1

                                                             Page 1 of 47 Pages

                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D. C. 20549
                                    FORM 10-Q

[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
                                  ACT OF 1934

                    For Quarterly Period Ended June 30, 2003

                                       OR

[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
                             EXCHANGE ACT OF 1934

                        For Transition Period from to __________.

                         Commission File Number 1-12658

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

          VIRGINIA                                           54-1692118
          --------                                           ----------
(State or other jurisdiction of                          (I.R.S. Employer
 incorporation or organization)                           Identification No.)

       330 SOUTH FOURTH STREET
       RICHMOND, VIRGINIA                                        23219
       ------------------                                        -----
(Address of principal executive offices)                       (Zip Code)

       Registrant's telephone number, including area code - (804) 788-6000
                 Registrant's website address: www.albemarle.com

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  by check mark  whether  the  registrant  is an  accelerated  filer (as
defined in Rule 12b-2 of the Act).

                                    Yes X   No
                                       ----   ----

The Company makes available through its website, its annual report on Form 10-K,
quarterly reports on Form 10-Q,  current reports on Form 8-K, and all amendments
to  those  reports  as soon as  reasonably  practical  after  such  material  is
electronically filed with the Securities and Exchange Commission.

Number of shares of common stock, $.01 par value, outstanding as of
July 31, 2003:  41,236,509
                ----------

2

                                                                               

                              ALBEMARLE CORPORATION

                                    I N D E X
                                                                                  Page
                                                                                 Number(s)

PART I.    FINANCIAL INFORMATION

  ITEM 1.  Financial Statements

               Consolidated Balance Sheets - June 30, 2003 and
               December 31, 2002                                                   3-4

               Consolidated Statements of Income - Three- and Six-
               Months Ended June 30, 2003 and 2002                                  5

               Consolidated Statements of Comprehensive Income - Three-
               and Six- Months Ended June 30, 2003 and 2002                         6

               Condensed Consolidated Statements of Cash Flows - Six Months
                 Ended June 30, 2003 and 2002                                       7

               Notes to the Consolidated Financial Statements                      8-16

  ITEM 2.  Management's Discussion and Analysis of Results
               of Operations and Financial Condition and Additional
               Information                                                        17-27

  ITEM 3.  Quantitative and Qualitative Disclosures About Market Risk               28

  ITEM 4.  Controls and Procedures                                                  28

PART II.   OTHER INFORMATION

  ITEM 1.  Legal Proceedings                                                        29

  ITEM 6.  Exhibits and Reports on Form 8-K                                         29

SIGNATURES                                                                          30

EXHIBITS                                                                          31-47






3

                                                                                                         



PART I - FINANCIAL INFORMATION

ITEM 1.  Financial Statements


                     ALBEMARLE CORPORATION AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS
                             (Dollars In Thousands)

                                                                                June 30,                    December 31,
                                                                                  2003                          2002
                                                                         ------------------------    ------------------------
                                                                               (Unaudited)
ASSETS
Current assets:
   Cash and cash equivalents                                             $            49,993          $            37,636
   Accounts receivable, less allowance for doubtful
     accounts (2003 - $2,331;  2002 - $2,368)                                        193,010                      197,089
   Income tax receivable                                                              11,278                            -
   Inventories:
      Finished goods                                                                 127,841                      116,164
      Raw materials                                                                   21,862                       21,385
      Stores, supplies and other                                                      23,947                       23,256
                                                                         --------------------        ---------------------
                                                                                     173,650                      160,805
   Deferred income taxes and prepaid expenses                                         15,829                       17,534
                                                                         --------------------        ---------------------
          Total current assets                                                       443,760                      413,064
                                                                         --------------------        ---------------------
Property, plant and equipment, at cost                                             1,546,336                    1,497,989
      Less accumulated depreciation and amortization                               1,030,367                      978,918
                                                                         --------------------        ---------------------
          Net property, plant and equipment                                          515,969                      519,071

Prepaid pension assets                                                               168,799                      166,287
Other assets and deferred charges                                                     61,005                       59,363
Goodwill                                                                              30,667                       29,621
Other intangibles, net of amortization                                                28,982                        5,550
                                                                         --------------------        ---------------------
Total assets                                                             $         1,249,182          $         1,192,956
                                                                         ====================        =====================


                                   See accompanying notes to the consolidated financial statements.



4

                                                                                                         
                     ALBEMARLE CORPORATION AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS
                             (Dollars In Thousands)

                                                                                   June 30,               December 31,
                                                                                     2003                     2002
                                                                             ---------------------    -------------------
                                                                                 (Unaudited)
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
   Accounts payable                                                           $            85,603      $          75,092
   Long-term debt, current portion                                                            176                    343
   Accrued expenses                                                                        62,481                 65,051
   Dividends payable to shareholders                                                       11,070                  5,426
   Income taxes payable                                                                    23,258                 19,095
                                                                             ---------------------    -------------------
          Total current liabilities                                                       182,588                165,007
                                                                             ---------------------    -------------------
Long-term debt                                                                            175,183                180,137
Postretirement benefits                                                                    66,596                 64,943
Other noncurrent liabilities                                                               95,914                 84,280
Deferred income taxes                                                                     134,501                128,849

Shareholders' equity:
   Common stock, $.01 par value, issued and
      outstanding- 41,214,982 in 2003 and
      41,692,074 in 2002                                                                      412                    417
   Additional paid-in capital                                                                 128                  2,286
   Accumulated other comprehensive income (loss)                                            6,250                 (4,514)
   Retained earnings                                                                      587,610                571,551
                                                                             ---------------------    -------------------
          Total shareholders' equity                                                      594,400                569,740
                                                                             ---------------------    -------------------
Total liabilities and shareholders' equity                                    $         1,249,182      $       1,192,956
                                                                             =====================    ===================


                           See accompanying notes to the consolidated financial statements.



5

                                                                                                    


                     ALBEMARLE CORPORATION AND SUBSIDIARIES
                        CONSOLIDATED STATEMENTS OF INCOME
                     (In Thousands Except Per-Share Amounts)
                                   (Unaudited)


                                                         Three Months Ended                     Six Months Ended
                                                              June 30,                              June 30,
                                                ---------------------------------------------------------------------------
                                                        2003               2002               2003               2002
                                                ------------------  ------------------ -----------------  -----------------
Net sales (see Note 15)                         $         269,476   $         252,706  $        535,046   $        484,528
Cost of goods sold                                        211,050             194,551           418,978            370,613
                                                ------------------  ------------------ -----------------  -----------------
     Gross profit                                          58,426              58,155           116,068            113,915
Selling, general and administrative
   expenses                                                29,435              28,916            57,061             54,620
Research and development
   expenses                                                 4,421               4,020             9,363              8,796
Special item                                                   --                  --                --                850
                                                ------------------  ------------------ -----------------  -----------------
     Operating profit                                      24,570              25,219            49,644
                                                                                                                    49,649
Interest and financing expenses                            (1,257)             (1,235)           (2,594)            (2,460)
Other income and (expenses),
   including minority interest                               (316)              2,276             3,257              3,068
                                                ------------------  ------------------ -----------------  -----------------
Income before income taxes                                 22,997              26,260            50,307
                                                                                                                    50,257

Income taxes                                                  414               5,566             4,510             12,765
                                                ------------------  ------------------ -----------------  -----------------
Income before cumulative effect                            22,583              20,694            45,797             37,492
   of a change in accounting
   principle, net
Cumulative effect of a change in
   accounting principle, net                                   --                  --            (2,220)                --
                                                ------------------  ------------------ -----------------  -----------------
Net income                                      $          22,583   $          20,694  $         43,577   $         37,492
                                                ==================  ================== =================  =================

Basic earnings per share:
Income before cumulative effect of
   a change in accounting principle             $            0.55   $            0.50  $           1.10   $           0.88
Cumulative effect of a change in
   accounting principle, net                                   --                  --             (0.05)                --
                                                ------------------  ------------------ -----------------  -----------------
Net income                                      $            0.55   $            0.50  $            1.05   $           0.88
                                                ==================  ================== =================  =================
Diluted earnings per share:
Income before cumulative effect of
   a change in accounting principle             $            0.54   $            0.48  $           1.08   $           0.86
Cumulative effect of a change in
   accounting principle, net                                   --                  --             (0.05)                --
                                                ------------------  ------------------ -----------------  -----------------
Net income                                      $            0.54   $            0.48  $           1.03   $           0.86
                                                ==================  ================== =================  =================
Cash dividends declared per share
   of common stock                              $            0.14   $            0.13  $           0.42   $           0.26
                                                ==================  ================== =================  =================

                                   See accompanying notes to the consolidated financial statements.


6

                                                                                                          


                       ALBEMARLE CORPORATION AND SUBSIDIARIES
                 CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
                             (Dollars In Thousands)
                                   (Unaudited)



                                                            Three Months Ended                    Six Months Ended
                                                                 June 30,                             June 30,
                                                    ----------------  -----------------  -----------------  -----------------
                                                         2003               2002               2003               2002
                                                    ----------------  -----------------  -----------------  -----------------
Net income                                          $        22,583    $        20,694    $        43,577    $        37,492
Other comprehensive income (loss),
   net of tax:
   Unrealized gain (loss) on securities
      available for sale                                         24               (123)                 6                (96)
   Unrealized loss on hedging
      derivatives                                               (30)                 -                (30)                 -
   Foreign currency translation                               7,520             12,380             10,788             11,429
                                                    ----------------  -----------------  -----------------  -----------------
Other comprehensive income                                    7,514             12,257             10,764             11,333
                                                    ----------------  -----------------  -----------------  -----------------
Comprehensive income                                $        30,097    $        32,951    $        54,341    $        48,825
                                                    ================  =================  =================  =================





                See accompanying notes to the consolidated financial statements.



7

                                                                                                              



                     ALBEMARLE CORPORATION AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                             (Dollars In Thousands)
                                   (Unaudited)

                                                                                               Six Months Ended June 30,
                                                                                               2003                 2002
                                                                                       -----------------     -----------------
Cash and cash equivalents at beginning of year                                           $       37,636       $       30,585
                                                                                       -----------------     ----------------
Cash flows from operating activities:
   Net income                                                                                    43,577               37,492
   Cumulative effect of a change in accounting principle, net (a)                                 2,220                    -
                                                                                       -----------------     ----------------
   Income before cumulative effect of a change in accounting principle                           45,797               37,492
   Adjustments to reconcile net income before cumulative effect of a change in
      accounting principle, net to cash flows from operating activities:
        Depreciation and amortization                                                            40,779               40,475
        Working capital decrease, net of the effects of acquisition                               9,812                7,959
        Increase in income tax receivable                                                       (11,278)                   -
   Other, net                                                                                       223               (5,198)
                                                                                       -----------------     ----------------
      Net cash provided from operating activities                                                85,333               80,728
                                                                                       -----------------     ----------------

Cash flows from investing activities:
  Acquisition of assets                                                                         (26,579)                   -
  Capital expenditures                                                                          (19,278)             (19,267)
  Proceeds from liquidation of nonmarketable security                                             4,419                    -
  Investments in joint ventures and nonmarketable securities                                     (6,410)              (3,164)
  Restricted cash from industrial revenue bond proceeds                                               -                1,741
                                                                                       -----------------     ----------------
       Net cash used in investing activities                                                    (47,848)             (20,690)
                                                                                       -----------------     ----------------

Cash flows from financing activities:
  Proceeds from borrowings                                                                       47,332              103,995
  Repayments of long-term debt                                                                  (52,441)             (64,969)
  Purchases of common stock                                                                     (13,474)             (92,943)
  Dividends paid to shareholders                                                                (11,664)             (11,316)
  Dividends paid to minority interest                                                            (1,501)                   -
  Proceeds from exercise of stock options                                                           372                2,156
                                                                                       -----------------     ----------------
     Net cash used in financing activities                                                      (31,376)             (63,077)
                                                                                       -----------------     ----------------
Net effect of foreign exchange on cash and cash equivalents                                       6,248                5,858
                                                                                       -----------------     ----------------

Increase in cash and cash equivalents                                                            12,357                2,819
                                                                                       -----------------     ----------------

Cash and cash equivalents at end of period                                               $       49,993      $        33,404
                                                                                       =================     ================

(a) Supplemental noncash disclosures due to a cumulative change in accounting principle:
    Increase in property, plant and equipment                                            $       (6,520)      $            -
    Increase in accumulated depreciation                                                          3,083                    -
    Increase in other noncurrent liabilities                                                      6,922                    -
    Decrease in deferred tax liabilities                                                         (1,265)                   -
                                                                                       -----------------     ----------------
    Cumulative effect of a change in accounting principle, net                           $        2,220       $            -
                                                                                       =================     ================

                                    See accompanying notes to the consolidated financial statements.


8


`
ALBEMARLE  CORPORATION  AND  SUBSIDIARIES
NOTES TO THE  CONSOLIDATED  FINANCIAL STATEMENTS
(In Thousands Except Share and Per-Share Amounts)
(Unaudited)

1.  In the  opinion  of  management,  the  accompanying  consolidated  financial
statements  of  Albemarle   Corporation   and  its  wholly  owned   subsidiaries
("Albemarle"  or the  "Company")  contain all  adjustments  necessary for a fair
presentation,  in all material respects, of the Company's consolidated financial
position as of June 30, 2003, and December 31, 2002, the consolidated results of
operations and  comprehensive  income for the three- and six-month periods ended
June 30, 2003, and 2002, and condensed consolidated cash flows for the six-month
periods  ended June 30,  2003,  and 2002.  All  adjustments  are of a normal and
recurring  nature.  These  consolidated  financial  statements should be read in
conjunction  with  the  consolidated  financial  statements  and  notes  thereto
included in the  Company's  2002 Annual Report & Form 10-K as amended on May 12,
2003.  The December 31, 2002  consolidated  balance  sheet data was derived from
audited financial  statements,  but does not include all disclosures required by
generally  accepted  accounting  principles.  The results of operations  for the
three- and six-month periods ended June 30, 2003, are not necessarily indicative
of the results to be expected for the full year. Certain  reclassifications have
been made to the accompanying  consolidated  financial  statements and the notes
thereto to conform to the current presentation.

2. Long-term debt consists of the following:

                                      June 30,                  December 31,
                                        2003                        2002
                                ---------------------      ---------------------
Variable-rate bank loans        $             159,040      $             163,015
Industrial revenue bonds                       11,000                     11,000
Foreign borrowings                              4,362                      5,470
Miscellaneous                                     957                        995
                                ---------------------      ---------------------
    Total                                     175,359                    180,480
Less amounts due within one year                  176                        343
                                ---------------------      ---------------------
    Long-term debt              $             175,183      $             180,137
                                =====================      =====================



3. Cost of goods sold includes  foreign exchange  transaction  gains of $748 and
$283 and $809 and $1,074 for the three-  and  six-month  periods  ended June 30,
2003 and 2002, respectively.

9


ALBEMARLE  CORPORATION  AND  SUBSIDIARIES
NOTES TO THE  CONSOLIDATED  FINANCIAL STATEMENTS
(In Thousands Except Share and Per-Share Amounts)
(Unaudited)

4. Basic and diluted  earnings  per share for the three- and  six-month  periods
ended June 30, 2003 and 2002, are calculated as follows:

                                                                                                            

                                                                  Three Months Ended                    Six Months Ended
                                                                       June 30,                             June 30,
                                                         ----------------------------------- ------------------------------------
Basic earnings per share                                       2003               2002               2003              2002
------------------------                                 ---------------- ------------------ -----------------  -----------------
Numerator:
Income before cumulative effect of a change in
   accounting principle                                           22,583             20,694            45,797             37,492
Cumulative effect of a change in accounting
   principle, net                                                     --                 --            (2,220)                --
                                                         ---------------- ------------------ -----------------  -----------------
Income available to stockholders, as reported            $        22,583   $         20,694   $        43,577   $         37,492
                                                         ================ ================== =================  =================

Denominator:
Average number of shares of common stock
   outstanding                                                    41,208             41,618            41,352             42,528
                                                         ================ ================== =================  =================
Basic earnings per share:
Income before cumulative effect of a change in
   accounting principle                                  $          0.55  $            0.50  $           1.10   $           0.88
Cumulative effect of a change in accounting
   principle, net                                                     --                 --             (0.05)                --
                                                         ---------------- ------------------ -----------------  -----------------
Basic earnings per share                                 $          0.55  $            0.50  $           1.05   $           0.88
                                                         ================ ================== =================  =================

Diluted earnings per share
--------------------------
Numerator:
Income before cumulative effect
   of a change in accounting principle                   $        22,583  $          20,694  $         45,797   $         37,492
Cumulative effect of a change in accounting
   principle, net                                                     --                 --            (2,220)                --
                                                         ---------------- ------------------ -----------------  -----------------
Income available to shareholders, as reported            $        22,583  $          20,694  $         43,577   $         37,492
                                                         ================ ================== =================  =================

Denominator:
Average number of shares of common stock
   outstanding                                                    41,208             41,618            41,352             42,528
Shares issuable upon exercise of stock options
   and other common stock equivalents                                838              1,204               814                978
                                                         ---------------- ------------------ -----------------  -----------------
Total shares                                                      42,046             42,822            42,166             43,506
                                                         ================ ================== =================  =================

Diluted earnings per share:
Income before cumulative effect of a change in
   accounting principle                                  $          0.54  $            0.48  $           1.08   $           0.86
Cumulative of a change in accounting principle,
   net                                                                --                 --             (0.05)                --
                                                         ---------------- ------------------ -----------------  -----------------
Diluted earnings per share                               $          0.54     $         0.48     $        1.03     $         0.86
                                                         ================ ================== =================  =================


10


ALBEMARLE CORPORATION AND SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In Thousands Except Share and Per-Share Amounts)
(Unaudited)

5. The following table reflects the changes in consolidated shareholders' equity
from December 31, 2002 through June 30, 2003:

                                                                                                        
                                                                                    Accumulated                          Total
                                                                   Additional          Other                            Share-
                                             Common Stock            Paid-In       Comprehensive       Retained        holders'
                                         Shares        Amounts       Capital       Income (Loss)       Earnings         Equity
-----------------------------------------------------------------------------------------------------------------------------------
Balance at December 31, 2002            41,692,074  $       417  $       2,286   $        (4,514)    $    571,551   $      569,740
Net income                                       -            -              -                 -           43,577           43,577
Foreign currency translation, net                -            -              -            10,788                -           10,788
Change in unrealized gain on
   marketable equity securities,
   net                                           -            -              -                 6                -                6
Change in unrealized (loss) on
   hedging derivatives, net                      -            -              -               (30)               -              (30)
Cash dividends declared                          -            -              -                 -          (17,308)         (17,308)
Shares repurchased and retired            (528,600)          (5)        (2,999)                -          (10,210)         (13,214)
Shares repurchased upon
   exercise of stock options                (9,794)            -          (260)                -                -             (260)
Shares issued upon exercise of
   stock options                            27,766            -            372                 -                -              372
Issuance of incentive award
   stock                                    33,536            -            729                 -                -              729
                                      ------------    ----------   -----------   ---------------     ------------   --------------
Balance at June 30, 2003                41,214,982  $        412  $        128   $         6,250     $    587,610   $      594,400
                                      ============  ============  ============   ===============     ============   ==============



6. Cash dividends  declared for the six-month period ended June 30, 2003 totaled
42 cents per share,  which includes  dividends of 14 cents per share declared on
January 31, 2003, paid on April 1, 2003; March 26, 2003, payable on July 1, 2003
and June 25, 2003, payable on October 1, 2003.

7. The significant  differences  between the U.S.  Federal  statutory income tax
rate on pretax  income  and the  effective  income  tax rate for the  three- and
six-month periods ended June 30, 2003 and 2002, respectively, are as follows:

                                                                                                     
                                                                        % of Income Before Income Taxes
                                                     -----------------------------------------------------------------------
                                                           Three Months Ended                     Six Months Ended
                                                                June 30,                               June 30,
                                                     -----------------------------------------------------------------------
                                                          2003               2002             2003               2002
                                                          ----               ----             ----               ----
Federal statutory rate                                    35.0%             35.0%            35.0%              35.0%
Revaluation of reserve requirements                      (28.7)               -              (13.1)               -
Federal income tax settlement                               -               (9.5)            (8.9)              (5.0)
Extraterritorial income exclusion                         (2.4)             (2.4)            (2.5)              (2.4)
State taxes, net of federal tax benefit                    0.9               1.0              0.9                1.0
Depletion                                                 (1.9)             (1.7)            (1.8)              (1.8)
Other, net                                                (1.1)             (1.2)            (0.6)              (1.4)
                                                     ----------------  ----------------  -----------------  ----------------
Effective income tax rate                                 1.8%              21.2%             9.0%              25.4%
                                                     ================  ================  =================  ================

11

ALBEMARLE CORPORATION AND SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In Thousands Except Share and Per-Share Amounts)
(Unaudited)

During the quarter ended June 30, 2003, the Company received notification of the
finalization of the Internal Revenue Service's examination of its Federal income
tax returns for the years ended  December  31, 1998 and 1999.  As a result,  the
Company  evaluated  its  tax reserves  and  released  $6.6 million to earnings.

In March 2003,  the Company  recorded a  receivable  for an income tax refund of
$11,083. The refund related to the Internal Revenue Service's examination of the
Company's 1996 and 1997 tax returns. In addition,  the Company recorded interest
income of $195 ($124 after  income  taxes) for the three  months  ended June 30,
2003. The net effect of the refund on the  Consolidated  Statement of Income for
the six month  period  ended June 30,  2003  amounted  to $7,216 or 17 cents per
diluted share, including interest of $4,308 ($2,744 after income taxes).

On April 25, 2002,  the Company  received a favorable tax  settlement of $3,777,
including  interest of $1,285 after  income  taxes,  from the  Internal  Revenue
Service on its claims for  adjustment of export  benefits for the years 1994 and
1995.

8. On January 21, 2003, Albemarle acquired Ethyl Corporation's  ("Ethyl's") fuel
and  lubricant  antioxidants  working  capital,  patents and other  intellectual
property for approximately $26,579. In addition, Albemarle agreed pay to Ethyl a
total of $1,500 ($750  outstanding  as of June 30) in  additional  consideration
during 2003 if Ethyl's  purchases of  antioxidant  products  from  Albemarle and
Albemarle's  sales  of  antioxidant  products  to  third  parties  for  fuel and
lubricant additive use meet certain specified performance criteria. A summary of
the final purchase price allocation is as follows:

Current assets                                                        $   4,685
Property, plant and equipment                                               300
Other assets                                                                 50
Intangibles (range of lives: 1 - 35 years)                               24,161
In-process R&D                                                              250
Current liabilities                                                      (2,230)
Noncurrent liabilities                                                     (637)
                                                              ------------------
Net cash paid                                                           $26,579
                                                              ==================

9. During the first quarter of 2002,  the Company  recorded a special  charge of
$850 ($541 after income taxes) through an involuntary separation program. In the
fourth  quarter of 2002, the Company  continued its efforts to reduce  operating
costs through another  separation  adjustment of $700 ($446 after income taxes).
The 2002  program  impacted  a total of 18  salaried  employees  throughout  the
Company. The following table summarizes the total special charges outlined above
related to the 2002 involuntary separation program:

12


ALBEMARLE CORPORATION AND SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In Thousands Except Share and Per-Share Amounts)
(Unaudited)

                                                           Six Months Ended
                                                            June 30, 2003
                                                    ----------------------------
Beginning accrual balance, January 1, 2003        $                         761
Workforce reduction charges, net                                              -
Payments                                                                    523
Amounts reversed to income                                                  210
                                                    ----------------------------
Ending accrual balance                            $                          28
                                                    ============================

10. During the first quarter  ended March 31, 2002,  the Company  recorded a net
charge of $2,000  ($1,274  after income  taxes) to cost of sales that related to
the  discontinuance  of  product  support  for and the  withdrawal  from a water
treatment  venture.  The Company's balance sheet at June 30, 2003,  included the
accrual of a probable  insurance recovery of $5,781 in other assets and deferred
charges and an accrual totaling $500 in accrued expenses.

11. On February 13, 2002, the Company completed the purchase of 4,000,000 shares
of its common  stock from Bruce C.  Gottwald  and his related  immediate  family
interests for an aggregate  price of $92,680.  At that time, the Company retired
the shares and  reduced  retained  earnings  by $40,979  after  eliminating  the
balance in additional paid-in capital.

12. The net change in the Company's recorded  environmental  liabilities at June
30, 2003 follows:
Beginning balance at December 31,2002                     $              32,144
Net additions                                                               325
Expenditures                                                               (716)
Foreign exchange                                                          1,865
SFAS No. 143 reclassification                                            (4,053)
                                                          ----------------------
Ending balance at June 30, 2003                           $              29,565
                                                          ======================

Recorded  liabilities  decreased $2,579 primarily due to the reclassification of
certain  environmental  obligations  previously  accounted  for under  Financial
Accounting  Standards  Board  ("FASB")  Statement  of  Position  96-1  to  other
noncurrent  liabilities  upon  adoption of  Statement  of  Financial  Accounting
Standards ("SFAS") No. 143. See Footnote 14.

The amounts  recorded  represent  management's  best  estimate of the  Company's
future  remediation and other anticipated  environmental  costs relating to past
operations.  Although it is difficult to quantify the potential financial impact
of compliance with environmental protection laws, management estimates, based on
the latest available information,  there is a reasonable possibility that future
environmental remediation costs associated with the Company's

13

ALBEMARLE CORPORATION AND SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In Thousands Except Share and Per-Share Amounts)
(Unaudited)

past  operations,  in  excess  of  amounts  already  recorded,  could  be  up to
approximately  $9,760 before income taxes, to be incurred over a period of time.
However,  the  Company  believes  that  any  sum it may  be  required  to pay in
connection  with  environmental  remediation  matters  in excess of the  amounts
recorded  should  occur  over a period of time and  should  not have a  material
adverse effect upon results of operations,  financial condition or cash flows of
the Company on a consolidated  basis but could have a material adverse impact in
a particular quarterly reporting period.

13.  The  Company  is a  global  manufacturer  of  specialty  polymer  and  fine
chemicals,  currently grouped into two operating segments: Polymer Chemicals and
Fine  Chemicals.  The  operating  segments were  determined  based on management
responsibility.  The Polymer Chemicals segment is comprised of flame retardants,
catalysts  and polymer  additives.  The Fine  Chemicals  segment is comprised of
agrichemicals,  pharmachemicals,  fine chemistry  services and intermediates and
performance  chemicals.  Segment  data  includes  intersegment  transfers of raw
materials at cost and foreign exchange  transaction gains and losses, as well as
allocations  for certain  corporate  costs.  The  corporate  and other  expenses
include  certain   corporate-related  items  not  allocated  to  the  reportable
segments.

                                                                                                            


                                                                             Three Months Ended June 30,
                                               -----------------------------------------------------------------------------------
Summary of Segment Results                                        2003                                      2002*
                                               -----------------------------------------------------------------------------------
                                                      Revenues              Income               Revenues             Income
                                               --------------------  ------------------   -------------------- -------------------
Polymer Chemicals                               $          150,128    $         18,750     $          142,955   $          17,927
Fine Chemicals                                             119,348              11,769                109,751              13,290
                                               --------------------  ------------------   -------------------- -------------------
   Segment totals                               $          269,476              30,519     $          252,706              31,217
                                               ====================                       ====================
Corporate and other expenses                                                   (5,949)                                    (5,998)
                                                                     ------------------                        -------------------
   Operating profit                                                             24,570                                     25,219
Interest and financing expenses                                                 (1,257)                                    (1,235)
Other income and (expenses), including
  minority interest                                                               (316)                                     2,276
                                                                     ------------------                        -------------------
Income before income taxes                                            $         22,997                          $          26,260
                                                                     ==================                        ===================

                                                                             Six Months Ended June 30,
                                               -----------------------------------------------------------------------------------
Summary of Segment Results                              2003                                                2002*
                                               ----------------------------------------   ----------------------------------------
                                                     Revenues              Income               Revenues             Income
                                               --------------------  ------------------   -------------------- -------------------
Polymer Chemicals                               $          297,356    $         35,099     $          265,122   $          29,851
Fine Chemicals                                             237,690              25,156                219,406              29,598
                                               --------------------  ------------------   -------------------- -------------------
   Segment totals                               $          535,046              60,255     $          484,528              59,449
                                               ====================                       ====================
Corporate and other expenses                                                   (10,611)                                    (9,800)
                                                                     ------------------                        -------------------
   Operating profit                                                             49,644                                     49,649
Interest and financing expenses                                                 (2,594)                                    (2,460)
Other income and (expenses), including
  minority interest                                                              3,257                                      3,068
                                                                     ------------------                        -------------------
Income before income taxes                                            $         50,307                          $          50,257
                                                                     ==================                        ===================
* See footnote 15 for an explanation of the restatements for 2002.


14

ALBEMARLE CORPORATION AND SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In Thousands Except Share and Per-Share Amounts)
(Unaudited)

14. On January 1, 2003, the Company adopted SFAS No. 143,  "Accounting for Asset
Retirement  Obligations," which addresses financial accounting and reporting for
obligations associated with the retirement of tangible long-lived assets and the
associated  asset  retirement  costs.  At the  time  of  adoption,  the  Company
identified  certain  assets for which there are future  retirement  obligations.
These future obligations are comprised  primarily of the cost of closing various
facilities  and of  capping  brine  wells.  The  financial  statement  impact at
adoption of this Statement on the Company's consolidated statements of income is
reflected as a cumulative effect of a change in accounting  principle  amounting
to $2,220, net of taxes of $1,265.

15. On January 1, 2003,  the Company  adopted  the  provisions  of the  Emerging
Issues  Task Force  ("EITF")  Issue No.  00-10,  "Accounting  for  Shipping  and
Handling  Fees and  Costs".  The Company  reclassified  all costs  incurred  for
shipping  and  handling  from a reduction  of net sales to cost of sales for the
periods reflected herein.  The presentation of prior period information has been
reclassified to conform to the current year  presentation.  On May 12, 2003, the
Company  filed an  amendment  to its Form 10-K for the year 2002 to reflect  the
adoption  of this EITF.  This  change  does not have an effect on gross  profit,
operating profit or net income. Shipping and handling costs reclassified totaled
$7,655 and $14,849 for the three- and  six-month  periods  ended June 30,  2002,
respectively.

16. During January 2003, the FASB issued  Interpretation No. 46 ("FIN 46" or the
"Interpretation"),    "Consolidation   of   Variable   Interest   Entities,   an
Interpretation of ARB No. 51", which provides guidance on the identification of,
and financial  reporting  for,  entities over which control is achieved  through
means other than voting  rights;  such  entities are known as  variable-interest
entities ("VIEs"). This interpretation applies immediately to VIEs created after
January 31, 2003 and to VIEs in which an  enterprise  obtains an interest  after
that date.  The Company did not create a VIE during this period.  FIN 46 applies
to VIEs in the first  fiscal  year or interim  period  beginning  after June 15,
2003, in which a Company holds the interest  acquired  before  February 1, 2003.
The  Company is  evaluating  the effect  that FIN 46 will have on the  Company's
consolidated financial statements effective July 1, 2003.

17. SFAS No. 123,  "Accounting for Stock-Based  Compensation,"  ("SFAS No. 123")
encourages,   but  does  not  require,   companies  to  record  at  fair  value,
compensation cost for stock-based  employee  compensation plans. The Company has
chosen to continue to account for stock-based  compensation  using the intrinsic
value  method  prescribed  in  Accounting   Principles  Board  Opinion  No.  25,
"Accounting  for Stock Issued to Employees,"  ("APB Opinion No. 25") and related
interpretations. Under the intrinsic method, compensation cost for stock options
is measured as the excess,  if any, of the quoted  market price of the Company's
stock at the date of the grant over the amount an  employee  must pay to acquire
the stock. If compensation  cost had been determined  based on the fair value at
the grant date under the plans  consistent  with the method of SFAS No. 123, the
Company's  net income and  earnings per share would have been reduced to the pro
forma amounts indicated as follows:
15

ALBEMARLE CORPORATION AND SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In Thousands Except Share and Per-Share Amounts)
(Unaudited)


                                                                                                               
                                                                                                     Three Months Ended
                                                                                                          June 30,
                                                                                         -----------------------------------------
                                                                                                  2003                  2002
                                                                                         -------------------   -------------------
Net income                                                       as reported              $          22,583     $          20,694
                                                                 pro forma                $          22,146     $          20,391
---------------------------------------------------------------  -----------------       -------------------   -------------------

Basic earnings per share on net income                           as reported              $            0.55     $            0.50
                                                                 pro forma                $            0.54     $            0.49
---------------------------------------------------------------  -----------------       -------------------   -------------------

Diluted earnings per share on net income                         as reported              $            0.54     $            0.48
                                                                 pro forma                $            0.53     $            0.47
---------------------------------------------------------------  -----------------       -------------------   -------------------

                                                                                                      Six Months Ended
                                                                                                          June 30,
                                                                                         -----------------------------------------
                                                                                                2003                  2002
                                                                                         -------------------   -------------------
Income before cumulative effect of a change                      as reported              $          45,797     $          37,492
   in accounting principle, net                                  pro forma                $          44,909     $          36,757
---------------------------------------------------------------  -----------------       -------------------   -------------------

Net income                                                       as reported              $          43,577     $          37,492
                                                                 pro forma                $          42,689     $          36,757
---------------------------------------------------------------  -----------------       -------------------   -------------------

Basic earnings per share on income before
   cumulative effect of a change in                              as reported              $            1.10     $            0.88
   accounting principle, net                                     pro forma                $            1.09     $            0.86
---------------------------------------------------------------  -----------------       -------------------   -------------------

Basic earnings per share on                                      as reported              $            1.05     $            0.88
   net income                                                    pro forma                $            1.03     $            0.86
---------------------------------------------------------------  -----------------       -------------------   -------------------

Diluted earnings per share on income before
   cumulative effect of a change in                              as reported              $            1.08     $            0.86
   accounting principle, net                                     pro forma                $            1.06     $            0.84
---------------------------------------------------------------  -----------------       -------------------   -------------------

Diluted earnings per share on net income                         as reported              $            1.03     $            0.86
                                                                 pro forma                $            1.01     $            0.84
---------------------------------------------------------------  -----------------       -------------------   -------------------



The weighted  average fair values of options  granted during the three- and six-
month periods ending June 30, 2003 and 2002 were $7.77 and $9.65,  and $7.77 and
$10.73, respectively.  The fair value of each option is estimated on the date of
grant  using  the   Black-Scholes   option-pricing   model  with  the  following
weighted-average  assumptions  used for  options  granted in the three- and six-
months ended June 30, 2003 and 2002,  respectively:  dividend yield 2.54% in all
periods;  expected  volatility  of 31.23%  and  31.03%, and  31.23% and  31.03%;
risk-free  interest  rate of 4.21% and 4.20%,and  4.21% and 4.17%;  and expected
lives of eight years.

16

ALBEMARLE CORPORATION AND SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In Thousands Except Share and Per-Share Amounts)
(Unaudited)

18.  Effective  June 30, 2003,  Albemarle  adopted SFAS No. 149,  "Amendment  of
Statement 133 on Derivative  Instruments and Hedging Activities." This statement
amends and clarifies financial  accounting and reporting for derivatives and for
hedging  activities under SFAS No. 133,  "Accounting for Derivative  Instruments
and Hedging  Activities."  This standard  will have an immaterial  impact on the
Company's financial statements.

19. In May 2003, the Financial Accounting Standards Board (FASB) issued SFAS No.
150,   "Accounting  for  Certain   Instruments  with   Characteristics  of  Both
Liabilities  and  Equity."  This  standard   requires  that  certain   financial
instruments  embodying  an  obligation  to  transfer  assets or to issue  equity
securities  be  classified  as  liabilities.   It  is  effective  for  financial
instruments  entered  into or modified  after May 31,  2003,  and  otherwise  is
effective July 1, 2003. At the time of adoption,  this standard has no impact on
the Company's financial statements.

20. On July 24,  2003,  the Company  finalized  an  agreement  with Rhodia SA to
acquire  Rhodia's  global  organophosphorus  and  ammonium  polyphosphate  flame
retardants  business for applications in rigid and flexible  polyurethane foams.
This addition to Albemarle's  polymer  business  segment is expected to generate
sales  of  approximately  $65  million  in its  first  year.  As  part  of  this
transaction,  Albemarle  is  acquiring a production  site in  Avonmouth,  United
Kingdom.  Albemarle  will be supplied with flame  retardants  and  intermediates
manufactured  at Rhodia's sites in  Charleston,  S.C., and Oldbury and Widnes in
the United  Kingdom.  About 75  employees  will join  Albemarle  as part of this
transaction. The allocation of the purchase price is expected to be completed by
the end of the fourth quarter of 2003.


17


ITEM 2.  Management's  Discussion  and  Analysis  of Results of  Operations  and
--------------------------------------------------------------------------------
Financial Condition and Additional Information -
------------------------------------------------

The following is  management's  discussion  and analysis of certain  significant
factors  affecting the results of operations  of Albemarle  Corporation  and its
subsidiaries ("Albemarle" or the "Company"),  during the periods included in the
accompanying  consolidated  statements  of income and  changes in the  Company's
financial condition since December 31, 2002.

Some of the  information  presented in the following  discussion  may constitute
forward-looking   statements  within  the  meaning  of  the  Private  Securities
Litigation Reform Act of 1995. Such forward-looking  statements are based on our
current  expectations,  which are in turn  based on our  reasonable  assumptions
within the bounds of its knowledge of its business and operations.  There can be
no assurance,  however,  that our actual results will not differ materially from
the results and  expectations in the  forward-looking  statements.  Factors that
could cause actual results to differ materially include, without limitation, the
timing  of  orders  received  from  customers,  the gain or loss of  significant
customers,  competition from other manufacturers,  changes in the demand for our
products, increases in the cost of products, increases in the cost of energy and
raw materials  (notably,  ethylene,  chlorine and natural  gas),  changes in our
markets in general,  fluctuations in foreign currencies,  changes in new product
introductions  resulting in increases in capital project  requests and approvals
leading  to  additional  capital  spending,  changes  in laws  and  regulations,
unanticipated  claims or  litigation,  the inability to obtain current levels of
product  or  premises  liability  insurance  or the  denial  of  such  coverage,
political  unrest  affecting  the  global  economy  and  changes  in  accounting
standards.  The  Company  assumes  no  obligation  to provide  revisions  to any
forward-looking  statements  should  circumstances  change,  except as otherwise
required by securities and other applicable laws.

Results of Operations
---------------------
Second Quarter 2003 Compared with Second Quarter 2002
-----------------------------------------------------

Net sales for second quarter 2003 of $269.5 million, a record second quarter for
the Company since the sale of the olefins businesses in March 1996, were up 6.6%
or $16.8  million  from  second  quarter  2002 net sales of $252.7  million,  as
restated. The increase in net sales was primarily due to the favorable impact of
foreign  exchange ($16.4  million),  the addition of the fuel and lube additives
products  acquired in mid-January  2003 from Ethyl  Corporation  ($6.1 million),
higher  shipments in performance  chemicals ($3.3 million) and favorable  prices
and  higher  shipments  in  fine  chemistry  services  and  intermediates  ($2.5
million),  offset,  in part by lower  shipments in catalysts and additives ($4.6
million), flame retardants ($2.8 million) and pharma actives ($2.2 million), and
unfavorable pricing in performance chemicals ($1.5 million).

The gross profit margin decreased to 21.7% in second quarter 2003 from 23.0% for
the corresponding  period in 2002. Second quarter 2003 operating profit was down
2.6% or $0.6 million from second quarter 2002 operating  profit primarily due to
higher  energy and raw  material  costs  ($7.0  million),  lower  pricing  ($1.3
million) and unfavorable  manufacturing costs ($1.0 million) offset, in part, by
the overall effects of foreign  exchange ($4.0 million),  higher shipments ($2.7
million)  and the  favorable  impact  of the fuel and  lube  additives  products
acquired from Ethyl ($1.9 million).

18

Selling,   general  and  administrative   ("SG&A")  expenses  and  research  and
development  ("R&D")  expenses  increased  2.8% or $0.9  million  in the  second
quarter of 2003 versus  second  quarter 2002  primarily  due to the  unfavorable
impact of foreign exchange.  As a percentage of net sales, SG&A expenses and R&D
expenses were 12.6% in 2003 versus 13.0%, as restated, in the 2002 quarter.

Operating  Segments
Net sales by reportable  business  operating segment for the
second quarter period ended June 30, 2003 and 2002 are as follows:

                                                          Net Sales
                                                       (In Thousands)
                                         ---------------------------------------
                                                  2003                   2002 *
                                         -----------------     -----------------
     Polymer Chemicals                           $150,128              $142,955
     Fine Chemicals                               119,348               109,751
                                         -----------------     -----------------
     Segment Totals                              $269,476              $252,706
                                         =================     =================

* Restated to reflect shipping and handling costs in conformity with EITF 00-10.

Polymer Chemicals' net sales for the second quarter 2003 increased 5.0%, or $7.2
million,  from second  quarter 2002 net sales.  The increase is primarily due to
the favorable  impact of foreign  exchange ($8.7  million),  the addition of the
fuel and lube  additives  products  acquired  in  mid-January  2003  from  Ethyl
Corporation  ($6.1 million) offset, in part, by lower shipments in catalysts and
additives ($4.6 million) and flame retardants ($2.8 million).

Fine Chemicals' net sales for second quarter 2003 increased 8.7% or $9.6 million
from second quarter 2002. The increase is primarily due to the favorable  impact
of foreign exchange ($7.7 million),  higher  shipments in performance  chemicals
($3.3  million) and  favorable  prices and higher  shipments  in fine  chemistry
services and intermediates ($2.5 million) offset, in part, by lower shipments in
pharma actives ($2.2 million) and unfavorable  pricing in performance  chemicals
($1.5 million).

Operating profit by reportable business operating segment for the second-quarter
period ended June 30, 2003, and 2002 is as follows:

                                                    Operating Profit
                                                     (In Thousands)
                                          --------------------------------------
                                                  2003                 2002
                                          ----------------     -----------------
     Polymer Chemicals                            $18,750               $17,927
     Fine Chemicals                                11,769                13,290
                                          ----------------     -----------------
     Segment Totals                                30,519                31,217
     Corporate and Other Expenses                  (5,949)               (5,998)
                                          ----------------     -----------------
     Operating Profit                             $24,570               $25,219
                                          ================     =================


19


Polymer  Chemicals'  second quarter 2003 segment operating profit was up 4.6% or
$0.8 million from second  quarter 2002  primarily due to the overall  effects of
foreign exchange ($3.0 million),  favorable  manufacturing  costs ($1.9 million)
and the favorable impact of the fuel and lube additives  products acquired ($1.9
million),  offset,  in part, by unfavorable  raw material and energy costs ($3.7
million), lower shipments ($2.0 million) and lower pricing ($0.3 million).

Fine Chemicals'  second quarter 2003 segment operating profit decreased 11.4% or
$1.5 million from second quarter 2002 primarily due to unfavorable manufacturing
costs ($3.4  million),  unfavorable raw material and energy costs ($3.3 million)
and lower prices ($0.9 million)  partially offset by favorable product mix ($4.7
million) and the overall effects of foreign exchange ($1.4 million).

Corporate and other  expenses for the second  quarter of 2003  decreased 0.8% or
$0.1 million from second quarter 2002.

Interest  and  Financing  Expenses
Interest  and  financing  expenses  for second  quarter  2003  amounted  to $1.3
million,  up slightly from $1.2 million in second  quarter 2002 due primarily to
higher commitment fees under the Company's new Credit Agreement offset, in part,
by lower interest rates on lower average outstanding debt.

Other Income and (Expenses), Including Minority Interest
Other  income and  (expenses)  for the second  quarter  2003  amounted to $(0.3)
million,  down $2.6 million from the 2002 corresponding  period primarily due to
the absence of interest income of $2.0 million from the Internal Revenue Service
income tax settlement received in 2002.

Income Taxes
The second quarter 2003  effective  income tax rate was 1.8% down from 21.2% for
the  corresponding  period in 2002.  The 2003 period  benefited from a favorable
income  tax  adjustment  of  $6.6  million  due to the  revaluation  of  reserve
requirements  as the IRS  closed  audits  related  to tax years 1998 and 1999 in
mid-2003. The 2002 second quarter included a favorable IRS income tax settlement
of $2.5 million  which  related to export  benefits for the years 1994 and 1995.
The Company  expects to maintain a tax rate of about 30.0% for the  remainder of
2003.

Results of Operations
---------------------
Six Months 2003 Compared with Six Months 2002
---------------------------------------------

Net sales for the first six months of 2003 amounted to $535.0 million,  up 10.4%
or $50.5  million  from net  sales  of  $484.5  million,  as  restated,  for the
corresponding  period of 2002. The increase in net sales is primarily due to the
favorable impact of foreign  exchange ($32.7 million),  the addition of the fuel
and lube additives  products acquired in mid-January 2003 from Ethyl Corporation
($11.3  million),  higher  shipments  in flame  retardants  ($8.1  million)  and
performance  chemicals ($4.5 million) and higher shipments and favorable pricing
in fine chemistry services and intermediates  ($2.9 million) offset, in part, by
lower shipments and unfavorable prices in catalysts and additives ($4.1 million)
and unfavorable prices in performance chemicals ($4.1 million).

20

The gross profit margin  decreased to 21.7% in the first six months of 2003 from
23.5%, as restated,  for the corresponding  period in 2002. The first six months
of 2003 operating  profit was  relatively  unchanged from the 2002 period due to
the overall favorable effects of foreign exchange ($7.3 million),  and favorable
production and manufacturing costs ($5.8 million), higher volumes ($4.2 million)
and the favorable impact of the fuel and lube additives  products acquired ($3.3
million),  offset,  in part, by unfavorable raw material and energy costs ($15.5
million) and lower selling prices ($6.5  million).  The first six months of 2002
includes a $2.3 million  charge to cost of sales  related to the  discontinuance
and withdrawal from a water  treatment  venture as well as a $0.9 million charge
for workforce reductions.

SG&A and R&D  increased  4.7% or $3.0  million  in the first six  months of 2003
versus  the 2002  period  primarily  due to the  unfavorable  impact of  foreign
exchange  ($2.4  million) and higher SFAS No. 2 R&D costs ($0.6  million).  As a
percentage  of net sales,  SG&A and R&D were 12.4% in the first six months  2003
versus 13.1%, as restated, in the corresponding period of 2002.

Operating Segments
Net sales by reportable  business  operating segment for the six-months  periods
ended June 30, 2003 and 2002 are as follows:
                                                         Net Sales
                                                      (In Thousands)
                                         ---------------------------------------
                                                    2003                 2002 *
                                         -----------------     -----------------
     Polymer Chemicals                           $297,356              $265,122
     Fine Chemicals                               237,690               219,406
                                         -----------------     -----------------
       Segment Totals                            $535,046              $484,528
                                         =================     =================

* Restated to reflect shipping and handling costs in conformity with EITF 00-10.

Polymer Chemicals' net sales for the first six months of 2003 increased 12.2% or
$32.2 million from the  corresponding  period in 2002. The increase is primarily
due to the favorable impact of foreign exchange ($17.9 million), the addition of
the fuel and lube additives  products  acquired in  mid-January  2003 from Ethyl
Corporation ($11.3 million), higher shipments in flame retardants ($8.1 million)
offset,  in part,  by lower  shipments and  unfavorable  prices in catalysts and
additives  ($4.1  million)  and  unfavorable  prices in flame  retardants  ($0.9
million).

Fine  Chemicals'  net sales for the first six months of 2003  increased  8.3% or
$18.3 million from the  corresponding  period in 2002. The increase is primarily
due  to the  favorable  impact  of  foreign  exchange  ($14.8  million),  higher
shipments in performance chemicals ($4.5 million) and agricultural actives ($1.3
million),  higher shipments and favorable pricing in fine chemistry services and
intermediates   ($2.9  million)  offset,  in  part,  by  unfavorable  prices  in
performance  chemicals ($4.1 million) and  agricultural and pharma actives ($1.2
million).

Operating  profit by reportable  business  operating  segment for the six-months
periods ended June 30, 2003, and 2002 is as follows:


21



                                                      Operating Profit
                                                       (In Thousands)
                                         ---------------------------------------
                                                   2003                  2002
                                         ----------------     ------------------
    Polymer Chemicals                            $35,099                $29,851
    Fine Chemicals                                25,156                 29,598
                                         ----------------     ------------------
     Segment Totals                               60,255                 59,449
    Corporate and Other Expenses                 (10,611)                (9,800)
                                         ----------------     ------------------
      Operating Profit                           $49,644                $49,649
                                         ================     ==================

Polymer  Chemicals' first six months of 2003 segment  operating profit increased
17.6% or $5.2 million from the corresponding period in 2002 primarily due to the
favorable   net  effects  of  foreign   exchange   ($6.6   million),   favorable
manufacturing  and production costs ($5.5 million),  a  reclassification  of bad
debt expense from corporate and other expenses in the 2002 period ($2.0 million)
and the favorable impact of the fuel and lube additives  products acquired ($3.3
million)  offset,  in part,  by higher  raw  material  and  energy  costs  ($8.2
million),  lower  selling  prices  ($2.2  million)  and  lower  shipments  ($1.8
million).

Fine  Chemicals'  first six months of 2003 segment  operating  profit  decreased
15.0% or $4.4 million from the  corresponding  period in 2002  primarily  due to
higher raw material and energy costs ($7.3 million),  lower selling prices ($4.7
million) and unfavorable  manufacturing costs ($2.3 million) offset, in part, by
favorable  product mix ($6.0  million),  the absence of a $2.3 million charge to
costs  of  sales  related  to the  discontinuance  and  withdrawal  from a water
treatment  venture in the 2002 period and the  favorable  net effects of foreign
exchange ($1.6 million).

Corporate  and other  expenses for the first six months of 2003 were up 8.3%, or
$0.8  million,  from the  corresponding  period  in 2002,  primarily  due to the
following adjustments that occurred in 2002 and did not recur in 2003. Excluding
the 2002 adjustments,  corporate and other expenses were down approximately $0.3
million in the first six months of 2003 due primarily to lower employee  related
costs.


                                                                                                  

                                                                          Corporate and Other Expenses
                                                                                 (In Thousands)
                                                            ----------------------------------------------------------
                                                                                                         Increase/
                                                                  2003                 2002              Decrease
                                                            -----------------    -----------------    ----------------
      Balance at June 30, 2003                                       $10,611               $9,800                $811
      Reclassification of Bad Debt Reserve
         to Polymer Chemicals Segment                                      -                2,000              (2,000)
      2002 Workforce Reduction                                             -                 (850)                850
                                                            -----------------    -----------------    ----------------
      Net Change Excluding 2002 Adjustments                          $10,611              $10,950               ($339)
                                                            =================    =================    ================



Interest and Financing  Expenses
Interest and financing  expenses for the first six months of 2003 increased $0.1
million from $2.5 million in the  corresponding  period of 2002 due primarily to
higher commitment fees under the Company's new Credit Agreement offset, in part,
by lower interest rates on lower average outstanding debt.

22

Other  Income and  (Expenses),  Including  Minority  Interest
Other income and  (expenses)  for the first six months of 2003  amounted to $3.3
million, up $0.2 million from the corresponding  period in 2002 primarily due to
an  increase in  interest  on income tax  settlements  in 2003 over 2002 of $2.3
million offset,  in part, by the full-year  effect of higher  minority  interest
related to the Stannica LLC joint venture.

Income Taxes
The effective  income tax rate for the first six months of 2003 was
9.0%,  down from  25.4% in the  corresponding  period of 2002.  The 2003  period
includes  the impact of an IRS income tax  settlement  recorded in the amount of
$4.5  million  as well as a  favorable  benefit of $6.6  million  related to the
revaluation  of reserve  requirements  as the IRS closed  audits  related to tax
years 1998 and 1999 in  mid-2003.  The 2002  period  included  an IRS income tax
settlement of $2.5 million that related to an adjustment of export  benefits for
the years 1994 and 1995.  The  Company  expects to  maintain a tax rate of about
30.0% for the remainder of 2003.


Financial Condition and Liquidity
---------------------------------

Cash and cash  equivalents at June 30, 2003,  were $50 million,  representing an
increase of $12.4 million from $37.6 million at year-end 2002.

Cash flows  provided from operating  activities of $85.3 million,  together with
$47.3 million of proceeds from  borrowings and $4.4 million of proceeds from the
liquidation of a marketable  security were used to purchase Ethyl  Corporation's
fuel and lubricant antioxidants working capital,  patents and other intellectual
property for approximately  $26.6 million,  to cover repayment of debt, purchase
approximately  500,000  shares of the  Company's  common  stock,  pay  quarterly
dividends to shareholders,  fund capital expenditures, fund investments in joint
ventures and nonmarketable securities, and increase cash and cash equivalents by
$12.4 million.  We anticipate  that cash provided from  operations in the future
will  be  sufficient  to  pay  our  operating  expenses,   satisfy  debt-service
obligations and make dividend payments.

The change in the Company's  accumulated other  comprehensive loss from December
31, 2002,  was due  primarily to net foreign  currency  translation  adjustments
(strengthening  of the Euro and  Japanese  Yen versus the U.S.  Dollar),  net of
related deferred taxes.

The  noncurrent  portion of the  Company's  long-term  debt  amounted  to $175.2
million at June 30,  2003,  compared to $180.1  million at the end of 2002.  The
Company's  long-term  debt,  including the current  portion,  as a percentage of
total  capitalization  amounted  to 22.8%  at June  30,  2003.  The  Company  is
guarantor of $26.1  million of long-term  debt, in the form of  commitments,  on
behalf of its 50-percent  owned joint venture  company,  Jordan Bromine  Company
Limited. The Company's long-term debt, including the guarantee,  as a percent of
total capitalization amounted to 25.3% at June 30, 2003.

Borrowings  under the Company's  Credit  Agreement dated September 10, 2002, are
conditioned  upon  compliance  with  the  following  financial  covenants:   (a)
consolidated  interest  coverage ratio, as defined,  must be greater or equal to
3.00:1.00,  (b)  consolidated  leverage ratio, as defined,  must be less than or
equal to 3.50:1.00,  (c) consolidated tangible domestic assets, as defined, must
be equal to or greater than $750 million for the Company to make  investments in
entities and enterprises that are organized outside the United States,  (d) with
the exception of liens specified in the Credit  Agreement,  liens may not attach
to assets with a value of more than 10% of consolidated net worth, as defined in
the  agreement.  As of June 30, 2003,  the Company is in  compliance  with these
covenants.

23

The Company's  capital  expenditures  in the first six months of 2003 were about
the same as the six-month period of 2002. For the year, capital expenditures are
forecasted to be greater than the 2002 level.  Capital spending will be financed
primarily with cash flow provided from  operations  with additional cash needed,
if any,  provided from debt. The amount and timing of any additional  borrowings
will depend on the Company's specific cash requirements.

The  Company  is subject  to  federal,  state,  local and  foreign  requirements
regulating the handling,  manufacture and use of materials (some of which may be
classified  as  hazardous  or toxic  by one or more  regulatory  agencies),  the
discharge  of  materials  into  the   environment  and  the  protection  of  the
environment.  To our  knowledge,  we are currently  complying,  and expecting to
continue to comply, in all material respects with existing  environmental  laws,
regulations, statutes and ordinances. Such compliance with federal, state, local
and foreign environmental  protection laws is not expected to have in the future
a material effect on earnings or the competitive position of Albemarle.

Among other environmental requirements,  we are subject to the federal Superfund
law,  and similar  state laws,  under which the Company may be  designated  as a
potentially  responsible  party  and  may be  liable  for a share  of the  costs
associated with cleaning up various hazardous waste sites.

Additional Information
----------------------

Summary of Critical Accounting Policies:
----------------------------------------

Consolidation
The  consolidated  financial  statements  include the accounts and operations of
Albemarle Corporation and all of its majority-owned and controlled subsidiaries.
The Company applies the equity method of accounting for investments  between 20%
and  50%  owned  over  which  we have  significant  influence.  All  significant
intercompany accounts and transactions are eliminated in consolidation. Minority
shareholder's   interest  in  controlled   subsidiaries  is  included  in  other
noncurrent  liabilities  in the  consolidated  balance  sheets  for the  periods
presented and in the consolidated  statement of income for the period ended June
30, 2003.

Estimates and Assumptions
The preparation of financial  statements in conformity  with generally  accepted
accounting principles requires management to make estimates and assumptions that
affect the reported  amounts of revenues,  expenses,  assets and liabilities and
disclosure of  contingent  assets and  liabilities  at the date of the financial
statements.  Listed below are the estimates and assumptions  that we consider to
be significant in the preparation of our financial statements.

Allowance for Doubtful Accounts -- We estimate losses for uncollectible accounts
based on the  aging of  receivables  and the  evaluation  of the  likelihood  of
success in collecting the receivables.

24

Recovery of  Long-Lived  Assets -- We evaluate  the  recovery of our  long-lived
assets on a segment basis by  periodically  analyzing our operating  results and
considering significant events or changes in the business environment.

Acquisition  Accounting -- We estimate the fair value of assets and  liabilities
when allocating the purchase price of an acquisition.

Income Taxes -- We assume the  deductibility  of certain costs in our income tax
filings and estimate the future recovery of deferred tax assets.

Legal  Accruals -- We estimate the amount of potential  exposure with respect to
litigation, claims and assessments.

Environmental  Remediation  Liabilities  -- We  estimate  and  accrue  the costs
required to  remediate a specific  site  depending  on  site-specific  facts and
circumstances.  Cost  estimates to remediate each specific site are developed by
assessing  (i) the  scope of the  Company's  contribution  to the  environmental
matter,  (ii) the scope of the anticipated  remediation and monitoring plan, and
(iii) the extent of other parties' share of responsibility.

Insurance  Accruals/Receivables  -- We record and assume the  recoverability  of
insurance  receivables  and  potential  impact of insurance  claims based on our
estimates  after  considering  advice from in-house and outside legal counsel as
well as outside consultants.

Actual results could differ  materially from the estimates and assumptions  that
we use in the preparation of our financial statements.

Revenue Recognition
Sales revenue is recognized when (1) ownership and all rewards and risks of loss
have been transferred to the buyer, (2) the price is fixed and determinable, and
(3)  collectibility is reasonably  assured.  Revenue from services is recognized
when performance of the services has been completed.

Property, Plant and Equipment
Accounts include costs of assets constructed or purchased,  related delivery and
installation costs and interest incurred on significant  capital projects during
their construction  periods.  Expenditures for renewals and betterments also are
capitalized,  but  expenditures  for repairs  and  maintenance  are  expensed as
incurred. The cost and accumulated  depreciation applicable to assets retired or
sold are removed from the respective  accounts,  and gains or losses thereon are
included in income.  Depreciation  is computed  primarily  by the  straight-line
method based on the estimated useful lives of the assets.

We evaluate  historical  and expected  undiscounted  operating cash flows of the
related  business  segments or fair value of  property,  plant and  equipment to
determine  the  future  recoverability  of any  property,  plant  and  equipment
recorded.  Recorded  property,  plant and equipment is  re-evaluated on the same
basis at the end of each accounting  period  whenever any significant  permanent
changes in business or circumstances have occurred which might impair recovery.

The costs of brine wells,  leases and royalty interests are primarily  amortized
over the estimated  average life of the field. On a yearly basis for all fields,
this approximates a units-of-production method based upon estimated reserves and
production volumes.

25

Pension Plans and Other Postretirement Benefits
Annual  costs of pension  plans are  determined  actuarially  based on Financial
Accounting  Standards Board ("FASB") Statement of Financial Accounting Standards
("SFAS") No. 87,  "Employers'  Accounting  for  Pensions"  ("SFAS No. 87").  Our
policy is to fund  U.S.  pension  plans at  amounts  not less  than the  minimum
requirements  of  the  Employee  Retirement  Income  Security  Act of  1974  and
generally for obligations under our foreign plans to deposit funds with trustees
and/or under insurance policies.  Annual costs of other postretirement plans are
accounted for based on SFAS No. 106,  "Employers'  Accounting for Postretirement
Benefits  Other than  Pensions."  Our policy is to fund  post-retirement  health
benefits  for  retirees  on  a  pay-as-you-go   basis.   There  are  significant
assumptions used in determining  amounts  including the discount rate,  expected
return on plan assets,  rate of  compensation  increase and assumed  health care
trend rate.  These  assumptions  are based on our  estimates  after  considering
advice  from  a  major  actuarial  consulting  firm  and  using  the  consistent
application of certain indexes.

Income Taxes
Deferred  income taxes result from temporary  differences in the  recognition of
income and expenses for financial and income tax reporting  purposes,  using the
liability or balance sheet method.  Such temporary  differences result primarily
from differences  between the financial statement carrying amounts and tax basis
of assets  and  liabilities  using  enacted  tax rates in effect in the years in
which the differences are expected to reverse.

Investments
We have investments in joint ventures,  nonmarketable  securities and marketable
equity securities.  The majority of our investments are in joint ventures. Since
we do not have the ability to exercise significant  influence over the operating
and  financial  policies  and are not the "primary  beneficiary"  of these joint
ventures,  they are  accounted for using the equity  method of  accounting.  The
Company's  share  of  the  investee's  (losses)  earnings  are  included  in the
consolidated  statement  of  operations  as a  component  of  other  income  and
(expenses),  including minority interest.  Investments in marketable  securities
are accounted for as  available-for-sale  securities  with changes in fair value
included in "accumulated other comprehensive income (loss)" in the shareholders'
equity  section  of  the  consolidated   balance  sheets.  Joint  ventures'  and
nonmarketable  securities'  results for immaterial  entities are estimated based
upon the  overall  performance  of the entity  where  financial  results are not
available on a timely basis.

Environmental Compliance and Remediation
Environmental   compliance   costs  include  the  cost  of   purchasing   and/or
constructing assets to prevent, limit and/or control pollution or to monitor the
environmental  status at various  locations.  These  costs are  capitalized  and
depreciated based on estimated useful lives. Environmental compliance costs also
include maintenance and operating costs with respect to pollution prevention and
control  facilities and other  administrative  costs.  Such operating  costs are
expensed as incurred.  Environmental  remediation  costs of  facilities  used in
current operations are generally immaterial and are expensed as incurred.

We accrue for environmental  remediation costs and post-remediation  costs on an
undiscounted  basis at  facilities  or off-plant  disposal  sites that relate to
existing  conditions caused by past operations in the accounting period in which
responsibility  is  established  and when the related  costs are  estimable.  In
developing  these cost  estimates,  evaluation  is given to currently  available
facts  regarding each site,  with  consideration  given to existing  technology,
presently  enacted laws and  regulations,  prior  experience in  remediation  of
contaminated  sites, the financial  capability of other potentially  responsible
parties and other factors,  subject to uncertainties  inherent in the estimation
process.  These  estimates are reviewed  periodically,  with  adjustments to the
accruals recorded as necessary.

26

Outlook
-------

Fine Chemicals
Looking ahead to the second half of 2003, we should begin to see improvements in
our Fine  Chemicals'  results  based upon  business  initiatives  that have been
undertaken  to  meet  the  challenges  of  the  current  operating  environment,
including cost reductions and price  increases.  Higher raw materials and energy
costs, as compared to last year,  will continue to adversely  affect profits and
the performance of selected products sold into paper, home care and agricultural
markets  could stay  depressed if the economy does not improve.  The increase in
Fine  Chemicals' raw materials costs that occurred in the second quarter of 2003
is likely to continue into fourth-quarter 2003. During the remainder of 2003, we
believe that we will face cost  pressures  with  respect to the Fine  Chemicals'
segment  that  will  gradually  subside  and give way to  favorable  comparative
performance in the second half of the year versus the first half.

The normal seasonal performance of our agricultural  chemicals products occur in
the  second  half of 2003,  which  should  provide  an  improvement  in our Fine
Chemicals' results over the first half of the year. However, we expect that many
of the profit  pressures we have experienced in Fine Chemicals in the first half
will continue to some extent into the second half of 2003.

Throughout the Fine Chemicals  sector there are significant  efforts to overcome
these  economic  issues and position the segment for a profit rebound as markets
improve.  Our bromine product area,  highlighted by our Jordan  investment,  has
delivered improved  performance in the second quarter of 2003. There is optimism
that it could  continue  to  provide  profitable  growth  for us going  forward.
Biocides for  industrial  and  recreational  water  treatment are also providing
profits for the segment.  Finally, we are generating over 70 inquiries per month
for new  business in fine  chemistry  services and  intermediates,  a 50 percent
increase from the early months of 2003.

Polymer Chemicals
Volume  improvement  in  Polymer  Chemicals  for the  second  half  of 2003  and
thereafter, particularly in flame retardants, is dependent upon general economic
conditions. Printed wiring board shipments, television production,  construction
starts and production of polyolefin  products  (sheet,  film and other plastics)
are critical to sales in this segment.

Flame  retardants  production  is mixed.  While large  volume  products  such as
tetrabrom  and decabrom are running  behind last year,  many of our  proprietary
mineral- and  phosphorus-based  products are running at  increased  rates.  With
higher raw material and energy costs impacting flame  retardants  profitability,
one of the Company's major efforts is to increase  prices.  The Company began to
see some success  toward the end of last year,  and has continued this push into
the first half of 2003.  Asia Pacific  serves as an important  growth driver for
this  business,  and the  lingering  effects of the Iraqi war and  Sudden  Acute
Respiratory  Syndrome (SARS ) slowed demand in this region.  Early third-quarter
2003 sales have been similar to the pattern of recent months,  with some pockets
of strength and renewed orders, balanced by areas of weakness, all indicative of
the uncertain pace of economic improvement.

27

In catalysts and additives,  both new product  development and continuing strong
performance from the recently  acquired  antioxidant  products line have brought
improved results.  Curatives,  now finding favor in various construction coating
applications, have shown improvement.

On July 24, 2003, we closed on the  acquisition of Rhodia's  polyurethane  flame
retardants  business.  The funding was  provided by our  existing  $375  million
Credit Agreement.  This acquisition should increase our sales on an annual basis
by approximately  $65 million.  This acquisition is projected to be accretive to
earnings and cash flow, beginning in the fourth quarter of 2003.

Overview
The  second  half  of 2003  is  predicted  to  offer  continuous  macro-economic
uncertainty.  The good news is that inventories  appear to be reasonable  across
much of our  customer  base  because of the  intense  focus on  keeping  working
capital costs down. This points the way to a quick turnaround  should conditions
improve.

Raw  material and energy  costs are  projected  to continue to produce  negative
comparisons into the second half of 2003. The Company  continues to address this
issue with cost reductions and price increases wherever possible.

Foreign exchange rate changes created favorable  revenue and margin  comparisons
during the second  quarter,  and these  favorable  comparisons  are  expected to
continue into the third  quarter.  The Company  generates over 30% of revenue in
Euro or  Sterling.  The  Company  realizes  only  modest  effects  of changes in
valuations of the U.S.  dollar against the Japanese yen for the most part, but a
weak dollar,  as seen recently,  does provide some positive  effects on revenues
and earnings.

Over the past five quarters we have closed out the U.S. Internal Revenue Service
reviews  from 1994  through  1999,  and we have  announced  over $17  million of
favorable tax adjustments including interest. Based on our current tax planning,
we think we should be able to maintain an effective tax rate of about 30 percent
in coming years.

The Company  continues to generate good cash flow.  In addition,  we believe the
time is right to  consider  either a bond  issue or other  lines of  finance  to
enhance the current  credit  facilities.  Proceeds  could be used to  repurchase
shares  to  generate  additional  shareholder  value,  support  acquisitions  to
profitably grow the business, or replace some of our floating rate debt.

Additional  information  regarding  the  Company,  its  products,   markets  and
financial   performance  is  provided  at  the  Company's   Internet  web  site,
www.albemarle.com.

28

ITEM 3. Quantitative and Qualitative Disclosures About Market Risk
        ----------------------------------------------------------
There have been no  significant  changes in our interest  rate risk,  marketable
security price risk or raw material price risk from the information  provided in
our Form 10-K for the year ended December 31, 2002, except as noted below.

The operations of the Company are exposed to market risk from changes in natural
gas  prices.   The  Company   purchases  natural  gas  to  meet  its  production
requirements. In the second quarter of 2003, the Company began hedging a portion
of its 12 month rolling forecast for North American natural gas requirements, by
entering into natural gas futures  contracts,  to help mitigate  uncertainty and
volatility.

Hedging  decisions are subject to the  management,  direction and control of the
Company's Natural Gas Risk Management Committee ("NGRMC"),  and are supported by
a third-party consultant.  The NGRMC is composed of the chief executive officer,
chief financial officer,  treasurer, vice president of supply chain, director of
external reporting and director of purchasing and logistics. The chief executive
officer  also  exercises an  independent  right to review and change the hedging
policy.  The scope of the derivative  activities are to be  communicated  to the
Board of Directors. Extensive controls are in place to govern all aspects of the
hedging process.

Hedge  transactions  are  executed  with a major  financial  institution  by the
Company's purchasing personnel.  Such derivatives are held to secure natural gas
at fixed prices and not for trading.

The natural  gas  contracts  qualify as cash flow hedges  under SFAS 133 and are
marked to market.  The unrealized  gains and/or losses are deferred and reported
in Other Comprehensive Income to the extent that the unrealized gains and losses
are offset by the forecasted transaction.  Any unrealized gains and/or losses on
the derivative instrument that are not offset by the forecasted  transaction are
recorded in earnings.  At June 30, 2003, the Company recorded  unrealized losses
of approximately $47 ($30 net of tax) in Other Comprehensive Income.

ITEM 4. Controls and Procedures
        -----------------------
As of the end of the period covered by this report,  an evaluation was performed
under the  supervision  and with the  participation  of Albemarle's  management,
including our principal  executive officer and our principal  financial officer,
of the effectiveness of the design and operation of our disclosure  controls and
procedures  (as defined in Rules  13a-14(c) and 15d-14(c)  under the  Securities
Exchange  Act of 1934).  Based upon that  evaluation,  our  principal  executive
officer  and our  principal  financial  officer  concluded  that the  design and
operation of these  disclosure  controls and  procedures  were effective for the
second  quarter  of 2003.  No  significant  changes  were  made in our  internal
controls or in other  factors that could  significantly  affect  these  controls
subsequent to the date of their evaluation.


29


Part II - OTHER INFORMATION
---------------------------

ITEM 1. Legal Proceedings
        -----------------
The Company is involved from time to time in legal proceedings of types regarded
as common in the Company's businesses,  particularly  administrative or judicial
proceedings seeking remediation under environmental laws, such as Superfund, and
products liability litigation.

While it is not possible to predict or determine the outcome of the  proceedings
presently pending, in the Company's opinion they should not result ultimately in
any liability that is likely to have a material  adverse effect upon the results
of  operations,   financial  condition  or  cash  flows  of  the  Company  on  a
consolidated basis.

ITEM 6. Exhibits and Reports on Form 8-K
        --------------------------------

    (a)      Exhibits

           3(ii)   Bylaws of the registrant amended June 25, 2003

             31    Section 302 Certifications of Chief Executive Officer and
                      Chief Financial Officer

             32    Section 906 Certifications of Chief Executive Officer and
                      Chief Financial Officer




    (b) Reports on Form 8-K


       (1) The Company filed a Form 8-K on April 23, 2003, which
           included the Company's earnings press release for the
           quarter ended March 31, 2003.

       (2) The Company filed a Form 8-K on June 19, 2003, which
           included the Company's press release regarding the
           Company's intent to acquire phosphorus flame
           retardants in agreement with Rhodia SA.

       (3) The Company filed a Form 8-K on July 23, 2003, which
           included the Company's earnings press release for the
           quarter ended June 30, 2003.

       (4) The Company filed a Form 8-K on July 24, 2003, which
           included the Company's press release regarding the
           Company's completion of the acquisition of Rhodia's
           polyurethane flame retardant business.




30




                                   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.

                                                          ALBEMARLE CORPORATION
                                                          ---------------------
                                                          (Registrant)




Date:  August 1, 2003                                 By: /s/ PAUL F. ROCHELEAU
                                                         ----------------------
                                                            Paul F. Rocheleau
                                                       Senior Vice President and
                                                         Chief Financial Officer


31

                                                                             


                                  EXHIBIT INDEX
                                  -------------

                                                                                Page
                                                                               Numbers
                                                                               -------

3(ii)      Bylaws of the registrant amended June 25, 2003                       32-43

  31       Section 302 Certifications of Chief Executive Officer and
             Chief Financial Officer                                            44-45

  32       Section 906 Certifications of Chief Executive Officer and
             Chief Financial Officer                                            46-47