<PAGE> 1
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 the Quarterly Period Ended March 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 2-2066
WISCONSIN NATURAL GAS COMPANY
(Exact name of registrant as specified in its charter)
Wisconsin 39-0713260
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
231 West Michigan Street, P.O. Box 2046, Milwaukee, Wisconsin 53201
(Address of principal executive offices) (Zip Code)
(414) 221-2345
(Registrant's telephone number, including area code)
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.
Class Outstanding at May 1, 1995
------------------------- --------------------------
$1 Par Value Common Stock 1,725,000 Shares
The registrant meets the conditions set forth in General Instruction H(1)(a)
and (b) of Form 10-Q for omission of data by certain wholly-owned subsidiaries
and is therefore filing this Form with the reduced disclosure format.
<PAGE> 2
<TABLE>
FORM 10-Q
WISCONSIN NATURAL GAS COMPANY
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
WISCONSIN NATURAL GAS COMPANY
CONDENSED INCOME STATEMENT
(Unaudited)
<CAPTION>
Three Months Ended March 31
---------------------------
1995 1994
-------- --------
(Thousands of Dollars)
<S> <C> <C>
Operating Revenues $121,100 $147,579
Operating Expenses
Cost of gas sold 72,803 91,153
Other operation expenses 15,611 18,298
Maintenance 1,311 1,517
Revitalization - 10,400
Depreciation 4,392 4,146
Income taxes 9,893 7,814
-------- --------
Total Operating Expenses 104,010 133,328
Operating Income 17,090 14,251
Other Income and Deductions
Miscellaneous - net 118 129
Income taxes (47) (54)
-------- --------
Total Other Income and Deductions 71 75
Income Before Interest Charges 17,161 14,326
Interest Charges 2,079 2,092
-------- --------
Net Income $ 15,082 $ 12,234
======== ========
<FN>
Note - Earnings and dividends per share of common stock are not applicable
because all of the company's common stock is owned by Wisconsin
Energy Corporation.
See accompanying notes to financial statements.
- 2 -
</TABLE>
<PAGE> 3
<TABLE>
FORM 10-Q
WISCONSIN NATURAL GAS COMPANY
CONDENSED BALANCE SHEET
(Unaudited)
<CAPTION>
March 31, 1995 December 31, 1994
-------------- -----------------
(Thousands of Dollars)
Assets
------
<S> <C> <C>
Utility Plant
Plant $471,559 $468,224
Accumulated provision for depreciation (224,074) (220,192)
-------- --------
Net Utility Plant 247,485 248,032
Other Property and Investments 2,152 2,344
Current Assets
Cash and cash equivalents 6,149 3,392
Accounts receivable 27,964 22,286
Accrued utility revenues 24,525 33,056
Materials, supplies and natural gas
stored 11,502 33,213
Prepayments and other assets 5,048 4,599
-------- --------
Total Current Assets 75,188 96,546
-------- --------
Deferred Charges and Other Assets
Accumulated deferred income taxes 18,799 18,799
Other 10,013 10,897
-------- --------
Total Deferred Charges and Other Assets 28,812 29,696
-------- --------
Total Assets $353,637 $376,618
======== ========
Capitalization and Liabilities
------------------------------
Capitalization
Common stock $ 81,016 $ 81,016
Retained earnings 63,563 51,106
-------- --------
Total Common Stock Equity 144,579 132,122
Long-term debt 66,535 66,519
-------- --------
Total Capitalization 211,114 198,641
Current Liabilities
Long-term debt due currently - 12,290
Short-term debt 15,494 55,478
Accounts payable 18,646 23,575
Accrued liabilities 17,224 12,313
Other 26,316 9,248
-------- -------
Total Current Liabilities 77,680 112,904
Deferred Credits and Other Liabilities
Accumulated deferred income taxes 32,489 32,182
Other 32,354 32,891
-------- --------
Total Deferred Credits and Other Liabilities 64,843 65,073
-------- --------
Total Capitalization and Liabilities $353,637 $376,618
======== ========
<FN>
See accompanying notes to financial statements.
- 3 -
</TABLE>
<PAGE> 4
<TABLE>
FORM 10-Q
WISCONSIN NATURAL GAS COMPANY
STATEMENT OF CASH FLOWS
(Unaudited)
<CAPTION>
Three Months Ended March 31
---------------------------
1995 1994
---- ----
(Thousands of Dollars)
<S> <C> <C>
Operating Activities:
Net income $15,082 $12,234
Reconciliation to cash:
Depreciation 4,392 4,146
Revitalization - net (9) 8,574
Deferred income taxes - net 307 456
Investment tax credit - net (110) (124)
Change in: Accounts receivable (5,678) (22,009)
Inventories 21,711 30,500
Accounts payable (4,929) (5,670)
Other current assets 8,082 29,577
Other current liabilities 21,979 7,313
Other 651 (1,519)
------- -------
Cash Provided by Operating Activities 61,478 63,478
Investing Activities:
Construction expenditures (3,984) (3,089)
Other 158 (1,016)
------- -------
Cash Used in Investing Activities (3,826) (4,105)
Financing Activities:
Sale of long-term debt - 9,290
Retirement of long-term debt (12,286) (10,748)
Change in short-term debt (39,984) (52,365)
Dividends on stock - common (2,625) (2,625)
------- -------
Cash Used in Financing Activities (54,895) (56,448)
------- -------
Change in Cash and Cash Equivalents $ 2,757 $ 2,925
======= =======
Supplemental Information Disclosures:
Cash Paid for -
Interest (net of amount capitalized) $ 2,548 $ 2,595
Income taxes 5,000 1,650
<FN>
See accompanying notes to financial statements.
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</TABLE>
<PAGE> 5
FORM 10-Q
WISCONSIN NATURAL GAS COMPANY
-------------------------------
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
1. The accompanying unaudited financial statements should be read in
conjunction with the company's 1994 Annual Report on Form 10-K. In the
opinion of management, all adjustments, normal and recurring in nature,
necessary to a fair statement of the results of operations and financial
position of the company have been included in the accompanying income
statement and balance sheet. The results of operations for the three
months ended March 31, 1995 are not, however, necessarily indicative of
the results which may be expected for the year 1995 because of seasonal
and other factors.
2. On April 28, 1995, Wisconsin Energy Corporation (
"WEC"), Wisconsin Natural Gas Company's ("Wisconsin Natural") parent
company, and Northern States Power Company, Minnesota ("NSP") entered into
an Agreement and Plan of Merger ("Agreement"). As a result, a registered
utility holding company, which will be known as Primergy Corporation
("Primergy"), will be the parent of NSP and the current operating
subsidiaries of NSP and WEC. Each outstanding share of common stock of
WEC will remain outstanding as one share of common stock of
Primergy, and each outstanding share of NSP will be converted into 1.626
shares of common stock of Primergy. The business combination is intended
to be tax-free for income tax purposes and to be accounted for as a
"pooling of interests". The Agreement is subject to various conditions,
including approval of the stockholders of WEC and NSP and the approval of
various regulatory agencies. WEC anticipates that the completion of the
regulatory review and approval process will take approximately 12-18
months and, accordingly, WEC and NSP do not anticipate completing this
business combination until late in 1996. ITEM 5. OTHER INFORMATION in
Part II of this report discusses further the proposed transaction.
- 5 -
<PAGE> 6
FORM 10-Q
WISCONSIN NATURAL GAS COMPANY
--------------------------------
PART I - FINANCIAL INFORMATION
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
On April 28, 1995, Wisconsin Energy Corporation ("Wisconsin Energy"), the
parent company of Wisconsin Natural Gas Company ("Wisconsin Natural"), entered
into an Agreement and Plan of Merger with Northern States Power Company
("NSP") which provides for a strategic business combination involving
Wisconsin Energy and NSP in a "merger-of-equals" transaction. Further
information concerning such agreement and proposed transaction is included in
ITEM 5. OTHER INFORMATION in Part II of this report.
RESULTS OF OPERATIONS
Net income increased approximately $3 million during the first quarter of 1995
compared to the same period in 1994, reflecting the non-recurring charge in
the first quarter of 1994 of approximately $6 million (net of tax) associated
with Wisconsin Natural's restructuring program. This charge included the cost
of severance and early retirement packages, elements of a "revitalization"
program designed to better position Wisconsin Natural in a changing market
place. It is anticipated that this charge will be offset by the end of 1995
through savings in operation and maintenance costs.
Excluding the non-recurring charge in 1994, net income decreased approximately
$3 million in the first quarter of 1995 compared to the same period in 1994.
Between the first quarter of 1995 and 1994, gas margins (operating revenue
less cost of gas sold) decreased 14.4% as a result of lower natural gas
deliveries. This was offset somewhat by a 14.6% reduction in operating and
maintenance expenses, reflecting among other things the effects of the
company's "revitalization" program.
GAS DELIVERIES
Three Months Ended March 31
---------------------------
Therms Delivered - Thousands 1995 1994 % Change
- ------------------------------- ---------- ---------- --------
Residential 145,203 167,669 (13.4)
Commercial and Industrial 90,326 97,891 (7.7)
Interruptible 14,099 16,978 (17.0)
---------- ----------
Total Sales 249,628 282,538 (11.6)
Transported Customer Owned Gas 81,867 69,263 18.2
---------- ----------
Total Gas Delivered 331,495 351,801 (5.8)
- -------------------------------
Natural gas therm deliveries during the first quarter of 1995 decreased
primarily due to the mild winter weather. As measured by heating degree days,
the first quarter of 1995 weather was 14.7% warmer compared to the same period
in 1994. The warmer winter weather significantly reduced residential and
commercial sales which have higher margins. Interruptible and transportation
deliveries combined showed an increase over the first quarter of 1994.
However, the margin on these deliveries is lower than on residential and
commercial customers.
- 6 -
<PAGE> 7
FORM 10-Q
WISCONSIN NATURAL GAS COMPANY
-----------------------------------
PART I - FINANCIAL INFORMATION (Cont'd)
SOURCES OF NATURAL GAS
Wisconsin Natural purchases gas for injection into storage for future
withdrawal during the heating season under various arrangements with gas
storage facilities. At March 31, 1995 the cost of natural gas stored for
future use was $7.3 million, representing a $1.8 million decrease from the
cost of natural gas stored at March 31, 1994. Gas stored at these facilities
is purchased by Wisconsin Natural from a number of suppliers.
For certain other information which may impact Wisconsin Natural's future
financial condition or results of operations, see ITEM 1. LEGAL PROCEEDINGS
and ITEM 5. OTHER INFORMATION in PART II.
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
The following should be read in conjunction with ITEM 3. LEGAL PROCEEDINGS in
PART I of Wisconsin Natural's Annual Report on Form 10-K for the year ended
December 31, 1994.
RATE MATTERS
Wisconsin Retail Gas Jurisdiction
1996 Test Year: On March 27, 1995, Wisconsin Electric Power Company ("Wisconsin
Electric") and Wisconsin Natural sent a letter to the Public Service
Commission of Wisconsin ("PSCW") proposing a one year deferral of their
scheduled rate case filing. On May 1, 1995, Wisconsin Natural filed with the
PSCW required data related to the 1996 test year. This was an abbreviated
filing since no increase in rates was requested. The matter is pending.
ITEM 5. OTHER INFORMATION
GAS SUPPLY PORTFOLIO MANAGEMENT AGREEMENT WITH MIDCON
On May 8, 1995, Wisconsin Natural announced that the company has entered into
an agreement with MidCon Gas Services Corporation ("MidCon") under which
MidCon will provide portfolio management for Wisconsin Natural's gas purchase,
transportation and storage contracts. The arrangement, which takes effect on
June 1, 1995, will be an integral part of a proposal that will be filed by
Wisconsin Natural with the PSCW to replace the current Purchased Gas
Adjustment mechanism with a new market-based pricing mechanism. The proposed
gas pricing mechanism would link gas commodity prices to market indices and
incorporate all other gas supply costs such as transportation and storage,
under a price cap. The price cap will be designed to provide balanced
financial incentives and risks for Wisconsin Natural and MidCon based on
performance standards, while ensuring a reliable gas supply for consumers.
- 7 -
<PAGE> 8
FORM 10-Q
WISCONSIN NATURAL GAS COMPANY
-----------------------------------
PART II - OTHER INFORMATION (Cont'd)
MERGER OF WISCONSIN NATURAL INTO WISCONSIN ELECTRIC
Wisconsin Energy intends to merge Wisconsin Natural into Wisconsin Electric to
form a single combined utility subsidiary. The merger is intended to improve
customer service and reduce operating costs. In October 1994, Wisconsin
Electric and Wisconsin Natural filed a joint application to obtain the PSCW's
approval of the merger. On May 9, 1995, the PSCW issued an order approving
the merger. In 1994, Wisconsin Electric filed an application to obtain
consent of the Michigan Public Service Commission ("MPSC") to assume Wisconsin
Natural's liabilities in connection with the merger. On April 27, 1995, the
MPSC issued an order approving the merger and the assumption of Wisconsin
Natural's liabilities by Wisconsin Electric. Completion of the planned merger
is expected to occur by January 1, 1996.
WISCONSIN ENERGY MERGER AGREEMENT WITH NORTHERN STATES POWER COMPANY
As previously reported in Wisconsin Energy's 4/28/95 8-K (defined below),
Wisconsin Energy, Northern States Power Company, a Minnesota corporation
("NSP"), and newly created subsidiaries of each of them, have entered into an
Agreement and Plan of Merger, dated as of April 28, 1995 (the "Merger
Agreement"), which provides for a strategic business combination involving NSP
and Wisconsin Energy in a "merger-of-equals" transaction (the "Transaction").
The Transaction, which was unanimously approved by the Boards of Directors of
the constituent companies, is expected to close shortly after all of the
conditions to the consummation of the Transaction, including obtaining
applicable shareholder and regulatory approvals, are met or waived. The
regulatory approval process is expected to take approximately 12 to 18 months.
In the Transaction, the holding company of the combined enterprise will be
registered under the Public Utility Holding Company Act of 1935, as amended.
The holding company will be named Primergy Corporation ("Primergy") and will
be the parent company of both NSP (which, for regulatory reasons, will
reincorporate in Wisconsin) and Wisconsin Energy's present principal utilities
subsidiary, Wisconsin Electric Power Company, which will be renamed "Wisconsin
Energy Company." Wisconsin Energy Company will include the operations of
Wisconsin Natural, which is anticipated to be merged into Wisconsin Electric
by January 1, 1996, as previously planned. It is anticipated that, following
the Transaction, NSP's present Wisconsin utility subsidiary will be merged
into Wisconsin Energy Company.
Under the terms of the Merger Agreement, based on the capitalization of
Wisconsin Energy and NSP as of the date of the Merger Agreement, the
Transaction would result in the common shareholders of NSP receiving 50% of
the common equity of Primergy for their NSP common stock and the common
shareholders of Wisconsin Energy owning the other 50% of the common equity of
Primergy. Wisconsin Electric's outstanding preferred stock will be unchanged
in the Transaction. The Transaction is intended to qualify as a tax-free
reorganization and to be accounted for as a pooling of interests.
Further information concerning the Merger Agreement and the reciprocal Stock
Option Agreements entered into by Wisconsin Energy and NSP in connection
therewith are filed as exhibits to Wisconsin Energy's Current Report on Form
- 8 -
<PAGE> 9
FORM 10-Q
WISCONSIN NATURAL GAS COMPANY
-----------------------------------
PART II - OTHER INFORMATION (Cont'd)
WISCONSIN ENERGY MERGER AGREEMENT WITH NORTHERN STATES POWER COMPANY
(Cont'd)
8-K dated as of April 28, 1995, File No. 1-9057 ("Wisconsin Energy's 4/28/95
8-K"), to which reference may be made for further information concerning the
Transaction. The Merger Agreement contains various conditions, covenants and
termination provisions as described and referred to in Wisconsin Energy's
4/28/95 8-K. Pro forma financial information with respect to the Transaction
is included in Wisconsin Energy's Form 10-Q for the quarter ended March 31,
1995.
Following announcement of the Transaction, on May 1, 1995 Standard & Poor's
Corporation ("S&P") reported that it was placing on CreditWatch with negative
implications its AA+ senior secure debt and AA+ preferred stock ratings of
Wisconsin Electric. In addition, S&P indicated that while its AA senior
secured debt rating of Wisconsin Natural would remain on CreditWatch, where it
was placed on April 25, 1995, the implications were revised to negative from
positive. S&P stated that if the Transaction is completed, the likely credit
rating for the senior secured debt of Wisconsin Electric is expected to be AA
or AA-. As part of its rating process, S&P intends to review the financial
and operating plans of the merged utilities. Also on May 1, 1995, citing
Wisconsin Electric's continued operation as a separate utility subsidiary
after the Transaction, its strength within its rating category and its strong
capital structure, Moody's Investors Service confirmed its Aa2 first mortgage
bond rating of Wisconsin Electric.
Wisconsin Energy and NSP recognize that the divestiture of their existing gas
operations and certain non-utility operations is a possibility under the new
registered holding company structure contemplated by the Transaction, but will
seek approval from the Securities and Exchange Commission ("SEC") to maintain
such businesses. If divestiture is ultimately required, the SEC has
historically allowed companies sufficient time to accomplish divestitures in a
manner that protects shareholder value.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits. The following Exhibit is filed with this report:
Exhibit No.
(27) Wisconsin Natural Gas Company Financial Data Schedule
for the three months ended March 31, 1995.
The following Exhibits are incorporated herein by reference:
(2)-1 Agreement and Plan of Merger, dated as of April 28, 1995, by
and among Northern States Power Company, Wisconsin Energy
Corporation, Northern Power Wisconsin Corp. and WEC Sub Corp.
(Exhibit (2)-1 to Wisconsin Energy Corporation's Current
Report on Form 8-K dated as of April 28, 1995, File No.
1-9057.) ("WEC's 4/28/95 8-K")
- 9 -
<PAGE> 10
FORM 10-Q
WISCONSIN NATURAL GAS COMPANY
-----------------------------------
PART II - OTHER INFORMATION (Cont'd)
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K (Cont'd)
(2)-2 WEC Stock Option Agreement, dated as of April 28, 1995, by and
among Northern States Power Company and Wisconsin Energy
Corporation. (Exhibit (2)-2 to WEC's 4/28/95 8-K.)
(2)-3 NSP Stock Option Agreement, dated as of April 28, 1995, by and
among Wisconsin Energy Corporation and Northern States Power
Company. (Exhibit (2)-3 to WEC's 4/28/95 8-K.)
(99)-1 Press Release, dated May 1, 1995, of Wisconsin Energy
Corporation. (Exhibit (99)-1 to WEC's 4/28/95 8-K.)
(b) Reports on Form 8-K:
No current reports on Form 8-K were filed in the quarter ended
March 31, 1995.
- 10 -
<PAGE> 11
FORM 10-Q
WISCONSIN NATURAL GAS COMPANY
-------------------------------
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.
WISCONSIN NATURAL GAS COMPANY
--------------------------------------
(Registrant)
s/R. R. Grigg, Jr.
------------------------------------
Date: May 12, 1995 R. R. Grigg, Jr., President and
Chief Operating Officer
s/A. K. Klisurich
------------------------------------
Date: May 12, 1995 A. K. Klisurich, Controller - Chief
Accounting Officer
- 11 -
<PAGE> 12
WISCONSIN NATURAL GAS COMPANY
-------------------------------
EXHIBIT INDEX
Quarterly Report on Form 10-Q
For the Quarter Ended March 31, 1995
Exhibit
Number
-------
The following Exhibit is filed with this report:
(27) Wisconsin Natural Gas Company Financial Data Schedule
for the three months ended March 31, 1995.
The following Exhibits are incorporated herein by reference:
(2)-1 Agreement and Plan of Merger, dated as of April 28, 1995, by
and among Northern States Power Company, Wisconsin Energy
Corporation, Northern Power Wisconsin Corp. and WEC Sub Corp.
(Exhibit (2)-1 to Wisconsin Energy Corporation's Current
Report on Form 8-K dated as of April 28, 1995, File No.
1-9057.) ("WEC's 4/28/95 8-K")
(2)-2 WEC Stock Option Agreement, dated as of April 28, 1995, by and
among Northern States Power Company and Wisconsin Energy
Corporation. (Exhibit (2)-2 to WEC's 4/28/95 8-K.)
(2)-3 NSP Stock Option Agreement, dated as of April 28, 1995, by and
among Wisconsin Energy Corporation and Northern States Power
Company. (Exhibit (2)-3 to WEC's 4/28/95 8-K.)
(99)-1 Press Release, dated May 1, 1995, of Wisconsin Energy
Corporation. (Exhibit (99)-1 to WEC's 4/28/95 8-K.)
- 12 -
<TABLE> <S> <C>
<ARTICLE> UT
<LEGEND> THE SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED
FROM THE UNAUDITED FINANCIAL STATEMENTS OF WISCONSIN NATURAL FOR
THE THREE MONTHS ENDED MARCH 31, 1995 AND IS QUALIFIED IN
ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
<MULTIPLIER> 1,000
<S> <C>
<CURRENCY> U.S. DOLLARS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-START> JAN-01-1995
<PERIOD-END> MAR-31-1995
<PERIOD-TYPE> 3-MOS
<EXCHANGE-RATE> 1
<BOOK-VALUE> PER-BOOK
<TOTAL-NET-UTILITY-PLANT> 247,485
<OTHER-PROPERTY-AND-INVEST> 2,152
<TOTAL-CURRENT-ASSETS> 75,188
<TOTAL-DEFERRED-CHARGES> 0
<OTHER-ASSETS> 28,812
<TOTAL-ASSETS> 353,637
<COMMON> 1,725
<CAPITAL-SURPLUS-PAID-IN> 79,291
<RETAINED-EARNINGS> 63,563
<TOTAL-COMMON-STOCKHOLDERS-EQ> 144,579
0
0
<LONG-TERM-DEBT-NET> 66,535
<SHORT-TERM-NOTES> 11,999
<LONG-TERM-NOTES-PAYABLE> 0
<COMMERCIAL-PAPER-OBLIGATIONS> 3,495
<LONG-TERM-DEBT-CURRENT-PORT> 0
0
<CAPITAL-LEASE-OBLIGATIONS> 0
<LEASES-CURRENT> 0
<OTHER-ITEMS-CAPITAL-AND-LIAB> 127,029
<TOT-CAPITALIZATION-AND-LIAB> 353,637
<GROSS-OPERATING-REVENUE> 121,100
<INCOME-TAX-EXPENSE> 9,893
<OTHER-OPERATING-EXPENSES> 94,117
<TOTAL-OPERATING-EXPENSES> 104,010
<OPERATING-INCOME-LOSS> 17,090
<OTHER-INCOME-NET> 71
<INCOME-BEFORE-INTEREST-EXPEN> 17,161
<TOTAL-INTEREST-EXPENSE> 2,079
<NET-INCOME> 15,082
0
<EARNINGS-AVAILABLE-FOR-COMM> 15,082
<COMMON-STOCK-DIVIDENDS> 2,625
<TOTAL-INTEREST-ON-BONDS> 1,409
<CASH-FLOW-OPERATIONS> 61,478
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
<FN>
Earnings per share of common stock is not applicable because all of the
company's common stock is owned by Wisconsin Energy Corporation.
See financial statements and footnotes in accompanying 10-Q.
</TABLE>
