<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 10-Q
(Mark One)
/ X / QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarter ended December 31, 1995
----------------------------------------------------------
OR
/ / 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 1-1483
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WASHINGTON GAS LIGHT COMPANY
- -------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
District of Columbia and Virginia 53-0162882
- -------------------------------------------- -----------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1100 H Street, N. W., Washington, D. C. 20080
- ---------------------------------------- -----------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (703) 750-4440
-----------------------
NONE
- -------------------------------------------------------------------------------
(Former name, former address and former fiscal year, if changed since last
report.)
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
------ -----
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
Common Stock $1.00 par value 43,259,873 January 31, 1996
- ---------------------------- --------------------- ------------------
Class Number of Shares Date
<PAGE> 2
WASHINGTON GAS LIGHT COMPANY
INDEX
<TABLE>
<CAPTION>
Page No.
--------
<S> <C> <C>
PART I. Financial Information:
Item 1. Financial Statements
Consolidated Balance Sheet -
December 31, 1995 and September 30, 1995................. 2
Consolidated Statement of Income -
Three Months Ended December 31, 1995 and 1994............ 3
Consolidated Statement of Cash Flows -
Three Months Ended December 31, 1995 and 1994............ 4
Notes to Consolidated Financial Statements................. 5
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations............... 6-7
PART II. Other Information:
Item 5. Other Information................................... 8-9
Item 6. Exhibits and Reports on Form 8-K.................... 10
Signatures................................................... 10
</TABLE>
1
<PAGE> 3
WASHINGTON GAS LIGHT COMPANY
CONSOLIDATED BALANCE SHEET
(Unaudited)
<TABLE>
<CAPTION>
Dec. 31, Sept. 30,
1995 1995
------------ ------------
(Thousands)
<S> <C> <C>
ASSETS
PROPERTY, PLANT AND EQUIPMENT
At original cost . . . . . . . . . . . . . . . . . . . . . . . . . $ 1,628,022 $ 1,608,518
Accumulated depreciation and amortization . . . . . . . . . . . . (562,552) (552,460)
------------ ------------
1,065,470 1,056,058
------------ ------------
CURRENT ASSETS
Cash and cash equivalents . . . . . . . . . . . . . . . . . . . . 8,807 13,911
Accounts receivable, less reserve . . . . . . . . . . . . . . . . 167,024 49,963
Inventories and storage gas purchased . . . . . . . . . . . . . . 54,963 67,657
Deferred income taxes . . . . . . . . . . . . . . . . . . . . . . 19,016 19,710
Other prepayments, principally taxes . . . . . . . . . . . . . . . 10,596 7,799
------------ ------------
260,406 159,040
------------ ------------
DEFERRED CHARGES AND OTHER ASSETS . . . . . . . . . . . . . . . . . . 120,809 145,040
------------ ------------
TOTAL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 1,446,685 $ 1,360,138
============ ============
CAPITALIZATION AND LIABILITIES
CAPITALIZATION
Common shareholders' equity . . . . . . . . . . . . . . . . . . . $ 543,389 $ 513,044
Preferred stock . . . . . . . . . . . . . . . . . . . . . . . . . 28,471 28,471
Long-term debt . . . . . . . . . . . . . . . . . . . . . . . . . . 379,063 329,051
------------ ------------
950,923 870,566
------------ ------------
CURRENT LIABILITIES
Current maturities of long-term debt . . . . . . . . . . . . . . . 6 52,505
Notes payable . . . . . . . . . . . . . . . . . . . . . . . . . . 37,423 -
Accounts and wages payable . . . . . . . . . . . . . . . . . . . . 104,854 80,523
Customer deposits and advance payments . . . . . . . . . . . . . . 15,051 15,408
Accrued taxes and interest . . . . . . . . . . . . . . . . . . . . 40,857 11,830
Other current liabilities . . . . . . . . . . . . . . . . . . . . 51,880 62,090
------------ ------------
250,071 222,356
------------ ------------
DEFERRED CREDITS . . . . . . . . . . . . . . . . . . . . . . . . . . 245,691 267,216
------------ ------------
TOTAL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 1,446,685 $ 1,360,138
============ ============
</TABLE>
See accompanying Notes to Consolidated Financial Statements.
2
<PAGE> 4
WASHINGTON GAS LIGHT COMPANY
CONSOLIDATED STATEMENT OF INCOME
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended
--------------------------------------
Dec. 31, 1995 Dec. 31, 1994
------------- -------------
(Thousands, Except Per Share Data)
<S> <C> <C>
OPERATING REVENUES . . . . . . . . . . . . . . . . . . . . . . . . . $ 274,326 $ 242,915
Cost of Gas . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 122,904 116,118
------------ -----------
NET REVENUES . . . . . . . . . . . . . . . . . . . . . . . . . . . . 151,422 126,797
------------ -----------
OTHER OPERATING EXPENSES
Operation . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44,946 41,609
Maintenance . . . . . . . . . . . . . . . . . . . . . . . . . . . 7,817 7,849
Depreciation and amortization . . . . . . . . . . . . . . . . . . 11,873 11,406
General taxes . . . . . . . . . . . . . . . . . . . . . . . . . . 16,473 17,146
Income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . 23,292 15,398
------------ -----------
104,401 93,408
------------ -----------
OPERATING INCOME . . . . . . . . . . . . . . . . . . . . . . . . . . 47,021 33,389
Other Income (Loss)- Net . . . . . . . . . . . . . . . . . . . . . . (851) 2,461
------------ -----------
INCOME BEFORE INTEREST EXPENSE . . . . . . . . . . . . . . . . . . . 46,170 35,850
Interest Expense . . . . . . . . . . . . . . . . . . . . . . . . . . 7,830 8,124
------------ -----------
NET INCOME . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38,340 27,726
Dividends on Preferred Stock . . . . . . . . . . . . . . . . . . . . 333 333
------------ -----------
NET INCOME APPLICABLE TO COMMON STOCK . . . . . . . . . . . . . . . . $ 38,007 $ 27,393
============ ===========
AVERAGE COMMON SHARES OUTSTANDING . . . . . . . . . . . . . . . . . .
(See Note B to the Consolidated Financial
Statements) . . . . . . . . . . . . . . . . . . . . . . . . . . . 43,051 42,285
EARNINGS PER AVERAGE SHARE OF COMMON STOCK
(See Exhibit 11 for computation of fully
diluted earnings per average share and Note
B to the Consolidated Financial Statements) . . . . . . . . . . . $ .88 $ .65
============ ===========
DIVIDENDS DECLARED PER COMMON SHARE (See Note
B to the Consolidated Financial Statements) . . . . . . . . . . . $ .28 $ .2775
============ ===========
</TABLE>
See accompanying Notes to Consolidated Financial Statements.
3
<PAGE> 5
WASHINGTON GAS LIGHT COMPANY
CONSOLIDATED STATEMENT OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended
--------------------------------------
Dec. 31, 1995 Dec. 31, 1994
------------- -------------
(Thousands)
<S> <C> <C>
OPERATING ACTIVITIES
Net Income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 38,340 $ 27,726
Adjustments to reconcile net income to net cash
used in operating activities:
Depreciation and amortization (a) . . . . . . . . . . . . . . . 13,398 12,753
Deferred income taxes-net . . . . . . . . . . . . . . . . . . . 2,819 (1,904)
Amortization of investment tax credits . . . . . . . . . . . . (247) (252)
Allowance for funds used during construction . . . . . . . . . (190) (245)
Other noncash charges and credits-net . . . . . . . . . . . . . 2,319 1,079
----------- -----------
56,439 39,157
Changes in assets and liabilities:
Accounts receivable and accrued utility
revenues . . . . . . . . . . . . . . . . . . . . . . . . . . (117,806) (94,598)
Storage gas purchased . . . . . . . . . . . . . . . . . . . . . 14,119 9,427
Gas costs due from/to customers . . . . . . . . . . . . . . . . (5,831) 4,054
Other prepayments, principally taxes . . . . . . . . . . . . . (2,797) (2,756)
Materials and supplies . . . . . . . . . . . . . . . . . . . . . (1,425) 414
Accounts and wages payable . . . . . . . . . . . . . . . . . . 23,916 4,621
Customer deposits and advance payments . . . . . . . . . . . . (357) 2,141
Accrued taxes . . . . . . . . . . . . . . . . . . . . . . . . . 22,519 19,438
Accrued interest . . . . . . . . . . . . . . . . . . . . . . . 6,508 5,989
Pipeline refunds due customers . . . . . . . . . . . . . . . . 5,580 (2,639)
Rate refund due customers . . . . . . . . . . . . . . . . . . . (9,306) -
Deferred purchased gas costs . . . . . . . . . . . . . . . . . (2,236) 11,520
Other-net . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,666 2,292
----------- -----------
Net Cash Used in Operating Activities . . . . . . . . . . (9,011) (940)
----------- -----------
FINANCING ACTIVITIES
Common stock issued . . . . . . . . . . . . . . . . . . . . . . . . . 3,074 3,376
Long-term debt retired . . . . . . . . . . . . . . . . . . . . . . . (2,505) (6,328)
Notes payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37,423 41,958
Dividends on common and preferred stock . . . . . . . . . . . . . . . (12,357) (12,046)
----------- -----------
Net Cash Provided by Financing Activities . . . . . . . . 25,635 26,960
----------- -----------
INVESTING ACTIVITIES
Proceeds from sale of non-utility subsidiary . . . . . . . . . . . . - 2,000
Capital expenditures . . . . . . . . . . . . . . . . . . . . . . . . (21,728) (27,258)
----------- -----------
Net Cash Used in Investing Activities . . . . . . . . . . (21,728) (25,258)
----------- -----------
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS . . . . . . . . . . (5,104) 762
Cash and Cash Equivalents at Beginning of Period . . . . . . . . . . 13,911 3,522
----------- -----------
CASH AND CASH EQUIVALENTS AT END OF PERIOD . . . . . . . . . . . . . $ 8,807 $ 4,284
=========== ===========
(a) Includes amounts charged to other accounts.
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
Income taxes paid . . . . . . . . . . . . . . . . . . . . . . . . $ 833 $ 1,194
Interest paid . . . . . . . . . . . . . . . . . . . . . . . . . . $ 1,204 $ 2,018
</TABLE>
See accompanying Notes to Consolidated Financial Statements.
4
<PAGE> 6
WASHINGTON GAS LIGHT COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
A. In the opinion of the Company, the accompanying consolidated financial
statements reflect all adjustments (which include only normal recurring
adjustments) necessary to present fairly the results for such periods.
Reference is hereby made to the Company's Annual Report on Form 10-K for
the fiscal year ended September 30, 1995.
B. On May 1, 1995, additional shares of common stock were distributed to
shareholders of record on April 20, 1995, in connection with a two-for-one
stock split. All share disclosures and per share calculations included in
this report are on a post-split basis.
C. Due to the seasonal nature of the Company's business, the results of
operations shown are not indicative of the results to be expected for the
fiscal year ended September 30, 1996.
D. At September 30, 1995, the Company had outstanding $50 million of 7-7/8%
Series First Mortgage Bonds due September 1, 2016 and $17.325 million of
9-1/4% Series First Mortgage Bonds due April 15, 2018. Each of these
series has a 30-year nominal life, and each allows the holder to elect
early maturity of the bonds, at par, on the tenth anniversary of the
issuance date. Additionally, the Company may redeem the bonds at par at
any time on or after the tenth anniversary date of their issuance up until
the end of the 30-year nominal life.
On January 25, 1996, the Company issued $50 million of unsecured
Medium-Term Notes (MTNs) at a coupon rate of 6.15% and $21.6 million
of short-term commercial paper. The new MTNs carry the same terms as
the First Mortgage Bonds discussed in the prior paragraph. The
proceeds of these issuances were used to purchase approximately $71.6
million of U.S. Treasury Securities. These securities were deposited
in an irrevocable trust and the principal and interest on these
securities will be used to pay the interest and principal payments on
the outstanding 7-7/8% and 9-1/4% Series First Mortgage Bonds up to
and including their first call dates on September 1, 1996 and April
15, 1998, respectively. The First Mortgage Bonds will be legally
retired on their first call dates with the proceeds from the treasury
securities included in the trust. This transaction was recorded as
an in-substance defeasance in January 1996. A premium of
approximately $2.3 million was recorded as a regulatory asset in
connection with acquiring the treasury securities and this amount
will be amortized over future periods in accordance with prior
regulatory practice.
The $50 million of 7-7/8% Series First Mortgage Bonds have been
classified as long-term debt at December 31, 1995 since they were
refinanced on a long-term basis prior to the issuance of these
financial statements.
5
<PAGE> 7
WASHINGTON GAS LIGHT COMPANY
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
For the three months ended December 31, 1995, net income applicable
to common stock amounted to $38.0 million, which represented an increase of
$10.6 million from the same period in the prior year. Earnings per average
common share were $.88, or $.23 per average common share higher than the
quarter ended December 31, 1994. The improvement was due to greater firm therm
sales resulting from colder weather, additional customer meters served and
higher retail rates in the Company's Maryland jurisdiction. Partially
offsetting these increases were increased operation expenses and lower other
income (loss)-net. Weather was 44.1% colder than the same period last year and
23.8% colder than normal.
Net revenues for the period increased $24.6 million (19.4%) from the
same period last year to $151.4 million. Therm sales to firm customers, as
shown in the table below, rose by 87.3 million therms (29.7%) due primarily to
the colder weather in the current quarter and the impact of a 3.3% increase in
the number of customer meters. A rate increase effective December 1, 1994 in
the Company's Maryland jurisdiction also contributed favorably to net revenues
in the most recent fiscal quarter.
<TABLE>
<CAPTION>
Three Months Ended
------------------
December 31, December 31,
1995 1994
------------ ------------
<S> <C> <C>
Gas Delivered (thousands of therms)
Firm...................................... 380,970 293,673
Interruptible............................. 58,505 73,481
Electric Generation-Interruptible......... 6,574 9,663
Transportation Service.................... 21,906 16,335
---------- -----------
Total................................... 467,955 393,152
========== ===========
Number of Customer Meters (end of period)... 768,252 743,496
========== ===========
Degree Days................................. 1,696 1,177
========== ===========
</TABLE>
Excluding sales for electric generation, therms delivered to
interruptible and transportation service customers declined by 9.4 million
therms (10.5%) resulting in a drop in net revenues. This reflects the
effect of significant interruptions during the first fiscal quarter of 1996
resulting from the colder weather. Margin sharing arrangements in each of the
Company's major jurisdictions minimize the effect on net income of increases or
decreases in sales and deliveries to the interruptible class. Under these
arrangements, a majority of the margins earned on sales and deliveries to these
classes are returned to firm customers after a certain gross margin threshold
is reached or in exchange for the transfer of a portion of the fixed costs from
the interruptible to the firm class.
Operation and maintenance expenses rose by $3.3 million (6.7%)
over the same period last year. The increase primarily reflects the effect of
higher expenses for uncollectible accounts due to the colder weather and a
non-recurring accrual for a contingency.
General taxes declined by $673,000 due to a drop in the fuel tax
rate for service to customers in Montgomery County, Maryland that was only
partially offset by higher other gross receipts taxes due to the colder
weather. All such taxes are included in revenues and therefore fluctuations
in these amounts have no effect on net income.
Other income (loss) - net decreased by $3.3 million, due to a
$1.9 million after-tax gain recorded on the sale of American Environmental
Products, Inc., a non-utility subsidiary, in October 1994 and the establishment
of a valuation reserve for certain non-utility investments in the first quarter
of fiscal year 1996.
6
<PAGE> 8
WASHINGTON GAS LIGHT COMPANY
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
LIQUIDITY AND CAPITAL RESOURCES
Capital expenditures for the first three months of fiscal year 1996
were $21.7 million and are budgeted to be $130.3 million for the year. To fund
construction expenditures and other capital requirements, the Company draws
upon both internal and external sources of cash. The Company's ability to
generate adequate cash internally depends upon a number of factors, including
the timing and amount of rate increases received and the level of therm sales.
The level of therm sales is almost exclusively dependent upon the number of
customer meters and the variability of the weather.
The Company's business is highly weather sensitive and seasonal.
Approximately 75% of the Company's therm sales (excluding sales made for
electric generation) are normally generated in the first and second fiscal
quarters. This seasonality causes short-term cash requirements to vary
significantly during the year. Cash requirements peak in the winter months
when accounts receivable, accrued utility revenues and storage gas costs are at
or near their highest levels. After the winter heating season, these assets
are converted into cash and are used to liquidate short-term debt and acquire
storage gas for the subsequent heating season.
Net cash used in operating activities was $9.0 million during the
first three months of fiscal year 1996, as compared to $.9 million in net cash
used in operating activities for the similar period of fiscal year 1995. The
increase in net cash used results primarily from: (i) higher accounts
receivable balances reflecting higher therm sales due to the colder weather;
(ii) an undercollection of gas costs in the current year compared to an
overcollection in the prior year; and (iii) refunds made to customers for
amounts overcollected from the implementation of interim rates and for
overcollected gas costs during the prior year. These factors more than offset
the combined effect of increased net income, greater use of storage gas
inventories in the current period, and increased accounts payable balances
resulting from greater amounts owed for gas purchases.
The Company uses short-term debt in the form of commercial paper and
short-term bank loans to fund seasonal requirements. Alternative sources
include unsecured lines of credit, some of which are seasonal, and $130 million
in a revolving credit agreement maintained with a group of banks. These
financing options may be activated to support or replace the Company's
commercial paper. Excluding current maturities, the Company had $37.4 million
of short-term debt outstanding at December 31, 1995. These borrowings were
composed of $20.7 million and $16.7 million of commercial paper and bank loans,
respectively, and represent an increase of $37.4 million from the level at
September 30, 1995. This compares to $94.9 million of short-term debt
outstanding at December 31, 1994, an increase of $42.0 million from the level
at September 30, 1994.
The $2.5 million of long-term debt retired during the current quarter
reflects Medium-Term Note maturities.
During the three months ended December 31, 1995, the Company sold
with recourse, $9.1 million of non-utility accounts receivable. This compares
to $12.7 million sold in the three months ended December 31, 1994.
7
<PAGE> 9
PART II. OTHER INFORMATION
Item 5. Other Information
A. As part of a series of steps toward unbundling services in the
District of Columbia, the Company filed proposed tariffs on December 21, 1995,
January 2, 1996, and February 5, 1996 with the Public Service Commission of the
District of Columbia. If approved, the proposals will increase opportunities
for the Company to tailor new services to meet the needs of firm and
interruptible customers and will allow more customers the flexibility to
acquire their gas supplies from the supplier of their choice.
Under the proposed tariffs, interruptible delivery service would be
expanded to customers who use, on an annual basis, more than 60,000 therms of
gas, rather than over 250,000 therms as previously required. The Company also
proposed to reduce the minimum monthly bill for interruptible delivery service.
These changes provide nearly all of the 300 interruptible customers in the
District of Columbia the choice of purchasing their gas supply from a
third-party supplier or purchasing traditional bundled gas sales service from
the Company. The Company would continue to share the margins earned on sales
and deliveries to interruptible customers, with 90% being returned to firm
customers and 10% being retained by the Company.
Under the proposed firm gas sales tariffs, commercial and
group-metered apartment customers in the District of Columbia would see the
price of gas purchased and the price of delivery of the gas to the customer
stated separately on the customer's bill. Although this change will have no
effect on the amount of a customer's bill, it will serve to inform customers of
the prices they pay for the various services they are receiving. The Company
has also proposed to initiate firm delivery service for large commercial and
group-metered apartment customers.
B. Effective January 1, 1996, Frederick Gas Company, Inc., one of the
Company's distribution subsidiaries, merged with the parent company.
C. As previously reported in a report on Form 8-K filed on October 5,
1995, the International Union of Gas Workers (IUGW) appealed the August 28,
1995 decision of the Acting Regional Director of the National Labor Relations
Board (NLRB), which ruled in favor of the Company regarding the Company's
conduct during negotiations with the IUGW. On January 23, 1996, the General
Counsel of the NLRB affirmed the Acting Regional Director's earlier decision
that the Company had bargained in good faith with the IUGW and that the
Company's lockout was legal. Accordingly, the union's claim for back wages to
approximately 1,000 employees during the nearly 16-week lockout has been
extinguished, without any further right of appeal.
The union filed a second round of unfair labor practice charges in
October 1995, alleging that the Company's installation of new employment terms
was illegal because there had been insufficient bargaining and no true impasse.
These charges further alleged that the Company's various offers and
communications with its employees amounted to bypassing the union's authority
as bargaining agent. On February 6, 1996, the Regional Office of the NLRB
notified the Company that it was dismissing this second round of charges
entirely as lacking in merit.
The Company continues to meet with the IUGW from time to time, in a
good faith effort to reach a new labor contract. Meanwhile, the bargaining
unit is at work under the new terms installed by the Company at the conclusion
of the lockout in late September 1995.
D. On February 2, 1996, Shenandoah Gas Company (Shenandoah), one of the
Company's distribution subsidiaries, filed a request with the Public Service
Commission of West
8
<PAGE> 10
PART II. OTHER INFORMATION (CONT'D)
Virginia for a rate increase of approximately $604,000, or 7.4%. The request
included an overall rate of return of 10.33%, a return on common equity of
12.25% and a 57.11% common equity ratio. In addition to requesting the
recovery of increased operating expenses and a return on additional capital
investment, Shenandoah requested full recovery of costs associated with
Statement of Financial Accounting Standards No. 106, "Employers' Accounting for
Postretirement Benefits Other Than Pensions."
E. On January 31, 1996, the Board of Directors elected Frederic M. Kline
to the position of Vice President and Treasurer and Elizabeth M. Arnold to the
position of Vice President.
Mr. Kline, who previously served as Controller, will be responsible
for the treasury and accounting functions of the Company. He joined the
Company in 1978 as an Executive Assistant to the Controller. He held several
positions of increasing responsibility in the Accounting Department until he
was named Controller in 1985.
Ms. Arnold, who previously served as Treasurer, will be responsible
for developing corporate strategies needed to support the Company's long-term
business goals and will continue to be responsible for the Company's investor
relations activities. She joined the Company in 1979 as Staff Associate in the
Finance Department and held several positions of increasing responsibility,
including Director of Financial Relations and Director of Marketing Services,
before being named Treasurer in 1993.
Additionally, Senior Vice President Joseph M. Schepis will now be
responsible for managing the Company's gas supply portfolio, energy sales
services and customer service and regulatory activities. Mr. Schepis joined
the Company in 1978. He held positions in the Finance and Marketing
departments before being elected Treasurer in 1986, Vice President-Rates and
Regulatory Affairs in 1993 and Senior Vice President and Chief Financial
Officer in 1994.
9
<PAGE> 11
PART II. OTHER INFORMATION (CONT'D)
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits Filed Herewith:
<TABLE>
<CAPTION>
Page in
Description 10-Q
----------- -------
<S> <C>
11 Computation of Earnings per Average Share of Common 11
Stock Assuming Full Dilution from Conversion of the
$4.60 and $4.36 Convertible Preferred Series.
27 Financial Data Schedule See Separate Volume
99.0 Computation of Ratio of Earnings to Fixed Charges 12
99.1 Computation of Ratio of Earnings to Fixed Charges and 13
Preferred Stock Dividends
</TABLE>
(b) Reports on Form 8-K:
On October 5, 1995, the Company filed a report on Form 8-K
stating that an Acting Regional Director of the National
Relations Labor Board ruled in favor of the Company on August 28,
1995 regarding the Company's conduct during negotiations with the
International Union of Gas Workers.
SIGNATURE
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.
WASHINGTON GAS LIGHT COMPANY
----------------------------------
(Registrant)
Date February 14, 1996 /s/ Frederic M. Kline
------------------------ ----------------------------------
Vice President and Treasurer
(Principal Accounting Officer)
10
<PAGE> 12
EXHIBIT 11
WASHINGTON GAS LIGHT COMPANY
Computation of Earnings per Average Share of Common Stock
Assuming Full Dilution from Conversion of the $4.60 and $4.36
Convertible Preferred Series
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended
-------------------------------
Dec. 31, 1995 Dec. 31, 1994
------------- -------------
(Thousands, except per share data)
EARNINGS PER AVERAGE SHARE ASSUMING FULL DILUTION
- -------------------------------------------------
<S> <C> <C>
Net Income $ 38,340 $ 27,726
Dividends on preferred stock (excluding
dividends on convertible preferred stock) 330 330
--------- ---------
Net income applicable to common stock $ 38,010 $ 27,396
========= =========
Average common shares outstanding on a fully
diluted basis assuming conversion of the
outstanding shares of the $4.60 and $4.36
convertible preferred stock on October 1
of each year based on the applicable
conversion price 43,082 42,313
========= =========
Earnings per average share of common stock
assuming full dilution $ .88 $ .65
========= =========
</TABLE>
- -------------------------
Note: These calculations are submitted in accordance with Securities
Exchange Act of 1934 Release No. 9083 although not required by
footnote 2 to paragraph 14 of Accounting Principles Board Opinion
No. 15 because no dilution results.
11
<PAGE> 13
EXHIBIT 99.0
WASHINGTON GAS LIGHT COMPANY
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
TWELVE MONTHS ENDED DECEMBER 31, 1995
(Unaudited)
(Dollars in Thousands)
<TABLE>
<S> <C>
FIXED CHARGES:
Interest Expense................................................ $ 30,637
Amortization of Debt Premium, Discount and Expense.............. 285
Interest Component of Rentals................................... 64
-----------
Total Fixed Charges................................. $ 30,986
===========
EARNINGS:
Net Income...................................................... $ 73,523
Add:
Income Taxes Applicable to Operating Income......... 45,409
Income Taxes Applicable to Other Income - Net....... (594)
Total Fixed Charges................................. 30,986
-----------
Total Earnings.................................................. $ 149,324
===========
Ratio of Earnings to Fixed Charges.............................. 4.8
===========
</TABLE>
12
<PAGE> 14
EXHIBIT 99.1
WASHINGTON GAS LIGHT COMPANY
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES AND
PREFERRED STOCK DIVIDENDS
TWELVE MONTHS ENDED DECEMBER 31, 1995
(Unaudited)
(Dollars in Thousands)
<TABLE>
<S> <C>
FIXED CHARGES AND PREFERRED STOCK DIVIDENDS:
Interest Expense................................................ $ 30,637
Amortization of Debt Premium, Discount and Expense.............. 285
Interest Component of Rentals................................... 64
-----------
Total Fixed Charges................................. 30,986
Pre-tax Preferred Dividends..................................... 2,146
-----------
Total............................................... $ 33,132
===========
Preferred Dividends................................................... $ 1,333
Effective Income Tax Rate............................................. .3787
Complement of Effective Income Tax Rate (1 - Tax Rate)................ .6213
Pre-Tax Preferred Dividends........................................... $ 2,146
===========
EARNINGS:
Net Income...................................................... $ 73,523
Add:
Income Taxes Applicable to Operating Income......... 45,409
Income Taxes Applicable to Other Income - Net....... (594)
Total Fixed Charges................................. 30,986
-----------
Total Earnings.................................................. $ 149,324
===========
Ratio of Earnings to Fixed Charges and
Preferred Stock Dividends........................... 4.5
===========
</TABLE>
13
<TABLE> <S> <C>
<ARTICLE> UT
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE INCOME
STATEMENT, BALANCE SHEET AND STATEMENT OF CASH FLOWS AND IS QUALIFIED IN ITS
ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> SEP-30-1996
<PERIOD-START> OCT-01-1995
<PERIOD-END> DEC-31-1995
<BOOK-VALUE> PER-BOOK
<TOTAL-NET-UTILITY-PLANT> 1,062,749
<OTHER-PROPERTY-AND-INVEST> 2,721
<TOTAL-CURRENT-ASSETS> 260,406
<TOTAL-DEFERRED-CHARGES> 120,809
<OTHER-ASSETS> 0
<TOTAL-ASSETS> 1,446,685
<COMMON> 43,261
<CAPITAL-SURPLUS-PAID-IN> 291,503
<RETAINED-EARNINGS> 208,625
<TOTAL-COMMON-STOCKHOLDERS-EQ> 543,389
0
28,471
<LONG-TERM-DEBT-NET> 379,063<F1>
<SHORT-TERM-NOTES> 16,700
<LONG-TERM-NOTES-PAYABLE> 227,390<F2>
<COMMERCIAL-PAPER-OBLIGATIONS> 20,723
<LONG-TERM-DEBT-CURRENT-PORT> 6
0
<CAPITAL-LEASE-OBLIGATIONS> 808
<LEASES-CURRENT> 808
<OTHER-ITEMS-CAPITAL-AND-LIAB> 457,525
<TOT-CAPITALIZATION-AND-LIAB> 1,446,685
<GROSS-OPERATING-REVENUE> 274,326
<INCOME-TAX-EXPENSE> 23,292
<OTHER-OPERATING-EXPENSES> 204,013
<TOTAL-OPERATING-EXPENSES> 227,305
<OPERATING-INCOME-LOSS> 47,021
<OTHER-INCOME-NET> (851)
<INCOME-BEFORE-INTEREST-EXPEN> 46,170
<TOTAL-INTEREST-EXPENSE> 7,830<F3>
<NET-INCOME> 38,340
333
<EARNINGS-AVAILABLE-FOR-COMM> 38,007
<COMMON-STOCK-DIVIDENDS> 12,112
<TOTAL-INTEREST-ON-BONDS> 7,830
<CASH-FLOW-OPERATIONS> (9,011)
<EPS-PRIMARY> .88
<EPS-DILUTED> .88
<FN>
<F1>Represents total long-term debt including, $152,825 in First Mortgage Bonds,
$227,200 in unsecured medium-term notes, $190 in other long-term debt and
$(1,152) in unamortized premium and discount-net.
<F2>Includes $227,200 in unsecured medium-term notes and other notes of $190.
<F3>Represents total interest expense, per the Statement of Income.
</FN>
</TABLE>
