<PAGE>
SOUTHERN OHIO COAL COMPANY
QUARTERLY REPORT PER REQUIREMENTS
OF HOLDING COMPANY ACT RELEASE NO. 21178
BY MONTH, FOR THE QUARTER ENDED DECEMBER 31, 1995
CONTENTS
Page
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
Construction Expenditure Budget - 1996 13
<PAGE>
<PAGE>
<TABLE>
SOUTHERN OHIO COAL COMPANY
TOTAL COMPANY
STATEMENTS OF INCOME
BY MONTH, FOR THE QUARTER ENDED DECEMBER 31, 1995
(UNAUDITED)
<CAPTION>
Three
Months
Month Ended Ended
October 31, November 30, December 31, December 31,
1995 1995 1995 1995
(in thousands)
<S> <C> <C> <C> <C>
OPERATING REVENUES -
Sales to Parent . . . . . . . . $18,659 $20,942 $14,548 $54,149
COST OF OPERATION . . . . . . . . 16,836 17,707 13,506 48,049
OPERATING INCOME. . . . . . . . . 1,823 3,235 1,042 6,100
INTEREST CHARGES. . . . . . . . . 493 493 500 1,486
OPERATING INCOME BEFORE FEDERAL
INCOME TAXES. . . . . . . . . . 1,330 2,742 542 4,614
FEDERAL INCOME TAX EXPENSE
(CREDIT) ON OPERATIONS. . . . . 516 1,107 (157) 1,466
NET INCOME FROM OPERATIONS. . . . 814 1,635 699 3,148
NONOPERATING INCOME (LOSS). . . . 50 (771) 166 (555)
NET INCOME. . . . . . . . . . . . $ 864 $ 864 $ 865 $ 2,593
The common stock of the Company is
wholly owned by Ohio Power Company.
</TABLE>
<PAGE>
<PAGE>
<TABLE>
SOUTHERN OHIO COAL COMPANY
MEIGS DIVISION
STATEMENTS OF INCOME
BY MONTH, FOR THE QUARTER ENDED DECEMBER 31, 1995
(UNAUDITED)
<CAPTION>
Three
Months
Month Ended Ended
October 31, November 30, December 31, December 31,
1995 1995 1995 1995
(in thousands)
<S> <C> <C> <C> <C>
OPERATING REVENUES -
Sales to Parent . . . . . . . . $18,659 $20,942 $14,548 $54,149
COST OF OPERATION (including
Depreciation, Depletion and
Amortization of Mining Plant of
$1,341,000 in October, $1,376,000
in November and $1,329,000
in December). . . . . . . . . . 16,836 17,707 13,506 48,049
OPERATING INCOME. . . . . . . . . 1,823 3,235 1,042 6,100
NONOPERATING INCOME (LOSS). . . . 9 (812) 125 (678)
INCOME BEFORE INTEREST CHARGES. . 1,832 2,423 1,167 5,422
INTEREST CHARGES. . . . . . . . . 452 452 459 1,363
INCOME BEFORE FEDERAL
INCOME TAXES. . . . . . . . . . 1,380 1,971 708 4,059
FEDERAL INCOME TAX EXPENSE
(CREDIT) ON OPERATIONS . . . . . 516 1,107 (157) 1,466
MEIGS NET INCOME. . . . . . . . . $ 864 $ 864 $ 865 $ 2,593
</TABLE>
<PAGE>
<PAGE>
<TABLE>
SOUTHERN OHIO COAL COMPANY
MARTINKA DIVISION
STATEMENT OF INCOME
BY MONTH, FOR THE QUARTER ENDED DECEMBER 31, 1995
(UNAUDITED)
<CAPTION>
Three
Months
Month Ended Ended
October 31, November 30, December 31, December 31,
1995 1995 1995 1995
(in thousands)
NONOPERATING INCOME AND DEDUCTIONS:
<S> <C> <C> <C> <C>
Nonoperating Income -
Interest Income . . . . . . . . . $ 334 $294 $ 299 $ 927
Nonoperating Deductions:
Shutdown Costs. . . . . . . . . . 493 334 391 1,218
Tax Credits . . . . . . . . . . . (200) (81) (133) (414)
Net Nonoperating Income . . . . . . 41 41 41 123
Interest Charges. . . . . . . . . . 41 41 41 123
MARTINKA NET INCOME . . . . . . . . $ - $ - $ - $ -
</TABLE>
<PAGE>
<PAGE>
<TABLE>
SOUTHERN OHIO COAL COMPANY
BALANCE SHEETS
BY MONTH-END, FOR THE QUARTER ENDED DECEMBER 31, 1995
(UNAUDITED)
<CAPTION>
October 31, November 30, December 31,
1995 1995 1995
(in thousands)
ASSETS
<S> <C> <C> <C>
MINING PLANT:
Mining Plant in Service . . . . . . . . . . . . $373,268 $370,856 $368,360
Construction Work in Progress . . . . . . . . . 263 287 634
Total Mining Plant . . . . . . . . . . 373,531 371,143 368,994
Accumulated Depreciation and Amortization . . . 183,019 183,003 182,448
NET MINING PLANT. . . . . . . . . . . . 190,512 188,140 186,546
OTHER PROPERTY AND INVESTMENTS. . . . . . . . . . 64,672 64,945 63,790
CURRENT ASSETS:
Cash and Cash Equivalents . . . . . . . . . . . 11,706 23,431 26,535
Accounts Receivable:
General . . . . . . . . . . . . . . . . . . . 3,778 4,415 4,002
Insurance . . . . . . . . . . . . . . . . . . 13,079 13,079 13,079
Affiliated Companies. . . . . . . . . . . . . 11,499 11,146 4,649
Coal. . . . . . . . . . . . . . . . . . . . . . 1,216 856 2,044
Materials and Supplies. . . . . . . . . . . . . 9,514 9,480 10,800
Other . . . . . . . . . . . . . . . . . . . . . 2,530 2,077 1,571
TOTAL CURRENT ASSETS. . . . . . . . . . 53,322 64,484 62,680
REGULATORY ASSETS . . . . . . . . . . . . . . . . 76,751 72,072 69,598
DEFERRED CHARGES. . . . . . . . . . . . . . . . . 4,169 4,913 4,345
TOTAL . . . . . . . . . . . . . . . . $389,426 $394,554 $386,959
</TABLE>
<PAGE>
<PAGE>
<TABLE>
SOUTHERN OHIO COAL COMPANY
BALANCE SHEETS
BY MONTH-END, FOR THE QUARTER ENDED DECEMBER 31, 1995
(UNAUDITED)
<CAPTION>
October 31, November 30, December 31,
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 . . . . . . . . . . . . . . . 24,063 24,927 23,199
TOTAL SHAREHOLDER'S EQUITY. . . . . . . 136,757 137,621 135,893
LONG-TERM DEBT - Notes Payable. . . . . . . . . . 81,681 81,681 81,681
OTHER NONCURRENT LIABILITIES:
Obligations Under Capital Leases. . . . . . . . 23,797 23,651 23,111
Operating Reserves. . . . . . . . . . . . . . . 38,039 38,500 38,924
TOTAL OTHER NONCURRENT LIABILITIES. . . 61,836 62,151 62,035
CURRENT LIABILITIES:
Long-term Debt Due Within One Year. . . . . . . 8,319 8,319 8,319
Accounts Payable:
General . . . . . . . . . . . . . . . . . . . 5,480 8,094 7,800
Affiliated Companies. . . . . . . . . . . . . 1,516 1,507 1,523
Taxes Accrued . . . . . . . . . . . . . . . . . 1,161 1,744 406
Interest Accrued. . . . . . . . . . . . . . . . 1,318 1,806 2,065
Accrued Vacation Pay. . . . . . . . . . . . . . 3,221 2,976 2,728
Workers' Compensation Claims. . . . . . . . . . 9,545 9,380 9,360
Obligations Under Capital Leases. . . . . . . . 11,182 11,034 10,816
Other . . . . . . . . . . . . . . . . . . . . . 3,749 5,003 3,348
TOTAL CURRENT LIABILITIES . . . . . . . 45,491 49,863 46,365
DEFERRED CREDITS. . . . . . . . . . . . . . . . . 63,661 63,238 60,985
TOTAL . . . . . . . . . . . . . . . . $389,426 $394,554 $386,959
</TABLE>
<PAGE>
<PAGE>
<TABLE>
SOUTHERN OHIO COAL COMPANY
STATEMENTS OF RETAINED EARNINGS
BY MONTH, FOR THE QUARTER ENDED DECEMBER 31, 1995
(UNAUDITED)
<CAPTION>
Three
Months
Month Ended Ended
October 31, November 30, December 31, December 31,
1995 1995 1995 1995
(in thousands)
<S> <C> <C> <C> <C>
BALANCE AT BEGINNING OF PERIOD. . $23,199 $24,063 $24,927 $23,199
NET INCOME. . . . . . . . . . . . 864 864 865 2,593
CASH DIVIDENDS DECLARED . . . . . - - 2,593 2,593
BALANCE AT END OF PERIOD. . . . . $24,063 $24,927 $23,199 $23,199
</TABLE>
<PAGE>
<PAGE>
<TABLE>
SOUTHERN OHIO COAL COMPANY
STATEMENTS OF COST OF COMMERCIAL COAL SOLD AND SHIPPED
BY MONTH, FOR THE QUARTER ENDED DECEMBER 31, 1995
<CAPTION>
October November December
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 . . . . . . . . . . . . . . . . . . . . . . $ 6,580 $ 7,238 $ 7,896
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. . . . . . . . . . . . . . . . . . . . . . . $ 2,640 $ 2,904 $ 3,168
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. . . . . . . . . . . . . . . . . . . . . . . $ 2,400 $ 2,640 $ 2,880
J. Total Earnings Allowable:(a)
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.) . . . . . . . . . . . . $ 11,620 $ 12,782 $ 13,944
K. Net Income per Statements of Income - Meigs Division (a). . . $ 864 $ 864 $ 865
Add: Interest Charges - Meigs. . . . . . . . . . . . . . . . 452 452 459
Less: Nonoperating Income (Loss) - Meigs . . . . . . . . . . 9 (812) 125
L. Applied Cost-of-Capital Billing Adder - Meigs Division:
1. Current Month . . . . . . . . . . . . . . . . . . . . . . $ 1,307 $ 2,128 $ 1,199
2. Year-to-Date. . . . . . . . . . . . . . . . . . . . . . . $ 12,814 $ 14,942 $ 16,141
II. Monthly Coal Billing Calculation - Meigs Division:
A. Total Operating Expenses (b). . . . . . . . . . . . . . . . . $ 17,352 $ 18,814 $ 13,349
B. Add: Monthly Cost-of-Capital Billing Adder as Applied
per L. 1. of Section I. . . . . . . . . . . . . . . . . . . 1,307 2,128 1,199
C. Cost Applicable to Current Month Coal Billings (c). . . . . . $ 18,659 $ 20,942 $ 14,548
D. Coal Sold and Shipped in Current Month (in tons)(c) . . . . . 484,062 557,285 477,641
E. Average Price per Ton (in dollars) (C/D)(c) . . . . . . . . . $38.55 $37.58 $30.46
(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" reported in Statements of Income.
(c) Sales were to the Parent Company - Ohio Power Company for the Gavin Plant.
</TABLE>
<PAGE>
<PAGE>
<TABLE>
SOUTHERN OHIO COAL COMPANY
ANALYSIS OF OPERATING RESERVES AND DEFERRED CREDITS
BY MONTH-END, FOR THE QUARTER ENDED DECEMBER 31, 1995
<CAPTION>
October 31, November 30, December 31,
1995 1995 1995
(in thousands)
<S> <C> <C> <C>
Operating Reserves:
Accrued Pensions. . . . . . . . . . . . . . . $ 3,839 $ 3,861 $ 3,882
Accrued Postretirement Benefits
Other Than Pensions . . . . . . . . . . . . 19,772 20,273 20,845
Workers' Compensation . . . . . . . . . . . . 9,302 9,235 9,066
Postemployment Benefits . . . . . . . . . . . 4,649 4,649 4,649
Public Liability Insurance. . . . . . . . . . 177 182 182
Tunnel Settlement . . . . . . . . . . . . . . 300 300 300
Total Operating Reserves. . . . . . . $38,039 $38,500 $38,924
Deferred Credits:
Income Taxes. . . . . . . . . . . . . . . . . $62,465 $61,860 $59,746
Postemployment Benefits . . . . . . . . . . . 1,161 1,150 1,139
Other . . . . . . . . . . . . . . . . . . . . 35 228 100
Total Deferred Credits. . . . . . . . $63,661 $63,238 $60,985
</TABLE>
<PAGE>
<PAGE>
SOUTHERN OHIO COAL COMPANY
INFORMATION CONCERNING CAPITAL IMPROVEMENTS
FOR THE QUARTER ENDED DECEMBER 31, 1995
There were no significant changes with regard to the Company s mining
plant during the quarter.
<PAGE>
<PAGE>
<TABLE>
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 DECEMBER 31, 1995
<CAPTION>
October 31, 1995 November 30, 1995 December 31, 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 $ 7,386 $ - $ 7,386 $ 7,386 $ - $ 7,386
Mining Structures
and Equipment. . . . . . . . 227,549 134,494 93,055 225,197 133,868 91,329 222,737 132,732 90,005
Coal Interests
(net of depletion) . . . . . 4,161 - 4,161 4,124 - 4,124 4,088 - 4,088
Mine Development Costs . . . . 134,149 48,525 85,624 134,149 49,135 85,014 134,149 49,716 84,433
Total Mining Plant in
Service. . . . . . . . . $373,268 $183,019 $190,249 $370,856 $183,003 $187,853 $368,360 $182,448 $185,912
/TABLE
<PAGE>
<PAGE>
SOUTHERN OHIO COAL COMPANY
INFORMATION CONCERNING OPERATIONS
FOR THE QUARTER ENDED DECEMBER 31, 1995
There were no signficant changes with regard to the Company s operations
during the quarter.
<PAGE>
<PAGE>
<TABLE>
SOUTHERN OHIO COAL COMPANY
STATEMENTS OF COST OF OPERATION
BY MONTH, FOR THE QUARTER ENDED DECEMBER 31, 1995
<CAPTION>
Three
Months
October November December Ended
1995 1995 1995 12/31/95
(in thousands)
<S> <C> <C> <C> <C>
Direct Labor-UMW* . . . . . . . . . . . . . . . . $ 424 $ 448 $ 411 $ 1,283
Indirect Labor-UMW* . . . . . . . . . . . . . . . 1,516 1,390 1,322 4,228
Benefits-UMW* . . . . . . . . . . . . . . . . . . 1,865 1,321 1,820 5,006
Salaries and Benefits-Nonunion. . . . . . . . . . 1,481 1,362 1,518 4,361
Operating Supplies. . . . . . . . . . . . . . . . 1,058 1,125 906 3,089
Repair Parts and Materials. . . . . . . . . . . . 1,520 1,052 (385) 2,187
Electricity and Other Utilities . . . . . . . . . 583 629 609 1,821
Outside Services-Maintenance, Haulage
and Reclamation . . . . . . . . . . . . . . . . 956 1,294 1,272 3,522
Taxes Other Than Income Taxes** . . . . . . . . . 775 494 594 1,863
Rental of Equipment . . . . . . . . . . . . . . . 1,370 1,372 1,363 4,105
Depreciation, Depletion and Amortization. . . . . 1,341 1,376 1,329 4,046
Mining Cost Normalization***. . . . . . . . . . . 3,513 3,759 2,547 9,819
Other Production Costs. . . . . . . . . . . . . . 1,424 1,725 1,388 4,537
Subtotal. . . . . . . . . . . . . . . . . . . . . 17,826 17,347 14,694 49,867
Transfers of Production Costs (to)/from
Coal Inventory. . . . . . . . . . . . . . . . . (990) 360 (1,188) (1,818)
Total . . . . . . . . . . . . . . . . . $16,836 $17,707 $13,506 $48,049
* 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>
<PAGE>
<PAGE>
<TABLE>
SOUTHERN OHIO COAL COMPANY
CONSTRUCTION EXPENDITURE BUDGET - 1996
<CAPTION>
Description Budgeted Amount*
(in thousands)
<S> <C>
Preparation Plant Computer System
and Purchase of Mineral Rights $374
Mine Plant and Subsidence Blankets 403
Total $777
* This budget does not include any possible lease transactions.
</TABLE>
