-----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, Q5jQ/N0Al5TRDNyVXCAcbdrMGqFsrtJOVAPEHxSpr0DyRWTzGvOAW8b++OlS8EXD FMeJmKG+gxggc8Q0Fg7xIA== 0000350563-97-000029.txt : 19970515 0000350563-97-000029.hdr.sgml : 19970515 ACCESSION NUMBER: 0000350563-97-000029 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 19970331 FILED AS OF DATE: 19970514 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: TAMPA ELECTRIC CO CENTRAL INDEX KEY: 0000096271 STANDARD INDUSTRIAL CLASSIFICATION: ELECTRIC SERVICES [4911] IRS NUMBER: 590475140 STATE OF INCORPORATION: FL FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-05007 FILM NUMBER: 97604579 BUSINESS ADDRESS: STREET 1: 702 N FRANKLIN ST STREET 2: TECO PLZA CITY: TAMPA STATE: FL ZIP: 33602 BUSINESS PHONE: 8132284111 MAIL ADDRESS: STREET 1: TAMPA ELECTRIC CO STREET 2: TECO PLAZA 702 N FRANKLIN ST CITY: TAMPA STATE: FL ZIP: 33602 10-Q 1 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 March 31, 1997 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 1-5007 TAMPA ELECTRIC COMPANY (Exact name of registrant as specified in its charter) FLORIDA 59-0475140 (State or other jurisdiction (IRS Employer incorporation or organization) Identification No.) 702 North Franklin Street, Tampa, Florida 33602 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (813) 228-4111 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 Number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date (April 30, 1997): Common Stock, Without Par Value 10 FORM 10-Q PART I. FINANCIAL INFORMATION Item 1. Financial Statements In the opinion of management, the unaudited financial statements include all adjustments necessary to present fairly the results for the three-month periods ended March 31, 1997 and 1996. Reference should be made to the explanatory notes affecting the income and balance sheet accounts contained in Tampa Electric Company's Annual Report on Form 10-K for the year ended Dec. 31, 1996 and to the notes on page 6 of this report. - 2 - FORM 10-Q BALANCE SHEETS (in thousands) March 31, Dec. 31, 1997 1996 Assets Property, plant and equipment, at original cost Utility plant in service $3,553,984 $3,536,573 Construction work in progress 41,348 40,202 3,595,332 3,576,775 Accumulated depreciation (1,328,575) (1,298,496) 2,266,757 2,278,279 Other property 6,089 6,006 2,272,846 2,284,285 Current assets Cash and cash equivalents 5,463 108 Receivables, less allowance for uncollectibles 100,976 128,791 Inventories, at average cost Fuel 63,779 56,968 Materials and supplies 41,927 41,220 Prepayments 2,670 3,480 214,815 230,567 Deferred debits Unamortized debt expense 17,082 17,429 Deferred income taxes 103,633 102,914 Regulatory asset - tax related 44,088 44,816 Other 52,007 43,220 216,810 208,379 $2,704,471 $2,723,231 Liabilities and Capital Capital Common stock $ 935,517 $ 935,516 Retained earnings 182,607 191,662 1,118,124 1,127,178 Preferred stock, redemption not required 19,960 19,960 Long-term debt, less amount due within one year 660,854 661,103 1,798,938 1,808,241 Current liabilities Long-term debt due within one year 1,060 1,045 Notes payable 81,000 98,600 Accounts payable 124,615 117,323 Customer deposits 53,458 52,867 Interest accrued 20,524 12,070 Taxes accrued 8,873 7,399 289,530 289,304 Deferred credits Deferred income taxes 354,535 359,497 Investment tax credits 52,690 53,837 Regulatory liability - tax related 79,614 80,587 Other 129,164 131,765 616,003 625,686 $2,704,471 $2,723,231 The accompanying notes are an integral part of the financial statements. - 3 - FORM 10-Q STATEMENTS OF INCOME (in thousands) For the three months ended March 31, 1997 1996 Operating revenues $272,786 $254,746 Operating expenses Operation Fuel 88,691 96,292 Purchased power 10,814 9,556 Other 40,339 39,414 Maintenance 16,741 14,513 Depreciation 34,937 28,918 Taxes, federal and state income 15,972 11,263 Taxes, other than income 23,417 22,585 230,911 222,541 Operating income 41,875 32,205 Other income Allowance for other funds used during construction 47 5,019 Other income (expense), net (145) (114) (98) 4,905 Income before interest charges 41,777 37,110 Interest charges Interest on long-term debt 10,701 9,872 Other interest 3,135 3,314 Allowance for borrowed funds used during construction (18) (2,051) 13,818 11,135 Net income 27,959 25,975 Preferred dividend requirements 220 892 Balance applicable to common stock $ 27,739 $ 25,083 The accompanying notes are an integral part of the financial statements. - 4 - FORM 10-Q STATEMENTS OF CASH FLOWS (in thousands) For the three months ended March 31, 1997 1996 Cash flows from operating activities Net income $ 27,959 $ 25,975 Adjustments to reconcile net income to net cash: Depreciation 34,937 28,918 Deferred income taxes (5,926) (10,379) Investment tax credits, net (1,147) (1,185) Allowance for funds used during construction (65) (7,070) Deferred recovery clause 5,109 1,364 Deferred revenues (7,283) 20,869 Refund to customers (5,888) -- Amortization of coal contract buyout 676 676 Receivables, less allowance for uncollectibles 27,815 12,536 Fuel inventories (6,811) 16,829 Taxes accrued 1,474 28,401 Accounts payable 13,180 (40,872) Other 146 13,289 84,176 89,351 Cash flows from investing activities Capital expenditures (23,977) (53,628) Allowance for funds used during construction 65 7,070 (23,912) (46,558) Cash flows from financing activities Proceeds from contributed capital from parent -- 35,000 Proceeds from long-term debt -- 3,058 Repayment of long-term debt (295) (280) Net decrease in short-term debt (17,600) (45,600) Dividends (37,014) (34,965) (54,909) (42,787) Net increase in cash and cash equivalents 5,355 6 Cash and cash equivalents at beginning of period 108 3,832 Cash and cash equivalents at end of period $ 5,463 $ 3,838 The accompanying notes are an integral part of the financial statements. - 5 - FORM 10-Q NOTES TO FINANCIAL STATEMENTS A. Tampa Electric Company is a wholly owned subsidiary of TECO Energy, Inc. B. The company has made certain commitments in connection with its continuing construction program. Total construction expenditures are estimated to be $122 million for 1997. C. During the first three months of 1997, the company recognized $7.3 million of revenues that had been deferred in 1995 and 1996 pursuant to regulatory agreements approved by the Florida Public Service Commission (FPSC). The company deferred $20.9 million of revenues during the first three months last year. The company also refunded to customers $5.9 million of previously deferred revenues during the first quarter of this year in accordance with the agreements. As of March 31, 1997, $53 million of deferred revenues were included in other deferred credits. An additional $13.7 million were classified in accounts payable to reflect the remaining amount to be refunded to customers through September 1997. D. As previously disclosed in its Annual Report on Form 10-K for the year ended Dec. 31, 1996, TECO Energy entered into an Agreement and Plan of Merger with Lykes Energy, Inc. ( Lykes Energy ) on Nov. 21, 1996. Concurrent with this merger, Lykes Energy s natural gas distribution subsidiary will be merged into Tampa Electric. Completion of the mergers is expected to occur by mid-year 1997. - 6 - FORM 10-Q Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Results of Operations Three months ended March 31, 1997: Net income of $28.0 million in the first quarter of 1997 was $2.0 million or 8 percent higher than 1996's first quarter as increased operating income more than offset the absence of capitalized financing costs (AFUDC). Operating income was higher than in 1996 because of the company s regulatory agreements and the completion of Polk Unit One and its inclusion in rate base for earnings purposes. Revenues increased 7 percent this year as the company recognized $7 million of previously deferred revenues under the company s regulatory agreements, while $21 million of revenues were deferred last year under these agreements. Revenues before the recognition of deferred revenues this year decreased 4 percent from last year s revenues before the revenue deferral due to lower retail energy sales. Retail sales declined 5 percent as customer growth of 2.3 percent was more than offset by the effects of mild winter weather in 1997 compared to colder than normal weather in 1996. Operating expenses for the first quarter, excluding federal and state income taxes, were 2 percent higher than in 1996 primarily as a result of the operation of Polk Unit One. T h e effective income tax rate for the first quarter was 36.2 percent compared to 30.1 percent last year, primarily due to less AFUDC-other in 1997. Total AFUDC decreased in 1997 because the company s Polk Power Station began commercial service at the end of 1996's third quarter. - 7 - FORM 10-Q Interest expense before the allowance for borrowed funds used during construction was 5 percent higher in the current quarter reflecting higher levels of long-term debt and interest accrued on revenue deferrals. - 8 - FORM 10-Q Liquidity, Capital Resources and Changes in Financial Condition Fuel inventory increased reflecting the seasonal build-up in anticipation of summer generation. Tampa Electric currently anticipates that, concurrent with the merger of Lykes Energy into TECO Energy, the company will redeem all outstanding shares of Series A, B and D $100 par value Preferred Stock at the applicable per share redemption prices, plus accrued but unpaid dividends to the date of redemption. Also at that time, Lykes Energy s natural gas distribution subsidiary will be merged into the company. - 9 - FORM 10-Q PART II. OTHER INFORMATION Item 4. Submission of Matters to a Vote of Security Holders Pursuant to a written consent in lieu of annual meeting of shareholders dated April 16, 1997, TECO Energy, Inc., the holder of all of the outstanding common stock of the registrant, elected the following directors: Girard F. Anderson DuBose Ausley Sara L. Baldwin Hugh L. Culbreath James L. Ferman, Jr. Edward L. Flom Henry R. Guild, Jr. Timothy L. Guzzle Dennis R. Hendrix Robert L. Ryan William P. Sovey J. Thomas Touchton John A. Urquhart James O. Welch, Jr. In April, in conjuction with a tender offer for its preferred stock, the Company solicited consents from preferred shareholders to the merger of Lykes Energy s natural gas distribution subsidiary into the Company. The tender offer expired May 6 without achieving the requisite consents. - 10 - FORM 10-Q Item 6. Exhibits and Reports on Form 8-K (a) Exhibits 12. Ratio of earnings to fixed charges. 27. Financial data schedule. (EDGAR filing only) (b) Reports on Form 8-K No reports on Form 8-K were filed during the quarter to which this report relates. The registrant filed a Current Report on Form 8-K dated April 16, 1997 reporting under "Item 5. Other Events" on the shareholder approval of TECO Energy s 1997 Director Equity Plan as an amendment and restatement of TECO Energy s 1991 Director Stock Option Plan. - 11 - FORM 10-Q SIGNATURES 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. TAMPA ELECTRIC COMPANY (Registrant) Date: May 14, 1997 By: /s/ W. L. Griffin W. L. Griffin Vice President - Controller (Principal Accounting Officer) - 12 - FORM 10-Q INDEX TO EXHIBITS Exhibit No. Description of Exhibits Page No. 12. Ratio of earnings to fixed charges 14 27. Financial data schedule (EDGAR filing only) -- - 13 - EX-12 2 FORM 10-Q Exhibit 12 TAMPA ELECTRIC COMPANY RATIO OF EARNINGS TO FIXED CHARGES The following table sets forth the company's ratio of earnings to fixed charges for the periods indicated. Three Months Twelve Months Ended Ended Year Ended December 31, (1) (2) March 31, 1997 March 31, 1997 1996 1995 1994 1993 1992 4.00x 4.79x 4.64x 4.50x 4.11x 3.98x 4.16x For the purposes of calculating this ratio, earnings consist of income before income taxes and fixed charges. Fixed charges consist of interest on indebtedness, amortization of debt premium, the interest component of rentals and preferred stock dividend requirements. (1) Includes the effect of restructuring charge of $21.3 million pretax. The effect of this charge was to reduce the ratio of earnings to fixed charges. Had this non-recurring charge been excluded from the calculation, the ratio of earnings to fixed charges would have been 4.52x for the period ended Dec. 31, 1994. (2) Includes the effect of the non-recurring $10 million pretax charge associated with a coal pricing settlement. The effect of this charge was to reduce the ratio of earnings to fixed charges. Had this non- recurring charge been excluded from the calculation, the ratio of earnings to fixed charges would have been 4.17x for the year ended Dec. 31, 1993. - 14 - EX-27 3
UT THE SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE TAMPA ELECTRIC COMPANY BALANCE SHEETS, STATEMENTS OF INCOME AND STATEMENTS OF CASH FLOWS AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 0000096271 Tampa Electric Company 1000 DEC-31-1997 JAN-1-1997 MAR-31-1997 3-MOS PER-BOOK 2,266,757 6,089 214,815 216,810 0 2,704,471 118,919 816,598 182,607 1,118,124 0 19,960 660,854 0 0 81,000 1,060 0 0 0 823,473 2,704,471 272,786 15,972 214,939 230,911 41,875 (98) 41,777 13,818 27,959 220 27,739 36,794 10,701 84,176 0 0
-----END PRIVACY-ENHANCED MESSAGE-----