-----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, TftmnrIZumjjYVy6UnWtDWL0vDWn9OvNL7Z3VjL7vOi2FKku+KkID8MaFeMtiov6 u6OeMBtLlWRgA8v/O+6mcQ== 0000049816-98-000028.txt : 19980821 0000049816-98-000028.hdr.sgml : 19980821 ACCESSION NUMBER: 0000049816-98-000028 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 4 CONFORMED PERIOD OF REPORT: 19980715 ITEM INFORMATION: FILED AS OF DATE: 19980715 SROS: CSX SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: ILLINOIS POWER CO CENTRAL INDEX KEY: 0000049816 STANDARD INDUSTRIAL CLASSIFICATION: 4931 IRS NUMBER: 370344645 STATE OF INCORPORATION: IL FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: SEC FILE NUMBER: 001-03004 FILM NUMBER: 98666420 BUSINESS ADDRESS: STREET 1: 500 S 27TH ST STREET 2: C/O HARRIS TRUST & SAVINGS BANK CITY: DECATUR STATE: IL ZIP: 62525-1805 BUSINESS PHONE: 2174246600 FORMER COMPANY: FORMER CONFORMED NAME: ILLINOIS IOWA POWER CO DATE OF NAME CHANGE: 19660822 8-K 1 8-K FILING TO SEC ON 07/15/98 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 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) July 15, 1998 Commission Registrants; State of Incorporation; IRS Employer File Number Address; and Telephone Company Identification No. 1-11327 Illinova Corporation 37-1319890 (an Illinois Corporation) 500 S. 27th Street Decatur, IL 62525 (217) 424-6600 1-3004 Illinois Power Company 37-0344645 (an Illinois Corporation) 500 S. 27th Street Decatur, IL 62525 (217) 424-6600 Total number of sequentially numbered pages is 8. Item 7. Exhibits (c) Exhibits (12) Statements re computation of ratios (99.1) Press Release, dated July 15, 1998 (99.2) Illinova Consolidated Income Statements 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. ILLINOVA CORPORATION (Registrant) /s/Leah Manning Stetzner --------------------------- Leah Manning Stetzner General Counsel and Corporate Secretary on behalf of Illinova Corporation Date: July 15, 1998 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. ILLINOIS POWER COMPANY (Registrant) /s/Leah Manning Stetzner --------------------------- Leah Manning Stetzner Vice President, General Counsel, and Corporate Secretary on behalf of Illinois Power Company Date: July 15, 1998 Exhibit Index The following Exhibits are hereby filed as part of this Current Report on Form 8-K: Exhibit Number Description 12 Statements re computation of ratios 99.1 Press Release, dated July 15, 1998 99.2 Illinova Consolidated Income Statements EX-12 2 EX-12 ILLINOIS POWER COMPANY STATEMENT OF COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES (Thousands of Dollars) Twelve Twelve Year to Months Months Date Ended Ended March March March** 1998 1998 1998 Earnings Available for Fixed Charges: Net Income (Loss) $25,490 $(89,636) ($89,636) Add: Income Taxes: Current 10,089 62,475 62,475 Deferred - Net 2,290 21,441 21,441 Allocated income taxes (3,378) (4,633) (4,633) Investment tax credit - deferred (1,723) (7,278) (7,278) Income tax effect of disallowed costs - - - Income tax effect of FAS 71 write-off - (117,998) (117,998) Interest on long-term debt 26,840 108,108 108,108 Amortization of debt expense and premium- net, and other interest charges 7,312 25,955 25,955 One-third of all rentals (Estimated to be representative of the interest component) 999 4,086 4,086 Interest on in-core fuel 810 3,746 3,746 Disallowed Clinton plant costs - - - FAS 71 Regulatory Write-Offs - - 313,030 ------- -------- ------- Earnings (loss) available for fixed charges $68,729 $6,266 $319,296 ======= ======== ======== Fixed charges: Interest on long-term debt $26,840 $108,108 $108,108 Amortization of debt expense and premium-net, and other interest charges 8,971 32,988 32,988 One-third of all rentals (Estimated to be representative of the interest 999 4,086 4,086 component) ------- -------- -------- Total Fixed Charges $36,810 $145,182 $145,182 ======= ======== ======== Ratio of earnings to fixed 1.87 0.04 * 2.20 charges ======== ======== ======== * Earnings are inadequate to cover fixed charges. Additional earnings (thousands) for Twelve Months Ended March 1998 of $138,916 are required to attain a one-to-one ratio of Earnings to Fixed Charges. ** Supplemental ratio of earnings to fixed charges presented to exclude write-off related to the discontinued application of provisions of SFAS 71, "Accounting for the Effects of Certain Types of Regulation" for the generation segment of the business. EX-99 3 EX-99.1 PRESS RELEASE, DATED JULY 15, 1998 For immediate release: July 15, 1998 For more information: Shirley Swarthout (217) 424-6400 NOTE: Illinova's management is taking advantage of safe harbor disclosure provisions by issuing this report which contains estimates, projections and other forward-looking statements that involve risks and uncertainties. Actual results or outcomes could differ materially from those provided in the forward-looking statements as a result of such important factors as: the outcome of state and federal regulatory proceedings affecting the restructuring of the electric and gas utility industries; the impacts of new laws and regulations relating to restructuring, environmental, and other matters have on Illinova and its subsidiaries; the effects of increased competition on the utility businesses; risks of owning and operating a nuclear facility; changes in prices and cost of fuel; factors affecting non-utility investments, such as the risk of doing business in foreign countries; construction and operation risks; and increases in financing costs. All forward-looking statements are based upon information presently available, and Illinova assumes no obligation to update any forward-looking statements. ILLINOVA POSTS SECOND-QUARTER LOSS; PREDICTS BREAK-EVEN YEAR DECATUR, Ill. -- Illinova Corp. today announced a loss of $47 million, or 66 cents per share (basic and diluted), for the second quarter 1998. This compares to earnings of $31 million, or 42 cents per share (basic and diluted), for the same period a year ago. After experiencing unprecedented and unexpected prices for power purchases during the last week of June, Illinova earlier this month said Illinois Power's projected replacement power costs in 1998 would significantly exceed previous projections and that Illinova expected modest, if any, earnings for the year. "Based on what we now know, we expect 1998 earnings to be at or near break-even," said Larry F. Altenbaumer, chief financial officer for Illinova and Illinois Power. "We base these projections on an uncertain and highly volatile electric power market, which could cause material changes to our outlook as the year progresses." The revised earnings projections are based primarily on higher purchase prices for replacement power and greater than previously projected expenditures for recovery efforts at Clinton Power Station. Replacement power costs exceeded expectations by $49 million during the second quarter, and the company recorded an additional $58 million for higher replacement power costs expected in July and August. Clinton Power Station operations and maintenance expenses (O&M) for the quarter increased by $22 million over the same period in 1997. Good progress is being made toward restarting the Clinton Power Station prior to year's end, but increased expenses are needed to support the overall recovery process. The company now projects that Clinton expenditures for 1998 will total $195 million -- approximately $45 million higher than previously expected. Altenbaumer said the added costs for replacement power and Clinton restart costs should impact only 1998's financial results and, because Clinton is expected to be back in operation by year's end, should have little effect on 1999. - 30 - Please see the attached Illinova Corp. Consolidated Statements of Income. EX-99 4 EX-99.2 ILLINOVA CONSOLIDATED STATEMENTS OF INCOME Illinova Condensed Consolidated Statements of Income
Three Months Ended Six Months Ended Twelve Months Ended June 30, June 30, June 30, ------------------------ ----------------------------- ------------------------------ % Change % Change % Change Fav/ Fav/ Fav/ 1998 1997 (Unfav) 1998 1997 (Unfav) 1998 1997 (Unfav) (Millions) (Millions) (Millions) Operating Revenues Electric $ 304.5 $301.7 1% $581.1 $583.9 - % $1,241.6 $1,225.5 1% Electric interchange 112.7 53.5 111 209.0 80.1 161 304.5 152.2 100 Gas 49.8 60.1 (17) 166.4 224.1 (26) 296.2 386.7 (23) Diversified enterprises 80.3 127.6 (37) 166.2 225.2 (26) 676.6 268.7 152 ------- ------ ------- ------- ------- ------- Total 547.3 542.9 1 1,122.7 1,113.3 1 2,518.9 2,033.1 24 ------- ------ ------- ------- ------- ------- Operating Expenses Fuel for electric plants 53.9 52.2 (3) 109.6 97.5 (12) 244.5 219.5 (11) Power purchased 229.4 45.6 - 326.5 81.4 - 463.0 123.5 - Gas purchased for resale 22.4 22.8 2 88.4 122.5 28 173.6 219.3 21 Diversified enterprises 85.0 150.8 44 179.7 259.2 31 712.8 315.9 (126) Other operating and maintenance 122.9 94.1 (31) 231.7 173.2 (34) 460.7 359.0 (28) Depreciation and amortization 50.5 49.3 (2) 101.2 98.3 (3) 201.7 191.9 (5) General taxes 34.3 33.0 (4) 73.0 71.7 (2) 135.1 133.6 (1) ------- ------ ------- ------- ------- ------- Total 598.4 447.8 (34) 1,110.1 903.8 (23) 2,391.4 1,562.7 (53) ------- ------ ------- ------- ------- ------- Operating Income (Loss) (51.1) 95.1 (154) 12.6 209.5 (94) 127.5 470.4 (73) ------- ------ ------- ------- ------- ------- Other Income and Deductions Miscellaneous - net 2.8 1.4 100 1.3 2.2 (41) 2.6 4.5 (42) Equity earnings in affiliates 3.4 2.4 42 8.9 6.4 39 20.0 7.7 160 ------- ------ ------- ------- ------- ------- Total 6.2 3.8 63 10.2 8.6 19 22.6 12.2 85 ------- ------ ------- ------- ------- ------- Income (Loss) Before Interest Charges and Income Taxes (44.9) 98.9 (145) 22.8 218.1 (90) 150.1 482.6 (69) ------- ------ ------- ------- ------- ------- Interest Charges Interest expense 35.9 36.0 - 72.5 74.2 2 142.5 145.3 2 Allowance for borrowed funds used during construction (1.2) (1.3) (8) (2.3) (2.7) (15) (4.6) (5.6) (18) Preferred dividend requirements of subsidiary 5.0 5.4 7 9.9 10.9 9 20.5 21.9 6 ------- ------ ------- ------- ------- ------- Total 39.7 40.1 1 80.1 82.4 3 158.4 161.6 2 ------- ------ ------- ------- ------- ------- Income (Loss) Before Income Taxes (84.6) 58.8 (244) (57.3) 135.7 (142) (8.3) 321.0 (103) ------- ------ ------- ------- ------- ------- Income Taxes (37.6) 27.4 237 (33.3) 60.3 155 (13.3) 134.6 110 ------- ------ ------- -------- ------- ------- Net Income(Loss) Before Extraordinary Item (47.0) 31.4 (250) (24.0) 75.4 (132) 5.0 186.4 (97) Extraordinary Item Net of Income Tax Benefit of $118.0 Million - - - - - - (195.0) - - ------- ------ ------- ------- ------- ------- Net Income (Loss) (47.0) 31.4 - (24.0) 75.4 - (190.0) 186.4 - Carrying amount over (under) consideration paid for redeemed preferred stock of subsidiary - - - - - - 0.2 (0.2) - ------- ------ ------- ------- ------- ------- Net Income (Loss) Applicable to Common Stock $ (47.0) $ 31.4 - (24.0) $ 75.4 - $(189.8) $ 186.2 - ======= ====== ======= ======= ======= ======= Weighted average common shares 71.7 75.6 71.7 75.7 72.0 75.7 Earnings (loss) per common share before extraordinary item (basic and diluted) ($0.66) $0.42 ($0.34) $1.00 $0.07 $2.46 Extraordinary item per common share (basic and diluted) - - - - ($2.71) - Earnings (loss) per common share (basic and diluted) ($0.66) $0.42 ($0.34) $1.00 ($2.64) $2.46 Cash dividends declared per common share $0.31 $0.31 $0.62 $0.62 $1.24 $1.21 Cash dividends paid per common share $0.31 $0.31 $0.62 $0.62 $1.24 $1.18
These unaudited statements are submitted as a matter of general information and are not intended to induce, or to be used in connection with, any sale or purchase of securities. These statements should be read in conjunction with Illinova's and Illinois Power Company's 1998 Quarterly Reports on Form 10-Q and Form 8-K filings to the Securities and Exchange Commission, Illinova's 1997 Annual Report to Shareholders (included in the Proxy Statement) and Illinova's and Illinois Power Company's 1997 Form 10-K filings to the Securities and Exchange Commission. -----END PRIVACY-ENHANCED MESSAGE-----