As filed with the Securities and Exchange Commission on May 1, 2000
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8 - K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
DATE OF REPORT - MAY 1, 2000
Commission Registrant, State of Incorporation I.R.S. Employer
File Number Address and Telephone Number Identification No.
- ----------- ---------------------------------- ------------------
0-25595 NIAGARA MOHAWK HOLDINGS, INC. 16-1549726
(a New York corporation)
300 Erie Boulevard West
Syracuse, New York 13202
Telephone 315-474-1511
1-2987 NIAGARA MOHAWK POWER CORPORATION 15-0265555
(a New York corporation)
300 Erie Boulevard West
Syracuse, New York 13202
Telephone 315-474-1511
<PAGE>
Item 5. Other Events
- ---------------------
(a) On May 1, 2000, Niagara Mohawk Holdings, Inc. issued a press release
relating to its first quarter earnings for 2000. See attached Exhibit
No. 99.
Item 7. Financial Statements and Exhibits
- ------------------------------------------
(c) Exhibits - Following is the list of Exhibits furnished in accordance
with the provisions of Item 601 of Regulation S-K, filed as part of this
current report on Form 8-K.
Exhibit No. 99 - Press release of Niagara Mohawk Holdings, Inc. issued on May 1,
2000 relating to its first quarter earnings for 2000.
<PAGE>
NIAGARA MOHAWK HOLDINGS, INC. AND SUBSIDIARY COMPANIES
SIGNATURE
---------
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrants have duly caused this report to be signed on their behalf by the
undersigned thereunto duly authorized.
NIAGARA MOHAWK HOLDINGS, INC.
-----------------------------
(Registrant)
Date: May 1, 2000 By: /s/Steven W. Tasker
------------------------------
Steven W. Tasker
Vice President-Controller and
Principal Accounting Officer,
in his respective capacities
as such
NIAGARA MOHAWK POWER CORPORATION
--------------------------------
(Registrant)
Date: May 1, 2000 By: /s/Steven W. Tasker
--------------------------------
Steven W. Tasker
Vice President-Controller and
Principal Accounting Officer,
in his respective capacities
as such
<PAGE>
EXHIBIT INDEX
-------------
Following is the index of Exhibits furnished in accordance with the provisions
of Item 601 of Regulation S-K, filed as part of this current report on Form 8-K.
Exhibit No. 99 - Press release of Niagara Mohawk Holdings, Inc. issued on May 1,
2000 relating to its first quarter earnings for 2000.
Exhibit No. 99
News Release
NIAGARA MOHAWK HOLDINGS REPORTS FIRST QUARTER RESULTS
SYRACUSE, May 1 - Niagara Mohawk Holdings, Inc. (NYSE: NMK) today reported
financial results for the first quarter 2000. Niagara Mohawk Holdings, Inc.
(the company) is the parent company of Niagara Mohawk Power Corp. (Niagara
Mohawk), a regulated energy delivery company.
Earnings before interest, taxes, depreciation and amortization (EBITDA) for
the twelve months ended March 31, 2000 were approximately $1.16 billion,
compared to approximately $1.17 billion in the same period ended in 1999.
The company reported earnings for the first quarter of 2000 of $14.5
million, or 8 cents per share, as compared to $50.8 million, or 27 cents per
share, for the first quarter in 1999. Earnings in the first quarter 2000 were
down primarily as a result of lower gas gross margin, which reduced earnings for
the quarter by approximately $22.5 million, or 13 cents per share. Gas gross
margins were lower in part because of a change in the regulatory adjustment
mechanism used to record gas costs, the effect of which should reverse over the
remainder of the year.
First quarter 2000 earnings were also impacted by increased costs associated
with the operation of the newly formed New York Independent System Operator
(NYISO), which reduced earnings by approximately $14.3 million, or 8 cents per
share. The NYISO, which began formal operations on December 1, 1999,
replaced the New York Power Pool and now manages the bulk transmission system in
New York State. The company experienced higher NYISO costs related to ancillary
service charges and energy purchases. The NYISO and Niagara Mohawk have
petitioned the FERC regarding the magnitude of NYISO charges for ancillary
services and have asked the FERC to order a refund of some of these charges.
Niagara Mohawk is unable to predict the FERC's response. In addition, the
company believes that some portion of the NYISO charges will be reversed as the
NYISO performs load reconciliations for the first quarter. The higher NYISO
costs experienced by Niagara Mohawk are primarily related to start-up issues at
the NYISO. The company expects that as the bulk power market matures these
issues will be resolved.
Additionally, earnings in the first quarter of 2000 were reduced by
approximately $5 million, or 3 cents per share, by costs related to the Nine
Mile Two refueling outage and by approximately $5 million, or 3 cents per share,
as a result of the second phase of electric price reductions implemented as part
of the company's current electric regulatory agreement.
First quarter earnings reductions were partially offset by $12.3 million,
or 7 cents per share, in decreased interest expense due to the retirement of
over $1 billion in debt in 1999.
"While earnings will continue to be depressed during the period in which we
amortize the costs of the Master Restructuring Agreement, the company's strong
cash flow allows us to continue with our aggressive debt retirement and share
repurchase programs," said William E. Davis, chairman and chief executive
officer of Niagara Mohawk Holdings.
The company reported a loss of $71.4 million or a loss of 39 cents per
share for the 12 months ended March 31, 2000, as compared to a loss of $117.7
million, or a loss of 67 cents per share, for the 12-month period a year ago.
The loss for the 12-month period ended March 31, 1999 reflects the impact of the
one-time, non-cash charge to earnings in 1998 of $171.1 million, or 97 cents per
share, related to the MRA. Earnings for the 12-month periods ended March 31,
2000 and March 31, 1999 include charges of $251.2 million, or $1.36 per share,
and $146.5 million, or $0.83 per share, respectively, for the non-cash
amortization of the MRA regulatory asset. In addition, earnings for the 12
months ended March 31, 2000 include an extraordinary charge of $23.8 million,
or 13 cents per share, related to the early retirement of debt.
Niagara Mohawk's electric revenues in the first quarter of 2000 were $823.7
million, down 3.1 percent from the first quarter of 1999. Electric revenues
for the 12 months ended March 31, 2000 were $3,221.7 million, down 0.8 percent
compared to the same period in 1999. Retail sales of electricity decreased 8.0
percent and increased 0.6 percent for the 3-month and 12- month periods ended
March 31, 2000, respectively, as compared to the same periods in 1999. Retail
sales in the first quarter of 1999 include the one-time impact of billing
customers on a monthly basis rather than bi-monthly. Retail revenues declined
in part as more customers chose to buy energy from other companies under retail
choice, as well as due to warmer weather and lower prices.
Niagara Mohawk's natural gas revenues for 1999 were $245.1 million, down
0.5 percent from the first quarter of 1999. For the 12 months ended March 31,
2000, natural gas revenues were $578.4 million, up 0.4 percent, compared to the
same period in 1999. Retail sales of natural gas for the 3 months and the 12
months ended March 31, 2000 decreased 6.6 percent and 4.9 percent, respectively,
compared to the same periods in 1999. Total gas deliveries, which includes the
transportation of customer-owned gas, were down 6.2 percent for the three months
ended 2000, and up 2.9 percent for the twelve months ended March 31, 2000,
respectively, as compared to the same periods in 1999.
Consolidated Statements of Income will be filed today with the Securities
and Exchange Commission on Form 8-K.
The company will host a conference call at 10:00 a.m. EDT to discuss
first-quarter results. In order to join the conference call, please dial
888-868-9078 after 9:50 a.m. For those unable to join the call at that time,
a replay will be available for one week by calling 888-463-5487.
NOTE: This release contains statements that constitute forward-looking
information. Such statements are subject to certain risks, uncertainties
and assumptions. All of these forward-looking statements are based on
estimates and assumptions made by the company's management which,
although believed by the company's management to be reasonable, are
inherently uncertain. Such forward-looking statements are not guarantees
of future performance or results and involve certain risks and
uncertainties. Actual results or developments may differ materially from
the forward-looking statements as a result of various factors.
NIAGARA MOHAWK HOLDINGS, INC.
CONSOLIDATED STATEMENTS OF INCOME (Unaudited)
<TABLE>
<CAPTION>
In thousands of dollars
Three Months Ended Twelve Months Ended
March 31, March 31,
2000 1999 2000 1999*
---- ---- ---- ----
<S> <C> <C> <C> <C>
OPERATING REVENUES:
Electric $ 924,895 $ 864,678 $3,525,118 $3,341,658
Gas 263,599 254,407 620,418 605,526
Other 977 49 8,987 473
- --------------------------------------- ----------- ----------- ----------- -----------
1,189,471 1,119,134 4,154,523 3,947,657
----------- ----------- ----------- -----------
OPERATING EXPENSES:
Electricity purchased 375,055 175,292 1,212,574 938,826
Fuel for electric generation 13,330 57,094 145,893 249,878
Gas purchased 156,986 115,258 339,369 292,426
Other operation and maintenance expenses 219,901 206,343 924,429 890,321
Power Choice charge - - - 263,227
Amortization of MRA regulatory asset 96,625 96,625 386,499 225,458
Depreciation and amortization 77,950 94,816 328,607 362,676
Other taxes 78,268 121,858 371,492 455,638
- --------------------------------------- ----------- ----------- ----------- -----------
1,018,115 867,286 3,708,863 3,678,450
----------- ----------- ----------- -----------
OPERATING INCOME 171,356 251,848 445,660 269,207
Other income (deductions) (4,918) (1,403) 280 52,341
- --------------------------------------- ----------- ----------- ----------- -----------
INCOME BEFORE INTEREST CHARGES 166,438 250,445 445,940 321,548
Interest charges 111,332 130,275 466,297 461,863
Preferred dividend requirement of subsidiary 7,904 9,024 35,688 36,356
- --------------------------------------- ----------- ----------- ----------- -----------
INCOME (LOSS) BEFORE FEDERAL & FOREIGN
INCOME TAXES 47,202 111,146 (56,045) (176,671)
Federal and foreign income taxes 32,728 60,314 (8,406) (58,983)
- --------------------------------------- ----------- ----------- ----------- -----------
INCOME (LOSS) BEFORE EXTRAORDINARY ITEM 14,474 50,832 (47,639) (117,688)
Extraordinary item - Loss from the
extinguishment of debt, net of income
taxes of $12,819 - - (23,807) -
- --------------------------------------- ----------- ----------- ----------- -----------
NET INCOME (LOSS) $ 14,474 $ 50,832 $ (71,446) $ (117,688)
- --------------------------------------- =========== =========== =========== ===========
AVERAGE NUMBER OF SHARES OF COMMON
STOCK OUTSTANDING (IN THOUSANDS) 177,352 187,365 184,201 176,776
BASIC AND DILUTED EARNINGS (LOSS)
PER AVERAGE SHARE OF COMMON STOCK BEFORE
EXTRAORDINARY ITEM $ 0.08 $ 0.27 $ (0.26) $ (0.67)
EXTRAORDINARY ITEM PER AVERAGE SHARE OF
COMMON STOCK - - (0.13) -
- --------------------------------------- ----------- ----------- ----------- -----------
BASIC AND DILUTED EARNINGS (LOSS)
PER AVERAGE SHARE OF COMMON STOCK $ 0.08 $ 0.27 $ (0.39) $ (0.67)
- --------------------------------------- =========== =========== =========== ===========
OTHER OPERATING DATA:
Earnings before interest charges, interest
income, income taxes, depreciation and
amortization, and other regulatory
adjustments (EBITDA) $1,159,000 $1,173,000
Net cash interest $ 377,000 $ 388,000
Ratio of EBITDA to net cash interest 3.1 3.0
</TABLE>
NOTES:
* Prior period consolidated financial statements have been prepared from
Niagara Mohawk Power Corporation's period consolidated financial statements,
except that accounts have been reclassified to reflect the Niagara Mohawk
Holdings' structure.
** EBITDA for the twelve months ended March 31, 1999, which had been reported
as of $1,245,500, has been restated reflecting a change in the Company's
EBITDA calculation methodology.
- - The above information is not given in connection with any sale or offer to
sell or buy any stock or security.
- - The Company files periodic reports pursuant to the Securities Exchange Act
of 1934. Accordingly, with respect to the financial information set forth
above, you are requested to refer to such filings for more detailed
information.
NIAGARA MOHAWK POWER CORPORATION AND SUBSIDIARY COMPANIES
CONSOLIDATED STATEMENTS OF INCOME (Unaudited)
<TABLE>
<CAPTION>
In thousands of dollars
THREE MONTHS ENDED TWELVE MONTHS ENDED
MARCH 31, MARCH 31,
2000 1999 2000 1999
---- ---- ---- ----
<S> <C> <C> <C> <C>
OPERATING REVENUES:
Electric $ 823,672 $ 849,746 $3,221,683 $3,247,721
Gas 245,107 246,275 578,415 576,269
----------- ----------- ----------- -----------
1,068,779 1,096,021 3,800,098 3,823,990
- --------------------------------------- ----------- ----------- ----------- -----------
OPERATING EXPENSES:
Electricity purchased:
Independent power producers 78,869 109,611 308,005 548,781
Hydro/Fossil power purchase agreements 29,485 - 154,813 -
NYISO 118,806 - 151,425 -
Swap payments 17,539 21,874 93,841 73,042
Other 35,191 29,480 217,879 216,783
- --------------------------------------- ----------- ----------- ----------- -----------
279,890 160,965 925,963 838,606
Fuel for electric generation 13,330 57,094 145,893 249,878
Gas purchased 138,432 107,346 297,809 264,035
Other operation and maintenance expenses 214,689 203,292 900,497 878,728
Power Choice charge - - - 263,227
Amortization of MRA regulatory asset 96,625 96,625 386,499 225,458
Depreciation and amortization 77,832 94,692 328,070 362,159
Other taxes 77,263 121,723 367,382 454,889
- --------------------------------------- ----------- ----------- ----------- -----------
898,061 841,737 3,352,113 3,536,980
----------- ----------- ----------- -----------
OPERATING INCOME 170,718 254,284 447,985 287,010
Other income (deductions) (7,365) (3,839) (9,208) 34,538
- --------------------------------------- ----------- ----------- ----------- -----------
INCOME BEFORE INTEREST CHARGES 163,353 250,445 438,777 321,548
Interest charges 111,332 130,275 466,297 461,863
- --------------------------------------- ----------- ----------- ----------- -----------
INCOME (LOSS) BEFORE FEDERAL & FOREIGN
INCOME TAXES 52,021 120,170 (27,520) (140,315)
Federal and foreign income taxes 31,188 60,314 (10,243) (58,983)
- --------------------------------------- ----------- ----------- ----------- -----------
INCOME (LOSS) BEFORE EXTRAORDINARY ITEM 20,833 59,856 (17,277) (81,332)
Extraordinary item - Loss from the
extinguishment of debt, net of income
taxes of $12,819 - - (23,807) -
- --------------------------------------- ----------- ----------- ----------- -----------
NET INCOME (LOSS) 20,833 59,856 (41,084) (81,332)
Dividends on preferred stock 7,904 9,024 35,688 36,356
- --------------------------------------- ----------- ----------- ----------- -----------
BALANCE AVAILABLE FOR COMMON STOCK $ 12,929 $ 50,832 $ (76,772) $ (117,688)
=========== =========== =========== ===========
</TABLE>
NOTES:
- - The above information is not given in connection with any sale or offer to
sell or buy any stock or security.
- - The Company files periodic reports pursuant to the Securities Exchange Act
of 1934. Accordingly, with respect to the financial information set forth
above, you are requested to refer to such filings for more detailed
information.
NIAGARA MOHAWK HOLDINGS, INC.
-----------------------------
(Unaudited)
EARNINGS REPORT
---------------
(In thousands of dollars)
<TABLE>
<CAPTION>
THREE MONTHS ENDED TWELVE MONTHS ENDED
MARCH 31, MARCH 31,
2000 1999 2000 1999
---- ---- ---- ----
<S> <C> <C> <C> <C>
Operating Revenues $1,189,471 $1,119,134 $4,154,523 $3,947,657
Operating Income 171,356 251,848 445,660 269,207
Income (Loss) Before
Extraordinary Item 14,474 50,832 (47,639) (117,688)
Extraordinary Item for Loss from
Extinguishment of Debt (Net) -- -- (23,807) --
Net Income (Loss) $ 14,474 $ 50,832 $ (71,446) $ (117,688)
Average Number of Shares of
Common Stock Outstanding
(in thousands) 177,352 187,365 184,201 176,776
Basic and Diluted Earnings (Loss) per
Average Share of Common Stock Before
Extraordinary Item $ 0.08 $ 0.27 $ (0.26) $ (0.67)
Extraordinary Item Per Average Share of
Common Stock -- -- (0.13) --
Basic and Diluted Earnings (Loss)
per Average Share of Common Stock $ 0.08 $ 0.27 $ (0.39) $ (0.67)
EBITDA -- -- $1,159,000 $1,173,000
Net Cash Interest -- -- $ 377,000 $ 388,000
Ratio of EBITDA to Net Cash Interest -- -- 3.1 3.0
</TABLE>
Note 1 - The above information is not given in connection with any sale or
offer to sell or buy any stock or security.
Note 2 - The Company files periodic reports pursuant to the Securities
Exchange Act of 1934. Accordingly, with respect to the financial
information set forth above, you are requested to refer to such
filings for more detailed information.
Note 3 - EBITDA for the twelve months ended March 31, 1999, which had been
reported as $1,245,500, has been restated reflecting a change in
the Company's EBITDA calculation methodology.
