ 242  
    


 


 

- more -


SUNOCO 1Q05 EARNINGS, PAGE 17

 

Sunoco, Inc.

Consolidated Balance Sheets

(Millions of Dollars)

(Unaudited)

 

    

At

June 30

2005


  

At

December 31

2004


ASSETS

             

Current Assets

             

Cash and cash equivalents

   $ 417    $ 405

Accounts and notes receivable, net

     1,703      1,271

Inventories

     987      765

Deferred income taxes

     110      110
    

  

Total Current Assets

     3,217      2,551

Investments and long-term receivables

     111      115

Properties, plants and equipment, net

     5,239      4,966

Prepaid retirement costs

     12      11

Deferred charges and other assets

     445      436
    

  

Total Assets

   $ 9,024    $ 8,079
    

  

LIABILITIES AND SHAREHOLDERS’ EQUITY

             

Current Liabilities

             

Accounts payable and accrued liabilities

   $ 3,161    $ 2,570

Short-term borrowings and current portion of long-term debt

     103      103

Taxes payable

     336      349
    

  

Total Current Liabilities

     3,600      3,022

Long-term debt

     1,366      1,379

Retirement benefit liabilities

     534      539

Deferred income taxes

     781      755

Other deferred credits and liabilities

     322      247

Minority interests

     619      530

Shareholders’ equity

     1,802      1,607
    

  

Total Liabilities and Shareholders’ Equity

   $ 9,024    $ 8,079
    

  

 

- more -


SUNOCO 1Q05 EARNINGS, PAGE 18

 

Sunoco, Inc.

Consolidated Statements of Cash Flows

(Millions of Dollars)

(Unaudited)

 

    

For the Six Months

Ended June 30


 
     2005

    2004

 

INCREASES (DECREASES) IN CASH AND CASH EQUIVALENTS

                

CASH FLOWS FROM OPERATING ACTIVITIES:

                

Net income

   $ 358     $ 323  

Adjustments to reconcile net income to net cash provided by operating activities:

                

Depreciation, depletion and amortization

     207       200  

Deferred income tax expense

     25       105  

Proceeds from power contract restructuring

     48       —    

Payments in excess of expense for retirement plans

     (5 )     —    

Changes in working capital pertaining to operating activities, net of effect of acquisitions

     (74 )     58  

Other

     12       (7 )
    


 


Net cash provided by operating activities

     571       679  
    


 


CASH FLOWS FROM INVESTING ACTIVITIES:

                

Capital expenditures

     (470 )     (282 )

Acquisitions

     —         (416 )

Proceeds from divestments

     21       111  

Other

     5       9  
    


 


Net cash used in investing activities

     (444 )     (578 )
    


 


CASH FLOWS FROM FINANCING ACTIVITIES:

                

Net proceeds from short-term borrowings

     —         100  

Repayments of long-term debt

     (13 )     (108 )

Net proceeds from issuance of Sunoco Logistics Partners L.P. limited partnership units

     99       129  

Cash distributions to investors in cokemaking operations

     (11 )     (27 )

Cash distributions to investors in Sunoco Logistics Partners L.P.

     (12 )     (8 )

Cash dividend payments

     (48 )     (42 )

Purchases of common stock for treasury

     (131 )     (65 )

Proceeds from issuance of common stock under management incentive and employee option plans

     6       28  

Other

     (5 )     (4 )
    


 


Net cash provided by (used in) financing activities

     (115 )     3  
    


 


Net increase in cash and cash equivalents

     12       104  

Cash and cash equivalents at beginning of period

     405       431  
    


 


Cash and cash equivalents at end of period

   $ 417     $ 535  
    


 


 

-END OF SUNOCO 2Q05 EARNINGS REPORT-