-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, ABhx8whTDFmM3HGWHd4s6Ooy7JwnC+gQ2prJOIiT1jf9bJqkssTqFd0fxy8i+eqP RMsx0h+x6/wEvjlmfkH43A== 0000912057-01-515091.txt : 20010515 0000912057-01-515091.hdr.sgml : 20010515 ACCESSION NUMBER: 0000912057-01-515091 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 20010331 FILED AS OF DATE: 20010514 FILER: COMPANY DATA: COMPANY CONFORMED NAME: DAYTON POWER & LIGHT CO CENTRAL INDEX KEY: 0000027430 STANDARD INDUSTRIAL CLASSIFICATION: ELECTRIC & OTHER SERVICES COMBINED [4931] IRS NUMBER: 310258470 STATE OF INCORPORATION: OH FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 001-02385 FILM NUMBER: 1631726 BUSINESS ADDRESS: STREET 1: PO BOX 8825 STREET 2: PO BOX 1247 CITY: DAYTON STATE: OH ZIP: 45401 BUSINESS PHONE: 5132246000 MAIL ADDRESS: STREET 1: P O BOX 8825 CITY: DAYTON STATE: OH ZIP: 45401 10-Q 1 a2049013z10-q.txt 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, 2001 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 IDENTIFICATION NO.) INCORPORATION OR ORGANIZATION) COURTHOUSE PLAZA SOUTHWEST DAYTON, OHIO 45402 --------------------------------------------------------------- (ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (937) 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 ------ ------ 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 at March 31, 2001) THE DAYTON POWER AND LIGHT COMPANY
INDEX PAGE NO. -------- PART I. FINANCIAL INFORMATION Item 1. Financial Statements Consolidated Statement of Results of Operations 3 Consolidated Statement of Cash Flows 4 Consolidated Balance Sheet 5 Consolidated Statement of Shareholder's Equity 7 Notes to Consolidated Financial Statements 8 Operating Statistics 10 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 11 Item 3. Quantitative and Qualitative Disclosures about Market Risk 14 PART II. OTHER INFORMATION Item 6. Exhibits and Reports on Form 8-K 14 Signatures 15
2 PART I. FINANCIAL INFORMATION ITEM 1. FINANCIAL STATEMENTS
THE DAYTON POWER AND LIGHT COMPANY CONSOLIDATED STATEMENT OF RESULTS OF OPERATIONS (DOLLARS IN MILLIONS) THREE MONTHS ENDED MARCH 31, --------------------------------- 2001 2000 ---- ---- REVENUES Utility Service Revenues -- Electric............................................................. $294.7 $259.5 Gas.................................................................. - 101.5 ------ ------ Total utility service revenues............................ 294.7 361.0 EXPENSES Fuel and purchased power............................................... 82.1 59.1 Gas purchased for resale............................................... - 67.6 Operation and maintenance.............................................. 33.1 46.5 Depreciation and amortization.......................................... 28.7 33.5 Amortization of regulatory assets, net................................. 12.1 5.6 General taxes.......................................................... 25.8 34.5 ------ ------ Total expenses........................................... 181.8 246.8 ------ ------ OPERATING INCOME....................................................... 112.9 114.2 Other deductions....................................................... (2.5) (7.6) Interest expense....................................................... (15.9) (18.5) ------ ------ INCOME BEFORE INCOME TAXES AND CUMULATIVE EFFECT OF ACCOUNTING CHANGE.................................................. 94.5 88.1 Income taxes........................................................... 38.0 32.0 ----- ------ INCOME BEFORE CUMULATIVE EFFECT OF ACCOUNTING CHANGE................... 56.5 56.1 Cumulative effect of accounting change, net of tax..................... 1.0 - ------ ------ NET INCOME............................................................. 57.5 56.1 Preferred dividends.................................................... 0.2 0.2 ------ ------ EARNINGS ON COMMON STOCK............................................... $ 57.3 $ 55.9 ===== =====
See Notes to Consolidated Financial Statements. These interim statements are unaudited. 3
THE DAYTON POWER AND LIGHT COMPANY CONSOLIDATED STATEMENT OF CASH FLOWS (DOLLARS IN MILLIONS) THREE MONTHS ENDED MARCH 31, ---------------------------------- 2001 2000 ------- ------- OPERATING ACTIVITIES Cash received from utility customers............................................. $292.4 $362.1 Other operating cash receipts.................................................... 29.8 5.2 Cash paid for: Fuel and purchased power.................................................... (91.7) (51.2) Purchased gas............................................................... - (41.8) Operation and maintenance labor............................................. (18.5) (20.5) Nonlabor operating expenditures............................................. (46.4) (47.3) Interest.................................................................... (25.6) (28.2) Income taxes................................................................ (2.4) (15.9) General taxes............................................................... (53.2) (56.6) ------- ------- Net cash provided by operating activities........................................ 84.4 105.8 ------- ------- INVESTING ACTIVITIES Capital expenditures............................................................. (46.6) (26.0) Proceeds from sale of natural gas retail distribution operations, net............ (90.9) - ------- ------- Net cash used for investing activities........................................... (137.5) (26.0) ------- ------- FINANCING ACTIVITIES Dividends paid on common stock................................................... (8.1) - Dividends paid on preferred stock................................................ (0.2) (0.2) Issuance (retirement) of short-term debt......................................... 74.8 (123.0) ------- ------- Net cash provided by/(used for) financing activities............................. 66.5 (123.2) ------- ------- CASH AND TEMPORARY CASH INVESTMENTS-- Net change....................................................................... 13.4 (43.4) Balance at beginning of period................................................... 8.6 95.5 ------- ------- Balance at end of period......................................................... $ 22.0 $ 52.1 ===== ======
See Notes to Consolidated Financial Statements. These interim statements are unaudited. 4
THE DAYTON POWER AND LIGHT COMPANY CONSOLIDATED BALANCE SHEET (DOLLARS IN MILLIONS) At At March 31, December 31, 2001 2000 ---------- -------------- ASSETS PROPERTY Electric property............................................................ $3,554.6 $3,522.6 Less-- Accumulated depreciation and amortization............................... (1,585.8) (1,560.4) -------- -------- Net property........................................................ 1,968.8 1,962.2 -------- -------- CURRENT ASSETS Cash and temporary cash investments.......................................... 22.0 8.6 Accounts receivable, less provision for uncollectible accounts of $9.8 and $6.8, respectively.......................................... 202.8 189.7 Inventories, at average cost................................................. 52.2 45.7 Prepaid taxes................................................................ 41.6 65.4 Prepaid public utility excise tax............................................ 29.7 14.9 Other........................................................................ 21.7 20.6 -------- -------- Total current assets.................................................... 370.0 344.9 -------- -------- OTHER ASSETS Deferred compensation plan................................................... 155.1 171.8 Income taxes recoverable through future revenues............................. 47.3 49.4 Other regulatory assets...................................................... 134.7 146.4 Other........................................................................ 73.2 76.4 -------- -------- Total other assets...................................................... 410.3 444.0 -------- -------- TOTAL ASSETS................................................................. $2,749.1 $2,751.1 ======== ========
See Notes to Consolidated Financial Statements. These interim statements are unaudited. 5
THE DAYTON POWER AND LIGHT COMPANY CONSOLIDATED BALANCE SHEET (DOLLARS IN MILLIONS) (CONTINUED) At At March 31, December 31, 2001 2000 ---------- -------------- CAPITALIZATION AND LIABILITIES CAPITALIZATION Common shareholder's equity-- Common stock............................................................. $ 0.4 $ 0.4 Other paid-in capital.................................................... 769.8 769.8 Accumulated other comprehensive income................................... 25.7 37.3 Earnings reinvested in the business...................................... 254.5 205.4 -------- -------- Total common shareholders' equity.................................... 1,050.4 1,012.9 Preferred stock............................................................... 22.9 22.9 Long-term debt................................................................ 666.4 666.5 -------- -------- Total capitalization................................................. 1,739.7 1,702.3 -------- -------- CURRENT LIABILITIES Accounts payable.............................................................. 100.8 103.9 Accrued taxes................................................................. 114.8 220.0 Accrued interest.............................................................. 8.3 19.1 Short-term debt............................................................... 74.8 - Other......................................................................... 17.0 14.3 -------- -------- Total current liabilities............................................ 315.7 357.3 -------- -------- DEFERRED CREDITS AND OTHER Deferred taxes................................................................ 432.5 429.9 Unamortized investment tax credit............................................. 59.7 60.2 Deferred compensation......................................................... 104.2 113.6 Other......................................................................... 97.3 87.8 -------- -------- Total deferred credits and other..................................... 693.7 691.5 -------- -------- TOTAL CAPITALIZATION AND LIABILITIES.......................................... $2,749.1 $2,751.1 ======= =======
See Notes to Consolidated Financial Statements. These interim statements are unaudited. 6
THE DAYTON POWER AND LIGHT COMPANY CONSOLIDATED STATEMENT OF SHAREHOLDER'S EQUITY THREE MONTHS ENDED MARCH 31, 2001 AND 2000 Common Stock Accumulated Earnings ------------------------- Other Other Reinvested Outstanding Paid-In Comprehensive in the $ in millions Shares Amount Capital Income Business Total - ----------------------------------- -------------- ---------- ------------ ---------------- -------------- ------------- 2001: Beginning balance......... 41,172,173 $0.4 $769.8 $37.3 $205.4 $1,012.9 Net income................ 57.5 Unrealized gains, net of reclassification adjustments, after tax.. (16.5) Unrealized gains on derivative instruments, after tax....... 4.9 Total comprehensive income................. 45.9 Common stock dividends.... (8.1) (8.1) Preferred stock dividends. (0.2) (0.2) Other (0.1) (0.1) -------------- ---------- ------------ ---------------- -------------- ------------- Ending balance............ 41,172,173 $0.4 $769.8 $25.7 $254.5 $1,050.4 ============== ========== ============ ================ ============== ============= 2000: Beginning balance......... 41,172,173 $0.4 $769.7 $13.6 $513.9 $1,297.6 Net income................ 56.1 Unrealized gains, net of reclassification adjustments, after tax.. 8.2 Total comprehensive income................. 64.3 Preferred stock dividends. (0.2) (0.2) Other..................... 0.1 (0.1) - -------------- ---------- ------------ ---------------- -------------- ------------- Ending balance............ 41,172,173 $0.4 $769.8 $21.7 $569.8 $1,361.7 ============== ========== ============ ================ ============== =============
See Notes to Consolidated Financial Statements. These interim statements are unaudited. 7 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 1. The Dayton Power and Light Company ("DP&L" or "the Company") is a wholly owned subsidiary of DPL Inc ("DPL"). DP&L has prepared the consolidated financial statements in this report 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 consolidated financial statements and notes thereto in the Company's 2000 Annual Report on Form 10-K. 2. Reclassifications have been made in certain prior years' amounts to conform to the current reporting presentation of the Company. In the opinion of management, the information included in this Form 10-Q reflects all adjustments that are necessary for a fair statement of the results of operations for the periods presented. Any adjustments are of a normal recurring nature. 3. The Company adopted the provisions of the Financial Accounting Standard Board's ("FASB") Statement No. 133, "Accounting for Derivative Instruments and Hedging Activities," as amended ("SFAS No. 133") as of January 1, 2001. SFAS No. 133 requires that all derivatives be recognized as either assets or liabilities in the consolidated balance sheet and be measured at fair value, and changes in the fair value be recorded in earnings, unless they are designated as hedges of an underlying transaction. As a result of adopting this accounting standard, the Company recorded a cumulative effect of accounting change of $1.0 million, net of tax. The implementation of this accounting standard did not have a material impact on the Company's financial position or results of operations. The Company uses forward and option purchase contracts as a hedge against the risk of changes in cash flows associated with expected electricity purchases. These purchases are required to meet full requirements load during times of peak demand or during planned and unplanned generation facility outages. The Company also holds forward sales contracts that hedge against the risk of changes in cash flows associated with power sales during periods of projected generation facility availability. The Company records the fair value of all these contracts as "Other Assets" on the Consolidated Balance Sheet with an offset to "Accumulated Other Comprehensive Income," which is reclassified into earnings in the month of physical receipt or delivery of power. The Company has entered into derivative contracts in order to hedge the fair value of a firm sales commitment. The fair value of the derivative contracts as well as the firm commitment are captured as "Other Assets" on the Consolidated Balance Sheet, and any hedge ineffectiveness is included as "Other Income/Deductions" on the Consolidated Statement of Results of Operations. The net impact of these contracts was immaterial during the quarter. 8 The Company also holds purchased gas contracts through November 2001, as well as emission allowance options through 2004, that are classified as derivatives not subject to hedge accounting. The fair value of these contracts is reflected as "Other Assets" on the Consolidated Balance Sheet and "Other Income/Deductions" on the Consolidated Statement of Results of Operations. The impact on net income was immaterial during the quarter. 4. In prior years, the Company had two reportable operating segments: Electric and Natural Gas. In October 2000, the Company completed the sale of substantially all of its natural gas retail distribution assets and certain liabilities. Accordingly, the Electric segment is the remaining reportable operating segment. The Electric segment generates, markets, distributes, and transmits electricity to retail and wholesale customers. Prior year amounts related to the Natural Gas segment are included in "Other."
FOR THE THREE MONTHS ENDED MARCH 31, ---------------------------------- 2001 2000 ------ ------ NET REVENUES: Electric................................. $212.6 $200.5 Other.................................... - 33.8 ------ ------ Total................................. $212.6 $234.3 ===== ===== OPERATING INCOME: Electric................................. $106.9 $ 98.4 Other (a)................................ 6.0 15.8 ------ ------ Total................................. $112.9 $114.2 ===== ===== RECONCILIATION: Operating income......................... $112.9 $114.2 Other deductions......................... (15.9) (18.5) Interest expense......................... (2.5) (7.6) ------- ------- Income before income taxes and cumulative effect of accounting change................................ $ 94.5 $ 88.1 ===== =====
(a) Includes unallocated corporate items. The first quarter of 2000 also includes operating income for the natural gas retail distribution operations, the sale of which was completed in October 2000. 9
THE DAYTON POWER AND LIGHT COMPANY OPERATING STATISTICS THREE MONTHS ENDED MARCH 31, ------------------- 2001 2000 ---- ---- ELECTRIC Sales (millions of kWh)-- Residential.................................................. 1,480 1,340 Commercial................................................... 879 825 Industrial................................................... 1,094 1,158 Wholesale and other.......................................... 1,260 872 -------- -------- Total.................................................... 4,713 4,195 Revenues (thousands of dollars)-- Residential.................................................. $120,360 $110,868 Commercial................................................... 60,556 57,027 Industrial................................................... 54,758 55,487 Wholesale and other.......................................... 59,021 36,121 -------- -------- Total.................................................... $294,695 259,503 Electric customers at end of period............................... 500,137 496,142 GAS (a) Sales (millions of MCF)-- Residential.................................................. - 11,634 Commercial................................................... - 3,554 Industrial................................................... - 1,066 Other........................................................ - 470 Transportation gas delivered................................. - 6,893 -------- -------- Total.................................................... - 23,617 Revenues (thousands of dollars)-- Residential.................................................. $ - $67,228 Commercial................................................... - 19,657 Industrial................................................... - 5,655 Other........................................................ - 8,940 -------- -------- Total.................................................... $ - 101,480 Gas customers at end of period.................................... - 309,743
(a) DP&L completed the sale of its natural gas retail distribution assets and certain liabilities in October 2000. 10 ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS The Dayton Power and Light Company ("the Company") reported earnings on common stock for the first quarter of 2001 of $57.3 million, an increase of 3% over earnings on common stock of $55.9 million for the same quarter last year. Excluding non-recurring items, first quarter earnings on common stock of $56.3 million was 4% lower than earnings on common stock of $58.6 million for the same quarter last year. The non-recurring item in the current quarter, which contributed $1 million after taxes to earnings, reflected the adoption of a new accounting standard for derivatives. The non-recurring charge in the first quarter of 2000, equal to $4.2 million before taxes, was associated with the elimination of certain compensation programs. The earnings decline was primarily attributable to the sale of the natural gas retail distribution assets and certain liabilities in October 2000. This was partially offset by a 6% increase in net electric revenues and a 29% decrease in operation and maintenance expense. FINANCIAL CONDITION At March 31, 2001, the Company's cash and temporary cash investment balance was $22.0 million. During the first quarter of 2001, investing cash flows included a cash payment of $90.9 million for income taxes associated the gain on the sale of the natural gas retail distribution assets and certain liabilities that was reported in October 2000. DPL and its subsidiaries have up to $300 million available through Revolving Credit Agreements ("Credit Agreements"). The primary purpose of the revolving credit facilities is to provide back-up liquidity for the commercial paper program. The Company had no borrowings outstanding under these Credit Agreements at March 31, 2001. The Company also has $75 million available in short-term informal lines of credit. The Company had no borrowings outstanding under these informal lines and $75 million in commercial paper outstanding at March 31, 2001. The Company currently 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 2001-2005. 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. 11 As a result of DPL's December 2000 press release regarding its exploration of strategic alternatives, Standard & Poor's placed DPL and DP&L on credit watch with developing implications in January 2001. Developing implications indicate that ratings could be raised, lowered, or affirmed. On May 2, 2001, Standard & Poor's affirmed its ratings on DPL and the Company with a stable outlook, and removed the credit watch with developing implications. This action followed DPL's announcement on February 15, 2001 that it would pursue its growth strategy as an independent company based on its merchant generation expansion plan. The current credit ratings for DPL and the Company are investment grade. RESULTS OF OPERATIONS
FOR THE THREE MONTHS ENDED MARCH 31, 2001 2000 ------------------------------------- Electric revenues........................ $294.7 $259.5 Fuel and purchased power................. 82.1 59.1 ------ ------ Net electric revenues............... $212.6 $200.4 ====== ====== Gas revenues............................. $ - $101.5 Gas purchased for resale................. - 67.6 ------ ------ Net gas revenues.................... $ - $ 33.9 ====== ====== Operating income......................... $112.9 $114.2 ====== ======
Despite increases in fuel and purchased power costs, first quarter net electric revenues increased by $12.2 million or 6% compared to last year. Wholesale revenues more than doubled as a result of a 72% increase in sales volume and higher wholesale market prices. Retail revenues were 4% higher as a result of colder weather (heating degree days increased 41%). Fuel costs increased as a result of higher prices on the wholesale market for purchased power, higher spot-market prices for coal, and a greater volume of generated power (up 11%) resulting from increased sales. The loss of net gas revenues resulted from the sale of the natural gas retail distribution assets and certain liabilities, which was completed in October 2000. First quarter operating income decreased $1.3 million or 1% compared to last year. This change was primarily attributable to the effect of the sale of the natural gas retail distribution assets and a $6.5 million increase in regulatory amortization, partially offset by the increase in net electric revenues, a $13.4 million decrease in operation and maintenance expense, and an $8.7 million decrease in general taxes. The decrease in operation and maintenance expense was attributable to decreased deferred compensation costs, the sale of the natural gas retail distribution operations, and changes in the timing of certain maintenance work, which is expected to be performed later in the year. These favorable variances were partially offset by higher uncollectible receivable expense, an increase in ash removal program expense, and higher operating costs associated with the increase in generation power. 12 The decrease in general taxes primarily resulted from changes in tax laws associated with the Ohio deregulation order. Regulatory transition cost assets of $144.8 million are being amortized over the three-year period beginning January 1, 2001 based on transition revenues. As a result, amortization expense was $12.1 million in the first quarter of 2001 as compared to $5.6 million in the same period last year. Other deductions decreased $5.1 million or 67% compared to the first quarter of last year as a result of higher executive compensation and the elimination of certain compensation programs in the prior year, and higher net realized gains in the current year. These favorable variances were partially offset by a net loss associated with derivative activity. Interest expense decreased $2.6 million or 14% compared to the first quarter of last year as a result of lower average short-term debt and higher capitalized interest, partially offset by higher long-term debt, higher long-term debt interest rates, and higher short-term debt interest rates. The effective income tax rates for the first quarter of 2001 and 2000 were 40.2% and 36.3%, respectively. The increase was primarily attributable to a $5.6 million increase in state income-based taxes resulting from the implementation of the Ohio deregulation order. Cumulative effect of an accounting change reflects the Company's adoption of the provisions of the Financial Accounting Standard Board's ("FASB") Statement No. 133, "Accounting for Derivative Instruments and Hedging Activities," as amended ("SFAS No. 133"). SFAS No. 133 requires that all derivatives be recognized as either assets or liabilities in the consolidated balance sheet and be measured at fair value, and changes in the fair value be recorded in earnings, unless they are designated as hedges of an underlying transaction. OTHER MATTERS A wholly-owned captive subsidiary of DPL provides, among other coverages, business interruption and specific risk coverage for DP&L with respect to the impact of environmental law and electric deregulation. "Insurance Claims and Costs" on DPL's Consolidated Balance Sheet includes insurance reserves of the captive subsidiary of approximately $87 million for this coverage, as well as other coverages based on actuarial methods and loss experience data. As the policy impact of electric deregulation becomes known during the three-year regulatory transition period ending December 31, 2003, either policy payments from the captive subsidiary to DP&L or release of the appropriate reserves will occur and be reflected in income. FORWARD-LOOKING STATEMENTS This report contains certain forward-looking statements regarding plans and expectations for the future. Investors are cautioned that actual outcomes and results may vary materially from those projected due to various factors beyond the Company's control, including abnormal weather, unusual maintenance or repair requirements, changes in fuel costs, increased competition, regulatory changes and decisions, changes in accounting rules and adverse economic conditions. 13 ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK The carrying value of the Company's debt was $667.3 million at December 31, 2000, consisting of the Company's first mortgage bonds, guaranteed air quality development obligations, and notes. The fair value of this debt was $666.7 million, based on current market prices or discounted cash flows using current rates for similar issues with similar terms and remaining maturities. The following table presents the principal cash repayments and related weighted average interest rates by maturity date for long-term, fixed-rate debt at December 31, 2000:
- --------------------------------------------------------------------------------------------------------------------------- Expected Maturity Date - --------------------------------------------------------------------------------------------------------------------------- 2001 2002 2003 2004 2005 Thereafter Total Fair Value - --------------------------------------------------------------------------------------------------------------------------- Long-term Debt - --------------------------------------------------------------------------------------------------------------------------- Amount ($ in millions) $1 $1 $1 $1 $1 $662.3 $667.3 $666.7 - --------------------------------------------------------------------------------------------------------------------------- Average rate 6.4% 6.4% 6.4% 6.4% 6.4% 7.4% 7.4% - ---------------------------------------------------------------------------------------------------------------------------
Because the long-term debt is at a fixed rate, the primary market risk to the Company is short-term interest rate risk. The carrying value and fair value of short-term debt was $75 million with a weighted-average interest rate of 5.5% at March 31, 2001. The interest expense risk resulting from a hypothetical 10% increase/decrease in the quarterly average cost of this debt is negligible. PART II. OTHER INFORMATION ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K (a) There are no exhibits required by Item 601 of Regulation S-K for the quarter ended March 31, 2001. (b) Reports on Form 8-K. No reports on Form 8-K were filed by the Company during the quarter ended March 31, 2001. 14 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 14, 2001 /s/ Elizabeth M. McCarthy ----------------- ------------------------------------------------ Elizabeth M. McCarthy Vice President and Chief Financial Officer Date: May 14, 2001 /s/ Stephen F. Koziar, Jr. ----------------- ------------------------------------------------ Stephen F. Koziar, Jr. Group Vice President and Secretary 15 -----END PRIVACY-ENHANCED MESSAGE-----