______________________________________________________________________________
______________________________________________________________________________
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, 1998
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
920-433-1466
1-3016 WISCONSIN PUBLIC SERVICE CORPORATION 39-0715160
(A Wisconsin Corporation)
700 North Adams Street
P. O. Box 19001
Green Bay, WI 54307-9001
920-433-1466
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
April 24, 1998
WISCONSIN PUBLIC SERVICE CORPORATION Common stock, $4 par value,
23,896,962 shares outstanding at
April 24, 1998
______________________________________________________________________________
______________________________________________________________________________
<PAGE>
WPS RESOURCES CORPORATION
AND
WISCONSIN PUBLIC SERVICE CORPORATION
FORM 10-Q FOR THE QUARTER ENDED MARCH 31, 1998
CONTENTS
Page
FORWARD-LOOKING STATEMENTS 3
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
WPS RESOURCES CORPORATION
Consolidated Statements of Income and
Retained Earnings 4
Consolidated Balance Sheets 5
Consolidated Statements of Capitalization 6
Consolidated Statements of Cash Flows 7
WISCONSIN PUBLIC SERVICE CORPORATION
Consolidated Statements of Income 8
Consolidated Balance Sheets 9
Consolidated Statements of Capitalization 10
Consolidated Statements of Cash Flows 11
Consolidated Statements of Retained Earnings 12
CONDENSED NOTES TO FINANCIAL STATEMENTS OF
WPS Resources Corporation and
Wisconsin Public Service Corporation 13 - 14
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations for
WPS Resources Corporation and
Wisconsin Public Service Corporation 15 - 19
PART II. OTHER INFORMATION
Item 5. Other Information 20 - 22
Item 6. Exhibits and Reports on Form 8-K 23
Signatures 24 - 25
EXHIBIT INDEX 26
Exhibit 11 Statement Regarding Computation of Per Share
Earnings
WPS Resources Corporation
Exhibit 27 Financial Data Schedule
WPS Resources Corporation
Wisconsin Public Service Corporation
-2-
<PAGE>
FORWARDING-LOOKING STATEMENTS
This report includes forward-looking statements within the meaning of
Section 21E of the Securities Exchange Act of 1934, as amended. The
statements speak of plans, goals, beliefs, or expectations of WPS Resources
Corporation ("WPSR") and Wisconsin Public Service Corporation ("WPSC"), refer
to estimates, or use similar terms. Although WPSR and WPSC believe that their
expectations are based on reasonable assumptions, actual results may differ
materially from those in the forward-looking statements included in this
report for reasons that include: the speed and degree to which competition
enters the electric and natural gas industries; state and federal legislative
and regulatory initiatives that increase competition, affect cost and
investment recovery, and have an impact on rate structures; the economic
climate and industrial, commercial, and residential growth in areas served by
WPSC and WPS Energy Services, Inc. ("ESI") (WPSR's wholly-owned nonregulated
energy marketing subsidiary); the weather and other natural phenomena; the
timing and extent of changes in commodity prices and interest rates;
conditions in the capital markets; and growth in opportunities for ESI and
WPS Power Development, Inc. (WPSR's wholly-owned nonregulated electric power
development and energy service subsidiary).
A forward-looking statement speaks only as of the date on which such
statement is made, and neither WPSR nor WPSC undertakes to update any
forward-looking statement to reflect events or circumstances after the date on
which such statement is made or to reflect the occurrence of unanticipated
events which affect such forward-looking statements. New factors emerge from
time to time, and it is not possible for WPSR or WPSC to predict all such
factors, nor can it assess the impact of each such factor or the extent to
which any factor, or combination of factors, may cause results to differ
materially from those contained in any forward-looking statement.
-3-
<PAGE>
<TABLE>
Part I. FINANCIAL INFORMATION
Item 1. Financial Statements
WPS RESOURCES CORPORATION
<CAPTION>
============================================================================================
CONSOLIDATED STATEMENTS OF INCOME AND RETAINED EARNINGS Three Months Ended
(Thousands, except per share amounts) March 31
1998 1997
============================================================================================
<S> <C> <C>
Operating revenues
Electric utility $112,806 $122,964
Gas utility 65,484 84,580
Nonregulated energy and other 98,519 55,469
- --------------------------------------------------------------------------------------------
Total operating revenues 276,809 263,013
============================================================================================
Operating expenses
Electric production fuels 25,618 27,145
Purchased power 8,165 14,156
Gas purchased for resale 43,010 61,513
Nonregulated energy cost of sales 96,488 54,360
Other operating expenses 35,728 38,235
Maintenance 9,938 9,468
Depreciation and decommissioning 20,115 17,927
Taxes other than income 6,812 6,939
- --------------------------------------------------------------------------------------------
Total operating expenses 245,874 229,743
============================================================================================
Operating income 30,935 33,270
- --------------------------------------------------------------------------------------------
Other income
Allowance for equity funds used during construction 29 35
Other, net 2,304 1,148
- --------------------------------------------------------------------------------------------
Total other income 2,333 1,183
============================================================================================
Income before interest expense 33,268 34,453
- --------------------------------------------------------------------------------------------
Interest on long-term debt 5,398 5,524
Other interest 729 1,028
Allowance for borrowed funds used during construction (11) (34)
- --------------------------------------------------------------------------------------------
Total interest expense 6,116 6,518
============================================================================================
Income before income taxes 27,152 27,935
Income taxes 9,485 9,203
Minority interest (212) (281)
Preferred stock dividends of subsidiary 778 778
- --------------------------------------------------------------------------------------------
Net income 17,101 18,235
- --------------------------------------------------------------------------------------------
Other comprehensive income - -
- --------------------------------------------------------------------------------------------
Comprehensive income 17,101 18,235
============================================================================================
Retained earnings at beginning of period 319,654 311,794
Cash dividends on common stock 11,590 11,351
- --------------------------------------------------------------------------------------------
Retained earnings at end of period $325,165 $318,678
============================================================================================
Average shares of common stock 23,862 23,880
Basic and diluted earnings per average share of common stock $0.72 $0.76
Dividend per share of common stock $0.485 $0.475
============================================================================================
</TABLE>
The accompanying notes are an integral part of these statements.
-4-
<PAGE>
<TABLE>
WPS RESOURCES CORPORATION
<CAPTION>
======================================================================================================
CONSOLIDATED BALANCE SHEETS March 31 December 31
(Thousands) 1998 1997
======================================================================================================
<S> <C> <C>
ASSETS
- ------------------------------------------------------------------------------------------------------
Utility plant
Electric $1,509,712 $1,506,470
Gas 252,645 251,603
- ------------------------------------------------------------------------------------------------------
Total 1,762,357 1,758,073
Less - Accumulated depreciation and decommissioning 1,057,100 1,032,149
- ------------------------------------------------------------------------------------------------------
Total 705,257 725,924
Nuclear decommissioning trusts 146,331 134,108
Construction in progress 10,377 7,266
Nuclear fuel, less accumulated amortization 17,620 19,062
- ------------------------------------------------------------------------------------------------------
Net utility plant 879,585 886,360
======================================================================================================
Current assets
Cash and equivalents 20,395 6,424
Customer and other receivables, net of reserves 104,763 87,709
Accrued utility revenues 27,929 30,750
Fossil fuel, at average cost 12,674 10,336
Gas in storage, at average cost 4,325 22,080
Materials and supplies, at average cost 19,223 18,793
Prepayments and other 16,508 20,499
- ------------------------------------------------------------------------------------------------------
Total current assets 205,817 196,591
======================================================================================================
Regulatory assets 76,688 78,544
Net nonutility and nonregulated plant 21,805 19,194
Investments and other assets 122,847 118,913
======================================================================================================
Total $1,306,742 $1,299,602
======================================================================================================
CAPITALIZATION AND LIABILITIES
- ------------------------------------------------------------------------------------------------------
Capitalization
Common stock equity $ 482,959 $ 477,823
Preferred stock of subsidiary
with no mandatory redemption 51,200 51,200
Long-term debt 304,461 304,008
- ------------------------------------------------------------------------------------------------------
Total capitalization 838,620 833,031
======================================================================================================
Current liabilities
Notes payable 10,511 10,000
Commercial paper 11,600 20,706
Accounts payable 84,575 85,651
Accrued taxes 3,883 3,514
Accrued interest 4,956 7,801
Other 20,350 9,536
- ------------------------------------------------------------------------------------------------------
Total current liabilities 135,875 137,208
======================================================================================================
Long-term liabilities and deferred credits
Accumulated deferred income taxes 125,323 125,804
Accumulated deferred investment credits 26,466 26,901
Regulatory liabilities 52,567 50,279
Environmental remediation liabilities 40,080 40,215
Other long-term liabilities 87,811 86,164
- ------------------------------------------------------------------------------------------------------
Total long-term liabilities and deferred credits 332,247 329,363
======================================================================================================
Total $1,306,742 $1,299,602
======================================================================================================
</TABLE>
The accompanying notes are an integral part of these statements.
-5-
<PAGE>
<TABLE>
WPS RESOURCES CORPORATION
<CAPTION>
=======================================================================================================
CONSOLIDATED STATEMENTS OF CAPITALIZATION March 31 December 31
(Thousands, except share amounts) 1998 1997
=======================================================================================================
<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 325,165 319,654
Shares in deferred compensation trust, 37,390 and 33,430 shares
at average cost of $29.32 and $28.44 per share at
March 31, 1998 and December 31, 1997, respectively. (1,097) (951)
ESOP loan guarantees (10,027) (9,798)
- -------------------------------------------------------------------------------------------------------
Total common stock equity 482,959 477,823
=======================================================================================================
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 (868) (890)
- -------------------------------------------------------------------------------------------------------
Total first mortgage bonds 283,307 283,285
- -------------------------------------------------------------------------------------------------------
ESOP loan guarantees 10,027 9,798
Notes payable to bank, secured by nonregulated plant 10,912 10,710
Other long-term debt 215 215
- -------------------------------------------------------------------------------------------------------
Total long-term debt 304,461 304,008
=======================================================================================================
Total capitalization $838,620 $833,031
=======================================================================================================
</TABLE>
The accompanying notes are an integral part of these statements.
-6-
<PAGE>
<TABLE>
WPS RESOURCES CORPORATION
<CAPTION>
============================================================================================
CONSOLIDATED STATEMENTS OF CASH FLOWS Three Months Ended
(Thousands) March 31
1998 1997
============================================================================================
<S> <C> <C>
Cash flows from operating activities
Net income $ 17,101 $ 18,235
Adjustments to reconcile net income to net cash from
operating activities
Depreciation and decommissioning 20,115 17,927
Amortization of nuclear fuel and other 4,386 1,554
Deferred income taxes (1,449) (2,313)
Investment tax credit restored (435) (442)
Allowance for equity funds used during construction (29) (35)
Pension income (2,334) (3,092)
Postretirement liability 1,019 1,788
Deferred demand-side management expenditures - (7)
Other, net 1,462 9,021
Changes in
Customer and other receivables (17,054) 10,424
Accrued utility revenues 2,821 8,091
Fossil fuel inventory (2,338) (300)
Gas in storage 17,755 17,110
Accounts payable (1,076) (35,830)
Miscellaneous current and accrued liabilities 11,174 8,995
Accrued taxes 369 9,945
Gas refunds (360) 9
- --------------------------------------------------------------------------------------------
Net cash from operating activities 51,127 61,080
============================================================================================
Cash flows from (used for) investing activities
Construction of utility plant and nuclear fuel expenditures (10,155) (11,540)
Purchase of other property and equipment (3,386) (996)
Decommissioning funding (4,126) (3,130)
Other 465 (555)
- --------------------------------------------------------------------------------------------
Net cash used for investing activities (17,202) (16,221)
============================================================================================
Cash flows from (used for) financing activities
Issuance of notes payable 32,311 18,075
Redemption of notes payable (31,800) (27,075)
Issuance of other long-term debt 377 237
Issuance of commercial paper 321,137 236,996
Redemption of commercial paper (330,243) (263,346)
Cash dividends on common stock (11,590) (11,351)
Purchase of deferred compensation stock (146) (153)
- --------------------------------------------------------------------------------------------
Net cash used for financing activities (19,954) (46,617)
============================================================================================
Net increase (decrease) in cash and equivalents 13,971 (1,758)
Cash and equivalents at beginning of period 6,424 5,978
============================================================================================
Cash and equivalents at end of period $ 20,395 $ 4,220
============================================================================================
Cash paid during period for
Interest, less amount capitalized $ 8,300 $ 8,672
Income taxes 10,304 2,215
Preferred stock dividends of subsidiary 778 778
============================================================================================
</TABLE>
The accompanying notes are an integral part of these statements.
-7-
<PAGE>
<TABLE>
WISCONSIN PUBLIC SERVICE CORPORATION
<CAPTION>
============================================================================================
CONSOLIDATED STATEMENTS OF INCOME Three Months Ended
(Thousands) March 31
1998 1997
============================================================================================
<S> <C> <C>
Operating revenues
Electric $112,806 $122,964
Gas 65,484 84,580
- --------------------------------------------------------------------------------------------
Total operating revenues 178,290 207,544
============================================================================================
Operating expenses
Electric production fuels 25,618 27,145
Purchased power 8,165 14,156
Gas purchased for resale 42,394 61,513
Other operating expenses 32,515 34,003
Maintenance 9,938 9,468
Depreciation and decommissioning 19,642 17,528
Federal income taxes 8,296 8,670
Investment tax credit restored (436) (442)
State income taxes 2,257 2,770
Gross receipts tax and other 6,786 6,931
- --------------------------------------------------------------------------------------------
Total operating expenses 155,175 181,742
============================================================================================
Operating income 23,115 25,802
- --------------------------------------------------------------------------------------------
Other income and (deductions)
Allowance for equity funds used during construction 29 35
Other, net 1,820 1,406
Income taxes (281) (32)
- --------------------------------------------------------------------------------------------
Total other income and (deductions) 1,568 1,409
============================================================================================
Income before interest expense 24,683 27,211
- --------------------------------------------------------------------------------------------
Interest expense
Interest on long-term debt 5,480 5,634
Other interest 545 854
Allowance for borrowed funds used during construction (11) (34)
- --------------------------------------------------------------------------------------------
Total interest expense 6,014 6,454
============================================================================================
Net income 18,669 20,757
Preferred stock dividend requirements 778 778
- --------------------------------------------------------------------------------------------
Earnings on common stock $ 17,891 $ 19,979
============================================================================================
</TABLE>
The accompanying notes are an integral part of these statements.
-8-
<PAGE>
<TABLE>
WISCONSIN PUBLIC SERVICE CORPORATION
<CAPTION>
==================================================================================================
CONSOLIDATED BALANCE SHEETS March 31 December 31
(Thousands) 1998 1997
==================================================================================================
<S> <C> <C>
ASSETS
- --------------------------------------------------------------------------------------------------
Utility plant
Electric $1,509,712 $1,506,470
Gas 252,645 251,603
- --------------------------------------------------------------------------------------------------
Total 1,762,357 1,758,073
Less - Accumulated depreciation and decommissioning 1,057,100 1,032,149
- --------------------------------------------------------------------------------------------------
Total 705,257 725,924
Nuclear decommissioning trusts 146,331 134,108
Construction in progress 10,377 7,266
Nuclear fuel, less accumulated amortization 17,620 19,062
- --------------------------------------------------------------------------------------------------
Net utility plant 879,585 886,360
==================================================================================================
Current assets
Cash and equivalents 19,295 3,921
Customer and other receivables, net of reserves 58,739 55,893
Accrued utility revenues 27,929 30,750
Fossil fuel, at average cost 12,309 9,964
Gas in storage, at average cost 3,810 17,194
Materials and supplies, at average cost 19,223 18,793
Prepayments and other 15,409 20,155
- --------------------------------------------------------------------------------------------------
Total current assets 156,714 156,670
==================================================================================================
Regulatory assets 76,688 78,544
Net nonutility plant 2,896 2,972
Investments and other assets 113,305 109,408
==================================================================================================
Total $1,229,188 $1,233,954
==================================================================================================
CAPITALIZATION AND LIABILITIES
- --------------------------------------------------------------------------------------------------
Capitalization
Common stock equity $ 463,193 $ 457,121
Preferred stock with no mandatory redemption 51,200 51,200
Long-term debt to parent 14,258 14,321
Long-term debt 293,549 293,298
- --------------------------------------------------------------------------------------------------
Total capitalization 822,200 815,940
==================================================================================================
Current liabilities
Note payable 10,000 10,000
Commercial paper - 15,500
Accounts payable 41,577 46,453
Accrued taxes 3,883 3,514
Accrued interest 4,956 7,801
Other 19,082 10,049
- --------------------------------------------------------------------------------------------------
Total current liabilities 79,498 93,317
==================================================================================================
Long-term liabilities and deferred credits
Accumulated deferred income taxes 127,115 127,512
Accumulated deferred investment tax credits 26,466 26,901
Regulatory liabilities 52,567 50,279
Environmental remediation liabilities 40,080 40,215
Other long-term liabilities 81,262 79,790
- --------------------------------------------------------------------------------------------------
Total long-term liabilities and deferred credits 327,490 324,697
==================================================================================================
Total $1,229,188 $1,233,954
==================================================================================================
</TABLE>
The accompanying notes are an integral part of these statements.
-9-
<PAGE>
<TABLE>
WISCONSIN PUBLIC SERVICE CORPORATION
<CAPTION>
========================================================================================================
CONSOLIDATED STATEMENTS OF CAPITALIZATION March 31 December 31
(Thousands, except share amounts) 1998 1997
========================================================================================================
<S> <C> <C>
Common stock equity
Common stock $ 95,588 $ 95,588
Premium on capital stock 73,842 73,842
Retained earnings 303,790 297,489
ESOP loan guarantees (10,027) (9,798)
- --------------------------------------------------------------------------------------------------------
Total common stock equity 463,193 457,121
========================================================================================================
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 5,888 5,914
7.35% 2016 8,370 8,407
- --------------------------------------------------------------------------------------------------------
Total long-term debt to parent 14,258 14,321
========================================================================================================
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 (868) (890)
- --------------------------------------------------------------------------------------------------------
Total first mortgage bonds 283,307 283,285
- --------------------------------------------------------------------------------------------------------
ESOP loan guarantees 10,027 9,798
Other long-term debt 215 215
- --------------------------------------------------------------------------------------------------------
Total long-term debt 293,549 293,298
========================================================================================================
Total capitalization $822,200 $815,940
========================================================================================================
</TABLE>
The accompanying notes are an integral part of these statements.
-10-
<PAGE>
<TABLE>
WISCONSIN PUBLIC SERVICE CORPORATION
<CAPTION>
============================================================================================
CONSOLIDATED STATEMENTS OF CASH FLOWS Three Months Ended
(Thousands) March 31
1998 1997
============================================================================================
<S> <C> <C>
Cash flows from operating activities
Net income $ 18,669 $ 20,757
Adjustments to reconcile net income to net cash from
operating activities
Depreciation and decommissioning 19,642 17,528
Amortization of nuclear fuel and other 4,366 1,550
Deferred income taxes (1,365) (2,314)
Investment tax credit restored (435) (442)
Allowance for equity funds used during construction (29) (35)
Pension income (2,334) (3,092)
Postretirement liability 1,019 1,788
Deferred demand-side management expenditures - (7)
Other, net 4,404 8,371
Changes in
Customer and other receivables (2,846) (8,616)
Accrued utility revenues 2,821 8,031
Fossil fuel inventory (2,345) (200)
Gas in storage 13,384 14,033
Accounts payable (4,876) (17,159)
Miscellaneous current and accrued liabilities 7,127 10,206
Accrued taxes 369 9,947
Gas refunds (360) 9
- --------------------------------------------------------------------------------------------
Net cash from operating activities 57,211 60,355
============================================================================================
Cash flows from (used for) investing activities
Construction of utility plant and nuclear fuel expenditures (10,155) (11,540)
Decommissioning funding (4,126) (3,130)
Purchase of other property and equipment - (307)
Other 312 (1,347)
- --------------------------------------------------------------------------------------------
Net cash from (used for) investing activities (13,969) (16,324)
============================================================================================
Cash flows from (used for) financing activities
Proceeds from issuance of commercial paper 47,000 94,000
Redemption of commercial paper (62,500) (118,000)
Preferred stock dividends (778) (778)
Common stock dividends (11,590) (11,351)
Dividend to parent - (10,000)
- --------------------------------------------------------------------------------------------
Net cash from (used for) financing activities (27,868) (46,129)
============================================================================================
Net increase (decrease) in cash and equivalents 15,374 (2,098)
Cash and equivalents at beginning of period 3,921 4,165
============================================================================================
Cash and equivalents at end of period $ 19,295 $ 2,067
============================================================================================
Cash paid during period for
Interest, less amount capitalized $ 8,439 $ 8,512
Income taxes 9,991 2,205
============================================================================================
</TABLE>
The accompanying notes are an integral part of these statements.
-11-
<PAGE>
<TABLE>
WISCONSIN PUBLIC SERVICE CORPORATION
<CAPTION>
============================================================================================
CONSOLIDATED STATEMENTS OF RETAINED EARNINGS Three Months Ended
(Thousands) March 31
1998 1997
============================================================================================
<S> <C> <C>
Balance at beginning of period $297,489 $291,740
Add Net income 18,669 20,757
- --------------------------------------------------------------------------------------------
316,158 312,497
- --------------------------------------------------------------------------------------------
Deduct
Cash dividends declared on preferred stock 778 778
Dividends declared on common stock 11,590 11,351
Dividend to parent - 10,000
- --------------------------------------------------------------------------------------------
12,368 22,129
- --------------------------------------------------------------------------------------------
Balance at end of period $303,790 $290,368
============================================================================================
</TABLE>
The accompanying notes are an integral part of these statements.
-12-
<PAGE>
WPS RESOURCES CORPORATION AND SUBSIDIARIES
WISCONSIN PUBLIC SERVICE CORPORATION
CONDENSED NOTES TO FINANCIAL STATEMENTS
March 31, 1998
NOTE 1. FINANCIAL INFORMATION
______________________________
The foregoing consolidated financial statements have been prepared by
WPS Resources Corporation ("WPSR") 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. WPSR and
WPSC believe that the disclosures made are adequate to make the information
presented not misleading. These financial statements should be read in
conjunction with the financial statements and notes thereto included in WPSR's
and WPSC's latest annual report on Form 10-K.
Because of the seasonal nature of WPSC's operations, interim results are not
necessarily indicative of annual results.
NOTE 2. SEGMENT DISCLOSURES
____________________________
In June 1997, the Financial Accounting Standards Board 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. WPSR
will be adopting the requirements of this statement at year-end 1998, has not
yet determined the segments which will be disclosed, and has not yet
determined the impact of adopting this statement.
NOTE 3. COSTS OF START-UP ACTIVITIES
_____________________________________
In April 1998, the American Institute of Certified Public Accountants issued
Statement of Position 98-5, "Reporting on the Costs of Start-up Activities."
This statement provides guidance on the financial reporting of start-up costs
and organization costs. Costs of start-up activities and organization costs
are required to be expensed as incurred. The statement is effective for
periods beginning after December 15, 1998. WPSR will be adopting the
requirements of this statement in 1999 and does not anticipate any material
impact to its financial statements.
NOTE 4. AGREEMENT TO MERGE WITH UPPER PENINSULA ENERGY CORPORATION
__________________________________________________________________
On July 10, 1997, WPSR announced an agreement to merge with Upper Peninsula
Energy Corporation ("UPEN"). The S-4 Registration Statement was declared
-13-
<PAGE>
effective by the SEC on December 5, 1997. The shareholders of UPEN approved
the merger on January 29, 1998. The merger is subject to (1) approval by the
Federal Energy Regulatory Commission; (2) approval by the SEC under the Public
Utility Holding Company Act of 1935; (3) the expiration or termination of the
waiting period applicable to the merger under the Hart-Scott-Rodino Antitrust
Improvements Act of 1976; (4) receipt by the parties of an opinion of counsel
that the exchange of stock qualifies as a tax-free transaction; (5) receipt by
the parties of appropriate assurances that the transaction will be accounted
for as a pooling of interests; and (6) the satisfaction of various other
conditions. The merger is expected to be completed in the second half of
1998. UPEN will merge with and into WPSR, and Upper Peninsula Power Company,
UPEN's utility subsidiary, will become a wholly-owned subsidiary of WPSR.
The summary below contains selected unaudited pro forma financial data for the
quarter ended March 31, 1998. The financial data should be read in
conjunction with the historical WPSR and UPEN consolidated financial
statements and related notes. The pro forma combined earnings per share
reflect the issuance of shares associated with the merger agreement and the
related dilutive effect. The pro forma combined data accounts for the merger
as a pooling of interests.
Under the terms of the merger agreement, each of the 2,950,001 outstanding
shares of UPEN common stock (no par value) will be converted into 0.90 shares
of WPSR common stock ($1.00 par value), subject to adjustment for fractional
shares.
<TABLE>
<CAPTION>
===============================================================================================
Pro Forma
WPSR UPEN Combined
(In thousands, except per share data) (as reported) (as reported) (unaudited)
- -----------------------------------------------------------------------------------------------
<S> <C> <C> <C>
QUARTER ENDING MARCH 31, 1998
Operating revenues $ 276,809 $ 15,573 $ 292,382
Net income $ 17,101 $ 851 $ 17,952
Basic and diluted earnings per share $0.72 $0.29 $0.68
AT MARCH 31, 1998
Assets $1,306,742 $135,260 $1,441,529
Long-term obligations $ 304,461 $ 43,006 $ 347,467
===============================================================================================
</TABLE>
-14-
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
WPSR is a holding company. Approximately 94% of WPSR's assets at March 31,
1998 and approximately 64% of WPSR's revenues and all of its net income for
the first quarter of 1998 were derived from WPSC, an electric and gas utility.
WPSR's wholly-owned subsidiaries include a regulated utility, WPSC, and two
nonregulated subsidiaries, WPS Energy Services, Inc. ("ESI") and WPS Power
Development, Inc. ("PDI").
FIRST QUARTER 1998 COMPARED WITH FIRST QUARTER 1997
WPS RESOURCES CORPORATION OVERVIEW
Revenues at WPSR increased from $263.0 million in the first quarter of 1997 to
$276.8 million in the first quarter of 1998, or 5.2%. Net income decreased
6.0%, from $18.2 million in 1997 to $17.1 million in 1998. Basic and diluted
earnings per share decreased 5.3%, from $.76 in 1997 to $.72 in 1998. The
primary reasons for the decrease in earnings at WPSR were decreased electric
margins due to the February 21, 1997, implementation of a Public Service
Commission of Wisconsin ("PSCW") rate order, decreased gas margins at WPSC due
to extremely mild winter weather in the first quarter of 1998, and increased
depreciation and decommissioning expenses. Partially offsetting these
decreases in earnings were an increase in nonregulated gas margins and a
decrease in other operating expenses.
Earnings on common stock of WPSC were $17.9 million in 1998 and $20.0 million
in 1997. Nonregulated losses were $0.3 million in 1998 and $1.8 million in
1997. The decrease in nonregulated losses was due primarily to a $2.0 million
dividend on a venture capital investment received by WPSR.
WISCONSIN PUBLIC SERVICE CORPORATION OVERVIEW
Revenues at WPSC were $178.3 million in 1998 compared with $207.5 million in
1997, a decrease of 14.1%. Earnings on common stock decreased 10.5%, from
$20.0 million in 1997 to $17.9 million in 1998. The primary reasons for the
decrease in earnings on common stock at WPSC were decreases in electric and
gas margins as described above. Partially offsetting these decreases in
margins was a decrease in other operating expenses.
ELECTRIC UTILITY OPERATIONS
Electric margins decreased $2.6 million, or 3.2%, despite relatively stable
sales volumes. This decrease in margins was the result of implementation of a
PSCW rate order on February 21, 1997, which authorized an 8.1% electric
revenue reduction. This revenue reduction was effective for the entire first
quarter of 1998 but was effective for only the latter portion of the first
quarter of 1997.
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<PAGE>
First Quarter
--------------------------
Electric Margins (000's) 1998 1997
- ------------------------ ---- ----
Revenues $112,806 $122,964
Fuel and purchased power 33,783 41,301
------- -------
Margin $ 79,023 $ 81,663
======= =======
Sales in kilowatt-hours (000) 2,773,751 2,758,760
Electric revenues decreased $10.2 million, or 8.3%, as a result of the
electric rate reduction.
Electric production fuel expense decreased $1.5 million, or 5.6%, as a result
of decreased steam fuel expense of $2.5 million and decreased combustion
turbine generation expense of $0.8 million. Partially offsetting these
decreases was an increase in nuclear fuel expense of $1.7 million. The higher
fuel expense and generation expense in 1997 were necessitated by the loss of
production at WPSC's Kewaunee Nuclear Power Plant ("Kewaunee") which was out
of service for the first quarter of 1997 as the result of an extended outage
to repair steam generators. WPSC is the operator and 41.2% owner of Kewaunee.
Purchased power expense decreased $6.0 million, or 42.3%, due to decreased
purchase requirements in the first quarter of 1998. Purchase requirements in
the first quarter of 1997 were high due to lack of production at Kewaunee as a
result of an extended outage.
GAS UTILITY OPERATIONS
Gas margins decreased $0.6 million in the first quarter of 1998, or 2.6%, due
primarily to a 16.5% reduction in heating degree days.
First Quarter
------------------------
Gas Margins (000's) 1998 1997
- ------------------- ---- ----
Revenues $65,484 $84,580
Purchase costs 43,010 61,513
------ ------
Margin $22,474 $23,067
====== ======
Volume in therms (000) 223,804 251,172
Gas operating revenues decreased $19.1 million, or 22.6%. This decrease was
due primarily to unusually mild winter weather in the first quarter of 1998.
This decrease would have been greater but for the fact that gas operating
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revenues in the first quarter of 1997 reflected a one-time reduction of
$0.9 million (approximately $.02 per share after income tax effects) as a
result of a PSCW directive to change the accounting treatment for previous
customer line extensions.
Gas purchase costs decreased $18.5 million, or 30.1%. This decrease was due
to reduced customer demand and lower cost of gas as a result of the mild
winter weather during the first quarter of 1998. Under current regulatory
practice, the PSCW allows WPSC to pass changes in the cost of gas on to
customers through a purchased gas adjustment clause ("PGAC").
OTHER UTILITY EXPENSES/INCOME
Other operating expenses at WPSC decreased $1.5 million, or 4.4%. Cost saving
initiatives and decreased write-offs of customer accounts resulted in lower
customer service expense of $1.0 million. Administrative expenses decreased
$0.3 million due to cost saving measures and reduced postretirement medical
expense.
Maintenance expense increased $0.5 million, or 5.0%, as a result of increased
expenses of $0.6 million at WPSC's coal-fired plants. Decreased maintenance
expenses at Kewaunee partially offset this increase. Kewaunee was off-line
for extended maintenance in the first quarter of 1997.
Depreciation and decommissioning expense increased $2.1 million, or 12.1%, due
largely to the accelerated recovery of investment in Kewaunee and accelerated
funding of Kewaunee decommissioning costs. Accelerated recovery of investment
and funding began February 21, 1997, concurrent with the implementation of the
PSCW rate order.
Other income increased $0.4 million, or 29.5%, due primarily to the
amortization of interest income resulting from an income tax audit settlement.
OVERVIEW OF NONREGULATED OPERATIONS
Nonregulated operations primarily consist of the gas and electric sales of
ESI, an energy marketing subsidiary. Nonregulated operations also include PDI
which participates in the development of electric generation projects, invests
in generating projects, and provides services to the electric power generation
industry. Nonregulated operations experienced a loss of $0.3 million in 1998
compared with a loss of $1.7 million in 1997.
NONREGULATED MARGINS
Gas margins at ESI increased $1.7 million from $0.1 million in 1997 to
$1.8 million in 1998. Electric margins at ESI decreased $0.1 million in 1998.
Nonregulated energy and other operating revenues increased $43.1 million, or
77.6%. The increase in nonregulated energy revenues consisted largely of
increased gas sales at ESI of $40.3 million, or 75.3%, as a result of customer
growth and increased electric sales at ESI of $3.4 million, or 323.7%, also as
a result of customer growth. Revenues at PDI decreased $0.5 million due to
lower project revenues.
-17-
<PAGE>
Nonregulated energy cost of sales increased $42.1 million, or 77.5%, due
primarily to increased gas purchases and purchased power of $38.6 million and
$3.5 million, respectively, at ESI as a result of customer growth.
OTHER NONREGULATED EXPENSES/INCOME
Other nonregulated operating expenses decreased $1.0 million, or 24.1%. Other
operating expenses at ESI decreased $0.4 million, or 16.9%, due to fewer
write-offs of customer accounts. Other operating expenses at PDI decreased
$0.8 million, or 53.5%, due to lower project expenses. These decreases were
partially offset by an increase in operating expenses of $0.2 million at WPSR
due primarily to expenses associated with the UPEN merger.
Other income at WPSR included a dividend on a venture capital investment of
$2.0 million in 1998 and $0.2 million in 1997. Other income (losses) at the
nonregulated subsidiaries included trading losses at ESI of $1.6 million in
1998 and $0.2 million in 1997.
FINANCIAL CONDITION
Internally generated funds exceeded WPSR's cash requirements resulting in an
$8.6 million reduction in short-term borrowings during the first quarter of
1998. Pretax interest coverage was 4.45 times for the 12 months ended
March 31, 1998 for WPSC. WPSC's bond ratings are AA+ (Standard & Poor's and
Duff & Phelps) and Aa2 (Moody's).
WPSC makes large investments in capital assets. Construction expenditures for
WPSC are expected to continue in the $75.0 million to $90 million range
annually during the 1998 through 2000 period. This does not include
expenditures for the replacement of Kewaunee steam generators. Steam
generator replacement, WPSC's share of which would be approximately
$36.7 million in year of occurrence dollars, is contingent upon agreement
among the owners on a replacement plan. Potential expenditures for gas
pipeline laterals which would connect WPSC's distribution system with the
proposed Viking Voyageur pipeline from Canada are also not included due to
uncertainties relating to this proposal.
In addition, other capital requirements for WPSC during the three-year period
include Kewaunee decommissioning trust fund contributions of approximately
$30.0 million and maturing first-mortgage bonds of $50.0 million.
WPSR expects that internally-generated funds and short-term borrowing will
satisfy substantial portions of its capital requirements. In 1998, WPSR may
enter into financing arrangements involving the issuance, on its behalf, of
trust preferred stock or may issue long-term debt to reduce short-term debt
and to maintain desired capitalization ratios. WPSC may issue debt securities
in 1998. The specific forms of financing, amounts, and timing will depend on
the availability of projects, market conditions, and other factors. WPSR may
expand its leveraged employee stock ownership plan during the three-year
period.
WPSC received approval from the PSCW on March 19, 1998, to recover
approximately $3.8 million of deferred expenses related to the 1997 repairs to
the Kewaunee steam generator tubes. The deferred expenses are being recovered
through a two-month customer surcharge effective in April and May of 1998.
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Cleanup of WPSC's Stevens Point manufactured gas plant site began on
March 27, 1998. The project is expected to be completed by the end of May. A
liability for gas plant cleanup of eight sites has been established and the
costs related to cleanup are being recovered in part through insurance
settlements with the balance recovered through customer rates.
WPSC filed a rate case with the PSCW on April 1, 1998. WPSC is seeking an
8.6% increase in electric revenues in 1999 and an additional 5.0% increase in
2000. WPSC has also requested an increase of 5.7% in gas revenues for 1999
and an additional 0.8% in 2000. A final order is expected from the PSCW in
December 1998 with implementation of new rates on January 1, 1999.
On April 7, 1998, the PSCW approved replacement of the Kewaunee steam
generators at a total cost of approximately $90.7 million. WPSC's share of
the cost is approximately $37.4 million. However, issues related to the
continued operation and future ownership of Kewaunee must be resolved before
the steam generator replacement plan proceeds.
WPSC has reached a tentative contract agreement with the International Union
of Operating Engineers - Local 310. A final vote on the contract is expected
in late April 1998.
The Wisconsin legislature passed an electric reliability bill on
March 26, 1998 which will be effective on September 1, 1998. Among other
provisions, the bill requires utilities to transfer control of the operation
of their transmission systems to an Independent System Operator by
June 30, 2000 and requires eastern Wisconsin utilities to construct a total of
50 megawatts of renewable energy resources by 2000.
WPSR and its subsidiary companies are committed to eliminating or minimizing
adverse effects of the Year 2000 computer compliance issue on their business
operations including the products and services provided to customers and to
maintaining its reputation as an efficient and reliable supplier of energy.
WPSR, however, is unable to guarantee that there will be no adverse affects as
a result of the Year 2000 computer compliance issue because many aspects of
compliance are beyond WPSR's direct control.
WPSR has undertaken a program to assess Year 2000 compliance and to bring
computer systems into compliance by the year 2000. Corrective measures have
been underway since 1996. The major developed systems on the in-house
mainframe are currently being modified to comply with year 2000 standards,
with completion expected in the third quarter of 1998. Energy production and
delivery systems, other embedded systems, and third party systems of suppliers
are being evaluated to identify and resolve potential problems. The most
recent estimated internal labor and third party cost of year 2000 compliance
is approximately $13.4 million.
-19-
<PAGE>
Part II. OTHER INFORMATION
ITEM 5. OTHER INFORMATION
KEWAUNEE NUCLEAR POWER PLANT
On April 7, 1998, the PSCW approved WPSC's application for replacement of the
two steam generators at Kewaunee. The total cost of replacing the steam
generators would be approximately $90.7 million with WPSC's share of the cost
being approximately $37.4 million. The replacement work is tentatively
planned for the spring of 2000 and will take approximately 60 days.
However, issues related to the continued operation and future ownership of
Kewaunee must be resolved before the steam generator replacement plan
proceeds. The owners of Kewaunee have differing views on the desirability of
proceeding with the steam generator replacement project. WPSC favors
replacement at the earliest possible date because of reliability and cost
concerns related to steam generator repairs. The co-owners are continuing to
discuss resolution of the issues.
Kewaunee has been in operation since 1974 and is jointly owned by WPSC,
Wisconsin Power and Light Company, and Madison Gas and Electric Company.
Kewaunee is operated by WPSC.
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, 1997.
ELECTRIC RELIABILITY IN WISCONSIN
The summer of 1997 provided a serious challenge to the reliability of the
electric system in the region. Over 5,000 megawatts of generating capacity
were unavailable for most of the summer as various utility companies
experienced forced outages for a variety of reasons. As a result of these
reliability concerns, the Wisconsin legislature has enacted Assembly Bill 940
with the goal of assuring reliable electric energy for the state. With an
effective date of September 1, 1998, the new law:
1. Replaces the current biannual Advance Plan Process with a
less burdensome biannual Strategic Energy Assessment
Process.
2. Reduces the Certificate of Public Convenience and Necessity
(CPCN) requirements for proposed generation and transmission
construction projects and applies them to fewer facilities.
3. Expedites the approval of construction for those facilities
that are required to be built to address the existing power
shortages.
4. Defines merchant power plants and addresses the process to
be used by the PSCW to approve those facilities.
-20-
<PAGE>
5. Requires the eastern Wisconsin utilities to build
50 megawatts of renewable energy resources by the year 2000.
6. Directs the PSCW to study transmission constraints both in
Wisconsin and adjoining states, and orders the utilities to
build transmission lines to relieve the constraints.
7. Requires transmission owning utilities to transfer control
of the operation of their transmission systems to an
Independent System Operator ("ISO") by June 30, 2000 or
divest those facilities.
8. Establishes the right of an ISO to order construction of
transmission facilities by the states' utilities.
9. Requires the PSCW to establish service standards for
electric generating facilities, transmission facilities, and
distribution facilities.
10. Directs the PSCW to establish rules on out-of-state
electricity sales.
11. Modifies the holding company system nonutility asset cap
which is stated as a percentage of the system's public
utility assets to include the assets of public utilities
organized under the laws of states contiguous to Wisconsin
in the total of the system's public utility assets.
WPSC supported the process used in development of the legislation and views
the legislation as being favorable because it addresses vital reliability and
supply issues and at the same time decreases the regulatory burden. WPSC
participated in a utility report to the state that provided analyses and
recommendations on how to assure the future reliability of the electrical
supply and made recommendations on how to improve the effectiveness of the
state's utility regulatory process. WPSC also worked closely with Governor
Thompson, the PSCW, legislators, and industry participants with the objective
of ensuring that Wisconsin has an adequate supply of reliable power, an
enhanced transmission system, and appropriate regulatory changes.
The law exempts the E. J. Stoneman Power Plant ("Stoneman"), a 53-megawatt
merchant steam plant located in Cassville, Wisconsin, from the PSCW approval
process because of Stoneman's status as a merchant plant prior to enactment of
the law. PDI, a subsidiary of WPSR, owns a two-thirds interest in Stoneman.
CUSTOMER RATE MATTERS
On April 1, 1998, WPSC filed an application with the PSCW to raise its retail
electric and natural gas rates for its Wisconsin customers. For 1999, WPSC
projects revenue requirements to increase over 1997 levels by $36.2 million
for retail electric customers, an increase of 8.6%, and by $11.2 million for
natural gas customers, an increase of 5.7%. In 2000, WPSC projects revenue
requirements to increase over the 1999 levels by $24.3 million for retail
electric customers, an increase of 5%, and by $1.5 million for natural gas
customers, an increase of 0.8%. The requested electric increase is WPSC's
first since 1993 and follows several years of electric rate decreases. If the
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<PAGE>
request is approved, WPSC's 1999 electric rates would still be lower than its
1992 rates and generally lower than those of other large utilities in
Wisconsin and the region. The PSCW is expected to rule on the step rate
change request in December 1998. If approved, the new rates would become
effective on January 1, 1999.
Expenditures to increase electric system reliability as mandated by
Assembly Bill 940, increased costs to fuel power plants, and
higher-than-expected costs to purchase power are major reasons for the
electric rate request. The rate increase for natural gas is needed because of
increased operating expenses and expansion of WPSC's natural gas system.
On March 19, 1998, the PSCW approved a two-month customer surcharge, effective
in April and May, to pay for repairs made in 1997 to the Kewaunee steam
generators. The repairs were necessary to return the plant to service.
Kewaunee had been taken out of service in September of 1996 for refueling,
routine maintenance, and repair of two steam generators, and it was returned
to service on June 12, 1997. WPSC's share of the repair costs amounted to
$3.8 million of the total $9.0 million cost. These repair costs have been
deferred as a regulatory asset.
UNION NEGOTIATIONS
On March 26, 1998, WPSC reached tentative agreement with the International
Union of Operating Engineers - Local 310 ("Union") on a three-year contract.
The previous agreement expired on October 28, 1997. A final vote on the
contract is expected in late April. Approximately, 1,200 of WPSC's 2,400
employees are members of the Union. There has never been a strike against
WPSC by its employees.
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<PAGE>
<PAGE>
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) EXHIBITS
The following documents are filed herewith:
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 was filed by WPS Resources
Corporation on February 25, 1998. The report included under
Item 5 the unaudited pro forma combined balance sheets and
statements of income of WPS Resources Corporation and Upper
Peninsula Energy Corporation for the year ended
December 31, 1997 as filed as an exhibit to Form U-1 dated
February 25, 1998
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<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: April 24, 1998 /s/ Diane Ford
_________________________________
Diane L. Ford
Controller and Chief
Accounting Officer
(Duly Authorized Officer and
Chief Accounting Officer)
-24-
<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: April 24, 1998 /s/ Diane Ford
____________________________________
Diane L. Ford
Controller
(Duly Authorized Officer and
Chief Accounting Officer)
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<PAGE>
WPS RESOURCES CORPORATION AND
WISCONSIN PUBLIC SERVICE CORPORATION
EXHIBIT INDEX TO FORM 10-Q
FOR THE QUARTER ENDED MARCH 31, 1998
Exhibit No. Description
___________ ___________
11 Statement Regarding Computation of Per Share Earnings
WPS Resources Corporation
27 Financial Data Schedule
WPS Resources Corporation
Wisconsin Public Service Corporation
-26-
<PAGE>
<TABLE> <S> <C>
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<NAME> WISCONSIN PUBLIC SERVICE CORPORATION
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<TOTAL-NET-UTILITY-PLANT> 879,585
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0
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<TOTAL-OPERATING-EXPENSES> 155,175
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<EARNINGS-AVAILABLE-FOR-COMM> 17,891
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