<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 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 MARCH 31, 1997
[ ] 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 1-2967.
UNION ELECTRIC COMPANY
(Exact name of registrant as specified in its charter)
Missouri 43-0559760
(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 April
30, 1997:
Common Stock, $5 par value - 102,123,834
(excl. 42,990 treasury shares)
<PAGE> 2
UNION ELECTRIC COMPANY
----------------------
INDEX
-----
Page No.
Part I Financial Information (Unaudited)
Balance Sheet --
March 31, 1997 and December 31, 1996 2
Statement of Income --
Three Months and 12 Months Ended
March 31, 1997 and 1996 3
Statement of Cash Flows --
Three Months Ended March 31, 1997 and 1996 4
Notes to Financial Statements 5
Management's Discussion and Analysis 6 thru 9
Part II Other Information
<PAGE> 3
<TABLE>
<CAPTION>
UNION ELECTRIC COMPANY Page 2
----------------------
BALANCE SHEET
-------------
UNAUDITED
---------
(Thousands of Dollars) March 31, December 31,
ASSETS: 1997 1996
- ------- ----------- ------------
<S> <C> <C>
Property and plant, at original cost
Electric $8,701,243 $8,630,628
Gas 188,075 185,867
Other 35,971 35,965
---------- ----------
8,925,289 8,852,460
Less accumulated depreciation and amortization 3,715,215 3,656,890
---------- ----------
5,210,074 5,195,570
Construction work in progress:
Nuclear fuel in process 99,928 96,147
Other 80,725 90,953
---------- ---------
Total property and plant, net 5,390,727 5,382,670
Regulatory assets:
Deferred income taxes 674,547 692,171
Other 175,095 178,760
---------- ----------
Total regulatory assets 849,642 870,931
Deferred charges:
Unamortized debt expense 10,446 10,591
Nuclear decommissioning trust fund 100,366 96,601
Other 29,126 27,377
---------- ----------
Total deferred charges 139,938 134,569
Current assets:
Cash 14,010 4,897
Accounts receivable - trade (less allowance for doubtful
accounts of $4,934 and $5,195 at respective dates) 183,233 192,868
Unbilled revenue 45,862 76,190
Other accounts and notes receivable 32,403 37,190
Materials and supplies, at average cost -
Fossil fuel 53,938 63,651
Construction and maintenance 95,992 94,517
Other 10,244 13,326
---------- ----------
Total current assets 435,682 482,639
---------- ----------
Total Assets $6,815,989 $6,870,809
========== ==========
CAPITAL AND LIABILITIES:
- ------------------------
Capitalization:
Common stock, $5 par value, authorized 150,000,000 shares-
102,123,834 outstanding (excl. 42,990 at par value in treasury) $ 510,619 $ 510,619
Other paid-in capital 716,879 717,669
Retained earnings 1,091,090 1,126,513
---------- ----------
Total common stockholders' equity 2,318,588 2,354,801
Preferred stock not subject to mandatory redemption 155,197 218,497
Preferred stock subject to mandatory redemption -- 624
Capital lease obligation 80,798 77,168
Long-term debt, net 1,879,651 1,721,503
---------- ----------
Total capitalization 4,434,234 4,372,593
Accumulated deferred income taxes 1,317,792 1,318,404
Accumulated deferred investment tax credits 158,799 160,342
Regulatory liability 196,590 203,822
Accumulated provision for nuclear decommissioning 102,039 98,274
Other deferred credits and liabilities 158,119 156,913
Current and accrued liabilities:
Current maturity of capital lease obligation 32,631 28,966
Current maturity of long-term debt 5,000 45,000
Accounts payable 69,169 170,383
Wages payable 35,323 39,966
Bank loans 33,900 11,300
Accumulated deferred income taxes 33,858 43,933
Income taxes accrued 59,329 35,505
Other taxes accrued 38,182 16,040
Interest accrued 55,254 45,173
Dividends accrued 2,204 3,004
Other 83,566 121,191
---------- -----------
Total current and accrued liabilities 448,416 560,461
---------- ----------
Total Capital and Liabilities $6,815,989 $6,870,809
========== ==========
</TABLE>
<PAGE> 4
UNION ELECTRIC COMPANY Page 3
----------------------
STATEMENT OF INCOME
-------------------
(UNAUDITED)
-----------
(Thousands of Dollars Except Shares and Per Share Amounts)
<TABLE>
<CAPTION>
Three Months Ended Twelve Months Ended
March 31, March 31,
---------------------- --------------------------
1997 1996 1997 1996
---- ---- ---- ----
<S> <C> <C> <C> <C>
Operating revenues:
Electric $440,967 $450,865 $2,150,917 $2,168,289
Gas 46,110 44,548 100,626 94,149
Steam 181 157 509 443
-------- -------- ---------- ----------
Total operating revenue 487,258 495,570 2,252,052 2,262,881
Operating expenses:
Operations
Fuel and purchased power 116,191 124,264 504,758 512,243
Other 122,986 114,129 452,512 423,865
-------- -------- ---------- ----------
239,177 238,393 957,270 936,108
Maintenance 49,198 48,634 224,195 220,075
Depreciation and decommissioning 61,444 59,585 243,158 235,221
Income taxes 21,335 28,221 190,483 213,902
Other taxes 50,517 50,983 212,799 213,231
-------- -------- ---------- ----------
Total operating expenses 421,671 425,816 1,827,905 1,818,537
Operating income 65,587 69,754 424,147 444,344
Other income and deductions:
Allowance for equity funds used
during construction 877 1,702 5,667 6,637
Miscellaneous, net (1,081) 895 (6,269) (5,733)
-------- -------- ---------- ----------
Total other income/deductions, net (204) 2,597 (602) 904
Income before interest charges 65,383 72,351 423,545 445,248
Interest charges:
Interest 35,180 33,858 133,966 135,163
Allowance for borrowed funds
used during construction (1,427) (1,647) (6,787) (5,938)
-------- -------- ---------- ----------
Net interest charges 33,753 32,211 127,179 129,225
Net income 31,630 40,140 296,366 316,023
Preferred stock dividends 2,204 3,312 12,141 13,249
-------- -------- ---------- ----------
Earnings on common stock $ 29,426 $ 36,828 $ 284,225 $ 302,774
======== ======== ========== ==========
Earnings per share of common stock
(based on average shares outstanding) $ 0.29 $ 0.36 $ 2.78 $ 2.96
======== ======== ========== ==========
Dividends per share of common stock $ 0.635 $ 0.625 $ 2.52 $ 2.47
======== ======== ========== ==========
Average number of common shares
outstanding (in thousands) 102,124 102,124 102,124 102,124
======== ======== ========== ==========
</TABLE>
<PAGE> 5
UNION ELECTRIC COMPANY Page 4
----------------------
STATEMENT OF CASH FLOWS
-----------------------
UNAUDITED
---------
(Thousands of Dollars)
<TABLE>
<CAPTION>
Three Months Ended
March 31,
--------------------
1997 1996
---- ----
<S> <C> <C>
Cash Flows From Operating:
Net income $ 31,630 $ 40,140
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization 59,165 57,173
Amortization of nuclear fuel 9,834 10,723
Allowance for funds used during construction (2,304) (3,349)
Deferred income taxes, net (296) 4,832
Deferred investment tax credits, net (1,543) (1,547)
Changes in assets and liabilities:
Receivables, net 44,750 27,874
Materials and supplies 8,238 7,297
Accounts and wages payable (105,857) (88,303)
Taxes accrued 45,966 45,387
Interest and dividends accrued or declared 9,281 8,215
Other, net (33,309) 11,086
---------- --------
Net cash provided by operating activities 65,555 119,528
Cash Flows From Investing:
Construction expenditures (71,942) (83,605)
Allowance for funds used during construction 2,304 3,349
Nuclear fuel expenditures (3,722) (18,054)
---------- --------
Net cash used in investing activities (73,360) (98,310)
Cash Flows From Financing:
Dividends on preferred stock (2,204) (3,312)
Dividends on common stock (64,849) (63,828)
Redemptions -
Nuclear fuel lease (4,615) (7,959)
Long-term debt (40,000) (5,000)
Preferred stock (63,924) --
Issuances -
Nuclear fuel lease 11,910 13,173
Short-term debt 22,600 16,900
Long-term debt 158,000 40,000
----------- --------
Net cash provided by (used in) financing activities 16,918 (10,026)
Net change in cash and cash equivalents 9,113 11,192
Cash and cash equivalents at beginning of period 4,897 1,025
----------- --------
Cash and cash equivalents at end of period $ 14,010 $ 12,217
=========== ========
Supplemental disclosure of cash flow information:
Cash and cash equivalents include cash on hand and temporary
investments purchased with a maturity of three months or less
Cash paid during the period:
Interest (net of amount capitalized) $ 20,981 $ 22,422
Income taxes 1 170
</TABLE>
<PAGE> 6
Page 5
UNION ELECTRIC COMPANY
----------------------
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
Note 1 - Financial statement note disclosures, normally included in 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 Financial Statements included in the 1996
Annual Report on Form 10-K for information relevant to the financial
statements contained in this Form 10-Q, including information as to
the significant accounting policies of the registrant.
Note 2 - 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. Registrant's 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 financial statements or
notes thereto.
Note 3 - Due to the effect of weather on sales and other factors which are
characteristic of public utility operations, financial results for
the periods ended March 31, 1997 and 1996 are not necessarily
indicative of trends for any three-month or 12-month period.
Note 4 - On July 21, 1995, the Missouri Public Service Commission (MoPSC)
approved an agreement involving the registrant'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 a 14 percent
ROE will be credited to customers. The formula for computing the
credit uses 12-month results ending June 30, rather than calendar
year earnings. At March 31, 1997, the registrant estimated that it
will pay a credit of at least $12 million to its Missouri electric
customers later in 1997 for the second year of the plan. This credit
was reflected as a reduction in electric revenues. The final amount
of the credit will depend on several factors, including the
registrant's earnings for the 12 months ending June 30, 1997.
Note 5 - On April 30, 1997, the Federal Energy Regulatory Commission
administrative law judge issued an Initial Decision finding that,
subject to certain conditions, the merger between the registrant and
CIPSCO Incorporated is in the public interest and should be approved.
The conditions relate to issues associated with certain power and
transmission service agreements with other utilities. A final order
from the Federal Energy Regulatory Commission is expected later this
year.
Note 6 - Certain reclassifications were made to prior-year financial
statements to conform with current-period presentation.
<PAGE> 7
Page 6
UNION ELECTRIC COMPANY
----------------------
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF THE RESULTS OF OPERATIONS
The registrant and CIPSCO Incorporated entered into a Merger Agreement
dated August 11, 1995, which was approved by the shareholders of both companies
in December 1995. The merged entity is expected to realize $644 million in net
savings over 10 years from combining certain operations of the two companies
and is expected to adopt Union Electric's dividend payment level. However, the
merger is conditioned upon, among other things, receipt of certain regulatory
and governmental approvals. The merger is expected to be consummated by the
end of 1997. (See Note 5 to the Financial Statements of this report.)
RESULTS OF OPERATIONS
First-quarter 1997 common stock earnings declined $7.4 million, or 7
cents per share, from 1996's first quarter to $29.4 million, or 29 cents per
share. Common stock earnings for the 12 months ended March 31, 1997, were
$284.2 million, or $2.78 per share, an $18.6 million, or 18 cent-per-share,
decrease from the preceding 12-month period.
Earnings and earnings per share fluctuated due to many conditions, the
primary ones being: weather variations, electric rate reductions, credits to
electric customers, sales growth, fluctuating operating costs and
merger-related costs. The significant items affecting revenues, costs and
earnings during the three-month and 12-month periods ended March 31, 1997, and
1996 are detailed below:
<TABLE>
<CAPTION>
Electric Operating Revenues
- ---------------------------
(Millions of Dollars) Variations for periods ended March 31, 1997
from comparable prior-year periods
---------------------------------------------------
Three Months Twelve Months
------------ -------------
<S> <C> <C>
Rate variations $ - $(12.7)
Credits to customers 1.5 .3
Effect of abnormal weather (10.7) (41.0)
Growth and other (3.9) 31.9
Interchange sales 3.2 4.1
------ ------
$ (9.9) $(17.4)
====== ======
</TABLE>
The $9.9 million decrease in first-quarter electric revenues compared
to the year-ago quarter is primarily due to milder winter weather and one less
day in the quarter due to leap year in 1996, partly offset by increased
interchange sales. Weather-sensitive residential and commercial sales declined
4 percent and 2 percent, respectively, while industrial sales were unchanged
compared to the year-ago quarter. Interchange sales increased 16 percent
compared to the same prior-year period due to increased available power for
resale.
Electric revenues for the 12 months ended March 31, 1997, decreased
$17.4 million primarily due to the effects of the rate decrease and milder
weather during the 12-month period, partially offset by the positive effects of
economic growth in the registrant's service area and increased interchange
sales. Total kilowatthour sales increased 1 percent with interchange sales
growing by nearly 6 percent. Commercial sales increased 1 percent and
industrial sales rose 2 percent, while weather-sensitive residential sales
decreased 1 percent.
<PAGE> 8
Page 7
UNION ELECTRIC COMPANY
----------------------
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF THE RESULTS OF OPERATIONS (Continued)
Operating Expenses
- ------------------
<TABLE>
<CAPTION>
Fuel and Purchased Power Variations for periods ended March 31, 1997
- ------------------------ from comparable prior-year periods
(Millions of Dollars) -------------------------------------------------------
Three Months Twelve Months
-------------- -------------
<S> <C> <C>
Fuel:
Variation in generation $ 2.0 $ 10.5
Price (2.0) (13.5)
Generation efficiencies and other (1.1) (.6)
Purchased power variation (7.0) (3.9)
-------- ----------
$ (8.1) $ (7.5)
======== ==========
</TABLE>
The decline in fuel and purchased power costs for the three months
ended March 31, 1997, versus the comparable prior year quarter was primarily
due to reduced purchased power costs resulting from lower native load sales and
increased generation.
The decrease in fuel and purchased power costs for the 12 months ended
March 31, 1997, versus the comparable prior-year period was driven mainly by
lower fuel prices and reduced purchased power costs partially offset by
increased generation.
Other Operating Expenses
- ------------------------
Other operating expense variations reflect recurring conditions such as
growth, inflation and wage increases.
First quarter 1997 operations expenses other than fuel and purchased
power increased $9 million over last year's first quarter primarily due to an
increase in gas purchased for resale (due to higher gas prices), and increased
consulting and injuries and damages expenses.
For the 12 months ended March 31, 1997, operations expenses other than
fuel and purchased power were up $29 million versus the comparable year-ago
period. This increase is primarily due to higher gas purchased for resale
costs and increases in consulting expenses, employee benefits costs, and
injuries and damages expenses. Maintenance expenses for the current 12-month
period increased $4 million primarily due to higher labor expenses.
<PAGE> 9
Page 8
UNION ELECTRIC COMPANY
----------------------
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF THE RESULTS OF OPERATIONS (Continued)
Depreciation expense for the three-month and 12-month periods ended
March 31, 1997, increased $2 million, and $8 million, respectively, versus
comparable 1996 periods, primarily due to increases in depreciable property.
Income taxes charged to operating expenses for the three months and 12
months ended March 31, 1997, decreased $7 million and $23 million,
respectively, versus the comparable 1996 periods, primarily due to lower pretax
income.
Other Income and Deductions
- ---------------------------
Miscellaneous other net income and deductions for the three months
ended March 31, 1997, decreased $2 million, versus the comparable 1996 period,
primarily due to increased merger-related expenses.
Interest
Interest charges for the three months ended March 31, 1997, increased
$1 million versus the prior-year period, primarily due to increased debt
outstanding.
Allowance for Funds Used During Construction (AFC)
- --------------------------------------------------
Variations in AFC track construction work in progress and changes were
not significant for the reporting periods. During the 12-month periods ended
March 31, 1997 and 1996, AFC rates averaged 8.9 percent and 9.2 percent,
respectively.
Balance Sheet
- -------------
The $40 million decrease in accounts receivable and unbilled revenues
is due primarily to lower revenues in February and March 1997 compared to
November and December 1996.
Changes in accounts payable, income taxes accrued and other tax
accruals result from the timing of various payments to taxing authorities and
suppliers.
The $38 million decrease in other current and accrued liabilities at
March 31, 1997, compared to December 31, 1996, is primarily due to the payment
of the $47 million credit to Missouri customers, recorded in 1996, during the
first quarter of 1997.
LIQUIDITY AND CAPITAL RESOURCES
Cash provided by the registrant's operations totaled $66 million for
the three months ended March 31, 1997, compared to $120 million during the same
1996 period.
Cash flows used in investing activities totaled $73 million and $98
million for the three months ended March 31, 1997 and 1996, respectively.
Construction expenditures for the three months ended March 31, 1997, were for
constructing new or improving existing facilities, purchasing railroad coal
cars and complying with the Clean Air Act. In addition, the registrant
expended $4 million for the acquisition of nuclear fuel. Capital requirements
for the remainder of 1997 are expected to be principally for construction
expenditures and the acquisition of nuclear fuel.
<PAGE> 10
Page 9
UNION ELECTRIC COMPANY
----------------------
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF THE RESULTS OF OPERATIONS (Continued)
Cash flows provided by financing activities were $17 million for the
three months ended March 31, 1997, compared to $10 million of cash flows used
for financing activities during the same 1996 period. The registrant's
principal financing activities for the three months ended March 31, 1997, were
the issuance of $158 million of long-term debt under a revolving credit
agreement and $22.6 million of short-term debt; the redemption of $40 million
of First Mortgage Bonds and $64 million of preferred stock; and the payment of
dividends. On February 14, 1997, the registrant's Board of Directors declared
a quarterly dividend of 63.5 cents per common share which was paid to
shareholders March 31, 1997. Common stock dividends paid for the 12 months
ended March 31, 1997, resulted in a pay out rate of 91 percent of the
registrant's earnings to common shareholders. Dividends paid to registrant's
common shareholders relative to net cash provided by operating activities for
the same period were 47 percent.
The registrant plans to utilize short-term debt as support for normal
operations and other temporary requirements. The registrant is authorized by
the FERC to have outstanding at any one time up to $600 million of short-term
unsecured debt instruments. Short-term borrowings of the registrant consist of
bank loans (maturities generally on an overnight basis) and commercial paper
(maturities generally within 10-45 days). At March 31, 1997, the registrant
had committed banks lines of credit aggregating $179 million (of which $145
million was unused 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. These lines of credit are renewable annually at various
dates throughout the year. The registrant also has bank credit agreements due
1999 which permit the registrant to borrow up to $300 million and $200 million,
respectively, on a long-term basis. At March 31, 1997, $158 million of such
borrowings were outstanding.
Additionally, the registrant has a lease agreement which provides for
the financing of nuclear fuel. At March 31, 1997, the maximum amount which
could be financed under the agreement was $120 million. Cash provided from
financing for the three months ended March 31, 1997, included issuances for
nuclear fuel of $12 million offset by $5 million of redemptions. At March 31,
1997, $113 million was financed under the lease.
RATE MATTERS
See Notes 4 and 5 under Notes to Financial Statements of this report.
ACCOUNTING MATTERS
In February 1997 the Financial Accounting Standards Board issued SFAS
No. 128, "Earnings per Share" (FAS 128). This statement establishes standards
for computing and presenting earnings per share. FAS 128 is effective for
financial statements issued for periods ending after December 15, 1997, and is
not expected to have a material effect on the registrant's financial position
or results of operations upon adoption.
SAFE HARBOR STATEMENT
Statements made in this report 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
and financial performance. In connection with the "Safe Harbor" provisions of
the Private Securities Litigation Reform Act of 1995, the Company is providing
the following cautionary statement to identify important factors that could
cause actual results to differ materially from those anticipated. Factors
include, but are not limited to, the effects of: regulatory actions; changes
in laws and other governmental actions; competition; business and economic
conditions; weather conditions; fuel prices and availability; generation plant
performance; monetary and fiscal policies; and legal and administrative
proceedings.
<PAGE> 11
Page 10
PART II. OTHER INFORMATION
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
---------------------------------------------------
At the annual meeting of stockholders of the registrant held on
April 22, 1997, the following matters were presented to the meeting for a vote
and the results of such voting are as follows:
Item (1) Election of Directors.
<TABLE>
<CAPTION>
Non-Voted
Name For(1) Withheld Brokers(2)
---- ---- -------- ---------
<S> <C> <C> <C>
William E. Cornelius . . . . . . . . . . . 87,585,361 1,596,902 0
Thomas A. Hays . . . . . . . . . . . . . . 87,601,395 1,531,601 0
Thomas H. Jacobsen . . . . . . . . . . . . 87,590,086 1,533,502 0
Richard A. Liddy . . . . . . . . . . . . . 87,515,036 1,587,397 0
John Peters MacCarthy . . . . . . . . . . . 87,549,707 1,565,085 0
Paul L. Miller, Jr. . . . . . . . . . . . . 87,538,833 1,577,167 0
Charles W. Mueller . . . . . . . . . . . . 87,586,424 1,542,427 0
Robert H. Quenon . . . . . . . . . . . . . 87,411,296 1,650,573 0
Harvey Saligman . . . . . . . . . . . . . . 87,394,079 1,688,427 0
Janet McAfee Weakley . . . . . . . . . . . 87,468,796 1,692,149 0
</TABLE>
Item (2) Stockholder Proposal re Report on Callaway Plant Decommissioning
Cost.
<TABLE>
<CAPTION>
Non-Voted
For Against Abstain Brokers(2)
--- ------- ------- --------
<S> <C> <C> <C>
7,162,017 65,578,947 3,273,864 12,695,419
</TABLE>
(1) Reflects effect of cumulative voting.
(2) Broker shares included in the quorum but not voting on the items.
ITEM 5. OTHER INFORMATION
-----------------
UNAUDITED PRO FORMA FINANCIAL INFORMATION
AMEREN CORPORATION
On August 11, 1995, the registrant and CIPSCO Incorporated
("CIPSCO") entered into an Agreement and Plan of Merger, which was subsequently
approved by the shareholders of both parties. The merger ("Merger") is further
conditioned on, among other things, receipt of regulatory and governmental
approvals, and will result in a newly formed holding company, Ameren
Corporation. The following unaudited pro forma financial information combines
the historical balance sheets and statements of income of the registrant and
CIPSCO, including their respective subsidiaries, after giving effect to the
Merger. The unaudited pro forma combined condensed balance sheet at March 31,
1997, gives effect to the Merger as if it had occurred at March 31, 1997. The
unaudited pro forma combined condensed statements of income for the three-
month periods ended March 31, 1997 and 1996, and the 12-month period ended
March 31, 1997, give effect to the Merger as if it had occurred at the
beginning of the periods presented. These statements are prepared on the basis
of accounting for the Merger as a pooling of interests and are based on the
assumptions set forth in the notes thereto. In addition, the pro forma
financial information does not give effect to the expected synergies of the
transaction.
The following pro forma financial information has been prepared
from, and should be read in conjunction with, the historical financial
statements and related notes thereto of the registrant and CIPSCO. The
following information is not necessarily indicative of the financial position
or operating results that would have occurred had the Merger been consummated
on the date, or at the beginning of the periods, for which the Merger is being
given effect nor is it necessarily indicative of future operating results or
financial position. In addition, due to the effect of weather on sales and
other factors which are characteristic of public utility operations, financial
results for the three-month periods ended March 31, 1997 and 1996, are not
necessarily indicative of trends for any 12-month period.
Also see Part I, Note 5, Notes to Financial Statements.
<PAGE> 12
Page 11
AMEREN CORPORATION
------------------
UNAUDITED PRO FORMA COMBINED CONDENSED
--------------------------------------
BALANCE SHEET
-------------
AT MARCH 31, 1997
-----------------
(Thousands of Dollars)
<TABLE>
<CAPTION>
ASSETS: As Reported (Note 1) Pro Forma
- ------- ------------------------- Adjustments Pro Forma
Property and plant UE CIPSCO (Notes 2,8) Combined
----- ------ ----------- ---------
<S> <C> <C> <C> <C>
Electric $8,701,243 $2,259,660 $ 376,802 $11,337,705
Gas 188,075 244,269 - 432,344
Other 35,971 - - 35,971
---------- ---------- ---------- -----------
8,925,289 2,503,929 376,802 11,806,020
Less accumulated depreciation and amortization 3,715,215 1,107,047 272,373 5,094,635
---------- ---------- ---------- -----------
5,210,074 1,396,882 104,429 6,711,385
Construction work in progress:
Nuclear fuel in process 99,928 - - 99,928
Other 80,725 58,506 1,736 140,967
---------- ---------- ---------- -----------
Total property and plant, net 5,390,727 1,455,388 106,165 6,952,280
Regulatory assets:
Deferred income taxes (Note 5) 674,547 40,497 - 715,044
Other 175,095 134,380 - 309,475
---------- ---------- ---------- -----------
Total regulatory assets 849,642 174,877 - 1,024,519
Other assets:
Unamortized debt expense 10,446 3,073 575 14,094
Nuclear decommissioning trust fund 100,366 - - 100,366
Investments in nonregulated activities - 115,830 - 115,830
Other 29,126 26,670 (3,269) 52,527
---------- ---------- ---------- -----------
Total other assets 139,938 145,573 (2,694) 282,817
Current assets:
Cash and temporary investments 14,010 7,649 18,651 40,310
Accounts receivable, net 183,233 69,952 20,472 273,657
Unbilled revenue 45,862 21,320 - 67,182
Materials and supplies, at average cost -
Fossil fuel 53,938 34,998 4,878 93,814
Other 95,992 39,177 4,572 139,741
Other 42,647 21,303 3,677 67,627
---------- ---------- ---------- -----------
Total current assets 435,682 194,399 52,250 682,331
---------- ---------- ---------- -----------
Total Assets $6,815,989 $1,970,237 $ 155,721 $ 8,941,947
========== ========== ========== ===========
CAPITAL AND LIABILITIES:
- ------------------------
Capitalization:
Common stock (Note 2) $ 510,619 $ 356,812 $ (866,059) $ 1,372
Other stockholders' equity (Note 2) 1,807,969 302,592 866,059 2,976,620
---------- ---------- ---------- -----------
Total common stockholders' equity 2,318,588 659,404 - 2,977,992
Preferred stock of subsidiary 155,197 80,000 - 235,197
Long-term debt, net 1,960,449 493,303 115,556 2,569,308
---------- ---------- ---------- -----------
Total capitalization 4,434,234 1,232,707 115,556 5,782,497
Minority interest in consolidated subsidiary - - 3,534 3,534
Accumulated deferred income taxes 1,317,792 341,792 (6,695) 1,652,889
Accumulated deferred investment tax credits 158,799 48,052 - 206,851
Regulatory liability 196,590 101,189 - 297,779
Accumulated provision for nuclear decommissioning 102,039 - - 102,039
Other deferred credits and liabilities 158,119 37,564 4,945 200,628
Current liabilities:
Current maturity of long-term debt 37,631 58,000 14,444 110,075
Short-term debt 33,900 41,025 - 74,925
Accounts payable 69,169 49,116 18,296 136,581
Wages payable 35,323 11,485 - 46,808
Taxes accrued 131,369 23,503 - 154,872
Interest accrued 55,254 9,202 2,852 67,308
Other 85,770 16,602 2,789 105,161
---------- ---------- ---------- -----------
Total current liabilities 448,416 208,933 38,381 695,730
---------- ---------- ---------- -----------
Total Capital and Liabilities $6,815,989 $1,970,237 $ 155,721 $ 8,941,947
========== ========== ========== ===========
</TABLE>
See accompanying Notes to Unaudited Pro Forma Combined Condensed Financial
Statements.
<PAGE> 13
Page 12
AMEREN CORPORATION
------------------
UNAUDITED PRO FORMA COMBINED CONDENSED
--------------------------------------
STATEMENTS OF INCOME
--------------------
THREE MONTHS ENDED MARCH 31, 1997
---------------------------------
(Thousands of Dollars Except Shares and Per Share Amounts)
<TABLE>
<CAPTION>
UE CIPSCO
-- ------ Pro Forma
(As Reported) (As Reported) Adjustments Pro Forma
(Notes 1,3,9) (Notes 1,3) (Notes 2,8) Combined
------------- ------------- ----------- ---------
<S> <C> <C> <C> <C>
OPERATING REVENUES:
Electric $ 440,967 $ 160,862 $ 48,269 $ 650,098
Gas 46,110 61,138 - 107,248
Other 181 3,343 108 3,632
------------ ----------- ----------- -----------
Total operating revenues 487,258 225,343 48,377 760,978
OPERATING EXPENSES:
Operations
Fuel and purchased power 116,191 57,613 28,836 202,640
Gas costs 27,508 40,330 - 67,838
Other 95,478 39,902 4,352 139,732
------------ ----------- ----------- -----------
239,177 137,845 33,188 410,210
Maintenance 49,198 14,871 3,470 67,539
Depreciation and amortization 61,444 22,610 3,773 87,827
Income taxes (Note 6) 21,335 9,476 2,033 32,844
Other taxes 50,517 16,068 512 67,097
------------ ----------- ----------- -----------
Total operating expenses 421,671 200,870 42,976 665,517
OPERATING INCOME 65,587 24,473 5,401 95,461
OTHER INCOME AND DEDUCTIONS:
Allowance for equity funds used during
construction 877 217 - 1,094
Minority interest in consolidated subsidiary - - (1,248) (1,248)
Miscellaneous, net (1,081) (71) (1,692) (2,844)
------------ ------------ ----------- -----------
Total other income and deductions, net (204) 146 (2,940) (2,998)
INCOME BEFORE INTEREST CHARGES
AND PREFERRED DIVIDENDS 65,383 24,619 2,461 92,463
INTEREST CHARGES AND PREFERRED DIVIDENDS:
Interest 35,180 8,430 2,461 46,071
Allowance for borrowed funds used during
construction (1,427) (275) - (1,702)
Preferred dividends of subsidiaries (Note 7) 2,204 913 - 3,117
------------ ----------- ----------- -----------
Net interest charges and preferred dividends 35,957 9,068 2,461 47,486
NET INCOME $ 29,426 $ 15,551 $ - $ 44,977
============ =========== =========== ===========
EARNINGS PER SHARE OF COMMON STOCK
(BASED ON AVERAGE SHARES OUTSTANDING) $ 0.29 $ 0.46 $ 0.33
============ =========== ===========
AVERAGE COMMON SHARES OUTSTANDING (Note 2) 102,123,834 34,069,542 1,022,086 137,215,462
============ =========== ========== ===========
</TABLE>
See accompanying Notes to Unaudited Pro Forma Combined Condensed Financial
Statements.
<PAGE> 14
Page 13
AMEREN CORPORATION
------------------
UNAUDITED PRO FORMA COMBINED CONDENSED
--------------------------------------
STATEMENTS OF INCOME
--------------------
THREE MONTHS ENDED MARCH 31, 1996
---------------------------------
(Thousands of Dollars Except Shares and Per Share Amounts)
<TABLE>
<CAPTION>
UE CIPSCO
-- ------ Pro Forma
(As Reported) (As Reported) Adjustments Pro Forma
(Notes 1,3,9) (Notes 1,3) (Notes 2,8) Combined
------------- ------------ ----------- ----------
<S> <C> <C> <C> <C>
OPERATING REVENUES:
Electric $ 450,865 $ 171,288 $ 44,975 $ 667,128
Gas 44,548 64,418 - 108,966
Other 157 2,173 104 2,434
------------ ---------- ----------- ----------
Total operating revenues 495,570 237,879 45,079 778,528
OPERATING EXPENSES:
Operations
Fuel and purchased power 124,264 69,269 24,876 218,409
Gas costs 24,325 41,197 - 65,522
Other 89,804 34,635 4,431 128,870
------------ ---------- ----------- ----------
238,393 145,101 29,307 412,801
Maintenance 48,634 11,436 3,815 63,885
Depreciation and amortization 59,585 20,913 3,776 84,274
Income taxes (Note 6) 28,221 13,460 1,946 43,627
Other taxes 50,983 16,013 552 67,548
------------ ---------- ----------- ----------
Total operating expenses 425,816 206,923 39,396 672,135
OPERATING INCOME 69,754 30,956 5,683 106,393
OTHER INCOME AND DEDUCTIONS:
Allowance for equity funds used during
construction 1,702 11 - 1,713
Minority interest in consolidated subsidiary - - (1,192) (1,192)
Miscellaneous, net 895 (203) (1,851) (1,159)
------------ ---------- ----------- ----------
Total other income and deductions, net 2,597 (192) (3,043) (638)
INCOME BEFORE INTEREST CHARGES
AND PREFERRED DIVIDENDS 72,351 30,764 2,640 105,755
INTEREST CHARGES AND PREFERRED DIVIDENDS:
Interest 33,858 8,722 2,640 45,220
Allowance for borrowed funds used during
construction (1,647) (15) - (1,662)
Preferred dividends of subsidiaries (Note 7) 3,312 939 - 4,251
------------ ---------- ----------- ----------
Net interest charges and preferred dividends 35,523 9,646 2,640 47,809
NET INCOME $ 36,828 $ 21,118 $ - $ 57,946
============ ========== =========== ==========
EARNINGS PER SHARE OF COMMON STOCK
(BASED ON AVERAGE SHARES OUTSTANDING) $ 0.36 $ 0.62 $ 0.42
============ ========== ==========
AVERAGE COMMON SHARES OUTSTANDING (Note 2) 102,123,834 34,069,542 1,022,086 137,215,462
============ ========== =========== ===========
</TABLE>
See accompanying Notes to Unaudited Pro Forma Combined Condensed Financial
Statements.
<PAGE> 15
Page 14
AMEREN CORPORATION
------------------
UNAUDITED PRO FORMA COMBINED CONDENSED
--------------------------------------
STATEMENTS OF INCOME
--------------------
TWELVE MONTHS ENDED MARCH 31, 1997
----------------------------------
(Thousands of Dollars Except Shares and Per Share Amounts)
<TABLE>
<CAPTION>
UE CIPSCO
-- ------ Pro Forma
(As Reported) (As Reported) Adjustments Pro Forma
(Notes 1,3,9) (Notes 1,3) (Notes 2,8) Combined
------------ ----------- ----------- ---------
<S> <C> <C> <C> <C>
OPERATING REVENUES:
Electric $2,150,917 $ 720,386 $ 178,820 $3,050,123
Gas 100,626 152,068 - 252,694
Other 509 11,724 1,110 13,343
---------- ---------- ---------- ----------
Total operating revenues 2,252,052 884,178 179,930 3,316,160
OPERATING EXPENSES:
Operations
Fuel and purchased power 504,758 262,558 97,207 864,523
Gas costs 67,731 95,360 - 163,091
Other 384,781 151,855 18,225 554,861
---------- ---------- ---------- ----------
957,270 509,773 115,432 1,582,475
Maintenance 224,195 64,896 16,765 305,856
Depreciation and amortization 243,158 89,094 15,663 347,915
Income taxes (Note 6) 190,483 45,574 8,320 244,377
Other taxes 212,799 57,873 1,738 272,410
---------- ---------- ---------- ----------
Total operating expenses 1,827,905 767,210 157,918 2,753,033
OPERATING INCOME 424,147 116,968 22,012 563,127
OTHER INCOME AND DEDUCTIONS:
Allowance for equity funds used during
construction 5,667 584 - 6,251
Minority interest in consolidated subsidiary - - (4,762) (4,762)
Miscellaneous, net (6,269) (2,652) (7,243) (16,164)
---------- ---------- ---------- ----------
Total other income and deductions, net (602) (2,068) (12,005) (14,675)
INCOME BEFORE INTEREST CHARGES
AND PREFERRED DIVIDENDS 423,545 114,900 10,007 548,452
INTEREST CHARGES AND PREFERRED DIVIDENDS:
Interest 133,966 37,460 10,007 181,433
Allowance for borrowed funds used during
construction (6,787) (744) - (7,531)
Preferred dividends of subsidiaries (Note 7) 12,141 3,695 - 15,836
---------- ---------- ----------- ----------
Net interest charges and preferred dividends 139,320 40,411 10,007 189,738
NET INCOME $ 284,225 $ 74,489 $ - $ 358,714
========== ========== =========== ==========
EARNINGS PER SHARE OF COMMON STOCK
(BASED ON AVERAGE SHARES OUTSTANDING) $2.78 $ 2.19 $ 2.61
===== ========== ==========
AVERAGE COMMON SHARES OUTSTANDING (Note 2) 102,123,834 34,069,542 1,022,086 137,215,462
=========== =========== =========== ===========
</TABLE>
See accompanying Notes to Unaudited Pro Forma Combined Condensed Financial
Statements.
<PAGE> 16
Page 15
AMEREN CORPORATION
NOTES TO UNAUDITED PRO FORMA COMBINED CONDENSED FINANCIAL STATEMENTS
1. Reclassifications were made to certain "as reported" account balances
reflected in the registrant's and CIPSCO's financial statements to
conform to this reporting presentation (See Notes 5, 6 and 7). All
other financial statement presentation and accounting policy
differences were immaterial and were not adjusted in the pro forma
combined condensed financial statements.
2. The pro forma combined condensed financial statements reflect the
conversion of each share of the registrant's Common Stock ($5 par
value) outstanding into one share of Ameren Common Stock ($.01 par
value) and the conversion of each share of CIPSCO Common Stock (no par
value) outstanding into 1.03 shares of Ameren Common Stock, as provided
in the Merger Agreement. The pro forma combined condensed financial
statements are presented as if the companies were combined during all
periods included therein.
3. The allocation between the registrant and CIPSCO and their customers of
the estimated cost savings resulting from the merger, net of the costs
incurred to achieve such savings, will be subject to regulatory review
and approval. Merger-related costs (which include transaction costs
and costs to achieve such savings) are currently estimated to be
approximately $73 million (including costs for financial advisors,
attorneys, accountants, consultants, filings, printing, system
integration, relocation, etc.). None of these estimated cost savings
have been reflected in the pro forma combined condensed financial
statements. However, net income for the three months and 12 months
ended March 31, 1997, included merger-related costs of $2.0 million and
$9.0 million, net of income taxes, for the registrant, and $0.3 million
and $4.6 million, net of income taxes, for CIPSCO, respectively. Net
income for the three months ended March 31, 1996, included
merger-related costs of $0.9 million, net of income taxes, for the
registrant, and $0.7 million, net of income taxes, for CIPSCO.
4. Intercompany transactions (including purchased and exchanged power
transactions) between the registrant and CIPSCO during the periods
presented were not material and, accordingly, no pro forma adjustments
were made to eliminate such transactions.
5. CIPSCO's regulatory asset related to deferred income taxes was
reclassified from the regulatory liability account balance to conform
to this reporting presentation.
6. CIPSCO's income taxes were reflected as operating expenses to conform
to this reporting presentation.
7. Currently, the registrant's Preferred Stock is not issued by a
subsidiary; subsequent to the merger, the registrant's Preferred Stock
will be issued by a subsidiary of Ameren. As a result, the
registrant's preferred dividend requirements were reclassified to
conform to this reporting presentation.
8. Pro forma adjustments were made to consolidate the financial results of
Electric Energy, Inc. (EEI), which will, in substance, be a 60 percent
owned subsidiary of Ameren subsequent to the merger. The registrant
and CIPSCO hold 40 percent and 20 percent ownership interests,
respectively, in EEI and account for these investments under the equity
method of accounting. All intercompany transactions between the
registrant, CIPSCO and EEI were eliminated.
9. Net income for the three and 12 months ended March 31, 1997 included
credits for Missouri electric customers which reduced revenues and
pretax income of the registrant by $12.0 million and $45.8 million,
respectively. Net income for the three months ended March 31, 1996
included a credit to Missouri electric customers which reduced revenues
and pretax income of the registrant by $13.5 million.
<PAGE> 17
Page 16
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
--------------------------------
(a) Exhibits.
Exhibit 12(a) - Computation of Ratio of Earnings to Fixed
Charges, 12 Months Ended March 31, 1997.
Exhibit 12(b) - Computation of Ratio of Earnings to Fixed
Charges and Preferred Stock Dividend
Requirements, 12 Months Ended March 31,
1997.
Exhibit 27 - Financial Data Schedule.
(b) Reports on Form 8-K. None
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.
UNION ELECTRIC COMPANY
(Registrant)
May 13, 1997 By DONALD E. BRANDT
----------------------
Donald E. Brandt
Senior Vice President
Finance and Corporate Services
<PAGE> 1
EXHIBIT 12(a)
UNION ELECTRIC COMPANY
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
<TABLE>
<CAPTION>
Year Ended December 31, 12 Months
------------------------------------------------------------- Ended
March 31,
1992 1993 1994 1995 1996 1997
---- ---- ---- ---- ---- ----
(Thousands of Dollars Except Ratios)
<S> <C> <C> <C> <C> <C> <C>
Net income for the Period $302,748 $297,160 $320,757 $314,107 $304,876 $296,366
-------- -------- -------- -------- -------- --------
Add:
Taxes Based on income 197,009 182,716 203,827 207,734 196,210 189,991
-------- -------- -------- -------- -------- --------
Fixed Charges:
Interest on Debt 125,798 124,430 135,608 129,239 128,375 130,156 (*)
Amortization of Premium and
Discount, Less Expense on Debt;
and Bond Defeasance Cost 9,521 5,170 5,504 5,502 4,269 3,811
Rentals (See note) 908 1,314 1,299 3,330 3,458 3,716
-------- -------- -------- -------- -------- --------
Total Fixed Charges 136,227 130,914 142,411 138,071 136,102 137,683
-------- -------- -------- -------- -------- --------
Earnings Available for Fixed Charges $635,984 $610,790 $666,995 $659,912 $637,188 $624,040
======== ======== ======== ======== ======== ========
Ratio of Earnings to Fixed Charges 4.66 4.66 4.68 4.78 4.68 4.53
==== ==== ==== ==== ==== ====
</TABLE>
(*) Total annual interest charges on all bonds for the twelve months ended
March 31, 1997 was $112,905,000.
Note: Represents the interest factor applicable to rentals.
<PAGE> 1
EXHIBIT 12(b)
UNION ELECTRIC COMPANY
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
AND
PREFERRED STOCK DIVIDEND REQUIREMENTS
<TABLE>
<CAPTION>
Year Ended December 31, 12 Months
------------------------------------------------------------- Ended
March 31,
1992 1993 1994 1995 1996 1997
---- ---- ---- ---- ---- ----
(Thousands of Dollars Except Ratios)
<S> <C> <C> <C> <C> <C> <C>
Net income for the period $302,748 $297,160 $320,757 $314,107 $304,876 $296,366
Add:
Taxes based on income 197,009 182,716 203,827 207,734 196,210 189,991
Fixed charges (see below) 136,227 130,914 142,411 138,071 136,102 137,683
------- -------- -------- -------- -------- --------
Earnings available for fixed charges
and preferred stock dividend
requirements of Registrant $635,984 $610,790 $666,995 $659,912 $637,188 $624,040
======== ======== ======== ======== ======== ========
Fixed charges:
Interest on debt $125,798 $124,430 $135,608 $129,239 $128,375 $130,156
Amortization of premium and discount,
less expense, on debt; and
bond defeasance cost 9,521 5,170 5,504 5,502 4,269 3,811
Rentals (see note) 908 1,314 1,299 3,330 3,458 3,716
------ ---------- -------- -------- -------- --------
Total fixed charges $136,227 $130,914 $142,411 $138,071 $136,102 $137,683
Preferred stock dividend requirements
of Registrant* (Adjusted for income
tax effect) 21,852 21,537 20,514 20,808 20,612 18,759
-------- -------- -------- -------- -------- --------
Total fixed charges and preferred
stock dividend requirements $158,079 $152,451 $162,925 $158,879 $156,714 $156,442
======== ======== ======== ======== ======== ========
Ratio of earnings to fixed charges
and preferred dividends 4.02 4.01 4.09 4.15 4.06 3.98
==== ==== ==== ==== ==== ====
</TABLE>
Note: Represents the interest factor applicable to rentals.
* See following page for supporting computation.
<PAGE> 2
EXHIBIT 12(b)
(continued)
UNION ELECTRIC COMPANY
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
AND
PREFERRED STOCK DIVIDEND REQUIREMENTS
<TABLE>
<CAPTION>
Year Ended December 31, 12 Months
------------------------------------------------------------- Ended
March 31,
1992 1993 1994 1995 1996 1997
---- ---- ---- ---- ---- ----
(Thousands of Dollars Except Ratios)
<S> <C> <C> <C> <C> <C> <C>
Computation of preferred stock
dividend requirements of Registrant,
adjusted for income tax effect*
Preferred stock dividend
requirements of Registrant, as
shown on statement of earnings $14,058 $14,087 $13,252 $13,250 $13,249 $12,141
Less deductible preferred stock
dividends** 2,085 1,973 1,816 1,816 1,816 1,816
------- ------- ------- ------- ------- -------
Non-deductible preferred stock
dividends $11,973 $12,114 $11,436 $11,434 $11,433 $10,325
======= ======= ======= ======= ======= =======
Excess of net income before income
taxes over net income (percentage)
See note below 65.1% 61.5% 63.5% 66.1% 64.4% 64.1%
----- ----- ----- ----- ----- -----
Income tax effect on non-deductible
preferred stock dividends* $7,794 $7,450 $7,262 $7,558 $7,363 $6,618
Add:
Deductible preferred stock
dividends (above) 2,085 1,973 1,816 1,816 1,816 1,816
Non-deductible preferred stock
dividends (above) 11,973 12,114 11,436 11,434 11,433 10,325
------ ------ ------ ------ ------ ------
Preferred stock dividend requirements
of Registrant. (Adjusted for income
tax effect) $21,852 $21,537 $20,514 $20,808 $20,612 $18,759
======= ======= ======= ======= ======= =======
Note: Calculated as follows -
Net income before income taxes $499,757 $479,876 $524,584 $521,841 $501,086 $486,357
Less net income 302,748 297,160 320,757 314,107 304,876 296,366
-------- -------- -------- -------- -------- --------
Excess - Taxed based on income $197,009 $182,716 $203,827 $207,734 $196,210 $189,991
======== ======== ======== ======== ======== ========
- Percentage of net income 65.1% 61.5% 63.5% 66.1% 64.4% 64.1%
===== ===== ===== ===== ===== =====
</TABLE>
* Income tax adjustment to reflect pretax earnings required to meet preferred
stock dividend.
** Dividends deductible on federal income tax return.
<TABLE> <S> <C>
<ARTICLE> UT
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1997
<PERIOD-END> MAR-31-1997
<BOOK-VALUE> PER-BOOK
<TOTAL-NET-UTILITY-PLANT> 5,390,727
<OTHER-PROPERTY-AND-INVEST> 100,366
<TOTAL-CURRENT-ASSETS> 435,682
<TOTAL-DEFERRED-CHARGES> 39,572
<OTHER-ASSETS> 849,642
<TOTAL-ASSETS> 6,815,989
<COMMON> 510,619
<CAPITAL-SURPLUS-PAID-IN> 716,879
<RETAINED-EARNINGS> 1,091,090
<TOTAL-COMMON-STOCKHOLDERS-EQ> 2,318,588
0
155,197
<LONG-TERM-DEBT-NET> 1,879,651
<SHORT-TERM-NOTES> 33,900
<LONG-TERM-NOTES-PAYABLE> 0
<COMMERCIAL-PAPER-OBLIGATIONS> 0
<LONG-TERM-DEBT-CURRENT-PORT> 5,000
0
<CAPITAL-LEASE-OBLIGATIONS> 80,798
<LEASES-CURRENT> 32,631
<OTHER-ITEMS-CAPITAL-AND-LIAB> 2,310,224
<TOT-CAPITALIZATION-AND-LIAB> 6,815,989
<GROSS-OPERATING-REVENUE> 487,258
<INCOME-TAX-EXPENSE> 21,335
<OTHER-OPERATING-EXPENSES> 400,336
<TOTAL-OPERATING-EXPENSES> 421,671
<OPERATING-INCOME-LOSS> 65,587
<OTHER-INCOME-NET> (204)
<INCOME-BEFORE-INTEREST-EXPEN> 65,383
<TOTAL-INTEREST-EXPENSE> 33,753
<NET-INCOME> 31,630
2,204
<EARNINGS-AVAILABLE-FOR-COMM> 29,426
<COMMON-STOCK-DIVIDENDS> 64,849
<TOTAL-INTEREST-ON-BONDS> 112,905
<CASH-FLOW-OPERATIONS> 65,555
<EPS-PRIMARY> 0.29
<EPS-DILUTED> 0.29
</TABLE>
