SCHEDULE I - CONDENSED FINANCIAL INFORMATION OF REGISTRANT

12 Months Ended

Dec. 31, 2011

SCHEDULE I - CONDENSED FINANCIAL INFORMATION OF REGISTRANT

PINNACLE WEST CAPITAL CORPORATION HOLDING COMPANY

SCHEDULE I — CONDENSED FINANCIAL INFORMATION OF REGISTRANT

CONDENSED STATEMENTS OF INCOME

(in thousands)

	Year Ended December 31,
	2011			2010			2009
Operating revenues	$	1,034		$	2,810		$	1,157
Operating expenses	8,811			9,880			10,420
Operating loss	(7,777		)	(7,070		)	(9,263		)
Other
Equity in earnings (losses) ofsubsidiaries	335,859			358,527			(37,214		)
Other income (expense)	(1,481		)	(588		)	2,102
Total	334,378			357,939			(35,112		)
Interest expense	8,053			14,346			14,129
Income (loss) from continuing operations	318,548			336,523			(58,504		)
Income tax benefit	(8,938		)	(9,596		)	(14,060		)
Income (loss) from continuing operations —net of income taxes	327,486			346,119			(44,444		)
Income from discontinued operations —net of income taxes	11,987			3,934			112,774
Net income attributable to common shareholders	$	339,473		$	350,053		$	68,330

See Notes to Pinnacle West’s Consolidated Financial Statements.

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PINNACLE WEST CAPITAL CORPORATION HOLDING COMPANY

SCHEDULE I — CONDENSED FINANCIAL INFORMATION OF REGISTRANT

CONDENSED BALANCE SHEETS

(in thousands)

	Balance at December 31,
	2011			2010
ASSETS
Current assets
Cash and cash equivalents	$	12,710		$	7,725
Customer and other receivables	62,418			75,745
Current deferred income taxes	19,068			19,855
Income tax receivable	1,804			3,736
Other current assets	55			61
Total current assets	96,055			107,122
Investments and other assets
Investments in subsidiaries	4,026,289			3,901,935
Deferred income taxes	27,220			—
Other assets	16,898			58,071
Total investments and other assets	4,070,407			3,960,006
Total Assets	$	4,166,462		$	4,067,128
LIABILITIES AND EQUITY
Current liabilities
Accounts payable	$	4,811		$	4,981
Accrued taxes	9,795			4,216
Short-term borrowings	—			16,600
Current maturities of long-term debt	—			175,000
Other current liabilities	28,295			28,101
Total current liabilities	42,901			228,898
Long-term debt less current maturities	125,000			—
Deferred credits and other
Pension and other postretirement liabilities	32,513			28,607
Other	35,462			34,397
Total deferred credits and other	67,975			63,004
Common stock equity
Common stock	2,439,530			2,419,133
Accumulated other comprehensive loss	(152,163		)	(159,767		)
Retained earnings	1,534,483			1,423,961
Total Pinnacle West Shareholders’ equity	3,821,850			3,683,327
Noncontrolling interests	108,736			91,899
Total Equity	3,930,586			3,775,226
Total Liabilities and Equity	$	4,166,462		$	4,067,128

See Notes to Pinnacle West’s Consolidated Financial Statements.

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PINNACLE WEST CAPITAL CORPORATION HOLDING COMPANY

SCHEDULE I — CONDENSED FINANCIAL INFORMATION OF REGISTRANT

CONDENSED STATEMENTS OF CASH FLOWS

(in thousands)

	Year Ended December 31,
	2011			2010			2009
Cash flows from operating activities
Net income	$	339,473		$	350,053		$	68,330
Adjustments to reconcile net income to netcash provided by operating activities:
Equity in earnings of subsidiaries — net	(335,859		)	(358,527		)	37,214
Depreciation and amortization	97			143			127
Gain on sale of energy-related business	(10,404		)	—			—
Deferred income taxes	7,387			40,342			(106,536		)
Customer and other receivables	(24,201		)	(18,175		)	(2,303		)
Accounts payable	(2,677		)	7,468			466
Accrued taxes and income tax receivables — net	7,512			59,640			44,625
Dividends received from subsidiaries	228,900			207,000			170,000
Other net	19,270			423			(2,379		)
Net cash flow provided by operating activities	229,498			288,367			209,544
Cash flows from investing activities
Investments in subsidiaries	—			(183,544		)	(4,967		)
Repayments of loans from subsidiaries	61,143			98,406			25,240
Proceeds from sale of energy-related productsand services business	45,111			—			—
Advances of loans to subsidiaries	(64,970		)	(119,293		)	(21,587		)
Proceeds from sale of life insurance policies	9,357			—			—
Net cash flow provided by (used for)investing activities	50,641			(204,431		)	(1,314		)
Cash flows from financing activities
Issuance of long-term debt	175,000			—			—
Short-term borrowings and payments — net	(16,600		)	(132,487		)	4,566
Dividends paid on common stock	(221,728		)	(216,979		)	(205,076		)
Repayment of long-term debt	(225,000		)	—			—
Common stock equity issuance	15,841			255,971			3,302
Other	(2,667		)	—			—
Net cash flow used for financing activities	(275,154		)	(93,495		)	(197,208		)
Net increase (decrease) in cash and cash equivalents	4,985			(9,559		)	11,022
Cash and cash equivalents at beginning of year	7,725			17,284			6,262
Cash and cash equivalents at end of year	$	12,710		$	7,725		$	17,284

See Notes to Pinnacle West’s Consolidated Financial Statements.