ML20052D874

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Annual Financial Rept 1981
ML20052D874
Person / Time
Site: Zimmer
Issue date: 01/28/1982
From: Frazer R, Killen R
DAYTON POWER & LIGHT CO.
To:
Shared Package
ML20052D873 List:
References
NUDOCS 8205070275
Download: ML20052D874 (28)
v • d • e


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r Cost Average 1981 Dollars Net Property and Plant Adjusted for Inflation At Decenter 31. In1 $ 1.C55 3.141 7.955 Earnings on Common Stock Adjusted for inflation 1%1(a) S 75 16 26 1MO $ 47 13 7 1973 s 17 1 18 Earnings Per Common Share Adjusted for inflation 1581

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S 2 51 53 86 \

ITO $ 1 85 U3) 23 13/3 5 2 01 04 78 Total Adjustment to Earnings on Common Stock for 1981 3

Adit:nnM po, s!on fcr depr. uta,n ard a nortyato;n $ 149)

{ canonnc !m.s ff om br, ' q propmty and ;? ant (86) fcononm gam from hr ' P 3 faH mor ey obhgattans (M 89 Total ad,u stment to e tromgs on t inan stO O (c) $ (46)

(J) [drnmys on COrrJ10n stCO, bdSed Gn COfikentiurM kStDrid COST, "e G?USted On a Currtnt cost and constant dOLr hnis to rob ct an additional prosson for de; ociation and anorti!3 tion 1he amustments of $51 m1 mn for cunent cost and $4) m wn for constant dohar were '

ca!culated by applymg current deprm.Rit:an rates to the tu nt cost and constar:t dahr pkint lounts income toes are not aapsted i I I l ib) the economte gun ham ho dmg hied m"ucy oNnat:uns s. s $120 i don and $11R nn; hon for {

1%0 and N71 respr o m!y '

tc) The ad.ustment to earnmys on common stock cn a cunem wst b;ss er,uais the adjustment on a cor6 tant duttar t asis Ihn ad,ustment reflects the erfect of raie rcgulation wh+ch hm ts the r, casuy of propet ty and p: ant to orgnal(histartad mt DJnng 1%1. the current tnst of "oporty an 1 p! ant incremed S203 m ; hon. which is $61 mdhon less ti,an the effats of generalinN ion The fo!!aw:ig schedu!c, a compan3on of reported h6tonca! d;ta w;th data adjusted for general j mfiatmo Shows that a sq;nthcant part of the reported Camp na hse-year growth has resulted fran mNatan Inr cunple, the in:rease m revenues between the years 1977 and 1331 was only $109 m4cn after adpntment for the effects of mf; anon, rather than the reported $333 milbon increase InNation h.!s actua!!y c3used a decrease in the purchasing power Gt the Cempany's divtdends.

Increase (Decrease)

Year Ended Between December 31, 1977 and 1981 Annual Percentage ia <s 1977 1981 $ Rate Ut:hty Sern e Revenues l

~as reported $ 447 $ 780 333 15

-m awrage 1981 da:!ars . $ 671 $ 7SO 109 4 Net Assets at br End at Net HecaseraNe Cost I

-as reparted $ 330 $ 565 185 10

-m average IMI doMrs $ $56 S 54 6 (10) -

Cash Dredends-Declared Per Common Share <

-as reported $ 1.66 S 1.82 .16 2

--m average 1931 dMars . $ 2 49 $ 1 82 ( 67) (8)

Maet Poce Per Common Share at Year bd

-as reported $ 18.13 $ 14 63 (3 50) (5)

-in awrage 1981 dc!:ars . $ 2653 5 14 12 (12 41) (15) (

1 Average Consumer Pnce Index 181.5 272.4 90 9 11

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6. Commonly Owned Facihties Inc Cc 4 m it Ce n h &[ha:Com y_  : on corp. n po ects Ca umbus and i

f 2;cthr f 4 Cf 3 [S S,c CCNry C//n ai te:. ant, :n : 3r' c+ rt1D cR i C gei4 rdimy cnd I to , ni f+ +

<s M F+,:maje r* , nn b :M v.a! ccmtruct on Tl e a:;rcements

< w";in>rc , ne;r Q -Je e n md M c:d cc , , to pa r as cum"F p share et constructmn and CM '4V,4 cW S rd erb fd t i !nj : 4 I m tr.e S' ' . ent cf Rmis et Operatmns :s the l

Ccr , a[S'ku 'd u:r t < t e g i es Th, e 0 9 c : s e '. t mchj as Onhcr fue! Used in piCduction U,r o f ;t.n g i 1-j ; d 'bi L'r > at Cece' :!:cr 31,1981, is as h!!av.s.

Company Portion Accumulated (I Punt Under I Company Plant in Provision for Unit Ownership Service Depreciation Construction It0 ' cien U c: Wd Umt S '0

, 5 af $13 $ 1 Co' , +: Unt4 Mh 22 6

'; tac 1Critan E 114 35  ?

h t h it Umts /M 36 SS 16 3 Iast W d Umt i 25 3 f st B,-nd Umt 2 31 127 1 1 Kr n Stutt u 67 15 310 lenmer [taim, hw kari 31 5 343 Terman et uy n';

ON i nh p p0! Lent !~;e s) fd 11 1 htai 55% 585 5670

7. Supplementary Information The mformatma prm!"4 to ;w e; an estenate of the e:cnna t :mpact inflation had cn tbn Company on Reportmg the Effects of 4 91tN: comunan sharetcoteri unestment dunng ':31 it is mtended to supp!ement the bas:c Inflation (Unaudited) fmomi stae wnts < F rh av tosed en canwntmnd t"starial cost The in m.ai ho , ntm] St mdads Board through its Statement No 33. requires that two kmds of suppkmentari mfmnutmo t e de ctosed Cunent cost intornutmn represents the cost of an item tod.y n Oppo ed to its c orventional histanca! cost. /.!Nh is the cost of the item at the time of purch15e Ibe Com;uny S (tdomi cost Utkulatmns are based prUnardy en the h.mdyWutman lndex ut Pubh Utaty Cn stnFtran Costs Constant daLr mfunnation reflects a@ustments to the i m verton d fmam ui statermnts far changes m the generallesel of pnces (generalinfhtion) The Compnis cm Wut doWr cc colationa :re basM on the Con 3umer Pnce Index for All Urban Core w .e s The Compor is suNect to rate rc<;ubimo and tax laus that are bared on the recovery of enginal thistornah cost on9 iberefore. m'btenary mcreases m the due of the Cornpany's property create nn f.i OnMur: hM because the CCf , my t$ f eCOV0nPg !!S cDSt O! investments in daHarS that hdVe less pun:hasmq puAet Conventmnal accountmg for h.stancal cost dces not recognue this economic los; nat the part.any of twitmg ! n that anses threugh hnancm3 ac,ht.es f vwth f:xed mancy obluptians, such as hmq term debt and preferred stacir.

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4. Commitments and The Com;any esteate > that its rt.nstruction pogwn < 1 Ocunt to $225 m han in 1582 and $102 Contingencies mchen m 1583 Ibesa amaunts inch.de the Com;w s e se et construction costs associated with its commonly owned Le- nes (see Note El The Company's est. mated construction expen6tures could f be sein f: candy increas"d bmh:Le of caostructwn doterra 5. ;%ernment regu!ahans and other cncertainte conch Tlng the ccnstruct:0n of fac h!a s In Septembet l'380 th9 CO% ly anMCP Jed [.bns int the canceNhon Of the ScCOnd unf t Of the KWen a stahon The Company r, a reedy negonatmg .. th ,endcrs concernmg the c mcchahon charges.

Y/ht!O the recWveiy Of dFPCs DOf t O! Such cCsts '. di depe !d UpCn re]U5aiOTy tre3tFcnf fCT acCfsuntthg purpnses the CC"pany hn detted to reduce i et mcome m 1981 by $19 mdb0n repre .entmg tbo insse ngmate i to date This ., mot nt repesents substant@ a!! the lasses DDif tpated

5. Financiallnformation by The pnaury busmess of the Company is the s;eneratmn, tstribut:an and sa!e of e ectr, city and l Business Segments purthne, distnbunon and saie of notarat gas The toLowr g is certam infmnwtion relatmg to the Companys busmess segnents: j

$ ' : e ..s e a 1981 1980 1979 for the years ended Cecernber 31 Income before provismo for mwme tues (a)

Electnc $ 15R481 S 91.812 S 80.575 Gas- 4,322 6.737 6.090 Stf am heatmg (1,126) (446) (521) l Nnn operatmq 29.667 28 8M 26.291 intere>.! charged to operations 6 0.872) (47.957) (37.456) latal S 130 475 S 79.010 74 979

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totonm tams Uectoc S 52165 S 24 363 S 20,754 l i

Gas 343 1.112 433 <

SINm heahog (720) (332) (362)

Non operatmy (16.003) (10.904) (7.442)

Tota! S 36 485 5 14 239 5 13 443 Prousion for deprec:ation and arnortuation Doctnc $ 33.033 $ 29 483 $ 27,738 Gas 3 062 2 593 2.226 Steam heatmg 203 257 219 Tota 6 S 36.363 S 32 345 S 30 183 Capital expenditores Elettnc 5 241,540 S 214.997 5 214.657 Gas 7.122 7,087 2.0 13 Sicam heatmg 185 261 1.246 Total S 248 847 S 222.345 $ 217.946 At December 31.

Ident:f;ab'e assets Llectne S1.065 060 $1.4 78,630 $1,279.385 Gas 125,5;6 120.442 105.332 Steam heatmg 7,755 8.828 10.346 Carrarate assets (b) 84.271 77.034 85.745 Total S1.882 632 51 685 044 S1.480 808 b) bdudes iatersegment transactions which ate not materot <

(blinctodes prinunN cash, Oct0 Jots rectivable and certam deferred items

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f*rc,, Cns Ihc f:;ih , r. g W . Of pre!Hred stvir W.h are rd t. ' ? in - i nt l'; r"f, ' it nry E T kmg f und re:, wrm t.ts m sy t w im rN 'd at it e cpt:0n Of t% Ca , m/ at the fu F q per share f fd;9 { t R,3 j.f M >PM M'i 6('dend5 .

Current Redemption Annual Sinlung Fund Pnce Requirements

! Pnor Eventual Amount to M.nimc.n (1) (2) 12 ' 6. - Ser nes G

. Sil? 00 11121 5101 00 5' 11 1-73

?s' kries H $!19(D 4183 S M100 51 4143 9'6,Senest $110 9J 5-1 El 513' 00 LS 6185 11 f E--  % r e, J $111M 11-6 50100 3 71 E5

  • (!) Perter ic 5;? the t i d a muni of e i'.h issuo Ol ' d og fond wit m r ment r sie UU f t. h;> , t h or; y N: moi ; for Ser.cs G, H l ;tnd j '! E!!c;.t!.e WI0 rest (dies 6f dMdend ylU!d$

le' , t h-m tiw ;s ar o y.ci 's of t h r' inw tese sene - / to the cura reden ption mtes in the

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  • Mr !ituy tr@: r,tien.; im peh.< red stuck Over the cc ri f%e girs are as falows i Year $ in thousands IT) $ -El 1983 $3 H0 IU1 $3./ 50 E 55 500 1M Su!W If tot - fvt r;uvirrN g referred stod hAnda are m arteits the preferred sharehoMers would have It" r.ght to rb t on ! third of the n embers r f the Scard al Daettors Long-term Debt Sut r. tar uy it pmperty and pant of the 1:nn s m, a sWect to the hen of the mortg me secunng the Ecn panys f;r<t mortgye bonus Ini;st i:mt pt ti d ' d hnj fu ;d trqa rements for eat.h of thr? " ext hVU itJr5 averJQe $4 b m:ihl'1 and na/ he s ite,hed Ly la) mh. (b.I de Ner y of lmnds of the respectne senes or (c) unfunded property M htim , at f>0 . cf the Mswr of cost or f:ur v-Jue ttwreaf Ih tl mOr t y iye '9! pr'!.Mles h T JI:MU d p?ymuf!!S uS J PM D!cridnCC aflj rtThCU'Hent fund Of a Suit 1 '

e ;d ni to tf e nun nnun pr ,

4 un far dernwtirn Ls def ned) v.htch pprom: mated $23 mdhan m 1H1 Th-s tuod mm be .,Jtisfmd by la) cmh (b) d.hy cf bands issued under the mortgye or (c) t h.' n;t of unhoWd propi rty aMtuns The Com;ung hn been u',mg the cost ul unfandeJ propaty aMtions to meet thr se requ:rements of the Wh hut ruy fa =

a ddimr iternatne m the fofu r o th respect to certam senes of bc lds T hi uunts nf outur, ties id : uni; tory rehmptier 3 for first nortgage bcads over thrt next five yrms are as fa n n b

Year $ in thousands 19i2 515 000 1933 19dl $16 E0 1TS $ 4 333 l 1% $ 4330 i

8 Utet/ pant deprer si:en s r.a'cutavf usmg the strmght ne metFcd Ahe:h deprecates the cost of prr perty. fe:.: saba; '

' e m equ31 amounts cver ;ts est 7ted ; wU !;fe. Std es are condJcted penotcany as a La ms for alustmq these utefullr.cs e d stage u :.es to re"ect current conmtton The and cem;wie &prec atm , rates by ut :y me A te h s:

1981 1980 1979 Lh tinc pLnt '

il 31 32 G is ;.! ant ?8 25 22 Stram pbnt 24 23  !?

Reclassifications Certin rednsif,ubans t c neen made m the pnor ye 's to mM them ccTarable to Ihe dash ,rtions of s:e m m 1931

2. Notes Payable and Notes papb!e at Docm o e 31 !M1 mide $59 2 m " an of the Com;nny's con uetml papcr.

Compensating 8 lances Ilm Company hn Shri m:il.on adaue to it under t.vo ro. , ,g bank mn agreements There were no loans cu!sta~1m:. " : der thew rin monts at Dec ember 31,1531 At Dec ember 31.1%1. the Compyy Nd m!arrna' hnes et c'e'i t a".gregatmq $35 7 mdhcn, a4 cf wh:ch wem unosM in s cpart of these imes. the Ce rpany s regured to mmntrn merage daJ/

compenwr mg tances, h ised on the un'xs' records ct :que ately 54 5 mnon at December 31, 1931 3 Capitalization Common Shareholders' Equity Shares of comann stock wore issued as fo!lows 1981 1980 1979 Pubhc offennqs 3,100 000 3 000,000 -

Dudend remsestment pun 555.906 4583:9 360 732 lm;k yce pb m, 240.565 201436 118.631 Ictal 3 M 771 3 663.385 479.416 At December 31,1981, the Com;nny had 1.851,438 and 267,235 shares of authonzed but umssued I stod reserved for the d;wdend temvestment pbn and emp cyee puns. respectbely.

The clunges m other pmd :n capital are as fecews s o t' <. a 1981 1980 1979 thbm e at twg nnmg of year 5178.700 $153 511 $149,789 Piemmm. cet of expen:,c, receacJ trem

ates of comr
on stm k 21.274 25 fA7 3 995 Dther 191 (4b8) (273) i Buiam e at end of year $100165 5178 700 $153.511 Preferred Stock W:thout Mandatory Redemption Prows 4ons The fe!!anmg sene: of preferred stock nuy be redeemed at the option of the Company at the ffwng per share r 'demption pnces. phis accrued de.:dends Current Redemption Pnce Pnor Eventual Amount to Minimum 3!M Series A $102 50 -

5102 50 3 75% Senes B S103 00 S103 00 3 00; Senes C S101 00 -

$10100 1431i Senes D S105 0 % 5-1-84 $103 225 7 70% Series E $103 00 4176 5101 00

/ 3 75^. : Series F $105 00 6-2 83 $10100 J

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! The fdoung uheddes de pmt the computation et tan expense and the current and defened cor"ponents of 134 expense l

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1981 1980 1979 l

Computation of Tax Expense f edend mcome in at staMory rate ar.ph:d to po: tax w /ne 550 013 A6 S M 345 46 $34 M O 46 Dare r;es m tas frvn Af C Wh.ch does r'ct twstitute ta<aMe mt ome 22.1 E8 17 1 g r/J3 24 15.545 20 y fuess of tu depu < stma and

\ an ca t riation o.4 e t a.k depreoation and amortvatmo r ?! deferred 2 450 2 1523 4 4,341 6

, 17.. stment tan cred + encrivei 724 -

562 1 418 1 Other inet) (1314) ( 1.i (593) (1) 743 1 ,

lot 31 tu er;n:nse $36 485 2d $14 239 18 $13 443 18 Components of Tax Expense ine:, nurent'y papM. $ 5 F63 $ 2.105 $ 2.646 Octe tal ta .et b!mrahied di ;"e(i steun and s

orteaten / C47 5.359 4.023 O!he 2437 133d 1 S t2 Deferred m.-e ' . :nt tar neda im ti 17 e54 4,473 3.621 Other :t +n 3284 644 1.311 IntM i a c*pe w $36 455 $14 239 S13 443 Pensions Ihe [nm;:any s trustm! btutment lnceme Plans, wbrh tear substant:ady all employees, do not relere contid.utn ns !"i the tot ;1mices The Cor".panv s contnbu?'0n proudes far the annual pens:on ,

enmn3 e, dudmq the r ;rtaanon of unfunded past servme costs o.or teecaty years. Coninbutions amamted to $6 3 rHhnn m 1M1 $5 / mean m lEC and $5 5 ne han m 1979 1he r.tuaru! prewnt u es of aun dated pan bencf.ts based on empioiees cdanes and y.er m e n unnnq a 0 - rate of return were a fouens.

51 U o,t 1981 1980 Ve s t r e 576 925 $ 10.4%

Non wsted 11 12h 10.443 inta! $ % C53 $ E0 833 The rn t anets a. WHe for ;ui h t enet.ts v.ere $U2 mAca at Jraary 1,19S2. $94 meen at January 1,190 and $l1 ndon at J:maary 1.1%0

$ Property and Plant. Maintenance and Depreciation Prepelty and phnt in scrwe is steed at the cost ahen f ast devoted to ut6ty service (ongm:ll cost)

Cone,tructmn costs mrlude materui, labor, overheads for payroil-related costs admtmstratNe and gel;elal esper;s , and AFC V. hen a untt of property is ret: red the accumulated provis;on for

> dynuution is daiged mth the Imak va'oe of the Property piss the cost of removal. less sa'vage vaine Mamtenance of preperty aqd rep! > cements at mmor items at property are charged to the appreprote ma'ntenance envnse accounts I

6l Notes O the Financial Statements t Surnmary of Significant Principles of Consolidation Accounting Pohcies The Com;nn/s frrona > statemer.ts are conscated to mWe the accounts of a wFeN ewned subWy w'ah cans the Carpan corporate heada rius teim; M sign hcant intercompany tranutticns h1ve ' cen ewated in cornc':daten The Com;any 5 other substdora.s are not

<;n6nt r a me act .1 for en tN eqmty Lms n c.estments Revenues The Com;#y ment runac > b mj on matt 4 rego ,s of couomers' meters The re.enues ,

m:%de amounts bhd Ic us 0mers throur;h fuel and g n ccst ad,ustment c!auses Purchased Gas and Fuel Costs l 1ho Com,ang recrrds gis coct m an expense as !t is L, ed to custamas through the gas cost ahntunt &u e The parton 0! gas cost , rec 0verah?e refur;dn5 m future penom and rebted mcuna tm s me rh-f"trer*

briff *O bepte' der } jQ the (Ust Cf f.p.i USid 10 p!( /! Ce t FtiiCdy 'js U Apense'f DS thy fuel WaS censumi As a re Jt of an order by the PubV Utit;es Ccmm:smn of CNo (PUCO) offectne Septmbu Wl. the Com, ni bepn b:!nnq t h;ctm fui! ,t s tused on a fuel rate ahKh is estab'nbed for a su manth pened Ibe ddferer.ce tu u,een / * :a! fuel costs ud fuci revenues

!IU'l to custurGN , On the (Med rate ; rccuyttfM Gr rWad fe in futare permds i nd LS deft:Trld a:urg Mh rewed mn t a x e .,

Allowance for Funds Used During Construction Ma mce f ar fc i n i mf danng cm .truct on (AF C) ret &ts the estmnted wst of cetA funds m'n o to utnty piani cM:r (custr:tmn ibn cost re;rcu nts mierest ch r[;es 3 on L::troced

  • ' ui; an<f t he n :.! Of c:ppty f und3 Thrs .Frcuntmt, prit ce reSuits in th se capita! Costs bemg un hht as p.vt of the Lt ty 6tn! ;the s ne n,anner :n 12 ar : N troterd (0sts. The amount of AIC e a tu RIRi t Luth the . nOunt Gl CCMStrm.I!On and IM MC rate lhe MC raIe AJs bl d W N1. 8 m ITO 8 aher June 19/9 rd l'J from .ian ry thash Jane 1979 These rates are cet d m:cw ta< cnd arc < . poundM sono annuf!/

IatM Interest ci $15 0T1.000 m 1331. $h0AM 000 m 1980 rd SE 313 C00 m 1979 cens:sts of interest i h oneit tu o;mratmns b.huan on the St: dement of Re. ?ts cf Opsations! and M C rebted to honmed h:sds O! $li %0 00Q $12M/ Cal and SS 337 000 mpertne!y net of mccme tnes. w!nch ss i Nrq d to rnn ,truttan income Taxes Inwme taue conenny mwn ne compute:! L sed en pre-in mene ad,asted tar MC Lheezed deponub m and urher Marcons bruten pre tax mtc re md taub!e mco ne. Incon:e tu

.up, nw da a trum m ne f.nes cunent!; p vb!e due to transadmns wh ch affect ! ua not flf cOmi' d U! I,tv ib' ! irP.en'e UI d dterent i tcD@ tin {J perlodh Ibi- lax Cifects Of ce'thn of iia Se tU!;liej ddb re , t un: stent uth NO reifuatory ptJ ocs a.id Intern! Revenue Serace Requbt'ons. are d b tre t to hiture peneds and are teth': ted in the Biance Shtet as deferred t redt deh'rn d r Ergt s and nther an i if a,w atUd w n pmperty as a rtdocton to property and pLm' d insestment ta cn dit. nW.h rrdoces taxes currently paphic is dei erred and amort:/ed over the hm of the relaw pnmerti The Cowany a3a has unuwd irnestment tax credit of approdmatcly *

$ t3 no non whah w !! N ustj to the extent pernutted Li tax reWat;ons to rtduce future tax bab-5ty i

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$taggenest of Capetalisation The 04y1cm Power aM tot Compam

$ to t+ cnv4 At De :emhve 31 1981 1980 1979 Long-term Debt First mortgage bonds sees you aa 10%% 1981 - - 45,000 3%% 1982 - 15,000 15.000 3% 1984 15,000 15.000 15.000 14%% 1983 20,000 - -

14%% 1938 40,000 - -

17 % 1991 80,000 - -

1993 50,000 50,000 50,000

, 4 45 %

5%% 1997 40,000 40.000 40.000 6%% 1998 25,000 25,000 25.000 8 95 % 1993 20,000 20,000 20,000 8%% 1999 30,000 30.000 30,000 10% % 1993 45,000 45.000 30,000 9%% 2000 35,000 35.000 35.000 8%% 2001 45,000 45.000 45.000 8% 2003 40,000 40.000 40.000 9 % ".', 2003 50,000 50,000 50.000 10 70 % 2005 3,175 3,175 3,175 8%% 2006 50,000 50,000 50,000 6 35 % 2001 (Pollution Control) 14,200 14.200 14.200 8b % 2007 60,000 60.000 60.000 12% % 7009 63,620 63,620 57,000 725,995 600.995 624,375 Unamortized debt discount and prenuum (net) (1,044) (228) (176) 724,951 600,767 624,199 Guarantee of pollution control obbgations-7%% and 7%% Senes A due 1999 through 2009 35,279 29,995 26.390 10'a% 1980 Sene, duc 2000 6,700 6.651 -

Bank loan agreement -

20.000 -

10% mortgage note payable-due in instaliments through 2012 8,780 8,828 8.871 Capitat lease obhgations and ciber 4.040 5,500 7,943 Totallong term debt 779,750 671,741 667,403 Total Capitalization $ 1.563,028 $ 1,387.640 $ 1,301.020 Statement of Earnings ne tmion Power anaght company Reinvested in the Business I $ m Owmh Fome nes nM Dnemba n M 1980 1979 Earnings Reinvested in the Business Balaace at beginmng of year $ 125,572 S 122.907 $ 116,153 Net income - 93,990 64.771 61.536 219,562 187,678 177,689 Dividends-common stock . (54,869) (44.501) (40,485) preferred stock (19,235) (17.005) (14,297)

Balance at End of Year. $ 145.458 $ 125.572 $ 122.907 ne unwnen9 notes me an mtdTal put of the atue sntements

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Statement of Capitalization NDw %ea tvt awT 1 '" " i ,3 - ' t- r 1981 1980 1979 Common Shareholders' Equity Common stod

$1 par vioe. 50 000 00 s tres auth* zed. 31.400.6 t t 21,503.541 and 23 B35 462 cwes outstaning, respectwefy $ 219,804 $ 192,526 $ 165.848 Other p.nd in cepital 200,165 178,700 153,511 Earnimis re;nvested in the bus: ness 145,458 125.572 122.907 Total common shareht er .' eqwty . 565,427 436,798 443.266 Preferred Stocle -- Comu!atwc

$25 par value,4 0C0000 shares authoracd.

6 shares outeanJ ng 5100 par va!ue,4,000 m0 shares authorized Without mandatory re'h+mption prowsmns

% 3 't .: s r a s N 1 A- ! 15 S 93.280 9,328 9,328 1328 0 - 3 15"/ C1338 6,940 6.940 6.940 C - 3 90 ~.4 65.830 6,583 6.583 6 593 0 - 748 i, 150 000 15,000 15 000 15.000 L -7f/0% 200 000 20,000 20,000 20.000 1- 7375":s 250 000 25,000 25.000 25.000 luta! mthout mandatory redemption provisions 82,851 82,E51 82.851 W,th mandatory redemption prowsions (exc!asne of smk nq tund payment duc Wtihill Of.e yeaf }

. ,,s ,.,,,.:

G - 12 50 h 200.000,212.500 and 225.000 respectaveiy 20,000 21 250 22,500 H --- 8% 400 000 40,000 40,000 40.000 1 -9Y ; 450.000 45,000 45.000 45.000 J -- 1160". 300.000 30,000 30.000 -

Total wdh mandatory redemption prousens 135,000 136.250 107,500 I

1 1

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3 i r.e ' * > Fw , i. 3 r r r , m BalancJ Sheet 3- *

  • i 1981 1980 1979 Assets Property and Plant Iin tr.r u at m wce $ 1,206.009 $ 1032109 5 973 731 Gas p:mt in serm. 118,717 110.974 106.403 "tm pan' m vt 12.469 12205 11.902 Tat J paperty v:J w- ' m serv o: 1,337,195 1,155 353 1,012.039

) Less :c cumeted pr: , ' f at dt pc utmn and amm t vat mn 377.854 343 794 320.507 i t:u r cuou,:ated 6 ' mt mcca:e 'a.es r# :te ! to

heuecd Jepe 3 m .md mrtvatun 21,5G4 11 Eh7 9.189 N.:t pbnt in sen -: c 937,837 731.027 762343 Cur str o:: tion 6:4 .; prcures 717,276 f69.701 506.916 Net prv, r t y ;> d ;. Uni 1,655,113 1.450 128 1.269,259 Current Assets Cmh 4,659 7.703 5.462 Irrtporary ueA mvestmr-nts at rmt - 16 821

.b ounts recee,able. ! css prow , < ; for untnN :.td Y a n noots r;f 53.510, 53.333 and $2.457, res;u ts ety 62,922 54 429 47E66 f eel strek at merage ccst 50.635 fa255 M 653 Matcruis m sappi,es. at irserm:,e cost 18,086 16,223 11.596 Pr, pa,ments and attmr 31,411 28.609 20.206 Ictm c urrent auets 167,713 175,229 151 607 Deferred Charges and Other 59.806 53.087 59.912 Total Assets $ 1,882.632 S 1.f.% 044 S 1.480 808

'r n Capitalisation and Liabilities Capitahzation a. r 4 e

u- >

Con, m sturchouers' evtv $ 565,427 5 496.198 5 443.266 Pref.;rred siw k W>thout mandatory redm; tmn pros uns 82,851 82.851 82.851 Gth nnmtatory redenttiun prrr, Nns 135,000 136 250 107.500 t ong term debt 779,750 671.741 067A03 lut:d a;wtahzatien 1,563,028 1.387.640 1,301.020 Corrent Lab.htie:

Current portmn et t;tst : - algy bonds and preferred stock 15.431 46 250 1 250 Notes pm,ete 61,172 57.882 2.420 Accounts payabic 63.149 SU13 46251 Acuneet :oe 56.994 50 '58 47,187 Accrued mterest 18,200 1:A14 10.636 Gn upp: er ret ds due custan ers 8,485 7.510 11,223 0ther 17,993 13694 51780 icta; current lobstms 241,424 233.537 127.747 Deferred Credits and Other lornme toes re:ated to state and loca! taws and other items 21,428 20339 18.827 In.cstn cat tax cremt . 53,937 36.0S3 31,610 Other 2,815 2.385 1.631 Tota! daerred cicits and atber 78,180 58E67 52.041 Total Capitalization and liabihties $ 1,882.632 5 1.6ES 014 5 1.480 808 r m .r s n a i: m 7 r rt 1 -

  • l Sentengest el Searces el Fonds tt<e Davtw %et and tv#r Cce;,av lowested in Ceneenscteen Additions 1.n hwe for m,. m,ondH omw p 1981 1%0 1979 Internally Generated Funds Funds Retained in the Business Net mcomo 5 93,990 $ 64.771 $ 61.536 Add (deduct)

Deprecution and amortitaten 38,214 M 541 32.448 Deferred income taxes 27,338 11,430 9.486 Allowance for equ;ty funds used during construction (33,231) (27.M7) (24.908)

Funds provided trom cperations 126.311 82.795 78.562 Umdends on common and t. referred stock (74.104) (62.106) (54.782)

Funds tetsned m the busmess 52,207 20.689 23,780 Other Funds Provided (net)

Changes m working captal (excludmg short-turn debt and tempo,aty c.ub mvestments) . 37,932 (30.118) (2,351) f Other (1,583) 12.161) (4.451)

Other funds provided (net) 36,349 (32.279) (6.802)

Internavy generated funds 88.556 (11.590) 16.978 Funds Provided by Investors (not) Issuance of common stock 48,551 51.325 7,351 Issuance of preferred stork -

29.542 41.727 . J issuance of long term debt 144.507 58.693 135.450 ,

Heduction m long term debt and preiured stock (69.625) (6.071) (3.430)

Temporary cash mvastments (net) - 16,824 (8,038) l Short terni debt (net) 3,527 55.675 -

funds provided by mvestors (net) 127.060 205.988 176 060 Construction expenditures 215.616 1M.398 193.038 Ai!owance for equity funds used duong construction 33,231 27.M7 24.908 Totallnvested in construction Additions $ 248,847 $ 222 345 5 217.946 Percent of ConstructionExpenditures Generatedinternally 41.1 % (6 0)% 8.8%

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Statement of Results of Operations r: tu - w 4 t, t c;w ,

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4 1981 1980 1979 income Utikty Service Revenues f intr k $ 549.271 5 42062 $ 398 552 Cas 223.003 168 E 171.813 Enam 7,312 7.472 6 E61 Tata: etrhy servre ru , n 779,586 EM 000 S77.232 Other income A!:ou mre fu eq nty N c,e d dar, a oc<nnuction A cc 11 33,231 27317 24.908 Other en cme (n< t) (342) 857 1.333 T w memne 812,475 678 804 603.523 Expenses f oci used m erodxtw 205,514 111.573 163.958 Purc h .od po w s 4.592 13 2rA 16.874 Perch 1;ed qc; 177,306 149 206 135.269 npentinj and &nm'atem 88,749 70.712 63 603 M:entenance of rpp:nont .od fx t:es 43,533 46.131 36.116 Pnm , no for th ,act at ma, air i,rtmon and att.er 39,585 32.345 30.183 Genco! tee 3 61,849 48.604 45 035 Intere:,t charged to c; atons C, ate il 60,872 47.951 31.456 Tot:d eipens 682,000 593 794 528.541 Income Before Provision for income Taxes 130.475 79,010 74.979 In< ume t nes 36,485 14239 13.443 Net locome 93.990 64 711 61.536 Prtferred dvdends 19,235 17,605 14297 Earnings on Common Stock $ 74.755 5 47166 $ 41.233 Average Number of Common Shares Outstanding (000) 29.833 25,483 23.556 Earnings Per Share of Common Stock $ 2 51 $ 1 SS $ 2 01 Return on Shareholders' investment 13.9 % 10 1 % 10 8 %

a , ,

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Management Report on the Financial Statements Company management is respons:b!e for the accuracy and integrity of the financial statements included in this rep.;rt and has prepared them in accordance with generaMy accepted accounting pnncep!es An accounter 1 tystem is oced which mcorporates control techmques to ensure these financial statements prc jerly ref!ect the resuits of the transacticr.s of the Company, and provides reasonable assurance that ;he assets are safeguarded against any sigraficant loss. These control techniques are augmented *)y a r: marchensive internal audit program whth eva'uates these procedures and (

comphance with th.'rq The Board of Directors. throu<;h its Audit Revmw Comm:ttee, oversees the functioning of the <

accountmg system and the related contro!s. It a!so is responsible for ensuring that the mternal auditors are carrying out their duties with respect to adequate controls and to the performance of audits The internal auditors and the independent auditors have fun and free access to the Committee and meet with :t pencdicaMy The independent auditors Arthur Andersen & Co, express their opimon on the Company's financial statements This opinion is based upon their procedures which include mamtaining an understandmg of the Company's systems and procedures and performing tests and other auditmg procedures which they beheve are necessary Auditors' Report To the Sharehofders of The Dayton Power and Light Company:

We have examined the balance sheet and statement of capitahzation of THE DAYTON POWER AND llGHT COMPANY (an Ohio corporation) as of Deceniber 31.1981,1980 and 1979, and the re!ated statements of resuits of operations, earnings reinvested in the business and sources of funds invested m construction additions for each of the three years in the pened ended December 31,1981.

Our exammatrons were made in accordance with generaUy accepted auditing standards and, accordmgly. include 1 such tests of the accounting records and such other auditing procedures as we considered necessary in the orcumstances In our opimon, the financial statements referred to above present fairly the financial position of The Dayton Power and Light Company as of December 31,1931,1980 and 1979, and the results of its operations and its sources of funds insested in construction additions for the years then ended. in conformity with generany accepted accountmg pnnciples applied on a consistent basis.

ARTHUR ANDERSEN & C0 Dayton. Oh!o.

January 26.1982-(

I 1

About This Book About our cover photo, This year's annual report has been Dayton Power and Light is a 99 percent designed to provide shareholders and coal-burning utikty, and receives its others interested in The Dayton Power supphes by barge on the Ohio River. Our and Light Company with an overview of close proximity to some of the best low our performance The management sec-sulfur coal supphes in the world puts us tion of this book, beginn:ng on the oppo-in a favorah!e position to meet customers' site page, also provides a letter to share-growing energy needs. holders, a review of the Company's opera-tions and the Financial Review.

Under this flap, we hdve enclosed the au-i dited financial statements and footnotes, as required by the Secunties and Ex-change Commission and the Financial Accounting Standards Board, for readers seeking such detailed information.

T:ble of Contents Corporate Profile Perfurmance Highlights 1 The Dayton Power and Light Company To Our Shareholders 2 provides electncity and natural gas to residential, commercial, industrial and The Year in Review 4 governmental customers in a 6,00Gsquare Results of Operations-Charts 8 mile area of West Central Ohio. The Com-fmancial Review 9 pany employs over 3900 people. Electricity Directors and Officers 11 for DP&L's 24-county service area is gen-erated at seven pcwer plants and is dis-Investor and Secunties Information 12 inbuted to 419,000 retail customers. On a L

wholesale basis, electric energy is financial Statements Nnder thss flap) supplied to 15 municipahties. Natural gas service is provided to 264,000 customers

in 16 counties. The Company provides steam service to 388 customers in

- downtown Dayton for heating and indus-P tnal processing. The corporate offices of DP&L are located at:

Courthouse Plaza Southwest, I Dayton, Ohio 4M01 (513) 224-6000.

g _._

l1 Performence Highlights Percent 1981 1980 Change Financial Performance:

Return on shareholders' mvestment -

Earned a 13 9 10 1 38 Allowed by the Pubhc Uhttres Comm:ssion of Ohio  % 16 0 14 6 10 Return on total capital  % 11.1 91 22 landngs per share of common stock $ 2.51 1 85 36 Taxes per share $ 3.30 2 47 34 Dnndends paid per share $ 1.82 1 74 5 Dnndend payout ratio  % 73.4 M3 (22)

Book value per share $ 18 01 18 06 -

Market value per share $ 14Y. 11 % 23 Capital investment Performance:

Construction additions (000) $ 248,847 222,345 12 Construction expend tures pant from internal funds N 41.1 (6 0) -

Plant under construction at year end -

Investment (000) $ 717,276 659.701 9 lovestment not ira.luded in rate base -

Amount (0W) $ 579.230 536.103 8 -:

As a percent of net plant in servo  % 61.8 67.8 (9)

Operating Performance:

Electoc -

Company operated generating units Avadabic for maamum production -

Company  % 82 72 14 lodustry averayo  % 72 71 1 Savmgs to the Companj (000) $ 15,000 8.000 88 fuel consumed (BTU) per kdowatt hour generated 10,270 10.410 (1)

Coal cost per nn! hon BTU $ 1.843 1 675 10 Cost per kilowatt hour -

f uel cost c 1.954 1878 4 Production operatino and muntenance cost c .346 371 (7) tmergency purchased power n0m $ 523 2,944 (82)

System peak to id ~ megawatt:, 2,219* 2,045 9 Reserve margin at tune of peak  % 21.7* 22 0 (1)

Gas-System peak day load- mdhon cubic feet 543* 452 20 Purchased gas ex;,ense per thousand cubic feet . $ 3.08 2.53 22

' January 1982 m-. - -

In 1981 our 3,900 employees improved generating prod-uctivity to 82%, saved $15 million in operating ex-penses and increased share-holders' return 38%.

To Our Shareholders:

' ')

I e

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3 during some of the most adverse times of rising interest rates and fmancing costs. However, with the completion of the Killen coal-fired generatmg unit in 1982 arid the During the year your Board and Zimmer nut!eir generating unit in management lost the services of and is also below the 16% the Pub- 19?>3, the Conwny's construction Mr. Robert G. Chollar, Chairman of hc Utilities Commission of Ohm program wdl rapidly decline and by the Charles F. Kettering Founda-conchsded the Company should the mid-1980s probably will be fi- tion, who died in November. Mr.

earn Your management is dedi- nanced almost entirely with cash Chollar spent eleven years on the cated to work toward a further un- generated mternally. Board and his highly respected ad-provement in your return so that it vice and counsel will be missed.

wdl be at a level commensurate Our plans for electric and natural with alternative investments. gas supplies in the 1980s provide The 1981 performance accom-for a slower economic growth rate p!ishments were due mainly to the We believe that the greatest for our service area than experi- efforts of the entire group of 3.900 ach evement m 1981 was the im- coced in the past. However, we management, professional and bar-proved productivity of the generat- are confident that there will be gaining unit employees working ing units operated by the Com- sufficient energy in our service together as a team, dedicated to pany. Our generating units were mea for the people at home and excellence.

available for maximum prcductivity work.

throughout the year at a level of Credit for improved performance 82% compared with the national Our strategic planning to meet fu- can be given to the Company's average for all utilities of 72"4. ture shareholder and customer management process which in-This level of productivity saved the interests naturally has included cludes Board of Directors' govern-Company $15 mdhon m operating planmng for management succes- ance, planning and objective set-expenses and permitted the sale sion. Your Board must continue to ting, decision making, information of $6 nulhon of electricity to other be assured that the Company is in systems and employee oppor-utihties. Ihrough the regulatory the hands of capable management. tunities. This process is sum-process these dollar gains are in January the Company an- marized in a pamphlet that you can shared by our shareholders and nounced plans for several man- obtain by completing the postcard our customers In addition, this agement changes Followmg the in the back of this report. We improved level of operation will April 8,1982 Annual Shareholders' would also be happy to receive any permit us to lower our generating Meeting. Mr. Robert B. Killen will comments, questions or sugges-reserve margin in the future and step down as Chainnan of the tions you have and will answer all save over $100 million of capitalin- Board but continue to serve as a postcards received vestment. We are especially Board member. Mr. Robert E.

pleased that this level of perform- Frazer will become Chairman of the ance over the years enabled us to Board and Chief Executive Officer gggg , , _

reduce purchased power costs and Mr. Peter H. Forster wdl be-from $33 million in 1978 to S4 6 mil- come President and Chief Operat-lion in 1981, of which only $500,000 ing Officer. Robert B. Killen was for emergency purchases to Chairman of the Board meet system requirements.

Durmg the past ten years, we have been building new electnc g g generating capacity to meet the Robert E. Frazer growing energy needs of consum- President and Chief Executive Officer ers and industry. The necessary capital expenditures were incurred January 28,1982

4I During 1981, the people of DP&L continued implement-ing programs designed to achieve a level of excellence and quality in the way we serve our customers. This ob-jective extended to areas of service, reliability and productivity.

The Year in Review Plant Productivity F'

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5 Construction The year 1981 marked the peak year for construction expenditures.

The East Bend plant. jointly owned with The Cincinnati Gas & Electric Company, went into commercial operation last March. The Killen generating station will be com-pleted in October of 1982. Our goal is to make Killen one of the best operating stations in the world.

This will ensure reliable and cost-effective electric service to our customers well beyond the year 2000 while providing a solid base for future shareholder earnings.

We introduced the personnel at A major part of our energy produc-this plant to some of the newest tion program is the completion of available training programs de- the Zimmer nuclear station. Zim-signed to help them solve prob- mer has been essentially complete lems at the root-cause level. They since 1979. It now represents to are also taught to identify potential the participating companies an in-problems and to implement correc- vestment in excess of one billion tive action in order to prevent dollars. "

costly disruptions in operations.

We are doing everything we can Despite the negative economic to make all of the modifications chmate throughout most of the demanded by the regulators in country and West Central Ohio in Washington to put the plant in op-1981, our customers did use an all eration. When operating, Zimmer time record amount of electricity will produce economical nuclear on July 13, 1981. On that peak day, power for more than four million not only were we able to meet all people served by the three owner of their needs with existing companies at a fuel cost of one-generating equipment but we also fourth the cost of coaLWe now sold electricity to neighboring expect to load fuelin 1982, and companies which did not have begin commercial operation in ennugh generation at that time. 1983.

Plant productivity is important at With the completion of Killen and DP&L in another way. We are al- Zimmer,it is management's objec-most exclusively a coal-burning tive to generate funds for future electric generating utility company construction projects from sources located adjacent to some of the of internal cash. We hope to best low sulfur coal supplies in the achieve this goal by the mid-1980s.

remld. This puts us in a favorable position to meet our customers' De:,pite the general de-emphasis ccergy needs at the lowest in regulation at the Federal level, possible cost not only now but in the regulatory challenges for our the future. company will remain significant.

6k Customer service j, y: .

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With our increasing productivity and completion of the new electric generating units, we will not have to invest in large and costly elec-tric generating plants as in the past. We feel comfortable with the natural gas supply for all of our customers for the next decade.

West Central Ohio will continue to UDs Z[j have adequate energy provided by mut *>, tw<> ,n se ey DP&L in a reliable manner.

nesuch teg, on tne feasum of OP&L looks forward to 1982 with eenmoew s ca<s

'* ~gp'"*'t'3 the knowledge that we have dedi-cated and trained people, energy and the needed facilities to serve, on a personal basis, all of our cus- - - . _g

+ tomers in the 392 communities  ?

^

~

that make up West Central Ohio.

It is our objective to continue our 70 year tradition of providing reli-able services anu remaining a good Economic Climate neighbor to our customers.

We see the electric load growth in West Centraf Ohio continuing at a lower level when compared to the late 1960s and the early 1970s. This is a result of commercial and industrial customers using energy more efficiently to produce the w mustmut m w s~ r m m same amount of goods and serv- V"*"***"'"**"*"

fxot es v.at umt,nue to <mpwe the ices, residential customers insulat- tang term m. of ama emp:oywnt ing and making their homes more energy efficient, and the fact that this region's economy is now grow- r ing at a lower rate. We believe however, that the current em- -

ploymant opportunities in both the urban and agricultural-rural areas 7',/ ~

will be sustained.

,f";

2 New investments in our area, such as the one billion dollar General #

~- "

Motors Chevratet truck and diesel angine manufacturing pbnts, com-bined with additions such as the

(

new Emery Air freight facility, will ,

improve the quality of the long- .

~

term mix of area employment.

8l R:sults of Op;rati:ns-Ch:rts i '

l l

Electric Sales ' %.. l Purchased and Generated Power f V ,Vi l

! 4 Gas Sales '

1 C'. 's. E .' ' 5" .i a- E ec' Of i/' '.i er  : r ". 5" ' ,P.> >

j 81 10 81 56 81 11 i

1 80 10 80 58 80 11 l )

T 79 10 79 i, 63 79 11

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) Electric Revenues 5> >

Gas Revenues $ Purchased Power $- t 1 I O~ <

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} n; , a: s v 81 549 81 223 81 M 4 6 80 454 80 188 80 M 13 i

79 399 79 172 79 17 78 33 Coal Consumed Purchased Gas r Ope.. ..ng. Administrative and Maintenance i < r a a t. < +c ,.!Er ,e a! < P. , s r ai. ' i. ,, e > . s . .n r, ' mc 81 50 81 58 81 132 80 46 80 59 80 .

117 79 47 79 64 79 100 Coal Consumed $ Purchased Gas t- Earnir:gs on Common Stock i 81 199 81 177 81 75

$40/tm $3 08/MCF 80 175 80 149 80 47

$E/ ton $151/MCf 79 151 79 135 79 47

$11/ tan $717/MCF

9 Financial Review Financial Condition The Company's financial condition improved in 1981 as earnings in-creased, return on shareholders' investment rose to 13.9%, internal funds for construction expendi-tures jumped to 41% (from a nega-tive 6% in 1980), and earnings coverage for interest and other fixed charges improved to 2.7 times. Continued improvement in the Company's financial condition depends in large part upon receiv-ing adequate and timely rate in-creases as new higher-cost generating units are placed in service and as inflation increases cash generation will provide nearly operating expenses and interest all the funds for construction ex-rates penditures anticipated for the mid-to late-1980s. These improvements Construction additions amounted in the Company's financial condi-to S249 million in 1981, the h;ghest tion should benefit shareholders as ever experienced by the Company. well as customers through re-The Company currently estimates duced borrowing needs and lower that construction additions will be capital costs.

reduced to S225 million in 19d2, and further decline thereafter to the To provide financing alternatives levet of about S150-200 million an- and flexibility, the Company has nually through 1986. After rate revolving bank loan agreements increases are obtained to recover which can provide up to S200 the higher investment and financ- million of available cash.

ing costs of the Killen and Zimmer Borrowings under these agree-generating stations scheduled for ments can be converted to term operation in 1982 and 1983, respec- loans which mature from 1984 tively, it is anticipated that internal to 1988. In addition, the Company has $96 million of bank lines of credit which are used to support the issuance of commercial paper.

Results of Operations The charts on the preceding page show variances in sales, revenues, expenses and earnings.

Revenues from utility service have increased annually due principally to rate increases and the recovery of higher coal and purchased gas costs.

Recent electric and gas rate in-creases granted are summarized in the table below.

Date Amount Amount Percent 5 in muons f ffective Requested Granted increase Electric Retail- $103 Interim 12/80 $48 12 Additional 7/81 $34 7 Wholesale 6/81 S 6 $5 34 Gas 10/81 S 14 S11 5 A decision on a pending $76 mil- A decision on a pending request lion (14%) retail electric rate in- for a $3 million steam rate increase crease request is expected in early is expected in the first quarter February. This increase is designed of 1982.

to recover a portion of the financ-ing costs of new generating plants Several categories of expense,in-and is tied to the completion of cluding operating, depreciation and the East Bend station that began interest charged to operations, in-operation in March. A $16 million creased during the year as a result (2%) retail electric rate increase of the East Bend generating plant requnst is also pending, and a de- being placed in service in March cision is expected in the fall of 1981. The Company's general taxes 1982 when the Killen generating increased 27% due to an increase station will begin to operate and in the Ohio Gross Receipts Tax. For to incur operating costs. accounting purposes the Company expensed, under the depreciation category, $3 million of losses from the cancellation of the second unit of the Killen generating station.

Other expense items rose princi-pally due to the impacts of inflation.

11 Directors eed Officsrs Directors 0#,cers

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12 nn.mn e s w n.wi Communications Common and Preferred Stock The Company staffs e ,nywtor Relations Department at its corporate headquarters Transfer Agents to meet the information needs of share- Citibank, N.A., Corporate Trust Depart-holders and investors. Inquiries are wel- ment,111 Wall Street, New York, New York come by telephone, letter or postcard. 10015 Communications relating to shareholder Also New York registrar accounts should be directed to the inves- Winters National Bank and Trust Co., Cor-tor Relations Department. porate Trust Department, Winters Bank Tower Dayton, Ohio 45401 Automatic Dividend Reinvestment and Also dividend paying agent Stock Purchase Plan The Company provides this plan for hol- Registrar ders of record of Common and Preferred The Central Trust Company, N.A., Corpo-Stock to reinvest dividends in the Com- rate Trust Department, Central Trust Cen-pany's Common Stock without payment of ter, Cincinnati, Ohio 45202 any brokerage commission or service charge. Shareholders may make optional cash contributions from $25 to $1,000 in First Mortgage Bonds any quarter. Direct inquines to the inves-tor Relations Department. Trustee Irving Trust Company, Corporate Trust De-Winters National Bank and Trust Co . Cor- partment. One Wall Street, New York, porate Trust Department, Wmters Bank New York 10015 Tower, Dayton, Ohio 45401 serves as the Also interest paying agent shareholders' agent for this plan.

Co-Paying Agent Morgan Guaranty Trust Company of New Annual Meeting York, Corporate Trust Department,23 Wall The Annual Meeting of Shareholders will Street, New York, New York 10015 be held at 10 a.m Thursday, April 8,1982, at Memorial Hall,125 East Fust Street, Dayton, Ohio. Form 10-K Report The Company reports details concerning its operations and other matters annually Stocks end Bonds to the Securities and Exchange Commis-The New York Stock Exchange is the only sion on Form 10 K, which will be supplied national secunties exchange on which any upon request. Please direct inquiries to of The Dayton Power and Ught Company's the Investor Relations Department.

First Mortgage Bonds and Preferred and Common Stocks are hsted. The trading symbol of the Company's Common Stock is DPL Federal Income Tax Status of Common and Preferred Stock Dividends Paid in 1981 The Company estimates 12.4% cf the total' common stock dividends paid in 1981 is non-taxabic to shareholders and is a re-turn of capital for Federalincome tax pur-poses.

Dividends paid in 1981 on preferred stock are fully taxable as dividend income.

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( (PleaSe do n0t Staple.)

We w: id appreciate knowing any comments, sugg:stions or '

questions you may have:

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snw _ z,p O Please send me a copy of the Company's Management Process brochure. j O Please send me detailed financial and oprirating statistics.  :

O Please discontinue sending a copy of the annual report to the account listed above because a duplicate mailing already comes to that address. .

NO POSTAGE NECESSARY IF MAILED IN THE UNITED STATES BUSINESS REPLY MAIL FIRST CLASS PERMIT NO 26 DAYTON. OHIO POSTAGE WILL BE PAID BY ADDRESSEE The Dayton Power and Light Company ,

investor Relations Department Courthouse Plaza Southwest Dayton, Ohio 45401 i F

m 6 J L

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