ML19329E291

App B Annual Financial Rept 1969

ML19329E291
Person / Time
Site:	Palisades, Big Rock Point, Midland  File:Consumers Energy icon.png
Issue date:	12/31/1969
From:	CONSUMERS ENERGY CO. (FORMERLY CONSUMERS POWER CO.)
To:
References
NUDOCS 8006120592
Download: ML19329E291 (40)

Text

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g APPENDIX B REGULATORY DOCKET FILE COPY Consumers Power Company Annual Report

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l Consumers Power Company Annual Report 1969 212 WEST MICHIGAN AVENUE. JACKSON. MICHIGAN 43201 l

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1 Increase or (decrease)

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Highlights 1969 cver 1968 1959 AVERAGE ANNUAL GROWTH RATE SINCE 1959 ELECTRIC REVENUE $ 308.000.000 $ 21,754.000 s 168.485.000 m 8.3%

GAS REVENUE 240.536.000 22.854.000 87.937.000 - 17.4%

TOTAL OPERATING REVENUE 549.775.000 44.656.000 257.525.000 m 11.3%

COST OF FUEL USE0 IN ELECTRIC GENERATION 59.091.000 2.962.000 29.356.000 m 10.1%

COST OF NATURAL GAS SOLO 106.888.000 12.959.000 34.412.000 - 21.1%

TOTAL PAYROLL INCLUDING CONSTRUCTION 108.750.000 7.968.000 63.143.000 m 7.2%

TAXES 96.530.000 (2.655.000) 50.296.000 m 9.2%

EARNINGS AVAILABLE TO COMMON STOCK 63.426.000 4.417.000 34.709.000 m 8.3%

b EARNINGS PER SHARE OF COMMON STOCK-AVERAGE (adjusted) 2.79

.19 1.78 m 5.7%

CASH DIVIDEN0S PAIO PER SHARE ON COMMON STOCK (adjusted) 1.90

- 1.11 7.1%

KILOWATTHOUR SALES 18.479.363.000 868.753.000 9.032.260.000 10.5%

PEAK LOAO-KILOWATTS 3.377.000 197.000 1.795.000 m 8.8%

ELECTRIC GENERATING CAPACITY-KILOWATTS 3.411.000 39.000 2.271.000 5.0%

GAS SALES (1.000 CUBIC FEET) 281.762.000 27.291.000 98.535.000 18.6%

MAXIMUM 24-HOUR NATURAL GAS SEN00UT (1,000 CUBIC FEET) 1,735.000 44.000 602.000 18.8%

ELECTRIC CUSTOMERS 1.057.700 25.800 858.500 m 2.3%

GAS CUSTOMERS 830.000 31.700 509.500 6.3%

COMMON SHAREHOLDERS 87.400 (600) 65.000 m 3.4%

UTILITY PLANT-COST $ 2.111.000.000 $186.918.000 $1.032.575.000 10.4%

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sw hmmmmme A. H. AYMOND JAMES H. CAMPBELL 2

AU Dear Fellow Shareholders:

Whatever else may be said pany of 8.4 percent. An earlier the full amount of its requested about 1969, it was a year of issue of $50 million was sold increase of $57.8 million. How-kaleidoscopic events.

in June, at a cost to the Com-ever, the increase granted is a in the 12 months ended pany of 7.7 percent.

helpful in, offsetting in part in-December 31,1969, Con-m A regrettable and unhappy ationary mcreases in costs.

sumers Power Company sold event of 1969 was an 83-day a In July, the Federal Power more electricity and more natu-strike by the Company's oper-Commission granted Con-ral, gas than m any other year ating, maintenance and con-sumers Power Company and in its history, struction employees-about half The Detroit Edison Company a Electn,c and gas revenues the work force---who are repre-a license to construct a large and Consumers Power Com-sented by the Utility Workers pumped storage hydroelectric pany's total plant investment Union of America (AFL-CIO).

plant near Ludington, Michigan.

reached new heights.

Despite the work stoppage, the Consumers Power will own 51 m Expenditures for new plant Company was able to continue percent of the plant, and Detroit and other facilities totaled servingits1.5 million customers Edison 49 percent, and each

$205,100,000 in 1969, and the with electricity and natural gas will share proportionately in its Company's plant investment, through the services of its generatmg capacity.

stated at original cost, reached executive, administrative and a The Company's capital ex-

$2,111,000,000 at the end of professional personnel, and its penditure program for 1970 is the year.

office and technical employees.

approximately $232,000,000.

m Gross operating revenues in 1969 were $549,775,000, an m On September 29,1969 Financing a program of this w,

increase of 8.8 percent over after extensive hearings, the magnitude und,er current con-1968whengross revenueswere Michigan Public Service Com.

ditions is a major undertak,ing.

mission issued an order author-As part of the Company',s con-

,$505,119,000. These revenues izing the Company to increase tinuing program of keepi,ng the included $308,000,000 from electnc customers,6240,536,000 its rates by approximately six financial community advised of from natural gas customers and percent for electric service, and its activities, officers of Con-

$1,239,000 from customers by approximately 10 percent for sumers Power appeared before purchasing steam.

natural gas. In all, the Commis_

the New York Society of Se-sion granted the Company curity Analysts in December.

m Net income in 1969 was authority to increase its gross The results of 1969 were re-S66,960,000, an increase of seven percent over 1968. Earn-operating revenues by $37.8 viewed, and plans and pros-dects for the future were P

mgs per share of common stock million annually. The new rates iscussed.

became effective October 22.

9 re $

h.c"o "p Both the Company and Attorney General of Mich,the

,a Attention of shareholders is ed t9 2 0 Per igan invited to a special section of share in 1968.

have appealed the rate order to this Annual Report dealing with n On the other hand, a record the courts, for differing reasons the' environment. This is not a also was established in 1969 which are detailed in the body new problem, and it is one that in the cost of borrowed money.

of this Annual Report.The concerned the Company for The Company sold $55 million Company's appeal expresses many years. Because of its in first mortgage bonds in the conviction that the Com-overriding importance in today's November at a cost to the Com-mission should have granted world, it is worthwhile making O

U 3

note of tha Company's accom-plishments and its plans for the future in this very important area.

m A year ago, the 1968 Annual Report inc uded a special sec-tion explaining the seriousness of continued inflation, and its impact on Consumers Power Company. It set forth clearly the need for taking inflationary pressures into account in pric-ing the Company's products and services. The rate increases granted by the Public Service Commission in 1969 reflect in part an adjustment to this impact. Nevertheless, inflation Electric Revenue increased con "

p,gb m During the period 1959-1969, annual electnc revenues rose $139.514.000, or a There are differences of 82.8%. In 1969. electric revenue opinion as to the,cause of the amounted to $308.000.000, a 7.6% in-sharp nse in inflation in the last crease over 1968.

few years; but it can be stated categorically that corporate Gas Revenue Increased profits are not a factor. Indeed, in spite ofincreased investment, Annual gas revenues rose $152.599.000, corporate profits in the nation or 173.5%, during the period 1959-1969.

as a whole are no higher than Gas revenue of $240.536.000 in 1969 they were four years ago.

represented a 10.5% increase over 1968 m From the customer's point-of-view, it is worth noting that, Electric, Gas Systems Expanded despite higher rates, electricity For the years 1959 to 1969, the Company and natural gas remain ex-nvested $1.354.861.000 in construction tremely low-cost sources of essential energy. Indeed, in projects required to keep pace with grow-ing demands for electricity and natural gas commentin,g on the soar,ng throughout the service area. The 1969 i

costs of services, U.S. News &

expenditure for enlargement and improve-World Report puts the average ment of facilities was $205.100.000. The electric bill and the average gas bill at the bottom of the list of p anaed expansion program during the first half of the 1970's includes construction price increases over the last five years.

of three major electric generating plants which will add 2.829.000 kilowatts in m in short, even with inflation, capacity to the Company's system, and r

electricity and natural gas re-substantial extension and enlargement of main among the best bargains gas system facilities.

in the family budget.

hmber of Custorners Rose Sincerely, The number of electric customers served increased 200.000 and the number of gas customers served increased 321.000 in Chairman of the Board the period 1959-1969. The Company was serving 1.058.000 customers with elec-tricity and 830.000 customers with natu-M rai gas at year-end 1969. During the year, the Company added 25.800 new electric resident customers and 31.700 gas customers.

all gas customers. 676.000, or 81.4%. us February 16,1970 gas to heat their homes.

4

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ELECTRIC REVENUE 19591969 PLANT ADDITIONS AND IMPROVEMENTS 19591963 330 240

$308.000.000 in 1969 ) m s205.000.000 in 1959 300 y

270 b

80 240

$168.000.000 0

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1 1 150 in 1959 f.i d sj j d el

.000.000 R

180 150 120 90 - -

90 60 - - - -

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59 60 61 62 63 64 65 66 67 68 69 59 60 61 62 63 64 65 66 67 68 69 E RESIDENTIAL E COMMER CAL E ELECTRIC D INDUSTRIAL G OTHER E GAS O OTHER GAS REVENUE 1959-1969 NUMEER OF GAS AND ELECTRIC CUSTOMERS 19591969

$241.000.000 in 1969 > d 8 0000 as& C58 H

1100 y

210 d

1000 E

19 5 El c Cus:cmers in 1959 l

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$89.000.000

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0 59 60 61 62 63 64 65 66 67 68 69 59 60 61 62 63 64 65 66 67 68 69 O

E RESIDENTIAL USING GAS FOR SPACE HEATING E OTHER RESl0ENTIALE GAS CUSTOMERS DINDUSTRIAL AND COMMERCIAL U OTHER E ELECTRIC CUSTOMERS i

5

The Company and the Environment For more than 50 years, Consumers Power Company has been concerned with protecting Michigan's environment. This long and proud record includes careful management of more than 700 miles of riverlands. It also includes application of the most efficient technologies available to protect and improve the quality of air and water. What the Company has done in the past, and what it is planning for the future, is detailed below.

As the 1960's drew to a close, living in walled cities fouled does it involve turning off air millions of Americans began to the air with smoking hearth conditioners, abolishing the be personally concerned with fires, and tossed garbage and automobile, and uninventing the the protection and preservation sewage into the streets. It wheel. Rather, the solution lies of their environment.

continued, in even larger pro-People living in Michigan portions, as a result of the were no exceptions. They felt industrial revolution. Smoke anxiety-and expressed it-plumes from factory chimneys about air pollution, water pollu-were regarded as banners of i

tion, pesticides, and other prosperity.. even while every l

hazards to their well-being.

nearby home was blackened Frequently, they reacted angrily by soot.

A scale model of the 880 acre cooling pond planned for the Midland nucle with demands for instant solu-Forests, too, were chopped power plant is used by engineers to stu tions.. only to learn that there down or burned off, and nvers heat dissipation and water flow. Th are none. Solutions could be ravaged. The horizon seemed pond's purpose is to receive water that has had, to be sure. But they would unlimited. There were always become heated while circulating through take time, money, and the in-new lands, further west. Or so the steam condensers, then circulate the volvementof business, industry, it seemed. And, as one area water until it cools sufficiently for reuse and government. Most impor-became unfit for use, the men in.the cooling cycle. Thus plant operations tantly, the solutions would re-responsible moved on.

will have no thermal impact on local quire involvement of people, bodies of water.

themselves.

Frontiers are Gone Extensive studies which were begun several The basic components of the years before scheduled completion of the environment are land, air, and But now, in a practical sense, Palisades nuclear plant are aimed in part water. These components have these frontiers are gone. Man at assuring that plant operations will have a

the capacity to assimilate a cer-no longer can ruin his environ-no harmful effects on water quality in Lake

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tain amount of the products ment, then pick up and move Michigan, on which the plant is located.

and by-products of human ac-to greener pastures. We are an Offshore from the plant site, samples are tivitywithout significant adverse expanding people aboard a dredged fram the lake bottom to be analyzed effects. But when an overloao non-expandable planet, with to determine chemical and biological is placed on them byan expand-finite resources.

makeup for future reference.

ing population enjoying a high Rep. Craig Hosmer (R. Calif.),

standard of living, the balance of the Joint Committee on At the 8. C. Cobb electric generating of the environment can be Atomic Energy of the U. S.

(a n r k 9" st ll !'

ofbs ed 69 oi erie upset.

Senate and House of Repre-electrostatic precipitators added for im-sentatives, put it this way:

proved air quality control. The new equip-Environmental protection ment removes virtually all particulate Man's Impact Not New does not necessarily mean send-matter from stack emissions, and repr Man's impact on the environ-ing the world back to whence sents one phase in an $18 millia ment is not new. It existed in it came to be refurbished in its three-year air quality control program in-medieval times, when people original pristine condition, nor volving four major electric plants.

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in achieving a satisfactory ac-In strict fact, no electric gen-of fuel for generating electricity.

commodation between the de-erating station can produce and millions of tons are burned

[] - mands of the environment and.

power without SOME effect on every year in the Company's U the social benefits of technol-the environment. This is the plants.

ogy."

necessary price which must be Year-by-year, as the Com-Insofar 'as the electric utility paid for adequate and reliable pany has constructed plants, it business is concemed, this is energy. Yet the use of electric-has installed the best kind of another way of saying that the ity can, in itself, make possible equipment available for air nation has two goals, each of a cleaner environment than any quality control. Yet today, which is desirable, but in which other altemative.

mechanical dust collectors are some accommodation must be Rep. Chet Holifield (D. Calif.),

relatively inefficient when com-

. made. The first is the assurance Chairman of the Joint Commit-pared to modern, electrostatic of adequate supplies of reliable, tee on Atomic Energy pointed precipitators which remove reasonably-priced electric en-out, recently, tha.t the substitu-more than 99 percent of the ash ergy. The second, the need for tion of electric energy for other resulting from coal combustion.

clean, healthy and aesthetic energy sources in many indus.

Electrostatic precipitators surroundings.

trial operations could eliminate were installed when the Karn John Nassikas Chairman of certain forms of pollution.

and Campbell plants were built.

the Federal Power Commission, "By electrification," he said.

And the Company has com-said:

"we can eliminate much ineffi-mitted S18 million to a three-

"We cannot settle for the cient combustion of fuels and year program of installing such Hobson's choice of either elec-rely more onlarge scale, highly piecipitators and other environ-tric power in a degraded envi-efficient and clean combustion mental quality equipment at its ronment, or a pristine environ-of fuels which is attainable in other major coal-buming plants ment with no electric power."

modem central station power which were constructed earlier.

plants. By proper considera-Electrostatic precipitators tions of siting, clustering of recently were installed at the plants, and transmission of clean B. C. Cobb plant, near Muske-I )

electrical energy, a significant gon. Work will begin in 1970 improvement can be made in on installation of such precipi-the quality of our environment."

tators at the J. C. Weadock The Company encourages underground plant, near Essexville. And pre-electric service, and its aesthetic benefits continued to gain populanty as more than Nuclear Plants Help limin ry engineering is going forward on air quality control half the new residential subdivision hous.

And he added: " Nuclear equipment to be installed at the ing added in 1969 was built with under-power plants can make a mean-Justin R. Whiting plant, near ground electric distribution lines. At the ingful contribution towards the Erie.

year-end. 26,0000f the Company's electric reduction of pollution now at-customers were receiving underground tributed to the electric power Morrow Plant

sennce, industry."

Converted During the year, the B.E. Morrow gener.

By thoughtful planning and At some plants, conversion g

ating plant, near Kalamazoo, was con-carefulengineering, Consumers to natural gas is possible. Th.is verted to natural gas fuel one full year

. Power Company is endeavor-has been done at the Company's ahead of the original schedule under the ing to maintain the necessary Bryce E. Morrow plant, near Company's air quality control progrr,m.

Lalance between nature and Kalamazoo. There the boilers -

Other major electric plants that will con.

technology. Plant siting takes have been converted to gas a tinue to use coal for fuel either have, or the environment into consider-full year ahead of the schedule are getting, the latest in air quality ation. Transmission lines are approved by the Michigan Air control equipment.

designed to reduce excessive Pollution Control Commission.

visibility to nearby communities.

The Companymeanwhile has Engineers at the Palisades plant use And more than half of all new scheduled retirement of several microwave and shortwave radio equipment residential subdivisions now are older, coal-fired plants. These to guide a. patrol boat to more than 20 being built with their electric will be phased out progres-distribution lines underground.

sively, starting in 1970. Thus, ee rann ent r se : h, i

in

'd ciudes studies of fish Nfa as well as air Air quality control is an %-

by 1973, the Company will tests to measure levels of neural radio.

portant element of this program have completed its program to activity in the area, wi!* cc,tinue after for environmental protection.

reduce to a minimum therelease the plant begins operating in 1970.

Coal remains the major source of smoke and ash from its 9

o

coal-burning generating plants.

Water Resources Commission harmful to the environment, the,

A difficulty yet to be over-of Michigan, which must be Company will act promptly t come is the emission of sulfur satisfied that water quality will correct the situation. At th dioxide from coal-fired plants, be maintained before it will same time, the Company als High stacks carry off the emis-issue a use permit.

believes that unnecessary sions and disperse it. However, Large nuclear power plants-equipment should not be re-this is not a complete solution, such as the one at Palisades--

quired or built simply because and research continues through-will discharge more heated of unsubstantiated anxiety that out the world in an effort to water than existing power adverse conditions MIGHT find a system of control that is plants. Yet the amounts will exist. To install such equip-technically and economically continue to be minute in rela-ment'without first establishing feas ble. (Low-sulfur coal or oil tion to Lake Michigan. Even so, the need for it would mean i

could be helpful but the the Company is taking pre-penalizing the Company's cus-world supply of low-sulfur fuel cautions to guard against dam.

temers with higher rates with-is insufficient to make it a prac-age to the ecology.

out achieving a meaningful tical solution.)

tion about the environmental qu ality.

To obtain adequate informa.

contyibution to environmental A major advance.in env:ron-mental protection is the con-effects of plant operations, the Cornpany Obligatit.n struction oflarge nuclearplants.

Company is participating in Clear These clean, ouiet, economical comprehensive ecological generating stations can be lo-studies, particularly in Lake The American people have cated near load centers, with-Michigan.

made it known, loudly and re-out necessarily being placed in One of these research projects peatedly, that they will not do unspoiled rural areas. They pro-is measuring temperatures of without electric power. Investor-duce no combustion products, the lake waters at approximately owned utilities like Consumers and adherence to rigid safety 20 locations near the Palisades Power Company are dedicated standards ensures safety from plant, to establish a year-round to the obligation of supplyin radiation.

record before the plant goes that power-adequately, reli into operation. This project will ably, and as economically a Condensers Require be continued after the plant is possible. At the same time, they Cooling Water operational, to provide com-have an obligation to preserve All steam electric plants.

parison readings.

the environment and, whenever whether fired by fossil fuels or Also, a study is being made possible, to make life better for by nuclear fission, require cool-of aquatic life on the lake bot-the people of Michigan. Con-ing water for their condensers.

tom at the same locations near sumers Power Company has a For all Consumers Power Com-Palisades. Another project, long and proud record of doing pany generating stations built being undertaken with several so, not only with well-designed in the last 20 years, this cooling other utilities, consists of taking and efficient generating sta-water has been provided by radiological data at 80 locations tions, but with maintenance of the Great Lakes.

in Lake Michigan to determine more than 700 miles of river-There is no impurity in the conditions existing in advance lands which were acquired in discharge of the water from the of nuclear plant operations.

the early part of the 20th Cen-power plant back into the lake Aquatic life is being inventoried tury to insure reliable water for after it has gone through the at these locations, as well.

hydroelectric power plants.

condenser. However, the water With detailed records devel-Over the years, the Company is warmer than when it was oped in this research, it will be has planted more than 22 mil-taken from the lake; generally possible to know to what de-lion trees, in a wide-ranging on the order of 20 degrees.

gree, if at all, Palisades and reforestation program; and has While the quantities of water other power plants may affect kept all of its riverlands open required for cooling are sub-the ecology and, if so, exactly to the public for hunting, fish-stantial, they nevertheless are how and to what extent it is ing, hiking, and other recrea-minute in relation to the lake, manifest.

tional activities.

itself. The heat dissipates Consumers Power Company Perhaps the simplest way quickly, with no evidence of has on numerous occasions saying it is that Consume damage to the lake. Indeed.

made clear its concern for the Power Company endeavors to prior approval for all plants environment. It has stated that, be a good citizen, wherever it must be obtained from the if a power plant is found to be serves.

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The Company and Michigan's there were 509.000 gas cus-Attomey General each subse-tomers, compared to 830.000 quently challenged the rate at the end of 1969.

Chairman Aymond orders in court, and these ap-In terms of plant investment, Elected President of j

peals were pending at the end the Company's total plant at Edison Electric of the year. A discussion of the end of 1959 represented Institute these appeals will be found investment of $1,032.575,000.

further on in this report A decade later, at the end of Consumers Power Company's leadership 1969, plant investment had role in the investor-owned electric utility Company Revenues risen to $2.111,000,000.

industry was reemphasized in 1969 wher; Improved with The Company rendered serv-A. H. Aymond, chairman of the board and New Rates ice in 64 of the 68 counties of chief executive officer, was elected presi-Michigan's lower peninsula dent of the Edison Electric Institute. eel Aided to some extent by higher then, compared with 67 today, is the national trade association of in-rates in the last two months of and its service area was vetor-owned electric power companies.

the year, total electric revenue 28,700 square miles, compared its 181 electric operating company mem-climbed to S308.000,000 in with 30,800 square miles being bers serve more than 97% of all customers 1969, an increase of eight per-served today. The total number served by investor-owned companies and cent over 1968. Gas revenue of communities being served more than 76% of all electric customers totaled $240,536,000, an in-then was 1,630, as against in the United States.

crease of 11 percent over the 1,886 at the end of 1969.

Prior to his election as presioeni, Mr.

previous 12 months. The rate in 1959, the Company re.

Aymond served eel in many capacities, increases that went into effect ported sales of nine billion kil_

as chairman of various committees, as a October 22 were responsible owatthours of electricity, and member of the board of directors and, for approximately $2,600,000 gas sales of 98.5 billion cubic during 1968-69, as vice president.

in electric revenue and feet. In 1969, kilowatthour S4.100.000 in gas revenue.

sales of electricity reached 18.5 Sales of steam in 1969 pro-billion, and volume sales of duced $1,239,000, an increase natural gas totaled 282 billion of four percent.

cubic feet. Thus, electric sales Cash dividends of $1.90 per have increased 105 percent and common share were paid in gas sales 186 percent in just 1969 at the rate of 47% cents 10 years.

per share on February 20, May Total generating capacity was 20 August 20, and November 2.3 million kilowatts in 1959

20. Total cash dividends paid compared to 3.4 million at the on common stock in 1969 end of 1969; and storage capac.

Michigan's outstanding free,way system aggregated $43,262.000. The ity for natural gaswas estimated has created flye major industrial-metropoluan comdors that span the width dividend payable February 20, at 46 billion cubic feet, com-h

["omp njsup d

h be fb a ll'ights 1970, was increased to 50 pared with 140 billion now.

s the cents per share.

Gross operating revenue in installed by the State Highway Department Preferred stock dividends 1959 was $257,525,000, with on limited access freeways throughout the

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paid on January 2. April 1. July net income $38,427,000, and Company's electric service area.

1, and October 1 amounted to earnings per average share of

$3.535,000 in 1969.

common stock outstanding Modem sculpture in a plaza symbolizes

.(adjusted to reflect a stock split progress in urban redevelopment, and sug-A Decade of in 1962, and a 10 percent stock gests substantial growth projected for Significant Growth dividend in 1967) $1.78. A many Michigan cities in the 1970's. This As the Company looks toward decade later, annual gross op_

is,, downtown Grand Rapids, one of 14 the challenges of the 1970's, it erating revenues were cities m the Company s service area with is appropriate to look back over

$549,775,000; net income was p pulations in excess of 50,000.

the 10 years just passed to see

$66,960,000; and eamings per Recreation is a 1.5 billion-dollar-a-year how far the Company has come average share of common stock business in Michigan, and sporting good since December 31,1959.

were $2.79.

stores are well represented among th Ten years ago, the Company A Look at the 1970's 107.700 commercial establishments had 858,000 electric customers, served by the Company with electricity, compared with 1.058,000 at What of the future ?

as well as the 55,400 served with natural the end of 1969. At that time, No one can forecast it with gas.

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certainty. But it is reasonable plies are discovered and pro-to expect that the next 10 years duced.

will bring significant expansion Because of a contract with New High For to Michigan and, in particular.

Trunkline Gas Company, Con-Natural Gas Sendout to the fast-growing area of the sumers Power Company ex-lower peninsula served by Con-pects to receive increasing de-The 1969 high for 24-hour natural gas sumers Power Company, with liveries of natural gas, at least seridout, a system record, was established consequent rising demands for through 1972.

January 25 when 1.735 billion cubic feet energy.

After 1972. much depends were distributed to customers. This was For example, business fore-on the drilling and development in turn exceeded on January 7 and 8 casts suggest that sales to all activities of the major producers 1970, when 1.933 billion cubic feet and categories of electric customers in the Southwest and Gulf Coast 2.074 billion cubic feet respectively were in the Company's service area areas. It is reasonable to ex-required by customers, the latter thus

-exclusive of power pool sales pect, however, that the Com-establishing a new all-time record for

-will rise to 19.8 billion kilo-pany will get its proportional 24 hour2.777778e-4 days <br />0.00667 hours <br />3.968254e-5 weeks <br />9.132e-6 months <br /> gas sendout.

watthours in 1970, and to near-share of additional gas that is in 1969, the Company added a total of ly 44.3 billion kilowatthours available.

46 miles of major natural gas transmission by 1980.

pipeline, bringing the gas system total to The Company expects to sell The Cornpany Must 632 miles. The Company also added 400 approximately 310 billion cubic Expand Its Facilities miles of distribution pipeline, extending feet of gas in 1970. Additional Construction of new facilities the system total to 15,314 miles.

supplies of gas expected in the and modification of existing Consumers Power Company and its wholly-following twoyears should per-facilitiesis a wayoflife for every owned subsidiary Michigan Gas Storage mit the sale of 352 billion cubic utility. Consumers Power Com-Company operate nine natural gas storage feet in 1971, and about 373 pany is engaged in a tremen-fields with a total working storage capa-billion cubic feet in 1972.

dous building program, both in bility of 139.5 billion cubic feet.

In the immediate future, the its electric business and in its Company expects to add gas business.

25.800 new electric customers.

At Palisades, on Lake Mich-and 31.700 new gas customers igan some 35 miles west of during 1970.

Kalamazoo, construction is As demana for energy rises, nearing completion on tbc so does the need for additional Company's newest generating facilities. Thus, Consumers station-a nuclear plant with Power Company expects to the largest single generating The Company's service area is highly spend $1.1 billion in the next unit thus far installed in M: chi-industnalized. Michigan mdustry is di-five years to expand and im-gan. Scheduled for addition to Vyrs ed, th our fths of all categones prove its electric system, an-the system in June or July of sumers Power supplies electricity to 7,300 other $250 million to expand 1970, it will be licensed initially industrial customers, and natural gas to its gas system,and an additbnal to produce 710.000 kilowatts 5,600.

$100 million for other facilities.

of electricity. Later, authcriza-The Company expects to tion is expected to be increased Planting millions of Coho and Chinook obtain increasing supplies of to allcw generation of more salmon in Michigan waterways has pro-natural gas over the next two than 800,000 kilowatts. The vided a strong boost to the state's already or three years to meet the grow-cost of the plent is approxi-extensive tourist and recreation industry.

ing requirements of its cus-mately $122 million.

These are Chinooks taken in the Manistee tomers. However, the dilemma Meanwhile, also on Lake River, on which the Company owns many facing the entire natural gas in-Michigan and about four miles miles o,f riverlands that are open for public dustry is that for several years south of Ludington, the Com.

recreational use.

regulatory limitations on selling pany has begun construction prices imposed at the national of a large pumped storage Sugar beets are an important crop in Michigan agriculture, which produces tatal level have discouraged the hydroelectric plant. This facility.

revenues of one billion dollars annual search for, and development of, scheduled for completion in The Company serves more than 78.0 new gas reserves. Meanwhile, 1973, will have a maximum farms, which is more than any other utili overalldemands haveincreased capacity exceeding 1.8 million in the nation. Electric use by farm cus-

-and continue to increase-kilowatts. it will be used to tomers in 1969 averaged 1,000 kilowatt-faster than the additional sup-supply needed power at times hours more than the national average.

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of peak demand.

Other construction-such as The Ludington plant is being service buildings, office facili-Electric Utility built jointly by Consumers ties and transportation and Taxation Still Unfair Power Company and The equioment, and heating plant-Three years ago, in the 1966 Annual Detroit Edison Company, with is expected to require invest-Repot, the Management called share-ownership to be 51 percent and mentof about $100 million holders' attention to a serious inequity 49 percent, respectively, and over the next five years.

in taxation of electric utility systems. In proportionate sharing of elec-that report, the Company pointed out that tric power. Consumers Power Five-Year Construction investor owned electric utilities, such as Company's share of the invest-Estixnated at Consumers Power, pay their fair share of ment will be approximately 81.45 Billion

..8130 million. In the early years, Federal income taxes. These are reflected in the rates of each company. However, it is proposed that about one.

Construction plans like these the report continued, government sponsored third of its output will be sold are an impressive commitment electric power systems, which provide to the Commonwealth Edison to the future. Yet they are not about 20% of the electricity in the United Company of Chicago.

excessive. On the contrary, they States, pay no Federal taxes at all.

Finally,in terms of major new are based on very careful analy-Three years later, despite passage of generating capacity, the Com-sis of economic and population tax reform legislation in the interim, no pany is engaged in site work trends, and what the Company change has been made in the unfair nd engineering for a large, management believes to be taxation of electric utilities. Investor, dual-purpose nuclear plant sound j,udgment as to the fa-owned companies still pay their full share near Midland. This will consist cilities needed to meet needs of Federal taxes; govemment-sponsored of two reactors, each the size of the customers in the years electric systems are still completely exempt of the one at Palisades. The ahead.

from Federal taxation.

pl nt will supply 1.3 million In the last five years, Con-The Management of Consumers Power kilowatts to the Michigan sumers Power Company has O

Company believes it is essential that gov.

power pool and, in addition, invested S811 million in new

(,)

emment-sponsored electric projects col.

Will deliver up to four million facilities, including $205 mil-lect and pay their fair share of Federa! taxes pounds of industrial steam, per lion in the year 1969.

and thus contribute in fair proportion to hour, to The Dow Chemical In 1970, projected construc-the rising cost of government.

Company in Midland, tionwillbeon theorderof $232 The Midland facilityis sched-million, and over the five-year uled for completion in two period ending December 31, stages; the first reactor and 1974, expenditures for plant generating unit in 1974, and additions are expected to total the second in 1975. Total cost S1.45 billion. This could rise to of the project is estimated at S1.5 billion if the Company is Almost half of the Company's revenue pproximately $350 million.

able to get all the gas its cus-comes from supplying electricity and natu.

In addition to these large tomers demand, and builds ral gas to homes. The Company added generating stations, the Com-additional gas lines and other a

20,900 residential electric customers and pany expects to invest approxi-facilities thus required.

~

28,800 residential gas customers in 1969.

mately $500 million in addi-To meet this cost over the tional transmission and distri-next five years, it is estimated increasing construction of new apartment bution lines, substations, and that the Company will have to complexes conti,nued to be a strong tre,nd other supporting electric facili-sell about S875 million in new m the residential, market. Many utilue ties over the next five years.

securities. It is anticipated that electnc space heating. The Company ended Expansion of the Company's approximately $140millionwill 1969 with 17,300 electnc space heating natural gas service also is a be raised in 1970 by issuing cus mers in all, up 2,800 from the continuing process. Pipelines, new securities.

compressor stations and under-Increasing Rates is a Michigan's ground storage facilities will crease 15% population is expected to in.

by 1980, Mich will add require considerable investment.

ggg g new schools to the more than 2,500 Indeed, it is estimated that con-The need for raising rates for

'v',

elementary, junior high and high schools struction will average about electric and gas service became served by the Company in 1969. Also by S50 million annually over the apparent in 1968. With each 1980, the number of households is pro-next five years, based on mini-passing month, the costs of jected to increase by 19%.

mum anticipated gas supplies.

doing business increased in-17

exorably. And it no longer was Ingham County Circuit Court CONSUMERS POWER-COMPANY possible to more than partially for permission to put the new ELECTRIC SYSTEM offset these increased costs by electric rates into effect under more efficient operations or bond, against possible refunds.

2 Nuclear Plant technical advancements.

The court granted this petition, E Coal Fired Plant On April 19,1968, the Com-and the electric rates-along pany applied for rate relief in with the newgas rates-became E Gas Fired Plant its natural gas business. This effective October 22,1969.

was followed,on July 15,1968.

The Company subsequeatly E Peaking Plant with application for rate relief filed suit, on October 28, in in the electric business. In all, Ingham County Circuit Court E Hydro Plant the Company asked authority asking that the full amount of i

A Primary Substation to raise its rates suff,ciently to its originai rrte increase petition produce $57.8 million in addi-

-$57.8 million-be allowed.

Transmission Line tional revenue.

The Company, in its appeal, 46.000 Volts There followed many months has taken the position that the of testimony before the Michi-Commission did not authorize Transmission Line gan Public Service Commission.

a reasonable rate of return; that 138.000 Volts The Company presented evi-it failed to determine an ade-T ansmission L.ne dence in support of its case.

quate rate base;and that it did The Commission staff presented not give sufficient recognition its own arguments and conclu-to rising operating costs.

e Interchange of Power sions. And the Attorney General One element of the Commis-of Michigan intervened with sion's rate order requires further still other arguments. He in-explanation.The order provides sisted that no rate increase was for a reduction in rates on re-CONSUMERS POWER COMPANY needed; arguing that, on the duction or termination of the NATURAL GAS SYSTEM contrary, the Commission surcharge on Federal income should order the Company's taxes. As part of its suit, the g,,t;n,,

rates reduced.

Company has taken the posi-Consumers Power Co.

Eventually, on Septem,oer 29, tion that this provision is illegal 1969, the Commission issued and has obtained a temporary Gas Lines an order granting the Company injunction against the enforce-

~ Michigan Gas Storage Co.

authority to raise its electric ment of this provision pending rates approximately six percent, further hearings. The Company

.. Gas Lines and its gas rates approximately argues that if a rate reduction Panhandle Eastern Pipe Line Co.

10 percent to produce $37.8 is to be considered the Com-Compressor Stations million in additional revenue.

mission should review all other

.1 Consumers Power Co.

in accordance with this order, costs of doing business at the the Company filed amended time the surcharge is changed.

Compressor Stations U

rates schedules October 3,1969.

There have been manyincreases Michigan Gas Storage Co.

O

~

These were designed to yield in costs offsetting the reduction p orage Fields St the additional revenues ap-in the surcharge.

proved by the Commission.

The Attomey General, on his Consumers Power Co.

However, the Attorney part, has appealed the Com-General demanded-and was mission's authorization of

, Storage Fields Michigan Gas Storage Co.

granted-further hearings on greater electric and gas reve, the form of the rate structure.

nues, arguing that no rate in-Gas Fields After four days of further testi-creases are required. He also a Consumers Power Co.

mony and cross-examination, has challenged the Comm.is-the Commission approved the sion's order approving the

--- Interconnection with other Gas Co.

new gas rate schedules. The Company's increased gas rates, electric rate schedules were All of these court actions are made subject to additional expected to be heard in 1970.

hearings.

Additional hearings by the To avoid irreparable losswhile Commission on the Company's awaiting these further hearings, electric rate schedules were the Company petitioned the held February 3 and 4,1970.

18

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Company Endured however, was reflected in con-83-Day Strike in 1969 struction, where labor costs went up approximately 15 per-New Electric Prolonged negotiations took cent in 1969.

Records Are Set place in the winter and early The cost of borrowed money A new all-time record sendout of elec-spring of 1969 between the als contimd to rise. in C

d the Utilit tricity was established 0ecember 18,1969 Wo kers Union of America

$55 mi o n

s tga e (AFL-CIO), which represents bonds' 8%% series' due 1990

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approximately one-half the at an interest cost to the Com-ggC9' d

d work force. These negotiations pany of 8.4%. An earlier issue 3 377 000 ki owatts b t veen 6.5 p.m' failed to produce a newworking of $50 million,7%% series, due and 7':00 p'm. On Janua'Y 0' 1970' 2

agreement, and a strike was 1999' was sold in June at an begun April 8. Before a settle-interest cost of 7.7%. In both ment was reached and subse-e tablish as 123'000 ki o a hours cases, these represented higher of electricity were distributed in a 24 hour2.777778e-4 days <br />0.00667 hours <br />3.968254e-5 weeks <br />9.132e-6 months <br /> quent return to work June 30, interest rates than for any pre-d' the Company and its operating vious Company financing.

ndustry survey compiled during 1969 employees endured an 83-day In 1968, the Company sold ranked the Company's electric generating broughout the protracted

[ cost t

• Ystem sinh in th a ion for 19 8 in h

om any of.8 strike, service to the Company's and 6.6%, respectively, and in s

measure of systern efficiency' The Dan E 1,5 million customers was 1967 an S80 million issue at a maintained by executive, ad-cost of 5'9%'

m a' e ent amag au Wual ministrative and professional Taxes represented another e

employees, and by office and major item of cost. In total, technical employees.

Federal. State and local taxes The agreement, as ratified, amounted to S96.530,000 in provided for a contract,expinng 1969. The Company estimates March 31,1971. This included that, of every revenue dollar re-wage increases averaging ceived from its customers. taxes nearly 43 cents per hour in absorbed almost 18 cents.

1969, and approx,mately an One example of rising taxes i

additional 25 cents per hour in s represented by the Com-1970. Provision also was made pany's property taxes, which for a cost-of-living increment, rose significantly in 1969, due ble beg,nn,ng August 1, largely to higher tax rates and i

i Michigan is a national leader in the pro-increasing assessments on duction of mobile hcmes, and they are Other Costs of Company facilities. Total prop-popular within the service area. Approxi-Operation Continued erty taxes in 1969 amounted to mately half of all new electric and gas to Rise

$30,670,000, a 13 percent in-services that will be installed in 1970 crease over the previous year.

are expected to be for mobile homes, r

Wages and salaries, of course, Further increases will become prefabricated homes, or apartments. The are only one of many items of effective in 1970.

Company added 5,500 mobile home cost which are affected by In addition, along with pay-customers m 1969.

inflation.

ing its own substantial taxes.

The price of coal for genera-the Company collected from its The Company's service area includes 50 tion of electricity rose to S7.97 customers $14,420,000 in colleces and universities which strengthen th per ton from $7.80.

Michigan sales tax, which was u it e and con te o a ett There was an,ncrease.in cost-remitted to the State.

i also, for gas purchased from quality of life. Higher education in Michi-gan also oHen ste2dily growing capa-major pipelines.The system Company Won Tast bilities for industrial and other research average cost of gas rose to Decision in and development activities.

37.91 cents per thousand cubic Federal Court feet, from 35.56 cents in 1968.

Communications are extensively develop All types of equipment and The Company's earnings for in the Comoany's service area, which i -

materials also rose in cost, as 1969 were enhanced by a non-cludes 29 daily newspapers.13 television inflation caused suppliers to in-recurring item racorded in the stations, more than 80 radio stations, and crease prices. The greatest rise, last quarter of the year in the more than 200 weekly newspapers.

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amount of $2.5 million.

Board since his election in This was largely the result of April 1967.

a favorable tax ruling on de-in July W. Jack Mosley was Operation Outreach ductibility for Federal ineme elected vice president of the in the 1968 Annual Report, the Company tax purposes of deprec.iatior, on-Company, with responsibility reported the start of a program called cleanng and easement costs.

for bulk power resources and

" Operation Outreach." It is an accele-Although the Internal Revenue planning and power pooling.

rated program to hire, train, and provide Service has appealed some,s-Mr. Mosley formerly had served continuing employment to men and women i

sues, with respect to these two as executive manager, electric who, at one time, were regarded as items, the IRS decided not to operations. He joined Con-unem9 oyable.

t appeal a decision of the U.S sumers Power as power pooling in 1969, " Operation Outreach" con-District Courtin a case affecting director in 1962.

tinued. When the year began,84 persons the Company's tax returns as In July, the Company was were on the payroll under this program.

far back as 1957. The success-saddened by the sudden death During 1969, another 62 persons were ful outcome of this tax case left of L. L. Booth, for 22 years added from the ranks of so-called " dis-the Companywith an over-manager of the Muskegon advantaged." At year-end,101 persons accrual for Federal taxes, and Division. Mr. Booth had served continued in the work force under the this was elimmated as the year the Companywith skill and program; 70 percent have completed their drew to a close.

devotion for 39 years.

probationary employment penod and be-C. Thomas Baylis, previously come regular employees of the Company.

Oil and Gas assistant manager, succeeded Of those hired in " Operation Outreach,"

,Mr. Booth as division manager 45 left the Company. Of these,19 were Exploration Continues in Muskegon. Mr. Baylis joined terminated because they were unable to Northern Michigan Exploration the Company in 1946, and adjust satisfactorily to the requirements Company, a wholly-owned served as general appliance of normal employment. The other 26 left subsidiary, was formed in 1968 service supervisor-electric be-for personal reasons not related to their to prospect for possible oil and f rebecomingassistantdivision status in " Operation Outreach."

gas in the northern part of manager in Muskegon.

The Company is dedicated to continu Michigan's lower peninsula.

The Company has more than The Company's tion of the program.1t is anticipated tha 300,000 acres of land under Owners as many as 125 prev,ously disadvantaged i

lease fc.- this purpose. While no persons will be on the payroll as perma-commercial quantities of oil or The Company ended the year nent, productive employees by mid 1970.

with 101.692 shareholders of gas were found in 1969, geo-record. Common stock was physical evidence was encour-held in S7,443 names. Pre-aging enough to merit continued drilling, 9nd several additional ferred stock registrationstotaled 14,249. Consumers Power test wells are planned in 1970.

shareholders live in all 50 states, Changes in the District of Columbia and 35 Management foreign countries, but more than g

half are residents of Michigan.

Personnel individuals and joint accounts.

On January 7,1970, the Com-often husband and wife, repre-pany accepted with regret the sent 89 percent of all common resignation of Durward B.

shareholders.

Varner, Chancellor of Oakland University, as a member of its Shareholder Meetings Board of Directors. Chancellor On April 8,1969, the Annual Varner's resignation was Meeting of Shareholders was prompted by his acceptance of held in Jackson. Of all shares an appointment as Chancellor entitled to vote,84.94 per-of the University of Nebraska.

cent were represented.

The Company's management The 1970 Annual Meeting of Wil miss his wise counsel and Shareholders will be held at keen interest in the Company's 2:0 i p.m., Tuesday, April 14, affairs Jnd expresses deep ap-in the Company's Parnall Office preciation for his service on the Building in Jackson.

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I A. H. AYM0ND ROBERT P. BRIGGS JAMES H. CAMPBELL E. NEWTON CUTLER, JR.

LEE D. FERDEN JOHN F. GORDON FRANK HAMILTON C. S. HARDING MOTT DONALD J. PORTER LYLE C. R Company Directors I

A. H. AYMOND JOHN F. GORDON l

Chairman of the Boardof the Company Director, GeneralMotors Corporation Jackson, Michigan Birmingham, Michigan ROBERT P. BRIGGS FRANK HAMILTON Commissioner of financial Institutions, State of Michigan Retired First Vice President of Bankers Tmst Company Lansing, Michigan New York, New York JAMES H. CAMPBELL C. S. HARDING MOTT c

President of the Company President and Tmstee of the Charles Stewart Matt Foundation ~

j Jackson, Michigan Flint, Michigan l

E. NEWTON CUTLER, JR.

DONALD J. PORTER 1

Senior Vice President offirst NationalCity Bank President of Porter-iisdier Company j

New York, New York G ind Rapids, Michigan LEE D. FERDEN

.(LE C. ROLL Farmer (2 airman of the Board of Kellogg Company i

Chesaning, Michigan Battle Creek, Michigan l

DANIEL M. FITZ GERALD DR. E. GIFFORD UPJOHN Chairman of the Board and Chief Executive Officer of Director, The Upjohn Company The Wickes Corporation Kalamazoo, Michigan Saginaw, Michigan DURWARD B. VARNER*

i RICHARD M. GiLLETT Chancellor of 0akland#niversity i

President and Chief Executive Officer of Old Kent Bank and Tmst Company Rochester, Michigan i

Grand Rapids, Michigan

' Chancellor Vamer resigned imm the BoardJanuary 7,1970 24

. - - - ^ -

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Company Officers

}

A. H. AYMOND m.y, Chairman of the Board, Chief Executive Officer 7

JAMES H. CAMPBELL j ~-

President, Chief Operating Officer 4

HARRY R. WALL l

'j' Senior Vice President, Electric Operations JOHN B. SIMPSON Senior Vice President, Gas Operations

-s ROBERT D. ALLEN Senior Vice President, Generating Plant Engineering and Construction.

General Services and Personnel DANIEL M. FITZ-GERALD RICHARD M. GILLETT 81 RUM G. CAMPBELL Vice President, Marketing c

's W. ANSON HEDGECOCK kh' t

Vice President. Divisions and Customer Service

[

g RALPH C. BRETTING 4

Vice President, Personnel x >

FLOYD C. FISHER jy)

N, j Vice President, General Services 1,

T 3;

RUSSELL C. YOUNGDAHL 3

4 Vice President Electric Engineering, Construction Transmission and Distribution, j

l

,/

land and Right-of-Way and Purchasing and Stores WALTER R. BORIS Vice President, Finance JOHN W. KLUBERG

. GIFFORD UPJOHN DURWARD B. VARNER*

V ce President and Controller, Accounting and Rates W. JACK MOSLEY Vice President Bulk Power Resources PAUL A. PERRY, Secretary HERBERT J. PALMER, Treasurer HAROLD P. GRAVES, General Counsel Divisions and Managers

//feadquarters cities in patentheses)

Battle Creek Division (Batt/e Creek) GORDON W. HOWARD I

Bay City Division (BayCity) LOWELL L. SHEPARD Central Division (A/ma) RALPH HAHN Flint Division ////nt) J. LAURENCE GILLIE j

Grand Rapids Division (StandBapids) GORDON L. CARSON Jackson Division (Jackson) A. FRANK BREWER Kalamazoo Division /ta/amazoo) ARTHUR H. LEE i

Lansing Division (lansing) ROBERT H. LAWLOR, JR.

Macomb Division (East Betmit) GEORGE L. MAYHEW Muskegon Division (Muskegon) LIONEL L BOOTH (Deceased July 29,1969)

C. THOMAS BAYLIS (From August 1,1969)

Northwest Division (Traverse City) BOB D. HILTY O

Pontiac Division / Pontiac) CHARLES F. BROWN l

Saginaw Division (Saginaw) STANLEY M. JURRENS l

South Dakland Division /Boya/Osk) WILFRED L WHITFIELD West Wayne Division (livonia) JAMES P. THOMAS 25

1 ARTuun ANDERSEN & Co.

To the Board of Directors, Consumers Power Company:

We have examined the balance sheet of CONSUMERS POWER COMPANY (a Michigan corporation) as of December 31,1969, and the related statements of income, retained earnings and funds for the year then ended. Our examination was made in accordance with generally accepted auditing standards, and accordingly included such tests of the accounting records and such other auditing procedures as we considered necessary in the circumstances. We have previously examined and reponed on the financial statements for the preceding year.

In our opinion, the financial statements referred to above present fairly the financial position of Consumers Power Company as of December 31,1969, and the results of its operations and source of funds for gross property additions for the year then ended, in conformity with generally accepted accounting principles applied on a basis consistent with that of the preceding year.

Detroit, Michigan, February 6,1970.

Consumers Power Company Statement of Source of Funds For Gross Property Additions FOR THE YEAhs ENDED CECEMBER 31.1969 AND 1968 YEAR ENDED CECEMBER 31 SOURCE OF FUNDS FOR GROSS PROPERLY ADDITIONS:

1969 1968 Eamings retained in the business:

Net income after dividends on preferred stock

$ 63,426,000

$ 59,009.00 Less-Dividends declared on common stock (quanerly declaration formerly in December made in January, 1970) 32,446,000 43,137,000

$ 30,980,000

$ 15,872,000 Principal noncash charges: Depreciation and amonization-Per Statement of Income

$ 51,881,000

$ 48,825,000 Charged to other accounts 5,200,000 4.460.000 Deferred income taxes-net 10,962.000 9,901.000 Investment tax credit-net 3,416,000 3,396,000

$ 71,459.000

$ 66,582,000 Financing: Sale of first mortgage bands

$105,000,000

$110,000,000 Increase in notes payable 6,900,000 12,000,000 Retirement of bonds and preferred stock, in accordance with terms of issuance (7,788,000)

(6.688,000)

$104,112,000

$115.312,000 Other: Change in net current assets and current liabilities 4 (2,171,000)

$ 5.862.000 l

Other 723,000 4,643,000

$ (1,448,000) s 10,505,00 GROSS PROPERTY ADDITIONS

$205,103,000

$208,271,0

( ) Denotes deduction.

The accompanying notes are an integral part of this statement.

26

Statement of Income Consumers Power Company p

ren m vrAns excto occiusen si. ins no ins O

YEAR ENDED DECEMBER 31 1969 1968 OPERATING REVENUE:

Electric.......

$307.999,678

$286,245,624 Gas.......

240,535,782 217,681,852 Steam 1,239,386 1.191.514 Total operating revenue

$549,774,846

$505,118,990 OPERATING EXPENSES AND TAXES:

Operation-Purchased and interchanged power.............

$ 13.530,397

$ 6,793.357 Fuel consumed in electric generation..

59,091,019 56,128,706 Cast of gas sold 106,888,113 93,929.018 Other 100.874,343 89,834,470 Total operation

$280,383,872

$246,685,551 Maintenance..

26,121,267 24,685,560 Depreciation and amortization (Note 4).

51,880,650 48,824,702 General taxes 37,058,195 31,767,807 Federal income taxes (Note 5) 41,022,326 49,260,385 State income taxes 4,071,324 4,859.454 O

Provision for deferred income taxes-net 10.962,051 9.901.486 Charge equivalent to investment tax credit-net 3.416,145 3.395.805 Total operating expenses and taxes....

$454,915,830

$419,380.750 Net operating income............

$ 94,859,016

$ 85,738,240 OTHER INCOME:

Dividends from Michigan Gas Storage Company 1,350,000 1,029,375 Other........

1,540,087 1,318.981 Gross income.

$ 97,749.103

$ 88,086,596 INCOME DEDUCTIONS:

Interest on long-term debt..........

$ 35,956,150

$ 29,043,620 Interest on notes payable....

2,685,912 998,123 Interest charged to construction (credit)..

(8,421,485)

(4,891.483)

Oth e r.............................

568,183 379,677

$ 30,788,760

$ 25,529,937 Total income deductions Net income.......................

$ 66,960,343

$ 62,556,659 3.534,500 3,548.060 DIVIDENDS ON PREFERRED STOCK..

Net income after dividends on preferred stock

$ 63.425,843

$ 59.008.599 EARNINGS PER SHARE OF COMMON STOCK

~)

. BASED ON AVERAGE SHARES OUTSTANDING (V

(22,768,900 shares in 1969 and 22,670,777 shares in 1968)..

$2.79

$2.60 The accompanying notes are an integral part of this statement.

27

Balance Sheet AT DECEMBER 31.1969 AND 1968 DECEMBER 31

/Lssets 1969 1968 UTill1Y PLANT: At original cost-Electric....

$1,382.978,143

$1,253,093.250 Gas........

671,063,973 620,067,956 Steam......

4,793.492 4.287,566 52,164,195 46,633.978 Common to all departments

$2.110,999,803

$1,924,082,750 Less-Provision for accrued depreciation.

468,021,841 427.774,321

$1.642,977,962

$1,496,308,429 OTHER PHYSICAL At cost or less-less provision for accrued depreciation PROPERTY:

of $100,586 in 1969 and $30,266 in 1968 2.774,295 2,920,83 INVESTMENTS: Common stock of wholly owned subsidiaries, at cost-Michigan Gas Storage Company

$ 16,205,186

$ 16.205.186 Northem Michigan Exploration Company 2,000,000 1,500,000 Other, at cost or less....

754,711 876,795

$ 18.959,897

$ 18.581.981

~

CURRENT Cash........

$ 10,260.297

$ 10,338,144 ASSETS:

Accounts receivable, less reserves of

$363,453 in 1969 and $365,600 in 1968 47,327,592 42,524,383 Materials and supplies, at average cost....

43,185,091 34,580,535 Gas in underground storage, at average cost....

20,219,372 15,853.414 Other 19,190,426 15,412.063

$ 140,182,778

$ 118,708,539 DEFERRED Portion of cost of Big Rock Point Nuclear Plant, DEBITS:

in process of amortization 2.464,044 3.776,044 Other 1,165,803 415,663 3,629,847 4,191,707

$1,808,524,779 The accompanying notes are an integral part of this statement.

28

Consumers Power Company nN,]

OECEMBER 31 Liabilities 1969 1968 CAPITAllZATION: Common stockholders

• equity-Common stock, $10 par value, authorized 25.000,000 shares, outstanding 22,768,900 shares

.

• 227,689,000

$ 227,689,000 Capitalin excess of par value (Note 6) 187,756,338 187,654,365 Retained eamings, of which $5.935,035 (equal to $7.50 per share of preferred stock) is not available for payment of cash dividends on common stock.

156,482.642 125.503.192 8 571,927,980

$ 540.846.557 Less-Capital stock expense 3.201,380 3.203,150 Total common stockholders' equity.

.. $ 568,726.600

$ 537,643.407 Preferred stock, cumulative, $100 par value, p

authorized 1,500,000 shares (Note 6).

(j 79,133,800 79,533.800

$ 647,860,400

$ 617.177.207 Long term debt (Note 7) 810,585,400 714.627,900 Total capitalization

. $1.458,445,800 31,331,805,107 NOTES PAYABLE: Notes payable due within one year

$ 42,900,000

$ 36.000,000 CURRENT LIABILITIES Current sinking fund requirement on long-term debt 9,038,000 7,388.000 (excluding notes payable Accounts payable.

64,462.226 52.651,947 due within one year): Accrued taxes.

58,897,524 45,460.701 Accrued interest 12,574,704 11,290.952 Other..

11,814,942 20.692,433

$ 156,787.396

$ 137,484.033 DEFERRED Investment tax credit, being amortized over life of the CREDITS:

related property.....

$ 21,721,067

$ 18.304.922 Other.

2,494,756 4.297.183

$ 24,215,823

$ 22.602.105 RESERVES: Deferred income taxes.

$ 105,049,692

$ 94.087,641 Other................

1,800,620 1,937,352

$ 106,850,312 s 96,024.993 OTHER: Contributions in aid of construction

$ 19,325,448 s 16,795,249

$1,808,524,779 61.640.711.487 J

The accompanying notes are an integral part of this statement.

29

Etatement of Retained Earnings Consumers Power Compsny FOR THE YEARS ENDEO DECEM8ER 31.1H9 AND 1988 YEAR ENCEO DECEMBER 31 1969 1968 RETAINED EARNINGS-Beginning of year...

$125,503,192

$109.631,936 ADD-Net income after dividends on preferred stock.

63,425.843 59.008.599

$188,929,035

$168,640,535 DEDUCT-Cash dividends on common stock declared in the amount of $1.425 per share in 1969 and $1.90 per share in 1968 (quarterly declaration fornarly in December made in January,1970); paid $1.90 per share in 1969 and 1E68 32.446.393 43.137.343 RETAINED EARNINGS-End of year (see balance sheet).

$156.482.642

$125.503.192 The acccmpanying notes are an integral part of this statement.

Notes to the Financial Statements Consumers Power Compan 1 Because of increased costs of doing business, rate increases were grarted by the Michigan Public Service Commission (MP by order of September 29,1969 (which order has been appealed tc the Ingham County Circuit Court by the Company an also by the Attomey General of the State of Michigan) to increase annual gas and electric revenues by $21,308.000 and

$16.514,000, respectively, based on 1968 sales volumes. Following hearings thereon. revised gas rates designed to produce the authorized additional gas revenues were approved by an order of the MPSC on October 21,1969 (which order has been appealed to the Ingham County Circuit Court by the Attamey General) and became effective on October 22,1969. Revised electric rates designed to produce the authorized additional electric revenues became effective on October 22,1969, by court order, pending hearings thereon and determination thereof by the MPSC. Such hearings were held on February 3 and 4.1970, but no order has been issued to date. The revised electric rates are subject to refund to the extent the MPSC may modify or alter the rates or to the extent they exceed the prior rates ($2,600.000 through December 31.1969) if the court order is reversed by an appellate court.

The ingham County Circuit Court has also issued a temporary injunction staying a portion of the MPSC's order of Septembu 29 1969 which regnirad the Company to reduce its revised gas and electric rates within 30 days of a reduction in or expiration of the 10% Federal income tax surcharge by the amount of the tax reduction. As a result of the reduction in the surcharge, on and

=

after January 30,1970 the revised gas and electric rates are subject to refund, pending hearing on the Company's appeal of the MPSC's order, for the amount that the Coropany's rates would have been reduced under the portion of the order which was stayed.

2 The Company has a trusteed noncontributary pension plan under which full-time regular employees within specified age limits and periods of service are qualified to participate. The contributions to the plan of $7,386,000 in 1969 and $6,749,000 in 1968 were charged to various operating, construction and other accounts. The contributions include current service costs, interest on unfunded prior service costs end amortization of prior service costs. The unfunded prior service cost at July 1, 1969 amour.ted to $3,772,000.

3 Capital expenditures for property additions during 1970 are presently estimated to total $232.000.000 and substantial com-mitments for the purchase of construction materials have been made in connection therewith.

4 The Company follows the practice of providing depreciation on the basis of straight-line rates approved by the Michigan Publ' Service Commission. Composite depreciation rates were approximately 2.85% for electric property and 3.20% for gas prope for 1969 and 1968.

5 Federat income tax expense for1969 has been reduced by $2.500,000 ($.11 per share) representing an adjustment of income taxes provided in prior periods.

30

DECEM8tR 31 REDEMPTION etOfdRs 1969 1968

/.-N 6 Preferred stock is represented by:

d

$4.50-547,788 shares outstanding..........

$110.00

$54,778,800

$54,778.800

$4.52-147,550 shares outstanding, less 4,000 shares purchased in 1969 for retirement..........

$104.725 14,355,000 14,755,000

$4.16-100,000 shares outstanding........

$103.25 10.000.000 10,000,000 Total preferred stock..............

$79,133,800

$79,533.800 The Company is required to endeavor to purchase and retire annually 4,000 shares of the $4.52 preferred stock at a price per share not to exceed $102.725 plus accrued dividends. Such purchases of preferred stock in 1969 resulted in a net gain of $101,973 which was credited to capital in excess of par value.

DECEM8ER 31 7 Long-term debt is represented by:

1969 1968 FirstMortgage Bonds-2%% Series due 1975......................

• 92.437,000

$ 98,450,000 2%% Series due 1977......................

24,775,000 24,775,000 3%% Series due 1981......................

39,000,000 39,700,000 3% Series due 1984.......................

24,075,000 24.750,000 4% Series due 1986..

40,000,000 40,000,000 3X% Series due 1987......................

25,000,000 25,000,000 4%% Series due 1987......................

246,000 246,000 4%% Series due 1988..

40,000,000 40,000,000 4%% Series due 1989......................

35,000,000 35,000,000 3%% Series due 1990.......

30,000,000 30,000,000 4%% Series due 1990......................

35,000,000 35,000,000 4%% Series dus 1991......................

40,000,000 40,000,000 5%% Series due 1996............

59,560,000 59,560,000 0

6% Series due 1997................

79,400,000 79,400,000 6%% Series due 1998......................

55,000,000 55.000,000 6%% Series due 1998......

55,000,000 55,000,000 7%% Series due 1999......................

50.000,000 8%% Series due 1999...........

55,000,000 Total First Mortgage Bonds...................

$779.493,000

$681.881,000 Sinking Fund Debentures,4%%, due 1994................

40.000,000 40,000,000 5% Mortage Bonds due 1988, assumed upon acquisition of Ragers City Power Company 130.400 134,900

$819,623,400

$722.015,900 Deduct-Current sinking fund requirement included in current liabilities:

First Mortgage Bonds.................

$ 8,438,000

$ 7,388,000 Sinking Fund Debentures 600,000

$ 9.038,000

$ 7.388.000 5

Total long-term debt......................

$810,585,400

$714,627.900 4

31

Financial Cummary 1C00-1C00 1969 1968 7

STATEMENT Operating Revenue OF Electric.................

$ 307.999,678 $ 286,245.624 8 270.086,001 INCOME Gas..................

240,535,782 217,681,852 205.882.42(

DATA Steam Heating..............

1,239,386 1,191.514 1.213.02(

Operating Revenue Deductions. Except kres....

358,385,789 320.195.813 300,603.51l Taxes FederalIncome h1 41,022,326 49,260,385 45,486,466 State Income kx.............

4,071,324 4.859,454 Defened Income Tax............

10,962,051 9.901.486 7,692.516 kvestment hx Credit (Net).........

3,416.145 3,395.805 4,055,825 Other.

37,058,195 31.767,807 29,468.285 Net Operating Income Electric.

62.598.806 57,034,666 58.851.897 Gas 32.651,237 28,870.985 31.093,931 (391.027)

(167.411)

(70,991 Steam Heating..

Other income 2.890,087 2,348,356 1,428,371 Income Deductions...

39,210,245 30.421,420 25,335,084 Interest Charged to Construction-Credit 8,421,485 4.891.483 2,555,367 Net income.....

66,960,343 62,556,659 68,523.498 Cash Dividends Declared On PreferredStock...

3,534,500 3.548.060 3.567.016 On Common Stock.............

32.446,393( )

43,137,343 4

843 Eamings Retained.

30,979.450 15,871.256 2

631 Common Stock. Unadjusted. See Footnote (1)

Average Shares Outstanding.

22,768.900 22.670.777 22,628,901 Eamings per Share.............

2.79 $

2.60 $

2.87 Cash Dividends Paid per Share 1.90 $

1.90 $

1.91 Common Stock, Adjusted. See Footnote (1)

Average Shares Outstanding 22,768,900 22,670,777 22,628,901 Eamings per Share.

2.79 $

2.60 $

2.81 Cash Dividends Paid per Share...

1.90 $

1.90 $

1.81 Interest Charged to Construction per Share....

.37 $

.22 $

.11 BALANCE Utility Plant.

$ 2,110,999.803 $1.924.082.750 $1,742,150,61)

S Accrued Depreciation......

468,021,841 421,774,321 390 061,571 Plant investment per Employee....

181,342 171.487 130,751 Capitalization, See Footnote (2)

Common Stock and Rctained Eamings......

$ 568,726.600 $ 537.643,407 $ 516,87,,19E Preferred Stock..............

79,133,800 79,533,800 79,C62,58; Long-Term Debt.....

810.585,400 714.627.900 612.015,90C Total Capitalization...........

$1.458,445,800

$1,331,805.107 $1,208.840,276 Capitalization Ratios-%, See Footnote (2)

Common Stock and Retained Eamings......

39.0 40.4 42.E Preferred Stock..............

5.4 6.0 6.C Long-Term Debt..............

55.6 53.6 50.f

(!) Common Stock. Unadjusted f6gures do not ref!ect any ad ustment to previously reported (3) Fourth Quarterly dmdend formerty...ared i

figures for the 2 for 1 stock scht in Aord 1962 or for the 10% C smmon Stock Dmdend issued in December declared in January,1970.

Aprd 1967. The Common Stock. Adjusted. f' gyres ref!ect these adjustments.

(2) Total Capitahta!ron and Common Stock and Reta.ned Earmngs data shown above for 1964 and enor years have been resta'ed to ref'ect the deduction of expense perta neng to stock issues previously reported as a ce+er'ed debit.

32

I j966 1965 1964 1963 1962 1961 1960 1959 3 257.833,579 $ 239.991.443 $ 221,738.649 $ 209.202,898 $ 198,857,361 $ 186,399.427 $ 179,568,429 $ 168,485.422 188,927,810 172.321.289 153,779,511 142,115.564 131,395,598 114,655,299 100,769,449 87.936.995 1.138.878 937,113 882.058 944.005 976.696 1,001.675 1,058,055 1,103,008 280.364.645 256.581.178 232.954.932 220.071.186 206.499.817 189.100.637 179.967.924 158.097255 48.883.101 47.406.213 43 299.441 39.016.596 37.953.679 33.732.041 28.647.373 30.752.042 6.813.332 6.1'3.110 6.920.315 7.105.571 6.999.982 7.248.992 7.059.399 6.599259 2.158.151 2.b85234 1.939.263 2,174.310 1.966.029 26.038.103 23.055.001 21.199.959 19,868.033 17.343,455 16.922 249 15.433.274 12.944.658 55,851.252 52,346,746 47,767.645 44.715,036 41,906.814 39.573.111 38,147,033 35.423.243 27.807,461 25,168.901 22.387.564 19,366.352 18,635,125 15,558.320 12.269.197 13,717,283 (15,778)

(83,538)

(68,901)

(54,617)

(75,246)

(78,949)

(128,267)

(8.315) 2,040,272 2.612.514 1,753.543 1,894,011 1,488.877 1,590,088 1,704.170 1,747,760 20.837.021 18.797.939 18.192.629 18.569.918 18.681.151 18.113.572 16.118,539 14.901.737 2,332,530 635,545 365,927 332,660 1.990.245 1,879.517 2,376,994 2.448,132 67.178,716 61,882.229 54,013,149 47.683,524 45,264.664 40,408,515 38,250.588 38.426.366 3.584.565 3.614,036 3.629.259 3.655.648 3.665.595 3.683.453 3.698,259 3.717.765

.078.528 37.540283 33.609.204 30260.152 27.542.109 25.421.656 24.767.968 22.618.626 515,623 20,727,910 16,774.686 13,767.724 14,056,960 11,303,406 9.784.361 12.089.975 20,567.560 20.555.589 20.330.016 20,094,050 19,608.383 9,568.115 9,525.665 8,885.147 i

3.09 $

2.83 $

2.48 $

2.19 $

2.12 $

3.84 $

3.63 $

3.91 i

1.90 $

1.775 6 1.60 $

1.475 $

1.40 $

2.60 $

2.60 $

2.45 22.624.316 22,611,148 22,363,018 22.103.455 21,569,221 21,049.853 20,956,463 19.547,323

)

2.81 $

2.58 4 2.25 $

1.99 $

1.93 $

1.74 $

1.65 $

1.78 i

1.73 $

1.61 $

1.45 $

1.34 $

1.27 $

1.18 $

1.18 $

1.11 i

.10 $

.03 $

.02 6

.02 $

.09 $

.09 $

.11 $

.13 11,619,668,027 $1,482,250.832 $1,384,203,322 $1,329.744.266 $1,284.320,741 $1.206.518,804 $1.123.245.187 $1,032,574,699 5

364.653,544 330.308.291 302.318.407 273,316,827 245.831,001 219,227,665 193,273,276 173.118,255 154.283 148,477 141,940 136,608 131,833 131,809 111.855 102.897

$ 494.483.584 $ 468.976,284 $ 445,022,760 $ 421,589.507 $ 394.398.888 $ 368,248,909 $ 347,904,226 $ 314,297,038 80.363,340 80.764.100 81.164,860 81,565,619 81,966.379 82.367.138 82,767,898 83,168,658 538,169,000 478.657.000 486,591,691 457,187.082 493,062,773 489.337.064 461.924,254 415,935,000

$1,113,015.924 $1,028.397,384 $1,012,779,311 $ 960,342.208 $ 969.428.040 $ 939.953,111 $ 892,596,378 $ 813,400,696 44.4 45.6 43.9 43.9 40.7 39.2 39.0 38.7 7.2 7.9 8.0 8.5 8.5 8.8 9.3 10.2

{

48.4 46.5 48.1 47.6 50.8 52.0 51.7 51.1

' m r,om. vor v..r. ono,io i ssa n.v. t:..n r.st.:.a.n.,.

. C St of p rCn. Sed gas. d r er st Corn. e.t

'Lt23"l1,lad f'."lka':\\%:1.'i2'""""-

o 33

PE'1 CENT INCREASE Electria and Cas Opercting C:mp rison 1C00-1C00

" E##o*'M' 1969 1968 1959,

1968 electric revenue Resid:ntial.

$119,298,937 8.5 68.1

$1 41 Commercial..............

76,246,495 9.0 101.2

.511 Industrial...............

98,132.472 7.8 87.2 1 71 Interdepartmental and Other.....

5,320,222 9.7 95.0 4.849.7G Total Sales to Ultimate Consumers

$298,998,126 8.4 82.3

$275.808.94i Power Pool..............

(100.0) 2.504.411 Other Resale.....

5.567,956 13.3 120.4 4.912.92)

Total Electric Sales Revenue...

$304,566,082 7.5 82.9

$283,226.31 Miscellaneous Electric Revenue......

3,433,596 13.7 76.5 3.019.21 Total Electric Revenue........ $_307,999,678 7.6 82.8

$286,245.621 electric sales Residential.

• 5.546,263 9.0 79.2 5.090.51 (1,000 kilowatt-hours)

Commercial 3.673,709 8.4 129.7 3.388,70 Industrial...............

8,578,389 5.9 113.8 6,104.01 Interdepartmental and Other........

191,951 2.8 64.4 186,7C Total Sales to Ultimate Consumers...

17.990,312 7.3 103.9 16.770.01 Power Pool......

(100.0) 411.61 Other Resale..............

489,051 14.0 134.1 428.9?

Total Electric Sales.........

18,479,363 4.9 104.6 17.610.61l peakload Kilowatts 3,377.275 6.2 88.2 3.179,71 generating capacity Kilowatts.

3,411.086 1.2 50.2 3.371.68 heat rate 8tu of Fuel per Net Kilowatthour Generated 9,941 1.4

.3 9.80 1,057.735 2.5 23.2 1,031.91 electric customers End of Period...

electric residential Annual Kilowatthours Used....

5,954 6.2 45.4 5.61 customer Revenue per Kilowatthour Used.

2.15C

(.5)

(6.1) 2.1@

averages Annual Revenue.

$128.06 5.7 36.4 21.1 gas revenue Residential Using Gas for Home Heating

$133,776,482 8.6 192.1

$123.150,73 O th e r................

6,097,784 (3.7)

(49.3) 6.329.2[

Industrial and Commercial.

93,716,797 12.8 228.7 83.103.73 3,079,358 845.9 1,212.4 325,55 Interdepartmental (1).

796,401 (40.5) 1.337-47 Resale Total Gas Sales Revenue.

$237,466,822 10.8 174.3

$214.246,75 Miscellaneous Gas Revenue 3,068,960 (10.7) 124.6 3.435.10 Total Gas Revenue......... $240,535.782 10.5 173.5

$217.681.8E gas statistics Gas Sales (1,000 cubic feet)

Residential 120,256.

Using Gas fo; Home Heating...

129,060,276 7.3 169.8 Other....

3,997.083 (5.2)

(54.1) 4.215.23 Industrial and Commercial 139,497.140 10.8 234.6 125,896.41 Interdepartmental (1)..

7,214,920 1,395.3 2.269.8 482.51 Resale.

1.992.394 (45.0) 3.620.01 total Gas Sales.........

281.761.813 10.7 186.0 254.470.53 Net to Storage....

10,937,194 76.3 6,204.57 l

Unbilled. Lost and Company Use......

9.548,264 (24.5) 1,071.2 12.648.53 Total Gas Purchased and Produced..

302.247.271 10.6 204.2 273.323,6E maximum 24-hour 1,735,000 2.6 188.1 1.690,5f gas sendout (1,000 Cubic Feet) gas customers End of Period..

830.011 4.0 62.9 8.3:

residential Numbrs End of Period..........

675.851 5.3 155.0 1.6E customers Average Annual Mcf Used.........

196 1.0 1!

using gas for Average Revenue per Mcf Used.......

103.65c 1.2 8.2 102.4' home heating Average Annual Revenue.......

$203.27 2.5 8.2

$198.:

34

(') '"c'"d '""*c

'npany sa'es f gas t the electric departrnent for use in generating electncity in years 1969.1968.1965.1962.1961 and 19

1967, 1966 1965 1964 1963 1962 1961 1960 1959

,138.339 $ 97.033,110 $ 92,266,607 8 89,427,891 $ 85.334.132 8 82.884.470 $ 79.727,171 8 76,207.206 4 70.957,616

.073.608 60,286.010 55.636,401 52,431,943 48,849,529 46,237,915 43.291,862 40.338,087 37.904.248

.387.765 84.042.956 77.918.003 70,290,252 65,182.252 60.682,708 54.718.983 55,054.612 52.423,154 4.497.443 4,143.604 3,883,767 3,666.062 3,453.244 3.343.702 3.145,774 2.930.291 2,728.713

$256.097.155 $245.505.680 $229,704.778 $215.816.148 $202.819,157 $193.148,795 $180,883,790 $174,530,196 $164.013.731 5.515.600 4.081,741 2.962.550 4.662.499 4.412,239 4.116,623 3.845.597 4.187,933 3,740.699 3,298.695 2.956.622 2.526.044

$266.275.254 $253,999,660 $236,783.951 $219,661.745 $207.007,090 $196.889,494 $184.182,485 $177,486.818 $166,539,775 3.810.747 3,833.919 3.207.492 2,076.904 2.195,808 1,967.867 2,216,942 2.081.611 1,945.647

$270,086.001 $257.833.579 $239.991.443 $221.738,649 $209.202,898 $198.857.361 $186.399,427 $179,568,429 $168.485.422 4.677,692 4.394.426 4.051.505 3.839,862 3,647,764 3,530,776 3,376,511 3.205.406 3,094.393 3.053,439 2,826.722 2,539,873 2.340.920 2.143.567 2,000,412 1,838.741 1.690,660 1,599.315 7.496.857 7.353.814 6.643.212 5.797,370 5.299,805 4.846,180 4,180,726 4.279,984 4,012,905 181,586 171.802 159.324 149.239 141,795 141,747 136.533 127.815 116,775 15.409,564 14.746 764 13.393.914 - 12.127.391 11.232,931 10.519,115 9,532,511 9.303.865 8.823,388 932.307 723.239 526,283 406.721 404.006 375.790 334.983 370.657 328.777 278,252 249.637 208.872 16,748.592 15.874.009 14.295.987 12.462.374 11.603 588 10,847.892 9.810,763 9,553,502 9,032.260 2.941,030 2.860.410 2,570,040 2,374,910 2,217.405 2,038,155 1,948.350 1.876,390 1.794.650 3,307.684 2,922,684 2.852,684 2.790.064 2,791.564 2.792.664 2.534,992 2.270.962 2.270.962 9,838 9.805 9,555 9,463 9.433 9.631 9,675 9.857 9.912 1.002.706 379.095 954.477 931,791 911.671 898.862 885.832 873,834 858.457 5.298.

5.096 4.824 4.677 4.539 4.443 4.315 4.162 4,096 r. 2.18 c 2.21c 2.28c 2.33c 2.34c 2.35c 2.360 2.380 2.29c js115.69

$112.53

$109.87

$108.92

$105.96

$104.31

$101.89

$98.94

$93.92

$117,697,394 $108,703.823 $ 99.775,009 $ 89,412.353 $ 81.997.119 $ 75,065,216 8 63,601,515 $ 52,200.274 $ 45,805.934 6,854.687 7.157,020 7.680.330 8,209,016 9.450.577 10,171,957 10.387.623 11.054.279 12.020.807 76.436,579 69,079,432 61.603.815 53.157.491 47,851.767 43,225 914 36,595,988 32,962,377 28,509.026 272.109 258,660 394.490 252.837 255.241 547.350 2.314.246 1,379,246 234.627 861.357 443.072 680.446 533.070 462.579 1.157.305 1,632.008

$202.122.126 $185.643,007 $170,134.090 $151.564,767 $140.017.283 $130.167,742 $112.899,372 $ 99,228,184 6 86.570.394 3,700.300 3.284,803 2,187.199 2,214.744 2.098,281 1.227,856 1.755.927 1.541,265 1,366.601

$205,882.426 $188.927,810 $172,321.289 $153,779,511 $142.115.564 $131,395,598 $114,655,299 $100.769.449 $ 87.936,995 b

115.315,155 106.199,355 97.565,207 86.516.602 79,332,269 72.941.562 S4.303.774 53.760.032 47,827.215 4.592.474 4,733.021 5,094.559 5.428.669 6.405,305 6.845,467 7.241,954 8.187.652 8.713,106 115.096.882 104.281,134 92,737,550 78.035.901 69.076,501 62.013.406 52,797,012 48,853,317 41,690,243 363.134 345.884 794.297 329,956 320,268 1.290,972 6.611.019 3,709,408 304.449 2.222,554 997.531 1,617,358 1,239,896 1.034.768 2.519,009 3,785.446 237,590,199 216,556.925 197,808.971 171.551,024 156,169,111 145.610,436 130.953.759 118.295,855 98,535,013 8,525,693 (3,106,249) 327.920 9,748,391 5.322.355 7.305,514 5.872,391 10,283.514 11,325.387 9.875.156 7.175.045 3,891.118 6.354.454 3.857,019 2,338.405 6.855.227 815.262 257,441,279 223,325.832 205.311.936 185.190.533 167.845.920 156,772,969 139,164.555 135.434.596 99,350,275 1,488.000 1,477.302 1,275,076 1,077.722 1.140,880 982,434 843.543 821.362 602.123

^ 164,903 734,947 697.011 659.151 621.112 590,633 562,897 539.474 509.462

.04.124 569.353 526.788 483,963 438,298 400,668 361,335 321,909 265.073 198 194 194 188 191 193 189 184 196 102.07c 102.36c 102.260 103.35c 103.36c 102.910 98.91c 97.100 95.77c

$201.69

$198.68

$198.02

$194.22

$196.95

$198.73

$187.01

$173.45

$187.78

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35

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l Annual Meeting

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7-The annual meeting of share-

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Company will take place Tues-

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day. Apnl 14. ' 970. at 2 p m in A

the Companfs Parnall Office i

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Road. Jackson. Michigan A s e notice of meeting. proxy state-

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ment and proxy will be mailed to shareholders on or about f

March 5.1970.

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proxies will be appreciated by

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