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CENTRAL OHIO COAL COMPANY
QUARTERLY REPORT PER REQUIREMENTS
OF HOLDING COMPANY ACT RELEASE NO. 26573
FOR THE QUARTER ENDED MARCH 31, 1997
CONTENTS
Page
Statements of Income and Retained Earnings 1
Balance Sheets 2-3
Information Concerning Mine Operations and
Capital Improvements 4
Calculation of Cost of Capital and
Statement of Cost of Commercial Coal Sold and Shipped 5
Statement of Cost of Operation 6
Analysis of Mining Plant in Service 7
Calculation of Allowed Cost of Capital -
Effective April 1, 1997 8
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CENTRAL OHIO COAL COMPANY
STATEMENT OF INCOME
FOR THE QUARTER ENDED MARCH 31, 1997
(UNAUDITED)
(in thousands)
OPERATING REVENUES $13,446
COST OF OPERATION 13,585
OPERATING LOSS (139)
NONOPERATING INCOME 331
INCOME BEFORE FEDERAL INCOME TAXES 192
FEDERAL INCOME TAXES 192
NET INCOME $ -
STATEMENT OF RETAINED EARNINGS
FOR THE QUARTER ENDED MARCH 31, 1997
(UNAUDITED)
(in thousands)
BALANCE AT BEGINNING OF PERIOD $200
CASH DIVIDENDS DECLARED 200
BALANCE AT END OF PERIOD $ -
The common stock of the Company is wholly owned by Ohio Power Company.
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CENTRAL OHIO COAL COMPANY
BALANCE SHEET
(UNAUDITED)
March 31,
1997
(in thousands)
ASSETS
MINING PLANT:
Mining Plant in Service $70,310
Accumulated Depreciation and Amortization 52,997
NET MINING PLANT 17,313
CURRENT ASSETS:
Cash and Cash Equivalents 7,642
Accounts Receivable:
General 2,105
Affiliated Companies 2,625
Coal 14
Materials and Supplies 8,542
Other 2,336
TOTAL CURRENT ASSETS 23,264
DEFERRED INCOME TAXES 22,381
REGULATORY ASSETS 5,986
DEFERRED CHARGES 55
TOTAL $68,999
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CENTRAL OHIO COAL COMPANY
BALANCE SHEET
(UNAUDITED)
March 31,
1997
(in thousands)
CAPITALIZATION AND LIABILITIES
SHAREHOLDER'S EQUITY:
Common Stock - Par Value $0.10:
Authorized - 100,000 Shares
Outstanding - 69,000 Shares $ 7
Retained Earnings -
TOTAL SHAREHOLDER'S EQUITY 7
LONG-TERM DEBT - Finance Obligations 260
OTHER NONCURRENT LIABILITIES:
Obligations Under Capital Leases 5,949
Operating Reserves 41,108
TOTAL OTHER NONCURRENT LIABILITIES 47,057
CURRENT LIABILITIES:
Long-term Debt Due Within One Year 104
Accounts Payable:
General 1,576
Affiliated Companies 990
Taxes Accrued 2,625
Accrued Reclamation Costs 5,000
Accrued Vacation Pay 902
Workers' Compensation Claims 1,443
Obligations Under Capital Leases 3,353
Other 1,436
TOTAL CURRENT LIABILITIES 17,429
REGULATORY LIABILITIES AND DEFERRED CREDITS 4,246
TOTAL $68,999
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CENTRAL OHIO COAL COMPANY
INFORMATION CONCERNING MINE OPERATIONS AND CAPITAL IMPROVEMENTS
FOR THE QUARTER ENDED MARCH 31, 1997
There were no significant changes with regard to the Company's
operations and mining plant during the quarter.
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CENTRAL OHIO COAL COMPANY
CALCULATION OF COST OF CAPITAL AND STATEMENT OF COST OF COMMERCIAL COAL SOLD AND SHIPPED
FOR THE QUARTER ENDED MARCH 31, 1997
(in thousands, except as noted)
<CAPTION> January through
March
1997
<S> <C>
I. Calculation of Cost-of-Capital Compensation:
A. Equity Investment at Beginning of Period:
Common Stock $ 7
B. Rate of Return Allowable per HCAR No. 22770:
12.81% per annum, 3.2025% per quarter .032025
C. Earnings Allowable: (re investment in item A)
1. Current Quarter $ -
2. Year-to-Date $ -
D. Net Income per Statement of Income $ -
Add: Interest Charges -
Less: Nonoperating Income 331
E. Applied Cost-of-Capital Billing Adder:
1. Current Quarter $ (331)
2. Year-to-Date $ (331)
II. Coal Billing Calculation:
A. Total Operating Expenses (a) $ 13,777
B. Add: Cost-of-Capital Billing Adder as Applied per E. 1. of Section I (331)
C. Cost Applicable to Current Quarter Coal Billings 13,446
Less: Cost Applicable to Coal Sold to Unaffiliated Companies 3,546
Cost Applicable to Current Quarter Coal Billings to Ohio Power $ 9,900
D. Coal Sold and Shipped in Current Quarter to Ohio Power (in tons) 159,086
E. Average Price per Ton to Ohio Power (in dollars) (C/D) $62.23
(a) As represented by "Cost of Operation" plus "Federal Income Taxes" reported in Statements of Income.
/TABLE
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CENTRAL OHIO COAL COMPANY
STATEMENT OF COST OF OPERATION
FOR THE QUARTER ENDED MARCH 31, 1997
(in thousands)
Direct Labor-UMW* $ 361
Indirect Labor-UMW* 1,691
Benefits-UMW* 1,848
Salaries and Benefits-Nonunion 1,403
Operating Supplies 1,958
Repair Parts and Materials 1,180
Electricity and Other Utilities 700
Outside Services-Maintenance, Haulage and Reclamation 494
Taxes Other Than Federal Income Taxes** 502
Rental of Equipment 1,959
Depreciation, Depletion and Amortization 911
Mining Cost Normalization*** (4,735)
Reclamation 3,732
Other Production Costs 1,402
Subtotal 13,406
Transfers of Production Costs (to)/from Coal Inventory 179
Total $13,585
* United Mine Workers of America.
** Excludes FICA, Federal Unemployment and State Unemployment.
These costs are reflected in employee benefits.
*** Represents the deferral/accrual required to establish a selling
price based on forecasted results for the year.
The amount of mining cost normalization is established on an
"overall" company basis(i.e., not itemized) and is eliminated by
year-end.
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CENTRAL OHIO COAL COMPANY
ANALYSIS OF MINING PLANT IN SERVICE
AND RELATED ACCUMULATED PROVISIONS FOR
DEPRECIATION AND AMORTIZATION
March 31, 1997
Net
Gross Accumulated Carrying
Cost Provisions Amount
(in thousands)
Description
Surface Lands $ 324 $ - $ 324
Mining Structures and Equipment 63,036 50,832 12,204
Coal Interests (net of depletion) 4,658 - 4,658
Leasehold Improvements 2,292 2,165 127
Total Mining Plant in Service $70,310 $52,997 $17,313
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OHIO POWER COMPANY'S (OPCo's) ACTIVE COAL MINES
CENTRAL OHIO COAL COMPANY; SOUTHERN OHIO COAL - MEIGS;
AND WINDSOR COAL COMPANY
ALLOWED AFTER-TAX COMPOSITE COST-OF-CAPITAL IS 10.29%
EFFECTIVE 4-1-97
THE 10.29% IS OPCo's WEIGHTED AVERAGE COST-OF-CAPITAL AND WAS
CALCULATED AS FOLLOWS:
CAPITALIZATION AFTER-TAX
@12/31/96 PERCENT EFFECTIVE WEIGHTED
COMPONENT (000) OF TOTAL COST RATE OF RETURN
Long-term Debt $ 957,626(a) 39.14% 7.47%(c) 2.92%
Preferred Stock 148,432 6.07% 5.73%(c) 0.35%
Common Stock 1,340,260(b) 54.79% 12.81%(d) 7.02%
Total $2,446,318 100.00% 10.29%*
Authorization: HCAR 35-26573 dated 9-13-96
(SEC File No. 70-8611).
(a) Includes long-term debt due in one year and is net of
unamortized debt premium and discount, unamortized debt
expense and unamortized loss on reacquired debt.
(b) Common equity includes premium on preferred stock and
excludes undistributed subsidiary earnings.
(c) Embedded cost at 12/31/96.
(d) No more than the rate allowed by the PUCO in a retail rate
proceeding involving OPCo and settled in 1995.
* Rate will be applied for billing purposes to the twelve
months period commencing April 1, 1997.
