-----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, U03bbykdXpTshzRGksx2C2Ad+DPbUc/3McQDl8rWZwo//ViAgtvW9hvw0edCVKGo wdzzreKEQMnJQhFlG8CDPg== 0000925655-96-000007.txt : 19960816 0000925655-96-000007.hdr.sgml : 19960816 ACCESSION NUMBER: 0000925655-96-000007 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 19960630 FILED AS OF DATE: 19960814 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: TRIGEN ENERGY CORP CENTRAL INDEX KEY: 0000925655 STANDARD INDUSTRIAL CLASSIFICATION: STEAM & AIR CONDITIONING SUPPLY [4961] IRS NUMBER: 133378939 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-13264 FILM NUMBER: 96612324 BUSINESS ADDRESS: STREET 1: ONE WATER ST CITY: WHITE PLAINS STATE: NY ZIP: 10601 BUSINESS PHONE: 9142866600 MAIL ADDRESS: STREET 1: ONE WATER ST CITY: WHITE PLAINS STATE: NY ZIP: 10601 10-Q 1 FORM 10-Q FOR QUARTER ENDING 6/30/96 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) [ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 1996 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 No. 1-13264 TRIGEN ENERGY CORPORATION (Exact name of Registrant as specified in its charter) Delaware 13-3378939 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification Number) One Water Street White Plains, New York 10601 (Address of principal executive offices) (Zip Code) (914) 286-6600 (Registrant's telephone number, including area code) 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 12 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 the past 90 days. Yes X No There were 11,507,680 shares of the Registrant's Common Stock outstanding as of August 12, 1996. TRIGEN ENERGY CORPORATION AND SUBSIDIARIES INDEX TO FORM 10-Q Quarter Ended June 30, 1996 Part I - Financial Information: Page Item 1. Financial Statements Condensed Consolidated Statements of Operations for the Three and Six Months Ended June 30, 1996 and 1995 (Unaudited) 2 Condensed Consolidated Balance Sheets as of June 30, 1996 (Unaudited) and December 31, 1995 3 Condensed Consolidated Statements of Cash Flows for the Six Months Ended June 30, 1996 and 1995 (Unaudited) 4 Notes to Condensed Consolidated Financial Statements (Unaudited) 5 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 5-8 Part II - Other Information: Item 4. Submission of Matters to a Vote of Security Holders 9 Item 6. Exhibits and Reports on Form 8-K 9 Signature 10
TRIGEN ENERGY CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS For the Three and Six Months Ended June 30, 1996 and 1995 Unaudited (All amounts in thousands, except share and per share data) Three Months Ended June 30, Six Months Ended June 30, 1996 1995 1996 1995 Revenues Energy revenues $46,674 $34,251 $129,033 $97,874 Fees earned and other 2,011 1,524 5,871 3,077 ------- ------- ------- ------- Total revenues 48,685 35,775 134,904 $100,951 Operating expenses Fuel and consumables 20,412 11,544 68,220 44,048 Production and operating costs 8,715 8,490 21,876 20,590 Depreciation 3,157 2,606 7,350 6,649 General and administrative 7,079 5,160 15,993 11,687 ------- ------- ------- ------- Total operating expenses 39,363 27,800 113,439 82,974 Operating income 9,322 7,975 21,465 17,977 Other income (expense): Interest expense (4,796) (4,913) (9,465) (9,902) Other income, net 416 477 835 1,014 ------- ------- ------- ------- Income before minority interests and income tax expense 4,942 3,539 12,835 9,089 Minority interests in earnings of consolidated entities (700) 1 (1,501) (36) ------- ------- ------- ------- Income before income tax expense 4,242 3,540 11,334 9,053 Income tax expense 1,744 1,400 4,655 3,655 ------- ------- ------- ------- Net income $ 2,498 $ 2,140 $ 6,679 $ 5,398 ======= ======= ======= ======= Net income per share $.22 $.19 $.58 $.47 ===== ==== ==== ==== Average shares outstanding 11,506,844 11,386,362 11,488,251 11,379,581 Dividends per share $.035 $.035 $.07 $.07 ===== ===== ==== ==== See accompanying notes to condensed consolidated financial statements.
TRIGEN ENERGY CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (All amounts in thousands, except share data) June 30, December 31, 1996 1995 (Unaudited) Assets Current assets: Cash and cash equivalents $ 6,635 $ 9,984 Accounts receivable: Trade (less allowance for doubtful accounts of $859 in 1996 and $697 in 1995) 22,142 36,275 Other 3,303 1,922 Inventories 6,481 6,239 Prepaid costs and other 7,454 6,890 ------- ------- Total current assets 46,015 61,310 Non-current cash and cash equivalents 10,813 10,191 Property, plant and equipment, net 345,966 341,188 Investment in non-consolidated partnerships 8,623 6,548 Intangible assets, net 15,260 15,088 Deferred costs and other assets, net 18,934 20,581 ------- ------- Total assets $445,611 $454,906 ======== ======== Liabilities and Stockholders' Equity Current liabilities: Accounts payable $ 4,980 $ 5,924 Accrued fuel 10,291 16,806 Accrued expenses and other 18,836 16,718 Short-term debt --- 14,165 Current portion of long-term debt 12,645 7,415 -------- -------- Total current liabilities 46,752 61,028 Long-term debt 218,740 223,371 Other liabilities 8,831 9,229 Deferred income tax liabilities 28,114 25,222 -------- -------- Total liabilities 302,437 318,850 Minority interests in consolidated entities 17,021 17,226 Stockholders' equity: Preferred stock-$.01 par value (authorized and unissued 15,000,000 shares) ---- ---- Common stock-$.01 par value (authorized 60,000,000 shares; issued 11,533,219 shares in 1996, 11,416,418 shares in 1995) 115 114 Additional paid-in capital 102,684 100,788 Retained earnings 23,941 18,070 Treasury stock, at cost (28,996 shares in 1996, 7,268 shares in 1995) (587) (142) -------- -------- Total stockholders' equity 126,153 118,830 -------- -------- Total liabilities and stockholders' equity $445,611 $454,906 ======== ======== See accompanying notes to condensed consolidated financial statements.
TRIGEN ENERGY CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS For the Six Months Ended June 30, 1996 and 1995 Unaudited (All amounts in thousands) 1996 1995 Increase (decrease) in cash and cash equivalents: Net cash provided by operating activities $ 25,911 $ 15,170 -------- -------- Cash flows from investing activities: Sale of marketable securities ---- 16,361 Capital expenditures (12,073) (7,536) Investment in non-consolidated partnerships,net (2,075) (1,022) ------- ------- Net cash (used in) provided by investing activities (14,148) 7,803 ------- ------- Cash flows from financing activities: Short-term debt, net (14,165) (14,600) Proceeds of long-term borrowings 8,000 ---- Payments of long-term borrowings (7,401) (1,810) Dividends (808) (797) Issuance of common stock 860 262 Repurchase of common stock (445) ---- Sale of interest rate caps 1,003 ---- Distribution to minority interests (1,534) ---- ------- ------- Net cash used in financing activities (14,490) (16,945) Net (decrease) increase in cash and cash equivalents (2,727) 6,028 Cash and cash equivalents at January 1 20,175 19,837 ------- ------- Cash and cash equivalents at June 30 $17,448 $25,865 ======= ======= Cash and cash equivalents at June 30: Current cash and cash equivalents $ 6,635 $16,158 Non-current cash and cash equivalents 10,813 9,707 ------- ------- Cash and cash equivalents at June 30 $17,448 $25,865 ======= ======= Supplemental disclosure of cash flow information: Cash paid during the period for: Interest (net of amounts capitalized) $ 9,577 $ 9,123 ======= ======= Income taxes $ 1,472 $ 3,284 ======= ======= Non-cash investing activity: Acquisition of subsidiary $ 1,037 $ ---- ======= ======= Non-cash financing activity: Issuance of common stock for acquisition of subsidiary $ 1,037 $ ---- ======= ======= See accompanying notes to condensed consolidated financial statements.
TRIGEN ENERGY CORPORATION AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) 1. Basis of Presentation Trigen Energy Corporation (the "Company") develops, owns and operates community energy systems and cogeneration facilities at 13 locations in the United States and Canada. The Company believes that it is the leading commercial owner and operator of community energy systems in North America. A community energy system consists of a central production plant that distributes steam, hot water and/or chilled water to customer buildings through underground distribution pipelines. Steam, hot water and/or chilled water are sold by the Company to over 1,500 customers, including colleges and universities, office buildings, hotels, civic and cultural landmarks, housing complexes, industrial plants and hospitals. Cogenerated electricity produced by the Company is used by the Company in eight of its systems and is sold to one steam customer and to local utilities in three communities. The consolidated financial statements of Trigen Energy Corporation and its subsidiaries presented herein are unaudited. However, such information reflects all adjustments, consisting of normal recurring adjustments, which are, in the opinion of management, necessary to present fairly the financial position as of June 30, 1996, and the results of operations for the three and six months ended June 30, 1996 and 1995 and the cash flows for the six months ended June 30, 1996 and 1995. The results of operations for the three and six month periods ended June 30, 1996 and cash flows for the six month period ended June 30, 1996 are not indicative of those to be expected for the year ending December 31, 1996. These financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto for the year ended December 31, 1995 included in the Company's Annual Report on Form 10-K for the year ended December 31, 1995. 2. Subsequent Event On July 29, 1996, the Company was granted an additional condemnation award of $6.8 million related to one of its facilities in Boston, Massachusetts. Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Overview The Company's operations are primarily the production and distribution of steam, hot water, electricity and chilled water. Approximately 60% of total revenue is derived from long-term contracts. The Company's heating and cooling revenues and consequently its operating profits are subject to seasonal fluctuation due to heating demand in the winter and cooling demand in the summer. For the quarter ended June 30, 1996, the Company reported net income of $2.5 million or $0.22 per share compared to $2.1 million or $0.19 per share for the comparable 1995 period. For the six months ended June 30, 1996, the Company reported net income of $6.7 million or $0.58 per share compared to $5.4 million or $0.47 per share for the comparable 1995 period. Results of Operations Three Months Ended June 30, 1996 Compared to Three Months Ended June 30, 1995 Revenues Revenues were $48.7 million for the three months ended June 30, 1996, an increase of $12.9 million, from $35.8 million in the corresponding quarter in 1995, due principally to two acquisitions consummated in September 1995, which contributed approximately 68% ($8.8 million) of the increase, and the increased price of fuel. Operating Expenses The Company's cost of sales includes fuel and consumables, production and operating costs and depreciation expense and is affected primarily by its costs for fuel, chemicals, water and other commodities. Because the Company's rates typically enable it to pass changes in its fuel and most commodity costs to the customer, such changes have little impact on operating income. The Company's cost of sales and its operating income are affected by its efficiency in converting fuel to steam, hot water, electricity and chilled water and its ability to minimize costs through automation and enhanced process control. Cost of sales as a percentage of revenues increased from 63.3% of revenues in the second quarter of 1995 to 66.3% of revenues in the second quarter of 1996, principally resulting from the increased cost of fuel. Fuel and consumable costs were $20.4 million, or 41.9% of revenues in the second quarter of 1996, compared to $11.5 million, or 32.3% of revenues in the same period of 1995, an increase of $8.9 million. This increase is due to the impact of the two acquisitions ($4.6 million) and the increased price of fuel. Production and operating costs are those costs of operating the Company's facilities other than fuel and consumables, and include labor and supervisory personnel, repair and maintenance costs and plant operating costs. The increase resulting from the two acquisitions of $1.8 million was offset by cost savings, labor productivity improvements and an arbitration award. Production and operating costs increased to $8.7 million in the 1996 period from $8.5 million in the 1995 period, and as a percentage of revenues decreased to 17.9% in the 1996 period compared to 23.7% in the 1995 period. Depreciation expense was $3.2 million in the second quarter of 1996 compared to $2.6 million in the second quarter of 1995, an increase of $0.6 million due predominately to the two acquisitions ($0.3 million). General and administrative expenses represent on-site management and other overhead costs incurred for existing operations, as well as the Company's marketing, development and corporate management costs. General and administrative costs increased to $7.1 million, or 14.5% of revenues in the 1996 period from $5.2 million, or 14.4% of revenues in the 1995 period. This is primarily due to additional development staff and related costs and the impact of the two acquisitions ($0.5 million). Operating Income Operating income was $9.3 million, or 19.1% of revenues, in the second quarter of 1996 compared to $8.0 million, or 22.3% of revenues, in the same 1995 period. Increased general and administrative expenses were partially offset by cost savings, primarily from efficiency and labor productivity, higher revenues, and the impact of the two acquisitions ($1.5 million). Interest Expense; Other Income Interest expense decreased to $4.8 million in the second quarter of 1996 from $4.9 million in the same 1995 period, primarily due to lower average interest rates on indebtedness. Income Tax Expense The Company's effective tax rate is determined primarily by the federal statutory rate of 35%, and state and local income taxes. The effective income tax rate of 41.1% is consistent with the rate in the second quarter of 1995. Six Months Ended June 30, 1996 Compared to Six Months Ended June 30, 1995 Revenues Revenues were $134.9 million for the six months ended June 30, 1996, an increase of $33.9 million, from $101.0 million in the corresponding period in 1995, due principally to two acquisitions consummated in September 1995, which contributed approximately 54% ($18.4 million) of the increase, a colder winter in 1996 compared to 1995 and the increased price of fuel. Operating Expenses Cost of sales as a percentage of revenues increased from 70.6% of revenues in 1995 to 72.2% of revenues in 1996. Fuel and consumable costs were $68.2 million, or 50.6% of revenues, in 1996, compared to $44.0 million, or 43.6% of revenues, in 1995, an increase of $24.2 million. This increase is due to the impact of the two acquisitions ($9.9 million) and the increased price of fuel. Production and operating costs increased to $21.9 million in 1996 from $20.6 million in 1995, and as a percentage of revenues decreased to 16.2% in 1996 compared to 20.4% in 1995. The increase of $3.6 million resulting from the two acquisitions was offset by cost savings, labor productivity improvements and an arbitration award. Depreciation expense was $7.4 million in 1996 compared to $6.6 million in 1995, an increase of $0.8 million due predominately to the two acquisitions ($0.5 million). General and administrative costs increased to $16.0 million, or 11.9% of revenues, in 1996, from $11.7 million, or 11.6% of revenues, in 1995. This is primarily due to additional staff and development costs and the impact of the two acquisitions ($1.1 million). Operating Income Operating income was $21.5 million, or 15.9% of revenues, in 1996 compared to $18.0 million, or 17.8% of revenues, in 1995. Increased general and administrative expenses offset by cost savings, primarily from efficiency and labor productivity, higher revenues, and the impact of the two acquisitions ($3.3 million), resulted in improved operating income of $3.5 million. Interest Expense; Other Income Interest expense decreased to $9.5 million in 1996 from $9.9 million in 1995, primarily due to lower average interest rates on indebtedness. Income Tax Expense The Company's effective tax rate is determined primarily by the federal statutory rate of 35%, and state and local income taxes. The effective income tax rate of 41.1% is consistent with the rate in 1995. Liquidity and Capital Resources Liquidity The Company had cash and cash equivalents of $17.4 million at June 30, 1996 and $20.2 million at December 31, 1995, a decrease of $2.8 million. The Company had no short-term indebtedness outstanding at June 30, 1996 compared to $14.2 million at December 31, 1995, a reduction of $14.2 million. These changes were primarily due to the use of cash on hand at December 31, 1995 and cash generated from operations during the year. Certain of the Company's debt agreements restrict payments by its subsidiaries, which are the primary obligors, to the Company unless the payments are for specified purposes or the subsidiary meets certain financial covenants. Restricted cash and cash equivalents of $14.0 million at June 30, 1996 included $5.9 million for debt service and reserve funds, $2.8 million for operations and maintenance reserves, $2.0 million available for subsidiary operating purposes and $3.3 million for certain construction projects. Restricted funds may be invested only in certain securities. At June 30, 1996, the Company had unused lines of credit available consisting of $14.2 million under a United Thermal Corporation ("UTC") revolving credit facility and $42.5 million under a corporate revolving credit facility. On May 10, 1996, the Company declared a dividend of $.035 per share of common stock to holders of record as of June 28, 1996, payable July 15, 1996. Cash Flow During the six months ended June 30, 1996, cash provided by operating activities was $25.9 million compared to $15.2 million for the comparable period in 1995. Net cash used in investing activities was $14.1 million for the six months ended June 30, 1996 primarily due to capital expenditures of $12.1 million and the initial equity investment of $2.0 million in the Grays Ferry Cogeneration Facility. Net cash used in financing activities was $14.5 million in 1996 principally reflecting debt repayments. Debt At June 30, 1996, the Company's long-term debt (including the current portion) was $231.4 million or 61.8% of total capital, at a weighted average annual interest rate of approximately 7.11% (based on 6 month LIBOR of 5.59% per year) and an average remaining maturity of 6.7 years. Certain of the Company's debt is variable rate or rate capped. Based upon the debt balances at June 30, 1996, a change in the LIBOR rate of .25% would have a corresponding change in interest expense of approximately $300,000 per year when three month LIBOR is under 6.25% ranging to approximately $100,000 per year when three month LIBOR is over 7.25%. Future Capital Expenditures The Company's planned capital expenditures for upgrades, expansions, environmental matters and other improvements are material. The Company believes that cash provided by operations, net of debt service, cash balances at June 30, 1996 and available credit facilities will be sufficient to finance its capital program and several new development projects. On March 11, 1996, a wholly-owned subsidiary of the Company became a one-third partner in the Grays Ferry Cogeneration Facility. Under the terms of the Partnership Agreement, in addition to its initial equity investment, the Company is required to contribute $10 million when construction is completed, which is expected in the last quarter of 1997. Part II - Other Information Item 4. Submission of Matters to a Vote of Security Holders The annual meeting of security holders was held in Boston on May 10, 1996. The security holders voted, as recommended by management, for the election to the Board of Directors of Messrs. George F. Keane, Thomas R. Casten and Patrick Desnos (11,121,605 votes for and 25,319 votes withheld) and for ratification of the selection of KPMG Peat Marwick LLP as the Company's independent certified public accountants (11,146,636 votes for and 288 abstained). Item 6. Exhibits and Reports on Form 8-K (a) The following exhibits are filed as part of this report: 11 - Computation of Earnings Per Share 27 - Financial Data Schedule (b) No reports on Form 8-K were filed for the three months ended June 30, 1996. 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. TRIGEN ENERGY CORPORATION /s/ David H. Kelly David H. Kelly Chief Financial Officer /s/ Daniel J. Samela Daniel J. Samela Controller Date: August 14, 1996 EX-11 2 COMPUTATION OF EARNINGS PER SHARE
EXHIBIT 11 TRIGEN ENERGY CORPORATION AND SUBSIDIARIES Computation of Earnings Per Share (All amounts in thousands, except share and per share data) Three Months Ended June 30, Six Months Ended June 30, 1996 1995 1996 1995 Earnings Per Share -Primary Net income $2,498 $2,140 $6,679 $5,398 ====== ====== ====== ====== Weighted average number of common and common equivalent shares applicable to primary earnings per share calculation 11,506,844 11,386,362 11,488,251 11,379,581 Dilutive effect of stock options 59,500 64,888 61,902 79,765 ---------- ---------- ---------- ---------- Weighted average number of shares outstanding 11,566,344 11,451,250 11,550,153 11,459,346 ========== ========== ========== ========== Net income per share - primary $ 0.22 $ 0.19 $ 0.58 $0.47 ======= ======= ======= ====== Earnings Per Share - Assuming Full Dilution Net income $ 2,498 $ 2,140 $ 6,679 $ 5,398 Plus: Interest on convertible subordinated debt (net of taxes) 152 109 304 218 ------- ------- ------- ------- Net income for fully diluted earnings per share calculation $ 2,650 $ 2,249 $ 6,983 $ 5,616 ======= ======= ======= ======= Weighted average number of common and common equivalent shares applicable to fully diluted earnings per share calculation Weighted average number of shares outstanding 11,506,844 11,386,362 11,488,251 11,379,581 Shares issuable upon conversion of subordinated debt 264,901 283,688 264,901 283,688 Dilutive effect of stock options 59,500 64,888 61,902 79,765 ---------- ---------- ---------- ---------- 11,831,245 11,734,938 11,815,054 11,743,034 ========== ========== ========== ========== Net income per share assuming full dilution $ 0.22 $ 0.19 $ 0.59 $ 0.48 ====== ====== ====== ======
EX-27 3 FINANCIAL DATA SCHEDULE FILED WITH FORM 10-Q
5 This schedule contains summary financial information extracted from SEC Form 10-Q for quarter ending June 30, 1996 and is qualified in its entirety by reference to such financial statements. 1,000 6-MOS DEC-31-1996 JUN-30-1996 $17,448 0 $23,001 $859 $6,481 $46,015 $400,595 $54,629 $445,611 $46,752 $218,740 0 0 $115 $126,038 $445,611 0 $134,904 0 $113,439 $504 $162 $9,465 $11,334 $4,655 $6,679 0 0 0 $6,679 .58 .59
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