SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (date of
earliest event reported): December 19, 1997
GPU, Inc.
(Exact name of registrant as specified in charter)
Pennsylvania 1-6047 13-5516989
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(State or other (Commission (IRS employer
jurisdiction of file number) identification no.)
incorporation)
300 Madison Avenue, Morristown, New Jersey 07962-1911
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (973) 455-8200
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ITEM 5. OTHER EVENTS.
1. 1997 Results Of Operations.
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On January 20, 1998, the Company reported earnings for the
year ended December 31, 1997 of $335.1 million, or $2.77 per share, as compared
to 1996 earnings of $298.4 million, or $2.47 per share. Operating revenues for
1997 were $4,143.4 million as compared to 1996 operating revenues of $3,970.7
million.
Earnings for 1997 included a previously reported non-recurring
charge of $109.3 million, or $0.90 per share, for a windfall profits tax imposed
by the Government of the United Kingdom on privatized utilities, including
Midlands Electricity plc, in which the Company owns a 50% share. In 1996, the
Company reported a non-recurring charge of $74.5 million, or $0.62 per share,
for the costs related to voluntary enhanced retirement programs.
The 1997 earnings increase was mainly due to increased
earnings from the GPU International Group (including the result of the Company's
policy of accruing U.S. income tax on its wordwide operations, which reduced its
federal income tax liability by 31 cents per share); reduced operation and
maintenance expenses; increased kilowatt sales to domestic utility customers;
and the recording of step increases in operating revenues by Metropolitan Edison
Company and Pennsylvania Electric Company as a result of including their energy
cost rates in base rates and the cessation of deferred energy accounting, both
effective January 1, 1997. These increases were partially offset by higher
depreciation and financing expenses, increased amortizations due to a rate cap
on
<PAGE>
Jersey Central Power & Light Company's earnings and the absence, in 1997, of
gains associated with the 1996 reacquisition of preferred stock.
The Company also reported earnings for the quarter ended
December 31, 1997 of $92.9 million, or $0.77 per share, as compared to $80.7
million, or $0.67 per share, for the same period in 1996.
A copy of the Company's related news release is annexed as an
exhibit.
2. Amendment to By-Laws.
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Effective December 19, 1997, the Company amended Section 1 of
its By-Laws to reflect a change in its principal office from Parsippany, New
Jersey to the County of Morris, State of New Jersey.
A copy of the amendment to the Company's By-Laws is annexed as
an exhibit.
Item 7. Financial Statements, Pro Forma Financial
Information and Exhibits.
(c) Exhibits.
1. GPU News Release, dated January 20, 1998.
2. Text of Amendment to Section 1 of By-Laws of
GPU, Inc. effective December 19, 1997.
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SIGNATURE
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.
GPU, INC.
By:______________________________
T.G. Howson
Vice President and Treasurer
Date: January 20, 1998
EXHIBIT TO BE FILED BY EDGAR
Item 7. Financial Statements, Pro Forma Financial
Information and Exhibits.
(c) Exhibits.
1. GPU News Release, dated January 20, 1998.
2. Text of Amendment to Section 1 of By-Laws of
GPU, Inc. effective December 19, 1997.
Date: January 20, 1998
Further Information: Ron T. Morano, 973-644-4297
For Release: Immediately
Release Number: 98-02
GPU ANNOUNCES INCREASED 1997 EARNINGS
MORRISTOWN, N.J., January 20, 1998 -- GPU, Inc. (NYSE:GPU) today
reported 1997 earnings of $335.1 million, compared with 1996 earnings of $298.4
million. Earnings per share was $2.77 for 1997, compared to $2.47 for 1996. Both
periods include a non-recurring charge.
In 1997, a non-recurring charge of $109.3 million, or $0.90 per share,
was taken for a windfall profits tax assessed by the Government of the United
Kingdom on privatized utilities, including Midlands Electricity plc (Midlands),
in which GPU has a 50% stake. In 1996, a non-recurring charge of $74.5 million,
or $0.62 per share, was taken for costs related to voluntary enhanced retirement
programs.
The 1997 earnings increase was mainly due to increased earnings from
the GPU International Group (including the result of GPU's policy of accruing
U.S. income tax on its worldwide operations, which reduced GPU's federal income
tax liability by 31 cents per share); reduced operation and maintenance
expenses; increased KWH sales to domestic utility customers; and the recording
of step increases in operating revenues by Metropolitan Edison Company and
Pennsylvania Electric Company as a result of including their energy cost rates
in base rates and the cessation of deferred energy accounting, both effective
January 1, 1997. These increases were partially offset by higher depreciation
and financing expenses, increased amortizations due to a rate cap on Jersey
Central Power & Light Company earnings and the absence, in 1997, of gains
associated with the 1996 reacquisition of preferred stock.
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GPU, Inc. is a registered electric utility holding company. Our three
domestic electric utility subsidiaries -- Jersey Central Power & Light Company,
Metropolitan Edison Company and Pennsylvania Electric Company -- doing business
as GPU Energy, annually provide approximately 43 billion kilowatt-hours of
electricity to 2 million customers in New Jersey and Pennsylvania. GPU also owns
the GPU International Group, which includes our investment in GPU PowerNet, the
owner and operator of the electrical transmission system in the Australian State
of Victoria. The GPU International Group also has a 50% ownership interest in
Midlands, a distribution and supply business located in England serving
approximately 2.2 million customers; and ownership interests in generation
facilities located in the United States and foreign countries.
Financial Summary:
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- - Kilowatt-hour sales to domestic utility customers for 1997 increased 1.0%
to 43.0 billion as compared to 1996 mainly due to higher usage by existing
customers and an increase in the number of customers.
- - Operating revenues for 1997 increased 4.3% to $4.1 billion versus 1996 due
to increased KWH sales to domestic utility customers.
- - Excluding the effect of the $109.3 million non-recurring charge
for the windfall profits tax, the GPU International Group's
earnings for 1997 increased $51.7 million versus 1996. The
increase reflects increased earnings from the annualized effect
of the May 1996 acquisition of Midlands. In addition, as a
result of GPU's policy of accruing U.S. income tax on its
worldwide operations, GPU's federal income tax liability has
been reduced.
Earnings for the fourth quarter of 1997 were $92.9 million, compared
with $80.7 million for 1996. Earnings per share for the quarter was $0.77 for
1997, compared to $0.67 for 1996. Primarily, the same items affecting the 1997
results also affected the fourth quarter results. In addition, the reversal of a
valuation reserve, discussed below, and higher energy and reserve capacity
expenses also affected the fourth quarter results.
On November 6, 1997, GPU acquired PowerNet Victoria (renamed GPU
PowerNet), which owns and operates the electrical transmission system in the
Australian State of Victoria. In the third quarter of 1997, GPU recorded a
valuation reserve as a result of its planned sale of Solaris Power due to
Victoria's cross-ownership restrictions and the impending PowerNet acquisition.
In the fourth quarter of 1997, the valuation reserve was reversed after a
determination was made that Solaris would be sold at a profit. In January 1998,
the sale of Solaris was completed resulting in an after-tax gain of $12.6
million.
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<TABLE>
<CAPTION>
Twelve Months Ended December 31, 1997 1996
- -------------------------------- ---- ----
(Unaudited)
<S> <C> <C>
Sales to customers (gigawatt-hours) (Note 1) 42,951 42,513
Operating revenues (000) $4,143,379 $3,970,711
Net income (000)(Notes 2 and 3) $ 335,101 $ 298,352
Basic - Earnings per share (Notes 2 and 3) $ 2.78 $ 2.48
- Average common shares outstanding (000) 120,722 120,513
Diluted - Earnings per share (Notes 2 and 3) $ 2.77 $ 2.47
- Average common shares outstanding (000) 121,002 120,751
</TABLE>
<TABLE>
<CAPTION>
Three Months Ended December 31, (Unaudited) 1997 1996
- ------------------------------------------- ---- ----
<S> <C> <C>
Sales to customers (gigawatt-hours) (Note 1) 10,400 10,188
Operating revenues (000) $1,032,444 $ 939,871
Net income (000) $ 92,910 $ 80,653
Basic - Earnings per share $ 0.77 $ 0.67
- Average common shares outstanding (000) 120,805 120,582
Diluted - Earnings per share $ 0.77 $ 0.67
- Average common shares outstanding (000) 121,070 120,820
Note 1: Gigawatt-hour sales pertain to GPU Energy only and exclude
interchange sales.
Note 2: Earnings for 1997 include an after-tax charge to income of
$109.3 million, or $0.90 per share, for a windfall profits tax
assessed on privatized utilities, including Midlands Electricity,
in which GPU has a 50% stake, by the Government of the United
Kingdom.
Note 3: Earnings for 1996 include an after-tax charge to income of
$74.5 million, or $0.62 per share, for costs related to voluntary
enhanced retirement programs.
- XX -
</TABLE>
Exhibit C-2
GPU, INC.
AMENDMENT TO BY-LAWS
(Effective December 19, 1997)
Offices
1. The principal office of the Corporation shall be in the County of
Morris, State of New Jersey. The Corporation may also have offices at such other
places as the Board of Directors may from time to time designate or the business
of the Corporation may require.
