content: <PAGE>
                                    UNITED STATES
                           SECURITIES AND EXCHANGE COMMISSION
                                 Washington, D.C. 20549
                    ------------------------------------------------
                                      FORM 10-Q
             (Mark One)
  
              X     QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
             ---        OF THE SECURITIES EXCHANGE ACT OF 1934
  
                     For the quarterly period ended September 30, 2000
                                         OR
             ---    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
                        OF THE SECURITIES EXCHANGE ACT OF 1934
                    ------------------------------------------------
  
                 For the transition period from ________ to _________
  
                             Commission file number 1-8142
  
                                ENGELHARD CORPORATION
                ------------------------------------------------------
                (Exact name of Registrant as specified in its charter)
  
                  DELAWARE                            22-1586002
       -------------------------------       -------------------------------
       (State or other jurisdiction of       (I.R.S. Employer Identification
       incorporation or organization)         No.)
  
       101 WOOD AVENUE, ISELIN, NEW JERSEY                  08830
       ----------------------------------------       -----------------
       (Address of principal executive offices)           (Zip Code)
  
                                   (732) 205-5000
                  ----------------------------------------------------
                  (Registrant's telephone number, including area code)
  
                                   Not Applicable
                  ---------------------------------------------------
                  (Former name, former address and former fiscal year,
                              if changed since last report)
  
       Indicate by check mark whether the Registrant (1) has filed all reports
  required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of
  1934 during the preceding 12 months (or for such shorter period that the
  Registrant was required to file such reports), and (2) has been subject to such
  filing requirements for the past 90 days.
  
                              Yes   X       No
                                   ---          ---
  
  Indicate the number of shares  outstanding  of each of the  issuer's  classes of
  common stock, as of the latest practicable date.
  
  Class of Common Stock                        Outstanding at October 31, 2000
  ---------------------                        -------------------------------
      $1 par value                                      127,779,536
  
                                          1
  <PAGE>
                           PART I - FINANCIAL INFORMATION
  
  Item 1 - Financial Statements
  
                                ENGELHARD CORPORATION
                    CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS
                          (Thousands, except per share data)
                                     (Unaudited)
  
                                    Three Months Ended       Nine Months Ended
                                      September 30,            September 30,
                                 ------------------------  ----------------------
                                     2000        1999         2000        1999
                                 -----------  -----------  ----------  ----------
  Net sales .................... $1,374,350   $1,016,242   $3,937,325  $3,292,209
  Cost of sales ................  1,207,698      865,665    3,394,618   2,824,149
                                 -----------  -----------  ----------  ----------
  
       Gross profit ............    166,652      150,577      542,707     468,060
  
  Selling, administrative and
    other expenses .............     79,308       69,428      258,807     232,358
                                 -----------  -----------   ---------   ---------
  
       Operating earnings ......     87,344       81,149      283,900     235,702
  
  Equity in earnings of
    affiliates .................      5,031        4,192       19,428      11,995
  Gain/(loss) on disposal of
    investments and land .......        170        2,911       (5,830)      8,592
  Interest expense, net ........    (15,001)     (14,869)     (47,867)    (43,735)
                                 -----------  -----------   ----------  ----------
  
       Earnings before income
         taxes .................     77,544       73,383      249,631     212,554
  
  Income tax expense ...........     26,210       22,382       80,417      64,829
                                 -----------  -----------   ----------  ----------
  
       Net earnings ............ $   51,334   $   51,001    $ 169,214   $ 147,725
                                 ===========  ===========   ==========  ==========
  
  Basic earnings per share ..... $     0.41   $     0.41    $    1.34   $    1.10
                                 ===========  ===========   ==========  ==========
  
  Diluted earnings per share ... $     0.40   $     0.40    $    1.32   $    1.08
                                 ===========  ===========  =========== ===========
  
  Cash dividends per share       $     0.10   $     0.10    $    0.30   $    0.30
                                 ===========  ===========  =========== ===========
  Average number of shares
    outstanding - Basic ........    126,451      125,921      126,281     134,642
                                 ===========  ===========  =========== ===========
  Average number of shares
    outstanding - Diluted ......    128,368      128,592      127,983     136,914
                                 ===========  ===========  =========== ===========
  
         See the Accompanying Notes to the Unaudited Condensed Consolidated
                                Financial Statements
  
  
  
  
                                          2
  <PAGE>
  
                                ENGELHARD CORPORATION
                        CONDENSED CONSOLIDATED BALANCE SHEETS
                                     (Thousands)
                                     (Unaudited)
  
  
  
  
                                                     September 30,  December 31,
                                                         2000           1999
                                                     ------------   ------------
  
  Cash .............................................  $   35,364     $   54,375
  Receivables, net..................................     438,954        394,338
  Committed metal positions ........................   1,320,904        467,768
  Inventories ......................................     373,736        359,153
  Other current assets .............................      98,647        121,672
                                                      ----------     ----------
         Total current assets ......................   2,267,605      1,397,306
  
  Investments ......................................     195,711        182,184
  Property, plant and equipment, net ...............     830,558        871,900
  Intangible assets, net ...........................     311,617        325,544
  Other noncurrent assets ..........................     111,390        143,590
                                                      ----------     ----------
         Total assets ..............................  $3,716,881     $2,920,524
                                                      ==========     ==========
  
  
  Short-term borrowings ............................  $  521,618     $  452,029
  Accounts payable .................................     912,335        246,016
  Hedged metal obligations .........................     592,211        497,800
  Other current liabilities ........................     281,418        268,978
                                                      ----------     ----------
         Total current liabilities .................   2,307,582      1,464,823
  
  Long-term debt ...................................     322,111        499,466
  Other noncurrent liabilities .....................     186,627        191,845
  Shareholders' equity .............................     900,561        764,390
                                                      ----------     ----------
         Total liabilities and
           shareholders' equity ....................  $3,716,881     $2,920,524
                                                      ==========     ==========
  
  
  
  
       See the Accompanying Notes to the Unaudited Condensed Consolidated
                              Financial Statements
  
  
  
  
  
  
  
  
                                          3
  <PAGE>
                                ENGELHARD CORPORATION
                   CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                     (Thousands)
                                     (Unaudited)
  
                                                              Nine Months Ended
                                                                September 30,
                                                             --------------------
                                                                2000       1999
                                                             ---------   --------
  Cash flows from operating activities
       Net earnings ........................................ $169,214   $ 147,725
       Adjustments to reconcile net earnings to net cash
       provided by operating activities
            Depreciation and depletion .....................   77,258      72,519
            Amortization of intangible assets ..............    8,404       9,773
            Loss/(gain) on disposal of investments and land.    5,830      (8,592)
            Equity results, net of dividends ...............  (15,064)     (9,564)
            Net change in assets and liabilities
                 Metal related .............................  (84,982)    171,766
                 All other .................................  (45,006)    (51,431)
                                                             ---------   ---------
  
            Net cash provided by operating activities.......  115,654     332,196
                                                             ---------   ---------
  Cash flows from investing activities
       Capital expenditures ................................  (76,060)    (61,519)
       Proceeds from disposal of investments and land.......   52,811      10,449
       Acquisitions and other investments ..................  (40,095)     (1,230)
       Other ...............................................        -       2,408
                                                             ---------- ----------
  
            Net cash used in investing activities ..........  (63,344)    (49,892)
                                                             ---------   ---------
  
  Cash flows from financing activities
       Increase in short-term borrowings....................   19,529     203,673
       Increase/(decrease) in hedged metal obligations......   33,165    (184,192)
       Proceeds from issuance of long-term debt ............        -      45,894
       Repayment of long-term debt ......................... (103,703)     (3,784)
       Purchase of treasury stock ..........................        -    (296,076)
       Stock bonus and option plan transactions ............    7,641      10,732
       Dividends paid ......................................  (25,525)    (39,936)
                                                             ---------   ---------
  
            Net cash used in financing activities...........  (68,893)   (263,689)
  
  Effect of exchange rate changes on cash ..................   (2,428)     (2,296)
                                                             ---------   ---------
            Net (decrease)/increase in cash ................  (19,011)     16,319
            Cash at beginning of year ......................   54,375      22,339
                                                             ---------   ---------
  
            Cash at end of period........................... $ 35,364     $38,658
                                                             =========   =========
  
  
       See the Accompanying Notes to the Unaudited Condensed Consolidated
                               Financial Statements
  
  
                                          4
  <PAGE>
                                ENGELHARD CORPORATION
                            BUSINESS SEGMENT INFORMATION
                                     (Thousands)
                                     (Unaudited)
  
  
                                     Three Months Ended       Nine Months Ended
                                        September 30,           September 30,
                                  -----------------------  -----------------------
                                       2000        1999        2000        1999
  Net Sales                       ------------ ----------  -----------  ----------
   Environmental Technologies ..  $  164,621  $  141,195   $  493,190  $  440,900
   Process Technologies ........     145,877     110,369      388,381     349,169
   Specialty Pigments and
     Additives .................      92,875      91,298      284,342     274,281
   Paper Pigments and Additives.      65,280      61,802      179,919     177,894
   Industrial Commodities
     Management ................     897,286     594,000    2,565,790   1,975,966
                                  ----------- -----------  ----------- -----------
         Reportable segments ...   1,365,939     998,664    3,911,622   3,218,210
  
   All other ...................       8,411      17,578       25,703      73,999
                                  ----------- -----------  ----------- -----------
                                  $1,374,350  $1,016,242   $3,937,325  $3,292,209
                                  =========== ===========  =========== ===========
  
  Operating Earnings
   Environmental Technologies ... $   35,552  $   24,361   $  101,381  $   80,348
   Process Technologies .........     19,495      18,784       54,433      52,736
   Specialty Pigments and
     Additives ..................     17,014      15,145       52,887      46,384
   Paper Pigments and Additives..      5,168       5,228       10,597      21,081
   Industrial Commodities
     Management .................     14,301       9,372       77,634      29,569
                                  ----------- -----------  ----------- -----------
         Reportable segments ...      91,530      72,890      296,932     230,118
  
    All other ...................     (4,186)      8,259      (13,032)      5,584
                                  ----------- -----------  ----------- -----------
                                      87,344      81,149      283,900     235,702
  
  Equity in earnings of
    affiliates .................       5,031       4,192       19,428      11,995
  Gain/(loss) on disposal of
    investments and land .......         170       2,911       (5,830)      8,592
  Interest expense, net ........     (15,001)    (14,869)     (47,867)    (43,735)
                                  ----------- -----------  ----------- -----------
         Earnings before income
           taxes ...............  $   77,544  $   73,383   $  249,631  $  212,554
  
  Income tax expense ...........      26,210      22,382       80,417      64,829
                                  ----------- -----------  ----------- -----------
         Net earnings ..........  $   51,334  $   51,001   $  169,214  $  147,725
                                  =========== ===========  =========== ===========
  
  
       See the Accompanying Notes to the Unaudited Condensed Consolidated
                              Financial Statements
  
                                          5
  <PAGE>
  
  Notes to the Unaudited Condensed Consolidated Financial Statements
  ------------------------------------------------------------------
  
  Note 1 - Basis of Presentation
  ------------------------------
  
       The unaudited condensed consolidated financial statements of Engelhard
  Corporation and subsidiaries (the "Company") contain all adjustments, which, in
  the opinion of management, are necessary for a fair statement of the results for
  the interim periods presented. The financial statement results for interim
  periods are not necessarily indicative of financial results for the full year.
  These financial statements should be read in conjunction with the consolidated
  financial statements and notes thereto included in the Company's 1999 Annual
  Report to Shareholders. Certain prior-year amounts have been reclassified
  to conform with the current-year presentation.
  
  Note 2 - Inventories
  --------------------
  
  Inventories consist of the following (in thousands):
  
                                      September 30, 2000      December 31, 1999
                                      ------------------      -----------------
  
  Raw materials .....................      $ 87,741              $ 84,165
  Work in process ...................        67,723                52,954
  Finished goods ....................       191,533               195,731
  Precious metals ...................        26,739                26,303
                                           --------              --------
  Total inventories .................      $373,736              $359,153
                                           ========              ========
  
       All precious metals included in inventories are stated at LIFO cost. The
  market value of the precious metals inventories exceeded cost by $198.8 million
  and $115.3 million at September 30, 2000 and December 31, 1999, respectively.
  
  Note 3 - Comprehensive Income
  -----------------------------
  
  Comprehensive income is summarized as follows (in thousands):
  
                                    Three Months Ended      Nine Months Ended
                                       September 30,          September 30,
                                    ------------------    ----------------------
                                     2000       1999         2000         1999
                                    --------  -------     ---------     --------
  Net earnings .................    $51,334   $51,001     $169,214      $147,725
  Other comprehensive income/(loss):
     Foreign currency
      translation adjustment         (4,512)   16,116       (5,431)        1,486
                                    -------   -------     ---------     --------
  Comprehensive income .........    $46,822   $67,117     $163,783      $149,211
                                    =======   =======     =========     ========
  
       No provision has been made for U.S. or additional foreign taxes on the
  undistributed earnings of foreign subsidiaries because such earnings are
  expected to be reinvested indefinitely in the subsidiaries' operations.
  
                                          6
  <PAGE>
  
  Note 4 - Earnings Per Share
  ---------------------------
  
  The following table represents the computation of basic and diluted earnings per
  share:
  
  
                                         Three Months Ended   Nine Months Ended
                                           September 30,       September 30,
                                         ------------------   -----------------
  (in thousands, except per share data)    2000      1999       2000      1999
  -------------------------------------  --------  --------   --------  --------
  
  Basic EPS Computation
  ---------------------
  Net earnings applicable to common
    shares                               $ 51,334  $ 51,001   $169,214  $147,725
                                         --------  --------   --------  --------
  Average number of shares
   outstanding - basic                    126,451   125,921    126,281   134,642
                                         --------  --------   --------  --------
  Basic earnings per share               $   0.41  $   0.41   $   1.34  $   1.10
                                         ========  ========   ========  ========
  
  Diluted EPS Computation
  -----------------------
  Net earnings applicable to common
    shares                               $ 51,334  $ 51,001   $169,214  $147,725
                                         --------  --------   --------  --------
  Average number of shares
   outstanding - basic                    126,451   125,921    126,281   134,642
  Effect of dilutive stock options
   and other incentives                       669     1,336        454       937
  Effect of Rabbi Trust                     1,248     1,335      1,248     1,335
                                         --------  --------   --------  --------
  Average number of shares
   outstanding - diluted                  128,368   128,592    127,983   136,914
                                         --------  --------   --------  --------
  Diluted earnings per share             $   0.40  $   0.40   $   1.32  $   1.08
                                         ========  ========   ========  ========
  
  
  Note 5 - Disposal of Investments and Land
  -----------------------------------------
  
       In the third quarter of 2000, the Company sold it's metal joining products
  business located in Warwick, Rhode Island. This business is a leading
  manufacturer of brazing alloys and fluxes, as well as a supplier of lead-free
  solder, serving metal-joining industries such as plumbing, electronics,
  lighting, shipbuilding and aerospace. The Company recorded a gain of $24.8
  million ($15.2 million after tax or $0.12 per share on a diluted basis) which
  was recorded in "Gain/(loss) on disposal of investments and land" in the
  Company's Condensed Consolidated Statements of Earnings. Net cash proceeds
  received were $41.8 million. In 1999, this business had approximately $49
  million in annual revenue and was reported in the Company's Environmental
  Technologies Segment.
  
  
  
  
                                          7
  <PAGE>
  
  
  
       In accordance with SFAS No. 121, "Accounting for the Impairment of
  Long-Lived Assets and for Long-Lived Assets to Be Disposed Of," the Company
  evaluated the recoverability of the long-lived assets, including goodwill, of
  its HexCore business unit. This business unit manufactures and markets
  desiccant-coated rotors and related products, and is reported in the Company's
  "All Other" segment. As part of the Company's annual budgeting process, it was
  determined that HexCore's estimated future undiscounted cash flows were below
  the carrying value of its assets, primarily due to the loss of a major customer
  in August 2000. Accordingly, during the third quarter of 2000, the Company
  adjusted the carrying value of HexCore's long-lived assets and goodwill to their
  estimated fair values. The resulting impairment charge was approximately $24.6
  million ($16.9 million after-tax or $0.13 per share on a diluted basis) and was
  recorded in "Gain/(loss) on disposal of investments and land" in the Company's
  Condensed Consolidated Statements of Earnings. The impairment charge consisted
  of a write-down of goodwill of $21.9 million and fixed assets of $2.7 million.
  The estimated fair value was based on anticipated future cash flows discounted
  at a rate commensurate with the Company's estimated cost of capital.
  
  
  Note 6 - Acquisitions
  ---------------------
  
       In September 2000, the Company acquired a polyolefin catalyst business
  located in Tarragona, Spain from Targor GmbH, a subsidiary of BASF AG, for
  approximately $35 million. As part of the acquisition, the Company obtained a
  supply agreement to become the exclusive supplier of polyolefin catalysts to
  Novolen Technology Holdings C.V. This acquisition was recorded under the
  purchase method of accounting, and accordingly, the results of operations of
  this acquisition have been included in the accompanying consolidated financial
  statements from the date of acquisition. A portion of the purchase price has
  been allocated to assets acquired and liabilities assumed based on their fair
  values, while the remaining balance was recorded as an intangible asset and is
  being amortized over 15 years. Pro forma information is not provided since the
  impact of the acquisition does not have a material effect on the Company's
  results of operations, cash flows or financial position.
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
                                          8
  <PAGE>
  
  Note 7 - New Accounting Pronouncements
  --------------------------------------
  
       In June 1998, the Financial Accounting Standards Board (FASB) issued
  Statement of Financial Accounting Standards No. 133, "Accounting for Derivative
  Instruments and Hedging Activities" ("SFAS 133"). In June 1999, the FASB issued
  SFAS No. 137, "Accounting for Derivative Instruments and Hedging Activities -
  Deferral of the Effective Date of FASB Statement No. 133". SFAS No. 137 delayed
  the required adoption of SFAS No. 133 to all fiscal quarters of all fiscal years
  beginning after June 15, 2000. In June 2000, the FASB issued SFAS No. 138,
  "Accounting for Certain Derivative Instruments and Certain Hedging Activities
  (an amendment of FASB Statement No. 133). These standards require that all
  derivative instruments be recorded on the balance sheet at their fair value.
  Changes in the fair value of derivatives are recorded each period in earnings or
  comprehensive income, depending on the designation of the derivative.
  
       The Company will adopt these statements in the first quarter of 2001 and
  does not expect them to have a material effect on the Company's results of
  operations, financial position, cash flows or equity.
  
  
  
  Note 8 - Other Matters
   ----------------------
  
       In 1998, Management learned that Engelhard and several other companies
  operating in Japan had been victims of a fraudulent scheme involving base-metal
  inventory held in third-party warehouses in Japan.  The inventory loss was
  approximately $40 million in 1997 and $20 million in 1998.  The Company is
  vigorously pursuing various recovery actions.  These actions include
  negotiations with the various third parties involved and, in several instances,
  the commencement of litigation.  In the first quarter of 1998, Engelhard
  recorded a receivable from the insurance carriers and third parties involved
  for approximately $20 million.  This amount represents Management's and
  counsel's best estimate of the minimum probable recovery from the various
  insurance policies and other parties involved in the fraudulent scheme.
  
       The Company is involved in a value-added tax dispute in Peru, which
  Management believes has a maximum economic exposure of approximately $30
  million. On December 2, 1999, Engelhard Peru, S.A., a wholly owned subsidiary,
  was denied refund claims of approximately $28 million. The Peruvian tax
  authority also determined that Engelhard Peru, S.A. is liable for approximately
  $63 million in refunds previously paid, fines and interest as of December 31,
  1999. Interest and fines continue to accrue at rates established by Peruvian
  law. Engelhard Peru, S.A. is contesting these determinations vigorously, and
  Management believes, based on consultation with counsel, that Engelhard Peru,
  S.A. is entitled to all refunds claimed and is not liable for these additional
  taxes, fines or interest. In late October 2000, a criminal proceeding alleging
  tax fraud and forgery related to this value-added tax dispute was initiated
  against two Lima based officials of Engelhard Peru, S.A. Although Engelhard
  Peru, S.A. is not a defendant, it may be civilly liable for criminal conduct of
  its representatives and Engelhard Peru is assisting in the vigorous defense of
  this proceeding. Management believes the maximum economic exposure is limited to
  the aggregate value of all assets of Engelhard Peru, S.A., including unpaid
  refunds, which is approximately $30 million.
  
  
  
  
  
                                          9
  <PAGE>
  
  
            Management's Discussion and Analysis of
  Item 2.   Financial Condition and Results of Operations
  -------   ---------------------------------------------
  
                                Results of Operations
                                ---------------------
  
  Comparison of the Third Quarter of 2000
  with the Third Quarter of 1999
  ----------------------------------------
  
       Net earnings increased 1% to $51.3 million in the third quarter of 2000
  from $51.0 million in the same period of 1999. Operating earnings for the third
  quarter of 2000 increased 8% to $87.3 million from $81.1 million in the same
  period of 1999. Higher operating earnings were reported in four of the Company's
  five reportable segments -- Environmental Technologies, Process Technologies,
  Specialty Pigments and Additives and Industrial Commodities Management.
  Operating earnings from the Paper Pigments and Additives segment were
  essentially flat from the same period of 1999.
  
       The effective tax rate was 33.8% in the third quarter of 2000 compared with
  30.5% for the same period last year. The higher effective rate was primarily
  driven by a lower estimated tax basis in the HexCore assets written off in the
  third quarter of 2000.
  
       The Company's share of earnings from affiliates increased 20% to $5.0
  million in the third quarter of 2000 compared with $4.2 million for the same
  period in 1999. Higher equity earnings were primarily from Heesung Engelhard, an
  environmental catalyst joint venture.
  
       Net interest expense increased 1% to $15.0 million in the third quarter of
  2000 from $14.9 million in the same period of 1999. In the third quarter of
  1999, net interest expense included $3.0 million of income resulting from the
  settlement of treasury lock positions. Excluding this income, net interest
  expense would have decreased 16% primarily due to decreased borrowings,
  partially offset by an increase in interest rates.
  
       Net sales increased 35% to $1.4 billion in the third quarter of 2000 from
  $1.0 billion for the same period of 1999. Higher sales were reported in all five
  of the Company's reportable segments.
  
  
  
  
  
  
  
  
  
  
  
  
                                         10
  <PAGE>
  
  Environmental Technologies
  --------------------------
  
       Operating earnings increased 46% to $35.6 million in the third quarter of
  2000 from $24.4 million in the same period of 1999. Net sales for the third
  quarter of 2000 increased 17% to $164.6 million from $141.2 million in the same
  period of 1999.
  
       The majority of this segment's sales and operating earnings are derived
  from technologies to control pollution from mobile sources, including gasoline
  and diesel-powered passenger cars, sport-utility vehicles, trucks, buses and
  off-road vehicles. Earnings increased in North America, primarily as a result of
  increased volumes for auto-emission catalysts. Foreign earnings increased due to
  an improved product mix resulting from the introduction of advanced technologies
  concurrent with the new model year.
  
       Earnings in the segment's non-automotive markets also increased due to
  significantly higher sales of stationary emission systems for gas turbines.
  
  
  Process Technologies
  --------------------
  
       Operating earnings increased 4% to $19.5 million in the third quarter of
  2000 from $18.8 million in the same period of 1999. Net sales for third quarter
  of 2000 increased 32% to $145.9 million from $110.4 million in the same period
  of 1999.
  
       Earnings growth from chemical catalysts was partially offset by a decline
  in earnings from petroleum catalysts and polypropylene catalysts.
  
       Earnings from chemical catalysts increased primarily due to increased
  volumes compared with a relatively weak year ago quarter. Earnings were also
  favorably impacted by the third quarter shipment of orders that were delayed
  from the first half of this year. Higher revenues of chemical catalysts
  reflected higher precious metal prices this year.
  
       Earnings from petroleum catalysts decreased as the effect of increased
  volumes from fluid cracking catalysts were offset by an unfavorable product mix
  and higher energy costs. Earnings from polypropylene catalysts decreased as
  increased volumes were offset by an unfavorable product mix and increased
  operating expenses.
  
  Specialty Pigments and Additives
  --------------------------------
  
       Operating earnings increased 12% to $17.0 million in the third quarter of
  2000 from $15.1 million in the same period of 1999.  Net sales for the third
  quarter of 2000 increased 2% to $92.9 million from $91.3 million in the same
  period of 1999.
  
       Earnings increased primarily due to increased volumes of effect pigments to
  industrial and cosmetics markets. In addition, lower production costs of color
  pigments had a favorable impact on earnings. These increased results were
  partially offset by decreased earnings of performance additives primarily
  resulting from higher energy costs.
  
  
                                         11
  
  <PAGE>
  
  Paper Pigments and Additives
  ----------------------------
  
       Operating earnings of $5.2 million for the third quarter of 2000 were
  essentially flat compared with the same period of 1999. Net sales for the third
  quarter of 2000 increased 6% to $65.3 million from $61.8 million in the same
  period of 1999.
  
       Earnings were essentially flat with the same period of 1999 as increased
  volumes were offset by higher energy costs and lower selling prices.
  
  Industrial Commodities Management
  ---------------------------------
  
       Operating earnings increased 53% to $14.3 million in the third quarter of
  2000 from $9.4 million in the same period of 1999. Net sales for the third
  quarter of 2000 increased 51% to $897.3 million from $594.0 million in the same
  period of 1999.
  
       The sales increase resulted from higher prices and the continued strong
  demand for platinum group metals. The operating earnings increase resulted from
  significantly higher volatility in platinum group metals.
  
  
  Comparison of the First Nine Months of 2000
  with the First Nine Months of 1999
  ------------------------------------------
  
       Net earnings increased 15% to $169.2 million in the first nine months of
  2000 from $147.7 million in the same period of 1999. Operating earnings for the
  first nine months of 2000 increased 20% to $283.9 million from $235.7 million in
  the same period of 1999. Four of the Company's five reportable segments reported
  increased operating earnings -- Environmental Technologies, Process
  Technologies, Specialty Pigments and Additives and Industrial Commodities
  Management.
  
       The effective tax rate was 32.2% in the first nine months of 2000 compared
  with 30.5% for the same period last year. The higher effective rate was driven
  by a lower estimated tax basis in the HexCore assets written off in the third
  quarter of 2000. In addition, the higher effective rate was due to a shift in
  the geographic mix of earnings and a changing product slate.
  
       The Company's share of earnings from affiliates increased 62% to $19.4
  million in the first nine months of 2000 from $12.0 million for the same period
  in 1999. The increase was primarily due to higher equity earnings from
  Engelhard-CLAL, a precious-metal-fabrication joint venture. The Company's share
  of earnings from Engelhard-CLAL included a gain of $6.7 million related to the
  partial liquidation of precious metal inventories. Higher equity earnings were
  also reported for Heesung Engelhard, an environmental catalyst joint venture.
  
       Net interest expense increased 9% to $47.9 million for the first nine
  months of 2000 from $43.7 million for the same period in 1999. For the nine
  month period ended September 30, 1999, net interest expense included $4.2
  million of income resulting from the settlement of treasury lock positions.
  Excluding this income, net interest expense would have been flat compared with
  the same period of 1999.
  
                                         12
  <PAGE>
  
       Net sales increased 20% to $3.9 billion in the first nine months of 2000
  from $3.3 billion in the same period in 1999. Higher sales were reported in all
  five of the Company's reportable segments. Sales reported in the "All Other"
  segment decreased primarily as the Company sold its metal plating business in
  the second quarter of 1999.
  
  Environmental Technologies
  --------------------------
  
       Operating earnings increased 26% to $101.4 million in the first nine months
  of 2000 from $80.3 million in the same period of 1999. Net sales for the first
  nine months of 2000 increased 12% to $493.2 million from $440.9 million in the
  same period of 1999.
  
       The majority of this segment's sales and operating earnings are derived
  from technologies to control pollution from mobile sources, including gasoline
  and diesel-powered passenger cars, sport-utility vehicles, trucks, buses and
  off-road vehicles. Earnings increased primarily from strength in auto-emission
  catalysts in both North America and Europe.
  
       Sales in the segment's non-automotive markets increased due to higher
  volumes of heavy-duty deisel-engine retrofits and stationary emission systems
  for gas turbines. Earnings in the non-automotive markets declined slightly as
  the effect of higher volumes were offset by higher research and administrative
  costs.
  
       The segment's earnings increases were partially offset by costs related to
  the start-up of new manufacturing facilities in Brazil and China, plus the
  expansion of a facility in India.
  
  Process Technologies
  --------------------
  
       Operating earnings increased 3% to $54.4 million in the first nine months
  of 2000 from $52.7 million in the same period of 1999. Net sales for the first
  nine months of 2000 increased 11% to $388.4 million from $349.2 million in the
  same period of 1999.
  
       Earnings growth from petroleum catalysts and polypropylene catalysts was
  offset by a decline in earnings from chemical catalysts.
  
       Earnings from petroleum catalysts increased primarily due to increased
  volumes from fluid cracking catalysts and reduced costs from
  supply-chain-management initiatives and productivity improvements, partially
  offset by increased energy costs. Earnings from polypropylene catalysts
  increased primarily from increased volumes.
  
       Earnings from chemical catalysts decreased as the effect of increased
  volumes were offset by higher manufacturing costs and an unfavorable foreign
  currency translation.
  
  
  
  
  
  
                                         13
  <PAGE>
  
  Specialty Pigments and Additives
  --------------------------------
  
       Operating earnings increased 14% to $52.9 million in the first nine months
  of 2000 from $46.4 million in the same period of 1999. Net sales for the first
  nine months of 2000 increased 4% to $284.3 million from $274.3 million in the
  same period of 1999.
  
       Earnings increased primarily due to increased volumes of effect pigments to
  industrial and cosmetics markets. In addition, earnings of specialty
  kaolin-based products and specialty film products increased as a result of
  increased volumes. Lower production costs of color pigments also had a favorable
  impact on earnings.
  
  Paper Pigments and Additives
  ----------------------------
  
       Operating earnings decreased 50% to $10.6 million in the first nine months
  of 2000 from $21.1 million in the same period of 1999. Net sales for the first
  nine months of 2000 increased 1% to $179.9 million from $177.9 million in the
  same period of 1999.
  
       Earnings decreased as the effect of higher volumes were offset by higher
  energy costs, lower selling prices and an unfavorable product mix.
  
  Industrial Commodities Management
  ---------------------------------
  
       Operating earnings increased 163% to $77.6 million in the first nine months
  of 2000 from $29.6 million in the same period of 1999. Net sales for the first
  nine months of 2000 increased 30% to $2.6 billion from $2.0 billion in the
  same period of 1999.
  
       The sales increase resulted from higher prices and the continued strong
  demand for platinum group metals. The operating earnings increase resulted from
  significantly higher volatility in platinum group metals.
  
  
                          Financial Condition and Liquidity
                          ---------------------------------
  
       The Company's current ratio was 1.0 at September 30, 2000 and December 31,
  1999. The Company's total-debt-to-total-capital ratio decreased to 48% at
  September 30, 2000 from 55% at December 31, 1999, due to decreased long-term
  borrowings and increased retained earnings.
  
       The variance in cash flows from operating activities and financing
  activities primarily occurred in the Industrial Commodities Management segment
  and reflects changes in metal positions used to facilitate requirements of the
  Company, its customers and suppliers. The nature of the Industrial Commodities
  Management business can result in significant fluctuations in cash flow. To that
  end, committed metal positions increased due to a significant purchase of
  precious metals close to quarter end. Payment terms reduced the immediate
  outflow of cash and this is reflected in the increase in accounts payable.
  Hedged metal obligations also increased as a consequence of this transaction.
  This metal will be sold during the fourth quarter of 2000 causing an offsetting
  reduction in all balances. Cash flows from operating activities were also
  negatively impacted by higher receivables related to increased prices of
  platinum group metals. The variance in cash flows from financing activities was
  also impacted by increased short-term borrowings to fund a major share
  repurchase in May 1999 and the repayment of long-term debt in the third quarter
  of 2000.
  
                                         14
  <PAGE>
  
       In July 1998, the Company filed a shelf registration for $300 million. The
  Company currently has no plans to issue debt under the shelf registration.
  
       Management believes the Company will continue to have adequate access to
  credit and other capital markets to meet its needs for the foreseeable future.
  
  
  
                                   Other Matters
                                   -------------
  
  
                             Forward-looking Statements
                             --------------------------
  
       This document contains forward-looking statements within the meaning of the
  Private Securities Litigation Reform Act of 1995. These statements relate to
  analyses and other information which are based on forecasts of future results
  and estimates of amounts not yet determinable. These statements also relate to
  the future prospects, developments and business strategies of Engelhard. These
  forward-looking statements are identified by their use of terms and phrases such
  as "anticipate," "believe," "could," "estimate," "expect," "intend," "may,"
  "plan," "predict," "project," "will" and similar terms and phrases, including
  references to assumptions. These forward-looking statements involve risks and
  uncertainties that may cause Engelhard's actual future activities and results of
  operations to be materially different from those suggested or described in this
  document. These risks include: competitive pricing or product development
  activities; Engelhard's ability to achieve and execute internal business plans;
  global economic trends; worldwide political instability and economic growth;
  markets, alliances and geographic expansions developing differently than
  anticipated; fluctuations in the supply and prices of precious and base metals;
  government legislation and/or regulation (particularly on environmental issues);
  technology, manufacturing and legal issues; and the impact of any economic
  downturns and inflation. Investors are cautioned not to place undue reliance
  upon these forward-looking statements, which speak only as of their dates.
  Engelhard disclaims any obligation to update or revise any forward-looking
  statements, whether as a result of new information, future events or otherwise.
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
                                         15
  <PAGE>
  
  
                            Part II - OTHER INFORMATION
                            ---------------------------
  
  Item 6.  Exhibits and Reports on Form 8-K                                 Pages
  -------  --------------------------------                                 -----
  
  (a)(12)  Computation of the Ratio of Earnings to Fixed Charges            18-19
  
  (b)      There were no reports on Form 8-K filed during the
           quarter ended September 30, 2000.
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
                                         16
  <PAGE>
  
  
                                     SIGNATURES
                                     ----------
  
       Pursuant to the requirements of the Securities Exchange Act of 1934, the
  registrant has duly caused this report to be signed on its behalf by the
  undersigned thereunto duly authorized.
  
  
  
                                               ENGELHARD CORPORATION
                                           -----------------------------
                                                    (Registrant)
  
  
  
  
  
  Date       November 13, 2000                  /s/ Orin R. Smith
          ---------------------            -----------------------------
                                                Orin R. Smith
                                                Chairman and Chief
                                                Executive Officer
  
  
  
  
  
  
  Date       November 13, 2000                 /s/ Michael A. Sperduto
         ----------------------            -----------------------------
                                                Michael A. Sperduto
                                                Chief Accounting
                                                Officer
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
                                         17
  
  <PAGE>
  
  
  
  
  
  
  
  
  
  
  
                                     EXHIBIT 12
  
  
                COMPUTATION OF THE RATIO OF EARNINGS TO FIXED CHARGES
                -----------------------------------------------------
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
                                         18
  <PAGE>
  <TABLE>
  <CAPTION>
  
                                                 ENGELHARD CORPORATION
                                 COMPUTATION OF THE RATIO OF EARNINGS TO FIXED CHARGES
                                                 (Dollars in Thousands)
                                                      (Unaudited)
  
                                       Nine Months Ended
                                         September 30,                            Years Ended December 31,
                                       ------------------   -----------------------------------------------------------------
                                             2000              1999        1998         1997         1996         1995
                                             ----              ----        ----         ----         ----         ----
  <S>                                     <C>>              <C>         <C>           <C>          <C>          <C>
  
  Earnings from continuing operations
  before provision for income taxes       $249,631          $284,118    $260,563      $ 85,812     $209,955     $185,312
  
  Add/(deduct)
  
     Portion of rents representative
     of the interest factor                  5,250             7,000       3,500         3,000        3,900        4,700
  
     Interest on indebtedness               47,867            56,555      58,887        52,776       45,009       31,326
  
     Equity dividends                        4,363             2,431       2,022         3,803        2,515        3,411
  
     Equity in (earnings) losses
     of affiliates                         (19,428)          (16,266)    (10,077)       47,833        5,008         (695)
                                          ---------         ---------   ---------     --------     --------     ---------
  
     Earnings, as adjusted                $287,683          $333,838    $314,895      $193,224     $266,387     $224,054
                                          =========         =========   =========     ========     ========     =========
  
  Fixed Charges
  
     Portion of rents representative
     of the interest factor               $  5,250          $  7,000    $  3,500      $  3,000     $  3,900     $  4,700
  
     Interest on indebtedness               47,867            56,555      58,887        52,776       45,009       31,326
  
     Capitalized interest                    2,911             2,580       1,897           651          875          784
                                           --------         ---------   ---------     --------      --------     --------
  
     Fixed charges                         $56,028          $ 66,135    $ 64,284      $ 56,427     $ 49,784     $ 36,810
                                           ========         =========   =========     ========      ========     ========
  
  Ratio of Earnings to Fixed Charges          5.13              5.05        4.90          3.42 (a)     5.35         6.09
                                           ========         =========   =========     ========      ========     ========
  
  
  (a)  Earnings in 1997 were negatively impacted by special and other charges of $149.6 million for a variety of events.
       Without such charges the ratio of earnings to fixed charges would have been 5.28.
  
  
  </TABLE>
                                         19
metadata_documents: [{"type": "10-Q", "sequence": "1", "filename": "0001.txt", "description": "SEPTEMBER 2000 FORM 10-Q", "secsgml_size_bytes": 49062}]
metadata_filer: {"company-data": {"conformed-name": "ENGELHARD CORP", "cik": "0000352947", "assigned-sic": "3330", "irs-number": "221586002", "state-of-incorporation": "DE", "fiscal-year-end": "1231"}, "filing-values": {"form-type": "10-Q", "act": "34", "file-number": "001-08142", "film-number": "759413"}, "business-address": {"street1": "101 WOOD AVENUE", "city": "ISELIN", "state": "NJ", "zip": "08830", "phone": "9082055000"}, "mail-address": {"street1": "101 WOOD AVENUE", "city": "ISELIN", "state": "NJ", "zip": "08830"}}
text: UNITED STATES
                           SECURITIES AND EXCHANGE COMMISSION
                                 Washington, D.C. 20549
                    ------------------------------------------------
                                      FORM 10-Q
             (Mark One)
  
              X     QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
             ---        OF THE SECURITIES EXCHANGE ACT OF 1934
  
                     For the quarterly period ended September 30, 2000
                                         OR
             ---    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
                        OF THE SECURITIES EXCHANGE ACT OF 1934
                    ------------------------------------------------
  
                 For the transition period from ________ to _________
  
                             Commission file number 1-8142
  
                                ENGELHARD CORPORATION
                ------------------------------------------------------
                (Exact name of Registrant as specified in its charter)
  
                  DELAWARE                            22-1586002
       -------------------------------       -------------------------------
       (State or other jurisdiction of       (I.R.S. Employer Identification
       incorporation or organization)         No.)
  
       101 WOOD AVENUE, ISELIN, NEW JERSEY                  08830
       ----------------------------------------       -----------------
       (Address of principal executive offices)           (Zip Code)
  
                                   (732) 205-5000
                  ----------------------------------------------------
                  (Registrant's telephone number, including area code)
  
                                   Not Applicable
                  ---------------------------------------------------
                  (Former name, former address and former fiscal year,
                              if changed since last report)
  
       Indicate by check mark whether the Registrant (1) has filed all reports
  required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of
  1934 during the preceding 12 months (or for such shorter period that the
  Registrant was required to file such reports), and (2) has been subject to such
  filing requirements for the past 90 days.
  
                              Yes   X       No
                                   ---          ---
  
  Indicate the number of shares  outstanding  of each of the  issuer's  classes of
  common stock, as of the latest practicable date.
  
  Class of Common Stock                        Outstanding at October 31, 2000
  ---------------------                        -------------------------------
      $1 par value                                      127,779,536
  
                                          1
  PART I - FINANCIAL INFORMATION
  
  Item 1 - Financial Statements
  
                                ENGELHARD CORPORATION
                    CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS
                          (Thousands, except per share data)
                                     (Unaudited)
  
                                    Three Months Ended       Nine Months Ended
                                      September 30,            September 30,
                                 ------------------------  ----------------------
                                     2000        1999         2000        1999
                                 -----------  -----------  ----------  ----------
  Net sales .................... $1,374,350   $1,016,242   $3,937,325  $3,292,209
  Cost of sales ................  1,207,698      865,665    3,394,618   2,824,149
                                 -----------  -----------  ----------  ----------
  
       Gross profit ............    166,652      150,577      542,707     468,060
  
  Selling, administrative and
    other expenses .............     79,308       69,428      258,807     232,358
                                 -----------  -----------   ---------   ---------
  
       Operating earnings ......     87,344       81,149      283,900     235,702
  
  Equity in earnings of
    affiliates .................      5,031        4,192       19,428      11,995
  Gain/(loss) on disposal of
    investments and land .......        170        2,911       (5,830)      8,592
  Interest expense, net ........    (15,001)     (14,869)     (47,867)    (43,735)
                                 -----------  -----------   ----------  ----------
  
       Earnings before income
         taxes .................     77,544       73,383      249,631     212,554
  
  Income tax expense ...........     26,210       22,382       80,417      64,829
                                 -----------  -----------   ----------  ----------
  
       Net earnings ............ $   51,334   $   51,001    $ 169,214   $ 147,725
                                 ===========  ===========   ==========  ==========
  
  Basic earnings per share ..... $     0.41   $     0.41    $    1.34   $    1.10
                                 ===========  ===========   ==========  ==========
  
  Diluted earnings per share ... $     0.40   $     0.40    $    1.32   $    1.08
                                 ===========  ===========  =========== ===========
  
  Cash dividends per share       $     0.10   $     0.10    $    0.30   $    0.30
                                 ===========  ===========  =========== ===========
  Average number of shares
    outstanding - Basic ........    126,451      125,921      126,281     134,642
                                 ===========  ===========  =========== ===========
  Average number of shares
    outstanding - Diluted ......    128,368      128,592      127,983     136,914
                                 ===========  ===========  =========== ===========
  
         See the Accompanying Notes to the Unaudited Condensed Consolidated
                                Financial Statements
  
                                          2
  ENGELHARD CORPORATION
                        CONDENSED CONSOLIDATED BALANCE SHEETS
                                     (Thousands)
                                     (Unaudited)
  
                                                     September 30,  December 31,
                                                         2000           1999
                                                     ------------   ------------
  
  Cash .............................................  $   35,364     $   54,375
  Receivables, net..................................     438,954        394,338
  Committed metal positions ........................   1,320,904        467,768
  Inventories ......................................     373,736        359,153
  Other current assets .............................      98,647        121,672
                                                      ----------     ----------
         Total current assets ......................   2,267,605      1,397,306
  
  Investments ......................................     195,711        182,184
  Property, plant and equipment, net ...............     830,558        871,900
  Intangible assets, net ...........................     311,617        325,544
  Other noncurrent assets ..........................     111,390        143,590
                                                      ----------     ----------
         Total assets ..............................  $3,716,881     $2,920,524
                                                      ==========     ==========
  
  Short-term borrowings ............................  $  521,618     $  452,029
  Accounts payable .................................     912,335        246,016
  Hedged metal obligations .........................     592,211        497,800
  Other current liabilities ........................     281,418        268,978
                                                      ----------     ----------
         Total current liabilities .................   2,307,582      1,464,823
  
  Long-term debt ...................................     322,111        499,466
  Other noncurrent liabilities .....................     186,627        191,845
  Shareholders' equity .............................     900,561        764,390
                                                      ----------     ----------
         Total liabilities and
           shareholders' equity ....................  $3,716,881     $2,920,524
                                                      ==========     ==========
  
       See the Accompanying Notes to the Unaudited Condensed Consolidated
                              Financial Statements
  
                                          3
  ENGELHARD CORPORATION
                   CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                     (Thousands)
                                     (Unaudited)
  
                                                              Nine Months Ended
                                                                September 30,
                                                             --------------------
                                                                2000       1999
                                                             ---------   --------
  Cash flows from operating activities
       Net earnings ........................................ $169,214   $ 147,725
       Adjustments to reconcile net earnings to net cash
       provided by operating activities
            Depreciation and depletion .....................   77,258      72,519
            Amortization of intangible assets ..............    8,404       9,773
            Loss/(gain) on disposal of investments and land.    5,830      (8,592)
            Equity results, net of dividends ...............  (15,064)     (9,564)
            Net change in assets and liabilities
                 Metal related .............................  (84,982)    171,766
                 All other .................................  (45,006)    (51,431)
                                                             ---------   ---------
  
            Net cash provided by operating activities.......  115,654     332,196
                                                             ---------   ---------
  Cash flows from investing activities
       Capital expenditures ................................  (76,060)    (61,519)
       Proceeds from disposal of investments and land.......   52,811      10,449
       Acquisitions and other investments ..................  (40,095)     (1,230)
       Other ...............................................        -       2,408
                                                             ---------- ----------
  
            Net cash used in investing activities ..........  (63,344)    (49,892)
                                                             ---------   ---------
  
  Cash flows from financing activities
       Increase in short-term borrowings....................   19,529     203,673
       Increase/(decrease) in hedged metal obligations......   33,165    (184,192)
       Proceeds from issuance of long-term debt ............        -      45,894
       Repayment of long-term debt ......................... (103,703)     (3,784)
       Purchase of treasury stock ..........................        -    (296,076)
       Stock bonus and option plan transactions ............    7,641      10,732
       Dividends paid ......................................  (25,525)    (39,936)
                                                             ---------   ---------
  
            Net cash used in financing activities...........  (68,893)   (263,689)
  
  Effect of exchange rate changes on cash ..................   (2,428)     (2,296)
                                                             ---------   ---------
            Net (decrease)/increase in cash ................  (19,011)     16,319
            Cash at beginning of year ......................   54,375      22,339
                                                             ---------   ---------
  
            Cash at end of period........................... $ 35,364     $38,658
                                                             =========   =========
  
       See the Accompanying Notes to the Unaudited Condensed Consolidated
                               Financial Statements
  
                                          4
  ENGELHARD CORPORATION
                            BUSINESS SEGMENT INFORMATION
                                     (Thousands)
                                     (Unaudited)
  
                                     Three Months Ended       Nine Months Ended
                                        September 30,           September 30,
                                  -----------------------  -----------------------
                                       2000        1999        2000        1999
  Net Sales                       ------------ ----------  -----------  ----------
   Environmental Technologies ..  $  164,621  $  141,195   $  493,190  $  440,900
   Process Technologies ........     145,877     110,369      388,381     349,169
   Specialty Pigments and
     Additives .................      92,875      91,298      284,342     274,281
   Paper Pigments and Additives.      65,280      61,802      179,919     177,894
   Industrial Commodities
     Management ................     897,286     594,000    2,565,790   1,975,966
                                  ----------- -----------  ----------- -----------
         Reportable segments ...   1,365,939     998,664    3,911,622   3,218,210
  
   All other ...................       8,411      17,578       25,703      73,999
                                  ----------- -----------  ----------- -----------
                                  $1,374,350  $1,016,242   $3,937,325  $3,292,209
                                  =========== ===========  =========== ===========
  
  Operating Earnings
   Environmental Technologies ... $   35,552  $   24,361   $  101,381  $   80,348
   Process Technologies .........     19,495      18,784       54,433      52,736
   Specialty Pigments and
     Additives ..................     17,014      15,145       52,887      46,384
   Paper Pigments and Additives..      5,168       5,228       10,597      21,081
   Industrial Commodities
     Management .................     14,301       9,372       77,634      29,569
                                  ----------- -----------  ----------- -----------
         Reportable segments ...      91,530      72,890      296,932     230,118
  
    All other ...................     (4,186)      8,259      (13,032)      5,584
                                  ----------- -----------  ----------- -----------
                                      87,344      81,149      283,900     235,702
  
  Equity in earnings of
    affiliates .................       5,031       4,192       19,428      11,995
  Gain/(loss) on disposal of
    investments and land .......         170       2,911       (5,830)      8,592
  Interest expense, net ........     (15,001)    (14,869)     (47,867)    (43,735)
                                  ----------- -----------  ----------- -----------
         Earnings before income
           taxes ...............  $   77,544  $   73,383   $  249,631  $  212,554
  
  Income tax expense ...........      26,210      22,382       80,417      64,829
                                  ----------- -----------  ----------- -----------
         Net earnings ..........  $   51,334  $   51,001   $  169,214  $  147,725
                                  =========== ===========  =========== ===========
  
       See the Accompanying Notes to the Unaudited Condensed Consolidated
                              Financial Statements
  
                                          5
  Notes to the Unaudited Condensed Consolidated Financial Statements
  ------------------------------------------------------------------
  
  Note 1 - Basis of Presentation
  ------------------------------
  
       The unaudited condensed consolidated financial statements of Engelhard
  Corporation and subsidiaries (the "Company") contain all adjustments, which, in
  the opinion of management, are necessary for a fair statement of the results for
  the interim periods presented. The financial statement results for interim
  periods are not necessarily indicative of financial results for the full year.
  These financial statements should be read in conjunction with the consolidated
  financial statements and notes thereto included in the Company's 1999 Annual
  Report to Shareholders. Certain prior-year amounts have been reclassified
  to conform with the current-year presentation.
  
  Note 2 - Inventories
  --------------------
  
  Inventories consist of the following (in thousands):
  
                                      September 30, 2000      December 31, 1999
                                      ------------------      -----------------
  
  Raw materials .....................      $ 87,741              $ 84,165
  Work in process ...................        67,723                52,954
  Finished goods ....................       191,533               195,731
  Precious metals ...................        26,739                26,303
                                           --------              --------
  Total inventories .................      $373,736              $359,153
                                           ========              ========
  
       All precious metals included in inventories are stated at LIFO cost. The
  market value of the precious metals inventories exceeded cost by $198.8 million
  and $115.3 million at September 30, 2000 and December 31, 1999, respectively.
  
  Note 3 - Comprehensive Income
  -----------------------------
  
  Comprehensive income is summarized as follows (in thousands):
  
                                    Three Months Ended      Nine Months Ended
                                       September 30,          September 30,
                                    ------------------    ----------------------
                                     2000       1999         2000         1999
                                    --------  -------     ---------     --------
  Net earnings .................    $51,334   $51,001     $169,214      $147,725
  Other comprehensive income/(loss):
     Foreign currency
      translation adjustment         (4,512)   16,116       (5,431)        1,486
                                    -------   -------     ---------     --------
  Comprehensive income .........    $46,822   $67,117     $163,783      $149,211
                                    =======   =======     =========     ========
  
       No provision has been made for U.S. or additional foreign taxes on the
  undistributed earnings of foreign subsidiaries because such earnings are
  expected to be reinvested indefinitely in the subsidiaries' operations.
  
                                          6
  Note 4 - Earnings Per Share
  ---------------------------
  
  The following table represents the computation of basic and diluted earnings per
  share:
  
                                         Three Months Ended   Nine Months Ended
                                           September 30,       September 30,
                                         ------------------   -----------------
  (in thousands, except per share data)    2000      1999       2000      1999
  -------------------------------------  --------  --------   --------  --------
  
  Basic EPS Computation
  ---------------------
  Net earnings applicable to common
    shares                               $ 51,334  $ 51,001   $169,214  $147,725
                                         --------  --------   --------  --------
  Average number of shares
   outstanding - basic                    126,451   125,921    126,281   134,642
                                         --------  --------   --------  --------
  Basic earnings per share               $   0.41  $   0.41   $   1.34  $   1.10
                                         ========  ========   ========  ========
  
  Diluted EPS Computation
  -----------------------
  Net earnings applicable to common
    shares                               $ 51,334  $ 51,001   $169,214  $147,725
                                         --------  --------   --------  --------
  Average number of shares
   outstanding - basic                    126,451   125,921    126,281   134,642
  Effect of dilutive stock options
   and other incentives                       669     1,336        454       937
  Effect of Rabbi Trust                     1,248     1,335      1,248     1,335
                                         --------  --------   --------  --------
  Average number of shares
   outstanding - diluted                  128,368   128,592    127,983   136,914
                                         --------  --------   --------  --------
  Diluted earnings per share             $   0.40  $   0.40   $   1.32  $   1.08
                                         ========  ========   ========  ========
  
  Note 5 - Disposal of Investments and Land
  -----------------------------------------
  
       In the third quarter of 2000, the Company sold it's metal joining products
  business located in Warwick, Rhode Island. This business is a leading
  manufacturer of brazing alloys and fluxes, as well as a supplier of lead-free
  solder, serving metal-joining industries such as plumbing, electronics,
  lighting, shipbuilding and aerospace. The Company recorded a gain of $24.8
  million ($15.2 million after tax or $0.12 per share on a diluted basis) which
  was recorded in "Gain/(loss) on disposal of investments and land" in the
  Company's Condensed Consolidated Statements of Earnings. Net cash proceeds
  received were $41.8 million. In 1999, this business had approximately $49
  million in annual revenue and was reported in the Company's Environmental
  Technologies Segment.
  
                                          7
  In accordance with SFAS No. 121, "Accounting for the Impairment of
  Long-Lived Assets and for Long-Lived Assets to Be Disposed Of," the Company
  evaluated the recoverability of the long-lived assets, including goodwill, of
  its HexCore business unit. This business unit manufactures and markets
  desiccant-coated rotors and related products, and is reported in the Company's
  "All Other" segment. As part of the Company's annual budgeting process, it was
  determined that HexCore's estimated future undiscounted cash flows were below
  the carrying value of its assets, primarily due to the loss of a major customer
  in August 2000. Accordingly, during the third quarter of 2000, the Company
  adjusted the carrying value of HexCore's long-lived assets and goodwill to their
  estimated fair values. The resulting impairment charge was approximately $24.6
  million ($16.9 million after-tax or $0.13 per share on a diluted basis) and was
  recorded in "Gain/(loss) on disposal of investments and land" in the Company's
  Condensed Consolidated Statements of Earnings. The impairment charge consisted
  of a write-down of goodwill of $21.9 million and fixed assets of $2.7 million.
  The estimated fair value was based on anticipated future cash flows discounted
  at a rate commensurate with the Company's estimated cost of capital.
  
  Note 6 - Acquisitions
  ---------------------
  
       In September 2000, the Company acquired a polyolefin catalyst business
  located in Tarragona, Spain from Targor GmbH, a subsidiary of BASF AG, for
  approximately $35 million. As part of the acquisition, the Company obtained a
  supply agreement to become the exclusive supplier of polyolefin catalysts to
  Novolen Technology Holdings C.V. This acquisition was recorded under the
  purchase method of accounting, and accordingly, the results of operations of
  this acquisition have been included in the accompanying consolidated financial
  statements from the date of acquisition. A portion of the purchase price has
  been allocated to assets acquired and liabilities assumed based on their fair
  values, while the remaining balance was recorded as an intangible asset and is
  being amortized over 15 years. Pro forma information is not provided since the
  impact of the acquisition does not have a material effect on the Company's
  results of operations, cash flows or financial position.
  
                                          8
  Note 7 - New Accounting Pronouncements
  --------------------------------------
  
       In June 1998, the Financial Accounting Standards Board (FASB) issued
  Statement of Financial Accounting Standards No. 133, "Accounting for Derivative
  Instruments and Hedging Activities" ("SFAS 133"). In June 1999, the FASB issued
  SFAS No. 137, "Accounting for Derivative Instruments and Hedging Activities -
  Deferral of the Effective Date of FASB Statement No. 133". SFAS No. 137 delayed
  the required adoption of SFAS No. 133 to all fiscal quarters of all fiscal years
  beginning after June 15, 2000. In June 2000, the FASB issued SFAS No. 138,
  "Accounting for Certain Derivative Instruments and Certain Hedging Activities
  (an amendment of FASB Statement No. 133). These standards require that all
  derivative instruments be recorded on the balance sheet at their fair value.
  Changes in the fair value of derivatives are recorded each period in earnings or
  comprehensive income, depending on the designation of the derivative.
  
       The Company will adopt these statements in the first quarter of 2001 and
  does not expect them to have a material effect on the Company's results of
  operations, financial position, cash flows or equity.
  
  Note 8 - Other Matters
   ----------------------
  
       In 1998, Management learned that Engelhard and several other companies
  operating in Japan had been victims of a fraudulent scheme involving base-metal
  inventory held in third-party warehouses in Japan.  The inventory loss was
  approximately $40 million in 1997 and $20 million in 1998.  The Company is
  vigorously pursuing various recovery actions.  These actions include
  negotiations with the various third parties involved and, in several instances,
  the commencement of litigation.  In the first quarter of 1998, Engelhard
  recorded a receivable from the insurance carriers and third parties involved
  for approximately $20 million.  This amount represents Management's and
  counsel's best estimate of the minimum probable recovery from the various
  insurance policies and other parties involved in the fraudulent scheme.
  
       The Company is involved in a value-added tax dispute in Peru, which
  Management believes has a maximum economic exposure of approximately $30
  million. On December 2, 1999, Engelhard Peru, S.A., a wholly owned subsidiary,
  was denied refund claims of approximately $28 million. The Peruvian tax
  authority also determined that Engelhard Peru, S.A. is liable for approximately
  $63 million in refunds previously paid, fines and interest as of December 31,
  1999. Interest and fines continue to accrue at rates established by Peruvian
  law. Engelhard Peru, S.A. is contesting these determinations vigorously, and
  Management believes, based on consultation with counsel, that Engelhard Peru,
  S.A. is entitled to all refunds claimed and is not liable for these additional
  taxes, fines or interest. In late October 2000, a criminal proceeding alleging
  tax fraud and forgery related to this value-added tax dispute was initiated
  against two Lima based officials of Engelhard Peru, S.A. Although Engelhard
  Peru, S.A. is not a defendant, it may be civilly liable for criminal conduct of
  its representatives and Engelhard Peru is assisting in the vigorous defense of
  this proceeding. Management believes the maximum economic exposure is limited to
  the aggregate value of all assets of Engelhard Peru, S.A., including unpaid
  refunds, which is approximately $30 million.
  
                                          9
  Management's Discussion and Analysis of
  Item 2.   Financial Condition and Results of Operations
  -------   ---------------------------------------------
  
                                Results of Operations
                                ---------------------
  
  Comparison of the Third Quarter of 2000
  with the Third Quarter of 1999
  ----------------------------------------
  
       Net earnings increased 1% to $51.3 million in the third quarter of 2000
  from $51.0 million in the same period of 1999. Operating earnings for the third
  quarter of 2000 increased 8% to $87.3 million from $81.1 million in the same
  period of 1999. Higher operating earnings were reported in four of the Company's
  five reportable segments -- Environmental Technologies, Process Technologies,
  Specialty Pigments and Additives and Industrial Commodities Management.
  Operating earnings from the Paper Pigments and Additives segment were
  essentially flat from the same period of 1999.
  
       The effective tax rate was 33.8% in the third quarter of 2000 compared with
  30.5% for the same period last year. The higher effective rate was primarily
  driven by a lower estimated tax basis in the HexCore assets written off in the
  third quarter of 2000.
  
       The Company's share of earnings from affiliates increased 20% to $5.0
  million in the third quarter of 2000 compared with $4.2 million for the same
  period in 1999. Higher equity earnings were primarily from Heesung Engelhard, an
  environmental catalyst joint venture.
  
       Net interest expense increased 1% to $15.0 million in the third quarter of
  2000 from $14.9 million in the same period of 1999. In the third quarter of
  1999, net interest expense included $3.0 million of income resulting from the
  settlement of treasury lock positions. Excluding this income, net interest
  expense would have decreased 16% primarily due to decreased borrowings,
  partially offset by an increase in interest rates.
  
       Net sales increased 35% to $1.4 billion in the third quarter of 2000 from
  $1.0 billion for the same period of 1999. Higher sales were reported in all five
  of the Company's reportable segments.
  
                                         10
  Environmental Technologies
  --------------------------
  
       Operating earnings increased 46% to $35.6 million in the third quarter of
  2000 from $24.4 million in the same period of 1999. Net sales for the third
  quarter of 2000 increased 17% to $164.6 million from $141.2 million in the same
  period of 1999.
  
       The majority of this segment's sales and operating earnings are derived
  from technologies to control pollution from mobile sources, including gasoline
  and diesel-powered passenger cars, sport-utility vehicles, trucks, buses and
  off-road vehicles. Earnings increased in North America, primarily as a result of
  increased volumes for auto-emission catalysts. Foreign earnings increased due to
  an improved product mix resulting from the introduction of advanced technologies
  concurrent with the new model year.
  
       Earnings in the segment's non-automotive markets also increased due to
  significantly higher sales of stationary emission systems for gas turbines.
  
  Process Technologies
  --------------------
  
       Operating earnings increased 4% to $19.5 million in the third quarter of
  2000 from $18.8 million in the same period of 1999. Net sales for third quarter
  of 2000 increased 32% to $145.9 million from $110.4 million in the same period
  of 1999.
  
       Earnings growth from chemical catalysts was partially offset by a decline
  in earnings from petroleum catalysts and polypropylene catalysts.
  
       Earnings from chemical catalysts increased primarily due to increased
  volumes compared with a relatively weak year ago quarter. Earnings were also
  favorably impacted by the third quarter shipment of orders that were delayed
  from the first half of this year. Higher revenues of chemical catalysts
  reflected higher precious metal prices this year.
  
       Earnings from petroleum catalysts decreased as the effect of increased
  volumes from fluid cracking catalysts were offset by an unfavorable product mix
  and higher energy costs. Earnings from polypropylene catalysts decreased as
  increased volumes were offset by an unfavorable product mix and increased
  operating expenses.
  
  Specialty Pigments and Additives
  --------------------------------
  
       Operating earnings increased 12% to $17.0 million in the third quarter of
  2000 from $15.1 million in the same period of 1999.  Net sales for the third
  quarter of 2000 increased 2% to $92.9 million from $91.3 million in the same
  period of 1999.
  
       Earnings increased primarily due to increased volumes of effect pigments to
  industrial and cosmetics markets. In addition, lower production costs of color
  pigments had a favorable impact on earnings. These increased results were
  partially offset by decreased earnings of performance additives primarily
  resulting from higher energy costs.
  
                                         11
  Paper Pigments and Additives
  ----------------------------
  
       Operating earnings of $5.2 million for the third quarter of 2000 were
  essentially flat compared with the same period of 1999. Net sales for the third
  quarter of 2000 increased 6% to $65.3 million from $61.8 million in the same
  period of 1999.
  
       Earnings were essentially flat with the same period of 1999 as increased
  volumes were offset by higher energy costs and lower selling prices.
  
  Industrial Commodities Management
  ---------------------------------
  
       Operating earnings increased 53% to $14.3 million in the third quarter of
  2000 from $9.4 million in the same period of 1999. Net sales for the third
  quarter of 2000 increased 51% to $897.3 million from $594.0 million in the same
  period of 1999.
  
       The sales increase resulted from higher prices and the continued strong
  demand for platinum group metals. The operating earnings increase resulted from
  significantly higher volatility in platinum group metals.
  
  Comparison of the First Nine Months of 2000
  with the First Nine Months of 1999
  ------------------------------------------
  
       Net earnings increased 15% to $169.2 million in the first nine months of
  2000 from $147.7 million in the same period of 1999. Operating earnings for the
  first nine months of 2000 increased 20% to $283.9 million from $235.7 million in
  the same period of 1999. Four of the Company's five reportable segments reported
  increased operating earnings -- Environmental Technologies, Process
  Technologies, Specialty Pigments and Additives and Industrial Commodities
  Management.
  
       The effective tax rate was 32.2% in the first nine months of 2000 compared
  with 30.5% for the same period last year. The higher effective rate was driven
  by a lower estimated tax basis in the HexCore assets written off in the third
  quarter of 2000. In addition, the higher effective rate was due to a shift in
  the geographic mix of earnings and a changing product slate.
  
       The Company's share of earnings from affiliates increased 62% to $19.4
  million in the first nine months of 2000 from $12.0 million for the same period
  in 1999. The increase was primarily due to higher equity earnings from
  Engelhard-CLAL, a precious-metal-fabrication joint venture. The Company's share
  of earnings from Engelhard-CLAL included a gain of $6.7 million related to the
  partial liquidation of precious metal inventories. Higher equity earnings were
  also reported for Heesung Engelhard, an environmental catalyst joint venture.
  
       Net interest expense increased 9% to $47.9 million for the first nine
  months of 2000 from $43.7 million for the same period in 1999. For the nine
  month period ended September 30, 1999, net interest expense included $4.2
  million of income resulting from the settlement of treasury lock positions.
  Excluding this income, net interest expense would have been flat compared with
  the same period of 1999.
  
                                         12
  Net sales increased 20% to $3.9 billion in the first nine months of 2000
  from $3.3 billion in the same period in 1999. Higher sales were reported in all
  five of the Company's reportable segments. Sales reported in the "All Other"
  segment decreased primarily as the Company sold its metal plating business in
  the second quarter of 1999.
  
  Environmental Technologies
  --------------------------
  
       Operating earnings increased 26% to $101.4 million in the first nine months
  of 2000 from $80.3 million in the same period of 1999. Net sales for the first
  nine months of 2000 increased 12% to $493.2 million from $440.9 million in the
  same period of 1999.
  
       The majority of this segment's sales and operating earnings are derived
  from technologies to control pollution from mobile sources, including gasoline
  and diesel-powered passenger cars, sport-utility vehicles, trucks, buses and
  off-road vehicles. Earnings increased primarily from strength in auto-emission
  catalysts in both North America and Europe.
  
       Sales in the segment's non-automotive markets increased due to higher
  volumes of heavy-duty deisel-engine retrofits and stationary emission systems
  for gas turbines. Earnings in the non-automotive markets declined slightly as
  the effect of higher volumes were offset by higher research and administrative
  costs.
  
       The segment's earnings increases were partially offset by costs related to
  the start-up of new manufacturing facilities in Brazil and China, plus the
  expansion of a facility in India.
  
  Process Technologies
  --------------------
  
       Operating earnings increased 3% to $54.4 million in the first nine months
  of 2000 from $52.7 million in the same period of 1999. Net sales for the first
  nine months of 2000 increased 11% to $388.4 million from $349.2 million in the
  same period of 1999.
  
       Earnings growth from petroleum catalysts and polypropylene catalysts was
  offset by a decline in earnings from chemical catalysts.
  
       Earnings from petroleum catalysts increased primarily due to increased
  volumes from fluid cracking catalysts and reduced costs from
  supply-chain-management initiatives and productivity improvements, partially
  offset by increased energy costs. Earnings from polypropylene catalysts
  increased primarily from increased volumes.
  
       Earnings from chemical catalysts decreased as the effect of increased
  volumes were offset by higher manufacturing costs and an unfavorable foreign
  currency translation.
  
                                         13
  Specialty Pigments and Additives
  --------------------------------
  
       Operating earnings increased 14% to $52.9 million in the first nine months
  of 2000 from $46.4 million in the same period of 1999. Net sales for the first
  nine months of 2000 increased 4% to $284.3 million from $274.3 million in the
  same period of 1999.
  
       Earnings increased primarily due to increased volumes of effect pigments to
  industrial and cosmetics markets. In addition, earnings of specialty
  kaolin-based products and specialty film products increased as a result of
  increased volumes. Lower production costs of color pigments also had a favorable
  impact on earnings.
  
  Paper Pigments and Additives
  ----------------------------
  
       Operating earnings decreased 50% to $10.6 million in the first nine months
  of 2000 from $21.1 million in the same period of 1999. Net sales for the first
  nine months of 2000 increased 1% to $179.9 million from $177.9 million in the
  same period of 1999.
  
       Earnings decreased as the effect of higher volumes were offset by higher
  energy costs, lower selling prices and an unfavorable product mix.
  
  Industrial Commodities Management
  ---------------------------------
  
       Operating earnings increased 163% to $77.6 million in the first nine months
  of 2000 from $29.6 million in the same period of 1999. Net sales for the first
  nine months of 2000 increased 30% to $2.6 billion from $2.0 billion in the
  same period of 1999.
  
       The sales increase resulted from higher prices and the continued strong
  demand for platinum group metals. The operating earnings increase resulted from
  significantly higher volatility in platinum group metals.
  
                          Financial Condition and Liquidity
                          ---------------------------------
  
       The Company's current ratio was 1.0 at September 30, 2000 and December 31,
  1999. The Company's total-debt-to-total-capital ratio decreased to 48% at
  September 30, 2000 from 55% at December 31, 1999, due to decreased long-term
  borrowings and increased retained earnings.
  
       The variance in cash flows from operating activities and financing
  activities primarily occurred in the Industrial Commodities Management segment
  and reflects changes in metal positions used to facilitate requirements of the
  Company, its customers and suppliers. The nature of the Industrial Commodities
  Management business can result in significant fluctuations in cash flow. To that
  end, committed metal positions increased due to a significant purchase of
  precious metals close to quarter end. Payment terms reduced the immediate
  outflow of cash and this is reflected in the increase in accounts payable.
  Hedged metal obligations also increased as a consequence of this transaction.
  This metal will be sold during the fourth quarter of 2000 causing an offsetting
  reduction in all balances. Cash flows from operating activities were also
  negatively impacted by higher receivables related to increased prices of
  platinum group metals. The variance in cash flows from financing activities was
  also impacted by increased short-term borrowings to fund a major share
  repurchase in May 1999 and the repayment of long-term debt in the third quarter
  of 2000.
  
                                         14
  In July 1998, the Company filed a shelf registration for $300 million. The
  Company currently has no plans to issue debt under the shelf registration.
  
       Management believes the Company will continue to have adequate access to
  credit and other capital markets to meet its needs for the foreseeable future.
  
                                   Other Matters
                                   -------------
  
                             Forward-looking Statements
                             --------------------------
  
       This document contains forward-looking statements within the meaning of the
  Private Securities Litigation Reform Act of 1995. These statements relate to
  analyses and other information which are based on forecasts of future results
  and estimates of amounts not yet determinable. These statements also relate to
  the future prospects, developments and business strategies of Engelhard. These
  forward-looking statements are identified by their use of terms and phrases such
  as "anticipate," "believe," "could," "estimate," "expect," "intend," "may,"
  "plan," "predict," "project," "will" and similar terms and phrases, including
  references to assumptions. These forward-looking statements involve risks and
  uncertainties that may cause Engelhard's actual future activities and results of
  operations to be materially different from those suggested or described in this
  document. These risks include: competitive pricing or product development
  activities; Engelhard's ability to achieve and execute internal business plans;
  global economic trends; worldwide political instability and economic growth;
  markets, alliances and geographic expansions developing differently than
  anticipated; fluctuations in the supply and prices of precious and base metals;
  government legislation and/or regulation (particularly on environmental issues);
  technology, manufacturing and legal issues; and the impact of any economic
  downturns and inflation. Investors are cautioned not to place undue reliance
  upon these forward-looking statements, which speak only as of their dates.
  Engelhard disclaims any obligation to update or revise any forward-looking
  statements, whether as a result of new information, future events or otherwise.
  
                                         15
  Part II - OTHER INFORMATION
                            ---------------------------
  
  Item 6.  Exhibits and Reports on Form 8-K                                 Pages
  -------  --------------------------------                                 -----
  
  (a)(12)  Computation of the Ratio of Earnings to Fixed Charges            18-19
  
  (b)      There were no reports on Form 8-K filed during the
           quarter ended September 30, 2000.
  
                                         16
  SIGNATURES
                                     ----------
  
       Pursuant to the requirements of the Securities Exchange Act of 1934, the
  registrant has duly caused this report to be signed on its behalf by the
  undersigned thereunto duly authorized.
  
                                               ENGELHARD CORPORATION
                                           -----------------------------
                                                    (Registrant)
  
  Date       November 13, 2000                  /s/ Orin R. Smith
          ---------------------            -----------------------------
                                                Orin R. Smith
                                                Chairman and Chief
                                                Executive Officer
  
  Date       November 13, 2000                 /s/ Michael A. Sperduto
         ----------------------            -----------------------------
                                                Michael A. Sperduto
                                                Chief Accounting
                                                Officer
  
                                         17
  EXHIBIT 12
  
                COMPUTATION OF THE RATIO OF EARNINGS TO FIXED CHARGES
                -----------------------------------------------------
  
                                         18
  ENGELHARD CORPORATION
                                 COMPUTATION OF THE RATIO OF EARNINGS TO FIXED CHARGES
                                                 (Dollars in Thousands)
                                                      (Unaudited)
  
                                       Nine Months Ended
                                         September 30,                            Years Ended December 31,
                                       ------------------   -----------------------------------------------------------------
                                             2000              1999        1998         1997         1996         1995
                                             ----              ----        ----         ----         ----         ----
  >
  Earnings from continuing operations
  before provision for income taxes       $249,631          $284,118    $260,563      $ 85,812     $209,955     $185,312
  
  Add/(deduct)
  
     Portion of rents representative
     of the interest factor                  5,250             7,000       3,500         3,000        3,900        4,700
  
     Interest on indebtedness               47,867            56,555      58,887        52,776       45,009       31,326
  
     Equity dividends                        4,363             2,431       2,022         3,803        2,515        3,411
  
     Equity in (earnings) losses
     of affiliates                         (19,428)          (16,266)    (10,077)       47,833        5,008         (695)
                                          ---------         ---------   ---------     --------     --------     ---------
  
     Earnings, as adjusted                $287,683          $333,838    $314,895      $193,224     $266,387     $224,054
                                          =========         =========   =========     ========     ========     =========
  
  Fixed Charges
  
     Portion of rents representative
     of the interest factor               $  5,250          $  7,000    $  3,500      $  3,000     $  3,900     $  4,700
  
     Interest on indebtedness               47,867            56,555      58,887        52,776       45,009       31,326
  
     Capitalized interest                    2,911             2,580       1,897           651          875          784
                                           --------         ---------   ---------     --------      --------     --------
  
     Fixed charges                         $56,028          $ 66,135    $ 64,284      $ 56,427     $ 49,784     $ 36,810
                                           ========         =========   =========     ========      ========     ========
  
  Ratio of Earnings to Fixed Charges          5.13              5.05        4.90          3.42 (a)     5.35         6.09
                                           ========         =========   =========     ========      ========     ========
  
  (a)  Earnings in 1997 were negatively impacted by special and other charges of $149.6 million for a variety of events.
       Without such charges the ratio of earnings to fixed charges would have been 5.28.
  19