As filed on February 16, 1999
File No. 70-9341
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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PRE-EFFECTIVE AMENDMENT
NO. 2
TO THE
FORM U-1 APPLICATION/DECLARATION
UNDER
THE PUBLIC UTILITY HOLDING COMPANY ACT OF 1935
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New Century Energies, Inc.
1225 Seventeenth Street
Denver, CO 80202-5534
(Names of companies filing this statement
and addresses of principal executive offices)
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New Century Energies, Inc.
(Name of top registered holding company parent)
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Teresa S. Madden, Controller
New Century Energies, Inc.
1225 Seventeenth Street
Denver, Colorado 80202-5534
(Name and address of agent for service)
The Commission is requested to send copies of all notices, orders and
communications in connection with this Application/Declaration to:
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William M. Dudley, Esq. William T. Baker, Jr., Esq.
New Century Services, Inc. Thelen Reid & Priest LLP
1225 Seventeenth Street 40 West 57th Street
Denver, Colorado 80202-5534 New York, New York 10019-4097
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<PAGE>
New Century Energies, Inc. ("NCE") hereby amends its
Application/Declaration on Form U-1, docketed in File No. 70-9341, as previously
amended by Pre-Effective Amendment No. 1, as follows:
1. By replacing the first paragraph (including footnote 3) of Item 1.B.
(Proposed Modifications to Prior Orders; Applicability of Proposed Transactions
to Pending and Future NCE Financing Applications) with the following:
As of December 31, 1997, NCE's aggregate investment in EWGs
and FUCOs, pro forma to include NCE's initial investments in Yorkshire
Electricity and IPC, was approximately $375.2 million, and its average
consolidated retained earnings were approximately $715.6 million. As of
September 30, 1998, the aggregate investment figure was the same, and
average consolidated retained earnings were approximately $677.8
million. NCE's aggregate investment, including Yorkshire Electricity
and IPC, pro forma, is in excess of the 50% limit in Rule 53(a)(1).3 On
the other hand, if NCE had authority to make aggregate investments in
EWGs and FUCOs in an amount equal to 100% of its consolidated retained
earnings using proceeds from its external financings or other
credit-supported arrangements, NCE could have invested an additional
$340.4 million as of December 31, 1997, or $302.6 million as of
September 30, 1998.
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3 The ratio of NCE's aggregate investment to its average
consolidated retained earnings as of December 31, 1997,
equaled 52.4% and as of September 30, 1998, equaled 55.4%. The
event that caused the NCE system to exceed 50% of average
consolidated retained earnings was the imposition of a U.K.
government-mandated windfall tax on Yorkshire Electricity,
which is discussed below, not a new investment.
2. By replacing Item 3.B.2.b.i. (Debt/equity ratios) with the following:
Debt (including short-term debt) ratios of the two major NCE
Operating Companies - i.e., PSCo and SPS15A - are consistent with
the industry range for A-rated electric utilities. The current
industry average for A-rated electric utilities is approximately
55%.16 Cheyenne's debt ratio is somewhat higher due to
significant capital expenditures being incurred to meet growing
requirements of its utility operations.
<PAGE>
Debt as % of Capitalization 1995 1996 1997 9/30/98
- --------------------------- ---- ---- ---- -------
PSCo 51% 51% 50%* 52%
SPS 42% 49% 49% 47%
CLFP 61.8% 63.8% 68.5% 74.7%
* Restated to eliminate effect of U.K. Windfall Tax.
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15A PSCo's and SPS's unconsolidated total assets, before
elimination entries, constitute approximately 72% and 29%,
respectively, of NCE's consolidated total assets. In contrast,
Cheyenne's assets constitute approximately 1% of NCE's
consolidated total assets. The Commission has previously
recognized the relatively small size of the Cheyenne system.
See Merger Order at 34-35.
16 Standard & Poor's Utility Financial Statistics (Nov. 1998).
3. By replacing the table "PREFERRED STOCK RATINGS" in Item 3.B.2.b.iii.
(Security ratings) with the following:
PREFERRED STOCK RATINGS
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S&P Moody's Duff & Phelps'
Rating Rating Rating
------ ------- --------------
PSCo trust originated
preferred securities BBB+ baa1 A-
SPS trust originated
preferred securities A- aa3 AA-
4. By replacing the last sentence of Item 3.B.2.b.ii. (Earnings coverages)
with the following:
Accordingly, the NCE Operating Companies should have more than
adequate earnings coverages to permit the issuance of securities to
third parties in amounts that will satisfy their external finance
requirements in the foreseeable future.
5. By replacing the fourth paragraph (numbered paragraph 3) of Item 3.C
(Compliance with Rule 54) with the following:
3. Consolidated capitalization ratios as of the
end of that quarter (including non-recourse and short-term debt
reflected in the NCE consolidation);
2
<PAGE>
SIGNATURE
Pursuant to the requirements of the Public Utility Holding Company Act
of 1935, as amended, the undersigned company has duly caused this Pre-Effective
Amendment No. 2 to the Application/Declaration to be signed on its behalf by the
undersigned thereunto duly authorized.
NEW CENTURY ENERGIES, INC.
By /s/ Richard C. Kelly
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Name: Richard C. Kelly
Title: Executive Vice President and
Chief Financial Officer of
New Century Energies, Inc.
Date: February 16, 1999