SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
__________________________________
FORM 8-K/1A
__________________________________
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Event (Date of earliest event reported): January 31, 1995
Date of Report: February 15, 1995
INDIANAPOLIS POWER & LIGHT COMPANY
(Exact name of registrant as specified in its charter)
Indiana 1-3132-2 35-0413620
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
25 Monument Circle, Indianapolis, Indiana 46204
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (317) 261-8261
<PAGE>
Item 5. Other Events
On January 31, 1995, IPALCO Enterprises, Inc. announced the fiscal
1994 results for the year ended December 31, 1994, for
Indianapolis Power & Light Company, IPALCO's principal subsidiary.
Utility operating revenue for the year ended December 31, 1994,
was $686.1 million, compared to $664.3 million during fiscal 1993.
Utility net income was $103.8 million for the fiscal year ended
December 31, 1994, compared to $102.8 million during fiscal 1993.
Item 7. Exhibits
(23) Independent Auditors' Consent.
(27) Financial Data Schedule.
(99) Copy of press release issued by IPALCO Enterprises, Inc., parent
of Indianapolis Power & Light Company, relating to earnings for
year ended December 31, 1994.
(99) Audited 1994 Financial Reports.
<PAGE>
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 hereunto duly authorized.
Dated: February 15, 1995
INDIANAPOLIS POWER & LIGHT COMPANY
By /s/ John R. Brehm
Name: John R. Brehm
Title: Senior Vice President
Exhibit 23
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in Registration Statements No.
33-51737 and No. 33-52489 both on Form S-3 of Indianapolis Power & Light
Company and Registration Statement No. 2-88352 on Form S-8 of IPALCO
Enterprises, Inc. of our report dated January 27, 1995, appearing in the
Current Report on Form 8-K of Indianapolis Power & Light Company.
/s/ Deloitte & Touche LLP
Indianapolis, Indiana
February 15, 1995
<TABLE> <S> <C>
<ARTICLE> UT
<CIK> 0000050217
<NAME> INDIANAPOLIS POWER & LIGHT COMPANY
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1994
<PERIOD-START> JAN-01-1994
<PERIOD-END> DEC-31-1994
<BOOK-VALUE> PER-BOOK
<TOTAL-NET-UTILITY-PLANT> 1,711,772
<OTHER-PROPERTY-AND-INVEST> 2,898
<TOTAL-CURRENT-ASSETS> 156,792
<TOTAL-DEFERRED-CHARGES> 120,635
<OTHER-ASSETS> 0
<TOTAL-ASSETS> 1,992,097
<COMMON> 324,537
<CAPITAL-SURPLUS-PAID-IN> 0
<RETAINED-EARNINGS> 399,862
<TOTAL-COMMON-STOCKHOLDERS-EQ> 725,762
0
51,898
<LONG-TERM-DEBT-NET> 654,121
<SHORT-TERM-NOTES> 26,400
<LONG-TERM-NOTES-PAYABLE> 0
<COMMERCIAL-PAPER-OBLIGATIONS> 0
<LONG-TERM-DEBT-CURRENT-PORT> 350
0
<CAPITAL-LEASE-OBLIGATIONS> 0
<LEASES-CURRENT> 0
<OTHER-ITEMS-CAPITAL-AND-LIAB> 533,566
<TOT-CAPITALIZATION-AND-LIAB> 1,992,097
<GROSS-OPERATING-REVENUE> 686,076
<INCOME-TAX-EXPENSE> 55,543
<OTHER-OPERATING-EXPENSES> 487,223
<TOTAL-OPERATING-EXPENSES> 542,766
<OPERATING-INCOME-LOSS> 143,310
<OTHER-INCOME-NET> 3,968
<INCOME-BEFORE-INTEREST-EXPEN> 147,278
<TOTAL-INTEREST-EXPENSE> 43,455
<NET-INCOME> 103,823
3,182
<EARNINGS-AVAILABLE-FOR-COMM> 100,641
<COMMON-STOCK-DIVIDENDS> 79,239
<TOTAL-INTEREST-ON-BONDS> 45,566
<CASH-FLOW-OPERATIONS> 207,698
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
Exhibit 99
Steve Meyer 317-261-8995
John Brehm 317-261-8416
Steve Plunkett 317-261-8013
IPALCO ENTERPRISES, INC.
REPORTS FINANCIAL RESULTS FOR 1994
Indianapolis, IN, January 31, 1995 -- IPALCO Enterprises, Inc. (NYSE:
IPL), today announced financial results for 1994.
Net income for the year ended December 31, 1994, was $93.0 million, or
$2.46 per share, compared to $75.4 million, or $2.00 per share, during the
comparable period in 1993. During the fourth quarter of 1994, net income was
$17.6 million, or 47 cents per share, compared to $18.0 million, or 48 cents
per share, in 1993.
Utility operating revenues during 1994 were $686.1 million versus $664.3
million during 1993. Retail kilowatthour sales during 1994 increased 1.7
percent compared to 1993. The increase in sales is primarily attributable to
the continued strength of the service territory's economy.
Cooling degree days were up 4.2 percent above normal during 1994, and
heating degree days were 7.5 percent below normal. Sales to industrial
customers, which are less weather-sensitive, increased 2.2 percent in 1994,
compared to 1993.
Reported earnings rebounded, principally, because 1993 earnings were
impacted by the expenses IPALCO incurred in its attempt to acquire PSI
Resources, Inc.
- more -
<PAGE>
- add one -
Commenting on the results, John R. Hodowal, Chairman and Chief Executive
Officer of IPALCO, said "IPALCO employees and shareholders can be proud that,
as our low-cost energy businesses continue to expand, we are helping all our
customers to be more competitive.
"As a result of significant customer demand for district air conditioning
in Indianapolis, Mid-America Energy Resources grew last year to become one of
the largest district cooling systems in the nation. In addition,
Mid-America's subsidiary, Cleveland District Cooling, is successfully
competing against two other energy providers for air conditioning contracts in
Cleveland, Ohio. Customers are beginning to appreciate that district cooling
is a unique, low-cost alternative to traditional building air conditioning
systems.
Hodowal concluded, "We at IPALCO are confident that we can continue to
provide not only some of the lowest cost electric energy anywhere but also
unique products and services like district air conditioning, campus energy,
and energy storage."
IPALCO Enterprises, Inc., is a multi-state energy company providing a
variety of energy products and services. IPALCO's primary subsidiary,
Indianapolis Power & Light Company, provides retail electric service to
approximately 400,000 commercial, residential and industrial customers in
Indianapolis and in portions of other Central Indiana counties.
- more -
<PAGE>
- add two -
IPALCO Enterprises, Inc.
Fourth Quarter Earnings Report
December 1994
Three Months Ended Twelve Months Ended
(In thousands except December 31 December 31
for per-share amounts) 1994 1993 1994 1993
Earnings Per Share
of Common Stock $ .47 $ .48 $ 2.46 $ 2.00
Utility Operating
Revenues $160,095 $158,870 $686,076 $664,303
Utility Operating
Income $ 29,518 $ 30,426 $143,310 $142,368
Net Income $ 17,591 $ 18,047 $ 92,994 $ 75,422
Weighted Average
Shares of Common
Stock Outstanding 37,756 37,681 37,741 37,668
# # #
EXHIBIT 99
1994
Financial Reports
INDIANAPOLIS POWER & LIGHT COMPANY
Balance Sheets and Statements of Capitalization as of December 31, 1994 and
1993, and Statements of Income, Retained Earnings and Cash Flows for the Years
Ended December 31, 1994, 1993 and 1992, and Independent Auditors' Report.
INDEPENDENT AUDITORS' REPORT
----------------------------
To the Board of Directors of
INDIANAPOLIS POWER & LIGHT COMPANY:
We have audited the accompanying balance sheets and statements of
capitalization of Indianapolis Power & Light Company as of December 31,
1994 and 1993, and the related statements of income, retained earnings, and
cash flows for each of the three years in the period ended December 31,
1994. These financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these financial
statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles
used and significant estimates made by management, as well as evaluating
the overall financial statement presentation. We believe that our audits
provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of Indianapolis Power &
Light Company as of December 31, 1994 and 1993, and the results of its
operations and its cash flows for each of the three years in the period
ended December 31, 1994 in conformity with generally accepted accounting
principles.
/s/ Deloitte & Touche LLP
Deloitte & Touche LLP
Indianapolis, Indiana
January 27, 1995
-1-
<TABLE>
INDIANAPOLIS POWER & LIGHT COMPANY
Statements of Income
For the Years Ended December 31, 1994, 1993 and 1992
<CAPTION>
1994 1993 1992
--------------- --------------- ---------------
(In Thousands)
<S> <C> <C> <C>
OPERATING REVENUES (Note 9):
Electric $ 649,767 $ 629,327 $ 599,203
Steam 36,309 34,976 34,000
--------------- --------------- ---------------
Total operating revenues 686,076 664,303 633,203
--------------- --------------- ---------------
OPERATING EXPENSES:
Operation:
Fuel 169,756 158,390 155,072
Other 104,273 100,890 100,447
Power purchased 19,060 19,407 7,804
Purchased steam 7,653 8,051 7,612
Maintenance 68,562 67,326 62,446
Depreciation and amortization 87,028 78,372 78,615
Taxes other than income taxes 30,891 29,627 31,348
Income taxes - net (Note 8) 55,543 59,872 55,619
--------------- --------------- ---------------
Total operating expenses 542,766 521,935 498,963
--------------- --------------- ---------------
OPERATING INCOME 143,310 142,368 134,240
--------------- --------------- ---------------
OTHER INCOME AND (DEDUCTIONS):
Allowance for equity funds used during construction 4,672 2,010 1,985
Other - net (1,527) (1,237) (2,872)
Income taxes - net (Note 8) 823 599 1,143
--------------- --------------- ---------------
Total other income - net 3,968 1,372 256
--------------- --------------- ---------------
INCOME BEFORE INTEREST CHARGES 147,278 143,740 134,496
--------------- --------------- ---------------
INTEREST CHARGES:
Interest on long-term debt 45,566 41,399 42,663
Allowance for borrowed funds used during construction (4,709) (3,517) (3,096)
Other interest 1,497 2,305 1,251
Amortization of redemption premiums and expenses on
debt - net 1,101 787 620
--------------- --------------- ---------------
Total interest charges 43,455 40,974 41,438
--------------- --------------- ---------------
NET INCOME 103,823 102,766 93,058
PREFERRED DIVIDEND REQUIREMENTS 3,182 3,182 3,182
--------------- --------------- ---------------
INCOME APPLICABLE TO COMMON STOCK $ 100,641 $ 99,584 $ 89,876
=============== =============== ===============
See notes to financial statements.
-2-
</TABLE>
<TABLE>
INDIANAPOLIS POWER & LIGHT COMPANY
Balance Sheets
December 31, 1994 and 1993
<CAPTION>
ASSETS 1994 1993
- ----------------------------------- ---------------- ----------------
(In Thousands)
<S> <C> <C>
UTILITY PLANT:
Utility plant in service (Note 2) $ 2,415,531 $ 2,300,682
Less accumulated depreciation 916,943 876,054
---------------- ----------------
Utility plant in service - net 1,498,588 1,424,628
Construction work in progress 191,010 168,480
Property held for future use 22,174 15,763
---------------- ----------------
Utility plant - net 1,711,772 1,608,871
---------------- ----------------
OTHER PROPERTY -
At cost, less accumulated depreciation 2,898 1,873
---------------- ----------------
CURRENT ASSETS:
Cash and cash equivalents 7,835 8,349
Accounts receivable (less allowance for doubtful
accounts - 1994, $743,000 and 1993, $626,000) 46,097 47,365
Receivable from parent 1,881 5,482
Fuel - at average cost 37,161 35,213
Materials and supplies - at average cost 55,642 54,847
Prepayments and other current assets 8,176 3,240
---------------- ----------------
Total current assets 156,792 154,496
---------------- ----------------
DEFERRED DEBITS:
Unamortized Petersburg Unit 4 carrying charges 32,521 30,587
Unamortized redemption premiums and expenses on debt (Note 6) 27,577 25,453
Other regulatory assets (Note 4) 53,661 32,954
Miscellaneous 6,876 16,072
---------------- ----------------
Total deferred debits 120,635 105,066
---------------- ----------------
TOTAL $ 1,992,097 $ 1,870,306
================ ================
See notes to financial statements.
-3-
</TABLE>
<TABLE>
<CAPTION>
CAPITALIZATION AND LIABILITIES 1994 1993
- ---------------------------------------------------- ---------------- ----------------
(In Thousands)
<S> <C> <C>
CAPITALIZATION (See Statements of Capitalization):
Common shareholder's equity $ 725,762 $ 705,149
Cumulative preferred stock 51,898 51,898
Long-term debt 654,121 532,260
---------------- ----------------
Total capitalization 1,431,781 1,289,307
---------------- ----------------
CURRENT LIABILITIES:
Notes payable - banks and commercial paper (Note 7) 26,400 90,000
Current maturities and sinking fund requirements 350 8,729
Accounts payable and accrued expenses 95,957 74,187
Dividends payable 20,834 20,024
Payrolls accrued 4,475 4,505
Taxes accrued 16,787 21,377
Interest accrued 14,859 11,150
Other current liabilities 8,823 5,316
---------------- ----------------
Total current liabilities 188,485 235,288
---------------- ----------------
DEFERRED CREDITS AND OTHER LONG-TERM LIABILITIES:
Accumulated deferred income taxes - net (Note 8) 282,062 270,182
Unamortized investment tax credit 53,762 57,029
Accrued postretirement benefits (Note 10) 34,517 17,668
Miscellaneous 1,490 832
---------------- ----------------
Total deferred credits and other long-term liabilities 371,831 345,711
---------------- ----------------
COMMITMENTS AND CONTINGENCIES (Note 11)
TOTAL $ 1,992,097 $ 1,870,306
================ ================
See notes to financial statements.
-4-
</TABLE>
<TABLE>
INDIANAPOLIS POWER & LIGHT COMPANY
Statements of Cash Flows
For the Years Ended December 31, 1994, 1993 and 1992
<CAPTION>
1994 1993 1992
--------------- ---------------- ----------------
(In Thousands)
<S> <C> <C> <C>
CASH FLOWS FROM OPERATIONS:
Net income $ 103,823 $ 102,766 $ 93,058
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization 88,371 79,412 79,297
Deferred income taxes and investment tax
credit adjustments, net 2,650 (430) 216
Allowance for funds used during construction (9,381) (5,476) (5,081)
Decrease (increase) in certain assets:
Accounts receivable 4,869 (3,462) (5,659)
Fuel, materials and supplies (2,743) 10,633 (7,992)
Other current assets (4,936) (1,080) (110)
Increase (decrease) in certain liabilities:
Accounts payable 21,770 7,229 14,470
Taxes accrued (4,590) (2,195) 1,054
Other current liabilities 7,865 (2,458) 2,801
--------------- ---------------- ----------------
Net cash provided by operating activities 207,698 184,939 172,054
--------------- ---------------- ----------------
CASH FLOWS FROM INVESTING:
Construction expenditures (178,295) (145,765) (112,037)
Other 5,847 (8,447) (13,676)
--------------- ---------------- ----------------
Net cash used in investing activities (172,448) (154,212) (125,713)
--------------- ---------------- ----------------
CASH FLOWS FROM FINANCING:
Issuance of long-term debt 200,000 96,500 80,000
Retirement of long-term debt - including premiums (87,291) (98,978) (79,958)
Short-term debt - net (63,600) 50,000 37,000
Dividends paid (82,421) (79,253) (76,072)
Other (2,452) (1,228) (1,142)
--------------- ---------------- ----------------
Net cash used in financing activities (35,764) (32,959) (40,172)
--------------- ---------------- ----------------
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS (514) (2,232) 6,169
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 8,349 10,581 4,412
--------------- ---------------- ----------------
CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 7,835 $ 8,349 $ 10,581
=============== ================ ================
Supplemental disclosures of cash flow information:
Cash paid during the year for:
Interest (net of amount capitalized) $ 40,747 $ 42,489 $ 41,649
=============== ================ ================
Income taxes $ 59,129 $ 61,806 $ 56,136
=============== ================ ================
See notes to financial statements.
-5-
</TABLE>
<TABLE>
INDIANAPOLIS POWER & LIGHT COMPANY
Statements of Capitalization
December 31, 1994 and 1993
<CAPTION>
1994 1993
----------------- -----------------
(In Thousands)
<S> <C> <C>
COMMON SHAREHOLDER'S EQUITY:
Common stock, no par, authorized - 20,000,000 shares,
issued and outstanding - 17,206,630 shares (Note 5) $ 324,537 $ 324,537
Premium on 4% cumulative preferred stock 1,363 1,363
Retained earnings 399,862 379,249
----------------- -----------------
Total common shareholder's equity $ 725,762 $ 705,149
================= =================
CUMULATIVE PREFERRED STOCK (Note 5):
Nonredeemable - $100 par value, authorized
2,000,000 shares Call Price at
December 31, 1994
-----------------
4% Series, 100,000 shares $118.00 $ 10,000 $ 10,000
4.20% Series, 39,000 shares 103.00 3,900 3,900
4.60% Series, 30,000 shares 103.00 3,000 3,000
4.80% Series, 50,000 shares 101.00 5,000 5,000
6% Series, 100,000 shares 102.00 10,000 10,000
8.20% Series, 199,985 shares 101.00 19,998 19,998
----------------- -----------------
Total cumulative preferred stock $ 51,898 $ 51,898
================= =================
VARIABLE CLASS PREFERRED STOCK:
Par value undetermined, authorized
3,000,000 shares, none issued
LONG-TERM DEBT (Notes 2 and 6):
First mortgage bonds:
4 1/2% Series, due August 1994 $ - $ 7,500
5 1/8% Series, due April 1996 15,200 15,400
5 5/8% Series, due May 1997 11,550 11,629
7 1/8% Series, due May 1998 - 19,750
7.40% Series, due March 2002 - 33,200
7.65% Series, due March 2003 - 25,200
6.05% Series, due February 2004 80,000 -
8% Series, due October 2006 58,800 58,800
7 3/8% Series, due August 2007 80,000 80,000
9 5/8% Series, due September 2012 40,000 40,000
10 5/8% Series, due December 2014 40,000 40,000
6.10% Series, due January 2016 41,850 41,850
5.40% Series, due August 2017 24,650 24,650
9 5/8% Series, due June 2019 50,000 50,000
7.45% Series, due August 2019 23,500 23,500
5.50% Series, due October 2023 30,000 30,000
7.05% Series, due February 2024 100,000 -
Unamortized discount - net (1,079) (490)
----------------- -----------------
Total first mortgage bonds 594,471 500,989
Long-term note, variable rate, Series 1991, due August 2021 40,000 40,000
Long-term note, variable rate, Series 1994A, due December 2024 20,000 -
Current maturities and sinking fund requirements (350) (8,729)
----------------- -----------------
Total long-term debt $ 654,121 $ 532,260
================= =================
TOTAL CAPITALIZATION $ 1,431,781 $ 1,289,307
================= =================
See notes to financial statements.
-6-
</TABLE>
<TABLE>
INDIANAPOLIS POWER & LIGHT COMPANY
Statements of Retained Earnings
For the Years Ended December 31, 1994, 1993 and 1992
<CAPTION>
1994 1993 1992
--------------- ---------------- ----------------
(In Thousands)
<S> <C> <C> <C>
RETAINED EARNINGS AT BEGINNING OF YEAR $ 379,249 $ 356,513 $ 340,323
NET INCOME 103,823 102,766 93,058
--------------- ---------------- ----------------
Total 483,072 459,279 433,381
DEDUCT:
Cash dividends declared:
Cumulative preferred stock - at prescribed
rate of each series (See Statements of
Capitalization) 3,182 3,182 3,182
Common stock 80,028 76,848 73,686
--------------- ---------------- ----------------
Total 83,210 80,030 76,868
--------------- ---------------- ----------------
RETAINED EARNINGS AT END OF YEAR $ 399,862 $ 379,249 $ 356,513
=============== ================ ================
See notes to financial statements.
-7-
</TABLE>
INDIANAPOLIS POWER & LIGHT COMPANY
Notes to Financial Statements
For the Years Ended December 31, 1994, 1993 and 1992
----------------------------------------------------
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
All the outstanding common stock of Indianapolis Power & Light
Company (IPL) is owned by IPALCO Enterprises, Inc. At December 31, 1994
and 1993, IPL had a receivable, which is due on demand, for advances
made to IPALCO.
System of Accounts--The accounts of IPL are maintained in
accordance with the system of accounts prescribed by the Indiana Utility
Regulatory Commission (IURC), which system substantially conforms to
that prescribed by the Federal Energy Regulatory Commission.
Revenues--Revenues are recorded as billed to customers on a monthly
cycle billing basis. Revenue is not accrued for energy delivered but
unbilled at the end of the year. A fuel adjustment charge provision,
which is established after public hearing, is applicable to
substantially all the rate schedules of IPL, and permits the billing or
crediting of fuel costs above or below the levels included in such rate
schedules.
Under current IURC practice, future fuel adjustment revenues may be
temporarily reduced should actual operating expenses be less than or
income levels be above amounts authorized by the IURC.
Authorized Annual Operating Income--In an IURC order dated May 6,
1992, IPL's maximum authorized annual electric operating income, for
purposes of quarterly earnings tests, was established at approximately
$147 million through July 31, 1992, declining ratably to approximately
$144 million at July 31, 1993. This level will be maintained until an
order has been issued in IPL's pending general electric rate proceeding.
Additionally, through the date of IPL's next general electric rate
order, IPL is required to file upward and downward adjustments in fuel
cost credits and charges on a quarterly basis.
As provided in an order dated December 21, 1992, IPL's authorized
annual steam net operating income is $6.2 million, plus any cumulative
annual underearnings occurring during the five-year period subsequent to
the implementation of the new rate tariffs.
Deferred Fuel Expense--Fuel costs recoverable in subsequent periods
under the fuel adjustment charge provision are deferred.
Allowance For Funds Used During Construction (AFUDC)--In accordance
with the prescribed uniform system of accounts, IPL capitalizes an
allowance for the net cost of funds (interest on borrowed funds and a
reasonable rate on equity funds) used for construction purposes during
the period of construction with a corresponding credit to income. IPL
capitalized amounts using pretax composite rates of 9.5%, 8.0% and 9.5%
during 1994, 1993 and 1992, respectively.
Utility Plant and Depreciation--Utility plant is stated at original
cost as defined for regulatory purposes. The cost of additions to
utility plant and replacements of retirement units of property, as
distinct from renewals of minor items which are charged to maintenance,
are charged to plant accounts. Units of property replaced or abandoned
in the ordinary course of business are retired from the plant accounts
at cost; such amounts plus removal costs, less salvage, are charged to
accumulated depreciation. Depreciation was computed by the straight-
line method based on the functional rates and averaged 3.5% during 1994
and 3.4% during 1993 and 1992. Depreciation expense for 1994 includes
an adjustment to property held for future use of approximately $3.9
million.
Statements of Cash Flows - Cash Equivalents--IPL considers all
highly liquid investments purchased with original maturities of 90 days
or less to be cash equivalents.
Unamortized Petersburg Unit 4 Carrying Charges--IPL has deferred
certain post in-service date carrying charges of its investment in
Petersburg Unit 4 (Unit 4). These carrying charges include both AFUDC
on and depreciation of Unit 4 costs from the April 28, 1986, in-service
date through the August 6, 1986, IURC rate order date in which IPL's
investment in Unit 4 was included in rate base. Subsequent to August 6,
1986, IPL has capitalized interest on the AFUDC portion of these
deferred carrying charges. In addition, IPL has capitalized $8.1
million of additional allowance for earnings on shareholders' investment
for rate-making purposes but not for financial reporting purposes. As
provided in the rate order, the deferred carrying charges are included
in IPL's currently pending electric rate case.
Unamortized Redemption Premiums and Expenses on Debt and Preferred
Stock--In accordance with regulatory treatment, IPL defers nonsinking
fund debt redemption premiums and expenses, and amortizes such costs
over the life of the original debt, or, in the case of preferred stock
redemption premiums, over 20 years.
Income Taxes--Deferred taxes are provided for all significant
temporary differences between book and taxable income. Such differences
include the use of accelerated depreciation methods for tax purposes,
the use of different book and tax depreciable lives, rates and in-
service dates, and the accelerated tax amortization of pollution control
facilities.
Investment tax credits which reduced federal income taxes in the
years they arose have been deferred and are being amortized to income
over the useful lives of the properties in accordance with regulatory
treatment.
Effective January 1, 1993, IPL adopted Statement of Financial
Accounting Standards (SFAS) No. 109, "Accounting for Income Taxes" (SFAS
109), on a prospective basis. This statement requires the current
recognition of income tax expense for (a) the amount of income taxes
payable or refundable for the current year, and (b) for deferred tax
liabilities and assets for the future tax consequences of events that
have been recognized in IPL's financial statements or income tax
returns. The effects of income taxes are measured based on enacted laws
and rates. The adjustments required by SFAS 109 were recorded to
deferred tax balance sheet accounts, with substantially all of the
offsetting adjustments to regulatory assets and liabilities. The
adoption of this standard did not have a material impact on IPL's cash
flows or due to the effect of rate regulation on the results of
operations.
Employee Benefit Plans--Substantially all employees of IPL are
covered by a noncontributory, defined benefit pension plan (the Plan)
which is funded through two trusts. Additionally, a select group of
management employees of IPL are covered under a funded supplemental
retirement plan. Collectively, these two plans are referred to as
Plans. Benefits are based on each individual employee's years of
service and compensation. IPL's funding policy is to contribute
annually not less than the minimum required by applicable law, nor more
than the maximum amount which can be deducted for federal income tax
purposes.
IPL also sponsors the Employees' Thrift Plan of Indianapolis Power
& Light Company (Thrift Plan), a defined contribution plan covering
substantially all employees of IPL. Employees elect to make
contributions to the Thrift Plan based on a percentage of their annual
base compensation. IPL matches each employee's contributions in amounts
up to, but not exceeding 4% of the employee's annual base compensation.
Reclassification--Certain amounts from prior years' financial
statements have been reclassified to conform to the current year
presentation.
2. UTILITY PLANT IN SERVICE:
The original cost of utility plant in service at December 31,
segregated by functional classifications, follows:
<TABLE>
<CAPTION>
1994 1993
- ----------------------------------------------------------------
(In Thousands)
<S> <C> <C>
Production $1,434,041 $1,387,239
Transmission 227,988 218,369
Distribution:
Electric 600,288 551,217
Steam 44,492 42,205
General 108,722 101,652
---------- ----------
Total utility plant in service $2,415,531 $2,300,682
========== ==========
</TABLE>
Substantially all of IPL's property is subject to the lien of the
indentures securing IPL's First Mortgage Bonds.
3. DISCLOSURES ABOUT FAIR VALUE OF FINANCIAL INSTRUMENTS
The following disclosure of the estimated fair value of financial
instruments is made in accordance with the requirements of SFAS No. 107,
"Disclosures about Fair Value of Financial Instruments." The estimated
fair value amounts have been determined by IPL, using available market
information and appropriate valuation methodologies. However,
considerable judgment is required in interpreting market data to develop
the estimates of fair value. Accordingly, the estimates presented
herein are not necessarily indicative of the amounts that IPL could
realize in a current market exchange. The use of different market
assumptions and/or estimation methodologies may have an effect on the
estimated fair value amounts.
Cash, cash equivalents and notes payable--The carrying amount
approximates fair value due to the short maturity of these instruments.
Long-term debt, including current maturities and sinking fund
requirements--Interest rates that are currently available to IPL for
issuance of debt with similar terms and remaining maturities are used to
estimate fair value. At December 31, 1994 and 1993 the carrying amount
of IPL's long-term debt, including current maturities and sinking fund
requirements, and the approximate fair value are as follows:
<TABLE>
<CAPTION>
1994 1993
---------------------------------------------
(In Thousands)
<S> <C> <C>
Carrying amount $654,471 $540,989
Approximate fair value $612,274 $576,621
</TABLE>
4. OTHER REGULATORY ASSETS
At December 31, 1994 and 1993, IPL has deferred certain costs and
expenses which will be included as ordinary, necessary and reasonable
expenses for ratemaking purposes in future rate proceedings as follows:
<TABLE>
<CAPTION>
1994 1993
- -----------------------------------------------------------------
(In Thousands)
<S> <C> <C>
Postretirement benefit costs in excess of
cash payments and amounts capitalized $25,182 $12,893
SFAS 109 21,054 15,091
Demand Side Management Costs 4,504 1,814
Other 2,921 3,156
------- -------
Total $53,661 $32,954
======= =======
</TABLE>
5. CAPITAL STOCK:
Common Stock:
There were no changes in IPL common stock during 1994, 1993 and
1992.
Restrictions on the payment of cash dividends or other
distributions on common stock and on the purchase or redemption of such
shares are contained in the indenture securing IPL's First Mortgage
Bonds. All of the retained earnings at December 31, 1994, were free of
such restrictions.
Cumulative Preferred Stock:
Preferred stock shareholders are entitled to two votes per share,
and if four full quarterly dividends are in default, they are entitled
to elect the smallest number of Directors to constitute a majority.
6. LONG-TERM DEBT:
The 9 5/8% Series due 2012, 10 5/8% Series due 2014, 6.10% Series
due 2016, 5.40% Series due 2017, and 5.50% Series due 2023 were each
issued to the city of Petersburg, Indiana (City) by IPL to secure the
loan of proceeds received from a like amount of tax-exempt Pollution
Control Revenue Bonds issued by the City for the purpose of financing
pollution control facilities at IPL's Petersburg generating station.
On April 13, 1993, IPL issued a First Mortgage Bond, 6.10% Series,
due 2016, in the principal amount of $41.85 million, in connection with
the issuance of the same amount of Pollution Control Refunding Revenue
Bonds by the city of Petersburg, Indiana. The net proceeds, along with
other IPL funds were used to redeem on June 1, 1993, IPL's $19.65
million First Mortgage Bonds, 6.90% Series, due 2006, and IPL's $22.2
million First Mortgage Bonds, 6.60% Series, due 2008, at the prices of
$100 and $101, respectively, plus accrued interest.
On October 14, 1993, IPL issued a First Mortgage Bond, 5.40%
Series, due 2017, in the principal amount of $24.65 million, in
connection with the issuance of the same amount of Pollution Control
Refunding Revenue Bonds by the city of Petersburg, Indiana. The net
proceeds, along with other IPL funds, were used to redeem on November
15, 1993, IPL's $24.65 million First Mortgage Bonds, 5.80% Series, due
2007, at the price of $100 plus accrued interest.
Also, on October 14, 1993, IPL issued a First Mortgage Bond, 5.50%
Series, due 2023, in the principal amount of $30.0 million, in
connection with the issuance of the same amount of Pollution Control
Refunding Revenue Bonds by the city of Petersburg, Indiana. The net
proceeds, along with other IPL funds, were used to redeem on November
15, 1993, IPL's $30.0 million First Mortgage Bonds, 10 1/4% Series, due
2013, at the price of $103 plus accrued interest.
On February 3, 1994, IPL issued First Mortgage Bonds, 6.05% Series,
due 2004, in the principal amount of $80 million. The net proceeds and
other funds were used to redeem on March 1, 1994, IPL's $33.2 million
First Mortgage Bonds, 7.40% Series, due 2002, at a redemption price of
101.79%, and to redeem on March 15, 1994, IPL's $19.75 million First
Mortgage Bonds, 7 1/8% Series, due 1998, at a redemption price of
101.20% and IPL's $25.2 million First Mortgage Bonds, 7.65% Series, due
2003, at a redemption price of 102.11%. Accrued interest was also paid
at the time of redemption.
Also, on February 3, 1994, IPL issued First Mortgage Bonds, 7.05%
Series, due 2024, in the principal amount of $100 million. The net
proceeds were used in part to repay outstanding unsecured promissory
notes and for construction costs.
On August 1, 1994, IPL retired First Mortgage Bond, 4.50% Series,
due August 1, 1994, in the principal amount of $7.5 million.
On December 29, 1994, IPL issued a 30-year unsecured promissory
note which was issued to the city of Petersburg, Indiana, in connection
with the issuance of $20 million of Solid Waste Disposal Revenue Bonds,
due 2024, by the city of Petersburg. This note and the related bonds
provide for a floating interest rate that will bear interest at a tax-
exempt weekly rate. The net proceeds from this issue will provide funds
to pay costs of certain facilities and equipment to be used for solid
waste disposal purposes. At the option of IPL, the bonds can be
converted to First Mortgage Bonds which would bear interest at a fixed
rate.
IPL has a 30-year unsecured promissory note which was issued to the
city of Petersburg, Indiana, in connection with the issuance of $40
million of Pollution Control Refunding Revenue Bonds, due 2021, by the
city of Petersburg. This note and the related bonds provide for a
floating interest rate that approximates tax-exempt Commercial Paper
Rates. The average interest rate on this note was 2.98% for 1994 and
2.40% for 1993. The interest rate at the end of the year was 3.85% for
1994 and 2.39% for 1993. At the option of IPL, the bonds can be
converted to First Mortgage Bonds which would bear interest at a fixed
rate.
IPL has a $60 million long term revolving credit facility which
provides liquidity, if necessary, for the two 30-year unsecured
promissory notes. The revolving credit was unused at December 31, 1994.
Maturities and sinking fund requirements on long-term debt for the
five years subsequent to December 31, 1994, are as follows:
<TABLE>
<CAPTION>
Net Sinking Fund
Maturities Requirements Total
- --------------------------------------------------------------
(In Thousands)
<S> <C> <C> <C>
1995 $ -- $ 350 $ 350
1996 15,000 150 15,150
1997 11,250 -- 11,250
1998 -- -- --
1999 -- -- --
</TABLE>
The Company has filed a Preliminary Official Statement with the
relevant regulatory authorities involving the sale of $40 million
Pollution Control Refunding Bonds by the city of Petersburg and the
issuance by the Company of its First Mortgage Bond in the like amount.
It is anticipated that this transaction will close in early February,
1995. The proceeds will be used to refund the 10 5/8% Series, due
December, 2014.
7. LINES OF CREDIT:
IPL has lines of credit with banks of $100 million at December 31,
1994, to provide loans for interim financing. These lines of credit,
based on separate formal and informal agreements, have expiration dates
ranging from January 31, 1995, to November 30, 1995, and require the
payment of commitment fees. At December 31, 1994, $95 million of these
credit lines were unused. Lines of credit supporting commercial paper
were $21.4 million at December 31, 1994. The weighted average interest
rates on notes payable and commercial paper outstanding were 6.17% and
3.36% at December 31, 1994 and 1993, respectively.
8. INCOME TAXES:
Federal and state income taxes charged to income are as follows:
<TABLE>
<CAPTION>
1994 1993 1992
- ---------------------------------------------------------------------------
(In Thousands)
<S> <C> <C> <C>
Operating Expenses:
Current income taxes:
Federal $45,919 $52,321 $48,504
State 6,919 7,761 7,500
------- ------- -------
Total current taxes 52,838 60,082 56,004
------- ------- -------
Deferred income taxes, net--federal and state:
Excess of tax depreciation over book
depreciation 6,615 7,109 5,254
Early retirement of bonds 271 592 1,965
Allowance for borrowed funds used during
construction (net of capitalized interest
for tax purposes) (1,187) (1,214) (1,050)
Amortization of deferred return - rate
phase-in plan (debt portion) - - (676)
Unbilled revenues 609 (1,768) 436
Accrued pension expense (1,651) (1,865) (1,965)
Miscellaneous 1,316 204 (890)
------- ------- -------
Total deferred taxes 5,973 3,058 3,074
------- ------- -------
Net amortization of investment credit (3,268) (3,268) (3,459)
------- ------- -------
Total charge to operating expenses 55,543 59,872 55,619
Net credit to other income and deductions (823) (599) (1,143)
------- ------- -------
Total federal and state income tax provisions $54,720 $59,273 $54,476
======= ======= =======
</TABLE>
The provision for federal income taxes (including net investment
tax credit adjustments) is less than the amount computed by applying the
statutory tax rate to pretax income. The reasons for the difference,
stated as a percentage of pretax income, are as follows:
<TABLE>
<CAPTION>
1994 1993 1992
- -----------------------------------------------------------------
<S> <C> <C> <C>
Federal statutory tax rate 35.0% 35.0% 34.0%
Effect of state income taxes (1.8) (1.8) (1.9)
Amortization of investment tax credits (2.1) (2.0) (2.3)
Other - net (1.6) 0.1 1.5
---- ---- ----
Effective tax rate 29.5% 31.3% 31.3%
==== ==== ====
</TABLE>
The significant items comprising IPL's net deferred tax liability
recognized in the balance sheets as of December 31, 1994 and 1993 are as
follows:
<TABLE>
<CAPTION>
1994 1993
- -------------------------------------------------------------------
(In Thousands)
<S> <C> <C>
Deferred tax liabilities:
Relating to utility property $349,461 $335,824
Early retirement of bonds 7,697 7,377
Other 4,414 1,626
-------- --------
Total deferred tax liabilities 361,572 344,827
-------- --------
Deferred tax assets:
Unbilled revenue 9,538 10,148
Pension 10,865 9,033
Investment tax credit 32,846 34,842
Other 26,261 20,622
-------- --------
Total deferred tax assets 79,510 74,645
-------- --------
Net deferred tax liability $282,062 $270,182
======== ========
</TABLE>
9. RATE MATTERS
Electric Rate Case
In the retail electric rate case now pending before the IURC, a
prehearing conference was held on June 8, 1994, and an order was issued
July 20, 1994, establishing a test year ending June 30, 1994. IPL filed
its case-in-chief on October 11, 1994. The IURC has scheduled hearings
on IPL's request to begin on February 7, 1995.
Environmental Compliance Plan
On August 18, 1993, IPL obtained an Order from the IURC approving
its Environmental Compliance Plan, together with the costs and expenses
associated therewith, which provides for the installation of sulfur
dioxide and nitrogen oxide emissions abatement equipment and the
installation of continuous emission monitoring systems to meet the
requirements of both Phase I and Phase II of the Federal Clean Air Act
Amendments of 1990 (the Act). The order provides for the deferral of
net gains and losses resulting from any sale of emission allowances.
The order further provides for the amortization of such deferrals, as an
expense reduction or as an expense, to be included in the ordinary,
necessary and reasonable expenses for ratemaking purposes, on a basis to
be determined in a future general electric rate proceeding.
Steam Rate Order
By an order dated January 13, 1993, the IURC authorized IPL to
increase its steam system rates and charges over a six-year period.
Accordingly, IPL implemented new steam tariffs designed to produce
estimated additional annual steam operating revenues as follows:
<TABLE>
<CAPTION>
Additional Cumulative
Annual Annual
Year Revenues Revenues
---- ---------- ----------
<S> <C> <C>
January 13, 1993 $1,932,000 $1,932,000
January 13, 1994 2,051,000 3,983,000
January 13, 1995 1,552,000 5,535,000
January 13, 1996 1,625,000 7,160,000
January 13, 1997 2,384,000 9,544,000
January 13, 1998 370,000 9,914,000
</TABLE>
Demand Side Management Program
On September 8, 1993, IPL obtained an Order from the IURC approving
a Stipulation of Settlement Agreement between IPL, the Office of Utility
Consumer Counselor, Citizens Action Coalition of Indiana, Inc., an
industrial group, the Trustees of Indiana University and the Indiana
Alliance for Fair Competition relating to the Company's Demand Side
Management Program (DSM). The order provides for the deferral and
subsequent recognition as ordinary, necessary and reasonable expenses
for ratemaking purposes of certain approved DSM costs. The order also
provides for the recording of a return on deferred costs until
recognized in the future for ratemaking purposes.
10. EMPLOYEE BENEFIT PLANS AND OTHER POSTRETIREMENT BENEFITS:
IPL's contributions to the Thrift Plan, net of amounts allocated to
related parties were $3.3 million, $3.1 million and $3.1 million in
1994, 1993 and 1992, respectively.
Net pension cost for the Plan including amounts charged to
construction for 1994, 1993 and 1992 are comprised of the following
components:
<TABLE>
<CAPTION>
1994 1993 1992
- -----------------------------------------------------------------------------
(In Thousands)
<S> <C> <C> <C>
Service cost--benefits earned during the period $ 7,832 $ 6,355 $5,563
Interest cost on projected benefit obligation 15,358 14,192 13,739
Actual return on plan assets 10,366 (40,045) (18,865)
Net amortization and deferral (27,297) 25,689 5,366
------- ------- -------
Net periodic pension cost 6,259 6,191 5,803
Less amount allocated to related parties 79 87 71
------- ------- -------
IPL net periodic pension cost $ 6,180 $ 6,104 $ 5,732
======= ======= =======
</TABLE>
A summary of the Plans' funding status, and the amount recognized
in the balance sheets at December 31, 1994 and 1993, follows:
<TABLE>
<CAPTION>
1994 1993
- ---------------------------------------------------------------------------
(In Thousands)
<S> <C> <C>
Actuarial present value of benefit obligations:
Vested benefit obligation $(123,306) $(128,449)
Nonvested benefit obligation (26,394) (28,532)
--------- ---------
Accumulated benefit obligation $(149,700) $(156,981)
========= =========
Projected benefit obligation $(201,345) $(224,037)
Plan assets at fair value 199,522 218,312
--------- ---------
Funded status--plan assets less than projected
benefit obligation (1,823) (5,725)
Unrecognized net gain from past experience different
from that assumed (31,058) (22,922)
Unrecognized past service costs 21,188 22,932
Unrecognized net asset at January 1, 1987 being
amortized over an original life of 18.9 years (15,410) (16,825)
--------- ---------
Net accrued pension costs included in current
liabilities at December 31 $ (27,103) $ (22,540)
========= =========
</TABLE>
Approximately 19.5% of the Plans' assets were in equity securities,
with the remainder in fixed income securities.
IPL also provides certain postretirement health care and life
insurance benefits for employees who retire from active service on or
after attaining age 55 and have rendered at least 10 years of service.
On January 1, 1993, IPL adopted the provisions of SFAS No. 106,
"Employers' Accounting for Postretirement Benefits Other than Pensions"
(SFAS 106). Generally, SFAS 106 requires the use of an accrual basis
accounting method for determining annual costs of postretirement
benefits. The January 1, 1993, transition obligation of $122.4 million
is being amortized over a 20 year period. Prior to 1993, the cost of
such benefits was recognized when incurred and amounted to $3.5 million
in 1992.
Net postretirement benefit cost, including amounts charged to
construction for 1994 and 1993 is comprised of the following components:
<TABLE>
<CAPTION>
1994 1993
- --------------------------------------------------------------------------------
(In Thousands)
<S> <C> <C>
Service cost -- benefits earned during the period $ 5,051 $4,760
Interest cost on accumulated postretirement benefit obligation 11,052 10,792
Actual return on plan assets (435) (297)
Net amortization and deferral 5,740 5,732
------- -------
Net periodic postretirement benefit cost $21,408 $20,987
======= =======
</TABLE>
A summary of the retiree health care and life insurance plan's
funding status, and the amount recognized in the balance sheets at
December 31, 1994 and 1993 follows:
<TABLE>
<CAPTION>
1994 1993
- ---------------------------------------------------------------------------------------------------
(In Thousands)
<S> <C> <C>
Actuarial present value of accumulated postretirement benefit obligation:
Retirees $ (55,462) $ (60,110)
Fully eligible active plan participants (19,531) (21,344)
Other active plan participants (58,573) (73,872)
--------- ---------
Total (133,566) (155,326)
Plan assets at fair value 10,570 10,135
--------- ---------
Funded status--accumulated postretirement benefit obligation in excess
of plan assets (122,996) (145,191)
Unrecognized net gain from past experience different from that assumed (21,606) 11,322
Unrecognized net obligation at January 1, 1993 being amortized over
an original life of 20 years 110,085 116,201
--------- ---------
Net accrued postretirement benefit cost included in deferred liabilities at
December 31 $ (34,517) $ (17,668)
========= =========
</TABLE>
IPL is expensing its nonconstruction related SFAS 106 costs
associated with its steam business. The SFAS 106 costs, net of amounts
paid and capitalized for construction, associated with IPL's electric
business is being deferred as a regulatory asset on the balance sheets,
as authorized by an order of the IURC on December 30, 1992, which
provided for deferral of SFAS 106 costs in excess of such costs
determined on a cash basis. A request for inclusion of these costs as
ordinary, necessary and reasonable expenses for ratemaking purposes has
been made in IPL's pending general electric rate petition.
The assumed health care cost trend rate used in measuring the
accumulated postretirement benefit obligation is 11.7% for 1995,
gradually declining to 5.0% in 2003. A 1% increase in the assumed
health care cost trend rate for each year would increase the accumulated
postretirement benefit obligation as of December 31, 1994, by
approximately $20.4 million and the combined service cost and interest
cost for 1994 by approximately $2.9 million.
Plan assets consist of the cash surrender value of life insurance
policies on certain retired employees.
Assumptions used in determining the information above were:
<TABLE>
<CAPTION>
1994 1993 1992
- ------------------------------------------------------------------------------
<S> <C> <C> <C>
Discount rate - pension plans 8.0% 7.0% 7.5%
Discount rate - postretirement benefits 8.0% 7.0% -
Rate of increase in future compensation levels 6.1% 6.1% 6.1%
Expected long-term rate of return on assets - pension plans 8.0% 8.0% 8.0%
</TABLE>
On August 30, 1994, IPALCO's Board of Directors adopted a
Voluntary Employee Beneficiary Association (VEBA) Trust Agreement for
the funding of postretirement health and life insurance benefits for
retirees and their eligible dependents and beneficiaries. Annual
funding is discretionary and is based on the projected cost over time of
benefits to be provided to covered persons consistent with acceptable
actuarial methods. To the extent these postretirement benefits are
funded, the benefits will not be shown as a liability on IPL's financial
statements. The VEBA Trust Agreement provides for full funding of IPL's
accumulated postretirement benefit obligation in the event of certain
change of control transactions.
11. COMMITMENTS AND CONTINGENCIES:
In 1995, IPL anticipates the cost of its construction program to be
approximately $214 million.
IPL will comply with the provisions of the Act through the
installation of SO2 scrubbers and NOx facilities. The cost of complying
with the Act from 1995 through 1997, including AFUDC, is estimated to be
approximately $142 million, of which $125 million is anticipated in
1995. During 1994, 1993, and 1992, expenditures for compliance with the
Act were $59.4 million, $13.7 million, and $20.0 million, respectively.
IPL has a five-year firm power purchase agreement with Indiana
Michigan Power Company (IMP) for 100 megawatts (MW) of capacity
effective April 1992, with the purchase of an additional 100 MW (for a
total of 200 MW) beginning in April 1993. The agreement provides for
monthly capacity payments by IPL of $.6 million from April 1992 through
March 1993, increasing to a monthly amount of $1.2 million which began
in April 1993 and continue through March 31, 1997. The agreement
further provides that IPL can elect to extend purchases through December
31, 1997, and subsequently through November 30, 1999, with capacity
payments of $1.2 million per month and $1.55 million per month,
respectively. IPL can terminate the agreement, should the ability to
include future demand charges in ordinary, necessary and reasonable
expenses for ratemaking purposes be disallowed. Capacity payments
during 1994, 1993 and 1992 under this agreement totaled $14.4 million,
$12.6 million and $5.4 million, respectively.
IPL is involved in litigation and environmental claims arising in
the normal course of business. While the results of such litigation
cannot be predicted with certainty, management, based upon advice of
counsel, believes that the final outcome will not have a material
adverse effect on the financial position and results of operations.
With respect to environmental issues, IPL has ongoing discussions with
various regulatory authorities, and continues to believe that IPL is in
compliance with its various permits, but if IPL's position is found to
be erroneous, they could be subject to fines.
12. QUARTERLY RESULTS (UNAUDITED):
Operating results for the years ended December 31, 1994 and 1993 by
quarter, are as follows (in thousands):
<TABLE>
<CAPTION>
1994
- -----------------------------------------------------------------------
March 31 June 30 September 30 December 31
-------- ------- ------------ -----------
<S> <C> <C> <C> <C>
Operating revenues $181,178 $161,137 $183,666 $160,095
Operating income 41,520 29,440 42,832 29,518
Net income 31,563 19,202 32,640 20,418
<CAPTION>
1993
- -----------------------------------------------------------------------
March 31 June 30 September 30 December 31
-------- ------- ------------ -----------
<S> <C> <C> <C> <C>
Operating revenues $169,042 $153,127 $183,264 $158,870
Operating income 40,068 27,354 44,520 30,426
Net income 30,038 17,551 34,331 20,846
</TABLE>
The quarterly figures reflect seasonal and weather-related
fluctuations which are normal to IPL's operations. Colder weather was
experienced in the first quarter of 1994 and warmer weather was
experienced in the second quarter of 1994, while weather conditions in
1993 reflected near normal conditions. In addition, during the third
quarter of 1994, IPL expensed approximately $3.1 million of property
held for future use.
