ML19323A404: Difference between revisions
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{{#Wiki_filter:- - - - - - | {{#Wiki_filter:- - - - - - | ||
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y y | |||
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; | ; | ||
3 ; - | 3 ; - | ||
y QU LF STATES!UTI, LIT.IES 1979 AN N UAL REPORTg&! 1; m - | y QU LF STATES!UTI, LIT.IES 1979 AN N UAL REPORTg&! 1; m - | ||
is. .. . | is. .. . | ||
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.w.+,. . | .w.+,. . | ||
n.g., 4 | n.g., 4 e ..,, | ||
e ..,, | |||
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: y. ~ | : y. ~ | ||
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oa.- | oa.- | ||
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.. v .> > . ;e . . - | .. v .> > . ;e . . - | ||
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g ._ | g ._ | ||
o.Q>.. - ., | o.Q>.. - ., | ||
,~ . ... | ,~ . ... | ||
: m. r . - .. . . | : m. r . - .. . . | ||
c.v. | c.v. | ||
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* *: ' . ,s y | |||
s _e | |||
,._; , _ | ,._; , _ | ||
.2 c. : | .2 c. : | ||
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y | y | ||
* y. | * y. | ||
,) | ,) | ||
. ue | . ue | ||
.g n . :n ' .' - .. | .g n . :n ' .' - .. | ||
3 | 3 p.. | ||
p.. | |||
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: l. .9' - | : l. .9' - | ||
p | p | ||
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+ | + | ||
< ,;,, . | < ,;,, . | ||
.,.w . . | .,.w . . | ||
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| Line 136: | Line 71: | ||
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g@% ' W,+ . . gx | g@% ' W,+ . . gx | ||
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^ ~ y~ % k.-.g, _, | ^ ~ y~ % k.-.g, _, | ||
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y g,g.. e | y g,g.. e | ||
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%,. ; h, ,"f . ,. . | %,. ; h, ,"f . ,. . | ||
3 - .[ s '( - | |||
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, ,~. | , ,~. | ||
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9 g /y ; * '' - | 9 g /y ; * '' - | ||
9 | 9 | ||
'a | 'a d-gg. | ||
S F | |||
d- | |||
gg | |||
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F | |||
4 | 4 | ||
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;,j y | ;,j y | ||
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, . , , pg., . | , . , , pg., . | ||
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o- - ..- > | o- - ..- > | ||
.cy s. g,,ty, . p.. : | .cy s. g,,ty, . p.. : | ||
g *+A. ,*e | g *+A. ,*e | ||
., c , .,.,_,. | ., c , .,.,_,. | ||
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n .e.xn | |||
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. .s . E' mI ./ ., '# | . .s . E' mI ./ ., '# | ||
1 y.. ,.<n.. | 1 y.. ,.<n.. | ||
, , , . ,, l | , , , . ,, l | ||
,m | ,m | ||
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, g.. _ | , g.. _ | ||
* +' - | * +' - | ||
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'f .,.. _ | 'f .,.. _ | ||
'..J,.4 | '..J,.4 | ||
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| Line 403: | Line 183: | ||
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s | |||
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p, . v .- ....\. | p, . v .- ....\. | ||
g l 1 | g l 1 | ||
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, . . s .. ~. s %, .._ .: . . . . ,r .~ | , . . s .. ~. s %, .._ .: . . . . ,r .~ | ||
li"[ . | li"[ . | ||
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~ - * - - - | ~ - * - - - | ||
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*- . .. . . s- | |||
n . | |||
nv ''~. + . . N.- | nv ''~. + . . N.- | ||
-l 1 | -l 1 | ||
--assummywr-+ - - - - v - | --assummywr-+ - - - - v - | ||
e ~ y ..g - - | e ~ y ..g - - | ||
| Line 518: | Line 238: | ||
.' MQ'., j | .' MQ'., j | ||
" .. .. ; G'.. | " .. .. ; G'.. | ||
, g ..] w ' . ., l l | , g ..] w ' . ., l l | ||
?. ' | ?. ' | ||
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< ' ' g, Q g, on,. | < ' ' g, Q g, on,. | ||
. s[ w, _1 , 3.,.. i y3 | . s[ w, _1 , 3.,.. i y3 | ||
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| Line 548: | Line 256: | ||
l - | l - | ||
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[. | [. | ||
. . M*J | . . M*J | ||
: c. c | : c. c | ||
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: w. .. | : w. .. | ||
. Q | . Q | ||
. , m | . , m | ||
,h. | ,h. | ||
* ~$e;w$ : 64 _ | * ~$e;w$ : 64 _ | ||
Mk ..m.*.. ..w. | Mk ..m.*.. ..w. | ||
.s q. | .s q. | ||
'. Wy | '. Wy | ||
_l''%, ',.~ | _l''%, ',.~ | ||
. 3> a, ' '" ! | . 3> a, ' '" ! | ||
f . :L )A- & .- ?' | f . :L )A- & .- ?' | ||
g | g | ||
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T,'. | T,'. | ||
| Line 595: | Line 279: | ||
". [' J. | ". [' J. | ||
[ ' . ' ' ,,j- [?. * | [ ' . ' ' ,,j- [?. * | ||
' ^ | ' ^ | ||
i " | i " | ||
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c- . . | c- . . | ||
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: k. - . . . . | : k. - . . . . | ||
* y .1 g, . h. | * y .1 g, . h. | ||
f(k %.m#'p ' ., $'p;.",. .. I | f(k %.m#'p ' ., $'p;.",. .. I | ||
.L .> . | .L .> . | ||
'f , A - | 'f , A - | ||
~ y, . ;**% ' - | ~ y, . ;**% ' - | ||
k, ' | k, ' | ||
, 9.j{.gs ' "'.f.# - . g .. | , 9.j{.gs ' "'.f.# - . g .. | ||
3 . ee g. | 3 . ee g. | ||
W. ?.M$ 8 kill({y u..I,. & ' | W. ?.M$ 8 kill({y u..I,. & ' | ||
d.1,., ,,$ %C d % '' | d.1,., ,,$ %C d % '' | ||
, f.f' R- Q. . | , f.f' R- Q. . | ||
5y w5 JglG. G ~ | 5y w5 JglG. G ~ | ||
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* g;iWi | * g;iWi | ||
\ | \ | ||
_~~ . | _~~ . | ||
r, ;:1 EpNSD. w- (e "l . . : | r, ;:1 EpNSD. w- (e "l . . : | ||
~ | ~ | ||
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.t m' , .. | .t m' , .. | ||
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., .. y'f .. ,. | ., .. y'f .. ,. | ||
m | m w' | ||
w | |||
- } 3-y g+c,? T *' | - } 3-y g+c,? T *' | ||
%.g * | %.g * | ||
.y yh--%. a , | .y yh--%. a , | ||
; .L' s ppat . . - + - | ; .L' s ppat . . - + - | ||
. ,W - . -/ | . ,W - . -/ | ||
,- r s | ,- r s | ||
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; | ; | ||
- g , .'r f . | - g , .'r f . | ||
W | W | ||
~ | ~ | ||
: f. [g)y[ Y " . Y, . , ' | : f. [g)y[ Y " . Y, . , ' | ||
t, J | t, J | ||
,+' ' . . , - :- - | ,+' ' . . , - :- - | ||
..w.... | ..w.... | ||
e 5 4 ' g. | e 5 4 ' g. | ||
5 3* | 5 3* | ||
| Line 697: | Line 332: | ||
, . f; !* | , . f; !* | ||
.f, 'p | .f, 'p | ||
./ | ./ | ||
K }gl.? | K }gl.? | ||
N - | N - | ||
s | s | ||
. - 1 | . - 1 | ||
',;'" , ., ,L- %. g y'> - | ',;'" , ., ,L- %. g y'> - | ||
' , i p- > . | ' , i p- > . | ||
ll: | ll: | ||
[. -:' f.,, R l | [. -:' f.,, R l | ||
-[. 3y_ . | -[. 3y_ . | ||
w ...l | w ...l | ||
., ; . , . , | ., ; . , . , | ||
/ .2 | / .2 | ||
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~.].M. . . - ., . q 7 | |||
~.].M. . . - ., . q | |||
7 | |||
.w.. | .w.. | ||
? - - - | ? - - - | ||
,,. e .n , 7 | ,,. e .n , 7 | ||
,f.. ., | ,f.. ., | ||
' ' . Q- g.9,t b,.m . | ' ' . Q- g.9,t b,.m . | ||
.,,p 4'.[ ,. y e ,*'~ 1 | .,,p 4'.[ ,. y e ,*'~ 1 | ||
....s* ._ .. A i * - . | ....s* ._ .. A i * - . | ||
.s- .- . - | .s- .- . - | ||
| Line 753: | Line 360: | ||
~ | ~ | ||
.j.9 . . , . ;, | .j.9 . . , . ;, | ||
~,g , | ~,g , | ||
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g; Q, . | g; Q, . | ||
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; .c.t | ; .c.t | ||
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a.xT, | |||
s | |||
^ | ^ | ||
-l' . | -l' . | ||
| Line 778: | Line 372: | ||
.,.g ( | .,.g ( | ||
! W (! | ! W (! | ||
,*.esg g $ | ,*.esg g $ | ||
f . | f . | ||
: g. '*l | : g. '*l | ||
* j, ? ./_ | * j, ? ./_ | ||
l | l | ||
.'.. ,3. * . v. e | .'.. ,3. * . v. e | ||
< . . , ,g* k .', ./'8 .~.$' M .. W. . - ''' 4 "' ' | < . . , ,g* k .', ./'8 .~.$' M .. W. . - ''' 4 "' ' | ||
- k - [ h, ' .:, ". ' . , | - k - [ h, ' .:, ". ' . , | ||
r ', L | r ', L | ||
~- | ~- | ||
f_ g y- *' H n.. '? .. .. | f_ g y- *' H n.. '? .. .. | ||
, f | , f | ||
. l - | . l - | ||
. : ^ [J . . . , | . : ^ [J . . . , | ||
.. ".? | .. ".? | ||
}Q ' | }Q ' | ||
| Line 818: | Line 392: | ||
'*,g. ' 'I Q; ' | '*,g. ' 'I Q; ' | ||
'.. '.& k W.g | '.. '.& k W.g | ||
: g. -- - | : g. -- - | ||
,z.. . | ,z.. . | ||
; .- 4 ' | ; .- 4 ' | ||
: . . . f i - - e : , ' ; Rj'. '' | : . . . f i - - e : , ' ; Rj'. '' | ||
4 4 .o , *;%.] . ,4. .:', | 4 4 .o , *;%.] . ,4. .:', | ||
' .i , ' g ,' - | ' .i , ' g ,' - | ||
4 n gs * ' 8 - | 4 n gs * ' 8 - | ||
2+[ ;*gg-j | 2+[ ;*gg-j | ||
... ,1 | ... ,1 | ||
? - | ? - | ||
]q., sg. | ]q., sg. | ||
, .- "7.p . ... y | , .- "7.p . ... y | ||
, v. .y . ~ . . , ;- .g. | , v. .y . ~ . . , ;- .g. | ||
, 5 . , | , 5 . , | ||
.. ,. 4 ,e .a | .. ,. 4 ,e .a | ||
-'s i | |||
-'s | |||
i | |||
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4 _ | 4 _ | ||
, M ,. g. . | , M ,. g. . | ||
-._n | -._n | ||
, . . , 7, , . | , . . , 7, , . | ||
7 - ' ' ' | 7 - ' ' ' | ||
.j '. b | .j '. b | ||
,,yy 1 | ,,yy 1 | ||
.. 5 | .. 5 j*- | ||
j*- | |||
[' .'. . | [' .'. . | ||
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.. a 7 . | |||
.. a | |||
7 | |||
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d, . ' .' .. | d, . ' .' .. | ||
4 }, | 4 }, | ||
e . - ' | e . - ' | ||
1 ' .- , 'v -y . : . v | 1 ' .- , 'v -y . : . v | ||
. . ;. : | . . ;. : | ||
s | s | ||
. . .m , ,. 4 ,g.. | . . .m , ,. 4 ,g.. | ||
.J.,',,. | .J.,',,. | ||
.y ? | .y ? | ||
s | s | ||
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: - :- , ;, - .w g - , , . '. ,- | : - :- , ;, - .w g - , , . '. ,- | ||
g..C '- p * | g..C '- p * | ||
% ~,.- . | % ~,.- . | ||
U | U | ||
^ f^ . ''h, ' | ^ f^ . ''h, ' | ||
' ..; | ' ..; | ||
i ' J''' | i ' J''' | ||
m ' car,' | m ' car,' | ||
..I ' | ..I ' | ||
'[, ' '. ' " r. ,; | '[, ' '. ' " r. ,; | ||
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. s n m f.q ; ,. , y v 2 ,, - . .w 3 . | |||
. s | |||
n m f.q ; ,. , y | |||
v 2 ,, - . .w 3 | |||
f. | f. | ||
; e. . . | ; e. . . | ||
.%g', ,- | .%g', ,- | ||
. g,* Ws' d ' ..'. .. | |||
. g,* Ws' | "g, z .y - | ||
d ' ..'. . | |||
"g, | |||
z .y | |||
V,g.y.' . .3; | V,g.y.' . .3; | ||
, .g : | , .g : | ||
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. 'l | . 'l | ||
'D. , ' , | 'D. , ' , | ||
a I | a I | ||
t E | t E | ||
| Line 997: | Line 462: | ||
3 | 3 | ||
, ' . " .p, .. # | , ' . " .p, .. # | ||
_ . . ,, %w $e - - | _ . . ,, %w $e - - | ||
g 4 | g 4 | ||
...,g; . , | ...,g; . , | ||
'.4 | '.4 dM | ||
dM | |||
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s - | s - | ||
.c . . - | .c . . - | ||
: g. - ' | : g. - ' | ||
,^ :y ; ng ' . | ,^ :y ; ng ' . | ||
a J. . | a J. . | ||
f;4 y | |||
y, _. s | |||
f;4 | |||
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'? About the Photographs . . | '? About the Photographs . . | ||
ing o smess sad objectivea fmm ef. | ing o smess sad objectivea fmm ef. | ||
| Line 1,116: | Line 508: | ||
Jheir efhues ammke up she phoeography of slus | Jheir efhues ammke up she phoeography of slus | ||
'. . amamal suport =1e te -e of omcers | '. . amamal suport =1e te -e of omcers | ||
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pesaums. .c .,...n | |||
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- - -- .~- -- .. - - - . ?-w T Page 2 ...Machael Wallwe, Couroc Page 6 ... Henry Joyner. Be.wmeant | |||
- Pepe 7 .., Anna Raysiond. Lake Charles Page 9 ... Andy Dreher. St. Francisville | |||
- - -- .~- -- .. - - - . ?-w T Page 2 ...Machael Wallwe, Couroc | |||
Page 6 ... Henry Joyner. Be.wmeant | |||
- Pepe 7 .., Anna Raysiond. Lake Charles | |||
Page 9 ... Andy Dreher. St. Francisville | |||
' Page 10.7.Bo Hamson.Conroe A{_~ *~ - | ' Page 10.7.Bo Hamson.Conroe A{_~ *~ - | ||
Page ll ...Bu Hamson. Conroe | Page ll ...Bu Hamson. Conroe | ||
' Page 12.. Joe Russian. Re=snoni d Description of the Business ausf sans utenes camp.my,- | ' Page 12.. Joe Russian. Re=snoni d Description of the Business ausf sans utenes camp.my,- | ||
:in henn===#, Texas, is engaged pnacapaHy in the business of generating, transmitung and &stri-butang electric caergy to 483,000 cussoniers in Southeast Texas and South Louisiane. Its 28.000 square-mile service area extends morne 4 ,. . 350 amies acunes the cesssal areas of the two | :in henn===#, Texas, is engaged pnacapaHy in the business of generating, transmitung and &stri-butang electric caergy to 483,000 cussoniers in Southeast Texas and South Louisiane. Its 28.000 square-mile service area extends morne 4 ,. . 350 amies acunes the cesssal areas of the two | ||
. . , , senses and includes the cities of Bacon Rouge g7 and take Qades, I a==iaan, and n,.-=,=n. | . . , , senses and includes the cities of Bacon Rouge g7 and take Qades, I a==iaan, and n,.-=,=n. | ||
| Line 1,154: | Line 531: | ||
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| Line 1,284: | Line 628: | ||
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| Line 1,312: | Line 645: | ||
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| Line 1,320: | Line 652: | ||
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5 Le/2 s.r N_ | 5 Le/2 s.r N_ | ||
1979 1978 'I Change Financial Highlights Income Applicable to Common Stock (coon S 68,559 $ 59,156 15.9 Earnings per Share of Common Stock Based on Average Shares Outstanding $ 1.74 $ 1.73 .6 l Assuming Conversion of Convertible Debentures $ 1.65 $ 1.62 1.9 I Dividends per Share $ 1.36 $ 1.24 9.7 Average Common Shares Outstanding noo) 39,310 34,265 14.7 Total Operating Revenue nxos $864,338 $717,958 20.4 Operating Expenses and Taxes nxo) $749,028 $613,523 22.1 Number of Electric Customers 483,195 466,139 3.7 Total Kilowatt.llour Sales gn)) 29,741,949 28,891,531 2.9 System Peak Load - Kilowatts 5,229,300 5,137,700 1.8 I | |||
1979 1978 'I Change Financial Highlights Income Applicable to Common Stock (coon S 68,559 $ 59,156 15.9 Earnings per Share of Common Stock | |||
Based on Average Shares Outstanding $ 1.74 $ 1.73 .6 l Assuming Conversion of | |||
Convertible Debentures $ 1.65 $ 1.62 1.9 I Dividends per Share $ 1.36 $ 1.24 9.7 Average Common Shares Outstanding noo) 39,310 34,265 14.7 Total Operating Revenue nxos $864,338 $717,958 20.4 Operating Expenses and Taxes nxo) $749,028 $613,523 22.1 Number of Electric Customers 483,195 466,139 3.7 Total Kilowatt.llour Sales gn)) 29,741,949 28,891,531 2.9 System Peak Load - Kilowatts 5,229,300 5,137,700 1.8 I | |||
], PERCENTAGE INCREASE IN CONSUMER PRICES January 1970 thru November 1979 | ], PERCENTAGE INCREASE IN CONSUMER PRICES January 1970 thru November 1979 | ||
." Medical Care | ." Medical Care Transportation l Electricity y | ||
Transportation l Electricity y | |||
.-ce-c l | .-ce-c l | ||
Mi . | Mi . | ||
. Tc.; _; , G: | . Tc.; _; , G: | ||
'" g ' | '" g ' | ||
i | i | ||
; i-Source: t!.S. Bureau of tatur Stansues. MontMy Lo/w Reww. except for "Electncity" whrh indrates Gulf States Untites average residenual pnce per kilowatt-hour I | |||
; i- | |||
Source: t!.S. Bureau of tatur Stansues. MontMy Lo/w Reww. except for "Electncity" whrh indrates Gulf States Untites average residenual pnce per kilowatt-hour I | |||
J. | J. | ||
I | I | ||
I . i l | I . i l | ||
l | l i | ||
i | |||
I | I | ||
; | ; | ||
| Line 1,403: | Line 696: | ||
income and dividends increased in of the plant. When these groups start 1979. Revenues were up significantly. funding the project this year, GSU's { | income and dividends increased in of the plant. When these groups start 1979. Revenues were up significantly. funding the project this year, GSU's { | ||
l Earnings per share of common stock capital needs for construction of this i increased slightly to $1.74 as compared unit will be materially reduced. l to $1.73 in 1978 when there were 13 } | l Earnings per share of common stock capital needs for construction of this i increased slightly to $1.74 as compared unit will be materially reduced. l to $1.73 in 1978 when there were 13 } | ||
percent fewer shares outstandmg. In a similar arrangement, Sam l l In 1980 the company will benefit _L Rayburn Dam Electric Cooperative l from a $20.8 million Texas rate increase and the company are negotiating Sam l which went into effect in November, Rayburn's acquisition of 30 percent and the resolution of three other rate of the $450 million,540 megawatt i increase filings that should be acted Nelson No. 6 coal unit scheduled for i upon by regulatory bodies during the completion near Lake Charles, La., , | |||
percent fewer shares outstandmg. In a similar arrangement, Sam l l In 1980 the company will benefit _L Rayburn Dam Electric Cooperative l from a $20.8 million Texas rate increase and the company are negotiating Sam l which went into effect in November, | |||
Rayburn's acquisition of 30 percent and the resolution of three other rate of the $450 million,540 megawatt i increase filings that should be acted Nelson No. 6 coal unit scheduled for i upon by regulatory bodies during the completion near Lake Charles, La., , | |||
year. The three include'a request pend- in 1982. | year. The three include'a request pend- in 1982. | ||
l ing before the Federal Energy Regula- Additionally,I am pleased to report j tory Commission (FERC) for a $1.2 that the company's last oil / gas fired ! | l ing before the Federal Energy Regula- Additionally,I am pleased to report j tory Commission (FERC) for a $1.2 that the company's last oil / gas fired ! | ||
| Line 1,412: | Line 702: | ||
Additionally, we have filed with the Earnings per share did not show the Louisiana Public Service Commission expected increase in 1979 for a number (LPSC) for a $3.4 million revenue of reasons. Our service area experi-increase from our 84.000 Baton Rouge, enced an unusually cool summer,15 i La., area gas customers; and for a $98.9 percent cooler than 1978 and nine per-million annual revenue increase from cent cooler than normal. Conservation our 240.000 Louisiana electricity efforts also are beginning to have per-customers. ceptible effect on sales. The most The Louisiana electric request important consideration, however, is includes a motion asking for a $27.3 the high rate ofinflation w hich million interim increase based on a level of earnings previously authorized NET INCOME by the Louisiana commission, but the ! | Additionally, we have filed with the Earnings per share did not show the Louisiana Public Service Commission expected increase in 1979 for a number (LPSC) for a $3.4 million revenue of reasons. Our service area experi-increase from our 84.000 Baton Rouge, enced an unusually cool summer,15 i La., area gas customers; and for a $98.9 percent cooler than 1978 and nine per-million annual revenue increase from cent cooler than normal. Conservation our 240.000 Louisiana electricity efforts also are beginning to have per-customers. ceptible effect on sales. The most The Louisiana electric request important consideration, however, is includes a motion asking for a $27.3 the high rate ofinflation w hich million interim increase based on a level of earnings previously authorized NET INCOME by the Louisiana commission, but the ! | ||
.m nullens) company has been unable to reach this levellargely because of rapidly esca- , | .m nullens) company has been unable to reach this levellargely because of rapidly esca- , | ||
lating costs. | lating costs. | ||
Another major event in 1979 that creates positive expectations for 1980 centers on the partnership arrangement | Another major event in 1979 that creates positive expectations for 1980 centers on the partnership arrangement | ||
| Line 1,419: | Line 708: | ||
l Lights come on at the Lewis Creek Generating l Plant near Conroe, Tesas. In the centerfore-l ground is she cochng mater canalfor theplant. | l Lights come on at the Lewis Creek Generating l Plant near Conroe, Tesas. In the centerfore-l ground is she cochng mater canalfor theplant. | ||
l 3 | l 3 | ||
t l | t l | ||
l l | l l | ||
| Line 1,431: | Line 717: | ||
l first mongage bonds. This removes the permit us to enter the new decade with [ | l first mongage bonds. This removes the permit us to enter the new decade with [ | ||
I limit of 51 billion for the aggregate the firm conviction that GSU,in the l value of bonds outstanding. long term, will be able to provide reli-l able electric service at reasonable costs l l and to maintain a good record of Qur preferred stock and first mort-l N./ gage bonds were downrated by earnings. | I limit of 51 billion for the aggregate the firm conviction that GSU,in the l value of bonds outstanding. long term, will be able to provide reli-l able electric service at reasonable costs l l and to maintain a good record of Qur preferred stock and first mort-l N./ gage bonds were downrated by earnings. | ||
Standard and Poor's and Moody's. He changes can be viewed basical- l | Standard and Poor's and Moody's. He changes can be viewed basical- l Both rating services cited our expen- ly as a two-year reorganization of the sive, but necessary construction pro- management structure. Panicular empha- , | ||
Both rating services cited our expen- ly as a two-year reorganization of the sive, but necessary construction pro- management structure. Panicular empha- , | |||
gram- 5400 million this year alone - sis was placed on building an organiza- l tion to cope with the new and rapidly i and uncenainty concerning rate relief from the Louisiana commission changing demands placed on an elec- [ | gram- 5400 million this year alone - sis was placed on building an organiza- l tion to cope with the new and rapidly i and uncenainty concerning rate relief from the Louisiana commission changing demands placed on an elec- [ | ||
as prime reasons for the downrating. tric utility such as Gulf States and on j The lower ratings translate into higher developing systems and procedures to i interest rates and preferred dividends reduce costs. It was also necessary to ! | as prime reasons for the downrating. tric utility such as Gulf States and on j The lower ratings translate into higher developing systems and procedures to i interest rates and preferred dividends reduce costs. It was also necessary to ! | ||
which must be paid ultimately by our increase our ability to communicate l more effectively with r.ll segments of ; | which must be paid ultimately by our increase our ability to communicate l more effectively with r.ll segments of ; | ||
customers. | customers. | ||
Fortunately, there are indications the the public and to recognize and deal l | Fortunately, there are indications the the public and to recognize and deal l leuisiana commission is moving away with energy problems more from holding rates at unreasonably low expeditiously. | ||
leuisiana commission is moving away with energy problems more from holding rates at unreasonably low expeditiously. | |||
levels and taking a full year to act on To meet the financial and regulatory I | levels and taking a full year to act on To meet the financial and regulatory I | ||
rate requests This is evidenced by the challenges of the 1980's, our financial rate increase granted to GSU and put organization was restructured with i | rate requests This is evidenced by the challenges of the 1980's, our financial rate increase granted to GSU and put organization was restructured with i | ||
into effect January :,1979, which was Accounting, Finance, Rates and Plan-l ning consolidated under an executive then the largest ever granted an electric utility by the LPSC, and by other rulings vice president. Pan of this restructur-handed down by the commission in ing led to annual savings of 5600.000 1979 concerning other electric utilities. by improving cash management w hile | into effect January :,1979, which was Accounting, Finance, Rates and Plan-l ning consolidated under an executive then the largest ever granted an electric utility by the LPSC, and by other rulings vice president. Pan of this restructur-handed down by the commission in ing led to annual savings of 5600.000 1979 concerning other electric utilities. by improving cash management w hile EAILNINGS PER SilARE , | ||
l Based on Average Shares Outstanding 4 - f. , | |||
EAILNINGS PER SilARE , | |||
l Based on Average Shares Outstanding | |||
4 - f. , | |||
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| Line 1,508: | Line 756: | ||
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| Line 1,524: | Line 767: | ||
,N | ,N | ||
- c. . . , m .. .. | - c. . . , m .. .. | ||
.D,N x . V , 'e | .D,N x . V , 'e b$ f.gg ., # ''''- . - ' | ||
b$ f.gg ., # ''''- . - ' | |||
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@$] i?[ .f { ;.^..p- }.? s{ | @$] i?[ .f { ;.^..p- }.? s{ | ||
1975 1976 1977 1978 1979 4 | |||
1975 1976 1977 1978 1979 | |||
4 | |||
I River Bend unit, which willbe built with total dedication to safety, must be short-terminvestments added more organizationally positioned to provide than $200,ro0 to cash earnings in 1979. , | I River Bend unit, which willbe built with total dedication to safety, must be short-terminvestments added more organizationally positioned to provide than $200,ro0 to cash earnings in 1979. , | ||
Development of an internal capability thatthebesteffonsof thecompany | Development of an internal capability thatthebesteffonsof thecompany in the area of rate design and cost and of its panners are brought to bear on l | ||
in the area of rate design and cost and of its panners are brought to bear on l | |||
service studies brought a savings ofthe project. To accomplish this,theRiver , | service studies brought a savings ofthe project. To accomplish this,theRiver , | ||
Ben t | Ben t | ||
| Line 1,554: | Line 783: | ||
plant on schedule. r plexity of fuel pricing and purchasing ; | plant on schedule. r plexity of fuel pricing and purchasing ; | ||
buik power supplies, a Power Supply | buik power supplies, a Power Supply | ||
. Department within System Operations Administrative l'1 revamped andServices now provide weremajor l was developed.The depanment con-tributed to a 50 percent reduction in cost savings for the company. For l the use of fuel oil -our most expen- example, a Risk Management Depan-in 1979. ment has improved insurance rates the sive fuel company pays to the point that $1.25 The accomplishments of 197 The Consumer Services staff was million is saved annually. Materials | . Department within System Operations Administrative l'1 revamped andServices now provide weremajor l was developed.The depanment con-tributed to a 50 percent reduction in cost savings for the company. For l the use of fuel oil -our most expen- example, a Risk Management Depan-in 1979. ment has improved insurance rates the sive fuel company pays to the point that $1.25 The accomplishments of 197 The Consumer Services staff was million is saved annually. Materials reorganized to greatly expand the flow opportunities for the of information to customers. Very suc-Management expanded its salvage cen- I cessful" Energy Stores" were opened ter and is saving $100.000 a year by tion and hardTheir workefforts of 4. | ||
reorganized to greatly expand the flow opportunities for the of information to customers. Very suc-Management expanded its salvage cen- I cessful" Energy Stores" were opened ter and is saving $100.000 a year by tion and hardTheir workefforts of 4. | |||
in Beaumont and Baton Rouge to show reconditioning equipment. employees. | in Beaumont and Baton Rouge to show reconditioning equipment. employees. | ||
customers how to conserve energy. OurPublic AffairsandConsumer appreciated. | customers how to conserve energy. OurPublic AffairsandConsumer appreciated. | ||
| Line 1,562: | Line 789: | ||
implemented. financial community of the many and ' | implemented. financial community of the many and ' | ||
expandingissues that affect GSU. | expandingissues that affect GSU. | ||
Results of these activities arereflected in privately many conducted | Results of these activities arereflected in privately many conducted Evaluating and implementing , | ||
Evaluating and implementing , | |||
of our major decisions and policy public opinion surveys that show actions is a Management Council made favorable public opinion of GSU W. Donham Crawford increasing 20 percent to nearly 80 up of nine senior officials. The follow- Chainnan of the Board and percentin 1979 alone. | of our major decisions and policy public opinion surveys that show actions is a Management Council made favorable public opinion of GSU W. Donham Crawford increasing 20 percent to nearly 80 up of nine senior officials. The follow- Chainnan of the Board and percentin 1979 alone. | ||
ing section of this annual report is Chief an Execuuve Officer | ing section of this annual report is Chief an Execuuve Officer System Engineering was stream- interview with the councilmembers lined, eliminating duplication, improv-reflecting our direction for the 1980's. | ||
System Engineering was stream- interview with the councilmembers lined, eliminating duplication, improv-reflecting our direction for the 1980's. | |||
ing pmductivity, upgrading mainte-Iinvite you to read it closely. | ing pmductivity, upgrading mainte-Iinvite you to read it closely. | ||
_{ nance schedules and establishing I regret to report that two directors, | _{ nance schedules and establishing I regret to report that two directors, stronger cost control procedures. who aidedin establishing our course Division Operations expanded ser-for the 1980's. left the board in 1979. | ||
stronger cost control procedures. who aidedin establishing our course Division Operations expanded ser-for the 1980's. left the board in 1979. | |||
vice to customers throughout the sys- AnhurTemple, chairman of Temple-i tem and improved response time to Eastex, and vice chairman of Time, | vice to customers throughout the sys- AnhurTemple, chairman of Temple-i tem and improved response time to Eastex, and vice chairman of Time, | ||
; | ; | ||
| Line 1,583: | Line 804: | ||
The River Bend nuclear plantis thepresident of Science and Technology, mostimportant project the company has been elected to the boad. "' | The River Bend nuclear plantis thepresident of Science and Technology, mostimportant project the company has been elected to the boad. "' | ||
extensiveknowledgeof(? m gy has ever undenaken.The cost of the field be is a valued asset w . Yard. | extensiveknowledgeof(? m gy has ever undenaken.The cost of the field be is a valued asset w . Yard. | ||
plant is high, but the fuel cost will farlower than the alternatives.The i | plant is high, but the fuel cost will farlower than the alternatives.The i | ||
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| Line 2,133: | Line 1,052: | ||
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Management Council utf States' Management Council and $150 million in bonds in an effort is a nine member group of senior to achieve more acceptable debt to InterVICW company officers that meets weekly. equity ratios. Additionally, the com- 1 The council acts to assure coordination pany filed four major rate cases with ! | Management Council utf States' Management Council and $150 million in bonds in an effort is a nine member group of senior to achieve more acceptable debt to InterVICW company officers that meets weekly. equity ratios. Additionally, the com- 1 The council acts to assure coordination pany filed four major rate cases with ! | ||
of management decisions. The Man- regulatort bodies in the course of the { | of management decisions. The Man- regulatort bodies in the course of the { | ||
| Line 2,154: | Line 1,065: | ||
true a year later? were receiving an adequate rate of return - | true a year later? were receiving an adequate rate of return - | ||
Joseph L. Donnelly (Executive Vice President-Finance): Absolutely, and on our investment in g all regulatoryjurisdic- - | Joseph L. Donnelly (Executive Vice President-Finance): Absolutely, and on our investment in g all regulatoryjurisdic- - | ||
w hile we have a long way to go, w e tions. Therefore, con-made substantial progress m 1979, par-s derable emphasis | |||
w hile we have a long way to go, w e tions. Therefore, con- | |||
made substantial progress m 1979, par-s derable emphasis | |||
(''W l | (''W l | ||
ticularly with the was placed on rate fil- Burbank financial participation ings in 1979 and will continue in 1980. | ticularly with the was placed on rate fil- Burbank financial participation ings in 1979 and will continue in 1980. | ||
- ;. | - ;. | ||
of the two coopera-tives in the $1.7 bil- Mr. Donnellv That's correct. Financ-lion River Bend nucle- ing is so crucial ic the years ahead, ar plant. Their total given our large construction program, i of 40 percent parti- that rates and planning are extremely Donnelly cipation will relieve important. Accurate forecasting of our us of about $680 million in construc- physical plant needs, money needs and tion costs over the next four years. manpower needs is an absolute neces-That is about the equivalent of the cost sity. To meet those needs we are putting for a major coal-fired power plant. strong emphasis on an accurate com-We are nearing agreement with Sam puter program of what the company Rayburn Municipal Power Authority looks like when it i, reduced to num-on its potential acquisition of 30 per- bers. This corporate modelis becom-cent of the Nelson 6 coal unit that ing an excellent planning tool. | |||
of the two coopera- | |||
tives in the $1.7 bil- Mr. Donnellv That's correct. Financ-lion River Bend nucle- ing is so crucial ic the years ahead, ar plant. Their total given our large construction program, | |||
would relieve us of about another $140 million. Yet, even though we will be , | would relieve us of about another $140 million. Yet, even though we will be , | ||
sharing the capacities of the power q; - | sharing the capacities of the power q; - | ||
| Line 2,173: | Line 1,077: | ||
4 | 4 | ||
\- | \- | ||
that rates and planning are " | that rates and planning are " | ||
\'4 extremely important." | \'4 extremely important." | ||
needed. That is based on forecasts of i about five percent load growth annu- , | needed. That is based on forecasts of i about five percent load growth annu- , | ||
ally which translates roughly into 300 megawatts of needed capacity each year. | ally which translates roughly into 300 megawatts of needed capacity each year. | ||
| Line 2,188: | Line 1,089: | ||
BamrJ Chairman W D<mham Crawford and Preudent Norman R. Lee not shou n. | BamrJ Chairman W D<mham Crawford and Preudent Norman R. Lee not shou n. | ||
7 | 7 | ||
i InterVICW(continued) Dr. E. Li- Draper (Vice President Mr. Donnelly: I agree with that. Build- ) | i InterVICW(continued) Dr. E. Li- Draper (Vice President Mr. Donnelly: I agree with that. Build- ) | ||
and Technical Assistant to the Chair- ing coal and nuclear plaats is difficult l | and Technical Assistant to the Chair- ing coal and nuclear plaats is difficult l | ||
| Line 2,201: | Line 1,100: | ||
g4 the '80s financially stronger than at I Y nuclear plants. The Draper two generating sta- any time in its history. | g4 the '80s financially stronger than at I Y nuclear plants. The Draper two generating sta- any time in its history. | ||
tions underway have a capital cost as Joseph E. Bondurant (Executive Vice great as all the pow er plants we pres- President-Operations): When we hase ently have combined. It is a challenge the coal and nuclear plants on line, it to finance expansion that took 50 years will g ve us much more operating ! | tions underway have a capital cost as Joseph E. Bondurant (Executive Vice great as all the pow er plants we pres- President-Operations): When we hase ently have combined. It is a challenge the coal and nuclear plants on line, it to finance expansion that took 50 years will g ve us much more operating ! | ||
with its equivalent m half a dozen years. flexibility. We will O. That sounds impossible. Can it be be able to get the max- , | |||
with its equivalent m half a dozen years. flexibility. We will | |||
done at all? imum output from the $ i | done at all? imum output from the $ i | ||
# " "E Norman R. Lee (President and Chief ""fc'g'," f, '#J Operating Officer): T,es, but not with- any given time. That is l out some difficulty. If you could assure me that gas and oil would be abundant an obvious benefit to the customers because | # " "E Norman R. Lee (President and Chief ""fc'g'," f, '#J Operating Officer): T,es, but not with- any given time. That is l out some difficulty. If you could assure me that gas and oil would be abundant an obvious benefit to the customers because | ||
| Line 2,213: | Line 1,110: | ||
. government mandate is minimized. | . government mandate is minimized. | ||
But you can t. That is The government can make any rule it impossible. Coal and wants on a particular fuel, but ue will nuclear are going to be able to keep selling kilowatthours run. L k at the e cos f a o her fue s to 11 Ln oil. % hile gas and oil plants are ch:ap-er to build, the fuel costs will eat > ou Fred C. Repper (Vice President-Public ; | But you can t. That is The government can make any rule it impossible. Coal and wants on a particular fuel, but ue will nuclear are going to be able to keep selling kilowatthours run. L k at the e cos f a o her fue s to 11 Ln oil. % hile gas and oil plants are ch:ap-er to build, the fuel costs will eat > ou Fred C. Repper (Vice President-Public ; | ||
alive in the long run. Affairs): It is interesting to listen to the answers to this one short question. The answers illustrate the large and grow-r : - p ingcomplexityof this NMN business. From my "UI") viewpoint, it increases Q:N- | alive in the long run. Affairs): It is interesting to listen to the answers to this one short question. The answers illustrate the large and grow-r : - p ingcomplexityof this NMN business. From my "UI") viewpoint, it increases Q:N-U I the need to communi-cate such complex information succinct-g i; | ||
U I the need to communi-cate such complex information succinct-g i; | |||
ly and accurately to Repper both our customers f- and our lawmakers. | ly and accurately to Repper both our customers f- and our lawmakers. | ||
Q p 5225 The issues are complex and many | Q p 5225 The issues are complex and many | ||
| Line 2,223: | Line 1,117: | ||
( , | ( , | ||
consequences to the company and its j | consequences to the company and its j | ||
t ;i customers. That is why we have increased dramatically our efforts to | t ;i customers. That is why we have increased dramatically our efforts to communicate with customers and all | ||
communicate with customers and all | |||
~ | ~ | ||
[ levels of government officials. If the D | [ levels of government officials. If the D | ||
| Line 2,233: | Line 1,125: | ||
1 s 1 | 1 s 1 | ||
; 8 j | ; 8 j | ||
I | I | ||
; | ; | ||
Q. Narmwing our Ieus on financing Afr. Humphrey3:The major lesson -- - | Q. Narmwing our Ieus on financing Afr. Humphrey3:The major lesson -- - | ||
and government regulation brings us to learned w as that greater attention must t the highest priced and most regulated be paid to operator training and i | and government regulation brings us to learned w as that greater attention must t the highest priced and most regulated be paid to operator training and i | ||
project the company haw the $1.7 bil- authority. | project the company haw the $1.7 bil- authority. | ||
i | i | ||
( | ( | ||
' lion River llend nuclear unit on which k | ' lion River llend nuclear unit on which k s A construction was resumed shortly af ter Un UNPm Becam nudear plants .z , n | ||
s A construction was resumed shortly af ter Un UNPm Becam nudear plants .z , n | |||
'J | 'J | ||
* a the Three Mile Island accident. Would mn ne r fuH pown most of the time, __ | * a the Three Mile Island accident. Would mn ne r fuH pown most of the time, __ | ||
somebody care tojustitv that? | somebody care tojustitv that? | ||
}"" don I have ups and dow ns. Even _. T airl,me pdots get to take off and land, Dr. Draper: T hat's easy. Joe llondur- | |||
}"" don I have ups and dow ns. Even _. T airl,me pdots get to take off and land, | |||
Dr. Draper: T hat's easy. Joe llondur- | |||
' but nuclear power plant operators may . | ' but nuclear power plant operators may . | ||
ant answered a segment when he spoke go for days or weeks just h)oking at '- | ant answered a segment when he spoke go for days or weeks just h)oking at '- | ||
of flexibihty, but there are other fac- gauges and making small adjustments. . ' ? i, i | of flexibihty, but there are other fac- gauges and making small adjustments. . ' ? i, i | ||
| Line 2,272: | Line 1,151: | ||
oil-fired plants. the untrained eye probably couldn,t detect w hich was the real control room | oil-fired plants. the untrained eye probably couldn,t detect w hich was the real control room | ||
, Afr DonncH3: Despue the long term and which was the simulator. When sasings, it does impose a burden on the company to raise the funds. The only o ihmma by signing the Nuclear wa) is through prompt and reasonable ,re going for 1984 1. abor Stabilization Agreement w'ith rate mcreases f rom our regulatory and we intend to make it." the crafts insols ed. That agreement commiwiont Yet, I point out that calh for no strikes, no slow-dow ns, a | , Afr DonncH3: Despue the long term and which was the simulator. When sasings, it does impose a burden on the company to raise the funds. The only o ihmma by signing the Nuclear wa) is through prompt and reasonable ,re going for 1984 1. abor Stabilization Agreement w'ith rate mcreases f rom our regulatory and we intend to make it." the crafts insols ed. That agreement commiwiont Yet, I point out that calh for no strikes, no slow-dow ns, a | ||
while the cost of buildmg a nuclear our operators are trained, I firmly two alternating crews of craftsmen plant is about twice as expensise as believe they will be able to correctly each working 10-hour, four-day work coal. fired plants, you make up those handle operating abnormalities that weeks so ; hat we get 70 hours of con- | while the cost of buildmg a nuclear our operators are trained, I firmly two alternating crews of craftsmen plant is about twice as expensise as believe they will be able to correctly each working 10-hour, four-day work coal. fired plants, you make up those handle operating abnormalities that weeks so ; hat we get 70 hours of con-cost differentials by having lower fuel they neser experienced in training. struction per w eek. | ||
cost differentials by having lower fuel they neser experienced in training. struction per w eek. | |||
c y nse. | c y nse. | ||
Q. Is R ser llend similar ta Three Mile UmPer: Ily sirtue of this agree-Lym rcm c L. Humphrcp ( thecutive Island., ment there is a sen good possibilits ice Pres,i dent River llend Nuclear | Q. Is R ser llend similar ta Three Mile UmPer: Ily sirtue of this agree-Lym rcm c L. Humphrcp ( thecutive Island., ment there is a sen good possibilits ice Pres,i dent River llend Nuclear g g G{roupt The government is Mi. H caretolly b- Only in that it uses llut it is a sery long fise9 ear con. | ||
g g G{roupt The government is Mi. H caretolly b- Only in that it uses llut it is a sery long fise9 ear con. | |||
contmlling the nuclear mdustry md a uranium as a f uel and w ater as a struction program and there are no coolant and moderator. In fact, the sys- guarantees. | contmlling the nuclear mdustry md a uranium as a f uel and w ater as a struction program and there are no coolant and moderator. In fact, the sys- guarantees. | ||
is an expensive ou ness. The iwucs of mm that failed on the TMI unit doeskt Hs mp ou look at the cri-nuclear safety and esen exist on Riser llend. Ilowever. | is an expensive ou ness. The iwucs of mm that failed on the TMI unit doeskt Hs mp ou look at the cri-nuclear safety and esen exist on Riser llend. Ilowever. | ||
| Line 2,288: | Line 1,163: | ||
, but I suspect the group would has e llend will be completed on time? poing for 1984 and w e intend to make it. | , but I suspect the group would has e llend will be completed on time? poing for 1984 and w e intend to make it. | ||
i been created had there been no TMI. | i been created had there been no TMI. | ||
I T here has alw a)s been an insistence & UumP hreys: First of all, wk at Afr. Lee: There is an additional reason that the River llend project be the best our track record. We said we would to get River Bend on line as smm as i powible from the sicwpoint of safety bring Sabine 5 on line in 1979; we did. possible. We live in a world of energy | I T here has alw a)s been an insistence & UumP hreys: First of all, wk at Afr. Lee: There is an additional reason that the River llend project be the best our track record. We said we would to get River Bend on line as smm as i powible from the sicwpoint of safety bring Sabine 5 on line in 1979; we did. possible. We live in a world of energy i and finance. e are on schedule with Nelson 6, a uncertainty in w hich we are forced to i | ||
i and finance. e are on schedule with Nelson 6, a uncertainty in w hich we are forced to i | |||
coal unit and a type we has e never react to Washington and the od export- | coal unit and a type we has e never react to Washington and the od export- | ||
! Q: That brings up the obvious question built before. We have made a concen- ing nations. When you are dependent | ! Q: That brings up the obvious question built before. We have made a concen- ing nations. When you are dependent | ||
| Line 2,296: | Line 1,169: | ||
) | ) | ||
trated commitment to River Bend both on other people, you had better tighten from the TMl accident. in the management aspect and in the your belt and do w hat needs to be done. | trated commitment to River Bend both on other people, you had better tighten from the TMl accident. in the management aspect and in the your belt and do w hat needs to be done. | ||
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| Line 2,493: | Line 1,284: | ||
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| Line 2,503: | Line 1,292: | ||
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I Louisiana Public Service Q: Does that include customers? | |||
I | |||
Louisiana Public Service Q: Does that include customers? | |||
sion's consistent attitude against g ' | sion's consistent attitude against g ' | ||
InterViCW(continued; ing rate increases in reasonable tin | InterViCW(continued; ing rate increases in reasonable tin Edward Af. Loggins (Senior Vice Pres-l ident-Administrative Servicesi: I stay 6 arm'') | ||
Edward Af. Loggins (Senior Vice Pres-l ident-Administrative Servicesi: I stay 6 arm'') | |||
t | t | ||
' j very close to fuel prices day in and day Afr.Burbank: Utility regulation ha , | ' j very close to fuel prices day in and day Afr.Burbank: Utility regulation ha , | ||
| Line 2,529: | Line 1,306: | ||
continue to change reasonable and fair in the | continue to change reasonable and fair in the | ||
.he company is allowed to earn an their pattern of living. | .he company is allowed to earn an their pattern of living. | ||
quate return for its ins estors. I b | quate return for its ins estors. I b (Y ,, But I think that is con-that the Louisiana com toggins siderably different responding positively, as evidene than changing their standard of living. partially by the increase gran Conservation, in the home, office and December,1978, and other rulini l in transportation is happening now. made in 1979. | ||
(Y ,, But I think that is con-that the Louisiana com toggins siderably different responding positively, as evidene than changing their standard of living. partially by the increase gran Conservation, in the home, office and December,1978, and other rulini l in transportation is happening now. made in 1979. | |||
i i | i i | ||
Afr. Repper Ed's answer is the basis of Afr. Donnelly:The commission why the majority of our advertising is understand that not granting reas ! | Afr. Repper Ed's answer is the basis of Afr. Donnelly:The commission why the majority of our advertising is understand that not granting reas ! | ||
aimed at showing people how to con- able increases,in the long rur. l | aimed at showing people how to con- able increases,in the long rur. l a serve. And it is why the company decreases our bond ratings as h opened "The Energy Store" at shop- pened in 1979. Bond ratings afft ping malls in both Baton Rouge and interest rate when we issue b Beaumont. We went to the people to we have to pay an extra half per show them how to conserve. I doubton,if for instance. $50 million in you can find any other stores in the mortgage bonds, that translates | ||
a serve. And it is why the company decreases our bond ratings as h opened "The Energy Store" at shop- pened in 1979. Bond ratings afft ping malls in both Baton Rouge and interest rate when we issue b Beaumont. We went to the people to we have to pay an extra half per show them how to conserve. I doubton,if for instance. $50 million in you can find any other stores in the mortgage bonds, that translates | |||
$250.000 a year in extra interes ; | $250.000 a year in extra interes ; | ||
" Gulf States can expense that goes on for the lif( | " Gulf States can expense that goes on for the lif( | ||
materially case the shift bonds which may be 30 years. | materially case the shift bonds which may be 30 years. | ||
from oiI and gas..." Who pays that ultimately? T customer. And who does it affe most? The low income custom | from oiI and gas..." Who pays that ultimately? T customer. And who does it affe most? The low income custom | ||
| Line 2,547: | Line 1,318: | ||
We feel as a company that we have an Afr. Repper: Inflation of energ obligation to show our customers how including ours, have seriously i to use energy more efficiently. | We feel as a company that we have an Afr. Repper: Inflation of energ obligation to show our customers how including ours, have seriously i to use energy more efficiently. | ||
-.<me -- | -.<me -- | ||
Afr. Bondurant: In a broader scope, the | Afr. Bondurant: In a broader scope, the | ||
, gradual withdrawal of oil and gas from .$dh3@{ | , gradual withdrawal of oil and gas from .$dh3@{ | ||
" ~ | " ~ | ||
our energy diet will potentially lower i | our energy diet will potentially lower i | ||
} our standard ofliving unless other | } our standard ofliving unless other sources can be brought on line swiftly enough to minimi ze that impact. | ||
sources can be brought on line swiftly enough to minimi ze that impact. | |||
Itis difficult to see whether or not financial constraints will further limit our ability to help ease this problem. | Itis difficult to see whether or not financial constraints will further limit our ability to help ease this problem. | ||
More electricity from alternate sources definitely would help and technically we can generate, transmit and distrib-ute electricity more efficiently than ever before. Gulf States can materially case the shift from oil and gas if w e are financially allowed to do so. | |||
More electricity from alternate sources | ' Q: Willit not be difficult to achieve the company's goals in light of the Lewis Creel she same power plar on page 2. rises from a serene po north of Houston. | ||
definitely would help and technically we can generate, transmit and distrib-ute electricity more efficiently than ever before. Gulf States can materially case the shift from oil and gas if w e are financially allowed to do so | |||
' Q: Willit not be difficult to achieve | |||
the company's goals in light of the Lewis Creel she same power plar on page 2. rises from a serene po north of Houston. | |||
i | i | ||
) | ) | ||
} | } | ||
| Line 2,573: | Line 1,333: | ||
ongoing expansion program. | ongoing expansion program. | ||
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| Line 2,759: | Line 1,438: | ||
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l IntelYlCW(continued) W'MN"'mem+%-- - and gas properties in Mississippi and l M404 Alabama. At the same time, Varibus ' | |||
l | |||
IntelYlCW(continued) W'MN"'mem+%-- - and gas properties in Mississippi and l M404 Alabama. At the same time, Varibus ' | |||
mq pegyw - is exploring a number of potential ura- ! | mq pegyw - is exploring a number of potential ura- ! | ||
i asahwMEh | i asahwMEh | ||
| Line 2,768: | Line 1,444: | ||
NMh mwct;; | NMh mwct;; | ||
Promise for both further expansion and diversification. | Promise for both further expansion and diversification. | ||
a ,awtTt=~ | a ,awtTt=~ | ||
3 | 3 | ||
~ * ^~i , Q: One last question. Why didn't 1979 live up to financial expectations? | ~ * ^~i , Q: One last question. Why didn't 1979 live up to financial expectations? | ||
Afr. Burbank A prime reason was weather. The summer, w hen we sell the most kilowatthours to meet the air conditioning demand of our customers, was unusually cool. | Afr. Burbank A prime reason was weather. The summer, w hen we sell the most kilowatthours to meet the air conditioning demand of our customers, was unusually cool. | ||
Afr. Bondurant: There also are ef(cets | Afr. Bondurant: There also are ef(cets | ||
| Line 2,787: | Line 1,459: | ||
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| Line 2,809: | Line 1,472: | ||
I SurmersforJ a Louisiana bayou in eforts to stake the pathfor new transmisswn lines. | I SurmersforJ a Louisiana bayou in eforts to stake the pathfor new transmisswn lines. | ||
l 13 | l 13 | ||
* John W. Barton Monroe J. Rathbone, Jr. | * John W. Barton Monroe J. Rathbone, Jr. | ||
Directors President 4ack's Cookie Company Medical doctor and partner.The Surgical Baton Rouge. La. (1970) Clinic Bat n Rouge La. (1975) | Directors President 4ack's Cookie Company Medical doctor and partner.The Surgical Baton Rouge. La. (1970) Clinic Bat n Rouge La. (1975) | ||
| Line 2,856: | Line 1,516: | ||
33 - . - . | 33 - . - . | ||
y- -- - - | y- -- - - | ||
n . . - . - , | n . . - . - , | ||
Financial Section ' rana ==a= | Financial Section ' rana ==a= | ||
f k Management Responsibdaty for Pinancist kata==r= .. . . 15 l | f k Management Responsibdaty for Pinancist kata==r= .. . . 15 l | ||
| Line 2,870: | Line 1,527: | ||
Analysis of the *----- ny of Operations 17 f | Analysis of the *----- ny of Operations 17 f | ||
( | ( | ||
e matamant of Inconie . ..... 19 l Sources of FundsInvestedin Utility and Other Plant 20 j Statement of Retamed Earmngs. 20 l i | e matamant of Inconie . ..... 19 l Sources of FundsInvestedin Utility and Other Plant 20 j Statement of Retamed Earmngs. 20 l i | ||
Balance Sheet . 21 Statement of Capita 1mation 22 Notes to Financial Statements 23 t Auditors' Report 31 Statistical Summary 32 l | Balance Sheet . 21 Statement of Capita 1mation 22 Notes to Financial Statements 23 t Auditors' Report 31 Statistical Summary 32 l | ||
I Management Management is responsible for the preparation, integrity, and objectivity of I Responsibility for the fonowing financial statements of Gulf States Utilities Company. The statements have been prepared in conformity with generally accepted accounting Financial Statements principles and, in some cases, reflect amounts based on estimates and l judgment of management, giving due consideradon to materiality. l The Company maintains a system of internal controls designed to help give reasonable assurance that the books and records properly reflect the l transactions of the Company and that established policies and procedures are followed. Internal control systems are subject to inherent limits in recognition of the need to balance their costs with the benefits they produce. The Company's management strives to maintain this balance. l Coopers & Lybrand, independent certified public accountants, are engaged to exanune,in accordance with generally accepted auditing star. lards, the | I Management Management is responsible for the preparation, integrity, and objectivity of I Responsibility for the fonowing financial statements of Gulf States Utilities Company. The statements have been prepared in conformity with generally accepted accounting Financial Statements principles and, in some cases, reflect amounts based on estimates and l judgment of management, giving due consideradon to materiality. l The Company maintains a system of internal controls designed to help give reasonable assurance that the books and records properly reflect the l transactions of the Company and that established policies and procedures are followed. Internal control systems are subject to inherent limits in recognition of the need to balance their costs with the benefits they produce. The Company's management strives to maintain this balance. l Coopers & Lybrand, independent certified public accountants, are engaged to exanune,in accordance with generally accepted auditing star. lards, the | ||
; Samacini staraments of the Company and issue a report thereon, which appears | ; Samacini staraments of the Company and issue a report thereon, which appears | ||
; on page 31',5mch auditing standards include a review of internal accounting | ; on page 31',5mch auditing standards include a review of internal accounting controls, a test of transactions, and other procedures sufficient to provide reasonable assurance that the Anancial statements are neither matarially | ||
controls, a test of transactions, and other procedures sufficient to provide reasonable assurance that the Anancial statements are neither matarially | |||
;, ] gor enntain matarial grega. | ;, ] gor enntain matarial grega. | ||
; fIhe Board of Directors, through the Audit Committee of the Board, has , | ; fIhe Board of Directors, through the Audit Committee of the Board, has , | ||
| Line 2,891: | Line 1,544: | ||
I Ihe i=daaaad--' accountants have full and free accus to meet with the Audit | I Ihe i=daaaad--' accountants have full and free accus to meet with the Audit | ||
. 'c ,,,i,,-- | . 'c ,,,i,,-- | ||
: p. , | : p. , | ||
1 - . - % N _ eves M m escass the resaits of their aramin Son and their opinion on the adequacy of internal J - | 1 - . - % N _ eves M m escass the resaits of their aramin Son and their opinion on the adequacy of internal J - | ||
1 accounting controls and the quality of financini reporting. | 1 accounting controls and the quality of financini reporting. | ||
p . m- . | p . m- . | ||
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15 f. | 15 f. | ||
Summary of Operations For the ave sears ended December 31,1979 Da thousands except per share announts and KWH sales) 1979 1978 1977 1976 1975 Operating Revenne $864,338 $717,958 $587,760 $447,739 $362,234 Operating Expenses and Taxes Fuel 318,494 316,559 257,013 183,190 125,007 Purchased power 160,882 54,501 30,931 8,481 5,982 Other operations and maintenance 139,331 107,239 84,698 64,519 55,878 Depreciation 62,887 62,573 59,882 53,717 50,060 Taxes - net 67,434 72,651 65,387 53,245 47,147 749,028 613,523 497,911 363,152 284,074 Operating Income 115,310 104,435 89,849 84,587 78,160 Other Income and Deductions Allowance for equity funds used during construction 27,260 15,710 15,072 13,110 8,161 Other - net 1,805 (290) 4,443 (445) 970 Income Before Interest Charges 144,375 119,855 109,364 97,257 87,291 Interest Charges , | Summary of Operations For the ave sears ended December 31,1979 Da thousands except per share announts and KWH sales) 1979 1978 1977 1976 1975 Operating Revenne $864,338 $717,958 $587,760 $447,739 $362,234 Operating Expenses and Taxes Fuel 318,494 316,559 257,013 183,190 125,007 Purchased power 160,882 54,501 30,931 8,481 5,982 Other operations and maintenance 139,331 107,239 84,698 64,519 55,878 Depreciation 62,887 62,573 59,882 53,717 50,060 Taxes - net 67,434 72,651 65,387 53,245 47,147 749,028 613,523 497,911 363,152 284,074 Operating Income 115,310 104,435 89,849 84,587 78,160 Other Income and Deductions Allowance for equity funds used during construction 27,260 15,710 15,072 13,110 8,161 Other - net 1,805 (290) 4,443 (445) 970 Income Before Interest Charges 144,375 119,855 109,364 97,257 87,291 Interest Charges , | ||
Long-term debt 68,784 59,485 53,622 47,078 40,539 Other 17,539 7,010 2,931 4,403 6,796 Allowance for borrowed funds used dur-ing construction (26,129) (16,786) (12,839) (10,640) (9,737) | Long-term debt 68,784 59,485 53,622 47,078 40,539 Other 17,539 7,010 2,931 4,403 6,796 Allowance for borrowed funds used dur-ing construction (26,129) (16,786) (12,839) (10,640) (9,737) | ||
| Line 2,923: | Line 1,566: | ||
Management's Discussion The following discussion and analysis of the Company's operations sets forth and Analysis of the the factors the Company believes to be reasonable causes for the changes in Summary of Operations 'cVenue and expense items for the three most recent periods presented on the accompanying summary of operations. | Management's Discussion The following discussion and analysis of the Company's operations sets forth and Analysis of the the factors the Company believes to be reasonable causes for the changes in Summary of Operations 'cVenue and expense items for the three most recent periods presented on the accompanying summary of operations. | ||
Operstlag Revenue The Company derived 89% of its operating revenue from sales of electricity for the year ended December 31,1979, and 90% and 91% for the years ended December 31,1978 and 1977, respectively. He balance of operating revenue was derived from sales of steam and gas. He changes in operating revenue for the three periods were attributable to the following (in thousands): | Operstlag Revenue The Company derived 89% of its operating revenue from sales of electricity for the year ended December 31,1979, and 90% and 91% for the years ended December 31,1978 and 1977, respectively. He balance of operating revenue was derived from sales of steam and gas. He changes in operating revenue for the three periods were attributable to the following (in thousands): | ||
Years Ended December 31, 1979 1978 1977 General rate increases $ 31,804 $ 14,896 $ 10,566 Fuel included in base rates (39,044) (41,631) 13,666 Fuel adjustment 118,211 115,864 70,508 Sales volume 35,409 41,069 45,281 Net increase $146,380 $130,198 $140,021 | Years Ended December 31, 1979 1978 1977 General rate increases $ 31,804 $ 14,896 $ 10,566 Fuel included in base rates (39,044) (41,631) 13,666 Fuel adjustment 118,211 115,864 70,508 Sales volume 35,409 41,069 45,281 Net increase $146,380 $130,198 $140,021 Increase over previous period 20 % 22 % 31 % | ||
Increase over previous period 20 % 22 % 31 % | |||
Fuel included in base rates in the table above is that revenue derived from inclusion of a portion of fuel costs in the computation of the base rates. In ; | Fuel included in base rates in the table above is that revenue derived from inclusion of a portion of fuel costs in the computation of the base rates. In ; | ||
1978, the Public Utility Commission of Texas (PUCT) ordered the Company { | 1978, the Public Utility Commission of Texas (PUCT) ordered the Company { | ||
to recover its fuel costs through the fuel adjustment, thereby decreasing revenue from fuel included in base rates and increasing revenue from the fuel adjustment. The sales volume increase in 1979 was due principally to increased industrial use of electricity. The sales volume increases in both 1978 and 1977, when corapared to previous periods, were due to unusually cold winter weather, warmer than normal summer temperatures, and increasing numbers of customers. | to recover its fuel costs through the fuel adjustment, thereby decreasing revenue from fuel included in base rates and increasing revenue from the fuel adjustment. The sales volume increase in 1979 was due principally to increased industrial use of electricity. The sales volume increases in both 1978 and 1977, when corapared to previous periods, were due to unusually cold winter weather, warmer than normal summer temperatures, and increasing numbers of customers. | ||
Operating Expenses Fuel expense for electric generation increased $1,871,000 for 1979, as ' | Operating Expenses Fuel expense for electric generation increased $1,871,000 for 1979, as ' | ||
compared to 1978, due to increased prices for fuel oil and natural gas even though generation requirements for the same period were decreased. . | compared to 1978, due to increased prices for fuel oil and natural gas even though generation requirements for the same period were decreased. . | ||
Increases in 1 el exnense for the years ended 1978 and 1977 of $59,665,000 and $74,043,000, respectively, when compared to previous periods, were primarily due to increased prices for fuel oil and natural gas, increased generation requirements, and changes in fuel mix. | Increases in 1 el exnense for the years ended 1978 and 1977 of $59,665,000 and $74,043,000, respectively, when compared to previous periods, were primarily due to increased prices for fuel oil and natural gas, increased generation requirements, and changes in fuel mix. | ||
An increase in purchased power expense of $106,381,000 for 1979, as compared to 1978, was principally caused by a combination of load growth, | An increase in purchased power expense of $106,381,000 for 1979, as compared to 1978, was principally caused by a combination of load growth, | ||
| Line 2,943: | Line 1,582: | ||
l 1 | l 1 | ||
~ | ~ | ||
t I | t I | ||
17 | 17 | ||
n w m , n m ~ w :.~.v w. m ,- m e w .,u _ .x . | n w m , n m ~ w :.~.v w. m ,- m e w .,u _ .x . | ||
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~ '"Maintamasce expense increased $10,540,000 for the year 1979, over the h .. year 1978, due to mainh==ca performed to restore to service units suffering | ~ '"Maintamasce expense increased $10,540,000 for the year 1979, over the h .. year 1978, due to mainh==ca performed to restore to service units suffering | ||
? . ~ ~ ' breakdowns and extensive preventive maintmance of units to improve the av=Hahikey of those units. Increased maintenance expense of $8,418,000 for | ? . ~ ~ ' breakdowns and extensive preventive maintmance of units to improve the av=Hahikey of those units. Increased maintenance expense of $8,418,000 for | ||
? the year 1978,'over the year 1977, and $9,997,000 for 1977, over 1976, 5 - | ? the year 1978,'over the year 1977, and $9,997,000 for 1977, over 1976, 5 - | ||
;,was due primarily to increased -int-ngof.generstag equipment L . | ;,was due primarily to increased -int-ngof.generstag equipment L . | ||
. --_- necessitate.d.by | . --_- necessitate.d.by forced outages. ._ . _ _ ~ . . , .. | ||
forced outages. ._ . _ _ ~ . . , .. | |||
g' - . | g' - . | ||
.- _ _ ...~. _ .. . ..--- - | .- _ _ ...~. _ .. . ..--- - | ||
e ~ ? ' ' ~ Increased depreciation expense of $2,691,000 and $6,165,000 for the I ; years ended 1978 and 1977, ay,Aly, when compared to the previous | e ~ ? ' ' ~ Increased depreciation expense of $2,691,000 and $6,165,000 for the I ; years ended 1978 and 1977, ay,Aly, when compared to the previous | ||
~~ | ~~ | ||
periods, were principally c===d by additions to plant. Depreciation expense in 1979 re==inad relatively the same as in 1978. In 1979, the Company | periods, were principally c===d by additions to plant. Depreciation expense in 1979 re==inad relatively the same as in 1978. In 1979, the Company | ||
, used a 3.76% composite electric depreciation rate, which rate was allowed by the PUCT (see Note I to Financial Statements). His rate was lower than the 3.86% composite electric depreciation rate used in 1978. He effect of the lower rate was offset by more plant in service. | , used a 3.76% composite electric depreciation rate, which rate was allowed by the PUCT (see Note I to Financial Statements). His rate was lower than the 3.86% composite electric depreciation rate used in 1978. He effect of the lower rate was offset by more plant in service. | ||
Taxes A decrease in taxes between 1979 and 1978 was due principally to a change in the Federalincome tax rate. The increase in taxes for the year 1978, over 1977, was attributable to an increase in pre-tax income. The increase in taxes in 1977, over the previous year, was principally attnbutable to an merease in pre-tax income and higher payroll an'd property | |||
Taxes A decrease in taxes between 1979 and 1978 was due principally to a change in the Federalincome tax rate. The increase in taxes for the year 1978, over 1977, was attributable to an increase in pre-tax income. The increase in taxes in 1977, over the previous year, was principally attnbutable to an | |||
merease in pre-tax income and higher payroll an'd property | |||
* axes. | * axes. | ||
OtherIncome Other income is.moxd in 1979 primarily due to the increase in the allowance ! | OtherIncome Other income is.moxd in 1979 primarily due to the increase in the allowance ! | ||
for equity funds used d' iring construction. This increase resulted from j | for equity funds used d' iring construction. This increase resulted from j | ||
^ | ^ | ||
higher levels of construction work in progress and a change in the rate applied l to compute the allowance for funds used during construction (see Note 1 to Financial Statements). He changes in other income for the years 1978 and l | higher levels of construction work in progress and a change in the rate applied l to compute the allowance for funds used during construction (see Note 1 to Financial Statements). He changes in other income for the years 1978 and l | ||
t | t 1977 were primarily due to the gain on the sales of certain equipment and a portion of the Company's uranium concentrates and a loss on abandonment ; | ||
a portion of the Company's uranium concentrates and a loss on abandonment ; | |||
of certain property under construction which occurred in 1977. | of certain property under construction which occurred in 1977. | ||
Interest CharEes Interest charges on long-term debt increased $9,299,000 for the year 1979, ; | Interest CharEes Interest charges on long-term debt increased $9,299,000 for the year 1979, ; | ||
over 1978, primarily due to the issuances of additional securities. An increase in the amount and cost of short-term debt and certain trusts were the causes for the increase in other interest charges for 1979, over 1978. The g increase in the allowance for borrowed funds used during construction resulted i F from higher levels of castruction work in progress, a change in the rate L applied to compute the allowance for funds used during construction, and the u inclusion of interest expense incurred by certain trusts as part of the borrowed ; | over 1978, primarily due to the issuances of additional securities. An increase in the amount and cost of short-term debt and certain trusts were the causes for the increase in other interest charges for 1979, over 1978. The g increase in the allowance for borrowed funds used during construction resulted i F from higher levels of castruction work in progress, a change in the rate L applied to compute the allowance for funds used during construction, and the u inclusion of interest expense incurred by certain trusts as part of the borrowed ; | ||
: b. .s , | : b. .s , | ||
g- ~. | g- ~. | ||
. . . n (; f. - . - . | . . . n (; f. - . - . | ||
o tends component of alkmance for funds used during constructice. An increase . | o tends component of alkmance for funds used during constructice. An increase . | ||
t ible debentures in Septa =har, 1977 an , l | t ible debentures in Septa =har, 1977 an , l U. | ||
U. | |||
r- .n . .. | r- .n . .. | ||
n. | n. | ||
.Y ' ,'~ principallyi to the issuance of convertincrease. in short term | .Y ' ,'~ principallyi to the issuance of convertincrease. in short term f w - .,J for theyear 1977 increased, when compared to.the prior pedad, due to p _ . i e. . 'the issuance of additional securhina. , N cd | ||
f w - .,J for theyear 1977 increased, when compared to.the prior pedad, due to p _ . i e. . 'the issuance of additional securhina. , N cd | |||
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7 Statement ofIncome c resnelas R = === 7" Bectnc . . . . . . . .n. . . . . . ... . _. $. 79,415 $ 645,899 E | 7 Statement ofIncome c resnelas R = === 7" Bectnc . . . . . . . .n. . . . . . ... . _. $. 79,415 $ 645,899 E | ||
per meyeessendes -48,278 50,513 9 | per meyeessendes -48,278 50,513 9 | ||
Decameser n.19fp end 19Fs 7 ? ' Steaan . . S. . . . m. . . . . .n,.... . | Decameser n.19fp end 19Fs 7 ? ' Steaan . . S. . . . m. . . . . .n,.... . | ||
26,645 21,546 di per , | 26,645 21,546 di per , | ||
_ , g13M[*83 3 8 f 7 f y o -...;;o..._ ~ | _ , g13M[*83 3 8 f 7 f y o -...;;o..._ ~ | ||
864,338 717,958 | 864,338 717,958 | ||
. -.. . w,, , | . -.. . w,, , | ||
~ ~ ~ ~ - a QOperJagEspenses and Tesas gy u . .- . | |||
~ ~ ~ ~ - a QOperJagEspenses and Tesas | |||
gy u . .- . | |||
a . :. 2__=. 9. ,,g .2. . . .. ;... -.- | a . :. 2__=. 9. ,,g .2. . . .. ;... -.- | ||
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| Line 3,166: | Line 1,712: | ||
: g. ~_ _ _ ~. . . | : g. ~_ _ _ ~. . . | ||
- -_ . ... .... .n | - -_ . ... .... .n | ||
. ~ ~ ~ ~ - | . ~ ~ ~ ~ - | ||
'...'' 160,882 54,501 92,631 71,079 Other operations h | '...'' 160,882 54,501 92,631 71,079 Other operations h | ||
i A. . . , , . , . . | i A. . . , , . , . . | ||
46,700 36,160 f | 46,700 36,160 f | ||
~~ Maintenance y. | |||
~~ Maintenance | |||
y. | |||
- ~ ~ ~ ~ - | - ~ ~ ~ ~ - | ||
62,887 62,573 | 62,887 62,573 | ||
| Line 3,182: | Line 1,722: | ||
~ | ~ | ||
.'...n.~.,. . . | .'...n.~.,. . . | ||
I Taxes (Note 6) | I Taxes (Note 6) | ||
Income I (7,163) 3,974 | Income I (7,163) 3,974 Current . 24,309 Deferred -net 16,911 28,446 17,900 Investment tax credits-net 29,240 26,468 l Other 749,028 613,523 n 115,310 104,435 OperstlagInconne ~^ - - | ||
Deferred -net 16,911 28,446 17,900 Investment tax credits-net 29,240 26,468 l Other 749,028 613,523 n 115,310 104,435 OperstlagInconne ~^ - - | |||
e Other Income and Dade*'ons i | e Other Income and Dade*'ons i | ||
l Allowance for equity funds used during 27,260 15,710 L | l Allowance for equity funds used during 27,260 15,710 L | ||
construction | construction | ||
+ I Other - net 1,805 (290) 144,375 119,855 Income Before Interest Charges Interest Charges (Note 1) | + I Other - net 1,805 (290) 144,375 119,855 Income Before Interest Charges Interest Charges (Note 1) 68,784 59,485 Long-term debt 17,539 7,010 Other Allowance for borrowed funds used during construction (26,129) (I6,786) 60,194 49,709 84,181 70,146 Net Inconne (Note 11) 15,622 10,990 Dividends on Preferred Stock | ||
68,784 59,485 Long-term debt 17,539 7,010 Other Allowance for borrowed funds used during construction (26,129) (I6,786) 60,194 49,709 84,181 70,146 Net Inconne (Note 11) 15,622 10,990 Dividends on Preferred Stock | |||
$ 68,559 $ 59,156 Inconne Applicable to Comunom Stock i , | $ 68,559 $ 59,156 Inconne Applicable to Comunom Stock i , | ||
Average Shares of Common Stock Outstanding 39,310 34,265 r | Average Shares of Common Stock Outstanding 39,310 34,265 r | ||
.~.. | .~.. | ||
' i . ._;. Earmigs Per Share et s'- Stock | ' i . ._;. Earmigs Per Share et s'- Stock | ||
.g .. n . p._ | .g .. n . p._ | ||
;.. - | ;.. - | ||
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$1.73 ' | $1.73 ' | ||
~ Based o_n average shares --H--- '% . ' .'. . * ~ r $1.74 : - | ~ Based o_n average shares --H--- '% . ' .'. . * ~ r $1.74 : - | ||
: y. Assuming conversion of convertible debentures . c. . . . 1.65 1.62 g-' - , | : y. Assuming conversion of convertible debentures . c. . . . 1.65 1.62 g-' - , | ||
. Dividends per | . Dividends per Share of (%=- Stock . . . 1.36 1.24 | ||
Share of (%=- Stock . . . 1.36 1.24 | |||
: y. . | : y. . | ||
i The accompanying notes are un integral part of the Gnancial sta**= wats. | i The accompanying notes are un integral part of the Gnancial sta**= wats. | ||
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i | i | ||
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_ A. - - , . - | _ A. - - , . - | ||
1979 1978 Provided Frous Operations Sources of Funds Invested $ 84,181 $ 70,146 Net income In Utility and Other Plant Prmeipal income items not requiring current For abe years ended funds Deceanber 31,1979 and 1978 62,887 62,573 Depreciation cm ebessende) 16,911 24,309 Deferred income mes-net 28,446 17,900 Investment tax credits-net . | 1979 1978 Provided Frous Operations Sources of Funds Invested $ 84,181 $ 70,146 Net income In Utility and Other Plant Prmeipal income items not requiring current For abe years ended funds Deceanber 31,1979 and 1978 62,887 62,573 Depreciation cm ebessende) 16,911 24,309 Deferred income mes-net 28,446 17,900 Investment tax credits-net . | ||
Equity component of allowance for funds used during construction (27,260) (15,710) ! | Equity component of allowance for funds used during construction (27,260) (15,710) ! | ||
Total provided from operations 165,165 159,218 Dividends Preferred dividends (15,622) (10,990) , | Total provided from operations 165,165 159,218 Dividends Preferred dividends (15,622) (10,990) , | ||
| Line 3,328: | Line 1,809: | ||
Preferred stock subject to mandatory redemption 35,000 - | Preferred stock subject to mandatory redemption 35,000 - | ||
Fi st mortgage bonds (principal amount) 150,000 - | Fi st mortgage bonds (principal amount) 150,000 - | ||
8,162 56,331 l Net change in short-term borrowings Reduction of long-term debt (11,992) (12,377) 9,784 51,277 Equipment purchase obligations | 8,162 56,331 l Net change in short-term borrowings Reduction of long-term debt (11,992) (12,377) 9,784 51,277 Equipment purchase obligations 276,057 165,020 | ||
276,057 165,020 | |||
! Total provided from financing t | ! Total provided from financing t | ||
Other Sources and Uses Provided from sales of nuclear fuel (including capitali7ed interest) and other 10,818 56,682 property Temporary cash investments 33,000 (33,000) | Other Sources and Uses Provided from sales of nuclear fuel (including capitali7ed interest) and other 10,818 56,682 property Temporary cash investments 33,000 (33,000) | ||
Other - net (principally changes in working (25,419) 3,761 capital) | Other - net (principally changes in working (25,419) 3,761 capital) | ||
Total provided from other sources 18,399 27,443 and uses ' | Total provided from other sources 18,399 27,443 and uses ' | ||
390,153 298,213 | 390,153 298,213 | ||
*- Expenditures for Utility and Other Flaat | *- Expenditures for Utility and Other Flaat Equity component of allowance for funds used during construction 27,260 15,710 g., , | ||
Equity component of allowance for funds used during construction 27,260 15,710 g., , | |||
Invested la UtEty and Olhar Heat . . . , , ... ? $ 417,413 $ 313,923 | Invested la UtEty and Olhar Heat . . . , , ... ? $ 417,413 $ 313,923 | ||
; 97 5'_ , | ; 97 5'_ , | ||
l e -< n- .. . | l e -< n- .. . | ||
. .; , g. g u. , . , z_._ | . .; , g. g u. , . , z_._ | ||
| Line 3,349: | Line 1,823: | ||
r I | r I | ||
m _- .- | m _- .- | ||
m ano 197s Balance at be8i nning of year $ 226,038 $ 209,360 l Stateinent of Retained l Earnings Add (Dedact) 70,146 Net income . 84,181 i For she years essea (15,622) (10,990) | |||
m ano 197s | |||
Balance at be8i nning of year $ 226,038 $ 209,360 l Stateinent of Retained l Earnings Add (Dedact) 70,146 Net income . 84,181 i For she years essea (15,622) (10,990) | |||
Decommer 31.1979 and 197s Dividends on praderred stock . . ..... | Decommer 31.1979 and 197s Dividends on praderred stock . . ..... | ||
(53,846) (42,478) r K: , | (53,846) (42,478) r K: , | ||
| Line 3,358: | Line 1,829: | ||
8 226,038 | 8 226,038 | ||
[' . MM p 3 u. | [' . MM p 3 u. | ||
v'. | |||
ty .- % .* 9.,;. 7 % ?. | ty .- % .* 9.,;. 7 % ?. | ||
- Balance at end of year (Nota 2) . | - Balance at end of year (Nota 2) . | ||
, C n 7_ 2. . ., | , C n 7_ 2. . ., | ||
~$ 248,751 l l | ~$ 248,751 l l | ||
.. he accompanying aseos are an latogral peut of the anno: int - l W' W 1 , VU .q-.- N + - - | .. he accompanying aseos are an latogral peut of the anno: int - l W' W 1 , VU .q-.- N + - - | ||
| Line 3,386: | Line 1,852: | ||
: p. - - - | : p. - - - | ||
~ | ~ | ||
- m;3 3''.-g | - m;3 3''.-g | ||
,- _s. | ,- _s. | ||
| Line 3,395: | Line 1,860: | ||
'y' y ? ~ j | 'y' y ? ~ j | ||
. 1.? , , c p :'Q , | . 1.? , , c p :'Q , | ||
:' i: | :' i: | ||
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3 ~, | 3 ~, | ||
: x. x y | : x. x y | ||
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op- ,+ | op- ,+ | ||
l 1979 197s i | |||
l | |||
1979 197s i | |||
Balance Sheet Amets neceank.c 31 1979 and 197s Utility and Other Plant, at original cost g, -j Plant in service . . . . ... $1,898,363 $1,673,830 Less: Accumulated provision for depreciation . 607,428 548,304 1,290,935 1,125,526 Construction work in progress 812,227 652,524 l_ Nuclear fuel (Note 9) . 97,847 67,895 2,201,009 1,845,945 Other Property and Investments Subsidiary company (Note 1) 22,327 19,290 Other . . . . 1,936 2,067 24,263 21,357 Current Assets Cash (Note 8) . 3,748 12,505 Temporary cash investments - 33,000 Receivables Customers 75,951 58,296 Other ........ 3,134 3,090 ! | Balance Sheet Amets neceank.c 31 1979 and 197s Utility and Other Plant, at original cost g, -j Plant in service . . . . ... $1,898,363 $1,673,830 Less: Accumulated provision for depreciation . 607,428 548,304 1,290,935 1,125,526 Construction work in progress 812,227 652,524 l_ Nuclear fuel (Note 9) . 97,847 67,895 2,201,009 1,845,945 Other Property and Investments Subsidiary company (Note 1) 22,327 19,290 Other . . . . 1,936 2,067 24,263 21,357 Current Assets Cash (Note 8) . 3,748 12,505 Temporary cash investments - 33,000 Receivables Customers 75,951 58,296 Other ........ 3,134 3,090 ! | ||
Refundable Federal income taxes 24,867 4,064 Materials and supplies, at average cost 10,452 7,523 Fuel stock, at average cost 48,351 31,371 Prepayments and other 7,599 3,360 174,102 153,209 Deferred Charges Unamartized debt expense . . . 3,900 2,685 Unamortized project cancellation costs (Note 7) 25,027 25,332 Other 11,044 10,897 39,971 38,914 s2,439,345 $2,059,425 Capitalization and IJabilities Capitalization (See Statement of Capitalization) | Refundable Federal income taxes 24,867 4,064 Materials and supplies, at average cost 10,452 7,523 Fuel stock, at average cost 48,351 31,371 Prepayments and other 7,599 3,360 174,102 153,209 Deferred Charges Unamartized debt expense . . . 3,900 2,685 Unamortized project cancellation costs (Note 7) 25,027 25,332 Other 11,044 10,897 39,971 38,914 s2,439,345 $2,059,425 Capitalization and IJabilities Capitalization (See Statement of Capitalization) | ||
| Line 3,428: | Line 1,881: | ||
< Investment tax credits . . .. 99,226 69,423 1 | < Investment tax credits . . .. 99,226 69,423 1 | ||
..; . : | ..; . : | ||
Accumulated deferred income taxes . . 143,883 126,389 ; | Accumulated deferred income taxes . . 143,883 126,389 ; | ||
, Other ... .. .... . .... . ..... 4,619 14,000 l | , Other ... .. .... . .... . ..... 4,619 14,000 l | ||
247,728 209,812 l | 247,728 209,812 l | ||
{ neceed. from Sale of Nuclear Fuel (Note 9) 65,157 56,682 i | { neceed. from Sale of Nuclear Fuel (Note 9) 65,157 56,682 i s2,439,345 s2,059,425 De wying notes are an integral part of the Snancial matements. | ||
s2,439,345 s2,059,425 De wying notes are an integral part of the Snancial matements | |||
t l b-yw l r l | t l b-yw l r l | ||
[ 21 | [ 21 | ||
| Line 3,442: | Line 1,890: | ||
: r. _ . ~ , ..._ .. _ _ , | : r. _ . ~ , ..._ .. _ _ , | ||
. . .__.w. 2. ,. , , m . _. . . . _ | . . .__.w. 2. ,. , , m . _. . . . _ | ||
: m. ' . .: m.w;xxphMM;qd :d;&Q"Lms. - a. _ | : m. ' . .: m.w;xxphMM;qd :d;&Q"Lms. - a. _ | ||
a.; = _ u _ d , | a.; = _ u _ d , | ||
? ." '^ | ? ." '^ | ||
.: .6.. ~ ' : E3'22f*;9:XyM. ; | .: .6.. ~ ' : E3'22f*;9:XyM. ; | ||
l -: . ~ . -" . l' a KHQ.n:. .- .. nm - | l -: . ~ . -" . l' a KHQ.n:. .- .. nm - | ||
a me n n Statement of ~ ~ ' ~ ' 'T" r --= Sheeholded Egsety | a me n n Statement of ~ ~ ' ~ ' 'T" r --= Sheeholded Egsety I i CY talization g2 ands) stock, without per value S 398,121 $ 348,018 h Deconsbur 31.1M and Ms ' Frendum and expense on Capital i | ||
I i CY talization g2 ands) stock, without per value S 398,121 $ 348,018 h Deconsbur 31.1M and Ms ' Frendum and expense on Capital i | |||
i | i | ||
"" .eenck ..... 2............ . . (1.094) 350 , | "" .eenck ..... 2............ . . (1.094) 350 , | ||
~ Other paid-in cephal . . . . . . . . . . . 25,947 19,297 : | ~ Other paid-in cephal . . . . . . . . . . . 25,947 19,297 : | ||
[- | [- | ||
uneminat eensimp . . . . . . . . . . . . 240,7s1 226,038 463435_. 36 593,703 38 T.' | uneminat eensimp . . . . . . . . . . . . 240,7s1 226,038 463435_. 36 593,703 38 T.' | ||
~n. _. . . - - . . | ~n. _. . . - - . . | ||
!- "~ Preferred Stoek (Notes'2 and 3) ~ n" 5. I | !- "~ Preferred Stoek (Notes'2 and 3) ~ n" 5. I | ||
$100 pervalue . . . | $100 pervalue . . . | ||
{ | { | ||
. - w ._ | . - w ._ | ||
nevesses Shares Bassmgees asks osammmans thans j | nevesses Shares Bassmgees asks osammmans thans j | ||
[ i | [ i Not subject to mandatary redemption 1 | ||
$4.40 51,173 3108.00 5,117 7,328 , | $4.40 51,173 3108.00 5,117 7,328 , | ||
4.50 . . . 5,830 105.00 553 2,618 i | 4.50 . . . 5,830 105.00 553 2,618 i | ||
4.40 1949 1,655 103.00 166 481 i 4.20 9,745 102.818 F15 2,921 l 4.44 14,804 103.75 1,400 1,948 i 5.00 10,993 104.25 1,099 3,022 5.08 26,845 104.63 2,685 4,806 ; | |||
4.40 1949 1,655 103.00 166 481 i 4.20 9,745 102.818 F15 2,921 l 4.44 14,804 103.75 1,400 1,948 i | |||
5.00 10,993 104.25 1,099 3,022 5.08 26,845 104.63 2,685 4,806 ; | |||
c .4.52 . . . . 10,564 103.57 1,056 2,859 l | c .4.52 . . . . 10,564 103.57 1,056 2,859 l | ||
- 6.08 . . . 32,829 103.34 3,283 6,923 i 7.56 350,000 106.80 35,000 35,000 l 8.52 500,000 109.95 50,000 50,000 9.96 350,000 111.60 35,000 _ _ | - 6.08 . . . 32,829 103.34 3,283 6,923 i 7.56 350,000 106.80 35,000 35,000 l 8.52 500,000 109.95 50,000 50,000 9.96 350,000 111.60 35,000 _ _ | ||
j 136,444 7 117,936 7 I | j 136,444 7 117,936 7 I Subject to mandatory redemption 8.80 371,835 107.00 37,183 28,243 I 9.75 33,697 107.00 3,370 2,291 j 8.64 350,000 108.64 35,000 - | ||
Subject to mandatory redemption 8.80 371,835 107.00 37,183 28,243 I 9.75 33,697 107.00 3,370 2,291 j 8.64 350,000 108.64 35,000 - | |||
i 75,553 7 - | i 75,553 7 - | ||
30,534 2 Long-Term Debt (Note 4) | 30,534 2 Long-Term Debt (Note 4) | ||
| Line 3,492: | Line 1,919: | ||
2% % due June 1,1980 . . . . . - 13,000 1 3%% due November 1,1981 10,000 10,000 ! | 2% % due June 1,1980 . . . . . - 13,000 1 3%% due November 1,1981 10,000 10,000 ! | ||
3%% due December 1,1982 10,000 10,000 3%% due December 1,1983 10,000 10,000 Maturing 1985 through 1994-4% to 5%% . ...... . 112,000 112,000 Maturing 1995 through 2004-5 % to 8% % . . . . . . . . . . . . . 375,000 ,; _ . 375,000 Maturing 2005 throudi 2009- ' | 3%% due December 1,1982 10,000 10,000 3%% due December 1,1983 10,000 10,000 Maturing 1985 through 1994-4% to 5%% . ...... . 112,000 112,000 Maturing 1995 through 2004-5 % to 8% % . . . . . . . . . . . . . 375,000 ,; _ . 375,000 Maturing 2005 throudi 2009- ' | ||
8% % to 12.3% . . . . . . . . 310,000 160,000 Pollution control and industrial development bonds-due 2006 and 2007 -5.9% to 7% . . . . . 48,000 48,000 Debentures -due 1981 -4% % . 7,875 8,250 Convertible debentures-due 1992 | 8% % to 12.3% . . . . . . . . 310,000 160,000 Pollution control and industrial development bonds-due 2006 and 2007 -5.9% to 7% . . . . . 48,000 48,000 Debentures -due 1981 -4% % . 7,875 8,250 Convertible debentures-due 1992 | ||
- 7% % . . 48,381 49,998 Equipment purchase obligations 61,061 51,277 992,317 847,525 Unamortized pmnium and discount on debt-net . . . ..... ... (932) (962) | - 7% % . . 48,381 49,998 Equipment purchase obligations 61,061 51,277 992,317 847,525 Unamortized pmnium and discount on debt-net . . . ..... ... (932) (962) | ||
| Line 3,498: | Line 1,924: | ||
991,ses 73 846,563 53 | 991,ses 73 846,563 53 | ||
^ | ^ | ||
d$1,067 . TE - $1,588,736 100 | d$1,067 . TE - $1,588,736 100 | ||
, y EE g W' | |||
, y EE g | |||
W' | |||
rN | rN | ||
{' | {' | ||
I 15 - - | I 15 - - | ||
.n. -.,,.~.., ..... . :~= m:v: = m -- r - - | .n. -.,,.~.., ..... . :~= m:v: = m -- r - - | ||
$&$OSQ$%. | $&$OSQ$%. | ||
| Line 3,518: | Line 1,935: | ||
S#9WhMW-T;~.7m ?W**J~.V"W=r - | S#9WhMW-T;~.7m ?W**J~.V"W=r - | ||
._ m %a : -. .. _. | ._ m %a : -. .. _. | ||
. a, : .m . . .n a . . w v. x m . . | . a, : .m . . .n a . . w v. x m . . | ||
-+ | -+ | ||
m m?~. w ~~ r -~ ; - m--~:---m- -. - | m m?~. w ~~ r -~ ; - m--~:---m- -. - | ||
Notes to Enancial -a a n -h., | Notes to Enancial -a a n -h., | ||
~ | ~ | ||
| Line 3,529: | Line 1,943: | ||
s r ei r n, am a wis | s r ei r n, am a wis | ||
, ~. Statements .= - | , ~. Statements .= - | ||
: u. .=~-. | : u. .=~-. | ||
-. g 3 .. | -. g 3 .. | ||
: k. - - L- 2=====ry of Signiscaud - System of Accosants. -De --dag records of the Company are maintained in | : k. - - L- 2=====ry of Signiscaud - System of Accosants. -De --dag records of the Company are maintained in | ||
-[ . m7mwmm C f TAcc . . % Fe5cies ".h wie M Uh S. ystem of h.ts a >Wy ec Federal | -[ . m7mwmm C f TAcc . . % Fe5cies ".h wie M Uh S. ystem of h.ts a >Wy ec Federal p y-ng . - - | ||
p y-ng . - - | |||
-~ | -~ | ||
7 Boergy Regulatory Com====lan (PERC) and adopted by the Innunna Pubbc Semce @nminalanJN) and ee PabhepNtypunnuanian of a | 7 Boergy Regulatory Com====lan (PERC) and adopted by the Innunna Pubbc Semce @nminalanJN) and ee PabhepNtypunnuanian of a | ||
_$:v-$$M.g. [. -Q.g _. Texm (PUCT)i- " ~ ~ - " ' " '' ' ' ~ ~ ' ' ' ~ | _$:v-$$M.g. [. -Q.g _. Texm (PUCT)i- " ~ ~ - " ' " '' ' ' ~ ~ ' ' ' ~ | ||
? | ? | ||
s . | s . | ||
p#W @ . ( n. Certam amounts included in the t'nannal =tatements for 1978 have been | p#W @ . ( n. Certam amounts included in the t'nannal =tatements for 1978 have been | ||
~ | ~ | ||
| Line 3,551: | Line 1,957: | ||
p- ._ _ | p- ._ _ | ||
" " Utility and Other Plant. UQity and other plant is stated at original cost when : | " " Utility and Other Plant. UQity and other plant is stated at original cost when : | ||
F first dedicated to public service and the amounts shown do not represent repro-f duction costs or current values. Costs of repairs and minor replacements are j'' charged to expense as incurred. The original cost of depreciable utility plant F retired and cost of removal, less salvage, are charged to accumulated provision L for depreciation. The composite depreciation rates for the year ended l December 31,1979, were equivalent to: electric 3.76%, steam 2.79%, and gas l L,, 3.49%. Dunng the fourth quarter, the Company changed its composite electric L s. . . . . | F first dedicated to public service and the amounts shown do not represent repro-f duction costs or current values. Costs of repairs and minor replacements are j'' charged to expense as incurred. The original cost of depreciable utility plant F retired and cost of removal, less salvage, are charged to accumulated provision L for depreciation. The composite depreciation rates for the year ended l December 31,1979, were equivalent to: electric 3.76%, steam 2.79%, and gas l L,, 3.49%. Dunng the fourth quarter, the Company changed its composite electric L s. . . . . | ||
_i, _ depreciation rate effective to January 1,1979, to conform with the rate allowed I'~' by the PUCT. He effect of the change was to increase net income by | _i, _ depreciation rate effective to January 1,1979, to conform with the rate allowed I'~' by the PUCT. He effect of the change was to increase net income by | ||
(~ approxima'ely $1,925,000 ($.05 per share). The provision for depreciation is l | (~ approxima'ely $1,925,000 ($.05 per share). The provision for depreciation is l | ||
. computed using the straight-line method at rates which will amortize the unrecovered cost of depreciable plant over the estimated remaining service life. | . computed using the straight-line method at rates which will amortize the unrecovered cost of depreciable plant over the estimated remaining service life. | ||
Allowance for Funds Used During Construction and Capitalization of Interest. | Allowance for Funds Used During Construction and Capitalization of Interest. | ||
Allowance for funds used during construction (AFUDC) is a non-cash item which is calculated under guidelines prescribed by the FERC and is capitalized j | |||
Allowance for funds used during construction (AFUDC) is a non-cash item | - as part of the cost of utility plant representing the cost of servicing the capital invested in construction work in progress. The rate used in computing AFUDC was a 7.6% compound rate (net) effective July 1,1979. Prior to that date, the rate (net) used was 7.5%. Also see Note 1I regarding a change in 1979 of i the AFUDC rate. Such AFUDC has been segregated into two component parts - | ||
which is calculated under guidelines prescribed by the FERC and is capitalized j | |||
- as part of the cost of utility plant representing the cost of servicing the capital invested in construction work in progress. The rate used in computing AFUDC was a 7.6% compound rate (net) effective July 1,1979. Prior to that date, the rate (net) used was 7.5%. Also see Note 1I regarding a change in 1979 of i | |||
the AFUDC rate. Such AFUDC has been segregated into two component parts - | |||
borrowed funds and equity funds. That portion allocated to borrowed funds is y reflected as an adjustment of interest charges. Interest incurred by certam trusts r/? > | borrowed funds and equity funds. That portion allocated to borrowed funds is y reflected as an adjustment of interest charges. Interest incurred by certam trusts r/? > | ||
~ ' ~ | ~ ' ~ | ||
| Line 3,571: | Line 1,970: | ||
#M n with a cuim.yceding amount included as part of the borrowed funds maaaaid ' ' ~ | #M n with a cuim.yceding amount included as part of the borrowed funds maaaaid ' ' ~ | ||
.a of AFUDC. - | .a of AFUDC. - | ||
e . . . - _ . . ,,,~.,.<y g ,, mm e,.d.42f r;;... r e m ;;7. w.n | e . . . - _ . . ,,,~.,.<y g ,, mm e,.d.42f r;;... r e m ;;7. w.n p n n.a ~ | ||
p n n.a ~ | |||
~ Revenue amiFnel. The Company records revenue as biBed to its customers on WE | ~ Revenue amiFnel. The Company records revenue as biBed to its customers on WE | ||
& ~ ~ ' - | & ~ ~ ' - | ||
a cycle billing basis. Revenue is not recorded for energy delivered and unbilled | a cycle billing basis. Revenue is not recorded for energy delivered and unbilled | ||
{.p - | {.p - | ||
at the end of each fiscal period. The costs of fuel and of gas distn'buted are charged to expense as used. Rate schedules of the Company provute for p:~ , adjnetments to suhatantiaHy all rates for increases or decreases in the costs of | at the end of each fiscal period. The costs of fuel and of gas distn'buted are charged to expense as used. Rate schedules of the Company provute for p:~ , adjnetments to suhatantiaHy all rates for increases or decreases in the costs of fuel for generation and of gas distributed. | ||
fuel for generation and of gas distributed. | |||
~ | ~ | ||
Income Taxes. The Company follows a policy of comprehensive inter-period | Income Taxes. The Company follows a policy of comprehensive inter-period income tax allocation where such treatmet t is permitted for rate-making | ||
income tax allocation where such treatmet t is permitted for rate-making | |||
: k. > | : k. > | ||
purposes by regulatory bodies. Deferred Federalincome taxes, which result L .w. from timing differences in the recognition of revenue and expenses for tax and annncini armenned purpoets, are charEed to income and concurrently credited to | purposes by regulatory bodies. Deferred Federalincome taxes, which result L .w. from timing differences in the recognition of revenue and expenses for tax and annncini armenned purpoets, are charEed to income and concurrently credited to | ||
: h. p ;A{N. | : h. p ;A{N. | ||
s y:C t , | s y:C t , | ||
accumulated deferred income taxes. | accumulated deferred income taxes. | ||
g +- , .m '4 - | g +- , .m '4 - | ||
2 The Cosapany defers investment tax credits and amortizes the accumulated | 2 The Cosapany defers investment tax credits and amortizes the accumulated | ||
~ ~ halance over the usefullives of the gegdy which gave rise to such credits. | ~ ~ halance over the usefullives of the gegdy which gave rise to such credits. | ||
| Line 3,607: | Line 1,993: | ||
. ? ke. 4 . | . ? ke. 4 . | ||
p . - | p . - | ||
:W . | :W . | ||
s | s Q %. .. | ||
,g :n. . | ,g :n. . | ||
yc | yc | ||
: w. . | : w. . | ||
w | w | ||
< w M > | < w M > | ||
| Line 3,627: | Line 2,009: | ||
Under the provisions of the TRASOP, contributions may be made by the Company to the trustee either in cash or the Company's common stock in amounts up to an additional 1% % of the Company's qualified investments as provided by the Internal Revenue Code. | Under the provisions of the TRASOP, contributions may be made by the Company to the trustee either in cash or the Company's common stock in amounts up to an additional 1% % of the Company's qualified investments as provided by the Internal Revenue Code. | ||
Earnings Per Share. Earnings per share are based on the weighted average , | Earnings Per Share. Earnings per share are based on the weighted average , | ||
number of common shares outstanding during the period. Earnings per share, l assuming conversion of convertible debentures, are based on the weighted l average number of common shares outstandmg plus the shares which would l have been issued if the outstandmg convertible debentures had been converted i on the date of issue, after giving effect to the elimination of related interest l | number of common shares outstanding during the period. Earnings per share, l assuming conversion of convertible debentures, are based on the weighted l average number of common shares outstandmg plus the shares which would l have been issued if the outstandmg convertible debentures had been converted i on the date of issue, after giving effect to the elimination of related interest l expense and amortization of bond discount and expense of issue (net of related income taxes). The number of shares for the latter computation was approxi-mately 42,599,000 and 37,632,000 for 1979 and 1978, respectively. | ||
expense and amortization of bond discount and expense of issue (net of related income taxes). The number of shares for the latter computation was approxi-mately 42,599,000 and 37,632,000 for 1979 and 1978, respectively | |||
. | |||
: 2. Capital Stock and At December 31,1979,100,000,000 shares of common stock, without par Retained Earaings value, were authorized, with 42,721,874 and 38,302,420 shares outstandmg at i December 31,1979 and 1978, respectively. The changes in common stock, j resulting from public offerings, shares issued to the Employees Drift Plan (Thrift), Automatic Dividend Reinvestment and Stock Purchase Plan (DRIP), l I | : 2. Capital Stock and At December 31,1979,100,000,000 shares of common stock, without par Retained Earaings value, were authorized, with 42,721,874 and 38,302,420 shares outstandmg at i December 31,1979 and 1978, respectively. The changes in common stock, j resulting from public offerings, shares issued to the Employees Drift Plan (Thrift), Automatic Dividend Reinvestment and Stock Purchase Plan (DRIP), l I | ||
TRASOP, and conversion of convertible debentures, were as follows: | TRASOP, and conversion of convertible debentures, were as follows: | ||
| Line 3,636: | Line 2,015: | ||
' Numaber of A====e Om Number of Aamenet Ga m anus "$ | ' Numaber of A====e Om Number of Aamenet Ga m anus "$ | ||
m ares shoesands) | m ares shoesands) | ||
. Public offering 3,500,000 $38,546 5,000,000 $63,200 2,310 147,145 1,945 | . Public offering 3,500,000 $38,546 5,000,000 $63,200 2,310 147,145 1,945 Drift . . . . . . .. . 185,493 l f' . , | ||
Drift . . . . . . .. . 185,493 l f' . , | |||
326,206 4,003 187,537 2,420 l - DRIP . . . | 326,206 4,003 187,537 2,420 l - DRIP . . . | ||
; - TRASOP . 298,869 3,654 172,052 2,222 | ; - TRASOP . 298,869 3,654 172,052 2,222 Conversion of debentures . 108,886 1,590 134 2 4,419,454 $50,103 5,506,868 $69,789 At December 31,1979, the Company had reserved approximately 1,034,000 shares of common stock to be issued in connection with the nnft, | ||
Conversion of debentures . 108,886 1,590 134 2 4,419,454 $50,103 5,506,868 $69,789 | |||
At December 31,1979, the Company had reserved approximately 1,034,000 shares of common stock to be issued in connection with the nnft, | |||
, DRIP, and TRASOP. | , DRIP, and TRASOP. | ||
During 1979, the C==ny lassed 350,000 shares of $996 Dividend | During 1979, the C==ny lassed 350,000 shares of $996 Dividend | ||
~ | ~ | ||
1 7 Preferred Stock not subject to mandatary redemption. De Company's pre- | 1 7 Preferred Stock not subject to mandatary redemption. De Company's pre- | ||
, , - = ~ g ferred stock not subject to mandatary iQ is red **mahle at the option of the Company upon payment of the redemption price together with accrued u dividends. At December 31,1979, the Company had authorned 6,000,000 c. | , , - = ~ g ferred stock not subject to mandatary iQ is red **mahle at the option of the Company upon payment of the redemption price together with accrued u dividends. At December 31,1979, the Company had authorned 6,000,000 c. | ||
W .w'ss, | W .w'ss, p' r ,si :s N | ||
p' r ,si :s N | |||
24 s | 24 s | ||
k 1 ~ <rn n na s *- ~ | k 1 ~ <rn n na s *- ~ | ||
. .T-u _ . | . .T-u _ . | ||
= | = | ||
Note 2. (e--d===d) shares of preferred stock, $100 par value, cumulative, and 10,000,000 shares of authorized and unissued preferred stock without par value. | Note 2. (e--d===d) shares of preferred stock, $100 par value, cumulative, and 10,000,000 shares of authorized and unissued preferred stock without par value. | ||
Certain limitations on the payment of cash dividends on common stock are contamed in the Company's Ret.tated Articles of Incorporation and indentures. | Certain limitations on the payment of cash dividends on common stock are contamed in the Company's Ret.tated Articles of Incorporation and indentures. | ||
He most restrictive limitation is contained in the Trust Indenture, dated as of September 1,1977. He amounts which may be paid after December 31,1976, are limited to the su.n of $100,000,000 plus (or minus in the case of a deficit) : | He most restrictive limitation is contained in the Trust Indenture, dated as of September 1,1977. He amounts which may be paid after December 31,1976, are limited to the su.n of $100,000,000 plus (or minus in the case of a deficit) : | ||
the aggregate amount of net income available for dividends, as defined, accumulated after December 31,1976. The retained earmngs available for paymet.' of dividends as of December 31,1979 and 1978, amounted to l i | the aggregate amount of net income available for dividends, as defined, accumulated after December 31,1976. The retained earmngs available for paymet.' of dividends as of December 31,1979 and 1978, amounted to l i | ||
$157,251,000 and $131,490,000, respectively. See Note 3 for restrictions on i | $157,251,000 and $131,490,000, respectively. See Note 3 for restrictions on i | ||
| Line 3,671: | Line 2,038: | ||
; | ; | ||
to Mandatory Redeanytion its preferred stock not subject to mandatory redemption for shares of its $8.80 and $9.75 Dividend series of Preferred Stock subject to mandatory redemption. | to Mandatory Redeanytion its preferred stock not subject to mandatory redemption for shares of its $8.80 and $9.75 Dividend series of Preferred Stock subject to mandatory redemption. | ||
As a result of such exchange, approximately $25,847,000 (consisting of | As a result of such exchange, approximately $25,847,000 (consisting of | ||
$6,550,000 and $19,297,000 for 1979 and 1978, respectively) of paid-in , | $6,550,000 and $19,297,000 for 1979 and 1978, respectively) of paid-in , | ||
capital was r==nbad due to the difference in the aggregate par value and l | capital was r==nbad due to the difference in the aggregate par value and l exchange ratios of the series exchanged. There were no other changes in paid-in capital for either of the years. | ||
exchange ratios of the series exchanged. There were no other changes in paid-in capital for either of the years. | |||
In August,1979, the Company sold 350,000 shares of $8.64 Dividend Preferred Stock and,in January, 1980,500,000 shares of $11.48 Dividend Preferred Stock. | In August,1979, the Company sold 350,000 shares of $8.64 Dividend Preferred Stock and,in January, 1980,500,000 shares of $11.48 Dividend Preferred Stock. | ||
The $8.80 and $9.75 Dividend series are entitled to mandatory sinking funds sufficient to retire 3% of the shares of each series belnnnmg in 1984, and the $8.64 and $11.48 Dividend series are entitled to mandatory sinking funds sufficient to retire 4% of such series begmnmg in 1985 and 1986, respectively. . | The $8.80 and $9.75 Dividend series are entitled to mandatory sinking funds sufficient to retire 3% of the shares of each series belnnnmg in 1984, and the $8.64 and $11.48 Dividend series are entitled to mandatory sinking funds sufficient to retire 4% of such series begmnmg in 1985 and 1986, respectively. . | ||
The aggregate sinking fund requirement in 1984 is $1,217,000. Preferred stock { | The aggregate sinking fund requirement in 1984 is $1,217,000. Preferred stock { | ||
sinking fund provisions restrict the payment of common stock dividends and the j purchase of such stock by the Company unless the sinking fund requirements are met. | sinking fund provisions restrict the payment of common stock dividends and the j purchase of such stock by the Company unless the sinking fund requirements are met. | ||
: 4. Long-Term Debt The Company's Mortgage contains sinking fund provisions which require, generally, that the Company make annual cash deposits equal to 1.2% of the , | : 4. Long-Term Debt The Company's Mortgage contains sinking fund provisions which require, generally, that the Company make annual cash deposits equal to 1.2% of the , | ||
greatest aggregate principal amount of first mortgage bonds subsequently j authenticated and delivered or,in lieu thereof, to apply property additions or i reacquired first mortgage bonds for that purpose. De Company has satisfied the ! | greatest aggregate principal amount of first mortgage bonds subsequently j authenticated and delivered or,in lieu thereof, to apply property additions or i reacquired first mortgage bonds for that purpose. De Company has satisfied the ! | ||
| Line 3,688: | Line 2,051: | ||
The 7% % Convertible Debentures may be converted into the Company's na==an stock at a price of $14.85 per share. The closing market price of the Company's common stock at Dace =har 31,1979, was $11.00. | The 7% % Convertible Debentures may be converted into the Company's na==an stock at a price of $14.85 per share. The closing market price of the Company's common stock at Dace =har 31,1979, was $11.00. | ||
Dering 1978, the Company entered into two agreements #c 4 the Company assigned its right to p case turbine generators to certam Trusts. | Dering 1978, the Company entered into two agreements #c 4 the Company assigned its right to p case turbine generators to certam Trusts. | ||
De s,w;. providei that the Trusts would make required payments to the turbine generators' manufacturers and the Company would purchase such gener- | De s,w;. providei that the Trusts would make required payments to the turbine generators' manufacturers and the Company would purchase such gener-ators from the Trusts for an amount equal to the payments made plus certain i | ||
i b l | |||
ators from the Trusts for an amount equal to the payments made plus certain | |||
e - | e - | ||
f 25 e | f 25 e | ||
. . s_.m - ..v _. = -. | . . s_.m - ..v _. = -. | ||
~ . | ~ . | ||
~ Neeef(condamed) lifrying coats,8aa'ad == interest. Information regarding the Trusts is as follows (in'han===da of dollars): | ~ Neeef(condamed) lifrying coats,8aa'ad == interest. Information regarding the Trusts is as follows (in'han===da of dollars): | ||
apre Geesem 'Iw Gem | apre Geesem 'Iw Gem | ||
~ ~ Maturity dote (on or before) .. . 1-2-81 6-30-82 Obligation . ..... ..... .. ....... 339,565 $21,496 l | ~ ~ Maturity dote (on or before) .. . 1-2-81 6-30-82 Obligation . ..... ..... .. ....... 339,565 $21,496 l | ||
; Interest ocet . . . . . . . . . . . . . ........ 3,505 2,621 f | |||
; Interest ocet . . . . . . . . . . . . . ........ 3,505 2,621 | |||
f | |||
Average inserest race (a) . . . . . . . . . . . . 9.44 % 14.06 % < | Average inserest race (a) . . . . . . . . . . . . 9.44 % 14.06 % < | ||
1ers r Obhgation . . . . . . . . . . . . . . . . . . . $35,707 $15,570 Interen oost ...... ....... .... .. 2,595 199 Average interest rate (s) . . 9.06 % 11.89 % | |||
1ers r | |||
Obhgation . . . . . . . . . . . . . . . . . . . $35,707 $15,570 Interen oost ...... ....... .... .. 2,595 199 Average interest rate (s) . . 9.06 % 11.89 % | |||
(a) varies with the prime interest rate with the exception of the Srst $37,500,000 on the Gideon Trust which bears interest at 9% %. | (a) varies with the prime interest rate with the exception of the Srst $37,500,000 on the Gideon Trust which bears interest at 9% %. | ||
At Deccanber 31,1979, the Counpany had received approval to effect two i | At Deccanber 31,1979, the Counpany had received approval to effect two i | ||
; | ; | ||
| Line 3,728: | Line 2,071: | ||
; | ; | ||
' worig.ge. | ' worig.ge. | ||
k | k | ||
: 5. Fanployeen, ae Plans At December 31,1978, the actuarially computed unfimdad past service cost of i | : 5. Fanployeen, ae Plans At December 31,1978, the actuarially computed unfimdad past service cost of i | ||
the Company's pension plan was approximately $18,014,000 and actuanally I computed vested bene 6ts ec adad plan assets by approximately $7,065,000. | the Company's pension plan was approximately $18,014,000 and actuanally I computed vested bene 6ts ec adad plan assets by approximately $7,065,000. | ||
| Line 3,737: | Line 2,078: | ||
been c--A-2 ' 'Ibe costs of the plan charged to income were $3,228,000 and $2,211,000, and charges to construction and other accounts were | been c--A-2 ' 'Ibe costs of the plan charged to income were $3,228,000 and $2,211,000, and charges to construction and other accounts were | ||
$1,604,000 and $983,000 for the years 1979 and 1978, iWw.:y. | $1,604,000 and $983,000 for the years 1979 and 1978, iWw.:y. | ||
For the years 1979 and 1978, the Company generated inve=t=aat tax credits under the TRASOP of approximately $5,300,000 and $2,700,000, respectively. The Company accrued a liability for the 1978 contribution. l | For the years 1979 and 1978, the Company generated inve=t=aat tax credits under the TRASOP of approximately $5,300,000 and $2,700,000, respectively. The Company accrued a liability for the 1978 contribution. l | ||
'._ 'IRASOP amounts generated in 1979 will be carned forward for utihrmtion in | '._ 'IRASOP amounts generated in 1979 will be carned forward for utihrmtion in | ||
| Line 3,745: | Line 2,085: | ||
-% .,. .- . . - using the statutory rate -prismarily due to the following: 7;, 1 | -% .,. .- . . - using the statutory rate -prismarily due to the following: 7;, 1 | ||
. cr.s gwgmn | . cr.s gwgmn | ||
-y . . m. w. | -y . . m. w. | ||
~~ - ~ - - , - - | ~~ - ~ - - , - - | ||
~- | ~- | ||
.. v . v . e Q QQ,p y j. .D. ,3 <h. -e | .. v . v . e Q QQ,p y j. .D. ,3 <h. -e | ||
, , y.., g, . ~9 .,., ..,.s r M | , , y.., g, . ~9 .,., ..,.s r M | ||
.,wn &,.V . | .,wn &,.V . | ||
- - & .+, | - - & .+, | ||
u .:. | u .:. | ||
. 36.0% | . 36.0% | ||
4S.0% | 4S.0% | ||
p, . fL; . 7my:mm .m.'.. | p, . fL; . 7my:mm .m.'.. | ||
96, . | 96, . | ||
~*_ Statuaarg saae . . . . . ~ . o .+p;. . . . | ~*_ Statuaarg saae . . . . . ~ . o .+p;. . . . | ||
.. hcresses (decseases) tesuking dreau " T * " m -P | .. hcresses (decseases) tesuking dreau " T * " m -P l | ||
D 5~.hj YtY:Y $M N.%9syi":W i fS''M 'M ggg M g ' &W:' *v | |||
. . , - . _ m - | . . , - . _ m - | ||
ad W 3: | ad W 3: | ||
~ | ~ | ||
'"' equity feeds used during one- | '"' equity feeds used during one- | ||
'strussism . . m . . . . . . . . . . . . . - (20.2) (13.8) ! | 'strussism . . m . . . . . . . . . . . . . - (20.2) (13.8) ! | ||
D -;@Jm ' 9 i ' - Otsums cagdenEmed ist. book pur.: m - | D -;@Jm ' 9 i ' - Otsums cagdenEmed ist. book pur.: m - | ||
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.o y. #n .p | .o y. #n .p | ||
; tat; agemasi - . .;ier _. asaA.m_._._ | ; tat; agemasi - . .;ier _. asaA.m_._._ | ||
gy g~ggg g.g g., pgyp gw.5m | gy g~ggg g.g g., pgyp gw.5m | ||
_c - _ .+. | _c - _ .+. | ||
.c ~ | .c ~ | ||
.,.m Q L.9) | .,.m Q L.9) | ||
^'* MMD h, h )' | ^'* MMD h, h )' | ||
, n v :r-p | , n v :r-p | ||
~""? " ' ' " ' ~" | ~""? " ' ' " ' ~" | ||
#.EY.* V 4v ..w/k W .*W U M M N/Ik W N M M M N d " --$ . | #.EY.* V 4v ..w/k W .*W U M M N/Ik W N M M M N d " --$ . | ||
9,. w Tc=. > ~x: yu.~;v:wmn 1.mnO~;7-:,. * ' pw-%;p . en s.: a .? m~wmm -C: . . . r, . ~ . | 9,. w Tc=. > ~x: yu.~;v:wmn 1.mnO~;7-:,. * ' pw-%;p . en s.: a .? m~wmm -C: . . . r, . ~ . | ||
A Mu | A Mu | ||
| Line 3,800: | Line 2,122: | ||
, .i,' * . - [m ,. | , .i,' * . - [m ,. | ||
,e,. , , , .e7 g " ,.y. . ...,;,, | ,e,. , , , .e7 g " ,.y. . ...,;,, | ||
m | m urnNm-xws; -f _ _wtw m4 4.4y w r.w; a, a i | ||
urnNm-xws; -f _ _wtw m4 4.4y w r.w; a, a i | |||
pg, nxs ,. my,x_,4 g m n,+<<. 9.s,. n n.,..,% | pg, nxs ,. my,x_,4 g m n,+<<. 9.s,. n n.,..,% | ||
I mg.v.v ..n ,; aw, yn ..,ra ~-s a v | I mg.v.v ..n ,; aw, yn ..,ra ~-s a v | ||
r w;u.,m , v .H s n 10 &;tM.% y ,. ,e,ngwww,: | r w;u.,m , v .H s n 10 &;tM.% y ,. ,e,ngwww,: | ||
~x,4 f | ~x,4 f | ||
sy u.'s | sy u.'s | ||
; . m v* n : ,n | ; . m v* n : ,n | ||
^ | ^ | ||
: m. m o n s.~;W w .y m ww.% gas.,wq e | : m. m o n s.~;W w .y m ww.% gas.,wq e | ||
. m w g e'" , m w .y ., m, w .- w .' 6 : | . m w g e'" , m w .y ., m, w .- w .' 6 : | ||
(1.6) h*Wa %:- M_.u.m | (1.6) h*Wa %:- M_.u.m w y.me.r S'] _ *ww d V . Qy Q .a ._; m e M 8%,;w=% . eg'+% w%;;; . p& | ||
w y.me.r S'] _ *ww d V . Qy Q .a ._; m e M 8%,;w=% . eg'+% w%;;; . p& | |||
; .,2 fr ;- | ; .,2 fr ;- | ||
e.. - | e.. - | ||
- %.9% $7.9% | - %.9% $7.9% | ||
y.g n w pge n%!!mggwgm: yen mmwwa ==== === | y.g n w pge n%!!mggwgm: yen mmwwa ==== === | ||
l e. | l e. | ||
~ | ~ | ||
k& | k& | ||
. _-W_.S,m | . _-W_.S,m A4- e %.g g% | ||
A4- e %.g g% | |||
~ | ~ | ||
g %.m%.y | g %.m%.y | ||
| Line 3,836: | Line 2,148: | ||
-y w..~+-..- | -y w..~+-..- | ||
c-. | c-. | ||
-h.\ .p 4 f .'. + p .W %*gf( +hk*j N8h.hf k' .ld'.Y( h h bal'/,b*hMkN NNWY$hlih.. | -h.\ .p 4 f .'. + p .W %*gf( +hk*j N8h.hf k' .ld'.Y( h h bal'/,b*hMkN NNWY$hlih.. | ||
7H, ~qi>. | 7H, ~qi>. | ||
e I | e I | ||
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| Line 3,859: | Line 2,164: | ||
:g; ^ ?.n. ,. :m; ' 4,Ryn.ng :.D./w w Msnw:pM om;.ej | :g; ^ ?.n. ,. :m; ' 4,Ryn.ng :.D./w w Msnw:pM om;.ej | ||
%x , ."& .. . * ' . ,% ,.*.. . ' ~ :. ,' | %x , ."& .. . * ' . ,% ,.*.. . ' ~ :. ,' | ||
, i. . . | , i. . . | ||
~ .. n Mc K.7',n_i h / 44q R 11 :. ac. | |||
~ .. n | |||
Mc K.7',n_i h / 44q R 11 :. ac. | |||
1 l | 1 l | ||
l 89 l | l 89 l | ||
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su av e .s, | su av e .s, | ||
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''q]'[ ''(g,)p- | ''q]'[ ''(g,)p-j}gt/'g(g 9 /gs ,,fk | ||
+ _ EEm e 1,em TEST TARGET (MT-3) l I.0 sl9 m a DM a m lllIn == | |||
j}gt/'g(g 9 /gs ,,fk | |||
+ _ EEm e 1,em TEST TARGET (MT-3) | |||
l I.0 sl9 m a DM a m lllIn == | |||
l,l $ | l,l $ | ||
* llllN u \, | * llllN u \, | ||
l.25 _ | l.25 _ | ||
l.4 1.6 | l.4 1.6 | ||
* 6" MICROCOPY RESOLUTION TEST CHART | * 6" MICROCOPY RESOLUTION TEST CHART | ||
/ I+>fz | / I+>fz n > >/y | ||
n > >/y | |||
~ | ~ | ||
#w.8s 4r o | #w.8s 4r o | ||
.. v.. s 6%>s* | .. v.. s 6%>s* | ||
f 43 j,1 j - | f 43 j,1 j - | ||
L__.-_ ._..___ .._ ___._ _ __-- i. | L__.-_ ._..___ .._ ___._ _ __-- i. | ||
| Line 3,913: | Line 2,199: | ||
yean. The Company has requested the same rate-makmg treatment of these ! | yean. The Company has requested the same rate-makmg treatment of these ! | ||
costs from the LPSC. , | costs from the LPSC. , | ||
: 8. Short-Term Borrowings On December 31,1979, the Company had agreements with numerous banks F | : 8. Short-Term Borrowings On December 31,1979, the Company had agreements with numerous banks F | ||
providmg for borrowings up to $121,340,000 at the prime ca===cial landing rate in effect from time to time without payment of a commitament foe. In addition, the Company had agreements with several banks providmg for | |||
providmg for borrowings up to $121,340,000 at the prime ca===cial landing rate in effect from time to time without payment of a commitament foe. In | |||
addition, the Company had agreements with several banks providmg for | |||
; borrowings up to $36,000,000 at 115% of the prime ca===tial lendmg rate ; | ; borrowings up to $36,000,000 at 115% of the prime ca===tial lendmg rate ; | ||
;. in cifect from time to time with payment of an annual fee of 5% of prune ! | ;. in cifect from time to time with payment of an annual fee of 5% of prune ! | ||
| Line 3,925: | Line 2,206: | ||
working cash balances which generally average, over the life of the agreements, | working cash balances which generally average, over the life of the agreements, | ||
* apprormatdy 10% of the commitment. , | * apprormatdy 10% of the commitment. , | ||
? | ? | ||
$ y., . | $ y., . | ||
| Line 3,933: | Line 2,213: | ||
~ | ~ | ||
f. | f. | ||
Ed%. - | Ed%. - | ||
et e . . | et e . . | ||
s .w .. ; . , a | s .w .. ; . , a | ||
_ r -u ><e.. | _ r -u ><e.. | ||
,e m ~ | |||
,e | |||
m ~ | |||
l y .y .s' .. - | l y .y .s' .. - | ||
p _ | p _ | ||
: t. . s -- | : t. . s -- | ||
- -n | - -n | ||
,,s- .- Ye A | ,,s- .- Ye A | ||
, , v:;.) , . . .a . y | , , v:;.) , . . .a . y | ||
; ' | ; ' | ||
, ,we , | , ,we , | ||
"?:- | "?:- | ||
' h $ ,... , | ' h $ ,... , | ||
%-. ** , , : w-s w. .s . . a - i | %-. ** , , : w-s w. .s . . a - i | ||
'e 17[ ',; " | 'e 17[ ',; " | ||
3 , , , , | 3 , , , , | ||
y 37 | y 37 | ||
-' - NN 6 | -' - NN 6 | ||
P b | P b | ||
Note 8. (contimmed) Information regarding short-term debt outstanding is as follows (in thousands of dollars): | Note 8. (contimmed) Information regarding short-term debt outstanding is as follows (in thousands of dollars): | ||
1979 197s l Maximum amoitat outstandmg at any i one time $141,366 $128,971 Average daily outstandmg .. 79,186 84,110 Weighted average interest rate for amount outstandmg at year-end 14.06 % 10.27 % | 1979 197s l Maximum amoitat outstandmg at any i one time $141,366 $128,971 Average daily outstandmg .. 79,186 84,110 Weighted average interest rate for amount outstandmg at year-end 14.06 % 10.27 % | ||
Weighted average annualinterest i | Weighted average annualinterest i rate (a) . . 11.33 % 7.95 % | ||
rate (a) . . 11.33 % 7.95 % | |||
(a) calculated by dividios the sum of the effective interest for the year by the average daily short-term debt outstanding ; | (a) calculated by dividios the sum of the effective interest for the year by the average daily short-term debt outstanding ; | ||
I | I | ||
| Line 4,008: | Line 2,257: | ||
l ! | l ! | ||
and (2) that the Company's actual financing program for 1979 had not been otherwise altered due to the issuances and sale of such common stock, the earnings per average share for the year ended December 31,1979, would have been $1.66, based on a calculated average of approximately 42,722,000 | and (2) that the Company's actual financing program for 1979 had not been otherwise altered due to the issuances and sale of such common stock, the earnings per average share for the year ended December 31,1979, would have been $1.66, based on a calculated average of approximately 42,722,000 | ||
- comunon shares. Assuming conversion of the convertible debentures as of | - comunon shares. Assuming conversion of the convertible debentures as of January 1,1979, such earnings per average share would have been $1.58, r based on a calcalatad average of approximately 45,980,000 common shares. | ||
January 1,1979, such earnings per average share would have been $1.58, r based on a calcalatad average of approximately 45,980,000 common shares. | |||
r | r | ||
? | ? | ||
4-W 4m | 4-W 4m | ||
: v. , ,. . _ | : v. , ,. . _ | ||
%V | %V | ||
> 9.' ,- *w- | > 9.' ,- *w- | ||
.2s | .2s | ||
[ | [ | ||
Earmiass Per Share et comunes seeck | Earmiass Per Share et comunes seeck | ||
: 11. Quarterly F1===rl=I i | : 11. Quarterly F1===rl=I i | ||
. Infonmation (Unnented) sensd os ca7. M Average or . | . Infonmation (Unnented) sensd os ca7. M Average or . | ||
Om tomammes ===ye Not h Convertible per abarr sammunes) Oprating Operating l mevemme 3- Incomme Oswa= mar Debestures | Om tomammes ===ye Not h Convertible per abarr sammunes) Oprating Operating l mevemme 3- Incomme Oswa= mar Debestures 1M9 Fourth Quarter $216,%9 $31,912 $25,835 $.52 $.49 l Third Quarter 250,891 41,945 31,930 .72 .67 l Second Quarter 211,185 22,355 13,037 .24 .23 l First Quarter 185,297 19,098 13,379 .26 .25 ! | ||
1M9 Fourth Quarter $216,%9 $31,912 $25,835 $.52 $.49 l | |||
Third Quarter 250,891 41,945 31,930 .72 .67 l Second Quarter 211,185 22,355 13,037 .24 .23 l First Quarter 185,297 19,098 13,379 .26 .25 ! | |||
i 1Ms Fourth Quarter . 166,427 27,910 18,481 .41 .39 i | i 1Ms Fourth Quarter . 166,427 27,910 18,481 .41 .39 i | ||
*Ibird Quarter . 219,962 35,919 25,511 .69 .64 l Second Quarter 171,435 20,797 14,461 .36 .34 , | *Ibird Quarter . 219,962 35,919 25,511 .69 .64 l Second Quarter 171,435 20,797 14,461 .36 .34 , | ||
| Line 4,044: | Line 2,276: | ||
Dunng the fourth quarter of 1979, the Company changed its AFUDC [' | Dunng the fourth quarter of 1979, the Company changed its AFUDC [' | ||
rate effective to July 1,1979 (see Note 1). The effect of this change was to increase net income by approximately $2,699,000 ($.07 per share). As a result l of the FERC amending its original order (see Note 7), the amortization of ; | rate effective to July 1,1979 (see Note 1). The effect of this change was to increase net income by approximately $2,699,000 ($.07 per share). As a result l of the FERC amending its original order (see Note 7), the amortization of ; | ||
the nuclear units cancellation costs charged to operations through October,1979, and a portion in November,1979, was reversed in December,1979, thereby increasmg net income by appronmrtely $2,600,000 ($.07 per share). See , | the nuclear units cancellation costs charged to operations through October,1979, and a portion in November,1979, was reversed in December,1979, thereby increasmg net income by appronmrtely $2,600,000 ($.07 per share). See , | ||
Note 1 for the change in the electric depreciation rate. Previously reported l quarterly financial information was not restated. | Note 1 for the change in the electric depreciation rate. Previously reported l quarterly financial information was not restated. | ||
| Line 4,054: | Line 2,285: | ||
Adjusted for Changing Prices % ,. | Adjusted for Changing Prices % ,. | ||
% g l For the year ended December 31,1979 Himaarical A A l cost 1M9 1979 | % g l For the year ended December 31,1979 Himaarical A A l cost 1M9 1979 | ||
.f gn assummes) | .f gn assummes) | ||
.........................$ 864,3 3 8 | .........................$ 864,3 3 8 | ||
~ | ~ | ||
$ 864,338 ._864,338 | $ 864,338 ._864,338 l | ||
jf operating revenue Fuel . .. .. ............................... . 318,494 318,494 318,494 : | |||
l | |||
jf operating revenue | |||
Fuel . .. .. ............................... . 318,494 318,494 318,494 : | |||
FE ; 160,8827= f16Q,882.1 160,882 Purchased power . f."i7.EF.h DRM.g. . :. . . . . ! | FE ; 160,8827= f16Q,882.1 160,882 Purchased power . f."i7.EF.h DRM.g. . :. . . . . ! | ||
kW Olber operations and = alan === man '.V. .MJWA'... .r.C'139,3317' (139,331.? J ' '.139,331 i Depreciation expense '62,887 125,457 ~ 141,571 - | kW Olber operations and = alan === man '.V. .MJWA'... .r.C'139,3317' (139,331.? J ' '.139,331 i Depreciation expense '62,887 125,457 ~ 141,571 - | ||
f . . . . ...... .. | f . . . . ...... .. | ||
.......;..u.. | .......;..u.. | ||
67,434 67,434 67,434 1 Taxes ..... ... . ........... . . . | 67,434 67,434 67,434 1 Taxes ..... ... . ........... . . . | ||
i- Other income and deductions-not . ................. (29,065) (29,065) (29,065) 60,194 _ 60,194 60,194 i | i- Other income and deductions-not . ................. (29,065) (29,065) (29,065) 60,194 _ 60,194 60,194 i | ||
f Y | f Y | ||
Interest charges . ..... ... .................... | Interest charges . ..... ... .................... | ||
- 780,157 842,727 858,841 | - 780,157 842,727 858,841 Net Income (excluding reduction to net recoverable cost) $ 84,181 $ 21,611* $ 5,497 Increase in specific prices (current cost) of utility and other plant held during the year ** . . .............. ..... $ 253,328 | ||
Net Income (excluding reduction to net recoverable cost) $ 84,181 $ 21,611* $ 5,497 Increase in specific prices (current cost) of utility and other plant held during the year ** . . .............. ..... $ 253,328 | |||
, {. $(187,208) (41,157) | , {. $(187,208) (41,157) | ||
! / Reduction to net recoverable cost . . . . ......... . | ! / Reduction to net recoverable cost . . . . ......... . | ||
(383,265) | (383,265) | ||
.% f& | .% f& | ||
E8ect of increase in general price level . . m. :. r. . es.'. . . | E8ect of increase in general price level . . m. :. r. . es.'. . . | ||
Bacess of increase in general price level'EveIlmcrosselliIaL :. l .W=c .. ~~ | Bacess of increase in general price level'EveIlmcrosselliIaL :. l .W=c .. ~~ | ||
, NM. -- | , NM. -- | ||
-' - O N = ~7= | -' - O N = ~7= | ||
(171,094) | (171,094) | ||
F~~ speciSc pdces after reduction to net recoverable cost''..1 . | F~~ speciSc pdces after reduction to net recoverable cost''..1 . | ||
158,653 . 158,653 I | 158,653 . 158,653 I | ||
| Line 4,102: | Line 2,319: | ||
''' At Deceanber 31,1979, current cost of stuity and oIber amt. not of accumulated depreciataan, was $3,368,461, while lustorncal | ''' At Deceanber 31,1979, current cost of stuity and oIber amt. not of accumulated depreciataan, was $3,368,461, while lustorncal | ||
.[.f cost or met cost recoverable troush wes_,, , _ ,tM; _ | .[.f cost or met cost recoverable troush wes_,, , _ ,tM; _ | ||
p | p n | ||
n | |||
T l | T l | ||
W.,. vj $ | W.,. vj $ | ||
w 2 , , . .- | w 2 , , . .- | ||
| Line 4,116: | Line 2,327: | ||
.-m ~' _ *Q % .f . | .-m ~' _ *Q % .f . | ||
p3- | p3- | ||
. .q.ggg., ,. | . .q.ggg., ,. | ||
y | y | ||
? | ? | ||
- %.g. | - %.g. | ||
R2fb: | R2fb: | ||
va.q 7. y | va.q 7. y mii . . | ||
mii . | |||
+ | + | ||
JMa:. . , , , . _ __ __ | JMa:. . , , , . _ __ __ | ||
. . _ . ~ _ . . . _ , | . . _ . ~ _ . . . _ , | ||
P Mye Year Camparison of Selected E_..'-- , | P Mye Year Camparison of Selected E_..'-- , | ||
| Line 4,144: | Line 2,347: | ||
I GeneralInforunation Gain from decline in purchasmg power of net amounts owed 158,653 Cash dividends declared per common share $ 1.36 $ 1.38 $ 1.38 $ 1.43 $ 1.51 Market price per common share at year-end 10.41 12.59 16.94 17.31 15.36 I Average consumer price index 217.4* 195.4 181.5 170.5 161.2 l | I GeneralInforunation Gain from decline in purchasmg power of net amounts owed 158,653 Cash dividends declared per common share $ 1.36 $ 1.38 $ 1.38 $ 1.43 $ 1.51 Market price per common share at year-end 10.41 12.59 16.94 17.31 15.36 I Average consumer price index 217.4* 195.4 181.5 170.5 161.2 l | ||
l i | l i | ||
* Estunated average consumer price index for 1979 ; | * Estunated average consumer price index for 1979 ; | ||
I Constant dollar amo mts represent historical costs stated in terms of dollars of equal purchasing power, as measured by the Consumers Price Index ; | I Constant dollar amo mts represent historical costs stated in terms of dollars of equal purchasing power, as measured by the Consumers Price Index ; | ||
| Line 4,151: | Line 2,353: | ||
prices of plant from the date the plant was acquired to the present, and differ from constant dollar amounts to the extent that specific prices have increased i more or less rapidly than prices in general. , | prices of plant from the date the plant was acquired to the present, and differ from constant dollar amounts to the extent that specific prices have increased i more or less rapidly than prices in general. , | ||
l ne current cost of utility and other plant, which includes land, land : | l ne current cost of utility and other plant, which includes land, land : | ||
rights, nuclear fuel, plant held for future use, and construction work in progress, represents the estimated cost of replacing existing plant assets and was deter-mined by iMag surviving plant by the Handy-Whitman Index of Public Utility Construction Costs. He current year's provision for depreciation on the constant dollar and current cost amounts of utility epd other plant was determined by applying the Company's depreciation rates to the indexed plant amounts. | rights, nuclear fuel, plant held for future use, and construction work in progress, represents the estimated cost of replacing existing plant assets and was deter-mined by iMag surviving plant by the Handy-Whitman Index of Public Utility Construction Costs. He current year's provision for depreciation on the constant dollar and current cost amounts of utility epd other plant was determined by applying the Company's depreciation rates to the indexed plant amounts. | ||
Fuelinventories, the cost of fuel used in generation, and gas purchased | Fuelinventories, the cost of fuel used in generation, and gas purchased for resale have not been restated from their historical cost in nominal dollars. l Regulation limits the recovery of fuel and purchased costs through the opera-tion of adjustment clauses or adjustments in basic rate schedules to actual i costa. For this reason fuelinventories are effectively monetary assets. l l | ||
for resale have not been restated from their historical cost in nominal dollars. l | |||
Regulation limits the recovery of fuel and purchased costs through the opera-tion of adjustment clauses or adjustments in basic rate schedules to actual i costa. For this reason fuelinventories are effectively monetary assets. l l | |||
l | l | ||
) | ) | ||
l | l | ||
:e , | :e , | ||
I | I | ||
[ : | [ : | ||
~' | ~' | ||
. 1 | . 1 l | ||
y , | |||
A-- | A-- | ||
-( t_ . j | -( t_ . j | ||
s | s | ||
=~ %~yn d d;:u. . M. sm..scc. hnanr.Or - - - | =~ %~yn d d;:u. . M. sm..scc. hnanr.Or - - - | ||
.1. | .1. | ||
~ - em .4 | ~ - em .4 | ||
#_ 5 / e | #_ 5 / e | ||
* Note 12. (ea=d===a) ' ~As'preeczibed in statement No. 33, income taxes were not adjusted. | * Note 12. (ea=d===a) ' ~As'preeczibed in statement No. 33, income taxes were not adjusted. | ||
... Under the ratesnaking presented by the regulatory commissions to which this Company is subject, only the historical cost of plant is recoverable in | ... Under the ratesnaking presented by the regulatory commissions to which this Company is subject, only the historical cost of plant is recoverable in | ||
. , revenues as ? . !=^=-1 'Iberdore the excess of the cost of plant stated , , | . , revenues as ? . !=^=-1 'Iberdore the excess of the cost of plant stated , , | ||
~ 7 leiteiiiins'of onestant doBars or current cost, over the historical cost of plant, ils not presseth recoverstic in rates as depr=4=Han, and is rudected as a | ~ 7 leiteiiiins'of onestant doBars or current cost, over the historical cost of plant, ils not presseth recoverstic in rates as depr=4=Han, and is rudected as a | ||
-138dECODRID nSt,aBDOggsdie cost {p;the ratHasking process gives no | -138dECODRID nSt,aBDOggsdie cost {p;the ratHasking process gives no | ||
- ' secognition to the curstat cost of. replacing utElty and other plant, based on past practices, the Company beheves it_wlR be aBowed to earn on the increased cost Netles notinv==h===' when replar===ent of fadlities actuaDy occurs. | |||
- ' secognition to the curstat cost of. replacing utElty and other plant, based on past practices, the Company beheves it_wlR be aBowed to earn on the increased cost | |||
Netles notinv==h===' when replar===ent of fadlities actuaDy occurs. | |||
7ToleSect propedy the acnanEin t rate c regulation in the statement of income adjusted for changing prices, the r~W of net utility and other plant should be oEset by the gain from the dachne in purchasing power of net amounts owed. Dunng a penod of innatina, holders of monetary assets suffer a loss of general purchasing power while holders of monetary habilities experience a gain. 'Ibe gain from the dechne in purchasing power of net amounts owed is primarily attributable to the substantial amount of debt which has been used to Anance utility and other plant. Since the depreciation on this plant is limited to the recovery of historical costs, the Company does not | 7ToleSect propedy the acnanEin t rate c regulation in the statement of income adjusted for changing prices, the r~W of net utility and other plant should be oEset by the gain from the dachne in purchasing power of net amounts owed. Dunng a penod of innatina, holders of monetary assets suffer a loss of general purchasing power while holders of monetary habilities experience a gain. 'Ibe gain from the dechne in purchasing power of net amounts owed is primarily attributable to the substantial amount of debt which has been used to Anance utility and other plant. Since the depreciation on this plant is limited to the recovery of historical costs, the Company does not | ||
'have the opportunity to reahme a bokhng gain on debt and is limited to recovery only of the embedded cost of debt capital. | 'have the opportunity to reahme a bokhng gain on debt and is limited to recovery only of the embedded cost of debt capital. | ||
To the Shareholders of Gulf States Utikties Cr---+y. ' | To the Shareholders of Gulf States Utikties Cr---+y. ' | ||
~ | ~ | ||
| Line 4,209: | Line 2,393: | ||
w: . | w: . | ||
.. w: ~ . | .. w: ~ . | ||
gy | gy Houston, Texas lemmary31,1900 . | ||
Houston, Texas lemmary31,1900 . | |||
* _ | * _ | ||
. -w.a n. n- ,n, - | . -w.a n. n- ,n, - | ||
...- ~ . - | ...- ~ . - | ||
p.nMn.g[sgwn w d;Mnxuw.r~%=1 :x j;I N[ @.C e | p.nMn.g[sgwn w d;Mnxuw.r~%=1 :x j;I N[ @.C e | ||
-(f hh.[g. 3 N'h hM - '' *%d[h. ' . | -(f hh.[g. 3 N'h hM - '' *%d[h. ' . | ||
,',, ~ | ,',, ~ | ||
m . . -m. ..nx,4. .:s... . | m . . -m. ..nx,4. .:s... . | ||
. f. ,.s.. a g u .m.t.m | . f. ,.s.. a g u .m.t.m | ||
.* % e4 , . . . - .. . | .* % e4 , . . . - .. . | ||
| Line 4,234: | Line 2,413: | ||
= | = | ||
4 mI'P;* c ?. 43 ;f* ,; ' ~ ' '- .' A,*. n-' N 's<~+ | 4 mI'P;* c ?. 43 ;f* ,; ' ~ ' '- .' A,*. n-' N 's<~+ | ||
- . st ' | - . st ' | ||
s" +--[.s);p?g s -s%-% , a W^- . | s" +--[.s);p?g s -s%-% , a W^- . | ||
R- | R- | ||
>>9 e .h> , . '= E " %-- *v | >>9 e .h> , . '= E " %-- *v 4 t -' | ||
4 t -' | |||
m n y...w g.m-m. - | m n y...w g.m-m. - | ||
, .psyn ee A v sn ;m Ys_A.se ,ey e- n F' . | , .psyn ee A v sn ;m Ys_A.se ,ey e- n F' . | ||
9% - | 9% - | ||
- A<Suw ..m w m h. .~p &.&. m vn. | - A<Suw ..m w m h. .~p &.&. m vn. | ||
w7 ? - - | w7 ? - - | ||
-S "$ i % ~ '.. . i E -A *' e e | -S "$ i % ~ '.. . i E -A *' e e | ||
.qMd:-y-eN N DQMJ s ~ - . . - | .qMd:-y-eN N DQMJ s ~ - . . - | ||
7;9yW W Mhy M 2 | 7;9yW W Mhy M 2 | ||
#f j. .. M^d7 | #f j. .. M^d7 | ||
. sw ws#N.vw. %m4w.ww,m | . sw ws#N.vw. %m4w.ww,m | ||
| Line 4,257: | Line 2,430: | ||
.- - ww 4,e e,% | .- - ww 4,e e,% | ||
~ | ~ | ||
=6 u | =6 u w& m s.4ssw v 4 - -;s-.. W +- | ||
w& m s.4ssw v 4 - -;s-.. W +- | |||
, .. , 7 [ r p4 I ) '' | , .. , 7 [ r p4 I ) '' | ||
L' - | L' - | ||
h kJ 8,$.9 Mk ., ] '''4 | h kJ 8,$.9 Mk ., ] '''4 gfe Mr9mg% | ||
gfe Mr9mg% | |||
, Y [' - * ,3 - | , Y [' - * ,3 - | ||
y, n rN _, _ | y, n rN _, _ | ||
Statistical Summary I For time See years ended r Dae==har 31, IF19 i 1979 1978 1977 1976 1975 i | Statistical Summary I For time See years ended r Dae==har 31, IF19 i 1979 1978 1977 1976 1975 i | ||
Electric Department Number of Customers- l End of Year j Residential 423,850 ~ ~ 407,761 391,031 377,302 365,335 Commercial . 50,807 48,892 47,352 45,752 44,281 l 3,455 5,970* ' | Electric Department Number of Customers- l End of Year j Residential 423,850 ~ ~ 407,761 391,031 377,302 365,335 Commercial . 50,807 48,892 47,352 45,752 44,281 l 3,455 5,970* ' | ||
Industrial .. . 3,386 3,392 3,379 Temporary construction 3,279 4,304 4,389 3,404 - l Other 1,873 1,790 1,690 1,626 1,552 483,195 466,139 447,841 431,539 417,138 ; | Industrial .. . 3,386 3,392 3,379 Temporary construction 3,279 4,304 4,389 3,404 - l Other 1,873 1,790 1,690 1,626 1,552 483,195 466,139 447,841 431,539 417,138 ; | ||
Electrical Sales- l | Electrical Sales- l Thousands of KWH Residential 5,147,436 5,198,421 4,789,630 4,198,447 4,004,403 Commercial 3,759,289 3,738,114 3,486,193 3,170,084 2,949,455 l Industrial 14,961,211 14,447,417 13,216,824 11,886,799 10,530,108* | ||
Thousands of KWH Residential 5,147,436 5,198,421 4,789,630 4,198,447 4,004,403 Commercial 3,759,289 3,738,114 3,486,193 3,170,084 2,949,455 l Industrial 14,961,211 14,447,417 13,216,824 11,886,799 10,530,108* | |||
Temporary construction 44,059 42,358 23,017 14,269 - | Temporary construction 44,059 42,358 23,017 14,269 - | ||
[ | [ | ||
| Line 4,281: | Line 2,446: | ||
26,550,4f6 25,878,538 23,541,597 20,983,361 19,067,020 l Steam 3,191,464 3,012,993 2,995,619 2,818,637 2,514,086 , | 26,550,4f6 25,878,538 23,541,597 20,983,361 19,067,020 l Steam 3,191,464 3,012,993 2,995,619 2,818,637 2,514,086 , | ||
29,741,949 28,891,531 26,537,216 23,801,998 21,581,106 l i | 29,741,949 28,891,531 26,537,216 23,801,998 21,581,106 l i | ||
Average Annual KWH Use j Per Customer l Residential 12,374 13,009 12,480 11,303 11,096 ! | |||
Average Annual KWH Use j | |||
Per Customer | |||
l Residential 12,374 13,009 12,480 11,303 11,096 | |||
Commercial 75,291 77,472 74,875 70,370 67,754 Indus. trial 4,402,946 4,221,922 3,858,927 3,477,705 1,879,705* | Commercial 75,291 77,472 74,875 70,370 67,754 Indus. trial 4,402,946 4,221,922 3,858,927 3,477,705 1,879,705* | ||
Electric Energy Output-Thousands of KWH Net Generated 25,381,996 28,299,011 26,295,869 24,336,097 21,950,302 Net Purchased and | Electric Energy Output-Thousands of KWH Net Generated 25,381,996 28,299,011 26,295,869 24,336,097 21,950,302 Net Purchased and | ||
| Line 4,294: | Line 2,453: | ||
y 1*eak Imed, Includmg Inter- .. . .. , _ . , . . _ | y 1*eak Imed, Includmg Inter- .. . .. , _ . , . . _ | ||
A | A | ||
. ruptible Imad-Kilowatts 5,238@88 T.-m,.137,700?%, i5 . | . ruptible Imad-Kilowatts 5,238@88 T.-m,.137,700?%, i5 . | ||
< . 656,800 .14,160,880 .1 ~ 3,977,100 . a_ | < . 656,800 .14,160,880 .1 ~ 3,977,100 . a_ | ||
Contract Purchases at Time of Peak load-Kilowatts 6,169,808 "5,737,000 5,734,000 | Contract Purchases at Time of Peak load-Kilowatts 6,169,808 "5,737,000 5,734,000 | ||
~ | ~ | ||
5,686,000 5,250,000 | 5,686,000 5,250,000 | ||
, Annual Imad Factor ..... 68.2 % 67.3 % 68.4 % 68.7 % 65.5 % | , Annual Imad Factor ..... 68.2 % 67.3 % 68.4 % 68.7 % 65.5 % | ||
l Steata Depr tment Steam Sales-Millions of Pounds . . .. .. ... 14,796 15,787 16,987 19,346 18,772 Gas Department | l Steata Depr tment Steam Sales-Millions of Pounds . . .. .. ... 14,796 15,787 16,987 19,346 18,772 Gas Department | ||
_ TNumber of Customers-Bad | _ TNumber of Customers-Bad | ||
_. 80,116 77,260 74,350 | _. 80,116 77,260 74,350 Mai Year ....:........ 83.918 82,391 8,443,243 | ||
Mai Year ....:........ 83.918 82,391 | |||
8,443,243 | |||
; | ; | ||
i M, issius --MG . . . I: . . . . . . 9,891,331 ~ ",19,207,194i. - 19,865,995 9,781,941 ~ 7,3 f7i , . | i M, issius --MG . . . I: . . . . . . 9,891,331 ~ ",19,207,194i. - 19,865,995 9,781,941 ~ 7,3 f7i , . | ||
| Line 4,320: | Line 2,467: | ||
- . , . ; . | - . , . ; . | ||
,. 1P$r b yeess prior to 1976, botti industrial and tasaporary,cdestruction r='=ars were em as ladstrial e-e== s. * | ,. 1P$r b yeess prior to 1976, botti industrial and tasaporary,cdestruction r='=ars were em as ladstrial e-e== s. * | ||
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Principal Offices 285 Liberty Avenue Beaumont, Texas 77701 Divisions: | Principal Offices 285 Liberty Avenue Beaumont, Texas 77701 Divisions: | ||
| Line 4,362: | Line 2,496: | ||
Beaumont, Texas Manufacturers Hanover Trust Company New York, New York Northern Trust Company Chicago, Illinois Form 10-K The Form 10-K annual report to tne Secunties and Exchange Commission will be available March 31,1980. Copies of Form 10-K and GSU's 1979 Financial and Statistical Report can be obtained from Leslie D. Ogden, Corporate Secretary, P.O. Box 2951 Beaumont. Texas 777(M. | Beaumont, Texas Manufacturers Hanover Trust Company New York, New York Northern Trust Company Chicago, Illinois Form 10-K The Form 10-K annual report to tne Secunties and Exchange Commission will be available March 31,1980. Copies of Form 10-K and GSU's 1979 Financial and Statistical Report can be obtained from Leslie D. Ogden, Corporate Secretary, P.O. Box 2951 Beaumont. Texas 777(M. | ||
Notice of Annual Sleeting The 1980 annual meeting of shareholders and a special meeting of preferred shareholders will be held at 2 p.m.. Thursday, May 8,1980, in the company headquarters,285 Liberty Avenue, Beaumont, Texas. A formal notice of the meet-ing and proxy will be aailed to both the com-mon and preferred shareholders about April 4, 1980. Shareholders are invited to attend, but if they cannot, they are urged to fill out and return their proxy. | Notice of Annual Sleeting The 1980 annual meeting of shareholders and a special meeting of preferred shareholders will be held at 2 p.m.. Thursday, May 8,1980, in the company headquarters,285 Liberty Avenue, Beaumont, Texas. A formal notice of the meet-ing and proxy will be aailed to both the com-mon and preferred shareholders about April 4, 1980. Shareholders are invited to attend, but if they cannot, they are urged to fill out and return their proxy. | ||
se | se | ||
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Revision as of 02:38, 1 February 2020
| ML19323A404 | |
| Person / Time | |
|---|---|
| Site: | River Bend  |
| Issue date: | 04/14/1980 |
| From: | GULF STATES UTILITIES CO. |
| To: | |
| Shared Package | |
| ML19323A401 | List: |
| References | |
| NUDOCS 8004210185 | |
| Download: ML19323A404 (35) | |
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ing o smess sad objectivea fmm ef. fuumi perspectives. We have ened so penemt est a4ect of Gulf States in alus ammuel report by asking amt 4800 engdeynes to phonograph c ' ' he company futuu their indvidual viewpoints
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- - -- .~- -- .. - - - . ?-w T Page 2 ...Machael Wallwe, Couroc Page 6 ... Henry Joyner. Be.wmeant
- Pepe 7 .., Anna Raysiond. Lake Charles Page 9 ... Andy Dreher. St. Francisville
' Page 10.7.Bo Hamson.Conroe A{_~ *~ -
Page ll ...Bu Hamson. Conroe
' Page 12.. Joe Russian. Re=snoni d Description of the Business ausf sans utenes camp.my,-
- in henn===#, Texas, is engaged pnacapaHy in the business of generating, transmitung and &stri-butang electric caergy to 483,000 cussoniers in Southeast Texas and South Louisiane. Its 28.000 square-mile service area extends morne 4 ,. . 350 amies acunes the cesssal areas of the two
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- y. Ptut Anhur, Orange and Conroe. Texas. Gulf t States sells electricity to various ="*
and rural electric cooperatives withm Le===== 7 and Texas. In Beson Rouge, GSU seDs sneam to uulustnal customers med operases a natural gas 4 retail distribution system serving 84,000 cus-4 somers. About 60 percent of the electnc caergy
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of fuel. Gulf Stases Utilities was incorporated under the laws of Texas in 1925.
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1979 1978 'I Change Financial Highlights Income Applicable to Common Stock (coon S 68,559 $ 59,156 15.9 Earnings per Share of Common Stock Based on Average Shares Outstanding $ 1.74 $ 1.73 .6 l Assuming Conversion of Convertible Debentures $ 1.65 $ 1.62 1.9 I Dividends per Share $ 1.36 $ 1.24 9.7 Average Common Shares Outstanding noo) 39,310 34,265 14.7 Total Operating Revenue nxos $864,338 $717,958 20.4 Operating Expenses and Taxes nxo) $749,028 $613,523 22.1 Number of Electric Customers 483,195 466,139 3.7 Total Kilowatt.llour Sales gn)) 29,741,949 28,891,531 2.9 System Peak Load - Kilowatts 5,229,300 5,137,700 1.8 I ], PERCENTAGE INCREASE IN CONSUMER PRICES January 1970 thru November 1979
." Medical Care Transportation l Electricity y
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Dear Fellow Shareholders nespite double digit inflation and in each case the owners will share pro- l 1./ 15 percent interest rates, net portionately the costs and power output ! income and dividends increased in of the plant. When these groups start 1979. Revenues were up significantly. funding the project this year, GSU's { l Earnings per share of common stock capital needs for construction of this i increased slightly to $1.74 as compared unit will be materially reduced. l to $1.73 in 1978 when there were 13 } percent fewer shares outstandmg. In a similar arrangement, Sam l l In 1980 the company will benefit _L Rayburn Dam Electric Cooperative l from a $20.8 million Texas rate increase and the company are negotiating Sam l which went into effect in November, Rayburn's acquisition of 30 percent and the resolution of three other rate of the $450 million,540 megawatt i increase filings that should be acted Nelson No. 6 coal unit scheduled for i upon by regulatory bodies during the completion near Lake Charles, La., , year. The three include'a request pend- in 1982. l ing before the Federal Energy Regula- Additionally,I am pleased to report j tory Commission (FERC) for a $1.2 that the company's last oil / gas fired ! million increase in the amount GSU unit - Sabine No. 5 rated at 480 mega- l charges other utilities to transmit elec- watts - was completed in December. l tricity on the company's lines. FERC is With the possible exception of small allowing us to put this rate into effect units used primarily to serve peak April 1, subject to refund, if it is not loads, future units will be fueled with l granted in total after formal hearings. lignite, coal or uranium. Additionally, we have filed with the Earnings per share did not show the Louisiana Public Service Commission expected increase in 1979 for a number (LPSC) for a $3.4 million revenue of reasons. Our service area experi-increase from our 84.000 Baton Rouge, enced an unusually cool summer,15 i La., area gas customers; and for a $98.9 percent cooler than 1978 and nine per-million annual revenue increase from cent cooler than normal. Conservation our 240.000 Louisiana electricity efforts also are beginning to have per-customers. ceptible effect on sales. The most The Louisiana electric request important consideration, however, is includes a motion asking for a $27.3 the high rate ofinflation w hich million interim increase based on a level of earnings previously authorized NET INCOME by the Louisiana commission, but the !
.m nullens) company has been unable to reach this levellargely because of rapidly esca- ,
lating costs. Another major event in 1979 that creates positive expectations for 1980 centers on the partnership arrangement
- for owning the 940 megawatt River Bend nuclear power plant GSU is building on the Mississippi River near St. Francisville, La. Cajun Electric Power Cooperative is acquiring 30 per-cent ownership position in the $1.7 bil-lion nuclear unit. Sam Rayburn G&T and Sam Rayburn Municipal Power Authority - both affiliates of Sam Rayburn Dam Electric Cooperative in Texas- are acquiring seven and three percent respectively. Another group of municipalities is considering the acqui-sition of an additional three percent.
1975 1976 1977 1978 1979 l l Lights come on at the Lewis Creek Generating l Plant near Conroe, Tesas. In the centerfore-l ground is she cochng mater canalfor theplant. l 3
t l l l l adversely impacts all our costs, plus T would like to devote the balance
- Shareholders (continued) 3. of this letter to a discussion of major inadequate and untimely rate increases l from some regulatory authorities. organizational developments that have I
Re company successfully com- occurred over the last two years. These i pleted modifying the indenture to our changes and the resulting efficiencies , l first mongage bonds. This removes the permit us to enter the new decade with [ I limit of 51 billion for the aggregate the firm conviction that GSU,in the l value of bonds outstanding. long term, will be able to provide reli-l able electric service at reasonable costs l l and to maintain a good record of Qur preferred stock and first mort-l N./ gage bonds were downrated by earnings. Standard and Poor's and Moody's. He changes can be viewed basical- l Both rating services cited our expen- ly as a two-year reorganization of the sive, but necessary construction pro- management structure. Panicular empha- , gram- 5400 million this year alone - sis was placed on building an organiza- l tion to cope with the new and rapidly i and uncenainty concerning rate relief from the Louisiana commission changing demands placed on an elec- [ as prime reasons for the downrating. tric utility such as Gulf States and on j The lower ratings translate into higher developing systems and procedures to i interest rates and preferred dividends reduce costs. It was also necessary to ! which must be paid ultimately by our increase our ability to communicate l more effectively with r.ll segments of ; customers. Fortunately, there are indications the the public and to recognize and deal l leuisiana commission is moving away with energy problems more from holding rates at unreasonably low expeditiously. levels and taking a full year to act on To meet the financial and regulatory I rate requests This is evidenced by the challenges of the 1980's, our financial rate increase granted to GSU and put organization was restructured with i into effect January :,1979, which was Accounting, Finance, Rates and Plan-l ning consolidated under an executive then the largest ever granted an electric utility by the LPSC, and by other rulings vice president. Pan of this restructur-handed down by the commission in ing led to annual savings of 5600.000 1979 concerning other electric utilities. by improving cash management w hile EAILNINGS PER SilARE , l Based on Average Shares Outstanding 4 - f. ,
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1975 1976 1977 1978 1979 4
I River Bend unit, which willbe built with total dedication to safety, must be short-terminvestments added more organizationally positioned to provide than $200,ro0 to cash earnings in 1979. , Development of an internal capability thatthebesteffonsof thecompany in the area of rate design and cost and of its panners are brought to bear on l service studies brought a savings ofthe project. To accomplish this,theRiver , Ben t
$100,000 in consultant fees, System Operations were consoli- under the management of an executive !
dated under an executive vice presi-vice president. This new group, which J dent, providing centralization and will report directly to me, will devote [ its entire resources to assuring that the ; close coordination of activities plant is built with a maximum safety j involved in the operation of an electric l utility spread over 28Joo square miles commitment and that every effort is 7 in two states. Because of today's com-exened in completing the 51.7 billion i plant on schedule. r plexity of fuel pricing and purchasing ; buik power supplies, a Power Supply
. Department within System Operations Administrative l'1 revamped andServices now provide weremajor l was developed.The depanment con-tributed to a 50 percent reduction in cost savings for the company. For l the use of fuel oil -our most expen- example, a Risk Management Depan-in 1979. ment has improved insurance rates the sive fuel company pays to the point that $1.25 The accomplishments of 197 The Consumer Services staff was million is saved annually. Materials reorganized to greatly expand the flow opportunities for the of information to customers. Very suc-Management expanded its salvage cen- I cessful" Energy Stores" were opened ter and is saving $100.000 a year by tion and hardTheir workefforts of 4.
in Beaumont and Baton Rouge to show reconditioning equipment. employees. customers how to conserve energy. OurPublic AffairsandConsumer appreciated. Solar and air conditioning studies were Affairs activities have mereased dra-Sincerely, instituted and energy audits of homes matically to adequately inform law-makers, cusromers, the public and the ' implemented. financial community of the many and ' expandingissues that affect GSU. Results of these activities arereflected in privately many conducted Evaluating and implementing , of our major decisions and policy public opinion surveys that show actions is a Management Council made favorable public opinion of GSU W. Donham Crawford increasing 20 percent to nearly 80 up of nine senior officials. The follow- Chainnan of the Board and percentin 1979 alone. ing section of this annual report is Chief an Execuuve Officer System Engineering was stream- interview with the councilmembers lined, eliminating duplication, improv-reflecting our direction for the 1980's. ing pmductivity, upgrading mainte-Iinvite you to read it closely. _{ nance schedules and establishing I regret to report that two directors, stronger cost control procedures. who aidedin establishing our course Division Operations expanded ser-for the 1980's. left the board in 1979. vice to customers throughout the sys- AnhurTemple, chairman of Temple-i tem and improved response time to Eastex, and vice chairman of Time,
{ calls. Follow-up surveys indicate 95Inc., resigned because of pressing time 4 i constraints imposed by his own busi-
.I percent of our customers who call ness usactivities. Also, Charles Man-are satis 6ed with the service they i
receive.Takingadvantageof new ship, Jr., president of the Baton Rouge technology, division personnel saved Capital City Press, retired. Dr. Frederic
$1.5 million on a single, large electric A. Holloway of Baton Rouge, who recently retired from Exxon as vice E"
transmission installation. The River Bend nuclear plantis thepresident of Science and Technology, mostimportant project the company has been elected to the boad. "' extensiveknowledgeof(? m gy has ever undenaken.The cost of the field be is a valued asset w . Yard. plant is high, but the fuel cost will farlower than the alternatives.The i
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Management Council utf States' Management Council and $150 million in bonds in an effort is a nine member group of senior to achieve more acceptable debt to InterVICW company officers that meets weekly. equity ratios. Additionally, the com- 1 The council acts to assure coordination pany filed four major rate cases with ! of management decisions. The Man- regulatort bodies in the course of the { agement Councilis chaired by W. year and negotiated a $20.8 million ; Donham Crawford, Chairman of the annual revenue increase settlement in ) Board. Following are excerpts from the Texas rate case only four months j interviews with members of the Man- after it was filed. Additionally, that . agement Council and reflect major settlement includes a $4.1 million 1980 areas ofinterest to shareholders. revenue increase for certain purchased , pow er contracts. Thomas H. Burbank (Senior Vice [ Q: In last year's annual report Mr. President-Rates and Economicsk i Crawford indicated the greatest chal- Adding to w hat Joe says, it is impor- j lenge facing the company and the tant to realize that financing would j industry is financing. Does that hold be much easier if we - true a year later? were receiving an adequate rate of return - Joseph L. Donnelly (Executive Vice President-Finance): Absolutely, and on our investment in g all regulatoryjurisdic- - w hile we have a long way to go, w e tions. Therefore, con-made substantial progress m 1979, par-s derable emphasis (W l ticularly with the was placed on rate fil- Burbank financial participation ings in 1979 and will continue in 1980.
- ;.
of the two coopera-tives in the $1.7 bil- Mr. Donnellv That's correct. Financ-lion River Bend nucle- ing is so crucial ic the years ahead, ar plant. Their total given our large construction program, i of 40 percent parti- that rates and planning are extremely Donnelly cipation will relieve important. Accurate forecasting of our us of about $680 million in construc- physical plant needs, money needs and tion costs over the next four years. manpower needs is an absolute neces-That is about the equivalent of the cost sity. To meet those needs we are putting for a major coal-fired power plant. strong emphasis on an accurate com-We are nearing agreement with Sam puter program of what the company Rayburn Municipal Power Authority looks like when it i, reduced to num-on its potential acquisition of 30 per- bers. This corporate modelis becom-cent of the Nelson 6 coal unit that ing an excellent planning tool. would relieve us of about another $140 million. Yet, even though we will be , sharing the capacities of the power q; - plants, we will be bringing the capac-ity GSU needs on line at the time @het L
" Financing is so crucial...
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that rates and planning are "
\'4 extremely important."
needed. That is based on forecasts of i about five percent load growth annu- , ally which translates roughly into 300 megawatts of needed capacity each year.
- During the year we issued $120 mil-
! lion in common and preferred stock Steel skeleton ofNelson No. 6 coal unitflanked GSU's Atanagement Council From left stand. by stack and cooling toner. l ing- Thomas H. Burbank. Eduard M. isggins. Im rence L. Humphreys. From left seated: Fred C. Repper. Dr. E. Linn Draper. Joseph E. Bondurant and Joseph L. Donnelly. BamrJ Chairman W D<mham Crawford and Preudent Norman R. Lee not shou n. 7
i InterVICW(continued) Dr. E. Li- Draper (Vice President Mr. Donnelly: I agree with that. Build- ) and Technical Assistant to the Chair- ing coal and nuclear plaats is difficult l
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man of the Board): Financing is crucial in that it slows the company's cash because we are operating in a situation earnings growth in the short run, but I where we must avoid am convinced the company will end i
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using increasingly (E scarce and expen;ive oil and gas. That
** ...it has great potentiai f
.b benefit to stockholders..." i means building alter-natives - coal and ;
g4 the '80s financially stronger than at I Y nuclear plants. The Draper two generating sta- any time in its history. tions underway have a capital cost as Joseph E. Bondurant (Executive Vice great as all the pow er plants we pres- President-Operations): When we hase ently have combined. It is a challenge the coal and nuclear plants on line, it to finance expansion that took 50 years will g ve us much more operating ! with its equivalent m half a dozen years. flexibility. We will O. That sounds impossible. Can it be be able to get the max- , done at all? imum output from the $ i
# " "E Norman R. Lee (President and Chief ""fc'g'," f, '#J Operating Officer): T,es, but not with- any given time. That is l out some difficulty. If you could assure me that gas and oil would be abundant an obvious benefit to the customers because
\1 Bondurant
< in the future and not of lower fuel costs passed on to them.
g - more expensive than today, I would say And it has great potential benefit to stockholders, because our exposure to
- " stick with them. ,
. government mandate is minimized.
But you can t. That is The government can make any rule it impossible. Coal and wants on a particular fuel, but ue will nuclear are going to be able to keep selling kilowatthours run. L k at the e cos f a o her fue s to 11 Ln oil. % hile gas and oil plants are ch:ap-er to build, the fuel costs will eat > ou Fred C. Repper (Vice President-Public ; alive in the long run. Affairs): It is interesting to listen to the answers to this one short question. The answers illustrate the large and grow-r : - p ingcomplexityof this NMN business. From my "UI") viewpoint, it increases Q:N-U I the need to communi-cate such complex information succinct-g i; ly and accurately to Repper both our customers f- and our lawmakers. Q p 5225 The issues are complex and many [. 52r times lawmakers can be preparing to act without really being aware of the
$173
( , consequences to the company and its j t ;i customers. That is why we have increased dramatically our efforts to communicate with customers and all
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[ levels of government officials. If the D ( 3,75 19% N7'7 1978 1971 195) true implications of an issue are under-stood, the inherent good sense of the p hdessephd Putervoc - <p=== o
- American people will prevail.
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Q. Narmwing our Ieus on financing Afr. Humphrey3:The major lesson -- - and government regulation brings us to learned w as that greater attention must t the highest priced and most regulated be paid to operator training and i project the company haw the $1.7 bil- authority. i ( ' lion River llend nuclear unit on which k s A construction was resumed shortly af ter Un UNPm Becam nudear plants .z , n
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- a the Three Mile Island accident. Would mn ne r fuH pown most of the time, __
somebody care tojustitv that?
}"" don I have ups and dow ns. Even _. T airl,me pdots get to take off and land, Dr. Draper: T hat's easy. Joe llondur-
' but nuclear power plant operators may . ant answered a segment when he spoke go for days or weeks just h)oking at '- of flexibihty, but there are other fac- gauges and making small adjustments. . ' ? i, i tors. Initially the cost is high, but oser They might get stale. i~ ' the hte of the plant it will sase custom- # -h ers tens of millions of dollars. Nuclear Afn Hunphrq Our operaton w W be - -
-- os - VV plants in 1978 generated electricity trained and permdically retrained on -
2 < about 30 percent cheaper than coa'! and mn nom umWamdat d N w y,,, c,,,,, l at lew than 50 percent the espense of ci se to the actual contml room that g, g,, ,,,,,,,,gy ,, , r,,,,,gy, ,, gy,,,
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oil-fired plants. the untrained eye probably couldn,t detect w hich was the real control room , Afr DonncH3: Despue the long term and which was the simulator. When sasings, it does impose a burden on the company to raise the funds. The only o ihmma by signing the Nuclear wa) is through prompt and reasonable ,re going for 1984 1. abor Stabilization Agreement w'ith rate mcreases f rom our regulatory and we intend to make it." the crafts insols ed. That agreement commiwiont Yet, I point out that calh for no strikes, no slow-dow ns, a while the cost of buildmg a nuclear our operators are trained, I firmly two alternating crews of craftsmen plant is about twice as expensise as believe they will be able to correctly each working 10-hour, four-day work coal. fired plants, you make up those handle operating abnormalities that weeks so ; hat we get 70 hours of con-cost differentials by having lower fuel they neser experienced in training. struction per w eek. c y nse. Q. Is R ser llend similar ta Three Mile UmPer: Ily sirtue of this agree-Lym rcm c L. Humphrcp ( thecutive Island., ment there is a sen good possibilits ice Pres,i dent River llend Nuclear g g G{roupt The government is Mi. H caretolly b- Only in that it uses llut it is a sery long fise9 ear con. contmlling the nuclear mdustry md a uranium as a f uel and w ater as a struction program and there are no coolant and moderator. In fact, the sys- guarantees. is an expensive ou ness. The iwucs of mm that failed on the TMI unit doeskt Hs mp ou look at the cri-nuclear safety and esen exist on Riser llend. Ilowever. any nuclear pow er plant accident pro- tic 1 path . -hedule that we base and cost were the factors E the Riserllend Nucle- vides generic information we can learn pn etMty to date, I don't see w hy in the boardof direc- , from We learned a great deal about we can t m ke ,t. i But 1. inn is right, fors' decision creating how to communicate with the govern- I*""""E""'""'"""" # i ""' ment and the public. We learned a constmet n pmgram and we know Humphren ar Group. T he prime great deal about management depth. that over the course we will run into concern of the board w as that this problems. group hase the necessary tools, with That education is being factored into the Riser llend nuclear group. The most serious would be a major no impediments, to has e absolute regulatory change. Ilut Ido know if we dedication to safety. Q: Given the industry's inability to set 1985 as a comp!erion date, it Obsiously, the TMI accident had complete nuclear power plants on wouldn't be finished one day before. some impact on the board's thinking, schedule, what makes you think River That's human nature. Today w c're , but I suspect the group would has e llend will be completed on time? poing for 1984 and w e intend to make it. i been created had there been no TMI. I T here has alw a)s been an insistence & UumP hreys: First of all, wk at Afr. Lee: There is an additional reason that the River llend project be the best our track record. We said we would to get River Bend on line as smm as i powible from the sicwpoint of safety bring Sabine 5 on line in 1979; we did. possible. We live in a world of energy i and finance. e are on schedule with Nelson 6, a uncertainty in w hich we are forced to i coal unit and a type we has e never react to Washington and the od export- ! Q: That brings up the obvious question built before. We have made a concen- ing nations. When you are dependent ! of w hether or not you learned any thing ) trated commitment to River Bend both on other people, you had better tighten from the TMl accident. in the management aspect and in the your belt and do w hat needs to be done. l 9
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I Louisiana Public Service Q: Does that include customers? sion's consistent attitude against g ' InterViCW(continued; ing rate increases in reasonable tin Edward Af. Loggins (Senior Vice Pres-l ident-Administrative Servicesi: I stay 6 arm) t ' j very close to fuel prices day in and day Afr.Burbank: Utility regulation ha , out so I think I can answ er that. People Iwa goals. Regulators have the r must learn to live with sibility to make sure we are provid '
# higher energy costs service at the lowest possible cost.
I
% and that includes elec- second goalis to see that rates are !
I tricity. It is and will w continue to change reasonable and fair in the
.he company is allowed to earn an their pattern of living.
quate return for its ins estors. I b (Y ,, But I think that is con-that the Louisiana com toggins siderably different responding positively, as evidene than changing their standard of living. partially by the increase gran Conservation, in the home, office and December,1978, and other rulini l in transportation is happening now. made in 1979. i i Afr. Repper Ed's answer is the basis of Afr. Donnelly:The commission why the majority of our advertising is understand that not granting reas ! aimed at showing people how to con- able increases,in the long rur. l a serve. And it is why the company decreases our bond ratings as h opened "The Energy Store" at shop- pened in 1979. Bond ratings afft ping malls in both Baton Rouge and interest rate when we issue b Beaumont. We went to the people to we have to pay an extra half per show them how to conserve. I doubton,if for instance. $50 million in you can find any other stores in the mortgage bonds, that translates
$250.000 a year in extra interes ;
" Gulf States can expense that goes on for the lif(
materially case the shift bonds which may be 30 years. from oiI and gas..." Who pays that ultimately? T customer. And who does it affe most? The low income custom
, country where you have trained staffs may be able to conserve, but ci dedicated to showing customers how cannot do without electricity.
to use less of the company's product. We feel as a company that we have an Afr. Repper: Inflation of energ obligation to show our customers how including ours, have seriously i to use energy more efficiently.
-.<me --
Afr. Bondurant: In a broader scope, the
, gradual withdrawal of oil and gas from .$dh3@{
" ~
our energy diet will potentially lower i
} our standard ofliving unless other sources can be brought on line swiftly enough to minimi ze that impact.
Itis difficult to see whether or not financial constraints will further limit our ability to help ease this problem. More electricity from alternate sources definitely would help and technically we can generate, transmit and distrib-ute electricity more efficiently than ever before. Gulf States can materially case the shift from oil and gas if w e are financially allowed to do so.
' Q: Willit not be difficult to achieve the company's goals in light of the Lewis Creel she same power plar on page 2. rises from a serene po north of Houston.
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Lmemen work on distr +ution system in
} company's Western Division as part of our i
ongoing expansion program. II
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l IntelYlCW(continued) W'MN"'mem+%-- - and gas properties in Mississippi and l M404 Alabama. At the same time, Varibus ' mq pegyw - is exploring a number of potential ura- ! i asahwMEh
.1y&P @@* ~ m nium ore sites. While Varibus is not a l large revenue producer yet, it holds !
NMh mwct;; Promise for both further expansion and diversification. a ,awtTt=~ 3
~ * ^~i , Q: One last question. Why didn't 1979 live up to financial expectations?
Afr. Burbank A prime reason was weather. The summer, w hen we sell the most kilowatthours to meet the air conditioning demand of our customers, was unusually cool. Afr. Bondurant: There also are ef(cets
? IM5 ' IME 4 IFF7 f IM511979 of conservation that are impacting the
- anocessansc==Mumme v company. It is very difficult to quan-ausedu amomens As bonused fumes. .
. wp wm um u.1 m tif), the kilowatthours not being used because of individual conservation, low income and thed income indi. but we know they exist and we are l
viduals. For this reason we feel an trying to develop accurate data. obligation to work with city and state authorities to communicate conserva. Afr. Loggins: Also, inflation is panicu-i tion information, and we are support. larly insidious to a utility because in-l ing legislation to help augment the creased rates to compensate for higher l abihty of these groups to pay for costs are not granted until rate hearings energy in all forms. are completed before regulatory com-missions. That can be six months to a Afr. Lee And there is another means year after the higher costs are incurred. of developing internal finances. Varibus, our wholly-owned subsidiary, Afr. Lee: In the light of w hat was a produces revenue for the company difficult year, I think we did reason-primarily through energy exploration ably well, Granted it was not what we and development. In 1979 Varibus wanted, but our employees did a most was heavily engaged in developing oil competent job.
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k i I SurmersforJ a Louisiana bayou in eforts to stake the pathfor new transmisswn lines. l 13
- John W. Barton Monroe J. Rathbone, Jr.
Directors President 4ack's Cookie Company Medical doctor and partner.The Surgical Baton Rouge. La. (1970) Clinic Bat n Rouge La. (1975)
*W. Donham Crawford Chairman of the Board Lorene L. Rogers and Chief Executive Officer President Ementus, The Unisersity of Texas Beaumont, Tx. (1977) at Austin Austin. Ts. (1976)
E h in H s *Nathaniel S. Rogers Investment Adviser Boston. Mass. (1959) President First City Bancorporation of 8* Dr. Frederic A. Holloway [,,**(d,N,Nr fi2,*,0, Consultant Houston. ix. (1978) Retired Exxon Vice President-Science and Technology
- Bismark A. Steinhagen Baton Rouge, La. (1979) Panner Steinhagen Oil Co.
8'*"""I'"'" William H. LeBlanc, Jr. President Baron Rouge Supply Co.,Inc. James E. Taussig 11 Baton Rouge La. (1974) Realtor and real estate developer me azries. (19 Si Norman R. Lee President and Chief Operating Officer ** Benjamin D. Orgain Beaumont. Ts. (1967) Member-Orgain, Bell and Tucker, General Cmnsel t the con 1 pay
- Paul W. Murrill '*""'
Chancellor-leuisiana State University at Baton Rage
- Executne Committee Baton Rouge. La. (1978) ** Advisory Director Alvin T. Raetzsch. Sr. ( ) Year Elected Assistant to the Vice President and General Manager . U.S. Chemical Dnision of PPG Industnes. Inc.
Lake Charles. La. (1975) Chairman Fred C. Repper (1) [52] Officers Vice President-Public Affairs W. Donham Crawford (2) 156] Gainnan f the B ard and Chief Executive Edward J. Serxan (1) (58]
# Vice President-Fuels and Matenals*
President Aubrey D. Sprawls (30) [51] Norman R. Lee (31) (55] Vice President-Consumer Services President and Chief Operaung Officer Summa L. Stelly (31) [54] Executive Vice Presidents Vice President 4ouhiant Operanons Joseph E. Bondurant (22) [50] J. Gary Weigand (2) [44] Executive Vice President-Operations Vice President-River Bend Operations and Technical Systems Joseph L. Donnelly (1) 150] Executive Vice President-Finance Jasper F. Worthy (24) [51] Vice President-General Services Lawrence L. Humphreys (3) [43] Executive Vice President-River Bend Division Vice Presidents Nuclear Group John W. Conley (22) [48] Senior Vice Presidents Division Vice President. Western Thomas H. Burbank (1) (58] Calvin J. Hebert (17) [45] Senior Vice President-Rates and Economics Division Vice President-Baton Rouge Edward M. Loggins (21) [49] Arden D. Loughmiller (19) [42]
- Senior Vice President-Admmistrative Services Division Vice President-Beaumont Joseph R. Murphy (43) [64] J. Ted Meinscher (19) [47]
Senior Vice President-Production Division Vice President-Port Arthur Vice Presidents William E. Richard (29) l50] William E. Barksdale (22) [48] Division Vice President IAe Charles Vice President. Technical Services gg g Philip T. Boerger (1) [55] Francis J. Andrews, Jr. (1) [36] Vice President-Fossil Projects
- Controller James H. Derr, Jr. (39) [59] leslie D. Ogden (24) [45]
Vice President-Power Plant Engineenng Corporate Secretary and Design Bobby J. Willis (18) [44] Dr. E. L.mn Draper (1) [38) Treasurer
- Vice President and Technical Assistant to the Chairmanof the Board
- Roy E. Eyler (21) [55]
Assistant C rp rate Secretary Charles D. Glass (30) [51] Vice President. Texas Operations g ) ye,,, or 3,,yie, g j ,,,
- Effective February 16. 1980 leslie M. Moor (8) [48]
Vice President-Human Resources 14
l ~ .l.;aj k. hqJup:L ca= i:: }{} ;- 33 - . - . y- -- - - n . . - . - , Financial Section ' rana ==a= f k Management Responsibdaty for Pinancist kata==r= .. . . 15 l [ L Th==='y of Operadoes . ... 16 L - Nn=an Rock Prices and Cash ~ Dividends Per Biare . .~, . . . . . . 16 ( [g . . :z . - g_ _qgg.a : - - '- Analysis of the *----- ny of Operations 17 f ( e matamant of Inconie . ..... 19 l Sources of FundsInvestedin Utility and Other Plant 20 j Statement of Retamed Earmngs. 20 l i Balance Sheet . 21 Statement of Capita 1mation 22 Notes to Financial Statements 23 t Auditors' Report 31 Statistical Summary 32 l I Management Management is responsible for the preparation, integrity, and objectivity of I Responsibility for the fonowing financial statements of Gulf States Utilities Company. The statements have been prepared in conformity with generally accepted accounting Financial Statements principles and, in some cases, reflect amounts based on estimates and l judgment of management, giving due consideradon to materiality. l The Company maintains a system of internal controls designed to help give reasonable assurance that the books and records properly reflect the l transactions of the Company and that established policies and procedures are followed. Internal control systems are subject to inherent limits in recognition of the need to balance their costs with the benefits they produce. The Company's management strives to maintain this balance. l Coopers & Lybrand, independent certified public accountants, are engaged to exanune,in accordance with generally accepted auditing star. lards, the
; Samacini staraments of the Company and issue a report thereon, which appears ; on page 31',5mch auditing standards include a review of internal accounting controls, a test of transactions, and other procedures sufficient to provide reasonable assurance that the Anancial statements are neither matarially ;, ] gor enntain matarial grega. ; fIhe Board of Directors, through the Audit Committee of the Board, has ,
generaloversight of management's preparation of the financial statements and is . responsible for engaging, subject to stockholder approval, the independent l accountants. 'Ihe Committee reviews with the independent accountants ' the scope of their andets and the accounting principles apphed in financial i k p _ reporting. 'the Audit Committee meets regularly, both separately and jointly, 9^,- %" ..
' with ':';--- ' accountanes, representatives of management, and the l
[e; g ?.; u -e' gnednet anators, e review activides'in ea==acdan with Anancial reporting. I
" ~ '
I Ihe i=daaaad--' accountants have full and free accus to meet with the Audit
. 'c ,,,i,,--
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1 - . - % N _ eves M m escass the resaits of their aramin Son and their opinion on the adequacy of internal J - 1 accounting controls and the quality of financini reporting. p . m- . p , e 3:. .. ,. . L u- l s i . { r i 15 f.
Summary of Operations For the ave sears ended December 31,1979 Da thousands except per share announts and KWH sales) 1979 1978 1977 1976 1975 Operating Revenne $864,338 $717,958 $587,760 $447,739 $362,234 Operating Expenses and Taxes Fuel 318,494 316,559 257,013 183,190 125,007 Purchased power 160,882 54,501 30,931 8,481 5,982 Other operations and maintenance 139,331 107,239 84,698 64,519 55,878 Depreciation 62,887 62,573 59,882 53,717 50,060 Taxes - net 67,434 72,651 65,387 53,245 47,147 749,028 613,523 497,911 363,152 284,074 Operating Income 115,310 104,435 89,849 84,587 78,160 Other Income and Deductions Allowance for equity funds used during construction 27,260 15,710 15,072 13,110 8,161 Other - net 1,805 (290) 4,443 (445) 970 Income Before Interest Charges 144,375 119,855 109,364 97,257 87,291 Interest Charges , Long-term debt 68,784 59,485 53,622 47,078 40,539 Other 17,539 7,010 2,931 4,403 6,796 Allowance for borrowed funds used dur-ing construction (26,129) (16,786) (12,839) (10,640) (9,737) Net Income 84,181 70,146 65,650 56,411 49,693 Dividends on Preferred Stock 15,622 10,990 10,576 6,730 6,730 Income Applicable to Common Stock $ 68,559 $ 59.156 $ 55,074 $ 49,681 5 42,963 Average Shares of Common Stock Outstanding 39,310 34,265 32,637 32,214 27,547 Earnings Per Share of Common Stock Based on average shares outstanding . $ 1.74 $ 1.73 $ 1.69 $ 1.54 $ 1.56 Assuming conversion of convertible debentures 1.65 1.62 1.65 - - Dividends Per Share of Common Stock 1.36 1.24 1.15 1.12 1.12 Electric Sales (in Millions of KWH) 29,742 28,892 26,537 23,802 21,581 Common Stock Prices & essa and Cash Dividends Per Share
'"' " M '"'
y,, g ,,,,,,,,, Fourth Quarter $12% $10% ""$ .'34 Deceanber 31,IM9 and 197s Third Quarter 13 % 11 % .34 Second Quarter 13 % 12 % .34 First Quarter 13 % 11 % .34 197s Fourth Quarter 13 % 11 % .31 Third Quarter 14 % 12 % .31 Second Quarter . 13 % 12 % .31 First Quarter 14 % 13 % .31
'Ibe Common Stock of the Company is listed on the New York, Midwest and Pacine Stock Exchanges.
16
Management's Discussion The following discussion and analysis of the Company's operations sets forth and Analysis of the the factors the Company believes to be reasonable causes for the changes in Summary of Operations 'cVenue and expense items for the three most recent periods presented on the accompanying summary of operations. Operstlag Revenue The Company derived 89% of its operating revenue from sales of electricity for the year ended December 31,1979, and 90% and 91% for the years ended December 31,1978 and 1977, respectively. He balance of operating revenue was derived from sales of steam and gas. He changes in operating revenue for the three periods were attributable to the following (in thousands): Years Ended December 31, 1979 1978 1977 General rate increases $ 31,804 $ 14,896 $ 10,566 Fuel included in base rates (39,044) (41,631) 13,666 Fuel adjustment 118,211 115,864 70,508 Sales volume 35,409 41,069 45,281 Net increase $146,380 $130,198 $140,021 Increase over previous period 20 % 22 % 31 % Fuel included in base rates in the table above is that revenue derived from inclusion of a portion of fuel costs in the computation of the base rates. In ; 1978, the Public Utility Commission of Texas (PUCT) ordered the Company { to recover its fuel costs through the fuel adjustment, thereby decreasing revenue from fuel included in base rates and increasing revenue from the fuel adjustment. The sales volume increase in 1979 was due principally to increased industrial use of electricity. The sales volume increases in both 1978 and 1977, when corapared to previous periods, were due to unusually cold winter weather, warmer than normal summer temperatures, and increasing numbers of customers. Operating Expenses Fuel expense for electric generation increased $1,871,000 for 1979, as ' compared to 1978, due to increased prices for fuel oil and natural gas even though generation requirements for the same period were decreased. . Increases in 1 el exnense for the years ended 1978 and 1977 of $59,665,000 and $74,043,000, respectively, when compared to previous periods, were primarily due to increased prices for fuel oil and natural gas, increased generation requirements, and changes in fuel mix. An increase in purchased power expense of $106,381,000 for 1979, as compared to 1978, was principally caused by a combination of load growth, [ increased preventive maintenance on generating units, forced outages, and economies gained from purchasmg power rather than generating power. Increases in purchased power of $23,570,000 and $22,450,000 for the years 1978 and 1977, respectively, when compared to previous periods, were principally caused by a combination of forced outages, increased peak loads caused by the extreme weather, and downtime of certain units due to conversion for heavy fuel oil burning capability. Other operations expense increases of $21,552,000, $14,123,000, and
$10,182,000 for the years ended 1979,1978, and 1977, respectively, when compared to the previous periods, were due to increases in payroll charged to operations (due pnncipally to contract wage escalations and additional employees) and gas purch==d for resale (primarily caused by increased
- Prices).
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~ '"Maintamasce expense increased $10,540,000 for the year 1979, over the h .. year 1978, due to mainh==ca performed to restore to service units suffering
? . ~ ~ ' breakdowns and extensive preventive maintmance of units to improve the av=Hahikey of those units. Increased maintenance expense of $8,418,000 for
? the year 1978,'over the year 1977, and $9,997,000 for 1977, over 1976, 5 -
;,was due primarily to increased -int-ngof.generstag equipment L .
. --_- necessitate.d.by forced outages. ._ . _ _ ~ . . , ..
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e ~ ? ' ' ~ Increased depreciation expense of $2,691,000 and $6,165,000 for the I ; years ended 1978 and 1977, ay,Aly, when compared to the previous
~~
periods, were principally c===d by additions to plant. Depreciation expense in 1979 re==inad relatively the same as in 1978. In 1979, the Company
, used a 3.76% composite electric depreciation rate, which rate was allowed by the PUCT (see Note I to Financial Statements). His rate was lower than the 3.86% composite electric depreciation rate used in 1978. He effect of the lower rate was offset by more plant in service.
Taxes A decrease in taxes between 1979 and 1978 was due principally to a change in the Federalincome tax rate. The increase in taxes for the year 1978, over 1977, was attributable to an increase in pre-tax income. The increase in taxes in 1977, over the previous year, was principally attnbutable to an merease in pre-tax income and higher payroll an'd property
- axes.
OtherIncome Other income is.moxd in 1979 primarily due to the increase in the allowance ! for equity funds used d' iring construction. This increase resulted from j
^
higher levels of construction work in progress and a change in the rate applied l to compute the allowance for funds used during construction (see Note 1 to Financial Statements). He changes in other income for the years 1978 and l t 1977 were primarily due to the gain on the sales of certain equipment and a portion of the Company's uranium concentrates and a loss on abandonment ; of certain property under construction which occurred in 1977. Interest CharEes Interest charges on long-term debt increased $9,299,000 for the year 1979, ; over 1978, primarily due to the issuances of additional securities. An increase in the amount and cost of short-term debt and certain trusts were the causes for the increase in other interest charges for 1979, over 1978. The g increase in the allowance for borrowed funds used during construction resulted i F from higher levels of castruction work in progress, a change in the rate L applied to compute the allowance for funds used during construction, and the u inclusion of interest expense incurred by certain trusts as part of the borrowed ;
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o tends component of alkmance for funds used during constructice. An increase . t ible debentures in Septa =har, 1977 an , l U. r- .n . .. n.
.Y ' ,'~ principallyi to the issuance of convertincrease. in short term f w - .,J for theyear 1977 increased, when compared to.the prior pedad, due to p _ . i e. . 'the issuance of additional securhina. , N cd
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7 Statement ofIncome c resnelas R = === 7" Bectnc . . . . . . . .n. . . . . . ... . _. $. 79,415 $ 645,899 E per meyeessendes -48,278 50,513 9 Decameser n.19fp end 19Fs 7 ? ' Steaan . . S. . . . m. . . . . .n,.... . 26,645 21,546 di per , _ , g13M[*83 3 8 f 7 f y o -...;;o..._ ~ 864,338 717,958
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'... 160,882 54,501 92,631 71,079 Other operations h
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I Taxes (Note 6) Income I (7,163) 3,974 Current . 24,309 Deferred -net 16,911 28,446 17,900 Investment tax credits-net 29,240 26,468 l Other 749,028 613,523 n 115,310 104,435 OperstlagInconne ~^ - - e Other Income and Dade*'ons i l Allowance for equity funds used during 27,260 15,710 L construction
+ I Other - net 1,805 (290) 144,375 119,855 Income Before Interest Charges Interest Charges (Note 1) 68,784 59,485 Long-term debt 17,539 7,010 Other Allowance for borrowed funds used during construction (26,129) (I6,786) 60,194 49,709 84,181 70,146 Net Inconne (Note 11) 15,622 10,990 Dividends on Preferred Stock
$ 68,559 $ 59,156 Inconne Applicable to Comunom Stock i ,
Average Shares of Common Stock Outstanding 39,310 34,265 r
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~ Based o_n average shares --H--- '% . ' .'. . * ~ r $1.74 : -
- y. Assuming conversion of convertible debentures . c. . . . 1.65 1.62 g-' - ,
. Dividends per Share of (%=- Stock . . . 1.36 1.24
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i The accompanying notes are un integral part of the Gnancial sta**= wats. u n I.r W
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1979 1978 Provided Frous Operations Sources of Funds Invested $ 84,181 $ 70,146 Net income In Utility and Other Plant Prmeipal income items not requiring current For abe years ended funds Deceanber 31,1979 and 1978 62,887 62,573 Depreciation cm ebessende) 16,911 24,309 Deferred income mes-net 28,446 17,900 Investment tax credits-net . Equity component of allowance for funds used during construction (27,260) (15,710) ! Total provided from operations 165,165 159,218 Dividends Preferred dividends (15,622) (10,990) , Common dividends (53,846) _(42,478) ! Reinvested funds provided from 95,697 105,750 operations Frovided From Fhanacing , Sales of securities 50,103 69,789 I Common stock Preferred stock not subject to mandatory redemption 35,000 - Preferred stock subject to mandatory redemption 35,000 - Fi st mortgage bonds (principal amount) 150,000 - 8,162 56,331 l Net change in short-term borrowings Reduction of long-term debt (11,992) (12,377) 9,784 51,277 Equipment purchase obligations 276,057 165,020 ! Total provided from financing t Other Sources and Uses Provided from sales of nuclear fuel (including capitali7ed interest) and other 10,818 56,682 property Temporary cash investments 33,000 (33,000) Other - net (principally changes in working (25,419) 3,761 capital) Total provided from other sources 18,399 27,443 and uses ' 390,153 298,213
*- Expenditures for Utility and Other Flaat Equity component of allowance for funds used during construction 27,260 15,710 g., ,
Invested la UtEty and Olhar Heat . . . , , ... ? $ 417,413 $ 313,923
- 97 5'_ ,
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m _ r I m _- .- m ano 197s Balance at be8i nning of year $ 226,038 $ 209,360 l Stateinent of Retained l Earnings Add (Dedact) 70,146 Net income . 84,181 i For she years essea (15,622) (10,990) Decommer 31.1979 and 197s Dividends on praderred stock . . ..... (53,846) (42,478) r K: ,
-.$a Ihemmem44 _ Dividends on cornienn stock .. ...
8 226,038 [' . MM p 3 u. v'. ty .- % .* 9.,;. 7 % ?.
- Balance at end of year (Nota 2) .
, C n 7_ 2. . .,
~$ 248,751 l l
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l 1979 197s i Balance Sheet Amets neceank.c 31 1979 and 197s Utility and Other Plant, at original cost g, -j Plant in service . . . . ... $1,898,363 $1,673,830 Less: Accumulated provision for depreciation . 607,428 548,304 1,290,935 1,125,526 Construction work in progress 812,227 652,524 l_ Nuclear fuel (Note 9) . 97,847 67,895 2,201,009 1,845,945 Other Property and Investments Subsidiary company (Note 1) 22,327 19,290 Other . . . . 1,936 2,067 24,263 21,357 Current Assets Cash (Note 8) . 3,748 12,505 Temporary cash investments - 33,000 Receivables Customers 75,951 58,296 Other ........ 3,134 3,090 ! Refundable Federal income taxes 24,867 4,064 Materials and supplies, at average cost 10,452 7,523 Fuel stock, at average cost 48,351 31,371 Prepayments and other 7,599 3,360 174,102 153,209 Deferred Charges Unamartized debt expense . . . 3,900 2,685 Unamortized project cancellation costs (Note 7) 25,027 25,332 Other 11,044 10,897 39,971 38,914 s2,439,345 $2,059,425 Capitalization and IJabilities Capitalization (See Statement of Capitalization) Common shareholders' equity $ 663,625 $ 593,703 Preferred stock Not subject to mandatory redemption 136,444 117,936 Subject to mandatory redemption 75,553 30,534 Ieng-term debt 991,385 846,563 1,867,007 1,588,736 Current Liabilities a Ieng-term debt due within one year . . 13,340 10,243 i Notes payable (Note 8) Master notes . . . - 18,333 Commercial paper ... 94,757 68,262 Accounts payable Trade . ... . .. 100,340 61,357 Subsuhary . . .. 2,509 7,547 Taxes accrued . . . . .. . 14,752 7,141 i l Interest accrued 18,020 15,375 i Other . . . .. .. .. 15,735 15,937 i 259,453 204.195 l Deferred Credits
< Investment tax credits . . .. 99,226 69,423 1 ..; . :
Accumulated deferred income taxes . . 143,883 126,389 ;
, Other ... .. .... . .... . ..... 4,619 14,000 l
247,728 209,812 l { neceed. from Sale of Nuclear Fuel (Note 9) 65,157 56,682 i s2,439,345 s2,059,425 De wying notes are an integral part of the Snancial matements. t l b-yw l r l [ 21
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l -: . ~ . -" . l' a KHQ.n:. .- .. nm - a me n n Statement of ~ ~ ' ~ ' 'T" r --= Sheeholded Egsety I i CY talization g2 ands) stock, without per value S 398,121 $ 348,018 h Deconsbur 31.1M and Ms ' Frendum and expense on Capital i i
"" .eenck ..... 2............ . . (1.094) 350 ,
~ Other paid-in cephal . . . . . . . . . . . 25,947 19,297 :
[- uneminat eensimp . . . . . . . . . . . . 240,7s1 226,038 463435_. 36 593,703 38 T.'
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!- "~ Preferred Stoek (Notes'2 and 3) ~ n" 5. I
$100 pervalue . . .
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nevesses Shares Bassmgees asks osammmans thans j [ i Not subject to mandatary redemption 1
$4.40 51,173 3108.00 5,117 7,328 ,
4.50 . . . 5,830 105.00 553 2,618 i 4.40 1949 1,655 103.00 166 481 i 4.20 9,745 102.818 F15 2,921 l 4.44 14,804 103.75 1,400 1,948 i 5.00 10,993 104.25 1,099 3,022 5.08 26,845 104.63 2,685 4,806 ; c .4.52 . . . . 10,564 103.57 1,056 2,859 l
- 6.08 . . . 32,829 103.34 3,283 6,923 i 7.56 350,000 106.80 35,000 35,000 l 8.52 500,000 109.95 50,000 50,000 9.96 350,000 111.60 35,000 _ _
j 136,444 7 117,936 7 I Subject to mandatory redemption 8.80 371,835 107.00 37,183 28,243 I 9.75 33,697 107.00 3,370 2,291 j 8.64 350,000 108.64 35,000 - i 75,553 7 - 30,534 2 Long-Term Debt (Note 4) First mortgage bonds l Maturing 1980 through 1984 , 2% % due June 1,1980 . . . . . - 13,000 1 3%% due November 1,1981 10,000 10,000 ! 3%% due December 1,1982 10,000 10,000 3%% due December 1,1983 10,000 10,000 Maturing 1985 through 1994-4% to 5%% . ...... . 112,000 112,000 Maturing 1995 through 2004-5 % to 8% % . . . . . . . . . . . . . 375,000 ,; _ . 375,000 Maturing 2005 throudi 2009- ' 8% % to 12.3% . . . . . . . . 310,000 160,000 Pollution control and industrial development bonds-due 2006 and 2007 -5.9% to 7% . . . . . 48,000 48,000 Debentures -due 1981 -4% % . 7,875 8,250 Convertible debentures-due 1992
- 7% % . . 48,381 49,998 Equipment purchase obligations 61,061 51,277 992,317 847,525 Unamortized pmnium and discount on debt-net . . . ..... ... (932) (962) ? -
991,ses 73 846,563 53
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m m?~. w ~~ r -~ ; - m--~:---m- -. - Notes to Enancial -a a n -h.,
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, ~. Statements .= -
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- k. - - L- 2=====ry of Signiscaud - System of Accosants. -De --dag records of the Company are maintained in
-[ . m7mwmm C f TAcc . . % Fe5cies ".h wie M Uh S. ystem of h.ts a >Wy ec Federal p y-ng . - -
-~
7 Boergy Regulatory Com====lan (PERC) and adopted by the Innunna Pubbc Semce @nminalanJN) and ee PabhepNtypunnuanian of a _$:v-$$M.g. [. -Q.g _. Texm (PUCT)i- " ~ ~ - " ' " ' ' ~ ~ ' ' ' ~
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s . p#W @ . ( n. Certam amounts included in the t'nannal =tatements for 1978 have been
~
. A reclassdied to conform with the IG presentation with no effect on net income. .
p- ._ _
" " Utility and Other Plant. UQity and other plant is stated at original cost when :
F first dedicated to public service and the amounts shown do not represent repro-f duction costs or current values. Costs of repairs and minor replacements are j charged to expense as incurred. The original cost of depreciable utility plant F retired and cost of removal, less salvage, are charged to accumulated provision L for depreciation. The composite depreciation rates for the year ended l December 31,1979, were equivalent to: electric 3.76%, steam 2.79%, and gas l L,, 3.49%. Dunng the fourth quarter, the Company changed its composite electric L s. . . . . _i, _ depreciation rate effective to January 1,1979, to conform with the rate allowed I'~' by the PUCT. He effect of the change was to increase net income by (~ approxima'ely $1,925,000 ($.05 per share). The provision for depreciation is l
. computed using the straight-line method at rates which will amortize the unrecovered cost of depreciable plant over the estimated remaining service life.
Allowance for Funds Used During Construction and Capitalization of Interest. Allowance for funds used during construction (AFUDC) is a non-cash item which is calculated under guidelines prescribed by the FERC and is capitalized j
- as part of the cost of utility plant representing the cost of servicing the capital invested in construction work in progress. The rate used in computing AFUDC was a 7.6% compound rate (net) effective July 1,1979. Prior to that date, the rate (net) used was 7.5%. Also see Note 1I regarding a change in 1979 of i the AFUDC rate. Such AFUDC has been segregated into two component parts -
borrowed funds and equity funds. That portion allocated to borrowed funds is y reflected as an adjustment of interest charges. Interest incurred by certam trusts r/? >
~ ' ~
< +
(see Notes 4 and 9) is included in interest expense in the statement of income F'
#M n with a cuim.yceding amount included as part of the borrowed funds maaaaid ' ' ~
.a of AFUDC. -
e . . . - _ . . ,,,~.,.<y g ,, mm e,.d.42f r;;... r e m ;;7. w.n p n n.a ~
~ Revenue amiFnel. The Company records revenue as biBed to its customers on WE & ~ ~ ' -
a cycle billing basis. Revenue is not recorded for energy delivered and unbilled {.p - at the end of each fiscal period. The costs of fuel and of gas distn'buted are charged to expense as used. Rate schedules of the Company provute for p:~ , adjnetments to suhatantiaHy all rates for increases or decreases in the costs of fuel for generation and of gas distributed. ~ Income Taxes. The Company follows a policy of comprehensive inter-period income tax allocation where such treatmet t is permitted for rate-making
- k. >
purposes by regulatory bodies. Deferred Federalincome taxes, which result L .w. from timing differences in the recognition of revenue and expenses for tax and annncini armenned purpoets, are charEed to income and concurrently credited to
- h. p ;A{N.
s y:C t , accumulated deferred income taxes. g +- , .m '4 - 2 The Cosapany defers investment tax credits and amortizes the accumulated
~ ~ halance over the usefullives of the gegdy which gave rise to such credits.
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E-Note 1. (e-el-ad) At December 31,1979, there was an investment tax credit carryforward generated in 1979 of approximately $12,200,000 which expires in 1986. The Company also claims investment tax credits under the provisions of the Tax Reduction Act Stock Ownership Plan (TRASOP). Subsidiary Coenpany. The Company has made investments in and advances to Varibus Corporation and accounts for its investments on the equity basis.
;
Employee Benefus. The Company has a contributory pension plan covering all l employees meeting certain age and service requirements. The accrued cost of this plan is being funded. Past service costs are being funded and amortized by the Company over a thirty-year period. Under the provisions of the TRASOP, contributions may be made by the Company to the trustee either in cash or the Company's common stock in amounts up to an additional 1% % of the Company's qualified investments as provided by the Internal Revenue Code. Earnings Per Share. Earnings per share are based on the weighted average , number of common shares outstanding during the period. Earnings per share, l assuming conversion of convertible debentures, are based on the weighted l average number of common shares outstandmg plus the shares which would l have been issued if the outstandmg convertible debentures had been converted i on the date of issue, after giving effect to the elimination of related interest l expense and amortization of bond discount and expense of issue (net of related income taxes). The number of shares for the latter computation was approxi-mately 42,599,000 and 37,632,000 for 1979 and 1978, respectively.
- 2. Capital Stock and At December 31,1979,100,000,000 shares of common stock, without par Retained Earaings value, were authorized, with 42,721,874 and 38,302,420 shares outstandmg at i December 31,1979 and 1978, respectively. The changes in common stock, j resulting from public offerings, shares issued to the Employees Drift Plan (Thrift), Automatic Dividend Reinvestment and Stock Purchase Plan (DRIP), l I
TRASOP, and conversion of convertible debentures, were as follows: 1979 197:
' Numaber of A====e Om Number of Aamenet Ga m anus "$
m ares shoesands)
. Public offering 3,500,000 $38,546 5,000,000 $63,200 2,310 147,145 1,945 Drift . . . . . . .. . 185,493 l f' . ,
326,206 4,003 187,537 2,420 l - DRIP . . .
- - TRASOP . 298,869 3,654 172,052 2,222 Conversion of debentures . 108,886 1,590 134 2 4,419,454 $50,103 5,506,868 $69,789 At December 31,1979, the Company had reserved approximately 1,034,000 shares of common stock to be issued in connection with the nnft,
, DRIP, and TRASOP.
During 1979, the C==ny lassed 350,000 shares of $996 Dividend
~
1 7 Preferred Stock not subject to mandatary redemption. De Company's pre-
, , - = ~ g ferred stock not subject to mandatary iQ is red **mahle at the option of the Company upon payment of the redemption price together with accrued u dividends. At December 31,1979, the Company had authorned 6,000,000 c.
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=
Note 2. (e--d===d) shares of preferred stock, $100 par value, cumulative, and 10,000,000 shares of authorized and unissued preferred stock without par value. Certain limitations on the payment of cash dividends on common stock are contamed in the Company's Ret.tated Articles of Incorporation and indentures. He most restrictive limitation is contained in the Trust Indenture, dated as of September 1,1977. He amounts which may be paid after December 31,1976, are limited to the su.n of $100,000,000 plus (or minus in the case of a deficit) : the aggregate amount of net income available for dividends, as defined, accumulated after December 31,1976. The retained earmngs available for paymet.' of dividends as of December 31,1979 and 1978, amounted to l i
$157,251,000 and $131,490,000, respectively. See Note 3 for restrictions on i
common dividends under the unhng fund provisions for preferred stock.
- 3. Preferred Stock Sebject The Company consummated, in January,1979, an exchange of certain series of
;
to Mandatory Redeanytion its preferred stock not subject to mandatory redemption for shares of its $8.80 and $9.75 Dividend series of Preferred Stock subject to mandatory redemption. As a result of such exchange, approximately $25,847,000 (consisting of
$6,550,000 and $19,297,000 for 1979 and 1978, respectively) of paid-in ,
capital was r==nbad due to the difference in the aggregate par value and l exchange ratios of the series exchanged. There were no other changes in paid-in capital for either of the years. In August,1979, the Company sold 350,000 shares of $8.64 Dividend Preferred Stock and,in January, 1980,500,000 shares of $11.48 Dividend Preferred Stock. The $8.80 and $9.75 Dividend series are entitled to mandatory sinking funds sufficient to retire 3% of the shares of each series belnnnmg in 1984, and the $8.64 and $11.48 Dividend series are entitled to mandatory sinking funds sufficient to retire 4% of such series begmnmg in 1985 and 1986, respectively. . The aggregate sinking fund requirement in 1984 is $1,217,000. Preferred stock { sinking fund provisions restrict the payment of common stock dividends and the j purchase of such stock by the Company unless the sinking fund requirements are met.
- 4. Long-Term Debt The Company's Mortgage contains sinking fund provisions which require, generally, that the Company make annual cash deposits equal to 1.2% of the ,
greatest aggregate principal amount of first mortgage bonds subsequently j authenticated and delivered or,in lieu thereof, to apply property additions or i reacquired first mortgage bonds for that purpose. De Company has satisfied the ! mortgage requirements in past years by certifying "available net additions" to l the trustee. j Sinking fmx! requirements on the first mortgage bonds for each of the five years subsequent to December 31,1979, are as follows: 1980- $10,080,000; 1981 - $9,924,000; 1982 - $9,804,000; 1983 - $9,684,000; and 1984 - $9,564,000. The Trust Indenture for the 4% % Debentures requires annual redemption for sinking fund purposes of $375,000 principal amount through 1980. The 7% % Convertible Debentures may be converted into the Company's na==an stock at a price of $14.85 per share. The closing market price of the Company's common stock at Dace =har 31,1979, was $11.00. Dering 1978, the Company entered into two agreements #c 4 the Company assigned its right to p case turbine generators to certam Trusts. De s,w;. providei that the Trusts would make required payments to the turbine generators' manufacturers and the Company would purchase such gener-ators from the Trusts for an amount equal to the payments made plus certain i i b l e - f 25 e
. . s_.m - ..v _. = -.
~ .
~ Neeef(condamed) lifrying coats,8aa'ad == interest. Information regarding the Trusts is as follows (in'han===da of dollars):
apre Geesem 'Iw Gem
~ ~ Maturity dote (on or before) .. . 1-2-81 6-30-82 Obligation . ..... ..... .. ....... 339,565 $21,496 l
; Interest ocet . . . . . . . . . . . . . ........ 3,505 2,621 f
Average inserest race (a) . . . . . . . . . . . . 9.44 % 14.06 % < 1ers r Obhgation . . . . . . . . . . . . . . . . . . . $35,707 $15,570 Interen oost ...... ....... .... .. 2,595 199 Average interest rate (s) . . 9.06 % 11.89 % (a) varies with the prime interest rate with the exception of the Srst $37,500,000 on the Gideon Trust which bears interest at 9% %. At Deccanber 31,1979, the Counpany had received approval to effect two i
;
amendments to its Mortgage. One ==aad= ant increased the aggregate limit on bonds outa=*a: from $1,000,000,000 to $100,000,000,000. The other ; amendment skered the deAnition of " minimum provision for depreciation" in the
;
' worig.ge.
k
- 5. Fanployeen, ae Plans At December 31,1978, the actuarially computed unfimdad past service cost of i
the Company's pension plan was approximately $18,014,000 and actuanally I computed vested bene 6ts ec adad plan assets by approximately $7,065,000. The cw'-:= actuary's valuation report as of December 31,1979, has not yet ,
~
been c--A-2 ' 'Ibe costs of the plan charged to income were $3,228,000 and $2,211,000, and charges to construction and other accounts were
$1,604,000 and $983,000 for the years 1979 and 1978, iWw.:y.
For the years 1979 and 1978, the Company generated inve=t=aat tax credits under the TRASOP of approximately $5,300,000 and $2,700,000, respectively. The Company accrued a liability for the 1978 contribution. l
'._ 'IRASOP amounts generated in 1979 will be carned forward for utihrmtion in
- p. future years.
.p e ._ '
t 6. FederalIncomeTaxes "Ihe provisions for Federal income tax were less than the amount obtainad by
-% .,. .- . . - using the statutory rate -prismarily due to the following: 7;, 1
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Note 6. (coatinued) Deferred Federal income tax expense results from timing differences in the recognition of revenue and expense for tax and financial statement purposes. The sources of these differences and the tax effect of each were as follows (in thousands): 1979 197s Excess of accelerated tax depreciation over straight-line tax depreciation $ 8,732 $ 8,454 Cancellation costs of proposed nuclear units expensed for tax purposes in 1978, to be amortized for books (136) 10,676 Excess of accelerated amortization of pollution control facilities over ! straight-line tax depreciation 2,377 2,549 l Items expensed for tax purposes, but I capitahzed as depreciable plant for l books 5,762 2,677 ; Amortization of loss on pollution con-trol bond refundmg for book purposes only . (47) (47) ;
$16,688 $24,309 l l
- 7. CanceDed Nuclear Units In August,1978, the Company cancelled construction of two planned nuclear !
units at the Blue Hills site in East Texas. The site will be retamed as a ! location for potential generating facilities. The cancellation costs of these units l aggregated approximately $25,332,000 before considering the related tax effect of $10,676,000. } On December 28,1979, the FERC authodzed the Company to commence amortizing such costs, net of income taxes, over a five-year period beinnmng no later than January 1,1980. The FERC had previously authorized such amortization to begin in January,1979 (see Note 11). The PUCT has allowed the Company to begin recovery of such costs through rates over five , yean. The Company has requested the same rate-makmg treatment of these ! costs from the LPSC. ,
- 8. Short-Term Borrowings On December 31,1979, the Company had agreements with numerous banks F
providmg for borrowings up to $121,340,000 at the prime ca===cial landing rate in effect from time to time without payment of a commitament foe. In addition, the Company had agreements with several banks providmg for
; borrowings up to $36,000,000 at 115% of the prime ca===tial lendmg rate ; ;. in cifect from time to time with payment of an annual fee of 5% of prune !
f lendmg rate on the enemitment. The Company maintains non-segregated : working cash balances which generally average, over the life of the agreements,
- apprormatdy 10% of the commitment. ,
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P b Note 8. (contimmed) Information regarding short-term debt outstanding is as follows (in thousands of dollars): 1979 197s l Maximum amoitat outstandmg at any i one time $141,366 $128,971 Average daily outstandmg .. 79,186 84,110 Weighted average interest rate for amount outstandmg at year-end 14.06 % 10.27 % Weighted average annualinterest i rate (a) . . 11.33 % 7.95 % (a) calculated by dividios the sum of the effective interest for the year by the average daily short-term debt outstanding ; I
- 9. Commitments and On December 29,1978, the Company entered into an agreement with a trust, i Contingencies whereby the Company sold it a portion of its uranium inventory for approxi- l mately $55,836,000 (the Company's book value). The Company has retained !
certain options to repurchase the uranium inventory for an amount equal to j the trust's cost plus interest and other costs incurred to the date the options are : exercised. The balance sheet at December 31,1979 and 1978, included l
$65,157,000 and $56,682,000, respectively, recorded in " Utility and Other (
Plant, at original cost - Nuclear fuel" and " Proceeds from Sale of Nuclear l Fuel". Interest costs in 1979 and 1978 were $8,320,000 and $60,000, ; respectively. j l Various state and Federal laws require governmental permits prior to i construction and operation of certain facilities. Substantial expenditures and ! commitments are made prior to obtaining such permits. Unless and until l events occur making such permits unobtainable, no provision is made in the j financial statements for possible losses which could occur if such permits i should not be obtained. He 1980 construction program is estimated to be !
$400,000,000, including approximately $70,000,000 of AFUDC. In connec- !
tion with the construction program, the Company has incurred substantial ; commitments. Here are sundry claims pendmg against the Company, all of which ; are incidental to the ordinary course of business and in the opinion of Company 4 management should not result in =igawaat liability.
- Q ja .. ;
- 10. ~ _,,5-- " Earnings Supplemental earnings per share for the year ended Danamhar 31,1979, Per Share Data calculated assuming that any shares of common stock issued during the year i (see Note 2) had been outstanding during the entire year ended nan.mher 31, 1979, and assuming (1) that the proceeds of such innamacan had been l used to reduce average short-term indebtedness outstandmg dunng the year, ,
l ! and (2) that the Company's actual financing program for 1979 had not been otherwise altered due to the issuances and sale of such common stock, the earnings per average share for the year ended December 31,1979, would have been $1.66, based on a calculated average of approximately 42,722,000
- comunon shares. Assuming conversion of the convertible debentures as of January 1,1979, such earnings per average share would have been $1.58, r based on a calcalatad average of approximately 45,980,000 common shares.
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- 11. Quarterly F1===rl=I i
. Infonmation (Unnented) sensd os ca7. M Average or .
Om tomammes ===ye Not h Convertible per abarr sammunes) Oprating Operating l mevemme 3- Incomme Oswa= mar Debestures 1M9 Fourth Quarter $216,%9 $31,912 $25,835 $.52 $.49 l Third Quarter 250,891 41,945 31,930 .72 .67 l Second Quarter 211,185 22,355 13,037 .24 .23 l First Quarter 185,297 19,098 13,379 .26 .25 ! i 1Ms Fourth Quarter . 166,427 27,910 18,481 .41 .39 i
*Ibird Quarter . 219,962 35,919 25,511 .69 .64 l Second Quarter 171,435 20,797 14,461 .36 .34 ,
First Quarter 160,134 19,809 11,693 .27 .26 !- Dunng the fourth quarter of 1979, the Company changed its AFUDC [' rate effective to July 1,1979 (see Note 1). The effect of this change was to increase net income by approximately $2,699,000 ($.07 per share). As a result l of the FERC amending its original order (see Note 7), the amortization of ; the nuclear units cancellation costs charged to operations through October,1979, and a portion in November,1979, was reversed in December,1979, thereby increasmg net income by appronmrtely $2,600,000 ($.07 per share). See , Note 1 for the change in the electric depreciation rate. Previously reported l quarterly financial information was not restated. i 12. SuppleasentalInfonnation Tbc following supplementary information is supplied in accordance with the ; on Changing Prices requirements of the Statement of Financial Accounting Standards No. 33 for ; j (Umandited) the purpose of providing certain information about the effects of chaneng prices. ; It should be viewed as an estunate of the approximate effect of inflation, rather than as a prectse measure. J Statement ofIncome i Adjusted for Changing Prices % ,.
% g l For the year ended December 31,1979 Himaarical A A l cost 1M9 1979
.f gn assummes)
.........................$ 864,3 3 8
~
$ 864,338 ._864,338 l
jf operating revenue Fuel . .. .. ............................... . 318,494 318,494 318,494 : FE ; 160,8827= f16Q,882.1 160,882 Purchased power . f."i7.EF.h DRM.g. . :. . . . . ! kW Olber operations and = alan === man '.V. .MJWA'... .r.C'139,3317' (139,331.? J ' '.139,331 i Depreciation expense '62,887 125,457 ~ 141,571 - f . . . . ...... ..
.......;..u..
67,434 67,434 67,434 1 Taxes ..... ... . ........... . . . i- Other income and deductions-not . ................. (29,065) (29,065) (29,065) 60,194 _ 60,194 60,194 i f Y Interest charges . ..... ... ....................
- 780,157 842,727 858,841 Net Income (excluding reduction to net recoverable cost) $ 84,181 $ 21,611* $ 5,497 Increase in specific prices (current cost) of utility and other plant held during the year ** . . .............. ..... $ 253,328
, {. $(187,208) (41,157) ! / Reduction to net recoverable cost . . . . ......... . (383,265)
.% f&
E8ect of increase in general price level . . m. :. r. . es.'. . . Bacess of increase in general price level'EveIlmcrosselliIaL :. l .W=c .. ~~
, NM. --
-' - O N = ~7=
(171,094) F~~ speciSc pdces after reduction to net recoverable cost..1 . 158,653 . 158,653 I p Gais froan dochne in purchasing power of act announts owed .% , (, ' ~ 3;
$ (28,555) $ (12,441)
Not .. . . . . . . . . . . . . . . . . . . . .'. C .W.y.y.; . : 1. . .[1 f t, .
- Including the reduction to set recoverable cost, to loss on a oomstaat dotar basis would have besa $165,597 for 1979.
At Deceanber 31,1979, current cost of stuity and oIber amt. not of accumulated depreciataan, was $3,368,461, while lustorncal
.[.f cost or met cost recoverable troush wes_,, , _ ,tM; _
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P Mye Year Camparison of Selected E_..'-- , Man =ri=1 Data Adjusted for Efects of Changing Prices Gm thememado of average 1979 doners) Years R= dad Deceanber 31, 1F19 1978 1977 1976 1975 Operadas revemme .. $864,338 $798,793 $704,017 $570,900 $488,522 , IEsterical cost leforumados adjusted for sumeral h Net mcome (excluding reduction to net recover-able cost) . . 21,611 ( Net income per common share (after dividend requirements on preferred stock) .15 ( Net assets at year-end at net recoverable cost . 736,095 Current Cost Inforunation L Net income (excluding reduction to net recover- I able cost) 5,497 Loss per common share (after dividend require-ments on preferres tock and excluding reduction to net recoverable cosC (.26) , Excess of increase in general price level over merease in specific prices after reduction to net recoverable cost (171,094) , Net assets at year-end at net recoverable cost . 736,095 l I GeneralInforunation Gain from decline in purchasmg power of net amounts owed 158,653 Cash dividends declared per common share $ 1.36 $ 1.38 $ 1.38 $ 1.43 $ 1.51 Market price per common share at year-end 10.41 12.59 16.94 17.31 15.36 I Average consumer price index 217.4* 195.4 181.5 170.5 161.2 l l i
- Estunated average consumer price index for 1979 ;
I Constant dollar amo mts represent historical costs stated in terms of dollars of equal purchasing power, as measured by the Consumers Price Index ; for all Urban Consumers. Current cost amounts reflect the changes in specific ,
;
prices of plant from the date the plant was acquired to the present, and differ from constant dollar amounts to the extent that specific prices have increased i more or less rapidly than prices in general. , l ne current cost of utility and other plant, which includes land, land : rights, nuclear fuel, plant held for future use, and construction work in progress, represents the estimated cost of replacing existing plant assets and was deter-mined by iMag surviving plant by the Handy-Whitman Index of Public Utility Construction Costs. He current year's provision for depreciation on the constant dollar and current cost amounts of utility epd other plant was determined by applying the Company's depreciation rates to the indexed plant amounts. Fuelinventories, the cost of fuel used in generation, and gas purchased for resale have not been restated from their historical cost in nominal dollars. l Regulation limits the recovery of fuel and purchased costs through the opera-tion of adjustment clauses or adjustments in basic rate schedules to actual i costa. For this reason fuelinventories are effectively monetary assets. l l l
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- Note 12. (ea=d===a) ' ~As'preeczibed in statement No. 33, income taxes were not adjusted.
... Under the ratesnaking presented by the regulatory commissions to which this Company is subject, only the historical cost of plant is recoverable in
. , revenues as ? . !=^=-1 'Iberdore the excess of the cost of plant stated , ,
~ 7 leiteiiiins'of onestant doBars or current cost, over the historical cost of plant, ils not presseth recoverstic in rates as depr=4=Han, and is rudected as a
-138dECODRID nSt,aBDOggsdie cost {p;the ratHasking process gives no
- ' secognition to the curstat cost of. replacing utElty and other plant, based on past practices, the Company beheves it_wlR be aBowed to earn on the increased cost Netles notinv==h===' when replar===ent of fadlities actuaDy occurs.
7ToleSect propedy the acnanEin t rate c regulation in the statement of income adjusted for changing prices, the r~W of net utility and other plant should be oEset by the gain from the dachne in purchasing power of net amounts owed. Dunng a penod of innatina, holders of monetary assets suffer a loss of general purchasing power while holders of monetary habilities experience a gain. 'Ibe gain from the dechne in purchasing power of net amounts owed is primarily attributable to the substantial amount of debt which has been used to Anance utility and other plant. Since the depreciation on this plant is limited to the recovery of historical costs, the Company does not
'have the opportunity to reahme a bokhng gain on debt and is limited to recovery only of the embedded cost of debt capital.
To the Shareholders of Gulf States Utikties Cr---+y. '
~
Auditors' Report ~- We have exammed the balance sheet and statement of capit=hratian of GULF STATES UITLITIES COMPANY as of December 31,1979 and 1978, and the related statements of inecme, retained earnings and sources of funds invested in utility and other plant for the years then ended. Our examinations were made in accordance with generally accepted auditing standards and, a-C ly, included such tests of the accounting records and such other auditing procedures as we considered naces==ry in the ciremn=tances In our opinion, the Anancial statements referred to above present fairly the
.D. Tamandma poslalon af OW.F STA* Ills UTILITIES COMPANY es of nar nher St,~ 1979 and 1978, and iheTee~ hi et hiop' erations' and si==Em etdes smeds
~
invested in utility and other plant for the years then' ended,~in conforunty with f generally, accepted acooanting principles applied on si consistemt basis.
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Statistical Summary I For time See years ended r Dae==har 31, IF19 i 1979 1978 1977 1976 1975 i Electric Department Number of Customers- l End of Year j Residential 423,850 ~ ~ 407,761 391,031 377,302 365,335 Commercial . 50,807 48,892 47,352 45,752 44,281 l 3,455 5,970* ' Industrial .. . 3,386 3,392 3,379 Temporary construction 3,279 4,304 4,389 3,404 - l Other 1,873 1,790 1,690 1,626 1,552 483,195 466,139 447,841 431,539 417,138 ; Electrical Sales- l Thousands of KWH Residential 5,147,436 5,198,421 4,789,630 4,198,447 4,004,403 Commercial 3,759,289 3,738,114 3,486,193 3,170,084 2,949,455 l Industrial 14,961,211 14,447,417 13,216,824 11,886,799 10,530,108* Temporary construction 44,059 42,358 23,017 14,269 - [ Other 2,638,490 2,452,228 2,025,933 1,713,762 1,583,054 ! 26,550,4f6 25,878,538 23,541,597 20,983,361 19,067,020 l Steam 3,191,464 3,012,993 2,995,619 2,818,637 2,514,086 , 29,741,949 28,891,531 26,537,216 23,801,998 21,581,106 l i Average Annual KWH Use j Per Customer l Residential 12,374 13,009 12,480 11,303 11,096 ! Commercial 75,291 77,472 74,875 70,370 67,754 Indus. trial 4,402,946 4,221,922 3,858,927 3,477,705 1,879,705* Electric Energy Output-Thousands of KWH Net Generated 25,381,996 28,299,011 26,295,869 24,336,097 21,950,302 Net Purchased and ,_ x Interchanged . . 5,871,615 1,985,508 1,603,807 739,078 884,068 - 31,253,611 30,284,519 27,899,676 25,125,175 22,834,370 l _ y 1*eak Imed, Includmg Inter- .. . .. , _ . , . . _ A
. ruptible Imad-Kilowatts 5,238@88 T.-m,.137,700?%, i5 .
< . 656,800 .14,160,880 .1 ~ 3,977,100 . a_
Contract Purchases at Time of Peak load-Kilowatts 6,169,808 "5,737,000 5,734,000
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5,686,000 5,250,000 , Annual Imad Factor ..... 68.2 % 67.3 % 68.4 % 68.7 % 65.5 % l Steata Depr tment Steam Sales-Millions of Pounds . . .. .. ... 14,796 15,787 16,987 19,346 18,772 Gas Department _ TNumber of Customers-Bad _. 80,116 77,260 74,350 Mai Year ....:........ 83.918 82,391 8,443,243
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i M, issius --MG . . . I: . . . . . . 9,891,331 ~ ",19,207,194i. - 19,865,995 9,781,941 ~ 7,3 f7i , .
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Principal Offices 285 Liberty Avenue Beaumont, Texas 77701 Divisions: 1540 Ninth Avenue Port Arthe , Texas 77640 Highway 75 North Conroe, Texas 77301 446 North Boulevard Baton Rouge Louisiana 70802 314 Broad Street Lake Charles, Louisiana 70601 Stockholder Information m=* uning Gulf States Utilities Company is traded under the symbol GSU on New York, Slidwest, Philadelphia and Pacific stock exchanges. Stock Transfer Agents American National Bank of Beaumont Beaumont, Texas Irving Trust Company New York, New York First National Bank of Chicago Chicago, Illinois Registrars First Security Bank of Beaumont, N.A. Beaumont, Texas Manufacturers Hanover Trust Company New York, New York Northern Trust Company Chicago, Illinois Form 10-K The Form 10-K annual report to tne Secunties and Exchange Commission will be available March 31,1980. Copies of Form 10-K and GSU's 1979 Financial and Statistical Report can be obtained from Leslie D. Ogden, Corporate Secretary, P.O. Box 2951 Beaumont. Texas 777(M. Notice of Annual Sleeting The 1980 annual meeting of shareholders and a special meeting of preferred shareholders will be held at 2 p.m.. Thursday, May 8,1980, in the company headquarters,285 Liberty Avenue, Beaumont, Texas. A formal notice of the meet-ing and proxy will be aailed to both the com-mon and preferred shareholders about April 4, 1980. Shareholders are invited to attend, but if they cannot, they are urged to fill out and return their proxy. se
a'b GULF STATES UTILITIES COMPANY
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