ML20108F429
| ML20108F429 | |
| Person / Time | |
|---|---|
| Site: | Millstone, Seabrook, 05000000 |
| Issue date: | 12/31/1983 |
| From: | Eichorn J EASTERN UTILITIES ASSOCIATES |
| To: | |
| Shared Package | |
| ML17054D536 | List: |
| References | |
| NUDOCS 8412200464 | |
| Download: ML20108F429 (50) | |
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1983 1982 % Change Financial Dana (dollars in thousands)
Operating Revenues S 302,450 $ 288,417 + 4.9 OperatingIncome 36,537 31,296 + 16.7 Consolidated Net Income 25,364 16,941 + 49.7 Net Utilitv Plant 498,264 413,260 + 20.6 Cash Construction Expenditures 78,912 61,236 + 2 8.9 Internally Generated Funds 27,258 12,658 + 115.3 Return on Average Common Equity 16.2 % 13.5 % + 20.0 t'- Share Deen Earnings per Average Common Share $2.80 $2.25 + 24.4 i
Dividends Paid per Share St.79 $1.70 + 5.3 i Average Common Shares Outstanding 9,862,810 7,519,381 + 20.5 Book Value per Share (Year End) $16.91 $16.04 + 5.4 Operasing Data Total Electric Sales (mwh) 4,201,000 4,049,000 + 3.7 System Peak Demand (mw) 700 680 + 2.9 Reserve Margin (At Peak) 22.3 % 26.0 % - 14.2 System Load Factor 64.8 % 59.8 % + 1.7 Customers (Yw End) 232.515 230,094 + 1.1 Employees (Year End) 1,026 965 + 6.3 s EUA System ProWe astern Utilities As- Blackstone Valley Electric Eastern Utilities Associates sociates is a public Company operating in north- also owns EUA Service utility holding com- ern Rhode Island. Montaup Corporation. EUA Service pany with three electric oper- Electric Company supplies provides, at cost, various ating subsidiaries which are electricity at wholesale to accounting, financial, pnncipa!!y engaged in the Eastern Edison (its parent), engineering, planning, data generation, purchase, trans- Blackstone and three unaffili- processing and other services mission, distribution and ated utilities for resale. for the Association and its sale of electric energy to Electric operations accounted Subsidiaries. Together the
\ 233,000 customers covering for 100% of operating companies are known as the an area of about 540 square revenues. Approximately EUA System.
miles. Our retail electric 156,000 of our customers are companies are Eastern Edison in Massachusetts and 77,000 i Company operatingin south- are in Rhode Island. About i eastern Massachusetts and 75% of totalconsolidated l operating revenues are regu-l lated by the Federal Energy Regulatory Commission.
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EUNs one million common FERC's latest Construction I am pleased to report that To Our Shareholders: 1983 was a year of con- share offering and $6 million Work in Progress ruling of new equity was added by allowing utilities to earn a cash tinued Anancial growth for our Employee Savings Plan return on a portion of new Eastern Utilities Associates. generating f acilities under con-Kilowatthour sales advanced and our Dividend Reinvest-struction, and its allowance of across the board, the company r ent and Common Share a forwardlooking test year for achieved record earnings, your Purchase Plan.
dividend was increased, and These funds were used to determining rates. Montaup Anance our construction Electric, our wholesale gener-the System's overall Anancial position strengthened. I am program, necessary to provide ating subsidiary,is wholly our existing and future cus- under FERC jurisdiction.
con 6 dent that this trend will FERC has also granted Mon-continue. tomers with reliable energy Earnings per share jumped at reasonable costs. We antici- taup a temporary Oil Conser-pate our cash construction varion Adjustment rate to from $2.25 in 1982 to $2.80 Snance the oil-to coal conver-in 1983;for the second expenditures will decrease sion at its Somerset, Massa-consecutive year the quarterly annually from the 1983 peak dividend was raised, from 42.5 of $78.9 million, chusetts generating station. As Current plans for 1984 a result of this responsive cents per share to 45.5 cents per share; and, as in 1982, se external 6nancinginclude the regulation at the Federallevel, we expect to generate almost half of our cash construc-
"I am heartened by Wie progressive actions of the tion needsinternally during Federal Energy Regulatory Commission (FERC) 1984, which regulates approximately 75 percent of our debglan ) of our re enge System's revenues, Responsible FERC rulings at,th,e state level. Of $38 milhon of new revenue sought have been instrumental in restoring the System's in Rhode Island and Massachusetts since 1982,our SnenciehlebHMyin recent yearSy retail subsidianes, Blackstone
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ended the year with no short- sale d one $6 million tax- "
term bank debt. exempt bond issue in ,'re I n ss This solid performance is a Massachusetts and another $6 well as additional rate 6 lings result primarily of responsive million tax-exempt bond issue in both states, therefore, must Federal rate regulation in Rhode Island. In addition, and will continue accompanied by a healthier $7 million is expected to come Our oil-to-coal conversion national economy and a more from wr Dividend Remvest- program at Somerset Station advantageous securities ment and Common Share continued in 1983. The 6rst market. Purchase Plan. Due to the electrostatic precipitator Ourimproved Snancial foregoing Snancing and should be instatied by May health has been recognized by expected increased internally 1984, almost one year ahead the three major credit agencies, generated cash, short-term of schedule. With the burning Moody's Investors Service, bank borrowings for 1984 d coal for part d last year, Standard & Poor's Corpora- should be minimal.. our generation mit trom 1982 tion, and Duff and Phelps, all Our ability to raise neces- to 1983 changed dramatically:
, of whom raised their credit sary capital at reasonable costs oP use dropped from 77.8 i quality ratmgs on securities hinges on adequate, timely percent to 59.9 percent:
l issued by Eastern Edison rate relief. Otherwise, ou' nuclearincreased from 22.2 Company, our Massachusetts companies mightbe unable to percent to 23.8 percent; and retail subsidiary. meetlegalcoverage tests coal, not in our mix in 1982, Improved Snancial market needed for the issuance of stood at 16.3 percent of our conditions enabled us to effect securities. total generation at year-end
$102 uillion of permanent I am heartened by the 1983. Low-cost hvdroelec-Snancing. Eastern Edtson progressive actions of the tricity from Hydr 50uebec, Company sold $40 million of FederalEnegy Regulatory Canada willfurther reduce our First Mortgage Bonds and $40 Commission (FERC), which dependence on more costly oil.
million of tax-exempt pollu- regulates approximately 75 tioncontrolsecurities, About percent of our System's
$16 milion was realized by revenues. Responsible FERC rulings have been instrumental in rotoring the System's tmancial viability in receat years. Exemples include 2
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'Dirough our membership in increased use of coal. more support measures aimed at the New England Power Pool hydroelectric power and the inducing productisity in the (NEPOOL). we hold a 3.77 addition of new nuclear units private sector in order to percent interest in a power are promismg developmenn maintain the healthy interchange agreement for our future fuel mix. momentum gained this year between NEPOOL and Meanw hile. an improved Hydro-Ouebec. Phase 1 of the economic climate. both Ven trulv yours, project will brmg 690 mw of nationally and regionaliy.
electric energy into New coupled with near record n
, IM=
l England commencing in 1986 summer and winter tempera.
Since March 1983, negotia. tures, boosted electncity sales.
tions between NFPOOL and This reverses the negative sales John F G Eichorn. Jr (
Hydro-Quebec have been trends of 1980 1982 and gises President i underway to increase the cause for optimism for the l
interconnection capability to future it is our hope that 2.000 mw by the early 1990's leadership at both the Federal and local levels - government, labor and business - will l
l 3
I
Review of Operations arninas HIcher; m bitterly cold temperatures were DividendIncreased responsible for the increased Arain -Driven by use of electricity used to op-much-needed rate relief and erste central heating systems M
an increase in kilowatthour and auxiliary electric heaters.
sales, Consolidated Net Economic and financial Income surged 50% to $25.4 indicators showed positive million.His was an increase " signs ofimprovementin the of $8.5 million over 1982's nationaland regional econ-316.9 million. He improvo- omy. He residential customer ment in Consolidated Net 4 base grew by 1% while com-Income also raised the mercial firms increased 2%.
System's earned return on average common equity to o so n az m3 34 IndustrialSales Trend 16.2%. The effect of 1.5 Return on Averego Conunon Upwards million additional common squay: Sales of electricity to the shares limited the growth in our return on common e<luity industrial sector trended earnings per average common has continueny knproved upwards for the first time in a share to 24.4%. Earnings einee 1979 ofthough we still number of years. Indications have not earned the returns ofimproved t2siness allowed by our verlous regu- conditions surfaced late in lotory commiselone. the second quarter. This moment *1m continued to build through the third and esidena taland fourth quarters providing 3
CommercialSales optimism that improved facrease - Sales of business and employment electricity to resHential and opportunities will continue 2 commercial customers during throughout 1984.
1983 increased 5.5% over the prior year.This was due to esponsive Federal I record-breaking weather and Wholesale Rate improved economic condi- Relief Continues tions. Sales tocommercial ne continuation of responsive o 19 so si es s3 customers also increased due regulation on the part of the to a new Massachusetts state Federal Energy Regulatory Earninge and N- law allowing major chain Commission (FERC) is E Earnings stores and other retail enter- significant. It is the single E Dividende prises to conduct business on most important external Earn.nge for 1963 reached on Sundays. factor responsible for your all time high while dividende Consumption during the System's dramatic upturn in continued the growth ponern third and fourth quarters of financial health. FERC regu-begu in .
1983 climbed sharply. Resi- lates approximately 75% of e
g g dential and commercial cus- System revenues. It too,k fur-tomers,in particular, relied ther progressive steps, m June heavily on air-conditioning 1983, by issuing a final rule-per average common share systems to counteract extrem- making permitting the were $2.80, $0.55 over 1982. ely hot weather conditions. inclusion of a portion of Our stated goal of provid-I",8jijgi"Q'h ,,
" Consolidated Not income surged 50% to $25.4 met.ne quarterly dividend million.We met our stated goal of providing rate wasincreased from 42.5g per share to 45.5g per dividend increases at regular intervals by increas-8' Ing our annual dividend for the second
$',y*9g'3 $*,thd is ,
was the second consecutive consecutive year."
yearin which our dividend was increased. National and local weather Construction Work in Progress A detailed d.iscussion of organizations reported that (CWIP) in rate base for rate-rate case activityis provided 1983 summer temperatures making purposes. In addition later in this report. In established all time highs, to CWIP in rate base, addition, a review of Sales, snapping decade-old records. FERC allows the use of a I Revenues and Expenses is Toward the end of 1983, forward looking test year for included in " Management's ratemaking. Also,in 1983 Discussion and Analysts of it granted Montaup Electric Financial Condition and Company a temporary Results of Operations" on OilConservation Adjustment page 20. (OCA) rate. Montaup is the System's generation and transmission subsidiary. Each of these progressive con-4
cepts is discussed in the fol. implemented, included in increase to approximately lowing paragraphs. Details rate base approximately $44 $19.2 million in 1984. He of rate relief granted at the million of pollution control OCA collection is expected to Federallevel over the last two and coal conversion CWIP end in 1986 when the coal years are shown in the and approximately $59 conversion has been fully paid accompanying table.
Under the CWIP rule- emsponsive Federal Energy Regulatory Com-making, all companies under FERC's jurisdiction willbe mission regulation is the single most important Mdth ir $ ion external factor responsible for your System's Work In Progressin rate base, dramatic upturn in financ'al health."
thereby earning a cash return on the portion included.He finalrule also places other million of CWIP associated for. After that all fuel cost limits on the amount of with generating facilities savings willbe passed on to includable CWIP in rate base under construction.- eustomers.
during the Erst two years of In hfarch,1983, a new Oil By a!!owing a forward implementation. Conservation Adjustment looking test period for rate-making purposes FERC provides companies under its jurisdiction the opportunity to anticipate the impact of inflation. It then sets rate levels designed both to match m renc prospective costs and to allow a utility to earn an adequate return on equity.
In recognition of hion-taup's need for prompt rate eULL relief, FERC has allowed each of the rate increases shown in the table below to Rate Regulation by Responelve rate regulation at become effective approxi-Jurisdiction Year End 1983: the Federallevel continues to mately siuy days after the About 75% of the System's have en enormous impact on request was made. Ilawever, consolidated revenues are the system's Improving the increases granted are still regulated by FERC. Anancial health and etabiRty.
subject to refund.
This new rule provides clause was implemented. Rate Relief or State Level Montaup and ultimately the De OCA clause allows Remains Inadequate System with the opportunity hfontaup to retain a portion As shown in the tab!c below, to substantially improve the of the fuel cost savings the rate relief granted our cash component of its realized from burning coal retail companies in hfassa-earnings. By including CWIP rather than oil to fund chusetts and Rhode Island in rate base and earning a the cost of convertingits continues to be inadequate.
cash retur 1, the System will be Somerset Generating Sta- State regulation in both able to reduceits external tion.ne remaining fuel cost states is governed by a policy 6nancing needs and thereby savings are, after provision of using outdated costs for lower the overall cost of the for taxes, pssed on to cus- regulation. In periods of rising major generation projects tomers. During 1983, the costs,it is difBcult under this under construction. His will OCA provided hfontaup approach to generate sufBeient l
result in lower construction with $10.3 million of cash and revenues to cover constantly costs which will ultimately it is anticipated that this wi3 increasing costs.
be reflected in rates. However, l Federallegislation has been
! proposed that could change Table of Receri Rate Relief Granted the benefits of this FERC Annual Revenue (000 m)
Effective Retum on rulemaking. Juriutiction Requcned Granted Date Equity benefi the le- Federal IFERC) $ 4,165 $ 4,165 4/21/82 18.0cc making, hfontaup filed and Federal (FERC) 18.053 16,767 1/09/83 18. Orc l was granted an additional Federal (FERC) 17,400 15,000 12/28/83 16.2cc rate increase in December. Rhode Island 5,709 3,236 5/20/82 15.50 %
1983. The rate increase as Rhode Island 5,900 1.770 II/10<83 15.20cc hfassachusetts 9,572 4,353 3/03/82 15.25 fc j hfassachusetts 10,778 4,503 11/09/82 lMWi hfassachusetts 6.200 109 1/31/84 15.25 %
1 5 l
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% redit Reiegs !!p- shareholders and ratepayers to ne Rhode Island Public graded;iher $100 maintain credit ratings in Utilities Commision granted Blackstone Valley Afillion of New the middle range of the im est-Electric Company, the Sys- Capital Raised-In hiay, ment grade category. We uill tem's Rhode Island retail 1983, two major credit rating continue to work toward l
subsidiary, a $1.7 million agencies raised the credit accomplishing this goal.
)
rate increase in October, quality ratings on the perma- The improved ratings, 1983.His was only 27% of nent securities of Eastern combined with improved
- the amount requested.The Edison Company. The rating market conditions, enabled t
order authorized Blackstone agencie specifically cited the Eastern Edison to sell $40 m return on common equity benef4ial effects of FERCs million of 30-year mortgage of 15.2%. llowever, by regulatory practices on the bonds in hiay. The interest rate was 12% % . This is the i
"The $102 million of financing completed this first time since 1973 that
! Eastern Edison has raised year has enabled the System to end the year with 30-year money. The 12% %
I no short-term bank debt for the secon'd con- $',g'y',*7,,IS , , 'h*
g,, I ',",
ed *by l
' secutive year." Eastern Edison since 1975.
Eastern Edison also entered financial health of Eastern's the ta,x-ex,empt market for the neglecting to fully recognize first time m August. Eastern the increased cost of serving subsidiary, hiontaup Electric issued $40 million of 1044, customers, the Comniission's Company hfoody'sInvestors Service raised its rating from 25-year tax-exempt securities decision provides no oppor- through the Massachusetts tunity for Blackstone to earn Baa 3 to Baa 2. Standard & IndustrialFinance Agency.
even this inadequate rate of Poor's Corporation raised its De proceeds from 'his return. In addition, the rating from BBB- to BBB. financing will pay for de October order disallowed The third major rating agency, installation of certain pollution certain charges for EUA Duff and Phelps, assigned a control facilities at Mor-taup Service Corporation. Black- rating of 9 to Eastern's securi- Electric Company's Somarset stcwie has appealed to the ties. The rating of 9 is com-Station. The polletion control i
Rhode Island Supreme Court parabic to the Baa 2 and BBB facilities are required in order forrelief of thisportion of the rating of the other agencies.
l to convert the station from order.The inadequacy of the We are pleased with the im-l Rhode Island Fablic Utilities proved credit ratings. The *'I '8 ' 'I .buming.
Approximately $21 million Commission decision 'nay revised ratings are stillin the d the proceeds from this force Blackstone to file an- lower range of the investment tax-exempt financing were other rate increase request grade category. We believe it is utilized in 1983.The in 1984. in the best interests of our Unsatisfactory prior rate decisions required Eastern Edison to file with the Massa-chusetts Department of Public Utilities (DPU) for higher rates in 1983. Eastern Edison is the System's J, Massachusetts retail sub-sidiary.
On January 31,1984, the DPU denied Eastern Edison's request for a $6.2 million increase and ordered a rate reduction of approximately
$0 6 million. In its order, the DPU disallowed Eastern's request for capital attrition and for anticipated increased operating and maintenance expenses. The DPU reduced Eastern's return on common equity from the 16% t previously allowed to 15.25 % .
Eastern petitioned for recalculation to correct ,,3 ,,,, ,,,, ,,, i,,3 mathematical errors in the For the second year in a row DPU order. He final result Capitelization Rolloes a short Term Debt the EUA system onded the was a rate increase of year with no short-term debt. ,
g109,000, a Long-Term Debt 3 Preferred Equity our long. term debt retings i e Common Equity were upgraded in 1H3 by the 3 TotalCapiteII:stion three major rating agencies.
la mmione 6
s .
I saw um onstruction Spending Peaks -The System's construction expendi-tures in 1983 totaled $103.3 million. About $82.5 million, se or 80% of this total, was for generation-related projects, including approximately $54.4 million for the Seabrook and Millstone nuclear units, and e6 about $27 0 million for the conversicm of hiontaup's Somerset Station from oil to coal burning. He remaining
$20.8 million was spent on up-grading and improving our transmission and distribution system, as well as other gen-eral projects.
22 Imoking ahead, the Sys-tem's construction program for the next Sve years calls for expenditures of about
$298.3 million, including o n u 75 a n 7: M ai si s2 s3 $101.5 million for 1984. ,
The 1984 estimated expendi-Construction Expenditures struction expendHures WN1 tures are less than experi-EUA system construction decline somewhat in 1984 and enced in 1983 and we expect expenditures peaked in 1983. ehould continue to decline construction spending to H h eW that con- k eewelyeem continue to decline somewhat for the next several years. Of remaining $19 million have will enable the System to the five year expenditures, been temporarilyinvested and drastically reduce the amount about $210.1 million or ,
will be utilized in 1984 as of external Snancing required 70.4% will go for generation-additional expenditures are in 1984. Current plans for related projacts and include made on these pollution the hfarch 1,1984 cost 1984 call for the sale of two control facilities. $6 million tax-exempt bond increases announced Seabrook nuclearts. um,for The the The Association sold one issues. These 6nancings are million common shares to contingent upon a continu- balance of $88.2 mill, ion will underwriters in December ation of favorable tax laws be used for transmission, 1983.His sale provided net proceeds of approximately " System construction expenditures peaked at
$16 million. Current projections indicate that this $103 million. Nineteen hundred eighty-four sho be p" g gg ns es.
expenditures are estimated to be somewhat less An additional $6 mi!! ion of and are expected to continue to decline for the new common equity was raised through participation next several years."
in our Dividend Reinvestment and Common Share Purchase with respect to the issuance distribution and general Plan and our Employee of tax-exempt securities. projects.
Savings Plan. It is also anticipated that EUA continues to pursue ne foregoing $102 m31 ion our Dividend Reinvestment a strategy of establishing an of Anancing completed this and Common Share Purchase economic mit of production year has enabled the System to Plan and Employee's Savings resources designed to create end the year with no short- Plan will provide an additional an efficient and reliable term bank debt for the second $7 million in 1984. source of electric power for consecutive ye.r. This minimal amount of the System. This strategy Anancing described above was developedin the 1970s 1984 ExternalFinancing should enable the System to to reduce to manageable i Afimmal end 1984 with a rel'a tively levels EUNs dependence on I
The combination of reduced minor amount of short-term fuel oil,by diversifying our cash construction require- bank debt. energy sources among nuclear, ments, improved internal cash coal, hydro and oil facilities, generation, and utilization of and to minimize Anancial the remaining $19 million of and operating risks by acquir-tax-exempt Snancing proceeds ing capacity from a number of sources.
7
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f I ownership share in the two internalCarh Generation L NuclearCommitmentShows Improves Long-Term Beneffts 1150 mw Seabrookunits and a 4.01% sharein the single He System was able to EUNs early commituent to 1150 mw Millstone No. 3 unit. generate 35% of its cash the Pilgrim and the four construction needs from l
On Afarch I,1984, the Yankee nuclear units has internal sourcesin 1983 lead participant of the provided significant cost - a dramatic improvement Seabrook nuclear units (Pub- over recent years. It is savings to our customers over lic Service Company of New 2 the last two decades. expected that, for 1984, Hampshire) announced a Our continued commit- inten.algeneration will ment to nuclear poweris substantialincrease in the intended to fulfill a need for cost estimates and later in-baseload capacity while service dates for both co*
reducing the need to burn units. Hese resised esti-mates indicate that Unit ;
high-cost oil.Ongomg ap f No. I was approximately praisals of the economics o '
' nuclear power continue to 72% complete as of Decem- 45 show long-term benefits. ber 31.1983;its-in-service date will be July,1986 and Since the Three Mile Islandincidentin 1979, the its total cost will be approxi- 3o nuclearindustry in this mately S4.6 billion. Unit No.
r country has san significant 2 was 22% complete,its in-c increases in regulation.This, service date will be Decem- "
in turn, has resulted in pro- ber,1990 and its cost will be longed construction delays approximately $4.4 billion.
Several participants in the and ultimately substantial * '2
costincreasesin projects Seabrook project have unsuc-under construction- cessfully attempted to bring *D
- I"""
While the System has ex- about the cancellation of I" '*""*
perienced its share of these Unit No. 2- heeImproved dramaticeity
< increases, our exposure to %e Millstone No. 3 Unit is einee 19e0 and le expected suchincreases and our expos- currently on schedule and on to approach the current budget. As of November 30. electric Industry everage ure to the risks associated (50%) by the end of 1984.
with the uncertainty sur- 1983 it was approximately munding nuclear construction 80% complete. Federal and '
projectsis significantly less State licensing procedures are account for more than 47%
than many other utilities. This progressing and the in-sersice of cashconstruction is due to our relatively small date of May 1986 appears '
requirements.The improve-ownership share in each proj- achievable, mentininternalcash ect. Montaup has a 2.90% generation is directly related to the responsive rate relief 1 obtained at the Federallevel and is more fully explained
- earlier in this Report.
l CoalConversion Progresses ,
The conversion of two units at Montaup's Somerset Station from expensive oil
, tolower cost domestic coal ,
i continues. Current construe-tion activity centers on the t installation of state-of-the-art electrstatic precipitators on l boti units. His equipment is ,
i designed to allow Montaup l to ef21:iently burn low-cost
{ coal. In fact, stack particulate emissions are expected to be less than when the plant was '
burning oil. Full coal burning within environmentally
( acceptable standards,is i expected to commence by the i late summer of 1984, nearly '
one full year ahead of the
! , , , original schedule.
- reduced its dependence on When conversion is com-Fnergy kHzt oil to 80% Sy 1988 we expect plete, Montaup's Somerset i
' 5 Oil our onwgy mix to be Station will have the option 5 Coat diversified to the extent that of using either oil or coal as j 5 Nueteer we are not largely dependent a fuel, whichever isless B Hydro on any one fuel source.
in 1983 the EUA Syelem began burning lower cost coal and 3
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l During part of 1983 ne System willinitially Extensive testing of hard-Montaup's Somerset Station be entitled to purchase ware, software and communi-burned coal under a Delayed approximately I50 thousand cation links to remote termin-Compliance Order (DCO) mwhperyearof thislow-cost als was performed. The issued by the Federal energy which will further aid testing demonstrated that the Environmental Protection la reducing our dependence system met high availability l
i Agency and monitored by the on oil. and reliability specifications.
System operators are now "With the Conversion to Coal and additional able to centrally monitor I and control our trans-RUClear power Coming on line, We are steadily mission and distribution moving towards our goal of greater diversification "** h '
ch Sf n anahform l of fuel sources so that We Will no longer be other data acquisition tasks
! with the application of this
(
dependent on any single fuel for the generation advanced technology. The l of electricity,,, EUA System is in the forefront l
of this phase of electric utility operations.
Afassachusetts Department of hile 1983 saw con-EnvironmentalOuality A centralized automated tinued progress in trouble reporting system was Engineering. De order improving the implemented in 1983. All temporarily relaxes air quality System's Anancialposition,the customer calls are now regulations that do not affect year was also noteworthy for received in the System's public health. activity in the areas of system
' Customer Service Center.
Burning coal, the Somerset operations, energy conserva- Here the specifics of the units will ultimately be tion and communications. difficulty the customer is capable of providing about one-third of the System's nwenue energy requirements. It will also allow us to pass on to customers annual savings l based on the cost differential g,
between od and coal and significantly reduce out -<
dependence on oil as a source i
of energy.ne System was able to reduce that dependence '*
- on oilfrom 78% ofits total energy mix in 1982 to 60% '* O'"emme umane by the end of 1983.
i Hydro Projects Progress Progress contmues on the reactivatinn of Blackstone Valley Electric's 87-year-old am M bydroelectric generating tsAs oins,operemon and answenenos plant in Pawtucket, Rhode ,a pu,,n,,, p,,,
Island, ne reactivation plan calls for the installation of new, fully automatic, turbine / isas rense generators. Construction is ea, . p ene _.
expected to be completed during the Spring of 1984 at y,
a cost of approximately $6 million. Revenue / Expense Doller: expensee. We continueny I
ne System, along with Puoi and Purchseed Power strtve to secure the lowest I other New England utilities is continue to be our largeet peesthie price for fuel participating in negotiations expense two comprising purcheses, with Hydro Ouebec to bring over en o. etal operame low-cost hydroelectricity to New England. During 1983 CentralOperar'ms Syrrems experiencing are merged with arrangements were completed 0+Une which will allow the New teenicalinformation from ne System's new SCADA the computer data base.
England utilities to purchase (Supervisory Control and Data This information is trans-three million megawatthours Acquisition) system went on mitted simultaneously to (mwh) per year of hydro- line in October,1983. SCADA for analysis, and to electric energy beginning in the local operations section 1986. Discussions are cura from which our repair crews rently underway to increase are radio-dispatched to the the interconnection to 2000 scene.
megawatts.
9 I
ew Trustee Elected -
pation atpublic forums, never Samuel C, Brown Prompt restoration of serv-before has there been such a resigned as a Trustee Ice has always been a priority need for articulate, knowl-for the EU A System. The at the end of 1983, having edgeable goodwill ambassa- reached the mandatory new centralized trouble sys- dors to present the System's tem is provirng even better retirement age. Mr. Brown poelon. has served with distinction as service to ou. customers. Spansion of the System's aTrusteeof the Association Conservation Egorts efkrts to provide more since 1967, and his wisdom Enhanced comprehensive educational services to schools beganin and counselwillbe missed.
A program to aid customers John E. Conway was elected in their energy conservation 1983. Safety programs, a Trustee to fdl the vacancy.
efforts was initiated in Rhode demonstrations, films, liters- Mr.Conway is President of Island in 1983'
$, ",,*,*,Y cf, ,7,'y g
"The broad-based and aggressive customer company,andis also associated with several communications efforts initiated in 1982 were insurance agency, mortgage, continued in1983 and expanded with and construction tending companies.
Considerable success." Thet talnumberof EUA ture and classroom study kits System empt yees at year-end Essentially the program is have traditionally been avail- P designed to help residential customers who use electricity able to teachers throughout our system, and are used
{I'd , 98L 19% from the peak employ-to heat their homes and/or principally in elementary mentievelof approximately hot water, to reduce their emplo es schools.The need to reach 1 energy consumption and elec- secondary school audiences in 8 the s of P' P trical iemand. For some con- a more systematic manner led this nation,s energy crisis in servation measures taken, to the formation of a pilot the latter part of 1973. Less cash grac's are available program aimed specifically at thanhalf of theincrea,ein s the which,in effect. onset the cost the high schoollevel. number of emplo)ecs is the of the money the customer It's your System's intention d usually must borrow to e{pa d gnee,s, to build a constructive work. p ,
,g n neer og implement the conservation ing relstionship with edu- pr m measures. Other conservarron catorsin order to demonstrate steps are subsidized. Any 8 P qualifying low-income cus-a genuine concern for energy C "8to ba Ey a n:
tomer is offered a free, do it- education and to enhance the ,ta acceptance of our educa- increase is attributable to yourself home weatherization tional services programs.
Lit.
A similar program is ex-
"We are proud of our mployees for the pected to be offered in Manxhu,etts in Int prof essionalism they bring to their daily tas Communication Aerivitier and for their willingness to communicale with increase The broad-based and aggres- their friends, relatives and neighbors to bring sive customer communications about a better understanding of electric i effortsinitiated in 1982 were continuedin 1983 and issues "
expanded with considerable success.
Particularly notewnr+hy During the 1982 83 academic Alling positions wh authorized but unfilled at t' wastheimpactof the EUA year more than 16,000 end of 1982, kindergarten through twelfth We are proud of our Employees' Speakers Club, grade students benefitted employees for the professi.
through whose efforts thous-from these programs. stism they bring to their d.
ands of customers were tasks, and for their witting reached. In 1983 the number of engagements and total to communicate with their audience was the highest ever. friends, relatives and While we have always neig5.bors to bring alvut r encouraged employe partici- better understanding of electric industry issues.
10
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l oday's technology h
payment information can be raphic display termi. >
Tprovides powerful tools to help control quickly tracked; System Operators are provided with nals connected directly to the costs andimprove productivity an up-to-the-minute status of System's computer center in meeting the complex the movement of electric enable personnel to immedi-demands of today's business energy through EUKs trans- ately update the more than environment. State-of-the art mission and distribution imes; 4,000 maps locating each item >
electrostatic precipitators and power demand and revenue of the System's electrical ;
electronic monitoring systems, requirements are more transmis< ion and dnstnbution '
for instance, will enable accurately forecast; billing and equipnnent. Electronic map-Montaup's Somerset Station to payment processing are ping replaces laboriously burn economical coal. speeded; crews are more hand-drawn maps with a com.
Individualproductivity is rapidly dispatchedin an puterized database. Copies of improved by the use of emergency - all through use accurate maps can be supplied l computers - billing and of computers. Some of the to engineers and construction .
ways this technology Arlps crews showing just as much or EUA employees perform their as little information as needed. (
daily tasks are shown on these pages.
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l he familiar meter i
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reader takes the Hrst i
k l'
'.I step in EUNs highly
' , ' : *' automated billing process.
' Vf* T Each day, thousands of ;
I special cards on which the r
customer's meter readings l
have been marked are " read
by electronic optical scanners. .
Bills are automatically pro- ,
- duced, sorted and prepared for mailmg. and customer l records are simultaneously [
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> updated at the System's ,
. h 2 computer center.He EUA !
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System is one of only a few utilities in the nation able to I
A l speed its revenue now and f- teduce costs by mailing its
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bills within 24 hours2.777778e-4 days <br />0.00667 hours <br />3.968254e-5 weeks <br />9.132e-6 months <br /> after
' meters are read.g I
j omputers play a major
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other utilities of the New
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- ' - +'c- T his Syste n computer Tcenteris the elec-tronic home for all EUA Anancial and operating data and customer records.
Bills originate here, and pay-i ments are recorded by these , computers. Video display terminals enable Anancial , forecasting and ptsnning as well as accounting analysis to be done from various System locations with access to up-to.date information in the l computers. Emergency calls are recorded and electron. leatly routed to the proper operations section through i these computers. ! l r i I i I I r I l l e 18 i l l t t i
Selected Consolidated Financial Date Years Ended December 31, 1983 1982 1981 1980 1979 Un Thomaandr Except Careneon Shares and Per Share Anecents) Emesome Samenusent Deens Operating Revenues $302,454 $288,417 $297,931 $244,642 $185,801 Ol watingincome 36,537 31,296 28,834 24,115 21,395 Consolidated Net lacame 25,364 16,941 12,437 8,990 8,488 Balance Aset Dean: Plantin Service 374,132 358,599 348,255 333,812 322,684 Construcean Work in Progress 249,700 172,057 109,348 82,308 61,493 Gross Utility Plant 623,832 530,656 457,603 Accumulated Depreciation 416.120 384,177 125,548 117,396 110,163 101,857 94,618 Net Utility Plant 498,264 413,260 347,440 314,263 289,559 Total Assets 885,135 489,259 426,821 390,958 348,642
'W I.mg-Term Debt 286,398 199,850 188,464 162,682 123,485 Redeemable Preferred Stock 34,155 34,457 19,906 20,199 5,607 Non-Redeemable Preferred Stock 15,479 15,079 15,079 15,079 15,079 Common Equity 172,327 140,973 109,875 95,424 93,765 Total Capir_..__.;.w 477,999 390,359 333,324 293,384 237,936 Short-Term Debt 0 0 27,100 31.540 63,300 Commen Stock Deen:
Earnings per Average Conunon Share 2.80 2.25 2.03 1.63 1.74 Average Number of Shares Outstandag 9,462,810 7,519,381 6,123,334 5,525,320 4,871,667 Return on Average Common Equity 16.2 % 13.5 % 12.1 % 9.5% 9.4% Market Price-High ISM 14 % 12 % 13 % 15 %
-Imr 13 % 11 10 % 10 % 11 %
Cash Dividends Paid per Share L79 1.70 1.60 1.60 1.60 ! 19
conservation efforts by our customers. The maw's Discueolost asist percent of increase or decrease in the EUA g g gg g g System's kwh sales by class of customers and and Results of Cy__-,-_ in total since 1981 is shown in the following tabic: Earnings For the third consecutive year, the EUA Sye- Increase (Decrease) from Prior Years tem's franndal performance and strength con- tes3 s982 tinued to improve, thanandanant Net income 13 % for 1983 increased 49.7% over 1982 and amew s.34 rw s.7 (1.0) 1982 increased 36.2% over 1981. Earnings A9 (8.2) per average common share of $2.80 in 1983 temmerial whoissas, s.s (15 3) lacrossed 24.4% over 1982,while 1982 per (3.6) (10.7) Other share earnmes showed an increams of 10.8% 3.7 % (5.1)% over 1981.%e earmnes per share include the Total ofects ofincreases of 20.5% and 22.8%, . respectively,in the average nuesber of
~" " By the end of 1983, the EUA System was able OpendusRevennu to reduce its dependence on fuel oil frcen the Operating Revenues in 1983 increased $14.0 78% level of 1982 to 60%.This was accom-million from 1982 whGe 1982 decreased plished primarily as a result of the com-
$9.5 million from 1981. The table W mencement, in March 1983, of coal burning at analyses the chan8es in Operatag Revenues our Somerset plant. EUA System fuel expenses 8i"C'I'8I* decreased $9.4 million or 6.9% in 1983 from 1982 and 1982 decreased $27.1 million g,er,,,, (p.e,eens) or 16.5% from 1981. Purchased Power-from Prior Years 1983 1982 Demand costs increased $6.8 million in 1983 fs k musens) and $4.4 million in 1982, or 20.9% and Operating Revenue in- 15.4%, respectively, over prior periods pri-crease Attritmtable To: marHy due to increases in operating costs at Recovery Of 1%el Cases g(ste) $(19.6) several nuclear generating units in which the m=w Esset Of Rase is.2 Ste System has ownership interests or unit con-Incrosses (1.5) 5.7 tracts. Other operation and maintenance Kwh Sales (6.6)
(1.7) expenses have continued to increase since Unit Contracts 8Ito 8 (9.5) IS 81. The 1983 increases in other operation Tesal and maintenance expenses reflect increased costs related to the burning of coal at the De revenues attributable to fuel costs are Somerset plant. The balance of the increases the result d timely recovery of such costs through the operation of the adjustment for 1983 and the increases for 1982 reflect the effects of in8ation on labor, materials clauses. The estimated effcst of rate increases for andthystem other costs. experienced increases in the the periods shown, reflect the bining d higher level of Allowance for Funds Used During wholesale and retail rates of $17.1 million and Construction (AFUDC) (both equity and debt
$6.9 million, respectively in 1983 and $l2.1 million and $6.1 million,respectively in 1982. totaling $8.5 minionin 1983 and $3.2 mDIion in 1982. AFUDC represents a non-Operating Revenvee include revenues cash element of income. The System's con-subject to possible refund of approalmately
$10.8 million and $11.7 malion for year.end tinuing expenditures for the construction of I 1983 and 1982, roepectively. See Note I of future generating facilities has resulted in signincant increases in the level of construe-l Notes to Consolidated Financial Statements.tion-work-in-progress balances to which the Kuowatthour sales improved in 1983 as a result of a general h.-_t " gof the AFUDC rate is applied. AFUDC as a economy. In addition, weather conditions percentage of consolidated net income signincandy in8aenced twh sales in 1983 bydecreased from 102% in 1981 to 94% in 19 and rose slightly to 96% in 1983. The inclu-their effect on air conditioning and heating l
elon in rate base during 1982 and 1983 of a loads. The 1983 sununer airi-- S ~ ': d construction work in y I season was signincantly hotter than 1982, I while the end of the 1983 wmter heating - ited theincreasein AFUDC. l
'i season was colder than normal. The depressed Increases in total interest expense are twh satee in 1982 resulted primarily from reRective d the System's continuing need to borro v funds to meet those cash requiremer:
genwally weak economic conditions and of its construction program which cannot be met with funds generated interna!!y from operations.
Cl i
.- _ ~ . ~ , . . _ - _ . . . . ..
Immenlalong eum debtimeuset simos Current Federalregulatory rules 1931 reAsce yeeser amouma of debt out- .penm
. it a cash return to be earned on a seamens, mainly due to the pensament fumeng portion of new goesrating fa:ihties under of short-teret debt.(Seeman===e of Chri- osaseraction.
talimation for details). Other Imeerest Espanse Perunament Amancing during 1983 included demonsed $1.1 maion frems 1982 and a $40 = ming Mortgage Bond Issue, a $40 deaussed 83.3 miBion in 1982 tem 1981 =mian Pollution Control Bond Issue (of which prhmerEy as a russit of reduced lessis of $19.6 million is held the Trustee), as shore ementoerowings, underwritten public of 1,000,000 laAssion condmuss to have's sig=na,= common shares and the issuenos of 403,313 Impact on the operahan of our Sysessa. At the common shares throudi the EUA System's
~ Federallevel whoissale rass enhas precuses Dividsed Reinvestment and Fmployee Share permit a forward laaHay test period which Ownership Flans. Not proceeds from thsee emaides the ==meipmeiam of % sales totaled approaimately $102 mignon.
increases. The tradissonal use of a hisenrical 1he n .a==p completed during 1933 and 1 test period for recoil = M- purposes 1982 enabled the EUA System to end both a: at the sense level does not provkle a resseeable years wieli no short-term bank borrowings. The opportmuty for Sysesus seenily- to aidlity to maaintain reduced levels of short-serm actuaEy earn their ellowed return on invessed . borrowings wiu be We on the System's capital Aeoonhagly, Syeesus reena v == ability to increase the amount of funds have contineauy included requests for gamermoed internaRy, thereby reducmg the need "neerimon" or "aresion" adjusemanes in their to borrow esternany, and the ability to sell race mings and we comeinse to parame ha' amouem of permanent securities, as moeded. these and other comespes la an esort to bring actual sermed returas cleast to the level per. mitted by the reguintory associos. See WdW
" Supplementary Information to D6.,aana the lhe =aaag==nt of Eastern Usuisies BSects of Pricas"os pees 30 for A-,a= is r p aan for the aa=, ash fhrther Saaacial onmation regarding gmancial =*=*a===*= and ninted inforusadon Ein
- Sect of N using mesurment bases included in ab4 annual report. The mancial a Financial * - sentements are prepared in accordance with
.sa-a y acupes-dng, rune, des nammsimar--me== applicable to raw-enguinted stades and include j
The EUA Systan's need for perunement cephal amants based on the best estimates and le primarily raamand to the conseraction of M of =aaag-aw, giving approprises fah wh to most the needs of its omidweden to materialky. Financial infonna. existing cussomere and to meet the femme tion included elsewhen la the annual report requinmemes of these customers as wee as new is ca=a aa==t with the Amancial seassansas. ' customers. For 1983,1982 and 1981, the The Compeay mainteens an accoumaing EUA Systems's cash constructies sapendases synese and related system of internal comerale (excluding APUDO. were $73.9 mSom, which are designed to provide W
$61.2 mala = and $41.7 =imiam '
amrance as to the nuability of Saancial The Syssem espects cash constraddon records and the protection of assets. The Com. esponetures to decreene to about $77.1 pany's statt of internal auditors conducte reviews to maisensa the eSeceivemens of lasernal mWien in 1984 and to condous to destas for , someret procedures. the next severalyears. ' As is essessmery in the menty indesary, ensh Aleaander Grant & Company,sortised conservedom requirement not am whh in. pubhc accountanu, is emessed to esamine torneBy gamermoed funds are obesined throudi and espress an opinion on our Amancial someo-short-earm borrowings which are addmately mente. Their a==8=mia== laciude a review funded with pomissent capital. In 1983, ofinestnel comerole to the onesnt imeerneBy generated funds annousted to $27.3 by generap y ==pa=aauedag i
=mia= or 34.5% of the cash construedom The Audit l'a==3sama of the Board of ilho semaining cash conseraction Tmseems, which conseses solely of oueside requinmenes won funded whh skerwarm T"". ""'8 *idi menessment, ineernal beak borrowings which were uhiessely auditors and Alesander Grant & Compmay to pennenemely Ananced. In 1932 and 1931, the h auedng,imurnal controls and Anancial EUA System was aide to gamernes 22.5% and 8ePorting saatters. The inesmal nomears and 4.3%, respostively, of les essh esmemados Ornat & Company have free ascene requinmienes with interna 5y gamerseed funds
#'""*dnt to the Au Consanisees without managem with the belanos coming hem shorHurm F"""8-
-.-- . The System especes est in 1984 it wiu be able to pseernes losamesy slightly more than 47% ofles cash assomsedan 21
.~~_;__ __ . _ _ . .
Consolideled Income $4000snent 1983 1982 1981 Years Ended December 31, (in V . '- Eurre N L:.of Shares nad Yer Share Amounts)
$ 302,480 $ 288,417 $ 297,931 Operating Revenues (A)(1)
Opereung Espesues 127,000 137,308 164,367 Puel 39,544 32,732 28,362 Purchased Power-Damad (I) 43,107 40,156 35,178 Other Operation 7,809 7,852 7,144 Maintenana 14,571 13,379 11,280 Depreciation and Amortization (A) 14,143 14,358 12.990 Taxes-Other'Than laceae 20,218 11,551 8,458 I=== sad Deferred Taxes (A) (B) 245,913 257,121 269,097 TotalOn,4 Expenses 36,537 31,296 28,834
.- Opersting locome
' Equity in Earnings of Nuclear Generating 1,121 928 1,331
- Companise (A) ,
Allowance for Other INeds Used During 4,955 12,684 6,657 Construction (A) 152 482 781 Other I- r =- -Net
$1.303 39,226 35,199 1+ == Before Interest Charges laterest Cherres: 29,148 23,760 19,552 Interest on 1.ong-Term Debt 2,691 3,764 7,063 Other Interest Expense Allowance forBorrowed Funds Used (9,203) (7,736)
During Construction (Credit) (A) (11.713) 20,126 18,321 18,879 Net taterest Qarges 31,177 20,905 16,320 Income AfterlaterestCharges 5,813 3,964 3,883 Preferred Dividends of Subsidiaries S 25,364 $ 16,941 $ 12,437_ C"idated Net t-9,462.810 7,519,381 6,123,334 Aversge Common Shares C-7 " ; Consolidated Earnmes Per Average 82.80 $2.03 Common Share _ $2.25
$1.79 $1.70 $1.60 Dividends Per Common Share Consolidated Retained Earnings Statement ~
1983 1982 1981 Years Ended December 31, (In TAnmanads) Consolidated Retained Earnings- $30,396 $26,137 $23,462 Beginning of Year - 25,364 16,941 12,437 Connotidated Net 1+- 55,760 43,078 35,899 Total 14,029 12,682 9,762 Dividends Paid- EUA Canunon Shares Coneohdated Retained Earnings- $26,137 839,731 $30,396 _End of Year (E) The serempanylar nous are en tangent part of she kandat nenumenn s 22
consolidated statement of changes in FinancialPoeNion Years Ended hw 31, 1983 1932 1981 on The.nenkt sonree of hads inrenen0y Generered: Income Afterlasseet Charges 8 31,177 8 20,905 $16,320 Pnacipal Non-Cash Qarges (Oedits) to Income. Depreciation (A) 11,618 11,277 10,876 Amortization 3,400 3,223 1,376 Deferred Taxes (A) (B) 10,086 4,694 6,604 Investment Tax Credits, Net (A) 7,635 5,565 1,016 Equity in Undistributed Earnings of Nuclear Generating Companies (783) (500) (464) Allowance for Funds Used During . Construction (A) (24397) (15,860) (12,691) Funds from Operations 38,786 29,304 23,037 ,, Proceeds from Oil Conservation Adjustment 14,314
- f. Ass: Dividends Declared EUA Common Dividends (14429) (12,682) (9,'62)
Subsidiary Preferred Dividends (5,813) (3,964) (3,883) Internally Generated Funds 27,288 12,658 9,392 Extern,alSources: Proceeds from Sale of Common Shares 22,239 26,975 I1,908 Proceeds from Sale of long-Term Debt - Net 61,019 24,000 30,800 Proceeds from Sale of Preferred Stock 15,000 Other- Net 5,140 2,418 171 Funds from External Sources 98,398 68,393 42,879 Total Source of Funds $115,686 $ 8I,051 $52,271 A W = efFunds Construction Expenditures $103,309 $ 77,096 $54,436 IJss: Allowance for Funds Used Duing Construction (24397) (15,860) (12,691) Cash Construction Espenditures 78,912 61.236 41,745 Decrease in Short-Term Debt 27,100 4.440 Retirement ofImag-Term Debt 13,996 3,000 Retirement of Preferred Stock 300 300 300 Increase (Decrease) in Working Capital 14663 (10,454) (2,105) Other Applicatio.1-Net 7,785 2,869 2,891 Total Application of Funds $115,684 $ 81,051 $_52,271 Changes in f*- ,- of Werting Capteef* Cash 8 364 $ (809) $ 22 Accounts Receivable 10,107 (4,546) (3,062) Materials and Supplies 3,884 3,152 (6,246) OtherCurrent Assets 117 (176) 56 Accounts Payable 5,711 (7,331) 9,669 4 Accrued Taxes (3,600) (73) (312) Other Current IJabilities (1,730) (671) (2,232) Increase (Decrease) in Working Capital $ 14663 $(10,454) $(2,105)
- HEnlaano Sherr Tam Dat. Comas Defame Tem and Rekeneeke Pretemd Snoet 3sakW fund Resourmanop The erroneponyhet neers era en tantgral perr et she keencial oneernerne.
23
- - , . - - - - ,m - . , . . - w_, - -.- -m, %-- , . _ _ . - - - . y
F*- o ConseNdetod Belence Sheet 19e3 1982 h 31 (la Themamed,) Assues Urmry Plant and Osherlaveesneest Utility Plant (A) (H): $374,132 8358,599 In Service 128,568 117,396 IJss Accumeleted Prtyvision for E., _ ' --(A) 248,964 241,203 Net Utility Plantin Service 349,100 172,057 Cometraction Work in Progress 498,264 413.260 Net Utility Plant 901 903 Nonutility Property- Net 9,139 3,313 Investmenta in Nuclear Generating Companies (A) 69 so Other Investments (at cost) ses,373 422,545 Total Utility Plant and Other lavestments Cwrent Assess: 564 299 Cash (0) Accounts Receivable: Customers,LAes Allowenes for Doubtful Accounts 23,502 38,831 of 8569,400 and 8349,500 E . -, 5,310 7,44e Accrued Unbilled Revenues (A) 3,9e9 820 Other Materials and Ss,$les (at everage cost) 12,899 9,090 1%el 5,483 S,578 Plant Materials and Operating Supplies 337 271 Other Current Asaste 68,743 47,370 TotalCurrent Assets Deferrent DeMas:
- 3,734 2,170 U- M Debt Expense 7,187 10.164 Estraordinary Property leases 2,098 7,010 Other Deferred Debite 18,019 19,344 Total Deferred Debits
$808,138 $489,259 Total Assets - - , - - ._ =
IJohWiles and t'W Capitalizadon: $172,317 $140.973 Common Equity 1:,c7 15,079 Non-Redeemable Preferred Stock of Subsidiaries 34,3 SS 34,457 Redeemable Preferred Stock of Subsidiaries 286,398 199,850 leng Term Debt -Net 477,999 390,359 TotalCapitalisation Cwrent Uebdities: 4,488 13.99f Imes Term Debt Due Within One Year 30,184 25,86' Accounts Peyable Redeemable Preferred Stock Senking Fund 300 2 61 Requirement 1,7M I,88 Customer Deposits 1,238 3,54 Tases Accrued (3) 3,240 2,44 Deferred Tases ( A) (3) 8,749 4.34' Interest Accrued 3,837 1,13 Other Current Uabilities 35,47' 48,477 TotalCurrent Webilities A Deterred Creafits: 31,284 13,61 UnarrartisedInvestment Credit ( A) led 12 Other Deferred Create 13,U 31,300 Total Deferred Creete _ __39,34t_ 29,67 , Accumulated Deferred Tames ( A) (B) __$808,135 $4R9,2' Total Web 616 ties and Capitalisation- -~~ - . =:=~ - == ==m . w . c the enenareers er nenre are en naneral pert of she hamment enumene 24
... ... ~ . - . -
$ $ h sev mm e,n.a k
, . t%S.m, _auf% }, M w., ..
.J &AWRpf Consolidated Statement of Cappelization N d"'***" " hl . _ _ . . . _ _ _.
Eastern Utdirnes Assocsnees % , Comrnon Shares: R , $5 per value, authorued 12,000,000 shares, outstandmg 10,192,304 shares in 1983 and 8,788,99i shares in 1982 (C) $ 54,962 $ 43,945 ti , Other Paid-In Capital (C) 03,406 68,183 l% Common Shares Expense (1,772) (1,55I) Q0" n+ - Retamed Earumgs (B) 39,731 30,396
#y> Total Canmon Equity __ ._ 172,327 36,1 % 140,973 36.1%
??, n =
~
kre[ erred $ soc [of subOT A h;f:q b~ cy Non-Radeemable Preferred (C): Blackstone Valley Electnc Company: y gr .. , 4.25%, $100 par value 35,000 shares (1) 3,500 3,500 W g a" 5 60%, $100 per value 25,000 shares (I) 2,300 2,300 a . W-4 ' Premsum 139 129
*1@fp-
;)[@. " i '
Eastern Edison Company: 4.64%, $100 per value 60,000 shares (I) 6,000 6,000 [*4 =--k, f 8 32%, $100 par value 30.000 shares (1) 3,000 3,000 N
'g -
- - -Expense, Net d Premium (90) (50)
Yr fN' , 13,079 3.3 15,079 3.9
.N/d%'
*C..n Redeemable Prderred (D):
Eastern Edison Company: MP@ ^ l3 25%, $100 par value 150,000 sharse (1) 13,000 15,000 D 1, '4 ,
- I3 60%, $100 par value (2) 4,000 5,100
-% 15 4a%, $100 par value 150,000 shares (1 ) 13,000 15,000
* " i M.g,y Espense, Net of Presuu'n Smking Fund and Reacquired Shares (331) (329) l7 M ' (314) (314) h I ,%c , 34,153 7,1 34,457 8.8 WW&?;O Long Term Debe (f).
Eastern Uuhues Aaaarnasse: gT-cv' ? 3, T.h Sensor Notes 10% % due 1999 22,500 22,500
';, th EUA Service Corporation:
1g Notes Fayable (Vanous Maturttles et
/$y# Money Market rates)
Bladstone Valley Electric Company; 2,000 1,400 19e: Mortgage lhads
, 14% % due 1995 (Sense A) 30,000 30,000
%, Eastern IAnon Company-First Mortgage and Collaseral Trust Bands:
3% % due1983 6,000 7% % dus 1981 (escnnd aartes) 5000 4% % due 1983 (tidrd earles) 2,196 3% % due1985 6,000 6,000 12% due 1985 (esmed eartes) 19,000 19,800 4%% dus 1987 3,000 3,000 4% % due 1988 3,000 3,000 14% % due 1990 13,000 15,000 17% % dus 1991 30,000 30,000 16% % due 1992 24,000 24,000 4% % due 1993 0,000 5,000 6% % due 1997 7,000 7,000 8% % due 1999 8,000 5,000 7% % due 2002 8,000 8,000 8% % dus2003 10,000 10,000 12% % dus 2013 40,000 Pollution Canerni Revenue Bonds (3 ): 10% % des 2008 30,419 N<we Payshie due 1985 (Prtme W 105% ) 80,000 10,000 Unanmrttred Frenuun 837 150 300,094 213.846 less Porths Due Within One Year 4,490 11,996 Total 186,300 83.4 199.8 SO 51 2 T usal Capitatueunn $477,999 100.0 % $ 190,199 100 0 % tin Aeehar*eed and ooreenmbos th Aenbertred GeDne shows Onenanmeng depne sheer h 1989 and flDee sharen be 1941 til Not of Dit,telAnne head be trenere fee - . reas news are en sowa ed pere of sho W sasume== 21
funds used during construct.on and inerect ItotesTo ConeoNdeled charges for engineering and supervidon. prinencial Stategnente Depreciation of Utility Plant: For f.nancial ommser st, ans, tees andINI statement purposes, depreciation is cceputed (A) Samanry of W Aseennslug on the straight-line method based on estimated F""*8" usefullives of the various classes of property. Cameral:EasternUtilities Associates (EUA) Provisions for depreciation, en a consoli-and EUA Service Corporation (Service) are dated basis, were equivalent to a composite rate subject to the jurisdiction of the Securities of approximately 3.2% in 1983,1982 and and Exchangeca==l=W under the Public 1981 based on the average depreciable Utility Holding Company Act of 1935, and property balances at the beginning and end Service's accounts are maintamed under the of each year. system of accounts prescribed by that Act.De Operating Revenues: Revenues are based accounting policies and practices of the retail on billing rates authorized by apphcable subsidiaries,namely Blackstone Valley Federal and state regulatory commissions. The Electric Company (minha=*) and Eastern retail subsidiaries follow the policy of Edison Company (Eastern Edison), and of accruing the estimated amount of unbilled base Montaup Electric Company (Montaup) are rate revenues for electricity provided at the subject to tegulauon by the Federal Energy and of the month to more closely match costs Regulatory rammmian (FERCl and the and revenues. In addition they also accrue respective state regulatory en==i=3a== with unrecovered fuelcosts. respect to their rates and accounting. De Federellacome Taxes:The general policy retail subsidiaries and Montaup conform with of EUA and its subsidiaries with respect to generally accepted accounting principles, as accounting for Federal income taxes is to redect applied in the case of regulated public utilities, in income the estimated amount of taxes and conform with the accounting requirements currently payable and to provide for deferred and rate-making practices of the regulatory taxes on certain items subject to timing authority having jurisdiction. diferences to the extent permitted by the Principles of Consollefarion:We consoli- various regulatory commissions. See Note B for dated Snancial statements include the accounts details of major deferred tax items. of EUA andits subsidiaries (Blackstone, As permitted by the regulatory commissions Eastern Edison, Montaup and Service). All it is the policy of the subsidiaries to defer the material intercompany balances and transac- annual investment tax credits and to amortize tions have been etunineted in coneohdation. these credits over the productive lives of the Nuclear Generating Companies: Montaup related aseets. tallows the equity teethod of accounting for Allowance for Funds Used During Con. Its investments in four regional nuclear gener. struction: Allowance for funds used during sting companies. Montaup's investments in construction (AFUDC (a non-cash item) these companies range from 2.50 to 4.50 is defined in the applicable regulatory system percent. Montaup is entitled to electricity of accounts as *%e net cost during the period produced froen these facilities based on its of construction of borrowed funds used for ownership interests and is billed pursuant to construction purposes and a reasonable rate contractual agreements which are approved upon other funds when so used." by FERC. De combined rate used in calculating Utility Plant: Utility plant is stated at AFUDC was 14.00% in 1983,1982 and 1981, original cost. De cost of additions to utility In accordance with rate orders, Eastern plant includes contracsed work, direct labor Edison and Montaup provide deferred income and material, aliar=No overhead, aBowance for tues on the borrowed funds component of A NC. (B) Ineame and Dessered Toness Components of income and deferred tas espense for the years 1983,1982 and 1981 are as follows: (la7" " 1983 1982 1981 Federal: Current S 738 $ 435 $ 509 Deferred 9MS 4,455 6.179 Investment Tan credit. Net 8,143 5,778 958 27,900 10.668 7,646 sente.- Current 1,274 645 387 906 238 425 Deferred 2,300 883 512 30,218 11,531 5,438 Chargod to Operations Charged to Other income 417 133
$30,638 $11,684 $8,438 Total 26
Federalincome tax expense was less than the income tax statutory rates to book income amounts computed by applying Federal subject to tax for the following reasons: (In Nassads) 1983 1982 1981 Federal lacome Tax Computed at Statu-tory Rates $23,196 $14,661 $11,243 (Decreases) Increasesla Tax From: APUDC M424) (3,151) (2,581) Excess Tax L,- 1,326 229 176 Other (191) (970) (673) Federallocome Tax Expense $18,387 $10,769 $ 8,163
'the provision for deferred taxes resulting from timing differences is comprised of the following:
#a Nassads) . 1983 1982 1981 Excess Tax Depreciation S 2,076 $ 1,282 3 1,083 Computer Conversion Costs (33) (120) (135)
Estimated Unbilled Revenue 784 %9 103 Unbilled Purchased Power Costs (1.702) (731) Unbilled Fuel Costs 1,347 373 (235) DebtComponentof AFUDC 8,878 3,978 3,281 Abandonment I n==as (847) (806) 2,818 Capitalised Overheads 787 481 E8ect of State and localTaxes 986 238 425 l Other- Net (12) 1 (5) Total $10M6 $ 4,694 5 6,604 At December 31,1983 unused investment which begin to expire in 1992, are available tax credits of approximately $10,380,000, to reduce future Federalincome tax li.ibility. (C) Ceyllelgesek: The changes in the number of common shares capital during the years ended December 3 !, outstanding and the increases in other paid-in 1983,1982 and 1981 were as follows; Nanberof th=an Shareslassed Dividend lacrease Reinvestment in Other and Employse Public Pald-in Year Savings Plans Sales Total Capital 1988 403,313 1,888,888 1,483,313 $18,222,736 1982 324,431 1,800,000 2,124,431 16.352,501 1981 180,926 900,000 1,080,926 6,503,102 la the event of involuntary liquidation the $105.62 prior to 10-1-88 and at reducsd non-redeemable preferred stock of premiume in subsequent years. Blackstone and Eastern Edison is entitled Under the terms and provisions of the to $100 per share. In the event of voluntary issues of preferred stock of Blackstone and liquidation, or if redeemed at the option Eastern Edison, certain restrictions are placed of those companies, the non-redeemable upon the payment of dividends on common preferred stock is entitled to: Blackstone's stock by each company. At December 31, 4.25 % lasue, $104.40; Blackstone's 5.60% 1983 and 1982 the respective capitalization issue, $103.82; Eastern Edison's 4.64% leeue, ratios were in excess of the minknum
$102.98; Eastern Edison's 8.32% issue, which would make these restrictions efective.
(D)
- h PredervedSeesk:
Eastern Edison's 13.60%,15.44% and public ofering price ($ 104.615, $ 101.50 and
% 13.25% Preferred Stock issues are entitled $ 100 respectively) plus accrued dividends.
to mandatory sinking funds suscient to Eastern Edison also has the non-cumulative redeem 3,000,6,000 and 7,500 shares, option of rars===ing an additional 3,000, respectively, during each twelve month period, 6,000 and 7,500 shares, respectively, during 1 - N October I,1980 la the caso each period at such price. In the case of of the 13.60% issue, October I,1985 la the the 13.25% issue,if Eastern Edison does not case of the 15.48% issue and January 31,1989 esercise its option of redeeming an additional in the case ci the 13.25% issue. The redsep- 7,500 shares, the holders of that preferred ! tion price, for each issue, is equal to the initial stock have the right to exercise such optica. 27 i l l
13.25% imus is emeieled to $113.25 prior to In es event af levelameery Equidelion es January 31,1984. De redumption pavai-sedeemehis pretersed sanskaf Bessem reduces in subsequent years. Edison is entidad to $100 per share. Im to no agregnes amount of sedsomshie event of soleneary thleidsdom, or N sedeemed preferred senck sinking fund sequiremanes for at the option of Essessa Edsen, the 13.80% each of the Ave years following 1983 are: and 15.48% issess of redeseshie peutuned $314,000 la 1984 and $923,000 in 1985, seack are entided to $114.82 and $l16.98 prior 1986,1987 and 1988. to October 1,1985, respectively; the (E) ReesheseEmulague subsidianes, Reenined Earnmes in the Under the psovisions of EUA's Sumiar Nees amount of $3,601.563 in the case of Blacit. Agressesman, Rosained in the 31, esons and $21,822,262 in the caos of Eastern amount of $32,253,020 as of Edison,as of Denscher 31,1983,were 1983 were unresericted as to ne payenset unrestricted as to the payuseet of cash dividseds of cash dividends os EUA Common Mares, on their Ceaumon Stock.
- Under provisions of the Indesamos escuing the various bond issues of the seteR (F) laus Tese Dehes additions" and asch uperts to continue Under tareas of the Indsammes sessing such practice during 1984, their various bondissues the retail The various bondissues of the retail subsishanes are required to deposit assusEy *Ames are seemed by substantially all .
wlek their TIrusses,cashla en annount to;1% of theagressesprincipal of their utility plant. In addition, Eastern Edison's Bonds are colisteralised by seewities amount of hoods previously W and delivered in the case or Esseura Edese and of Montaupin the principalamount of $280,910,000. 2.25% of the average pass invesament in The aggregate amount of EUA Systeem cash m _'" property la the case o B flk ac stone. sinking fund requirements and matwities The retail euheasharles have saueSed sinking for long.esras daht for ensk of the Ave yeare fund requirements for 1983 under alternate following 1983 are: S4.458,000 in 1984, provisions of their respective Indentwes $36,592,000 in 1985, $4.125,000 in 1986, by certifying to the Truseos "availaide property $7,125,m IM7 and IM. (G) IAmme of Ones In accordance with lefonnel agreements EUA System waies had unused short-term with the various banks commiemset fees are times of credlt wie various hemks of required to maintain the lines of eredit. approximately $47,000,000 and $44,500,000 at ihd=r 31,1983 and 1982,respectively, (E) ? ' 12 "Fasednes generating waaen= (douars la thousands): At December 31,1983 Monteep owned es fouoming interests in jointly-owned electric Not Construction ' Plant in Work in Passent Fleet in Accumuissed Progrees Servies ' ' , Servios Unit Ouesd 846,455 $ 2 50 tM% $64.271 $17,816 Canal No. 2 3,976 593 3,383 Wyman k 4 1.96 55 73,82? 2.90 62 7 seabrook No. I 21,235 Seabrook No.2 2.90 101,48: Minssone No. 3 4.01 l The esmonnes reprenant Moneaup's Monesup's abare of selated opera unanntenance sapenses is included in les Financing for any Imeerestla ear" -., . ' "ag operating empeness. such interestis by Momemiqr tu) r - and r==a e * = Future minismun rental pa at Tha Syesem ea-p==6 have leases esvenas December 31,1983 for such are certain facilities and equipement. Tosal estimated to agregate $1.842.000 in 1984, I rental esponse for these leases for the years $ I,784,000 in 1985, S1,690,000 in 1986, i
,' 1983,1982 and 1981 mmounced to appreal.
I $1,087,000 in 1987, $918,000 in 1988 and I macoly $1,845,000, $1,781,000 and $2,592,000 for years after 1988. S t,590,000, sespectively, The EU A System companies participate in All of the Sysess companies' leases ese i a pension plan covering substantieuy all treated as operatingleases for sees making of their employees. The total pension esponse purpasse and have base assoumend for charged to operations, which lacludes as sush;however,seresisIsans amortisation of past service cases over 20 mest the erlearianequiring . years, amounted to approximately $1,408.00 as set forth in the testsenset af Finanslal $1,942,000 and $1,640,000 for the years A% Senneeds No.13.E sashleases ended 1983,1982 and 1981, respectively. Tl ' were empitalised, to enounts herest EUA Systemicompanies make annual would not have a estarial eSest on assses, na.m% or seisted espeeses, i 28 ( - - - . - . . - . \ l l
- _....~_m. _
contributior.s to the plan equal to the amounts Montaup is unable to predict whether any accrued for pension expense. The accumu. other action willbe ordered by thGew lated plan benents and plan net assets for the Hampshire Public Utilities Commission or Em/:loyees' Retirement Plan of Eastern what effect such action, or any flamacing Utihties Associates and its Subsidiary Com. difficulties of PSNH or any other participant, pardes is piesced below. may have on the cost or completion of the Seabrook Units or on Montaup. Fur.her p , % 1, uary 1* delays m the in-service dates of the units 1983 1982 would in rease the ultimate costs of the units. Actuarial Present Value At December 31,1983 approximately
$23,700,000 of Montaup's revenue col.
of Accumulated
- Plan Benc6ts: lected during the years ended 1983,1982 Vested $26,697 $24,403 and 1931 are subject to possible refund. Of Nonvested 1,544 1.559 that amount approximately $ 10,800,000,
$11,700,000 and $1,200,000 relates to each
$28,241 $25,962 of those years, respectively. Montaup believes
' that any amounts which may ultimately be Market Value of Not Assets Available refunded will not have a material Snancial for Beneits $40,697 $32,289 e&ct.
Montaup and the other stockholders of The assumed rate of return usedin Vermont Yankee Nuclear Power Corporation
' determining the actuar41 present value of have guaranteed their respective pro rata the accumulated plan bene 6ts was 8.0% for shares (2.5% in the case of Montaup)of a 1983 and 1982. 340,000,000 nuclear fue! Enancing. la The EUA System is committed under addition, Montaup along with the other long-term purchase power contracts, stockholders of Connecticut Yankee Atomic expiring on various dates through the year Power Company have guaranteed their 2008, to pay demand charges whether respective pro rata shares (4.5% in the case or not energy is received. Under terms in of Montaup) of a bank line of credit of effect at December 31,1983 the aggregate up to $50,000,000 and a debenture bond annual minimum commitments for such issue of $50,000,000.The proceeds of the contracts is approximately $42,000,000 debentures were used in part to repay for each year through 1987. $38,000,000 in subordinated notes purchased by Montaup 1988 and will aggregate $654,000,000 for and other stockholders pursuant to an years after 1988. In addition, the EU A Sys. interim Snancing arrangement.
tem is required to pay additional amounts depending on the actual amount of energy Auditors' Report to theTrustees of received under such contracts. The demand Easterft Utilities AsseClates costs associated with these contracts are resected as Purchased Power. Demand on We have examined the consolidated balance the Consohdated Im:ome Statement. sheets and statements of capitalization of The EUA System's ~.u A program Eastern Utilities Associates and subsidiary is estimated at $101,478,000 for the year companies as of December 31,1983 and 1982 1984 and $298,311,000 for the years 1984 and the related consolidated statements of through 1988 (including allowance for funds income, retained earnings and changes in used during construction), financial position for each of the three Montaup has a 2.90% ownership interest years in the period ended December 31,1983. In each of the two 1150 megawatt nurlaar Our examinations were made in accordance generating units being constructed in Seabrook, with generally accepted auditing standards and, New Hampshire, by the lead partacipant, accordingly, included such tests of the Public Service Company of Ne r F=apaies accounting records and such other auditing l (PSNH). All of the a==ary state and procedures as we considered necessary in Federal regulatory approvals for the coo. the circumstances. struction of the units have been obi =Inart but In our opinion, the Snancial statements further appeals are possible. PSNH's original referred to above present fairly the consolidated 50% share of the Seabrook Units has Snancial position of Eastern Utilities been seduced to 35%.The New Hampshire Associates and subsidiary companies at Public Utilities r a--i la= has ordered December 31,1983 and 1982 and the
- PSNH to reduce its ownenhip abare in the consolidated results of their crerations and Seabrook Units to 28%. PSNH's oder to other changes in their financial position for each of utilities of an ownership interest of approxi. the three years in the period ended December l mately 7% received no substantial r=paaa== 31,1983 in conformity with generally accepted i
l Several participants in the Seabrook Units accounting principles applied on a consistent have unsuccessfully attempted to bring about basis. l l the cance!!ation of Unit No. 2. Boston, Massachusetts f b[- l March 2,1984 1 l 29
Quartetty Financial aruf conwnon shareinformation (t/naudited) Earness
!acome twas. per Common h After idated Aversee M'M P**
Operating Operatins Interest Net Common Dividends Revenues Inconne Charges laceme Share Paid Hish tow For te gmuseurs w auded 19e3:
$84,474 $ 9,023 $7,777 $4,333 $0.67 $0.455 18 % 14 %
December 31 Sepeannber 30 $73,015 $10,207 $8.587 $7,134 $0.79 M455 17M 15 %
$64,266 8 7,548 $6,313 $4,861 $0.54 $0.455 16 % 14 %
Jame 30
$e0,695 $ 9,760 $8,501 $7,036 $0.80 $0.425 15 % 13M March 31 For es quature omdad 1981s
$75,786 $ 7,942 $5,770 $4,682 $0.58 $0.425 14 % 13 December 31 Supeamber 30 $68,004 $ 7,944 $5,270 " $4,312 $0.56 30.425 13 % 11 %
$64,333 $ 7,037 $4,272 $3,314 $0.43 $0.415 13 % 12 June 30
$s0,363 $ 8,373 $5,593 $4,633 $0.69 $0.425 12M 11 March 31 The common shares of Eastern URstes of Common Shareholders of rrcord on February 1, Associates are Essed on the New York 5 sock Eschenge 1984 was J4,500.
and #Ae sickur er "sua" The approminnese masseer Supplementaryinfoemation To DiscloseThe Effects of Changing Prices Wnaudited) He following supplementary information is this reason fuel inventories are effectively supplied in accordance with the reqmroments monetary assets. of the Statement of Finanew Accounting As prescribed in Financial Accounting Standards No. 33 to provide certain informa- Standard No. 33, income taxes were not tion about the effects of changing prices. It adjusted, should be viewed as an estimate of the ap- Under the rate-making practices prescribed proximate effect of inflation, rather than a by the regclatory commissions to which the precise measure, since a number of subjective System companies are subject, only the his-judgments and estimating techniques were torical cost of plant is recoverable in revenues used in developing this information, as depreciation.Derefore, the excess of the Constant dollar amounts represent hastancal cost of plant stated in terms of constant costs stated in terms of dollars of equal dollars that exceeds the historical cos' of purchasing power, as meacared by the Con- plant is not presently recoverable in rates as sumer Price Index for all Urban Consumers. depreciation, and is reflected as a reduction l Current cost amounts reflect the changes to net recoverabic cost.To properly in speciSc prices from the date the plant was reGect the econonnics of rate regulation in acquired to the present, and differ from the Statement of Income from Continuing constant dollar amounts to the extent that Operations, the reduction to net recoverable specific prices have increased more or cost of net property, plant, and eqwpment less rapidly than pricesin general. should be offset by the gain from the De current cost of utility plant, comprising decline in purchasing power d net amounts l all plant in service, construction work in owed. During a period of inflation, holders progress and plant held for future use, of monetary assets suffer aloss of general l represents the estimated cost of replacing purchasing power while holders of i existing plant amets and was primarily monetary liabilities experience a gain. The determined by indexing the surviving plant gain from the decline in purchasing by the Handy-Whitman Index cf Public power of net amounts owed is primarily Utility C.- A Costs. attributable to the substantial amount of debt
- He current year's provision for depreciation which has been used to finance property, on a constant dollar and current cost basis plant, and equipment. Since the depreciation was computed by applying the current on this plant is limited to the recovery depreciation rates to the respective indexed of historical costs,the System companies plant amounts. do not have the opportunity to realize t Fuelinventories, the cost of fuel used in a holding gain on debt and are limited to generation, and purchaeart power for recovery only of the embedded cost of resale have not been restated froen their debt capital i
historical cost. Regulation limits the recovery l of fuel and purch..a power costs through the operation of adjustment clauses. For 30 l
-~
Consoildeled Statement of Income From Continuing Operations Adjusted For Changing Prices For the year ended December 31,1983 Constant Current Dollar Cost Average Average Historical 1983 1983 (Thomassds elDelders) Cost Dollars Dollars Operating Revenues $302,450 $302,450 $302,450' Fuel and Purchased Power Expense 167,458 167,458 167,458' Other Operating and Maintenance Expenses 50,716 50,716 50,716
. Depreciation and Amoreweeinn 14,571 30,564 36,118 Taxes Other han Income 12,950 12,950 12,950 Ircome Taxes 20,218 20,218 20,218 Interest Charges-Net 20,126 20,126 20,126 Other (Income) and Deductions-Net (14,766) (14,766) (I4,766) 271,273 287,266 292,820 Income (Ims) From Continuing Operations (excluding adjustment to net recoverable costs) $ 31.177 $ 15,184* $ 9,630 Increase in Speede Prices of Utility Plant . $ $
Held During the Year ** 17,676 Adjustmert to Net Recoverable Cost (869) 20,575 Effect of lacreases in General Price Level (33,566) Freens of Increase in General Price level Over Increase in Spec 6c Prices After Adjustment to Net Recoverable Cost (4,685) Gain From Dechne in Purchasing Power of Net Amounts Owed 8,942 8,942 Net $ 8,073 $ 4,257
- Including no ediustment se met recoverable east. ** At December 31,1983,de current een of net utility Ni5's#**O"n"a"#
ans b We.E * ""*"' D U $ l<? N Ya'n*INeI0'*" Five Year Summary of Selected FinancialDate Adjusted forthe Effects of Changing Pricae Years Ended December 31, 1983 1982 1981 1980 1979 (In Dousands of Averner 1963 Dollers) Operating Revenues $302,45e $297,694 $326,425 $295,794 $254,996 Historical Cost Informatton Adjusted For GeneralIn$ation Income (Ims) From Continuing Operations
- 9,370 5,353 2,248 2,007 6,934 Income (Less) Per Common Share After Preferred Dividend Reqmrements* 1.07 0.17 (0.33) (0.08) 0.96 Net Assets At Year-End At Net Remverable Cost 221,561 194,417 153,583 150,934 149,177 Current Cost Information Income (Ims) From Continuing Operations
- 3,81C (520) (2,938) (I,696) 1,379 Income (Ims) Per Common Share After Preferred Dividend Reqmrenwnts' e.42 (0.61) (1.17) (0.75) (0.18)
Excess Of Increase In General Price Imvel Over Increase in Specde Prices After Adjustment To Net Recoverabic Cost (4,685) (7,389) 5,438 24,023 26,027 Net Assets At Year-End At Net Recovesable Cost 221,561 194,417 153,583 150,934 149,177 Generalinformation Gain From Dechne In Purchasing Power Of Net AmountsOwed 8,942 8,226 18,244 24,122 26,014 Cash Dividends Paid Per Common Share L79 1.75 1.75 1.93 2.20 Market Price Per Common Share At Year End 14.88 14.58 12.47 13.46 16.13 Average Consumer Price index 2ep.4 289.1 272.4 246.8 217.4
*Before Mimsnnent so Net Recoverable Cour.
31
. - - . _ _ _ . _ _ . ~ , .
I i l _ - .- - - l Coneelldeled Operating stodotics I 1980 1979 1978 1973 1983 1982 1981 Years Ended December 31, Energy Generated and Purchased (millions kwh): 1,041 792 660 1,775 2,123 738 940 Generated-by Somerset Station 569 733 1,012 1,011 765 1,819 361 1,865
-by Nuclear Units 1,724 1,632 1.784 1,746 1,795 -
-by Joindy-Owned Units 675 757 706 705 963 482 706 156
-byIjfeof theUnitCentracts (49) (240) (263) (600) (620)
GSS) 410 304 271 laterchange with NEPOOL 240 319 IdB 161 7.J- " Power-Unit Power 3,925 3,930 4,049 4,268 4,333 4,115 4201 TotalGenerseed and F C' " Operating Revenues (thousandt): $104101 8 97,1613 94,217 $ 79,357 $ 63,394 $ 55,731 $ 32,564 RWat 83,519 82,515 67J77 53,012 46,976 21.092 99,228 38,192 32,440 16,837 th=ardal 38,9*1 56,468 60,486 48S31 10,220 6,136 Induetnal 18,289 22,770 18,183 12,435 16J12 9,081 7,886 7,502 7,505 3,669 Other ElectricUtibanes 13,463 10,761 Other 281,902 266,198 269,069 221,734 174,535 152,872 5,441 80,298 4,568 Total Prunary Sales Revenues 22,219 28,862 22,908 11,266 20,848 Unit Contracts
$302,450 $288,417 $297,931 $244,642 $185,801 $158,313 $ 84,8_66 TotalOperatinBRevenues 1,150 1,123 1,083 Energy Sales (mithone of kwhy 1,1F1 1,137 1,122 1,149 1,058 1,052 1,011 792 Residential 1,103 1,044 1,055 848 859 815 865 Commercial 810 772 841 459 Industrial 431 420 398 403 306 365 49 45 Other ElectneUtiboes 38 42 44 34 36 Other 3,517 3,503 3,401 3,244 3,839 3,354 3,487 TotalPrunary Sales 230 226 290 220 201 206 196 Imeses and Company Use 3,729 3,691 3,464 3,731 3,560 3,683 3,747 Total System R _-
586 386 234 466 479 489 585 Unit Contracts 4,333 4,115 3,925 3,930 4,281 4,049 4,268 Total Energy Sales Numberof Customers: 209,673 207,702 205,894 204,221 201,435 198,910 19,781 190,899 20,041 Residential 21,133 20,732 20,380 20,073 21,408 1,213 1,789 C_ M 1,109 1,210 1,213 1,219 1,222 16 15 12 ladustnal 12 18 14 17 Other Electne Utihtnes 30 150 171 258 ' 31 31 34 Other 232,515 230,094 227,887 225,867 222,896 220,090 212,999 Tota 1 Customers 1?! 458 389 315 280 4p6 468 Averste Revenue per Reendential ('n=samar ($) 5,646 5,702 5,474 5,449 5,626 5,708 5,198 Average Use per P *ahtial Customer (kwh) Average Revenue per kwh: 8.40s 6.91d 5.52s 4.96d 3.0ld 8,7tg 8.55d 2.66d Residential 8,89W 7.82# 6.37# 5.04W 4.654 7.99W C-- -2 5.77d 4.44d 3.98d - 1.95d 7.27W 7.318 7.20s fad =nertal k i Y . 32
ConeoNdeted Operating Statistics - General Years Ended December 31, 1983 1962 1981 1989 1979 1978 1973 r apu.um (M) Bonds (Net) 8236,219 $165,950 $155,964 $125,182 3 80,985 $ 81,203 $ 68,786 Other I.mn8-Tens Debt 38,179 33,900 32,500 37,!00 42,500 16,667 3,400 TotalIAa8-Term Debt 256,398 199,850 188,464 162,682 123,485 97,820 72,186 Preferred Stock 4U34 49,536 34,985 35,278 20,686 21,000 15,078 Ceaunce Equity 172,327 140,973 109,875 95,424 93,765 85,842 49,936 Totai r $477,999 $390,359 $333,324 $293,384 $237,936 $204,712 3137,200 ConessasiSharer Dees: Earmn8s per AveraBee<=amaa Share ($) 2.50 2.25 2.03 1.63 1.74 1.92 .97 Dmdends per Share ($) L79 1.70 . 1.60 1.60 1.60 1.60 1.50 Payout (%) 63.9 75.6 78.8 98.2 92.0 83.3 154.6 AveraBe Comunen Shares C-- =- ~ ; 9,062,810 7,519,381 6,123,334 5,525,320 4,871,667 4,266,921 2,784,945 Total ra==an Shares C = ". 10,192,384 8,788,991 6,664,560 5,583,634 5,438,969 4,835,598 2,784,945 Book Value per Share ($) 16.91 16.04 16.49 17.09 17.24 17.75 17.93 Percent Earned On AveraBe Common I:quity(%) 16.2 13.5 12.1 9.5 9.4 10.2 5.3 Market Prices (3): HiBb SSM 14M 12M 13M 15M 17 22M I.mr 13M 11 10 % 10 % 11 % 14 % 19M MisceGewcase(3 he shoessandr) Total ranarruction Frpa=& tures ($) 103,399 77,096 54,436 34,939 30,498 25,948 33,841 Cash C--u A Expenditures ($) 75,912 61,236 41,745 25,024 24,230 22,028 32,250 faternally Generated 1%eds as a 5 of Cash Construction (%) 34.5 20.7 22.5 4.5 26.7 43.2 11.6 Installed ' 'ty- MW 931 927 927 940 996 1,005 836 less: Unit tract Sales - MW 75 70 30 88 88 36 37 System Capability -MW SS6 857 System Peak Demand - MW 847 852 908 969 799 700 680 661 605 677 666 635 Reserve Mar 8in (%) 23.3 26.0 28.1 22.7 34.1 44.2 System Imad Factor (%) 62.3 88.5 59.8 63.6 61.5 62.8 62.7 62.1 Sources of Emery (%): Nacisar 23.5 ' 22.2 20.6 17.0 21.9 22.0 19.5 Coal 163 OR 33.9 77.8 79.4 83.0 78.1 78.0 80.5 Cost of Peel (MiDe Per kwh): Nacisar 6.5 6.3 5.4 4.9 3.5 3.0 2.3 Coal 21.6 OH 41.5 413 47.0 35.3 25.1 18.1 7.7 All Fuels t'a=h==t 38,7 34.1 39.0 30.8 19.6 14.3 6.5 p 33
- - - . . , , . . ~-
P Dividend Reimreatment and System Companies Common Share Purchase Plan Emesern Uemese A=-s a - A Dividend Reinvestment and Conunon EUA Service Ceepeesdien Share Purchase Plan is avadable to all Mensamp E3eedric Company registered shareholders and System One IJberty Square company _ c_ P.O. Box 2333 Participants in the Plan are given a 5% Boston,MA 02107 Ascount on shares purchased with reinvented (617) 357-9590 dividends. 74-- , may also make John F. O. Eachorn, Jr., President 4 additional cash payments as frequently as e once a month topurchase additionalh EmesernIdeen m 110 Mulberry Street with no discount. Opuonal cash payments Brockton,MA 02403 are limited to a maximum of $5,000 per (617) 580 1213 enlaadme quarter and must be received not
- later than the 5th day precedag the . Allan K. h, W Investment Date to be invested in that month. Ps-ha=== VeBoy Elsetric Company The Econonne Recovery Tax Act of 1981 Washington Highway provides special tax treatment to individual Ilocoln, RI02865 shareholders who reinvest their dividends (401) 333-1400 under EUA's Plan.Individualshar= hand-s William R. Bisson, President are eligible to exclude from their income, for Federal income tax purposes, op to $750 annually $1,500 on a joint return) of queh6ed reinvested W The name Eastern UtRities Associates is the Tbe Investment Date for allshases designation of the Trustees for the time beirs Purchased under the Plan is the dmdend undera declarerian of Trust dated AprR 2,
' Payment date for the monthsinwhich 1928, at amended, and a# persons dealing with dividends are payable. For each month in Eastern Utilities Associates must look solely to which a dividend is not payable the Investment the trust property for the enforcement of any Date is the 15th of such month.Tbc pnce of claims against Eastern Utilities Associates as shares purchased is based on the average neither the Trustees,00icers nor Shareholders closing price at EUA sharea for the Bio assume any personalliability for obligations trading days preceding each investment date. enteredinto on behalf of Eastern Utilities Complete details regardag the Plan may Associates.
be obtained by writing: The First N=eiaa=1 Bank of ma=aa= EUA A=ea-ane Dividend Reinvestment Plan P.O. Box 1681 na=eaa . MA 02105 TransferAgent The First NationalBank og na ean P.O. Box 644 Bastan MA02102 (Can-on and Preferred Shares) Bond Trustee State Street Bank and Trust Company 225 Franklin Street Boston,MA02110 (Bondsof allseries) i
- p .
lf l Annual Meednt !- The 1984 Annual Shareholders Meeting will l be held on Monday, April 23, lo84 at 10 a.m. [ In the Board Room on the 33rd Floor at State Street Bank and Trust Company, 225 Franklin Street, Boston, Massachusetts. 34
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l [.E Eastern Utilities Associates
, 1983 FINANCIAL SUPPLEMENT l
EUA System Operating Companies: BlockstoneVcilleyElectric Eastern Edison Company Montaup Electric Company f This booklet has been prepared primarily for institutional Iny'estors and security analysts as a reference source. It is not intended for use in l connection with any sale, or offer to sell, or solicitstion of an offer to buy y ,- any securities. All inquiries should be directed to: ! Donald G. Pardus I Vice President, Treasurer and Chief Financial Officer ! Eastern Utilities Associates
, P.O. Box 2333 Boston, MA 02107 Telephone (617) 357-9500
TABLE OF C@NTENTS 1 EUA System Profile 1 EUA System Companies 2 Rate Relief and Regulation 3 Consolidated Income and Retained Earnings Statements : 4 Consolidated Balance Sheet 5 Consolidated Capitalization 6 Consolidated Statement of Changes in Financial Position 7 Consolidated Operating Statistics 9 Subsidiary Company Income and Retained Earnings Statements 10 Subsidiary Company Balance Sheets 11 Subsidiary Company Statements of Changes in Financial Position 12 Executive Officers 12 Trustees 13 Dividend Reinvestment and Common Share Purchase Plan 13 Transfer Agent and Bond Trustee I l 1 l Legend E Territories served at wholesale E Territories served at retail sm Orack Ar si m.i v m.,as ire. con ,.ar g i Pr.Vid.ac. I i
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EUA System Profile System Comp:nies astern Utilities As- Eastern Utilities Associates E utility holding com-sociates is a public EUA Service Corporation Montaup Electric Company pany with three electric oper- One Liberty Square ating subsidiaries which are P.O. Box 2333 principally engaged in the Boston, MA 02107 generation, purchase, trans- (617) 357-9590 mission, distribution and John F. G. Eichorn, Jr., President sale of electric energy t 233,000 custom :rs covering Eastern Edison Company an area of about 540 squar 110 h1ulberry Street miles. Our retail electne Brockton, MA 02403 companies are Eastern Edison (617) 580-1213 Company operatmg in south-Allan K. Ilamer, President eastern Massachusetts and Blackstone Valley Electric Company Blackstone Valley Electric Washington Highway Company operating in north- Lincoln, RI 02865 ern Rhode Island. Montaup (401) 333-1400 Electric Company supplies William R. Bisson, President clectricity at wholesale to Eastern Edison (its parent), Blackstone and three unaffili-ated utilities for resale. Electric operations accounted for 100% of operating revenues. Approximately 156,000 of our customers are in Massachusetts and 77,000 are in Rhode Island. About 75% of totalconsolidated operating revenues are regu-lated by the Federal Energy Regulatory Commission. Eastern Utilities Associates also owns EUA Service Corporation. EUA Service provides, at cost, various accounting, financial, engineering, planning, data processing and other services for the Association and its Subsidiaries. Together the companics are known as the EUA System. 1
Rate Relief and Regulation The EUA System companies are subject to regulation by the Federal Energy Regulatory Commission (FERC) and by the Massachusetts and Rhode Island Commissions as more fully described below. FERC regulates about 75% of System operating revenues while Massachusetts and Rhode Island regulate about 16% and 9%, respectively. The following table d: tails the rate relief granted for the last two years. Return on Amount Amount Effective Common Test Company Jurisdiction Requested Granted Date Equity Year (Thousands of Dollars) Montaup FERC $ 4,165 $ 4,165* 4/21/82 18.00 % 1982 FERC 18,053 16,767* 1/09/83 18.00 % 1983 FERC 17,400 15,000* 12/28/83 16.20 % 1984 Blackstone R.I. 5,709 3,236 5/20/82 15.50 % 1981 R.I. 5,900 1,600 10/27/83 15.20 % 1982 Eastern Edison Mass. 9,572 4,353 3/03/82 15.25 % 1980 M ass. 10,778 4,503 11/09/82 16.00 % 1981 M ass. 6,200 109 1/31/84 15.25 % 1982
- Granted on a subject-to-refund basis.
Regulatory Commission Highlights a Federal Energy Regulatory a Massachusetts Department of a Rhode Island Public Utilities Commission: Public Utilities: Commission: C Regulates Montaup which accounts a Regulates Eastern Edison which a Regulates Blackstone which for about 75% of System operating accounts for about 16% of System accounts for about 9% of System revenues. operating revenues. operating revenues. O Consists of five members appointed a Consists of three members, a Consists of three members, by the President and confirmed by appointed by the Governor. Com- appointed by the Governor and the Senate. Commissioners serve missioners serve for 4 years. Term confirmed by the Senate. Commis-five-year staggered terms. Chairman runs co-terminous with the sioners serve six-year staggered appointed by the President. Governor. The Chairman is ap- terms. The Chairman is appointed Pointed by the Governor. by the Governor. a Present Commissioners are: Raymond J. O'Connor, Chairman a Present Commissioners are: Paul C. m Present Commissioners are: (term expires 1987); Georgiana Levy (Chairman); Bernice K. Edward F. Burke (Chairman, term Sheldon (term expires 1984); J. McIntyre and Robert J. Keegan. expires 1989), Eleanor Miller , David Hughes (term expires 1984); (term eXPi res 1987) and Mary N. ! e Utilizes historic test period with , Anthony G. Sousa (term expires Kilmarx (term expires 1985). 1 adjustments. a 1984) and Oliver Richard III , (term expires 1985). a Utih,zes histor,c i test period with l m Allows normalization for acceler-
. . ated depreciation, investment tax a@us ments. l 0 Utih.ze pro ected test penod for credits and deferred fuel costs. m Allows normalization for acceler-ated depreciation, investment tax I 0 Allows normalization for acceler- a Permits fuel and purchased power adjustment clauses credits and deferred fuel costs. j ated depreciation and investment
' l,ts f I nd purchased power tax credits. m Does not allow CWIP in rate base.
dfust C Permits construction work in progress (CWIP) in rate base for a Does not allow CWIP in rate base. all pollution control expenditures and up to 50% of other CWIP expenditures. (Montaup CWIP represents about 96% of System CWIP). 2
Consolidated income Statement Years Ended December 31, 1983 1982 1981 1980 1979 1978 1973 (13 Thousands Except Numbers of Shares and Per Share Amounts) Operating Revenues: $302,540* $288,417* $297,931* $244,642 $185,801 $159,195 $ 84,966 Operating Expenses: Fuel 127,898 137,308 164,367 133,120 82,133 56,295 14,238 Purchased Power-Demand 39,560 32,732 28,362 26,383 22,403 21,577 27,190 Oth:r Operation 43,107 40,156 35,128 31,204 28,662 27,330 15,826 Maintenance 7,609 7,852 7,144 6,416 5,153 5,210 3,502 Depreciation and Amortization 14,571 13,379 11,280 9,154 9,729 8,963 5,421 Taxes - Other Than Income 12,950 14,143 14,358 13,560 12,363 13,286 8,907
-Income (Credit) 10,162 6,858 1,854 (3,656) (132) 5,229 (145)
- Deferred (Cred:t) 10,056 4,693 6,604 4,346 2,478 (547) 673 Total Operating Expenses 265,913 257,121 269,097 220,527 162,789 137,343 75,612 Operating Income 36,537 31,296 28,834 24,115 23,012 21,852 9,254 Equity in Earnings of Nuclear Generating Companies 1,331 1,121 928 636 807 679 631 Allowance for Other Funds Used During Construction 12,684 6,657 4,955 2,298 1,608 982 1,591 Other Income and Deductions -Net 751 152 482 117 238 73 55 Incoma Before Interest Charges 51,303 39,226 35,199 27,166 25,665 23,586 11,531 Interest Charges:
Int: rest on Long-Term Debt 29,148 23,760 19,552 11,955 11,401 10,385 4,892 Other Interest Expense 2,691 3,764 7,063 11,779 8,803 5,849 3,328 Allowance for Borrowed Funds Used During Construction (Credit) (11,713) (9,203) (7,736) (7,617) (4,660) (2,937) N;t Interest Charges . 20,126 18,321 18,879 16,117 15,544 13,297 Incoma After Interest Charges 31,177 20,905 16,320 11,049 10,121 10,289 3,312 Pr:ferred Dividends of Subsidiaries 5,813 3,964 3,883 2,059 1,633 1,633 619 Consolidated Net Income $ 25,364 $ 16,941 $ 12,437 $ 8,990 $ 8,488 $ 8,656 $ 2,693 Average Common Shares Outstanding 9,062,810 7,519,381 6,123,334 5,525,320 4,871,667 4,266,921 2,784,945 Consolidated Earnings Per Average Common Share $2.80 $2.25 $2.03 $1.63 $1.74 $2.03 $0.97 Dividends Per Common Share $1.79 $1.70 $ 1.60 $1.60 $1.60 $1.60 $1.50 Consolidated Retained Earnings Statement Years Ended December 31, 1983 1982 1981 1980 1979 1978 1973 (13 Thousands) Consolidated Retained Earnings - Beginning of Year $ 30,396 $ 26,137 $ 23,462 $ 23,291 $ 22,541 $ 21,116 $ 19,459 Consolidated Net Income 25,364 16,941 12,437 8,990 8,488 8,199 2,693 Total 55,760 43,078 35,899 32,281 31,029 29,315 22,152 Dividends Paid-EUA Common Shares 16,029 12,682 9,762 8,793 7,738 6,774 4,177 Miscell:neous Adjustments 26 14 Consolidated Retained Earnings - End of Year $ 39,731 $ 30,396 $ 26,137 $ 23,462 $ 23,291 $ 22,541 $ 17,961
*At December 31,1983, approximauly $23,700,000 of Afontaup's revenue was subject to possible refund. Of this amount, approximately $10,800,000, $11,700,000 and $1,200,000 relate to the years 1983,1982 and 1981, respectively.
Financial information included herein are not intended to represent complete Financial Statements. 3
r Consolidated Balance Sheet December 31, 1983 1982 1981 1980 1979 1978 1973 (Is Thousands) Assets Utility Plant and Other investments: Utility Plant: In Service $374,132 $358,599 $348,255 $333,812 $322,684 $312,601 $214,814 Less Accumulated Provision for Depreciation 125,568 117,396 110,163 101,857 94,618 87,728 58,502 Net Utility Plant in Service 248,564 241,203 238,092 231,955 228,066 224,873 156,312 Construction Work m Progress 249,700 172,057 109,348 82,308 61,493 46,790 29,961 N:t Utility Plant 498,264 413,260 347,440 314,263 289,559 271,663 186,273 Nonutility Property - Net 901 903 903 1,442 1,630 992 104 Investments in Nuclear Generating Companies 9,139 8,313 8,399 7,641 7,401 7,232 7,161 Other Investments (at cost) 69 69 69 69 67 67 67 Total Utility Plant and Other Investments 508,373 422,545 356,811 323,415 298,657 279,954 193,605 Current Assets: Cash 564 299 1,108 1,085 2,187 5,767 5,423 Accounts Receivable: Customers, Net of Reserve 30,831 25,502 29,621 29,011 22,324 20,507 8,331 Accrued Unbilled Revenues 7,440 5,810 6,391 9,501 2,009 Other 3,969 820 667 1,229 879 328 2,150 M;terials and Supplies (at average cost): Fuel 12,899 9,090 6,206 12,486 10,702 3,329 1,833 Plant Materials and Operating Supplies 5,653 5,578 5,311 5,276 4,646 4,217 4,778 Other Current Assets 387 271 446 391 559 337 474 Total Current Assets 61,743 47,370 49,750 58,979 43,306 34,485 24,839 Deferred Debits: Unamortized Debt Expense 5,734 2,170 1,703 795 739 699 346 Extraordinary Property Losses 7,187 10,164 12,860 2,943 2,065 Other Deferred Debits 2,098 7,010 5,697 4,826 3,875 3,562 3,524 Total Deferred Debits 15,019 19,344 20,260 8,564 6,679 4,261 3,870 Total Assets $585,135 $489,259 $426,821 $390,958 $348,642 $318,700 $222,314 Liabilities and Capitalization Capitalization: Common Equity .
$172,327 $140,973 $109,875 $ 95,424 $ 93,765 $ 86,299 .$ 49,935 Non-Redeemable Preferred Stock of Subsidiaries 15,079 15,079 15,079 15,079 15,079 15,079 15,079 Redeemable Preferred Stock of Subsidiaries 34,155 34,457 19,906 20,199 5,607 5,921 Long-Term Debt - Net 256,398 199,850 188,464 162,682 123,485 97,870 72,186 Total Capitalization 477,959 390,359 333,324 293,384 237,936 205,169 137,200 Current Liabilities:
Long-Term Debt Due Within One Year 4,458 13,996 20,770 3,621 Notes Payable 27,100 31,540 63,300 50,450 61,230 Accounts Payable 20,154 25,865 18,534 28,200 13,336 8,780 6,015 Redeemable Preferred Stock Sinking Fund Requirement 309 268 178 305 314 Customer Deposits 1,799 1,880 1,792 1,547 1,270 1,143 712 Taxes Accrued 7,231 3,541 3,467 3,154 2,550 4,051 1,460 Deferred Taxes 3,240 2,445 1,335 3,843 1,739 1,522 Interest Accrued 5,749 6,340 5,898 4,712 2,752 1,926 1,767 Other Current Liabilities 3,537 1,135 996 197 533 1,957 117 Total Current Liabilities 46,477 55,470 59,300 73,498 85,794 90,599 74,923 Deferred Credits: Un:mortized Investment Credit 21,254 13,619 8,053 7,037 10,186 9,673 2,744 l Other Deferred Credits 104 122 37 37 69 336 915 Total Deferred Credits 21,358 13,741 8,090 7,074 10,255 10,009 3,659 Accumulated Deferred Taxes 39,341 29,689 26,107 17,002 14,657 12,923 6,532 Tot:1 Liabilities and Capitalization $585,135 $489,259 $426,821 $390,958 $348,642 $318,700 $222,314 Financialinformation fyluded herein are not intended to represent complete Financial Statements. 4 I
' Consolidated Statement of Capitalization December 31, 1983 1982
' Dollar Amountsin Thousands)
Eastern Utilities Associates: Common Shares:
$5 par value, authorized 12,000,000 shares, outstanding 10,192,304 shares in 1983 and 8,788,991 shares in 1982 $ 50,962 $ 43,945 Other Paid-in Capital 83,406 68,183 Common Shares Expense (1,772) (1,551)
Retained Earnings 39,731 30,396 Total Common Equity 172,327 36.1 % 140,973 36.1 % PreferredStock of Subsidiaries: Non-Redeemable Preferred: Blackstone Valley Electric Company: 4.25 %, $100 par value 35,000 shares (1) 3,500 3,500 5.60%, $100 par value 25,000 shares (1) 2,500 2,500 Premium 129 129 Eastern Edison Company: 4.64%, $100 par value 60,000 shares (1) 6,000 6,000 8.32%, $100 par value 30,000 shares (1) 3,000 3,000 Expense, Net of Premium (50) (50) 15,079 3.2 15,079 3.9 Redeemabic Preferred: Eastern Edison Company: 13.25 %, $100 par value 150,000 shares (1) 15,000 15,000 13.60%, $100 par value (2) 4,800 5,100 15.48%, $100 par value 150,000 shares (1) 15,000 15,000 Expense Net of Premium (331) (329) Sinking Fund and Reacquired Shares (314) (314) 34,155 7.1 34,457 8.8 Long-Term Debt: Eastern Utilities Associates: Senior Notes 10% % due 1999 22,500 22,500 EUA Service Corporation: Notes Payable (Various hiaturities at hioney hiarket rates) 2,000 1,400 Blackstone Valley Electric Company: First hfortgage Bonds: 14% % due 1995 (Series A) 30,000 30,000 Eastern Edison Company: First Afortgage and Collateral Trust Bonds: 3% % due 1983 6,800 7% % due 1983 (second series) 5,000 4% % due 1983 (third series) 2,196 3%% due 1985 6,000 6,000 12% due 1985 (second series) 19,800 19,800 4% % due 1987 3,000 3,000 4%% due 1988 3,000 3,000 14% % due 1990 15,000 15,000 17% % due 1991 30,000 30,000 16% % due 1992 24,000 24,000 4M % due 1993 5,000 5,000 6% % due 1997 7,000 7,000 8% % due 1999 5,090 5,000 7% % duc 2002 8,000 8,000 8%% due 2003 10,000 10,000 12% % due 2013 40,000 Pollution Control Revenue Bonds (3): 10% % due 2008 20,419 Note Payable due 1985 (Prime X 105%) 10,000 10,000 Unamortized Premium 137 150 260,856 213,846 Less Portion Due Within One Year 4,458 13,996 Total 256,398 53.6 199,850 51.2 Total Capitalization $477,959 100.0 % $390,359 100.0 % (15 Authorized and Outstanding. (S) Authori:ed 60.000 shares. Outstanding 48,000 shares in 1983 and $1,000 shares in 1982. (3) Net of $19,381,000 held by Trustee. Financialinformation included herein are not intended to terresent complete Financial Statements. 5
Consolidated Statement of Changes in Financial Position Years Ended December 31, 1983 1982 1981 1980 1979 1978 1973 (Ia Thousands) Source of Funds Internally Generated: Income After Interest Charges $ 31,177 $ 20,905 $16,320 $11,049 $10,121 $10,289 $ 3,312 Principal Non-Cash Charges (Credits) to Income: Depreciation 11,618 11,277 10,876 9,416 9,992 9,592 5,603 Amortization 3,450 3,223 1,376 309 123 210 83 Deferred Taxes 10,056 4,694 6,604 4,346 2,478 1,378 673 Investment Tax Credits, Net 7,635 5,565 1,016 (3,209) (445) 2,751 601 Equityin Undistributed Earnings of Nuclear Generating Companies (753) (500) (464) (16) (169) (161) Allowance for Funds Used During Construction (24,397) (15,860) (12,691) (9,915) (6,268) (3,920) Funds from Operations 38,786 29,304 23,037 11,980 15,832 20,300 10,111 Proceeds from Oil Conservation Adjustment 10,314 Less: Dividends Declared: EUA Common Dividends (16,029) (12,682) (9,762) (8,793) (7,738) (6,774) (4,177) Subsidiary Preferred Dividends (5,813) (3,964) (3,883) (2,059) (1,633) (1,633) (619) Internally Generated Funds 27,258 12,658 9,392 1,128 6,461 11,893 5,315 ExternalSources: Proceeds from Sale of Common Shares 22,239 26,975 11,908 1,668 7,331 9,001 Proceeds from Sale of Bonds- Net 61,019 24,000 30,800 44,200 15,000 Proceeds from Sale of Preferred Stock 15,000 15,000 3,000 Proceeds from Sale of Notes 42,500 Other- Net 5,140 2,418 171 289 959 921 358 Funds from External Sources 88,398 68,393 42,879 61,157 50,790 9,922 18,358 Total Source of Funds $115,656 $ 81,051 $52,271 $62,285 $57,251 $21,815 $ 23,673 Application of Funds Construction Expenditures $103,309 $ 77,096 $54,436 $34,939 $30,498 $25,948 $ 33,841 Less: Allowance for Funds Used During Construction (24,397) (15,860) (12,691) (9,915) (6,268) (3,920) Cash Construction Expenditures 78,912 61,236 41,745 25,024 24,230 22,028 33,841 Decrease (Increase) in Short-Term Notes Payable to Banks 27,100 4,440 31,760 (12,850) 1,400 Retirement of Long-Term Debt 13,996 5,000 5,000 37,637 3,880 Retirement of Preferred Stock 300 300 300 300 Increase (Decrease) in Working Capital 14,663 (10,454) (2,105) (1,695) 7,223 (5,875) (12,096) Other Application - Net 7,785 2,869 2,891 1,896 1,011 382 1,928 TotJ Application of Funds $115,656 $ 81,051 $52,271 $62,285 $57,251 $21,815 $ 23,673 Changes la Components of Working Capital
- Cash $ 264 $ (809) $ 22 $(1,102) $(3,580) $ 1,938 $ (2,689)
Accounts Receivable 10,107 (4,546) (3,062) 14,528 5,258 (822) 2,102 Mat; rials and Supplies 3,884 3,152 (6,246) 2,414 7,802 (2,496) 739 OtherCurrent Assets 117 (176) 56 (165) 227 (229) (31) Accounts Payable 5,711 (7,331) 9,669 (14,867) (4,557) (817) (2,004) Accrued Taxes (3,690) (73) (312) (605) 1,604 (1,177) 645 Other Current Liabilities (1,730) (671) (2,232) (1,898) 469 (2,272) (10,858) Increase (Decrease) in Working Capital $ 14,663 $(10,454) $(2,105) $(1,695) $ 7,223 $(5,875) $(12,096)
*(Excluding Short Term Debt, Current Deferred Taxes and Redeemable Preferred Stock Sinking Fund Requirement)
Financial information included herein are not intended to represent complete Financial Statements. 6
Consolidated Cper; ting Statistics Years Ended December 31, 1983 1982 1981 1980 1979 1978 1973 Energy Generated and Purchased (millions kwh): Gen: rated -by Somerset Station 1,123 738 940 1,041 792 660 1,775
- by Nuclear Units 1,019 861 869 733 1,012 1,011 765
-by Jointly-Owned Units 1,724 1,632 1,784 1,746 1,795 1,865 -
-by Life of the Unit Contracts 452 706 675 757 706 705 963 Interchange with NEPOOL (285) (49) (240) (263) (600) (620) 156 Purchased Power- Unit Power 168 161 240 319 410 304 271 Total Generated and Purchased 4,201 4,049 4,268 4,333 4,115 3,925 3,930 Operating Revenues (thousands):
Residential $104,101 $ 97,161 $ 94,217 $ 79,357 $ 63,394 $ 55,731 $ 32,564 89,225 83,519 82,515 67,377 53,012 46,976 21,092 Commercial 58,901 56,468 60,486 48,931 38,192 32,440 16,837 Industrial 16,212 18,289 22,770 18,183 12,435 10,220 6,136 Other Electric Utilities 13,463 10,761 9,081 7,886 7,502 7,505 3,669 Other Total Primary Sales Revenues 281,902 266,198 269,069 221,734 174,535 152,872 80,298 20,548 22,219 28,862 22,908 11,266 5,441 4,568 Unit Contracts Total Operating Revenues $302,450 $288,417 $297,931 $244,642 $185,801 $158,313 $ 84,866 Energy Sales (millions of kwh): 1,197 1,137 1,122 1,149 1,150 1,123 1,083 Residential 1,103 1,044 1,055 1,058 1,052 1,011 792 Commercial 810 772 841 848 859 815 865 Industdal 386 365 431 420 398 403 459 Other Electric Utilities 34 36 38 42 44 49 45 Other 3,530 3,354 3,487 3,517 3,503 3,401 3,244 Total Primary Sales L.osses and Company Use 201 206 196 230 226 290 220 3,731 3,560 3,683 3,747 3,729 3,691 3,464 Total System Requirements Unit Contracts 470 489 585 586 386 234 466 Total Energy Sales 4,201 4,049 4,268 4,333 4,115 3,925 3,930 Number of Customers: Residential 209,678 207,702 205,894 204,221 201,435 198,910 190,899 21,605 21,133 20,732 20,380 20,073 19,781 20,041 Commercial Industrial 1,189 1,210 1,213 1,219 1,222 1,213 1,789 Other Electric Utilities 12 18 14 17 16 15 12 Other 31 31 34 30 150 171 258 Total Customers 232,515 230,094 227,887 225,867 222,896 220,090 212,999 Average Revenue per Residential Customer ($) 496 468 458 389 315 280 171 Average Use per Residential Customer (kwh) 5,708 5,474 5,449 5,626 5,708 5,646 5,702 A verage Revenue per kwh: Residential 8.70W 8.55W 8.40 6.91( 5.52W 4.96# 3.01W Commercial 8.09W 7.99 7.82 6.37W 5.04 4.65W 2.66# Industrial 7.27W 7.31 7.20 5.77W 4.44W 3.98# 1.95W Financialinformation included herein are not intended to represent complete Financial Statements. 7
Consolidated Operating Statistics - Gener:I Years Ended December 31, 1983 1982 1981 1980 1979 1978 1973 Capitalization: (thousands) Bonds (Net) $226,219 $165,950 $155,964 $125,182 $ 80,985 $ 81,203 $ 68,786 Other Long-Term Debt 30,179 33,900 32,500 37,500 42,500 16,667 3,400 Total Lor.g-Term Debt 256,398 199,850 188,464 162,682 123,485 97,820 72,186 Preferred Stock 49,234 49,536 34,985 35,278 20,686 21,000 15,078 Common Equity 172,327 140,973 109,875 95,424 93,765 85,842 49,936 Total Capitalization $477,959 $390,359 $333,324 $293,384 $237,936 $204,712 $137,200 Common Shares Data: Earnings per Average Common Share ($) 2.80 2.25 2.03 1.63 1.74 1.92 .97 Dividends per Share ($) 1.79 1.70 1.60 1.60 1.60 1.60 1.50 P yout (%) 63.9 75.6 78.8 98.2 92.0 83.3 154.6 Aver:ge Common Shares Outstanding 9,062,810 7,519,381 6,123,334 5,525,320 4,871,667 4,266,921 2,784,945 Tot-1 Common Shares Outstanding 10,192,304 8,788,991 6,664.560 5,583,634 5,438,969 4,835,598 2,784,945 Book Value per Share ($) 16.91 16.04 16.49 17.09 17.24 17.75 17.93 P;rcent Earned On Average Common Equity (%) 16.2 13.5 12.1 9.5 9.4 10.2 5.3 Mirket Prices ($): High 18 % 14 % 12 % 13 % 15 % 17 22 % Low 13 % 11 10 % 10 % 11 % 14 % 19 % Miscellaneous ($in thousands) Tots.1 Construction Expenditures ($) 103,309 77,096 54,436 34,939 30,498 25,948 33,841 Cash Construction Expenditures ($) 78,912 61,236 41,745 25,024 24,230 22,028 32,250 Int:rnally Generated Funds as a % of Cash Construction (%) 34.5 20.7 22.5 4.5 26.7 43.2 11.6 Insttiled Capability- h1W 931 927 927 940 996 1,005 836 i Less: Unit Contract Sales- htW 75 70 80 88 88 36 37 System Capability- htW 856 857 847 852 System Peak Demand - htW 908 969 799 700 680 661 695 677 666 635 Reserve Margin (%) 22.3 26.0 28.1 22.7 3 34.1 44.2 62.3 : System Load Factor (%) 60.8 59.8 63.6 61.5 62.8 62.7 62.1 Sources of Energy (%): ; Nuclear 23.8 22.2 20.6 17.0 21.9 22.0 19.5 Coal 16.3 Oil 59.9 77.8 79.4 83.0 78.1 78.0 80.5 Cost of Fuel (Mills Per kwh): Nuclear 6.5 6.3 5.4 4.9 3.5 3.0 2.3 Coal 21.6 Oil 41.5 41.5 47.0 35.3 25.1 18.1 7.7 All Fuels Combined 30.7 34.1 39.0 30.8 19.6 14.3 6.5 l Financialinforrnation included herein are not intended to represent complete Financial Statements. i 8 I
-.c - - - -
Subsidi:ry income St;t:ments Years Ended December 31, Blackstone Valley Eastern Edison Montaup Electric t (In Thousands) Electric Company Company (A) Company l 1983 1982 1983 1982 1983 1982 Operating Revenues $ 98,153 $ 91,987 $168,690 $156,842 $226,710* $221,045' Operating Expenses: Fuel 127,898 137,308 Purchased Power-Demand 67,934 65,538 119,975 111,961 39,136 32,393 Other Operation 10,242 9,400 19,639 18,792 16,893 15,575 Maintenance 1,720 1,616 2,342 2,560 3,536 3,675 Depreciation and Amortization 2,385 2,242 3,932 3,738 7,679 7,729 Taxes - Other Than Income 6,092 6,194 4,195 5,197 2,654 2,751
-Income 467 1,625 4,968 2,590 4,891 2,642
-Deferred (Credit) 2,151 (1,063) 1,793 1,842 6,112 3,914 Total Operating Expenses 90,991 85,552 156,844 146,680 208,799 205,987 Operating Income 7,162 6,435 11,846 10,162 17,911 15,058 Equity in Earnings of Subsidiaries 23,008 15,431 1,331 1,121 Interest from Associated Company 18,855 13,421 Allowance for Other Funds Used During Construction 182 98 (10) 36 12,512 6,521 Other Income (Deductions)-Net (1) (15) 192 4 417 78 Income Before Int : rest Charges 7,343 6,518 53,891 39,054 32,171 22,778 Interest Charges: .
Interest on Long-Term Debt 4,275 4,275 22,371 17,178 18,855 13,421 Other Interest Expense 150 116 1,022 853 1,491 2,623 Allowance for Borrowed Funds Used During Construction (Credit) (323) (211) (207) (295) (11,183) (8,697) Net Interest Charges 4,102 4,18') 23,186 17,736 9,163 7,347 Income After Interest Charges 3,241 2,338 30,705 21,318 23,008 15,431 Preferred Dividends 289 289 5,525 3,675 Net Income $ 2,952 $ 2,049 $ 25,180 $ 17,643 $ 23,008 $ 15,431 Subsidiary Retained Earnings Statements Years Ended December 31, (in Thousands) Retained Earnings-Beginning of Year $5,348 $4,816 $36,330 $28,488 $19,138 $14,234 Income After Interest Charges 3,241 2,338 30,705 21,318 23,008 15,431 Total 8,589 7,154 67,035 49,806 42,146 29,665 Dividends Paid - Preferred 289 289 5,525 3,675 242 186
- Common 1,639 1,517 11,016 9,801 13,484 10,341 Retained Earnings-End of Year $6,661 $5,348 $50,494 $36,330 $28,420 $19,138
*At December 31,1983 approximately $23,700,000 of Afontaup's revenue was subject to possible refund. Of this amount, approximately $10,800,000 and $ll,700,000 relate to the years 1983 and 1982, respectively.
Note A: Afontaup Electric Company is a wholly-owned subsidiary of Eastern Edison Company. For the purposes of these financial statements Afontaup has not been consolidated with Eastern Edison. Financialinformation included herein are not intended to represent complete FinancialStatements. 9
Subsidiary Balance Sheets December 31, Blackston: Valliy Eastern Edison Montaup Electric (In Thousands) Electric Company Company (A) Company 1983 1982 1983 1982 1983 1982 Assets Utility Plant and Other investments: Utility Plant In Service - $ 79,637 $ 74,490 $126,736 $119,296 $164,540 $162,373 Less Accumulated Provision for Depreciation 21,883 20,608 30,340 28,563 71,729 66,902 Net Utility Plant in Service 57,754 53,882 96,3 % 90,733 92,811 95,471 Construction Work in Progress 4,876 2,229 3,930 3,149 240,894 166,679 Net Utility Plant 62,630 56,111 100,326 93,882 333,705 262,150 Nonutility Property- Net 59 60 821 821 22 22 Investments in Subsidiary Companies (at Equity) 309,330 252,241 9,139 8,313 . Other Investments (at cost) 50 50 Total Utility Plant and Other Investments 62,689 56,171 410,527 346,994 342,866 270,485 Current Assets: Cash 287 13 72 75 145 59 Accounts Receivable: Customers, Net of Reserve 8,695 7,847 16,073 12,873 6,063 4,782 Associated Companies 383 304 6,065 3,915 6,729 7,121 Accrued Unbilled Revenues 2,088 1,507 5,352 4,303 Other 3,384 340 325 248 225 178 Mat: rials and Supplies (at average cost): Fuel 12,899 9,090 Plant Materials and Operating Supplies 1,037 1,085 2,764 2,764 1,853 1,730 Other Current Asssets 14 39 73 59 233 111 Total Current Assets 15,888 11,135 30,724 24,237 28,147 23,071 Deferred Debits: Unamortized Debt Expense 394 427 5,081 1,473 48 46 Extraordinary Property Losses 7,187 10,164 Other Deferred Debits 212 1,711 1,364 2,223 332 2,746 Total Deferred Debits 606 2,138 6,445 3,696 7,567 12,956 ) Total Assets $ 79,183 $ 69,444 $447,696 $374,927 $378,580 $306,512 1 Liabilities and Capitalization l Capitalization: Common Equity $ 25,472 $ 21,159 $169,988 $142,770 $141,548 $132,266 Non-Redeemable Preferred Stock 6,130 6,130 8,949 8,949 1,500 1,500 Red;emable Preferred Stock of Subsidiaries 34,156 34,457 Long-Term Debt - Net 30,000 30,000 203,023 145,950 166,282 118,475 Total Capitalization 61,602 57,289 416,116 332,126 309,330 252,241 j Current Liabilities: i Long-Term Debt Due Within One Year 3,333 13,996 i Accounts Payable - Public 376 327 995 1,126 18,353 23,730 l
- Associated Companies 4,489 1,259 2,586 6,518 566 284 -
Preferred Stock Sinking Fund Requirement 309 268 l Customer Deposits 838 759 961 1,121 Taxes Accrued 2,379 { 3,428 2,263 1,208 2,742 (1,103) ) Deferred Taxes 1,006 726 2,234 1,719 , Interest Accrued 440 356 4,531 5,183 5,842 3,833 ' Other Current Liabilities 24 39 501 1,020 2,945 ! Total Current Liabilities 9,552 6,894 17,713 32,159 30,448 26,744 I Deferred Credits: j Un:mortized Investment Credit 3,147 2,313 5,384 3,366 12,723 7,940 Other Deferred Credits 77 32 27 90 Total Deferred Credits 3,224 2,345 5,411 3,456 12,723 7,940 Accumulated Deferred Taxes 4,805 2,916 8,456 7,186 26,079 19,587 ) Tot:1 Liabilities and Capitalization $ 79,183 $ 69,444 $447,696 $374,927 $378,580 $306,512 I Financialinformation included herein is not intended to represent complete Financial Statements. 10 ! l 1
Subsidiary St~tements of Ch:nges in Fin:nci;I Position Years Ended December 31, Blackstone Valley Eastern Edison Montaup Electric Electric Company Company (A) Company (in Thousands) 1983 1982 1983 1982 1983 1982 Source of Funds Internally Generated: Income After Interest Charges $ 3,241 $ 2,338 $30,705 $21,318 $23,008 $ 15,431 Principal Non-Cash Charges (Credits) to Income: Depreciation 2,385 2,242 3,933 3,738 4,974 4,958 Amortization 33 33 179 142 3,224 3,366 Deferred Taxes 2,151 (1,062) 1,793 1,842 6,112 3,914 Investment Tax Credits, Net 834 780 2,018 1,124 4,782 3,661 Equity in Undistributed Earnings of Subsidiaries (9,282) (4,905) (753) (500) Allowance for Funds Used During Construction (505) (310) (197) (331) (23,695) (15,218) Funds from Operations 8,139 4,021 29,149 22,928 17,652 15,612 Proceeds from Oil Conservation Adjustment 10,314 Less: Dividends Declared: Common Dividends (1,640) (1,517) (11,016) (9,801) (13,485) (10,341) Preferred Dividends (289) (289) (5,525) (3,675) (242) (186) Internally Generated Funds 6,210 2,215 12,603 9,452 14,239 5,085 ExternalSources Proceeds from Sale of Long-Term Debt 60,419 24,000 47,807 24,000 Proceeds from Sale of Preferred Stock 15,000 Proceeds from Capital Contributions 3,000 4,500 13,054 19,871 29,528 Proceeds from Repayment of Montaup Debenture 5,400 Other - Net 1,568 25 893 161 2,592 585 Funds from External Sources 4,568 4,525 74,366 64,432 50,399 54,113 Total Source of Funds $10,778 $ 6,740 $86,974 $73,884 $64,638 $ 59,198 Application of Funds Construction Expenditures $ 8,908 $ 5,597 $10,376 $ 8,436 $83,211 $ 62,408 Less: Allowance for Funds Used During Construction (504) (310) (197) (331) (23,695) (15,218) Cash Construction Expenditures 8,404 5,287 10,179 8,105 59,516 47,190 Decrease in Short-Term Debt 1,500 25,600 Purchase of Montaup Debentures 47,807 24,000 Retirement of Long-Term Debt 14,296 5,400 Ritirement of Preferred Stock 300 300 Capital Contributions to Subsidiary 29,528 Increase (Decrease) in Working Capital 2,374 878 10,828 8,649 1,372 (19,468) Other Application-Net 575 3,564 1,802 3,750 476 Total Application of Funds $10,778 $ 6,740 $86,974 $73,884 $64,638 $ 59,198 Changes in Components of Working Capital
- Cash $ 273 $ (229) $ (4) $ (60) $ 85 $ (433)
Accounts Receivable 4,552 (3,890) 6,476 5,631 935 (12,919) Materials and Supplies (48) 83 195 3,932 2,875 Oth:r Current Assets (25) 7 15 (19) 123 (189) Accounts Payable (3,278) 4,398 4,061 3,249 5,096 (6,246) Accrued Taxes 1,049 543 (1,054) 355 (3,845) 1,182 Other Current Liabilities (149) (34) 1,334 (702) (4,954) (3,738) Increase (Decrease) in Working Capital $ 2,374 $ 878 $10,828 $ 8,649 $ 1,372 $(19,468)
*(Excluding Short-Term Debt, Current Deferred Taxes and Redeemable Preferred Stock Sinking Fund Requirement)
Financialinformation included herein are not intended to represent complete Financial Statements. I1
Trustees Associ; tion Officers Oliver F. Ames (A) John F. G. Eichern, Jr. Director, Fiduciary Trust Company, and President and
. private trustee, Boston, Massachusetts Chief Executive Officer Samuel C. Brown
- Robert E. Maguire Retired Executive Vice President .
1 John E. Conway** Donald G. Pardus ! Chairman, Jack Conway & Co., Inc. Vice President, Treasurer and IIanover, Massachusetts Chief FinancialOfficer Robert I. Dexter (F) Arthur A. Hatch President, Abington Mutual Fire Vice President Insurance Company, Abington, Massachusetts. Robert P. Tassinarl John F. G. Eichorn, Jr. Vice President President and Chief Executive Officer of the Richard M. Burns Association. Comptroller Peter B. Freeman (A, P) William F. O'Connor Business and financialconsultant Providence, Rhode Island. SCC**'Y Nathan H. Garrick, Jr. (C, F) Retired Robert E. Maguire Executive Vice President of the Association. Wesley W. Marple, Jr. (P) Professor of Finance, Northeastern University, Boston, Massachusetts Donald G. Pardus Vice President, Treasurer and Chief Financial ) Officer of the Association. l Margaret M. Stapleton (C, F) Second Vice President, John Hancock Mutual Life Insurance Company, Boston, Massachusetts D. Reid Weedon, Jr. (A, C) Senior Vice President, Arthur D. Little, Inc. I Cambridge, Massachusetts. l
- Resigned Efective December 31,1983
" Elected Efective January 1,1984 A-indicates member of Audit Committee l C-indicates member of Compensation and Nominating Committee F-Indicates member of Finance Committee P-Indicates member of Pension Trust Committee l
l 12
Dividend Reinvestment cnd TransferAgent Common Share Purchase Plan He First National Bank of Boston A Dividend Reinvestment and Common P.O. Box 644 Share Purchase Plan is available to all Boston, MA 02102 registered shareholders and System (Common and Preferred Shares) company employees. Bond Trustee Participants in the Plan are given a 5% discount on shares purchased with reinvested State Street Bank and Trust Company 225 Franklin Street dividends. Participants may also make B st n, MA 02110 additional cash payments as frequently as once a month to purchase additional shares (Bonds of all series) with no discount. Optional cash payments are limited to a maximum of $5,000 per calendar quarter and must be received not liter than the 5th day preceding the Investment Date to be invested in that month. The Economic Recovery Tax Act of 1981 provides special tax treatment to individual shareholders who reinvest their dividends The name Eastern Utilities Associates is the under EUA's Plan.Individualshareholders designation of the Trustees for the time being are eligible to exclude from their income, for under a declaranon of Trust dated April 2, Federalincome tax purposes, up to $750 , 1928, a amended, and all persons dealing with annually S1,500 on a joint return) oi Eastern Utilities Associates must look solely to qualilled reinvested dividends. TheInvestment Date for all shares the trust property for the enforcement of any claims against Eastei : Utilities Associates as purchased under the Plan is the dividend neither the Trustees,0ficers nor Shareholders psyment date for the months in which dividends are payable. For each month in assume any personalliability for obligations which a dividend is not payable the Investment enteredinto on behalf of Eastern Utilities D:te is the 15th of such month. The price of Associates. shares purchased is based on the average closing price of EUA shares for the five trading days preceding each investment date. Complete details regarding the Plan may be obtained by writing: AnnualMeeting The First National Bank of Boston The 1984 AnnualShareholders Meeting will EUA Automatic Dividend be held on Monday, / pril 23,1984 at 10 a.m. Reinvestment Plan in the Board Room on the 33rd Floor at P.O. Box 1681 State Street Bank and Trust Company, Boston, MA 02105 225 Franklin Street, Boston, Massachusetts. 13 i
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