-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: keymaster@town.hall.org Originator-Key-Asymmetric: MFkwCgYEVQgBAQICAgADSwAwSAJBALeWW4xDV4i7+b6+UyPn5RtObb1cJ7VkACDq pKb9/DClgTKIm08lCfoilvi9Wl4SODbR1+1waHhiGmeZO8OdgLUCAwEAAQ== MIC-Info: RSA-MD5,RSA, pvCO8XRE8dK+F4uHbwCBTHYOz2RzRRmb/ECkSra7915K8pB9CsVbfJd7rnO/QJ9f dEkSrNoKuOWh4XCrHu2yAg== 0000027430-94-000002.txt : 19940520 0000027430-94-000002.hdr.sgml : 19940520 ACCESSION NUMBER: 0000027430-94-000002 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19940331 FILED AS OF DATE: 19940516 FILER: COMPANY DATA: COMPANY CONFORMED NAME: DAYTON POWER & LIGHT CO CENTRAL INDEX KEY: 0000027430 STANDARD INDUSTRIAL CLASSIFICATION: 4931 IRS NUMBER: 310258470 STATE OF INCORPORATION: OH FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-02385 FILM NUMBER: 94528732 BUSINESS ADDRESS: STREET 1: COURTHOUSE PLZ SOUTHWEST STREET 2: PO BOX 1247 CITY: DAYTON STATE: OH ZIP: 45402 BUSINESS PHONE: 5132246000 MAIL ADDRESS: STREET 1: P O BOX 8825 CITY: DAYTON STATE: OH ZIP: 45401 10-Q 1 DP&L 1ST QUARTER 1994 10-Q UNITED STATES 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 the quarterly period ended March 31, 1994 OR ( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to ------ ------ Commission File Number 1-2385 ------ THE DAYTON POWER AND LIGHT COMPANY (Exact name of registrant as specified in its charter) OHIO 31-0258470 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) Courthouse Plaza Southwest Dayton, Ohio 45402 (Address of principal executive offices) 513-224-6000 (Registrant's telephone number, including area code) 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 ----- ----- The registrant meets the conditions set forth in General Instruction H(1)(a) and (b) of Form 10-Q and is therefore filing this form with the reduced disclosure format. Indicate the number of shares of the issuer's classes of common stock, as of the latest practicable date. Common Stock, $.01 par value 41,172,173 shares - - ---------------------------- ---------------------------------- (Title of each class) (Outstanding on March 31, 1994) THE DAYTON POWER AND LIGHT COMPANY INDEX Page No. -------- Part I - Financial Information Item 1. Financial Statements Consolidated Statement of Results of Operations 1 Consolidated Statement of Cash Flows 2 Consolidated Balance Sheet 3 Notes to Consolidated Financial Statements 5 Operating Statistics 7 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 9 Part II - Other Information 11 Signatures 13 i
CONSOLIDATED STATEMENT OF RESULTS OF OPERATIONS The Dayton Power and Light Company Three Months Ended March 31 ------------------ 1994 1993 ---- ---- --thousands-- INCOME Utility service revenues-- Electric . . . . . . . . . . . . . . . . . . . . . $250,298 $232,948 Gas . . . . . . . . . . . . . . . . . . . . . . . 118,876 110,130 Steam . . . . . . . . . . . . . . . . . . . . . . 3,547 3,361 -------- -------- Total utility service revenues . . . . . . . . . 372,721 346,439 Interest and other income . . . . . . . . . . . . . 1,152 2,262 -------- -------- Total Income . . . . . . . . . . . . . . . . . 373,873 348,701 -------- -------- EXPENSES Fuel used in electric and steam production . . . . . 58,681 59,471 Gas purchased for resale . . . . . . . . . . . . . . 79,215 72,797 Operating and administrative . . . . . . . . . . . . 43,931 47,874 Maintenance of equipment and facilities . . . . . . 16,177 12,794 Depreciation and amortization . . . . . . . . . . . 27,900 27,156 General taxes . . . . . . . . . . . . . . . . . . . 28,995 27,464 Interest expense . . . . . . . . . . . . . . . . . . 23,484 25,308 Allowance for funds used during construction . . . . (205) 114 Regulatory deferrals (Note 2) . . . . . . . . . . . 2,630 (6,151) -------- -------- Total Operating Expenses . . . . . . . . . . . 280,808 266,827 -------- -------- Operating Income . . . . . . . . . . . . . . . . . . 93,065 81,874 Income Taxes . . . . . . . . . . . . . . . . . . . . 36,847 27,088 -------- -------- Net Income . . . . . . . . . . . . . . . . . . . . . 56,218 54,786 Preferred dividends . . . . . . . . . . . . . . . . 2,120 2,311 -------- -------- Earnings on Common Stock . . . . . . . . . . . . . . $ 54,098 $ 52,475 ======== ========
See Notes to Consolidated Financial Statements. These interim statements are unaudited. 1
CONSOLIDATED STATEMENT OF CASH FLOWS The Dayton Power and Light Company Three Months Ended March 31 -------------------- 1994 1993 ---- ---- --thousands-- Operating Activities - - -------------------- Cash received from utility customers . . . . . . . . . . . . . . . . . . $355,790 $315,232 Other operating cash receipts . . . . . . . . . . . . . . . . . . . . . 1,330 2,442 Cash paid for: Fuel and purchased power . . . . . . . . . . . . . . . . . . . . . . . (57,443) (54,225) Purchased gas . . . . . . . . . . . . . . . . . . . . . . . . . . . . (53,057) (42,425) Operation and maintenance labor . . . . . . . . . . . . . . . . . . . (25,111) (20,677) Non-labor operating expenditures . . . . . . . . . . . . . . . . . . . (46,399) (67,340) Interest (net of amounts capitalized) . . . . . . . . . . . . . . . . (23,365) (11,326) Income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (4) 4,595 Property, excise and payroll taxes . . . . . . . . . . . . . . . . . . (45,710) (41,145) -------- -------- Net cash provided by operating activities . . . . . . . . . . . . . . . 106,031 85,131 -------- -------- Investing Activities - - -------------------- Net cash used for property expenditures and other . . . . . . . . . . . (17,195) (16,975) -------- -------- Financing Activities - - -------------------- Dividends paid on common and preferred stock . . . . . . . . . . . . . . . (31,120) (29,181) Retirement of short-term debt . . . . . . . . . . . . . . . . . . . . . . (25,000) (62,000) Retirement of long-term debt . . . . . . . . . . . . . . . . . . . . . . . (38) (330,035) Issuance of long-term debt . . . . . . . . . . . . . . . . . . . . . . . . - 446,000 -------- -------- Net cash provided by (used for) financing activities . . . . . . . . . . (56,158) 24,784 -------- -------- Net increase in cash and temporary cash investments . . . . . . . . . . 32,678 92,940 Cash and temporary cash investments at beginning of period . . . . . . . . 5,980 3,679 -------- -------- Cash and temporary cash investments at end of period . . . . . . . . . . . $ 38,658 $ 96,619 ======== ========
See Notes to Consolidated Financial Statements. These interim statements are unaudited. 2
CONSOLIDATED BALANCE SHEET The Dayton Power and Light Company At At March 31, December 31, 1994 1993 ------------- ------------ --thousands-- ASSETS Electric property and plant . . . . . . . . . . . . . . . . . . . . . . . $2,935,533 $2,923,842 Gas property and plant . . . . . . . . . . . . . . . . . . . . . . . . . . 241,347 240,126 Steam property and plant . . . . . . . . . . . . . . . . . . . . . . . . . 31,978 31,978 Construction work in progress . . . . . . . . . . . . . . . . . . . . . . 35,828 35,825 ---------- ---------- 3,244,686 3,231,771 Less-- Accumulated depreciation and amortization . . . . . . . . . . . . . . . (974,687) (950,546) ---------- ---------- Net property and plant . . . . . . . . . . . . . . . . . . . . . . . . 2,269,999 2,281,225 ---------- ---------- Current Assets Cash and temporary cash investments, at cost . . . . . . . . . . . . . . . 38,658 5,980 Accounts receivable, less provision for uncollectible accounts (Note 1) . 207,242 130,113 Inventories, at average cost . . . . . . . . . . . . . . . . . . . . . . . 68,443 85,356 Taxes applicable to subsequent years . . . . . . . . . . . . . . . . . . . 46,682 72,751 Gas costs recoverable . . . . . . . . . . . . . . . . . . . . . . . . . . 11,158 23,052 Prepayments and other . . . . . . . . . . . . . . . . . . . . . . . . . . 43,874 44,874 ---------- ---------- Total current assets . . . . . . . . . . . . . . . . . . . . . . . . 416,057 362,126 ---------- ---------- Other Assets Regulatory deferrals (Note 2) . . . . . . . . . . . . . . . . . . . . . . 175,471 172,832 Income taxes recoverable through future revenues . . . . . . . . . . . . . 263,944 269,144 Other assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 131,565 129,003 ---------- ---------- Total other assets . . . . . . . . . . . . . . . . . . . . . . . . 570,980 570,979 ---------- ---------- Total Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $3,257,036 $3,214,330 ========== ==========
See Notes to Consolidated Financial Statements. These interim statements are unaudited. 3
CONSOLIDATED BALANCE SHEET (continued) The Dayton Power and Light Company At At March 31, December 31, 1994 1993 ------------- ------------ --thousands-- CAPITALIZATION AND LIABILITIES Capitalization Common shareholder's equity-- Common stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 412 $ 412 Other paid-in capital (Note 1) . . . . . . . . . . . . . . . . . . . 738,466 675,176 Earnings reinvested in the business . . . . . . . . . . . . . . . . 398,656 373,605 ---------- ---------- Total common shareholder's equity . . . . . . . . . . . . . . . 1,137,534 1,049,193 Preferred stock-- Without mandatory redemption provisions . . . . . . . . . . . . . . 82,850 82,850 With mandatory redemption provisions . . . . . . . . . . . . . . . . 30,000 30,000 Long-term debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,012,867 1,012,889 ---------- ---------- Total capitalization . . . . . . . . . . . . . . . . . . . . . . 2,263,251 2,174,932 ---------- ---------- Current Liabilities Accounts payable . . . . . . . . . . . . . . . . . . . . . . . . . . . 89,142 113,742 Short-term debt . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,805 29,805 Current portion of first mortgage bonds and preferred stock . . . . . 8,980 8,980 Accrued taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . 127,522 113,618 Accrued interest . . . . . . . . . . . . . . . . . . . . . . . . . . . 20,674 21,089 Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33,326 51,353 ---------- ---------- Total current liabilities . . . . . . . . . . . . . . . . . . . 284,449 338,587 ---------- ---------- Deferred Credits and Other Deferred taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . 534,122 536,202 Unamortized investment tax credit . . . . . . . . . . . . . . . . . . 84,110 84,858 Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 91,104 79,751 ---------- ---------- Total deferred credits and other . . . . . . . . . . . . . . . . 709,336 700,811 ---------- ---------- Total Capitalization and Liabilities . . . . . . . . . . . . . . . . . $3,257,036 $3,214,330 ========== ==========
See Notes to Consolidated Financial Statements. These interim statements are unaudited. 4 Notes to Consolidated Financial Statements 1. On March 28, 1994, DPL Inc. issued 3,200,000 shares of common stock through an Underwriting Agreement. The net proceeds of $63.2 million, included in Accounts Receivable and Other Paid-In Capital at March 31, 1994, were used to provide a capital contribution to the Company. This capital contribution was used, along with internal cash, to redeem all of the outstanding shares of the Company's Preferred Stock Series D, E, F, H and I on May 6, 1994. 2. Pursuant to the Public Utilities Commission of Ohio ("PUCO")-approved phased in electric rate increase, the third and final increase of 6.4% took effect January 1, 1994. Deferrals (including carrying charges) which were capitalized through 1993, are being recovered over seven years commencing in 1994. Regulatory deferrals on the balance sheet were:
March 31, Dec. 31, 1994 1993 --------- -------- --millions-- Phase-in $ 83.5 $ 85.8 Demand Side Management 28.9 23.3 Deferred interest - Zimmer 63.1 63.7 ------ ------ Total $175.5 $172.8 ====== ======
5 3. Statement of Cash Flow Reconciliation. Reconciliation of Net Income to Net Cash Provided by Operating Activities:
Three Months Ended March 31 1994 1993 ---- ---- --millions-- Net Income . . . . . . . . . . . . . . . . . $ 56.2 $ 54.8 Adjustments for non-cash items: Depreciation and amortization . . . . . . 27.9 27.1 Deferred income taxes . . . . . . . . . . (4.0) 4.1 Taxes applicable to subsequent years . . . 26.1 25.4 Allowance for equity funds used during construction . . . . . . . . . . (0.1) 0.1 Regulatory deferrals (Note 2) . . . . . . 2.6 (6.2) Changes in Working Capital: Accounts receivable and unbilled revenue . (13.9) (26.8) Accounts payable . . . . . . . . . .. . . (23.0) (3.2) Other . . . . . . . . . . . . . . . . . . 31.5 31.9 Other operating activities . . . . . . . . . 2.7 (22.1) ------ ------ Net cash provided by operating activities . $106.0 $ 85.1 ====== ======
4. Reclassifications have been made in certain prior years' amounts to conform to the current reporting presentation of the Company. 5. The consolidated financial statements in this report have been prepared by the Company, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to such rules and regulations. These consolidated financial statements should be read in conjunction with the financial statements and notes thereto in the Company's 1993 Annual Report on Form 10-K. The information included in this Form 10-Q reflects all adjustments which are, in the opinion of management, necessary for a fair statement of the results of operations for the periods presented. Any adjustments are of a normal recurring nature. 6
OPERATING STATISTICS The Dayton Power and Light Company Three Months Ended March 31 ------------------ 1994 1993 ---- ---- ELECTRIC Sales (millions of kWh)-- Residential . . . . . . . . . . . . . . . . . 1,426 1,372 Commercial . . . . . . . . . . . . . . . . . 749 733 Industrial . . . . . . . . . . . . . . . . . 1,039 941 Other . . . . . . . . . . . . . . . . . . . . 544 843 ------- ------- Total . . . . . . . . . . . . . . . . . . . 3,758 3,889 Revenues (thousands of dollars)-- Residential . . . . . . . . . . . . . . . . . 115,575 105,215 Commercial . . . . . . . . . . . . . . . . . 53,005 48,548 Industrial . . . . . . . . . . . . . . . . . 55,170 47,794 Other . . . . . . . . . . . . . . . . . . . . 26,548 31,391 ------- ------- Total . . . . . . . . . . . . . . . . . . . 250,298 232,948 Other Electric Statistics-- Average price per kWh-- retail and wholesale customers (cents) . . 6.60 5.92 Fuel cost per net kWh generated (cents) . . . . . . . . . . . . . 1.47 1.42 Electric customers at end of period . . . . . 465,934 461,464 Average kWh use per residential customer . . 3,417 3,317 Peak demand--maximum one hour use (mw), (net) . . . . . . . . . 2,747 2,434
7
OPERATING STATISTICS (continued) The Dayton Power and Light Company Three Months Ended March 31 ------------------ 1994 1993 ---- ---- GAS Sales (thousands of mcf)-- Residential . . . . . . . . . . . . . . . . . 14,753 13,952 Commercial . . . . . . . . . . . . . . . . . 4,284 3,911 Industrial . . . . . . . . . . . . . . . . . 1,894 1,503 Other . . . . . . . . . . . . . . . . . . . . 1,415 1,389 Transportation gas delivered . . . . . . . . 5,177 4,342 ------- ------- Total . . . . . . . . . . . . . . . . . . . 27,523 25,097 Revenues (thousands of dollars)-- Residential . . . . . . . . . . . . . . . . . 79,004 73,744 Commercial . . . . . . . . . . . . . . . . . 21,905 19,905 Industrial . . . . . . . . . . . . . . . . . 8,797 7,128 Other . . . . . . . . . . . . . . . . . . . . 9,170 9,353 ------- ------- Total . . . . . . . . . . . . . . . . . . . 118,876 110,130 Other Gas Statistics-- Average price per mcf-- retail customers (dollars) . . . . . . . . 5.21 5.17 Gas customers at end of period . . . . . . . 287,640 284,820 DEGREE DAYS (based on calendar month)-- Heating . . . . . . . . . . . . . . . . . . . 3,194 2,953 Cooling . . . . . . . . . . . . . . . . . . . 0 0
8 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations The Company's earnings for the first quarter of 1994 increased $1.6 million compared to the first quarter of 1993. The improved first quarter earnings are due to continued cost containment and increased energy sales, resulting from the strong West Central Ohio economy and cold winter weather. Electric retail sales grew 5% in the first quarter with business sales increasing 7%. On January 18, 1994, the Company's customers established a new winter peak electricity usage of 2,747 MW, exceeding the previous winter peak by 9%. Natural gas sales increased by 10% over the first quarter of 1993. An analysis of the financial condition and results of operation for the first quarter ended March 31, 1994 and 1993 is discussed below. Financial Condition - - ------------------- Construction plans are subject to continuing review and are expected to be revised in light of changes in financial and economic conditions, load forecasts, legislative and regulatory developments and changing environmental standards, among other factors. The Company's ability to complete its capital projects and the reliability of future service will be affected by its financial condition, the availability of external funds at reasonable cost and adequate and timely rate increases. In late March and early April 1994, DPL Inc. completed a public offering of 3.2 million common shares. The net proceeds were used on May 6, 1994, along with internal cash, to redeem all of the outstanding shares of the Company's Preferred Stock Series D, E, F, H and I. The preferred dividend savings will have a positive impact on earnings. As of March 31, 1994, the Company's cash and temporary cash investment balance was $39 million. The Company has available to it $97 million in short-term informal lines of credit. As of March 31, 1994, the Company had no short-term debt outstanding. DPL Inc. and its subsidiaries have $200 million available through a Revolving Credit Agreement. As of March 31, 1994, DPL Inc. had no outstanding borrowings under this Credit Agreement. The Company has authority from the PUCO to issue long and short-term debt up to a maximum limit of $300 million which could include loans from DPL Inc. under the terms of the Credit Agreement. The Company's short-term debt is limited to up to $200 million pursuant to that PUCO authorization. 9 The Company anticipates that it has sufficient capacity to issue First Mortgage Bonds to satisfy its requirements in connection with the financing of its construction and refinancing programs during the five year period 1994-1998. Results of Operations - - --------------------- Electric revenues increased $17.4 million for the first quarter of 1994. Total retail electric sales increased 5% due to cold weather and the strong local economy. Implementation of the third and final phase of the electric rate increase of 6.4% effective in January 1994 also contributed to the increase in revenues. Fuel used in electric and steam production decreased $0.8 million from last year. A decrease in purchased power costs resulted from lower sales to other utilities. Gas revenues and gas purchased for resale increased $8.7 million and $6.4 million respectively, over the first quarter of 1993. The higher amounts resulted from a weather-related gas retail sales increase of 8% and a higher gas cost recovery factor. Operating and administrative expenses decreased $3.9 million in 1994 as compared to 1993. Bond redemption costs of $15 million are included in the 1993 expenses, partially offset in 1994 by increased benefits and claims costs. Maintenance expenses increased $3.4 million over the first quarter of 1993 due to generating station and distribution maintenance activities. Interest expense decreased $1.8 million in 1994 due to the issuance of new First Mortgage Bonds in 1993 overlapping the related debt series to be redeemed and lower interest rates on long term debt obtained through refinancings. Phase-in deferrals capitalized in years prior to 1994 are being recovered over a seven year period commencing in 1994. Income taxes increased $9.8 million over the first quarter of 1993 resulting from a corresponding increase in taxable income over the same period a year ago. 10 Part II. Other Information --------------------------- Item 5. Other Information. Gas Operations and Gas Supply - - ----------------------------- The PUCO supports open access, nondiscriminatory transportation of natural gas by the state's local distribution companies for end-use customers. The PUCO has guidelines to provide a standardized structure for end-use transportation programs which require a tariff providing the prices, terms and conditions for such service. The Company filed a transportation tariff to comply with these guidelines in December 1993. That tariff was approved by the PUCO on March 30, 1994 and became effective on April 6, 1994. The tariff governs the Company's sales to end-use transportation customers. For the twelve months ended March 31, 1994, the Company had 208 end-use customers transporting 14.2 million cubic feet of natural gas under pre- existing natural gas transportation agreements or this tariff. Rate Regulations and Government Legislation - - ------------------------------------------- The Company has in place a percentage of income payment plan ("PIPP") for eligible low-income households as required by the PUCO. This plan prohibits disconnections for nonpayment of customer bills if eligible low-income households pay a specified percentage of their household income toward their utility bill. The PUCO has approved a surcharge by way of a temporary base rate tariff rider which allows companies to recover arrearages accumulated under PIPP. In 1993 the Company reached a settlement with the PUCO staff, the Office of the Ohio Consumers' Counsel and the Legal Aid Society to provide new and expanded programs for PIPP eligible customers. The expanded programs include greater arrears crediting, lower monthly payments, educational programs and information reports. In exchange, the Company may accelerate recovery of PIPP and pre-PIPP arrearages and recover program costs. The settlement also established a four year moratorium on changes to the program. The PUCO approved the settlement on December 2, 1993. Pursuant to the terms of the settlement, the Company filed an application on January 21, 1994 to lower its PIPP rate. The application was approved by the PUCO on March 24, 1994. 11 Item 6. Exhibits and Reports on Form 8-K. (b) Reports on Form 8-K ------------------- No reports on Form 8-K were filed by the Company during the quarter ended March 31, 1994. 12 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. THE DAYTON POWER AND LIGHT COMPANY ---------------------------------- (Registrant) Date: May 16, 1994 Paul R. Anderson - - ------------------------ ---------------------------------- Paul R. Anderson Controller (Principal Accounting Officer) Date: May 16, 1994 Thomas M. Jenkins - - ------------------------ ---------------------------------- Thomas M. Jenkins Group Vice President and Treasurer (Principal Financial Officer) 13 -----END PRIVACY-ENHANCED MESSAGE-----