0001021408-01-508565.txt : 20011029
0001021408-01-508565.hdr.sgml : 20011029
ACCESSION NUMBER: 0001021408-01-508565
CONFORMED SUBMISSION TYPE: 8-K
PUBLIC DOCUMENT COUNT: 2
CONFORMED PERIOD OF REPORT: 20001130
ITEM INFORMATION: Other events
ITEM INFORMATION: Financial statements and exhibits
FILED AS OF DATE: 20011023
FILER:
COMPANY DATA:
COMPANY CONFORMED NAME: PROGRESS ENERGY INC
CENTRAL INDEX KEY: 0001094093
STANDARD INDUSTRIAL CLASSIFICATION: ELECTRIC SERVICES [4911]
IRS NUMBER: 562155481
STATE OF INCORPORATION: NC
FISCAL YEAR END: 1231
FILING VALUES:
FORM TYPE: 8-K
SEC ACT: 1934 Act
SEC FILE NUMBER: 001-15929
FILM NUMBER: 1764246
BUSINESS ADDRESS:
STREET 1: 410 S WILMINGTON ST
CITY: RALEIGH
STATE: NC
ZIP: 27601
BUSINESS PHONE: 9195466463
MAIL ADDRESS:
STREET 1: 411 FAYETTEVILLE STREET
CITY: RALEIGH
STATE: NC
ZIP: 27601
FORMER COMPANY:
FORMER CONFORMED NAME: CP&L ENERGY INC
DATE OF NAME CHANGE: 20000314
FORMER COMPANY:
FORMER CONFORMED NAME: CP&L HOLDINGS INC
DATE OF NAME CHANGE: 19990830
8-K
1
d8k.txt
FORM 8-K
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
____________________
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of report (date of earliest event reported):
November 30, 2000
Commission Exact name of registrants as specified I.R.S. Employer
File Number in their charters, state of Identification Number
incorporation, address of principal
executive offices, and telephone
number
1-15929 Progress Energy, Inc. 56-2155481
410 South Wilmington Street
Raleigh, North Carolina 27601-1748
Telephone: (919) 546-6111
State of Incorporation: North Carolina
The address of the registrant has not changed since the last report.
================================================================================
ITEM 5. OTHER EVENTS
The purpose of this Form 8-K is to update certain pro forma financial
information previously filed by Progress Energy in connection with its
acquisition of Florida Progress Corporation on November 30, 2000.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS
(a) Financial Statements of Business Acquired:
None.
(b) Pro Forma Financial Information:
The Unaudited Pro Forma Combined Condensed Statement of Income for the Year
Ended December 31, 2000 (the "Pro Forma Financial Statement"), which is an
Exhibit to this filing, illustrates the pro forma effects of the share exchange
between Progress Energy and Florida Progress accounted for as a purchase
business combination. The Pro Forma Financial Statement has been prepared as if
the share exchange had been consummated on January 1, 2000, using purchase
accounting adjustments that were calculated based on the preliminary purchase
price allocation as of the date of this filing.
A final determination of required purchase accounting adjustments has not been
completed; accordingly, the purchase accounting adjustments made in the
development of the Pro Forma Financial Statement are preliminary and have been
made solely for purposes of developing the pro forma information. The unaudited
pro forma financial information is presented for illustration purposes only in
accordance with the assumptions set forth therein; is not necessarily indicative
of the operating results that would have occurred based on the share exchange
having occurred as of the dates indicated; nor is it necessarily indicative of
future operating results of the combined enterprise.
The Pro Forma Financial Statement does not contain adjustments to reflect cost
savings or other benefits anticipated as a result of the share exchange and
integration of the companies, nor does it contain anticipated integration costs.
For additional information, the Pro Forma Financial Statement may be read in
conjunction with the following:
1. Progress Energy, Inc.'s financial statements for the year ended December
31, 2000 included in its Form 10-K, filed with the Securities and Exchange
Commission (SEC) on March 28, 2001; Form 10-Q, filed with the SEC on May
15, 2001; and Form 10-Q, filed with the SEC on August 10, 2001.
2. Florida Progress Corporation's financial statements for the year ended
December 31, 2000 included in its Form 10-K, filed with the SEC on March
28, 2001; Form 10-Q, filed with the SEC on May 15, 2001; and Form 10-Q,
filed with the SEC on August 10, 2001.
(c) Exhibits:
99 Progress Energy, Inc. Unaudited Pro Forma Combined Condensed
Statement of Income and related footnotes, for the year ended
December 31, 2000. (filed herewith)
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 hereunto duly authorized.
PROGRESS ENERGY, INC.
Registrant
By: /s/ Peter M. Scott III
------------------------------
Peter M. Scott III
Executive Vice President and
Chief Financial Officer
By: /s/ Robert H. Bazemore, Jr.
------------------------------
Robert H. Bazemore, Jr.
Vice President and Controller
(Chief Accounting Officer)
Date: October 23, 2001
INDEX TO EXHIBITS
Exhibit Number Description of Exhibit
-------------- ----------------------
99 Progress Energy, Inc. Unaudited Pro Forma Combined Condensed
Statement of Income and related footnotes, for the year ended
December 31, 2000.
EX-99
3
dex99.txt
UNAUDITED PRO FORMA STATEMENTS
EXHIBIT 99
Unaudited Pro Forma Combined Condensed Statement of Income
For the Year Ended December 31, 2000
Florida Progress
(in millions except per share data) Progress Energy For the Eleven
For the Year Ended Month Period Ended Pro Forma Pro Forma
December 31, 2000 November 30, 2000 Adjustments Combined (1)
(1) (1)
---------------------------------------------------------------------------------------
Operating Revenues
Electric $ 3,565.3 $2,634.0 $ - $6,199.3
Natural gas 324.5 - - 324.5
Diversified businesses 229.1 1,450.1 (155.3) (3b) 1,523.9
--------- -------- ------- --------
Total operating revenues 4,118.9 4,084.1 (155.3) 8,047.7
--------- -------- ------- --------
Operating Expenses
Fuel used in electric generation 686.8 626.7 - 1,313.5
Purchased power 364.9 458.8 - 823.7
Gas purchased for resale 250.9 - - 250.9
Other operations and maintenance 823.5 538.9 (50.9) (3e) 1,311.5
Depreciation and amortization 740.5 373.8 81.9 (3a) 1,196.2
Taxes other than on income 165.4 197.5 362.9
Harris Plant deferred costs, net 14.3 - 14.3
Diversified businesses 353.0 1,676.5 (167.5) (3a, 3b, 3e) 1,862.0
--------- -------- ------- --------
Total operating expenses 3,399.3 3,872.2 (136.5) 7,135.0
--------- -------- ------- --------
Operating Income 719.6 211.9 (18.8) 912.7
Other Income (Expense) 223.9 (11.3) 17.9 (3e) 230.5
--------- -------- ------- --------
Income Before Interest Charges
and Income Taxes 943.5 200.6 (0.9) 1,143.2
Interest Charges, net 262.3 190.4 235.8 (3b, 3c) 688.5
--------- -------- ------- --------
Income Before Income Taxes 681.2 10.2 (236.7) 454.7
Income Taxes (Benefit) 202.8 (106.9) (88.3) (3d) 7.6
--------- -------- ------- --------
Net Income $ 478.4 $ 117.1 $(148.4) $ 447.1
========= ======== ======= ========
Average Common Shares
Outstanding
Basic (4) 157.2 98.6 199.7
Diluted (4) 157.6 98.8 200.2
Basic Earnings Per Common Share $ 3.04 $ 1.19 $ 2.24
========= ======== ========
Diluted Earnings Per Common Share $ 3.03 $ 1.19 $ 2.23
========= ======== ========
See accompanying Notes to Unaudited Pro Forma Combined Condensed Statement of
Income.
Notes to Unaudited Pro Forma Combined Condensed Statement of Income
(1) The Acquisition
---------------
The share exchange is accounted for by Progress Energy under the
purchase method of accounting for business combinations. Accordingly,
the results of operations for Florida Progress and other
acquisition-related costs, e.g., goodwill amortization and interest
expense, have been included in Progress Energy's consolidated financial
statements since the acquisition on November 30, 2000.
Due to the significance of the public debt and preferred securities of
Florida Progress, the acquisition cost was not pushed down to Florida
Progress' separate financial statements. Even though a new basis of
accounting and reporting for Florida Progress was not established,
significant merger-related costs were incurred and are included in
Florida Progress' statement of income for the eleven month period ended
November 30, 2000. Pro forma adjustments have been made to reflect
these direct merger-related costs as part of the purchase price
allocation. Additionally, Florida Progress' statement of income for the
eleven month period ended November 30, 2000 includes certain impairment
charges of $130.7 million, employee involuntary termination charges of
$41.8 million, deferred electric revenues of $59.9 million, and other
costs, that management does not believe are of a recurring nature;
however, these items are included in Progress Energy's unaudited pro
forma combined condensed statement of income for the year ended
December 31, 2000 in accordance with SEC guidance on the preparation of
pro forma information.
The unaudited pro forma combined condensed statement of income does not
give effect to restructuring costs, except the merger-related charges
discussed above, nor any potential cost savings or other benefits that
could result from the share exchange. Progress Energy is in the process
of implementing its plan to integrate the operations of Florida
Progress. There were no material intercompany transactions among
Progress Energy, Carolina Power & Light and Florida Progress during the
periods presented that require elimination.
(2) Purchase Price Allocation
-------------------------
The fair value of the consideration exchanged to acquire Florida
Progress common stock will be allocated to the assets and liabilities
of Florida Progress based on their estimated fair values. A preliminary
allocation of the purchase price has been presented in the unaudited
pro forma combined condensed statement of income in which the fair
value of the identifiable net tangible assets of Florida Progress is
assumed to equal the net book value of such assets, except for net
assets held for sale as discussed in Note 2c. The excess of
consideration over the fair value of the identifiable net tangible
assets has been preliminarily allocated to goodwill as follows (in
millions):
Consideration exchanged for Florida Progress common stock (a) $ 5,374.7
Plus: Estimated transaction costs (b) 19.4
---------
Total estimated purchase price 5,394.1
Less: Net assets held for sale (c) 19.7
Less: Estimated fair value of Florida Progress' identifiable net assets on November 30, 2000 (d) 1,802.4
---------
Total estimated goodwill $ 3,572.0
---------
(a) The consideration and preliminary purchase price allocation used
for pro forma purposes are based on an aggregate purchase price of
approximately $5.4 billion. Progress Energy paid cash
consideration of approximately $3.5 billion and issued 46.5
million common shares valued at approximately $1.9 billion. In
addition, Progress Energy issued 98.6 million contingent value
obligations valued at approximately $49.3 million.
(b) Transaction costs primarily include investment banking fees and
other professional fees.
(c) Progress Energy has announced the disposition of Florida Progress'
Inland Marine Transportation segment. Accordingly, the segment's
assets and liabilities have been classified as Net Assets Held for
Sale, with adjustments to reflect estimated disposition proceeds
and earnings during the period until disposition.
(d) The fair values of Florida Progress' rate-regulated net assets
acquired are considered to be equivalent to book value since book
value represents the amount that will be recoverable through
regulated rates. A valuation of non-regulated net assets has not
been completed, and, therefore, for pro forma purposes, the fair
value of the identifiable net tangible assets of Florida Progress
is assumed to equal the net book value of such assets, except for
net assets held for sale as discussed in Note 2c.
(3) Pro forma Adjustments
---------------------
The following pro forma adjustments have been made to the unaudited pro
forma combined condensed statement of income for the year ended
December 31, 2000 to reflect the acquisition as if it occurred on
January 1, 2000:
(a) A pro forma adjustment has been made to reflect estimated
amortization expense on the goodwill resulting from the
acquisition for an additional eleven months and to eliminate
Florida Progress' historical amortization of goodwill. Goodwill is
amortized over an estimated useful life of 40 years. If a portion
of goodwill were assigned to net assets that have lives less than
40 years, or if the estimated life of goodwill were less than 40
years, pro forma goodwill amortization expense would increase,
with a corresponding decrease in pro forma earnings per share.
(b) A pro forma adjustment has been made to remove the effects of
Florida Progress' Inland Marine Transportation segment (see Note
2c).
(c) A pro forma adjustment has been made to reflect increased interest
expense resulting from the issuance of approximately $3.5 billion
of long-term debt to fund part of the purchase price (see Note
2a). The pro forma adjustment is based on an effective interest
rate of 7.5%. Progress Energy issued $3.2 billion of long-term
debt in February 2001 with a effective interest rate of 7.5%. The
remaining cash portion of the share exchange is being financed
through short-term facilities with plans to issue long-term debt
in the near future. Interest expense has been decreased by
approximately $4 million to reflect the assumed reduction in
long-term debt using the estimated net proceeds of the disposition
of Florida Progress' Inland Marine Transportation segment and an
interest rate of 7.5% (see Note 2c). If the average interest rate
changed by 1/8%, the pro forma net income would change by
approximately $2.6 million on an annual basis.
(d) A pro forma income tax adjustment totaling $93.8 million has been
made to reflect the tax benefit of pro forma interest expense,
using Progress Energy's statutory tax rate of approximately 40%.
Goodwill created by the share exchange is nondeductible for tax
purposes. Pro forma adjustments have been made to remove the
income taxes of Florida Progress' Inland Marine Transportation
segment (see Note 2c). Additionally, pro forma income tax
adjustments have been made to reverse the income tax effect of
merger-related charges that resulted directly from the
transaction, which include certain change of control payments that
are nondeductible for tax purposes.
(e) Pro forma consolidation adjustments have been made to reverse
merger-related charges that resulted directly from the transaction
(see Note 1) and that are reflected in Florida Progress' operating
results for the eleven month period ended November 30, 2000.
(4) Stock Consideration
Progress Energy issued 46.5 million common shares as part of the
Florida Progress purchase price. The unaudited pro forma net earnings
per share reflect the weighted-average number of shares of Progress
Energy common stock that would have been outstanding if the share
exchange had occurred on January 1, 2000.