______________________________________________________________________________
______________________________________________________________________________
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 June 30, 1997
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from __________ to __________
Commission Registrant; State of Incorporation; IRS Employer
File Number Address; and Telephone Number Identification No.
- ----------- ----------------------------------- ------------------
1-11337 WPS RESOURCES CORPORATION 39-1775292
(A Wisconsin Corporation)
700 North Adams Street
P. O. Box 19001
Green Bay, WI 54307-9001
414-433-1466
1-3016 WISCONSIN PUBLIC SERVICE CORPORATION 39-0715160
(A Wisconsin Corporation)
700 North Adams Street
P. O. Box 19001
Green Bay, WI 54307-9001
414-433-1466
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.
WPS Resources Corporation Yes [x] No [ ]
Wisconsin Public Service Corporation Yes [x] No [ ]
Indicate the number of shares outstanding of each of the issuers' classes of
common stock, as of the latest practicable date:
WPS RESOURCES CORPORATION Common stock, $1 par value,
23,896,962 shares outstanding at
July 25, 1997
WISCONSIN PUBLIC SERVICE CORPORATION Common stock, $4 par value,
23,896,962 shares outstanding at
July 25, 1997
______________________________________________________________________________
______________________________________________________________________________
<PAGE>
WPS RESOURCES CORPORATION
AND
WISCONSIN PUBLIC SERVICE CORPORATION
FORM 10-Q FOR THE QUARTER ENDED JUNE 30, 1997
CONTENTS
Page
INTRODUCTION 4
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
WPS RESOURCES CORPORATION
Consolidated Statements of Income and
Retained Earnings 5
Consolidated Balance Sheets 6
Consolidated Statements of Capitalization 7
Consolidated Statements of Cash Flows 8
WISCONSIN PUBLIC SERVICE CORPORATION
Consolidated Statements of Income 9
Consolidated Balance Sheets 10
Consolidated Statements of Capitalization 11
Consolidated Statements of Cash Flows 12
Consolidated Statements of Retained Earnings 13
CONDENSED NOTES TO FINANCIAL STATEMENTS OF
WPS Resources Corporation and
Wisconsin Public Service Corporation 14 - 15
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations for
WPS Resources Corporation and
Wisconsin Public Service Corporation 16 - 24
PART II. OTHER INFORMATION
Item 4. Submission of Matters to a Vote of Security Holders 25
Item 5. Other Information 25 - 27
Item 6. Exhibits and Reports on Form 8-K 28
Signatures 29 - 30
-2-
<PAGE>
EXHIBIT INDEX 31
Exhibit 10.5 Deferred Compensation Plan
WPS Resources Corporation
Exhibit 10.6 Executive Employment and Severance Agreement
WPS Resources Corporation
Exhibit 11 Statement Regarding Computation of Per Share
Earnings
WPS Resources Corporation
Exhibit 27 Financial Data Schedule
WPS Resources Corporation
Wisconsin Public Service Corporation
-3-
<PAGE>
<PAGE>
INTRODUCTION
The unaudited interim financial statements presented herein include
the consolidated statements of WPS Resources Corporation and
Subsidiaries ("Company") as well as separate consolidated financial
statements for Wisconsin Public Service Corporation ("WPSC"). The
unaudited statements have been prepared by the Company and WPSC,
respectively, pursuant to the rules and regulations of the Securities
and Exchange Commission. Certain information and footnote disclosures
normally included in financial statements prepared in accordance with
generally accepted accounting principles have been condensed or
omitted pursuant to such rules and regulations. The Company and WPSC
believe, however, that the disclosures are adequate to make the
information presented not misleading. The Company's and WPSC's
consolidated financial statements should be read in conjunction with
the financial statements and notes thereto incorporated by reference
in the respective Annual Reports on Form 10-K of the Company and WPSC
for the year ended December 31, 1996.
In the opinion of the Company and WPSC, their respective interim
financial statements filed as part of this Form 10-Q reflect all
adjustments necessary to present fairly the results for the respective
periods. Due to the influence of weather and other factors which are
characteristics of WPSC's utility operations, financial results for
the periods ended June 30, 1997 and 1996 are not necessarily
indicative of trends for any 12-month period.
-4-
<PAGE>
<PAGE>
<TABLE>
Part I. FINANCIAL INFORMATION
Item 1. Financial Statements
WPS RESOURCES CORPORATION
<CAPTION>
============================================================================================================================
CONSOLIDATED STATEMENTS OF INCOME AND RETAINED EARNINGS Three Months Ended Six Months Ended
(Thousands, except per share amounts) June 30 June 30
1997 1996 1997 1996
============================================================================================================================
<S> <C> <C> <C> <C>
Operating revenues
Electric utility $118,263 $116,928 $241,227 $239,492
Gas utility 39,326 40,271 123,906 118,644
Non-regulated energy and other 33,771 24,429 89,240 74,829
- ----------------------------------------------------------------------------------------------------------------------------
Total operating revenues 191,360 181,628 454,373 432,965
============================================================================================================================
Operating expenses
Electric production fuels 24,506 24,269 51,651 50,818
Purchased power 14,901 9,233 29,057 16,332
Gas purchased for resale 25,980 28,219 87,493 81,960
Non-regulated energy cost of sales 32,251 24,116 86,611 74,516
Other operating expenses 38,057 40,078 76,292 80,025
Maintenance 13,409 12,525 22,877 21,773
Depreciation and decommissioning 19,716 16,032 37,643 32,540
Taxes other than income 6,920 6,550 13,859 13,396
- ----------------------------------------------------------------------------------------------------------------------------
Total operating expenses 175,740 161,022 405,483 371,360
============================================================================================================================
Operating income 15,620 20,606 48,890 61,605
- ----------------------------------------------------------------------------------------------------------------------------
Other income
Allowance for equity funds used during construction 33 33 68 70
Other, net 5,564 1,813 6,712 3,131
- ----------------------------------------------------------------------------------------------------------------------------
Total other income 5,597 1,846 6,780 3,201
============================================================================================================================
Income before interest expense 21,217 22,452 55,670 64,806
- ----------------------------------------------------------------------------------------------------------------------------
Interest on long-term debt 5,655 5,432 11,179 10,841
Other interest 562 566 1,590 1,274
Allowance for borrowed funds used during construction (30) (32) (64) (64)
- ----------------------------------------------------------------------------------------------------------------------------
Total interest expense 6,187 5,966 12,705 12,051
============================================================================================================================
Income before income taxes 15,030 16,486 42,965 52,755
Income taxes 4,866 5,588 14,069 17,559
Minority interest (185) - (466) -
Preferred stock dividends of subsidiary 778 778 1,556 1,556
- ----------------------------------------------------------------------------------------------------------------------------
Net income 9,571 10,120 27,806 33,640
============================================================================================================================
Retained earnings at beginning of period 318,678 321,373 311,794 308,965
Cash dividends on common stock 11,351 11,112 22,702 22,224
- ----------------------------------------------------------------------------------------------------------------------------
Retained earnings at end of period $316,898 $320,381 $316,898 $320,381
============================================================================================================================
Average shares of common stock 23,875 23,893 23,878 23,894
Earnings per average share of common stock $0.40 $0.42 $1.16 $1.41
Dividend per share of common stock $0.475 $0.465 $0.950 $0.930
============================================================================================================================
</TABLE>
The accompanying notes are an integral part of these statements.
-5-
PAGE
<PAGE>
<TABLE>
WPS RESOURCES CORPORATION
<CAPTION>
======================================================================================================
CONSOLIDATED BALANCE SHEETS June 30 December 31
(Thousands) 1997 1996
======================================================================================================
<S> <C> <C>
ASSETS
- ------------------------------------------------------------------------------------------------------
Utility plant
Electric $1,492,728 $1,474,104
Gas 244,084 240,791
- ------------------------------------------------------------------------------------------------------
Total 1,736,812 1,714,895
Less - Accumulated depreciation and decommissioning 996,514 952,296
- ------------------------------------------------------------------------------------------------------
Total 740,298 762,599
Nuclear decommissioning trusts 117,814 100,570
Construction in progress 12,895 10,301
Nuclear fuel, less accumulated amortization 20,920 19,381
- ------------------------------------------------------------------------------------------------------
Net utility plant 891,927 892,851
======================================================================================================
Current assets
Cash and equivalents 4,469 5,978
Customer and other receivables, net of reserves 80,852 106,967
Accrued utility revenues 18,400 35,386
Fossil fuel, at average cost 11,676 8,224
Gas in storage, at average cost 11,691 19,987
Materials and supplies, at average cost 19,715 19,944
Prepayments and other 19,675 22,658
- ------------------------------------------------------------------------------------------------------
Total current assets 166,478 219,144
======================================================================================================
Regulatory assets 87,959 96,920
Net non-utility and non-regulated plant 18,913 19,738
Investments and other assets 112,298 102,011
======================================================================================================
Total $1,277,575 $1,330,664
======================================================================================================
CAPITALIZATION AND LIABILITIES
- ------------------------------------------------------------------------------------------------------
Capitalization
Common stock equity $ 474,047 $ 467,524
Preferred stock of subsidiary
with no mandatory redemption 51,200 51,200
Long-term debt 304,955 305,788
- ------------------------------------------------------------------------------------------------------
Total capitalization 830,202 824,512
======================================================================================================
Current liabilities
Notes payable 12,900 26,600
Commercial paper 7,600 31,350
Accounts payable 69,613 96,531
Accrued taxes 813 1,350
Accrued interest 8,132 8,134
Other 19,013 12,771
- ------------------------------------------------------------------------------------------------------
Total current liabilities 118,071 176,736
======================================================================================================
Long-term liabilities and deferred credits
Accumulated deferred income taxes 128,042 130,208
Accumulated deferred investment credits 27,785 28,669
Regulatory liabilities 49,340 48,870
Environmental remediation liabilities 40,066 41,697
Other long-term liabilities 84,676 80,173
- ------------------------------------------------------------------------------------------------------
Total long-term liabilities and deferred credits 329,909 329,617
======================================================================================================
Minority interest (607) (201)
======================================================================================================
Total $1,277,575 $1,330,664
======================================================================================================
</TABLE>
The accompanying notes are an integral part of these statements.
-6-
PAGE
<PAGE>
<TABLE>
WPS RESOURCES CORPORATION
<CAPTION>
=====================================================================================================
CONSOLIDATED STATEMENTS OF CAPITALIZATION June 30 December 31
(Thousands, except share amounts) 1997 1996
=====================================================================================================
<S> <C> <C>
Common stock equity
Common stock, $1 par value, 100,000,000 shares authorized;
and 23,896,962 shares outstanding $ 23,897 $ 23,897
Premium on capital stock 145,021 145,021
Retained earnings 316,898 311,794
Shares in deferred compensation trust, 24,852 and 14,223 shares
at average cost of $29.38 and $31.16 per share at
June 30, 1997 and December 31, 1996, respectively. (730) (443)
ESOP loan guarantees (11,039) (12,745)
- -----------------------------------------------------------------------------------------------------
Total common stock equity 474,047 467,524
=====================================================================================================
Preferred stock - Wisconsin Public Service Corporation
Cumulative, $100 par value, 1,000,000 shares authorized;
with no mandatory redemption
Series Shares Outstanding
------ ------------------
5.00% 132,000 13,200 13,200
5.04% 30,000 3,000 3,000
5.08% 50,000 5,000 5,000
6.76% 150,000 15,000 15,000
6.88% 150,000 15,000 15,000
- -----------------------------------------------------------------------------------------------------
Total preferred stock 51,200 51,200
=====================================================================================================
Long-term debt
First mortgage bonds - Wisconsin Public Service Corporation
Series Year Due
------ --------
5-1/4% 1998 50,000 50,000
7.30% 2002 50,000 50,000
6.80% 2003 50,000 50,000
6-1/8% 2005 9,075 9,075
6.90% 2013 22,000 22,000
8.80% 2021 53,100 53,100
7-1/8% 2023 50,000 50,000
- -----------------------------------------------------------------------------------------------------
Total 284,175 284,175
Unamortized discount and premium on bonds, net (934) (978)
- -----------------------------------------------------------------------------------------------------
Total first mortgage bonds 283,241 283,197
- -----------------------------------------------------------------------------------------------------
ESOP loan guarantees 11,039 12,745
Notes payable to bank, secured by non-regulated plant 10,437 9,581
Other long-term debt 238 265
- -----------------------------------------------------------------------------------------------------
Total long-term debt 304,955 305,788
=====================================================================================================
Total capitalization $830,202 $824,512
=====================================================================================================
</TABLE>
The accompanying notes are an integral part of these statements.
-7-
PAGE
<PAGE>
<TABLE>
WPS RESOURCES CORPORATION
<CAPTION>
============================================================================================
CONSOLIDATED STATEMENTS OF CASH FLOWS Six Months Ended
(Thousands) June 30
1997 1996
============================================================================================
<S> <C> <C>
Cash flows from operating activities
Net income $27,806 $33,640
Adjustments to reconcile net income to net cash from
operating activities
Depreciation and decommissioning 37,643 32,540
Amortization of nuclear fuel and other 4,432 15,198
Deferred income taxes (3,038) (3,750)
Investment tax credit restored (884) (889)
Allowance for equity funds used during construction (68) (70)
Pension income (6,182) (6,229)
Post-retirement funding 2,494 3,575
Deferred demand-side management expenditures (5) (3,893)
Other, net 5,927 (1,908)
Changes in
Customer and other receivables 26,115 3,724
Accrued utility revenues 16,986 18,924
Fossil fuel inventory (3,452) (1,430)
Gas in storage 8,296 (776)
Accounts payable (26,918) (6,001)
Miscellaneous current and accrued liabilities 6,226 5,938
Accrued taxes (537) 3,701
Gas refunds 17 (5,668)
- --------------------------------------------------------------------------------------------
Net cash from operating activities 94,858 86,626
============================================================================================
Cash flows from (used for) investing activities
Construction of utility plant and nuclear fuel expenditures (29,480) (40,840)
Purchase of other property and equipment (301) (800)
Decommissioning funding (7,439) (4,489)
Purchase of investments and acquisitions 617 0
Other (497) 288
- --------------------------------------------------------------------------------------------
Net cash from (used for) investing activities (37,100) (45,841)
============================================================================================
Cash flows from (used for) financing activities
Change in notes payable (13,700) (400)
Change in other long-term debt 1,173 (6,900)
Change in commercial paper (23,750) (11,500)
Cash dividends on common stock (22,702) (22,224)
Purchase of deferred compensation stock (288) (195)
- --------------------------------------------------------------------------------------------
Net cash from (used for) financing activities (59,267) (41,219)
============================================================================================
Net increase (decrease) in cash and equivalents (1,509) (434)
Cash and equivalents at beginning of period 5,978 6,533
============================================================================================
Cash and equivalents at end of period $ 4,469 $ 6,099
============================================================================================
Cash paid during period for
Interest, less amount capitalized $11,385 $10,668
Income taxes 19,820 17,330
Preferred stock dividends of subsidiary 1,556 1,556
============================================================================================
</TABLE>
The accompanying notes are an integral part of these statements.
-8-
PAGE
<PAGE>
<TABLE>
WISCONSIN PUBLIC SERVICE CORPORATION
<CAPTION>
============================================================================================================================
CONSOLIDATED STATEMENTS OF INCOME Three Months Ended Six Months Ended
(Thousands) June 30 June 30
1997 1996 1997 1996
- ----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Operating revenues
Electric $118,263 $116,928 $241,227 $239,492
Gas 39,326 40,271 123,906 118,644
- ----------------------------------------------------------------------------------------------------------------------------
Total operating revenues 157,589 157,199 365,133 358,136
============================================================================================================================
Operating expenses
Electric production fuels 24,506 24,269 51,651 50,818
Purchased power 14,901 9,233 29,057 16,332
Gas purchased for resale 25,896 28,219 87,409 81,960
Other operating expenses 34,300 38,642 68,303 77,142
Maintenance 13,409 12,525 22,877 21,773
Depreciation and decommissioning 19,287 15,743 36,815 32,012
Taxes
Federal income 3,534 4,918 12,204 14,902
Investment tax credit restored (442) (445) (884) (889)
State income 1,143 1,492 3,913 4,676
Gross receipts and other 6,894 6,550 13,825 13,396
- ----------------------------------------------------------------------------------------------------------------------------
Total operating expenses 143,428 141,146 325,170 312,122
============================================================================================================================
Operating income 14,161 16,053 39,963 46,014
- ----------------------------------------------------------------------------------------------------------------------------
Other income and (deductions)
Allowance for equity funds used during construction 33 33 68 70
Other, net 5,378 1,761 6,784 3,026
Income taxes (1,483) (184) (1,515) (284)
- ----------------------------------------------------------------------------------------------------------------------------
Total other income and (deductions) 3,928 1,610 5,337 2,812
============================================================================================================================
Income before interest expense 18,089 17,663 45,300 48,826
- ----------------------------------------------------------------------------------------------------------------------------
Interest expense
Interest on long-term debt 5,634 5,696 11,268 11,239
Other interest 493 524 1,347 1,216
Allowance for borrowed funds used during construction (30) (32) (64) (64)
- ----------------------------------------------------------------------------------------------------------------------------
Total interest expense 6,097 6,188 12,551 12,391
============================================================================================================================
Net income 11,992 11,475 32,749 36,435
Preferred stock dividend requirements 778 778 1,556 1,556
- ----------------------------------------------------------------------------------------------------------------------------
Earnings on common stock $ 11,214 $ 10,697 $ 31,193 $ 34,879
============================================================================================================================
</TABLE>
The accompanying notes are an integral part of these statements.
-9-
PAGE
<PAGE>
<TABLE>
WISCONSIN PUBLIC SERVICE CORPORATION
<CAPTION>
==================================================================================================
CONSOLIDATED BALANCE SHEETS June 30 December 31
(Thousands) 1997 1996
==================================================================================================
<S> <C> <C>
ASSETS
- --------------------------------------------------------------------------------------------------
Utility plant
Electric $1,492,728 $1,474,104
Gas 244,084 240,791
- --------------------------------------------------------------------------------------------------
Total 1,736,812 1,714,895
Less - Accumulated depreciation and decommissioning 996,514 952,296
- --------------------------------------------------------------------------------------------------
Total 740,298 762,599
Nuclear decommissioning trusts 117,814 100,570
Construction in progress 12,895 10,301
Nuclear fuel, less accumulated amortization 20,920 19,381
- --------------------------------------------------------------------------------------------------
Net utility plant 891,927 892,851
==================================================================================================
Current assets
Cash and equivalents 3,367 4,165
Customer and other receivables, net of reserves 63,521 66,234
Accrued utility revenues 18,400 35,326
Fossil fuel, at average cost 11,402 8,224
Gas in storage, at average cost 10,457 16,440
Materials and supplies, at average cost 19,715 19,796
Prepayments and other 19,449 22,189
- --------------------------------------------------------------------------------------------------
Total current assets 146,311 172,374
==================================================================================================
Regulatory assets 87,959 96,920
Net non-utility plant 3,018 4,191
Investments and other assets 103,218 92,612
==================================================================================================
Total $1,232,433 $1,258,948
==================================================================================================
CAPITALIZATION AND LIABILITIES
- --------------------------------------------------------------------------------------------------
Capitalization
Common stock equity $ 448,621 $ 448,425
Preferred stock with no mandatory redemption 51,200 51,200
Long-term debt to parent 14,494 14,612
Long-term debt 294,518 296,207
- --------------------------------------------------------------------------------------------------
Total capitalization 808,833 810,444
==================================================================================================
Current liabilities
Note payable 10,000 10,000
Commercial paper 7,600 29,000
Accounts payable 53,077 62,500
Accrued taxes 813 1,350
Accrued interest 8,132 8,134
Other 18,638 12,324
- --------------------------------------------------------------------------------------------------
Total current liabilities 98,260 123,308
==================================================================================================
Long-term liabilities and deferred credits
Accumulated deferred income taxes 129,655 131,549
Accumulated deferred investment tax credits 27,785 28,669
Regulatory liabilities 49,340 48,870
Environmental remediation liabilities 40,066 41,697
Other long-term liabilities 78,494 74,411
- --------------------------------------------------------------------------------------------------
Total long-term liabilities and deferred credits 325,340 325,196
==================================================================================================
Total $1,232,433 $1,258,948
==================================================================================================
</TABLE>
The accompanying notes are an integral part of these statements.
-10-
PAGE
<PAGE>
<TABLE>
WISCONSIN PUBLIC SERVICE CORPORATION
<CAPTION>
========================================================================================================
CONSOLIDATED STATEMENTS OF CAPITALIZATION June 30 December 31
(Thousands, except share amounts) 1997 1996
========================================================================================================
<S> <C> <C>
Common stock equity
Common stock $ 95,588 $ 95,588
Premium on capital stock 73,842 73,842
Retained earnings 290,230 291,740
ESOP loan guarantees (11,039) (12,745)
- --------------------------------------------------------------------------------------------------------
Total common stock equity 448,621 448,425
========================================================================================================
Preferred stock
Cumulative, $100 par value, 1,000,000 shares authorized;
with no mandatory redemption
Series Shares Outstanding
------ ------------------
5.00% 132,000 13,200 13,200
5.04% 30,000 3,000 3,000
5.08% 50,000 5,000 5,000
6.76% 150,000 15,000 15,000
6.88% 150,000 15,000 15,000
- --------------------------------------------------------------------------------------------------------
Total preferred stock 51,200 51,200
========================================================================================================
Long-term debt to parent
Series Year Due
------ --------
8.76% 2015 5,964 6,012
7.35% 2016 8,530 8,600
- --------------------------------------------------------------------------------------------------------
Total long-term debt to parent 14,494 14,612
========================================================================================================
Long-term debt
First mortgage bonds
Series Year Due
------ --------
5-1/4% 1998 50,000 50,000
7.30% 2002 50,000 50,000
6.80% 2003 50,000 50,000
6-1/8% 2005 9,075 9,075
6.90% 2013 22,000 22,000
8.80% 2021 53,100 53,100
7-1/8% 2023 50,000 50,000
- --------------------------------------------------------------------------------------------------------
Total 284,175 284,175
Unamortized discount and premium on bonds, net (934) (978)
- --------------------------------------------------------------------------------------------------------
Total first mortgage bonds 283,241 283,197
- --------------------------------------------------------------------------------------------------------
ESOP loan guarantees 11,039 12,745
Other long-term debt 238 265
- --------------------------------------------------------------------------------------------------------
Total long-term debt 294,518 296,207
========================================================================================================
Total capitalization $808,833 $810,444
========================================================================================================
</TABLE>
The accompanying notes are an integral part of these statements.
-11-
PAGE
<PAGE>
<TABLE>
WISCONSIN PUBLIC SERVICE CORPORATION
<CAPTION>
============================================================================================
CONSOLIDATED STATEMENTS OF CASH FLOWS Six Months Ended
(Thousands) June 30
1997 1996
============================================================================================
<S> <C> <C>
Cash flows from operating activities
Net income $32,749 $36,435
Adjustments to reconcile net income to net cash from
operating activities
Depreciation and decommissioning 36,815 32,012
Amortization of nuclear fuel and other 4,432 14,742
Deferred income taxes (2,766) (3,549)
Investment tax credit restored (884) (889)
Allowance for equity funds used during construction (68) (70)
Pension income (6,182) (6,229)
Post-retirement funding 2,494 3,575
Deferred demand-side management expenditures (5) (3,893)
Other, net 5,721 (1,565)
Changes in
Customer and other receivables 2,713 1,223
Accrued utility revenues 16,926 18,924
Fossil fuel inventory (3,178) (1,430)
Gas in storage 5,983 (847)
Accounts payable (9,423) (3,558)
Miscellaneous current and accrued liabilities 6,297 7,976
Accrued taxes (537) 1,891
Gas refunds 17 (5,668)
- --------------------------------------------------------------------------------------------
Net cash from operating activities 91,104 89,080
============================================================================================
Cash flows from (used for) investing activities
Construction of utility plant and nuclear fuel expenditures (29,480) (40,904)
Decommissioning funding (7,439) (4,489)
Purchase of other property and equipment (94) (343)
Other 770 220
- --------------------------------------------------------------------------------------------
Net cash from (used for) investing activities (36,243) (45,516)
============================================================================================
Cash flows from (used for) financing activities
Redemption of first mortgage bonds 0 (6,900)
Proceeds of long-term debt from parent 0 8,618
Change in commercial paper (21,400) (11,500)
Preferred stock dividends (1,556) (1,556)
Common stock dividends (32,703) (33,224)
- --------------------------------------------------------------------------------------------
Net cash from (used for) financing activities (55,659) (44,562)
============================================================================================
Net increase (decrease) in cash and equivalents (798) (998)
Cash and equivalents at beginning of period 4,165 4,471
============================================================================================
Cash and equivalents at end of period $ 3,367 $ 3,473
============================================================================================
Cash paid during period for
Interest, less amount capitalized $11,135 $10,668
Income taxes 23,561 18,372
============================================================================================
</TABLE>
The accompanying notes are an integral part of these statements.
-12-
PAGE
<PAGE>
<TABLE>
WISCONSIN PUBLIC SERVICE CORPORATION
<CAPTION>
============================================================================================
CONSOLIDATED STATEMENTS OF RETAINED EARNINGS Six Months Ended
(Thousands) June 30
1997 1996
============================================================================================
<S> <C> <C>
Balance at beginning of period $291,740 $290,387
Add Net income 32,749 36,435
- --------------------------------------------------------------------------------------------
324,489 326,822
- --------------------------------------------------------------------------------------------
Deduct
Cash dividends declared on preferred stock 1,556 1,556
Dividends declared on common stock 32,703 33,224
- --------------------------------------------------------------------------------------------
34,259 34,780
- --------------------------------------------------------------------------------------------
Balance at end of period $290,230 $292,042
============================================================================================
</TABLE>
The accompanying notes are an integral part of these statements.
-13-
PAGE
<PAGE>
WPS RESOURCES CORPORATION AND SUBSIDIARIES
WISCONSIN PUBLIC SERVICE CORPORATION
CONDENSED NOTES TO FINANCIAL STATEMENTS
JUNE 30, 1997
NOTE 1. FINANCIAL INFORMATION
______________________________
The foregoing consolidated financial statements have been prepared by
WPS Resources Corporation ("Company") and Wisconsin Public Service
Corporation ("WPSC"), without audit, pursuant to the rules and
regulations of the Securities and Exchange Commission ("SEC") and, in
the opinion of Management, include all adjustments (consisting only of
normal recurring adjustments) necessary for a fair statement of
results for each period shown. Certain information and footnote
disclosures normally included in financial statements prepared in
accordance with generally accepted accounting principles have been
condensed or omitted pursuant to such SEC rules and regulations. The
Company believes that the disclosures made are adequate to make the
information presented not misleading. It is recommended that these
financial statements be read in conjunction with the financial
statements and notes thereto included in the Company's and WPSC's
latest annual reports on Form 10-K.
Because of the seasonal nature of the Company's operations, interim
results are not necessarily indicative of annual results.
NOTE 2. EARNINGS PER SHARE
___________________________
In February 1997, the Financial Accounting Standards Board ("FASB")
issued Statement of Financial Accounting Standards ("SFAS") No. 128,
Earnings Per Share. This statement establishes standards for
computing and presenting earnings per share. The Company will be
adopting this standard at December 31, 1997 and does not expect that
adoption will have an impact on its presentation of earnings per
share.
NOTE 3. COMPREHENSIVE INCOME
_____________________________
In June 1997, the FASB issued SFAS No. 130, Reporting of Comprehensive
Income, which establishes standards for reporting and display of
-14-
<PAGE>
comprehensive income and its components of revenues, expenses, gains,
and losses. The statement is effective for fiscal years beginning
after December 15, 1997 and the Company will be adopting the
requirements for reporting comprehensive income in the first quarter
of 1998.
NOTE 4. SEGMENT DISCLOSURES
____________________________
In June 1997, the FASB issued SFAS No. 131, Disclosures about Segments
of an Enterprise and Related Information. This statement establishes
standards for reporting information about operating segments and is
effective for periods beginning after December 15, 1997. The Company
will be adopting the requirements of this statement in the first
quarter of 1998.
NOTE 5. AGREEMENT TO MERGE WITH UPPER PENINSULA ENERGY CORPORATION
___________________________________________________________________
On July 10, 1997, the Company announced a merger agreement with
Upper Peninsula Energy Corporation ("UPEN"). The merger is subject to
(i) approval by the shareholders of UPEN; (ii) approval by the
Federal Energy Regulatory Commission; (iii) the Form S-4 Registration
Statement of the Company being declared effective by the Securities
and Exchange Commission; (iv) the expiration or termination of the
waiting period applicable to the merger under the Hart-Scott-Rodino
Antitrust Improvements Act of 1976; (v) receipt by the parties of an
opinion of counsel that the exchange of stock qualifies as a tax-free
transaction; (vi) receipt by the parties of appropriate assurances
that the transaction will be accounted for as a pooling of interests;
and (vii) the satisfaction of various other conditions. The merger is
expected to be completed in 1998. UPEN will merge with and into the
Company and the Upper Peninsula Power Company, UPEN's utility
subsidiary, will become a wholly-owned subsidiary of the Company.
-15-
<PAGE>
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
WPS Resources Corporation ("Company") is a holding company.
Approximately 96% and 80% of the Company's assets and revenues,
respectively, are derived from Wisconsin Public Service Corporation
("WPSC"), an electric and gas utility.
OVERVIEW OF SECOND QUARTER OF 1997 COMPARED TO SECOND QUARTER OF 1996
Earnings per share were $.40 in 1997 compared to $.42 in 1996.
Electric utility margins at WPSC was lower in 1997 compared to 1996 as
a result of the implementation of a Public Service Commission of
Wisconsin ("PSCW") rate order which was received on February 20, 1997,
and authorized a $35.5 million, or 8.1%, electric rate reduction. In
addition, electric margins were affected by increased replacement
power costs as a result of an extended outage at WPSC's Kewaunee
Nuclear Power Plant ("Kewaunee"). WPSC is the operator and 41.2%
owner of Kewaunee. A $2.0 million per month surcharge authorized by
the PSCW in the February 20 order partially offset the increase to
replacement power costs. Kewaunee returned to service in mid-June,
1997, and the $2.0 million per month surcharge was discontinued
effective July 1, 1997. Other significant factors for the quarter
include a decrease in operating expenses at WPSC and an increase in
operating expenses at the Company's non-regulated subsidiaries. Other
income increased at WPSC as a result of one-time gains on the sale of
non-utility property.
ELECTRIC UTILITY OPERATIONS
Electric margins were lower than 1996 by $4.6 million, or 5.5%, due to
increased replacement power costs as a result of an extended outage at
Kewaunee and implementation of a PSCW rate order which reduced
electric rates. A surcharge authorized by the PSCW partially offset
the increases to replacement power costs.
-16-
<PAGE>
Second Quarter
---------------------------
Electric Margins (000's) 1997 1996
- ------------------------ ---- ----
Revenues $118,263 $116,928
Fuel and purchased power 39,407 33,502
------- -------
Margins $ 78,856 $ 83,426
======= =======
Sales in kilowatt-hours (000) 2,719,481 2,673,817
Electric revenues remained fairly stable during the second quarter of
1997 as compared to the second quarter of 1996 despite the 8.1% rate
decrease. Commercial and industrial Kwh sales rose 7.0% reflecting
colder weather and customer growth. Wholesale Kwh sales decreased
12.3% because WPSC did not have the generation available to sell to
wholesale customers.
Electric fuels and purchases increased $5.9 million, or 17.6%, in the
second quarter of 1997 as compared to the same period in 1996. This
increase was the result of increased purchased power costs of
$5.7 million, or 61.4%, reflecting a 45.8% increase in Kwh purchases.
Purchased power requirements were increased due to decreased
production at Kewaunee as a result of an extended outage. Purchased
power represented 25.8% of total Kwh generation in the second quarter
of 1997 compared to 18.0% in the second quarter of 1996.
GAS UTILITY OPERATIONS
Gas margins increased $1.3 million, or 10.7%, due primarily to a 5.9%
increase in heating degree days and a gas rate increase.
-17-
<PAGE>
Second Quarter
--------------------------
Gas Margins (000's) 1997 1996
- ------------------- ---- ----
Revenues $39,326 $40,271
Purchase costs 25,980 28,219
------ ------
Margins $13,346 $12,052
====== ======
Volume in therms (000) 134,194 126,328
The PSCW allows WPSC to pass changes in the cost of gas on to
customers through a purchased gas adjustment clause.
Gas operating revenues remained fairly stable during the second
quarter of 1997 compared to the second quarter of 1996. Gas sales
volumes increased by 3.5% while gas costs decreased by 5.7%. Gas
revenues also reflect implementation of a PSCW order authorizing a
$5.7 million, or 2.7%, increase in gas rates.
Gas purchased for resale decreased $2.2 million, or 7.9%, in the
second quarter of 1997 as compared to the same period in 1996. This
decrease was due primarily to lower gas costs in the second quarter of
1997.
NON-REGULATED OPERATIONS
Non-regulated energy and other operating revenues increased
$9.3 million, or 38.2%. Non-regulated energy revenues primarily
represent the electric and gas sales of WPS Energy Services, Inc.
("ESI"), the Company's energy marketing subsidiary. The increase in
non-regulated energy revenues consisted largely of increased gas sales
at ESI of $5.1 million, or 20.7%, as a result of customer growth. In
addition, ESI had increased revenues of $2.8 million related to
electric sales. ESI received power "marketer" status from the Federal
Energy Regulatory Commission in April of 1996 which provided increased
flexibility for the sale of electric energy and capacity at market
rates.
Other operating revenues increased $.4 million due to increased
consulting activities at WPS Power Development, Inc. ("PDI"), a
-18-
<PAGE>
company organized to participate in the development of electric
generation projects and to provide services to the non-regulated
electric power generation industry.
Non-regulated energy cost of sales increased $8.1 million, or 33.7%,
due primarily to increased gas purchases and purchased power costs of
$5.3 million and $2.7 million, respectively, at ESI.
OTHER EXPENSES
Other operating expenses at the Company decreased $2.0 million, or
5.0%.
Other operating expenses at WPSC decreased $4.3 million, or 11.2%.
This decrease was due to lower customer service expenses of
$2.1 million and lower electric operating expenses of $1.5 million
partially due to completion in 1996 of the retail amortization related
to a deferred coal and rail contract settlement. In addition, WPSC
has initiated several cost control efforts which have decreased
operating expenses.
Other operating expenses at ESI increased $.8 million, or 66.9%, due
to expansion of the business.
Other operating expenses at PDI increased $1.0 million as a result of
expansion of the business and initial operation of the Stoneman Power
Plant. Other operating expenses also increased at the Company.
Depreciation and decommissioning expenses increased $3.7 million, or
23.0%, largely due to the accelerated recovery of investment in
Kewaunee and accelerated funding of Kewaunee decommissioning costs.
Other income increased $3.8 million, or 203.2%, due primarily to gains
on sales of non-utility property at WPSC which represented
approximately $.07 per share.
OVERVIEW OF SIX MONTHS OF 1997 COMPARED TO SIX MONTHS OF 1996
Earnings per share were $1.16 in 1997 compared to $1.41 in 1996. The
primary reason for the variance in earnings was a decrease in the
electric utility margin at WPSC. The electric margin decrease was
primarily a result of the implementation of a PSCW rate order on
February 21, 1997, which authorized an 8.1% electric rate reduction.
In addition, electric margins decreased due to increased replacement
power costs as a result of an extended outage at Kewaunee. A
-19-
<PAGE>
$2.0 million per month surcharge authorized by the PSCW beginning
February 21, 1997, partially offset the increases to replacement power
costs. Kewaunee returned to service in mid-June, 1997, and the
$2.0 million per month surcharge was discontinued effective
July 1, 1997.
ELECTRIC UTILITY OPERATIONS
Electric margins decreased by $11.8 million, or 6.9%, due to increased
replacement power costs as a result of an extended outage at Kewaunee
and implementation of a PSCW rate order which reduced electric rates.
A surcharge authorized by the PSCW partially offset increases to
replacement power costs in the latter part of the first quarter and in
the second quarter.
Six Months
---------------------------
Electric Margins (000's) 1997 1996
- ------------------------ ---- ----
Revenues $241,227 $239,492
Fuel and purchased power 80,708 67,150
------- -------
Margins $160,519 $172,342
======= =======
Sales in kilowatt-hours (000) 5,478,241 5,411,647
Electric revenues increased $1.7 million, or .7%, during the first six
months of 1997 compared to the first six months of 1996. Commercial
and industrial sales rose 5.8% while wholesale Kwh sales decreased
10.8% because WPSC did not have the generation available to sell to
wholesale customers.
Electric fuel and purchases increased $13.6 million, or 20.2%, in the
first six months of 1997 compared to the first six months of 1996.
This increase was primarily the result of increased purchased power
costs of $12.7 million, or 77.9%, reflecting a 55.9% increase in Kwh
purchases. Purchased power requirements were increased due to
decreased production at Kewaunee as a result of an extended outage.
Purchased power represented 24.6% of total Kwh generation for the
six-month period ended June 30, 1997 compared to 15.9% for the same
period in 1996.
-20-
<PAGE>
GAS UTILITY OPERATIONS
Gas margins remained fairly stable between the first six months of
1997 and the first six months of 1996 reflecting the implementation of
a PSCW rate order on February 21, 1997, which authorized a 2.7%
increase in gas revenues offset by a 3.7% decrease in heating degree
days.
Six Months
--------------------------
Gas Margins (000's) 1997 1996
- ------------------- ---- ----
Revenues $123,906 $118,644
Purchase costs 87,493 81,960
------- -------
Margins $ 36,413 $ 36,684
======= =======
Volume in therms (000) 385,366 381,421
The PSCW allows WPSC to pass changes in the cost of gas on to
customers through a purchased gas adjustment clause.
Gas operating revenues increased $5.3 million, or 4.4%, during the
first six months of 1997 compared to the same period in 1996. This
increase was due primarily to higher gas costs in the first quarter of
1997. Gas revenues also reflect the PSCW authorized rate increase of
2.7% and a one-time reduction of $.9 million in the first quarter
based on a PSCW directive related to a change in the accounting
treatment for previous customer line extensions.
Gas purchased for resale showed a net increase of $5.5 million, or
6.8%, in the first six months of 1997 as compared to the same period
in 1996 due primarily to increased gas costs in the first quarter of
1997.
NON-REGULATED OPERATIONS
Non-regulated energy and other operating revenues increased
$14.4 million, or 19.3%. The increase in non-regulated energy
revenues consisted largely of increased gas sales at ESI of
$8.7 million, or 11.7%, as a result of customer growth and higher
market prices for gas. ESI also had increased sales of $3.7 million
-21-
<PAGE>
related to electric sales. In addition, other operating revenues
increased $1.8 million due to increased consulting activities at PDI.
Non-regulated energy cost of sales increased $12.1 million, or 16.2%,
due primarily to increased gas purchases and purchased power of
$8.3 million and $3.6 million, respectively, at ESI. Margins
increased at ESI in the first six months of 1997 compared to the same
period in 1996.
OTHER EXPENSES
Other operating expenses at the Company decreased $3.7 million, or
4.7%.
Other operating expenses at WPSC decreased $8.8 million, or 11.5%.
This decrease was due to lower customer service expenses of
$3.2 million, lower administrative expenses of $1.5 million due
primarily to reduced post-retirement medical and dental expenses, and
lower generation operating expenses of $3.9 million resulting from
completion in 1996 of the retail amortization related to a deferred
coal and rail contract settlement.
Other operating expenses at ESI increased $2.2 million, or 106.2%, due
to expansion of the business.
Other operating expenses at PDI increased $2.0 million as a result of
expansion of the business and initial operation of the
Stoneman Power Plant. Other operating expenses also increased at the
Company.
Depreciation and decommissioning expenses increased $5.1 million, or
15.7%, largely due to the accelerated recovery of investment in
Kewaunee and accelerated funding of Kewaunee decommissioning costs.
Other income increased $3.6 million, or 111.8% due primarily to gains
on sales of non-utility property at WPSC which represented
approximately $.07 per share.
Income tax expense decreased $3.5 million due primarily to lower
earnings.
-22-
<PAGE>
FINANCIAL CONDITION
Most of the Company's capital expenditures relate to WPSC's
construction expenditures. WPSC requires large investments in capital
assets used to deliver electric and gas services. WPSC maintains good
liquidity levels and a financial condition considered to be strong by
utility analysts. Internally generated funds exceeded WPSC's cash
requirements resulting in the reduction of short-term borrowings
during the first six months of 1997. No funding difficulties are
anticipated in the future. Pretax interest coverage was 3.25 times
for the 12 months ended June 30, 1997 for the Company and 4.14 times
for WPSC.
WPSC's bond ratings are AA+ (Standard & Poor's and Duff & Phelps) and
Aa2 (Moody's).
For the three-year period 1997 to 1999, internally generated funds
will provide all but $97.0 million of WPSC's $450.0 million in
construction expenditures and other investments. These expenditures
are comprised of $175.0 million for electric construction,
$29.0 million for nuclear fuel, $125.0 million for gas construction,
$57.0 million for other construction expenditures, and $64.0 million
for nuclear decommissioning. WPSC currently expects to finance any
shortfall in internally generated funds through short-term debt,
long-term debt, and common equity from the Company.
Anticipated investment expenditures for non-regulated subsidiaries
could be as high as $112.0 million for the three-year period 1997 to
1999 if projects develop as forecasted. Project non-recourse
financings will be pursued.
Effective March 20, 1997, WPSC received authorization from the PSCW to
begin deferring all costs associated with the repair of the Kewaunee
steam generators. The joint owners of Kewaunee will be requesting
rate recovery of these deferred costs in a future proceeding.
Approximately $2.5 million (WPSC's portion) has been deferred through
June 30, 1997. Repairs are complete, and Kewaunee returned to
operation in mid-June of 1997. The apparent success of these repairs
offers WPSC an option to the replacement of Kewaunee's steam
generators. WPSC has proposed replacing the steam generators and is
seeking approval from the PSCW for replacement in 1999. WPSC is not
withdrawing the steam generator replacement proposal at this time, but
will be reviewing economic analyses considering the success of the
newly developed repair process.
-23-
<PAGE>
Some areas of Wisconsin and the Upper Midwest region will be facing
unusual electric supply challenges over the next few months. Several
nuclear plants in Wisconsin and Illinois are temporarily out of
service due to a series of maintenance outages. Wisconsin utilities
are working together with the PSCW to assure adequate power supplies.
On July 1, 1997, the PSCW authorized WPSC to defer all advertising
costs associated with developing a communication plan to educate
customers on the potential energy shortage. WPSC was also authorized
to defer all costs related to returning its fossil fuel plant, Pulliam
Unit 3, to service and all subsequent operating costs for Pulliam
Unit 3. The recovery of these deferred costs will be considered in a
future rate proceeding. Expenditures to date have been minimal and no
deferrals for these items have yet been recorded.
WPSC filed an application proposing a $.00082 per Kwh increase to
electric retail rates with the PSCW on July 3, 1997. WPSC's fuel
costs exceeded the costs provided for under the fuel rules which allow
rate filings to recover these additional costs. WPSC has requested
the PSCW to issue an order in August of 1997.
In the first quarter of 1997, WPSC received a portion of the
$12.0 million manufactured gas plant remediation insurance settlements
that it anticipates to receive in 1997. Insurance recoveries are
being deferred and will offset future remediation costs as the PSCW
prescribes in future rate proceedings.
-24-
<PAGE>
<PAGE>
Part II. OTHER INFORMATION
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
Proxy voting results for the election of three directors to the
Company's Board at the May 1, 1997 Annual Shareholders' Meeting are as
follows:
For Abstentions Non-Votes Total
---------- ----------- --------- ----------
Michael S. Ariens 21,440,652 433,731 2,022,579 23,896,962
Kathryn M.
Hasselblad-Pascale 21,443,004 431,379 2,022,579 23,896,962
Larry L. Weyers 21,453,009 420,397 2,023,556 23,896,962
The following directors also continued in office after the Annual
Shareholders' Meeting:
A. Dean Arganbright
Richard A. Bemis
Daniel A. Bollom
Sister M. Lois Bush
Robert C. Gallagher
James L. Kemerling
ITEM 5. OTHER INFORMATION
WPS RESOURCES CORPORATION - UPPER PENINSULA ENERGY CORPORATION MERGER
WPS Resources Corporation ("WPSR") and Upper Peninsula Energy
Corporation ("UPEN") announced on July 10, 1997 that they have entered
into an Agreement and Plan of Merger pursuant to which UPEN will merge
with and into WPSR. The transaction will be structured as a tax-free,
stock-for-stock exchange. Pursuant to the merger agreement, holders
of UPEN common stock will receive 0.9 shares of WPSR common stock for
each share of UPEN common stock owned.
The merger is subject to (i) approval by the shareholders of UPEN;
(ii) approval by the Federal Energy Regulatory Commission; (iii) the
Form S-4 Registration Statement of WPSR being declared effective by
-25-
<PAGE>
the Securities and Exchange Commission;(iv) expiration or termination
of the waiting period applicable to the merger under the
Hart-Scott-Rodino Antitrust Improvements Act of 1976; (v) receipt by
the parties of an opinion of counsel that the exchange of stock
qualifies as a tax-free transaction; (vi) receipt by the parties of
appropriate assurances that the transaction will be accounted for as a
pooling of interests; and (vii) the satisfaction of various other
conditions.
The merger is expected to be completed in 1998 at which time UPEN will
be merged with and into WPSR and the Upper Peninsula Power Company,
UPEN's utility subsidiary, will become a wholly-owned subsidiary of
WPSR. At the same time, the Board of Directors of WPSR will be
expanded from nine to ten members to include one director nominated by
UPEN.
KEWAUNEE NUCLEAR POWER PLANT STEAM GENERATOR STRATEGY
The Kewaunee Nuclear Power Plant ("Kewaunee") returned to service on
June 12, 1997 after having been out of service since September 21,
1997 for routine maintenance and repair of steam generators. Kewaunee
is jointly owned by Wisconsin Public Service Corporation, Wisconsin
Power and Light Company, and Madison Gas and Electric Company.
Kewaunee is operated by Wisconsin Public Service Corporation ("WPSC"),
the utility subsidiary of WPSR.
WPSC has proposed replacing the two steam generators at Kewaunee and
is seeking permission from the Public Service Commission of Wisconsin
("PSCW") to undertake the replacement work in 1999. WPSC will not be
withdrawing the replacement proposal at this time, but will use the
time provided by the apparent success of the steam generator repairs
to assess future alternatives with respect to a steam generator
strategy. This evaluation of an alternative course of action is
particularly appropriate in light of the uncertainties inherent in
utility industry restructuring, the continuing ownership discussions
between the Kewaunee owners, the success of the recent repairs, and
information to be gained from the next inspection of the steam
generators at the time of the next shutdown which is scheduled for the
fall of 1998.
The availability of steam generator resleeving as a future repair
option does not mean that the steam generators will not be replaced
sometime in the future. At this time, it is felt that the resleeving
alternative must be evaluated very carefully along with other
-26-
<PAGE>
alternatives before making any decisions with respect to the future of
the current steam generators.
Background information regarding Kewaunee steam generator repair
problems is set forth in the registrants' Annual Report on Form 10-K
for the year ended December 31, 1996, Current Report on Form 8-K dated
March 10, 1997, Quarterly Report on Form 10-Q for the quarterly period
ended March 31, 1997, and Current Report on Form 8-K dated
June 7, 1997.
SUMMER ELECTRIC ENERGY SUPPLY
Should the upper Midwest region of the United States experience
extended periods of hot weather, widespread damaging storms, or
unusual generating plant or transmission system constraints during the
summer of 1997, the state of Wisconsin could potentially experience
electricity shortages. At its open meeting on April 24, 1997, the
PSCW approved an electric system reliability emergency plan that would
be implemented should such circumstances occur. The plan requires
that the eastern Wisconsin utilities, including WPSC, share their
capacity reserves in time of emergency. Major nuclear generating
units have been or are out of service in Illinois, Minnesota, and
Wisconsin. Wisconsin routinely imports about 15% of its electricity
from other states. Due to transmission system constraints, the
eastern and central sections of the state of Wisconsin would most
likely be affected by electricity shortages. WPSC and other members
of the Wisconsin Reliability Assessment Group, consisting of seven
public utilities, are working with the PSCW, other government
agencies, large industrial customers, and other groups in an attempt
to mitigate the impact of potential electric system reliability
problems. The return of the Kewaunee Nuclear Power Plant to service
on June 12, 1997 significantly increased the amount of generation
available during the summer of 1997, but the potential for shortages
still exists.
-27-
<PAGE>
<PAGE>
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) EXHIBITS
The following documents are filed herewith:
Exhibit 10.5 Deferred Compensation Plan
WPS Resources Corporation
Exhibit 10.6 Executive Employment and Severance
Agreement
WPS Resources Corporation
Exhibit 11 Statement Regarding Computation of Per
Share Earnings
WPS Resources Corporation
Exhibit 27 Financial Data Schedule
WPS Resources Corporation
Wisconsin Public Service Corporation
(b) REPORT ON FORM 8-K
A current report on Form 8-K dated June 7, 1997
reporting on the return to service of the
Kewaunee Nuclear Power Plant.
WPS Resources Corporation
Wisconsin Public Service Corporation
-28-
<PAGE>
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant, WPS Resources Corporation, has duly caused this report
to be signed on its behalf by the undersigned thereunto duly
authorized.
WPS Resources Corporation
Date: July 25, 1997 /s/ Diane Ford
________________________________
D. L. Ford
Controller and Chief
Accounting Officer
(Duly Authorized Officer and
Chief Accounting Officer)
-29-
<PAGE>
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant, Wisconsin Public Service Corporation, has duly caused
this report to be signed on its behalf by the undersigned thereunto
duly authorized.
Wisconsin Public Service Corporation
Date: July 25, 1997 /s/ Diane Ford
________________________________
D. L. Ford
Controller
(Duly Authorized Officer and
Chief Accounting Officer)
-30-
<PAGE>
<PAGE>
WPS RESOURCES CORPORATION AND
WISCONSIN PUBLIC SERVICE CORPORATION
EXHIBIT INDEX TO FORM 10-Q
FOR THE QUARTER ENDED JUNE 30, 1997
Exhibit No. Description
___________ ___________
10.5 Deferred Compensation Plan
WPS Resources Corporation
10.6 Executive Employment and Severance Agreement
WPS Resources Corporation
11 Statement Regarding Computation of Per Share Earnings
WPS Resources Corporation
27 Financial Data Schedule
WPS Resources Corporation
Wisconsin Public Service Corporation
-31-
<PAGE>
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