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<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM U-3A-2
FILE NO. 0-29604
STATEMENT BY HOLDING COMPANY CLAIMING EXEMPTION UNDER RULE U-3A-2 FROM THE
PROVISIONS OF THE PUBLIC UTILITY HOLDING COMPANY ACT OF 1935
To Be Filed Annually Prior to March 1
ENERGYSOUTH, INC.
(Name of Company)
hereby files with the Securities and Exchange Commission (the Commission),
pursuant to Rule 2, its statement claiming exemption as a holding company from
the provisions of the Public Utility Holding Company Act of 1935 (the "Act"),
and submits the following information:
1. The Claimant ENERGYSOUTH, INC., an Alabama corporation, is a holding
company which directly or indirectly holds interests in the following
subsidiaries, each of which is also organized under the laws of the
State of Alabama:
a. Mobile Gas Service Corporation ("Mobile Gas"), a natural gas
distribution company;
b. MGS Storage Services, Inc., which owns an 87 1/2% general
partnership interest in Bay Gas Storage Company, Ltd.;
c. Bay Gas Storage Company, Ltd. ("Bay Gas"), a limited partnership
engaged in the business of underground natural gas storage;
d. EnergySouth Services, Inc., formerly known as MGS Energy
Services, Inc., which is engaged in the business of
providing contract and consulting work for utilities and
industrial customers and which owns a 51% interest in Southern
Gas Transmission Company;
e. Southern Gas Transmission Company ("SGT"), a general partnership
which operates a gas pipeline; and
f. MGS Marketing Services, Inc., which was incorporated to assist
existing and potential customers of Mobile Gas in the purchase of
natural gas.
<PAGE> 2
The business address of the Claimant and each of its subsidiaries is:
2828 Dauphin Street
Mobile, Alabama 36606
2. Mobile Gas is a "gas utility company" under the provisions of Section
2(a)(4) of the Act and is regulated by the Alabama Public Service
Commission. The properties of Mobile Gas consist primarily of natural
gas distribution systems, including mains, services, meters and
regulating equipment, serving communities in southwest Alabama,
including the City of Mobile and adjacent areas, all of which is
located in Mobile County, Alabama. Mobile Gas owns office buildings and
other miscellaneous equipment and property, all of which is located in
Mobile County, Alabama.
The properties of Bay Gas consist of an underground gas storage cavern
located in McIntosh, Alabama and related compression, dehydration and
pipeline facilities, all located primarily in Washington County,
Alabama.
The properties of SGT consist of a 50-mile natural gas pipeline from
Claiborne, Alabama to near Flomaton, Alabama, all located primarily in
Monroe County, Alabama.
Neither Claimant nor any of its subsidiaries other than Mobile Gas is a
"gas utility company" under the provisions of Section 2(a)(4) of the
Act.
3. The following is information for the last calendar year with respect to
Claimant and its subsidiary public utility company, Mobile Gas:
a. Mcf of natural or manufactured gas distributed at retail: 6,881,333
Mcf, all of which was distributed within the state of Alabama.
Mcf of natural or manufactured gas transported on behalf of end
users: 31,064,255 Mcf.
b. Mcf of natural or manufactured gas distributed at retail outside the
State in which each such company is organized: None
c. Mcf of natural or manufactured gas sold at wholesale outside the
State in which such company is organized or at the State line: None
d. Mcf of natural or manufactured gas purchased outside the State in
which each such company is organized or at the State line: 828,209
Mcf.
4. The Claimant does not hold directly or indirectly any interest in an
EWG or a foreign utility company.
2
<PAGE> 3
EXHIBIT A. A consolidating statement of income and retained earnings of the
Claimant and its subsidiary companies for the calendar year ended December 31,
1998, together with a consolidating balance sheet of Claimant and its subsidiary
companies as of the close of such calendar year is attached hereto as Exhibit A
and made a part hereof. The reorganization by which Claimant became the holding
company of Mobile Gas became effective on February 2, 1998. Thus, the statement
of income and retained earnings for EnergySouth, Inc., the parent company,
represents eleven months ended December 31, 1998.
EXHIBIT B. A Financial Data Schedule is attached hereto as Exhibit 27, including
the financial and other data required to be set forth therein pursuant to the
requirements of this Exhibit B to Form U-3A-2.
EXHIBIT C. Not Applicable.
The above-named Claimant has caused this statement to be duly executed on its
behalf by its authorized officer on this 26th day of February, 1999
ENERGYSOUTH, INC.
(Name of Claimant)
BY /s/ Charles P. Huffman
-----------------------------------------
Charles P. Huffman
Its Chief Financial Officer and Treasurer
CORPORATE SEAL
ATTEST:
By /s/ G. Edgar Downing
-----------------------------
G. Edgar Downing, Jr.
Its Secretary
Name, title and address of officer to whom notices and correspondence concerning
this statement should be addressed:
Charles P. Huffman
Chief Financial Officer and Treasurer
2828 Dauphin Street
Mobile, Alabama 36606
3
<PAGE> 1
ENERGYSOUTH, INC.
CONSOLIDATING BALANCE SHEET
AT DECEMBER 31, 1998
(UNAUDITED)
(Dollars in thousands)
EXHIBIT A
<TABLE>
<CAPTION>
SOUTHERN GAS
ACCOUNT DESCRIPTION ENERGYSOUTH MOBILE GAS MGS ENERGY TRANSMISSION MGS STORAGE
--------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Assets
Current Assets:
Cash and Cash Equivalents $ 312 $ 1,451 $ 254 $ 20 $ 23
Receivables:
Gas 6,496 -- 165
Unbilled Revenue 3,638
Merchandise 3,023
Other 860 4,083 35
Dividend 1,100
Less Allowance for Doubtful Accounts (678)
Materials, Supplies, and Mdse (at average cost) 1,256
Gas Stored Underground (at average cost) 1,634
Deferred Purchased Gas Adjustment --
Deferred Gas Costs --
Deferred Income Taxes 1,864
Prepayments 809 --
--------------------------------------------------------------------------
Total Current Assets 2,272 23,576 254 185 58
--------------------------------------------------------------------------
Property, Plant & Equipment:
Property, Plant & Equipment -- 130,409 -- 3,478 --
Less Accumulated Depreciation and Amortization 41,913 590
--------------------------------------------------------------------------
Property, Plant & Equipment - Net -- 88,496 -- 2,888 --
Construction Work in Progress 922
--------------------------------------------------------------------------
Total Property, Plant & Equipment -- 89,418 -- 2,888
--------------------------------------------------------------------------
Other Assets:
Investment in Mobile Gas Service Corporation 59,603 --
Investment in MGS Energy Services, Inc. 1,378 --
Investment in MGS Storage Services, Inc. 12,434
Investment in MGS Marketing Services, Inc. 28 --
Investment in Partnerships -- 1,519 13,674
Regulatory Assets 857
Merchandise Receivables Due After One Year 5,614
Deferred Charges 486 11
--------------------------------------------------------------------------
Total Other Assets 61,009 19,391 1,519 11 13,674
--------------------------------------------------------------------------
Total Assets $ 63,281 $ 132,385 $ 1,773 $ 3,084 $ 13,732
==========================================================================
<CAPTION>
BAY GAS CONSOLIDATED
ACCOUNT DESCRIPTION STORAGE MGS MARKETING TOTAL ELIMINATION TOTAL
---------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Assets
Current Assets:
Cash and Cash Equivalents $ 3,251 $ 242 $ 5,553 $ 5,553
Receivables:
Gas 128 351 7,140 7,140
Unbilled Revenue 3,638 3,638
Merchandise 3,023 3,023
Other 377 5,355 (4,625) 730
Dividend 1,100 (1,100) --
Less Allowance for Doubtful Accounts (678) (678)
Materials, Supplies, and Mdse (at average cost) 1,256 1,256
Gas Stored Underground (at average cost) 1,634 1,634
Deferred Purchased Gas Adjustment -- --
Deferred Gas Costs -- --
Deferred Income Taxes 1,864 1,864
Prepayments 426 1,235 1,235
--------------------------------------------------------------------------
Total Current Assets 4,182 593 31,120 (5,725) 25,395
--------------------------------------------------------------------------
Property, Plant & Equipment:
Property, Plant & Equipment 37,109 -- 170,996 -- 170,996
Less Accumulated Depreciation and Amortization 3,764 46,267 46,267
--------------------------------------------------------------------------
Property, Plant & Equipment - Net 33,345 -- 124,729 -- 124,729
Construction Work in Progress 453 1,375 1,375
--------------------------------------------------------------------------
Total Property, Plant & Equipment 33,798 -- 126,104 -- 126,104
--------------------------------------------------------------------------
Other Assets:
Investment in Mobile Gas Service Corporation 59,603 (59,603) --
Investment in MGS Energy Services, Inc. 1,378 (1,378) --
Investment in MGS Storage Services, Inc. 12,434 (12,434) --
Investment in MGS Marketing Services, Inc. 28 (28) --
Investment in Partnerships 15,193 (15,193) --
Regulatory Assets 857 857
Merchandise Receivables Due After One Year 5,614 5,614
Deferred Charges 563 1,060 1,060
--------------------------------------------------------------------------
Total Other Assets 563 -- 96,167 (88,636) 7,531
--------------------------------------------------------------------------
Total Assets $ 38,543 $ 593 $ 253,391 $ (94,361) $ 159,030
==========================================================================
</TABLE>
<PAGE> 2
ENERGYSOUTH, INC.
CONSOLIDATING BALANCE SHEET
AT DECEMBER 31, 1998
(UNAUDITED)
(Dollars in thousands)
EXHIBIT A
<TABLE>
<CAPTION>
SOUTHERN GAS
ACCOUNT DESCRIPTION ENERGYSOUTH MOBILE GAS MGS ENERGY TRANSMISSION MGS STORAGE
-----------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Capitalization and Liabilities
Current Liabilities:
Current Maturities of Long-Term Debt $ -- $ 123 $ -- $ 54 $ --
Notes Payable 4,660 -- 40 --
Accounts Payable 292 4,220 3 -- 285
Dividends Declared 1,072 1,100
Customer Deposits 1,393
Taxes Accrued 52 4,936 312 12 (747)
Interest Accrued 1,352
Deferred Purchased Gas Adjustment 1,725
Other Liabilities 546 1,397
--------------------------------------------------------------
Total Current Liabilities 1,962 20,906 315 106 (462)
--------------------------------------------------------------
Other Liabilities:
Accrued Pension Cost 1,385
Accrued Postretirement Benefit Cost 1,307
Deferred Income Taxes (118) 9,290 80 1,760
Deferred Investment Tax Credits 413 -- --
--------------------------------------------------------------
Total Other Liabilities (118) 12,395 80 -- 1,760
--------------------------------------------------------------
Total Liabilities 1,844 33,301 395 106 1,298
--------------------------------------------------------------
Capitalization:
Stockholders' Equity 49 -- 1 -- --
Capital in Excess of Par Value 18,232 17,964 10,490
Parnter's Capital 785
Retained Earnings 43,156 41,639 1,377 2,193 1,944
--------------------------------------------------------------
Total Stockholders' Equity 61,437 59,603 1,378 2,978 12,434
Minority Interest
Long-Term Debt (Less Current Maturities) 39,481 --
--------------------------------------------------------------
Total Capitalization 61,437 99,084 1,378 2,978 12,434
--------------------------------------------------------------
Total Capitalization and Liabilities $ 63,281 $ 132,385 $ 1,773 $ 3,084 $ 13,732
==============================================================
<CAPTION>
BAY GAS CONSOLIDATED
ACCOUNT DESCRIPTION STORAGE MGS MARKETING TOTAL ELIMINATION TOTAL
------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Capitalization and Liabilities
Current Liabilities:
Current Maturities of Long-Term Debt $ 794 $ -- $ 971 $ -- $ 971
Notes Payable -- 4,700 (40) 4,660
Accounts Payable 2,786 548 8,134 (4,585) 3,549
Dividends Declared 2,172 (1,100) 1,072
Customer Deposits 1,393 1,393
Taxes Accrued 85 17 4,667 4,667
Interest Accrued 139 1,491 1,491
Deferred Purchased Gas Adjustment 1,725 1,725
Other Liabilities 10 1,953 1,953
---------------------------------------------------------------
Total Current Liabilities 3,814 565 27,206 (5,725) 21,481
---------------------------------------------------------------
Other Liabilities:
Accrued Pension Cost 1,385 1,385
Accrued Postretirement Benefit Cost 1,307 1,307
Deferred Income Taxes 11,012 11,012
Deferred Investment Tax Credits 413 413
---------------------------------------------------------------
Total Other Liabilities -- -- 14,117 -- 14,117
---------------------------------------------------------------
Total Liabilities 3,814 565 41,323 (5,725) 35,598
---------------------------------------------------------------
Capitalization:
Stockholders' Equity -- -- 50 (1) 49
Capital in Excess of Par Value 46,686 (28,454) 18,232
Parnter's Capital 11,996 12,781 (12,781) --
Retained Earnings 3,632 28 93,969 (50,813) 43,156
---------------------------------------------------------------
Total Stockholders' Equity 15,628 28 153,486 (92,049) 61,437
Minority Interest 3,413 3,413
Long-Term Debt (Less Current Maturities) 19,101 58,582 58,582
---------------------------------------------------------------
Total Capitalization 34,729 28 212,068 (88,636) 123,432
---------------------------------------------------------------
Total Capitalization and Liabilities $ 38,543 $ 593 $ 253,391 $ (94,361) $ 159,030
===============================================================
</TABLE>
<PAGE> 3
ENERGYSOUTH, INC.
CONSOLIDATING INCOME STATEMENT
AND STATEMENT OF RETAINED EARNINGS
FOR THE TWELVE MONTHS ENDED DECEMBER 31, 1998
(UNAUDITED)
(Dollars in thousands)
EXHIBIT A
<TABLE>
<CAPTION>
SOUTHERN GAS
ACCOUNT DESCRIPTION ENERGYSOUTH MOBILE GAS MGS ENERGY TRANSMISSION MGS STORAGE
-------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Operating Revenues
Gas Revenues $ -- $ 68,007 $ -- $ 1,103 $ --
Merchandise Sales and Jobbing 3,139 42
Other 555
-------------------------------------------------------------
Total Operating Revenues 555 71,146 42 1,103 --
-------------------------------------------------------------
Operating Expenses
Cost of Gas 24,805
Cost of Merchandise and Jobbing 2,443 43
Operations 357 16,363 33 (35)
Maintenance 1,382 17
Depreciation 5,149 213
Taxes, Other Than Income Taxes 5,267 1 26 --
-------------------------------------------------------------
Total Operating Expenses 357 55,409 44 289 (35)
-------------------------------------------------------------
Operating Income 198 15,737 (2) 814 35
-------------------------------------------------------------
Other Income and (Expense)
Interest Expense (3,813) (3) (43) (66)
Allowance for Borrowed Funds Used
During Construction 61
Interest Income 1,238 10 3
Income From Subsidiaries/Partnerships 7,103 324 781 1,365
Less Minority Interest (383) -- (170)
-------------------------------------------------------------
Total Other Income (Expense) 7,103 (2,190) 395 (33) 1,132
-------------------------------------------------------------
Income Before Income Taxes 7,301 13,547 393 781 1,167
-------------------------------------------------------------
Income Taxes 72 4,913 142 -- 422
-------------------------------------------------------------
Income Before Cumulative Effect of Changes in Accounting Principles 7,229 $ 8,634 $ 251 $ 781 $ 745
-------------------------------------------------------------
Cumulative Effect on Prior Years of Change in Accounting Method For
Unbilled Revenue (Net of Income Tax) -- 235 -- --
Cumulative Effect on Prior Years of Change in Accounting Method For
Start-Up Costs (Net of Income Tax) (126) (58) -- -- (432)
-------------------------------------------------------------
Total Cumulative Effect of Accounting Changes ( Net of Income Tax) (126) 177 -- -- (432)
-------------------------------------------------------------
Net Income 7,103 8,811 251 781 313
Retained Earnings at December 31, 1997 -- 38,399 1,126 1,704 1,631
Merger/Acquisition of Subsidiaries 40,242
Dividends Paid/Capital Distributions (4,189) (5,571) -- (292)
-------------------------------------------------------------
Retained Earnings at December 31, 1998 $ 43,156 $ 41,639 $ 1,377 $ 2,193 $ 1,944
=============================================================
<CAPTION>
BAY GAS CONSOLIDATED
ACCOUNT DESCRIPTION STORAGE MGS MARKETING TOTAL ELIMINATION TOTAL
-------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Operating Revenues
Gas Revenues $ 5,274 $ 137 $ 74,521 $ (4,155) $ 70,366
Merchandise Sales and Jobbing 3,181 3,181
Other 555 (555) --
-------------------------------------------------------------
Total Operating Revenues 5,274 137 78,257 (4,710) 73,547
-------------------------------------------------------------
Operating Expenses
Cost of Gas 97 24,902 (4,155) 20,747
Cost of Merchandise and Jobbing 2,486 2,486
Operations 780 6 17,504 (357) 17,147
Maintenance 98 1,497 1,497
Depreciation 1,003 6,365 6,365
Taxes, Other Than Income Taxes 318 -- 5,612 5,612
-------------------------------------------------------------
Total Operating Expenses 2,199 103 58,366 (4,512) 53,854
-------------------------------------------------------------
Operating Income 3,075 34 19,891 (198) 19,693
-------------------------------------------------------------
Other Income and (Expense)
Interest Expense (1,850) (2) (5,777) 214 (5,563)
Allowance for Borrowed Funds Used --
During Construction 61 61
Interest Income 141 1,392 (214) 1,178
Income From Subsidiaries/Partnerships 9,573 (9,573) --
Less Minority Interest -- (553) -- (553)
-------------------------------------------------------------
Total Other Income (Expense) (1,709) (2) 4,696 (9,573) (4,877)
-------------------------------------------------------------
Income Before Income Taxes 1,366 32 24,587 (9,771) 14,816
-------------------------------------------------------------
Income Taxes -- 12 5,561 (72) 5,489
-------------------------------------------------------------
Income Before Cumulative Effect of Changes in Accounting Principles $ 1,366 $ 20 $ 19,026 $ (9,699) $ 9,327
-------------------------------------------------------------
Cumulative Effect on Prior Years of Change in Accounting Method For
Unbilled Revenue (Net of Income Tax) -- -- 235 235
Cumulative Effect on Prior Years of Change in Accounting Method For
Start-Up Costs (Net of Income Tax) (774) -- (1,390) 774 (616)
-------------------------------------------------------------
Total Cumulative Effect of Accounting Changes ( Net of Income Tax) (774) -- (1,155) 774 (381)
-------------------------------------------------------------
Net Income 592 20 17,871 (8,925) 8,946
Retained Earnings at December 31, 1997 3,040 8 45,908 (7,509) 38,399
Merger/Acquisition of Subsidiaries 40,242 (40,242) --
Dividends Paid/Capital Distributions (10,052) 5,863 (4,189)
-------------------------------------------------------------
Retained Earnings at December 31, 1998 $ 3,632 $ 28 $ 93,969 $(50,813) $ 43,156
=============================================================
</TABLE>
<TABLE> <S> <C>
<ARTICLE> OPUR3
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> SEP-30-1998
<PERIOD-START> JAN-01-1998
<PERIOD-END> DEC-31-1998
<BOOK-VALUE> PER-BOOK
<TOTAL-ASSETS> 159,030
<TOTAL-OPERATING-REVENUES> 73,547
<NET-INCOME> 8,946
</TABLE>
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