-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, N4f7RMTvZhGNJWkkSanYOfMprjkRsC3ylYEyKAlGuC1d0xodEfXvQ66/90DORMsL QpBNKchCJuBQKYo77QLRvg== 0000899652-99-000097.txt : 19990802 0000899652-99-000097.hdr.sgml : 19990802 ACCESSION NUMBER: 0000899652-99-000097 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19990715 ITEM INFORMATION: ITEM INFORMATION: FILED AS OF DATE: 19990730 FILER: COMPANY DATA: COMPANY CONFORMED NAME: CINERGY CORP CENTRAL INDEX KEY: 0000899652 STANDARD INDUSTRIAL CLASSIFICATION: ELECTRIC & OTHER SERVICES COMBINED [4931] IRS NUMBER: 311385023 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: SEC FILE NUMBER: 001-11377 FILM NUMBER: 99673856 BUSINESS ADDRESS: STREET 1: 139 E FOURTH ST CITY: CINCINNATI STATE: OH ZIP: 45202 BUSINESS PHONE: 5132872291 MAIL ADDRESS: STREET 1: 139 E FOURTH STREET STREET 2: P.O BOX 960 CITY: CINCINATI STATE: OH ZIP: 45202 8-K 1 FORM 8-K CURRENT REPORT-- SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report (Date of earliest event reported): July 15, 1999 Cinergy Corp. (Exact name of registrant as specified in its charter) Delaware 1-11377 31-1385023 (State of (Commission (IRS Employer incorporation) File Number) Identification No.) 139 East Fourth Street, Cincinnati, OH 45202 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (513) 287-2644 TABLE OF CONTENTS Item Page Number Number 2 Aquisition or Disposition of Assets 7 Financial Statements and Exhibits Cinergy Corp. Consolidated Pro Forma Balance Sheets at March 31, 1999 Consolidated Pro Forma Statement of Income for the Quarter ended March 31, 1999 . . . . . . . . . . . . Consolidated Pro Forma Statement of Income for the Year ended December 31, 1998 . .. . . . . . . . . . . . Pro Forma Adjustment Entries . .... . . . . . . . . . . . Signature ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS. As previously reported, Cinergy Corp. ("Cinergy") and GPU, Inc. ("GPU") entered into an agreement for GPU to buy Cinergy's 50% stake in Avon Energy Partners Holdings ("Avon"), which indirectly owns Midlands Electricity plc. Avon was formed in 1996 along with its wholly owned subsidiary, Avon Energy Partners plc, for the purpose of acquiring all the outstanding ordinary shares of Midlands Electricity plc ("Midlands"). Midlands is headquartered in Worcester, England and is one of 12 regional electricity companies in England and Wales. Midlands distributes electricity to 2.2 million customers in a 5,000-square-mile franchise service area that includes Birmingham, the U.K.'s second largest city. Midlands owns and operates approximately 40,000 miles of overhead and underground circuit. Cinergy's stake in Avon was held by Cinergy UK, Inc. ("Cinergy UK"). On July 15, 1999, the transaction was completed using a capital reduction agreement. Under the agreement, Avon cancelled all shares of its capital stock held by Cinergy UK in return for a payment of 452,500,000 pounds sterling UK (approximately $705 million) to Cinergy UK, a net cash transaction of approximately $600 million after income taxes. After the completion of the transaction, GPU indirectly holds all of the capital stock in Avon. Cinergy Global Resources, Inc., a direct subsidiary of Cinergy Corp., retained Midlands' gas trading operation. ITEM 7. FINANCIAL STATEMENTS CINERGY CORP. CONSOLIDATED BALANCE SHEETS As of March 31, 1999 (unaudited) (dollars in thousands)
ASSETS Pro Forma Actual Adjustments Pro Forma Current Assets Cash and temporary cash investments $ 92,652 $ 705,000 (1) $ 163,652 (20,000)(2) (14,000)(3) (600,000)(7) Restricted deposits 3,641 3,641 Notes receivable 59 59 Accounts receivable less accumulated provision for doubtful accounts of $31,355 at March 31, 1999, and $25,622 at December 31, 1998 397,686 397,686 Materials, supplies, and fuel - at average cost 180,969 180,969 Prepayments and other 73,692 73,692 Energy risk management assets 703,278 703,278 ----------- ---------- ----------- 1,451,977 71,000 1,522,977 Utility Plant - Original Cost In service Electric 9,248,374 9,248,374 Gas 794,785 794,785 Common 197,299 197,299 ----------- ----------- 10,240,458 10,240,458 Accumulated depreciation 4,100,406 4,100,406 ----------- ----------- 6,140,052 6,140,052 Construction work in progress 209,461 209,461 ----------- ----------- Total utility plant 6,349,513 6,349,513 Other Assets Regulatory assets 940,386 940,386 Investments in unconsolidated subsidiaries 645,250 (583,000)(1) 62,250 Other 459,022 459,022 ----------- ---------- ----------- 2,044,658 (583,000) 1,461,658 $ 9,846,148 $(512,000) $ 9,334,148
CINERGY CORP. CONSOLIDATED BALANCE SHEETS As of March 31, 1999 (unaudited) (dollars in thousands) LIABILITIES AND SHAREHOLDERS' EQUITY Pro Forma Actual Adjustments Pro Forma Current Liabilities Accounts payable $ 433,732 $ 3,000 (4) $ 436,732 Accrued taxes 240,179 32,000 (6) 272,179 Accrued interest 40,878 (4,000)(2) 22,878 (14,000)(3) Notes payable and other short-term obligations 1,052,811 (600,000)(7) 452,811 Long-term debt due within one year 25,959 25,959 Energy risk management liabilities 828,424 828,424 Other 86,814 86,814 ---------- ---------- ---------- 2,708,797 (583,000) 2,125,797 Non-Current Liabilities Long-term debt 2,605,657 2,605,657 Deferred income taxes 1,100,473 1,100,473 Unamortized investment tax credits 154,381 154,381 Accrued pension and other postretirement benefit costs 323,949 323,949 Other 268,042 268,042 ---------- ---------- 4,452,502 4,452,502 Total liabilities 7,161,299 (583,000) 6,578,299 Cumulative Preferred Stock of Subsidiaries not subject to mandatory redemption 92,616 92,616 Common Stock Equity Common stock - $.01 par value; authorized shares - 600,000,000; outstanding shares - 158,779,900 at March 31, 1999, and 158,664,532 at December 31, 1998 1,588 1,588 Paid-in capital 1,598,884 1,598,884 Retained earnings 1,001,034 68,000 1,069,034 Accumulated other comprehensive loss (9,273) 3,000 (5) (6,273) Total common stock equity 2,592,233 71,000 2,663,233 ---------- ---------- ---------- $9,846,148 $(512,000) $9,334,148
CINERGY CORP. CONSOLIDATED PRO FORMA STATEMENT OF INCOME For the Quarter Ended March 31, 1999 (unaudited) (dollars in thousands, except per share amounts) Pro Forma Actual Adjustments Pro Forma Operating Revenues Electric $ 968,532 $ 968,532 Gas 421,308 421,308 Other 12,439 12,439 ---------- ---------- 1,402,279 1,402,279 Operating Expenses Fuel and purchased and exchanged power 433,169 433,169 Gas purchased 334,402 334,402 Other operation and maintenance 244,548 244,548 Depreciation and amortization 86,477 86,477 Taxes other than income taxes 69,534 69,534 ---------- ---------- 1,168,130 1,168,130 Operating Income 234,149 234,149 Equity in Earnings of Unconsolidated Subsidiaries 44,682 $(45,000)(1) (318) Other Income and (Expenses) - Net (11,886) (11,886) Interest 60,772 (3,000)(2) 49,772 ---------- (8,000)(2) ---------- Income Before Taxes 206,173 (34,000) 172,173 Income Taxes 77,564 (15,000)(1) 66,564 1,000 (2) 3,000 (3) Preferred Dividend Requirements of Subsidiaries 1,364 1,364 ---------- ---------- Net Income $ 127,245 $(23,000) $ 104,245 Average Common Shares Outstanding 158,746 158,746 Earnings Per Common Share Net income $0.80 $0.66 Earnings Per Common Share - Assuming Dilution net income $0.80 $0.66 Dividends Declared Per Common Share $0.45 $0.45
CINERGY CORP. CONSOLIDATED PRO FORMA STATEMENT OF INCOME For the Year Ended December 31, 1998 (unaudited) (dollars in thousands, except per share amounts) Pro Forma Actual Adjustments Pro Forma Operating Revenues Electric $4,747,235 $4,747,235 Gas 1,060,664 1,060,664 Other 68,395 68,395 ---------- ---------- 5,876,294 5,876,294 Operating Expenses Fuel and purchased and exchanged power 2,846,323 2,846,323 Gas purchased 857,010 857,010 Other operation and maintenance 1,006,382 1,006,382 Depreciation and amortization 325,515 325,515 Taxes other than income taxes 274,635 274,635 ---------- ---------- 5,309,865 5,309,865 Operating Income 566,429 566,429 Equity in Earnings of Unconsolidated Subsidiaries 51,484 $(57,000)(1) (5,516) Other Income and (Expenses) - Net 10,346 10,346 Interest 243,587 (10,000)(2) 199,587 ---------- ---------- ---------- (34,000)(3) Income Before Taxes 384,672 (13,000) 371,672 Income Taxes 117,187 (10,000)(1) 122,187 3,000 (2) 12,000 (3) Preferred Dividend Requirements of Subsidiaries 6,517 6,517 ---------- ---------- ---------- Net Income Before Extraordinary Item $ 260,968 $ (18,000) $ 242,968 Average Common Shares Outstanding 158,238 158,238 Earnings Per Common Share $1.65 $1.54 Earnings Per Common Share - Assuming Dilution $1.65 $1.54 Dividends Declared Per Common Share $1.80 $1.80
CINERGY CORP. PRO FORMA ADJUSTMENT ENTRIES RELATED TO ITEM 2 FOR THE CONSOLIDATED BALANCE SHEET AS OF MARCH 31, 1999 (dollars in millions) Entry 1 Cash and Temporary Cash Investments 705 Investments in Unconsolidated Subsidiaries 583 Other Income and Expense 122 To reflect the cash received for the transaction Entry 2 Other Income and Expense 16 Accrued Interest 4 Cash and Temporary Cash Investments 20 To reflect the additional costs and reflect the closing of the associated currency swap Entry 3 Accrued Interest 14 Cash and Temporary Cash Investments 14 To reflect the closing of the notional amount of the swap Entry 4 Other Income and Expense 3 Accounts Payable 3 To reflect expenses related to the sales transaction Entry 5 Accrued Interest 3 Accumulated Other Comprehensive loss 3 To eliminate the currency translation amounts associated with the transaction Entry 6 Income Taxes 32 Accrued Taxes 32 To reflect the tax effect of the transaction Entry 7 Notes Payable and Other Short-Term Obligations 600 Cash and Temporary Cash Investments 600 To reflect the use of the proceeds from the transaction
CINERGY CORP. PRO FORMA ADJUSTMENT ENTRIES RELATED TO ITEM 2 FOR THE CONSOLIDATED INCOME STATEMENT FOR THE QUARTER ENDED MARCH 31, 1999 (dollars in millions) Entry 1 Equity in Earnings of Unconsolidated Subsidieries 45 Accrued Taxes 15 Income Taxes 15 Investments in Unconsolidated Subsidieries 45 To reflect the direct earnings impact of the transaction Entry 2 Accrued Interest 3 Income Taxes 1 Interest Expense 3 Accrued Taxes 1 To reflect the impact of the removal of the interest rate swap Entry 3 Accrued Interest 8 Income Taxes 3 Interest Expense 8 Accrued Taxes 3 To reflect the decrease in associated interest expense related to the transaction
CINERGY CORP. PRO FORMA ADJUSTMENT ENTRIES RELATED TO ITEM 2 FOR THE CONSOLIDATED INCOME STATEMENT FOR THE YEAR ENDED DECEMBER 31, 1998 Entry 1 Equity in Earnings of Unconsolidated Subsidieries 57 Accrued Taxes 10 Income Taxes 10 Investments in Unconsolidated Subsidieries 57 To reflect the direct earnings impact of the transaction Entry 2 Accrued Interest 10 Income Taxes 3 Interest Expense 10 Accrued Taxes 3 To reflect the impact of the removal of the interest rate swap Entry 3 Accrued Interest 34 Income Taxes 12 Interest Expense 34 Accrued Taxes 12 To reflect the decrease in associated interest expense related to the transaction
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 hereunto duly authorized. Cinergy Corp._________ (Registrant) Date: July 29, 1999 By: /s/ Bernard F. Roberts -------------------------------- Bernard F. Roberts Vice President and Comptroller (Signature) -----END PRIVACY-ENHANCED MESSAGE-----