8-K






SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549


FORM 8-K


CURRENT REPORT

Pursuant to Section 13 or 15 (d) of the
Securities Exchange Act of 1934


Date of Report (Date of earliest event reported): April 29, 2003



    ENGELHARD CORPORATION    
(Exact name of registrant as specified in its charter)



  Delaware     1-8142     22-1586002  
(State of other jurisdiction of incorporation) (Commission File Number (I.R.S. Employer Identification No.)


101 Wood Avenue, Iselin, New Jersey     08830  
(Address of principal executive offices)   (Zip Code)


Registrant's telephone number, including are code (732) 205-5000












Item 7.   Financial Statements and Exhibits.

(c) The following exhibit is furnished as a part of this report:

  Exhibit No. Description                
  99.1 Press Release, dated April 29, 2003, relating to Engelhard Corporation's earnings release for the first quarter of 2003.



Item 9.   Regulation FD Disclosure (and Item 12. Results of Operations and Financial Condition).

On April 29, 2003, Engelhard Corporation (the "Company") issued a press release announcing its earnings for its first quarter of fiscal year 2003. A copy of the release is furnished herewith as Exhibit 99.1. The attached press release includes non-GAAP financial measures of net earnings and diluted earnings per share before cumulative effect of a change in accounting principle, net of tax - as adjusted and segment operating earnings, and includes a reconciliation to the most comparable GAAP measure. Management believes that this presentation provides useful information to investors because it better reflects the core earnings of the Company.
































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: April 29, 2003
                      /s/ Michael A. Sperduto
                         Michael A. Sperduto
                         Vice President and
                   Chief Financial Officer




























EXHIBIT INDEX


Exhibit No. Description         
99.1 Press Release, dated April 29, 2003, relating to Engelhard Corporation's earnings release for the first quarter of 2003.

EXHIBIT (99.1)

Engelhard Logo
  News Contact
Ted Lowen
(Media)
732-205-6360

Peter Martin
(Investor Relations)
732-205-6106
Ref. #C______

Engelhard Corporation
101 Wood Avenue
P.O. Box 770
Iselin, NJ 08830-0770

For immediate release

ENGELHARD REPORTS FIRST-QUARTER RESULTS

ISELIN, NJ, April 29, 2003 - Engelhard Corporation (NYSE: EC) today reported net earnings for the first quarter ended March 31 of $56.7 million, or 44 cents per share, compared with $52.4 million, or 40 cents per share, for the same period a year ago.

       The current quarter included an after-tax benefit of 14 cents per share related to a previously reported $38 million settlement of a royalty-sharing dispute. The quarter also included charges totaling four cents per share primarily related to additional productivity actions and two cents per share to record the cumulative effect of a recent change in an accounting principle (Statement of Financial Accounting Standards No. 143), which impacted the timing of mining-reclamation expense.

       First-quarter sales were $830 million compared with $1.0 billion a year ago, which reflected continuing lower volumes and prices of platinum group metals, which are passed through to customers.

       "Our operating results were in line with estimates before special items," said Barry W. Perry, chairman and chief executive officer. "We continue to take actions to improve productivity and drive value-added, technology-based growth platforms into new markets. We believe these actions will enable the company to post modestly improved earnings again this year even without significant improvement in underlying market conditions from an economic recovery."

       Mr. Perry said proceeds from the royalty settlement are being used in the second quarter to accelerate the company's share-repurchase program. He also indicated that the company plans to take a second quarter charge amounting to approximately $9 million, or five cents per share, which will provide for the remaining lease cost for minerals storage facilities no longer needed because of 2002 productivity initiatives.

      Contributions from new growth platforms and productivity actions taken in the first half of 2003 will help offset inflationary headwinds and energy costs, thereby enabling full-year earnings growth for the company's technology segments, Mr. Perry added.

       "Our financial condition remains among the best-in-class based on high free cash flow, mid-teens return on invested capital and net debt at a seven-year low," Mr. Perry said.

First-Quarter Operating Results

       Operating earnings from Environmental Technologies decreased 38% to $24.6 million, which includes a $5.3 million charge in the current year's quarter and the reversal of a $4.9 million warranty accrual that favorably impacted the prior-year period. Excluding those items, operating earnings decreased 14% to $29.8 million. Sales rose 30% to $214 million on increased revenue from mobile environmental market applications. More than half the increase in sales resulted from the higher pass-through cost of substrates to those markets.

      The segment's earnings decline resulted from a difficult comparison with an exceptionally strong year-ago quarter in the energy market and lower demand from the aerospace industry, which were partly offset by improved results from mobile market applications.

       Operating earnings from Process Technologies declined 21% to $13.5 million, which includes a productivity-related charge of $2.6 million in the current quarter. Excluding that charge, operating earnings declined 6% to $16.1 million. Sales rose 3% to $119 million. The impact of continuing weak demand from core chemical-process markets was partially offset by demand for new technologies offered to the petroleum refining, polyolefin and gas-to-liquids markets.

       Operating earnings from Appearance and Performance Technologies rose 23% to $18.6 million, while sales rose 4% to $159 million. A combination of increased sales to markets for effects and colors, favorable product mix and volumes to specialty mineral-based markets and benefits from continuing productivity efforts led to the solid results in spite of $3 million of higher energy costs.

       Operating earnings from Materials Services declined 56% to $4 million, and sales were off 41% to $329 million. The lower results continued to reflect reduced industrial demand for platinum group metals and recycling services.

       Engelhard Corporation is a surface and materials science company that develops technologies to improve customers' products and processes. A Fortune 500 company, Engelhard is a world-leading provider of technologies for environmental, process, appearance and performance applications. For more information, visit Engelhard on the Internet at www.engelhard.com.

       Forward-looking statements: This document contains forward-looking statements in management's comments. There are a number of factors that could cause Engelhard's actual results to vary materially from those projected in the forward-looking statements. For a more thorough discussion of these factors, please refer to page 26 of Engelhard's 2002 Form 10-K, dated March 25, 2003.






ENGELHARD CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS
(Thousands, except per share data)
(Unaudited)

  Three Months Ended
March 31,
  2003
   2002
Net sales $ 830,439     $ 1,001,821  
Cost of sales  
 680,878
      
 841,129
  
     Gross profit   149,561       160,692  
Selling, administrative and other expenses   92,169       87,611  
Special credit, net  
 (19,780
 )    
 -
  
     Operating earnings   77,172       73,081  
Equity in earnings of affiliates   5,637       3,662  
Interest expense, net  
 (5,557
 )    
 (6,920
 )
     Earnings before income taxes   77,252       69,823  
Income tax expense  
 18,317
      
 17,456
  
     Net earnings before cumulative effect of a change              
          in accounting principle, net of tax   58,935 (A)     52,367  
     Cumulative effect of a change in accounting              
          principle, net of tax of $1,390  
 (2,269
 )    
 -
  
          Net earnings $
 56,666
     $
 52,367
  
Earnings per share - basic:
     Earnings before cumulative effect of a change
          in accounting principle 		$ 0.46     $ 0.41  
     Cumulative effect of a change in accounting              
          principle, net of tax  
 (0.02
 )    
 -
  
Earnings per share - basic $
 0.44
     $
 0.41
  
Earnings per share - diluted:
     Earnings before cumulative effect of a change
          in accounting principle 		$ 0.46 (A)   $ 0.40  
     Cumulative effect of a change in accounting              
          principle, net of tax  
 (0.02
 )    
 -
  
Earnings per share - diluted $
 0.44
     $
 0.40
  
Cash dividends paid per share $
 0.10
     $
 0.10
  
Average number of shares outstanding - basic  
 126,882
      
 128,794
  
Average number of shares outstanding - diluted  
 128,121
      
 131,594
  
Actual number of shares outstanding  
 126,941
      
 129,703
  

(A) Excluding certain items reported in 2003, Engelhard would have reported net earnings of $46.9 million and diluted earnings per share of $0.37 for the quarter ended March 31, 2003. Management believes the amounts as adjusted better reflect the core earnings of the Company. The following table reconciles the Company's net earnings and diluted earnings per share as reported with net earnings and diluted earnings per share as adjusted (in millions, except per share amounts):

  Net
Earnings
   Earnings
Per
Share
  
Net earnings before cumulative effect of a change in accounting principle, net of tax - as reported $ 58.9   $ 0.46  
     Research Corporation royalty settlement   (17.6 )   (0.14 )
     Special charges  
 5.6
    
 0.04
  
Net earnings before cumulative effect of a change in accounting principle, net of tax - as adjusted $
 46.9
   $
 0.37
 (B)

(B) - Amounts do not add due to rounding.

Had compensation cost for Engelhard's stock option plans been determined based on the fair value at grant date consistent with the provisions of Statement of Financial Accounting Standards No. 123, "Accounting for Stock Based Compensation," (assuming this standard was adopted on its effective date of October 1995), Engelhard would have reported net earnings and diluted earnings per share as follows:

  Three Months Ended
March 31,
Pro forma information (in thousands, except per share data)
 2003
   2002
Net earnings - as reported $ 56,666     $ 52,367  
Net earnings - pro forma   55,252       50,799  
Diluted earnings per share - as reported   0.44       0.40  
Diluted earnings per share - pro forma   0.43       0.39  





















ENGELHARD CORPORATION
BUSINESS SEGMENT INFORMATION
(Thousands)
(Unaudited)


  Three Months Ended
March 31,
  
  2003
   2002
 Change
Net Sales
     Environmental Technologies		 $ 213,540     $ 164,441     30 %
     Process Technologies   118,520       115,445     3 %
     Appearance and Performance Technologies  
 159,196
      
 152,370
     4 %
          Technology segments   491,256       432,256     14 %
     Materials Services   328,957       560,729     -41 %
     All other  
 10,226
      
 8,836
     16 %
          Total net sales $
 830,439
     $
 1,001,821
     -17 %
Operating Earnings
     Environmental Technologies		 $ 24,577 (A)   $ 39,662     -38 %
     Process Technologies   13,520 (B)     17,069     -21 %
     Appearance and Performance Technologies  
 18,583
      
 15,130
     23 %
          Technology segments   56,680       71,861     -21 %
     Materials Services   4,453       10,178     -56 %
     All other  
 16,039
 (C)    
 (8,958
 )   279 %
          Total operating earnings   77,172       73,081     6 %
Equity in earnings of affiliates   5,637       3,662     54 %
Interest expense, net  
 (5,557
 )    
 (6,920
 )   -20 %
          Earnings before income taxes   77,252       69,823     11 %
Income tax expense  
 18,317
      
 17,456
     5 %
     Net earnings before cumulative effect of a change                    
          in accounting principle, net of tax   58,935       52,367     13 %
     Cumulative effect of a change in accounting                    
          principle, net of tax of $1,390  
 (2,269
 )    
 -
     -  
          Net earnings $
 56,666
     $
 52,367
     8 %

(A) - Includes a $5.3 million restructuring charge.

(B) - Includes a $2.6 million restructuring charge.

(C) - Includes a $28.4 million royalty settlement gain and a Corporate $0.8 million restructuring charge.


ENGELHARD CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(Thousands)
(Unaudited)


  March 31,
2003
 December 31,
2002
Cash $ 129,818   $ 48,246  
Receivables, net   346,922     380,270  
Committed metal positions   705,507     615,441  
Inventories   434,546     427,162  
Other current assets  
 89,516
    
 94,922
  
     Total current assets   1,706,309     1,566,041  
Investments   139,180     136,804  
Property, plant and equipment, net   852,330     860,475  
Goodwill   271,920     272,353  
Other intangible and noncurrent assets  
 186,139
    
 185,041
  
     Total assets $
 3,155,878
   $
 3,020,714
  
Short-term borrowings $ 376,250   $ 348,749  
Accounts payable   181,759     225,045  
Hedged metal obligations   642,925     537,243  
Other current liabilities  
 283,345
    
 275,250
  
     Total current liabilities   1,484,279     1,386,287  
Long-term debt   246,193     247,805  
Other noncurrent liabilities   312,575     309,455  
Shareholders' equity  
 1,112,831
    
 1,077,167
  
     Total liabilities and shareholders' equity $
 3,155,878
   $
 3,020,714
  


















ENGELHARD CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Thousands)
(Unaudited)


  Three Months Ended
March 31,
  2003
 2002
Cash flows from operating activities            
     Net earnings $ 56,666   $ 52,367  
     Adjustments to reconcile net earnings to net cash
     provided by operating activities:		            
          Depreciation and depletion   31,202     25,572  
          Amortization of intangible assets   810     899  
          Equity results, net of dividends   (5,637 )   (3,662 )
          Net change in assets and liabilities:            
               Materials Services related   (60,286 )   (16,158 )
               All other  
 10,786
    
 14,540
  
               Net cash provided by operating activities  
 33,541
    
 73,558
  
Cash flows from investing activities            
     Capital expenditures   (15,384 )   (19,899 )
     Proceeds from investments   6,611     -  
     Acquisitions and other investments  
 -
    
 (400
 )
               Net cash used in investing activities  
 (8,773
 )  
 (20,299
 )
Cash flows from financing activities            
     Increase/(decrease) in short-term borrowings   27,501     (10,159 )
     Increase in hedged metal obligations   61,850     12,217  
     Repayment of long-term debt   (111 )   (80 )
     Purchase of treasury stock   (23,805 )   (45,063 )
     Cash from exercise of stock options   2,635     29,156  
     Dividends paid  
 (12,734
 )  
 (12,988
 )
               Net cash provided by/(used in) financing activities   55,336     (26,917 )
Effect of exchange rate changes on cash  
 1,468
    
 (1,498
 )
               Net increase in cash   81,572     24,844  
Cash at beginning of year  
 48,246
    
 33,034
  
               Cash at end of period $
 129,818
   $
 57,878