-----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, gSO/kvwh2aJvsL6CyaLM5zk/OdS623Th92hPkx1YlL95Av5e+wtUTHjHETKD/F5G he+TL/idI0YD0aehPGbFvQ== 0000074778-94-000027.txt : 19940429 0000074778-94-000027.hdr.sgml : 19940429 ACCESSION NUMBER: 0000074778-94-000027 CONFORMED SUBMISSION TYPE: DEFA14A PUBLIC DOCUMENT COUNT: 1 FILED AS OF DATE: 19940428 FILER: COMPANY DATA: COMPANY CONFORMED NAME: ORANGE & ROCKLAND UTILITIES INC CENTRAL INDEX KEY: 0000074778 STANDARD INDUSTRIAL CLASSIFICATION: 4931 IRS NUMBER: 131727729 STATE OF INCORPORATION: NY FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: DEFA14A SEC ACT: 1934 Act SEC FILE NUMBER: 001-04315 FILM NUMBER: 94524854 BUSINESS ADDRESS: STREET 1: ONE BLUE HILL PLZ CITY: PEARL RIVER STATE: NY ZIP: 10965 BUSINESS PHONE: 9143526000 MAIL ADDRESS: STREET 1: ONE BLUE HILL PLAZA CITY: PEARL RIVER STATE: NY ZIP: 10965 FORMER COMPANY: FORMER CONFORMED NAME: ROCKLAND LIGHT & POWER CO DATE OF NAME CHANGE: 19681202 DEFA14A 1 04/28/94 DEFINITIVE ADDITIONAL PROXY MATERIAL SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 SCHEDULE 14A INFORMATION Proxy Statement Pursuant To Section 14(A) Of The Securities Exchange Act Of 1934 (Amendment No. ) Filed by the Registrant /X/ Filed by a Party other than the Registrant / / Check the appropriate box: / / Preliminary Proxy Statement / / Definitive Proxy Statement /x/ Definitive Additional Materials / / Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12 ORANGE AND ROCKLAND UTILITIES, INC. - ----------------------------------------------------------------- (Name of Registrant as Specified In Its Charter) ORANGE AND ROCKLAND UTILITIES, INC. - ----------------------------------------------------------------- (Name of Person(s) Filing Proxy Statement) Payment of filing fee (Check the appropriate box): / / $125 per Exchange Act Rule 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(j)(2). / / $500 per each party to the controversy pursuant to Exchange Act Rule 14a-6(i)(3). / / Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11. (1) Title of each class of securities to which transaction applies: - ----------------------------------------------------------------- (2) Aggregate number of securities to which transaction applies: - ----------------------------------------------------------------- (3) Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11:/1 - ----------------------------------------------------------------- (4) Proposed maximum aggregate value of transaction: - ----------------------------------------------------------------- / / Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the form or schedule and the date of its filing. (1) Amount previously paid: - ----------------------------------------------------------------- (2) Form, Schedule or Registration Statement No.: - ----------------------------------------------------------------- (3) Filing party: - ----------------------------------------------------------------- (4) Date filed: - ----------------------------------------------------------------- - --------------- /1 Set forth the amount on which the filing fee is calculated and state how it was determined. O&R Orange and Rockland Utilities, Inc. 1 First Quarter Report 1994 Dear Shareholders: I am pleased to enclose for shareholders of record on April 18, 1994, the quarterly dividend check for 63 cents per share of common stock, payable on May 1, 1994. The current dividend is equivalent to an annual dividend rate of $2.52 per share. This is Orange and Rockland's 332nd consecutive quarterly dividend payment, and it demonstrates the fundamental strength of the Company as it continues to provide shareholders with 83 years of uninterrupted investment income. Holders of Series A preferred and preference stock will be paid their dividends on May 1 and May 2, respectively. If you are a participant in the Company's Dividend Reinvestment and Stock Purchase Plan, your dividend payments have been applied directly to your account. Net Income The Company's net income from electric, natural gas and diversified activities during the first quarter of 1994 was $14.1 million, or $.98 per share, compared with $15.1 million, or $1.05 per share, in 1993. These results reflect the expenses associated with the continuing investigation and litigation described below. The costs were offset in part by the improved operating results of the Company's gas marketing subsidiary and higher utility gas sales as compared with the same period a year ago. Electric Revenues As a result of the unusually cold first quarter, total sales of electric energy to retail customers during the period were 1,086,738 megawatt hours (Mwh), compared with 1,051,758 Mwh during the same period a year ago. During the bitterly stormy first quarter, winter peak demand for electricity hit a record high, and, unlike several other utilities in the region which were forced to implement rolling blackouts, Orange and Rockland's service was uninterrupted by the heavy demand. Electric revenues associated with these sales -- after accounting for the effect of the Company's revenue decoupling mechanism agreement -- were $110.8 million, compared with $108.4 million for the first quarter of 1993. Under the Company's RDM agreement, New York electric revenue targets are established in a base rate case, and any revenue below or above the target is recovered from -- or returned to -- customers. The Company's electric revenues therefore reflect New York's RDM sales forecast and demand-side management incentives. However, because the Company's New Jersey and Pennsylvania electric sales are not governed by a revenue decoupling mechanism, results in those states are affected by weather-related sales. First quarter 1994 revenues from sales to other utilities amounted to $3.1 million, versus $1.7 million a year ago. Sales to these utilities totaled 104,512 Mwh, compared with 59,856 Mwh in the first quarter of 1993. Because revenues from these sales are primarily a recovery of costs in accordance with applicable tariff regulations, they have little impact on the Company's annual earnings. Gas Revenues Gas sales to firm customers during the first quarter of 1994 totaled 10,528 million cubic feet (Mmcf), compared with 9,674 Mmcf during the same period a year ago. Gas revenues for the first quarter were $77.5 million, compared with $67.9 million in the first quarter of 1993. This increase reflects higher sales associated with the unusually cold winter weather than experienced during the same period a year ago. As in the case with electric energy, winter gas demand, too, broke previous records on several occasions, and hit an all-time high of 191.3 million cubic feet during the quarter while customers were provided with uninterrupted service. Utility Expenses For the first quarter of 1994, the costs of fuel, purchased power, gas purchased for resale and reconcilable demand-side management costs were $91.6 million, compared with $81.1 million a year ago. Other expenses amounted to $96.3 million during the first quarter, compared with $91.3 million in 1993, primarily reflecting the increase in maintenance costs, taxes and the legal and accounting expenses associated with the ongoing investigation. These increases were somewhat offset by lower operating interest costs. Diversified Activities Sales from diversified activities -- almost entirely the result of the Company's gas marketing subsidiary -- were $97.0 million in the first quarter of 1994, compared with $82.4 million in the prior year. These results reflect the subsidiary's success in adding customers and increasing its sales volume. While the gas marketing subsidiary made a modest contribution to earnings during the first quarter, its business is characterized by an extremely competitive market and narrow profit margins, and future results cannot be predicted from this quarter's achievements. Update on Recent Events Since I last reported to shareholders on the investigation being conducted by the Special Committee of the Board of Directors, James F. Smith, the Company's former chairman and chief executive officer, was indicted on eight felony counts of grand larceny and two misdemeanor counts of petit larceny as a result of an investigation conducted by the Rockland County District Attorney. The charges involve allegations very similar to claims made in the Company's civil suit brought against Mr. Smith following his dismissal for cause. Mr. Smith has pleaded not guilty to the criminal charges and is contesting the civil suit. During the course of the Special Committee's investigation, the financial controls area came under especially rigorous scrutiny, and during the first quarter two officers of the Company with controller responsibilities at one time or another were dismissed. While additional investigation and litigation expenses will be incurred during the second quarter of 1994, the investigation is drawing to a conclusion and a full report is scheduled to be released by the Special Committee on or about May 31, 1994. Litigation related to the suits brought by the Company to recover misappropriated funds and against the Company by some shareholders and customers is continuing. Cost-Reduction Measures In order to further enhance our ability to meet the competitive challenges in the years ahead, and to offset some of the expenses associated with the special investigation and litigation, management accelerated its cost-reduction program during the first quarter of 1994. As a result of this effort, the Company's 1994 budget has been reduced by $5.7 million. The cost reductions will not diminish the Company's operating ability and the quality of our service will be unimpaired. We will continue to aggressively pursue other avenues of cost reduction. A Look Ahead I continue to be confident that by applying the lessons learned from the events of the past year -- events now nearly behind us -- Orange and Rockland will emerge this year as an even stronger Company. Those lessons, coupled with the fundamentals already in place, will enable us to even better achieve our mission for customers and shareholders. /s/ Victor J. Blanchet, Jr. President, Chief Operating Officer and Acting Chief Executive Officer May 1, 1994 FINANCIAL HIGHLIGHTS Orange and Rockland Utilities, Inc. and Subsidiaries
1994 1993 % Change There Months Ended March 31, (Thousands of Dollars) Operating Revenues $ 292,675 $ 264,030 10.8 Operating Income $ 24,165 $ 23,731 1.8 Net Income $ 14,068 $ 15,084 (6.7) Earnings per Average Common Share $ 0.98 $ 1.05 (6.7) Electric Sales to Ultimate Customers(Mwh) 1,086,738 1,051,758 3.3 Electric Sales to Other Utilities(Mwh) 104,512 59,856 74.6 Gas Sales to Firm Customers(Mmcf) 10,528 9,674 8.8
Twelve Months Ended March 31, 1994 1993 % Change (Thousands of Dollars) Operating Revenues $ 1,000,016 $ 868,096 15.2 Operating Income $ 82,967 $ 82,992 - Net Income $ 43,799 $ 48,850 (10.3) Earnings per Average Common Share $ 2.99 $ 3.37 (11.3) Electric Sales to Ultimate Customers(Mwh) 4,392,508 4,231,037 3.8 Electric Sales to Other Utilities(Mwh) 279,408 253,788 10.1 Gas Sales to Firm Customers(Mmcf) 21,410 21,053 1.7
Twelve Months Ended March 31, 1994 1993 Selected Financial Ratios: Dividends Declared* $ 2.51 $ 2.45 Return on Average Common Equity 10.85% 12.58% Ratio of Earnings to Fixed Charges(Times) 3.02 3.08 Dividend Payout Ratio 83.95% 72.70% Book Value per Common Share $ 28.14 $ 27.65 *At the current rate of 63.0 cents per share, this is equivalent to $2.52 on an annual basis.
CONSOLIDATED COMPARATIVE INCOME STATEMENTS Orange and Rockland Utilities, Inc. and Subsidiaries
Three Months Twelve Months Ended March 31, Ended March 31, 1994 1993 1994 1993 (Thousands of Dollars) Operating Revenues: Electric $111,146 $109,156 $482,543 $461,042 Gas 81,403 70,782 167,878 152,112 Electric sales to other utilities 3,141 1,740 7,815 6,933 ------- ------- ------- ------- Total Utility Revenues 195,690 181,678 658,236 620,087 Diversified activities 96,985 82,352 341,780 248,009 ------- ------- ------- ------- Total Operating Revenues 292,675 264,030 1,000,016 868,096 Operating Expenses: ------- ------- ------- ------- Operations: Fuel used in electric production 25,055 16,298 83,237 78,408 Electricity purchased for resale 10,972 17,225 56,716 55,074 Gas purchased for resale 50,166 41,997 98,153 86,500 Non-Utility gas marketing purchases 91,075 78,418 323,124 233,540 Other expenses of operation 37,467 36,975 154,565 141,278 Maintenance 10,072 9,057 43,876 40,895 Depreciation and amortization 8,711 8,476 34,755 34,102 Taxes other than income taxes 26,155 24,404 95,366 91,241 Federal income taxes 8,837 7,449 27,257 24,066 ------- ------- ------- ------- Total Operating Expenses 268,510 240,299 917,049 785,104 ------- ------- ------- ------- Income From Operations 24,165 23,731 82,967 82,922 ------- ------- ------- ------- Other Income and Deductions: Allowance for other funds used during construction 30 (1) 71 334 Investigation costs (3,212) - (9,351) - Other--net 399 (189) (349) (116) Taxes other than income taxes (26) (27) (93) (101) Federal income taxes 1,219 358 4,386 1,253 ------- ------- ------- ------- Total Other Income and Deductions (1,590) 141 (5,336) 1,370 ------- ------- ------- ------- Income Before Interest Charges 22,575 23,872 77,631 84,362 ------- ------- ------- ------- Interest Charges: Interest on long-term debt 7,492 7,885 29,991 32,045 Other interest 796 717 2,928 2,955 Amortization of debt premium and expense--net 301 218 1,199 504 Allowance for borrowed funds used during construction (82) (32) (286) 8 ------- ------- ------- ------- Total Interest Charges 8,507 8,788 33,832 35,512 ------- ------- ------- ------- Net Income 14,068 15,084 43,799 48,850 Dividends on preferred and preference stock, at required rates 813 841 3,336 3,449 ------- ------- ------- ------- Earnings applicable to common stock $13,255 $14,243 $40,463 $45,401 ======= ======= ======= ======= Average number of common shares outstanding(000's) 13,532 13,531 13,532 13,481 ======= ======= ======= ======= Earnings per average common share outstanding $0.98 $1.05 $2.99 $3.37 ======= ======= ======= ======= This is an interim statement of income and should not be taken as a basis for predicting results for the calendar year.
CONSOLIDATED BALANCE SHEETS Orange and Rockland Utilities, Inc. and Subsidiaries
March 31, 1994 1993 (Thousands of Dollars) Assets Utility Plant: Electric $935,099 $909,285 Gas 190,430 179,675 Common 52,570 50,368 --------- --------- 1,178,099 1,139,328 Less accumulated depreciation 380,203 355,680 --------- --------- 797,896 783,648 Construction work in --------- --------- progress 31,675 28,098 --------- --------- Net Utility Plant 829,571 811,746 --------- --------- Nonutility Property(Net) 21,856 22,028 --------- --------- Current Assets: Cash and Cash Equivalents 4,752 25,963 Other 247,439 210,296 --------- --------- Total Current Assets 252,191 236,259 --------- --------- Deferred Debits: Extraordinary property loss Sterling nuclear project 14,146 18,678 Other deferred debits 165,103 141,362 --------- --------- Total Deferred Debits 179,249 160,040 --------- --------- Total $1,282,867 $1,230,073 ========== ========== Capitalization and Liabilities: Capitalization: Common stock $67,662 $67,657 Premium on capital stock 130,320 130,301 Capital stock expense (6,107) (6,092) Retained earnings 188,908 182,343 --------- --------- Total Common Stock Equity 380,783 374,209 --------- --------- Non-redeemable preferred stock 42,844 42,844 Non-redeemable preference stock 434 459 --------- --------- Total Non-Redeemable Stock 43,278 43,303 --------- --------- Redeemable preferred stock 4,158 5,542 --------- --------- Long-term debt 380,093 380,972 --------- --------- Total Capitalization 808,312 804,026 --------- --------- Noncurrent Liabilities 49,341 35,818 --------- --------- Current Liabilities: Long-term debt due within one year 2,863 2,622 Commercial paper 39,350 41,250 Other current liabilities 157,355 150,002 --------- --------- Total Current Liabilities 199,568 193,874 --------- --------- Deferred Taxes and Other: Deferred Federal income taxes 170,100 162,799 Other Deferred Credits 55,546 33,556 --------- --------- Total Deferred Taxes and Other 225,646 196,355 --------- --------- Total $1,282,867 $1,230,073 ========== ========== Note: All figures reported are subject to such adjustments as the annual audit by independent accounts may disclose to be necessary.
Figures appearing in this report are presented as general information and not in connection with any sale or offer to sell or solicitation of an offer to buy any securities. All figures reported are subject to such adjustments as the annual audit by independent accountants may disclose to be necessary. ORANGE AND ROCKLAND Orange and Rockland Utilities, Inc. and Subsidiaries One Blue Hill Plaza Pearl River, NY 10965 -----END PRIVACY-ENHANCED MESSAGE-----