SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 11-K
ANNUAL REPORT
PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 1996
MDU RESOURCES GROUP, INC.
TAX DEFERRED COMPENSATION SAVINGS PLAN
MDU RESOURCES GROUP, INC.
400 NORTH FOURTH STREET
BISMARCK, NORTH DAKOTA 58501
CONTENTS
Required Information
Financial Statements:
Statements of Financial Condition -- December 31,
1996 and 1995
Statements of Income and Changes in Participants'
Equity -- Years ended December 31, 1996, 1995
and 1994
Notes to Financial Statements
Schedules -- Schedule I has been omitted because
the required information is shown in such
financial statements or the notes or supplemental
schedules thereto.
Schedule II -- Allocation of Plan Assets and
Liabilities to Investment Programs
Schedule III -- Allocation of Plan Income and
Changes in Plan Equity to Investment Programs
Report of Independent Public Accountants
Signature page
Exhibit:
Consent of Independent Public Accountants
MDU RESOURCES GROUP, INC.
TAX DEFERRED COMPENSATION SAVINGS PLAN
STATEMENTS OF FINANCIAL CONDITION
December 31,
1996 1995
Assets:
Investments -- (Schedule II)
MDU Resources Group, Inc. common
stock
(1996 -- 2,838,640 shares,
cost $43,045,573;
1995 -- 2,713,385 shares,
cost $39,410,816) $65,289,050 $54,131,271
Other 8,143,804 7,816,138
Cash 2,690,638 3
Contributions receivable --
Employers --- 100,000
Employees --- ---
Dividends and interest receivable 789,777 746,432
$76,913,269 $62,793,844
Participants' equity:
Distributions due terminated
participants $ 1,768,833 $ 1,432,240
Active participants' equity 75,144,436 61,361,604
$76,913,269 $62,793,844
The accompanying notes are an integral part
of these statements.
MDU RESOURCES GROUP, INC.
TAX DEFERRED COMPENSATION SAVINGS PLAN
STATEMENTS OF INCOME AND CHANGES IN PARTICIPANTS' EQUITY
Years ended December 31,
1996 1995 1994
Investment income: (Schedule III)
Dividends $ 3,325,827 $ 3,085,049 $ 2,791,695
Interest 33,247 21,542 24,039
Capital gains 25,681 10,645 12,091
Other (108,279) (19,297) (183)
Realized gain on
distributions 1,369,749 1,238,330 996,155
Unrealized appreciation
(depreciation) on
investments 8,518,996 4,817,153 (8,370,711)
13,165,221 9,153,422 (4,546,914)
Contributions: (Schedule III)
Employers 1,170,200 1,236,820 1,081,356
Employees 3,332,996 2,921,030 2,755,294
Employee rollover 15,179 19,784 438,715
Total contributions 4,518,375 4,177,634 4,275,365
Distributions to terminated
participants (4,164,626) (4,694,993) (3,187,951)
Net transfers from Tax
Deferred Compensation
Savings Plan for
Collective Bargaining
Unit Employees 600,455 678,285 168,444
Increase (decrease) in
participants' equity 14,119,425 9,314,348 (3,291,056)
Participants' equity at
beginning of year 62,793,844 52,611,360 55,902,416
Merger of Profit Sharing
feature (Note 1) --- 868,136 ---
62,793,844 53,479,496 55,902,416
Participants' equity at
end of year $76,913,269 $62,793,844 $52,611,360
The accompanying notes are an integral part
of these statements.
1. Description of the Plan
The MDU Resources Group, Inc. Tax Deferred Compensation Savings
Plan (the Plan) was adopted on August 4, 1983, by the Board of
Directors of MDU Resources Group, Inc. (the Company) to provide a
means for deferred savings and investment by eligible employees
and to afford additional security for their retirement. The Plan
is a defined contribution plan established effective January 1,
1984. The Company and any of its direct or indirect subsidiaries
who choose to participate in the Plan are the Employers.
Effective January 1, 1988 (1988 Effective Date), the Plan was
amended and restated to reflect the merger and transfer of
eligible employees' accounts of the MDU Resources Group, Inc.
Employee Stock Ownership Plan (ESOP) into the Plan. Effective
January 1, 1995 (1995 Effective Date), the Plan was amended to
reflect the merger and transfer of eligible employees' accounts of
the Anchorage Sand and Gravel Company, Inc. (AS&G) Profit
Sharing/401(k) Plan into the Plan. The fiscal year of the Plan is
the calendar year.
The Board of Directors of the Company may amend or modify the
Plan, and the Boards of Directors of the Employers may, at any
time, terminate the Plan with respect to the respective Employer.
The Plan is administered for the Company by a five-member
committee (the Committee) appointed by the Chief Executive Officer
of the Company.
Administrative expenses of the Plan are paid by the Employers,
however, fees or commissions associated with each of the
investment options are paid primarily by participants as a
deduction from the amount invested or an offset to investment
earnings.
The Plan contains two parts: 1) The Deferred Savings feature
which is the part of the Plan related to an eligible employee's
ability to defer a portion of the employee's current compensation
into a tax-free trust, and 2) The ESOP feature which is the part
of the Plan related to participation in the ESOP, as merged into
the Plan as of the 1988 Effective Date.
Deferred Savings
Any employee who is at least 18 years of age, who has completed
at least one year of service with a minimum of 1,000 hours worked
and who is not a collective bargaining unit employee is eligible
to participate in the Plan. An eligible employee may elect to
participate in the Plan on January 1, April 1, July 1 or October 1
following completion of one year of service and by filing a
written election with the Committee to have savings contributions
made on the employee's behalf. A former participant or eligible
employee who is reemployed shall again become eligible to become a
participant as defined in the respective Employer's summary plan
description.
Upon becoming a participant, and in January, April, July and
October of each subsequent year, each participant may, by filing a
written election with the Committee or via the Benefits Advantage
Hotline, authorize the participant's Employer to contribute to the
Plan on such participant's behalf by payroll reduction. The
Benefits Advantage Hotline is operated by Norwest Bank Minnesota,
N.A. (Trustee). The Plan allows contributions by participants
varying from one percent through 15 percent (10 percent through
December 31, 1995), in one percent increments, of eligible
compensation for each pay period. In addition, the Plan accepts
rollover contributions from other qualified retirement plans or an
Individual Retirement Account (IRA) that only holds assets
distributed from a qualified plan as adjusted for earnings, losses
and gains attributable thereto. Such savings contributions on
behalf of a participant are credited to the participant's Rollover
Account. An election is made by each participant to allocate
contributions to any or all of the five available investment
options. The investment election made must be designated in 10
percent increments of the total amount contributed by the
participant to be invested in common stock of the Company, an
equity indexed mutual fund, a bond market indexed fund, a balanced
fund or a short-term investment fund. Such savings contributions
reduce, on a dollar-for-dollar basis, the participant's taxable
earnings in the year in which the savings contributions are made.
Eligible compensation is defined as the employee's total
compensation (not in excess of $150,000, as adjusted) from the
Employer, unreduced by any savings contributions of the eligible
employee to the Plan, and any amount contributed by the Employer
pursuant to a salary reduction agreement and which is not
includible in the gross income of an employee, excluding other
contributions to the Plan, contributions to other employee benefit
plans and certain additional items of compensation which do not
constitute direct earnings.
A participant may authorize suspension of such participant's
savings contributions to the Plan for a minimum period of three
months by filing a written election with the Committee or via the
Benefits Advantage Hotline. Such suspension of savings
contributions is effective no later than the first pay period
coincident with or next following 30 days after the election to
suspend is received by the Trustee or the Committee. Suspended
savings contributions may not be made up by savings contributions
at a later time.
Each participant's Employer makes a matching contribution,
equal to a percentage of such participant's monthly savings
contributions as provided under the Plan, which is credited to
such participant's Matching Contribution Account. All matching
contributions are invested in common stock of the Company.
A participant's interest in a Savings Contribution Account or a
Matching Contribution Account is at all times fully vested and
nonforfeitable.
The Plan limits the elective deferral contribution for each
participant to the annual dollar limit as designated in Section
402(g) of the Internal Revenue Code (the Code) for the calendar
year, as adjusted. For each participant, contributions (other
than rollovers) credited to an account in any plan year, when
aggregated with contributions under all other qualified plans
maintained by the Employers, cannot be greater than the maximum
contribution permitted by Section 415 of the Code. The deduction
for contributions to the Plan, when taken together with all other
contributions made by the Employer to other qualified retirement
plans, cannot exceed the maximum amount deductible under Section
404 of the Code. The Plan also limits the aggregate savings
contributions which may be made on behalf of highly compensated
employees.
Once each month, the Employers remit all authorized
contributions made by the participants to the Trustee to be held
in trust and invested for the respective accounts of the
participants, pursuant to the terms of the Trust Agreement
executed with the Trustee effective January 1, 1994.
Contributions for common stock, including the Employers' matching
contribution, are used by the Trustee to purchase shares of MDU
Resources Group, Inc. common stock (MDU stock) directly in the
open market. All such market purchases may be made at such prices
as the Trustee may determine in its sole and absolute discretion.
Under the terms of the Trust Agreement, the Trustee may also
purchase shares of authorized but unissued common stock directly
from the Company if the Company chooses to issue new stock. The
funds contributed to the equity indexed mutual fund are invested
in the Vanguard Index-500 Portfolio (Vanguard), which trades in
the 500 common stocks listed on the Standard & Poor's 500
Composite Stock Price Index. The funds contributed to the bond
market indexed fund are invested through Mellon Bank in the
Dreyfus Bond Market Index Fund (Mellon), which invests in
corporate bonds which attempt to match the Lehman Brothers
Government/Corporate Bond Index. The funds contributed to the
balanced fund are invested in the Fidelity Balanced Fund
(Fidelity), which invests in high-yielding securities including
common stocks, preferred stocks and bonds. The funds contributed
to the short-term investment fund (STIF) are invested in short-
term, high-quality, money market investments. Effective January
1, 1997, Fidelity was replaced with the Dodge & Cox Balanced Fund,
which invests in well-established companies stocks and bonds. In
addition, Mellon was replaced on January 1, 1997, with the
Vanguard Total Bond Market Index Fund, which invests in corporate
bonds which attempt to match the Lehman Brothers Aggregate Bond
Index.
Any dividends, interest, gains, losses or other distributions
on the above mentioned investments and short-term investment
income allocated to a participant's accounts are reinvested in the
appropriate investment medium, which is credited to the
participant's accounts. As amounts are allocated to each
participant's accounts, they become fully vested.
The amount credited to a participant's Savings Contribution
Account and Matching Contribution Account shall become payable to
the participant or the participant's beneficiary/beneficiaries, as
applicable (see tax rules related to rollover options), upon
death, retirement, disability, or other termination of employment
with the Employers. The distribution of such amounts will be in
accordance with the Plan, based on the method of payment elected
by the participant or designated beneficiary/beneficiaries.
Amounts credited to such accounts will be paid as soon as
practicable after such amounts are ascertained; provided that such
payment shall not be made prior to the participant's attainment of
age 65 without the written consent of the participant if the value
of such accounts exceeds $3,500.
Upon written application to the Committee, a participant may
make withdrawals from such participant's Savings Contribution
Account or Matching Contribution Account under certain conditions.
On the 1995 Effective Date, the 401(k) feature of the AS&G
Profit Sharing/401(k) Plan was merged into the Deferred Savings
feature of the Plan with the Profit Sharing feature being merged
into the Plan as a separate feature. On September 30, 1996, the
assets of the Profit Sharing feature were liquidated and
transferred to the five available investment options of the
Deferred Savings feature as directed by the AS&G participants.
Participation in the Profit Sharing feature of the Plan is
limited to participants who are non-bargaining employees of AS&G.
On an annual basis, AS&G may contribute a discretionary amount to
the non-highly compensated AS&G employees out of its current or
accumulated net profit, as defined in the summary plan
description.
ESOP
Participation in the ESOP feature of the Plan is limited to
participants in the ESOP as of the 1988 Effective Date or the date
as of which an ESOP Account is established under the Plan,
whichever is later.
As of the 1988 Effective Date, ESOP Accounts have been
suspended and no additional contributions shall be made by the
Company to such accounts, other than to reflect dividends or other
earnings, unless and to the extent the Company in its sole
discretion shall make additional contributions.
A participant's interest in an ESOP Account is at all times
fully vested and nonforfeitable.
Distributions are consistent with the Deferred Savings feature
previously mentioned.
Each participant with an ESOP Account, who has attained age 55
and who has completed at least 10 years of participation under the
ESOP, the Plan or both is entitled to elect the distribution of a
percentage of the value of the participant's ESOP Account
attributable to common stock acquired under the ESOP or ESOP
feature after December 31, 1986.
2. Summary of significant accounting policies
Investment valuation -
Investments held by the Plan are carried at market value.
Market value for Mellon is determined from several independent
pricing sources. Market value for the STIF approximates cost.
Market value of real estate is determined using a Letter of
Opinion from a real estate broker. Market value of the Plan's
other investments is based on published market quotations.
Contributions --
Employer and employee contributions are recorded by the Plan
when received or determined to be receivable. Employee
contributions are accumulated by the Employers through payroll
reductions.
Other --
Securities transactions are recorded on a trade date basis.
Dividend income is recorded on the ex-dividend date. Interest
income is recorded as earned.
3. Investments
The cost basis for distributions from the Plan is calculated
using the average cost per participant. Information concerning
distributions to terminated participants and other participants
meeting certain conditions of the Plan during 1996, 1995 and 1994
was as follows:
<TABLE>
<CAPTION>
Deferred Savings ESOP
1996 1995 1994 1996 1995 1994
<S> <C> <C> <C> <C> <C> <C>
MDU Stock:
Number
of
shares 123,334 116,987 66,558 61,030 48,350 34,169
Market
value $2,599,731 $2,986,213 $1,995,339 $1,283,160 $1,248,156 $1,027,066
Average
cost $1,969,443 $2,361,202 $1,480,531 $715,030 $728,333 $553,429
Cash $264,405 $337,286 $152,158 $16,718 $17,582 $13,388
</TABLE>
Cash distributions made in 1996 and 1995 from the Profit Sharing
feature were $612 and $105,756, respectively.
The net changes in unrealized appreciation of Plan investments
during 1996, 1995 and 1994 were as follows:
<TABLE>
<CAPTION>
Deferred Savings ESOP
1996 1995 1994 1996 1995 1994
<S> <C> <C> <C> <C> <C> <C>
Unrealized
appreciation
at 01/01 $ 9,807,996 $5,865,526 $11,586,491 $6,305,525 $5,443,782 $ 8,093,528
Change
during
the year 6,555,396 3,942,470 (5,720,965) 1,963,600 861,743 (2,649,746)
Unrealized
appreciation
at 12/31 $16,363,392 $9,807,996 $ 5,865,526 $8,269,125 $6,305,525 $ 5,443,782
</TABLE>
Profit
Sharing
1995
Unrealized
appreciation
at 01/01 $(46,874)
Change
during
the year 12,940
Unrealized
appreciation
at 12/31 $(33,934)
Due to the transfer of assets for the Profit Sharing feature in
1996 to the Deferred Savings feature, 1996 information is not
presented for the Profit Sharing feature but has been included with
the Deferred Savings feature above.
4. Federal income taxes
The Internal Revenue Service (IRS) has informed the Company that
the Plan, as amended through August 16, 1994, is qualified under
Section 1.401-1 of the Income Tax Regulations. The Company intends
to file subsequent plan amendments with the IRS to receive final
determination. The Company believes the Plan, as amended, will
remain exempt from federal income tax under Section 501(a) of the
Code. Contributions under the Plan and earnings of the trust will
not be taxable to the participants until distributed. Except as
stated below, any distribution made to a participant is taxable as
ordinary income in the year of distribution.
Under current law, the amount taxable as ordinary income may be
eligible for a special five-year averaging method of taxation
(participants who reached age 50 before 1986 may be eligible for
ten-year averaging) if the participant has participated in the Plan
for five years prior to the year in which the distribution is
received. Any net unrealized appreciation at the time of
distribution will be treated as long-term capital gain upon the
subsequent sale of the common stock (unless the participant has
previously elected to include this amount as income in the year of
distribution) and any further appreciation subsequent to the date
of distribution will be treated as long-term or short-term capital
gain depending on the participant's holding period.
Distributions from the Plan may qualify under the Code as
"eligible rollover distributions." An eligible rollover
distribution is a distribution paid directly from the Plan to an
IRA or another employer plan that accepts rollovers or paid to the
participant and rolled over by the participant within 60 days to a
qualifying IRA or another employer qualified plan. If a
participant chooses either of these options, such participant is
not taxed on the amount rolled over until the participant later
receives a distribution from the IRA or the employer plan.
The foregoing covers only the general federal income tax aspects
of Plan participation and distributions.
SUPPLEMENTAL
SCHEDULES
<TABLE>
ALLOCATION OF PLAN ASSETS AND
LIABILITIES TO INVESTMENT PROGRAMS
December 31, 1996
<CAPTION>
Total
ESOP Deferred Savings Deferred Profit
MDU Stock MDU Stock Vanguard Mellon Fidelity STIF Savings Sharing Total
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Assets:
Investments --
Participants 700 1,102 719 320 300 68
Number of
shares/units 748,941 2,089,699 106,804 652 --- 750,577 2,947,732 --- 3,696,673
Cost $ 8,956,510 $34,089,046 $4,997,832 $ 6,371 $ --- $750,578 $39,843,827 $ --- $48,800,337
Market value $17,225,635 $48,063,415 $7,386,852 $ 6,375 $ --- $750,577 $56,207,219 $ --- $73,432,854
Cash --- 19 --- 1,249,209 1,441,409 1 2,690,638 --- 2,690,638
Contributions
receivable --
Employers --- --- --- --- --- --- --- --- ---
Employees --- --- --- --- --- --- --- --- ---
Dividends and
interest
receivable 207,830 580,134 15 1 8 1,789 581,947 --- 789,777
$17,433,465 $48,643,568 $7,386,867 $1,255,585 $1,441,417 $752,367 $59,479,804 $ --- $76,913,269
Participants'
equity:
Distributions
due terminated
participants $ 481,177 $ 1,135,606 $ 97,219 $ 47,131 $ 6,894 $ 806 $ 1,287,656 $ --- $ 1,768,833
Active
participants'
equity 16,952,288 47,507,962 7,289,648 1,208,454 1,434,523 751,561 58,192,148 --- 75,144,436
$17,433,465 $48,643,568 $7,386,867 $1,255,585 $1,441,417 $752,367 $59,479,804 $ --- $76,913,269
The accompanying notes are an integral part
of this schedule.
</TABLE>
<TABLE>
ALLOCATION OF PLAN ASSETS AND
LIABILITIES TO INVESTMENT PROGRAMS
December 31, 1995
<CAPTION>
Total
ESOP Deferred Savings Deferred Profit
MDU Stock MDU Stock Vanguard Mellon Fidelity STIF Savings Sharing Total
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Assets:
Investments --
Participants 751 1,096 664 321 264 59 36
Number of
shares/units 748,388 1,964,997 82,876 107,263 56,860 245,299 2,457,295 * 3,205,683
Cost $ 8,568,740 $30,842,075 $3,548,880 $1,030,884 $752,153 $245,300 $36,419,292 $879,790 $45,867,822
Market value $14,874,265 $39,257,006 $4,832,501 $1,100,847 $791,635 $245,299 $46,227,288 $845,856 $61,947,409
Cash 1 --- 1 --- --- 1 2 --- 3
Contributions
receivable --
Employers --- ---- --- --- --- --- --- 100,000 100,000
Employees --- --- --- --- --- --- --- --- ---
Dividends and
interest
receivable 203,936 535,670 29 5,555 17 1,207 542,478 18 746,432
$15,078,202 $39,792,676 $4,832,531 $1,106,402 $791,652 $246,507 $46,769,768 $945,874 $62,793,844
Participants'
equity:
Distributions
due terminated
participants $ 463,796 $ 893,892 $ 45,729 $ 18,191 $ 5,682 $ 4,950 $ 968,444 $ --- $ 1,432,240
Active
participants'
equity 14,614,406 38,898,784 4,786,802 1,088,211 785,970 241,557 45,801,324 945,874 61,361,604
$15,078,202 $39,792,676 $4,832,531 $1,106,402 $791,652 $246,507 $46,769,768 $945,874 $62,793,844
*Due to the various type of investments held, which include real estate, stocks, bonds and other securities, the number of
shares/units is not presented because it does not correlate with cost or market value.
The accompanying notes are an integral part
of this schedule.
</TABLE>
<TABLE>
ALLOCATION OF PLAN INCOME AND CHANGES
IN PLAN EQUITY TO INVESTMENT PROGRAMS
Year ended December 31, 1996
<CAPTION>
Total
ESOP Deferred Savings Deferred Profit
MDU Stock MDU Stock Vanguard Mellon Fidelity STIF Savings Sharing Total
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Investment income:
Dividends $ 832,432 $ 2,240,465 $ 127,247 $ 68,953 $ 52,482 $ --- $ 2,489,147 $ 4,248 $ 3,325,827
Interest 4 3,911 560 386 211 16,229 21,297 11,946 33,247
Capital gains --- --- 25,681 --- --- --- 25,681 --- 25,681
Other --- --- --- --- --- (760) (760) (107,519) (108,279)
Realized gain on
distributions 572,641 648,125 214 31,722 103,641 --- 783,702 13,406 1,369,749
Unrealized
appreciation
(depreciation)
on investments 1,963,600 5,559,439 1,105,398 (69,959) (39,482) --- 6,555,396 --- 8,518,996
3,368,677 8,451,940 1,259,100 31,102 116,852 15,469 9,874,463 (77,919) 13,165,221
Contributions:
Employers--
MDU --- 695,789 --- --- --- --- 695,789 --- 695,789
Williston Basin --- 199,352 --- --- --- --- 199,352 --- 199,352
Knife River --- 275,059 --- --- --- --- 275,059 --- 275,059
--- 1,170,200 --- --- --- --- 1,170,200 --- 1,170,200
Employees--
MDU --- 1,096,580 674,281 90,944 200,526 18,738 2,081,069 --- 2,081,069
Williston Basin --- 310,752 161,998 32,790 44,514 3,183 553,237 --- 553,237
Knife River --- 284,305 254,419 44,331 88,674 26,961 698,690 --- 698,690
--- 1,691,637 1,090,698 168,065 333,714 48,882 3,332,996 --- 3,332,996
Employee rollover
MDU --- 536 2,073 --- --- --- 2,609 --- 2,609
Williston Basin --- --- --- --- --- --- --- --- ---
Knife River --- --- 5,028 3,771 3,771 --- 12,570 --- 12,570
--- 536 7,101 3,771 3,771 --- 15,179 --- 15,179
--- 2,862,373 1,097,799 171,836 337,485 48,882 4,518,375 --- 4,518,375
Distributions to
terminated
participants (1,299,878) (2,642,325) (151,907) (50,023) (14,099) (5,782) (2,864,136) (612) (4,164,626)
Transfers of
participants'
equity:
Fund to Fund --- (35,978) 252,031 (5,528) 209,527 447,291 867,343 (867,343) ---
Plan to Plan 286,464 214,882 97,313 1,796 --- --- 313,991 --- 600,455
286,464 178,904 349,344 (3,732) 209,527 447,291 1,181,334 (867,343) 600,455
Increase (decrease)
in participants'
equity 2,355,263 8,850,892 2,554,336 149,183 649,765 505,860 12,710,036 (945,874) 14,119,425
Participants'
equity
at beginning
of year 15,078,202 39,792,676 4,832,531 1,106,402 791,652 246,507 46,769,768 945,874 62,793,844
Participants'
equity
at end
of year $17,433,465 $48,643,568 $7,386,867 $1,255,585 $1,441,417 $752,367 $59,479,804 $ --- $76,913,269
The accompanying notes are an integral part
of this schedule.
</TABLE>
<TABLE>
ALLOCATION OF PLAN INCOME AND CHANGES
IN PLAN EQUITY TO INVESTMENT PROGRAMS
Year ended December 31, 1995
<CAPTION>
Total
ESOP Deferred Savings Deferred Profit
MDU Stock MDU Stock Vanguard Mellon Fidelity STIF Savings Sharing Total
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Investment income:
Dividends $ 811,566 $ 2,071,881 $ 94,903 $ 56,651 $ 25,695 $ --- $ 2,249,130 $ 24,353 $ 3,085,049
Interest 42 5,075 959 330 862 11,566 18,792 2,708 21,542
Capital gains --- --- 10,645 --- --- --- 10,645 --- 10,645
Other --- 4,864 1,162 --- 809 (292) 6,543 (25,840) (19,297)
Realized gain (loss)
on distributions 525,653 641,926 977 (82) 523 --- 643,344 69,333 1,238,330
Unrealized
appreciation
on investments 861,743 2,707,985 1,086,893 99,432 48,160 --- 3,942,470 12,940 4,817,153
2,199,004 5,431,731 1,195,539 156,331 76,049 11,274 6,870,924 83,494 9,153,422
Contributions:
Employers--
MDU --- 738,820 --- --- --- --- 738,820 --- 738,820
Williston Basin --- 183,574 --- --- --- --- 183,574 --- 183,574
Knife River --- 214,426 --- --- --- --- 214,426 100,000 314,426
--- 1,136,820 --- --- --- --- 1,136,820 100,000 1,236,820
Employees--
MDU --- 1,151,433 491,880 95,396 191,473 21,074 1,951,256 --- 1,951,256
Williston Basin --- 287,190 112,832 28,823 40,012 2,748 471,605 --- 471,605
Knife River --- 238,396 127,147 34,792 65,950 31,884 498,169 --- 498,169
--- 1,677,019 731,859 159,011 297,435 55,706 2,921,030 --- 2,921,030
Employee rollover--
MDU --- 17,660 --- --- --- 1,742 19,402 --- 19,402
Williston Basin --- --- --- --- --- --- --- --- ---
Knife River --- 344 38 --- --- --- 382 --- 382
--- 18,004 38 --- --- 1,742 19,784 --- 19,784
--- 2,831,843 731,897 159,011 297,435 57,448 4,077,634 100,000 4,177,634
Distributions to
terminated
participants (1,265,738) (3,172,483) (94,019) (29,841) (17,489) (9,667) (3,323,499) (105,756) (4,694,993)
Transfers of
participants'
equity:
Fund to Fund --- 4,803 24,383 11,857 9,225 (50,268) --- --- ---
Plan to Plan 59,204 134,919 140,410 29,223 143,342 171,187 619,081 --- 678,285
59,204 139,722 164,793 41,080 152,567 120,919 619,081 --- 678,285
Increase
in participants'
equity 992,470 5,230,813 1,998,210 326,581 508,562 179,974 8,244,140 77,738 9,314,348
Participants'
equity
at beginning
of year 14,085,732 34,561,863 2,834,321 779,821 283,090 66,533 38,525,628 868,136 53,479,496
Participants'
equity
at end
of year $15,078,202 $39,792,676 $4,832,531 $1,106,402 $791,652 $246,507 $46,769,768 $945,874 $62,793,844
The accompanying notes are an integral part
of this schedule.
</TABLE>
<TABLE>
ALLOCATION OF PLAN INCOME AND CHANGES
IN PLAN EQUITY TO INVESTMENT PROGRAMS
Year ended December 31, 1994
<CAPTION>
Total
ESOP Deferred Savings Deferred
MDU Stock MDU Stock Vanguard Mellon Fidelity STIF Savings Total
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Investment income:
Dividends $ 802,609 $ 1,884,703 $ 70,960 $ 29,186 $ 4,237 $ --- $ 1,989,086 $ 2,791,695
Interest 2,535 8,745 167 11,167 51 1,374 21,504 24,039
Capital gains --- --- 12,091 --- --- --- 12,091 12,091
Other --- --- (10) (145) --- (28) (183) (183)
Realized gain (loss)
on distributions 479,306 521,651 4,224 (9,026) --- --- 516,849 996,155
Unrealized depreciation
on investments (2,649,746) (5,599,607) (57,553) (55,127) (8,678) --- (5,720,965) (8,370,711)
(1,365,296) (3,184,508) 29,879 (23,945) (4,390) 1,346 (3,181,618) (4,546,914)
Contributions:
Employers --
MDU --- 720,221 --- --- --- --- 720,221 720,221
Williston Basin --- 175,905 --- --- --- --- 175,905 175,905
Knife River --- 185,230 --- --- --- --- 185,230 185,230
--- 1,081,356 --- --- --- --- 1,081,356 1,081,356
Employees --
MDU --- 1,184,767 472,737 103,467 120,326 5,903 1,887,200 1,887,200
Williston Basin --- 268,320 116,208 33,893 29,222 2,008 449,651 449,651
Knife River --- 280,741 87,549 38,720 8,224 3,209 418,443 418,443
--- 1,733,828 676,494 176,080 157,772 11,120 2,755,294 2,755,294
Employee rollover --
MDU --- 9,617 483 240 2 --- 10,342 10,342
Williston Basin --- --- --- --- --- --- --- ---
Knife River --- 181,845 124,131 122,397 --- --- 428,373 428,373
--- 191,462 124,614 122,637 2 --- 438,715 438,715
--- 3,006,646 801,108 298,717 157,774 11,120 4,275,365 4,275,365
Distributions to
terminated
participants (1,040,454) (2,071,259) (53,547) (21,441) (1,250) --- (2,147,497) (3,187,951)
Transfers of
participants' equity:
Fund to Fund --- 81,140 (190,274) (75,889) 130,956 54,067 --- ---
Plan to Plan 53,095 95,911 14,642 4,796 --- --- 115,349 168,444
53,095 177,051 (175,632) (71,093) 130,956 54,067 115,349 168,444
Increase (decrease) in
participants' equity (2,352,655) (2,072,070) 601,808 182,238 283,090 66,533 (938,401) (3,291,056)
Participants' equity
at beginning of year 16,438,387 36,633,933 2,232,513 597,583 --- --- 39,464,029 55,902,416
Participants' equity
at end of year $14,085,732 $34,561,863 $2,834,321 $779,821 $283,090 $66,533 $38,525,628 $52,611,360
The accompanying notes are an integral part
of this schedule.
</TABLE>
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To MDU Resources Group, Inc.:
We have audited the accompanying statements of financial condition
of MDU Resources Group, Inc. Tax Deferred Compensation Savings
Plan as of December 31, 1996 and 1995, and the related statements
of income and changes in participants' equity for each of the
three years in the period ended December 31, 1996. These
financial statements and the schedules referred to below are the
responsibility of the Plan Administrator. Our responsibility is
to express an opinion on these financial statements and
supplemental schedules 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 MDU
Resources Group, Inc. Tax Deferred Compensation Savings Plan as of
December 31, 1996 and 1995 and the results of its operations and
the changes in participants' equity for each of the three years in
the period ended December 31, 1996 in conformity with generally
accepted accounting principles.
Our audits were made for the purpose of forming an opinion on the
basic financial statements taken as a whole. The supplemental
schedules are presented for purposes of additional analysis and
are not a required part of the basic financial statements. This
information has been subjected to the auditing procedures applied
in our audit of the basic financial statements and, in our
opinion, is fairly stated in all material respects in relation to
the basic financial statements taken as a whole.
/s/ ARTHUR ANDERSEN LLP
ARTHUR ANDERSEN LLP
Minneapolis, Minnesota,
March 18, 1997
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of
1934, the Tax Deferred Compensation Savings Plan committee has
duly caused this annual report to be signed on its behalf by the
undersigned hereunto duly authorized.
MDU Resources Group, Inc.
Tax Deferred Compensation
Savings Plan
Date: March 28, 1997 By /s/ Douglas C. Kane
Douglas C. Kane (Chairman)
<PAGE>
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the
incorporation of our report included in this Form 11-K, into the
Company's previously filed Registration Statements (Form S-8
No. 33-53896 and No. 333-06105).
/s/ ARTHUR ANDERSEN LLP
ARTHUR ANDERSEN LLP
Minneapolis, Minnesota,
March 28, 1997
