EX-99.1 RELEASE 3 vvc-qtr1_release.txt PRESS RELEASE AND FINANCIALS Exhibit 99.1 News Release Vectren Corporation P.O. Box 209 Evansville, IN 47702-0209 April 23, 2003 FOR IMMEDIATE RELEASE Vectren Corporation Reports 1st Quarter 2003 Increase Evansville, Indiana - Vectren Corporation (NYSE:VVC) today reported 2003 first quarter earnings of $55.7 million, or $.82 per share compared to net income of $45.6 million, or $.68 per share, for the same period last year. Said Niel C. Ellerbrook, Chairman and CEO, "Fiscal year 2003 is off to a very good start with higher gas and electric margins due to colder than normal weather and a strong wholesale power market. Our energy marketing and services group capitalized on increased demand for gas and volatile gas prices with a very good first quarter. While we have not seen the economic recovery we had hoped for, we believe our business plans remain on target and fiscal year 2003 will produce another solid year of performance." Specific Highlights for the Quarter Include Utility earnings for the first quarter 2003 were $47.3 million as compared to $42.0 million in the same period last year. Gas margins were $144.4 million, an increase of $16.5 million over first quarter 2002. Electric margins were $58.2, an increase of $8.9 million over first quarter 2002. The increase in margins was due primarily to higher demand resulting from the colder weather and improved margins in the wholesale power market. First quarter 2003 weather was 8% colder than normal as compared to first quarter 2002 that was 12% warmer than normal. Other operating expenses at Vectren Utility Holdings increased $5.3 million due primarily to scheduled maintenance costs and increased uncollectible accounts expense related to higher customer bills resulting from higher gas costs and colder weather. Taxes other than income taxes increased $3.7 million principally due to higher gross receipt taxes as a result of increased sales volumes. These taxes are recovered through utility customer margins. Nonregulated earnings for the first quarter 2003 were $8.5 million as compared to $4.4 million in the same period last year. Earnings from the Energy Marketing and Services group increased $3.8 million over the first quarter 2002 principally due to synergies captured as the result of the recent integration of the company's two gas marketing firms and continued sales growth. Affirms 2003 Guidance Vectren confirmed 2003 earnings guidance in the range of $1.75 to $1.85 per share, including the potential impact of any permanent financing to be completed during 2003. Please SEE ATTACHED unaudited schedules for additional financial information Live Webcast Vectren Corporation will provide more detail on 2003 first quarter results on a conference call for analysts scheduled at 2:30 p.m. EDT (1:30 CDT), Thursday April 24, 2003. You are invited to listen to the live Webcast and view the supporting slides by accessing the Investor Relations link on Vectren's Web site at www.Vectren.com. Interested parties may also view the slide presentation and listen to the Webcast replay via Vectren's Web site beginning two hours after the completion of the Webcast. A tape-recorded replay of the call will also be available through Thursday, May 1, 2003. To access the replay, dial 706-645-9201 and enter the conference identification number 7498394. About Vectren Vectren Corporation is an energy and applied technology holding company headquartered in Evansville, Indiana. Vectren's energy delivery subsidiaries provide gas and/or electricity to over one million customers in adjoining service territories that cover nearly two-thirds of Indiana and west central Ohio. Vectren's non-regulated subsidiaries and affiliates currently offer energy-related products and services to customers throughout the surrounding region. These services include energy marketing; coal mining; utility infrastructure services; and broadband communication services. To learn more about Vectren, visit www.vectren.com. Safe Harbor for Forward Looking Statements This document contains forward-looking statements, which are based on management's beliefs and assumptions that derive from information currently known by management. Vectren wishes to caution readers that actual results could differ materially from those contained in this document. Additional detailed information concerning a number of factors that could cause actual results to differ materially from the information that is provided to you is readily available in our report Form 10-K filed with the Securities and Exchange Commission on March 17, 2003. Investor Contact Steven M. Schein, (812) 491-4209, sschein@vectren.com ------------------- Media Contact Jeffrey W. Whiteside, (812) 491-4205, jwhiteside@vectren.com ---------------------- ### VECTREN CORPORATION AND SUBSIDIARY COMPANIES CONSOLIDATED STATEMENTS OF INCOME (Thousands, except for share amounts) (Unaudited)
Three Months Twelve Months Ended March 31 Ended March 31 ---------------------- ------------------------- 2003 2002 2003 2002 ---------------------- ------------------------- As Restated As Restated ----------- ----------- OPERATING REVENUE: Gas utility $ 509,531 $ 358,053 $ 1,060,505 $ 851,715 Electric utility 119,376 126,800 600,692 419,330 Energy services and other 33,601 145,519 175,273 563,157 --------- --------- ----------- ---------- Total operating revenues 662,508 630,372 1,836,470 1,834,202 --------- --------- ----------- ---------- OPERATING EXPENSES: Cost of gas sold 365,116 230,153 706,179 534,911 Fuel for electric generation 20,769 17,791 84,597 74,207 Purchased electric energy 40,398 59,749 276,916 135,868 Cost of energy services and other 25,535 134,783 140,169 522,500 Other operating 62,572 57,577 227,943 239,115 Merger and integration costs - - - 1,846 Restructuring costs - - - 19,048 Depreciation and amortization 31,402 29,026 122,007 121,550 Taxes other than income taxes 22,035 18,332 55,605 52,503 --------- --------- ----------- ---------- Total operating expenses 567,827 547,411 1,613,416 1,701,548 --------- --------- ----------- ---------- OPERATING INCOME 94,681 82,961 223,054 132,654 OTHER INCOME (EXPENSE): Equity in earnings of unconsolidated investments 8,806 3,064 14,824 9,761 Other - net (1,148) 2,190 8,184 16,108 --------- --------- ----------- ---------- Total other income 7,658 5,254 23,008 25,869 --------- --------- ----------- ---------- INTEREST EXPENSE 18,876 19,844 77,513 80,156 --------- --------- ----------- ---------- INCOME BEFORE INCOME TAXES 83,463 68,371 168,549 78,367 INCOME TAXES 27,727 22,998 43,612 16,272 MINORITY INTEREST IN SUBSIDIARY 27 (209) 750 433 PREFERRED DIVIDEND REQUIREMENT OF SUBSIDIARY 9 7 34 528 --------- --------- ----------- ---------- NET INCOME BEFORE EXTRAORDINARY LOSS $ 55,700 $ 45,575 $ 124,153 $ 61,134 EXTRAORDINARY LOSS, NET OF TAX - - - (7,706) --------- --------- ----------- ---------- NET INCOME $ 55,700 $ 45,575 $ 124,153 $ 53,428 ========= ========= =========== ========== AVERAGE COMMON SHARES OUTSTANDING 67,695 67,533 67,621 67,521 DILUTED COMMON SHARES OUTSTANDING 67,842 67,806 67,888 67,658 EARNINGS PER SHARE OF COMMON STOCK BASIC: NET INCOME BEFORE EXTRAORDINARY LOSS $ 0.82 $ 0.68 $ 1.84 $ 0.91 EXTRAORDINARY LOSS, NET OF TAX - - - (0.11) --------- --------- ----------- ---------- EARNINGS PER SHARE OF COMMON STOCK $ 0.82 $ 0.68 $ 1.84 $ 0.79 DILUTED: NET INCOME BEFORE EXTRAORDINARY LOSS $ 0.82 $ 0.67 $ 1.83 $ 0.90 EXTRAORDINARY LOSS, NET OF TAX - - - (0.11) --------- --------- ----------- ---------- EARNINGS PER SHARE OF COMMON STOCK $ 0.82 $ 0.67 $ 1.83 $ 0.79 ========= ========= =========== ==========
VECTREN UTILITY HOLDINGS AND SUBSIDIARY COMPANIES CONSOLIDATED STATEMENTS OF INCOME (Thousands, except for share amounts) (Unaudited)
Three Months Twelve Months Ended March 31 Ended March 31 ---------------------- -------------------------- 2003 2002 2003 2002 ---------------------- -------------------------- As Restated As Restated ----------- ----------- OPERATING REVENUE: Gas utility $ 509,531 $ 358,053 $ 1,060,505 $ 851,715 Electric utility 119,376 126,800 600,692 419,330 Other 198 50 436 182 --------- --------- ----------- ----------- Total operating revenues 629,105 484,903 1,661,633 1,271,227 --------- --------- ----------- ----------- OPERATING EXPENSES: Cost of gas sold 365,116 230,468 706,482 535,227 Fuel for electric generation 20,769 17,791 84,597 74,207 Purchased electric energy 40,398 59,749 276,916 135,868 Other operating 56,603 51,256 203,891 210,287 Merger and integration costs - - - 1,814 Restructuring costs - - - 15,010 Depreciation and amortization 28,762 26,771 112,677 113,472 Taxes other than income taxes 21,718 18,060 54,395 50,486 --------- --------- ----------- ----------- Total operating expenses 533,366 404,095 1,438,958 1,136,371 --------- ----------- ----------- ----------- OPERATING INCOME 95,739 80,808 222,675 134,856 OTHER INCOME (EXPENSE): Equity in earnings (losses) of unconsolidated affiliates (504) (112) (2,251) (1,334) Other - net (1,507) 2,085 3,551 8,830 --------- --------- ----------- ----------- Total other income (expense) (2,011) 1,973 1,300 7,496 --------- --------- ----------- ----------- INTEREST EXPENSE 16,516 17,548 68,087 68,765 --------- --------- ----------- ----------- INCOME BEFORE INCOME TAXES 77,212 65,233 155,888 73,587 INCOME TAXES 29,895 23,189 53,478 23,781 PREFERRED DIVIDEND REQUIREMENT OF SUBSIDIARY 9 7 34 527 --------- --------- ----------- ----------- NET INCOME $ 47,308 $ 42,037 $ 102,376 $ 49,279 ========= ========= =========== ===========
VECTREN CORPORATION 3 Months 12 Months HIGHLIGHTS Ended March 31 Ended March 31 ------------------------------------------- (millions, except per share amounts) (Unaudited) 2003 2002 2003 2002 ---------------------------------------------------------------------------------------- As Restated As Restated ----------- ----------- Reported Earnings: Utility Group $ 47.3 $ 42.0 $ 102.4 $ 49.3 Non-regulated Group 8.5 4.4 23.0 9.0 Corporate and Other (0.1) (0.8) (1.3) (4.9) ------- ------ ------- ------ Vectren Consolidated $ 55.7 $ 45.6 $ 124.1 $ 53.4 Merger, Integration and Restructuring Costs: Utility Group $ - $ - $ - $ 14.7 Non-regulated Group - - - 2.2 Corporate and Other - - - 0.6 ------- ------ ------- ------ Total - - - 17.5 Other Non-Recurring Items: Non-regulated Group- Extraordinary Loss in 2001 $ - $ - $ - $ (7.7) ------ ------ ------- ------ Income From Operations: Utility Group $ 47.3 $ 42.0 $ 102.4 $ 64.0 Non-regulated Group Energy Marketing and Services 8.4 4.6 18.6 11.3 Coal Mining 2.5 2.0 12.7 14.4 Utility Infrastructure Services (1.0) (0.5) (1.6) (0.4) Broadband 0.1 0.1 0.4 - Other Businesses (1.5) (1.8) (7.1) (6.4) ------ ------ ------- ------ Total Non-regulated Group 8.5 4.4 23.0 18.9 Corporate and Other (0.1) (0.8) (1.3) (4.3) ------ ------ ------- ------ Vectren Consolidated $ 55.7 $ 45.6 $ 124.1 $ 78.6 ====== ====== ======= ======
Vectren Selected Highlights 12 months 12 months Ended Ended March 31 March 31 2003 2002 --------- --------- Dividends Paid (per common share, 12 months) $ 1.08 $ 1.04 Annualized Dividend $ 1.10 $ 1.06 Dividend Yield (at close) 5.1% 4.1% Dividend Payout Ratio 58.7% 131.6% Dividend to Book Value 8.1% 8.3% Return on Average Shareholder Equity 13.9% 6.1% Book Value Per Share $13.54 $12.77 Market to Book Value (at close) 159% 201% Common Stock Prices (VVC - NYSE) High $26.10 $25.95 Low $17.95 $19.76 Close $21.51 $25.69 Price/Earnings Ratio (trailing) 11.7 32.5 Percent Internally Generated Funds - Utility Group 79% 65% Ratio of Earnings to Fixed Charges - SEC Method Consolidated 2.9 1.7 Utility Group 3.3 2.1
VECTREN CORPORATION SELECTED GAS DISTRIBUTION 3 Months 12 Months OPERATING STATISTICS Ended March 31 Ended March 31 ------------------------ --------------------------- 2003 2002 2003 2002 --------- ----------- ----------- ----------- (Unaudited) As Restated As Restated ------------------------------------ ----------- ----------- GAS OPERATING REVENUES (Thousands): Residential $ 345,617 $ 247,313 $ 705,410 $ 570,773 Commercial 127,218 82,098 256,722 195,161 Contract 34,079 27,558 89,490 81,782 Miscellaneous Revenue 2,617 1,084 8,883 3,999 --------- --------- ----------- --------- $ 509,531 $ 358,053 $ 1,060,505 $ 851,715 ========= ========= =========== ========= GAS MARGIN (Thousands): Operating Revenues $ 509,531 $ 358,053 $ 1,060,505 $ 851,715 Cost of Gas 365,116 230,153 706,179 534,911 --------- --------- ----------- --------- Margin $ 144,415 $ 127,900 $ 354,326 $ 316,804 ========= ========= =========== ========= GAS SOLD & TRANSPORTED (MDth): Residential 44,556 36,359 88,923 72,381 Commercial 17,218 13,335 34,894 27,469 Contract 30,324 28,901 97,380 95,472 --------- --------- ----------- --------- 92,098 78,595 221,197 195,322 ========= ========= =========== ========= AVERAGE GAS CUSTOMERS: Residential 885,084 874,605 871,183 861,180 Commercial 80,675 80,671 79,541 79,803 Contract 4,134 4,275 4,143 4,006 --------- --------- ----------- -------- 969,893 959,551 954,867 944,989 ========= ========= =========== ========= WEATHER AS A PERCENT OF NORMAL: Heating Degree Days 108% 88% 107% 85%
VECTREN CORPORATION SELECTED ELECTRIC 3 Months 12 Months OPERATING STATISTICS Ended March 31 Ended March 31 ------------------------- ------------------------- 2003 2002 2003 2002 ---------- ----------- ----------- ----------- (Unaudited) As Restated As Restated ---------------------------------------- ----------- ----------- ELECTRIC OPERATING REVENUES (Thousands): Residential $ 25,996 $ 23,160 $ 110,959 $ 97,542 Commercial 18,765 17,638 81,747 75,702 Industrial 21,051 20,149 91,272 83,971 Miscellaneous Revenue 1,504 933 5,611 5,799 ---------- ---------- ---------- ----------- Total Retail 67,316 61,880 289,589 263,014 Wholesale 52,060 64,920 311,103 156,316 ---------- ---------- ---------- ----------- $ 119,376 $ 126,800 $ 600,692 $ 419,330 ========== ========== ========== =========== ELECTRIC MARGIN (Thousands): Operating Revenues $ 119,376 $ 126,800 $ 600,692 $ 419,330 Cost of Fuel & Purchased Power 61,167 77,540 361,513 210,075 ---------- ---------- ---------- ----------- Margin $ 58,209 $ 49,260 $ 239,179 $ 209,255 ========== ========== ========== =========== ELECTRICITY SOLD (MWh): Residential 394,815 353,239 1,608,791 1,413,094 Commercial 333,846 321,837 1,479,789 1,403,327 Industrial 553,911 580,691 2,489,555 2,431,157 Miscellaneous Sales 5,114 4,807 18,424 18,686 ---------- ---------- ---------- ----------- Total Retail 1,287,686 1,260,574 5,596,559 5,266,264 Firm Wholesale 133,812 134,785 616,712 544,577 Non-Firm Wholesale 1,448,350 2,467,819 9,692,145 5,037,422 ---------- ---------- ---------- ----------- 2,869,848 3,863,178 15,905,416 10,848,263 ========== ========== ========== =========== AVERAGE ELECTRIC CUSTOMERS: Residential 117,057 115,905 116,449 115,365 Commercial 16,934 17,348 17,030 17,360 Industrial 176 175 175 171 All Others 22 23 23 23 ---------- ---------- ----------- ----------- 134,189 133,451 133,677 132,919 ========== ========== =========== =========== WEATHER AS A PERCENT OF NORMAL: Heating Degree Days 108% 88% 107% 85% Cooling Degree Days 0% 0% 123% 97%