FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the Quarterly Period Ended June 30, 1994
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 No. 1-3274
FLORIDA POWER CORPORATION
(Exact name of registrant as specified in its charter)
FLORIDA 59-0247770
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
3201 34th Street South
St. Petersburg, FL 33711
(Address of principal executive offices)
(Zip Code)
(813) 866-5151
(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 ______
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
As of June 30, 1994, there were issued and outstanding 100
shares of the registrant's common stock without par value,
all of which were held, beneficially and of record, by
Florida Progress Corporation.
<PAGE>
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
FLORIDA POWER CORPORATION
Statements of Income
(In millions) Three Months Ended Six Months Ended
June 30, June 30,
1994 1993 1994 1993
------- ------- -------- --------
(Unaudited) (Unaudited)
OPERATING REVENUES:
Residential $272.8 $234.5 $540.3 $450.8
Commercial 122.7 112.5 225.2 204.4
Industrial 44.0 42.5 83.7 77.8
Sales for resale 26.6 26.8 57.5 50.4
Other 50.9 45.6 93.8 85.5
-------- -------- --------- ---------
517.0 461.9 1,000.5 868.9
OPERATING EXPENSES: -------- -------- --------- ---------
Operation:
Fuel used in generation 127.9 114.6 218.6 221.0
Purchased power 80.4 51.1 136.7 81.0
Deferred fuel (34.6) (12.2) (19.4) (26.9)
Other operation 100.3 91.8 208.4 176.2
-------- -------- --------- ---------
274.0 245.3 544.3 451.3
-------- -------- --------- ---------
Maintenance 33.2 33.3 63.4 66.4
Depreciation 64.9 59.2 129.4 116.8
Taxes other than income taxes 40.8 36.7 81.0 72.3
Income taxes:
Currently payable 20.1 22.4 53.6 35.8
Deferred, net 10.7 1.5 (2.5) 6.8
Investment tax credits, net (2.1) (2.1) (4.2) (4.1)
-------- -------- --------- ---------
Total income taxes 28.7 21.8 46.9 38.5
-------- -------- --------- ---------
441.6 396.3 865.0 745.3
-------- -------- --------- ---------
OPERATING INCOME 75.4 65.6 135.5 123.6
-------- -------- --------- ---------
OTHER INCOME AND DEDUCTIONS:
Allowance for equity funds used
during construction 1.6 2.2 3.1 4.8
Miscellaneous other expense, net (0.7) (0.4) (1.5) (1.0)
-------- -------- --------- ---------
0.9 1.8 1.6 3.8
-------- -------- --------- ---------
INTEREST CHARGES
Interest on long-term debt 24.3 22.4 48.2 45.3
Other interest expense 3.2 4.4 6.9 8.2
-------- -------- --------- ---------
27.5 26.8 55.1 53.5
-------- -------- --------- ---------
Allowance for borrowed funds used
during construction (1.3) (1.7) (2.4) (3.8)
-------- -------- --------- ---------
26.2 25.1 52.7 49.7
-------- -------- --------- ---------
NET INCOME 50.1 42.3 84.4 77.7
DIVIDENDS ON PREFERRED STOCK 2.5 3.2 5.0 7.1
-------- -------- --------- ---------
NET INCOME AFTER DIVIDENDS
ON PREFERRED STOCK $47.6 $39.1 $79.4 $70.6
======== ======== ========= =========
The accompanying notes are an integral part of these financial statements.
<PAGE>
FLORIDA POWER CORPORATION
Balance Sheets
(In millions)
June 30, December 31,
1994 1993
----------- -----------
ASSETS (Unaudited)
PROPERTY, PLANT AND EQUIPMENT:
Electric utility plant in service and held $5,422.3 $5,320.3
for future use
Less - Accumulated depreciation 1,916.2 1,846.2
Accumulated decommissioning for nuclear plant 124.7 118.3
Accumulated dismantlement for fossil plants 80.4 68.5
---------- ----------
3,301.0 3,287.3
Construction work in progress 264.8 285.7
Nuclear fuel, net of amortization of $309.5
in 1994 and $299.9 in 1993 66.1 68.4
---------- ----------
3,631.9 3,641.4
Other property, net 25.1 27.7
---------- ----------
3,657.0 3,669.1
---------- ----------
CURRENT ASSETS:
Cash and equivalents 7.9 -
Accounts receivable, less reserve of $2.9
in 1994 and $2.4 in 1993 186.2 168.2
Inventories at average cost:
Fuel 66.4 58.9
Materials and supplies 112.7 112.2
Underrecovery of fuel cost 31.9 7.1
Deferred income taxes 18.6 29.2
Other 5.2 5.8
---------- ----------
428.9 381.4
---------- ----------
OTHER ASSETS:
Nuclear plant decommissioning fund 116.4 107.7
Unamortized debt expense, being amortized
over term of debt 30.6 31.6
Other 86.3 69.7
---------- ----------
233.3 209.0
---------- ----------
$4,319.2 $4,259.5
========== ==========
The accompanying notes are an integral part of these financial statements.
<PAGE>
FLORIDA POWER CORPORATION
Balance Sheets
(In millions)
June 30, December 31,
1994 1993
----------- ------------
CAPITAL AND LIABILITIES (Unaudited)
COMMON STOCK EQUITY:
Common stock $920.1 $812.9
Retained earnings 703.0 709.5
---------- ----------
1,623.1 1,522.4
CUMULATIVE PREFERRED STOCK:
Without sinking funds 113.5 113.5
With sinking funds 35.0 35.0
LONG-TERM DEBT 1,379.8 1,398.6
---------- ----------
TOTAL CAPITAL 3,151.4 3,069.5
---------- ----------
CURRENT LIABILITIES:
Accounts payable 95.1 106.2
Accounts payable to associated companies 23.7 17.1
Customers' deposits 73.9 71.5
Income taxes currently payable 11.7 24.6
Accrued other taxes 40.3 8.4
Accrued interest 31.5 33.2
Other 30.9 34.2
---------- ----------
307.1 295.2
Notes payable 62.6 125.0
Current portion of long-term debt
and cumulative preferred stock 64.6 45.9
---------- ----------
434.3 466.1
---------- ----------
DEFERRED CREDITS AND OTHER LIABILITIES:
Deferred income taxes 463.4 472.7
Unamortized investment tax credits 113.6 117.8
Other 156.5 133.4
---------- ----------
733.5 723.9
---------- ----------
$4,319.2 $4,259.5
========== ==========
The accompanying notes are an integral part of these financial statements.
<PAGE>
FLORIDA POWER CORPORATION
Statements of Cash Flows
(In millions)
Six Months Ended
June 30,
1994 1993
----------- -----------
(Unaudited)
OPERATING ACTIVITIES:
Net income after dividends on preferred stock $79.4 $70.6
Adjustments for noncash items:
Depreciation and amortization 144.0 132.4
Deferred income taxes and
investment tax credits, net (6.7) 2.2
Allowance for equity funds used during construction (3.1) (4.8)
Changes in working capital:
Accounts receivable (18.0) (15.6)
Inventories (8.0) 5.0
Underrecovery of fuel costs (24.8) (32.9)
Accounts payable (11.1) 5.5
Accounts payable to associated companies 6.6 (2.3)
Income taxes currently payable (12.9) 0.4
Accrued other taxes 31.8 28.6
Other (1.2) 10.1
Other operating activities 24.9 (2.8)
---------- ----------
200.9 196.4
---------- ----------
INVESTING ACTIVITIES:
Construction additions (145.0) (172.1)
Allowance for borrowed funds used during construction (2.4) (3.8)
Additions to nonutility property (1.4) (4.9)
Acquisition of electric distribution system - (54.0)
Proceeds from sale of properties 4.4 2.4
Other investing activities (7.0) (8.5)
---------- ----------
(151.4) (240.9)
---------- ----------
FINANCING ACTIVITIES:
Issuance of long-term debt - 178.0
Repayment of long-term debt (0.5) (246.2)
Increase in commercial paper with
long term support - 104.0
Redemption of preferred stock - (45.2)
Dividends paid on common stock (85.9) (80.9)
Equity contributions from parent 107.2 45.0
Increase (decrease) in short-term debt (62.4) 89.8
---------- ----------
(41.6) 44.5
---------- ----------
NET INCREASE IN CASH AND EQUIVALENTS 7.9 -
Beginning cash and equivalents - -
---------- ----------
ENDING CASH AND EQUIVALENTS $7.9 $ -
========== ==========
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid during the period for:
Interest (net of amount capitalized) $53.0 $49.8
Income taxes (net of refunds) $66.0 $35.7
The accompanying notes are an integral part of these financial statements.
<PAGE>
FLORIDA POWER CORPORATION
Notes to Financial Statements
1) In September 1992, the Florida Public Service Commission ("FPSC") granted
Florida Power Corporation (the "Company") an annual revenue increase of
$85.8 million, to be phased in from November 1992 through November 1993 as
follows: approximately $58 million in November 1992, $9.7 million in
April 1993 and $18.1 million in November 1993. As a result of this
action, for the three and six months ended June 30, 1994, revenues
increased by $4.8 million and $11.5 million, and earnings increased by
$3.0 million and $7.1 million, respectively, compared to the same periods
last year.
2) In June 1994, the FPSC approved an agreement between the Company and the
FPSC staff to temporarily limit the Company's regulatory return on equity
("ROE") to a maximum of 12.5% for the 12 months ended December 31, 1994.
During the six months ended May 31, 1994, the Company's regulatory ROE has
ranged from 12.02% to 12.30%. The ROE range of 11% to 13% established in
the last retail rate case will resume after 1994. The Company does not
expect this temporary limit to have a material impact on its earnings or
financial position.
3) In April 1994, the Federal Energy Regulatory Commission ("FERC") approved
the Company's 1994 settlement agreement with its wholesale customers
which provided for an annual revenue increase of approximately $9.8
million effective in two stages, in March 1994 and May 1994. Neither
stage resulted in a material impact on revenues or net income for the
three or six months ended June 30, 1994.
4) In late 1993, Florida Progress Corporation, the Company's parent ("Florida
Progress"), offered an early retirement option to eligible employees, with
an effective retirement date of February 1, 1994. For the three and six
months ended June 30, 1994, the Company recorded an after-tax charge of
$1.6 million and $9.5 million, respectively, related to the "special
termination benefit" portion of the costs associated with the option.
5) Effective January 1, 1994, Financial Accounting Standard Interpretation
No. 39, "Offsetting of Amounts Related to Certain Contracts," provides
guidance regarding offsetting possible unrecognized liabilities and assets
on the balance sheet. Currently, the Financial Accounting Standards Board
is exploring the applicability of this interpretation as it relates to the
future decommissioning of nuclear power plants. If this interpretation is
determined to be applicable, the Company will record decommissioning costs
associated with its nuclear power plant as described in Note 7 to the
Financial Statements in the Company's Form 10-K for the year ended
December 31, 1993 (the "1993 Form 10-K").
6) COMMITMENTS AND CONTINGENCIES
INSURANCE COVERAGE - The Price-Anderson Act currently limits the liability
of an owner of a nuclear power plant for a single nuclear incident to $9.0
billion. The Company has purchased the maximum available commercial
nuclear liability insurance of $200 million with the balance provided by
indemnity agreements prescribed by the Nuclear Regulatory Commission
("NRC"). In the event of a nuclear incident at any United States nuclear
power plant, the Company could be assessed up to $79.3 million per
incident, with a maximum assessment of $10 million per year. The Company
has never been assessed for a nuclear incident under these indemnity
agreements. In addition to this liability insurance, the Company carries
extra expense insurance with Nuclear Electric Insurance, Ltd. ("NEIL") to
cover the cost of replacement power during any prolonged outage of the
nuclear unit. Under this policy, the Company is subject to a retroactive
premium assessment of up to $2.7 million in any year in which policy
losses exceed accumulated premiums and investment income. In addition,
the Company currently carries approximately $2.1 billion in nuclear
property insurance provided through several different policies. One of
these policies, which also is underwritten by NEIL, provides $1.4 billion
of excess coverage. Under this policy, the Company is subject to a
retroactive premium assessment of up to $6.5 million for the first loss in
any policy year in which losses exceed funds available to NEIL. In the
event of multiple losses in any policy year, the Company's aggregate
retroactive premium could total up to $13.9 million.
Effective November 1993, the FPSC authorized the Company to self-insure
its transmission and distribution lines against loss due to storm damage
and other natural disasters. On June 21, 1994, the FPSC authorized the
Company to increase the annual accrual for the storm damage reserve from
$3 million to $6 million effective January 1, 1994, and defer any losses
in excess of the reserve.
CONTAMINATED SITE CLEANUP - The Company has received notices from the
United States Environmental Protection Agency ("EPA") that it is or could
be a "potentially responsible party" under the Comprehensive Environmental
Response Compensation and Liability Act ("CERCLA") and the Superfund
Amendment and Reauthorization Act and may be liable, together with others,
for the costs of cleaning up several contaminated sites identified by the
EPA. In addition, the Company has been named as a defendant in one suit
brought against four prior owners of a coal gasification plant site,
seeking contributions pursuant to CERCLA and Florida law toward the cost
of cleaning up that site and nearby property that may have become
contaminated. The best estimates currently available to the Company
indicate that its proportionate share of liability for cleaning up the
sites ranges from $.7 million to $1.5 million, and it has a current
reserve of $1.4 million against these potential costs. Liability for such
cleanup costs is technically joint and several. However, the Company
presently has no reason to believe that it will ultimately have to pay a
significantly disproportionate share of the cleanup costs of any of the
sites. Although it does not currently contemplate a need to do so, the
Company believes that it would have a sound basis for seeking recovery
through the ratemaking process in the event it ultimately has to pay a
significantly disproportionate share of the costs of cleaning up any
contaminated site. It is recognized, however, that no such recovery would
be assured.
UNION CARBIDE LAWSUIT - The Company and Florida Power & Light Company
("FP&L") are co-defendants in an antitrust action brought by Union Carbide
Corporation, a customer of FP&L, seeking injunctive relief and damages.
The suit challenges a long-standing territorial agreement between the two
unaffiliated, neighboring utilities, notwithstanding the defendants'
contention that the agreement was clearly authorized by state law and
approved by the FPSC. The Company believes that the state action
exemption from the antitrust laws is applicable to the agreement and the
Company's consequent refusal to provide electricity to Union Carbide
Corporation. Management believes it has a strong defense and intends to
vigorously defend against this action.
7) In the opinion of management, the accompanying financial statements
include all adjustments deemed necessary to summarize fairly and reflect
the financial position and results of operations of the Company for the
interim periods presented. However, it is suggested that these financial
statements be read in conjunction with the financial statements and notes
thereto in the 1993 Form 10-K.
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations
OPERATING RESULTS
Operating Revenues
Operating revenues were $55.1 million and $131.6 million higher for the three
and six months ended June 30, 1994, respectively, compared to the same periods
in 1993. Increased residential usage, due primarily to warmer than normal
temperatures in the second quarter and colder than normal temperatures in the
beginning of the year, customer growth and the continued impact of a phased-in
rate increase, contributed to the increase in revenues. (See Note 1 to the
Financial Statements with respect to the retail rate increase.)
In April 1994, Florida Progress released certain projections concerning the
Company's growth potential. The Company's retail energy sales are projected to
grow an average of more than 4% annually during the next five years. This
anticipated increase is twice the projected national average for the electric
utility industry.
Operating Expenses
Fuel and purchased power costs were $42.6 million and $53.3 million higher for
the three and six months ended June 30, 1994, respectively, compared to the
same periods in 1993, due primarily to higher purchased power costs resulting
from increased capacity payments to non-utility generators as additional
capacity comes on line. The Company recovers substantially all of its retail
fuel and purchased power costs through a FPSC ordered fuel adjustment clause,
thereby eliminating any impact on net income.
Other operation and maintenance expenses were $8.4 million and $29.2 million
greater for the three and six months ended June 30, 1994, respectively,
compared to the same periods last year. The increase was due primarily to
costs associated with an early retirement option. An increase in the accrual
for the storm damage reserve and increased recoverable energy conservation
program costs also contributed to the higher expenses. Similar to the recovery
of fuel costs mentioned above, the Company recovers substantially all of its
energy conservation program costs, thereby eliminating any impact on net
income. (See Note 4 to the Financial Statements with respect to the early
retirement option and Note 6 with respect to the storm damage accrual.)
Other
Eleven cogenerators who sell electricity to the Company have been notified by
the Company that their energy output may need to be curtailed during minimum
load hours of the day. On July 18, 1994, the Company sent letters to each of
these qualifying facility power suppliers ("QFs") alerting them that a
curtailment program is being developed, which could lower energy payments
during these periods. Some QFs have already agreed to reduce or curtail their
output during minimum load periods. The Company has asked the FPSC to review
the QF agreements to reaffirm that they comply with commission rules. Payment
provisions in these contracts were based on the avoided costs for a
hypothetical coal unit built in 1991, as if it were operating around-the-clock,
every day. Current analysis indicates that the Company would be cycling off
such a coal unit during certain minimum load conditions. The Company expects
that payments to QFs will be reduced by implementing a curtailment program.
Payments would be less during low load periods than during peak load hours.
The changes are expected to result in a dispute with at least one QF. No
estimates of payment reductions can be made at this time.
The Company previously reported that a NRC staff report identified its nuclear
power plant, which has a Babcock & Wilcox manufactured reactor vessel, as one
of 15 nuclear plants not meeting the NRC's threshold measure for the strength
of a reactor pressure vessel. (See Item 1 under "Business-Utility
Operations-Regulation and Franchises" in the 1993 Form 10-K.) In April
1994, the NRC approved an industry trade group's analysis showing that all the
Babcock & Wilcox manufactured reactor vessels meet NRC safety criteria. This
approval was subject to the NRC receiving certain site specific documentation
from the individual plants, which the Company provided for its reactor vessel
in June 1994. This matter is now considered terminated for reporting purposes.
In June 1994, the FPSC approved an agreement between the Company and the FPSC
to temporarily limit the Company's ROE to no more than a maximum of 12.5% for
the 12 months ended December 31, 1994. (See Note 2 to the Financial
Statements.)
In July 1994, the Company completed a planned refueling outage at its nuclear
power plant in 61 days at a cost of approximately $21.3 million.
As discussed in Item 1 under the heading "Business-Competition" in the
1993 Form 10-K, the electric utility industry in general is expected to become
increasingly competitive. In this regard, the Company recently has been taking
actions in two areas. The first involves the possible annexation by the City
of Orlando of areas currently included in the Company's service territory. The
Company and the Orlando Utilities Commission are negotiating the terms of a new
territorial agreement, and the Company expects to take measures to vigorously
protect its service territory. The second involves the Company's rates and
costs. Although the Company's retail rates increased during the second quarter
1994 relative to other Florida utilities, the Company continues to believe that
it is in a good competitive position. The Company is continuing to streamline
operations and cut costs to improve its competitiveness. These actions are
expected to allow the Company to offset other rising costs such as income
taxes, environmental expenses and insurance costs. The Company expects to earn
its authorized return on equity, while achieving its competitive cost
structure, which currently compares favorably with other utilities in Florida.
LIQUIDITY AND CAPITAL RESOURCES
The Company budgeted $344 million, excluding allowance for funds used during
construction, for its 1994 construction program, of which $145 million was
spent during the first six months of the year. These expenditures were
financed primarily with funds from operations and equity contributions from
Florida Progress.
In May 1994, Florida Progress issued 3.6 million shares of common stock through
an underwritten public offering. Florida Progress contributed to the Company
the $92.2 million of proceeds from this public offering and an additional $7.5
million in June 1994 from the sale of common stock through its dividend
reinvestment and stock purchase plan. These funds were used to repay
commercial paper and for general corporate purposes.
The Company's ratio of earnings to fixed charges was 3.92 at June 30, 1994.
(See Exhibit 12 filed herewith.)
PART II. OTHER INFORMATION
Item 1. Legal Proceedings
1) FERC Docket No. ER94-961-000.
See prior discussion of this matter in the 1993 Form 10-K, Part I, Item 3,
paragraph 2 and the Company's Form 10-Q for the quarter ended March 31,
1994 (the "First Quarter 1994 Form 10-Q"), Part II, Item 1, paragraph 2.
As ordered by the FPSC, the Company has provided information to the FERC
explaining how certain fuel adjustment clause fossil fuel costs will be
imputed if actual cogeneration fossil fuel costs are not available.
FERC's review of this information is pending.
2) Florida Gas Transmission Company v. Florida Public Service
Commission, Florida Supreme Court Case No. 82,171.
See prior discussion of this matter in the 1993 Form 10-K, Part I, Item 3,
paragraph 3 and the First Quarter 1994 Form 10-Q, Part II, Item 1,
paragraph 3. On April 21, 1994, the Florida Supreme Court issued its
opinion denying Florida Gas Transmission's appeal. No petitions for
rehearing were filed within the required time period. Accordingly, this
matter is now considered terminated for reporting purposes.
3) Kim S. McDowell and Talesa C. Lloyd v. Florida Power Corporation,
United States District Court for the Middle District of Florida,
Tampa Division, Case No. 91-1858-CIV-T-23B.
See prior discussion of this matter in the 1993 Form 10-K, Part I, Item 3,
paragraph 5. On April 19, 1994, the Court granted plaintiff's motion to
amend the complaint to bring the suit as a class action. On April 26,
1994, the plaintiffs filed an amended complaint which was intended to
clarify the earlier sexual discrimination and harassment complaint, but
did not raise class action allegations. The Company believes that its
exposure in this matter will not be material even if it is unsuccessful in
defending against the individual claims of the named plaintiffs. At this
time, the claimants have not plead any claims asserting class action
status. No trial date has been set at this time.
4) Northern States Power Company, et al., v. United States Department of
Energy, Case Number 94-1457, U.S. Court of Appeals, D.C. Circuit.
On June 20, 1994, the Company joined with 13 other nuclear utilities in an
action brought against the United States Department of Energy ("DOE")
under the terms of the Nuclear Waste Policy Act ("NWPA"). The NWPA
requires DOE to accept responsibility for spent nuclear fuel ("SNF") and
high level radioactive waste ("HLW") by January 31, 1998. DOE has
announced that it will not meet that deadline. The utilities seek a
declaration that the NWPA imposes on DOE an unconditional obligation to
accept SNF and HLW by January 31, 1998, and an order directing DOE to
develop a program with milestones and appropriate reporting requirements,
to ensure DOE's compliance with the statutorily mandated date. Failure of
DOE to accept SNF and HLW will not immediately affect the Company, which
has sufficient on-site storage capacity for spent fuel through about the
year 2010. If, however, DOE does not begin accepting spent fuel and
high-level waste, eventually the Company will be forced to seek other
temporary storage options.
Item 5. Other
1) Reference is made to the first paragraph under Item 2 "Operating
Results-Other" in the First Quarter 1994 Form 10-Q.
If the FPSC approves the Company's recommended change in depreciation
rates, the Company now believes that annual depreciation expense will
remain nearly unchanged.
2) Reference is made to paragraphs 4-6 under Item 2 "Operating Results-Other"
in the First Quarter 1994 Form 10-Q.
In July 1994, the NRC issued a memorandum to its staff recommending that
utilities be required either to fix or replace the Thermolag at their
plants, or demonstrate why other options are more appropriate. The
Company has not yet completed its study of the feasibility and cost of the
various alternatives.
3) Reference is made to Item 1 "Business-Environmental Matters-Waste
Materials" in the 1993 Form 10-K.
All transformers contaminated with polychlorinated biphenyls ("PCBs") now
have been removed from all of the Company's electric generating plants,
except for one small plant. Removal of PCBs from this final plant will be
delayed until the Company decides whether and for how long the plant will
remain in operation.
4) Reference is made to Item 1 "Business-Environmental Matters-Storage Tank
Program" in the 1993 Form 10-K.
The storage tank requirements of the Florida Department of Environmental
Protection have varying compliance dates ranging from 1998 to 2009. The
Company now expects to complete its storage tank program in accordance
with the applicable compliance dates, rather than satisfying all
requirements by 1999.
5) Change of Trustee and Issuing/Paying Agent
The Company has changed the Trustees under an Indenture pursuant to which
it issues certain debt securities. Effective July 25, 1994, Morgan
Guaranty Trust Company of New York and First Union National Bank of
Florida resigned and were removed as Trustee and Co-Trustee, respectively,
under the Company's Indenture dated as of January 1, 1944, pursuant to
which the Company issues its first mortgage bonds. The Company has
appointed First Chicago Trust Company of New York as successor Trustee,
and First Chicago has accepted such appointment. Unless and until the
Company shall appoint another Co-Trustee, all the right, title and powers
of the Trustee under the Indenture shall be with First Chicago and its
successors alone. In addition, effective in 1993, NationsBank of Florida,
N.A. became the successor by merger to NCNB Bank of Florida, and therefore
automatically became the successor Trustee under the Indenture dated as of
August 15, 1992 between the Company and NCNB, pursuant to which the
Company issues its medium-term notes.
6) Frank C. Logan has been elected to the Company's Board of Directors
effective August 1, 1994. Mr. Logan is engaged in the practice of estate
planning and probate and corporate and business law. He is board chairman
and a trustee of Morton F. Plant Hospital in Clearwater, Florida, and he
has served on the board of directors of the Morton F. Plant Hospital
Foundation and the Clearwater Chamber of Commerce. He is also director of
the Florida Hospital Association and Volunteer Trustees of Not-for-Profit
Hospitals and serves on the Executive Committee and Board of Directors of
the Performing Arts Center and the Theater of Ruth Eckerd Hall.
7) FPSC Commissioner Resigns
Luis J. Lauredo resigned from the FPSC in April 1994. In July 1994, the
Public Service Commission Nominating Council selected three nominees for
the now vacant position. The Governor of Florida will have 60 days to
choose a new Commissioner from among the three nominees.
<PAGE>
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits:
Exhibit Number Description
12 Statement Regarding Computation of
Ratio of Earnings to Fixed Charges.
(b) Reports on Form 8-K:
During the second quarter 1994, the Company filed the
following report on Form 8-K:
Form 8-K dated April 21, 1994, reporting under
Item 5 "Other Events" the Company's and Florida
Progress' first quarter 1994 earnings, and Florida
Progress' plans to issue up to 3,795,000 shares
of common stock.
In addition, the Company filed the following report on Form 8-K
subsequent to the second quarter 1994:
Form 8-K dated July 21, 1994, reporting under
Item 5 "Other Events" the Company's and Florida
Progress' second quarter 1994 earnings.
<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.
FLORIDA POWER CORPORATION
Date: August 5, 1994 /s/ Jeffrey R. Heinicka
-------------------------
Jeffrey R. Heinicka
Senior Vice President and
Chief Financial Officer
Date: August 5, 1994 /s/ David R. Kuzma
-------------------------
David R. Kuzma
Vice President and Treasurer
<PAGE>
Exhibit Index
Exhibit Number Description
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12 Statement Regarding Computation of Ratio
of Earnings to Fixed Charges.
Exhibit 12
FLORIDA POWER CORPORATION
STATEMENT REGARDING COMPUTATION OF RATIO OF EARNINGS
TO FIXED CHARGES
(Dollar Amounts in Thousands)
Twelve Months
Ended
June 30, 1994
(Unaudited)
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Earnings:
Net Income. . . . . . . . . . . . . . . . . $ 201,534
Net Taxes . . . . . . . . . . . . . . . . . 112,656
Fixed Charges . . . . . . . . . . . . . . . 107,492
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$ 421,682
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Ratio of Earnings to Fixed Charges . . . . . . . . . 3.92
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