File No. 69-244
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UNITED STATES
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
CONNECTICUT ENERGY CORPORATION
------------------------------
(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(a) The name, state of organization, location and nature of business
of the claimant and every subsidiary thereof, other than any exempt wholesale
generator ("EWG") or foreign utility company in which the claimant directly
or indirectly holds an interest are as follows:
The name of the claimant is Connecticut Energy Corporation (the
"claimant"). The claimant is incorporated under the laws of the state of
Connecticut. Its principal place of business and executive offices are
located at 855 Main Street, Bridgeport, Connecticut 06604. The claimant is not
an operating company. The business of the claimant consists of investing in,
disposing of, buying, selling and otherwise dealing in the stock, bonds,
securities and properties of the other corporations listed below in 1(b).
1(b) The name, state of organization, location and nature of business
of every subsidiary of the claimant thereof, other than any EWG or foreign
utility company in which the claimant directly or indirectly holds an
interest are as follows:
(i) The Southern Connecticut Gas Company ("Southern"). Southern
is incorporated under the laws of the state of Connecticut
and has its executive offices located at 855 Main Street,
Bridgeport, Connecticut 06604. Southern is principally
engaged in the retail distribution and sale of natural gas
for domestic, commercial and industrial uses in southern
Connecticut, primarily in the New Haven and Bridgeport areas.
Incidental to the sale of gas, Southern sells gas water
heaters and space heaters. Southern is subject to the
jurisdiction of the Connecticut Department of Public Utility
Control as to accounting, rates, charges, certain operating
matters and the issuance of securities other than borrowings
maturing in twelve months or less.
(ii) CNE Development Corporation ("CNE Development"). CNE
Development is incorporated under the laws of the state of
Connecticut and has its executive offices located at
855 Main Street, Bridgeport, Connecticut 06604. CNE
Development is a nonutility subsidiary that was formed in
December 1994 and is an equity holder in an entity formed
to purchase and market natural gas. CNE Development also
brokers the sale of energy products, principally natural gas.
(iii) CNE Energy Services Group, Inc. ("CNE Energy"). CNE Energy is
incorporated under the laws of the state of Connecticut and
has its executive offices located at 855 Main Street,
Bridgeport, Connecticut 06604. CNE Energy was formed in
August 1995 and engages in nonregulated activities relating
to the selling, planning, purchasing and management of
various energy services to commercial and industrial end
users.
(iv) CNE Venture-Tech, Inc. ("CNE Venture-Tech") is incorporated
under the laws of the state of Connecticut and has its
executive offices located at 855 Main Street, Bridgeport,
Connecticut 06604. CNE Venture-Tech is a nonutility
subsidiary that was formed in October 1996. CNE Venture-Tech
focuses on investing in technology companies and participating
in ventures with technology partners serving the utility
industry.
2. A brief description of the properties of the claimant and its
subsidiary public utility company is as follows:
(a) The claimant -- The claimant has no properties other than the
common stock of the subsidiaries described above in 1(b).
(b) Southern -- A major portion of Southern's physical assets
consists of gas distribution facilities. As of
December 31, 1998, Southern had 2,162 miles of main and
124,053 service connections. Southern leases its corporate
headquarters building in Bridgeport and leases an operating
facility in Orange. It also owns a propane air facility in
Trumbull and certain properties in Bridgeport and New Haven
that were formerly utilized as operating facilities.
Southern subleases a liquefied natural gas plant in Milford
to its nonutility affiliate, CNE Energy, who, in turn,
subleases the plant to a joint venture, Total Peaking
Services, LLC, of which CNE Energy is a 51% member. All of
such assets of Southern are located in the state of
Connecticut. Substantially all of Southern's utility
properties and plant are subject to the lien of the
indenture and supplemental indentures securing its first
mortgage bonds. Southern has no producing field, gas
manufacturing plants or pipelines which receive gas at the
Connecticut border.
3. During the last calendar year and to date, only Southern has been
an operating public utility company, and the following information, therefore,
relates to it alone:
(a) During the calendar year 1998, Southern sold 23,898,399 Mcf
of natural or manufactured gas at retail, earning revenues
of $205,664,492. All of said sales were made in the state of
Connecticut.
(b) None
(c) During the calendar year 1998, Southern made the following
sales of natural or manufactured gas outside Connecticut or
at the Connecticut border:
State Revenues Mcf
----- -------- ---
Delaware $ 15,930 5,825
Louisiana 860,957 418,700
Massachusetts 1,397,857 448,085
Mississippi 2,008,128 911,786
New Hampshire 155,779 52,833
New Jersey 1,060,253 498,888
New York 278,656 120,574
Pennsylvania 166,921 65,962
Rhode Island 78,521 27,106
Texas 500,464 217,246
---------- ---------
$6,523,466 2,767,005
(d) Southern accepts in Connecticut offers to sell gas for
delivery in Connecticut. The total amount of purchases in
calendar year 1998 from out-of-state marketers was 25,073,034
Mcf. The commodity cost of said purchases was $45,169,621.
4. The following information for the reporting period with respect to
the claimant and each interest it holds directly or indirectly in an EWG or
foreign utility company, stating monetary amounts in United States dollars:
(a) None
(b) None
(c) None
(d) None
(e) None
EXHIBIT A
Attached as Exhibit A is a consolidating statement of income and
surplus of the claimant and its subsidiary companies for calendar year 1998,
together with a consolidating balance sheet of the claimant and its
subsidiary companies as of the close of such calendar year.
EXHIBIT B
Financial Data Schedule
Submitted only in electronic format to the Securities and Exchange
Commission.
EXHIBIT C
An organizational chart showing the relationship of each EWG or
foreign utility company to associate companies in the holding-company system.
Not applicable.
The above-named claimant has caused this statement to be duly
executed on its behalf by its authorized officer on this 23rd day of
February, 1999.
CONNECTICUT ENERGY CORPORATION
------------------------------
(Name of Claimant)
By /s/ Carol A. Forest
-----------------------------------------
Carol A. Forest, Vice President, Finance,
Chief Financial Officer, Treasurer
and Assistant Secretary
(Corporate Seal)
Attest:
/s/ Samuel W. Bowlby
- -----------------------------------------
Samuel W. Bowlby, Vice President, General
Counsel and Secretary
Name, title and address of officer to whom notices and correspondence
concerning this statement should be addressed:
Carol A. Forest, Vice President, Finance, Chief Financial Officer, Treasurer
and Assistant Secretary
- ----------------------------------------------------------------------------
(Name) (Title)
Connecticut Energy Corporation, 855 Main Street, Bridgeport, Connecticut 06604
- ------------------------------------------------------------------------------
(Address)
<TABLE>
CONSOLIDATING INCOME STATEMENT
DECEMBER 31, 1998
(UNAUDITED)
<CAPTION>
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EXHIBIT A
THE CNE
SOUTHERN CNE CNE ENERGY ADJUSTMENTS/
CONNECTICUT VENTURE-TECH, DEVELOPMENT SERVICES CEC ELIMINATIONS TOTAL
ACCOUNT DESCRIPTION GAS COMPANY INC. CORPORATION GROUP, INC. HOLDING DEBIT CREDIT CEC
___________________________________________________________________________________________________________________________________
OPERATING REVENUES $225,933,577 $ 66,997 $ 92,966 $1,650,387 $226,994 $227,516,933
PURCHASED GAS 105,879,070 105,879,070
___________________________________________________________________________________________________________________________________
GROSS MARGIN 120,054,507 66,997 92,966 1,650,387 226,994 121,637,863
OPERATING EXPENSES
OPERATIONS 49,058,112 266,971 120,725 5,484 $1,902,379 $228,644 51,125,027
MAINTENANCE 3,639,013 3,639,013
DEPRECIATION/AMORTIZATION 16,911,390 14,536 475 288,232 17,214,633
TAXES OTHER THAN INCOME 14,391,166 6,267 3,211 63,141 11,350 14,452,435
STATE TAXES - CURRENT 1,059,195 7,254 15,485 394,514 20,000 1,496,448
STATE TAXES - DEFERRED 48,000 48,000
FEDERAL INCOME TAXES - CURRENT 2,514,476 (43,245) 40,503 1,077,557 (360,136) 3,229,155
FEDERAL INCOME TAXES - DEFERRED 829,818 160,500 (307,503) 682,815
___________________________________________________________________________________________________________________________________
TOTAL OPERATING EXPENSES 88,403,170 251,783 180,399 2,037,428 1,254,740 239,994 91,887,526
OPERATING INCOME 31,651,337 (184,786) (87,433) (387,041) (1,254,740) 226,994 239,994 29,750,337
ALLOWANCE FOR FUNDS DURING
CONSTRUCTION/EQUITY EARNINGS 109,876 (166,728) 138,852 238,000 320,000
OTHER INCOME, NET (726,496) 268,205 33,333 2,812,697 188,216 312,067 126,673 2,390,561
LEASED LAND INCOME 126,673 126,673 0
___________________________________________________________________________________________________________________________________
TOTAL INCOME 31,161,390 (83,309) 84,752 2,663,656 (1,066,524) 665,734 366,667 32,460,898
INCOME DEDUCTIONS
INTEREST ON LONG-TERM DEBT &
AMORTIZATION 12,027,376 352,597 12,379,973
OTHER INTEREST, NET 1,175,734 5,353 3,897 312,067 872,917
MISCELLANEOUS INCOME DEDUCTIONS 268,974 268,974
___________________________________________________________________________________________________________________________________
TOTAL INCOME DEDUCTIONS 13,472,084 357,950 3,897 312,067 13,521,864
NET INCOME TO COMMON $17,689,306 $(83,309) $84,752 $2,305,706 $(1,070,421) $665,734 $678,734 $18,939,034
=========== ======== ======= ========== =========== ======== ======== ===========
</TABLE>
<TABLE>
CONNECTICUT ENERGY CORPORATION
CONSOLIDATING BALANCE SHEET
DECEMBER 31, 1998
(UNAUDITED)
<CAPTION>
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EXHIBIT A
THE CNE
SOUTHERN CNE CNE ENERGY ADJUSTMENTS/
CONNECTICUT VENTURE-TECH, DEVELOPMENT SERVICES CEC ELIMINATIONS TOTAL
ACCOUNT DESCRIPTION GAS COMPANY INC. CORPORATION GROUP, INC. HOLDING DEBIT CREDIT CEC
________________________________________________________________________________________________________________________________
ASSETS
UTILITY PLANT
INTANGIBLES $ 140,692 $ 140,692
PRODUCTION 2,274,086 2,274,086
STORAGE 3,000,081 3,000,081
DISTRIBUTION 372,319,510 372,319,510
GENERAL 28,423,895 28,423,895
________________________________________________________________________________________________________________________________
SUBTOTAL 406,158,264 406,158,264
CONSTRUCTION WORK IN
PROGRESS 6,993,420 6,993,420
NONUTILITY PROPERTY 5,752,335 $1,504,496 $4,070 $118,376 7,379,277
________________________________________________________________________________________________________________________________
TOTAL PP&E 418,904,019 1,504,496 4,070 118,376 420,530,961
LESS: ACCUMULATED
DEPRECIATION 139,611,366 3,809 475 56,952 139,672,602
________________________________________________________________________________________________________________________________
NET PP&E 279,292,653 1,500,687 3,595 61,424 280,858,359
CURRENT ASSETS
CASH 337,791 741,616 104,233 4,502,148 $2,414,667 8,100,455
ACCOUNTS RECEIVABLE:
TRADE 37,190,887 474,599 37,665,486
OTHER 3,997,706 42,155 30,621 282,287 37,861 4,390,630
INTERCOMPANY 998,358 10,549 16,002 13,009 964,662 $ 2,002,580 0
________________________________________________________________________________________________________________________________
SUBTOTAL 42,186,951 52,704 46,623 769,895 1,002,523 2,002,580 42,056,116
LESS: BAD DEBT ALLOWANCE 2,396,229 2,396,229
________________________________________________________________________________________________________________________________
NET ACCOUNTS RECEIVABLE 39,790,722 52,704 46,623 769,895 1,002,523 2,002,580 39,659,887
UNBILLED REVENUES 6,220,620 6,220,620
UNRECOVERED PURCHASED
GAS COSTS 7,953,345 7,953,345
FUEL STOCK 6,640,879 6,640,879
PREPAID EXPENSES 4,455,717 22,448 4,478,165
________________________________________________________________________________________________________________________________
TOTAL CURRENT ASSETS 65,399,074 794,320 150,856 5,294,491 3,417,190 2,002,580 73,053,351
OTHER ASSETS
INVESTMENT IN SUBSIDIARIES
AND OTHER ASSETS 2,086,741 243,756 3,180,872 126,973,652 126,973,652 5,511,369
UNAMORTIZED DEBT EXPENSE 10,773,194 10,773,194
OTHER DEFERRED DEBITS 92,589,601 79,959 484 12,809,934 293,362 $227,633 106,000,973
________________________________________________________________________________________________________________________________
TOTAL OTHER ASSETS 103,362,795 2,166,700 244,240 15,990,806 127,267,014 227,633 126,973,652 122,285,536
TOTAL ASSETS $448,054,522 $4,461,707 $398,691 $21,346,721 $130,684,204 $227,633$128,976,232 $476,197,246
============ ========== ======== ========== =========== ======= =========== ===========
</TABLE>
<TABLE>
CONNECTICUT ENERGY CORPORATION
CONSOLIDATING BALANCE SHEET
DECEMBER 31, 1997
(UNAUDITED)
<CAPTION>
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EXHIBIT A
THE CNE
SOUTHERN CNE CNE ENERGY ADJUSTMENTS/
CONNECTICUT VENTURE-TECH, DEVELOPMENT SERVICES CEC ELIMINATIONS TOTAL
ACCOUNT DESCRIPTION GAS COMPANY INC. CORPORATION GROUP, INC. HOLDING DEBIT CREDIT CEC
_______________________________________________________________________________________________________________________________
CAPITALIZATION
COMMON STOCK $ 18,760,951 $ 1,000 $ 1,000 $ 1,000 $ 10,347,988 $ 18,763,951 $ 10,347,988
CAPITAL STOCK EXPENSE (636,182) (4,421,974) (5,058,156)
CAPITAL IN EXCESS OF PAR
VALUE 95,023,812 4,500,000 100,000 4,099,000 135,221,740 112,031,029 126,913,523
UNEARNED COMPENSATION (1,487,380) (1,487,380)
RETAINED EARNINGS 52,883,506 (164,080) 167,120 2,562,615 (8,964,663) $3,821,328 50,305,826
MINIMUM PENSION LIABILITY 472,864 (472,864)
________________________________________________________________________________________________________________________________
SUBTOTAL 166,032,087 4,336,920 268,120 6,662,615 130,695,711 131,267,844 3,821,328 180,548,937
LONG-TERM DEBT 139,000,000 11,006,769 150,006,769
________________________________________________________________________________________________________________________________
TOTAL CAPITALIZATION 305,032,087 4,336,920 268,120 17,669,384 130,695,711 131,267,844 3,821,328 330,555,706
CURRENT LIABILITIES
SHORT-TERM BORROWINGS 29,400,000 400,000 29,800,000
CURRENT PORTION OF
LONG-TERM DEBT 1,320,635 1,320,635
ACCOUNTS PAYABLE 12,141,450 54,834 6 94 1,933 12,198,317
REFUNDS DUE CUSTOMERS 360,246 360,246
FEDERAL CORPORATE TAXES 3,020,125 154 (46,724) 64,509 (235,038) 2,803,026
STATE CORPORATE TAXES 1,353,267 31,233 (12,957) 101,113 15,555 1,488,211
PROPERTY TAXES 0
OTHER ACCRUED TAXES 2,875,303 3,184 1,147 39,314 2,918,948
ACCOUNTS PAYABLE-
INTERCOMPANY 21,472 24,174 22,430 1,934,504 2,002,580 0
INTEREST PAYABLE 2,547,916 8,668 2,556,584
OTHER ACCRUED LIABILITIES 5,298,994 11,208 40,999 5,351,201
CUSTOMERS' DEPOSITS 1,755,694 1,755,694
________________________________________________________________________________________________________________________________
TOTAL CURRENT LIABILITIES 58,774,467 124,787 (36,098) 3,468,837 223,449 2,002,580 60,552,862
OTHER LIABILITIES
DEFERRED FEDERAL INCOME
TAXES 73,682,424 160,500 (386,994) 335,450 73,120,480
DEFERRED STATE INCOME
TAXES 48,000 48,000
DEFERRED INVESTMENT TAX
CREDITS 2,610,968 2,610,968
OTHER 7,954,576 166,669 152,038 1,035,947 9,309,230
________________________________________________________________________________________________________________________________
TOTAL OTHER LIABILITIES 84,247,968 166,669 208,500 (234,956) 335,450 1,035,947 85,088,678
TOTAL CAPITALIZATION
& LIABILITIES $448,054,522 $4,461,707 $398,691 $21,346,721 $130,684,204 $133,605,874 $4,857,275 $476,197,246
============ ========== ======== =========== ============ ============ ========== ============
</TABLE>
<TABLE>
CONNECTICUT ENERGY CORPORATION
CONSOLIDATING STATEMENT OF CHANGES IN RETAINED EARNINGS
(UNAUDITED)
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EXHIBIT A
THE CNE
SOUTHERN CNE CNE ENERGY CONNECTICUT
CONNECTICUT VENTURE-TECH, DEVELOPMENT SERVICES ENERGY ADJUSTMENTS/
GAS COMPANY INC. CORPORATION GROUP, INC. CORPORATION ELIMINATIONS CONSOLIDATED
________________________________________________________________________________________________________________________
BALANCE - DECEMBER 31, 1997 $49,082,001 $ (80,771) $ 82,368 $ 256,909 $(8,068,229) $3,821,328 $45,093,606
ADD: NET INCOME 17,689,306 (83,309) 84,752 2,305,706 (1,070,421) 13,000 18,939,034
LESS: COMMON STOCK DIVIDENDS 13,887,801 (173,987) 13,713,814
LESS: ADJUSTMENT FOR MINIMUM
PENSION LIABILITY 472,864 472,864
REVERSAL OF PRIOR PERIOD
CONSOLIDATING ACCRUAL (13,000) (13,000)
________________________________________________________________________________________________________________________
BALANCE - DECEMBER 31, 1998 $52,883,506 $(164,080) $167,120 $2,562,615 $(8,964,663) $3,348,464 $49,832,962
=========== ========= ======== ========== =========== ========== ===========
</TABLE>
<TABLE> <S> <C>
<ARTICLE> OPUR3
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
CONSOLIDATED STATEMENT OF INCOME AND BALANCE SHEET OF CONNECTICUT ENERGY
CORPORATION AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL
STATEMENTS.
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> SEP-30-1998
<PERIOD-START> JAN-01-1998
<PERIOD-END> DEC-31-1998
<BOOK-VALUE> PER-BOOK
<TOTAL-ASSETS> 476,197
<TOTAL-OPERATING-REVENUES> 227,517
<NET-INCOME> 18,939
</TABLE>
