-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: keymaster@town.hall.org Originator-Key-Asymmetric: MFkwCgYEVQgBAQICAgADSwAwSAJBALeWW4xDV4i7+b6+UyPn5RtObb1cJ7VkACDq pKb9/DClgTKIm08lCfoilvi9Wl4SODbR1+1waHhiGmeZO8OdgLUCAwEAAQ== MIC-Info: RSA-MD5,RSA, jOtsahYs+32MrRHNrZyAt8UI/hzqsmB56ozni7J0YT7dhsDMB/pnRdLKtxcJWMyC tRrPPDQG8MS0qHQaUB4fAg== 0000006879-94-000014.txt : 19940512 0000006879-94-000014.hdr.sgml : 19940512 ACCESSION NUMBER: 0000006879-94-000014 CONFORMED SUBMISSION TYPE: U-1/A PUBLIC DOCUMENT COUNT: 1 FILED AS OF DATE: 19940511 FILER: COMPANY DATA: COMPANY CONFORMED NAME: APPALACHIAN POWER CO CENTRAL INDEX KEY: 0000006879 STANDARD INDUSTRIAL CLASSIFICATION: 4911 IRS NUMBER: 540124790 STATE OF INCORPORATION: VA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: U-1/A SEC ACT: 1935 Act SEC FILE NUMBER: 070-08377 FILM NUMBER: 94527147 BUSINESS ADDRESS: STREET 1: 40 FRANKLIN RD SW CITY: ROANOKE STATE: VA ZIP: 24011 BUSINESS PHONE: 7039852300 MAIL ADDRESS: STREET 1: 1 RIVERSIDE PLAZA CITY: COLUMBUS STATE: OH ZIP: 43215 U-1/A 1 70-8377 TENDER OFFERS AMENDMENT NO. 2 File No. 70-8377 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ______________________________ AMENDMENT NO. 2 TO FORM U-1 _______________________________ APPLICATION OR DECLARATION under the PUBLIC UTILITY HOLDING COMPANY ACT OF 1935 * * * APPALACHIAN POWER COMPANY 40 Franklin Road, Roanoke, Virginia 24022 COLUMBUS SOUTHERN POWER COMPANY 215 North Front Street, Columbus, Ohio 43215 INDIANA MICHIGAN POWER COMPANY One Summit Square, P.O. Box 60, Fort Wayne, Indiana 46801 KENTUCKY POWER COMPANY 1701 Central Avenue, P.O. Box 1428, Ashland, Kentucky 41101 OHIO POWER COMPANY 301 Cleveland Avenue, S.W., Canton, Ohio 44702 (Name of companies filing this statement and addresses of principal executive offices) * * * AMERICAN ELECTRIC POWER COMPANY, INC. 1 Riverside Plaza, Columbus, Ohio 43215 (Name of top registered holding company parent of each applicant or declarant) * * * G. P. Maloney, Executive Vice President AMERICAN ELECTRIC POWER SERVICE CORPORATION 1 Riverside Plaza, Columbus, Ohio 43215 A. Joseph Dowd, General Counsel AMERICAN ELECTRIC POWER SERVICE CORPORATION 1 Riverside Plaza, Columbus, Ohio 43215 (Names and addresses of agents for service) Appalachian Power Company ("APCo"), Columbus Southern Power Company ("CSPCo"), Indiana Michigan Power Company ("I&M"), Kentucky Power Company ("KPCo") and Ohio Power Company ("OPCo") (sometimes individually referred to herein as "Company" and collectively as "Companies"), hereby amend their Application or Declaration in File No. 70-8377 by filing Balance Sheets as of December 31, 1993, and Statements of Income and Retained Earnings, per books and pro forma, for the 12 months ended December 31, 1993, of each of the Companies and of AEP and its subsidiaries consolidated, together with journal entries reflecting the proposed transaction. SIGNATURE Pursuant to the requirements of the Public Utility Holding Company Act of 1935, the undersigned companies have duly caused this statement to be signed on their behalf by the under- signed thereunto duly authorized. APPALACHIAN POWER COMPANY COLUMBUS SOUTHERN POWER COMPANY INDIANA MICHIGAN POWER COMPANY KENTUCKY POWER COMPANY OHIO POWER COMPANY By_/s/ G. P. Maloney_____ Vice President Dated: May 10, 1994 finance\70-8377.#2 FINANCIAL STATEMENTS PAGE 1 AMERICAN ELECTRIC POWER COMPANY BALANCE SHEET December 31, 1993 (in thousands)
Pro Forma Per Books Adjustments Pro Forma --------- ----------- --------- ASSETS Electric Utility Plant: Production. . . . . . . . . . . . . . . . . . $9,079,130 $9,079,130 Transmission. . . . . . . . . . . . . . . . . 3,169,347 3,169,347 Distribution. . . . . . . . . . . . . . . . . 3,743,047 3,743,047 General . . . . . . . . . . . . . . . . . . . 1,406,159 1,406,159 Construction Work In Progress . . . . . . . . 314,489 314,489 Total Electric Utility Plant. . . . . 17,712,172 17,712,172 Accumulated Depreciation and Amortization. . . . . . . . . . . . . . (6,612,131) (6,612,131) Net Electric Utility Plant. . . . . . 11,100,041 11,100,041 Other Property and Investments. . . . . . . . . 724,373 724,373 Current Assets: Cash and Cash Equivalents . . . . . . . . . . 42,561 ($17,908) 24,653 Accounts Receivable: Customers . . . . . . . . . . . . . . . . . 377,299 377,299 Miscellaneous . . . . . . . . . . . . . . . 90,514 90,514 Allowance for Uncollectible Accounts. . . . (4,048) (4,048) Fuel - at average cost. . . . . . . . . . . . 314,441 314,441 Materials and Supplies - at average cost. . . 207,373 207,373 Accrued Utility Revenues. . . . . . . . . . . 169,905 169,905 Prepayments and Other . . . . . . . . . . . . 98,958 98,958 Total Current Assets. . . . . . . . . 1,297,003 (17,908) 1,279,095 Regulatory Assets: Amounts Due From Customers for Future Federal Income Taxes. . . . . . . . . . . . 1,363,802 1,363,802 Other . . . . . . . . . . . . . . . . . . . . 856,182 111,725 967,907 Total Regulatory Assets . . . . . . . 2,219,984 111,725 2,331,709 Total . . . . . . . . . . . . . . .$15,341,401 $93,817 $15,435,218 The ProForma Adjustments are shown on Pages 3 and 3A of these Financial Statements.
FINANCIAL STATEMENTS PAGE 2 AMERICAN ELECTRIC POWER COMPANY BALANCE SHEET December 31, 1993 (in thousands)
Pro Forma Per Books Adjustments Pro Forma --------- ----------- --------- CAPITALIZATION AND LIABILITIES Capitalization: Common Stock. . . . . . . . . . . . . . . . . $1,257,977 $1,257,977 Paid-in Capital . . . . . . . . . . . . . . . 1,625,068 ($750) 1,624,318 Retained Earnings . . . . . . . . . . . . . . 1,269,283 1,269,283 Total Common Shareowners' Equity. . . 4,152,328 (750) 4,151,578 Cumulative Preferred Stock: Not Subject to Mandatory Redemption . . . . 268,240 268,240 Subject to Mandatory Redemption . . . . . . 500,450 - 500,450 Long-term Debt. . . . . . . . . . . . . . . . 4,964,060 - 4,964,060 Total Capitalization. . . . . . . . . 9,885,078 (750) 9,884,328 Other Noncurrent Liabilities. . . . . . . . . . 509,317 509,317 Current Liabilities: Long-term Debt Due Within One Year. . . . . . 31,141 31,141 Short-term Debt . . . . . . . . . . . . . . . 278,976 94,567 373,543 Accounts Payable. . . . . . . . . . . . . . . 259,145 259,145 Taxes Accrued . . . . . . . . . . . . . . . . 409,198 409,198 Interest Accrued. . . . . . . . . . . . . . . 91,161 91,161 Obligations Under Capital Leases. . . . . . . 62,215 62,215 Other . . . . . . . . . . . . . . . . . . . . 338,988 338,988 Total Current Liabilities . . . . . . 1,470,824 94,567 1,565,391 Deferred Federal Income Taxes . . . . . . . . . 2,468,015 2,468,015 Deferred Investment Tax Credits . . . . . . . . 487,501 487,501 Deferred Gain on Sale and Leaseback - Rockport Plant Unit 2 . . . . . . . . . . . . 430,091 430,091 Deferred Credits. . . . . . . . . . . . . . . . 90,575 90,575 Total . . . . . . . . . . . . . . .$15,341,401 $93,817 $15,435,218 The ProForma Adjustments are shown on Pages 3 and 3A of these Financial Statements.
FINANCIAL STATEMENTS PAGE 3 AMERICAN ELECTRIC POWER COMPANY BALANCE SHEET December 31, 1993 PRO FORMA ADJUSTMENTS
Debit Credit (in thousands) 1) Cash $938,025 Other Regulatory Assets - Unamortized Debt Expense 9,475 Long-term Debt - First Mortgage Bonds $947,500 To record the issuance and sale of first mortgage bonds at 100%* and record the estimated expense of the debt issuance. 2) Long-term Debt - First Mortgage Bonds 947,500 Other Regulatory Assets - Loss on Reacquired Debt 94,750 Cash 955,933 Short-term Debt 86,317 To record the purchase and redemption of the first mortgage bonds listed below at a 10%* premium using cash and short-term debt.
APCo 9-1/8% Series due 11/1/2019 $ 47,500,000 9-7/8% Series due 12/1/2020 48,000,000 9.35% Series due 8/1/2021 50,000,000 8.75% Series due 2/1/2022 50,000,000 8.70% Series due 5/22/2022 40,000,000 8.50% Series due 12/1/2022 70,000,000 CSP 8.95% Series due 12/20/95 $ 30,000,000 9.15% Series due 2/2/98 57,000,000 9.625% Series due 6/1/2021 50,000,000 9.31% Series due 8/1/2001 30,000,000 8.70% Series due 7/1/2022 35,000,000 8.55% Series due 8/1/2022 15,000,000 I&M 9.50% Series due 5/1/2021 $ 40,000,000 8.75% Series due 5/1/2022 50,000,000 8.50% Series due 12/15/2022 75,000,000 KYPCo 8.95% Series due 5/10/2001 $ 20,000,000 8.90% Series due 5/21/2001 40,000,000 OPCo 9-7/8% Series due 8/1/2020 $ 50,000,000 9.625% Series due 6/1/2021 50,000,000 8.80% Series due 2/10/2022 50,000,000 8.75% Series due 6/1/2022 50,000,000 TOTAL 947,500,000 FINANCIAL STATEMENTS PAGE 3A AMERICAN ELECTRIC POWER COMPANY BALANCE SHEET December 31, 1993 PRO FORMA ADJUSTMENTS
Debit Credit (in thousands) 3) Cash 74,250 Paid-in Capital 750 Cumulative Preferred Stock 75,000 To record the issuance and sale of preferred stock by Columbus Southern Power Company at 100%* and record the estimated expense of issuance. 4) Cumulative Preferred Stock 75,000 Other Regulatory Assets - Unamortized Premium on Reacquired Preferred Stock 7,500 Cash 74,250 Short-term Debt 8,250 To record the purchase and redemption of the 9.50% Series $100 par value Cumulative Preferred Stock by Columbus Southern Power Company at a 10%* premium using cash and short-term debt and to defer the premium. These entries do not reflect any possible cash flow effect from the current tax benefit of debt reacquisition costs. * Price assumed solely for the purpose of these Pro Forma Financial Statements.
FINANCIAL STATEMENTS PAGE 3B AMERICAN ELECTRIC POWER COMPANY STATEMENT OF INCOME Year Ended December 31, 1993 PRO FORMA ADJUSTMENTS Increase (Decrease) (in thousands) Interest on new first mortgage bonds @ 8%* $75,800 Amortization of Debt Issuance Expense over 30 years. 316 Interest on new Short-term Debt @ 4%* 3,783 Interest on retired first mortgage bonds: APCo 9-1/8% Series due 11/1/2019 $ 47,500,000 (4,334) 9-7/8% Series due 12/1/2020 48,000,000 (4,740) 9.35% Series due 8/1/2021 50,000,000 (4,675) 8.75% Series due 2/1/2022 50,000,000 (4,375) 8.70% Series due 5/22/2022 40,000,000 (3,480) 8.50% Series due 12/1/2022 70,000,000 (5,950) CSP 8.95% Series due 12/20/95 $ 30,000,000 (2,685) 9.15% Series due 2/2/98 57,000,000 (5,216) 9.625% Series due 6/1/2021 50,000,000 (4,813) 9.31% Series due 8/1/2001 30,000,000 (2,793) 8.70% Series due 7/1/2022 35,000,000 (3,045) 8.55% Series due 8/1/2022 15,000,000 (1,283) I&M 9.50% Series due 5/1/2021 $ 40,000,000 (3,800) 8.75% Series due 5/1/2022 50,000,000 (4,375) 8.50% Series due 12/15/2022 75,000,000 (6,375) KYPCo 8.95% Series due 5/10/2001 $ 20,000,000 (1,790) 8.90% Series due 5/21/2001 40,000,000 (3,560) OPCo 9-7/8% Series due 8/1/2020 $ 50,000,000 (4,938) 9.625% Series due 6/1/2021 50,000,000 (4,813) 8.80% Series due 2/10/2022 50,000,000 (4,400) 8.75% Series due 6/1/2022 50,000,000 (4,375) Subtotal Interest - (85,815) Amortization of Redemption Premiums over 30 years. 3,158 Federal Income Taxes @ 35% 965 To reflect the pro forma changes in interest charges associated with the proposed transactions and the related federal income tax effect. * Price assumed solely for the purpose of these Pro Forma Financial Statements. FINANCIAL STATEMENTS PAGE 4 AMERICAN ELECTRIC POWER COMPANY STATEMENT OF INCOME Year Ended December 31, 1993 (in thousands)
Pro Forma Per Books Adjustments Pro Forma --------- ----------- --------- Operating Revenues. . . . . . . . . . . . . . . $5,268,842 $5,268,842 Operating Expenses: Fuel and Purchased Power. . . . . . . . . . . 1,647,573 1,647,573 Other Operation . . . . . . . . . . . . . . . 965,329 965,329 Maintenance . . . . . . . . . . . . . . . . . 523,062 523,062 Depreciation and Amortization . . . . . . . . 530,731 530,731 Taxes Other Than Federal Income Taxes . . . . 470,346 470,346 Federal Income Taxes. . . . . . . . . . . . . 203,431 $965 204,396 Total Operating Expenses. . . . . . . . . 4,340,472 965 4,341,437 Operating Income . . . . . . . . . . . . . . . 928,370 (965) 927,405 Nonoperating Income: Deferred Zimmer Plant Carrying Charges (net of tax). . . . . . . . . . . . 25,343 25,343 Other . . . . . . . . . . . . . . . . . . . . 21,229 21,229 Total Nonoperating Income . . . . . . . . 46,572 0 46,572 Loss From Zimmer Plant Disallowance: Disallowed Cost . . . . . . . . . . . . . . . 159,067 159,067 Related Income Taxes. . . . . . . . . . . . . (14,534) (14,534) Net Zimmer Loss . . . . . . . . . . . . . 144,533 144,533 Income Before Interest Charges. . . . . . . . . 830,409 (965) 829,444 Interest Charges. . . . . . . . . . . . . . . . 417,822 (2,758) 415,064 Preferred Stock Dividend Requirements of Subsidiaries. . . . . . . . . 58,818 (1,625) 57,193 Earnings Applicable to Common Stock . . . . . . $353,769 $3,418 $357,187 Average Number of Shares Outstanding. . . . . . 184,535 184,535 Earnings Per Share . . . . . . . . . . . . . . $1.92 $1.94 The ProForma Adjustments are shown on Page 3B of these Financial Statements.
FINANCIAL STATEMENTS PAGE 5 AMERICAN ELECTRIC POWER COMPANY STATEMENT OF RETAINED EARNINGS YEAR ENDED DECEMBER 31, 1993 (in thousands) Retained Earnings January 1 . . . . . . . . . $1,358,800 Net Income. . . . . . . . . . . . . . . . . . 353,769 Deductions: Cash Dividends Declared on Common Stock . . 442,891 Other . . . . . . . . . . . . . . . . . . . 395 Retained Earnings December 31 . . . . . . . . $1,269,283 FINANCIAL STATEMENTS PAGE 6 APPALACHIAN POWER COMPANY BALANCE SHEET December 31, 1993 (in thousands)
Pro Forma Per Books Adjustments Pro Forma --------- ----------- --------- ASSETS Electric Utility Plant: Production. . . . . . . . . . . . . . . . . . $1,767,759 $1,767,759 Transmission. . . . . . . . . . . . . . . . . 985,775 985,775 Distribution. . . . . . . . . . . . . . . . . 1,225,436 1,225,436 General . . . . . . . . . . . . . . . . . . . 140,932 140,932 Construction Work In Progress . . . . . . . . 59,166 59,166 Total Electric Utility Plant. . . . . 4,179,068 4,179,068 Accumulated Depreciation and Amortization. . . . . . . . . . . . . . (1,546,196) (1,546,196) Net Electric Utility Plant. . . . . . 2,632,872 2,632,872 Other Property and Investments. . . . . . . . . 59,073 59,073 Current Assets: Cash and Cash Equivalents . . . . . . . . . . 2,765 ($2,765) 0 Accounts Receivable: Customers . . . . . . . . . . . . . . . . . 118,523 118,523 Affiliated Companies. . . . . . . . . . . . 9,597 9,597 Miscellaneous . . . . . . . . . . . . . . . 3,424 3,424 Allowance for Uncollectible Accounts. . . . (1,344) (1,344) Fuel - at average cost. . . . . . . . . . . . 46,881 46,881 Materials and Supplies - at average cost. . . 43,184 43,184 Accrued Utility Revenues. . . . . . . . . . . 58,294 58,294 Prepayments . . . . . . . . . . . . . . . . . 7,030 7,030 Total Current Assets. . . . . . . . . 288,354 (2,765) 285,589 Regulatory Assets: Amounts Due From Customers for Future Federal Income Taxes. . . . . . . . . . . . 314,744 314,744 Other . . . . . . . . . . . . . . . . . . . . 119,425 33,605 153,030 Total Regulatory Assets . . . . . . . 434,169 33,605 467,774 Total . . . . . . . . . . . . . . . $3,414,468 $30,840 $3,445,308 * Includes investments in Subsidiaries of $28,959,000. The ProForma Adjustments are shown on Page 8 of these Financial Statements.
FINANCIAL STATEMENTS PAGE 7 APPALACHIAN POWER COMPANY BALANCE SHEET December 31, 1993 (in thousands)
Pro Forma Per Books Adjustments Pro Forma --------- ----------- --------- CAPITALIZATION AND LIABILITIES Capitalization: Common Stock. . . . . . . . . . . . . . . . . $260,458 $260,458 Paid-in Capital . . . . . . . . . . . . . . . 494,834 494,834 Retained Earnings . . . . . . . . . . . . . . 227,816 227,816 Total Common Shareowners' Equity. . . 983,108 983,108 Cumulative Preferred Stock: Not Subject to Mandatory Redemption . . . . 55,000 55,000 Subject to Mandatory Redemption . . . . . . 160,450 160,450 Long-term Debt. . . . . . . . . . . . . . . . 1,215,124 $ - 1,215,124 Total Capitalization. . . . . . . . . 2,413,682 0 2,413,682 Other Noncurrent Liabilities. . . . . . . . . . 54,229 54,229 Current Liabilities: Cumulative Preferred Stock Due Within One Year . . . . . . . . . . . . 87 87 Long-term Debt Due Within One Year. . . . . . 44 44 Short-term Debt . . . . . . . . . . . . . . . 36,100 30,840 66,940 Accounts Payable: General. . . . . . . . . . . . . . . . . . 33,481 33,481 Affiliated Companies . . . . . . . . . . . 37,100 37,100 Taxes Accrued . . . . . . . . . . . . . . . . 50,790 50,790 Customer Deposits . . . . . . . . . . . . . . 13,670 13,670 Interest Accrued. . . . . . . . . . . . . . . 18,189 18,189 Other . . . . . . . . . . . . . . . . . . . . 69,115 69,115 Total Current Liabilities . . . . . . 258,576 30,840 289,416 Deferred Federal Income Taxes . . . . . . . . . 573,375 573,375 Deferred Investment Tax Credits . . . . . . . . 82,968 82,968 Regulatory Liabilities and Deferred Credits . . 31,638 31,638 Total . . . . . . . . . . . . . . . $3,414,468 $30,840 $3,445,308 The ProForma Adjustments are shown on Page 8 of these Financial Statements.
FINANCIAL STATEMENTS PAGE 8 APPALACHIAN POWER COMPANY BALANCE SHEET December 31, 1993 PRO FORMA ADJUSTMENTS
Debit Credit (in thousands) 1) Cash $302,445 Other Regulatory Assets - Unamortized Debt Expense 3,055 Long-term Debt - First Mortgage Bonds $305,500 To record the issuance and sale of first mortgage bonds at 100%* and record the estimated expense of the debt issuance. 2) Long-term Debt - First Mortgage Bonds 305,500 Other Regulatory Assets - Loss on Reacquired Debt 30,550 Cash 305,210 Short-term Debt 30,840 To record the purchase and redemption of the first mortgage bonds listed below at a 10%* premium using cash and short-term debt. 9-1/8% Series due 11/1/2019 $ 47,500,000 9-7/8% Series due 12/1/2020 48,000,000 9.35% Series due 8/1/2021 50,000,000 8.75% Series due 2/1/2022 50,000,000 8.70% Series due 5/22/2022 40,000,000 8.50% Series due 12/1/2022 70,000,000 These entries do not reflect any possible cash flow effect from the current tax benefit of debt reacquisition costs. * Price assumed solely for the purpose of these Pro Forma Financial Statements.
FINANCIAL STATEMENTS PAGE 8A APPALACHIAN POWER COMPANY STATEMENT OF INCOME Year Ended December 31, 1993 PRO FORMA ADJUSTMENTS Increase (Decrease) (in thousands) Interest on new first mortgage bonds @ 8%* $24,440 Amortization of Debt Issuance Expense over 30 years. 102 Interest on new Short-term Debt @ 4%* 1,234 Interest on retired first mortgage bonds: 9-1/8% Series due 11/1/2019 $ 47,500,000 (4,334) 9-7/8% Series due 12/1/2020 48,000,000 (4,740) 9.35% Series due 8/1/2021 50,000,000 (4,675) 8.75% Series due 2/1/2022 50,000,000 (4,375) 8.70% Series due 5/22/2022 40,000,000 (3,480) 8.50% Series due 12/1/2022 70,000,000 (5,950) Amortization of Redemption Premiums over 30 years. 1,018 Federal Income Taxes @ 35% 266 To reflect the pro forma changes in interest charges associated with the proposed transactions and the related federal income tax effect. * Price assumed solely for the purpose of these Pro Forma Financial Statements. FINANCIAL STATEMENTS PAGE 9 APPALACHIAN POWER COMPANY STATEMENT OF INCOME Year Ended December 31, 1993 (in thousands)
Pro Forma Per Books Adjustments Pro Forma --------- ----------- --------- Operating Revenues. . . . . . . . . . . . . . . $1,519,118 $1,519,118 Operating Expenses: Fuel and Purchased Power. . . . . . . . . . . 697,019 697,019 Other Operation . . . . . . . . . . . . . . . 185,412 185,412 Maintenance . . . . . . . . . . . . . . . . . 119,265 119,265 Depreciation and Amortization . . . . . . . . 123,066 123,066 Taxes Other Than Federal Income Taxes . . . . 111,892 111,892 Federal Income Taxes. . . . . . . . . . . . . 54,077 $266 54,343 Total Operating Expenses. . . . . . . . . 1,290,731 266 1,290,997 Operating Income . . . . . . . . . . . . . . . 228,387 (266) 228,121 Nonoperating Income: Equity in Earnings of Subsidiary Companies. . 469 469 Other . . . . . . . . . . . . . . . . . . . . (3,004) (3,004) Total Nonoperating Income (Loss). . . . . (2,535) 0 (2,535) Income Before Interest Charges. . . . . . . . . 225,852 (266) 225,586 Interest Charges. . . . . . . . . . . . . . . . 100,720 (760) 99,960 Preferred Stock Dividend Requirements . . . . . 16,540 16,540 Earnings Applicable to Common Stock . . . . . . $108,592 $494 $109,086 The ProForma Adjustments are shown on Page 8A of these Financial Statements.
FINANCIAL STATEMENTS PAGE 10 APPALACHIAN POWER COMPANY STATEMENT OF RETAINED EARNINGS YEAR ENDED DECEMBER 31, 1993 (in thousands) Retained Earnings January 1 . . . . . . . . . $229,920 Net Income. . . . . . . . . . . . . . . . . . 125,132 Deductions: Cash Dividends Declared on Common Stock . . 110,696 Cash Dividends Declared on Cumulative Preferred Stock . . . . . . . . . . . . . 16,011 Other . . . . . . . . . . . . . . . . . . . 529 Retained Earnings December 31 . . . . . . . . $227,816 FINANCIAL STATEMENTS PAGE 11 COLUMBUS SOUTHERN POWER COMPANY BALANCE SHEET December 31, 1993 (in thousands)
Pro Forma Per Books Adjustments Pro Forma --------- ----------- --------- ASSETS Electric Utility Plant: Production. . . . . . . . . . . . . . . . . . $1,443,506 $1,443,506 Transmission. . . . . . . . . . . . . . . . . 295,539 295,539 Distribution. . . . . . . . . . . . . . . . . 755,342 755,342 General . . . . . . . . . . . . . . . . . . . 94,678 94,678 Construction Work In Progress . . . . . . . . 52,794 52,794 Total Electric Utility Plant. . . . . 2,641,859 2,641,859 Accumulated Depreciation and Amortization. . . . . . . . . . . . . . (810,167) (810,167) Net Electric Utility Plant. . . . . . 1,831,692 1,831,692 Other Property and Investments* . . . . . . . . 36,588 36,588 Current Assets: Cash and Cash Equivalents . . . . . . . . . . 6,123 $(6,123) 0 Accounts Receivable: Customers . . . . . . . . . . . . . . . . . 42,906 42,906 Affiliated Companies. . . . . . . . . . . . 1,084 1,084 Miscellaneous . . . . . . . . . . . . . . . 8,094 8,094 Allowance for Uncollectible Accounts. . . . (991) (991) Fuel - at average cost. . . . . . . . . . . . 32,257 32,257 Materials and Supplies - at average cost. . . 24,872 24,872 Accrued Utility Revenues. . . . . . . . . . . 28,889 28,889 Prepayments and Other . . . . . . . . . . . . 30,178 30,178 Total Current Assets. . . . . . . . . 173,412 (6,123) 167,289 Regulatory Assets: Amounts Due From Customers for Future Federal Income Taxes. . . . . . . . . . . . 290,295 290,295 Other . . . . . . . . . . . . . . . . . . . . 249,387 31,370 280,757 Total Regulatory Assets . . . . . . . 539,682 31,370 571,052 Total . . . . . . . . . . . . . . . $2,581,374 $25,247 $2,606,621 * Includes investments in Subsidiaries of $5,005,000. The ProForma Adjustments are shown on Page 13 of these Financial Statements.
FINANCIAL STATEMENTS PAGE 12 COLUMBUS SOUTHERN POWER COMPANY BALANCE SHEET December 31, 1993 (in thousands)
Pro Forma Per Books Adjustments Pro Forma --------- ----------- --------- CAPITALIZATION AND LIABILITIES Capitalization: Common Stock. . . . . . . . . . . . . . . . . $41,026 $41,026 Paid-in Capital . . . . . . . . . . . . . . . 566,046 $(750) 565,296 Retained Earnings . . . . . . . . . . . . . . 18,288 18,288 Total Common Shareowners' Equity. . . 625,360 (750) 624,610 Cumulative Preferred Stock: Subject to Mandatory Redemption . . . . . . 125,000 - 125,000 Long-term Debt. . . . . . . . . . . . . . . . 997,013 - 997,013 Total Capitalization. . . . . . . . . 1,747,373 (750) 1,746,623 Other Noncurrent Liabilities. . . . . . . . . . 16,846 16,846 Current Liabilities: Long-term Debt Due Within One Year. . . . . . 20,700 20,700 Short-term Debt . . . . . . . . . . . . . . . 25,225 25,997 51,222 Accounts Payable: General. . . . . . . . . . . . . . . . . . 36,871 36,871 Affiliated Companies . . . . . . . . . . . 15,917 15,917 Taxes Accrued . . . . . . . . . . . . . . . . 114,149 114,149 Interest Accrued. . . . . . . . . . . . . . . 23,245 23,245 Other . . . . . . . . . . . . . . . . . . . . 20,727 20,727 Total Current Liabilities . . . . . . 256,834 25,997 282,831 Deferred Federal Income Taxes . . . . . . . . . 474,744 474,744 Deferred Investment Tax Credits . . . . . . . . 68,473 68,473 Deferred Credits. . . . . . . . . . . . . . . . 17,104 17,104 Total . . . . . . . . . . . . . . . $2,581,374 $25,247 $2,606,621 The ProForma Adjustments are shown on Page 13 of these Financial Statements.
FINANCIAL STATEMENTS PAGE 13 COLUMBUS SOUTHERN POWER COMPANY BALANCE SHEET December 31, 1993 PRO FORMA ADJUSTMENTS
Debit Credit (in thousands) 1) Cash $214,830 Other Regulatory Assets - Unamortized Debt Expense 2,170 Long-term Debt - First Mortgage Bonds $217,000 To record the issuance and sale of first mortgage bonds at 100%* and record the estimated expense of the debt issuance. 2) Long-term Debt - First Mortgage Bonds 217,000 Other Regulatory Assets - Loss on Reacquired Debt 21,700 Cash 220,953 Short-term Debt 17,747 To record the purchase and redemption of the first mortgage bonds listed below at a 10%* premium using cash and short-term debt. 8.95% Series due 12/20/95 $ 30,000,000 9.15% Series due 2/2/98 57,000,000 9.625% Series due 6/1/2021 50,000,000 9.31% Series due 8/1/2001 30,000,000 8.70% Series due 7/1/2022 35,000,000 8.55% Series due 8/1/2022 15,000,000 3) Cash 74,250 Paid-in Capital 750 Cumulative Preferred Stock 75,000 To record the issuance and sale of preferred stock at 100%* and record the estimated expense of issuance. 4) Cumulative Preferred Stock 75,000 Other Regulatory Assets - Unamortized Premium on Reacquired Preferred Stock 7,500 Cash 74,250 Short-term Debt 8,250 To record the purchase and redemption of the 9.50% Series $100 par value Cumulative Preferred Stock at a 10%* premium using cash and short-term debt and to defer the premium. These entries do not reflect any possible cash flow effect from the current tax benefit of debt reacquisition costs. * Rate assumed solely for the purpose of these Prio Forms Financial Statements.
FINANCIAL STATEMENTS PAGE 13A COLUMBUS SOUTHERN POWER COMPANY STATEMENT OF INCOME Year Ended December 31, 1993 PRO FORMA ADJUSTMENTS Increase (Decrease) (in thousands) Interest on new first mortgage bonds @ 8%* $17,360 Amortization of Debt Issuance Expense over 30 years. 72 Interest on new Short-term Debt @ 4%* 1,040 Interest on retired first mortgage bonds: 8.95% Series due 12/20/95 $ 30,000,000 (2,685) 9.15% Series due 2/2/98 57,000,000 (5,216) 9.625% Series due 6/1/2021 50,000,000 (4,813) 9.31% Series due 8/1/2001 30,000,000 (2,793) 8.70% Series due 7/1/2022 35,000,000 (3,045) 8.55% Series due 8/1/2022 15,000,000 (1,283) Amortization of Redemption Premiums over 30 years. 723 Federal Income Taxes @ 35% 223 To reflect the pro forma changes in interest charges associated with the proposed transactions and the related federal income tax effect. _________________________________________________________ Preferred Stock Dividend Requirements on New Stock @ 7%* 5,250 Preferred Stock Dividend Requirements on 9.50% Series (7,125) Amortization of Redemption Premium on Cumulative Preferred Stock over 30 years. 250 To reflect the pro forma changes in Preferred Stock Dividend Requirements associated with the proposed transactions and the amortization of deferred premiums. * Price assumed solely for the purpose of these Pro Forma Financial Statements. FINANCIAL STATEMENTS PAGE 14 COLUMBUS SOUTHERN POWER COMPANY STATEMENT OF INCOME Year Ended December 31, 1993 (in thousands)
Pro Forma Per Books Adjustments Pro Forma --------- ----------- --------- Operating Revenues. . . . . . . . . . . . . . . $953,652 $953,652 Operating Expenses: Fuel and Purchased Power. . . . . . . . . . . 347,160 347,160 Other Operation . . . . . . . . . . . . . . . 170,397 170,397 Maintenance . . . . . . . . . . . . . . . . . 71,537 71,537 Depreciation . . . . . . . . . . . . . . . . 84,883 84,883 Deferral of Zimmer Plant Phase-in Costs . . . (8,913) (8,913) Taxes Other Than Federal Income Taxes . . . . 99,348 99,348 Federal Income Taxes. . . . . . . . . . . . . 39,317 $223 39,540 Total Operating Expenses. . . . . . . . . 803,729 223 803,952 Operating Income . . . . . . . . . . . . . . . 149,923 (223) 149,700 Nonoperating Income: Deferred Zimmer Plant Carrying Charges (net of tax). . . . . . . . . . . . 25,343 25,343 Equity in Earnings of Subsidiary Companies. . 356 356 Other . . . . . . . . . . . . . . . . . . . . 1,937 1,937 Total Nonoperating Income . . . . . . . . 27,636 0 27,636 Loss From Zimmer Plant Disallowance: Disallowed Cost . . . . . . . . . . . . . . . 159,067 159,067 Related Income Taxes. . . . . . . . . . . . . (14,534) (14,534) Net Zimmer Loss . . . . . . . . . . . . . 144,533 144,533 Income Before Interest Charges. . . . . . . . . 33,026 (223) 32,803 Interest Charges. . . . . . . . . . . . . . . . 88,924 (640) 88,284 Preferred Stock Dividend Requirements . . . . . 11,062 (1,625) 9,437 Earnings Applicable to Common Stock . . . . . . ($66,960) $2,042 $(64,918) The ProForma Adjustments are shown on Page 13A of these Financial Statements.
FINANCIAL STATEMENTS PAGE 15 COLUMBUS SOUTHERN POWER COMPANY STATEMENT OF RETAINED EARNINGS YEAR ENDED DECEMBER 31, 1993 (in thousands) Retained Earnings January 1 . . . . . . . . . $127,562 Net Income. . . . . . . . . . . . . . . . . . (55,898) Deductions: Cash Dividends Declared on Common Stock . . 42,175 Cash Dividends Declared on Cumulative Preferred Stock . . . . . . . . . . . . . 11,062 Other . . . . . . . . . . . . . . . . . . . 139 Retained Earnings December 31 . . . . . . . . $18,288 FINANCIAL STATEMENTS PAGE 16 INDIANA MICHIGAN POWER COMPANY BALANCE SHEET December 31, 1993 (in thousands)
Pro Forma Per Books Adjustments Pro Forma --------- ----------- --------- ASSETS Electric Utility Plant: Production. . . . . . . . . . . . . . . . . . $2,602,527 $2,602,527 Transmission. . . . . . . . . . . . . . . . . 839,198 839,198 Distribution. . . . . . . . . . . . . . . . . 608,752 608,752 General (including nuclear fuel). . . . . . . 152,470 152,470 Construction Work In Progress . . . . . . . . 88,010 88,010 Total Electric Utility Plant. . . . . 4,290,957 4,290,957 Accumulated Depreciation and Amortization. . . . . . . . . . . . . . (1,714,829) (1,714,829) Net Electric Utility Plant. . . . . . 2,576,128 2,576,128 Other Property and Investments* . . . . . . . . 439,995 439,995 Current Assets: Cash and Cash Equivalents . . . . . . . . . . 3,727 ($3,727) 0 Accounts Receivable: Customers . . . . . . . . . . . . . . . . . 67,246 67,246 Affiliated Companies. . . . . . . . . . . . 24,507 24,507 Miscellaneous . . . . . . . . . . . . . . . 15,290 15,290 Allowance for Uncollectible Accounts. . . . (504) (504) Fuel - at average cost. . . . . . . . . . . . 34,476 34,476 Materials and Supplies - at average cost. . . 57,800 57,800 Accrued Utility Revenues. . . . . . . . . . . 34,642 34,642 Prepayments and Other . . . . . . . . . . . . 11,998 11,998 Total Current Assets. . . . . . . . . 249,182 (3,727) 245,455 Regulatory Assets: Amounts Due From Customers for Future Federal Income Taxes. . . . . . . . . . . . 271,036 18,150 289,186 Other . . . . . . . . . . . . . . . . . . . . 205,874 205,874 Total Regulatory Assets . . . . . . . 476,910 18,150 495,060 Total . . . . . . . . . . . . . . . $3,742,215 $14,423 $3,756,638 * Includes investments in Subsidiaries of $101,426,000. The ProForma Adjustments are shown on Page 18 of these Financial Statements.
FINANCIAL STATEMENTS PAGE 17 INDIANA MICHIGAN POWER COMPANY BALANCE SHEET December 31, 1993 (in thousands)
Pro Forma Per Books Adjustments Pro Forma --------- ----------- --------- CAPITALIZATION AND LIABILITIES Capitalization: Common Stock. . . . . . . . . . . . . . . . . $56,584 $56,584 Paid-in Capital . . . . . . . . . . . . . . . 734,933 734,933 Retained Earnings . . . . . . . . . . . . . . 177,638 177,638 Total Common Shareowners' Equity. . . 969,155 969,155 Cumulative Preferred Stock: Not Subject to Mandatory Redemption . . . . 87,000 87,000 Subject to Mandatory Redemption . . . . . . 100,000 100,000 Long-term Debt. . . . . . . . . . . . . . . . 1,073,154 $ - 1,073,154 Total Capitalization. . . . . . . . . 2,229,309 - 2,229,309 Other Noncurrent Liabilities. . . . . . . . . . 288,197 288,197 Current Liabilities: Short-term Debt . . . . . . . . . . . . . . . 50,075 14,423 64,498 Accounts Payable: General. . . . . . . . . . . . . . . . . . 40,437 40,437 Affiliated Companies . . . . . . . . . . . 20,156 20,156 Taxes Accrued . . . . . . . . . . . . . . . . 54,154 54,154 Interest Accrued. . . . . . . . . . . . . . . 18,894 18,894 Obligations Under Capital Leases. . . . . . . 20,585 20,585 Other . . . . . . . . . . . . . . . . . . . . 79,247 79,247 Total Current Liabilities . . . . . . 283,548 14,423 297,971 Deferred Federal Income Taxes . . . . . . . . . 531,157 531,157 Deferred Investment Tax Credits . . . . . . . . 186,032 186,032 Deferred Gain on Sale and Leaseback - Rockport Plant Unit 2 . . . . . . . . . . . . 211,446 211,446 Deferred Credits. . . . . . . . . . . . . . . . 12,526 12,526 Total . . . . . . . . . . . . . . . $3,742,215 $14,423 $3,756,638 The ProForma Adjustments are shown on Page 18 of these Financial Statements.
FINANCIAL STATEMENTS PAGE 18 INDIANA MICHIGAN POWER COMPANY BALANCE SHEET December 31, 1993 PRO FORMA ADJUSTMENTS
Debit Credit (in thousands) 1) Cash $163,350 Other Regulatory Assets - Unamortized Debt Expense 1,650 Long-term Debt - First Mortgage Bonds $165,000 To record the issuance and sale of first mortgage bonds at 100%* and record the estimated expense of the debt issuance. 2) Long-term Debt - First Mortgage Bonds 165,000 Other Regulatory Assets - Loss on Reacquired Debt 16,500 Cash 167,077 Short-term Debt 14,423 To record the purchase and redemption of the first mortgage bonds listed below at a 10%* premium using cash and short-term debt. 9.50% Series due 5/1/2021 $ 40,000,000 8.75% Series due 5/1/2022 50,000,000 8.50% Series due 12/15/2022 75,000,000 These entries do not reflect any possible cash flow effect from the current tax benefit of debt reacquisition costs. * Price assumed solely for the purpose of these Pro Forma Financial Statements.
FINANCIAL STATEMENTS PAGE 18A INDIANA MICHIGAN POWER COMPANY STATEMENT OF INCOME Year Ended December 31, 1993 PRO FORMA ADJUSTMENTS Increase (Decrease) (in thousands) Interest on new first mortgage bonds @ 8%* $13,200 Amortization of Debt Issuance Expense over 30 years. 55 Interest on new Short-term Debt @ 4%* 577 Interest on retired first mortgage bonds: 9.50% Series due 5/1/2021 $ 40,000,000 (3,800) 8.75% Series due 5/1/2022 50,000,000 (4,375) 8.50% Series due 12/15/2022 75,000,000 (6,375) Amortization of Redemption Premiums over 30 years. 550 Federal Income Taxes @ 35% 59 To reflect the pro forma changes in interest charges associated with the proposed transactions and the related federal income tax effect. * Price assumed solely for the purpose of these Pro Forma Financial Statements. FINANCIAL STATEMENTS PAGE 19 INDIANA MICHIGAN POWER COMPANY STATEMENT OF INCOME Year Ended December 31, 1993 (in thousands)
Pro Forma Per Books Adjustments Pro Forma --------- ----------- --------- Operating Revenues. . . . . . . . . . . . . . . $1,202,643 $1,202,643 Operating Expenses: Fuel and Purchased Power. . . . . . . . . . . 328,480 328,480 Other Operation . . . . . . . . . . . . . . . 264,543 264,543 Maintenance . . . . . . . . . . . . . . . . . 142,637 142,637 Depreciation and Amortization . . . . . . . . 138,794 138,794 Amortization of Rockport Plant Unit 1 Phase-in Plan Deferrals . . . . . . . . . . 15,644 15,644 Taxes Other Than Federal Income Taxes . . . . 67,918 67,918 Federal Income Taxes. . . . . . . . . . . . . 34,707 $59 34,766 Total Operating Expenses. . . . . . . . . 992,723 59 992,782 Operating Income . . . . . . . . . . . . . . . 209,920 (59) 209,861 Nonoperating Income: Equity in Earnings of Subsidiary Companies. . (311) (311) Other . . . . . . . . . . . . . . . . . . . . 77 77 Total Nonoperating Income (Loss). . . . . (234) 0 (234) Income Before Interest Charges. . . . . . . . . 209,686 (59) 209,627 Interest Charges. . . . . . . . . . . . . . . . 80,373 (168) 80,205 Preferred Stock Dividend Requirements . . . . . 14,225 14,225 Earnings Applicable to Common Stock . . . . . . $115,088 $109 $115,197 The ProForma Adjustments are shown on Page 18A of these Financial Statements.
FINANCIAL STATEMENTS PAGE 20 INDIANA MICHIGAN POWER COMPANY STATEMENT OF RETAINED EARNINGS YEAR ENDED DECEMBER 31, 1993 (in thousands) Retained Earnings January 1 . . . . . . . . . $171,309 Net Income. . . . . . . . . . . . . . . . . . 129,313 Deductions: Cash Dividends Declared on Common Stock . . 108,696 Cash Dividends Declared on Cumulative Preferred Stock . . . . . . . . . . . . . 14,225 Other . . . . . . . . . . . . . . . . . . . 63 Retained Earnings December 31 . . . . . . . . $177,638 FINANCIAL STATEMENTS PAGE 21 KENTUCKY POWER COMPANY BALANCE SHEET December 31, 1993 (in thousands)
Pro Forma Per Books Adjustments Pro Forma --------- ----------- --------- ASSETS Electric Utility Plant: Production. . . . . . . . . . . . . . . . . . $211,617 $211,617 Transmission. . . . . . . . . . . . . . . . . 249,966 249,966 Distribution. . . . . . . . . . . . . . . . . 281,834 281,834 General . . . . . . . . . . . . . . . . . . . 54,637 54,637 Construction Work In Progress . . . . . . . . 9,374 9,374 Total Electric Utility Plant. . . . . 807,428 807,428 Accumulated Depreciation and Amortization. . . . . . . . . . . . . . (248,673) (248,673) Net Electric Utility Plant. . . . . . 558,755 558,755 Other Property and Investments. . . . . . . . . 6,763 6,763 Current Assets: Cash and Cash Equivalents . . . . . . . . . . 858 ($858) 0 Accounts Receivable: Customers . . . . . . . . . . . . . . . . . 18,385 18,385 Affiliated Companies. . . . . . . . . . . . 4,183 4,183 Miscellaneous . . . . . . . . . . . . . . . 1,778 1,778 Allowance for Uncollectible Accounts. . . . (208) (208) Fuel - at average cost. . . . . . . . . . . . 8,405 8,405 Materials and Supplies - at average cost. . . 8,804 8,804 Accrued Utility Revenues. . . . . . . . . . . 10,476 10,476 Prepayments . . . . . . . . . . . . . . . . . 1,367 1,367 Total Current Assets. . . . . . . . . 54,048 (858) 53,190 Regulatory Assets: Amounts Due From Customers for Future Federal Income Taxes. . . . . . . . . . . . 37,910 37,910 Other . . . . . . . . . . . . . . . . . . . . 12,903 6,600 19,503 Total Regulatory Assets . . . . . . . 50,813 6,600 57,413 Total . . . . . . . . . . . . . . . $670,379 $5,742 $676,121 The ProForma Adjustments are shown on Page 23 of these Financial Statements.
FINANCIAL STATEMENTS PAGE 22 KENTUCKY POWER COMPANY BALANCE SHEET December 31, 1993 (in thousands)
Pro Forma Per Books Adjustments Pro Forma --------- ----------- --------- CAPITALIZATION AND LIABILITIES Capitalization: Common Stock. . . . . . . . . . . . . . . . . $50,450 $50,450 Paid-in Capital . . . . . . . . . . . . . . . 58,750 58,750 Retained Earnings . . . . . . . . . . . . . . 85,296 85,296 Total Common Shareowners' Equity. . . 194,496 194,496 Long-term Debt. . . . . . . . . . . . . . . . 253,495 $ - 253,495 Total Capitalization. . . . . . . . . 447,991 - 447,991 Other Noncurrent Liabilities. . . . . . . . . . 7,678 7,678 Current Liabilities: Short-term Debt . . . . . . . . . . . . . . . 38,150 5,742 43,892 Accounts Payable: General. . . . . . . . . . . . . . . . . . 10,392 10,392 Affiliated Companies . . . . . . . . . . . 8,064 8,064 Customer Deposits . . . . . . . . . . . . . . 4,621 4,621 Taxes Accrued . . . . . . . . . . . . . . . . 6,767 6,767 Interest Accrued. . . . . . . . . . . . . . . 5,905 5,905 Other . . . . . . . . . . . . . . . . . . . . 8,186 8,186 Total Current Liabilities . . . . . . 82,085 5,742 87,827 Deferred Federal Income Taxes . . . . . . . . . 108,966 108,966 Deferred Investment Tax Credits . . . . . . . . 16,454 16,454 Deferred Credits. . . . . . . . . . . . . . . . 7,205 7,205 Total . . . . . . . . . . . . . . . $670,379 $5,742 $676,121 The ProForma Adjustments are shown on Page 23 of these Financial Statements.
FINANCIAL STATEMENTS PAGE 23 KENTUCKY POWER COMPANY BALANCE SHEET December 31, 1993 PRO FORMA ADJUSTMENTS
Debit Credit (in thousands) 1) Cash $59,400 Other Regulatory Assets - Unamortized Debt Expense 600 Long-term Debt - First Mortgage Bonds $60,000 To record the issuance and sale of first mortgage bonds at 100%* and record the estimated expense of the debt issuance. 2) Long-term Debt - First Mortgage Bonds 60,000 Other Regulatory Assets - Loss on Reacquired Debt 6,000 Cash 60,258 Short-term Debt 5,742 To record the purchase and redemption of the first mortgage bonds listed below at a 10%* premium using cash and short-term debt. 8.95% Series due 5/10/2001 $ 20,000,000 8.90% Series due 5/21/2001 40,000,000 These entries do not reflect any possible cash flow effect from the current tax benefit of debt reacquisition costs. * Price assumed solely for the purpose of these Pro Forma Financial Statements.
FINANCIAL STATEMENTS PAGE 23A KENTUCKY POWER COMPANY STATEMENT OF INCOME Year Ended December 31, 1993 PRO FORMA ADJUSTMENTS Increase (Decrease) (in thousands) Interest on new first mortgage bonds @ 8%* $4,800 Amortization of Debt Issuance Expense over 30 years. 20 Interest on new Short-term Debt @ 4%* 230 Interest on retired first mortgage bonds: 8.95% Series due 5/10/2001 $ 20,000,000 (1,790) 8.90% Series due 5/21/2001 40,000,000 (3,560) Amortization of Redemption Premiums over 30 years. 200 Federal Income Taxes @ 35% 35 To reflect the pro forma changes in interest charges associated with the proposed transactions and the related federal income tax effect. * Price assumed solely for the purpose of these Pro Forma Financial Statements. FINANCIAL STATEMENTS PAGE 24 KENTUCKY POWER COMPANY STATEMENT OF INCOME Year Ended December 31, 1993 (in thousands)
Pro Forma Per Books Adjustments Pro Forma --------- ----------- --------- Operating Revenues. . . . . . . . . . . . . . . $294,252 $294,252 Operating Expenses: Fuel and Purchased Power. . . . . . . . . . . 156,912 156,912 Other Operation . . . . . . . . . . . . . . . 38,688 38,688 Maintenance . . . . . . . . . . . . . . . . . 28,687 28,687 Depreciation and Amortization . . . . . . . . 22,275 22,275 Taxes Other Than Federal Income Taxes . . . . 7,504 7,504 Federal Income Taxes. . . . . . . . . . . . . 1,450 $35 1,485 Total Operating Expenses. . . . . . . . . 255,516 35 255,551 Operating Income . . . . . . . . . . . . . . . 38,736 (35) 38,701 Nonoperating Income . . . . . . . . . . . . . . 59 59 Income Before Interest Charges. . . . . . . . . 38,795 (35) 38,760 Interest Charges. . . . . . . . . . . . . . . . 20,764 (100) 20,664 Earnings Applicable to Common Stock . . . . . . $18,031 $65 $18,096 The ProForma Adjustments are shown on Page 23A of these Financial Statements.
FINANCIAL STATEMENTS PAGE 25 KENTUCKY POWER COMPANY STATEMENT OF RETAINED EARNINGS YEAR ENDED DECEMBER 31, 1993 (in thousands) Retained Earnings January 1 . . . . . . . . . $89,957 Net Income. . . . . . . . . . . . . . . . . . 18,031 Cash Dividends Declared . . . . . . . . . . . 22,692 Retained Earnings December 31 . . . . . . . . $85,296 FINANCIAL STATEMENTS PAGE 26 OHIO POWER COMPANY BALANCE SHEET December 31, 1993 (in thousands)
Pro Forma Per Books Adjustments Pro Forma --------- ----------- --------- ASSETS Electric Utility Plant: Production. . . . . . . . . . . . . . . . . . $2,412,973 $2,412,973 Transmission. . . . . . . . . . . . . . . . . 767,548 767,548 Distribution. . . . . . . . . . . . . . . . . 766,639 766,639 General (including mining assets) . . . . . . 194,913 194,913 Construction Work In Progress . . . . . . . . 94,538 94,538 Total Electric Utility Plant. . . . . 4,236,611 4,236,611 Accumulated Depreciation and Amortization. . . . . . . . . . . . . . (1,728,828) (1,728,828) Net Electric Utility Plant. . . . . . 2,507,783 2,507,783 Other Property and Investments* . . . . . . . . 252,365 252,365 Current Assets: Cash and Cash Equivalents . . . . . . . . . . 4,435 $(4,435) 0 Accounts Receivable: Customers . . . . . . . . . . . . . . . . . 118,133 118,133 Affiliated Companies. . . . . . . . . . . . 24,912 24,912 Miscellaneous . . . . . . . . . . . . . . . 14,368 14,368 Allowance for Uncollectible Accounts. . . . (960) (960) Fuel - at average cost. . . . . . . . . . . . 175,801 175,801 Materials and Supplies - at average cost. . . 41,208 41,208 Accrued Utility Revenues. . . . . . . . . . . 32,234 32,234 Prepayments and Other . . . . . . . . . . . . 40,846 40,846 Total Current Assets. . . . . . . . . 450,977 (4,435) 446,542 Regulatory Assets: Amounts Due From Customers for Future Federal Income Taxes. . . . . . . . . . . . 372,890 372,890 Other . . . . . . . . . . . . . . . . . . . . 206,464 22,000 228,464 Total Regulatory Assets . . . . . . . 579,354 22,000 601,354 Total . . . . . . . . . . . . . . . $3,790,479 $17,565 $3,808,044 * Includes investments in Subsidiaries of $183,656,000. The ProForma Adjustments are shown on Page 28 of these Financial Statements.
FINANCIAL STATEMENTS PAGE 27 OHIO POWER COMPANY BALANCE SHEET December 31, 1993 (in thousands)
Pro Forma Per Books Adjustments Pro Forma --------- ----------- --------- CAPITALIZATION AND LIABILITIES Capitalization: Common Stock. . . . . . . . . . . . . . . . . $321,201 $321,201 Paid-in Capital . . . . . . . . . . . . . . . 463,100 463,100 Retained Earnings . . . . . . . . . . . . . . 474,500 474,500 Total Common Shareowners' Equity. . . 1,258,801 1,258,801 Cumulative Preferred Stock: Not Subject to Mandatory Redemption . . . . 126,240 126,240 Subject to Mandatory Redemption . . . . . . 115,000 115,000 Long-term Debt. . . . . . . . . . . . . . . . 1,092,968 $ - 1,092,968 Total Capitalization. . . . . . . . . 2,593,009 - 2,593,009 Other Noncurrent Liabilities. . . . . . . . . . 40,821 40,821 Current Liabilities: Short-term Debt . . . . . . . . . . . . . . . 38,000 17,565 55,565 Accounts Payable: General. . . . . . . . . . . . . . . . . . 106,105 106,105 Affiliated Companies . . . . . . . . . . . 27,746 27,746 Taxes Accrued . . . . . . . . . . . . . . . . 166,115 166,115 Interest Accrued. . . . . . . . . . . . . . . 18,850 18,850 Obligations Under Capital Leases. . . . . . . 5,124 5,124 Other . . . . . . . . . . . . . . . . . . . . 60,410 60,410 Total Current Liabilities . . . . . . 422,350 17,565 439,915 Deferred Federal Income Taxes . . . . . . . . . 648,901 648,901 Deferred Investment Tax Credits . . . . . . . . 45,795 45,795 Regulatory Liabilities and Deferred Credits . . 39,603 39,603 Total . . . . . . . . . . . . . . . $3,790,479 $17,565 $3,808,044 The ProForma Adjustments are shown on Page 28 of these Financial Statements.
FINANCIAL STATEMENTS PAGE 28 OHIO POWER COMPANY BALANCE SHEET December 31, 1993 PRO FORMA ADJUSTMENTS
Debit Credit (in thousands) 1) Cash $198,000 Other Regulatory Assets - Unamortized Debt Expense 2,000 Long-term Debt - First Mortgage Bonds $200,000 To record the issuance and sale of first mortgage bonds at 100%* and record the estimated expense of the debt issuance. 2) Long-term Debt - First Mortgage Bonds 200,000 Other Regulatory Assets - Loss on Reacquired Debt 20,000 Cash 202,435 Short-term Debt 17,565 To record the purchase and redemption of the first mortgage bonds listed below at a 10%* premium using cash and short-term debt. 9-7/8% Series due 8/1/2020 $ 50,000,000 9.625% Series due 6/1/2021 50,000,000 8.80% Series due 2/10/2022 50,000,000 8.75% Series due 6/1/2022 50,000,000 These entries do not reflect any possible cash flow effect from the current tax benefit of debt reacquisition costs. * Price assumed solely for the purpose of these Pro Forma Financial Statements.
FINANCIAL STATEMENTS PAGE 28A OHIO POWER COMPANY STATEMENT OF INCOME Year Ended December 31, 1993 PRO FORMA ADJUSTMENTS Increase (Decrease) (in thousands) Interest on new first mortgage bonds @ 8%* $16,000 Amortization of Debt Issuance Expense over 30 years. 67 Interest on new Short-term Debt @ 4%* 703 Interest on retired first mortgage bonds: 9-7/8% Series due 8/1/2020 $ 50,000,000 (4,938) 9.625% Series due 6/1/2021 50,000,000 (4,813) 8.80% Series due 2/10/2022 50,000,000 (4,400) 8.75% Series due 6/1/2022 50,000,000 (4,375) Amortization of Redemption Premiums over 30 years. 667 Federal Income Taxes @ 35% 381 To reflect the pro forma changes in interest charges associated with the proposed transactions and the related federal income tax effect. * Price assumed solely for the purpose of these Pro Forma Financial Statements. FINANCIAL STATEMENTS PAGE 29 OHIO POWER COMPANY STATEMENT OF INCOME Year Ended December 31, 1993 (in thousands)
Pro Forma Per Books Adjustments Pro Forma --------- ----------- --------- Operating Revenues. . . . . . . . . . . . . . . $1,718,346 $1,718,346 Operating Expenses: Fuel and Purchased Power. . . . . . . . . . . 749,074 749,074 Other Operation . . . . . . . . . . . . . . . 218,793 218,793 Maintenance . . . . . . . . . . . . . . . . . 140,756 140,756 Depreciation and Amortization . . . . . . . . 128,668 128,668 Taxes Other Than Federal Income Taxes . . . . 168,772 168,772 Federal Income Taxes. . . . . . . . . . . . . 64,169 $381 64,550 Total Operating Expenses. . . . . . . . . 1,470,232 381 1,470,613 Operating Income . . . . . . . . . . . . . . . 248,114 (381) 247,733 Nonoperating Income: Equity in Earnings of Subsidiary Companies. . 14,387 14,387 Other . . . . . . . . . . . . . . . . . . . . 16,468 16,468 Total Nonoperating Income (Loss). . . . . 30,855 0 30,855 Income Before Interest Charges. . . . . . . . . 278,969 (381) 278,588 Interest Charges. . . . . . . . . . . . . . . . 93,199 (1,089) 92,110 Preferred Stock Dividend Requirements . . . . . 16,990 16,990 Earnings Applicable to Common Stock . . . . . . $168,780 $708 $169,488 The ProForma Adjustments are shown on Page 28A of these Financial Statements.
FINANCIAL STATEMENTS PAGE 30 OHIO POWER COMPANY STATEMENT OF RETAINED EARNINGS YEAR ENDED DECEMBER 31, 1993 (in thousands) Retained Earnings January 1 . . . . . . . . . $445,955 Net Income. . . . . . . . . . . . . . . . . . 185,770 Deductions: Cash Dividends Declared on Common Stock . . 140,042 Cash Dividends Declared on Cumulative Preferred Stock . . . . . . . . . . . . . 17,141 Other . . . . . . . . . . . . . . . . . . . 42 Retained Earnings December 31 . . . . . . . . $474,500 -----END PRIVACY-ENHANCED MESSAGE-----