<PAGE>
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 1995
OR
( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from ________ to ________
Commission File Number 1-2385
THE DAYTON POWER AND LIGHT COMPANY
(Exact name of registrant as specified in its charter)
OHIO 31-0258470
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
Courthouse Plaza Southwest
Dayton, Ohio 45402
(Address of principal executive offices)
(513) 224-6000
(Registrant's telephone number, including area code)
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the Securities
Exchange Act of 1934 during the preceding 12 months (or for such
shorter period that the registrant was required to file such reports),
and (2) has been subject to such filing requirements for the past 90
days.
YES X NO
---- ----
The registrant meets the conditions set forth in General Instruction
H(1)(a) and (b) of Form 10-Q and is therefore filing this form with
the reduced disclosure format.
Indicate the number of shares of the issuer's classes of common stock,
as of the latest practicable date.
Common Stock, $.01 par value 41,172,173 Shares
---------------------------- -----------------
(Title of each class) (Outstanding at June 30, 1995)
<PAGE>
THE DAYTON POWER AND LIGHT COMPANY
INDEX
Page No.
Part I - Financial Information
Item 1. Financial Statements
Consolidated Statement of Results of Operations 1
Consolidated Statement of Cash Flows 2
Consolidated Balance Sheet 3
Notes to Consolidated Financial Statements 5
Operating Statistics 7
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of
Operations 9
Part II - Other Information 11
Signatures 12
i
<PAGE>
<TABLE>
<CAPTION>
CONSOLIDATED STATEMENT OF RESULTS OF OPERATIONS
The Dayton Power and Light Company
Three Months Six Months
Ended Ended
June 30 June 30
------------- -------------
1995 1994 1995 1994
---- ---- ---- ----
--thousands-- --thousands--
<S> <C> <C> <C> <C>
Income
------
Utility service revenues--
Electric $234,844 $226,310 $490,919 $476,608
Gas 30,641 30,422 127,828 149,298
Steam 1,063 1,167 3,969 4,714
------- ------- ------- -------
Total utility service revenues 266,548 257,899 622,716 630,620
Interest and other income 3,323 5,762 4,868 7,119
------- ------- ------- -------
Total Income 269,871 263,661 627,584 637,739
------- ------- ------- -------
Expenses
--------
Fuel used in electric and steam
production 59,554 54,749 123,701 113,430
Gas purchased for resale 17,614 17,572 80,633 96,787
Operation and maintenance 55,750 52,096 106,901 112,203
Depreciation and amortization 28,154 27,805 56,213 55,704
General taxes 30,915 28,870 62,096 57,865
Interest expense 23,297 23,307 46,517 46,792
Amortization of regulatory
assets, net 2,794 2,682 5,519 5,312
------- ------- ------- -------
Total Expenses 218,078 207,081 481,580 488,093
------- ------- ------- -------
Income Before Income Taxes 51,793 56,580 146,004 149,646
Income Taxes 18,032 20,741 52,919 57,589
------- ------- ------- -------
Net Income 33,761 35,839 93,085 92,057
Preferred Dividends 217 2,111 434 4,231
------- ------- ------- -------
Earnings on Common Stock $ 33,544 $ 33,728 $ 92,651 $ 87,826
======= ======= ======= =======
</TABLE>
Set Notes to Consolidated Financial Statements.
These interim statements are unaudited.
-1-
<PAGE>
<TABLE>
<CAPTION>
CONSOLIDATED STATEMENT OF CASH FLOWS
The Dayton Power and Light Company
Six Months
Ended
June 30
-------------
1995 1994
---- ----
--thousands--
<S> <C> <C>
Operating Activities
--------------------
Cash received from utility customers $642,794 $651,463
Other operating cash receipts 5,655 7,153
Cash paid for:
Fuel and purchased power (120,023) (120,333)
Purchased gas (74,315) (87,772)
Operation and maintenance labor (44,678) (45,437)
Nonlabor operating expenditures (76,287) (80,838)
Interest (net of amounts
capitalized) (43,125) (46,051)
Income taxes (38,304) (42,910)
Property, excise and payroll taxes (71,362) (65,559)
------- -------
Net cash provided by operating
activities 180,355 169,716
------- -------
Investing Activities
--------------------
Net cash used for property
expenditures and other (42,708) (32,232)
------- -------
Financing Activities
--------------------
Dividends paid on common and
preferred stock (66,733) (54,365)
Retirement of short-term debt - (25,000)
Retirement of long-term debt (3,145) (3,137)
Retirement of preferred stock - (94,249)
Capital contribution - 63,184
------- -------
Net cash used for financing
activities (69,878) (113,567)
------- -------
Net increase in cash and temporary
cash investments 67,769 23,917
Cash and temporary cash investments
at beginning of period 8,297 5,980
------- -------
Cash and temporary cash investments
at end of period $ 76,066 $ 29,897
======= =======
</TABLE>
See Notes to Consolidated Financial Statements.
These interim statements are unaudited.
-2-
<PAGE>
<TABLE>
<CAPTION>
CONSOLIDATED BALANCE SHEET
The Dayton Power and Light Company
At At
June 30, Dec. 31,
1995 1994
-------- --------
--thousands--
<S> <C> <C>
ASSETS
------
Property and Plant
------------------
Electric property and plant $3,013,482 $2,961,563
Gas property and plant 257,017 251,751
Steam and other property and plant 38,545 38,571
Construction work in progress 41,490 68,549
--------- ---------
3,350,534 3,320,434
Less--
Accumulated depreciation and
amortization (1,088,108) (1,043,779)
--------- ---------
Net property and plant 2,262,426 2,276,655
--------- ---------
Current Assets
--------------
Cash and temporary cash investments 76,066 8,297
Accounts receivable, less provision
for uncollectible accounts 73,726 99,785
Inventories, at average cost 71,823 83,345
Taxes applicable to subsequent years 74,903 78,289
Prepayments and other 9,217 29,555
--------- ---------
Total current assets 305,735 299,271
--------- ---------
Other Assets
------------
Income taxes recoverable through
future revenues 243,661 249,330
Regulatory assets (Note 1) 165,216 168,844
Other assets 171,715 152,950
--------- ---------
Total other assets 580,592 571,124
--------- ---------
Total Assets $3,148,753 $3,147,050
========= =========
</TABLE>
See Notes to Consolidated Financial Statements.
These interim statements are unaudited.
-3-
<PAGE>
<TABLE>
<CAPTION>
CONSOLIDATED BALANCE SHEET
(continued)
The Dayton Power and Light Company
At At
June 30, Dec.31,
1995 1994
-------- -------
--thousands--
<S> <C> <C>
CAPITALIZATION AND LIABILITIES
------------------------------
Capitalization
--------------
Common shareholder's equity--
Common stock $ 412 $ 412
Other paid-in capital 738,587 738,494
Earnings reinvested in the business 416,122 421,410
--------- ---------
Total common shareholder's equity 1,155,121 1,160,316
Preferred stock--
Without mandatory redemption
provisions 22,851 22,851
Long-term debt 1,001,903 1,003,736
--------- ---------
Total capitalization 2,179,875 2,186,903
--------- ---------
Current Liabilities
-------------------
Accounts payable 50,508 75,650
Current portion of first mortgage bonds 3,450 4,730
Accrued taxes 105,943 123,491
Accrued interest 20,486 20,713
Gas costs refundable 29,506 5,635
Dividends payable 33,150 -
Other 13,425 26,055
--------- ---------
Total current liabilities 256,468 256,274
--------- ---------
Deferred Credits and Other
--------------------------
Deferred taxes 534,188 530,630
Unamortized investment tax credit 80,944 81,212
Other 97,278 92,031
--------- ---------
Total deferred credits and other 712,410 703,873
--------- ---------
Total Capitalization and Liabilities $3,148,753 $3,147,050
========= =========
</TABLE>
See Notes to Consolidated Financial Statements.
These interim statements are unaudited.
-4-
<PAGE>
Notes to Consolidated Financial Statements
1. Regulatory assets on the balance sheet consist of:
<TABLE>
<CAPTION>
June 30, Dec. 31,
1995 1994
-------- --------
--millions--
<S> <C> <C>
Phase-in $ 70.8 $ 75.9
Demand-Side Management 34.9 31.9
Deferred interest - Zimmer 59.5 61.0
------ ------
Total $165.2 $168.8
====== ======
</TABLE>
2. Statement of Cash Flow Reconciliation of Net Income to Net Cash
Provided by Operating Activities:
<TABLE>
<CAPTION>
Six Months Ended
June 30
1995 1994
---- ----
--millions--
<S> <C> <C>
Net Income $ 93.1 $ 92.1
Adjustments for non-cash items:
Depreciation and amortization 56.2 55.7
Deferred income taxes 2.1 (4.0)
Taxes applicable to subsequent years 57.2 53.4
Amortization of regulatory assets, net 5.5 5.3
Changes in Working Capital:
Accounts receivable and unbilled
revenue 26.1 36.2
Accounts payable (22.7) (35.5)
Other (22.5) (17.9)
Other operating activities (14.6) (15.6)
------ ------
Net cash provided by operating
activities $180.4 $169.7
====== ======
</TABLE>
3. Reclassifications have been made in certain prior years' amounts
to conform to the current reporting presentation of the Company.
-5-
<PAGE>
4. The consolidated financial statements in this report have been
prepared by the Company, without audit, pursuant to the rules and
regulations of the Securities and Exchange Commission. Certain
information and footnote disclosures normally included in financial
statements prepared in accordance with generally accepted accounting
principles have been condensed or omitted pursuant to such rules and
regulations. These consolidated financial statements should be read
in conjunction with the consolidated financial statements and notes
thereto in the Company's 1994 Annual Report on Form 10-K.
The information included in this Form 10-Q reflects all
adjustments which are, in the opinion of management, necessary for a
fair statement of the results of operations for the periods presented.
Any adjustments are of a normal recurring nature.
-6-
<PAGE>
<TABLE>
<CAPTION>
OPERATING STATISTICS
The Dayton Power and Light Company
Three Months Six Months
Ended Ended
June 30 June 30
------------- -------------
1995 1994 1995 1994
---- ---- ---- ----
<S> <C> <C> <C> <C>
Electric
--------
Sales (millions of kWh)--
Residential 924 970 2,271 2,396
Commercial 769 727 1,541 1,476
Industrial 1,168 1,102 2,264 2,141
Other 1,028 617 2,048 1,161
------- ------- ------- -------
Total 3,889 3,416 8,124 7,174
Revenues (thousands of dollars)--
Residential 84,672 87,202 194,981 202,777
Commercial 54,930 53,232 108,767 106,237
Industrial 59,530 57,461 115,575 112,631
Other 35,712 28,415 71,596 54,963
------- ------- ------- -------
Total 234,844 226,310 490,919 476,608
Other Electric Statistics--
Average price per kWh--
retail and wholesale
customers (cents) 5.97 6.56 5.98 6.58
Fuel cost per net kWh
generated (cents) 1.31 1.39 1.33 1.43
Electric customers at
end of period 472,394 466,716 472,394 466,716
Average kWh use per
residential customer 2,188 2,322 5,381 5,739
Peak demand-maximum one hour
use (mw), (net) 2,704 2,824 2,704 2,824
</TABLE>
-7-
<PAGE>
<TABLE>
<CAPTION>
OPERATING STATISTICS
(continued)
The Dayton Power and Light Company
Three Months Six Months
Ended Ended
June 30 June 30
------------- -------------
1995 1994 1995 1994
---- ---- ---- ----
<S> <C> <C> <C> <C>
Gas
---
Sales (millions of mcf)--
Residential 3,617 3,497 16,388 18,250
Commercial 999 952 4,544 5,236
Industrial 423 341 1,648 2,235
Other 546 371 1,742 1,786
Transportation gas delivered 3,521 3,285 8,974 8,462
------- ------- ------- -------
Total 9,106 8,446 33,296 35,969
Revenues (thousands of dollars)--
Residential 19,833 20,138 85,305 99,142
Commercial 4,930 4,958 22,274 26,863
Industrial 1,692 1,801 7,531 10,598
Other 4,186 3,525 12,718 12,695
------- ------- ------- -------
Total 30,641 30,422 127,828 149,298
Other Gas Statistics--
Average price mcf-retail
customers (dollars) 5.10 5.55 5.05 5.28
Gas customers at end of period 291,326 287,271 291,326 287,271
Degree Days
(based on calendar month)--
Heating 607 600 3,438 3,794
Cooling 249 350 249 350
</TABLE>
-8-
<PAGE>
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations
The second quarter of 1995 earnings on common stock were slightly
less than last year. The six month earnings on common stock increased
by $4.8 million over 1994. The economy of West Central Ohio remained
strong in the second quarter, outperforming most areas of the country,
with energy sales to business customers increasing 5% over year-to-
date 1994 results. This performance, combined with cost containment
efforts and high productivity levels from employees across the
Company, helped to offset the effects of milder weather in the first
half of 1995.
An analysis of the financial condition and results of operation
for the second quarter and six months ended June 30, 1995 and 1994 is
discussed below.
Financial Condition
-------------------
Construction plans are subject to continuing review and are
expected to be revised in light of changes in financial and economic
conditions, load forecasts, legislative and regulatory developments
and changing environmental standards, among other factors. The
Company's ability to complete its capital projects and the reliability
of future service will be affected by its financial condition, the
availability of external funds at reasonable cost and adequate and
timely rate increases.
As of June 30, 1995, the Company's cash and temporary cash
investment balance was $76.1 million.
The Company has available to it $97 million in short-term
informal lines of credit. As of June 30, 1995, the Company had no
short-term debt outstanding. DPL Inc. and its subsidiaries have
$200 million available through a Revolving Credit Agreement. As of
June 30, 1995, DPL Inc. had no outstanding borrowings under this
Credit Agreement. The Company has authority from the PUCO to issue
short term debt up to $200 million with a maximum debt limit of
$300 million including loans from DPL Inc. under the terms of the
Credit Agreement.
The Company anticipates that it has sufficient capacity to issue
First Mortgage Bonds to satisfy its requirements in connection with
the financing of its construction and refinancing programs during the
five year period 1995-1999.
-9-
<PAGE>
Results of Operations
---------------------
Electric revenues increased by $8.5 million and $14.3 million,
respectively, for the second quarter and six months ended June 30,
1995, over the corresponding periods in 1994. Increased sales to
other public utilities is the primary reason for the revenue
increases. Sales to business customers increased 5% year-to-date over
last year reflecting the continued strength of the West Central Ohio
economy. Offsetting these sales gains is a 5% decline in residential
sales from milder June weather than last year.
Fuel used in electric and steam production increased $4.8 million
and $10.3 million, respectively, over the second quarter and year-to-
date 1994, primarily related to increased electric sales.
Gas revenues and gas purchased for resale decreased $21.5 million
and $16.2 million, respectively, from year-to-date last year. The
decrease reflects a decline of 7% in gas sales due primarily to mild
winter temperatures and lower gas cost recovery rates.
Interest and other income decreased $2.4 million for the quarter
from last year due to interest on a tax refund in 1994.
Operation and maintenance expense increased $3.7 million over the
corresponding quarter from last year due to higher administrative
expenses. Operation and maintenance expense decreased $5.3 million
year-to-date from last year. The decrease reflects production station
outages occurring in 1994 and decreased benefits and claims costs.
General taxes increased $2.0 million and $4.2 million,
respectively, for the second quarter and six months ended June 30,
1995. Increased property tax due to higher rates and property base
and greater utility excise tax due to higher gross receipts caused the
increase.
Preferred stock dividends decreased $1.9 million during the
second quarter and $3.8 million year-to-date from the same periods
last year due to redemptions of several series of preferred stock in
1994.
-10-
<PAGE>
Part II. Other Information
---------------------------
Item 5. Other Information.
Rate Regulations and Government Legislation
-------------------------------------------
Ronda H. Fergus was appointed to serve as a Public Utilities
Commission of Ohio ("PUCO") commissioner for a five-year term, which
commenced April 11, 1995. Commissioner Fergus was previously chief of
the telecommunications section of the Utilities Department at the
PUCO.
On May 31, 1995 and June 1, 1995, respectively, the Company filed
its electric and natural gas Long-Term Forecast Reports ("LTFR") with
the PUCO. An Integrated Resource Plan filed as part of the electric
LTFR included plans for the construction of a series of 75 MW
combustion turbine generating units. The first unit became
operational on June 1, 1995.
In 1994 and 1995, all 12 municipal customers of the Company
signed new 20-year service agreements with the Company for continued
transmission service and partial power service requirements. The last
of the service agreements received approval from FERC on June 29,
1995.
Environmental Considerations
----------------------------
Air Quality
-----------
As required by State of Ohio regulation, in April 1995, the PUCO
initiated proceedings to conduct a review of the Company's
Environmental Compliance Plan ("ECP"). The Company submitted the ECP
update report and data to the PUCO on July 14, 1995. A hearing will
be scheduled at a future date to review the status of the ECP.
Item 6. Exhibits and Reports on Form 8-K.
(b) Reports on Form 8-K
-------------------
No reports on Form 8-K were filed by the Company during the
quarter ended June 30, 1995.
-11-
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf
by the undersigned thereunto duly authorized.
THE DAYTON POWER AND LIGHT COMPANY
----------------------------------
(Registrant)
Date August 10, 1995 /s/ Paul R. Anderson
--------------- ------------------------------
Controller
(Principal Accounting Officer)
Date August 10, 1995 /s/ Thomas M. Jenkins
--------------- ------------------------------
Group Vice President
(Principal Financial Officer)
-12-
<TABLE> <S> <C>
<ARTICLE> UT
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> JUN-30-1995
<BOOK-VALUE> PER-BOOK
<TOTAL-NET-UTILITY-PLANT> 2262426
<OTHER-PROPERTY-AND-INVEST> 0
<TOTAL-CURRENT-ASSETS> 305735
<TOTAL-DEFERRED-CHARGES> 408877
<OTHER-ASSETS> 171715
<TOTAL-ASSETS> 3148753
<COMMON> 412
<CAPITAL-SURPLUS-PAID-IN> 738587
<RETAINED-EARNINGS> 416122
<TOTAL-COMMON-STOCKHOLDERS-EQ> 1155121
0
22851
<LONG-TERM-DEBT-NET> 1001903
<SHORT-TERM-NOTES> 0
<LONG-TERM-NOTES-PAYABLE> 0
<COMMERCIAL-PAPER-OBLIGATIONS> 0
<LONG-TERM-DEBT-CURRENT-PORT> 3450
0
<CAPITAL-LEASE-OBLIGATIONS> 0
<LEASES-CURRENT> 0
<OTHER-ITEMS-CAPITAL-AND-LIAB> 965428
<TOT-CAPITALIZATION-AND-LIAB> 3148753
<GROSS-OPERATING-REVENUE> 266548
<INCOME-TAX-EXPENSE> 18032
<OTHER-OPERATING-EXPENSES> 194781
<TOTAL-OPERATING-EXPENSES> 212813
<OPERATING-INCOME-LOSS> 53735
<OTHER-INCOME-NET> 3323
<INCOME-BEFORE-INTEREST-EXPEN> 57058
<TOTAL-INTEREST-EXPENSE> 23297
<NET-INCOME> 33761
217
<EARNINGS-AVAILABLE-FOR-COMM> 33544
<COMMON-STOCK-DIVIDENDS> 33146
<TOTAL-INTEREST-ON-BONDS> 20031
<CASH-FLOW-OPERATIONS> 55156
<EPS-PRIMARY> 0.81
<EPS-DILUTED> 0.81
</TABLE>
