ML20009B618
| ML20009B618 | |
| Person / Time | |
|---|---|
| Site: | Grand Gulf  |
| Issue date: | 07/09/1981 |
| From: | MISSISSIPPI POWER & LIGHT CO. |
| To: | |
| Shared Package | |
| ML20009B613 | List: |
| References | |
| NUDOCS 8107160444 | |
| Download: ML20009B618 (16) | |
Text
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ENERGY SAVERS s
ZIPRUD MISSISSIPPI POWER & LIGHT COMPANY 1976 ANNUAL REPORT l
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Officers and executive department heads are shown in lhese three informalphotos. A t top, from left Donald Colmer, Vice l>esident, Public Affairs and Environmental Matters, Frank S. York, Controller and Chief Financial Officer, Donald C. Lutken President and Chief Executive Officer, George Ledlotc, Director, Internal Auditing, W R Casper, l>casurer. Hottom left, from left Donald E Meiners, Manager, Customer Services, Thomas A. Dallas, Manager, Engi-neering, System Operations and Construction, Joe 11 Hox, Senior Vice l>cstuent, Production, Engineering arul Con-struction, W T Woods, Jr., Manager, General l>operty and Services, John D Hollarut, Vice l>csident, Area Affairs.
Hottom right, from left, seated: James R. Martin, Assistant Treasurer; Norris L Stampley. Vice l>esident, Production; Alex McKeigney, Vice l>esident, Informational Services standing, from left Marion Totensend, Chief Engineer; C.
b Lamar Stephenson, D. rector, Personnel ideceased1, and Allan H. Mapp, Assistant Secretary.
General Offices About Our Cover Electric Building, Jackson, Mississippi 39205 Our i over for this report features emolems of the " big Registrar (for preferred stock) three' energy 6 aver campaigns developed and promoted by Deposit Guaranty National ihnk, Jackson, Mississippi M d over the past several years. At top is the newest mem-Transfer Agent her of the trio. the ZipTp program launched in early 19i 7. i First National Bank of Jackson, Jackson, Mississippi it is a united retrofit campaign designed to fit the individual This report is prepared for the information of security homeowner's needs. Bottom left shows the familiar emblem holders, employees and other interested persons. It is not developed by MP&l. in support of the heat pump for heating transmitted in cor.nection with the sale of any security or and cooling, and at bottom right is the E3 tenergy efficient offer to sell or offer to buy any security. electrici symbol introduced in 1976 to designate homes meet-
{
ing the strict energy efficient standards m home construction. i MP&l, has pioneered in developing concentrated programs as (
indicated by these emblems to hone fit customers and the pubhc during the worldwide energy crNs.
f i
. To Our Stockholders and Members of Our Organization i
i Operation results for your Company during 1976 were to refund with interest. On September 8,1976, the FPC ,
satisfactory, even in the face of the multiple and growing approved a wholesale rate increase to municipalities and '
problems enveloping the electric utility industry nationwide. electric power associations which had been placed in effect ne above statement may sound somewhat paradoxical, in December,1974. This rate increase amounted to $800,000 since most authorities agree the energy crisis will get worse for municipalities, and $3,408,000 for electric power associa-before it gets better,and that the world is approaching the end tions, based on the projected test year ended June 30,1975.
of the petro:eum age. Nevertheless, during the Nation's bl.
centennial, Ml'&L in its 53rd year, met every demand for Power Demand Up 5
service to customers in the 45<ounty ama of western Missis.
sippi in which it operates. Also, the financial picture was Energy requirements by MP&L customers increased during
- improved somewhat due to an expanded cost reduction 1976, reflecting some economic recovery from the recession.
1 program and partial rate relief granted by regulatory agencies, ary trend, and also a growth in the Company's operating area.
De better year allows no room for complacency,however. Total energy sales reached 9.98-billion kilowatt-hours, up 167e ,
i De three dominant problems affecting current operations, over the previous year. Sales to ultimate customers amounted i cited here last year, continue unabated. They are: inflation to 6.29-billion kilowatt-hours, an increase of 67o over the year j high cost of new capital, and dwindling supply and uncertainty before. Industrial use was up 117e; commercial use up 57 and
! of boiler fuel. A fourth deterrent underlying all of these, is residential use up 2% Peak demand on Companylines,which the continuing failure of the government to Aopt a definite occurred at 4 p.m. on July 26, was 1,733,000 kilowatts, an
- and positive energy policy. A cound energy policy which wili increase of 91,000 kilowatts, or 67o over 1975. During the i produce more r;nergy to meet the needs of people and provide year, there were 71 new and expanded industries announced
, for future economic growth is basic to solving the energy for the Company service area.
crisis. The future of our area, state and nation will be bleak indeed if we rely upon less production and higher costs to solve the problem. Also, conservation, as essential and im. Revenues & Expenses Up 4
portant as it is, does not provide for more jobs, mom oppor.
l tunity and growth. For the imruediate future, the nation must Higher fuel cost adjustment (resulting from higher cost of
- develop its uranium and coal resources to provide the fuel energy to the Company for boiler fuel), greater use of electric-d required to generate needed electricity, ity by customers, and the slight rate increase resulted in a new record high reached in operating revenues for the year-Some Rate Relief $308,776,000 as compared with $240,057,000 for 1975.
However, these increased revenues were offset substantially l
De acs,411shments of MP&L for 1976 would have been by the large increase in expenses, $263,480,000 for 1976.
impossible without the partial rate relief granted (nearly 667o up $60,978,000 or 307o over the year before. The large',t of the total requested) by the Mississippi Public Service Portion of expenses was for fuel and purchased power, Commission order of May 6,1976. It was the second major $177,292,000 for the year as compared with $128,720,000 retail rate increase in the history of the Company, and was in 1975, up 38% De Company's fuel cost adjustment has i put into effect under bond on December 11,1975. The in. n t fully ree vered these added costs. MP&L's generating i crease requested was approximately 157o for all retail cus. plants in 1976 burned 9,794,945 barrels of fuel oil,an increase r the year.
tomers, and would have resulted in some $29,905,000 in additional revenue for 1976. The May dechion of the MPSC reduced the annual increase requested by some $10-million. Customers Increase
. Rather than incurring the expense of a Irngthy legal appeal on the ruling, the Company accepte1 the decision, tightened At year's end, the Company had a total of 285,338 cus.
Its belt even further and made plans to live with the partial tomers, up 4,605 over 1975. Here is a breakdown of cus.
relief as long as possible. New retail rates in keeping with tcmers: residential, 245,384; commercial, 34,718; industrial, the decision were filed with the MPSC and approved on 3,247; government and municipal,1,920; cooperatives and June 3,1976. Customers were refunded some $4-million municipal,67;other public utilities,2.
collected for the period December 1975,through June,1976, Residential customers continue to consume the largest as a result of the reduced amount granted by the MPSC. volume of MP&L electricity as a class. Such customers used a On July 30, 1976, MP&L filed with the Federal Power total of 2.54illion kilowatt hours during the past year. Res.
Commission new rate schedules which were revised on October idential customers used an average of 10,237 kilowatt-hours
- 26, 1976, applicable to wholesale services to electric power during 1976. This was only 39 kilowatt-hours more than the
, association and municipally operated utilities. %Is increase average residential customer used in 1975, ard reflects con.
j should produce additional revenues of $475,000 from munici. servation efforts and the mild summer.
4 palities, and $2,091,000 from electric power associations, f giving a projected total increase in wholesale revenue of Construction
$2,566,000, based upon the test year ended December 31, 1976. Pursuant to an order of the FPC, the new rates, as Total construction expenditores for the year were revised, became effective on December 1,1976, subject $40,084,000,a decrease of $8,180,000 when compared with
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P 1975. ine conversion of plants originally built to burn natural A 230/115,000 volt substation to terminate this line was built gas to ourn fuel oil was completed in 1976, with exception at Rex Bn .n SES. Other projects for 230,000 volt facilities of sot.1e minor clean-up. Expenditures for such conversion to serve twd growth in the Jackson area were started in 1976, cork during the year were $12,186,000. and involved a 230,000 volt circuit from the Ray Braswell The largest construction project in h!ississippi's history, EllV substation to the present South Jackson 115,000 volt the 31.9-billion Grand Gulf Nuclear Station near Port Gibson, substation. A 230/115,000 volt substation will terminate this rerrained on schedele during the year, with employment line at the South Jackson substation, retthing some 3,200. Work on the first unit was approximate- Other major construction items begun in 1976 are: i ly 387c complete at year's end. The unit, with 1,250,000 A new 115,000 volt substation that was completed on !
kilowatt capability, is to be completed in late 1980, with Canton Road in Jackson; new 115,000 volt substations at )
the second unit to be completed in 1984. The facility is owned Southeast Greenville, Southeast Vicksburg, ml Edwards; and being financed by 51iddle South Energy, Inc., a sub- installation of additional transformer capacity w ngswood, sidiary of 5!iddle South Utilities, and will be maintained and Byram, and Luckney substations; installation and/or replace-operated by 51P&L, under contract with 51SE. ment of oil curcuit breakers at Liberty, Franklin EllV, Rex Brown Switchyard,and East Jackson.
In addition, the installation of the Supervisory Control The Revenue Dollar and Data Access System for control and monitoring of the transmission system and the Jackson area distribution system Here is a percentage breakdown of the $308,776,000 in was begun and is now 607 complete.
operating revenues for 1976: Residential sales, 301; com-mercial sales, 207e; industrial sales,191; government and municipal, 37e; sales to other electric utilities, 279; and New Directors Welcomed other revenues, I?c.
Two outstandinf, business leaders, Richard D. AlcRae of Distribution of Revenue Dollars Jackson and Robert 51. (Bob) Williams, Jr., of Southaven, were added to the board of directors during the year.
(In Thousands) Te Both AlcRae and Williams are graduates of the University of 31ississippi, and have achieved wide recognition in their Fuel. . .$134,949. 43.71 respective business fields. 51cRae is president of h!cRae's, Perchased Power. . . 42,343. . 13.71 with ten department stores in six h!ississippi cities and one Florida city. Williams is a partner in the really development 177'292 57.42 firm of Reeves-Williams Builders in Southaven Both men Taxes . . . 29,721. 9.63 are active in business and civic affairs, and bring valuable Payroll . 16,498 5.34 experience to the board.
Depreciation. .. 18,151. 5.88 Other Expenses and Facing the Future Deductions, including hiaterial, Supplies, The year 1977 began with one of the most severe ice storms Rents, Etc. (net) . . . 21,026. 6.81 and most prolonged periods of severe cold weather in the his.
Cost of Capital: tory of Company operations. During this critical period, the Cost of Debt (interest) . 20,342. 6.59 Company met the test and filled its customers requirements.
Net Income (Cost of Preferred It was a period which called for complete dedication of all
& Common Stock). 25,745. 8.33* employees, who worked hard to keep the generating plants, TOTAL REVENUE . .8308,776. .100 00"c transmission and distribution system, offices and other seg.
ments in operation to supply power to homes, businesses and factories of the 285,000 customers we are privileged to serve.
0.77% paid as preferred dividends,4.82?e paid as common This same spirit of ingenious dedication and loyalty to diddends and 2.74?e reinvested in facilities to serve customers. assigned tasks by the 1400 employees causes the board of directors and executive tranagement to look to the future
. . with confidence. There will be more and more problems, Transm.ission & Distribution and they will not diminish in size; instead, without doubt,
. they will become even larger. Ilowever, challenges have a way i Construction expenditures m 1976 amounted t of bringing out the best e ! forts of our people. l Si5,987,000 for transmission plant and $8,751,000 for On behalf of the diectors, Company executives, super- I distribution plant. The major project m transmission was the '
visors, and employees, wa pledge to you our best in meeting construction of faci:ities to conr.ect the Grand Gulf Nuclear the challenges which lie ahead, holding always to our longtime Station to the transmission system. Of "otal transmission motto of " Helping Build Alississippi."
expenditures, $10,245,000 was expended for the 500,000 volt switchyard at Grand Gulf and for a 500,000 volt circuit Sincerely' from this switchyard to the Franklin EllV substation. This ,,
construction was approxi tately 50% complete at year's end and will be finished in 1977.
Substantia! progress was made in constructing 230,000
/ . (( ~
volt facilities in the Jackson area. A 115,000 volt line from the Ray Braswell EllV substation to the Rex Brown SES was Donald C. Lutken converted to 230,000 volt and conductor capacity increased. President and Chief Executive Officer 4
1976 Financial Review Summary of Significant Accounting Policies A. SYSTEM OF ACCOUNTS The Company's pension plan has been amended, he accounts of the Company are maintained in effective January 1, 1976, to comply with the accordance with the system of accounts prescribed by Employee Retirement Income Security Act of 1974.
the Federal Power Commission. The revised plan had no significant effect on pension B. REVENUES costs.
The Company records revenues as billed to its cus.
E. INCOME TAXES tomers on a cycle billing basis. Revenue is not accrur i for energy delivered but not billed at the end of the 'Ihe Company joins its parent in filing a consolidated fiscal period. The rates of the Company include fuel Federal income tax return and income taxes are alto-adjustment clauses under which fuel costs above or be. cated to the Company generally in proportion to its low the base levelsincluded in the various rate schedules contribution to the consolidated tax liability.
are per nitted to be billed or required to be credited to Deferred income taxes are provided for differences custorr. a. between book and taxable income to the extent per.
C. UTILITY PLANT AND DEPRECIATION mitted by the regulatory bodies for rate making pur-poses.
Utility plant is stated at original cost. He cost of additions to' utility plant include contracted work, direct Investment tax credits utilized are deferred and labor and materials, allocable overheads, and in 1975 an amortized over the average useful life of the related allowance for the composite cost of funds used during plant.
construction. The costs of units of property retired are removed from utility plant, and such costs plus re. F. ALLOWANCE FOR FUhDS USED DURING moval costs, less salvage, are charged to accumulated CONSTRUCTION depreciation. Maintenance and repairs of property and In accordance with its regulatory system of accounts, items determined to be less than units of property are the Company, through 1975, capitalized as an appropri-charged to operating expenses. Principally all of the ate cost of utility plant an allowance for funds used utility plant is subject to the lien of the Company's during construction represmting the net cost of funds first mortgage bond indenture. (interest on borrowed funds and a reasonable rate on Depreciation is computed on the straight-line basis other funds) used to finance construction, with a corre-at rates based on the estimated service lives of the var. sponr%g credit to non-operating income.
lous classes of property. Depreciation provided in 1976 In 1976 the Company did not record an allowance and 1975 amounted to approximately 3.37o and 3.1?o, for funds becau:.a amounts collected under rate sched.
respectively,on average depreciable property. ules include construction work in progress in the rate D. PENSION PLAN hase.
The Company has a pension plan covering substan- G. RESERVES tially all of its employees. Pension costs in 1976 and It is the policy of the Company to provide reserves 1975 amounted to $1,572,000 and $1,533,000, respect. for uninsured property risks and for claims for injuries ively, including amortization of unfur.ded prior service and damages through charges to operating expense on costs ever a period of 20 years. The policy of the Com- an accrual basis. Accruals for these reserves have been pany is to fund pension costs accrued, allowed for rate making purposes.
MISSISSIPPI POWER & LIGilT COMPANY We have examined the balar.ce sheet of Mississippi Power & Light Company as of December 31,1976 and 1975 and the related statements of income, retained earnings, and source of funds for utility plant additions for the years then ended. Our examination was made in accordance with generally accepted audit-ing standards and, accordingly, included such tests of the accounting records and such other auditing procedures as we considered necessary in the circumstances.
In our opinion, the above-mentioned financial statements present fairly the financial position of the Company at December 31,1976 and 1975 and the results of its operations and the source of funds for utility plant additions for the years then ended, in conformity with generally accepted accounting prin.
ciples applied on a consistent basis.
d.1
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- a yg February 11,1977 5
Mississippi Power & Light Company Balance Sheet December 31,1976 and 1975 ASSETS 1976 1975 in Thousands UTILITY PLANT:
Electric plant .. ..... .................... .. .... .. . .... .. $ 647,207 $ 604,059 Construction work in progress . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 28,061 35,772 Electric plant acquisition adjustments . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.951 3.113 Tetal ..... ........................................ . ...... 678,219 642,944 Less accumulated depreciation .... ....... .... ................ 156.5 % 140,033 Utility plant-net ........ .. . ...... ................... 521,623 502.911 OTHER PROPERTY AND INVESTNIENTS-At cost:
Investment in associated company (Note 3) . . . . . . . . . . . . . . . . . . . . . . 8,744 8,999 Other.................................... ... .... . .. ... 990 213 Total .... .. .................. .... ..... . .. ... . 9.734 9.212-CURRENT ASSETS:
Cash (d'ote 2) ............ ............. . ...... ..... .. . . . 2,562 4,304 Special deposits . . . . . . . . . . . . . . . . . . . . . . . . . . ...... .. .... .. . 763 764 Temporary investments, at cost which approximates market . ...... 17,705 8,000 Accounts receivable less allowance for doubtful accounts of S154,000. . .. . ........ .... . .... 14,192 11,542 Nfaterials and supplies-at average cost:
Fuel ............... .. ....... . .... . ... ..... . ...... 3,939 3.694 Other ........ . ............. .... ..... ...... . .. ... . 6,785 6,440 Other . . . . . .... ... .. . .... ..... . ...... .... ..... . 2.850 2.260 Total . . . .......... . .. . ........ .. .. . . ..... .. 48,796 37.004 DEFERRED DElllTS:
Advances for fuel oil purchases (Note 3) . .... .. .. . . . . .
- 5,897 Advances for gas purchases ........ ..... .. . . ... .... . 1.117 I,579 Unamortized debt expense . . . . . . . . . . . . . . . . . . .. . .. .. . . I,267 1.321 Other................... . ........ .......... . .. 1,485 1.085 Total .. . .. ..... .. ... ... . .......... . . ... . ... 3.869 9.882.
TOTAL ..... . .. . . .. .. . . .. .. ..... ... . . $ 584.022 $ $59.009 See Notes to Financial Statements.
e 6
LI ABILITIES 1976 1975 CAPITALIZATION: In Thousands Preferred stock (Page 10) ............... ........... .. . .. $ 38,077 5 38,077 Common stock, no par value (stated value $23 per share) authorized 5,000,000 shares; outstanding 4,540,000 shares .......... ... ... .... . ........ 104,420 1(M,420 Paid.in surplus . . . . . . . . . . .... ... ... . ...... . .. . .. . . 5 5 Retained earnings (Note 4) . ................. .. ............. . 50.381 41.912 Total .................... .......... ................. .. 192,883 184,414 Long-term debt (Page 10) ............. ..... ......... ...... .. 278.029 286.060 Total ... .................................... ............ 470.912 470.474
, CURRENT LI ABILITIES:
Long-term debt currently maturing (Page 10) .......... .. . ....... 8,760 -
Accounts payable:
Associated companies .... ...... .................. . ... . . . 5,625 4,980 Other................................................. 7,308 6,263 Customer deposits ........ ................ .......... . ..... 6,285 5,205 Taxes accrued . . . . . . . . . . . . ............ .... .......... .. ... 19,740 11,307 Interest accrued .. ....... .. . ......... ....... .. ... .... 6.315 7,687 Dividends declared . . . . . . . . . . . . . . . . . . . . . . . . ..... ........ 5% 5%
Other....................................................... 998 2.861 Total .... .................. . . . . . .... ... . ..... . 55.627 38,899
! DEFERRED CREDITS:
Accumulated deferred income taxes . . . . . . . . ........ ... ....... .. 37,636 33,748
' Accumulated deferred investment tax credits ... ....... ........... 17,180 13.366 Other................................................. 364 447 Total ......... ......... .... .. . ... .. .. . . ... 55.180 47.561 i R ES E R V ES . . . . . . . . . . . . . . . . . . . . . .... .... ... ...... ... 2,303 2.075 TOTAL ......... ........... . ......... .... . ..... $ 584,022 5 559.009 See Notes to Financial Statements.
7
Mississippi Power & Light Company Statement of Income i l
1 l
For the years ended December 31,1976 and 1975 1976 1975 In Thousands O P E R AT I N G R E V E N U ES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 308.776 $ 240.057 OPERATING EXPENSES:
Operation:
Fuel ...... ......... .. .. . ......... ..................... 134,949 93,398 Power purchased . . . .. .......... .............. ... . .... 42,343 35,322 Other........................................................ 26.093 23,941 h i ai n t e nan c e . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ............. 12.223 9,123 Depreciation ... . .... .... ... .... ................... .. .... 18,151 17.532 Taxes other than income taxes ................ ........ ......... 12, % 2 11,626 Income taxes (Note 1) ............. ....... . . ....... ....... .._, 16.759 11.560 Total .............. .. .............. . ....... ....... 263,480 202.502 O P E R ATI N G I N C O NI E . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ........ 45.2 % 37.555 OTHER INCOhlE AND DEDUCTIONS:
Allowance for funds used during constraction . . . . . . . . ... .... . - 1,853 N!iscellaneous-net . . . . . . . . . . . . . . . . . ..... ........ . ..... .... I,704 1,766 Income taxes (Note 1) .. ..... .... .. . . . . . .......... .. (913) (919)
Total ............ . ......... .... ............... .... . 791 2.700 INTEREST CH ARGES:
Interest on long-term debt .................. ... . . ... .. 20.074 18.154 Other interest-net of debt premium . .................. .. .... 268 1.298 Total . ... . .. ........... ... ..... ........ . 20.342 19.452 NET INCOh!E .. .......... . ...... . .... ........... . ..$ 25.745 5 20.803 Statement of Retained Earnings For the years ended December 31,1976 and 1975 RETAINED EARNINGS, JANUARY I . ........ ... .......$ 41,912 $ 36,477 A DD-Net income ........ ...... .......... . ..... .. ..... 25.745 20,803 Total . ............ .. ...... .. . .... ... .. .... 67.657 57.280 DEDUCT:
Dividends--cash:
Preferred stock . . ......... . ..... .. . .. .. . .. 2,384 2.384 Common stock ... . .... ...... .... .. ..... 14.892 _
12.984 Total .......... ...... .. .. . . . . .. . .. 17,276 15.368 RETAINED EARNINGS, DECEAlHER 31. (Note 4) .. . . . .$ 50.381 $ 41.912 See Notes to Financial Statements 8
Mississippi Power & Light Company Strtement of Source of Funds For Utility Plant Additions For the years ended December 31,1976 and 1975 1976 1975 SOURCE OF FUNDS: In Thousands From operations:
Netincome.................................................$ 25,745 18,151
$ 20,803 Depreciation ................................ .. .............. 17.532 Deferred income taxes and investment tax credit adjustments-net .. 7,702 8,019 Allowance for funds used during construction .. ................ -
(1.853)
Total .... . . .............. ............................ 51.598 44.501 Less-dividends declared:
Preferred stock ........................... ................ 2,384 2.384 Common stock ... .............. ....................... . 14,892 12.984 Total .... ..... .. ....................... ... ..... .... 17.276 15.368 Funds retained in business .. .. ............. . . ........ 34.322 29.133 From other sources:
From decrease in working capital (excluding short. term securities and current maturities of long. term debt) .. ............... .... ... 5.881 4,298 Refund of advances for fuel oil purchases . ..... ... ... ... ..... 12.752 -
Advances for fuel oil purchases . . . . . . . ............... ... . . (6,855) (4,374) investments in associated company . . . . . . . . . . . . . . . ........ . . 255 "765
.\fiscellaneous-net . . . . . . . . . . . . .. . ........ ... . ..... ... 2.084 2t>7 Total ...... .. ... .................... ... ... ...... .. 14.117 956 From issuance of securities:
Firs t mort gar;e bond s . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ... - 25,000 Pollution control bonds . . . . . . . .... ..... . ..... . .... 1.041 3.203 Principal amount of capitalized financing lease .. .... ....... . (242) (224)
Short. term securitks (net) .... . . ... .. . .. . . .. . ... (9.705) (11.700)
Total . .. ....... .... .... ..... ... ......... . (8.906) 16.279 I UTILITY PLANT ADDITIONS . .. ........ . .. . ........$ 39.533 5 46.368 See %tes to Financial Statements.
9
Mississippi Power & Light Company Schedule of Preferred Stock and Long-Term Debt December 31,1976 and 1975 Current Shares Call Price Authorized Outstanding Per Share PREFERRED STOCK Cumulative, $100 Par Value
- 4. 3 6% S e ri es . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60,(XX) 59,920 $ 103.86 4.567c Se ries . . . . . . . . . . . . . . . . . . . . . . ................ 44,476 43,888 107.00 4.927e Series . . ..... ..................... . ... . 100.000 100,000 102.88 9.16% Series . . . .... . .. .. ...... ............ . 75,000 75,000 108.64 7.447c S e ri es . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 100,000 100,(XX) 108.39 O t h e r S e ri e s . . . . . . . . . . . . . . . . . . . . . . . . . . . . .......... 325.000 --
Total .. . ............. .... ........ .............. 704.476 378. M in Thousands Stated at $100 a Share .. ............ . .... ... ......... ..... $ 37.881 Premium on Preferred Stock .................... . ... .... 1%
Total .............. . .. ............. ....... ............ ..
_$ 38.077 1.ONG-TERN 1 DEllT 1976 1975 First Afortgage lionds: In Thousands 2%7c Series due 1977 . . . . . . . . . . . . . . . . . . . . , ...... $ 8,498 $ 8,498 3%% Sedes due 1979 ........... . .. .. ..... . .. 7,500 7.5(X) 2%7c Series due 1980 .......... .... .... .. ... 7,500 7.500 3%7c Series duc 1983 . . . . . . . . . . . . . . . .......... 12,000 12,000 4%7c Series duc 1988 . . . . . . . . . . . . . . . ... ...... 15,000 15,000 4%7c Ser:es due 1995 . . . . . . . . ..... .... .... .. 20.00() 20,00()
5%% Series duc 19% .............. . ... .... . 25,000 25.000 6%% Sedes due 1996 . . . . . . . ......... ... .... 10,000 10,h 9%7c Series duc 1999 .. . ... . ... .. .... .. 20.000 20,000 9%% Series due 2000 . . . . . . . . . . .... . ... . . 17,500 17,500 7%7c Series due 2002 .. .. . ...... ....... 15,000 15,000 7%% Series duc 2003 .. .. ............ .... .. 30.000 30,000 8%7c Series due 2003 . . . . . . . . . . . . . . .. 20,000 20,(XX) 9%7c Series due 2004 . . . . . . . .. ... ... .. ... . 25,000 25,0(X) 10%7c Series due 2005 . ... .. ...... . .......... 25.000 25,000 257,998 257,998 l Less bonds currently maturing . . . ..... . . .. .. (8.498) -
l 249,500 257.998 Principal Amount of Capitalized 1.we-87c, due serially through 1993 .... ...... . .. .... 8,826 9,068 1.ess notes currently maturing ... .. . ........... (262) -
l Pollutio. Control lionds:
l 7M% due 20(M . . .... ... . .. ... .. 9,400 9,400
[ MM7c due 2(XM . . . .... .... . .... 8,575 7,982 l 6% to 8M7c duc 1978 to 1995 (net of $1,773,000 cash held by Trustee in 1976) . . .. .. .... ..... ... .. 627 179 Unamortized Premium on Debt ..... ........ ....... 1,363 1.433 Total (Annual sinking fund requirements,
- which may be met by certification of l property additions at the rate of l 1677c of such requirements, amount to
$2,655.000 for 1977.)- . ..... . .... . $ 278,029 $ 286,060 i
10
1 l
1 Notes to Financial Statements
- 1. INCOME TAXES 3. COMMITMENTS AND CONTINGENCIES Income tax expense consists of the following: The Company's construction program contemplates expen-1976 1975 ditures of approximately $34,000,000 in 1977.
in Thousano. The Company has a 19'1 interest in System Fuels, Inc. (SFI),
a jointlyowned subsidiary of four of the principal operating current :
subsidiaries of Middle South Utilities, Inc. (SFI stockholders).
[',d ,*,' '. A b5 7 ; SFI Perates on a non-profit basis in planning and implement.
Total .
Ing programs for the procurement of fuel supplies for the
.. . . 9457 3.541 generating units of these operating companies; its costs are Deterred -net : recovered through charges for fuel delivered.
Liberalised depreciation . 5436 s A67 (Jnbilled revenues . . .(1,131) 491 The Company has made laans to SFI to further its fuel supply neterred ruel expenses . .( 17) 495 business under certain loan agreements which provide for SFI 3.888 6 p s, to borrov from its stockholders up to $156,500,000 through Investment tax credit adjustments-net 3,814 1,960 Decembel 31.1977. As of December 31,1976 the Company had loanei 68,740,250 to SFI pursuant to the loan agree-Total charged to operations . 16,759 11,560 Chirged to other income and deductions ments, and the Company's share of the unused loan commit.
913 919 ment is approximately $19,890,000. Loans mature in 10 and Total . , .517,672 $ 12,479 25 years from the date of borrowing.
In connection with certain bank borrowim;s by SFI totaling The total income tax expense reflects reductions resulting $42,184,000 at December 31, 1976, the Company and the primarily fronu other SFI stockholders have covenanted and agreed severahy (a) the exclusion from taxable income in 1975 of the in accordance with their respective shares of ownership of allowance for funds used during construction, and SFI's common stock, that they will take any and all action (b) the effect of tax reduction attributable to the filing of necessary to keep SFI in a sound financial condition and to a consolidated Federal income tax return. place SFI in a position to discharge, and to cause SFI to dis-he effective income tax rates for 1976 and 1975 wer 41g charge its obligations to the lending banks.
rnd 38'i, respectively. During 1976, SFI entered into a contract with a joint venture The Federal income tax returns for the years 1967 through for a supply of coal from a mine to be devel; ped in Wyoming.
1972 have been examined and assessments which have been The mine is expected to provide 150 to 21t, million tons over protested have been proposed by the Internal Revenue Service; a period of 26 to 42 years.
also, the years 1973 1976 remain open. Management is of the opinion that adequate provisions have been made for any taxes SFI made a Nance payments under an oil supply agreement to thtt may ultimatel) be assessed. a supplier in connection with the construction of a refinery.
During 1976, the supph.er was sold to a major oil company and
- 2. LINES OF CREDIT AND SHORT TERM BORROWINGS SFI (1) entered into a new long-term oil supply agreement The Company has obtaintd regulatory authorization to make with the oil company providing for the sale to SFI of up to short-term borrowings of $44,000,000 through bank loans 50,000 barrels of oil per day for a twenty-year period; (2)
(not to exceed $16,000,000) and the sale of commercial agreed to cancellation of the oil supply agreement with the pag:?r. Accounts are maintained with the lending banks, and first oil supplier; and (3) received repayment of the advances although immaterial balances in some of these accounts may previously made, by SFI, together with accrued :nterest there-be deemed to be compensating balances, most of these on, in the ageregate amount of $67,120,000. The Company's accounts are working accounts and fluctuations in their portion of this repayment was $12,752,000.
tclances do not reflect or depend upon fluctuations in the amounts of bank loans outstanding. The amount of the unused 4. RETAINED EARNINGS lines of credit as of December 31,1976 was $16.000,000. The indenture provisions relating to the Company's long-term he ba.tk loans and commercial paper notes arr. unsecured debt provide for restrictions on the payment of cash dividends short-term loans wit . various maturity dates not in excess of on common stock. As of December 31,1976,$28,766,000 of nine months. Interest rates on bank loans are the ; % rates retained earnings are free from such restrictions.
In effect from ilme to tune of the lending banks. Dur ,, r.he 5. QUARTERLY RESULTS (Unaudited) t 7ehe months ended December 31, 1976, the maxino.a. Unaudited operating results for the four quarars of 1976 tggregate amount of short-term borrowings outstanding at tic rottow:
(nd of any month was $5,300,000. The average amount of Quarter Imded short-term borrosings outstanding during the twelve morbs htar. 31, June 30. sept. 30 nee. n ,
ended December 31,1976 (based on the average of the sur >f 1976 1976 1976 1976 d tily outstanding principal balances) approxim. ed
$1,331,000 of cornmercial paper. The approximate average operating revenues . .566.530 568, 40 590,747 $ 8 3,4 s a int: rest rate (determined by dividing the actual interest operating incoma . 10,909 s ,41 s i4,475 11,497 expense on short-term borrowings during the year by the Net income 5,9 s 7 3,777 9,517 6,499 av;r:ge short. term borrowings) was 5.4"c for commercial The business of the Company is subject to seasonal fluctua-paper, tions with peak periods occurring during the summer months.
11
Accordingly, earnings information for any thrmmon th with reporting requirements, estimated replacement cost in-period should not be considered as a basis for estimating the formation is disclosed in the Middle South Utilities, Inc.
results of operations for a full year. annual report to the Securities and Exchange Commission on Form U5S.
- 6. ItEPLACEMENT COST (Uniudited)
The impact of the rate of inflation experienced in .ecent years has resulted in replacement costs of productive capacity that 7. ACCOUNTING POLICIES are significantly greater than the historical cost of such assets The summary of significant accounting policies on pat:e 5 is reported in the Company's financial Matements. In compliance an integral part of these notes to financial statements.
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1 Directors
- Donald C. Lutken Jackson, President and Chicf Executive officer of the Company
! G. Lawrence Adams Natche:, Attorneyot Law l Norman B. Gillis, Jr. AlcComb, Attorney <t-Law i Robert M. Ilearin Jackson, Chairman of the Board and Chief Executive Officer, First .:stional Bank
) J. Ilerman Ilines Jackson, Chairman of the Board and Chief Executive Officer, Deposit Guaranty National Bank Russ M. Johnson
- Jackson, Retired Chairman, Deposit Guaranty National Bank J. II. Johnston, Jr., M.D. Jackson i Robert E. Kennington,II Grenada, Chairman and Chief Executive, Grenada Banking System Richard D.McRae Jackson, President, hIcRae 's, Inc.
i Floyd W, Lewis New Orleans,Ivesident, S1oddie south Utilities Inc.
j LeRoy P. Percy Greenviue, Planter Robert M. (Bob) Williams, Jr. Southaven, Partner, ReevesMilliams Builders l
! auember of the Advisory th>ard
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- 13 . - - . _ _
1 1
Mississippi Power & Light Company Record of Progress 1966 -1976 1976 1975 1974 El.ECTRIC OPERATING REVENUES (000s 031ITITD)
Residential . . ..... . ... .. . .... . . .... $ 91,849 $ 74,276 $ 07.690 f Commercial . . . ..... . . . ... . .. 60,855 47,484 43,559 Indust rial . . . . . . . . . . . . . . . . . . . . .... .. . .. . .. 5d,645 42,863 41,743 Government A hlutacipal . . . .. .. ... . . . 9,899 7,022 6.163 Cooperatises a hfunicipalities .. .. . . ... 25.622 21.399 13,362 Total From Energy Sales (kliss. Area) . .. . .. . .
246,870 193,064 172,517 Sales to Other Public Utilities . .. . .. .. . ... . 57,298 43,084 10,484 Total From Energy Sales . . . . . ,
304,168 236,148 183,001 hiiscellaneous Revenues ... ... . .. ... ... 3,176 5,972 574
_ 2,063)
Deferred Fuel Adjustment Revenues * ..... ..... . .......
1,432 ( (5,134l Total Electric Operating Revenues .. . . . .. . . $ 308,776 $ 240,057 5 178,441 El.ECTRIC ENERGY SALES OIKWill Residential . . . . . . . . . . . . . . ... . . . ,
2,491,067 2,440.460 2.268,95C Commercial . . . .. . .. . 1,537,169 1,457,505 1,356,172 Industrial . . . . . . . . . .. .. .. I,935,573 1,751,042 1,793.059 Government A hlunicipal... . . . . . ... 326,275 302,319 271.23D Cooperatives & hfunicipalities . . . 1,064,636 990,309 938,20g Total Energy Sales thfiss. Area) . . . ... . . 7,354,720 6,941,635 6,627.621 Sales to Ot;;er Public Utilities . . . 2,624,001 1,638,144 487,09 v Total Electric Energy Sales . . . .. 9,978,721 8,579,779 7,114,71E El EC1RIC CUSTONIERS (END OF PERIOD)
Residential . .. ..... . . ... .. 245,384 241,739 237,082 Commercial . . . .. 34,718 33,801 33,47(
Industrial . . . . . . . . ... . . .. . .. . . 3,247 3,247 3,26t Government A hfunicipal . . . .. . 1,920 1,879 1,781 Cooperatives & hfunicipalities . . . 67 66 62 Total Customers (hfiu. Area) . . . .. 285,336 280,732 275,67C Other Public Utilities . . .. . 2 1 1 Total Flectrie Customers . . 285,338 280,733 215,67s SYSTE%I INPUT (%1KWill hiiwissippi Area . . . .
7,995,184 7,583,971 7.249,8 %
Other .. . . . ..
6,275,856 5,369,242 4,353.671 Total Sptem Input .
14,271,040 12,953,213 11,603,562 1,733,000 1,642,000 1,640,000 PEAK LOAD (%IISS. AREA)-KW . .
1.OAD FACTOR (%11SS. AREA)-PER CENT . 53 52 51 NET Pl. ANT CAPAHILITY-KW 2,752,000 2,752.000 2,752,900 17,859 17,713 17,461 CIRCUIT SIILFS OF ELECTRIC LINES .. .
TOTAI. ELECTRIC UTILITY PLANT (c00s 031ITTED)
Production .. .. . . .. . . . .. . . $ 338,118 $ 299,583 $ 292.491 Transminion . . .. .. . , .. . 118,137 !!8,450 109,921 171,955 166.590 158,252 Distribution . . . . . . . . . . . ..
15,366 14,763 General & Other . . . . . .
15,727 Total Utility Plant Completed . .
643,937 599,989 575.473 3.270 4,070 1,211 Plant Held for Future Use ..
28,061 35,772 16,688 Construction Work in Progress . . ... . ..
El ctric Plant Acquisition Adjustments .
2,951 3,ll3 3.293
$ 678,219 $ 642.944 $ 596,670 Total Utility Plant . .. .
- See Item H to Summary of Signi.~icans Accounting Policies.
14
1973 1972 1971 1970 1969 1968 1967 __1966 5 47,473 $ 38,096 $ 32.499 $ 30.097 $ 27,353 $ 24,528 $ 21,573 $ 20,389 31,294 25,701 22.126 20,290 18,507 16,797 15.126 13,939 26,853 22,399 19,439 37,535 17,076 15,979 14,228 3,193 15.037 3.975 2,842 2,707 2,437 2,194 1,876 9,915 2.003 9.884 7,914 7,027 6,299 5,592 4,446 4.796 119,509 99,273 84,820 77,656 71,672 65,090 6,684 58,535 54,878 15.223 9.423 4,911 5,090 4,929 4,452, 426 126,193 114,496 94,243 82,567 76,762 69,542 63,464 55,304 449 374 393 364 342 309 279 276 i 136,642 5 114,870 $ 94,616 $ 82,931 77,104 $ 69,851 $ 63,743 $ 55,580 2,356,073 2,032,670 1,802,675 1,674,415 1,470,430 1,74,923
. 1,069,029 991,362 1,380,035 1,213,432 1,091.553 1,007,557 907,912 823,035 738,521 677,002 1,787,741 1,677.137 1,624,499 1,464,602 1,410,912 1,351,195 1,345,938 238,624 210,951 1.267.425 262,645 219,463 179,178 157,279 142,904 136,781 988,351 1,089.349 966,015 959,649 860,842 765,837 659,025 601.110 6,774,845 6,251,212 5,704,205 5,317,I74 4,829,274 4,372,269 3,955,417 3,673,680 312,454 1,269,927 1,282,153 984,933 1.143,398 870,335 832,I57 _ 108,742 7,087,299 7,521,139 6,986,358 6,302.107 5,972,672 5,242,604 4,787,574 3,782,422 229,761 206,222 198,435 191,529 187,670 183,538 176,783 180.415 33,109 30,629 29,453 23,419 28,109 27,532 26,941 26,149 3,213 3,I68 3.209 3,140 3,022 2,990 2,892 2,816 1,731 1,618 1,558 1,514 1,447 1,393 1,347 I,318 61 74 75 71 70 67 64 63 267,875. 241,711 232,730 224,673 220,318 2 i l,659 215.520 207,129 1 2 3 4 4 4 2 2 367,87G 241,713 232,733 224,677 215,524 211,661 220.322 207,131 F.378,216 - 6,906,300 6,246,040 5,875,777 5.326,174 4,783,640 4,337,494 4,062,033 0,160,152 5,081,123 4,700,857 4,429,587 4,957,040 3,677.783 2,318,574 334,842 1,538,368 11,987,423 10,946,897 10,305,664 10,283,214 8,461,423 6,656,066 4,396,875 1,565,0C3 1,476,000 1,343,000 1,238,000 1,176,000 1,005,000 924,000 887,000 94 53 53 54 51 53 54 52 9,002,000 2,002,000 2,002.000 1.231,000 1,231,000 1,231,000 1.220,000 1,220,000 17,166 14,279 14,061 !),892 13,783 13,588 13,418 13,103 17?,217 f 166,537 $ 166,h4 $ 106,419 $ 106,434 $ 106,582 $ 105,379 91,535 91,068 85,074 79,225
$ 106.030 79,218 76,988 71,350 56,415 148,492 130,191 124,523 719,198 113,428 108,049 14,355 102,827 97,968 13,598 13,372 13,283 12,401 11,765 8,429 7,689 430,599 401,394 389,333 218,125 311,481 303,334 1,144 288,636 267,451 1,146 594 564 564 511 121,908 50,070 396 394 12,396 53,257 16,445 3,524 6,844 13,612 3.067 556,718 $ 452,610 $ 402,323 $ 371,946 $ 328,490 $ ,107,419 $ 295,876 $ 281,457 15
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- n A :nilestone in the construction of Grand Gulf Nuclear Station near Port Gibson took place on February 12,1977, trith the lifting of the 830-ton reactor vesselinto the containment building. At year's end, construction on the first unit tras 38 per cent complete. The first unit is to be completed in 1980, and :cill have a capability of 1,250,000 kilou atts The second unit, icith the same capability, icill be completed in 198-1. The project is orcncd and being financed by
.Wda;' South Energy, Inc., a subsidiary of .\ fiddle South Utilitics, Inc. It is be.ne constructed and u ill be maintained and operated by .\1P&L a
Mississippi l' amer & I.ight Company in i K iu i n I1 $ Posi mi l'ost Office llos 1640 l' A I D
,lackson, Mississippi 39205 , g sgs PliRN111 NO. 24