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SOUTHERN OHIO COAL COMPANY
QUARTERLY REPORT PER REQUIREMENTS
OF HOLDING COMPANY ACT RELEASE NO. 21178
BY MONTH, FOR THE QUARTER ENDED JUNE 30, 1995
<CAPTION>
CONTENTS
Page
<S> <C>
Statements of Income:
Total Company 1
Meigs Division 2
Martinka Division 3
Balance Sheets 4-5
Statements of Retained Earnings 6
Statements of Cost of Commercial Coal Sold and Shipped 7
Analysis of Operating Reserves and Deferred Credits 8
Information Concerning Capital Improvements 9
Analysis of Mining Plant in Service 10
Information Concerning Operations 11
Statements of Cost of Operation 12
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SOUTHERN OHIO COAL COMPANY
TOTAL COMPANY
STATEMENTS OF INCOME
BY MONTH, FOR THE QUARTER ENDED JUNE 30, 1995
(UNAUDITED)
<CAPTION>
Three
Months
Month Ended Ended
April 30, May 31, June 30, June 30,
1995 1995 1995 1995
(in thousands)
<S> <C> <C> <C> <C>
OPERATING REVENUES -
Sales to Parent . . . . . . . . . $17,460 $18,733 $12,941 $49,134
COST OF OPERATION . . . . . . . . . 15,610 16,905 11,023 43,538
OPERATING INCOME. . . . . . . . . . 1,850 1,828 1,918 5,596
INTEREST CHARGES. . . . . . . . . . 503 503 503 1,509
OPERATING INCOME BEFORE FEDERAL
INCOME TAXES. . . . . . . . . . . 1,347 1,325 1,415 4,087
FEDERAL INCOME TAXES ON OPERATIONS. 622 610 610 1,842
NET INCOME FROM OPERATIONS. . . . . 725 715 805 2,245
NONOPERATING INCOME . . . . . . . . 139 148 59 346
NET INCOME. . . . . . . . . . . . . $ 864 $ 863 $ 864 $ 2,591
The common stock of the Company is
wholly owned by Ohio Power Company.
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SOUTHERN OHIO COAL COMPANY
MEIGS DIVISION
STATEMENTS OF INCOME
BY MONTH, FOR THE QUARTER ENDED JUNE 30, 1995
(UNAUDITED)
<CAPTION>
Three
Months
Month Ended Ended
April 30, May 31, June 30, June 30,
1995 1995 1995 1995
(in thousands)
<S> <C> <C> <C> <C>
OPERATING REVENUES -
Sales to Parent . . . . . . . . . $17,460 $18,733 $12,941 $49,134
COST OF OPERATION (including
Depreciation, Depletion and
Amortization of Mining Plant
of $980,000 in April,
$995,000 in May and
$926,000 in June) . . . . . . . . 15,610 16,905 11,023 43,538
OPERATING INCOME. . . . . . . . . . 1,850 1,828 1,918 5,596
NONOPERATING INCOME . . . . . . . . 98 107 18 223
INCOME BEFORE INTEREST CHARGES. . . 1,948 1,935 1,936 5,819
INTEREST CHARGES. . . . . . . . . . 462 462 462 1,386
INCOME BEFORE FEDERAL
INCOME TAXES. . . . . . . . . . . 1,486 1,473 1,474 4,433
FEDERAL INCOME TAXES ON OPERATIONS. 622 610 610 1,842
MEIGS NET INCOME. . . . . . . . . . $ 864 $ 863 $ 864 $ 2,591
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SOUTHERN OHIO COAL COMPANY
MARTINKA DIVISION
STATEMENTS OF INCOME
BY MONTH, FOR THE QUARTER ENDED JUNE 30, 1995
<CAPTION>
Three
Months
Month Ended Ended
April 30, May 31, June 30, June 30,
1995 1995 1995 1995
(in thousands)
NONOPERATING INCOME AND DEDUCTIONS:
<S> <C> <C> <C> <C>
Nonoperating Income -
Interest Income . . . . . . . . . . $296 $290 $ 293 $ 879
Nonoperating Deductions:
Shutdown Costs. . . . . . . . . . . 322 251 439 1,012
Tax Credit. . . . . . . . . . . . . (67) (2) (187) (256)
Net Nonoperating Income . . . . . . . 41 41 41 123
Interest Charges. . . . . . . . . . . 41 41 41 123
MARTINKA NET INCOME . . . . . . . . . $ - $ - $ - $ -
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SOUTHERN OHIO COAL COMPANY
BALANCE SHEETS
BY MONTH-END, FOR THE QUARTER ENDED JUNE 30, 1995
(UNAUDITED)
<CAPTION>
April 30, May 31, June 30,
1995 1995 1995
(in thousands)
ASSETS
<S> <C> <C> <C>
MINING PLANT:
Mining Plant in Service . . . . . . . . . . . . $413,784 $412,609 $405,771
Construction Work in Progress . . . . . . . . . - 126 11
Total Mining Plant . . . . . . . . . . . 413,784 412,735 405,782
Accumulated Depreciation and Amortization . . . 204,449 204,895 199,545
NET MINING PLANT . . . . . . . . . . . . 209,335 207,840 206,237
OTHER PROPERTY AND INVESTMENTS. . . . . . . . . . 65,990 66,143 64,997
CURRENT ASSETS:
Cash and Cash Equivalents . . . . . . . . . . . 6,073 11,107 6,816
Accounts Receivable:
General . . . . . . . . . . . . . . . . . . . 4,408 3,442 4,054
Insurance . . . . . . . . . . . . . . . . . . 13,079 13,079 13,079
Affiliated Companies. . . . . . . . . . . . . 7,815 8,426 8,043
Coal. . . . . . . . . . . . . . . . . . . . . . 855 329 735
Materials and Supplies. . . . . . . . . . . . . 9,626 9,358 9,280
Other . . . . . . . . . . . . . . . . . . . . . 5,113 4,988 4,191
TOTAL CURRENT ASSETS . . . . . . . . . . 46,969 50,729 46,198
REGULATORY ASSETS . . . . . . . . . . . . . . . . 65,818 65,032 66,965
DEFERRED CHARGES. . . . . . . . . . . . . . . . . 4,519 4,447 4,357
TOTAL. . . . . . . . . . . . . . . . . $392,631 $394,191 $388,754
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SOUTHERN OHIO COAL COMPANY
BALANCE SHEETS
BY MONTH-END, FOR THE QUARTER ENDED JUNE 30, 1995
(UNAUDITED)
<CAPTION>
April 30, May 31, June 30,
1995 1995 1995
(in thousands)
CAPITALIZATION AND LIABILITIES
<S> <C> <C> <C>
SHAREHOLDER'S EQUITY:
Common Stock - Par Value $1:
Authorized and Outstanding - 5,000 Shares . . $ 5 $ 5 $ 5
Premium on Common Stock . . . . . . . . . . . . 9,996 9,996 9,996
Other Paid-in Capital . . . . . . . . . . . . . 102,693 102,693 102,693
Retained Earnings . . . . . . . . . . . . . . . 24,064 24,927 23,199
TOTAL SHAREHOLDER'S EQUITY . . . . . . . 136,758 137,621 135,893
LONG-TERM DEBT - Notes Payable to Banks . . . . . 81,681 81,681 81,681
OTHER NONCURRENT LIABILITIES:
Obligations Under Capital Leases. . . . . . . . 25,527 25,007 24,341
Operating Reserves. . . . . . . . . . . . . . . 33,044 33,907 34,441
TOTAL OTHER NONCURRENT LIABILITIES . . . 58,571 58,914 58,782
CURRENT LIABILITIES:
Long-term Debt Due Within One Year . . . . . . . 8,319 8,319 8,319
Accounts Payable:
General . . . . . . . . . . . . . . . . . . . 5,315 5,914 5,131
Affiliated Companies. . . . . . . . . . . . . 1,159 1,102 1,209
Taxes Accrued . . . . . . . . . . . . . . . . . 1,718 2,647 -
Interest Accrued. . . . . . . . . . . . . . . . 1,329 1,828 2,058
Accrued Vacation Pay. . . . . . . . . . . . . . 3,127 3,168 3,064
Workers' Compensation Claims. . . . . . . . . . 9,548 9,331 9,097
Obligations Under Capital Leases. . . . . . . . 10,635 10,531 10,510
Other . . . . . . . . . . . . . . . . . . . . . 7,724 7,067 7,211
TOTAL CURRENT LIABILITIES. . . . . . . . 48,874 49,907 46,599
DEFERRED CREDITS. . . . . . . . . . . . . . . . . 66,747 66,068 65,799
TOTAL. . . . . . . . . . . . . . . . . $392,631 $394,191 $388,754
</TABLE>
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SOUTHERN OHIO COAL COMPANY
STATEMENTS OF RETAINED EARNINGS
BY MONTH, FOR THE QUARTER ENDED JUNE 30, 1995
(UNAUDITED)
<CAPTION>
Three
Months
Month Ended Ended
April 30, May 31, June 30, June 30,
1995 1995 1995 1995
(in thousands)
<S> <C> <C> <C> <C>
BALANCE AT BEGINNING OF PERIOD. . $25,792 $24,064 $24,927 $25,792
NET INCOME. . . . . . . . . . . . 864 863 864 2,591
CASH DIVIDENDS DECLARED . . . . . 2,592 - 2,592 5,184
BALANCE AT END OF PERIOD. . . . . $24,064 $24,927 $23,199 $23,199
</TABLE>
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SOUTHERN OHIO COAL COMPANY
STATEMENTS OF COST OF COMMERCIAL COAL SOLD AND SHIPPED
BY MONTH, FOR THE QUARTER ENDED JUNE 30, 1995
<CAPTION>
April May June
1995 1995 1995
(in thousands, except as noted)
<S> <C> <C> <C>
I. Calculation of Cost-of-Capital Compensation:
A. Investment at Beginning of Month:
Common Stock. . . . . . . . . . . . . . . . . . . . . . . . $ 5 $ 5 $ 5
Premium on Common Stock . . . . . . . . . . . . . . . . . . 9,996 9,996 9,996
Other Paid-in Capital (excluding item D and item G) . . . . 55,233 55,233 55,233
65,234 65,234 65,234
B. Rate of Return Allowable per HCAR Nos. 20515 and
21008: 12.11% per annum, 1.0092% per month. . . . . . . . . .010092 .010092 .010092
C. Earnings Allowable: (re investment in item A)
1. Current Month. . . . . . . . . . . . . . . . . . . . . . $ 658 $ 658 $ 658
2. Year-to-Date . . . . . . . . . . . . . . . . . . . . . . $ 2,632 $ 3,290 $ 3,948
D. Equity Investment for the months of June 1981,
December 1981 and September 1982. . . . . . . . . . . . . . $ 26,240 $ 26,240 $ 26,240
E. Rate of Return Allowable per HCAR Nos. 21008, 21537,
22129 and 22401: 12.04% per annum, 1.0033% per month. . . . .010033 .010033 .010033
F. Earnings Allowable: (re investment in item D)
1. Current Month. . . . . . . . . . . . . . . . . . . . . . $ 264 $ 264 $ 264
2. Year-to-Date . . . . . . . . . . . . . . . . . . . . . . $ 1,056 $ 1,320 $ 1,584
G. Equity Investment for the months of March 1982,
June 1982 and December 1982 . . . . . . . . . . . . . . . . $ 21,220 $ 21,220 $ 21,220
H. Rate of Return Allowable per HCAR Nos. 21008, 21537,
22129 and 22401: 13.58% per annum, 1.1317% per month. . . . .011317 .011317 .011317
I. Earnings Allowable: (re investment in item G)
1. Current Month. . . . . . . . . . . . . . . . . . . . . . $ 240 $ 240 $ 240
2. Year-to-Date . . . . . . . . . . . . . . . . . . . . . . $ 960 $ 1,200 $ 1,440
J. Total Earnings Allowable:
1. Current Month (C.1. + F.1. + I.1.) . . . . . . . . . . . $ 1,162 $ 1,162 $ 1,162
2. Year-to-Date (C.2. + F.2. + I.2.). . . . . . . . . . . . $ 4,648 $ 5,810 $ 6,972
K. Net Income per Statements of Income - Meigs Division (a). . . $ 864 $ 863 $ 864
Add: Interest Charges . . . . . . . . . . . . . . . . . . . 462 462 462
Less: Nonoperating Income . . . . . . . . . . . . . . . . . 98 107 18
L. Applied Cost-of-Capital Billing Adder - Meigs Division:
1. Current Month. . . . . . . . . . . . . . . . . . . . . . $ 1,228 $ 1,218 $ 1,308
2. Year-to-Date . . . . . . . . . . . . . . . . . . . . . . $ 5,136 $ 6,354 $ 7,662
II. Monthly Coal Billing Calculation - Meigs Division:
A. Total Operating Expenses (b). . . . . . . . . . . . . . . . . $ 16,232 $ 17,515 $ 11,633
B. Add: Monthly Cost-of-Capital Billing Adder as Applied
per L. 1. of Section I. . . . . . . . . . . . . . . . . . . 1,228 1,218 1,308
C. Cost Applicable to Current Month Coal Billings (c). . . . . . $ 17,460 $ 18,733 $ 12,941
D. Coal Sold and Shipped in Current Month (in tons)(c) . . . . . 425,325 455,635 318,427
E. Average Price per Ton (in dollars) (C/D)(c) . . . . . . . . . $41.05 $41.11 $40.64
(a) The Company sold its Martinka mining division and most of the Martinka related coal reserves to an unaffiliated
company. No return on equity investment associated with these operations has been billed since the division ceased
mining coal effective July 1, 1992. All results associated with the Martinka division since then are billed to the
Parent Company, Ohio Power Company, eliminating any earnings effect to the Company.
(b) As represented by "Cost of Operation" plus "Federal Income Taxes On Operations" reported in Statements of Income -
Meigs Division.
(c) Sales were to the Parent Company - Ohio Power Company for the Gavin Plant.
/TABLE
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SOUTHERN OHIO COAL COMPANY
ANALYSIS OF OPERATING RESERVES AND DEFERRED CREDITS
BY MONTH-END, FOR THE QUARTER ENDED JUNE 30, 1995
<CAPTION>
April 30, May 31, June 30,
1995 1995 1995
(in thousands)
<S> <C> <C> <C>
Operating Reserves:
Accrued Postretirement Benefits Other
Than Pensions . . . . . . . . . . . . . . . . $16,408 $16,980 $17,552
Workers' Compensation . . . . . . . . . . . . . 10,035 10,329 10,412
Postemployment Benefits . . . . . . . . . . . . 5,647 5,647 5,647
Public Liability Insurance. . . . . . . . . . . 320 329 338
Tunnel Settlement . . . . . . . . . . . . . . . 300 300 300
Martinka Litigation Provision . . . . . . . . . 334 322 192
Total Operating Reserves. . . . . . . . . . $33,044 $33,907 $34,441
Deferred Credits:
Income Taxes. . . . . . . . . . . . . . . . . . $65,623 $65,130 $64,842
Postemployment Benefits . . . . . . . . . . . . 945 936 926
Other . . . . . . . . . . . . . . . . . . . . . 179 2 31
Total Deferred Credits. . . . . . . . . . . $66,747 $66,068 $65,799
</TABLE>
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SOUTHERN OHIO COAL COMPANY
INFORMATION CONCERNING CAPITAL IMPROVEMENTS
FOR THE QUARTER ENDED JUNE 30, 1995
There were no significant changes with regard to the Company s mining
plant during the quarter.
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SOUTHERN OHIO COAL COMPANY
ANALYSIS OF MINING PLANT IN SERVICE
AND RELATED ACCUMULATED PROVISIONS FOR
DEPRECIATION AND AMORTIZATION
BY MONTH-END, FOR THE QUARTER ENDED JUNE 30, 1995
<CAPTION>
April 30, 1995 May 31, 1995 June 30, 1995
Net Net Net
Gross Accumulated Carrying Gross Accumulated Carrying Gross Accumulated Carrying
Cost Provisions Amount Cost Provisions Amount Cost Provisions Amount
(in thousands)
Description
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Surface Lands. . . . . . . . . $ 7,409 $ - $ 7,409 $ 7,409 $ - $ 7,409 $ 7,409 $ - $ 7,409
Mining Structures
and Equipment. . . . . . . . 267,926 158,294 109,632 266,764 158,460 108,304 259,936 152,897 107,039
Coal Interests
(net of depletion) . . . . . 4,300 - 4,300 4,287 - 4,287 4,277 - 4,277
Mine Development Costs . . . . 134,149 46,155 87,994 134,149 46,435 87,714 134,149 46,648 87,501
Total Mining Plant in
Service. . . . . . . . . $413,784 $204,449 $209,335 $412,609 $204,895 $207,714 $405,771 $199,545 $206,226
</TABLE>
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SOUTHERN OHIO COAL COMPANY
INFORMATION CONCERNING OPERATIONS
FOR THE QUARTER ENDED JUNE 30, 1995
There were no significant changes with regard to the Company s operations
during the quarter.
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SOUTHERN OHIO COAL COMPANY
STATEMENTS OF COST OF OPERATION
BY MONTH, FOR THE QUARTER ENDED JUNE 30, 1995
Three
Months
April May June Ended
1995 1995 1995 6/30/95
(in thousands)
<S> <C> <C> <C> <C>
Direct Labor-UMW* . . . . . . . . . . . . . . . . $ 385 $ 463 $ 518 $ 1,366
Indirect Labor-UMW* . . . . . . . . . . . . . . . 1,352 1,493 1,384 4,229
Benefits-UMW* . . . . . . . . . . . . . . . . . . 1,971 2,255 1,815 6,041
Salaries and Benefits-Nonunion. . . . . . . . . . 1,589 1,531 1,463 4,583
Operating Supplies. . . . . . . . . . . . . . . . 736 1,031 937 2,704
Repair Parts and Materials. . . . . . . . . . . . 1,443 1,902 1,644 4,989
Electricity and Other Utilities . . . . . . . . . 518 517 474 1,509
Outside Services-Maintenance, Haulage
and Reclamation . . . . . . . . . . . . . . . . 770 993 963 2,726
Taxes Other Than Federal Income Taxes** . . . . . 707 740 582 2,029
Rental of Equipment . . . . . . . . . . . . . . . 1,497 1,498 1,325 4,320
Depreciation, Depletion and Amortization. . . . . 980 995 926 2,901
Mining Cost Normalization***. . . . . . . . . . . 2,155 1,395 (2,107) 1,443
Other Production Costs. . . . . . . . . . . . . . 1,228 1,566 1,505 4,299
Subtotal. . . . . . . . . . . . . . . . . . . . . 15,331 16,379 11,429 43,139
Transfers of Production Costs (to)/from
Coal Inventory. . . . . . . . . . . . . . . . . 279 526 (406) 399
Total . . . . . . . . . . . . . . . . . $15,610 $16,905 $11,023 $43,538
* United Mine Workers of America.
** Excludes FICA, Federal Unemployment and State Unemployment. These costs are reflected
in employee benefits.
*** Represents the deferral/accrual required to establish a selling price based on
forecasted results for the remainder of the year. The amount of mining cost
normalization is established on an "overall" company basis (i.e., not itemized) and
is eliminated by year-end.
</TABLE>
