-----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, F09vwTDeOdE5YyVv8rLeGKuM+WYLdQaEwXok+s6cuNJqvnw2h9V9VeilY4sr4vPz q1zJ/KsajjkVHWVL0wTHXQ== /in/edgar/work/0000107832-00-000118/0000107832-00-000118.txt : 20001114 0000107832-00-000118.hdr.sgml : 20001114 ACCESSION NUMBER: 0000107832-00-000118 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 6 CONFORMED PERIOD OF REPORT: 20000930 FILED AS OF DATE: 20001113 FILER: COMPANY DATA: COMPANY CONFORMED NAME: ALLIANT ENERGY CORP CENTRAL INDEX KEY: 0000352541 STANDARD INDUSTRIAL CLASSIFICATION: [4931 ] IRS NUMBER: 391380265 STATE OF INCORPORATION: WI FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 001-09894 FILM NUMBER: 761241 BUSINESS ADDRESS: STREET 1: 222 WEST WASHNGTON AVENUE CITY: MADISON STATE: WI ZIP: 53703 BUSINESS PHONE: 6082523110 MAIL ADDRESS: STREET 1: P O BOX 2568 CITY: MADISON STATE: WI ZIP: 53701-2568 FORMER COMPANY: FORMER CONFORMED NAME: INTERSTATE ENERGY CORP DATE OF NAME CHANGE: 19980427 FORMER COMPANY: FORMER CONFORMED NAME: WPL HOLDINGS INC DATE OF NAME CHANGE: 19920703 FILER: COMPANY DATA: COMPANY CONFORMED NAME: IES UTILITIES INC CENTRAL INDEX KEY: 0000052485 STANDARD INDUSTRIAL CLASSIFICATION: [4931 ] IRS NUMBER: 420331370 STATE OF INCORPORATION: IA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 001-04117 FILM NUMBER: 761242 BUSINESS ADDRESS: STREET 1: 200 FIRST ST SE STREET 2: IES TOWER CITY: CEDAR RAPIDS STATE: IA ZIP: 52401 BUSINESS PHONE: 3193984411 FORMER COMPANY: FORMER CONFORMED NAME: IOWA ELECTRIC LIGHT & POWER CO DATE OF NAME CHANGE: 19920703 FORMER COMPANY: FORMER CONFORMED NAME: IOWA RAILWAY & LIGHT CORP DATE OF NAME CHANGE: 19670629 FILER: COMPANY DATA: COMPANY CONFORMED NAME: WISCONSIN POWER & LIGHT CO CENTRAL INDEX KEY: 0000107832 STANDARD INDUSTRIAL CLASSIFICATION: [4931 ] IRS NUMBER: 390714890 STATE OF INCORPORATION: WI FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 000-00337 FILM NUMBER: 761243 BUSINESS ADDRESS: STREET 1: 222 W WASHINGTON AVE CITY: MADISON STATE: WI ZIP: 53703 BUSINESS PHONE: 6082523311 10-Q 1 0001.txt QUARTERLY PERIOD ENDED SEPTEMBER 30, 2000 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 September 30, 2000 ------------------ or [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _______ to _______
Commission Name of Registrant, State of Incorporation, IRS Employer File Number Address of Principal Executive Offices and Telephone Number Identification Number - ----------- ----------------------------------------------------------- ---------------------- 1-9894 ALLIANT ENERGY CORPORATION 39-1380265 (a Wisconsin corporation) 222 West Washington Avenue Madison, Wisconsin 53703 Telephone (608)252-3311 0-4117-1 IES UTILITIES INC. 42-0331370 (an Iowa corporation) Alliant Energy Tower Cedar Rapids, Iowa 52401 Telephone (319)398-4411 0-337 WISCONSIN POWER AND LIGHT COMPANY 39-0714890 (a Wisconsin corporation) 222 West Washington Avenue Madison, Wisconsin 53703 Telephone (608)252-3311
Indicate by check mark whether the registrants (1) have 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 registrants were required to file such reports), and (2) have been subject to such filing requirements for the past 90 days. Yes X No ------ ------- This combined Form 10-Q is separately filed by Alliant Energy Corporation, IES Utilities Inc. and Wisconsin Power and Light Company. Information contained in the quarterly report relating to IES Utilities Inc. and Wisconsin Power and Light Company is filed by such registrant on its own behalf. Each of IES Utilities Inc. and Wisconsin Power and Light Company makes no representation as to information relating to registrants other than itself. Number of shares outstanding of each class of common stock as of October 31, 2000: Alliant Energy Corporation Common stock, $.01 par value, 79,007,414 shares outstanding IES Utilities Inc. Common stock, $2.50 par value, 13,370,788 shares outstanding (all of which are owned beneficially and of record by Alliant Energy Corporation) Wisconsin Power and Light Company Common stock, $5 par value, 13,236,601 shares outstanding (all of which are owned beneficially and of record by Alliant Energy Corporation)
CONTENTS Page ---- Part I. Financial Information 4 Item 1. Consolidated Financial Statements 4 Alliant Energy Corporation: --------------------------- Consolidated Statements of Income for the Three and Nine Months Ended September 30, 2000 and 1999 4 Consolidated Balance Sheets as of September 30, 2000 and December 31, 1999 5 Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 2000 and 1999 7 Notes to Consolidated Financial Statements 8 IES Utilities Inc.: ------------------- Consolidated Statements of Income for the Three and Nine Months Ended September 30, 2000 and 1999 15 Consolidated Balance Sheets as of September 30, 2000 and December 31, 1999 16 Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 2000 and 1999 18 Notes to Consolidated Financial Statements 19 Wisconsin Power and Light Company: ---------------------------------- Consolidated Statements of Income for the Three and Nine Months Ended September 30, 2000 and 1999 21 Consolidated Balance Sheets as of September 30, 2000 and December 31, 1999 22 Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 2000 and 1999 24 Notes to Consolidated Financial Statements 25 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 27 Item 3. Quantitative and Qualitative Disclosures About Market Risk 41 Part II. Other Information 41 Item 1. Legal Proceedings 41 Item 6. Exhibits and Reports on Form 8-K 41 Signatures 43
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DEFINITIONS Certain abbreviations or acronyms used in the text and notes of this combined Form 10-Q are defined below: Abbreviation or Acronym Definition - ----------------------- ---------- Alliant Energy...................................... Alliant Energy Corporation APB................................................. Accounting Principle Board Opinion ATC................................................. American Transmission Company, LLC Capstone............................................ Capstone Turbine Corporation CEMS................................................ Continuous Emission Monitoring System CMS Energy.......................................... CMS Energy Corporation Corporate Services.................................. Alliant Energy Corporate Services, Inc. DAEC................................................ Duane Arnold Energy Center Dth ................................................ Dekatherm EAC................................................. Energy Adjustment Clause EITF................................................ Emerging Issues Task Force EPA ................................................ United States Environmental Protection Agency FERC................................................ Federal Energy Regulatory Commission IESU................................................ IES Utilities Inc. Investments ........................................ Alliant Energy Investments, Inc. IPC................................................. Interstate Power Company ISCO................................................ Alliant Energy Industrial Services, Inc. ISO................................................. Independent System Operator IUB................................................. Iowa Utilities Board Kewaunee ........................................... Kewaunee Nuclear Power Plant kV.................................................. Kilovolt MAIN................................................ Mid-America Interconnected Network, Inc. MAPP................................................ Mid-Continent Area Power Pool McLeod ............................................. McLeodUSA Incorporated MD&A ............................................... Management's Discussion and Analysis of Financial Condition and Results of Operations MPUC................................................ Minnesota Public Utilities Commission MWH ................................................ Megawatt-Hour NMC................................................. Nuclear Management Company, LLC NOx ................................................ Nitrogen Oxides NRC................................................. Nuclear Regulatory Commission NSP................................................. Northern States Power Company OCA ................................................ Office of Consumer Advocate PGA................................................. Purchased Gas Adjustment PSCW................................................ Public Service Commission of Wisconsin PUHCA .............................................. Public Utility Holding Company Act of 1935 Resources........................................... Alliant Energy Resources, Inc. RTO................................................. Regional Transmission Organization SEC................................................. Securities and Exchange Commission SFAS................................................ Statement of Financial Accounting Standards South Beloit ....................................... South Beloit Water, Gas & Electric Company Transportation ..................................... Alliant Energy Transportation, Inc. U.S. ............................................... United States WDNR ............................................... Wisconsin Department of Natural Resources WEPCO............................................... Wisconsin Electric Power Company Whiting ............................................ Whiting Petroleum Corporation WP&L ............................................... Wisconsin Power and Light Company WPSC................................................ Wisconsin Public Service Corporation WUHCA............................................... Wisconsin Utility Holding Company Act
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PART I. FINANCIAL INFORMATION ITEM 1. CONSOLIDATED FINANCIAL STATEMENTS ALLIANT ENERGY CORPORATION CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED) For the Three Months For the Nine Months Ended September 30, Ended September 30, 2000 1999 2000 1999 - ----------------------------------------------------------------------------------------------------------------- (in thousands, except per share amounts) Operating revenues: Electric utility $480,763 $475,423 $1,248,228 $1,192,913 Gas utility 41,369 33,473 226,156 213,357 Non-regulated and other 136,290 89,440 377,453 225,035 ------------- ------------- ------------ ------------ 658,422 598,336 1,851,837 1,631,305 ------------- ------------- ------------ ------------ Operating expenses: Electric and steam production fuels 80,605 80,250 213,990 199,013 Purchased power 85,553 74,802 222,690 199,308 Cost of utility gas sold 22,660 14,458 136,642 118,468 Other operation and maintenance 223,752 196,644 677,260 531,047 Depreciation and amortization 79,625 74,542 233,506 218,656 Taxes other than income taxes 26,206 26,839 79,171 80,767 ------------- ------------- ------------ ------------ 518,401 467,535 1,563,259 1,347,259 ------------- ------------- ------------ ------------ Operating income 140,021 130,801 288,578 284,046 ------------- ------------- ------------ ------------ Interest expense and other: Interest expense 45,040 32,232 127,452 100,347 Allowance for funds used during construction (2,186) (1,667) (6,825) (5,383) Preferred dividend requirements of subsidiaries 1,679 1,677 5,035 5,029 Gain on reclassification of investments (321,349) - (321,349) - Gains on sales of McLeodUSA Inc. stock - - (10,206) (33,826) Miscellaneous, net (18,106) (15,521) (40,546) (25,528) ------------- ------------- ------------ ------------ (294,922) 16,721 (246,439) 40,639 ------------- ------------- ------------ ------------ Income before income taxes 434,943 114,080 535,017 243,407 ------------- ------------- ------------ ------------ Income taxes 175,403 42,585 213,879 91,623 ------------- ------------- ------------ ------------ Income before cumulative effect of a change in accounting principle 259,540 71,495 321,138 151,784 ------------- ------------- ------------ ------------ Cumulative effect of a change in accounting principle, net of tax 16,708 - 16,708 - ------------- ------------- ------------ ------------ Net income $276,248 $71,495 $337,846 $151,784 ============= ============= ============ ============ Average number of common shares outstanding-basic 79,004 78,569 79,001 78,187 ============= ============= ============ ============ Earnings per average common share - basic: Income before cumulative effect of a change in accounting principle $3.29 $0.91 $4.07 $1.94 Cumulative effect of a change in accounting principle 0.21 - 0.21 - ------------- ------------- ------------ ------------ Net income $3.50 $0.91 $4.28 $1.94 ============= ============= ============ ============ Average number of common shares outstanding- diluted 79,160 78,571 79,202 78,191 ============= ============= ============ ============ Earnings per average common share - diluted: Income before cumulative effect of a change in accounting principle $3.28 $0.91 $4.06 $1.94 Cumulative effect of a change in accounting principle 0.21 - 0.21 - ------------- ------------- ------------ ------------ Net income $3.49 $0.91 $4.27 $1.94 ============= ============= ============ ============ Dividends declared per common share $0.50 $0.50 $1.50 $1.50 ============= ============= ============ ============ The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.
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ALLIANT ENERGY CORPORATION CONSOLIDATED BALANCE SHEETS September 30, 2000 December 31, ASSETS (Unaudited) 1999 - ---------------------------------------------------------------------------------------------------------------------------------- (in thousands) Property, plant and equipment: Utility - Plant in service - Electric $5,158,283 $5,032,675 Gas 565,054 540,874 Other 462,159 458,547 -------------------- -------------------- 6,185,496 6,032,096 Less - Accumulated depreciation 3,258,295 3,077,459 -------------------- -------------------- 2,927,201 2,954,637 Construction work in progress 142,603 119,276 Nuclear fuel, net of amortization 46,568 54,363 -------------------- -------------------- 3,116,372 3,128,276 Other property, plant and equipment, net of accumulated depreciation and amortization of $204,187 and $184,722, respectively 474,657 357,758 -------------------- -------------------- 3,591,029 3,486,034 -------------------- -------------------- - ---------------------------------------------------------------------------------------------------------------------------------- Current assets: Cash and temporary cash investments 71,269 113,669 Accounts receivable: Customer, less allowance for doubtful accounts of $2,783 and $2,253, respectively 77,589 67,299 Unbilled utility revenues 59,874 48,033 Other, less allowance for doubtful accounts of $465 and $954, respectively 19,101 30,095 Production fuel, at average cost 54,416 49,657 Materials and supplies, at average cost 55,662 52,440 Gas stored underground, at average cost 45,933 23,151 Regulatory assets 29,562 33,439 Prepaid gross receipts tax 16,760 20,864 Other 55,608 47,339 -------------------- -------------------- 485,774 485,986 -------------------- -------------------- - ---------------------------------------------------------------------------------------------------------------------------------- Investments: Investment in available-for-sale securities of McLeodUSA Inc. 588,642 1,123,790 Investment in trading securities of McLeodUSA Inc. 223,726 -- Investments in foreign entities 529,581 198,055 Nuclear decommissioning trust funds 291,280 271,258 Other 173,412 59,866 -------------------- -------------------- 1,806,641 1,652,969 -------------------- -------------------- - ---------------------------------------------------------------------------------------------------------------------------------- Other assets: Regulatory assets 255,795 263,610 Deferred charges and other 208,202 187,084 -------------------- -------------------- 463,997 450,694 -------------------- -------------------- - ---------------------------------------------------------------------------------------------------------------------------------- Total assets $6,347,441 $6,075,683 ==================== ==================== - ---------------------------------------------------------------------------------------------------------------------------------- The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.
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ALLIANT ENERGY CORPORATION CONSOLIDATED BALANCE SHEETS (CONTINUED) September 30, 2000 December 31, CAPITALIZATION AND LIABILITIES (Unaudited) 1999 - ------------------------------------------------------------------------------------------------------------------------------------ (in thousands, except share amounts) Capitalization: Common stock - $.01 par value - authorized 200,000,000 shares; outstanding 79,010,970 and 78,984,014 shares, respectively $790 $790 Additional paid-in capital 947,498 942,408 Retained earnings 796,835 577,464 Accumulated other comprehensive income 333,850 634,903 Shares acquired for deferred compensation trust - 27,516 shares at an average cost of $29.47 per share (811) - --------------------- --------------------- Total common equity 2,078,162 2,155,565 --------------------- --------------------- Cumulative preferred stock of subsidiaries, net 113,752 113,638 Long-term debt (excluding current portion) 1,591,859 1,486,765 --------------------- --------------------- 3,783,773 3,755,968 --------------------- --------------------- - ------------------------------------------------------------------------------------------------------------------------------------ Current liabilities: Current maturities and sinking funds 92,704 54,795 Variable rate demand bonds 55,100 55,100 Commercial paper 412,755 374,673 Notes payable 35,034 50,046 Accounts payable 184,675 191,149 Accrued interest 39,035 24,818 Accrued taxes 119,309 78,825 Other 129,252 104,219 --------------------- --------------------- 1,067,864 933,625 --------------------- --------------------- - ------------------------------------------------------------------------------------------------------------------------------------ Other long-term liabilities and deferred credits: Accumulated deferred income taxes 957,998 1,018,482 Accumulated deferred investment tax credits 68,719 71,857 Derivative liability 185,976 - Environmental liabilities 66,260 65,327 Pension and other benefit obligations 62,582 61,988 Other 154,269 168,436 --------------------- --------------------- 1,495,804 1,386,090 --------------------- --------------------- - ------------------------------------------------------------------------------------------------------------------------------------ Total capitalization and liabilities $6,347,441 $6,075,683 ===================== ===================== - ------------------------------------------------------------------------------------------------------------------------------------ The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.
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ALLIANT ENERGY CORPORATION CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) For the Nine Months Ended September 30, 2000 1999 - --------------------------------------------------------------------------------------------------------------- (in thousands) Cash flows from operating activities: Net income $337,846 $151,784 Adjustments to reconcile net income to net cash flows from operating activities: Depreciation and amortization 233,506 218,656 Amortization of nuclear fuel 13,907 14,099 Amortization of deferred energy efficiency expenditures 19,065 19,433 Deferred taxes and investment tax credits 117,229 (14,281) Refueling outage provision 7,372 6,193 Gains on dispositions of assets, net (18,390) (44,534) Gain on reclassification of investments (321,349) - Cumulative effect of a change in accounting principle, net of tax (16,708) - Equity income from unconsolidated investments, net (12,598) (3,443) Other (3,459) (3,069) Other changes in assets and liabilities: Accounts receivable (11,137) (4,255) Notes receivable 5,965 7,193 Income tax refunds receivable (3,891) 1,270 Production fuel (4,759) 6,152 Gas stored underground (22,782) 558 Prepaid gross receipts tax 4,104 5,650 Accounts payable (6,474) (25,910) Accrued payroll and vacations 2,134 6,056 Accrued interest 14,217 2,326 Accrued taxes 40,484 15,299 Adjustment clause balances (2,408) (17,228) Benefit obligations and other (11,637) 24,810 -------------------- -------------------- Net cash flows from operating activities 360,237 366,759 -------------------- -------------------- - --------------------------------------------------------------------------------------------------------------- Cash flows from (used for) financing activities: Common stock dividends declared (118,475) (117,121) Proceeds from issuance of common stock 817 28,652 Net change in Resources' credit facility 51,652 76,995 Proceeds from issuance of exchangeable senior notes 402,500 - Proceeds from issuance of other long-term debt 118,649 12,162 Reductions in other long-term debt (63,282) (73,784) Net change in other short-term borrowings (28,550) 30,233 Principal payments under capital lease obligations (8,611) (9,461) Other (15,501) 179 -------------------- -------------------- Net cash flows from (used for) financing activities 339,199 (52,145) -------------------- -------------------- --------------------------------------------------------------------------------------------------------------- Cash flows used for investing activities: Construction and acquisition expenditures: Utility (212,440) (182,039) Non-regulated businesses (564,568) (131,374) Nuclear decommissioning trust funds (19,879) (19,879) Proceeds from disposition of assets 69,355 71,718 Shared savings program (15,819) (15,219) Other 1,515 (620) -------------------- -------------------- Net cash flows used for investing activities (741,836) (277,413) -------------------- -------------------- --------------------------------------------------------------------------------------------------------------- Net increase (decrease) in cash and temporary cash investments (42,400) 37,201 -------------------- -------------------- - --------------------------------------------------------------------------------------------------------------- Cash and temporary cash investments at beginning of period 113,669 31,827 -------------------- -------------------- --------------------------------------------------------------------------------------------------------------- Cash and temporary cash investments at end of period $71,269 $69,028 ==================== ==================== --------------------------------------------------------------------------------------------------------------- Supplemental cash flow information: Cash paid during the period for: Interest $111,202 $93,854 ==================== ==================== Income taxes $61,298 $89,773 ==================== ==================== Noncash investing and financing activities: Capital lease obligations incurred $338 $23,793 ==================== ==================== --------------------------------------------------------------------------------------------------------------- The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.
-7- ALLIANT ENERGY CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) 1. The interim consolidated financial statements included herein have been prepared by Alliant Energy, without audit, pursuant to the rules and regulations of the SEC. Accordingly, certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted, although management believes that the disclosures are adequate to make the information presented not misleading. The consolidated financial statements include Alliant Energy and its consolidated subsidiaries (including IESU, WP&L, IPC, Resources and Corporate Services). These financial statements should be read in conjunction with the financial statements and the notes thereto included in Alliant Energy's, IESU's and WP&L's latest Annual Report on Form 10-K. In the opinion of management, all adjustments, which are normal and recurring in nature, necessary for a fair presentation of (a) the consolidated results of operations for the three and nine months ended September 30, 2000 and 1999, (b) the consolidated financial position at September 30, 2000 and December 31, 1999, and (c) the consolidated statement of cash flows for the nine months ended September 30, 2000 and 1999, have been made. Because of the seasonal nature of IESU's, WP&L's and IPC's operations, results for the three and nine months ended September 30, 2000 are not necessarily indicative of results that may be expected for the year ending December 31, 2000. Certain prior period amounts have been reclassified on a basis consistent with the 2000 presentation. -8- 2. Alliant Energy's comprehensive income (loss), and the components of other comprehensive income (loss), net of taxes, were as follows (in thousands):
For the Three Months Ended For the Nine Months September 30, Ended September 30, 2000 1999 2000 1999 --------------- -- -------------- --------------- --- ------------- Net income $276,248 $71,495 $337,846 $151,784 Other comprehensive income (loss): Unrealized gains (losses) on securities: Unrealized holding gains (losses) arising during period, net of tax (1) (132,251) 177,896 (63,414) 337,669 Less: adjustment for gain on reclassification of investments included in net income, net of tax (2) (187,296) -- (187,296) -- Less: reclassification adjustment for other gains included in net income, net of tax (3) (238) -- (6,566) (21,324) --------------- -------------- --------------- ------------- Net unrealized gains (losses) on securities (319,785) 177,896 (257,276) 316,345 --------------- -------------- --------------- ------------- Foreign currency translation adjustments (22,335) (2,884) (40,553) (3,737) --------------- -------------- --------------- ------------- Unrealized losses on derivatives qualified as hedges: Unrealized holding losses arising during period due to cumulative effect of a change in accounting principle, net of tax (6,582) -- (6,582) -- Other unrealized holding losses arising during period, net of tax (177) -- (177) -- Less: reclassification adjustment for losses included in net income, net of tax 3,535 -- 3,535 -- --------------- -------------- --------------- ------------- Net unrealized losses on qualifying derivatives (3,224) -- (3,224) -- --------------- -------------- --------------- ------------- Other comprehensive income (loss) (345,344) 175,012 (301,053) 312,608 --------------- -------------- --------------- ------------- Comprehensive income (loss) ($69,096) $246,507 $36,793 $464,392 =============== ============== =============== =============
(1) Primarily due to quarterly adjustments to the estimated fair value of Alliant Energy's investments in McLeod and Capstone. Alliant Energy invested $10 million in Capstone in March 2000. Capstone and Resources also entered into a non-exclusive distribution agreement in which Resources will act as a distributor for Capstone's MicroTurbine power generation systems and solutions. (2) Prior to the adoption of SFAS 133, "Accounting for Derivative Instruments and Hedging Activities," changes in the fair value of all of Alliant Energy's McLeod stock holdings had been recorded in the accumulated other comprehensive income component of common equity on Alliant Energy's Consolidated Balance Sheets, as these securities had been classified as available-for-sale. With the adoption of SFAS 133 on July 1, 2000, Alliant Energy designated 15.6 million of its beneficial ownership in approximately 57 million shares of McLeod stock as trading securities. Alliant Energy recorded pre-tax net income of $321 million in the third quarter of 2000, relating to the unrealized appreciation in value of the 15.6 million shares. Subsequent changes in the fair value of the shares designated as trading will be reflected as increases or decreases in Alliant Energy's net income. Refer to Note 10 for additional information. (3) The first quarter 2000 earnings included a pre-tax gain of $10.2 million ($0.08 per basic and diluted share) from the sale of 450,000 shares (as -9- adjusted for the 3-for-1 stock split effective April 2000) of McLeod stock held by Alliant Energy. The second quarter 1999 earnings included a pre-tax gain of $33.8 million ($0.27 per basic and diluted share) from the sale of approximately 3,840,000 shares (as adjusted for both the 2-for-1 stock split effective July 1999 and the 3-for-1 stock split effective April 2000) of McLeod stock held by Alliant Energy. Alliant Energy still held beneficial ownership in approximately 57 million shares of McLeod stock as of September 30, 2000. 3. Certain financial information relating to Alliant Energy's significant business segments is presented below:
------------------------------------------------------ Regulated Domestic Utilities Alliant ------------------------------------------------------ Non-regulated Energy Electric Gas Other Total Businesses Other Consolidated -------------------------------------------------------------------------------------------------- (in thousands) Three Months Ended September 30, 2000 ------------------ Operating revenues $480,763 $41,369 $8,507 $530,639 $128,485 ($702) $658,422 Operating income (loss) 143,962 (2,938) 1,613 142,637 (2,704) 88 140,021 Net income (loss) 68,378 208,038 (168) 276,248 Three Months Ended September 30, 1999 ------------------ Operating revenues $475,423 $33,473 $6,892 $515,788 $83,069 ($521) $598,336 Operating income (loss) 137,795 (4,906) (71) 132,818 (1,969) (48) 130,801 Net income 62,805 7,359 1,331 71,495 Nine Months Ended September 30, 2000 ------------------ Operating revenues $1,248,228 $226,156 $24,085 $1,498,469 $355,257 ($1,889) $1,851,837 Operating income (loss) 268,834 11,167 4,133 284,134 4,490 (46) 288,578 Net income (loss) 127,487 213,898 (3,539) 337,846 Nine Months Ended September 30, 1999 ------------------ Operating revenues $1,192,913 $213,357 $23,916 $1,430,186 $202,863 ($1,744) $1,631,305 Operating income 262,565 17,015 3,812 283,392 296 358 284,046 Net income 124,710 27,013 61 151,784
Net income for the three and nine months ended September 30, 2000 included $204 million (primarily all at Alliant Energy's non-regulated businesses) relating to Alliant Energy's adoption of a new accounting pronouncement, SFAS 133, on July 1, 2000. Refer to Note 10 for additional information. Resources' (i.e., the non-regulated businesses) assets increased $241 million during the first nine months of 2000, primarily due to Alliant Energy's investment in various Brazilian utilities and the increase in market value of its investment in Capstone, partially offset by the decrease in market value of its investment in McLeod. On January 25, 2000, Resources acquired a stake in four Brazilian electric utilities for a total of approximately $347 million. Intersegment revenues were not material to Alliant Energy's operations. 4. The provisions for income taxes are based on the estimated annual effective tax rate, which differs from the federal statutory rate of 35% principally due to: state income taxes, tax credits, effects of utility rate making and certain non-deductible expenses. The adoption of SFAS 133 will increase Alliant Energy's 2000 effective tax rate. 5. At September 30, 2000, Alliant Energy had $530 million of investments in foreign entities on its Consolidated Balance Sheet that primarily included -10- investments in various Brazilian electric utilities, investments in various New Zealand utility entities, an Australian generation entity, investments in various generation facilities in China and an investment in secured debentures of a development project in Mexico. The Brazil, China, Australia and a portion of the New Zealand investments are accounted for under the equity method. The remainder of the New Zealand investments are accounted for under the cost method. The geographic concentration of Alliant Energy's investments in foreign entities at September 30, 2000, included investments of approximately $351 million in Brazil, $88 million in New Zealand and Australia, $73 million in China and $18 million in Mexico. 6. Summary financial information for Resources was as follows (in thousands): September 30, 2000 ------------------ Current assets $139,862 Non-current assets 1,949,544 Current liabilities 297,402 Non-current liabilities (excludes minority interest) 648,853 Minority interest (primarily real estate joint ventures) 7,452 Refer to the "Non-regulated Businesses" column of Note 3 for summary income statement data of Resources. Alliant Energy has not presented separate financial statements for Resources because it is a wholly-owned subsidiary of Alliant Energy and because management has determined that such information is not material to holders of senior notes of Resources. Alliant Energy has fully and unconditionally guaranteed the payment of principal and interest on the senior notes. 7. On February 1, 2000, Resources completed a private placement of $402.5 million of exchangeable senior notes due 2030. The exchangeable senior notes have a stated interest rate of 7.25% through February 15, 2003 and 2.5% thereafter and are exchangeable for cash based upon a percentage of the value of McLeod Class A Common Stock. As of July 1, 2000, with the adoption of SFAS 133, the exchangeable senior notes are classified as two separate components on the Consolidated Balance Sheets as long-term debt and derivative liability. (Refer to Note 10.) WP&L issued $100 million of senior unsecured debentures in March 2000 at a fixed interest rate of 7-5/8%, due 2010. The net proceeds from the sale of the debentures were primarily used to repay short-term debt. 8. EITF 99-2, "Accounting for Weather Derivatives," requires the use of the intrinsic value method to account for weather derivatives. In August 2000, WP&L entered into a non-exchange traded weather floor with a contract period from November 1, 2000 to March 31, 2001 that requires the counterparty pay WP&L $11,000 per heating degree-day less than 5,600 during the contract period. The maximum payout amount by the counterparty on this floor is $7,000,000. WP&L paid a premium to enter into this contract, which is being amortized to expense over the contract period. WP&L will account for this contract as a degree-day swap, using the intrinsic value method, in accordance with EITF 99-2. 9. A reconciliation of the weighted average common shares outstanding used in the basic and diluted earnings per share calculation was as follows:
For the Three Months Ended For the Nine Months Ended September 30, September 30, 2000 1999 2000 1999 ------------------------------------- ------------------------------------- Weighted average common shares outstanding: Basic earnings per share calculation 79,003,569 78,568,537 79,000,683 78,187,413 Effect of dilutive securities 156,164 2,383 201,033 3,322 ------------------------------------- ------------------------------------- Diluted earnings per share calculation 79,159,733 78,570,920 79,201,716 78,190,735 ===================================== =====================================
For the nine months ended September 30, 2000, 1,644,377 options to purchase shares of common stock, with an average exercise price of $30.15, were excluded from the calculation of diluted earnings per share as the exercise prices were greater than the average market price. -11- 10. Alliant Energy adopted SFAS 133 as of July 1, 2000. SFAS 133 requires that every derivative instrument be recorded on the balance sheet as an asset or liability measured at its fair value and that changes in the derivative's fair value be recognized currently in earnings unless specific hedge accounting criteria are met. SFAS 133 requires that as of the date of initial adoption, the difference between the fair market value of derivative instruments recorded on the balance sheet and the previous carrying amount of those derivatives be reported in net income or other comprehensive income, as appropriate, as the cumulative effect of a change in accounting principle in accordance with APB 20, "Accounting Changes." In the third quarter of 2000, Alliant Energy recorded net income of $16.7 million for a cumulative effect of a change in accounting principle representing the impact of adopting SFAS 133 as of July 1, 2000. This transition adjustment was primarily the result of the difference between the carrying amount of the exchangeable senior notes issued in February 2000 under the applicable accounting principles in effect at June 30, 2000, and the carrying values of the debt and derivative components of the notes as determined in accordance with SFAS 133 as of July 1, 2000. Transition adjustments relating to Alliant Energy's other derivative instruments had no material impact on net income. A limited number of Alliant Energy's fixed price commodity contracts are defined as derivatives under SFAS 133. The fair market values of these derivative instruments have been recorded as assets and liabilities on the balance sheet and in the transition adjustment in accordance with the transition provisions of SFAS 133. Future changes in the fair market values of these instruments, to the extent that the hedges are effective at mitigating the underlying commodity risk, will be recorded in other comprehensive income. At the date the underlying transaction occurs, the amounts accumulated in other comprehensive income will be reported in the Consolidated Statements of Income. To the extent that the hedges are not effective, the ineffective portion of the changes in fair market value will be recorded directly in earnings. The financial statement impact of recording the various SFAS 133 transactions at July 1, 2000 was as follows (in millions):
Amount Financial Statement Account Financial Statement Increase (Decrease) - ----------------------------------------------------- ------------------------ ------------------------- Other assets Balance sheet $2.0 Other liabilities (a) Balance sheet 302.2 Cumulative effect of a change in accounting principle (other comprehensive income) Balance sheet (6.6) Other comprehensive income (b) Balance sheet (187.3) Long-term debt (c) Balance sheet (310.3) Cumulative effect of a change in accounting principle Income statement 16.7 Pre-tax gain on transfer to trading account (d) Income statement 321.4 Deferred tax expense (d) Income statement 134.1
(a) Includes the embedded derivative component of Resources' exchangeable senior notes of $283.7 million (b) Represents the net of tax reduction to other comprehensive income resulting from the classification of approximately 15.6 million shares of McLeod as trading securities (equal to net amount of two line items in (d)) (c) Adjustment to the debt component of Resources' exchangeable senior notes (d) Gain and tax expenses associated with the transfer of approximately 15.6 million shares of McLeod from available-for-sale securities to trading securities During the third quarter of 2000, $3.5 million of net losses included in the cumulative effect of a change in accounting principle component of accumulated other comprehensive income were reclassified into earnings, resulting in a remaining balance of ($3.1) million as of September 30, 2000. Alliant Energy's primary market risk exposures are associated with interest rates, commodity prices, equity prices and currency exchange rates. Alliant Energy has risk management policies to monitor and assist in -12- controlling these market risks and uses derivative instruments to manage some of the exposures. As of September 30, 2000, Alliant Energy held derivative instruments designated as cash flow hedging instruments and other derivatives. The cash flow hedging instruments are comprised of natural gas swaps and coal purchase and sales contracts which are used to manage the price of anticipated coal purchases and sales. WP&L utilizes gas commodity swap arrangements for the purpose of mitigating the impact of price fluctuations on gas purchased and injected into storage during the summer months and withdrawn and sold at current prices during the winter months pursuant to the natural gas cost incentive sharing mechanism with customers in Wisconsin. The gas commodity swaps in place hedge the forecasted sales of natural gas withdrawn from storage during this period. For the three and nine months ended September 30, 2000, a net gain of approximately $70,000 was recognized in earnings (recorded in gas revenues) representing the amount of hedge ineffectiveness. Alliant Energy did not exclude any components of the derivative instruments' gain or loss from the assessment of hedge effectiveness and there were no reclasses into earnings as a result of the discontinuance of hedges. As of September 30, 2000, the maximum length of time over which Alliant Energy is hedging its exposure to the variability in future cash flows for forecasted transactions is nine months and Alliant Energy estimates that losses of $3.1 million will be reclassified from accumulated other comprehensive income into earnings within the 12 months between October 1, 2000 and September 30, 2001 as the hedged transactions affect earnings. Alliant Energy's derivatives that have not been designated in hedge relationships include the embedded derivative component of Resources' exchangeable senior notes, oil swaps and collars, natural gas swaps, electricity price collars and an equity put option. At maturity, the holders of Resources' exchangeable senior notes are paid the higher of the principal amount of the notes or an amount based on the value of McLeod common stock. SFAS 133 requires that Alliant Energy split the value of the notes into a debt component and a derivative component. The payment feature tied to McLeod stock is considered an embedded derivative under SFAS 133 that must be accounted for as a separate derivative instrument. This component is classified as a derivative liability on the Consolidated Balance Sheets. Subsequent changes in the fair market value of the option will be reflected as an increase or decrease in Alliant Energy's reported net income. The carrying amount of the host debt security, classified as long-term debt, will be adjusted for amortization of the debt discount in accordance with the interest method as prescribed by APB 21, "Interest on Receivables and Payables." Prior to the adoption of SFAS 133, changes in fair value of all of Alliant Energy's McLeod stock holdings had been recorded in the accumulated other comprehensive income component of common equity on Alliant Energy's Consolidated Balance Sheets, as these securities had been classified as available-for-sale. With the adoption of SFAS 133, Alliant Energy designated 15.6 million of its beneficial ownership in approximately 57 million shares of McLeod stock as trading securities. Subsequent changes in the fair value of the shares designated as trading will be reflected as increases or decreases in Alliant Energy's net income. These trading gains or losses are expected to correspond with and substantially offset changes in the intrinsic value of the derivative component of Resources' exchangeable senior notes. Changes in the time value portion of the derivative component will result in non-cash increases or decreases to Alliant Energy's net income. Included in "Miscellaneous, net" in Alliant Energy's Consolidated Statements of Income for both the three and nine months ended September 30, 2000, was expense of $99.7 million related to the third quarter change in value of the McLeod trading securities, largely offset by income of $97.8 million related to the third quarter change in value of the derivative component of the exchangeable senior notes. Whiting is exposed to commodity price risk in the pricing of its oil and gas production. Alliant Energy utilizes oil swaps and collars and natural gas swaps, which have not been designated in hedge relationships, to mitigate the impact of oil and gas price fluctuations. These derivatives are recorded at their fair market value as a component of derivative liability on the Consolidated Balance Sheets and as a component of non-regulated and other revenues in the Consolidated Statements of Income. -13- Alliant Energy's utility businesses use electricity price collars, which have not been designated in hedge relationships, to manage energy costs during supply/demand imbalances. As of September 30, 2000, these derivatives were recorded at their fair market value as derivative assets, derivative liabilities and regulatory assets on the Consolidated Balance Sheets in Iowa, and as derivative assets and derivative liabilities on the Consolidated Balance Sheets and purchased power expense in the Consolidated Statements of Income in Wisconsin. Alliant Energy has a written put option, which gives the counterparty the right to sell approximately 6 billion of Cataguazes' Preferred A Shares to Alliant Energy Holdings do Brasil Limitada. This option expires in January 2001, has not been designated in a hedge relationship and was acquired as part of Alliant Energy's investment in Brazil. As of September 30, 2000, this derivative was recorded at its fair market value as a derivative liability on the Consolidated Balance Sheets and changes in the fair market value of the option since the date of the investment in Brazil have been recorded as a component of miscellaneous, net in the Consolidated Statements of Income. -14-
IES UTILITIES INC. CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED) For the Three Months For the Nine Months Ended September 30, Ended September 30, 2000 1999 2000 1999 - ----------------------------------------------------------------------------------------------------------------------------------- (in thousands) Operating revenues: Electric utility $202,899 $206,148 $496,934 $488,374 Gas utility 20,893 16,648 107,767 99,956 Steam 7,126 5,532 20,298 20,056 -------------- ---------------- ----------------- ------------------ 230,918 228,328 624,999 608,386 -------------- ---------------- ----------------- ------------------ - ---------------------------------------------------------------------------------------------------------------------------------- Operating expenses: Electric and steam production fuels 26,806 31,064 88,440 69,937 Purchased power 28,324 22,057 59,464 62,349 Cost of gas sold 13,253 8,777 68,291 58,313 Other operation and maintenance 48,160 56,370 158,865 171,453 Depreciation and amortization 26,856 25,481 80,555 76,444 Taxes other than income taxes 11,630 12,452 35,562 37,535 -------------- ---------------- ----------------- ------------------ 155,029 156,201 491,177 476,031 -------------- ---------------- ----------------- ------------------ - ---------------------------------------------------------------------------------------------------------------------------------- Operating income 75,889 72,127 133,822 132,355 -------------- ---------------- ----------------- ------------------ - ---------------------------------------------------------------------------------------------------------------------------------- Interest expense and other: Interest expense 12,613 11,765 38,208 39,403 Allowance for funds used during construction (764) (424) (1,827) (1,808) Miscellaneous, net 305 (213) (5,861) (3,568) -------------- ---------------- ----------------- ------------------ 12,154 11,128 30,520 34,027 -------------- ---------------- ----------------- ------------------ - ---------------------------------------------------------------------------------------------------------------------------------- Income before income taxes 63,735 60,999 103,302 98,328 -------------- ---------------- ----------------- ------------------ - ---------------------------------------------------------------------------------------------------------------------------------- Income taxes 26,373 25,521 43,285 41,349 -------------- ---------------- ----------------- ------------------ - ---------------------------------------------------------------------------------------------------------------------------------- Net income 37,362 35,478 60,017 56,979 -------------- ---------------- ----------------- ------------------ - ---------------------------------------------------------------------------------------------------------------------------------- Preferred dividend requirements 229 229 686 686 -------------- ---------------- ----------------- ------------------ - ---------------------------------------------------------------------------------------------------------------------------------- Earnings available for common stock $37,133 $35,249 $59,331 $56,293 ============== ================ ================= ================== - ---------------------------------------------------------------------------------------------------------------------------------- The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.
-15-
IES UTILITIES INC. CONSOLIDATED BALANCE SHEETS September 30, 2000 December 31, ASSETS (Unaudited) 1999 - ----------------------------------------------------------------------------------------------------------------------------------- (in thousands) Property, plant and equipment: Utility - Plant in service - Electric $2,234,056 $2,196,895 Gas 217,774 207,769 Steam 59,988 59,929 Common 141,221 147,845 ------------------- -------------------- 2,653,039 2,612,438 Less - Accumulated depreciation 1,379,402 1,311,996 ------------------- -------------------- 1,273,637 1,300,442 Construction work in progress 62,508 37,572 Leased nuclear fuel, net of amortization 29,341 39,284 ------------------- -------------------- 1,365,486 1,377,298 Other property, plant and equipment, net of accumulated depreciation and amortization of $2,203 and $2,094, respectively 5,625 5,481 ------------------- -------------------- 1,371,111 1,382,779 ------------------- -------------------- - ----------------------------------------------------------------------------------------------------------------------------------- Current assets: Cash and temporary cash investments 6,615 5,720 Accounts receivable: Customer, less allowance for doubtful accounts of $321 and $824, respectively 23,514 14,130 Associated companies 2,581 5,696 Other, less allowance for doubtful accounts of $323 and $817, respectively 10,217 12,864 Production fuel, at average cost 12,803 12,312 Materials and supplies, at average cost 24,812 24,722 Gas stored underground, at average cost 23,819 11,462 Adjustment clause balances 9,561 11,099 Regulatory assets 17,100 18,569 Prepayments and other 2,814 8,928 ------------------- -------------------- 133,836 125,502 ------------------- -------------------- - ----------------------------------------------------------------------------------------------------------------------------------- Investments: Nuclear decommissioning trust funds 114,848 105,056 Other 6,104 6,119 ------------------- -------------------- 120,952 111,175 ------------------- -------------------- - ----------------------------------------------------------------------------------------------------------------------------------- Other assets: Regulatory assets 117,236 123,031 Deferred charges and other 13,108 13,321 ------------------- -------------------- 130,344 136,352 ------------------- -------------------- - ----------------------------------------------------------------------------------------------------------------------------------- Total assets $1,756,243 $1,755,808 =================== ==================== - ----------------------------------------------------------------------------------------------------------------------------------- The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.
-16-
IES UTILITIES INC. CONSOLIDATED BALANCE SHEETS (CONTINUED) September 30, 2000 December 31, CAPITALIZATION AND LIABILITIES (Unaudited) 1999 - ------------------------------------------------------------------------------------------------------------------------------- (in thousands, except share amounts) Capitalization: Common stock - $2.50 par value - authorized 24,000,000 shares; 13,370,788 shares outstanding $33,427 $33,427 Additional paid-in capital 279,042 279,042 Retained earnings 268,309 252,953 Accumulated other comprehensive income 8 - -------------------- -------------------- Total common equity 580,786 565,422 -------------------- -------------------- Cumulative preferred stock 18,320 18,320 Long-term debt (excluding current portion) 469,708 551,079 -------------------- -------------------- 1,068,814 1,134,821 -------------------- -------------------- - ------------------------------------------------------------------------------------------------------------------------------- Current liabilities: Current maturities and sinking funds 81,560 51,196 Capital lease obligations 12,057 13,307 Notes payable to associated companies 77,004 56,946 Accounts payable 38,875 41,273 Accounts payable to associated companies 24,086 17,438 Accrued interest 12,928 10,833 Accrued taxes 63,452 44,259 Other 27,419 23,618 -------------------- -------------------- 337,381 258,870 -------------------- -------------------- - ------------------------------------------------------------------------------------------------------------------------------- Other long-term liabilities and deferred credits: Accumulated deferred income taxes 220,524 225,961 Accumulated deferred investment tax credits 25,699 26,682 Environmental liabilities 30,186 26,292 Pension and other benefit obligations 26,183 27,734 Capital lease obligations 17,284 25,977 Other 30,172 29,471 -------------------- -------------------- 350,048 362,117 -------------------- -------------------- - ------------------------------------------------------------------------------------------------------------------------------- Total capitalization and liabilities $1,756,243 $1,755,808 ==================== ==================== - ------------------------------------------------------------------------------------------------------------------------------- The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.
-17-
IES UTILITIES INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) For the Nine Months Ended September 30, 2000 1999 - ------------------------------------------------------------------------------------------------------------------------------------ (in thousands) Cash flows from operating activities: Net income $60,017 $56,979 Adjustments to reconcile net income to net cash flows from operating activities: Depreciation and amortization 80,555 76,444 Amortization of leased nuclear fuel 10,281 9,518 Amortization of deferred energy efficiency expenditures 10,611 12,668 Deferred taxes and investment tax credits (8,656) (7,417) Refueling outage provision 7,372 6,193 Gain on disposition of assets, net (1,517) - Other 1,661 877 Other changes in assets and liabilities: Accounts receivable (3,622) (4,102) Gas stored underground (12,357) 1,643 Accounts payable 4,250 (14,021) Accrued taxes 19,193 12,224 Adjustment clause balances 1,538 (15,009) Benefit obligations and other 6,293 14,580 ------------------- -------------------- Net cash flows from operating activities 175,619 150,577 ------------------- -------------------- - ------------------------------------------------------------------------------------------------------------------------------------ Cash flows used for financing activities: Common stock dividends declared (43,975) (73,292) Dividends payable (229) (4,840) Preferred stock dividends (686) (686) Reductions in long-term debt (51,196) (50,140) Net change in short-term borrowings 20,058 6,626 Principal payments under capital lease obligations (8,611) (9,461) Other - (19) ------------------- -------------------- Net cash flows used for financing activities (84,639) (131,812) ------------------- -------------------- - ------------------------------------------------------------------------------------------------------------------------------------ Cash flows used for investing activities: Utility construction expenditures (85,123) (66,753) Nuclear decommissioning trust funds (4,506) (4,506) Proceeds from disposition of assets 1,528 - Other (1,984) 35 ------------------- -------------------- Net cash flows used for investing activities (90,085) (71,224) ------------------- -------------------- - ------------------------------------------------------------------------------------------------------------------------------------ Net increase (decrease) in cash and temporary cash investments 895 (52,459) ------------------- -------------------- - ------------------------------------------------------------------------------------------------------------------------------------ Cash and temporary cash investments at beginning of period 5,720 57,904 ------------------- -------------------- - ------------------------------------------------------------------------------------------------------------------------------------ Cash and temporary cash investments at end of period $6,615 $5,445 =================== ==================== - ------------------------------------------------------------------------------------------------------------------------------------ Supplemental cash flow information: Cash paid during the period for: Interest $30,912 $34,825 =================== ==================== Income taxes $31,562 $41,052 =================== ==================== Noncash investing and financing activities - Capital lease obligations incurred $338 $23,793 =================== ==================== - ------------------------------------------------------------------------------------------------------------------------------------ The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.
-18- IES UTILITIES INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) Except as modified below, the Alliant Energy Notes to Consolidated Financial Statements are incorporated by reference insofar as they relate to IESU. 1. The interim consolidated financial statements included herein have been prepared by IESU, without audit, pursuant to the rules and regulations of the SEC. Accordingly, certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted, although management believes that the disclosures are adequate to make the information presented not misleading. IESU is a subsidiary of Alliant Energy. These financial statements should be read in conjunction with the financial statements and the notes thereto included in IESU's latest Annual Report on Form 10-K. In the opinion of management, all adjustments, which are normal and recurring in nature, necessary for a fair presentation of (a) the consolidated results of operations for the three and nine months ended September 30, 2000 and 1999, (b) the consolidated financial position at September 30, 2000 and December 31, 1999, and (c) the consolidated statement of cash flows for the nine months ended September 30, 2000 and 1999, have been made. Because of the seasonal nature of IESU's operations, results for the three and nine months ended September 30, 2000 are not necessarily indicative of results that may be expected for the year ending December 31, 2000. Certain prior period amounts have been reclassified on a basis consistent with the 2000 presentation. 2. IESU's comprehensive income, and the components of other comprehensive income, net of taxes, were as follows (in thousands):
For the Three Months Ended For the Nine Months September 30, Ended September 30, 2000 1999 2000 1999 ---------------------------------- --------------------------------- Earnings available for common stock $37,133 $35,249 $59,331 $56,293 Other comprehensive income: Unrealized gains (losses) on derivatives qualified as hedges: Unrealized holding gains arising during period due to cumulative effect of a change in accounting principle, net of tax 51 -- 51 -- Other unrealized holding losses arising during period, net of tax (43) -- (43) -- ---------------- -------------- -------------- -------------- Net unrealized gains on qualifying derivatives 8 -- 8 -- ---------------- -------------- -------------- -------------- Other comprehensive income 8 -- 8 -- ---------------- -------------- -------------- -------------- Comprehensive income $37,141 $35,249 $59,339 $56,293 ================ ============== ============== ==============
-19- 3. Certain financial information relating to IESU's significant business segments is presented below. Intersegment revenues were not material to IESU's operations.
Electric Gas Other Total ------------------------------------------------------------------ (in thousands) Three Months Ended September 30, 2000 ------------------------------------- Operating revenues $202,899 $20,893 $7,126 $230,918 Operating income (loss) 75,638 (854) 1,105 75,889 Earnings available for common stock 37,133 Three Months Ended September 30, 1999 ------------------------------------- Operating revenues $206,148 $16,648 $5,532 $228,328 Operating income (loss) 75,418 (2,760) (531) 72,127 Earnings available for common stock 35,249 Nine Months Ended September 30, 2000 ------------------------------------ Operating revenues $496,934 $107,767 $20,298 $624,999 Operating income 126,415 4,568 2,839 133,822 Earnings available for common stock 59,331 Nine Months Ended September 30, 1999 ------------------------------------ Operating revenues $488,374 $99,956 $20,056 $608,386 Operating income 124,558 5,292 2,505 132,355 Earnings available for common stock 56,293
-20-
WISCONSIN POWER AND LIGHT COMPANY CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED) For the Three Months For the Nine Months Ended September 30, Ended September 30, 2000 1999 2000 1999 - ------------------------------------------------------------------------------------------------------------------------------------ (in thousands) Operating revenues: Electric utility $183,088 $173,561 $518,575 $474,016 Gas utility 15,169 11,869 89,970 79,020 Water 1,378 1,360 3,787 3,860 ----------------- ------------------ ------------------ ----------------- 199,635 186,790 612,332 556,896 ----------------- ------------------ ------------------ ----------------- - ------------------------------------------------------------------------------------------------------------------------------------ Operating expenses: Electric production fuels 33,198 30,994 83,699 84,374 Purchased power 41,299 34,704 113,119 87,129 Cost of gas sold 6,431 2,636 51,398 39,614 Other operation and maintenance 41,855 46,050 142,039 130,470 Depreciation and amortization 32,655 32,446 97,631 91,992 Taxes other than income taxes 7,285 7,506 21,913 22,563 ----------------- ------------------ ------------------ ----------------- 162,723 154,336 509,799 456,142 ----------------- ------------------ ------------------ ----------------- - ------------------------------------------------------------------------------------------------------------------------------------ Operating income 36,912 32,454 102,533 100,754 ----------------- ------------------ ------------------ ----------------- - ------------------------------------------------------------------------------------------------------------------------------------ Interest expense and other: Interest expense 11,191 10,352 33,327 30,295 Allowance for funds used during construction (1,154) (1,279) (4,304) (3,311) Miscellaneous, net (1,117) 110 (7,549) (2,239) ----------------- ------------------ ------------------ ----------------- 8,920 9,183 21,474 24,745 ----------------- ------------------ ------------------ ----------------- - ------------------------------------------------------------------------------------------------------------------------------------ Income before income taxes 27,992 23,271 81,059 76,009 ----------------- ------------------ ------------------ ----------------- - ------------------------------------------------------------------------------------------------------------------------------------ Income taxes 10,445 9,082 30,343 28,579 ----------------- ------------------ ------------------ ----------------- - ------------------------------------------------------------------------------------------------------------------------------------ Net income 17,547 14,189 50,716 47,430 ----------------- ------------------ ------------------ ----------------- - ------------------------------------------------------------------------------------------------------------------------------------ Preferred dividend requirements 827 827 2,483 2,483 ----------------- ------------------ ------------------ ----------------- - ------------------------------------------------------------------------------------------------------------------------------------ Income before cumulative effect of a change in accounting principle 16,720 13,362 48,233 44,947 ----------------- ------------------ ------------------ ----------------- - ------------------------------------------------------------------------------------------------------------------------------------ Cumulative effect of a change in accounting principle, net of tax 35 - 35 - ----------------- ------------------ ------------------ ----------------- - ------------------------------------------------------------------------------------------------------------------------------------ Earnings available for common stock $16,755 $13,362 $48,268 $44,947 ================= ================== ================== ================= - ------------------------------------------------------------------------------------------------------------------------------------ The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.
-21-
WISCONSIN POWER AND LIGHT COMPANY CONSOLIDATED BALANCE SHEETS September 30, 2000 December 31, ASSETS (Unaudited) 1999 - ---------------------------------------------------------------------------------------------------------------------------------- (in thousands) Property, plant and equipment: Utility - Plant in service - Electric $1,991,341 $1,921,624 Gas 270,743 258,132 Water 29,331 27,770 Common 226,011 218,607 -------------------- -------------------- 2,517,426 2,426,133 Less - Accumulated depreciation 1,360,419 1,266,366 -------------------- -------------------- 1,157,007 1,159,767 Construction work in progress 58,101 66,784 Nuclear fuel, net of amortization 17,227 15,079 -------------------- -------------------- 1,232,335 1,241,630 Other property, plant and equipment, net of accumulated depreciation and amortization of $494 and $169, respectively 318 608 -------------------- -------------------- 1,232,653 1,242,238 -------------------- -------------------- - ---------------------------------------------------------------------------------------------------------------------------------- Current assets: Cash and temporary cash investments 5,836 3,555 Accounts receivable: Customer 22,008 22,061 Associated companies 1,986 5,067 Other 6,004 10,984 Production fuel, at average cost 17,521 20,663 Materials and supplies, at average cost 22,876 20,439 Gas stored underground, at average cost 16,613 8,624 Prepaid gross receipts tax 16,760 20,864 Other 7,784 9,275 -------------------- -------------------- 117,388 121,532 -------------------- -------------------- - ---------------------------------------------------------------------------------------------------------------------------------- Investments: Nuclear decommissioning trust funds 176,432 166,202 Other 14,406 15,272 -------------------- -------------------- 190,838 181,474 -------------------- -------------------- - ---------------------------------------------------------------------------------------------------------------------------------- Other assets: Regulatory assets 82,973 82,161 Deferred charges and other 161,336 138,730 -------------------- -------------------- 244,309 220,891 -------------------- -------------------- - ---------------------------------------------------------------------------------------------------------------------------------- Total assets $1,785,188 $1,766,135 ==================== ==================== - ---------------------------------------------------------------------------------------------------------------------------------- The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.
-22-
WISCONSIN POWER AND LIGHT COMPANY CONSOLIDATED BALANCE SHEETS (CONTINUED) September 30, 2000 December 31, CAPITALIZATION AND LIABILITIES (Unaudited) 1999 - ----------------------------------------------------------------------------------------------------------------------------------- (in thousands, except share amounts) Capitalization: Common stock - $5 par value - authorized 18,000,000 shares; 13,236,601 shares outstanding $66,183 $66,183 Additional paid-in capital 229,438 229,438 Retained earnings 351,743 303,476 Accumulated other comprehensive loss (1,321) - -------------------- -------------------- Total common equity 646,043 599,097 -------------------- -------------------- Cumulative preferred stock 59,963 59,963 Long-term debt (excluding current portion) 514,170 414,673 -------------------- -------------------- 1,220,176 1,073,733 -------------------- -------------------- - ----------------------------------------------------------------------------------------------------------------------------------- Current liabilities: Current maturities 1,875 1,875 Variable rate demand bonds 55,100 55,100 Notes payable to associated companies 25,560 125,749 Accounts payable 76,535 88,245 Accounts payable to associated companies 23,779 25,306 Other 36,417 30,283 -------------------- -------------------- 219,266 326,558 -------------------- -------------------- - ----------------------------------------------------------------------------------------------------------------------------------- Other long-term liabilities and deferred credits: Accumulated deferred income taxes 225,829 235,838 Accumulated deferred investment tax credits 29,932 31,311 Customer advances 33,816 34,643 Environmental liabilities 8,386 10,861 Other 47,783 53,191 -------------------- -------------------- 345,746 365,844 -------------------- -------------------- - ----------------------------------------------------------------------------------------------------------------------------------- Total capitalization and liabilities $1,785,188 $1,766,135 ==================== ==================== - ----------------------------------------------------------------------------------------------------------------------------------- The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.
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WISCONSIN POWER AND LIGHT COMPANY CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) For the Nine Months Ended September 30, 2000 1999 - ---------------------------------------------------------------------------------------------------------------------------------- (in thousands) Cash flows from operating activities: Net income $50,716 $47,430 Adjustments to reconcile net income to net cash flows from operating activities: Depreciation and amortization 97,631 91,992 Amortization of nuclear fuel 3,626 4,581 Deferred taxes and investment tax credits (9,614) (8,962) Other (8,666) (2,119) Other changes in assets and liabilities: Accounts receivable 8,114 7,721 Production fuel 3,142 3,608 Gas stored underground (7,989) (679) Prepaid gross receipts tax 4,104 5,650 Accounts payable (13,237) (10,616) Benefit obligations and other (1,287) (6,611) ------------------------ ------------------------ Net cash flows from operating activities 126,540 131,995 ------------------------ ------------------------ - ---------------------------------------------------------------------------------------------------------------------------------- Cash flows used for financing activities: Common stock dividends - (43,765) Preferred stock dividends (2,483) (2,483) Proceeds from issuance of long-term debt 100,000 - Net change in short-term borrowings (100,189) 346 Capital contribution from parent - 30,000 Other (1,319) - ------------------------ ------------------------ Net cash flows used for financing activities (3,991) (15,902) ------------------------ ------------------------ - ---------------------------------------------------------------------------------------------------------------------------------- Cash flows used for investing activities: Utility construction expenditures (92,521) (88,421) Nuclear decommissioning trust funds (15,373) (15,373) Shared savings program (14,698) (11,880) Other 2,324 743 ------------------------ ------------------------ Net cash flows used for investing activities (120,268) (114,931) ------------------------ ------------------------ - ---------------------------------------------------------------------------------------------------------------------------------- Net increase in cash and temporary cash investments 2,281 1,162 ------------------------ ------------------------ - ---------------------------------------------------------------------------------------------------------------------------------- Cash and temporary cash investments at beginning of period 3,555 1,811 ------------------------ ------------------------ - ---------------------------------------------------------------------------------------------------------------------------------- Cash and temporary cash investments at end of period $5,836 $2,973 ======================== ======================== - ---------------------------------------------------------------------------------------------------------------------------------- Supplemental cash flow information: Cash paid during the period for: Interest $30,087 $27,614 ======================== ======================== Income taxes $35,686 $40,686 ======================== ======================== - ---------------------------------------------------------------------------------------------------------------------------------- The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.
-24- WISCONSIN POWER AND LIGHT COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) Except as modified below, the Alliant Energy Notes to Consolidated Financial Statements are incorporated by reference insofar as they relate to WP&L. 1. The interim consolidated financial statements included herein have been prepared by WP&L, without audit, pursuant to the rules and regulations of the SEC. Accordingly, certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted, although management believes that the disclosures are adequate to make the information presented not misleading. The consolidated financial statements include WP&L and its consolidated subsidiary, South Beloit. WP&L is a subsidiary of Alliant Energy. These financial statements should be read in conjunction with the financial statements and the notes thereto included in WP&L's latest Annual Report on Form 10-K. In the opinion of management, all adjustments, which are normal and recurring in nature, necessary for a fair presentation of (a) the consolidated results of operations for the three and nine months ended September 30, 2000 and 1999, (b) the consolidated financial position at September 30, 2000 and December 31, 1999, and (c) the consolidated statement of cash flows for the nine months ended September 30, 2000 and 1999, have been made. Because of the seasonal nature of WP&L's operations, results for the three and nine months ended September 30, 2000 are not necessarily indicative of results that may be expected for the year ending December 31, 2000. Certain prior period amounts have been reclassified on a basis consistent with the 2000 presentation. 2. WP&L's comprehensive income, and the components of other comprehensive loss, net of taxes, were as follows (in thousands):
For the Three Months Ended For the Nine Months September 30, Ended September 30, 2000 1999 2000 1999 ---------------- -- -------------- -------------- -- ------------ Earnings available for common stock $16,755 $13,362 $48,268 $44,947 Other comprehensive loss: Unrealized losses on derivatives qualified as hedges: Unrealized holding losses arising during period due to cumulative effect of a change in accounting principle, net of tax (642) -- (642) -- Other unrealized holding losses arising during period, net of tax (747) -- (747) -- Less: reclassification adjustment for losses included in net income, net tax 68 -- 68 -- -------------- -------------- -------------- -------------- Net unrealized losses on qualifying derivatives (1,321) -- (1,321) -- -------------- -------------- -------------- -------------- Other comprehensive loss (1,321) -- (1,321) -- -------------- -------------- -------------- -------------- Comprehensive income $15,434 $13,362 $46,947 $44,947 ============== ============== ============== ==============
-25- 3. Certain financial information relating to WP&L's significant business segments is presented below. Intersegment revenues were not material to WP&L's operations.
Electric Gas Other Total ------------------------------------------------------------------ (in thousands) Three Months Ended September 30, 2000 ------------------------------------- Operating revenues $183,088 $15,169 $1,378 $199,635 Operating income (loss) 38,436 (2,032) 508 36,912 Earnings available for common stock 16,755 Three Months Ended September 30, 1999 ------------------------------------- Operating revenues $173,561 $11,869 $1,360 $186,790 Operating income (loss) 33,857 (1,863) 460 32,454 Earnings available for common stock 13,362 Nine Months Ended September 30, 2000 ------------------------------------ Operating revenues $518,575 $89,970 $3,787 $612,332 Operating income 95,232 6,007 1,294 102,533 Earnings available for common stock 48,268 Nine Months Ended September 30, 1999 ------------------------------------ Operating revenues $474,016 $79,020 $3,860 $556,896 Operating income 91,746 7,702 1,306 100,754 Earnings available for common stock 44,947
-26- ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS The primary first tier subsidiaries of Alliant Energy include: WP&L, IESU, IPC, Resources and Corporate Services. Among various other regulatory constraints, Alliant Energy is operating as a registered public utility holding company subject to the limitations imposed by PUHCA. This MD&A includes information relating to Alliant Energy, IESU and WP&L (as well as IPC, Resources and Corporate Services). Where appropriate, information relating to a specific entity has been segregated and labeled as such. The following discussion and analysis should be read in conjunction with the Consolidated Financial Statements and Notes to Consolidated Financial Statements included in this report as well as the financial statements, notes and MD&A included in Alliant Energy's, IESU's and WP&L's latest Annual Report on Form 10-K. FORWARD-LOOKING STATEMENTS Statements contained in this report (including MD&A) that are not of historical fact are forward-looking statements intended to qualify for the safe harbors from liability established by the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those expressed in, or implied by, such statements. Some, but not all, of the risks and uncertainties include weather effects on sales and revenues, competitive factors, general economic conditions in the relevant service territory, federal and state regulatory or government actions, including issues associated with the deregulation of the utility industry and the setting of rates, unanticipated construction and acquisition expenditures, issues related to stranded costs and the recovery thereof, the operations of Alliant Energy's nuclear facilities, unanticipated costs associated with certain environmental remediation efforts being undertaken by Alliant Energy, Alliant Energy's ability to successfully implement its growth strategy, including the acquisition and operation of foreign companies, unanticipated issues relating to establishing a transmission company, material changes in the value of Alliant Energy's investments in McLeod and Capstone, technological developments, employee workforce factors, including changes in key executives, collective bargaining agreements or work stoppages, political, legal, economic and exchange rate conditions in foreign countries Alliant Energy has investments in and changes in the rate of inflation. UTILITY INDUSTRY OUTLOOK A summary of the current regulatory environment is included in the Form 10-K filed by Alliant Energy, IESU and WP&L for the year ended December 31, 1999. Set forth below are several developments relating to such regulatory environment. Across the nation, approximately half of the states (including Illinois) have passed legislation or issued regulatory rulings granting customers the right to choose their electric energy supplier. Legislation that would allow customers to choose their electric energy supplier was introduced in Iowa in 2000 but was never voted upon. At the federal level, a number of proposals to restructure the electric industry are currently under consideration. However, there continues to be a lack of consensus over how restructuring should be implemented and how much control the federal government should have over this process. Until one of the proposals gains significant bipartisan support, Alliant Energy believes there is unlikely to be final federal action to either facilitate or force states to open electricity markets to competition. "Reliability 2000" legislation was enacted in Wisconsin in 1999. This legislation included, among other items, the formation of a Wisconsin transmission company for those Wisconsin utility holding companies who elect to take advantage of the asset cap law and others who elect to join. WP&L currently expects to transfer its transmission assets to the transmission company (American Transmission Company, or ATC) on January 1, 2001 and it is expected that the net book value of such assets (approximately $170 million) will become the new carrying value of its investment in ATC, resulting in no gain or loss for WP&L. In July 2000, the PSCW issued a ruling indicating that facilities with voltages of 50 kV and above are considered transmission facilities for purposes of transferring assets to ATC. At this time, Alliant Energy has decided not to contribute IESU's and IPC's transmission assets to ATC. Refer to Part II, Item 1, "Legal Proceedings" for information regarding a federal lawsuit challenging certain provisions of WUHCA. -27- WP&L does not expect this transfer to result in a significant impact on its financial condition or results of operations because it believes FERC will allow WP&L to earn a return on the contributed assets comparable to the return currently allowed by the PSCW and FERC. WP&L's ownership percentage will be approximately 23% and WP&L will account for its investment in ATC under the equity method. Although no assurance can be given, it is currently anticipated that ATC's dividend policy will support a return of a significant portion of these earnings to the participants. ATC will realize its revenues from the provision of transmission services to both participants in ATC as well as nonparticipants. ATC is currently expected to begin operations on January 1, 2001. In December 1999, FERC issued Order 2000 which outlines requirements for utilities to voluntarily turn over operational control of their transmission system to a regional entity. FERC's timeline is to have the RTOs in operation by the end of 2001. Alliant Energy's current plans to contribute its Wisconsin transmission assets to ATC, in exchange for an equity interest, and to participate in the Midwest ISO are expected to comply with the provisions of Order 2000. In March 2000, FERC approved Alliant Energy's membership in the Midwest ISO as well as WP&L's transfer of its transmission assets to ATC. In September 2000, FERC approved the transfer of South Beloit's (WP&L's wholly-owned subsidiary) electric transmission facilities to ATC. Alliant Energy is reviewing, with several other utilities, the viability of developing an Independent Transmission Company for various Midwest utilities not included in the ATC, including IESU and IPC. The present schedule is to develop a business plan and if it is deemed acceptable by the applicable parties, to make the necessary filings with FERC and the various states by mid-2001. Alliant Energy complies with the provisions of SFAS 71, "Accounting for the Effects of Certain Types of Regulation." SFAS 71 provides that rate-regulated public utilities record certain costs and credits allowed in the rate making process in different periods than for non-regulated entities. These are deferred as regulatory assets or regulatory liabilities and are recognized in the consolidated statements of income at the time they are reflected in rates. If a portion of the utility's operations becomes no longer subject to the provisions of SFAS 71 as a result of competitive restructurings or otherwise, a write-down of related regulatory assets and possibly other charges would be required, unless some form of transition cost recovery is established by the appropriate regulatory body that would meet the requirements under generally accepted accounting principles for continued accounting as regulatory assets during such recovery period. In addition, each utility would be required to determine any impairment of other assets and write-down any impaired assets to their fair value. Alliant Energy believes that its utility subsidiaries currently meet the requirements of SFAS 71. ALLIANT ENERGY RESULTS OF OPERATIONS Unless otherwise noted, all "per share" references in the Alliant Energy Results of Operations section refer to earnings per diluted share. Overview - Third Quarter Results - Alliant Energy reported net income of - -------------------------------- $276.2 million, or $3.49 per share, for the third quarter of 2000, compared to $71.5 million, or $0.91 per share, for the third quarter of 1999. Third quarter 2000 earnings included $204 million of net income, or $2.58 per share, relating to Alliant Energy's adoption of a new accounting pronouncement, SFAS 133, on July 1, 2000. Excluding such income, third quarter 2000 earnings were $0.91 per share, which was the same as the prior year. Earnings in the third quarter benefited from lower utility operation and maintenance expenses and increased earnings from Alliant Energy's oil and gas business. Such items were offset by increased interest expense to fund Alliant Energy's strategic growth initiatives, a decrease in electric utility margin and lower gains from asset sales in New Zealand. -28- Third quarter 2000 utility earnings were $68.4 million ($0.86 per share) compared to $62.8 million ($0.80 per share) for the same period in 1999. The increase resulted primarily from lower operation and maintenance expenses ($0.11 per share) partially offset by a decrease in electric utility margin ($0.05 per share). Resources reported net income of $208.0 million ($2.63 per share) in the third quarter of 2000, including the $204 million related to the adoption of SFAS 133. Net income for the third quarter of 1999 was $7.4 million ($0.09 per share). Excluding SFAS 133 income, earnings were $4.0 million ($0.05 per share) in the third quarter of 2000. The lower earnings for Resources, excluding the impact of SFAS 133, were due to higher interest expense ($0.07 per share) to fund Alliant Energy's strategic growth initiatives, a one-time charge ($0.03 per share) related to a loss on a contract at Alliant Energy's industrial services business and lower gains ($0.03 per share) from sales of certain investments in New Zealand completed during both quarters. Third quarter 2000 earnings benefited from higher earnings from Alliant Energy's oil and gas operations ($0.05 per share) and improved operations from the remainder of Alliant Energy's non-regulated businesses ($0.04 per share). Electric Utility Operations - Electric margins and MWH sales for Alliant - --------------------------- Energy for the three months ended September 30 were as follows:
Revenues and Costs MWHs Sold (in thousands) (in thousands) ---------------------------------- -------------------------------- 2000 1999 Change 2000 1999 Change ----------------- --------------- ----------- --------------- --------------- ----------- Residential $171,160 $169,507 1% 2,059 2,076 (1%) Commercial 102,705 103,111 -- 1,467 1,511 (3%) Industrial 140,647 139,984 -- 3,320 3,435 (3%) ----------------- --------------- --------------- --------------- Total from ultimate customers 414,512 412,602 -- 6,846 7,022 (3%) Sales for resale 52,452 49,158 7% 1,253 1,500 (16%) Other 13,799 13,663 1% 40 41 (2%) ----------------- --------------- --------------- --------------- Total revenues/sales 480,763 475,423 1% 8,139 8,563 (5%) =============== =============== Electric production fuels expense 76,432 76,629 -- Purchased power expense 85,553 74,802 14% ----------------- --------------- Margin $318,778 $323,992 (2%) ================= ===============
Electric margins and MWH sales for Alliant Energy for the nine months ended September 30 were as follows:
Revenues and Costs MWHs Sold (in thousands) (in thousands) --------------------------------- -------------------------------- 2000 1999 Change 2000 1999 Change ---------------- --------------- ----------- --------------- --------------- ----------- Residential $434,100 $423,166 3% 5,416 5,461 (1%) Commercial 264,229 252,668 5% 4,004 4,005 -- Industrial 379,400 359,365 6% 9,807 9,749 1% ---------------- --------------- --------------- --------------- Total from ultimate customers 1,077,729 1,035,199 4% 19,227 19,215 -- Sales for resale 130,063 122,736 6% 3,618 4,184 (14%) Other 40,436 34,978 16% 129 123 5% ---------------- --------------- --------------- --------------- Total revenues/sales 1,248,228 1,192,913 5% 22,974 23,522 (2%) =============== =============== Electric production fuels expense 202,145 187,765 8% Purchased power expense 222,690 199,308 12% ---------------- --------------- Margin $823,393 $805,840 2% ================ ===============
Electric margin decreased $5.2 million, or 2%, and increased $17.6 million, or 2%, for the three and nine months ended September 30, 2000, respectively, compared with the same periods in 1999. The three-month decrease stemmed from milder weather conditions in the third quarter of 2000 and a change in -29- estimate of Alliant Energy's utility services rendered but unbilled at month-end, which had a favorable impact of approximately $9 million in the third quarter of 1999. Third quarter earnings benefited by continued economic growth in Alliant Energy's utility service territory and increased capacity sales. The nine-month increase was primarily due to the following factors: (a) Economic growth in Alliant Energy's service territory. (b) Increased capacity sales. (c) Increased revenues from WP&L's conservation programs. (d) A $15 million annual rate recovery adjustment implemented in March 1999 at WP&L to recover higher purchased-power and transmission costs. (e) Changes in estimates of utility services rendered but unbilled at month-end of approximately $10 million in Wisconsin in 2000, partially offset by approximately $9 million in Iowa in 1999. These items were partially offset by milder weather conditions in 2000 and higher purchased-power and transmission costs in the first four months of 2000 at WP&L. Rate recovery of WP&L's higher purchased-power and transmission costs did not begin until May 2000. IESU's and IPC's electric tariffs include EAC's that are designed to currently recover the costs of fuel and the energy portion of purchased-power billings. Gas Utility Operations - Gas margins and Dth sales for Alliant Energy for the - ---------------------- three months ended September 30 were as follows:
Revenues and Costs Dekatherms Sold (in thousands) (in thousands) ---------------------------------- ------------------------------- 2000 1999 Change 2000 1999 Change ----------------- --------------- ----------- -------------- --------------- ----------- Residential $21,662 $17,774 22% 2,153 2,178 (1%) Commercial 12,512 8,888 41% 1,761 1,582 11% Industrial 5,273 4,526 17% 1,009 1,228 (18%) Transportation/other 1,922 2,285 (16%) 9,409 10,192 (8%) ----------------- --------------- -------------- --------------- Total revenues/sales 41,369 33,473 24% 14,332 15,180 (6%) ============== =============== Cost of gas sold 22,660 14,458 57% ----------------- --------------- Margin $18,709 $19,015 (2%) ================= ===============
Gas margins and Dth sales for Alliant Energy for the nine months ended September 30 were as follows:
Revenues and Costs Dekatherms Sold (in thousands) (in thousands) ---------------------------------- ------------------------------- 2000 1999 Change 2000 1999 Change ----------------- --------------- ----------- -------------- --------------- ----------- Residential $133,870 $126,815 6% 19,580 20,983 (7%) Commercial 67,548 60,542 12% 12,194 12,673 (4%) Industrial 15,823 14,942 6% 3,595 4,185 (14%) Transportation/other 8,915 11,058 (19%) 31,411 35,635 (12%) ----------------- --------------- -------------- --------------- Total revenues/sales 226,156 213,357 6% 66,780 73,476 (9%) ============== =============== Cost of gas sold 136,642 118,468 15% ----------------- --------------- Margin $89,514 $94,889 (6%) ================= ===============
Gas margin decreased $0.3 million, or 2%, and $5.4 million, or 6%, for the three and nine months ended September 30, 2000, respectively, compared with the same periods in 1999, primarily due to the decline in sales resulting from milder weather. -30- IESU's and IPC's gas tariffs include PGA clauses that are designed to currently recover the cost of utility gas sold. Non-regulated and Other Revenues - Non-regulated and other revenues for the - -------------------------------- three and nine months ended September 30, 2000 were as follows (in thousands):
For the Three Months For the Nine Months Ended September 30, Ended September 30, 2000 1999 2000 1999 -------------- ---------------- ---------------- --------------- ISCO $87,276 $52,213 $247,126 $119,113 Oil and gas (Whiting) 29,412 18,661 75,212 48,102 Steam 7,459 5,804 21,335 20,959 Transportation 5,202 5,772 15,207 16,214 Other 6,941 6,990 18,573 20,647 -------------- ---------------- ---------------- --------------- $136,290 $89,440 $377,453 $225,035 ============== ================ ================ ===============
Non-regulated and other revenues increased $46.9 million and $152.4 million for the three and nine months ended September 30, 2000, respectively, compared with the same periods in 1999, primarily due to increased revenues at ISCO related to the 1999 acquisition of an oil gathering and transportation business in Texas and increased oil and gas revenues at Whiting due to higher oil and gas prices and oil volumes. The nine-month decrease was partially offset by reduced gas volumes. Other Operating Expenses - Other operation and maintenance expenses for the - ------------------------ three and nine months ended September 30, 2000 were as follows (in thousands):
For the Three Months For the Nine Months Ended September 30, Ended September 30, 2000 1999 2000 1999 -------------- ---------------- ---------------- --------------- Utility - IESU / WP&L / IPC $108,291 $122,499 $367,497 $362,338 ISCO 95,097 54,536 252,083 115,191 Oil and gas (Whiting) 9,823 7,966 26,555 22,625 Transportation 2,806 2,309 8,363 7,150 Other 7,735 9,334 22,762 23,743 -------------- ---------------- ---------------- --------------- $223,752 $196,644 $677,260 $531,047 ============== ================ ================ ===============
Other operation and maintenance expenses at the utility subsidiaries decreased $14.2 million and increased $5.2 million for the three and nine months ended September 30, 2000, respectively, compared with the same periods in 1999. The three-month decrease was primarily due to lower operating expenses at Alliant Energy's transmission and distribution and generation business units as well as reduced administrative and general expenses. The nine-month increase was primarily due to a planned second quarter 2000 refueling outage at Kewaunee, $3 million of one-time fees related to the transfer of the Iowa utility businesses from the MAPP reliability region to the MAIN region and increased energy conservation expense at WP&L. Such increases were partially offset by reduced administrative and general expenses and lower employee benefit costs. Expenses incurred in 1999 relating to Alliant Energy's Year 2000 readiness program also impacted the comparisons. Other operation and maintenance expenses at ISCO increased $40.6 million and $136.9 million for the three and nine months ended September 30, 2000, respectively, compared with the same periods in 1999, primarily due to expenses associated with the acquisition of the oil gathering and transportation business and increased operating expenses at Alliant Energy's environmental and engineering services business, including a one-time charge of $4 million related to a loss on a contract. -31- Depreciation and amortization expense increased $5.1 million and $14.9 million for the three and nine months ended September 30, 2000, respectively, compared with the same periods in 1999, primarily due to utility property additions and acquisitions at the non-regulated businesses, increased earnings in the WP&L nuclear decommissioning trust fund (offset entirely in "Miscellaneous, net") and increased amortization expenses. Interest Expense and Other - Interest expense increased $12.8 million and - -------------------------- $27.1 million for the three and nine months ended September 30, 2000, respectively, compared with the same periods in 1999, primarily due to higher non-regulated and utility borrowings to fund Alliant Energy's strategic growth initiatives, including Resources' $347 million investment in several Brazilian electric utilities in January 2000. On July 1, 2000, Alliant Energy adopted SFAS 133. Related to the adoption, Alliant Energy recorded a $321.3 million gain related to the designation of a portion of Alliant Energy's McLeod holdings as "trading securities." This gain related to the unrealized appreciation in value of approximately 27% of Alliant Energy's McLeod holdings. Alliant Energy will reflect in earnings all future changes in the value of the shares of McLeod stock designated as trading, which is expected to substantially offset the earnings impact of corresponding changes in the value of the derivative component of the 30-year exchangeable senior notes issued by Resources in February 2000. Alliant Energy sold 450,000 shares (as adjusted for the 3-for-1 stock split effective April 2000) of its investment in McLeod in the first quarter of 2000, resulting in a pre-tax gain of $10.2 million. Alliant Energy sold approximately 3,840,000 shares (as adjusted for the 2-for-1 stock split effective July 1999 and the 3-for-1 stock split effective April 2000) of its investment in McLeod in the second quarter of 1999, resulting in a pre-tax gain of $33.8 million. Miscellaneous, net income increased $2.6 million and $15.0 million for the three and nine months ended September 30, 2000, respectively, compared with the same periods in 1999, primarily due to a change in the value of the derivative component of Resources' exchangeable senior notes derivative, increased interest income (including $4 million recognized in the first quarter of 2000 from a tax settlement at IESU), increased earnings from Alliant Energy's electricity trading business, increased equity income from Alliant Energy's other unconsolidated investments, gains on sales of various investments and increased nuclear decommissioning trust fund earnings. Increases for both periods were partially offset by the decrease in value of the McLeod trading securities and lower gains from sales of certain investments in New Zealand completed during both periods. Refer to Note 10 of Alliant Energy's Notes to Consolidated Financial Statements for additional information related to the exchangeable senior notes derivative and the McLeod trading securities. Income Taxes - Income tax expense increased $132.8 million and $122.3 million - ------------ for the three and nine months ended September 30, 2000, respectively, compared with the same periods in 1999, primarily due to changes in taxable income and higher effective income tax rates. The effective income tax rates were 40.2% and 39.6%, for the three and nine months ended September 30, 2000, compared with 36.8% and 36.9%, respectively, for the same periods last year. The higher rates in 2000 were due to the impact of the adoption of SFAS 133. Cumulative effective of a change in accounting principle - Refer to Note 10 - -------------------------------------------------------- of Alliant Energy's Notes to Consolidated Financial Statements. IESU RESULTS OF OPERATIONS Overview - Third Quarter Results - IESU's earnings available for common stock - -------------------------------- increased $1.9 million for the three months ended September 30, 2000, compared with the same period in 1999, primarily due to reduced other operation and maintenance expenses, partially offset by a lower electric margin. -32- Electric Utility Operations - Electric margins and MWH sales for IESU for the - --------------------------- three months ended September 30 were as follows:
Revenues and Costs MWHs Sold (in thousands) (in thousands) --------------------------------- ------------------------------- 2000 1999 Change 2000 1999 Change ---------------- --------------- ----------- -------------- --------------- ----------- Residential $78,004 $76,739 2% 822 818 -- Commercial 56,326 58,716 (4%) 732 781 (6%) Industrial 55,517 56,796 (2%) 1,239 1,312 (6%) ---------------- --------------- -------------- --------------- Total from ultimate customers 189,847 192,251 (1%) 2,793 2,911 (4%) Sales for resale 9,378 10,373 (10%) 247 385 (36%) Other 3,674 3,524 4% 10 9 11% ---------------- --------------- -------------- --------------- Total revenues/sales 202,899 206,148 (2%) 3,050 3,305 (8%) ============== =============== Electric production fuels expense 22,633 27,442 (18%) Purchased power expense 28,324 22,057 28% ---------------- --------------- Margin $151,942 $156,649 (3%) ================ ===============
Electric margins and MWH sales for IESU for the nine months ended September 30 were as follows:
Revenues and Costs MWHs Sold (in thousands) (in thousands) ---------------------------------- ------------------------------- 2000 1999 Change 2000 1999 Change ----------------- --------------- ----------- -------------- --------------- ----------- Residential $183,138 $182,318 -- 2,088 2,106 (1%) Commercial 138,335 136,148 2% 2,008 2,027 (1%) Industrial 143,743 137,889 4% 3,754 3,786 (1%) ----------------- --------------- -------------- --------------- Total from ultimate customers 465,216 456,355 2% 7,850 7,919 (1%) Sales for resale 21,875 23,108 (5%) 748 1,068 (30%) Other 9,843 8,911 10% 30 29 3% ----------------- --------------- -------------- --------------- Total revenues/sales 496,934 488,374 2% 8,628 9,016 (4%) ============== =============== Electric production fuels expense 76,595 58,689 31% Purchased power expense 59,464 62,349 (5%) ----------------- --------------- Margin $360,875 $367,336 (2%) ================= ===============
Electric margin decreased $4.7 million, or 3%, and $6.5 million, or 2%, for the three and nine months ended September 30, 2000, respectively, compared with the same periods in 1999, primarily due to milder weather conditions in 2000 and a change in estimate recorded in 1999 of IESU's utility services rendered but unbilled at month-end of approximately $5 million. Also contributing to the nine-month decrease were reduced recoveries of approximately $4.8 million in concurrent and previously deferred expenditures for Iowa-mandated energy efficiency programs. The recovery for energy efficiency programs in Iowa is in accordance with IUB orders (a portion of these recoveries is offset as they are also amortized to expense in other operation and maintenance expense). Increased sales due to economic growth in IESU's service territory partially offset the decreased margin each period. IESU's electric tariffs include EAC's that are designed to currently recover the costs of fuel and the energy portion of purchased-power billings. -33- Gas Utility Operations - Gas margins and Dth sales for IESU for the three - ---------------------- months ended September 30 were as follows:
Revenues and Costs Dekatherms Sold (in thousands) (in thousands) ---------------------------------- ------------------------------- 2000 1999 Change 2000 1999 Change ----------------- --------------- ----------- -------------- --------------- ----------- Residential $10,406 $8,913 17% 908 988 (8%) Commercial 5,788 3,787 53% 744 608 22% Industrial 3,840 2,988 29% 740 820 (10%) Transportation/other 859 960 (11%) 2,091 2,250 (7%) ----------------- --------------- -------------- --------------- Total revenues/sales 20,893 16,648 25% 4,483 4,666 (4%) ============== =============== Cost of gas sold 13,253 8,777 51% ----------------- --------------- Margin $7,640 $7,871 (3%) ================= ===============
Gas margins and Dth sales for IESU for the nine months ended September 30 were as follows:
Revenues and Costs Dekatherms Sold (in thousands) (in thousands) ---------------------------------- ------------------------------- 2000 1999 Change 2000 1999 Change ----------------- --------------- ----------- -------------- --------------- ----------- Residential $64,262 $61,108 5% 9,011 9,626 (6%) Commercial 31,107 27,725 12% 5,433 5,643 (4%) Industrial 9,128 7,824 17% 2,122 2,298 (8%) Transportation/other 3,270 3,299 (1%) 7,194 7,712 (7%) ----------------- --------------- -------------- --------------- Total revenues/sales 107,767 99,956 8% 23,760 25,279 (6%) ============== =============== Cost of gas sold 68,291 58,313 17% ----------------- --------------- Margin $39,476 $41,643 (5%) ================= ===============
Gas margin decreased $0.2 million, or 3%, and $2.2 million, or 5%, for the three and nine months ended September 30, 2000, respectively, compared with the same periods in 1999. The nine-month decrease was primarily due to reduced natural gas sales due to milder weather. IESU's gas tariffs include PGA clauses that are designed to currently recover the cost of gas sold. Other Operating Expenses - IESU's other operation and maintenance expenses - ------------------------ decreased $8.2 million and $12.6 million for the three and nine months ended September 30, 2000, respectively, compared with the same periods in 1999. The three-month decrease was primarily due to reduced administrative and general expenses and lower transmission and distribution expenses. The nine-month decrease was primarily due to a decrease of $4.2 million in energy efficiency expenses, reduced administrative and general expenses, lower employee benefits costs and lower transmission and distribution expenses. Partially offsetting the nine-month decrease were one-time fees related to the transfer from the MAAP reliability region to the MAIN region. Expenses incurred in 1999 relating to IESU's Year 2000 readiness program also impacted the comparisons. IESU's depreciation and amortization expense increased $1.4 million and $4.1 million for the three and nine months ended September 30, 2000, respectively, compared with the same periods in 1999, primarily due to property additions. Interest Expense and Other - Miscellaneous, net income decreased $0.5 million - -------------------------- and increased $2.3 million for the three and nine months ended September 30, 2000, respectively, compared with the same periods in 1999. The nine-month increase was primarily due to $4.1 million of interest income recognized from a tax settlement in the first quarter of 2000, partially offset by a decrease in nuclear decommissioning trust fund earnings. -34- Income Taxes - IESU's income tax expense increased $0.9 million and $1.9 - ------------ million for the three and nine months ended September 30, 2000, respectively, compared with the same periods last year, primarily due to increased taxable income. The effective income tax rates were 41.4% and 41.9% for the three and nine months ended September 30, 2000, respectively, compared with 41.8% and 42.1%, respectively, for the same periods last year. WP&L RESULTS OF OPERATIONS Overview - Third Quarter Results - WP&L's earnings available for common stock - --------- increased $3.4 million for the three months ended September 30, 2000, compared with the same period in 1999. The increased earnings were primarily due to reduced other operation and maintenance expenses, largely due to expenses incurred in 1999 for WP&L's Year 2000 readiness program. Electric Utility Operations - Electric margins and MWH sales for WP&L for the - --------------------------- three months ended September 30 were as follows:
Revenues and Costs MWHs Sold (in thousands) (in thousands) ---------------------------------- ------------------------------- 2000 1999 Change 2000 1999 Change ----------------- --------------- ----------- -------------- --------------- ----------- Residential $61,816 $60,399 2% 872 885 (1%) Commercial 34,228 32,028 7% 563 543 4% Industrial 48,801 44,732 9% 1,201 1,186 1% ----------------- --------------- -------------- --------------- Total from ultimate customers 144,845 137,159 6% 2,636 2,614 1% Sales for resale 32,084 30,769 4% 838 879 (5%) Other 6,159 5,633 9% 13 14 (7%) ----------------- --------------- -------------- --------------- Total revenues/sales 183,088 173,561 5% 3,487 3,507 (1%) ============== =============== Electric production fuels expense 33,198 30,994 7% Purchased power expense 41,299 34,704 19% ----------------- --------------- Margin $108,591 $107,863 1% ================= ===============
Electric margins and MWH sales for WP&L for the nine months ended September 30 were as follows:
Revenues and Costs MWHs Sold (in thousands) (in thousands) --------------------------------- ------------------------------- 2000 1999 Change 2000 1999 Change ---------------- --------------- ----------- -------------- --------------- ----------- Residential $173,925 $163,948 6% 2,379 2,403 (1%) Commercial 96,163 88,489 9% 1,529 1,502 2% Industrial 142,134 126,211 13% 3,533 3,387 4% ---------------- --------------- -------------- --------------- Total from ultimate customers 412,222 378,648 9% 7,441 7,292 2% Sales for resale 86,102 79,635 8% 2,400 2,454 (2%) Other 20,251 15,733 29% 48 43 12% ---------------- --------------- -------------- --------------- Total revenues/sales 518,575 474,016 9% 9,889 9,789 1% ============== =============== Electric production fuels expense 83,699 84,374 (1%) Purchased power expense 113,119 87,129 30% ---------------- --------------- Margin $321,757 $302,513 6% ================ ===============
Electric margin increased $0.7 million, or 1%, and $19.2 million, or 6%, for the three and nine months ended September 30, 2000, respectively, compared with the same periods in 1999. The three-month increase was primarily due to increased sales to retail customers due to economic growth in the service territory, largely offset by milder weather conditions in the third quarter of 2000. -35- The nine-month increase was primarily due to the following factors: (a) The favorable impact of approximately $10 million due to a change in estimate recorded in the second quarter of 2000 of WP&L's utility services rendered but unbilled at month-end. (b) A $15 million rate recovery adjustment implemented in March 1999 to recover higher purchased-power and transmission costs. (c) Increased revenues from conservation programs. (d) Increased sales to retail customers due to economic growth in the service territory. These items were partially offset by milder weather conditions in 2000 and higher purchased-power and transmission costs in the first four months of 2000. Rate recovery of the higher purchased-power and transmission costs did not begin until May 2000. Gas Utility Operations - Gas margins and Dth sales for WP&L for the three - ---------------------- months ended September 30 were as follows:
Revenues and Costs Dekatherms Sold (in thousands) (in thousands) ---------------------------------- ------------------------------- 2000 1999 Change 2000 1999 Change ----------------- --------------- ----------- -------------- --------------- ----------- Residential $8,312 $6,459 29% 939 852 10% Commercial 5,604 4,128 36% 854 769 11% Industrial 872 694 26% 144 171 (16%) Transportation/other 381 588 (35%) 2,772 2,804 (1%) ----------------- --------------- -------------- --------------- Total revenues/sales 15,169 11,869 28% 4,709 4,596 2% ============== =============== Cost of gas sold 6,431 2,636 144% ----------------- --------------- Margin $8,738 $9,233 (5%) ================= ===============
Gas margins and Dth sales for WP&L for the nine months ended September 30 were as follows:
Revenues and Costs Dekatherms Sold (in thousands) (in thousands) ---------------------------------- ------------------------------- 2000 1999 Change 2000 1999 Change ----------------- --------------- ----------- -------------- --------------- ----------- Residential $52,795 $46,389 14% 7,926 8,179 (3%) Commercial 28,830 23,518 23% 5,321 5,253 1% Industrial 4,510 3,860 17% 923 1,008 (8%) Transportation/other 3,835 5,253 (27%) 9,613 9,542 1% ----------------- --------------- -------------- --------------- Total revenues/sales 89,970 79,020 14% 23,783 23,982 (1%) ============== =============== Cost of gas sold 51,398 39,614 30% ----------------- --------------- Margin $38,572 $39,406 (2%) ================= ===============
Gas margin decreased $0.5 million, or 5%, and $0.8 million, or 2%, for the three and nine months ended September 30, 2000, respectively, compared with the same periods in 1999. Other Operating Expenses - Other operation and maintenance expenses decreased - ------------------------ $4.2 million and increased $11.6 million for the three and nine months ended September 30, 2000, respectively, compared to the same periods in 1999. The three-month decrease was primarily due to expenses incurred in 1999 for WP&L's Year 2000 readiness program. The nine-month increase was primarily due to the planned second quarter 2000 refueling outage at Kewaunee and increased energy conservation expense, partially offset by expenses incurred in 1999 for WP&L's Year 2000 readiness program and lower employee benefits costs. -36- Depreciation and amortization expense increased $5.6 million for the nine months ended September 30, 2000 compared with the same period in 1999, primarily due to increased earnings on the nuclear decommissioning trust fund (offset entirely in "Miscellaneous, net"). The accounting for earnings on the nuclear decommissioning trust funds results in no net income impact. Miscellaneous, net income increases for earnings on the trust fund and the corresponding offset is recorded as depreciation expense. Interest Expense and Other - Interest expense increased $0.8 million and $3.0 - -------------------------- million for the three and nine months ended September 30, 2000, respectively, compared with the same periods in 1999, primarily due to higher borrowings outstanding in 2000. Miscellaneous, net income increased $1.2 million and $5.3 million for the three and nine months ended September 30, 2000, respectively, compared with the same periods in 1999, due to increased earnings on the nuclear decommissioning trust fund. Income Taxes - Income taxes increased $1.4 million and $1.8 million for the - ------------ three and nine months ended September 30, 2000, respectively, compared with the same periods in 1999, primarily due to changes in pre-tax income. The three-month increase was partially offset by a lower effective income tax rate. The effective income tax rates were 37.3% and 37.4% for the three and nine months ended September 30, 2000, respectively, compared with 39.0% and 37.6%, respectively, for the same periods last year. LIQUIDITY AND CAPITAL RESOURCES Cash flows from operating activities at Alliant Energy decreased $7 million for the nine months ended September 30, 2000, compared with the same period in 1999, primarily due to changes in working capital. Cash flows from financing activities increased $391 million for the nine months ended September 30, 2000, compared with the same period in 1999, primarily as a result of changes in the amount of debt outstanding. Cash flows used for investing activities increased $464 million for the nine months ended September 30, 2000, compared with the same period in 1999, due to increased levels of construction and acquisition expenditures, primarily in the non-regulated businesses, including the $347 million invested in Brazil in January 2000. Cash flows from operating activities at IESU increased $25 million for the nine months ended September 30, 2000, compared with the same period in 1999, primarily due to changes in working capital. Cash flows used for financing activities decreased $47 million for the nine months ended September 30, 2000, compared with the same period in 1999, due to decreased common stock dividends in 2000. The dividend payment in the first quarter of 1999 was larger than IESU's historical quarterly payment as no dividend payments were made in the last three quarters of 1998 due to merger-related tax considerations. Cash flows used for investing activities increased $19 million for the nine months ended September 30, 2000, compared with the same period in 1999, due to increased levels of construction expenditures. Cash flows from operating activities at WP&L decreased $5 million for the nine months ended September 30, 2000, compared with the same period in 1999, primarily due to changes in working capital. Cash flows used for financing activities decreased $12 million for the nine months ended September 30, 2000, compared with the same period in 1999, as WP&L did not declare a common stock dividend during the first nine months of 2000 due to management of its capital structure. This was offset by a capital contribution of $30 million from Alliant Energy in 1999. Cash flows used for investing activities increased $5 million for the nine months ended September 30, 2000, compared with the same period in 1999, primarily due to increased levels of construction expenditures. Future Considerations On January 25, 2000, Resources acquired a stake in four Brazilian electric utilities serving more than 820,000 customers for a total investment of approximately $347 million. As part of this investment, Resources acquired a 49.1% ownership interest in Companhia Forca e Luz Cataguazes-Leopoldina (Cataguazes), an electric utility. Cataguazes owns a majority stake in CENF, another electric utility company, as well as a majority interest in Energisa -37- S.A., an energy development company. As part of the same investment, Resources directly acquired a 45.6% interest in Energisa S.A. itself, which holds majority stakes in two regulated utilities (Energipe and Celb). As part owner of Cataguazes, Resources holds both indirect and direct interests in Energisa S.A. Resources has entered into a shareholders agreement with the Brazilian companies, which permits it to name two directors to the boards of each company and its subsidiaries. The agreement also provides Resources with a role in selecting each company's management team, along with voting rights relating to critical issues at the Brazilian companies and their subsidiaries. The investment is accounted for under the equity method. As a result of a sale by Whiting of its interest in an offshore oil and gas production property in the fourth quarter of 1999, Whiting has a potential gain contingency of $500,000 relating to the sale that will be resolved in the fourth quarter of 2000. Such gain contingency has not yet been recognized in income. Alliant Energy's strategic plan includes pursuing three fundamental strategies: aggressively invest, better connect with customers and grow the business quickly. Alliant Energy expects that these strategies will contribute significantly to its annual earnings growth target of 7 to 10 percent. Refer to Notes 7 and 10 of Alliant Energy's Notes to Consolidated Financial Statements for a discussion of $402.5 million of exchangeable senior notes issued by Resources in February 2000. Refer to Part II, Item 1, "Legal Proceedings" for information regarding a federal lawsuit challenging certain provisions of WUHCA. Financing and Capital Structure WP&L issued $100 million of senior unsecured debentures in March 2000 at a fixed interest rate of 7-5/8%, due 2010. The net proceeds from the sale of the debentures were primarily used to repay short-term debt. Refer to Notes 7 and 10 of Alliant Energy's Notes to Consolidated Financial Statements for a discussion of $402.5 million of exchangeable senior notes issued by Resources in February 2000. Capital Requirements Refer to "Other Matters - Environmental" for a discussion of various issues impacting Alliant Energy's future capital requirements. Nuclear Facilities In February 1999, Alliant Energy, NSP, WPSC and WEPCO announced the formation of the NMC to sustain long-term safety, optimize reliability and improve the operational performance of their nuclear generating plants. Combined, the NMC members operate seven nuclear generating units at five plants. In October 1999, Alliant Energy received approval from the SEC, under PUHCA, to form Alliant Energy Nuclear LLC, whose purpose is solely to invest in the NMC. Such investment has been made and Alliant Energy Nuclear LLC now has a 25% ownership interest in the NMC. In November 1999, the NMC members applied to the NRC to allow the NMC to operate the plants owned or co-owned by the four utilities. Applications to the PSCW, MPUC and the SEC to allow the purchase of operating services were also made at that time. In May 2000, the NRC approved the transfer of operating authority to the NMC for DAEC and Kewaunee which was completed for both plants in August 2000. The utilities will continue to own their respective plants, be entitled to energy generated at the plants and retain the financial obligations for their safe operation, maintenance and decommissioning. In October 2000, the NMC members and CMS Energy announced their intention of adding CMS Energy as a fifth investor in the NMC. This will reduce Alliant Energy Nuclear LLC's ownership interest in the NMC from 25% to 20%. CMS Energy has also indicated its intention for its utility subsidiary, Consumers Power Company, to transfer operating authority to and enter into a service agreement with the NMC for operation of the Palisades Nuclear Plant, to be effective July 2001. Rates and Regulatory Matters In February and April 2000, the OCA requested certain financial information related to the electric utility operations within the state of Iowa from IESU and IPC, respectively. IESU and IPC have responded to its data requests -38- including follow-up requests in May and June 2000. Additionally, in August 2000, the OCA requested similar financial information from IESU and IPC for a non-calendar year period. IESU has responded to this data request and IPC is expected to finalize its response in November 2000. While IESU and IPC cannot predict the outcome of this process, such data requests could lead to an effort by the OCA to seek an electric rate reduction for IESU and/or IPC in Iowa. WP&L's retail electric rates are based in part on forecasted fuel and purchased-power costs. Under PSCW rules, WP&L can seek emergency rate increases if the annual costs are more than 3% higher than the estimated costs used to establish rates. If WP&L's earnings exceed its authorized return on equity, the incremental revenues collected causing the excessive return are subject to refund. WP&L does not believe any revenues collected to date are subject to refund. In December 1999, WP&L requested a $26 million retail electric rate increase to reflect higher purchased-power and transmission costs. Effective May 5, 2000, the PSCW granted WP&L a $16.5 million annual retail electric rate increase. In April 2000, the intervenors who had appealed the PSCW's order to grant WP&L rate recovery of $6.3 million of its Year 2000 program expenditures withdrew their appeal. WP&L began recovering such costs in May 2000 and is amortizing the deferred costs as the amounts are recovered in rates. OTHER MATTERS Labor Issues The collective bargaining agreements at Alliant Energy cover approximately 50% of all Alliant Energy employees. All agreements that had expired in 1999 and 2000 have been ratified and renewed. There are no other agreements expiring in 2000. Market Risk Sensitive Instruments and Positions Alliant Energy's primary market risk exposures are associated with interest rates, commodity prices, equity prices and currency exchange rates. Alliant Energy has risk management policies to monitor and assist in controlling these market risks and uses derivative instruments to manage some of the exposures. Alliant Energy's market risks have not changed materially from the market risks reported in the 1999 Form 10-K, except as noted below. Commodity Risk - Non-trading - Whiting is exposed to market risk in the - ---------------------------- pricing of its oil and gas production. Historically, prices received for oil and gas production have been volatile because of seasonal weather patterns, supply and demand factors, transportation availability and price, and general economic conditions. Worldwide political developments have historically also had an impact on oil prices. Periodically, Alliant Energy utilizes oil and gas swaps and forward contracts to mitigate the impact of oil and gas price fluctuations. Based on Whiting's estimated gas and crude oil sales in 2000, and the swaps and forward contracts in place at September 30, 2000, a 10% increase/decrease in gas and crude oil prices for that period would impact Alliant Energy's pre-tax 2000 earnings by approximately $8.5 million. A 10% increase/decrease in prices during 1999 would have impacted Alliant Energy's 1999 pre-tax earnings by approximately $3.0 million as relates to the commodity derivative instruments outstanding during 1999. Equity Price Risk - At September 30, 2000 and December 31, 1999, Alliant - ----------------- Energy had an investment in the stock of McLeod, a publicly traded telecommunications company, valued at $812 million and $1,124 million, respectively. In addition to the equity risk associated with the investment in McLeod, Alliant Energy also has equity risk related to the option liability embedded within Resources' exchangeable senior notes. Refer to Notes 7 and 10 of Alliant Energy's Notes to Consolidated Financial Statements for further discussion. A 10% increase (decrease) in the quoted market price of McLeod at September 30, 2000 would not have a significant impact on net income as any resulting increase (decrease) in the value of the option would be substantially offset by a corresponding increase (decrease) in the value of the McLeod shares classified as trading. At September 30, 2000, the McLeod available-for-sale securities were valued at $589 million. A 10% -39- increase (decrease) in the quoted market prices would have increased (decreased) the value of the investment by approximately $59 million. At September 30, 2000 and December 31, 1999, Alliant Energy also had various investments accounted for under both the equity and cost methods, in publicly traded utility companies in New Zealand and Australia (equity method only at September 30, 2000) which were valued at $64 million and $97 million, respectively. A 10% increase (decrease) in the quoted market prices at September 30, 2000 and December 31, 1999 would have increased (decreased) the value of the investment by approximately $6.4 million and $9.7 million, respectively. In the second quarter of 2000, Capstone completed its initial public offering and Alliant Energy's $10 million investment in Capstone was valued at $104 million at September 30, 2000. A 10% increase (decrease) in the quoted market price at September 30, 2000 would have increased (decreased) the value of the investment by approximately $10.4 million. Currency Risk - Alliant Energy has investments in various countries where the - ------------- net investments are not hedged, including Australia, Brazil, China and New Zealand. As a result, these investments are subject to currency exchange risk with fluctuations in currency exchange rates. At September 30, 2000 and December 31, 1999, Alliant Energy had a cumulative foreign currency translation loss of $50.1 million and $9.6 million, respectively, recorded in "Accumulated other comprehensive income" on its Consolidated Balance Sheets. The increase in the cumulative foreign currency translation loss is primarily due to declines in New Zealand, Brazil and Australia exchange rates. Based on Alliant Energy's investments at September 30, 2000 and December 31, 1999, a 10% sustained increase (decrease) over the next twelve months in the foreign exchange rates of Australia, Brazil, China and New Zealand would increase (decrease) the cumulative foreign currency translation loss by $46.7 million and $17.2 million, respectively. The significant increase in the cumulative translation adjustment account at September 30 is primarily due to the increase in the amount of Resources' investment in Brazil at September 30, 2000 compared with December 31, 1999. Environmental A summary of Alliant Energy's environmental issues is included in the Form 10-K filed by Alliant Energy, IESU and WP&L for the year ended December 31, 1999. Set forth below are several developments relating to Alliant Energy's environmental issues. Pursuant to an internal review of operations in 1998, IPC discovered that Unit No. 6 at its generating facility in Dubuque, Iowa required a Clean Air Act Acid Rain permit and CEMS. IPC informed environmental regulatory agencies, installed the CEMS and obtained the associated required permit. Pursuant to its internal review, IPC also identified and disclosed to regulators a potentially similar situation at its Lansing, Iowa generating facility. In the second quarter of 1999, the EPA determined that Lansing units 1 and 2 were affected units. Therefore, in the third quarter of 1999, IPC installed the CEMS at both of these facilities and in December 1999, IPC submitted its certification to the EPA for the Lansing facility. IPC received a settlement offer from the EPA, dated December 3, 1999, to settle the matter for $550,000. IPC responded with a counteroffer, and the parties reached an agreement in principle which contemplated a civil penalty payment and the performance of a supplemental environmental project with a combined value of approximately $400,000. In September 2000, a consent order was signed, and in October 2000, the civil penalty was paid and the supplemental environmental project was completed. In October 1998, the EPA issued a final rule requiring 22 states, including Wisconsin, to modify their state implementation plans to address the NOx issue. On May 25, 1999, a federal appeals court delayed indefinitely the implementation of the rule. On March 3, 2000, the court affirmed EPA's NOx rule for the affected states. However, the court found that the EPA had failed to explain how Wisconsin contributes significantly to non-attainment in any other state and therefore vacated the rule for Wisconsin. This decision was appealed by some of the affected states. On June 22, 2000, the lower court's ruling was upheld by the U.S. Court of Appeals and Wisconsin is still excluded. Although Wisconsin is not included in the federal rule, Wisconsin is still subject to the Clean Air Act due to its non-attainment status with respect to the one-hour ozone standard in the Lake Michigan region. WDNR has developed a rule that contains a plan for the state to meet the one-hour ozone attainment standard. The plan focuses on rate of progress requirements that are specified by the Clean Air Act for the years 2002, 2005 and 2007. The rule requires NOx reductions in an Ozone Control Region consisting of counties that are currently in non-attainment of the one-hour ozone standard which includes WP&L's Edgewater power plant. Alliant Energy is currently evaluating various alternatives to achieve the proposed reductions and continues to evaluate various options to reduce the emission levels. Based on existing technology, the preliminary estimates are that capital investments in the range of $30 million to $40 million could be required. -40- Power Supply Alliant Energy transferred its IESU and IPC regional reliability membership from the MAPP reliability region to the MAIN region effective in May 2000. Because WP&L is already a member of MAIN, this transfer should provide Alliant Energy additional operating flexibility to eliminate duplicate reporting requirements. Alliant Energy will continue to participate in the MAPP Regional Transmission Committee and the MAPP Power and Energy Market Committee. On April 25, 2000, Alliant Energy issued a request for proposal for a contract to construct a 500-600 megawatt power plant in Wisconsin. The construction of the facility is expected to assist Alliant Energy in meeting its growing demands for electricity, to enable Alliant Energy to place a greater reliance on internal generation versus purchased-power and to help Alliant Energy maintain the required 18% reserve margin in Wisconsin. Proposals were received in June 2000 and are currently being evaluated. ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK. Quantitative and Qualitative Disclosures About Market Risk are reported under Item 2. MD&A "Other Matters - Market Risk Sensitive Instruments and Positions." PART II - OTHER INFORMATION ITEM 1. LEGAL PROCEEDINGS In an effort to grow and expand as a Wisconsin-based company, Alliant Energy filed a federal lawsuit on October 11, 2000, seeking declaratory relief regarding whether certain provisions of WUHCA are unconstitutional as a violation of the interstate commerce and equal protection provisions. Alliant Energy is challenging the provisions of WUHCA which restrict ownership in utility holding companies, limit the investments those companies can make and place significant restrictions on companies that invest in Wisconsin utility holding companies. Alliant Energy has also requested that the court consider the constitutionality of issues related to the asset cap. Alliant Energy is seeking only declaratory relief and not damages in the litigation. No assurance can be given that Alliant Energy will be successful in the litigation. ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K (a) Exhibits: The following Exhibits are filed herewith. 10.1 Amendment No. 1 to Third Amended and Restated November 1998 Stockholders' Agreement entered into as of March 10, 2000, by and among McLeod, Alliant Energy, Investments and certain other principal stockholders of McLeod, dated as of July 7, 2000 10.2 Amendment No. 1 to Third Amended and Restated January 1999 Stockholders' Agreement entered into as of March 10, 2000, by and among McLeod, Alliant Energy, Investments and certain other principal stockholders of McLeod, dated as of July 7, 2000 27.1 Financial Data Schedule for Alliant Energy Corporation at and for the period ended September 30, 2000 27.2 Financial Data Schedule for IES Utilities Inc. at and for the period ended September 30, 2000 27.3 Financial Data Schedule for Wisconsin Power and Light Company at and for the period ended September 30, 2000 -41- (b) Reports on Form 8-K: Alliant Energy - None. WP&L - None. IESU - None. -42- SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, Alliant Energy Corporation, IES Utilities Inc. and Wisconsin Power and Light Company have each duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized on the 10th day of November 2000. ALLIANT ENERGY CORPORATION - -------------------------- Registrant By: /s/ John E. Kratchmer Corporate Controller and Chief Accounting Officer - ------------------------- (Principal Accounting Officer and Authorized John E. Kratchmer Signatory) IES UTILITIES INC. - ------------------ Registrant By: /s/ John E. Kratchmer Corporate Controller and Chief Accounting Officer - ------------------------- (Principal Accounting Officer and Authorized John E. Kratchmer Signatory) WISCONSIN POWER AND LIGHT COMPANY - --------------------------------- Registrant By: /s/ John E. Kratchmer Corporate Controller and Chief Accounting Officer - ------------------------- (Principal Accounting Officer and Authorized John E. Kratchmer Signatory) -43- EX-10 2 0002.txt EXHIBIT 10.1 Exhibit 10.1 AMENDMENT NO. 1 TO THIRD AMENDED AND RESTATED NOVEMBER 1998 STOCKHOLDERS' AGREEMENT AMENDMENT NO. 1 (this "AMENDMENT") dated as of July 7, 2000 by and among the parties set forth on the signature pages of this Amendment. Section 1. DEFINITIONS. Except as otherwise defined in this Amendment, terms defined in the Third Amended and Restated November 1998 Stockholders' Agreement dated as of March 10, 2000 (as from time to time amended, the "AGREEMENT") are used herein as defined therein. Section 2. AMENDMENTS. The Company has requested the Principal Stockholders to amend the Agreement in certain respects, and the Principal Stockholders are willing to so amend the Agreement, all on the terms and conditions set forth herein. Accordingly, the parties hereto hereby agree that effective as of the date hereof, the Agreement shall be amended as follows: A. BOARD OF DIRECTORS SIZE. The reference to "thirteen (13)" relating to the authorized size of the Board of Directors in Section 1.1(a) is deleted and replaced with a reference to "fourteen (14)". B. NON-EMPLOYEE DIRECTORS. The reference to "eight (8)" relating to the number of non-employee directors in Section 1.1(f) is deleted and replaced with a reference to "nine (9)". C. GENERAL. Any references to the Agreement after the date first set forth above (including but not limited to references in the Agreement to "this Agreement" (including indirect references such as "hereunder", "hereby", "herein" and "hereof")) shall be deemed to be references to the Agreement as amended hereby. For purposes of Section 5.1 of the Agreement, "the date of this Agreement" shall continue to be March 10, 2000. Section 3. MISCELLANEOUS. Except as herein provided, the Agreement shall remain unchanged and continue in full force and effect. This Amendment may be executed in any number of counterparts, all of which taken together shall constitute one and the same instrument and any of the parties hereto may execute this Amendment by signing any such counterpart. This Amendment shall be governed by, and construed in accordance with, the law of the State of Delaware (excluding the choice-of-law rules thereof). The headings of the sections and subsections of this Amendment have been inserted for convenience only and shall not be deemed to be a part of this Amendment. IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed and delivered as of the date first above written. McLEODUSA INCORPORATED By: /s/ J. Lyle Patrick --------------------------------- Name: J. Lyle Patrick Title: Group Vice President/CFO /s/ Clark E. McLeod /s/ Mary E. McLeod - ----------------------- ---------------------------- Clark E. McLeod Mary E. McLeod ALLIANT ENERGY CORPORATION By: /s/ James E. Hoffman ----------------------------- Name: James E. Hoffman Title: ALLIANT ENERGY FOUNDATION, INC. By: /s/ Edward M. Gleason ------------------------------ Name: Edward M. Gleason Title: Treasurer ALLIANT ENERGY INVESTMENTS, INC. By: /s/ James E. Hoffman ------------------------------ Name: James E. Hoffman Title: President, Alliant Energy Resources HEARTLAND PROPERTIES, INC. By: /s/ Henry Wertheimer ----------------------------- Name: Henry Wertheimer Title: Vice President/Treasurer LNT COMMUNICATIONS LLC By: Alliant Energy Resources, Inc., its sole member By: /s/ James E. Hoffman ------------------------------ Name: James E. Hoffman Title: President Gail G. Lumpkin Trust Dated 12/14/85 /s/ Richard A. Lumpkin BY: /s/ Richard A. Lumpkin - -------------------------- --------------------------- Richard A. Lumpkin Richard A. Lumpkin, Trustee The two trusts created under the Mary Green Lumpkin Gallo Trust Agreement dated December 29, 1989, one for the benefit of each of: Benjamin Iverson Lumpkin Elizabeth Arabella Lumpkin United States Trust Company of New York, Trustee By: /s/ Loraine B. Tsavaris ------------------------------- Name: Loraine B. Tsavaris Title: Managing Director The two trusts created under the Richard Adamson Lumpkin Grandchildren's Trust dated September 5, 1980, one for the benefit of each of: Benjamin Iverson Lumpkin Elizabeth Arabella Lumpkin United States Trust Company of New York, Trustee By: /s/ Loraine B. Tsavaris ------------------------------- Name: Loraine B. Tsavaris Title: Managing Director The trust established by Richard Adamson Lumpkin under the Trust Agreement dated February 6, 1970, for the benefit of Richard Anthony Lumpkin United States Trust Company of New York, Trustee By: /s/ Loraine B. Tsavaris ----------------------------- Name: Loraine B. Tsavaris Title: Managing Director The two 1990 Personal Income Trusts established by Richard A. Lumpkin, dated April 20, 1990, one for the benefit of each of: Benjamin Iverson Lumpkin Elizabeth Arabella Lumpkin By: /s/ David R. Hodgman - --------------------------------- David R. Hodgman, Trustee By: /s/ Steven L. Grissom - -------------------------------- Steven L. Grissom, Trustee EX-10 3 0003.txt EXHIBIT 10.2 Exhibit 10.2 AMENDMENT NO. 1 TO THIRD AMENDED AND RESTATED JANUARY 1999 STOCKHOLDERS' AGREEMENT AMENDMENT NO. 1 (this "AMENDMENT") dated as of July 7, 2000 by and among the parties set forth on the signature pages of this Amendment. Section 1. DEFINITIONS. Except as otherwise defined in this Amendment, terms defined in the Third Amended and Restated January 1999 Stockholders' Agreement dated as of March 10, 2000 (as from time to time amended, the "AGREEMENT") are used herein as defined therein. Section 2. AMENDMENTS. The Company has requested the Original Stockholders and the M/C Stockholders to amend the Agreement in certain respects, and the Original Stockholders and the M/C Stockholders are willing to so amend the Agreement, all on the terms and conditions set forth herein. Accordingly, the parties hereto hereby agree that effective as of the date hereof, the Agreement shall be amended as follows: A. BOARD OF DIRECTORS SIZE. The reference to "thirteen (13)" relating to the authorized size of the Board of Directors in Section 2.1(a) is deleted and replaced with a reference to "fourteen (14)". B. NON-EMPLOYEE DIRECTORS. The reference to "seven (7)" relating to the number of non-employee directors in Section 2.1(g) is deleted and replaced with a reference to "eight (8)". C. GENERAL. Any references to the Agreement after the date first set forth above (including but not limited to references in the Agreement to "this Agreement" (including indirect references such as "hereunder", "hereby", "herein" and "hereof')) shall be deemed to be references to the Agreement as amended hereby. For purposes of Section 5.1 of the Agreement, "the date of this Agreement" shall continue to be March 10, 2000. Section 3. MISCELLANEOUS. Except as herein provided, the Agreement shall remain unchanged and continue in full force and effect. This Amendment may be executed in any number of counterparts, all of which taken together shall constitute one and the same instrument and any of the parties hereto may execute this Amendment by signing any such counterpart. This Amendment shall be governed by, and construed in accordance with, the law of the State of Delaware (excluding the choice-of-law rules thereof). The headings of the sections and subsections of this Amendment have been inserted for convenience only and shall not be deemed to be a part of this Amendment. IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed and delivered as of the date first above written. McLEODUSA INCORPORATED By: /s/ J. Lyle Patrick ---------------------------------- Name: J. Lyle Patrick Title: Group Vice President/CFO /s/ Clark E. McLeod /s/ Mary E. McLeod - ----------------------------- -------------------------------- Clark E. McLeod Mary E. McLeod M/C INVESTORS L.L.C. By /s/ Peter H.O. Claudy ---------------------------------- Name: Peter H.O. Claudy Title: Manager MEDIA/COMMUNICATIONS PARTNERS III LIMITED PARTNERSHIP By: M/C III L.L.C., its General Partner By: /s/ Peter H.O. Claudy ---------------------------------- Name: Peter H.O. Claudy Title: Manager ALLIANT ENERGY CORPORATION, INC. By /s/ James E. Hoffman ---------------------------------- Name: James E. Hoffman Title: ALLIANT ENERGY FOUNDATION By: /s/ E.M. Gleason --------------------------------- Name: Edward M. Gleason Title: Treasurer ALLIANT ENERGY INVESTMENTS, INC. By: /s/ James E. Hoffman --------------------------------- Name: James E. Hoffman Title: President, Alliant Energy Resources HEARTLAND PROPERTIES, INC. By: /s/ Henry Wertheimer --------------------------------- Name: Henry Wertheimer Title: Vice President/Treasurer LNT COMMUNICATIONS LLC By: Alliant Energy Resources, Inc., its sole member By: /s/ James E. Hoffman --------------------------------- Name: James E. Hoffman Title: President Gail G. Lumpkin Trust Dated 12/14/85 /s/ Richard A. Lumpkin BY: /s/ Richard A. Lumpkin - ------------------------- ----------------------------- Richard A. Lumpkin Richard A. Lumpkin, Trustee
The two trusts created under the Mary Green The two trusts created under the Richard Lumpkin Gallo Trust Agreement dated Adamson Lumpkin Grandchildren's December 29, 1989, one for the benefit of each Trust dated September 5, 1980, one for the of: the benefit of each of: Benjamin Iverson Lumpkin Benjamin Iverson Lumpkin Elizabeth Arabella Lumpkin Elizabeth Arabella Lumpkin United States Trust Company United States Trust Company of New York, Trustee of New York, Trustee By: /s/ Loraine B. Tsavaris By: /s/ Loraine B. Tsavaris ------------------------------ ----------------------------- Name: Loraine B. Tsavaris Name: Loraine B. Tsavaris Title: Managing Director Title: Managing Director
The trust established by Richard Adamson The two 1990 Personal Income Trusts Lumpkin under the Trust Agreement dated established by Richard A. Lumpkin, dated February 6, 1970, for the benefit of Richard April 20, 1990, one for the benefit of each Anthony Lumpkin. of: Benjamin Iverson Lumpkin Elizabeth Arabella Lumpkin United States Trust Company of New York, Trustee
/s/ David R. Hodgman --------------------------- David R. Hodgman, Trustee By: /s/ Loraine B. Tsavaris /s/ Steven L. Grissom - ----------------------------- ----------------------------- Name: Loraine B. Tsavaris Steven L. Grissom, Trustee Title: Managing Director EX-27.1 4 0004.txt FINANCIAL DATA SCHEDULE
UT This schedule contains summary financial information extracted from the September 30, 2000 Financial Statements included in Alliant Energy Corporation's Form 10-Q and is qualified in its entirety by reference to such Financial Statements. 0000352541 ALLIANT ENERGY CORPORATION 1,000 9-MOS DEC-31-2000 JAN-01-2000 SEP-30-2000 PER-BOOK 3,116,372 2,281,298 485,774 208,202 255,795 6,347,441 790 946,687 1,130,685 2,078,162 24,650 89,102 1,591,859 35,034 55,100 412,755 92,704 0 17,365 12,075 1,938,635 6,347,441 1,851,837 213,879 1,563,259 1,563,259 288,578 395,634 684,212 127,452 342,881 5,035 337,846 118,475 145,490 360,237 4.28 4.27 Includes $333,850 of Accumulated Other Comprehensive Income. Income tax expense is not included in Operating Expense in the Consolidated Statements of Income. Includes $16,708 of Cumulative Effect of a Change in Accounting Principle, Net of Tax. Includes $321,349 of Gain on Reclassification of Investments.
EX-27.2 5 0005.txt FINANCIAL DATA SCHEDULE
UT This schedule contains summary financial information extracted from the September 30, 2000 Financial Statements included in IES Utilities Inc.'s Form 10-Q and is qualified in its entirety by reference to such Financial Statements. 0000052485 IES UTILITIES INC. 1,000 9-MOS DEC-31-2000 JAN-01-2000 SEP-30-2000 PER-BOOK 1,365,486 126,577 133,836 13,108 117,236 1,756,243 33,427 279,042 268,317 580,786 0 18,320 469,708 77,004 0 0 81,560 0 17,284 12,057 499,524 1,756,243 624,999 43,285 491,177 491,177 133,822 7,688 141,510 38,208 60,017 686 59,331 43,975 39,002 175,619 0 0 Includes $8 of Accumulated Other Comprehensive Income. Income tax expense is not included in Operating Expense in the Consolidated Statements of Income. Earnings per share of common stock is not reflected because all common shares are held by Alliant Energy Corporation.
EX-27.3 6 0006.txt FINANCIAL DATA SCHEDULE
UT This schedule contains summary financial information extracted from the September 30, 2000 Financial Statements included in Wisconsin Power and Light Company's Form 10-Q and is qualified in its entirety by reference to such Financial Statements. 0000107832 WISCONSIN POWER AND LIGHT COMPANY 1,000 9-MOS DEC-31-2000 JAN-01-2000 SEP-30-2000 PER-BOOK 1,232,335 191,156 117,388 161,336 82,973 1,785,188 66,183 229,437 350,423 646,043 0 59,963 514,170 25,560 55,100 0 1,875 0 0 0 482,477 1,785,188 612,332 30,343 509,799 509,799 102,533 11,888 114,421 33,327 50,751 2,483 48,268 0 42,023 126,540 0 0 Includes <$1,321> of Accumulated Other Comprehensive Income. Income tax expense is not included in Operating Expense in the Consolidated Statements of Income. Includes $35 of Cumulative Effect of a Change in Accounting Principle, Net of Tax. Earnings per share of common stock is not reflected because all common shares are held by Alliant Energy Corporation.
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