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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For Quarterly Period Ended September 30, 1999
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For The Transition Period From to
Commission file number 1-14756.
AMEREN CORPORATION
(Exact name of registrant as specified in its charter)
Missouri 43-1723446
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1901 Chouteau Avenue, St. Louis, Missouri 63103
(Address of principal executive offices and Zip Code)
Registrant's telephone number,
including area code: (314) 621-3222
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.
Yes X. No .
Shares outstanding of each of registrant's classes of common stock as of October
31, 1999: Common Stock, $ .01 par value - 137,215,462
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Ameren Corporation
Index
Page No.
Part I Consolidated Financial Information (Unaudited)
Management's Discussion and Analysis 2
Quantitative and Qualitative Disclosure
About Market Risk 8
Consolidated Balance Sheet
- September 30, 1999 and December 31, 1998 10
Consolidated Statement of Income
- Three months, nine months and 12 months ended
September 30, 1999 and 1998 11
Consolidated Statement of Cash Flows
- Nine months ended September 30, 1999 and 1998 12
Notes to Consolidated Financial Statements 13
Part II Other Information 16
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PART I. CONSOLIDATED FINANCIAL INFORMATION (UNAUDITED)
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS
OVERVIEW
Ameren Corporation (Ameren or the Registrant) is a holding company registered
under the Public Utility Holding Company Act of 1935 (PUHCA). In December 1997,
Union Electric Company (AmerenUE) and CIPSCO Incorporated (CIPSCO) combined to
form Ameren, with AmerenUE and CIPSCO's subsidiaries, Central Illinois Public
Service Company (AmerenCIPS) and CIPSCO Investment Company (CIC), becoming
wholly-owned subsidiaries of Ameren (the Merger). As a result of the Merger,
Ameren has a 60 percent ownership interest in Electric Energy, Inc. (EEI), which
is consolidated for financial reporting purposes. In 1998, Ameren formed a new
energy marketing subsidiary, AmerenEnergy, Inc., which primarily serves as a
power marketing agent for the operating companies and provides a range of energy
and risk management services to targeted customers.
The Merger was accounted for as a pooling of interests; therefore the
consolidated financial statements are presented as if the Merger were
consummated as of the beginning of the earliest period presented. However, the
consolidated financial statements are not necessarily indicative of the results
of operations, financial position or cash flows that would have occurred had the
Merger been consummated for the periods for which it is given effect, nor is it
necessarily indicative of the future results of operations, financial position
or cash flows.
The following discussion and analysis should be read in conjunction with the
Notes to Consolidated Financial Statements beginning on page 13, and the
Management's Discussion and Analysis of Financial Condition and Results of
Operations (MD&A), the Audited Consolidated Financial Statements and the Notes
to Consolidated Financial Statements appearing in the Registrant's 1998 Annual
Report to stockholders (which is incorporated by reference in the Registrant's
1998 Form 10-K).
References to the Registrant are to Ameren on a consolidated basis; however, in
certain circumstances, the subsidiaries are separately referred to in order to
distinguish between their different business activities.
RESULTS OF OPERATIONS
Earnings
Third quarter 1999 earnings of $250 million, or $1.82 per share, increased $13
million, or 9 cents per share, from 1998's third quarter earnings. Earnings for
the nine months ended September 30, 1999, totaled $391 million, or $2.85 per
share, compared to the year-ago earnings of $360 million or $2.63 per share.
Earnings for the 12 months ended September 30, 1999, were $417 million, or $3.04
per share, compared to $355 million, or $2.59 per share, for the preceding
12-month period. Excluding the extraordinary charge recorded in the fourth
quarter of 1997 to write off the generation-related regulatory assets and
liabilities of the Registrant's Illinois retail electric business, earnings for
the 12-month period ended September 30, 1998, were $407 million, or $2.97 per
share.
Earnings and earnings per share fluctuated due to many conditions, primarily:
weather variations, credits to electric customers, electric rate reductions,
competitive market forces, sales growth, fluctuating operating costs (including
Callaway Nuclear Plant refueling outages), merger-related expenses, changes in
interest expense, changes in income and property taxes, a charge for a targeted
employee separation plan and an extraordinary charge as noted above.
The significant items affecting revenues, costs and earnings during the
three-month, nine-month and 12-month periods ended September 30, 1999 and 1998
are detailed on the following pages.
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Electric Operations
Electric Operating Revenues Variations for periods ended September 30, 1999
from comparable prior-year periods
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(Millions of Dollars) Three Months Nine Months Twelve Months
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Rate variations $ (7) $(24) $(37)
Credit to customers (10) 13 13
Effect of abnormal weather (16) (50) (76)
Growth and other 28 33 30
Interchange sales 87 159 189
EEI (11) 13 (5)
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$ 71 $144 $114
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The $71 million increase in third quarter electric revenues compared to the
year-ago quarter was primarily driven by increased interchange sales due to
strong marketing efforts. Interchange sales increased 44 percent for the third
quarter of 1999 compared to the year-ago quarter. These increases were partially
offset by a 1 percent decline in native sales due to milder weather, rate
decreases in both Missouri and Illinois, and the estimated credit that the
Registrant expects to pay its Illinois electric customers for the initial period
of a sharing mechanism provided by deregulation legislation (see Note 5 under
Notes to Consolidated Financial Statements for further information).
Weather-sensitive residential sales decreased 3 percent, while industrial sales
rose 2 percent, and commercial sales were flat.
Electric revenues for the first nine months of 1999 increased $144 million
compared to the prior-year period, primarily due to a 10 percent increase in
total kilowatthour sales. This increase was primarily driven by a 79 percent
increase in interchange sales due to strong marketing efforts and a 17 percent
increase in EEI sales. Also contributing to the revenue increase was a decrease
in the credit to Missouri electric customers, partially offset by the credit to
Illinois electric customers (see Note 5 under Notes to Consolidated Financial
Statements for further information). Partially offsetting these increases,
weather-sensitive residential and commercial sales were down 3 percent and 2
percent, respectively, and industrial sales declined 1 percent. In addition,
revenues were lower due to rate decreases in both Missouri and Illinois (see
Note 5 under Notes to Consolidated Financial Statements for further
information).
Electric revenues for the 12 months ended September 30, 1999, increased $114
million compared to the prior 12-month period. The increase in revenues was
primarily driven by increased interchange sales due to strong marketing efforts.
Also contributing to the revenue increase was a decrease in the estimated credit
to Missouri electric customers, partially offset by the estimated credit to
Illinois electric customers. These increases were partially offset by rate
decreases in both Missouri and Illinois. (See Note 5 under Notes to Consolidated
Financial Statements for further information.) In addition, revenues decreased
due to a decline in native sales resulting from milder weather.
Weather-sensitive residential and commercial sales decreased 4 percent and 2
percent, respectively, while industrial sales fell 1 percent.
Fuel and Purchased Power Variations for periods ended September 30, 1999
from comparable prior-year periods
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(Millions of Dollars) Three Months Nine Months Twelve Months
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Fuel:
Variation in generation $(8) $11 $27
Price - (22) (47)
Generation efficiencies and other 1 - (2)
Purchased power variation 53 84 63
EEI variation 2 25 19
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$48 $98 $60
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The $48 million increase in third quarter fuel and purchased power costs
compared to the year-ago quarter was driven by increased purchased power,
resulting from higher sales volume, partially offset by decreased generation.
Fuel and purchased power costs for the nine and 12 months ended September 30,
1999, increased $98 million and $60 million, respectively, versus the comparable
prior-year periods primarily due to increased generation and purchased power,
resulting from higher sales volume, and increased fuel and purchased power costs
at EEI, partially offset by lower fuel prices.
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Gas Operations
Gas revenues for the 12-month period ended September 30, 1999, decreased $18
million compared to the same year-ago period primarily due to a 19 percent
decline in total sales resulting primarily from milder winter weather, partially
offset by an Illinois gas rate increase effective February 1999 and a Missouri
gas rate increase effective February 1998.
Gas costs for the 12 months ended September 30, 1999, decreased $22 million
compared to the year-ago period primarily due to lower sales and a decrease in
gas prices.
Other Operating Expenses
Other operating expense variations reflected recurring factors such as growth,
inflation, labor and benefit increases.
Other operations expenses decreased $7 million and $6 million, respectively, for
the three and nine months ended September 30, 1999, compared to the comparable
prior-year periods primarily due to the 1998 one-time pretax charge of $25
million for the targeted employee separation plan and reduced workforce,
partially offset by current year expenses associated with deregulation in
Illinois and the Year 2000 project.
Maintenance expenses for the three, nine and 12 months ended September 30, 1999,
increased $14 million, $28 million and $25 million, respectively, compared to
the year-ago periods primarily due to increased power plant maintenance and
tree-trimming activity. These increases were partially offset by the absence of
a refueling at the Callaway Nuclear Plant until fourth quarter 1999. There was a
Callaway Nuclear Plant refueling in second quarter 1998.
Taxes
Income taxes increased $9 million, $18 million and $37 million, for the three,
nine and 12 months ended September 30, 1999, respectively, due to higher pretax
income.
Other Income and Deductions
The variation in miscellaneous, net for the 12-month period ended September 30,
1999, compared to the year-ago period, was primarily due to an increase in
miscellaneous expense resulting from the reversal of the Missouri portion of
merger-related costs which were recorded as a regulatory asset upon Merger close
in December 1997, under conditions of the Missouri Public Service Commission
order approving the Merger. This increase was partially offset by increased
interest income and gains on the sale of property in the current 12-month
period.
Balance Sheet
The $254 million increase in cash and cash equivalents was primarily due to
higher revenues attributable to interchange sales in August and September 1999
compared to November and December 1998.
The $91 million increase in trade accounts receivable and unbilled revenue was
due primarily to higher revenues in August and September 1999 compared to
November and December 1998.
Changes in accounts and wages payable and taxes accrued resulted from the timing
of various payments to taxing authorities and suppliers.
The $109 million increase in other current liabilities was primarily due to the
timing of when credits will be paid to electric customers in the Registrant's
Missouri and Illinois jurisdictions, as well as an estimated rate reduction for
Missouri electric customers retroactive to September 1, 1998 (See Note 5 under
Notes to Consolidated Financial Statements for further information). The
remaining variance is a result of the timing of various payments to suppliers.
LIQUIDITY AND CAPITAL RESOURCES
Cash provided by operating activities totaled $854 million for the nine months
ended September 30, 1999, compared to $642 million during the same 1998 period.
Cash flows used in investing activities totaled $327 million and $202 million
for the nine months ended September 30, 1999 and 1998, respectively.
Construction expenditures for the nine months ended September 30, 1999, for
constructing new or improving existing facilities were $342 million, which
included expenditures associated with the purchase of combustion turbine
generators (see Note 6 under Notes to Consolidated Financial Statements for
further information). In addition, the Registrant expended $20 million for the
acquisition of nuclear fuel. Capital requirements for the remainder of 1999 are
expected to be principally for construction expenditures and the acquisition of
nuclear fuel.
Cash flows used in financing activities totaled $273 million for the nine months
ended September 30, 1999, compared to $354 million during the same 1998 period.
The Registrant's principal financing activities for the period included the
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redemption of $119 million of debt and the payment of dividends, partially
offset by the issuance of $58 million of long-term debt. On August 27, 1999, the
Registrant's Board of Directors declared a quarterly dividend of 63.5 cents per
common share that was paid to shareholders on September 30, 1999. Common stock
dividends paid for the 12 months ended September 30, 1999, resulted in a payout
rate of 84 percent of the Registrant's earnings to common stockholders.
Dividends paid to the Registrant's common shareholders relative to net cash
provided by operating activities for the same period were 34 percent.
The Registrant plans to continue utilizing short-term debt to support normal
operations and other temporary requirements. The Registrant and its subsidiaries
are authorized by the Securities and Exchange Commission under PUHCA to have up
to an aggregate $2.8 billion of short-term unsecured debt instruments
outstanding at any one time. Short-term borrowings consist of bank loans
(maturities generally on an overnight basis) and commercial paper (maturities
generally within 10 to 45 days). At September 30, 1999, the Registrant had
committed bank lines of credit aggregating $191 million (all of which was unused
and available at such date) which make available interim financing at various
rates of interest based on LIBOR, the bank certificate of deposit rate or other
options. The lines of credit are renewable annually at various dates throughout
the year. The Registrant also has a bank credit agreement due 2002, which
permits the borrowing of up to $200 million on a short-term basis. This credit
agreement is available for the Registrant's own use and for the use of its
subsidiaries. There was $68 million outstanding under this agreement as of
September 30, 1999. The Registrant had no outstanding short-term borrowings as
of September 30, 1999.
Additionally, AmerenUE has a bank credit agreement due 2000 which permits the
borrowing of up to $300 million on a long-term basis, all of which was unused
and available at September 30, 1999.
AmerenUE also has a lease agreement that provides for the financing of nuclear
fuel. At September 30, 1999, the maximum amount that could be financed under the
agreement was $120 million. Cash used in financing activities for the nine
months ended September 30, 1999, included redemptions under the lease for
nuclear fuel of $11 million, offset by $60 million of issuances. At September
30, 1999, $116 million was financed under the lease.
The Registrant, in the ordinary course of business, explores opportunities to
reduce its cost in order to remain competitive in the marketplace. Areas where
the Company focuses its review include, but are not limited to, labor costs and
fuel supply costs. In the labor area, the Registrant is currently in
negotiations with many of the Registrant's major collective bargaining units in
an effort to manage its labor costs and practices effectively in the future. The
Registrant also explores alternatives to effectively manage the size of its
workforce. These alternatives include utilizing hiring freezes, outsourcing and
offering employee separation packages. In the fuel supply area, the Registrant
explores alternatives to effectively manage its overall fuel costs. These
alternatives include diversifying fuel sources for use at the Registrant's
fossil plants (e.g. utilizing low sulfur versus high sulfur coal), as well as
restructuring or terminating existing contracts with suppliers.
Certain of these reduction alternatives could result in additional investments
being made at the Registrant's power plants in order to utilize different types
of coal, or could require nonrecurring payments of employee separation benefits
or nonrecurring payments to restructure or terminate an existing fuel contract
with a supplier. Management is unable to predict which (if any), and to what
extent, these alternatives to reduce its overall cost structure will be
executed, as well as determine the impact of these actions on the Registrant's
future financial position, results of operations or cash flows.
RATE MATTERS
In March 1999, AmerenUE and AmerenCIPS filed delivery service tariffs with the
Illinois Commerce Commission (ICC) to comply with the requirements of the
Electric Service Customer Choice and Rate Relief Law of 1997. These tariffs
would be used by electric customers who choose to purchase their power from an
alternate supplier. On August 25, 1999, the ICC issued an order approving the
delivery services tariffs, with an allowed rate of return on equity of 10.45%.
AmerenUE and AmerenCIPS filed a joint petition for rehearing of that order
requesting the ICC to alter its conclusions on a number of issues. On October
13, 1999, the ICC granted a rehearing on certain issues. An order on this
reopened proceeding is expected in early 2000.
In August 1999, the Registrant filed a transmission system rate case with the
Federal Energy Regulatory Commission (FERC). This filing was primarily designed
to implement rates, terms and conditions for transmission service for those
retail customers in Illinois which choose other suppliers. On October 14, 1999,
the FERC issued an order suspending the proposed rates until March 25, 2000. The
Registrant filed in response an emergency request for rehearing which requested
that the portion of the filing which related to retail access in Illinois be
placed into effect as of October 1, 1999 to coincide with the start of retail
competition in Illinois. An order from the FERC to this request is expected
shortly. An initial decision as to the Registrant's overall filing is expected
in early 2001.
See Note 5 under Notes to Consolidated Financial Statements for further
discussion of Rate Matters.
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ELECTRIC INDUSTRY RESTRUCTURING
In December 1997, the Governor of Illinois signed the Electric Service Customer
Choice and Rate Relief Law of 1997 (the Law) providing for electric utility
restructuring in Illinois. This legislation introduces competition into the
supply of electric energy in Illinois.
One of the major provisions of the Law includes the phasing-in through 2002 of
retail direct access, which allows customers to choose their electric supplier.
The phase-in of retail direct access began on October 1, 1999, with large
commercial and industrial customers principally comprising the initial group.
The customers in this group represent approximately 10 percent of the
Registrant's total sales. Retail direct access will be offered to the remaining
commercial and industrial customers on December 31, 2000, and to residential
customers on May 1, 2002.
In conjunction with another provision of the Law, in July 1999, AmerenCIPS filed
a notice with the ICC that it intends to transfer AmerenCIPS' generating
facilities (all in Illinois) to a new unregulated subsidiary of Ameren. The
formation of the new generating subsidiary, as well as the transfer of
AmerenCIPS' generating assets and liabilities (at historical net book value) and
certain power sales contracts, will be subject to regulatory proceedings.
Regulatory approval was received from the ICC on October 13, 1999. Other
regulatory approvals are required from the Federal Energy Regulatory Commission
and the Missouri Public Service Commission. In addition to the AmerenCIPS
facilities, the generating subsidiary will include substantially all of the
combustion turbine generators which the Registrant has committed to acquire (see
Note 6 under Notes to Consolidated Financial Statements and the Registrant's
report on Form 8-K dated September 21, 1999 for further information). The new
subsidiary is expected to be operational sometime in 2000, subject to the
outcome of these regulatory proceedings.
Once the transfer is completed, a power supply agreement would be in place
between the new generating company and a nonregulated marketing subsidiary for
all generation. The marketing subsidiary would have a power supply agreement
with AmerenCIPS to supply them sufficient generation to meet native load
requirements over the term of the agreement. Power will continue to be jointly
dispatched between AmerenUE, AmerenCIPS and the new generating subsidiary.
The proposed transfer of generating assets and liabilities had no effect on the
Registrant's financial statements as of September 30, 1999.
YEAR 2000 ISSUE
The Year 2000 Issue relates to how dates are stored and used in computer
systems, applications, and embedded systems. As the century date change occurs,
certain date-sensitive systems need to be able to recognize the year as 2000 and
not as 1900. This inability to recognize and properly treat the year as 2000 may
cause these systems to process critical financial and operational information
incorrectly. The Registrant's primary concern is the potential for any
interruption in providing electric and gas service to customers, as well as the
potential inability to process critical financial and operational information on
a timely basis, including billing its customers, if appropriate steps are not
taken to address this issue. Management has developed a Year 2000 plan (Plan)
and Ameren's Board of Directors has been briefed about the Year 2000 Issue and
how it may affect the Registrant.
The Registrant's Plan to resolve the Year 2000 Issue involves three phases:
assessment, planning, and implementation/testing. Implementation of the Plan is
directly supervised by each area's responsible Vice President. A Year 2000
Project Director coordinates the implementation of the Plan among functional
teams who are addressing issues specific to a particular area, such as nuclear
and non-nuclear generation facilities, energy management systems, gas
distribution, etc. Ameren has also engaged certain outside consultants,
technicians and other external resources to aid in formulating and implementing
the Plan.
The Registrant has completed its assessment phase, which included analyzing
date-sensitive electronic hardware, software applications and embedded systems
and has developed a compliance plan to address issues that were identified. Many
of the major corporate computer systems at Ameren are relatively new and
therefore are either Year 2000 compliant or only require minor modifications.
Also, several of the operating hardware and embedded systems (i.e.,
microprocessor chips) use analog rather than digital technology and thus are
unaffected by the two-digit date issue. In addition, the Registrant has
contacted hundreds of vendors and suppliers to verify compliance.
The Registrant has also completed its planning phase. Items that have been
identified for remediation have been prioritized into groups based on their
significance to Company operations.
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The implementation/testing phase for all mission critical systems was completed
by September 30, 1999. The implementation/testing phase for all other
components/applications is approximately 98 percent complete as of September 30,
1999.
With respect to third parties, for areas that interface directly with
significant vendors, the Registrant has inventoried vendors and major suppliers
and is currently assessing their Year 2000 readiness through surveys, websites
and personal contact. The Registrant plans to follow up with major suppliers and
vendors and verify Year 2000 compliance, where appropriate. The Registrant has
also queried its health insurance providers. To date, the Registrant is not
aware of any problems that would materially impact its financial condition,
results of operations or liquidity. However, the Registrant has no means of
ensuring that these parties will be Year 2000 compliant. The inability of those
parties to complete their Year 2000 resolution process could materially impact
the Registrant.
The Registrant has also addressed the impact of electric power grid problems
that may occur outside of its own electric system. The Registrant has conducted
Year 2000 electric power grid impact planning through the system's various
electric interconnection affiliations and is working with the Mid-American
Interchange Network (MAIN) and the North American Electric Reliability Council
(NERC) to plan Year 2000 operational preparedness and restoration scenarios. As
of September 30, 1999, the Registrant had completed its assessment, planning and
implementation/testing phases for mission critical items as identified by NERC.
As a result, the Registrant has been added to the "Ready" list being compiled by
NERC as it assesses readiness of the regional and national electric grid.
Through the Electric Power Research Institute (EPRI), an industry-wide effort
has been established to deal with Year 2000 problems affecting digital systems
and equipment used by the nation's electric power companies. Under this effort,
participating utilities are working together to assess specific vendors' system
problems and test plans. The assessment is being shared with EPRI participants
to facilitate Year 2000 problem solving.
In addressing the Year 2000 Issue, the Registrant will incur internal labor
costs as well as external consulting and other expenses to prepare for the new
century. The Registrant estimates that its external costs (consulting fees and
related costs) for addressing the Year 2000 Issue will range from $10 million to
$15 million. As of September 30, 1999, the Registrant has expended approximately
$8 million. The Registrant's plans to complete Year 2000 modifications are based
on management's best estimates, which are derived utilizing numerous assumptions
of future events including the continued availability of certain resources, and
other factors. However, there can be no guarantee that these estimates will be
achieved and actual results could differ materially from those plans. Specific
factors that might cause such material differences include, but are not limited
to, the availability and cost of personnel trained in this area, the ability to
locate and correct all relevant computer codes, and similar uncertainties.
The Registrant believes that, with appropriate modifications to existing
computer systems/components, updates by vendors and trading partners, and
conversion to new software and hardware in the ordinary course of business, the
Year 2000 Issue will not pose significant operational problems for the
Registrant. However, if such conversions are not completed in a proper and
timely manner by all affected parties, the Year 2000 Issue could result in
material adverse operational and financial consequences to the Registrant, and
there can be no assurance that the Registrant's efforts, or those of vendors and
trading partners, interconnection affiliates, NERC or EPRI to address the Year
2000 Issue will be successful. The Registrant is in the process of developing
contingency plans to address potential risks, including risks of vendor/trading
partners noncompliance, as well as noncompliance of any of the Registrant's
material operating systems. The first operational contingency plan addressing
power grid issues was completed during the first quarter of 1999. Contingency
plans related to the business areas were completed in July 1999. At this time,
the Registrant is unable to predict the ultimate impact, if any, of the Year
2000 Issue on the Registrant's financial condition, results of operations or
liquidity; however, the impact could be material.
ACCOUNTING MATTERS
In June 1998, the Financial Accounting Standards Board (FASB) issued Statement
of Financial Accounting Standards (SFAS) 133, "Accounting for Derivative
Instruments and Hedging Activities." SFAS 133 establishes accounting and
reporting standards for derivative instruments and for hedging activities and
requires recognition of all derivatives on the balance sheet measured at fair
value. In June 1999, the FASB issued SFAS 137, "Accounting for Derivative
Instruments and Hedging Activities--Deferral of the Effective Date of FASB
Statement No. 133," which delayed the effective date of SFAS 133 to all fiscal
quarters of all fiscal years beginning after June 15, 2000. Earlier application
is still encouraged. At this time, the Registrant is unable to determine the
impact of SFAS 133 on its financial position or results of operations upon
adoption; however, SFAS 133 could increase the volatility of the Registrant's
future earnings.
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QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Market risk represents the risk of changes in value of a financial instrument,
derivative or non-derivative, caused by fluctuations in interest rates and
equity prices. The following discussion of the Registrant's risk management
activities includes "forward-looking" statements that involve risks and
uncertainties. Actual results could differ materially from those projected in
the "forward-looking" statements. The Registrant handles market risks in
accordance with established policies, which may include entering into various
derivative transactions. In the normal course of business, the Registrant also
faces risks that are either non-financial or non-quantifiable. Such risks
principally include credit risk and legal risk and are not represented in the
following analysis.
Interest Rate Risk
The Registrant is exposed to market risk through changes in interest rates,
principally at its subsidiaries, through its issuance of both long-term and
short-term variable-rate debt, fixed-rate debt, commercial paper and auction
market preferred stock. The Registrant manages its interest rate exposure by
controlling the amount of these instruments it holds within its total
capitalization portfolio and by monitoring the effects of market changes in
interest rates.
If interest rates increase 1 percent in 2000 as compared to 1999, the
Registrant's interest expense would increase by approximately $6 million and net
income would decrease by approximately $4 million. This amount has been
determined using the assumptions that the Registrant's outstanding variable rate
debt, commercial paper and auction market preferred stock as of September 30,
1999, continued to be outstanding throughout 2000, and that the average interest
rates for these instruments increased 1 percent over 1999. The model does not
consider the effects of the reduced level of overall economic activity that
would exist in such an environment. In the event of a significant change in
interest rates, management would likely take actions to further mitigate its
exposure to this market risk. However, due to the uncertainty of the specific
actions that would be taken and their possible effects, the sensitivity analysis
assumes no change in the Registrant's financial structure.
Commodity Price Risk
The Registrant is exposed to changes in market prices for natural gas and fuel
and purchased power. With regard to its natural gas utility business, the
Registrant's exposure to changing market prices is in large part mitigated by
the fact that the Registrant has a Purchased Gas Adjustment Clause (PGA) in
place in both its Missouri and Illinois jurisdictions. The PGA allows the
Registrant to pass on to its customers its prudently incurred costs of natural
gas. With approval of the Missouri Public Service Commission, AmerenUE
participated in an experimental program to control the volatility of gas prices
paid by its Missouri customers in the 1998-1999 winter months through the
purchase of financial instruments. This program concluded in April 1999.
Since the Registrant does not have a provision similar to the PGA for its
electric operations, the Registrant has entered into several long-term contracts
with various suppliers to purchase coal and nuclear fuel to manage its exposure
to fuel prices. With regard to the Registrant's exposure to commodity risk for
purchased power, the Registrant has established a subsidiary, AmerenEnergy,
Inc., whose primary responsibility includes managing market risks associated
with the changing market prices for purchased power for the Registrant's
operating subsidiaries, AmerenUE and AmerenCIPS.
AmerenEnergy utilizes several techniques to mitigate its market risk for
purchased power, including utilizing derivative financial instruments. A
derivative is a contract whose value is dependent on or derived from the value
of some underlying asset. The derivative financial instruments that AmerenEnergy
is allowed to utilize (which include forward contracts and futures contracts)
are dictated by a risk management policy, which has been reviewed with the
Auditing Committee of Ameren's Board of Directors. Compliance with the risk
management policy is the responsibility of a risk management steering committee,
consisting of Ameren officers and an independent risk management officer at
AmerenEnergy.
As of September 30, 1999, the fair value of derivative financial instruments
exposed to commodity price risk was immaterial.
Equity Price Risk
The Registrant maintains trust funds, as required by the Nuclear Regulatory
Commission and Missouri and Illinois state laws, to fund certain costs of
nuclear decommissioning. As of September 30, 1999, these funds were invested
primarily in domestic equity securities, fixed-rate, fixed-income securities,
and cash and cash equivalents. By maintaining a portfolio that includes
long-term equity investments, the Registrant is seeking to maximize the returns
to be utilized to fund nuclear decommissioning costs. However, the equity
securities included in the Registrant's portfolio are exposed to price
fluctuations in equity markets, and the fixed-rate, fixed-income securities are
exposed to changes in interest rates. The Registrant actively monitors its
portfolio by benchmarking the performance of its investments against certain
indices
-8-
<PAGE>
and by maintaining, and periodically reviewing, established target allocation
percentages of the assets of its trusts to various investment options. The
Registrant's exposure to equity price market risk is in large part mitigated due
to the fact that the Registrant is currently allowed to recover its
decommissioning costs in its rates.
SAFE HARBOR STATEMENT
Statements made in this Form 10-Q which are not based on historical facts, are
"forward-looking" and, accordingly, involve risks and uncertainties that could
cause actual results to differ materially from those discussed. Although such
"forward-looking" statements have been made in good faith and are based on
reasonable assumptions, there is no assurance that the expected results will be
achieved. These statements include (without limitation) statements as to future
expectations, beliefs, plans, strategies, objectives, events, conditions,
financial performance and the Year 2000 Issue. In connection with the "Safe
Harbor" provisions of the Private Securities Litigation Reform Act of 1995, the
Registrant is providing this cautionary statement to identify important factors
that could cause actual results to differ materially from those anticipated. The
following factors, in addition to those discussed elsewhere in this report and
in the 1998 Annual Report to Stockholders (which is incorporated by reference in
the Registrant's 1998 Form 10-K) and in subsequent securities filings, could
cause results to differ materially from management expectations as suggested by
such "forward-looking" statements: the effects of regulatory actions; changes in
laws and other governmental actions; the impact on the Registrant of current
regulations related to the phasing-in of the opportunity for some customers to
choose alternative energy suppliers in Illinois; the effects of increased
competition in the future due to, among other things, deregulation of certain
aspects of the Registrant's business at both the state and Federal levels;
future market prices for fuel and purchased power, electricity, and natural gas,
including the use of financial instruments; average rates for electricity in the
Midwest; business and economic conditions; interest rates; weather conditions;
fuel prices and availability; generation plant performance; the impact of
current environmental regulations on utilities and the expectation that more
stringent requirements will be introduced over time, which could potentially
have a negative financial effect; monetary and fiscal policies; future wages and
employee benefits costs; and legal and administrative proceedings.
-9-
<PAGE>
AMEREN CORPORATION
CONSOLIDATED BALANCE SHEET
UNAUDITED
(Thousands of Dollars, Except Shares)
<TABLE>
<CAPTION>
September 30, December 31,
ASSETS 1999 1998
- ------ ------------- -------------
<S> <C> <C>
Property and plant, at original cost:
Electric $11,950,939 $11,761,306
Gas 484,735 469,216
Other 46,919 44,646
----------- -----------
12,482,593 12,275,168
Less accumulated depreciation and amortization 5,839,489 5,602,816
----------- -----------
6,643,104 6,672,352
Construction work in progress:
Nuclear fuel in process 134,394 108,294
Other 219,040 147,393
----------- -----------
Total property and plant, net 6,996,538 6,928,039
----------- -----------
Investments and other assets:
Investments 62,865 86,694
Nuclear decommissioning trust fund 172,477 161,877
Other 77,009 78,091
----------- -----------
Total investments and other assets 312,351 326,662
----------- -----------
Current assets:
Cash and cash equivalents 331,114 76,863
Accounts receivable - trade (less allowance for doubtful
accounts of $10,537 and $8,393, respectively) 318,679 198,193
Unbilled revenue 121,201 150,481
Other accounts and notes receivable 68,274 76,919
Materials and supplies, at average cost -
Fossil fuel 122,094 112,908
Other 135,770 132,884
Other 53,323 22,912
----------- -----------
Total current assets 1,150,455 771,160
----------- -----------
Regulatory assets:
Deferred income taxes 628,532 633,529
Other 170,809 188,049
----------- -----------
Total regulatory assets 799,341 821,578
----------- -----------
Total Assets $ 9,258,685 $ 8,847,439
=========== ===========
CAPITAL AND LIABILITIES
Capitalization:
Common stock, $.01 par value, authorized 400,000,000 shares -
outstanding 137,215,462 shares $ 1,372 $ 1,372
Other paid-in capital, principally premium on
common stock 1,582,501 1,582,548
Retained earnings 1,601,612 1,472,200
----------- -----------
Total common stockholders' equity 3,185,485 3,056,120
Preferred stock not subject to mandatory redemption 235,197 235,197
Long-term debt 2,301,586 2,289,424
----------- -----------
Total capitalization 5,722,268 5,580,741
----------- -----------
Minority interest in consolidated subsidiary 3,534 3,534
Current liabilities:
Current maturity of long-term debt 237,156 201,713
Short-term debt -- 58,528
Accounts and wages payable 262,566 297,185
Accumulated deferred income taxes 69,663 66,299
Taxes accrued 302,930 114,106
Other 326,022 216,889
----------- -----------
Total current liabilities 1,198,337 954,720
----------- -----------
Accumulated deferred income taxes 1,510,741 1,521,417
Accumulated deferred investment tax credits 172,811 178,832
Regulatory liability 184,519 198,937
Other deferred credits and liabilities 466,475 409,258
----------- -----------
Total Capital and Liabilities $ 9,258,685 $ 8,847,439
=========== ===========
</TABLE>
See Notes to Consolidated Financial Statements.
-10-
<PAGE>
AMEREN CORPORATION
CONSOLIDATED STATEMENT OF INCOME
UNAUDITED
(Thousands of Dollars, Except Shares and Per Share Amounts)
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended Twelve Months Ended
September 30, September 30, September 30,
------------------------ ----------------------- -----------------------
1999 1998 1999 1998 1999 1998
---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C>
OPERATING REVENUES:
Electric $1,160,693 $1,090,069 $2,620,792 $2,476,977 $3,238,026 $3,124,203
Gas 29,675 25,718 161,600 157,333 220,948 239,249
Other 3,094 1,331 6,856 5,395 8,777 8,175
------------ ---------- ---------- ---------- ---------- ---------
Total operating revenues 1,193,462 1,117,118 2,789,248 2,639,705 3,467,751 3,371,627
OPERATING EXPENSES:
Operations
Fuel and purchased power 295,625 248,086 718,493 620,170 878,446 818,318
Gas 16,481 12,993 89,840 88,282 120,404 142,052
Other 180,202 187,453 483,661 489,344 641,474 640,491
------------ ---------- ---------- ---------- ---------- ---------
492,308 448,532 1,291,994 1,197,796 1,640,324 1,600,861
Maintenance 80,976 66,978 252,115 224,406 339,720 314,852
Depreciation and amortization 90,140 86,160 266,782 259,075 356,110 346,208
Income taxes 162,985 153,581 259,996 242,290 285,379 248,734
Other taxes 70,326 78,215 191,435 213,896 250,313 273,702
------------ ---------- ---------- ---------- ---------- ---------
Total operating expenses 896,735 833,466 2,262,322 2,137,463 2,871,846 2,784,357
OPERATING INCOME 296,727 283,652 526,926 502,242 595,905 587,270
OTHER INCOME AND DEDUCTIONS:
Allowance for equity funds used
during construction 1,141 1,148 6,029 3,415 7,615 5,264
Miscellaneous, net (2,784) (491) (6,718) (5,277) (4,050) (480)
------------ ---------- ---------- ---------- ---------- ----------
Total other income and deductions (1,643) 657 (689) (1,862) 3,565 4,784
INCOME BEFORE INTEREST
CHARGES AND PREFERRED
DIVIDENDS 295,084 284,309 526,237 500,380 599,470 592,054
INTEREST CHARGES AND
PREFERRED DIVIDENDS:
Interest 43,396 46,071 131,444 136,298 176,726 180,404
Allowance for borrowed funds
used during construction (1,292) (1,559) (5,359) (5,548) (6,837) (7,567)
Preferred dividends of subsidiaries 3,161 3,140 9,455 9,414 12,603 12,551
----------- ---------- ---------- ----------- ----------- ---------
Net interest charges and preferred
dividends 45,265 47,652 135,540 140,164 182,492 185,388
INCOME BEFORE
EXTRAORDINARY CHARGE 249,819 236,657 390,697 360,216 416,978 406,666
----------- ---------- ---------- ----------- ----------- ---------
EXTRAORDINARY CHARGE
(NET OF INCOME TAXES) - - - - - (51,820)
----------- ---------- ---------- ----------- ----------- ---------
NET INCOME $ 249,819 $ 236,657 $ 390,697 $ 360,216 $ 416,978 $ 354,846
========== ========== ========= ========== ========== ==========
EARNINGS PER COMMON SHARE -
BASIC AND DILUTED (Based on
average shares outstanding)
Income before extraordinary charge $1.82 $1.73 $2.85 $2.63 $3.04 $2.97
Extraordinary charge - - - - - (0.38)
------ ----- ----- ----- ----- -----
Net income $1.82 $1.73 $2.85 $2.63 $3.04 $2.59
===== ===== ===== ===== ===== =====
AVERAGE COMMON SHARES
OUTSTANDING 137,215,462 137,215,462 137,215,462 137,215,462 137,215,462 137,215,462
=========== =========== =========== =========== =========== ===========
</TABLE>
See Notes to Consolidated Financial Statements.
-11-
<PAGE>
AMEREN CORPORATION
CONSOLIDATED STATEMENT OF CASH FLOWS
UNAUDITED
(Thousands of Dollars)
<TABLE>
<CAPTION>
Nine Months Ended
September 30,
--------------------------
1999 1998
---- ----
<S> <C> <C>
Cash Flows From Operating:
Net income $ 390,697 $360,216
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization 259,447 251,609
Amortization of nuclear fuel 30,823 26,837
Allowance for funds used during construction (11,388) (8,963)
Deferred income taxes, net (16,493) (15,203)
Deferred investment tax credits, net (6,021) (8,859)
Changes in assets and liabilities:
Receivables, net (82,561) (103,856)
Materials and supplies (12,072) (10,872)
Accounts and wages payable (34,619) (90,175)
Taxes accrued 188,824 155,293
Pension and postretirement benefits 33,192 18,397
Credit to customers 42,510 30,416
Other, net 71,519 37,074
----------- -----------
Net cash provided by operating activities 853,858 641,914
Cash Flows From Investing:
Construction expenditures (342,352) (215,252)
Allowance for funds used during construction 11,388 8,963
Nuclear fuel expenditures (19,662) (7,523)
Other 23,829 11,388
----------- -----------
Net cash used in investing activities (326,797) (202,424)
Cash Flows From Financing:
Dividends on common stock (261,395) (261,395)
Environmental bond redemption fund - (160,000)
Redemptions -
Nuclear fuel lease (11,332) (53,670)
Short-term debt (58,528) (30,063)
Long-term debt (60,000) (45,000)
Issuances -
Nuclear fuel lease 60,045 9,917
Long-term debt 58,400 186,200
--------- ---------
Net cash used in financing activities (272,810) (354,011)
--------- ---------
Net increase in cash and cash equivalents 254,251 85,479
Cash and cash equivalents at beginning of year 76,863 42,425
--------- ---------
Cash and cash equivalents at end of period $ 331,114 $ 127,904
========= =========
Cash paid during the periods:
Interest (net of amount capitalized) $111,005 $118,075
Income taxes, net $153,260 $164,556
</TABLE>
See Notes to Consolidated Financial Statements
-12-
<PAGE>
AMEREN CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
September 30, 1999
Note 1 - Ameren Corporation (Ameren) is a holding company registered under the
Public Utility Holding Company Act of 1935 (PUHCA). In December 1997, Union
Electric Company (AmerenUE) and CIPSCO Incorporated (CIPSCO) combined to form
Ameren, with AmerenUE and CIPSCO's subsidiaries, Central Illinois Public Service
Company (AmerenCIPS) and CIPSCO Investment Company (CIC), becoming wholly-owned
subsidiaries of Ameren (the Merger). The accompanying consolidated financial
statements (the financial statements) reflect the accounting for the Merger as a
pooling of interests and are presented as if the companies were combined as of
the earliest period presented. However, the financial information is not
necessarily indicative of the results of operations, financial position or cash
flows that would have occurred had the Merger been consummated for the periods
for which it is given effect, nor is it necessarily indicative of future results
of operations, financial position or cash flows. The outstanding preferred stock
of AmerenUE and AmerenCIPS were not affected by the Merger.
The accompanying financial statements include the accounts of Ameren and its
consolidated subsidiaries (collectively the Registrant). All subsidiaries for
which the Registrant owns directly or indirectly more than 50 percent of the
voting stock are included as consolidated subsidiaries. Ameren's primary
operating companies, AmerenUE and AmerenCIPS, are engaged principally in the
generation, transmission, distribution and sale of electric energy and the
purchase, distribution, transportation and sale of natural gas. The operating
companies serve 1.5 million electric and 300,000 natural gas customers in a
44,500-square-mile area of Missouri and Illinois. The Registrant's non-regulated
subsidiaries include CIC, an investing subsidiary, and AmerenEnergy, Inc., an
energy marketing subsidiary. The Registrant also has a 60 percent interest in
Electric Energy, Inc. (EEI). EEI owns and operates an electric generation and
transmission facility in Illinois that supplies electric power primarily to a
uranium enrichment plant located in Paducah, Kentucky. All significant
intercompany balances and transactions have been eliminated from the
consolidated financial statements.
Note 2 - Financial statement note disclosures, normally included in consolidated
financial statements prepared in conformity with generally accepted accounting
principles, have been omitted in this Form 10-Q pursuant to the Rules and
Regulations of the Securities and Exchange Commission. However, in the opinion
of the Registrant, the disclosures contained in this Form 10-Q are adequate to
make the information presented not misleading. See Notes to Consolidated
Financial Statements included in the 1998 Annual Report to Stockholders (which
is incorporated by reference in the Registrant's 1998 Form 10-K) for information
relevant to the consolidated financial statements contained in this Form 10-Q,
including information as to the significant accounting policies of the
Registrant.
Note 3 - In the opinion of the Registrant, the interim financial statements
filed as part of this Form 10-Q reflect all adjustments, consisting only of
normal recurring adjustments, necessary for a fair statement of the results for
the periods presented. The Registrant's consolidated financial statements were
prepared to permit the information required in the Financial Data Schedule
(FDS), Exhibit 27, to be directly extracted from the filed statements. The FDS
amounts correspond to or are calculable from the amounts reported in the
consolidated financial statements or notes thereto.
Note 4 - Due to the effect of weather on sales and other factors which are
characteristic of public utility operations, financial results for the periods
ended September 30, 1999 and 1998, are not necessarily indicative of trends for
any three-month, nine-month or twelve-month period.
Note 5 - In July 1995, the Missouri Public Service Commission (MoPSC) approved
an agreement involving AmerenUE's Missouri electric rates. The Agreement
included a three-year experimental alternative regulation plan that provides
that earnings in excess of a 12.61 percent regulatory return on equity (ROE)
will be shared equally between customers and shareholders and earnings above 14
percent ROE will be credited to customers. The formula for computing the credit
uses twelve-month results ending June 30, rather than calendar year earnings.
The Registrant recorded an estimated $43 million credit for the final year of
the original experimental alternative regulation plan. The MoPSC staff has
proposed adjustments to the Registrant's estimated $43 million credit, which if
ultimately accepted, could increase the Registrant's estimated credit up to
approximately $5 million. Hearings were held on this matter in June 1999, and a
final order from the MoPSC is expected by the end of 1999.
-13-
<PAGE>
A new three-year experimental alternative regulation plan was included in the
joint agreement approved by the MoPSC in its February 1997 order approving the
Merger. Like the original plan, the new plan requires that earnings over a 12.61
percent ROE up to a 14 percent ROE will be shared equally between customers and
stockholders. The new three-year plan will also return to customers 90 percent
of all earnings above a 14 percent ROE up to a 16 percent ROE. Earnings above a
16 percent ROE will be credited entirely to customers. As of September 30, 1999,
the Registrant had recorded an estimated $20 million credit for the first year
of this plan. This credit was reflected as a reduction in electric revenues.
The joint agreement approved by the MoPSC in its February 1997 order approving
the Merger also provided for a Missouri electric rate decrease, retroactive to
September 1, 1998, based on the weather-adjusted average annual credits to
customers under the original experimental alternative regulation plan. The MoPSC
staff proposed adjustments to the Registrant's methodology of calculating the
weather-adjusted credits. During the second quarter of 1999, the Registrant and
the MoPSC staff reached a settlement on the methodology for calculating the
weather-adjusted credits. This proposed settlement is subject to approval by the
MoPSC. In addition, the results of the regulatory proceeding associated with the
final year of the original experimental alternative regulation plan will impact
the final Missouri electric rate decrease as well. The Registrant estimates that
its Missouri electric rate decrease should approximate $15 million to $20
million on an annualized basis. A final order from the MoPSC is expected by the
end of 1999.
In conjunction with the Electric Service Customer Choice and Rate Relief Law of
1997 (the Law), a 5 percent residential electric rate decrease for the
Registrant's Illinois electric customers was effective August 1, 1998. This rate
decrease is expected to decrease electric revenues $14 million annually, based
on estimated levels of sales and assuming normal weather conditions. The
Registrant may be subject to additional 5 percent residential electric rate
decreases in each of 2000 and 2002, to the extent its rates exceed the Midwest
utility average at that time. The Registrant's rates are currently below the
Midwest utility average.
The Law also contains a provision requiring one-half of excess earnings from the
Illinois jurisdiction for the years 1998 through 2004 to be refunded to the
Registrant's customers. Excess earnings are defined as the portion of the
two-year average annual rate of return on common equity in excess of 1.5 percent
of the two-year average of an Index, as defined in the Law. The Index is defined
as the sum of the average for the twelve months ended September 30 of the
average monthly yields of the 30-year U.S. Treasury bonds plus prescribed
percentages ranging from 4 percent to 5 percent. In July 1999, Senate Bill 24
was passed which increased the prescribed percentages to 7 percent beginning in
2000. Filings must be made with the Illinois Commerce Commission on or before
March 31 of each year 2000 through 2005. As of September 30, 1999, the
Registrant recorded an estimated $10 million credit it expects to return to its
customers under the Law for the two year period ended December 31, 1999.
Note 6 - The Registrant has committed to purchase combustion turbine generators
(CTs). The CTs will add over 2000 megawatts to the Registrant's net peaking
capacity and are expected to cost approximately $940 million. CTs with a total
capacity of approximately 530 megawatts are planned to be installed in 2000, 560
megawatts in 2001, 590 megawatts in 2002, and 325 megawatts in 2003. Except for
approximately 120 megawatts, the new capacity is expected to be operated by the
Registrant's proposed new unregulated generating subsidiary.
Note 7 - Statement of Position (SOP) 98-1, "Accounting for the Costs of Computer
Software Developed or Obtained for Internal Use" became effective on January 1,
1999. SOP 98-1 provides guidance on accounting for the costs of computer
software developed or obtained for internal use. Under SOP 98-1, certain costs
may be capitalized and amortized over some future period. SOP 98-1 did not have
a material impact on the Registrant's financial position or results of
operations upon adoption.
The Emerging Issues Task Force of the Financial Accounting Standards Board
(EITF) Issue 98-10, "Accounting for Energy Trading and Risk Management
Activities" became effective on January 1, 1999. EITF 98-10 provides guidance on
the accounting for energy contracts entered into for the purchase or sale of
electricity, natural gas, capacity and transportation. The EITF reached a
consensus in EITF 98-10 that sales and purchase activities being performed need
to be classified as either trading or non-trading. Furthermore, transactions
that are determined to be trading activities would be recognized on the balance
sheet measured at fair value, with gains and losses included in earnings. EITF
98-10 includes factors or indicators to consider when determining if a
transaction is a trading or non-trading activity. Currently, AmerenEnergy, Inc.,
an energy marketing subsidiary of Ameren, enters into contracts for the sale and
purchase of energy on behalf of AmerenUE and AmerenCIPS. These transactions are
considered non-trading activities and are accounted for using the accrual or
settlement method, which represents
-14-
<PAGE>
industry practice. Should any of AmerenEnergy's future activities be considered
material trading activities based on the indicators provided in EITF 98-10, a
change in accounting practice would be required. EITF 98-10 did not have a
material impact on the Registrant's financial position or results of operations
upon adoption.
Note 8 - Segment information for the three month, nine month and 12 month
periods ended September 30, 1999 and 1998 is as follows:
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------
Regulated Reconciling
(in millions) Utilities All Other Items * Total
- ---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Three months ended September 30, 1999:
Revenues $1,185 $ 62 $(54) $ 1,193
Net Income 248 2 -- 250
- ---------------------------------------------------------------------------------------------------------
Three months ended September 30, 1998:
Revenues $1,093 $ 62 $(38) $1,117
Net Income 242 (5) -- 237
- ---------------------------------------------------------------------------------------------------------
Nine months ended September 30, 1999:
Revenues $2,742 $182 $(135) $ 2,789
Net Income 387 4 -- 391
- ---------------------------------------------------------------------------------------------------------
Nine months ended September 30, 1998:
Revenues $2,575 $143 $(78) $ 2,640
Net Income 360 -- -- 360
- ---------------------------------------------------------------------------------------------------------
12 months ended September 30, 1999:
Revenues $3,397 $230 $(159) $ 3,468
Net Income 408 9 -- 417
- ---------------------------------------------------------------------------------------------------------
12 months ended September 30, 1998:
Revenues $3,267 $200 (95) $ 3,372
Net Income 352 3 -- 355
- ---------------------------------------------------------------------------------------------------------
* Elimination of intercompany revenues.
</TABLE>
Note 9 - Certain reclassifications were made to prior-year financial statements
to conform to current-period presentation.
-15-
<PAGE>
PART II. OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits.
Exhibit 27 - Financial Data Schedule.
(b) Reports on Form 8-K. The Registrant filed a report on Form 8-K dated
September 21, 1999, reporting on the Registrant's commitment to purchase
additional combustion turbine generators to add to its peaking capacity.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
AMEREN CORPORATION
(Registrant)
By /s/ Donald E. Brandt
------------------------
Donald E. Brandt
Senior Vice President, Finance
(Principal Financial Officer)
Date: November 15, 1999
-16-
<TABLE> <S> <C>
<ARTICLE> UT
<LEGEND>
Exhibit 27
AMEREN CORPORATION
10-Q SEPTEMBER 30, 1999
FINANCIAL DATA SCHEDULE UT
PUBLIC UTILITY COMPANIES AND PUBLIC UTILITY HOLDING COMPANIES
APPENDIX E TO ITEM 601 (C) OF REGULATION S-K
(Thousands of Dollars Except Per Share Amounts)
</LEGEND>
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-END> SEP-30-1999
<BOOK-VALUE> PER-BOOK
<TOTAL-NET-UTILITY-PLANT> 6,996,538
<OTHER-PROPERTY-AND-INVEST> 235,342
<TOTAL-CURRENT-ASSETS> 1,150,455
<TOTAL-DEFERRED-CHARGES> 77,009
<OTHER-ASSETS> 799,341
<TOTAL-ASSETS> 9,258,685
<COMMON> 1,372
<CAPITAL-SURPLUS-PAID-IN> 1,582,501
<RETAINED-EARNINGS> 1,601,612
<TOTAL-COMMON-STOCKHOLDERS-EQ> 3,185,485
0
235,197
<LONG-TERM-DEBT-NET> 2,205,286
<SHORT-TERM-NOTES> 0
<LONG-TERM-NOTES-PAYABLE> 0
<COMMERCIAL-PAPER-OBLIGATIONS> 0
<LONG-TERM-DEBT-CURRENT-PORT> 217,844
0
<CAPITAL-LEASE-OBLIGATIONS> 96,300
<LEASES-CURRENT> 19,312
<OTHER-ITEMS-CAPITAL-AND-LIAB> 3,299,261
<TOT-CAPITALIZATION-AND-LIAB> 9,258,685
<GROSS-OPERATING-REVENUE> 2,789,248
<INCOME-TAX-EXPENSE> 259,996
<OTHER-OPERATING-EXPENSES> 2,002,326
<TOTAL-OPERATING-EXPENSES> 2,262,322
<OPERATING-INCOME-LOSS> 526,926
<OTHER-INCOME-NET> (689)
<INCOME-BEFORE-INTEREST-EXPEN> 526,237
<TOTAL-INTEREST-EXPENSE> 126,085
<NET-INCOME> 390,697
9,455
<EARNINGS-AVAILABLE-FOR-COMM> 390,697
<COMMON-STOCK-DIVIDENDS> 261,395
<TOTAL-INTEREST-ON-BONDS> 0 <F1>
<CASH-FLOW-OPERATIONS> 853,858
<EPS-BASIC> 2.85
<EPS-DILUTED> 2.85
<FN>
<F1> Required in fiscal year-end only.
</FN>
</TABLE>
