<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 March 31, 1996
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 March 31, 1996)
<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 6
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of
Operations 8
Part II - Other Information 10
Signatures 11
i
<PAGE>
CONSOLIDATED STATEMENT OF RESULTS OF OPERATIONS
The Dayton Power and Light Company
Three Months Ended
March 31
------------------
1996 1995
---- ----
--thousands--
Income
- ------
Utility service revenues --
Electric $264,625 $256,075
Gas and other 104,379 100,093
-------- --------
Total utility service revenues 369,004 356,168
Interest and other income 1,828 1,545
-------- --------
Total Income 370,832 357,713
-------- --------
Expenses
- --------
Fuel and purchased power 61,624 64,147
Gas purchased for resale 64,559 63,019
Operation and maintenance 55,657 51,150
Depreciation and amortization 29,230 28,059
Amortization of regulatory assets, net 4,059 2,725
General taxes 32,156 31,181
Interest expense 22,043 23,221
-------- --------
Total Expenses 269,328 263,502
-------- --------
Income Before Income Taxes 101,504 94,211
Income Taxes 38,753 34,887
-------- --------
Net Income 62,751 59,324
Preferred Dividends 217 217
-------- --------
Earnings on Common Stock $ 62,534 $ 59,107
======== ========
See Notes to Consolidated Financial Statements.
These interim statements are unaudited.
<PAGE>
-1-
CONSOLIDATED STATEMENT OF CASH FLOWS
The Dayton Power and Light Company
Three Months Ended
March 31
------------------
1996 1995
---- ----
--thousands--
Operating Activities
- --------------------
Cash received from utility customers $349,294 $344,238
Other operating cash receipts 1,689 2,509
Cash received (paid) for:
Fuel and purchased power (56,219) (61,472)
Purchased gas (49,260) (33,621)
Operation and maintenance labor (25,821) (25,103)
Nonlabor operating expenditures (41,017) (40,770)
Interest (26,107) (23,094)
Income taxes 11,833 12,028
Property, excise and payroll taxes (50,152) (49,516)
-------- --------
Net cash provided by operating activities 114,240 125,199
-------- --------
Investing Activities
- --------------------
Net cash used for property expenditures
and other (46,314) (22,708)
-------- --------
Financing Activities
- --------------------
Dividends paid on common and preferred stock (34,917) (33,153)
Retirement of short-term debt (3,500) -
Retirement of long-term debt - (42)
-------- --------
Net cash used for financing activities (38,417) (33,195)
-------- --------
Cash and temporary cash investments--
Net change 29,509 69,296
Balance at beginning of period 39,110 8,297
-------- --------
Balance at end of period $ 68,619 $ 77,593
======== ========
See Notes to Consolidated Financial Statements.
These interim statements are unaudited.
-2-
<PAGE>
CONSOLIDATED BALANCE SHEET
The Dayton Power and Light Company
At At
March 31, December 31,
1996 1995
-------- -----------
--thousands--
ASSETS
- ------
Property
- --------
Electric property $3,062,415 $3,064,579
Gas and other utility property 290,146 289,286
Construction work in progress 38,980 22,926
---------- ----------
3,391,541 3,376,791
Less--
Accumulated depreciation and amortization (1,159,961) (1,134,632)
---------- ----------
Net property 2,231,580 2,242,159
---------- ----------
Current Assets
- --------------
Cash and temporary cash investments 68,619 39,110
Accounts receivable, less provision for
uncollectible accounts 157,109 144,510
Inventories, at average cost 57,873 81,628
Taxes applicable to subsequent years 52,890 82,371
Prepaid utility excise tax 36,079 18,069
Prepayments and other 15,408 27,683
---------- ----------
Total current assets 387,978 393,371
---------- ----------
Other Assets
- ------------
Income taxes recoverable through future
revenues 235,934 238,632
Regulatory assets 151,580 155,715
Other assets 196,201 174,423
---------- ----------
Total other assets 583,715 568,770
---------- ----------
Total Assets $3,203,273 $3,204,300
========== ==========
See Notes to Consolidated Financial Statements.
These interim statements are unaudited.
-3-
<PAGE>
CONSOLIDATED BALANCE SHEET
(continued)
The Dayton Power and Light Company
At At
March 31, December 31,
1996 1995
-------- -----------
--thousands--
CAPITALIZATION AND LIABILITIES
- ------------------------------
Capitalization
- --------------
Common shareholder's equity--
Common stock $ 412 $ 412
Other paid-in capital 738,739 738,693
Earnings reinvested in the business 478,216 451,350
---------- ----------
Total common shareholder's equity 1,217,367 1,190,455
Preferred stock 22,851 22,851
Long-term debt 991,612 991,591
---------- ----------
Total capitalization 2,231,830 2,204,897
---------- ----------
Current Liabilities
- -------------------
Accounts payable 76,384 96,958
Accrued taxes 134,383 115,886
Accrued interest 17,258 21,680
Other 29,556 47,717
---------- ----------
Total current liabilities 257,581 282,241
---------- ----------
Deferred Credits and Other
- --------------------------
Deferred taxes 529,051 532,144
Unamortized investment tax credit 78,681 79,424
Other 106,130 105,594
---------- ----------
Total deferred credits and other 713,862 717,162
---------- ----------
Total Capitalization and Liabilities $3,203,273 $3,204,300
========== ==========
See Notes to Consolidated Financial Statements.
These interim statements are unaudited.
-4-
<PAGE>
Notes to Consolidated Financial Statements
1. Reconciliation of Net Income to Net Cash Provided by Operating
Activities:
Three Months Ended
March 31
1996 1995
---- ----
--millions--
Net Income $62.8 $59.3
Adjustments for non-cash items:
Depreciation and amortization 29.2 28.1
Taxes applicable to subsequent years 29.6 28.6
Changes in Working Capital:
Accounts receivable (12.6) (11.7)
Accounts payable (15.1) 6.0
Other 14.0 14.1
Other operating activities 6.3 0.8
------ ------
Net cash provided by operating
activities $114.2 $125.2
====== ======
2. Reclassifications have been made in certain prior years' amounts
to conform to the current reporting presentation of the Company.
3. 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 1995 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.
-5-
<PAGE>
OPERATING STATISTICS
The Dayton Power and Light Company
Three Months Ended
March 31
------------------
1996 1995
---- ----
Electric
- --------
Sales (millions of kWh) --
Residential 1,498 1,346
Commercial* 832 772
Industrial* 1,063 1,096
Other 946 1,020
------- -------
Total 4,339 4,234
Revenues (thousands of dollars) --
Residential 119,350 110,309
Commercial* 56,813 53,837
Industrial* 53,428 56,045
Other 35,034 35,885
------- -------
Total 264,625 256,076
Other Electric Statistics --
Average price per kWh--retail and wholesale
customers (cents) 6.03 5.99
Fuel cost per net kWh generated (cents) 1.30 1.34
Electric customers at end of period 476,557 471,596
Average kWh use per residential customer 3,518 3,194
Peak demand--maximum one hour use (mw), (net) 2,668 2,508
*Includes the effect of reclassifying certain industrial customers as
commercial customers in the fourth quarter of 1995.
-6-
<PAGE>
OPERATING STATISTICS
(continued)
The Dayton Power and Light Company
Three Months Ended
March 31
------------------
1996 1995
---- ----
Gas
- ---
Sales (millions of mcf) --
Residential 14,712 12,771
Commercial 4,447 3,545
Industrial 1,846 1,225
Other 1,308 1,196
Transported gas 5,651 5,453
------- -------
Total 27,964 24,190
Revenues (thousands of dollars) --
Residential 66,910 65,472
Commercial 19,128 17,344
Industrial 7,259 5,839
Other 9,218 8,532
------- -------
Total 102,515 97,187
Other Gas Statistics --
Average price per mcf--retail customers
(dollars) 4.42 5.03
Gas customers at end of period 295,778 291,315
Degree Days (based on calendar month) --
Heating 3,197 2,831
Cooling 0 0
-7-
<PAGE>
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations
The Company's earnings for the first quarter of 1996 increased
$3.4 million compared to the same period a year ago. Continued strong
business activity and colder than normal winter weather were the main
reasons behind the improved financial performance. The Company was
also able to continue to control costs, which helped to achieve the
earnings growth.
An analysis of the financial condition and results of operations
for the first quarter ended March 31, 1996 and 1995 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 March 31, 1996, the Company's cash and temporary cash
investment balance was $68.6 million.
The Company has available to it $97 million in short-term
informal lines of credit. As of March 31, 1996, the Company had no
short-term debt outstanding. DPL Inc. and its subsidiaries have
$200 million available through a Revolving Credit Agreement. As of
March 31, 1996, DPL Inc. had no outstanding borrowings under this
Credit Agreement. The Company has authority from the Public Utilities
Commission of Ohio ("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 1996-2000.
-8-
<PAGE>
Results of Operations
- ---------------------
Electric revenues increased by $8.6 million for the first quarter
of 1996. Residential customer revenues were up $9.0 million as a
result of higher sales from colder weather.
Gas revenues increased $5.3 million from the corresponding
quarter last year. The variance reflects a 16% increase in gas sales
due to colder weather and to increased business activity.
Fuel and purchased power declined $2.5 million in the first
quarter primarily due to lower electric fuel costs. Operation and
maintenance expense was $4.5 million higher in the first quarter of
1996 compared to 1995. The variance was due to increased insurance
costs.
Income taxes increased $3.9 million from the first quarter of
1995 primarily due to higher book income.
-9-
<PAGE>
Part II. Other Information
---------------------------
Item 5. Other Information.
Rate Regulation and Government Legislation
- ------------------------------------------
On April 24, 1996, the Federal Energy Regulatory Commission
("FERC") issued final rules requiring all electric utilities that own
or control transmission facilities to file open-access transmission
service tariffs, which tariffs would provide third parties with non-
discriminatory wholesale transmission service comparable to what the
utility provides itself. The rules require all such filings within
60 days of the publication of the orders in the Federal Register. The
Company filed its open-access tariff on April 12, 1996. FERC further
stated that all stranded costs reasonably incurred and costs of
complying with the rules will be recoverable by electric utilities.
On March 21, 1996, legislation was introduced in the Ohio House
of Representatives which would restructure the electric industry in
Ohio. It is not expected that this legislation will be passed during
this legislative session.
On January 25, 1996, Governor Voinovich reappointed Chairman
Craig A. Glazer to the PUCO for a five year term which commenced on
April 11, 1996 and will extend until April 10, 2001.
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 DPL Inc. during the
quarter ended March 31, 1996.
-10-
<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 May 13, 1996 /s/ Paul R. Anderson
------------------------ ------------------------------
Paul R. Anderson
Controller
(Principal Accounting Officer)
Date May 13, 1996 /s/ Thomas M. Jenkins
------------------------- ------------------------------
Thomas M. Jenkins
Group Vice President
(Principal Financial Officer)
-11-
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