|
|
|
|
|
|
|
|
|
|
|
|
|
|
Previous: COMMERCIAL CREDIT CO, 8-K, 1995-02-27 |
Next: PIONEER TAX FREE INCOME FUND INC, NSAR-B, 1995-02-27 |
<PAGE>
HOUSTON INDUSTRIES INCORPORATED
FORM U-3A-2
FOR CALENDAR YEAR 1994
This report consists of 39 consecutively numbered pages.
<PAGE>
File No. 1-7629
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C.
FORM U-3A-2
Statement by Holding Company Claiming
Exemption Under Rule U-3A-2 from the
Provisions of the Public Utility
Holding Company Act of 1935
To be Filed Annually Prior to March 1
Houston Industries Incorporated
-----------------------------------------------------
(Name of Company)
hereby files with the Securities and Exchange Commission, pursuant to Rule 2,
its statement claiming exemption as a holding company from the provisions of the
Public Utility Holding Company Act of 1935, and submits the following
information:
1. NAME, STATE OF ORGANIZATION, LOCATION AND NATURE OF BUSINESS OF CLAIMANT
AND EVERY SUBSIDIARY THEREOF, OTHER THAN ANY EXEMPT WHOLESALE GENERATOR (EWG) OR
FOREIGN UTILITY COMPANY IN WHICH CLAIMANT DIRECTLY OR INDIRECTLY HOLDS AN
INTEREST.
Houston Industries Incorporated. Claimant is Houston Industries
Incorporated, a Texas corporation having its principal place of business at 5
Post Oak Park, 4400 Post Oak Parkway, Houston, Texas 77027. Claimant's business
is the holding of the stocks of its subsidiaries and performance of financial,
administrative and other support services in connection with the operations of
such subsidiaries.
Houston Lighting & Power Company. Claimant has one subsidiary which is a
"public utility company" as defined in Section 2(a)(5) of the Public Utility
Holding Company Act of 1935, namely Houston Lighting & Power Company (HL&P), a
Texas corporation with executive offices located at 611 Walker Avenue, Houston,
Texas 77002. HL&P, which is Claimant's principal operating subsidiary, is
engaged in the generation, transmission, distribution and sale of electric
energy and serves customers in an approximately 5,000 square mile area of the
Texas Gulf Coast, including Houston.
HL&P Receivables, Inc., a Delaware corporation and a wholly-owned
subsidiary of HL&P, holds an
2 of 39
<PAGE>
interest in a trust for railroad settlement payments received by HL&P. HL&P
Receivables, Inc. is located at 611 Walker Avenue, Houston, Texas 77002.
Houston Industries Energy, Inc. Houston Industries Energy, Inc. (HI
Energy), a Delaware corporation located at 611 Walker Avenue, Houston, Texas
77002, participates in domestic and foreign power generation projects and
invests in the privatization of foreign electric utility systems.
Houston Argentina S.A. (Houston Argentina), a wholly-owned subsidiary of
HI Energy, is an Argentine corporation located in Buenos Aires, Argentina,
the principal asset of which is a 32.5% interest in an Argentine holding
company which owns a controlling interest in (a) Empresa Distribuidora de La
Plata S.A. (EDELAP), an Argentine electric utility serving the City of La
Plata and its environs and (b) Central Dique S.A., an Argentine corporation
(Central Dique) formed to own and operate the electrical generating assets of
EDELAP. Houston Argentina provides management and technical services to
EDELAP.
Industrias Electricas de Houston S.A. (Industrias), a wholly-owned
subsidiary of HI Energy, is an Argentine corporation located in Buenos Aires,
Argentina, owning 90% of Empresa Distribuidora de Electricidad de Santiago
del Estero S.A.(EDESE), an Argentine corporation formed in January 1995 which
provides electric utility services to the Province of Santiago del Estero in
northern Argentina.
For additional information regarding the assets of EDELAP, Central Dique
and EDESE, reference is made to Section 4(A)(2) of this Statement. Pursuant
to Section 33(a) of the Public Utility Holding Company Act of 1935, neither
EDELAP, Houston Argentina, Industrias or EDESE is a "public utility holding
company" (as defined under Section 2(a)(5) of such Act).
HIE Ford Heights, Inc. (HIE Ford Heights), a wholly-owned subsidiary of
HI Energy, is a Delaware corporation that owns a 20% interest in CGE Ford
Heights, L.L.C. (CGE Ford Heights), a Delaware limited liability company
formed for the sole purpose of (1) developing, owning, constructing and
operating a waste tire processing facility and a
3 of 39
<PAGE>
tire combustion facility and (2) constructing and operating an adjacent
recycling facility, all located in the Village of Ford Heights, Illinois.
HIE Ford Heights and CGE Ford Heights are located at 611 Walker Avenue,
Houston, Texas 77002.
Houston Industries Energy - Deer Park, Inc. (HIE Deer Park), a wholly-owned
subsidiary of HI Energy, is a Delaware corporation that manages a
cogeneration facility of Shell Oil Company in Deer Park, Texas. HIE Deer
Park is located at 5700 Hwy. 225 Cogen Gate, Deer Park, Texas 77536.
KBLCOM Incorporated. The only subsidiary of Claimant (other than HL&P)
that has significant assets or made a material contribution to Claimant's 1994
consolidated revenues or income is KBLCOM Incorporated (KBLCOM), a Delaware
corporation.
On January 26, 1995, Claimant entered into an Agreement and Plan of Merger
(Merger Agreement) with KBLCOM, Time Warner Inc., a Delaware corporation
(Parent), and TW KBLCOM Acquisition Corp., a Delaware corporation and a newly
formed, wholly-owned subsidiary of Parent ("Sub"). Pursuant to the Merger
Agreement, Sub will merge with and into KBLCOM and KBLCOM will become a wholly-
owned subsidiary of Parent. Parent is not affiliated with Claimant.
KBLCOM operates cable television systems through the following subsidiaries.
Indirect subsidiaries of KBLCOM are indented under the listing of their
respective parent corporations. The principal business address of KBLCOM and
each subsidiary is 2 Allen Center, 1200 Smith, Suite 1800, Houston, Texas 77002.
KBL Cable, Inc. (Delaware)
KBL-TV Incorporated (Delaware)
KBL-TV Incorporated sells advertising time on behalf of cable systems owned
by subsidiaries of KBL Cable, Inc. and other unrelated parties. KBL-TV
Incorporated owns a 60% interest in The Greater Portland Cable Advertising
Interconnect, an Oregon Partnership that provides advertising services to a
group of Portland area cablesystems. That portion of the ownership interest
in such partnership that is not owned by KBL-TV Incorporated is owned by
unaffiliated partners.
KBL Cablesystems of the Southwest, Inc. (Minnesota)
4 of 39
<PAGE>
KBL Cablesystems of the Southwest, Inc. owns (1) cable television systems in
the areas of greater San Antonio, Minneapolis and Laredo, (2) a 99% interest
in Dickinson Pacific Cablesystems, a California general partnership that owns
cable television systems in Orange County, California, and (3) a 98.99598%
interest in KBL-Portland Cablesystems Limited Partnership, an Oregon limited
partnership that owns cable television systems in Portland, Oregon.
KBL Cable TV, Inc. (Delaware)
KBL Cable TV, Inc. owns (1) a 1% interest in Dickinson Pacific
Cablesystems, (2) a 1% interest in KBL-Multnomah Cablesystems Limited
Partnership, an Oregon limited partnership that owns cable television
systems in Multnomah County, Oregon and (3) a 1.2536% interest in KBL
Cablesystems of Minneapolis Limited Partnership, a Minnesota limited
partnership that owns cable television systems in Minneapolis.
TVE Transmission, Inc. (Texas)
TVE Transmission, Inc. provides microwave services to a division of KBL
Cablesystems of the Southwest, Inc. and other unrelated parties.
KBL Cablesystems of Multnomah, Inc. (Oregon)
KBL Cablesystems of Multnomah, Inc. owns (1) a 99% interest in KBL-
Multnomah Cablesystems Limited Partnership and (2) a 1.00402% interest
in KBL-Portland Cablesystems Limited Partnership.
KBL Cablesystems of Minneapolis, Inc. (Minnesota)
KBL Cablesystems of Minneapolis, Inc. owns a 96.11405% interest in KBL
Cablesystems of Minneapolis Limited Partnership. The 2.63235% of the
partnership interest in such partnership that is not owned by KBL
Cablesystems of Minneapolis, Inc. or by KBL Cable TV, Inc. is owned by
unaffiliated limited partners.
KBL Properties, Inc. (Delaware)
5 of 39
<PAGE>
KBL Properties, Inc. owns certain real estate properties and leases the
properties to subsidiaries of KBL Cable, Inc.
KBL Ventures Incorporated (Delaware)
KBL Ventures Incorporated owns (1) a 10% interest in Cable Advertising Partners,
a California partnership that provides advertising services to a group of Los
Angeles area cable systems, (2) a 34.3% interest in Upper Midwest Cable
Partners, a Minnesota partnership that provides sports programming to a group of
Minneapolis area cable systems, (3) a 25% interest in Interconnect of the Twin
Cities, a Minnesota partnership that provides advertising services to a group of
Minneapolis area cable systems, (4) a 3% common stock investment in
International Cablecasting Technologies, Inc., a Delaware corporation and (5) a
4.2% common stock investment in Starsight Telecast, Inc., a California
corporation. That portion of the ownership interests in such partnerships that
is not owned by KBL Ventures Incorporated is owned by unaffiliated partners.
KBL Communications, Inc. (Delaware)
KBL Communications, Inc. owns (1) a 50% interest in Paragon Communications, a
Colorado partnership that owns cable television systems, (2) a 16.67% interest
in CAT Partnership, a California partnership that owns certain cable television
assets or systems (or proceeds from the disposition thereof) and (3) a 14.6175%
interest in ARP Partnership, a Delaware partnership that owns certain cable
television assets.
FIBRCOM Incorporated (Delaware)
FIBRCOM Incorporated owns a 42.84% interest in Linkatel Pacific, Limited
Partnership, a California limited partnership that was formed to develop an
alternate access business in the Los Angeles area. That portion of the
ownership interest in such partnership not owned by FIBRCOM Incorporated is
owned by unaffiliated partners.
KBL Integrated Services, Inc. (Delaware)
KBL Integrated Services, Inc. operates private telephone systems in the San
Antonio area.
Minnesota Cable Properties, Inc. (Minnesota)
Minnesota Cable Properties, Inc. provides cable television service to the
communities in the greater
6 of 39
<PAGE>
Minneapolis, Minnesota area.
Amzak Cable, Midwest, Inc. (Texas)
Amzak Cable, Midwest, Inc. provides cable television service to the communities
in the greater Minneapolis, Minnesota area.
Nortel Cable Corporation (Minnesota)
Nortel Cable Corporation owns a 82.9% interest in Nortel Cable Associates, a
Delaware limited partnership that provides cable television service to the
communities in the greater Minneapolis, Minnesota area.
Countryside Investments, Inc. (Delaware)
Countryside Investments, Inc. owns a 17.1% interest in Nortel Cable Associates,
a Delaware limited partnership that provides cable television service to the
communities in the greater Minneapolis, Minnesota area.
_________________________________
Claimant has six additional subsidiaries, none of which is material and all
of which (except as otherwise noted) are located at 5 Post Oak Park, 4400 Post
Oak Parkway, Houston, Texas 77027, as follows:
Development Ventures, Inc., a Delaware corporation that has principally
provided financing to small, emerging businesses located in or near HL&P's
service area.
Primary Fuels, Inc., a Texas corporation that was engaged in oil and gas
exploration, development and production activities until 1989 when all of its
oil and gas assets were sold.
Houston Industries Products, Inc., a Delaware corporation organized to
develop and market inventions, technology and other intellectual property owned
by Claimant and Claimant's other subsidiaries.
Houston Industries (Delaware) Incorporated, a Delaware corporation located at
200 West Ninth Street, Wilmington, Delaware 19801, the only assets of which are
shares of non-voting class B common stock of HL&P.
Houston Industries Building, Inc., a Delaware corporation, owns an office
building in downtown Houston, Texas which is being renovated to become the
corporate headquarters for Claimant and its subsidiaries.
7 of 39
<PAGE>
Utility Rail Services, Inc., a Delaware corporation that owns 100% of UFI
Services, Inc., a Delaware subsidiary which owns a 50% interest in a Nebraska-
based joint venture that constructs, repairs, stores and maintains rail cars.
2. A BRIEF DESCRIPTION OF THE PROPERTIES OF CLAIMANT AND EACH OF ITS
SUBSIDIARY PUBLIC UTILITY COMPANIES USED FOR THE GENERATION, TRANSMISSION, AND
DISTRIBUTION OF ELECTRIC ENERGY FOR SALE, OR FOR THE PRODUCTION, TRANSMISSION,
AND DISTRIBUTION OF NATURAL OR MANUFACTURED GAS, INDICATING THE LOCATION OF
PRINCIPAL GENERATING PLANTS, TRANSMISSION LINES, PRODUCING FIELDS, GAS
MANUFACTURING PLANTS, AND ELECTRIC AND GAS DISTRIBUTION FACILITIES, INCLUDING
ALL SUCH PROPERTIES WHICH ARE OUTSIDE THE STATE IN WHICH CLAIMANT AND ITS
SUBSIDIARIES ARE ORGANIZED AND ALL TRANSMISSION OR PIPELINES WHICH DELIVER OR
RECEIVE ELECTRIC ENERGY OR GAS AT THE BORDERS OF SUCH STATE.
The only properties to which this item is applicable are the electric utility
properties of HL&P. Such properties are located in the Counties of Anderson,
Austin, Brazoria, Chambers, Colorado, Fort Bend, Freestone, Galveston, Grimes,
Harris, Henderson, Leon, Liberty, Limestone, Madison, Matagorda, Montgomery,
Robertson, Waller and Wharton in the State of Texas. As of December 31, 1994,
HL&P owned and operated 60 generating units located at 11 generating stations in
the Counties of Chambers, Fort Bend, Galveston, Harris, Limestone and Matagorda
having an aggregate turbine nameplate rating of 13,411,368 kilowatts.
Approximately 34% of HL&P's energy requirements during 1994 was met with
natural gas, 43% with coal and lignite, and 7% with nuclear. The remaining 16%
was met principally with purchased power.
HL&P operates 23,947 pole miles of overhead distribution lines and 3,626
circuit miles of overhead transmission lines including 578 circuit miles
operated at 69,000 volts, 2,011 circuit miles operated at 138,000 volts and
1,037 circuit miles operated at 345,000 volts. HL&P operates 8,833 circuit
miles of underground distribution lines and 12.6 circuit miles of underground
transmission lines, including 8.1 circuit miles operated at 138,000 volts and
4.5 circuit miles operated at 69,000 volts. These lines have been constructed
in, or adjoin, the communities and municipalities served by HL&P. In addition,
HL&P owns and operates switching and transformer stations at its generating
plants and at various points on its system. All such facilities are located
within the State of Texas.
HL&P has no properties and furnishes no service
8 of 39
<PAGE>
outside of, or at the state line of, the State of Texas.
3. THE FOLLOWING INFORMATION FOR THE LAST CALENDAR YEAR WITH RESPECT TO
CLAIMANT AND EACH OF ITS SUBSIDIARY PUBLIC UTILITY COMPANIES:
(A) NUMBER OF KWH. OF ELECTRIC ENERGY SOLD (AT RETAIL OR WHOLESALE), AND MCF.
OF NATURAL OR MANUFACTURED GAS DISTRIBUTED AT RETAIL.
During calendar year 1994, HL&P sold 61,322,796,078 kwh. of electric energy
as follows:
<TABLE>
<CAPTION>
Energy Sales
kwh.
--------------
<S> <C>
Residential 17,194,724,397
Commercial 13,631,381,064
Industrial 29,506,233,080
Other Utilities 873,815,267
Public Authorities 116,642,270
</TABLE>
HL&P distributed no natural or manufactured gas during 1994.
(B) NUMBER OF KWH. OF ELECTRIC ENERGY AND MCF. OF NATURAL OR MANUFACTURED GAS
DISTRIBUTED AT RETAIL OUTSIDE THE STATE IN WHICH EACH SUCH COMPANY IS ORGANIZED.
None
(C) NUMBER OF KWH. OF ELECTRIC ENERGY AND MCF. OF NATURAL OR MANUFACTURED GAS
SOLD AT WHOLESALE OUTSIDE THE STATE IN WHICH EACH SUCH COMPANY IS ORGANIZED OR
AT THE STATE LINE.
None
(D) NUMBER OF KWH. OF ELECTRIC ENERGY AND MCF. OF NATURAL OR MANUFACTURED GAS
PURCHASED OUTSIDE THE STATE IN WHICH EACH SUCH COMPANY IS ORGANIZED OR AT THE
STATE LINE.
None
4. THE FOLLOWING INFORMATION FOR THE REPORTING PERIOD WITH RESPECT TO
CLAIMANT AND EACH INTEREST IT HOLDS DIRECTLY OR INDIRECTLY IN AN EWG OR A
FOREIGN UTILITY COMPANY, STATING MONETARY AMOUNTS IN UNITED STATES DOLLARS:
(A) NAME, LOCATION, BUSINESS ADDRESS AND
9 of 39
<PAGE>
DESCRIPTION OF THE FACILITIES USED BY THE EWG OR FOREIGN UTILITY COMPANY FOR THE
GENERATION, TRANSMISSION AND DISTRIBUTION OF ELECTRIC ENERGY FOR SALE OR FOR THE
DISTRIBUTION AT RETAIL OF NATURAL OR MANUFACTURED GAS.
1. EWGs. The Claimant does not directly or indirectly own any interest in
an EWG.
2. Foreign Utility Companies.
(a) EDELAP. The Claimant has an indirect interest in EDELAP, a foreign
utility company located in the city of La Plata, the province of Buenos Aires,
Argentina. The business address of EDELAP is Calle 50, No. 543, (1900), La
Plata, Argentina.
EDELAP distributes electricity to approximately 250,000 customers in La
Plata, Argentina and its environs. Maximum demand on its system is
approximately 250 megawatts. EDELAP has one substation and 1,499 kilometers of
distribution lines operated at 13,200 volts. Substantially all of the power
sold by EDELAP is provided through the Argentine national grid.
(b) Central Dique. The Claimant has an indirect interest in Central Dique,
a foreign utility company located in the city of La Plata, the province of
Buenos Aires, Argentina. The business address of Central Dique is Calle 50, No.
543, (1900), La Plata, Argentina.
Central Dique owns the Dique Power Plant, which has seven gas turbines with a
combined capacity of 120 megawatts. Electric power generated by Central Dique
is sold through the Argentine national grid.
(c) EDESE. The Claimant has an indirect interest in EDESE, an Argentine
foreign utility company located in the City of Santiago del Estero, the province
of Santiago del Estero, Argentina. The business address of EDESE is Avenida
Roca (S) 214, Santiago del Estero 4200, Santiago del Estero, Argentina.
EDESE distributes electricity to approximately 100,000 customers in the
province of Santiago del Estero. Maximum demand on its system is approximately
65 megawatts. EDESE has 2,260 circuit kilometers of primary distribution
voltage circuitry and 3,450 circuit-kilometers of secondary distribution voltage
circuitry operated at 13,200 volts. Substantially all of the power sold by
EDESE is provided through the Argentine national grid.
10 of 39
<PAGE>
(B) NAME OF EACH SYSTEM COMPANY THAT HOLDS AN INTEREST IN SUCH EWG OR FOREIGN
UTILITY COMPANY; AND DESCRIPTION OF THE INTEREST HELD.
1. EWGs. No system company (as defined to refer to each subsidiary of the
Claimant, a "System Company") holds an interest in any EWG.
2. Foreign Utility Companies.
(a) Houston Argentina. Houston Argentina owns 32.5% of the voting stock of
Compania de Inversiones en Electricidad S.A., a special purpose Argentine
holding company (COINELEC). COINELEC owns all the issued and outstanding shares
of Class A stock of each of EDELAP and Central Dique. The Class A shares held
by COINELEC represent 51% of the capital stock of each of EDELAP and Central
Dique.
(b) Industrias. Industrias owns 90% of the voting stock of EDESE.
(C) TYPE AND AMOUNT OF CAPITAL INVESTED, DIRECTLY OR INDIRECTLY, BY THE
HOLDING COMPANY CLAIMING EXEMPTION; ANY DIRECT OR INDIRECT GUARANTEE OF THE
SECURITY OF THE EWG OR FOREIGN UTILITY COMPANY BY THE HOLDING COMPANY CLAIMING
EXEMPTION; AND ANY DEBT OR OTHER FINANCIAL OBLIGATION FOR WHICH THERE IS
RECOURSE, DIRECTLY OR INDIRECTLY, TO THE HOLDING COMPANY CLAIMING EXEMPTION OR
ANOTHER SYSTEM COMPANY, OTHER THAN THE EWG OR THE FOREIGN UTILITY COMPANY.
1. In 1992, the Claimant invested $37.4 million (U.S. dollars) in the
acquisition by COINELEC of the Class A shares of ELEDAP and Central Dique. Such
investment was in the form of (a) a direct cash contribution of $1.6 million to
COINELEC, (b) the contribution of $26.0 million aggregate principal amount of
foreign debt securities issued by the Argentine government and (c) a loan to
COINELEC in the aggregate principal amount of $9.8 million. In January 1995,
the Claimant invested $15.6 million (U.S. dollars) in order to acquire the Class
A and Class B shares of EDESE.
2. There are no direct or indirect guarantees by the Claimant of any
security of COINELEC, EDELAP, Central Dique or EDESE.
3. There are no financial obligations of COINELEC, EDELAP, Central Dique or
EDESE for which there is recourse, directly or indirectly, to the Claimant or
any other subsidiary of the Claimant.
11 of 39
<PAGE>
(D) CAPITALIZATION AND EARNINGS OF THE EWG OR FOREIGN UTILITY COMPANY DURING
THE REPORTING PERIOD.
1. EDELAP and Central Dique. At December 31, 1994, the combined
capitalization of EDELAP and Central Dique was approximately $53 million
(calculated on the basis of an exchange ratio of one Argentine peso to one U.S.
dollar) based on the combined book value of their assets at the time of purchase
of control by COINELEC. A proposal to step up such book value is pending before
the Argentine government.
During the twelve-month period ended December 31, 1994, EDELAP and Central
Dique had combined earnings of approximately $7 million (calculated on the basis
of an exchange ratio of one Argentine peso to one U.S. dollar).
2. EDESE. EDESE was acquired on January 4, 1995. EDESE is a newly formed
corporation that assumed the assets of the state-owned electric utility formerly
serving the province of Santiago del Estero. Accordingly, 12-month financial
data for EDESE is unavailable.
(E) IDENTIFY ANY SERVICE, SALES OR CONSTRUCTION CONTRACTS(S) BETWEEN THE EWG
OR FOREIGN UTILITY COMPANY AND A SYSTEM COMPANY, AND DESCRIBE THE SERVICES TO BE
RENDERED OR GOODS SOLD AND FEES OR REVENUES UNDER SUCH AGREEMENT(S).
1. There are no "sales contracts" or "construction contract(s)" (as such
terms are defined in Section 2(a) of the Public Utility Holding Company Act),
between any EWG or Foreign Utility Company and the Claimant or any System
Company.
2. Houston Argentina is a party to a management assistance agreement (the
"Management Services Agreement") with EDELAP and Central Dique. Under the
Management Assistance Agreement, Houston Argentina provides certain technical
and managerial assistance services to EDELAP and Central Dique, including
advising and assisting in the management of the facilities and the training of
technicians and operating and managing personnel. The Management Assistance
Agreement expires in December 2002.
The fee under the Management Services Agreement, which is shared by Houston
Argentina with other shareholders of COINELEC, is 2.7% of the gross receipts of
EDELAP and Central Dique (net of taxes) plus (a) an additional $1 million during
1993 and 1994 and (b) an
12 of 39
<PAGE>
additional $500,000 for each year thereafter until the termination of the
agreement. The management fee is payable quarterly in U.S. dollars. The
Management Assistance Agreement also provides that EDELAP and Central Dique will
reimburse Houston Argentina for certain costs associated with the temporary
assignment of persons employed by the Claimant or by subsidiaries of the
Claimant to perform services on behalf of EDELAP and Central Dique.
13 of 39
<PAGE>
EXHIBIT A
---------
A CONSOLIDATING STATEMENT OF INCOME AND SURPLUS OF THE CLAIMANT AND ITS
SUBSIDIARY COMPANIES FOR THE LAST CALENDAR YEAR, TOGETHER WITH A CONSOLIDATING
BALANCE SHEET OF CLAIMANT AND ITS SUBSIDIARY COMPANIES AS OF THE CLOSE OF SUCH
CALENDAR YEAR.
See Exhibits A-1 and A-2, respectively.
The above-named Claimant has caused this statement to be duly executed on its
behalf by its authorized officer on this 24th day of February, 1995.
HOUSTON INDUSTRIES INCORPORATED
By: /s/ Mary P. Ricciardello
-------------------------
Mary P. Ricciardello
Comptroller
CORPORATE SEAL
ATTEST:
/s/ R. E. Smith
- -----------------------------
Assistant Corporate Secretary
NAME, TITLE AND ADDRESS OF OFFICER TO WHOM NOTICES AND CORRESPONDENCE
CONCERNING THIS STATEMENT SHOULD BE ADDRESSED:
William A. Cropper
Vice President and Treasurer
Houston Industries Incorporated
5 Post Oak Park, 28th Floor
4400 Post Oak Parkway
Houston, Texas 77027
EXHIBIT B
---------
FINANCIAL DATA SCHEDULE OF CLAIMANT.
EXHIBIT C
---------
AN ORGANIZATIONAL CHART SHOWING THE RELATIONSHIP OF EACH EWG OR FOREIGN
UTILITY COMPANY TO ASSOCIATE COMPANIES IN THE HOLDING-COMPANY SYSTEM.
14 of 39
<PAGE>
<TABLE>
<CAPTION>
HOUSTON INDUSTRIES INCORPORATED & SUBSIDIARIES EXHIBIT A-1
CONSOLIDATING STATEMENT OF INCOME AND RETAINED EARNINGS
TWELVE MONTHS ENDED DECEMBER 31, 1994
(THOUSANDS OF DOLLARS)
HII HL&P KBLCOM DVI HIEI HIBI
---------- ---------- --------- -------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
OPERATING REVENUES $3,746,085 $255,772
---------- ---------- --------- -------- ------- -------
OPERATING EXPENSES:
ELECTRIC:
FUEL 860,936
PURCHASED POWER 408,963
OPERATION AND MAINTENANCE 828,748
TAXES OTHER THAN INCOME TAXES 251,421
CABLE TELEVISION OPERATING EXPENSES 156,084
DEPRECIATION & AMORTIZATION $721 398,142 84,681 $121
---------- ---------- --------- -------- ------- -------
TOTAL 721 2,748,210 240,765 0 121 0
---------- ---------- --------- -------- ------- -------
OPERATING INCOME (LOSS) (721) 997,875 15,007 0 (121) 0
---------- ---------- --------- -------- ------- -------
OTHER INCOME (EXPENSE):
ALLOWANCE FOR OTHER FUNDS USED DURING
CONSTRUCTION 4,115
DIVIDEND INCOME
INTEREST INCOME 224 10,000 2,415
EQUITY IN INCOME OF CABLE TELEVISION
PARTNERSHIPS 33,313
OTHER-NET (15,081) (13,397) (1,293) $12 (8,592) ($1,866)
GAIN ON SALE OF RAIL FLEET
INTEREST INCOME FROM SUBSIDIARIES 85,841
---------- ---------- --------- -------- ------- -------
TOTAL OTHER INCOME (EXPENSE) 70,984 718 34,435 12 (8,592) (1,866)
---------- ---------- --------- -------- ------- -------
INTEREST AND OTHER CHARGES:
INTEREST ON LONG-TERM DEBT 17,257 246,533 42,279
OTHER INTEREST 127,940 8,493 9,897 72 1,300
ALLOWANCE FOR BORROWED FUNDS USED DURING
CONSTRUCTION (CREDIT) (5,554)
PREFERRED DIVIDENDS OF SUBSIDIARY
---------- ---------- --------- -------- ------- -------
TOTAL INTEREST AND OTHER CHARGES 145,197 249,472 52,176 0 72 1,300
---------- ---------- --------- -------- ------- -------
INCOME (LOSS) BEFORE INCOME TAXES AND
CUMULATIVE EFFECT (74,934) 749,121 (2,734) 12 (8,785) (3,166)
INCOME TAXES (30,041) 254,157 (2,851) (56) (2,638) (1,108)
CUMULATIVE EFFECT OF CHANGE IN ACCOUNTING FOR
POSTEMPLOYMENT BENEFITS (NET OF INCOME TAXES
OF $4,415) (8,200)
---------- ---------- --------- -------- ------- -------
NET INCOME (LOSS) (44,893) 486,764 117 68 (6,147) (2,058)
DIVIDENDS ON PREFERRED STOCK 33,583
---------- ---------- --------- -------- ------- -------
NET INCOME (LOSS) FOR COMMON STOCK (44,893) 453,181 117 68 (6,147) (2,058)
EQUITY IN EARNINGS OF SUBSIDIARIES 397,966
INTEREST ON NOTE HELD BY PARENT (NET OF TAX
BENEFIT OF $24,963) 46,169 (46,169)
CASH DIVIDENDS ON COMMON STOCK 369,270 328,996
---------- ---------- --------- -------- ------- -------
NET INCREASE (DECREASE) IN RETAINED EARNINGS 29,972 124,185 (46,052) 68 (6,147) (2,058)
RETAINED EARNINGS (DEFICIT) AT BEGINNING OF
PERIOD 1,191,327 2,028,924 (944,630) (10,638) (1,660) (1)
ADJUSTMENT TO ADDITIONAL PAID-IN CAPITAL
---------- ---------- --------- -------- ------- -------
RETAINED EARNINGS (DEFICIT) AT END OF PERIOD $1,221,299 $2,153,109 ($990,682) ($10,570) ($7,807) ($2,059)
========== ========== ========= ======== ======= =======
EARNINGS (LOSS) PER COMMON SHARE (1) ($0.36) $3.69 $0.00 ($0.00) ($0.05) ($0.02)
========== ========== ========= ======== ======= =======
(1) BASED ON WEIGHTED AVERAGE COMMON
SHARES OUTSTANDING OF HOUSTON
INDUSTRIES INCORPORATED (000) - 122,853
LEGEND OF SUBSIDIARY NAMES:
---------------------------------------------
HII - HOUSTON INDUSTRIES INCORPORATED
HL&P - HOUSTON LIGHTING & POWER COMPANY
KBLCOM - KBLCOM INCORPORATED AND SUBSIDIARIES
DVI - DEVELOPMENT VENTURES, INC.
HIEI - HOUSTON INDUSTRIES ENERGY, INC.
HIBI - HOUSTON INDUSTRIES BUILDING, INC.
</TABLE>
15 of 39
<PAGE>
<TABLE>
<CAPTION>
HOUSTON INDUSTRIES INCORPORATED & SUBSIDIARIES EXHIBIT A-1
CONSOLIDATING STATEMENT OF INCOME AND RETAINED EARNINGS
TWELVE MONTHS ENDED DECEMBER 31, 1994
(THOUSANDS OF DOLLARS)
ELIMINATIONS/
HIDI HIPI URS PFI RECLASSIFICATION CONSOLIDATED
------- ----- ------- ------- ---------------- ------------
<S> <C> <C> <C> <C> <C> <C>
OPERATING REVENUES $4,001,857
------- ----- ------- ------- ----------- ----------
OPERATING EXPENSES:
ELECTRIC:
FUEL 860,936
PURCHASED POWER 408,963
OPERATION AND MAINTENANCE 828,748
TAXES OTHER THAN INCOME TAXES 251,421
CABLE TELEVISION OPERATING EXPENSES 156,084
DEPRECIATION & AMORTIZATION $19 $195 $1 483,880
------- ----- ------- ------- ----------- ----------
TOTAL 0 19 195 0 1 2,990,032
------- ----- ------- ------- ----------- ----------
OPERATING INCOME (LOSS) 0 (19) (195) 0 (1) 1,011,825
------- ----- ------- ------- ----------- ----------
OTHER INCOME (EXPENSE):
ALLOWANCE FOR OTHER FUNDS USED DURING
CONSTRUCTION 4,115
DIVIDEND INCOME $328,996 (328,996)
INTEREST INCOME 42 (7,025) 5,656
EQUITY IN INCOME OF CABLE TELEVISION
PARTNERSHIPS 33,313
OTHER-NET (40) (279) 861 ($2) 7,791 (31,886)
GAIN ON SALE OF RAIL FLEET 616 (616)
INTEREST INCOME FROM SUBSIDIARIES (85,841)
------- ----- ------- ------- ----------- ----------
TOTAL OTHER INCOME (EXPENSE) 328,956 (279) 1,519 (2) (414,687) 11,198
------- ----- ------- ------- ----------- ----------
INTEREST AND OTHER CHARGES:
INTEREST ON LONG-TERM DEBT 8,485 314,554
OTHER INTEREST 861 (94,197) 54,366
ALLOWANCE FOR BORROWED FUNDS USED DURING
CONSTRUCTION (CREDIT) (5,554)
PREFERRED DIVIDENDS OF SUBSIDIARY 33,583 33,583
------- ----- ------- ------- ----------- ----------
TOTAL INTEREST AND OTHER CHARGES 0 0 861 0 (52,129) 396,949
------- ----- ------- ------- ----------- ----------
INCOME (LOSS) BEFORE INCOME TAXES AND
CUMULATIVE EFFECT 328,956 (298) 463 (2) (362,559) 626,074
INCOME TAXES (14) (104) 1,299 (31) 218,613
CUMULATIVE EFFECT OF CHANGE IN ACCOUNTING FOR
POSTEMPLOYMENT BENEFITS (NET OF INCOME TAXES
OF $4,415) (8,200)
------- ----- ------- ------- ----------- ----------
NET INCOME (LOSS) 328,970 (194) (836) 29 (362,559) 399,261
DIVIDENDS ON PREFERRED STOCK (33,583)
------- ----- ------- ------- ----------- ----------
NET INCOME (LOSS) FOR COMMON STOCK 328,970 (194) (836) 29 (328,976) 399,261
EQUITY IN EARNINGS OF SUBSIDIARIES (397,966)
INTEREST ON NOTE HELD BY PARENT (NET OF TAX
BENEFIT OF $24,963)
CASH DIVIDENDS ON COMMON STOCK 328,946 (657,942) 369,270
------- ----- ------- ------- ----------- ----------
NET INCREASE (DECREASE) IN RETAINED EARNINGS 24 (194) (836) 29 (69,000) 29,991
RETAINED EARNINGS (DEFICIT) AT BEGINNING OF
PERIOD 16 (174) (2,477) (4,233) (1,065,224) 1,191,230
ADJUSTMENT TO ADDITIONAL PAID-IN CAPITAL (140) 140
------- ----- ------- ------- ----------- ----------
RETAINED EARNINGS (DEFICIT) AT END OF PERIOD $40 ($368) ($3,313) ($4,344) ($1,134,084) $1,221,221
======= ===== ======= ======= =========== ==========
EARNINGS (LOSS) PER COMMON SHARE (1) $0.00 $0.00 ($0.01) ($0.00) $3.25
======= ===== ======= ======= =========== ==========
(1) BASED ON WEIGHTED AVERAGE COMMON
SHARES OUTSTANDING OF HOUSTON
INDUSTRIES INCORPORATED (000) - 122,853
LEGEND OF SUBSIDIARY NAMES:
- ---------------------------------------------------
HIDI - HOUSTON INDUSTRIES (DELAWARE) INCORPORATED
HIPI - HOUSTON INDUSTRIES PRODUCTS, INC.
URS - UTILITY RAIL SERVICES, INC.
PFI - PRIMARY FUELS, INC.
</TABLE>
16 of 39
<PAGE>
<TABLE>
<CAPTION>
HOUSTON INDUSTRIES INCORPORATED & SUBSIDIARIES EXHIBIT A-2
CONSOLIDATING BALANCE SHEET--ASSETS
DECEMBER 31, 1994
(THOUSANDS OF DOLLARS)
HII HL&P (1) KBLCOM DVI HIEI HIBI
---------- ----------- ---------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
ASSETS:
PROPERTY, PLANT, AND EQUIPMENT, AT COST:
ELECTRIC PLANT $12,277,991
ELECTRIC PLANT AQUISITION ADJUSTMENTS 3,166
NUCLEAR FUEL 212,795
CABLE TELEVISION PROPERTY $438,026
OTHER PROPERTY $12,801 $289 $72,863
---------- ----------- ---------- ------- ------- -------
TOTAL PROPERTY, PLANT AND EQUIPMENT 12,801 12,493,952 438,026 0 289 72,863
LESS: ACCUMULATED DEPRECIATION
AND AMORTIZATION 9,524 3,517,923 161,402 58 142
---------- ----------- ---------- ------- ------- -------
PROPERTY, PLANT AND EQUIPMENT- NET 3,277 8,976,029 276,624 0 231 72,721
---------- ----------- ---------- ------- ------- -------
INVESTMENT IN ASSOCIATED COMPANIES 3,623,780
---------- ----------- ---------- ------- ------- -------
CURRENT ASSETS:
CASH AND CASH EQUIVALENTS 138 235,867 $126 1,088 685
SPECIAL DEPOSITS 10
ACCOUNTS RECEIVABLE - CUSTOMERS 6,873
ACCOUNTS RECEIVABLE - OTHER 487 8,896 7,369 337 11,712 674
ACCRUED UNBILLED REVENUES 38,372
ACCOUNTS RECEIVABLE FROM ASSOCIATED
COMPANIES 108,438 4,213 402 216
NOTES RECEIVABLE FROM ASSOCIATED
COMPANIES 941,503
FUEL STOCK, AT LIFO COST 56,711
MATERIALS & SUPPLIES, AT AVERAGE COST 147,922 9,952
OTHER 4,591 9,665 3,466 110
---------- ----------- ---------- ------- ------- -------
TOTAL CURRENT ASSETS 1,055,157 501,656 27,660 865 13,126 1,359
---------- ----------- ---------- ------- ------- -------
OTHER ASSETS:
CABLE TELEVISION FRANCHISES AND
INTANGIBLE ASSETS 1,029,440
DEFERRED PLANT COSTS 638,917
DEFERRED DEBITS 34,940 241,611 60,718 11,377 2,374 55
UNAMORTIZED DEBT EXPENSE AND PREMIUM
ON REACQUIRED DEBT 2,028 158,351
EQUITY INVESTMENT IN CABLE TELEVISION
PARTNERSHIPS 160,363
EQUITY INVESTMENT IN FOREIGN ELECTRIC
UTILITY 35,449
REGULATORY ASSET - NET 235,463
RECOVERABLE PROJECT COSTS 98,954
---------- ----------- ---------- ------- ------- -------
TOTAL OTHER ASSETS 36,968 1,373,296 1,250,521 11,377 37,823 55
---------- ----------- ---------- ------- ------- -------
TOTAL $4,719,182 $10,850,981 $1,554,805 $12,242 $51,180 $74,135
========== =========== ========== ======= ======= =======
(1) INCLUDES THE CONSOLIDATION OF HL&P RECEIVABLES, INC. THE ONLY
ACTIVITY WAS A $1,000 EQUITY CONTRIBUTION BY HL&P.
</TABLE>
17 of 39
<PAGE>
<TABLE>
<CAPTION>
HOUSTON INDUSTRIES INCORPORATED & SUBSIDIARIES EXHIBIT A-2
CONSOLIDATING BALANCE SHEET--ASSETS
DECEMBER 31, 1994
(THOUSANDS OF DOLLARS)
ELIMINATIONS/
HIDI HIPI URS PFI RECLASSIFICATION CONSOLIDATED
-------- ---- ------ --- ---------------- ------------
<S> <C> <C> <C> <C> <C> <C>
ASSETS:
PROPERTY, PLANT, AND EQUIPMENT, AT COST:
ELECTRIC PLANT $12,277,991
ELECTRIC PLANT AQUISITION ADJUSTMENTS 3,166
NUCLEAR FUEL 212,795
CABLE TELEVISION PROPERTY 438,026
OTHER PROPERTY $1 ($425) 85,529
-------- ---- ------ --- ----------- -----------
TOTAL PROPERTY, PLANT AND EQUIPMENT 0 1 0 0 (425) 13,017,507
LESS: ACCUMULATED DEPRECIATION
AND AMORTIZATION 35 (84) 3,689,000
-------- ---- ------ --- ----------- -----------
PROPERTY, PLANT AND EQUIPMENT- NET 0 (34) 0 0 (341) 9,328,507
-------- ---- ------ --- ----------- -----------
INVESTMENT IN ASSOCIATED COMPANIES $150,978 (3,774,758) 0
-------- ---- ------ --- ----------- -----------
CURRENT ASSETS:
CASH AND CASH EQUIVALENTS 52 33 $52 (227,598) 10,443
SPECIAL DEPOSITS 10
ACCOUNTS RECEIVABLE - CUSTOMERS 30 6,903
ACCOUNTS RECEIVABLE - OTHER 13 29,488
ACCRUED UNBILLED REVENUES 38,372
ACCOUNTS RECEIVABLE FROM ASSOCIATED
COMPANIES 3 30 (113,302)
NOTES RECEIVABLE FROM ASSOCIATED
COMPANIES (941,503)
FUEL STOCK, AT LIFO COST 56,711
MATERIALS & SUPPLIES, AT AVERAGE COST 85 157,959
OTHER 31 1 17,864
-------- ---- ------ --- ----------- -----------
TOTAL CURRENT ASSETS 55 179 95 0 (1,282,402) 317,750
-------- ---- ------ --- ----------- -----------
OTHER ASSETS:
CABLE TELEVISION FRANCHISES AND
INTANGIBLE ASSETS 1,029,440
DEFERRED PLANT COSTS 638,917
DEFERRED DEBITS 338 5,573 (69,567) 287,419
UNAMORTIZED DEBT EXPENSE AND PREMIUM
ON REACQUIRED DEBT 1,506 161,885
EQUITY INVESTMENT IN CABLE TELEVISION
PARTNERSHIPS 160,363
EQUITY INVESTMENT IN FOREIGN ELECTRIC
UTILITY 35,449
REGULATORY ASSET - NET 235,463
RECOVERABLE PROJECT COSTS 98,954
-------- ---- ------ --- ----------- -----------
TOTAL OTHER ASSETS 0 338 5,573 0 (68,061) 2,647,890
-------- ---- ------ --- ----------- -----------
TOTAL $151,033 $483 $5,668 $0 ($5,125,562) $12,294,147
======== ==== ====== === =========== ===========
</TABLE>
18 of 39
<PAGE>
<TABLE>
<CAPTION>
HOUSTON INDUSTRIES INCORPORATED & SUBSIDIARIES EXHIBIT A-2
CONSOLIDATING BALANCE SHEET--LIABILITIES
DECEMBER 31, 1994
(THOUSANDS OF DOLLARS)
HII HL&P KBLCOM DVI HIEI HIBI
---------- ----------- ---------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
LIABILITIES AND STOCKHOLDERS' EQUITY:
SHAREHOLDERS' EQUITY:
COMMON STOCK $2,437,638 $1,675,927 $738,132 $23,867 $45,306 $1
UNEARNED ESOP SHARES (289,611)
RETAINED EARNINGS 1,221,299 2,153,109 (990,682) (10,570) (7,807) (2,059)
PREFERRED STOCK 473,255
---------- ----------- ---------- ------- ------- -------
TOTAL SHAREHOLDERS' EQUITY 3,369,326 4,302,291 (252,550) 13,297 37,499 (2,058)
---------- ----------- ---------- ------- ------- -------
LONG-TERM DEBT:
FIRST MORTGAGE BONDS 3,020,400
OTHER LONG-TERM DEBT - NET 548,729 165,004 488,783
LONG-TERM DEBT OF ASSOCIATED COMPANIES 694,097 71,423
---------- ----------- ---------- ------- ------- -------
TOTAL LONG-TERM DEBT 548,729 3,185,404 1,182,880 0 0 71,423
---------- ----------- ---------- ------- ------- -------
TOTAL CAPITALIZATION 3,918,055 7,487,695 930,330 13,297 37,499 69,365
---------- ----------- ---------- ------- ------- -------
CURRENT LIABILITIES:
NOTES PAYABLE 423,291
NOTES PAYABLE TO ASSOCIATED COMPANIES 259,600 140,300 600
ACCOUNTS PAYABLE 7,096 268,874 52,798 1,155 2,910
ACCOUNTS PAYABLE TO ASSOCIATED COMPANIES 1,870 10,936 922 8,868 883
TAXES ACCRUED (28,630) 60,211 2,216 (1,402) (473) 831
INTEREST ACCRUED 8,795 64,732 95,153 9 1
DIVIDENDS ACCRUED 98,469
ACCRUED LIABILITIES TO MUNICIPALITIES 21,307
CURRENT PORTION OF LONG-TERM DEBT AND
PREFERRED STOCK 49,475 15,797
OTHER 2,599 124,817 2,779 102
---------- ----------- ---------- ------- ------- -------
TOTAL CURRENT LIABILITIES 773,090 600,352 309,965 (1,402) 10,159 4,727
---------- ----------- ---------- ------- ------- -------
DEFERRED CREDITS:
ACCUMULATED DEFERRED INCOME TAXES (19,876) 1,876,300 308,628 121 (948) (11)
UNAMORTIZED INVESTMENT TAX CREDIT 411,580 3,196
OTHER 47,913 475,054 2,686 226 4,470 54
---------- ----------- ---------- ------- ------- -------
TOTAL DEFERRED CREDITS 28,037 2,762,934 314,510 347 3,522 43
---------- ----------- ---------- ------- ------- -------
TOTAL $4,719,182 $10,850,981 $1,554,805 $12,242 $51,180 $74,135
========== =========== ========== ======= ======= =======
</TABLE>
19 of 39
<PAGE>
<TABLE>
<CAPTION>
HOUSTON INDUSTRIES INCORPORATED & SUBSIDIARIES EXHIBIT A-2
CONSOLIDATING BALANCE SHEET--LIABILITIES
DECEMBER 31, 1994
(THOUSANDS OF DOLLARS)
ELIMINATIONS/
HIDI HIPI URS PFI RECLASSIFICATION CONSOLIDATED
-------- ---- ------ ---- ---------------- ------------
<S> <C> <C> <C> <C> <C> <C>
LIABILITIES AND STOCKHOLDERS' EQUITY:
SHAREHOLDERS' EQUITY:
COMMON STOCK $151,002 $350 $6,160 $5 ($2,640,750) $2,437,638
UNEARNED ESOP SHARES (289,611)
RETAINED EARNINGS 40 (368) (3,313) (4,344) (1,134,084) 1,221,221
PREFERRED STOCK 473,255
-------- ---- ------ ---- ----------- -----------
TOTAL SHAREHOLDERS' EQUITY 151,042 (18) 2,847 (4,339) (3,774,834) 3,842,503
-------- ---- ------ ---- ----------- -----------
LONG-TERM DEBT:
FIRST MORTGAGE BONDS 3,020,400
OTHER LONG-TERM DEBT - NET 1,202,516
LONG-TERM DEBT OF ASSOCIATED COMPANIES (765,520)
-------- ---- ------ ---- ----------- -----------
TOTAL LONG-TERM DEBT 0 0 0 0 (765,520) 4,222,916
-------- ---- ------ ---- ----------- -----------
TOTAL CAPITALIZATION 151,042 (18) 2,847 (4,339) (4,540,354) 8,065,419
-------- ---- ------ ---- ----------- -----------
CURRENT LIABILITIES:
NOTES PAYABLE 423,291
NOTES PAYABLE TO ASSOCIATED COMPANIES 3,083 (403,583)
ACCOUNTS PAYABLE 22 332,855
ACCOUNTS PAYABLE TO ASSOCIATED COMPANIES 523 40 (24,042)
TAXES ACCRUED (9) (66) (650) 2,491 14,339 48,858
INTEREST ACCRUED (86,373) 82,317
DIVIDENDS ACCRUED 6,716 105,185
ACCRUED LIABILITIES TO MUNICIPALITIES 21,307
CURRENT PORTION OF LONG-TERM DEBT AND
PREFERRED STOCK 65,272
OTHER 22 1,392 (6,717) 124,994
-------- ---- ------ ---- ----------- -----------
TOTAL CURRENT LIABILITIES (9) 501 2,473 3,883 (499,660) 1,204,079
-------- ---- ------ ---- ----------- -----------
DEFERRED CREDITS:
ACCUMULATED DEFERRED INCOME TAXES 348 456 (85,547) 2,079,471
UNAMORTIZED INVESTMENT TAX CREDIT 414,776
OTHER (1) 530,402
-------- ---- ------ ---- ----------- -----------
TOTAL DEFERRED CREDITS 0 0 348 456 (85,548) 3,024,649
-------- ---- ------ ---- ----------- -----------
TOTAL $151,033 $483 $5,668 $0 ($5,125,562) $12,294,147
======== ==== ====== ==== =========== ===========
</TABLE>
20 of 39
<PAGE>
<TABLE>
<CAPTION>
KBLCOM INCORPORATED AND SUBSIDIARIES
CONSOLIDATING STATEMENT OF INCOME AND RETAINED EARNINGS (DEFICIT)
TWELVE MONTHS ENDED DECEMBER 31, 1994
(THOUSANDS OF DOLLARS)
KBL KBL KBL
KBLCOM KBL CABLE, INC. KBL VENTURES COMMUNICATIONS, INTEGRATED
INCORPORATED CONSOLIDATED PROPERTIES, INC. INCORPORATED INC. SERVICES, INC.
-----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
OPERATING REVENUES $247,941 $16
-----------------------------------------------------------------------------------------------
OPERATING EXPENSES:
CABLE TELEVISION $7,892 143,447 $9 483
DEPRECIATION AND AMORTIZATION 890 81,040 $170 $3 106
-----------------------------------------------------------------------------------------------
TOTAL 8,782 224,487 170 3 9 589
-----------------------------------------------------------------------------------------------
OPERATING INCOME (LOSS) (8,782) 23,454 (170) (3) (9) (573)
-----------------------------------------------------------------------------------------------
OTHER INCOME (EXPENSE) - NET (2,752) 2,349 (59) 35,405
-----------------------------------------------------------------------------------------------
FIXED CHARGES:
INTEREST ON LONG-TERM DEBT 17 41,900
OTHER INTEREST (33,125) 41,727 321 347 447
-----------------------------------------------------------------------------------------------
TOTAL FIXED CHARGES (33,108) 83,627 321 347 447 0
-----------------------------------------------------------------------------------------------
INCOME (LOSS) BEFORE INCOME TAXES 21,574 (57,824) (491) (409) 34,949 (573)
-----------------------------------------------------------------------------------------------
INCOME TAXES 7,559 (27,860) (170) 1,467 16,192 (194)
-----------------------------------------------------------------------------------------------
EARNINGS (LOSS) FOR COMMON STOCK 14,015 (29,964) (321) (1,876) 18,757 (379)
EQUITY IN EARNINGS (LOSS) OF
SUBSIDIARIES (51,412)
DIVIDENDS ON PREFERRED STOCK HELD
BY PARENT
INTEREST ON NOTE HELD BY PARENT
(NET OF TAX BENEFIT OF $24,963) (46,169)
-----------------------------------------------------------------------------------------------
NET CHANGE TO RETAINED EARNINGS
(DEFICIT) (83,566) (29,964) (321) (1,876) 18,757 (379)
-----------------------------------------------------------------------------------------------
RETAINED EARNINGS (DEFICIT) AT
BEGINNING OF PERIOD (755,925) (458,930) 209 (1,966) (17,150) (44)
ADJUSTMENT TO BEGINNING RETAINED
EARNINGS (DEFICIT) (4)
-----------------------------------------------------------------------------------------------
RETAINED EARNINGS (DEFICIT) AT
BEGINNING OF PERIOD - ADJUSTED (755,925) (458,934) 209 (1,966) (17,150) (44)
-----------------------------------------------------------------------------------------------
RETAINED EARNINGS (DEFICIT) AT
END OF PERIOD ($839,491) ($488,898) ($112) ($3,842) $1,607 ($423)
===============================================================================================
EARNINGS (LOSS) PER COMMON SHARE (1) $0.11 ($0.24) ($0.00) ($0.02) $0.15 ($0.00)
===============================================================================================
(1) BASED ON WEIGHTED AVERAGE COMMON
SHARES OUTSTANDING OF HOUSTON
INDUSTRIES INCORPORATED (000'S) - 122,853
</TABLE>
21 of 39
<PAGE>
<TABLE>
<CAPTION>
KBLCOM INCORPORATED AND SUBSIDIARIES
CONSOLIDATING STATEMENT OF INCOME AND RETAINED EARNINGS (DEFICIT)
TWELVE MONTHS ENDED DECEMBER 31, 1994
(THOUSANDS OF DOLLARS)
NORTEL CABLE COUNTRYSIDE
FIBRCOM MINNESOTA CABLE CORPORATION INVESTMENTS,
INCORPORATED PROPERTIES, INC. CONSOLIDATED INC.
------------- ---------------- ------------- -------------
<S> <C> <C> <C> <C>
OPERATING REVENUES $1,505 $185 $4,745
------------- ---------------- ------------- -------------
OPERATING EXPENSES:
CABLE TELEVISION 1,095 38 2,683
DEPRECIATION AND AMORTIZATION 339 73 1,695
------------- ---------------- ------------- -------------
TOTAL 1,434 111 4,378 0
------------- ---------------- ------------- -------------
OPERATING INCOME (LOSS) 71 74 367 0
------------- ---------------- ------------- -------------
OTHER INCOME (EXPENSE) - NET (513) 2 4
------------- ---------------- ------------- -------------
FIXED CHARGES:
INTEREST ON LONG-TERM DEBT 8
OTHER INTEREST 179
------------- ---------------- ------------- -------------
TOTAL FIXED CHARGES 179 0 8 0
------------- ---------------- ------------- -------------
INCOME (LOSS) BEFORE INCOME TAXES (621) 76 363 0
------------- ---------------- ------------- -------------
INCOME TAXES (202) 30 168 $33
------------- ---------------- ------------- -------------
EARNINGS (LOSS) FOR COMMON STOCK (419) 46 195 (33)
EQUITY IN EARNINGS (LOSS) OF SUBSIDIARIES 61
DIVIDENDS ON PREFERRED STOCK HELD BY PARENT
INTEREST ON NOTE HELD BY PARENT (NET OF TAX BENEFIT OF $24,963)
------------- ---------------- ------------- -------------
NET CHANGE TO RETAINED EARNINGS (DEFICIT) (419) 46 195 28
------------- ---------------- ------------- -------------
RETAINED EARNINGS (DEFICIT) AT BEGINNING OF PERIOD (177) 0 0 0
ADJUSTMENT TO BEGINNING RETAINED EARNINGS (DEFICIT)
------------- ---------------- ------------- -------------
RETAINED EARNINGS (DEFICIT) AT BEGINNING OF PERIOD - ADJUSTED (177) 0 0 0
------------- ---------------- ------------- -------------
RETAINED EARNINGS (DEFICIT) AT END OF PERIOD ($596) $46 $195 $28
============= ================ ============= =============
EARNINGS (LOSS) PER COMMON SHARE (1) ($0.00) $0.00 $0.00 ($0.00)
============= ================ ============= =============
(1) BASED ON WEIGHTED AVERAGE COMMON SHARES OUTSTANDING
OF HOUSTON INDUSTRIES INCORPORATED (000'S) - 122,853
</TABLE>
<TABLE>
<CAPTION>
AMZAK CABLE, ELIMINATIONS/
MIDWEST, INC. RECLASSIFICATION CONSOLIDATED
------------- ---------------- -------------
<S> <C> <C> <C>
OPERATING REVENUES $1,378 $2 $255,772
------------- ---------------- -------------
OPERATING EXPENSES:
CABLE TELEVISION 438 (1) 156,084
DEPRECIATION AND AMORTIZATION 719 (354) 84,681
------------- ---------------- -------------
TOTAL 1,157 (355) 240,765
------------- ---------------- -------------
OPERATING INCOME (LOSS) 221 357 15,007
------------- ---------------- -------------
OTHER INCOME (EXPENSE) - NET 6 (7) 34,435
------------- ---------------- -------------
FIXED CHARGES:
INTEREST ON LONG-TERM DEBT (2) 356 42,279
OTHER INTEREST 1 9,897
TOTAL FIXED CHARGES (2) 357 52,176
------------- ---------------- -------------
INCOME (LOSS) BEFORE INCOME TAXES 229 (7) (2,734)
------------- ---------------- -------------
INCOME TAXES 126 0 (2,851)
------------- ---------------- -------------
EARNINGS (LOSS) FOR COMMON STOCK 103 (7) 117
EQUITY IN EARNINGS (LOSS) OF SUBSIDIARIES 51,351
DIVIDENDS ON PREFERRED STOCK HELD BY PARENT
INTEREST ON NOTE HELD BY PARENT (NET OF TAX BENEFIT OF $24,963) (46,169)
------------- ---------------- -------------
NET CHANGE TO RETAINED EARNINGS (DEFICIT) 103 51,344 (46,052)
------------- ---------------- -------------
RETAINED EARNINGS (DEFICIT) AT BEGINNING OF PERIOD 0 289,357 (944,626)
ADJUSTMENT TO BEGINNING RETAINED EARNINGS (DEFICIT) 4
------------- ---------------- -------------
RETAINED EARNINGS (DEFICIT) AT BEGINNING OF PERIOD - ADJUSTED 0 289,361 (944,626)
------------- ---------------- -------------
RETAINED EARNINGS (DEFICIT) AT END OF PERIOD $103 $340,705 ($990,678)
============= ================ =============
EARNINGS (LOSS) PER COMMON SHARE (1) $0.00 $0.00
============= ================ =============
(1) BASED ON WEIGHTED AVERAGE COMMON SHARES OUTSTANDING
OF HOUSTON INDUSTRIES INCORPORATED (000'S) - 122,853
</TABLE>
22 of 39
<PAGE>
<TABLE>
<CAPTION>
KBLCOM INCORPORATED AND SUBSIDIARIES
CONSOLIDATING BALANCE SHEET
DECEMBER 31, 1994
(THOUSANDS OF DOLLARS)
KBL
KBLCOM KBL CABLE, INC. KBL VENTURES
INCORPORATED CONSOLIDATED PROPERTIES, INC. INCORPORATED
------------ -------------- ---------------- ------------
<S> <C> <C> <C> <C>
ASSETS:
CURRENT ASSETS:
CASH AND CASH EQUIVALENTS ($9,508) $2,889
ACCOUNTS RECEIVABLE - OTHER 646,360 (483,716) ($2,205) ($9,814)
ACCOUNTS RECEIVABLE - CUSTOMER 6,142
INVENTORIES 9,625
OTHER 212 2,775
------------ -------------- ---------------- ------------
TOTAL CURRENT ASSETS 637,064 (462,285) (2,205) (9,814)
------------ -------------- ---------------- ------------
PROPERTY, PLANT AND EQUIPMENT 4,243 393,828 4,999
ACCUMULATED DEPRECIATION (2,037) (156,388) (925)
------------ -------------- ---------------- ------------
NET PROPERTY, PLANT AND EQUIPMENT 2,206 237,440 4,074 0
------------ -------------- ---------------- ------------
OTHER ASSETS:
CABLE TELEVISION INVESTMENT
INVESTMENT IN ASSOCIATED COMPANIES 263,209 8,221
FRANCHISES & INTANGIBLE ASSETS 944,016 46
DEFERRED DEBITS AND OTHER INVESTMENTS (44,342) 103,126 (122) 198
------------ -------------- ---------------- ------------
TOTAL OTHER ASSETS 218,867 1,047,142 (76) 8,419
------------ -------------- ---------------- ------------
TOTAL $858,137 $822,297 $1,793 ($1,395)
============ ============== ================ ============
LIABILITIES AND STOCKHOLDERS' EQUITY:
STOCKHOLDERS' EQUITY:
COMMON STOCK $738,132 $564,169 $2,039 $1
RETAINED EARNINGS (DEFICIT) (839,491) (488,902) (112) (3,842)
PREFERRED STOCK
------------ -------------- ---------------- ------------
TOTAL STOCKHOLDERS' EQUITY (101,359) 75,267 1,927 (3,841)
------------ -------------- ---------------- ------------
LONG-TERM DEBT:
LONG-TERM DEBT 504,580
LONG-TERM DEBT OF ASSOCIATED COMPANIES 694,097
------------ -------------- ---------------- ------------
TOTAL LONG-TERM DEBT 694,097 504,580 0 0
------------ -------------- ---------------- ------------
TOTAL CAPITALIZATION 592,738 579,847 1,927 (3,841)
------------ -------------- ---------------- ------------
CURRENT LIABILITIES:
ACCOUNTS PAYABLE 90,655 44,212 1 4,041
ACCOUNTS PAYABLE TO ASSOCIATED COMPANIES
ADVANCED PAYMENTS
NOTES PAYABLE TO ASSOCIATED COMPANIES 172,300 (32,000)
INTEREST PAYABLE TO ASSOCIATED COMPANIES
CURRENT PORTION OF LONG-TERM DEBT
OTHER 2,630
------------ -------------- ---------------- ------------
TOTAL CURRENT LIABILITIES 262,955 14,842 1 4,041
------------ -------------- ---------------- ------------
DEFERRED CREDITS:
ACCUMULATED DEFERRED INCOME TAXES 2,035 223,525 (135) (1,595)
UNAMORTIZED INVESTMENT TAX CREDIT 2,213
OTHER 409 1,870
------------ -------------- ---------------- ------------
TOTAL DEFERRED CREDITS 2,444 227,608 (135) (1,595)
------------ -------------- ---------------- ------------
TOTAL $858,137 $822,297 $1,793 ($1,395)
============ ============== ================ ============
</TABLE>
<TABLE>
<CAPTION>
KBL KBL
COMMUNICATIONS INTEGRATED
INC. SERVICES, INC.
------------ --------------
<S> <C> <C>
ASSETS:
CURRENT ASSETS:
CASH AND CASH EQUIVALENTS $2
ACCOUNTS RECEIVABLE - OTHER ($90,064) (1,745)
ACCOUNTS RECEIVABLE - CUSTOMER 11
INVENTORIES
OTHER 12
------------ --------------
TOTAL CURRENT ASSETS (90,064) (1,720)
------------ --------------
PROPERTY, PLANT AND EQUIPMENT 1,675
ACCUMULATED DEPRECIATION (95)
------------ --------------
NET PROPERTY, PLANT AND EQUIPMENT 0 1,580
------------ --------------
OTHER ASSETS:
CABLE TELEVISION INVESTMENT
INVESTMENT IN ASSOCIATED COMPANIES 156,198
FRANCHISES & INTANGIBLE ASSETS
DEFERRED DEBITS AND OTHER INVESTMENTS (7,036) 82
------------ --------------
TOTAL OTHER ASSETS 149,162 82
------------ --------------
TOTAL $59,098 ($58)
============ ==============
LIABILITIES AND STOCKHOLDERS' EQUITY:
STOCKHOLDERS' EQUITY:
COMMON STOCK $1 $1
RETAINED EARNINGS (DEFICIT) 1,607 (423)
PREFERRED STOCK
------------ --------------
TOTAL STOCKHOLDERS' EQUITY 1,608 (422)
------------ --------------
LONG-TERM DEBT:
LONG-TERM DEBT
LONG-TERM DEBT OF ASSOCIATED COMPANIES
------------ --------------
TOTAL LONG-TERM DEBT 0 0
------------ --------------
TOTAL CAPITALIZATION 1,608 (422)
------------ --------------
CURRENT LIABILITIES:
ACCOUNTS PAYABLE 80 264
ACCOUNTS PAYABLE TO ASSOCIATED COMPANIES
ADVANCED PAYMENTS
NOTES PAYABLE TO ASSOCIATED COMPANIES
INTEREST PAYABLE TO ASSOCIATED COMPANIES
CURRENT PORTION OF LONG-TERM DEBT
OTHER 2
------------ --------------
TOTAL CURRENT LIABILITIES 80 266
------------ --------------
DEFERRED CREDITS:
ACCUMULATED DEFERRED INCOME TAXES 56,427 98
UNAMORTIZED INVESTMENT TAX CREDIT 983
OTHER
------------ --------------
TOTAL DEFERRED CREDITS 57,410 98
------------ --------------
TOTAL $59,098 ($58)
============ ==============
</TABLE>
23 of 39
<PAGE>
<TABLE>
<CAPTION>
KBLCOM INCORPORATED AND SUBSIDIARIES
CONSOLIDATING BALANCE SHEET
DECEMBER 31, 1994
(THOUSANDS OF DOLLARS)
NORTEL CABLE COUNTRYSIDE
FIBRCOM MINNESOTA CABLE CORPORATION INVESTMENTS,
INCORPORATED PROPERTIES, INC. CONSOLIDATED INC.
---------------- ---------------- ------------- ------------
<S> <C> <C> <C> <C>
ASSETS:
CURRENT ASSETS:
CASH AND CASH EQUIVALENTS $13 $75
ACCOUNTS RECEIVABLE - OTHER (11,088) $48 (44,575) $3,144
ACCOUNTS RECEIVABLE - CUSTOMER 263 10 356
INVENTORIES 326
OTHER 388 74
---------------- ---------------- ------------- ------------
TOTAL CURRENT ASSETS (10,098) 58 (44,070) 3,144
---------------- ---------------- ------------- ------------
PROPERTY, PLANT AND EQUIPMENT 7,636 1,071 17,951
ACCUMULATED DEPRECIATION (468) (53) (1,125)
---------------- ---------------- ------------- ------------
NET PROPERTY, PLANT AND EQUIPMENT 7,168 1,018 16,826 0
---------------- ---------------- ------------- ------------
OTHER ASSETS:
CABLE TELEVISION INVESTMENT
INVESTMENT IN ASSOCIATED COMPANIES 3,805 61
FRANCHISES & INTANGIBLE ASSETS 1,775 47,048
DEFERRED DEBITS AND OTHER INVESTMENTS 249 32 513
---------------- ---------------- ------------- ------------
TOTAL OTHER ASSETS 4,054 1,807 47,561 61
---------------- ---------------- ------------- ------------
TOTAL $1,124 $2,883 $20,317 $3,205
================ ================ ============= ============
LIABILITIES AND STOCKHOLDERS' EQUITY:
STOCKHOLDERS' EQUITY:
COMMON STOCK $1 $2,137 $4,345
RETAINED EARNINGS (DEFICIT) (596) 46 195 $28
PREFERRED STOCK
---------------- ---------------- ------------- ------------
TOTAL STOCKHOLDERS' EQUITY (595) 2,183 4,540 28
---------------- ---------------- ------------- ------------
LONG-TERM DEBT:
LONG-TERM DEBT
LONG-TERM DEBT OF ASSOCIATED COMPANIES
---------------- ---------------- ------------- ------------
TOTAL LONG-TERM DEBT 0 0 0 0
---------------- ---------------- ------------- ------------
TOTAL CAPITALIZATION (595) 2,183 4,540 28
---------------- ---------------- ------------- ------------
CURRENT LIABILITIES:
ACCOUNTS PAYABLE 1,409 51 1,453
ACCOUNTS PAYABLE TO ASSOCIATED COMPANIES
ADVANCED PAYMENTS
NOTES PAYABLE TO ASSOCIATED COMPANIES
INTEREST PAYABLE TO ASSOCIATED COMPANIES
CURRENT PORTION OF LONG-TERM DEBT
OTHER 4 4 105
---------------- ---------------- ------------- ------------
TOTAL CURRENT LIABILITIES 1,413 55 1,558 0
---------------- ---------------- ------------- ------------
DEFERRED CREDITS:
ACCUMULATED DEFERRED INCOME TAXES 260 645 13,859 3,177
UNAMORTIZED INVESTMENT TAX CREDIT
OTHER 46 360
---------------- ---------------- ------------- ------------
TOTAL DEFERRED CREDITS 306 645 14,219 3,177
---------------- ---------------- ------------- ------------
TOTAL $1,124 $2,883 $20,317 $3,205
================ ================ ============= ============
</TABLE>
<TABLE>
<CAPTION>
AMZAK CABLE, ELIMINATIONS/
MIDWEST, INC. RECLASSIFICATIONS CONSOLIDATED
------------- ----------------- ------------
<S> <C> <C> <C>
ASSETS:
CURRENT ASSETS:
CASH AND CASH EQUIVALENTS ($2) $6,531
ACCOUNTS RECEIVABLE - OTHER (1,194) 2,218 $7,369
ACCOUNTS RECEIVABLE - CUSTOMER 91 6,873
INVENTORIES 1 9,952
OTHER 3 2 3,466
------------- ----------------- ------------
TOTAL CURRENT ASSETS (1,102) 8,752 27,660
------------- ----------------- ------------
PROPERTY, PLANT AND EQUIPMENT 6,620 3 438,026
ACCUMULATED DEPRECIATION (309) (2) (161,402)
------------- ----------------- ------------
NET PROPERTY, PLANT AND EQUIPMENT 6,311 1 276,624
------------- ----------------- ------------
OTHER ASSETS:
CABLE TELEVISION INVESTMENT
INVESTMENT IN ASSOCIATED COMPANIES (271,131) 160,363
FRANCHISES & INTANGIBLE ASSETS 36,553 2 1,029,440
DEFERRED DEBITS AND OTHER INVESTMENTS 158 7,860 60,718
------------- ----------------- ------------
TOTAL OTHER ASSETS 36,711 (263,269) 1,250,521
------------- ----------------- ------------
TOTAL $41,920 ($254,516) $1,554,805
============= ================= ============
LIABILITIES AND STOCKHOLDERS' EQUITY:
STOCKHOLDERS' EQUITY:
COMMON STOCK $29,778 ($602,472) $738,132
RETAINED EARNINGS (DEFICIT) 103 340,705 (990,682)
PREFERRED STOCK 1,500 (1,500)
------------- ----------------- ------------
TOTAL STOCKHOLDERS' EQUITY 31,381 (263,267) (252,550)
------------- ----------------- ------------
LONG-TERM DEBT:
LONG-TERM DEBT (15,797) 488,783
LONG-TERM DEBT OF ASSOCIATED COMPANIES 694,097
------------- ----------------- ------------
TOTAL LONG-TERM DEBT 0 (15,797) 1,182,880
------------- ----------------- ------------
TOTAL CAPITALIZATION 31,381 (279,064) 930,330
------------- ----------------- ------------
CURRENT LIABILITIES:
ACCOUNTS PAYABLE 177 (87,329) 55,014
ACCOUNTS PAYABLE TO ASSOCIATED COMPANIES 922 922
ADVANCED PAYMENTS
NOTES PAYABLE TO ASSOCIATED COMPANIES 140,300
INTEREST PAYABLE TO ASSOCIATED COMPANIES 95,153 95,153
CURRENT PORTION OF LONG-TERM DEBT 15,797 15,797
OTHER 32 2 2,779
------------- ----------------- ------------
TOTAL CURRENT LIABILITIES 209 24,545 309,965
------------- ----------------- ------------
DEFERRED CREDITS:
ACCUMULATED DEFERRED INCOME TAXES 10,330 2 308,628
UNAMORTIZED INVESTMENT TAX CREDIT 3,196
OTHER 1 2,686
------------- ----------------- ------------
TOTAL DEFERRED CREDITS 10,330 3 314,510
------------- ----------------- ------------
TOTAL $41,920 ($254,516) $1,554,805
============= ================= ============
</TABLE>
24 of 39
<PAGE>
<TABLE>
<CAPTION>
NORTEL CABLE CORPORATION
CONSOLIDATING STATEMENT OF INCOME AND RETAINED EARNINGS (DEFICIT)
TWELVE MONTHS ENDED DECEMBER 31, 1994
(THOUSANDS OF DOLLARS)
NORTEL CABLE NORTEL CABLE ELIMINATIONS/
CORPORATION ASSOCIATES RECLASSIFICATION CONSOLIDATED
------------- ------------ ---------------- ------------
<S> <C> <C> <C> <C>
OPERATING REVENUES $4,745 $4,745
------------- ------------ ---------------- ------------
OPERATING EXPENSES:
CABLE TELEVISION 2,683 2,683
DEPRECIATION AND AMORTIZATION 1,695 1,695
------------- ------------ ---------------- ------------
TOTAL 0 4,378 0 4,378
------------- ------------ ---------------- ------------
OPERATING INCOME (LOSS) 0 367 0 367
------------- ------------ ---------------- ------------
OTHER INCOME (EXPENSE) - NET 4 4
------------- ------------ ---------------- ------------
FIXED CHARGES:
INTEREST ON LONG-TERM DEBT 8 8
OTHER INTEREST
------------- ------------ ---------------- ------------
TOTAL FIXED CHARGES 0 8 0 8
------------- ------------ ---------------- ------------
INCOME (LOSS) BEFORE INCOME TAXES 0 363 0 363
------------- ------------ ---------------- ------------
INCOME TAXES $161 7 168
------------- ------------ ---------------- ------------
EARNINGS (LOSS) FOR COMMON STOCK (161) 356 0 195
EQUITY IN EARNINGS (LOSS) OF SUBSIDIARIES 296 ($296)
------------- ------------ ---------------- ------------
NET CHANGE TO RETAINED EARNINGS (DEFICIT) 135 356 (296) 195
RETAINED EARNINGS (DEFICIT) AT BEGINNING OF PERIOD 0 0 0 0
------------- ------------ ---------------- ------------
RETAINED EARNINGS (DEFICIT) AT END OF PERIOD $135 $356 ($296) $195
------------- ------------ ---------------- ------------
EARNINGS (LOSS) PER COMMON SHARE (1) ($0.00) $0.00 $0.00
============= ============ ================ ============
(1) BASED ON WEIGHTED AVERAGE COMMON SHARES OUTSTANDING
OF HOUSTON INDUSTRIES INCORPORATED (000'S) - 122,853
</TABLE>
25 of 39
<PAGE>
<TABLE>
<CAPTION>
NORTEL CABLE CORPORATION
CONSOLIDATING BALANCE SHEET
DECEMBER 31, 1994
(THOUSANDS OF DOLLARS)
NORTEL CABLE NORTEL CABLE ELIMINATIONS/
CORPORATION ASSOCIATES RECLASSIFICATION CONSOLIDATED
------------- ------------ ---------------- ------------
<S> <C> <C> <C> <C>
ASSETS:
CURRENT ASSETS:
CASH AND CASH EQUIVALENTS $75 $75
ACCOUNTS RECEIVABLE - OTHER $16,235 (60,810) (44,575)
ACCOUNTS RECEIVABLE - CUSTOMER (2) 358 356
INVENTORIES
OTHER 74 74
------- ------ ------ -------
TOTAL CURRENT ASSETS 16,233 (60,303) 0 (44,070)
------- ------ ------ -------
PROPERTY, PLANT AND EQUIPMENT 17,951 17,951
ACCUMULATED DEPRECIATION (1,125) (1,125)
------- ------ ------ -------
NET PROPERTY, PLANT AND EQUIPMENT 0 16,826 0 16,826
------- ------ ------ -------
OTHER ASSETS:
CABLE TELEVISION INVESTMENT
INVESTMENT IN ASSOCIATED COMPANIES 296 ($296)
FRANCHISES & INTANGIBLE ASSETS (1,543) 48,591 47,048
DEFERRED DEBITS AND OTHER INVESTMENTS 513 513
------- ------ ------ -------
TOTAL OTHER ASSETS (1,247) 49,104 (296) 47,561
------- ------ ------ -------
TOTAL $14,986 $5,627 ($296) $20,317
======= ====== ====== =======
LIABILITIES AND STOCKHOLDERS' EQUITY:
STOCKHOLDERS' EQUITY:
COMMON STOCK $988 $3,357 $4,345
RETAINED EARNINGS (DEFICIT) 135 356 ($296) 195
------- ------ ------ -------
TOTAL STOCKHOLDERS' EQUITY 1,123 3,713 (296) 4,540
------- ------ ------ -------
LONG-TERM DEBT:
LONG-TERM DEBT
LONG-TERM DEBT OF ASSOCIATED COMPANIES
------- ------ ------ -------
TOTAL LONG-TERM DEBT 0 0 0 0
------- ------ ------ -------
TOTAL CAPITALIZATION 1,123 3,713 (296) 4,540
------- ------ ------ -------
CURRENT LIABILITIES:
ACCOUNTS PAYABLE 4 1,449 1,453
ACCOUNTS PAYABLE TO ASSOCIATED COMPANIES
ADVANCED PAYMENTS
NOTES PAYABLE TO ASSOCIATED COMPANIES
INTEREST PAYABLE TO ASSOCIATED COMPANIES
OTHER 105 105
------- ------ ------ -------
TOTAL CURRENT LIABILITIES 4 1,554 0 1,558
------- ------ ------ -------
DEFERRED CREDITS:
ACCUMULATED DEFERRED INCOME TAXES 13,859 13,859
UNAMORTIZED INVESTMENT TAX CREDIT
OTHER 360 360
------- ------ ------ -------
TOTAL DEFERRED CREDITS 13,859 360 0 14,219
------- ------ ------ -------
TOTAL $14,986 $5,627 ($296) $20,317
======= ====== ====== =======
</TABLE>
26 of 39
<PAGE>
<TABLE>
<CAPTION>
KBL CABLE, INC. AND SUBSIDIARIES
CONSOLIDATING STATEMENT OF INCOME AND RETAINED EARNINGS (DEFICIT)
TWELVE MONTHS ENDED DECEMBER 31, 1994
(THOUSANDS OF DOLLARS)
KBL
CABLESYSTEMS
OF THE
KBL SOUTHWEST, INC. KBL - TV ELIMINATIONS/
CABLE, INC. CONSOLIDATED INCORPORATED RECLASSIFICATION CONSOLIDATED
----------- --------------- ------------ ---------------- ------------
<S> <C> <C> <C> <C> <C>
OPERATING REVENUES $236,100 $11,841 $247,941
--------- --------- ------- -------- ---------
OPERATING EXPENSES:
CABLE TELEVISION ($1,152) 134,812 9,787 143,447
DEPRECIATION AND AMORTIZATION 5,304 74,737 999 81,040
--------- --------- ------- -------- ---------
TOTAL 4,152 209,549 10,786 0 224,487
--------- --------- ------- -------- ---------
OPERATING INCOME (LOSS) (4,152) 26,551 1,055 0 23,454
--------- --------- ------- -------- ---------
OTHER INCOME (EXPENSE) - NET 610 1,739 2,349
--------- --------- ------- -------- ---------
FIXED CHARGES:
INTEREST ON LONG-TERM DEBT 42,765 (865) 41,900
OTHER INTEREST (3,246) 44,042 931 41,727
--------- --------- ------- -------- ---------
TOTAL FIXED CHARGES 39,519 43,177 931 0 83,627
--------- --------- ------- -------- ---------
INCOME (LOSS) BEFORE INCOME TAXES (43,061) (14,887) 124 0 (57,824)
--------- --------- ------- -------- ---------
INCOME TAXES (27,786) (74) (27,860)
--------- --------- ------- -------- ---------
EARNINGS (LOSS) FOR COMMON STOCK (15,275) (14,813) 124 0 (29,964)
EQUITY IN EARNINGS (LOSS) OF SUBSIDIARIES (57,590) $57,590
DIVIDENDS ON PREFERRED STOCK HELD BY PARENT 60,000 (60,000)
--------- --------- ------- -------- ---------
NET CHANGE TO RETAINED EARNINGS (DEFICIT) (12,865) (74,813) 124 57,590 (29,964)
--------- --------- ------- -------- ---------
RETAINED EARNINGS (DEFICIT) AT BEGINNING
OF PERIOD (446,097) (268,688) (4,442) 260,293 (458,934)
ADJUSTMENT TO BEGINNING RETAINED EARNINGS
(DEFICIT) (4) (4)
--------- --------- ------- -------- ---------
RETAINED EARNINGS (DEFICIT) AT BEGINNING
OF PERIOD - ADJUSTED (446,097) (268,692) (4,442) 260,293 (458,938)
--------- --------- ------- -------- ---------
RETAINED EARNINGS (DEFICIT) AT END
OF PERIOD ($458,962) ($343,505) ($4,318) $317,883 ($488,902)
========= ========= ======= ======== =========
EARNINGS (LOSS) PER COMMON SHARE (1) ($0.12) ($0.12) $0.00 ($0.24)
========= ========= ======= ======== =========
(1) BASED ON WEIGHTED AVERAGE COMMON SHARES OUTSTANDING
OF HOUSTON INDUSTRIES INCORPORATED (000'S) - 122,853
</TABLE>
27 of 39
<PAGE>
<TABLE>
<CAPTION>
KBL CABLE, INC. AND SUBSIDIARIES
CONSOLIDATING BALANCE SHEET
DECEMBER 31, 1994
(THOUSANDS OF DOLLARS)
KBL
CABLESYSTEMS
OF THE
KBL SOUTHWEST, INC. KBL - TV ELIMINATIONS/
CABLE, INC. CONSOLIDATED INCORPORATED RECLASSIFICATION CONSOLIDATED
----------- --------------- ------------ ---------------- ------------
<S> <C> <C> <C> <C> <C>
ASSETS:
CURRENT ASSETS:
CASH AND CASH EQUIVALENTS $61 $2,267 $561 $2,889
ACCOUNTS RECEIVABLE - OTHER 189,463 (668,084) (5,095) (483,716)
ACCOUNTS RECEIVABLE - CUSTOMER 6,538 (396) 6,142
INVENTORIES 9,625 9,625
OTHER 2,646 129 2,775
--------- -------- ------- --------- --------
TOTAL CURRENT ASSETS 189,524 (647,008) (4,801) 0 (462,285)
--------- -------- ------- --------- --------
PROPERTY, PLANT AND EQUIPMENT 27,267 360,902 5,659 393,828
ACCUMULATED DEPRECIATION (19,239) (133,476) (3,673) (156,388)
--------- -------- ------- --------- --------
NET PROPERTY, PLANT AND EQUIPMENT 8,028 227,426 1,986 0 237,440
--------- -------- ------- --------- --------
OTHER ASSETS:
CABLE TELEVISION INVESTMENT
INVESTMENT IN ASSOCIATED COMPANIES 543,102 ($543,102)
FRANCHISES & INTANGIBLE ASSETS 20,010 924,006 944,016
DEFERRED DEBITS AND OTHER INVESTMENT 101,666 1,416 44 103,126
--------- -------- ------- --------- --------
TOTAL OTHER ASSETS 664,778 925,422 44 (543,102) 1,047,142
--------- -------- ------- --------- --------
TOTAL $862,330 $505,840 ($2,771) ($543,102) $822,297
========= ======== ======= ========= ========
LIABILITIES AND STOCKHOLDERS' EQUITY:
STOCKHOLDERS' EQUITY:
PREFERRED STOCK $600,000 ($600,000)
COMMON STOCK $564,169 260,984 $1 (260,985) $564,169
RETAINED EARNINGS (DEFICIT) (458,962) (343,505) (4,318) 317,883 (488,902)
--------- -------- ------- --------- --------
TOTAL STOCKHOLDERS' EQUITY 105,207 517,479 (4,317) (543,102) 75,267
--------- -------- ------- --------- --------
LONG-TERM DEBT:
LONG-TERM DEBT 504,580 504,580
LONG-TERM DEBT OF ASSOCIATED COMPANIES
--------- -------- ------- --------- --------
TOTAL LONG-TERM DEBT 504,580 0 0 0 504,580
--------- -------- ------- --------- --------
TOTAL CAPITALIZATION 609,787 517,479 (4,317) (543,102) 579,847
--------- -------- ------- --------- --------
CURRENT LIABILITIES:
ACCOUNTS PAYABLE 26,805 16,145 1,262 44,212
ACCOUNTS PAYABLE TO ASSOCIATED COMPANIES
ADVANCED PAYMENTS
NOTES PAYABLE TO AFFILIATED COMPANIES (32,000) (32,000)
INTEREST PAYABLE TO ASSOCIATED COMPANIES
OTHER 2,523 107 2,630
--------- -------- ------- --------- --------
TOTAL CURRENT LIABILITIES 26,805 (13,332) 1,369 0 14,842
--------- -------- ------- --------- --------
DEFERRED CREDITS:
ACCUMULATED DEFERRED INCOME TAXES 223,525 223,525
UNAMORTIZED INVESTMENT TAX CREDIT 2,213 2,213
OTHER 1,693 177 1,870
--------- -------- ------- --------- --------
TOTAL DEFERRED CREDITS 225,738 1,693 177 0 227,608
--------- -------- ------- --------- --------
TOTAL $862,330 $505,840 ($2,771) ($543,102) $822,297
========= ======== ======= ========= ========
</TABLE>
28 of 39
<PAGE>
<TABLE>
<CAPTION>
KBL CABLESYSTEMS OF THE SOUTHWEST, INC. AND SUBSIDIARIES
CONSOLIDATING STATEMENT OF INCOME AND RETAINED EARNINGS (DEFICIT)
TWELVE MONTHS ENDED DECEMBER 31, 1994
(THOUSANDS OF DOLLARS)
KBL KBL
KBL CABLESYSTEMS CABLESYSTEMS
CABLESYSTEMS OF MULTNOMAH, OF MINNEAPOLIS, TVE
OF THE INC. INC. KBL CABLE TRANSMISSION,
SOUTHWEST, INC. CONSOLIDATED CONSOLIDATED TV, INC. INC.
---------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
OPERATING REVENUES $168,627 $19,176 $25,752 $17
---------------------------------------------------------------------------
OPERATING EXPENSES:
CABLE TELEVISION 94,791 10,711 15,873 10
DEPRECIATION AND AMORTIZATION 45,741 5,229 7,833 16
---------------------------------------------------------------------------
TOTAL 140,532 15,940 23,706 0 26
---------------------------------------------------------------------------
OPERATING INCOME (LOSS) 28,095 3,236 2,046 0 (9)
---------------------------------------------------------------------------
OTHER INCOME (EXPENSE) - NET 2,164 54 (75)
---------------------------------------------------------------------------
FIXED CHARGES:
INTEREST ON LONG-TERM DEBT (790) (25) (41)
OTHER INTEREST (2,334) 8,346 13,798 ($1)
---------------------------------------------------------------------------
TOTAL FIXED CHARGES (3,124) 8,321 13,757 (1) 0
---------------------------------------------------------------------------
INCOME (LOSS) BEFORE INCOME TAXES 33,383 (5,031) (11,786) 1 (9)
---------------------------------------------------------------------------
INCOME TAXES 13 (6) 5 (0)
---------------------------------------------------------------------------
EARNINGS (LOSS) FOR COMMON STOCK 33,370 (5,025) (11,791) 1 (9)
EQUITY IN EARNINGS (LOSS) OF SUBSIDIARIES (48,121) (285)
DIVIDENDS ON PREFERRED STOCK HELD BY PARENT (60,000)
---------------------------------------------------------------------------
NET CHANGE TO RETAINED EARNINGS (DEFICIT) (74,751) (5,025) (11,791) (284) (9)
---------------------------------------------------------------------------
RETAINED EARNINGS (DEFICIT) AT BEGINNING OF PERIOD (272,823) (26,763) (58,702) (1,563) 91
ADJUSTMENT TO BEGINNING RETAINED EARNINGS (DEFICIT)
--------------------------------------------------------------------------
RETAINED EARNINGS (DEFICIT) AT BEGINNING
OF PERIOD - ADJUSTED (272,823) (26,763) (58,702) (1,563) 91
---------------------------------------------------------------------------
RETAINED EARNINGS (DEFICIT) AT END OF PERIOD ($347,574) ($31,788) ($70,493) ($1,847) $82
===========================================================================
EARNINGS (LOSS) PER COMMON SHARE (1) $0.27 ($0.04) ($0.10) $0.00 ($0.00)
===========================================================================
(1) BASED ON WEIGHTED AVERAGE COMMON SHARES OUTSTANDING
OF HOUSTON INDUSTRIES INCORPORATED (000'S) - 122,853
</TABLE>
<TABLE>
<CAPTION>
DICKINSON
PACIFIC KBL-PORTLAND ELIMINATIONS/
CABLESYSTEMS CABLESYSTEMS LP RECLASSIFICATION CONSOLIDATED
----------------------------------------------------------------
<S> <C> <C> <C> <C>
OPERATING REVENUES $22,528 $236,100
----------------------------------------------------------------
OPERATING EXPENSES:
CABLE TELEVISION 13,427 134,812
DEPRECIATION AND AMORTIZATION $7,196 8,722 74,737
----------------------------------------------------------------
TOTAL 7,196 22,149 0 209,549
----------------------------------------------------------------
OPERATING INCOME (LOSS) (7,196) 379 0 26,551
----------------------------------------------------------------
OTHER INCOME (EXPENSE) - NET (325) ($79) 1,739
----------------------------------------------------------------
FIXED CHARGES:
INTEREST ON LONG-TERM DEBT (9) (865)
OTHER INTEREST 13,312 10,921 44,042
----------------------------------------------------------------
TOTAL FIXED CHARGES 13,312 10,912 0 43,177
----------------------------------------------------------------
INCOME (LOSS) BEFORE INCOME TAXES (20,508) (10,858) (79) (14,887)
----------------------------------------------------------------
INCOME TAXES (86) (74)
----------------------------------------------------------------
EARNINGS (LOSS) FOR COMMON STOCK (20,508) (10,772) (79) (14,813)
EQUITY IN EARNINGS (LOSS) OF SUBSIDIARIES 48,406
DIVIDENDS ON PREFERRED STOCK HELD BY PARENT (60,000)
----------------------------------------------------------------
NET CHANGE TO RETAINED EARNINGS (DEFICIT) (20,508) (10,772) 48,327 (74,813)
----------------------------------------------------------------
RETAINED EARNINGS (DEFICIT) AT BEGINNING OF PERIOD (69,149) (44,500) 204,721 (268,688)
ADJUSTMENT TO BEGINNING RETAINED EARNINGS (DEFICIT) (4) (4)
----------------------------------------------------------------
RETAINED EARNINGS (DEFICIT) AT BEGINNING OF
PERIOD - ADJUSTED (69,149) (44,500) 204,717 (268,692)
----------------------------------------------------------------
RETAINED EARNINGS (DEFICIT) AT END OF PERIOD ($89,657) ($55,272) $253,044 ($343,505)
================================================================
EARNINGS (LOSS) PER COMMON SHARE (1) ($0.16) ($0.09) ($0.12)
================================================================
(1) BASED ON WEIGHTED AVERAGE COMMON SHARES OUTSTANDING
OF HOUSTON INDUSTRIES INCORPORATED (000'S) -
</TABLE>
29 of 39
<PAGE>
<TABLE>
<CAPTION>
KBL CABLESYSTEMS OF THE SOUTHWEST, INC. AND SUBSIDIARIES
CONSOLIDATING BALANCE SHEET
DECEMBER 31, 1994
(THOUSANDS OF DOLLARS)
KBL KBL
KBL CABLESYSTEMS CABLESYSTEMS
CABLESYSTEMS OF MULTNOMAH, OF MINNEAPOLIS,
OF THE INC. INC. KBL CABLE
SOUTHWEST, INC. CONSOLIDATED CONSOLIDATED TV, INC.
----------------------------------------------------------------
<S> <C> <C> <C> <C>
ASSETS:
CURRENT ASSETS:
CASH AND CASH EQUIVALENTS $1,579 $47
ACCOUNTS RECEIVABLE - OTHER (50,194) ($101,620) (189,523) ($139)
ACCOUNTS RECEIVABLE - CUSTOMER 4,017 815 1,499
INVENTORIES 7,584 (8) 982
OTHER 1,926 0 238
----------------------------------------------------------------
TOTAL CURRENT ASSETS (35,088) (100,813) (186,757) (139)
----------------------------------------------------------------
PROPERTY, PLANT AND EQUIPMENT 222,133 26,307 46,701
ACCUMULATED DEPRECIATION (71,941) (8,997) (20,374)
----------------------------------------------------------------
NET PROPERTY, PLANT AND EQUIPMENT 150,192 17,310 26,327 0
----------------------------------------------------------------
OTHER ASSETS:
CABLE TELEVISION INVESTMENT
INVESTMENT IN ASSOCIATED COMPANIES (203,855) (233) (1,477)
FRANCHISES & INTANGIBLE ASSETS 582,617 60,985 106,594
DEFERRED DEBITS AND OTHER INVESTMENTS 990 219
----------------------------------------------------------------
TOTAL OTHER ASSETS 379,752 60,752 106,813 (1,477)
----------------------------------------------------------------
TOTAL $494,856 ($22,751) ($53,617) ($1,616)
================================================================
LIABILITIES AND STOCKHOLDERS' EQUITY:
STOCKHOLDERS' EQUITY:
PREFERRED STOCK $600,000
COMMON STOCK 260,983 $8,832 $13,101 $231
RETAINED EARNINGS (DEFICIT) (347,574) (31,788) (70,493) (1,847)
----------------------------------------------------------------
TOTAL STOCKHOLDERS' EQUITY 513,409 (22,956) (57,392) (1,616)
----------------------------------------------------------------
LONG-TERM DEBT:
LONG-TERM DEBT
LONG-TERM DEBT OF ASSOCIATED COMPANIES
----------------------------------------------------------------
TOTAL LONG-TERM DEBT 0 0 0 0
----------------------------------------------------------------
TOTAL CAPITALIZATION 513,409 (22,956) (57,392) (1,616)
----------------------------------------------------------------
CURRENT LIABILITIES:
ACCOUNTS PAYABLE 10,125 343 3,707
ACCOUNTS PAYABLE TO ASSOCIATED COMPANIES
ADVANCED PAYMENTS
NOTES PAYABLE TO ASSOCIATED COMPANIES (32,000)
INTEREST PAYABLE TO ASSOCIATED COMPANIES
OTHER 1,629 (138) 68
----------------------------------------------------------------
TOTAL CURRENT LIABILITIES (20,246) 205 3,775 0
----------------------------------------------------------------
DEFERRED CREDITS:
ACCUMULATED DEFERRED INCOME TAXES
UNAMORTIZED INVESTMENT TAX CREDIT
OTHER 1,693
----------------------------------------------------------------
TOTAL DEFERRED CREDITS 1,693 0 0 0
----------------------------------------------------------------
TOTAL $494,856 ($22,751) ($53,617) ($1,616)
================================================================
</TABLE>
<TABLE>
<CAPTION>
TVE DICKINSON
TRANSMISSION, PACIFIC KBL-PORTLAND ELIMINATIONS/
INC. CABLESYSTEMS CABLESYSTEMS LP RECLASSIFICATION CONSOLIDATED
--------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
ASSETS:
CURRENT ASSETS:
CASH AND CASH EQUIVALENTS $641 $2,267
ACCOUNTS RECEIVABLE - OTHER ($342) ($181,521) (144,745) (668,084)
ACCOUNTS RECEIVABLE - CUSTOMER 207 6,538
INVENTORIES 1,067 9,625
OTHER 482 2,646
--------------------------------------------------------------------------------
TOTAL CURRENT ASSETS (342) (181,521) (142,348) 0 (647,008)
--------------------------------------------------------------------------------
PROPERTY, PLANT AND EQUIPMENT 479 25,364 39,918 360,902
ACCUMULATED DEPRECIATION (54) (15,526) (16,584) (133,476)
--------------------------------------------------------------------------------
NET PROPERTY, PLANT AND EQUIPMENT 425 9,838 23,334 0 227,426
--------------------------------------------------------------------------------
OTHER ASSETS:
CABLE TELEVISION INVESTMENT
INVESTMENT IN ASSOCIATED COMPANIES $205,565
FRANCHISES & INTANGIBLE ASSETS 96,168 77,642 924,006
DEFERRED DEBITS AND OTHER INVESTMENTS 207 1,416
--------------------------------------------------------------------------------
TOTAL OTHER ASSETS 0 96,168 77,849 205,565 925,422
--------------------------------------------------------------------------------
TOTAL $83 ($75,515) ($41,165) $205,565 $505,840
================================================================================
LIABILITIES AND STOCKHOLDERS' EQUITY:
STOCKHOLDERS' EQUITY:
PREFERRED STOCK $600,000
COMMON STOCK $1 $14,142 $11,715 (48,021) 260,984
RETAINED EARNINGS (DEFICIT) 82 (89,657) (55,272) 253,044 (343,505)
--------------------------------------------------------------------------------
TOTAL STOCKHOLDERS' EQUITY 83 (75,515) (43,557) 205,023 517,479
--------------------------------------------------------------------------------
LONG-TERM DEBT:
LONG-TERM DEBT
LONG-TERM DEBT OF ASSOCIATED COMPANIES
--------------------------------------------------------------------------------
TOTAL LONG-TERM DEBT 0 0 0 0 0
--------------------------------------------------------------------------------
TOTAL CAPITALIZATION 83 (75,515) (43,557) 205,023 517,479
--------------------------------------------------------------------------------
CURRENT LIABILITIES:
ACCOUNTS PAYABLE 1,970 16,145
ACCOUNTS PAYABLE TO ASSOCIATED COMPANIES
ADVANCED PAYMENTS
NOTES PAYABLE TO ASSOCIATED COMPANIES (32,000)
INTEREST PAYABLE TO ASSOCIATED COMPANIES
OTHER 422 542 2,523
--------------------------------------------------------------------------------
TOTAL CURRENT LIABILITIES 0 0 2,392 542 (13,332)
--------------------------------------------------------------------------------
DEFERRED CREDITS:
ACCUMULATED DEFERRED INCOME TAXES
UNAMORTIZED INVESTMENT TAX CREDIT
OTHER 1,693
--------------------------------------------------------------------------------
TOTAL DEFERRED CREDITS 0 0 0 0 1,693
--------------------------------------------------------------------------------
TOTAL $83 ($75,515) ($41,165) $205,565 $505,840
================================================================================
</TABLE>
30 of 39
<PAGE>
<TABLE>
<CAPTION>
KBL CABLESYSTEMS OF MULTNOMAH, INC.
CONSOLIDATING STATEMENT OF INCOME AND RETAINED EARNINGS (DEFICIT)
TWELVE MONTHS ENDED DECEMBER 31, 1994
(THOUSANDS OF DOLLARS)
KBL
CABLESYSTEMS
OF MULTNOMAH, KBL - MULTNOMAH ELIMINATIONS/
INC. CABLESYSTEMS LP RECLASSIFICATION CONSOLIDATED
-----------------------------------------------------------------
<S> <C> <C> <C> <C>
OPERATING REVENUES $19,176 $19,176
-----------------------------------------------------------------
OPERATING EXPENSES:
CABLE TELEVISION 10,711 10,711
DEPRECIATION AND AMORTIZATION 5,229 5,229
-----------------------------------------------------------------
TOTAL 0 15,940 0 15,940
-----------------------------------------------------------------
OPERATING INCOME (LOSS) 0 3,236 0 3,236
-----------------------------------------------------------------
OTHER INCOME (EXPENSE) - NET 5 $49 54
-----------------------------------------------------------------
FIXED CHARGES:
INTEREST ON LONG-TERM DEBT (25) (25)
OTHER INTEREST $133 8,213 8,346
-----------------------------------------------------------------
TOTAL FIXED CHARGES 133 8,188 0 8,321
-----------------------------------------------------------------
INCOME (LOSS) BEFORE INCOME TAXES (133) (4,947) 49 (5,031)
-----------------------------------------------------------------
INCOME TAXES (6) (6)
-----------------------------------------------------------------
EARNINGS (LOSS) FOR COMMON STOCK (133) (4,941) 49 (5,025)
EQUITY IN EARNINGS (LOSS) OF SUBSIDIARIES (5,000) 5,000
-----------------------------------------------------------------
NET CHANGE TO RETAINED EARNINGS (DEFICIT) (5,133) (4,941) 5,049 (5,025)
RETAINED EARNINGS (DEFICIT) AT BEGINNING OF PERIOD (26,952) (26,467) 26,656 (26,763)
-----------------------------------------------------------------
RETAINED EARNINGS (DEFICIT) AT END OF PERIOD ($32,085) ($31,408) $31,705 ($31,788)
=================================================================
EARNINGS (LOSS) PER COMMON SHARE (1) ($0.00) ($0.04) ($0.04)
=================================================================
(1) BASED ON WEIGHTED AVERAGE COMMON SHARES OUTSTANDING
OF HOUSTON INDUSTRIES INCORPORATED (000'S) - 122,853
</TABLE>
31 of 39
<PAGE>
<TABLE>
<CAPTION>
KBL CABLESYSTEMS OF MULTNOMAH, INC.
CONSOLIDATING BALANCE SHEET
DECEMBER 31, 1994
(THOUSANDS OF DOLLARS)
KBL
CABLESYSTEMS
OF MULTNOMAH, KBL - MULTNOMAH ELIMINATIONS/
INC. CABLESYSTEMS LP RECLASSIFICATION CONSOLIDATED
-----------------------------------------------------------------
<S> <C> <C> <C> <C>
ASSETS:
CURRENT ASSETS:
CASH AND CASH EQUIVALENTS
ACCOUNTS RECEIVABLE - OTHER ($445) ($101,175) ($101,620)
ACCOUNTS RECEIVABLE - CUSTOMER 815 815
INVENTORIES (8) (8)
OTHER
-----------------------------------------------------------------
TOTAL CURRENT ASSETS (445) (100,368) 0 (100,813)
-----------------------------------------------------------------
PROPERTY, PLANT AND EQUIPMENT 26,307 26,307
ACCUMULATED DEPRECIATION (8,997) (8,997)
-----------------------------------------------------------------
NET PROPERTY, PLANT AND EQUIPMENT 0 17,310 0 17,310
-----------------------------------------------------------------
OTHER ASSETS:
CABLE TELEVISION INVESTMENT
INVESTMENT IN ASSOCIATED COMPANIES (22,787) $22,554 (233)
FRANCHISES & INTANGIBLE ASSETS 8 60,977 60,985
DEFERRED DEBITS AND OTHER INVESTMENTS
-----------------------------------------------------------------
TOTAL OTHER ASSETS (22,779) 60,977 22,554 60,752
-----------------------------------------------------------------
TOTAL ($23,224) ($22,081) $22,554 ($22,751)
=================================================================
LIABILITIES AND STOCKHOLDERS' EQUITY:
STOCKHOLDERS' EQUITY:
COMMON STOCK $8,861 $8,832 ($8,861) $8,832
RETAINED EARNINGS (DEFICIT) (32,085) (31,408) 31,705 (31,788)
-----------------------------------------------------------------
TOTAL STOCKHOLDERS' EQUITY (23,224) (22,576) 22,844 (22,956)
-----------------------------------------------------------------
LONG-TERM DEBT:
LONG-TERM DEBT
LONG-TERM DEBT OF ASSOCIATED COMPANIES
-----------------------------------------------------------------
TOTAL LONG-TERM DEBT 0 0 0 0
-----------------------------------------------------------------
TOTAL CAPITALIZATION (23,224) (22,576) 22,844 (22,956)
-----------------------------------------------------------------
CURRENT LIABILITIES:
ACCOUNTS PAYABLE 343 343
ACCOUNTS PAYABLE TO ASSOCIATED COMPANIES
ADVANCED PAYMENTS
NOTES PAYABLE TO ASSOCIATED COMPANIES
INTEREST PAYABLE TO ASSOCIATED COMPANIES
OTHER 152 (290) (138)
-----------------------------------------------------------------
TOTAL CURRENT LIABILITIES 0 495 (290) 205
-----------------------------------------------------------------
DEFERRED CREDITS:
ACCUMULATED DEFERRED INCOME TAXES
UNAMORTIZED INVESTMENT TAX CREDIT
OTHER
-----------------------------------------------------------------
TOTAL DEFERRED CREDITS 0 0 0 0
-----------------------------------------------------------------
TOTAL ($23,224) ($22,081) $22,554 ($22,751)
=================================================================
</TABLE>
32 of 39
<PAGE>
<TABLE>
<CAPTION>
KBL CABLESYSTEMS OF MINNEAPOLIS, INC.
CONSOLIDATING STATEMENT OF INCOME AND RETAINED EARNINGS (DEFICIT)
TWELVE MONTHS ENDED DECEMBER 31, 1994
(THOUSANDS OF DOLLARS)
KBL
CABLESYSTEMS KBL
OF MINNEAPOLIS, CABLESYSTEMS OF ELIMINATIONS/
INC. MINNEAPOLIS LP RECLASSIFICATION CONSOLIDATED
-------------------------------------------------------------------
<S> <C> <C> <C> <C>
OPERATING REVENUES $25,752 $25,752
-------------------------------------------------------------------
OPERATING EXPENSES:
CABLE TELEVISION 15,873 15,873
DEPRECIATION AND AMORTIZATION $2,094 5,739 7,833
-------------------------------------------------------------------
TOTAL 2,094 21,612 0 23,706
-------------------------------------------------------------------
OPERATING INCOME (LOSS) (2,094) 4,140 0 2,046
-------------------------------------------------------------------
OTHER INCOME (EXPENSE) - NET 648 (753) $30 (75)
-------------------------------------------------------------------
FIXED CHARGES:
INTEREST ON LONG-TERM DEBT (41) (41)
OTHER INTEREST 8,000 5,798 13,798
-------------------------------------------------------------------
TOTAL FIXED CHARGES 8,000 5,757 0 13,757
-------------------------------------------------------------------
INCOME (LOSS) BEFORE INCOME TAXES (9,446) (2,370) 30 (11,786)
-------------------------------------------------------------------
INCOME TAXES 5 5
-------------------------------------------------------------------
EARNINGS (LOSS) FOR COMMON STOCK (9,446) (2,375) 30 (11,791)
EQUITY IN EARNINGS (LOSS) OF SUBSIDIARIES (12,158) 12,158
-------------------------------------------------------------------
NET CHANGE TO RETAINED EARNINGS (DEFICIT) (21,604) (2,375) 12,188 (11,791)
RETAINED EARNINGS (DEFICIT) AT BEGINNING OF PERIOD (67,510) (52,381) 61,189 (58,702)
-------------------------------------------------------------------
RETAINED EARNINGS (DEFICIT) AT END OF PERIOD ($89,114) ($54,756) $73,377 ($70,493)
===================================================================
EARNINGS (LOSS) PER COMMON SHARE (1) ($0.08) ($0.02) ($0.10)
===================================================================
(1) BASED ON WEIGHTED AVERAGE COMMON SHARES OUTSTANDING
OF HOUSTON INDUSTRIES INCORPORATED (000'S) - 122,853
</TABLE>
33 of 39
<PAGE>
<TABLE>
<CAPTION>
KBL CABLESYSTEMS OF MINNEAPOLIS, INC.
CONSOLIDATING BALANCE SHEET
DECEMBER 31, 1994
(THOUSANDS OF DOLLARS)
KBL
CABLESYSTEMS KBL
OF MINNEAPOLIS, CABLESYSTEMS OF ELIMINATIONS/
INC. MINNEAPOLIS LP RECLASSIFICATION CONSOLIDATED
-------------------------------------------------------------------
<S> <C> <C> <C> <C>
ASSETS:
CURRENT ASSETS:
CASH AND CASH EQUIVALENTS $3 $44 $47
ACCOUNTS RECEIVABLE - OTHER (117,957) (71,566) (189,523)
ACCOUNTS RECEIVABLE - CUSTOMER 1,499 1,499
INVENTORIES 982 982
OTHER 238 238
-------------------------------------------------------------------
TOTAL CURRENT ASSETS (117,954) (68,803) 0 (186,757)
-------------------------------------------------------------------
PROPERTY, PLANT AND EQUIPMENT (28,369) 75,070 46,701
ACCUMULATED DEPRECIATION 20,333 (40,707) (20,374)
------------------------------------------------------------------
NET PROPERTY, PLANT AND EQUIPMENT (8,036) 34,363 0 26,327
------------------------------------------------------------------
OTHER ASSETS:
CABLE TELEVISION INVESTMENT
INVESTMENT IN ASSOCIATED COMPANIES (59,745) $59,745
FRANCHISES & INTANGIBLE ASSETS 104,714 1,880 106,594
DEFERRED DEBITS AND OTHER INVESTMENTS 9 210 219
-------------------------------------------------------------------
TOTAL OTHER ASSETS 44,978 2,090 59,745 106,813
-------------------------------------------------------------------
TOTAL ($81,012) ($32,350) $59,745 ($53,617)
===================================================================
LIABILITIES AND STOCKHOLDERS' EQUITY:
STOCKHOLDERS' EQUITY:
COMMON STOCK $8,097 $18,384 ($13,380) $13,101
RETAINED EARNINGS (DEFICIT) (89,114) (54,756) 73,377 (70,493)
------------------------------------------------------------------
TOTAL STOCKHOLDERS' EQUITY (81,017) (36,372) 59,997 (57,392)
------------------------------------------------------------------
LONG-TERM DEBT:
LONG-TERM DEBT
LONG-TERM DEBT OF ASSOCIATED COMPANIES
------------------------------------------------------------------
TOTAL LONG-TERM DEBT 0 0 0 0
------------------------------------------------------------------
TOTAL CAPITALIZATION (81,017) (36,372) 59,997 (57,392)
-------------------------------------------------------------------
CURRENT LIABILITIES:
ACCOUNTS PAYABLE 5 3,702 3,707
ADVANCED PAYMENTS
NOTES PAYABLE TO ASSOCIATED COMPANIES
INTEREST PAYABLE TO ASSOCIATED COMPANIES
OTHER 320 (252) 68
------------------------------------------------------------------
TOTAL CURRENT LIABILITIES 5 4,022 (252) 3,775
------------------------------------------------------------------
DEFERRED CREDITS:
ACCUMULATED DEFERRED INCOME TAXES
UNAMORTIZED INVESTMENT TAX CREDIT
OTHER
-------------------------------------------------------------------
TOTAL DEFERRED CREDITS 0 0 0 0
-------------------------------------------------------------------
TOTAL ($81,012) ($32,350) $59,745 ($53,617)
===================================================================
</TABLE>
34 of 39
<PAGE>
<TABLE>
<CAPTION>
HOUSTON INDUSTRIES ENERGY, INC. AND SUBSIDIARIES
CONSOLIDATING STATEMENT OF INCOME AND RETAINED EARNINGS
TWELVE MONTHS ENDED DECEMBER 31, 1994
(THOUSANDS OF DOLLARS)
HOUSTON
HOUSTON INDUSTRIES
INDUSTRIES ENERGY - HIE FORD HOUSTON ELIMINATIONS/
ENERGY, INC. DEER PARK, INC. HEIGHTS, INC. ARGENTINA S.A. RECLASSIFICATION CONSOLIDATED
------------- --------------- ------------- -------------- ---------------- ------------
<S> <C> <C> <C> <C> <C> <C>
OPERATING EXPENSES:
DEPRECIATION & AMORTIZATION $121 $121
--------- ------- ------ ----- ------ --------
TOTAL 121 0 0 0 0 121
--------- ------- ------ ----- ------ --------
OPERATING INCOME (LOSS) (121) 0 0 0 0 (121)
--------- ------- ------ ----- ------ --------
OTHER INCOME (EXPENSE) - NET (10,317) ($14) $852 $796 $91 (8,592)
--------- ------- ------ ----- ------ --------
FIXED CHARGES:
OTHER INTEREST 72 72
--------- ------- ------ ----- ------ --------
TOTAL FIXED CHARGES 0 0 0 0 72 72
--------- ------- ------ ----- ------ --------
INCOME (LOSS) BEFORE INCOME TAXES (10,438) (14) 852 796 19 (8,785)
INCOME TAXES (3,636) (5) 298 708 (3) (2,638)
--------- ------- ------ ----- ------ --------
NET INCOME (LOSS) (6,802) (9) 554 88 22 (6,147)
--------- ------- ------ ----- ------ --------
NET INCREASE (DECREASE) IN RETAINED
EARNINGS (6,802) (9) 554 88 22 (6,147)
RETAINED EARNINGS (DEFICIT) AT
BEGINNING OF PERIOD (1,841) 181 (1,660)
ADJUSTMENT TO BEGINNING RETAINED
EARNINGS (DEFICIT) (2) (298) 320 (22)
--------- ------- ------ ----- ------ --------
RETAINED EARNINGS (DEFICIT) AT END
OF PERIOD ($8,941) ($9) $554 $589 $0 ($7,807)
========= ======= ====== ===== ====== ========
EARNINGS (LOSS) PER COMMON SHARE (1) ($0.05) ($0.00) $0.00 $0.00 ($0.05)
========= ======= ====== ===== ====== ========
(1) BASED ON WEIGHTED AVERAGE COMMON
SHARES OUTSTANDING OF HOUSTON
INDUSTRIES INCORPORATED (000) - 122,853
(2) RETAINED EARNINGS HAS BEEN ADJUSTED
TO REFLECT THE TRANSFER OF CERTAIN COSTS
FROM HOUSTON ARGENTINA S.A. TO HOUSTON
INDUSTRIES ENERGY, INC.
</TABLE>
35 of 39
<PAGE>
<TABLE>
<CAPTION>
HOUSTON INDUSTRIES ENERGY, INC. AND SUBSIDIARIES
CONSOLIDATING BALANCE SHEET - ASSETS
DECEMBER 31, 1994
(THOUSANDS OF DOLLARS)
HOUSTON
HOUSTON INDUSTRIES
INDUSTRIES ENERGY - HIE FORD HOUSTON ELIMINATIONS/
ENERGY, INC. DEER PARK, INC. HEIGHTS, INC. ARGENTINA S.A. RECLASSIFICATION CONSOLIDATED
------------- -------------- ------------- -------------- ---------------- ------------
<S> <C> <C> <C> <C> <C> <C>
ASSETS:
PROPERTY, PLANT, AND EQUIPMENT,
AT COST:
OTHER PROPERTY $231 $58 $289
------- ------ ------ ------- ------- -------
TOTAL PROPERTY, PLANT AND
EQUIPMENT 231 0 0 0 58 289
LESS: ACCUMULATED DEPRECIATION
AND AMORTIZATION 58 58
------- ------ ------ ------- ------- -------
PROPERTY, PLANT AND
EQUIPMENT - NET 231 0 0 0 0 231
------- ------ ------ ------- ------- -------
CURRENT ASSETS:
CASH AND CASH EQUIVALENTS (92) $1 $928 $1,152 (901) 1,088
ACCOUNTS RECEIVABLE - CUSTOMERS 873 (873)
ACCOUNTS RECEIVABLE - OTHER 1,824 41 173 9,674 11,712
ACCOUNTS RECEIVABLE FROM
ASSOCIATED COMPANIES 248 464 (496) 216
NOTES RECEIVABLE FROM
ASSOCIATED COMPANIES 7,198 (7,198)
OTHER 1,465 (1,355) 110
------- ------ ------ ------- ------- -------
TOTAL CURRENT ASSETS 10,051 42 1,101 3,081 (1,149) 13,126
------- ------ ------ ------- ------- -------
OTHER ASSETS:
DEFERRED DEBITS 2,642 300 (568) 2,374
EQUITY INVESTMENT IN CGE-L.L.C. 400 400 (800)
EQUITY INVESTMENT IN FOREIGN
ELECTRIC UTILITY 35,449 35,449
------- ------ ------ ------- ------- -------
TOTAL OTHER ASSETS 3,042 0 400 35,749 (1,368) 37,823
------- ------ ------ ------- ------- -------
TOTAL $13,324 $42 $1,501 $38,830 ($2,517) $51,180
======= ====== ====== ======= ======= =======
</TABLE>
36 of 39
<PAGE>
<TABLE>
<CAPTION>
HOUSTON INDUSTRIES ENERGY, INC. AND SUBSIDIARIES
CONSOLIDATING BALANCE SHEET - LIABILITIES
DECEMBER 31, 1994
(THOUSANDS OF DOLLARS)
HOUSTON
HOUSTON INDUSTRIES
INDUSTRIES ENERGY - HIE FORD HOUSTON ELIMINATIONS/
ENERGY, INC. DEER PARK, INC. HEIGHTS, INC. ARGENTINA S.A. RECLASSIFICATION CONSOLIDATED
------------- --------------- ------------- -------------- ---------------- ------------
<S> <C> <C> <C> <C> <C> <C>
LIABILITIES AND STOCKHOLDERS' EQUITY:
SHAREHOLDERS' EQUITY:
COMMON STOCK $7,893 $400 $37,413 ($400) $45,306
RETAINED EARNINGS (8,941) ($9) 554 589 (7,807)
------- --- ------ ------- ------- -------
TOTAL SHAREHOLDERS' EQUITY (1,048) (9) 954 38,002 (400) 37,499
------- --- ------ ------- ------- -------
CURRENT LIABILITIES:
NOTES PAYABLE TO ASSOCIATED
COMPANIES 1,500 (900) 600
ACCOUNTS PAYABLE 856 299 1,155
ACCOUNTS PAYABLE TO ASSOCIATED
COMPANIES 8,812 56 248 (248) 8,868
TAXES ACCRUED (1,296) (5) 299 828 (299) (473)
INTEREST ACCRUED 9 9
------- --- ------ ------- ------- -------
TOTAL CURRENT LIABILITIES 9,881 51 547 828 (1,148) 10,159
------- --- ------ ------- ------- -------
DEFERRED CREDITS:
ACCUMULATED DEFERRED INCOME
TAXES 21 (969) (948)
OTHER 4,470 4,470
------- --- ------ ------- ------- -------
TOTAL DEFERRED CREDITS 4,491 0 0 0 (969) 3,522
------- --- ------ ------- ------- -------
TOTAL $13,324 $42 $1,501 $38,830 ($2,517) $51,180
======= === ====== ======= ======= =======
</TABLE>
37 of 39
<PAGE>
EXHIBIT B
---------
Financial Data Schedule
-----------------------
Houston Industries Incorporated
(Thousands of Dollars)
<TABLE>
<S> <C>
Consolidated Total Assets $12,294,147
Consolidated Total Operating Revenues $ 4,001,857
Consolidated Net Income $ 399,261
</TABLE>
38 of 39
<PAGE>
EXHIBIT C
---------
Organizational Chart of System Companies
----------------------------------------
Houston Industries Incorporated
(a Texas corporation, "Claimant")
Houston Industries Energy, Inc.
(a Delaware corporation, "HI Energy")
Houston Argentina S.A. (100% owned by HI Energy)
(an Argentine corporation, "HI Argentina")
Compania de Inversiones en Electricidad S.A. (32.5% owned by HI Argentina)
(an Argentine corporation, "COINELEC")
Empresa Distribuidora La Plata S.A. (51% owned by COINELEC)
(an Argentine corporation)
Central Dique S.A. (51% owned by COINELEC)
(an Argentine corporation)
Industrias Electricas de Houston S.A. (100% owned by HI Energy) (an Argentine
corporation)
Empresa de Distribuidora de Electricidad de Santiago del Estero S.A. (90%
owned by Industrias Electricas de Houston S.A.) (an Argentine corporation)
39 of 39
<TABLE> <S> <C>
<PAGE>
<ARTICLE> OPUR3
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1994
<PERIOD-START> JAN-01-1994
<PERIOD-END> DEC-31-1994
<BOOK-VALUE> PER-BOOK
<TOTAL-ASSETS> 12,294,147
<TOTAL-OPERATING-REVENUES> 4,001,857
<NET-INCOME> 399,261
</TABLE>
|
|