-----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, GVz/Oqzsl/+Xvw/OBA0v9ph3TPG2Sq8P9Lhn+VzXTlgp9KN1xWe4HsognWBY5TMY m4va1oOPuUF5dKbCAP5XBA== 0000075594-94-000016.txt : 19941111 0000075594-94-000016.hdr.sgml : 19941111 ACCESSION NUMBER: 0000075594-94-000016 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 5 CONFORMED PERIOD OF REPORT: 19940930 FILED AS OF DATE: 19941110 SROS: NYSE SROS: PSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: PACIFICORP /OR/ CENTRAL INDEX KEY: 0000075594 STANDARD INDUSTRIAL CLASSIFICATION: 4931 IRS NUMBER: 930246090 STATE OF INCORPORATION: OR FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-05152 FILM NUMBER: 94558701 BUSINESS ADDRESS: STREET 1: 700 NE MULTNOMAH STE 1600 CITY: PORTLAND STATE: OR ZIP: 97232 BUSINESS PHONE: 5037312000 FORMER COMPANY: FORMER CONFORMED NAME: PACIFICORP /ME/ DATE OF NAME CHANGE: 19890628 FORMER COMPANY: FORMER CONFORMED NAME: PC/UP&L MERGING CORP DATE OF NAME CHANGE: 19890628 10-Q 1 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, 1994 __________________ OR / / TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _______________ to _______________ Commission file number 1-5152 ______ PACIFICORP (Exact name of registrant as specified in its charter) STATE OF OREGON 93-0246090 (State or other jurisdiction (I.R.S. Employer of incorporation or organization) Identification No.) 700 N.E. Multnomah Suite 1600 Portland, Oregon 97232-4116 (Address of principal executive offices) (Zip code) 503-731-2000 (Registrant's telephone number) Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding twelve months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for at least the past 90 days. YES X NO _____ _____ At October 31, 1994, there were 284,251,024 shares of registrant's common stock outstanding. PACIFICORP Page No. ________ PART I. FINANCIAL INFORMATION 2 Item 1. Financial Statements 2 Condensed Consolidated Statements of Income and Retained Earnings 2 Condensed Consolidated Balance Sheets 3 Condensed Consolidated Statements of Cash Flows 5 Notes to Condensed Consolidated Financial Statements 7 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 9 PART II. OTHER INFORMATION 22 Item 1. Legal Proceedings 22 Item 5. Other Information 22 Item 6. Exhibits and Reports on Form 8-K 23 Signature 24 - 1 - PART I. FINANCIAL INFORMATION Item 1. Financial Statements PACIFICORP CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND RETAINED EARNINGS (Millions of Dollars, except per share amounts) (Unaudited)
Three Months Ended Nine Months Ended September 30, September 30, ___________________ __________________ 1994 1993 1994 1993 ______ ______ ______ ______ REVENUES $ 915.0 $ 860.1 $2,616.4 $2,528.1 _______ _______ _______ _______ EXPENSES Operations 363.1 335.8 1,041.7 991.4 Maintenance 70.1 72.2 219.4 217.5 Administrative and general 72.7 64.8 195.2 192.6 Depreciation and amortization 105.3 103.2 323.0 302.1 Taxes, other than income taxes 31.9 31.7 95.5 96.5 Financial Services' interest expense 6.5 14.0 23.5 44.5 _______ _______ _______ _______ TOTAL 649.6 621.7 1,898.3 1,844.6 _______ _______ _______ _______ INCOME FROM OPERATIONS 265.4 238.4 718.1 683.5 _______ _______ _______ _______ INTEREST EXPENSE AND OTHER Interest expense 76.1 79.5 226.8 251.4 Interest capitalized (3.3) (2.7) (10.9) (9.0) Minority interest and other (11.2) 1.8 (22.8) (12.0) _______ _______ _______ _______ TOTAL 61.6 78.6 193.1 230.4 _______ _______ _______ _______ Income from continuing operations before income taxes 203.8 159.8 525.0 453.1 Income taxes 72.0 54.6 183.4 143.5 _______ _______ _______ _______ INCOME FROM CONTINUING OPERATIONS BEFORE CUMULATIVE EFFECT OF CHANGE IN ACCOUNTING PRINCIPLE 131.8 105.2 341.6 309.6 Discontinued operations (less applicable income tax expense of $26.0) - 52.4 - 52.4 Cumulative effect of change in accounting for income taxes - - - 4.0 _______ _______ _______ _______ NET INCOME 131.8 157.6 341.6 366.0 RETAINED EARNINGS BEGINNING OF PERIOD 389.0 251.2 351.3 210.4 Cash dividends declared Preferred stock (9.8) (9.7) (29.6) (29.7) Common stock per share: 1994 and 1993/$.27 and $.81 (76.7) (73.8) (229.0) (221.4) _______ _______ _______ _______ RETAINED EARNINGS END OF PERIOD $ 434.3 $ 325.3 $ 434.3 $ 325.3 _______ _______ _______ _______ _______ _______ _______ _______ EARNINGS ON COMMON STOCK (Net income less preferred dividend requirement) $ 121.8 $ 147.8 $ 311.9 $ 336.5 Average number of common shares outstanding (Thousands) 283,503 273,818 282,473 272,514 EARNINGS PER COMMON SHARE Continuing operations $ .43 $ .35 $ 1.10 $ 1.03 Discontinued operations - .19 - .19 Cumulative effect on prior years of change in accounting for income taxes - - - .01 _______ _______ _______ _______ TOTAL $ .43 $ .54 $ 1.10 $ 1.23 _______ _______ _______ _______ _______ _______ _______ _______ See accompanying Notes to Condensed Consolidated Financial Statements
- 2 - PACIFICORP CONDENSED CONSOLIDATED BALANCE SHEETS (Millions of Dollars) (Unaudited) ASSETS
September 30, December 31, 1994 1993 ____________ ____________ PROPERTY, PLANT AND EQUIPMENT Electric $10,427.2 $10,000.6 Telecommunications 1,609.3 1,649.9 Other 63.2 65.8 Accumulated depreciation and amortization (4,088.4) (3,863.5) ________ ________ Net 8,011.3 7,852.8 Construction work in progress 383.8 356.8 ________ ________ TOTAL PROPERTY, PLANT AND EQUIPMENT 8,395.1 8,209.6 ________ ________ CURRENT ASSETS Cash and cash equivalents 21.2 31.2 Accounts receivable less allowance for doubtful accounts: 1994/$9.1 and 1993/$8.2 438.1 451.0 Materials, supplies and fuel stock at average cost 198.4 203.2 Inventory 65.4 70.1 Finance assets 76.6 118.7 Other 51.3 80.5 ________ ________ TOTAL CURRENT ASSETS 851.0 954.7 ________ ________ OTHER ASSETS Investments in and advances to affiliated companies 238.3 240.5 Cost in excess of net assets of businesses acquired 171.8 171.1 Regulatory assets - net 1,011.1 974.9 Finance note receivable 221.2 223.3 Finance assets 502.8 561.4 Real estate investments 170.4 303.7 Deferred charges and other 307.5 319.9 ________ ________ TOTAL OTHER ASSETS 2,623.1 2,794.8 ________ ________ TOTAL ASSETS $11,869.2 $11,959.1 ________ ________ ________ ________ See accompanying Notes to Condensed Consolidated Financial Statements
- 3 - PACIFICORP CONDENSED CONSOLIDATED BALANCE SHEETS (Millions of Dollars) (Unaudited) CAPITALIZATION AND LIABILITIES
September 30, December 31, 1994 1993 ____________ ____________ COMMON EQUITY Common shareholder capital shares authorized 750,000,000; shares outstanding: 1994/284,049,755 and 1993/281,020,717 $ 3,005.8 $ 2,953.4 Retained earnings 434.3 351.3 Guarantees of Employee Stock Ownership Plan borrowings (28.9) (42.1) ________ ________ TOTAL COMMON EQUITY 3,411.2 3,262.6 ________ ________ PREFERRED STOCK 367.4 367.4 ________ ________ PREFERRED STOCK SUBJECT TO MANDATORY REDEMPTION 219.0 219.0 ________ ________ LONG-TERM DEBT AND CAPITAL LEASE OBLIGATIONS 3,800.0 3,923.6 ________ ________ CURRENT LIABILITIES Long-term debt and capital lease obligations currently maturing 105.0 155.6 Notes payable and commercial paper 477.9 553.5 Accounts payable 282.7 360.5 Taxes, interest and dividends payable 337.1 252.5 Customer deposits and other 120.5 121.2 ________ ________ TOTAL CURRENT LIABILITIES 1,323.2 1,443.3 ________ ________ DEFERRED CREDITS Income taxes 1,812.4 1,833.3 Investment tax credits 192.5 200.0 Other 636.3 605.7 ________ ________ TOTAL DEFERRED CREDITS 2,641.2 2,639.0 ________ ________ MINORITY INTEREST 107.2 104.2 ________ ________ CONTINGENCIES (See Note 2) TOTAL CAPITALIZATION AND LIABILITIES $11,869.2 $11,959.1 ________ ________ ________ ________ See accompanying Notes to Condensed Consolidated Financial Statements
- 4 - PACIFICORP CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Millions of Dollars) (Unaudited)
Nine Months Ended September 30, _______________________ 1994 1993 ______ ______ CASH FLOWS FROM OPERATING ACTIVITIES Income from continuing operations $ 341.6 $ 309.6 Adjustments to reconcile income from continuing operations to net cash provided by operating activities Depreciation and amortization 352.6 334.8 Deferred income taxes and investment tax credits - net (29.0) 59.8 Interest capitalized on equity funds (1.5) (2.5) Minority interest and other 34.2 46.7 Accounts receivable and prepayments 34.7 41.1 Materials, supplies, fuel stock and inventory 9.4 18.7 Accounts payable and accrued liabilities 20.4 17.7 ______ ______ NET CASH PROVIDED BY OPERATING ACTIVITIES 762.4 825.9 ______ ______ CASH FLOWS FROM INVESTING ACTIVITIES Construction (556.4) (496.9) Proceeds from sales of assets 103.0 388.9 Investment in finance note - (225.0) Proceeds from sales of finance assets and principal payments 134.6 131.8 Proceeds from Alaska restructuring 75.0 - Other (53.8) (8.7) ______ ______ NET CASH USED IN INVESTING ACTIVITIES (297.6) (209.9) ______ ______ See accompanying Notes to Condensed Consolidated Financial Statements
- 5 - PACIFICORP CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Millions of Dollars) (Unaudited)
Nine Months Ended September 30, _______________________ 1994 1993 ______ ______ CASH FLOWS FROM FINANCING ACTIVITIES Changes in short-term debt (75.6) (591.2) Proceeds from long-term debt 13.7 929.8 Proceeds from issuance of common stock 52.4 182.9 Dividends paid (258.1) (281.2) Repayments of long-term debt and capital lease obligations (174.3) (665.5) Redemptions of preferred stock - (50.0) Other (32.9) (26.3) ______ ______ NET CASH USED BY FINANCING ACTIVITIES (474.8) (501.5) ______ ______ INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS (10.0) 114.5 CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 31.2 50.2 ______ ______ CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 21.2 $ 164.7 ______ ______ ______ ______ SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION Cash paid during the period for Interest $ 308.4 $ 347.8 Income taxes net of refunds 145.9 89.6 Noncash investing activity IDB common stock received in the sale of TRT Communications - 201.0 See accompanying Notes to Condensed Consolidated Financial Statements
- 6 - NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) September 30, 1994 1. FINANCIAL STATEMENTS The accompanying unaudited condensed consolidated financial statements as of September 30, 1994 and for the periods ended September 30, 1994 and 1993, in the opinion of management, include all adjustments, constituting only normal recording of accruals, necessary for a fair presentation of financial position, results of operations and cash flows for such periods. A significant part of the business of PacifiCorp (the "Company") is of a seasonal nature; therefore, results of operations for the period ended September 30, 1994 are not necessarily indicative of the results for a full year. These condensed consolidated financial statements should be read in conjunction with the financial statements and related notes incorporated by reference in the Company's 1993 Annual Report on Form 10-K. The condensed consolidated financial statements of the Company encompass two businesses primarily of a utility nature -- Electric Operations (Pacific Power and Utah Power) and an 87%-owned Telecommunications operation (Pacific Telecom, Inc.); and a wholly owned Financial Services business (PacifiCorp Financial Services, Inc.). The Company's wholly owned subsidiary, PacifiCorp Holdings, Inc. ("Holdings"), holds all of its nonelectric utility investments. Together these businesses are referred to herein as the Companies. Significant intercompany transactions and balances have been eliminated. See Part II, Item 5. "Other Information" on page 22 of this Form 10-Q for information regarding a proposal by Holdings to acquire the 13% publicly held minority interest of Pacific Telecom, Inc. Investments in and advances to affiliated companies represent investments in unconsolidated affiliated companies carried on the equity basis, which approximates the Company's equity in their underlying net book value. Certain amounts from the prior period have been reclassified to conform with the 1994 method of presentation. These reclassifications had no effect on previously reported consolidated net income. 2. CONTINGENT LIABILITIES The Company and its subsidiaries are parties to various legal claims, actions and complaints, certain of which involve material amounts. Although the Company is unable to predict with certainty whether or not it will ultimately be successful in these legal proceedings or, if not, what the impact might be, management presently believes that disposition of these matters will not have a materially adverse effect on the Company's consolidated results of operations. The Internal Revenue Service ("IRS") has completed its examination of the Company's federal income tax returns for the years 1983 through 1986. The Company and the IRS have agreed to a settlement on all of the issues, except for certain matters relating to the Company's abandonment of its 10% - 7 - interest in Washington Public Power Supply System Unit 3. The Company and the IRS continue to discuss the remaining unagreed issue. During 1993, the IRS completed its examination of the Company's federal income tax returns for 1987 and 1988, and has proposed certain adjustments increasing taxes by $26 million. The Company has appealed adjustments totaling more than the net proposed increased tax. Conferences with the IRS are ongoing in 1994. In the opinion of management, the outcome of the 1983 through 1988 federal income tax examinations will not have a material effect on the Company's consolidated financial position or results of operations. The Company's 1989 and 1990 federal income tax returns are currently under examination by the IRS. Several Superfund sites have been identified where the Company has been or may be designated as a potentially responsible party. Future costs associated with the disposition of these matters are not expected to be material to the Company's consolidated results of operations. - 8 - Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS SUMMARY RESULTS OF OPERATIONS
Nine Months Percentage Ended Percentage Third Quarter Increase/ September 30, Increase/ ________________ _______________ 1994 1993 (Decrease) 1994 1993 (Decrease) ____ ____ __________ ____ ____ __________ (Dollars in Millions, except per share) Revenues $ 915.0 $ 860.1 6% $2,616.4 $2,528.1 3% _______ ______ _______ _______ Income from operations 265.4 238.4 11 718.1 683.5 5 _______ ______ _______ _______ Net income 131.8 157.6 (16) 341.6 366.0 (7) _______ ______ _______ _______ Earnings contribution on common stock Continuing operations Electric Operations 87.4 78.4 11 233.2 235.4 (1) Telecommunications 25.7 12.2 111 54.6 36.0 52 Other 8.7 4.8 81 24.1 8.7 * _______ ______ _______ _______ Total 121.8 95.4 28 311.9 280.1 11 Discontinued operations - 52.4 * - 52.4 * Cumulative effect of change in accounting for income taxes - - - - 4.0 * _______ ______ _______ _______ Total $ 121.8 $ 147.8 (18) $ 311.9 $ 336.5 (7) _______ ______ _______ _______ _______ ______ _______ _______ Earnings per common share Continuing operations $ .43 $ .35 23 $ 1.10 $ 1.03 7 Discontinued operations - .19 * - .19 * Cumulative effect of change in accounting for income taxes - - - - .01 * _______ ______ _______ _______ Total $ .43 $ .54 (20) $ 1.10 $ 1.23 (11) _______ ______ _______ _______ _______ ______ _______ _______ Average number of common shares outstanding (thousands) 283,503 273,818 4 282,473 272,514 4 *Not a meaningful number. (1) Earnings contribution on common stock by segment: (a) does not reflect elimination for interest on intercompany borrowing arrangements; (b) includes income taxes on a separate company basis, with any benefit or detriment of consolidation reflected in Other; (c) amounts are net of preferred dividend requirements and minority interest. (2) Represents the Company's interest in an international communications subsidiary. (3) Represents the net effect on prior years of the adoption of Statement of Financial Accounting Standards 109, "Accounting for Income Taxes."
Comparison of the third quarters of 1994 and 1993. _________________________________________________ . Earnings contribution on common stock decreased $26 million or 18%. .. Electric Operations' earnings contribution increased $9 million or 11% primarily due to the effects in 1994 of warmer summer weather and a gain on the sale of sulfur dioxide emission allowances. - 9 - .. Telecommunications' earnings contribution increased $14 million or 111% primarily due to long lines settlement revenues, customer growth in cellular operations and decreased interest expense. .. The earnings contribution of other businesses increased $4 million or 81% primarily due to the $4 million effect of accruals in 1993 for legal and other corporate expenses. The continued downsizing of Financial Services led to a $17 million decrease in revenues, offset by an $8 million decrease in finance interest expense, a $4 million decrease in other operating expenses and increased income tax benefits. .. Discontinued operations earnings decreased $52 million due to a gain recorded in 1993 relating to the sale of an international communica- tions subsidiary. . The average number of common shares outstanding rose 4% due to the issuance of 6 million shares in a September 1993 public offering and issuances under dividend reinvestment and employee stock ownership plans. Comparison of the nine-month periods ended September 30, 1994 and 1993 ______________________________________________________________________ . Earnings contribution on common stock decreased $25 million or 7%. .. Electric Operations' earnings contribution decreased $2 million or 1% primarily due to the effects in 1994 of a warmer than normal winter heating season, poor hydro conditions in the region and a higher effective income tax rate. .. Telecommunications' earnings contribution increased $19 million or 52% primarily due to long lines settlement revenue, decreased interest expense and customer growth in cellular operations. .. The earnings contribution of other businesses increased $15 million primarily due to a $12 million increase in interest revenue from the note received in connection with the June 1993 sale of NERCO, Inc. The continued downsizing of Financial Services led to a $28 million decrease in revenues, offset by a $21 million decrease in finance interest expense and a $5 million decrease in other operating expenses. .. Discontinued operations earnings decreased $52 million due to a gain recorded in 1993 relating to the sale of an international communica- tions subsidiary. . The average number of common shares outstanding rose 4% due to the same factors described above. - 10 - RESULTS OF OPERATIONS Electric Operations ___________________
Nine Months Percentage Ended Percentage Third Quarter Increase/ September 30, Increase/ ________________ _______________ 1994 1993 (Decrease) 1994 1993 (Decrease) ____ ____ __________ ____ ____ __________ (Dollars in Millions) Revenues Residential $158.1 $139.2 14% $ 511.8 $ 491.1 4% Commercial 147.3 137.1 7 421.6 402.4 5 Industrial 199.0 187.2 6 553.7 521.8 6 Other 8.0 7.6 5 23.1 22.4 3 _____ _____ _______ ________ Retail sales 512.4 471.1 9 1,510.2 1,437.7 5 Wholesale sales 150.6 140.5 7 392.3 381.4 3 Other 16.9 9.9 71 44.1 28.3 56 _____ _____ _______ ________ Total 679.9 621.5 9 1,946.6 1,847.4 5 Operating expenses 472.4 427.6 10 1,364.3 1,268.8 8 _____ _____ _______ ________ Income from operations 207.5 193.9 7 582.3 578.6 1 _____ _____ _______ ________ Net income 97.4 88.2 10 262.9 264.9 (1) Preferred dividend requirement 10.0 9.8 2 29.7 29.5 1 _____ _____ _______ ________ Earnings contribution $ 87.4 $ 78.4 11 $ 233.2 $ 235.4 (1) _____ _____ _______ ________ _____ _____ _______ ________ Energy sales (millions of kWh) Residential 2,604 2,365 10 8,580 8,588 - Commercial 2,828 2,579 10 7,893 7,477 6 Industrial 5,633 5,336 6 15,575 14,791 5 Other 165 151 9 470 453 4 ______ _____ _______ ________ Retail sales 11,230 10,431 8 32,518 31,309 4 Wholesale sales 4,363 4,197 4 11,314 11,311 - ______ _____ _______ ________ Total 15,593 14,628 7 43,832 42,620 3 ______ ______ _______ ________ ______ ______ _______ ________ Residential average usage (kWh) 2,262 2,101 8 7,499 7,667 (2) Total customers (end of period) 1,347,018 1,318,029 2 1,347,018 1,318,029 2
Comparison of the third quarters of 1994 and 1993. _________________________________________________ . Revenues increased $58 million or 9%. .. Residential revenues increased $19 million or 14% primarily due to the $8 million effect of warmer temperatures in 1994, a 2% increase in the number of customers and increased customer usage. In addition, the pass-through of a BPA price increase that was effective in October 1993 increased revenue $4 million. .. Commercial revenues increased $10 million or 7% primarily due to the $5 million effect of warmer temperatures in 1994, a 2% increase in the number of customers and an increase in customer average usage. .. Industrial revenues increased $12 million or 6% due to a 6% increase in kWh volume. Irrigation revenues increased $5 million due to the effects of drier weather in 1994. Revenues from other industrial customers increased $7 million, primarily due to customer growth and increased sales to customers in the paper and pulp and oil and gas industries. .. Wholesale revenues increased $10 million or 7% while energy sales increased 4%. Higher volumes sold in the secondary market and under firm sales contracts added revenue of $5 million and $3 million, - 11 - respectively, and higher prices for these sales increased revenues $2 million. .. Other revenues increased $7 million or 71% primarily due to deferred regulatory revenues and increased rental revenues. . Operating expenses increased $45 million or 10%. .. Fuel expense increased $6 million or 5% due to a 5% increase in thermal generation, primarily resulting from increased kWh sold, and a 27% reduction in hydro generation. .. Purchased power expense increased $23 million or 41% primarily due to a $13 million increase resulting from 32% higher kWh purchases, a $7 million increase due to higher prices, including a $3 million price increase relating to a BPA peaking purchase contract, and a $3 million decrease in BPA exchange benefits. .. Other operations expense increased $6 million or 8% primarily due to $3 million of increased distribution system expenses and $2 million of increased wheeling expense, largely the result of higher volumes wheeled. .. Depreciation and amortization expense increased $6 million or 8% primarily due to additional plant in service. . Earnings contribution increased $9 million or 11%. .. Income from operations increased $14 million or 7%. .. Other income increased $8 million primarily due to state regulatory approval of the recognition of a $9 million gain on the sale of sulphur dioxide emission allowances, which sale occurred in 1993. .. Income tax expense increased $14 million or 33% primarily due to the $9 million effect of higher taxable income and a $5 million reduction in 1993 resulting from an adjustment of 1992 taxes. Comparison of the nine-month periods ended September 30, 1994 and 1993 ______________________________________________________________________ . Revenues increased $99 million or 5%. .. Residential revenues increased $21 million or 4% while kWh volume remained constant. Revenues increased $18 million due to the pass- through of a BPA price increase that was effective in October 1993 and $11 million due to a 2% increase in the number of customers. Unseasonably warm winter temperatures early in the year created a revenue decline which was reduced to $9 million by the effects of continuing warm temperatures, often at record highs, through the summer months. .. Commercial revenues increased $19 million or 5% primarily due to a 2% increase in the number of customers and an increase in customer average usage. - 12 - .. Industrial revenues increased $32 million or 6% primarily due to a 5% increase in kWh volume. Irrigation revenues increased $14 million due to effects of drier weather in 1994. Revenues from other industrial customers increased $18 million due to customer growth and increased sales to customers in the paper and pulp and oil and gas industries. .. Wholesale revenues increased $11 million or 3% while kWh volume remained constant. Firm contract revenue increased $22 million, $13 million from additional volume sold and $9 million from price increases. Secondary sales revenue decreased $12 million due to a 15% reduction in kWh volume and lower prices. The adverse effect of mild weather in early 1994 on secondary sales was reduced but not offset by the effect of warmer summer weather. .. Other revenues increased $16 million or 56% primarily due to increases in rental revenue, deferred regulatory revenue and revenue from sales of timber. . Operating expenses increased $96 million or 8%. .. Fuel expense increased $28 million or 8% due to a 7% increase in thermal generation primarily resulting from increased kWh sales and a 23% decrease in hydro generation. .. Purchased power expense increased $33 million or 17% while kWh volume purchased declined 7%. The increased expense was due to a decrease in BPA exchange benefits of $15 million, a price increase relating to a BPA peaking contract of $8 million, volume and price increases on other firm purchase contracts of $10 million and secondary purchase price increases of $8 million. Partially offsetting these increases was an $8 million decrease in short-term firm and secondary energy purchases primarily due to an 18% reduction in kWh volume purchased. .. Other operations expense increased $13 million or 6% primarily due to a $6 million increase in wheeling expense consisting of: $4 million from increased volumes wheeled and $2 million from a BPA price increase. Customer accounting and service expenses increased $4 million and distribution system expenses increased $1 million. .. Maintenance expense increased $8 million or 6% due to the timing of plant maintenance and start-up costs of $3 million to bring a gas plant back on-line. .. Depreciation and amortization expense increased $15 million or 7% primarily due to additional plant in service. . Earnings contribution decreased $2 million or 1%. .. Income from operations increased $4 million or 1%. .. Other income increased $6 million primarily due to the recognition of a $9 million gain in 1994 on the sale of sulphur dioxide emission allowances, partially offset by a gain of $5 million in 1993 on a property sale. - 13 - .. Interest expense decreased $11 million or 5% due to an $11 million decrease resulting from the effect of refinancing long-term debt during 1993 at lower interest rates and the effect of a $6 million accrual in 1993 for a possible settlement of certain coal issues, partially offset by the $5 million effect of higher levels of short- term debt outstanding at higher interest rates in 1994. .. Income tax expense increased $24 million or 19% primarily due to the $8 million effect of higher taxable income, a $5 million reversal of tax depreciation on vintages previously flowed through to customers, a $5 million reduction in 1993 resulting from an adjustment of 1992 taxes and a nonrecurring 1993 tax benefit of $4 million. - 14 - Telecommunications __________________
Nine Months Percentage Ended Percentage Third Quarter Increase/ September 30, Increase/ ________________ _______________ 1994 1993 (Decrease) 1994 1993 (Decrease) ____ ____ __________ ____ ____ __________ (Dollars in Millions) Revenues Local network service $ 24.7 $ 21.2 17% $ 70.9 $ 60.5 17% Network access service 42.1 45.5 (7) 125.5 134.8 (7) Long distance network service 82.8 67.4 23 208.3 199.6 4 Private line service 14.5 16.6 (13) 43.7 50.2 (13) Sales of cable capacity 1.7 .8 113 4.3 3.3 30 Other 28.7 29.8 (4) 78.1 76.7 2 _____ _____ _____ _____ Total 194.5 181.3 7 530.8 525.1 1 Operating expenses 139.5 144.9 (4) 406.4 422.0 (4) _____ _____ _____ _____ Income from operations 55.0 36.4 51 124.4 103.1 21 _____ _____ _____ _____ Net Income 29.7 14.0 112 63.1 42.2 50 Minority interest and other 4.0 1.8 122 8.5 6.2 37 _____ _____ _____ _____ Earnings contribution $ 25.7 $ 12.2 111 $ 54.6 $ 36.0 52 _____ _____ _____ _____ _____ _____ _____ _____ Telephone access lines (end of period) 414,821 395,147 5 414,821 395,147 5 Long lines originating billed minutes (thousands) 199,488 188,903 6 559,523 536,901 4
See Part II, Item 5. "Other Information" on page 22 of this Form 10-Q for information regarding a proposal by Holdings to acquire the 13% publicly held minority interest of Pacific Telecom. In October 1994, Pacific Telecom signed an agreement to sell the stock of Alascom, Inc. ("Alascom") to AT&T Corp. ("AT&T"), in a transaction providing $365 million in proceeds. Under terms of the agreement, AT&T will pay $290 million in cash for the Alascom stock and for settlement of all past cost study issues. AT&T has also agreed to allow Pacific Telecom to retain the $75 million transition payment made by AT&T to Alascom in July 1994 pursuant to a Federal Communications Commission ("FCC") order. AT&T made a down payment of $30 million to Pacific Telecom upon signing the stock purchase agreement, which would be applied to the final $75 million transition payment required in the FCC order if the transaction failed to close. Pursuant to the FCC order, the first transition payment was used to reduce Alascom's rate base, which will result in lower revenues and depreciation expense in future periods. The remaining $260 million is to be paid when the transaction closes. Closing of the sale of Alascom is subject to certain conditions, including receipt of state and federal regulatory approvals that are expected to be received during the first half of 1995. In September 1994, settlement revenues of $16 million were recognized in long distance network service relating to the settlement of past cost study issues. - 15 - Summarized income statement data for Alascom are as follows:
Nine months ended Third Quarter September 30 _______________ ________________ 1994 1993 1994 1993 ____ ____ ____ ____ (Dollars in Millions) Operating revenues $101.4 $88.8 $261.1 $254.4 Operating income 32.9 15.5 63.6 42.8
Comparison of the third quarters of 1994 and 1993. _________________________________________________ . Revenues increased $13 million or 7%. .. Local network service revenues increased $4 million or 17% primarily due to $2 million of revenue from extended calling area service and the $1 million revenue effect of access line growth of 5%. The implementation of extended calling area service routes shift revenues from network access revenue, long distance revenue and other revenue to local network service revenue. .. Network access service revenues decreased $3 million or 7% primarily due to a $2 million decrease as a result of the shift of extended calling area service to local exchange companies and lower revenue adjustments of $2 million. .. Long distance network service revenues increased $15 million or 23% due to an increase of $19 million relating to the settlement of all open revenue studies. See description relating to the sale of Alascom above. Partially offsetting these increases were $2 million relating to the decline in long lines rate base and a $2 million decrease in interstate access revenue. The Anchorage Telephone Utility ("ATU") exited the National Exchange Carrier Association ("NECA") traffic sensitive pools, which resulted in a reduction in access charge expense that is recovered in interstate access revenue. Other revenue decreased $1 million or 4% primarily due to the effect of a $3 million one-time charge in 1993 relating to service provided in Saudi Arabia, offset in part by a $3 million increase in cellular revenues relating to customer growth in 1994. . Operating expenses decreased $5 million or 4%. .. Maintenance expense decreased $4 million or 11% primarily due to the effect of a $3 million one-time charge in 1993 relating to service provided in Saudi Arabia. . Earnings contribution increased $14 million or 111%. .. Income from operations increased $19 million or 51%. .. Interest expense decreased $3 million or 23% as a result of lower borrowing levels in 1994. - 16 - .. Income tax expense increased $6 million or 64% due to higher taxable income. Comparison of the nine-month periods ended September 30, 1994 and 1993 ______________________________________________________________________ . Revenues increased $6 million or 1%. .. Local network service revenues increased $10 million or 17% primarily due to $6 million of revenue from extended calling area service, the $3 million effect of 5% access line growth and $1 million as a result of a rate increase. .. Network access service revenues decreased $9 million or 7% primarily due to a $5 million decrease as a result of the shift to extended calling area service in local exchange companies and lower revenue adjustments of $5 million. .. Long distance network service revenues increased $9 million or 4% primarily due to long lines interstate revenues of $18 million relating to the settlement of open revenue studies and a $2 million improvement in intrastate revenue relating to increased billed minutes. These increases were offset in part by a $6 million decrease as a result of the exit of ATU from the NECA traffic sensitive pools, the $5 million revenue effect of recoverable expense reductions and the $3 million effect of reduced rate base. See the description of the sale of Alascom above. .. Private line service revenues decreased $7 million or 13% mainly resulting from Pacific Telecom's exit of certain noncore businesses. .. Other revenues increased $1 million or 2% primarily due to customer growth and acquisitions in cellular operations, partially offset by the effect of a $3 million one-time charge in 1993 relating to providing service in Saudi Arabia. Operating expenses decreased $16 million or 4%. .. Operations expense decreased $3 million or 2% primarily due to a $6 million decrease in intrastate access expense relating to the exit of ATU from NECA traffic sensitive pools and a $3 million decrease in leased circuit expense relating to noncore businesses that were sold, partially offset by $4 million of increased cellular expense due to customer growth. .. Maintenance expense decreased $6 million or 7% primarily due to the sale of noncore businesses and the effect of a $3 million one-time charge in 1993 relating to service provided in Saudi Arabia. .. Administrative and general expense decreased $6 million or 10% primarily due to $4 million of reduced corporate support and employee benefit costs relating to long lines and diminished activities for noncore businesses. - 17 - . Earnings contribution increased $19 million or 52%. .. Income from operations increased $21 million or 21%. .. Interest expense decreased $8 million or 22% as a result of lower borrowing levels in 1994. .. Other income increased $4 million primarily due to a $3 million gain on the sale of noncore businesses and a $1 million valuation adjustment to a lease liability. .. Income tax expense increased $11 million or 52% due to higher taxable income. - 18 - FINANCIAL CONDITION - For the nine months ended September 30, 1994: Net cash flows of $762 million were provided by operating activities during the period. Uses for cash were: $556 million for construction program expenditures and $258 million for dividends. During the period, the Company issued 3,029,038 shares of its common stock under the Dividend Reinvestment and Employee Stock Purchase Plans. The Company plans to change from new issuances to open market purchases of shares for these plans. At September 30, 1994, the Company had $421 million of commercial paper and bank borrowings outstanding at an average weighted rate of 5.01%. These borrowings are supported by revolving credit agreements totaling $500 million. At September 30, 1994, the consolidated subsidiaries had access to $671 million of short-term funds through committed bank revolving credit agreements. Subsidiaries had $50 million of commercial paper outstanding at September 30, 1994, as well as borrowings of $51 million under bank revolving credit facilities. At September 30, 1994, the Companies had $78 million of short-term debt classified as long-term debt as they have the intent and ability to support short-term borrowings through the various revolving credit facilities on a long-term basis. The Company and its subsidiaries have intercompany borrowing arrangements providing for loans of funds between parties at short-term market rates. Pacific Telecom has definitive agreements with US West Communi- cations, Inc. to purchase local telephone properties in Colorado for approximately $200 million and similar properties in Oregon and Washington for approximately $180 million. The Colorado Public Utilities Commission order approving the acquisition of the Colorado properties with conditions became final in June 1994. Pacific Telecom expects to close the transaction in late 1994. Completion of the transaction relating to the Oregon and Washington properties is dependent on corporate, regulatory and governmental approvals, receipt of which is expected to occur prior to the end of 1995. Pacific Telecom expects to fund these acquisitions through proceeds received on the sale of Alascom, the issuance of external debt and internally generated funds. On July 8, 1994, Pacific Telecom's subsidiary, Alascom, received the first of two $75 million transition payments from AT&T. In October 1994, Pacific Telecom signed an agreement to sell Alascom to AT&T. The transition payment received in July is being applied to the purchase of Alascom by AT&T. Net cash provided by operating activities was reduced by $43 million for taxes paid on the transition payments received and to be received from AT&T totaling $150 million. Pacific Telecom believes the cash used to make this tax payment directly relates to the $75 million in cash received in July 1994, included in cash flow from investing activities. However, generally accepted accounting principles require income tax expenses to be offset against cash from operating activities. See Item 2. Results of Operations - Telecommunications on page 15. - 19 - See Part II, Item 5. "Other Information" on page 22 of this Form 10-Q for information regarding a proposal by Holdings to acquire the 13% publicly held minority interest of Pacific Telecom. The Company believes that its existing and available capital resources are sufficient to meet working capital, dividend and the majority of construction needs in 1994. __________________________________________________________________________ The condensed consolidated financial statements as of September 30, 1994 and for the three- and nine-month periods then ended have been reviewed by Deloitte & Touche LLP, independent accountants, in accordance with standards established by the American Institute of Certified Public Accountants. A copy of their report is included herein. - 20 - Deloitte & Touche LLP _____________________ _____________________________________________________ 3900 US Bancorp Tower Telephone:(503)222-1341 111 SW Fifth Avenue Facsimile:(503)224-2172 Portland, Oregon 97204-3698 INDEPENDENT ACCOUNTANTS' REPORT _______________________________ PacifiCorp: We have reviewed the accompanying condensed consolidated balance sheet of PacifiCorp and subsidiaries as of September 30, 1994, and the related condensed consolidated statements of income and retained earnings for the three- and nine-month periods ended September 30, 1994 and 1993 and of cash flows for the nine-month periods ended September 30, 1994 and 1993. These financial statements are the responsibility of the Company's management. We conducted our review in accordance with standards established by the American Institute of Certified Public Accountants. A review of interim financial information consists principally of applying analytical procedures to financial data and of making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit conducted in accordance with generally accepted auditing standards, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion. Based on our review, we are not aware of any material modifications that should be made to such condensed consolidated financial statements for them to be in conformity with generally accepted accounting principles. We have previously audited, in accordance with generally accepted auditing standards, the consolidated balance sheet of PacifiCorp and subsidiaries as of December 31, 1993, and the related consolidated statements of income and retained earnings and of cash flows for the year then ended (not presented herein); and in our report dated February 18, 1994 (which contains a paragraph describing the Company's change of accounting in 1993 for income taxes and other postretirement benefits), we expressed an unqualified opinion on those consolidated financial statements. In our opinion, the information set forth in the accompanying condensed consolidated balance sheet as of December 31, 1993 is fairly stated, in all material respects, in relation to the consolidated balance sheet from which it has been derived. DELOITTE & TOUCHE LLP November 10, 1994 - 21 - PART II. OTHER INFORMATION Item 1. Legal Proceedings ______ _________________ In Duval et al. v. Gleason et al., U.S. District Court for the ______________________________ Northern District of California (see "Item 3. Legal Proceedings," ___ at page 14 of the Company's Annual Report on Form 10-K for the year ended December 31, 1993; "Item 1. Legal Proceedings," at page 16 of the Company's Quarterly Report for the period ended March 31, 1994), on July 25, 1994, while PacifiCorp's motion to dismiss was pending, a settlement conference was held to resolve all remaining claims in both the state and federal cases. The parties reached a tentative settlement, which requires final court approval. In Loewen, et al. v. Galligan, et al., Circuit Court for the __________________________________ State of Oregon, County of Multnomah; United States District Court, District of Oregon (see "Item 3. Legal Proceedings" at page 13 of the Company's Annual Report on Form 10-K for the year ended December 31, 1993) on September 14, 1994, the Court of Appeals affirmed the trial court's judgment in all respects. On October 19, 1994, plaintiffs filed a petition for review of the Court of Appeals' decision with the Oregon Supreme Court. In the Matter of Pacific Corporation, Docket No. 1092-05-32-2615, ____________________________________ EPA Region 10 (see "Item 1. Legal Proceedings" at page 16 of the Company's Quarterly Report on Form 10-Q for the period ended March 31, 1994), the parties signed a settlement agreement and the administrative complaint was dismissed. In October 1994, the parties in the In re Equitec Roll-up _____________________ Litigation, United States District Court for the N.D. of __________ California and in Aaberg v. Equitec Financial Group, Inc. et al., ______________________________________________ United States District Court for the N.D. of California (see "Item 3. Legal Proceedings" at page 14 of the Company's Annual Report on Form 10-K for the year ended December 31, 1993), stipulated to a judgment of dismissal without costs or attorneys' fees to any party. The Court approved the stipulated judgment and entered a judgment of dismissal. Item 5. Other Information ______ _________________ The board of directors of PacifiCorp Holdings, Inc. has approved a proposal to acquire the 13% publicly held minority interest of Pacific Telecom (NASD:PTCM) for $28.00 per share. Holdings currently owns the remaining 87% of the outstanding stock of Pacific Telecom. Under the terms of the proposal, a newly formed, wholly-owned subsidiary of Holdings would merge into Pacific Telecom and the holders of approximately 5.3 million shares of common stock of Pacific Telecom not held by Holdings would receive cash in the amount of $28.00 in exchange for each share of Pacific Telecom common stock. As a result of the merger, Pacific Telecom would become a wholly-owned subsidiary of Holdings. - 22 - The merger requires approval by Pacific Telecom's board of directors, a majority of which is not affiliated with PacifiCorp, and is subject to regulatory approvals and other conditions customary in such transactions. Item 6. Exhibits and Reports on Form 8-K ______ ________________________________ (a) Exhibits. Exhibit 12(a): Statement of Computation of Ratio of Earnings to Fixed Charges. Exhibit 12(b): Statements of Computation of Ratio of Earnings to Combined Fixed Charges and Preferred Stock Dividends. Exhibit 15: Letter re unaudited interim financial information of awareness of incorporation by reference. Exhibit 27: Financial Data Schedule (filed electronically only). (b) Reports on Form 8-K. On Form 8-K dated October 17, 1994, under Item 5. "Other Events," the Company reported that its 87%-owned subsidiary, Pacific Telecom, Inc., signed an agreement to sell the stock of Alascom, Inc. to AT&T. On Form 8-K dated October 26, 1994, under Item 5. "Other Events," the Company filed a press release reporting financial results for the three- and nine-months ended September 30, 1994. On Form 8-K dated November 1, 1994, under Item 5. "Other Events," the Company announced that the board of directors of PacifiCorp Holdings, Inc. has approved a proposal to acquire the 13% publicly held minority interest of Pacific Telecom, Inc. (NASD: PTCM) for $28.00 per share. - 23 - SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. PACIFICORP Date November 10, 1994 By DANIEL L. SPALDING _________________________ ________________________________ Daniel L. Spalding Senior Vice President (Chief Accounting Officer) - 24 - INDEX TO EXHIBITS
EXHIBIT DESCRIPTION PAGE _______ ___________ ____ 12(a) Statement of Computation of Ratio of Earnings to Fixed Charges 12(b) Statements of Computation of Ratio of Earnings to Combined Fixed Charges and Preferred Stock Dividends 15 Letter re unaudited interim financial information of awareness of incorporation by reference 27 Financial Data Schedule (filed electronically only)
EX-12 2 EXHIBIT (12)(a) PACIFICORP STATEMENTS OF COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES (IN MILLIONS OF DOLLARS)
Nine Months YEAR ENDED DECEMBER 31, Ended _______________________________________________________ 1989 1990 1991 1992 1993 September 30, 1994 ____ ____ ____ ____ ____ __________________ Fixed Charges, as defined:* Interest expense....................... $ 473.1 $ 431.2 $ 428.0 $ 409.7 $ 377.8 $252.5 Estimated interest portion of rentals charged to expense........ 29.9 23.3 20.4 17.1 20.1 13.7 Preferred dividend requirement of majority-owned subsidiary............ 4.5 4.2 - - - - _______ _______ _______ _______ _______ _____ Total fixed charges............ $ 507.5 $ 458.7 $ 448.4 $ 426.8 $ 397.9 $266.2 _______ _______ _______ _______ _______ _____ _______ _______ _______ _______ _______ _____ Earnings, as defined:* Income from continuing operations........................... $ 403.0 $ 413.4 $ 446.8 $ 150.2 $ 422.7 $341.6 Add (deduct): Provision for income taxes........... 207.1 179.1 176.7 90.8 187.4 183.4 Minority interest.................... 12.3 18.1 14.1 8.4 11.3 10.6 Undistributed income of less than 50% owned affiliates..... 14.7 - (1.8) (5.7) (16.2) (11.6) Fixed charges as above............... 507.5 458.7 448.4 426.8 397.9 266.2 _______ _______ _______ _______ _______ _____ Total earnings................. $1,144.6 $1,069.3 $1,084.2 $ 670.5 $1,003.1 $790.2 _______ _______ _______ _______ _______ _____ _______ _______ _______ _______ _______ _____ Ratio of Earnings to Fixed Charges....... 2.3x 2.3x 2.4x 1.6x 2.5x 3.0x ____ ____ ____ ____ ____ ____ ____ ____ ____ ____ ____ ____ _______________ *"Fixed charges" represents consolidated interest charges, an estimated amount representing the interest factor in rents and preferred stock dividend requirements of majority-owned subsidiaries. "Earnings" represent the aggregate of (a) income from continuing operations, (b) taxes based on income from continuing operations, (c) minority interest in the income of majority-owned subsidiaries that have fixed charges, (d) fixed charges and (e) undistributed (income) losses of less than 50% owned affiliates without loan guarantees.
EX-12 3 PACIFICORP EXHIBIT (12)(b) STATEMENTS OF COMPUTATION OF RATIO OF EARNINGS TO COMBINED FIXED CHARGES AND PREFERRED STOCK DIVIDENDS (IN MILLIONS OF DOLLARS)
Nine Months YEAR ENDED DECEMBER 31, Ended _______________________________________________________ 1989 1990 1991 1992 1993 September 30, 1994 ____ ____ ____ ____ ____ __________________ Fixed Charges, as defined:* Interest expense.................... $ 473.1 $ 431.2 $ 428.0 $ 409.7 $ 377.8 $ 252.5 Estimated interest portion of rentals charged to expense..... 29.9 23.3 20.4 17.1 20.1 13.7 Preferred dividend requirement of majority-owned subsidiary...... 4.5 4.2 - - - - _______ _______ _______ _______ _______ ______ Total fixed charges......... 507.5 458.7 448.4 426.8 397.9 266.2 Preferred Stock Dividends, as defined:*...................... 31.9 31.7 37.4 59.9 56.8 45.5 _______ _______ _______ _______ _______ ______ Total fixed charges and preferred dividends....... $ 539.4 $ 490.4 $ 485.8 $ 486.7 $ 454.7 $ 311.7 _______ _______ _______ _______ _______ ______ _______ _______ _______ _______ _______ ______ Earnings, as defined:* Net income from continuing operations........................ $ 403.0 $ 413.4 $ 446.8 $ 150.2 $ 422.7 $ 341.6 Add (deduct): Provision for income taxes........ 207.1 179.1 176.7 90.8 187.4 183.4 Minority interest................. 12.3 18.1 14.1 8.4 11.3 10.6 Undistributed losses (income) of less than 50% owned affiliates............ 14.7 - (1.8) (5.7) (16.2) (11.6) Fixed charges as above............ 507.5 458.7 448.4 426.8 397.9 266.2 _______ _______ _______ _______ _______ ______ Total earnings.............. $1,144.6 $1,069.3 $1,084.2 $ 670.5 $1,003.1 $ 790.2 _______ _______ _______ _______ _______ ______ _______ _______ _______ _______ _______ ______ Ratio of Earnings to Combined Fixed Charges and Preferred Stock Dividends.. 2.1x 2.2x 2.2x 1.4x 2.2x 2.5x ____ ____ ____ ____ ____ ____ ____ ____ ____ ____ ____ ____ _______________ *"Fixed charges" represent consolidated interest charges, an estimated amount representing the interest factor in rents and preferred stock dividend requirements of majority-owned subsidiaries. "Preferred Stock Dividends" represent preferred dividend requirements multiplied by the ratio which pre-tax income from continuing operations bears to income from continuing operations. "Earnings" represent the aggregate of (a) income from continuing operations, (b) taxes based on income from continuing operations, (c) minority interest in the income of majority-owned subsidiaries that have fixed charges, (d) fixed charges and (e) undistributed (income) losses of less than 50% owned affiliates without loan guarantees.
EX-15 4 Deloitte & Touche LLP _____________________ _____________________________________________________ 3900 US Bancorp Tower Telephone:(503)222-1341 111 SW Fifth Avenue Facsimile:(503)224-2172 Portland, Oregon 97204-3698 EXHIBIT 15 November 10, 1994 PacifiCorp 700 N.E. Multnomah Portland, Oregon We have made a review, in accordance with standards established by the American Institute of Certified Public Accountants, of the unaudited interim financial information of PacifiCorp and subsidiaries for the periods ended September 30, 1994 and 1993, as indicated in our report dated November 10, 1994; because we did not perform an audit, we expressed no opinion on that information. We are aware that our report referred to above, which is included in your Quarterly Report on Form 10-Q for the quarter ended September 30, 1994, is incorporated by reference in Registration Statement Nos. 33-36452, 33-49607, 33-51163 and 33-55309, all on Form S-3; in Registration Statement Nos. 33-39195 and 33-49479, and Post-Effective Amendment No. 1 to Registration Statement No. 33-17970, all on Form S-8; and in Registration Statement No. 33-36239 on Form S-4. We are also aware that the aforementioned report, pursuant to Rule 436(c) under the Securities Act, is not considered a part of the Registration Statement prepared or certified by an accountant or a report prepared or certified by an accountant within the meaning of Sections 7 and 11 of that Act. DELOITTE & TOUCHE LLP EX-27 5
UT THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM PACIFICORP'S SEPTEMBER 30, 1994 10-Q AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS 0000075594 PACIFICORP 1000 9-MOS DEC-31-1994 SEP-30-1994 PER-BOOK 8158000 647200 851000 307500 1905500 11869200 2976900 0 434300 3411200 367400 219000 3773100 130900 0 347100 102500 0 26900 2500 3488600 11869200 2616400 183400 1898300 2081700 534700 33700 568400 226800 341600 29700 311900 228500 214000 762400 1.10 1.10
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