UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
[ X ]Quarterly Report Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
For the quarterly period ended September 30, 1997
or
[ ]Transition Report Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
For the transition period from to
Commission file number 1-7297
NICOR Inc.
(Exact name of registrant as specified in its charter)
Illinois 36-2855175
(State of incorporation) (I.R.S. Employer
Identification No.)
1844 Ferry Road
Naperville, Illinois 60563-9600
(Address of principal (Zip Code)
executive offices)
(630) 305-9500
(Registrant's telephone number)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act
of 1934 during the preceding 12 months and (2) has been subject to such
filing requirements for the past 90 days. Yes [X] No [ ]
Shares of common stock, par value $2.50, outstanding at October 31, 1997,
were 48,348,450.
Nicor Inc. Page i
Table of Contents
Page
Part I. Financial Information
Item 1. Financial Statements (Unaudited) 1
Consolidated Statement of Income -
Three, Nine and Twelve Months Ended
September 30, 1997 and 1996 2
Consolidated Statement of Cash Flows -
Nine and Twelve Months Ended
September 30, 1997 and 1996 3
Consolidated Balance Sheet -
September 30, 1997 and 1996, and
December 31, 1996 4
Notes to the Consolidated Financial Statements 5
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of
Operations 7
Part II.Other Information
Item 1. Legal Proceedings 13
Item 2. Changes in Securities and Use of Proceeds 13
Item 6. Exhibits and Reports on Form 8-K 13
Signature 14
Exhibit Index 15
Selected terms:
Ill.C.C. - Illinois Commerce Commission.
Mcf, Bcf - Thousand cubic feet, billion cubic feet.
TEU - Twenty-foot equivalent unit.
Degree days - The extent to which the daily average
temperature falls below 65 degrees
Fahrenheit.
Nicor Inc. Page 1
As part of Nicor's plans to bring all of its energy-related businesses
together under one name, Northern Illinois Gas Company will be doing
business as Nicor Gas. Although Northern Illinois Gas will continue to
function as a legal entity, products and services are now marketed under a
single common brand identity "Nicor." Northern Illinois Gas is hereinafter
referred to as Nicor Gas.
PART I -Financial Information
Item 1.Financial Statements
The following condensed unaudited financial statements of
Nicor Inc. have been prepared by the company pursuant to the rules
and regulations of the Securities and Exchange Commission (SEC).
Certain information and footnote disclosures normally included in
financial statements prepared in accordance with generally accepted
accounting principles have been condensed or omitted pursuant to
SEC rules and regulations. The condensed financial statements
should be read in conjunction with the financial statements and the
notes thereto included in the company's latest Annual Report on
Form 10-K.
The information furnished reflects, in the opinion of the company,
all adjustments (consisting only of normal recurring adjustments)
necessary for a fair statement of the results for the interim
periods presented. Because of seasonal and other factors, the
results for the interim periods presented are not necessarily
indicative of the results to be expected for the full fiscal year.
<TABLE>
Nicor Inc. Page 2
Consolidated Statement of Income (Unaudited)
(Millions, except per share data)
<CAPTION>
Three months ended Nine months ended Twelve months ended
September 30 September 30 September 30
1997 1996 1997 1996 1997 1996
<S> <C> <C> <C> <C> <C> <C>
Operating revenues $ 209.2 $ 220.4 $1,412.9 $1,257.8 $2,005.8 $1,724.1
Operating expenses
Cost of gas 58.2 75.8 813.9 677.8 1,180.8 937.6
Operating and maintenance 82.7 80.4 245.4 233.5 338.6 316.5
Depreciation 16.9 16.5 92.1 87.2 130.3 120.4
Taxes, other than income taxes 12.8 12.4 97.0 89.9 127.9 116.3
170.6 185.1 1,248.4 1,088.4 1,777.6 1,490.8
Operating income 38.6 35.3 164.5 169.4 228.2 233.3
Other income (expense)
Interest income .8 .3 2.5 1.2 2.8 1.7
Other, net 2.0 (.1) 4.7 (1.8) 8.6 .4
2.8 .2 7.2 (.6) 11.4 2.1
Income before interest on debt
and income taxes 41.4 35.5 171.7 168.8 239.6 235.4
Interest on debt, net of
amounts capitalized 11.5 11.9 35.2 34.2 48.8 45.7
Income before income taxes 29.9 23.6 136.5 134.6 190.8 189.7
Income taxes 10.4 8.5 47.9 48.6 67.0 67.9
Income from continuing operations 19.5 15.1 88.6 86.0 123.8 121.8
Income from discontinued
operations, net of income taxes - - - 15.0 - 15.0
Net income 19.5 15.1 88.6 101.0 123.8 136.8
Dividends on preferred stock .1 .1 .2 .3 .4 .5
Earnings applicable to common stock $ 19.4 $ 15.0 $ 88.4 $ 100.7 $ 123.4 $ 136.3
Average shares of common
stock outstanding 48.5 50.0 48.9 50.1 49.1 50.2
Earnings per average share
of common stock
Continuing operations $ .40 $ .30 $ 1.81 $ 1.71 $ 2.52 $ 2.42
Discontinued operations - - - .30 - .30
$ .40 $ .30 $ 1.81 $ 2.01 $ 2.52 $ 2.72
Dividends declared per share
of common stock $ .35 $ .33 $ 1.05 $ .99 $ 1.37 $ 1.31
<F1>
The accompanying notes are an integral part of this statement.
</TABLE>
<TABLE>
Nicor Inc. Page 3
Consolidated Statement of Cash Flows (Unaudited)
(Millions)
<CAPTION>
Nine months ended Twelve months ended
September 30 September 30
1997 1996 1997 1996
Operating activities
<S> <C> <C> <C> <C>
Net income $ 88.6 $ 101.0 $ 123.8 $ 136.8
Adjustments to reconcile net income to net
cash flow provided from operating activities:
Depreciation 92.1 87.2 130.3 120.4
Deferred income tax expense (benefit) (11.6) (16.6) 3.6 (9.0)
Change in working capital items and other:
Receivables, less allowances 185.5 119.6 (12.4) (47.7)
Gas in storage (27.0) (72.0) (10.2) (76.1)
Deferred/accrued gas costs 61.7 (33.7) 53.0 (25.2)
Accounts payable (70.5) (73.2) 27.5 (22.5)
Other (12.9) (2.8) (14.6) (.1)
Net cash flow provided from operating activities 305.9 109.5 301.0 76.6
Investing activities
Capital expenditures (73.7) (78.3) (115.3) (128.1)
Short-term investments - 12.3 (5.4) 7.5
Other (6.8) (2.8) (3.5) (1.1)
Net cash flow used for investing activities (80.5) (68.8) (124.2) (121.7)
Financing activities
Net proceeds from issuing long-term debt 49.7 74.3 49.7 123.8
Disbursements to retire long-term debt (25.0) (50.0) (25.0) (50.0)
Short-term borrowings (repayments), net (169.3) 3.3 (79.4) 58.9
Dividends paid (50.8) (49.5) (67.3) (65.7)
Disbursements to reacquire stock (40.6) (21.1) (55.2) (22.8)
Other 1.1 4.7 2.2 6.2
Net cash flow provided from (used for) financing
activities (234.9) (38.3) (175.0) 50.4
Net increase (decrease) in cash and cash equivalents (9.5) 2.4 1.8 5.3
Cash and cash equivalents, beginning of period 20.5 6.8 9.2 3.9
Cash and cash equivalents, end of period $ 11.0 $ 9.2 $ 11.0 $ 9.2
Supplemental information
Income taxes paid, net of refunds $ 43.4 $ 55.8 $ 62.9 $ 64.6
Interest paid, net of amounts capitalized 41.0 39.7 47.7 43.3
<F1>
The accompanying notes are an integral part of this statement.
</TABLE>
<TABLE>
Nicor Inc. Page 4
Consolidated Balance Sheet (Unaudited)
(Millions)
<CAPTION>
September 30 December 31 September 30
Assets 1997 1996 1996
Current assets
<S> <C> <C> <C> <C> <C> <C>
Cash and cash equivalents $ 11.0 $ 20.5 $ 9.2
Short-term investments, at cost which
approximates market 12.7 12.7 7.3
Receivables, less allowances of $8.8,
$7.7 and $6.8, respectively 154.5 340.0 142.1
Gas in storage, at last-in, first-out cost 145.2 118.2 135.0
Deferred gas costs - 51.1 42.4
Other 25.5 30.9 28.4
348.9 573.4 364.4
Property, plant and equipment, at cost
Gas distribution 3,014.0 2,957.3 2,946.3
Shipping 238.6 233.9 234.2
Other .6 1.5 1.0
3,253.2 3,192.7 3,181.5
Less accumulated depreciation 1,502.0 1,420.8 1,410.8
1,751.2 1,771.9 1,770.7
Other assets 116.9 93.3 92.2
$ 2,217.0 $ 2,438.6 $ 2,227.3
Liabilities and Capitalization
Current liabilities
Long-term obligations due within one year $ 25.4 $ 25.0 $ 25.2
Short-term borrowings 122.7 292.0 202.1
Accounts payable 263.4 333.9 235.9
Other 41.6 48.9 31.3
453.1 699.8 494.5
Deferred credits and other liabilities
Deferred income taxes 214.2 211.6 192.0
Regulatory income tax liability 82.1 83.8 84.5
Unamortized investment tax credits 46.8 48.4 49.2
Other 135.3 139.9 157.5
478.4 483.7 483.2
Capitalization
Long-term debt 550.1 518.0 518.4
Preferred stock
Redeemable 6.3 7.4 8.6
Nonredeemable .1 .1 .1
Common equity
Common stock 121.1 123.7 124.5
Paid-in capital - 23.8 34.6
Retained earnings 607.9 582.1 563.4
1,285.5 1,255.1 1,249.6
$ 2,217.0 $ 2,438.6 $ 2,227.3
<F1>
The accompanying notes are an integral part of this statement.
</TABLE>
Nicor Inc. Page 5
Notes to the Consolidated Financial Statements (Unaudited)
ACCOUNTING POLICIES
Depreciation for the gas distribution segment is calculated using a
straight-line method for the calendar year. For interim periods,
depreciation is allocated based on gas deliveries. In April 1996, the gas
distribution composite depreciation rate was increased to 4.1 percent from
3.7 percent.
NEW ACCOUNTING PRONOUNCEMENT
In February 1997, the Financial Accounting Standards Board issued Statement
No. 128, Earnings per Share. This statement simplifies the standards for
computing earnings per share (EPS) and makes them comparable to
international EPS standards. Statement No. 128 is effective for financial
statements issued for periods ending after December 15, 1997, and requires
restatement of all prior-period EPS data presented. This statement is not
expected to have a material impact on the company's EPS.
RATE PROCEEDING
On April 3, 1996, the Ill.C.C. granted Nicor Gas a $33.7 million general
rate increase, of which $12 million relates to a change in the company's
composite depreciation rate. The new rate structure, effective April 11,
1996, allows Nicor Gas to recover a larger proportion of its fixed costs
during warmer months. In June 1997, the order was upheld by the Third
District Appellate Court of Illinois.
LONG-TERM DEBT
In October 1997, Nicor Gas issued $50 million of 7-3/8% First Mortgage Bonds
due in 2027. The net proceeds from the sale of the bonds will be used,
together with other corporate funds, for the November 1997 retirement of $50
million of 9% First Mortgage Bonds due in 2019.
In June 1997, Nicor Gas sold $50 million of 6.75% First Mortgage Bonds due
in 2002. The net proceeds from the sale of the bonds replenished corporate
funds used for the February 1997 maturity of $25 million of 5-1/2% First
Mortgage Bonds and general corporate purposes.
SHAREHOLDER RIGHTS PLAN
On September 9, 1997, the company's board of directors adopted a shareholder
rights plan. Under the plan, shareholders of record on September 30, 1997,
were assigned one right for each share of Nicor common stock held. The
rights will be exercisable only if a person acquires, or announces a tender
offer that would result in, ownership of 10 percent or more of Nicor's
common stock. If a person acquires beneficial ownership of 10 percent or
more of Nicor's common stock, all holders of rights other than the acquiring
person will be entitled to purchase common stock of Nicor at a 50 percent
discount to the market price. Nicor may redeem the rights at $.01 per right
at any time before someone becomes a 10 percent beneficial owner. The
rights expire on September 30, 2007.
Nicor Inc. Page 6
Notes to the Consolidated Financial Statements (Unaudited)
(Concluded)
CONTINGENCIES
The company is involved in legal or administrative proceedings before
various courts and agencies with respect to rates, taxes and other matters.
Current environmental laws require treatment of certain waste materials on
sites owned by Nicor that may have been generated by barge-cleaning
facilities previously owned and operated by certain discontinued businesses
of the company. The cost of evaluation and cleanup is currently estimated
to range from $5 million to $15 million. The company is evaluating whether
any of these costs will be recoverable from insurance or other sources.
Until the early 1950s, certain manufactured gas facilities were operated in
the Nicor Gas service territory. Manufactured gas is now known to have
created various by-products that may still be present at these sites.
Current environmental laws may require cleanup of these former manufactured
gas plant sites. The company has identified up to 40 properties in its
service territory believed to be the location of such sites. Of these
properties, Nicor Gas currently owns 15 and formerly owned or leased 13.
The remaining properties were never owned or leased by the company.
Information regarding preliminary reviews of the company's currently owned
and formerly owned or leased properties has been presented to the Illinois
Environmental Protection Agency. More detailed investigations are either
currently in progress or planned at many of these sites. The results of
continued testing and analysis should determine to what extent remediation
is necessary and may provide a basis for estimating any additional future
costs which, based on industry experience, could be significant. Since
1994, the company has been recovering these costs from its customers in
accordance with Ill.C.C. authorization.
At certain sites, the current owners are seeking to allocate cleanup costs
to former owners or lessees, including Nicor Gas.
On December 20, 1995, Nicor Gas filed suit in the Circuit Court of Cook
County against insurance carriers seeking recovery of environmental cleanup
costs of certain former manufactured gas plant sites. Presently, management
cannot predict the outcome of this lawsuit. Any recoveries from such
litigation or other sources will be flowed back to the company's customers.
Although unable to determine the outcome of these contingencies, management
believes that appropriate accruals have been recorded. Final disposition of
these matters is not expected to have a material impact on the company's
financial condition or results of operations.
Nicor Gas has entered into agreements to sell, subject to Ill.C.C. approval,
certain nonutility properties with a book value of approximately $6 million
for nearly $17 million. Sale closings are expected to take place over the
next two quarters.
Nicor Inc. Page 7
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations
OVERVIEW
The following discussion should be read in conjunction with the Management's
Discussion and Analysis section of the Nicor 1996 Annual Report on
Form 10-K.
Nicor's third quarter 1997 income from continuing operations increased to
$19.5 million from $15.1 million in the third quarter of 1996. Earnings per
common share from continuing operations for the quarter were 40 cents
compared with 30 cents a year ago. The increase was due primarily to
improved operating results and the positive impact of tax-related matters.
Income from continuing operations for the nine- and twelve-month periods
ended September 30, 1997, rose $2.6 million to $88.6 million and $2 million
to $123.8 million, respectively, from the corresponding 1996 periods. The
increase in each period was primarily attributable to the positive impact of
tax-related matters which more than offset lower operating results.
Earnings per common share from continuing operations were $1.81 and $2.52
compared with $1.71 and $2.42, respectively. Per share results also
benefited from the company's common stock buyback programs.
Operating income (loss) for the periods ended September 30 by business
segment was (millions):
Three months Nine months Twelve months
1997 1996 1997 1996 1997 1996
Gas distribution $ 35.0 $ 31.9 $151.4 $155.3 $211.6 $212.5
Shipping 5.2 4.5 16.5 17.0 21.7 25.1
Other (1.6) (1.1) (3.4) (2.9) (5.1) (4.3)
$ 38.6 $ 35.3 $164.5 $169.4 $228.2 $233.3
The following summarizes operating income comparisons by business segment:
- - Gas distribution operating income for the three-month period
increased $3.1 million due to higher deliveries of natural gas. For
the nine-month period, operating income decreased $3.9 million. The
decrease included the impact of a rate order that was implemented in
April 1996 which included rate design changes and a depreciation
rate increase. The rate design changes had a positive impact on 1996
results but a negative impact on first quarter 1997 results when
compared to the prior year. Operating income for the twelve-month
period decreased $.9 million due to higher depreciation.
- - Shipping operating income for the three-month period increased
$.7 million due to an increase in volumes shipped. For the nine-
and twelve-month periods, operating income decreased $.5 million and
$3.4 million, respectively, as higher operating costs more than
offset the positive impact of an increase in volumes shipped. All
periods were impacted by lower revenue per unit related in part to
changes in cargo mix.
Nicor Inc. Page 8
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations (Continued)
RESULTS OF OPERATIONS
Details of various financial and operating information by segment can be
found in the tables on pages 11 and 12. The following summarizes the major
changes in Nicor's revenues and expenses.
Operating revenues decreased $11.2 million for the three-month period and
increased $155.1 million and $281.7 million for the nine- and twelve-month
periods, respectively. In each period the change was due primarily to
variances in the gas distribution segment's natural gas supply costs, which
are recovered from customers.
Gas distribution margin, defined as operating revenues less cost of gas and
revenue taxes, which are both passed directly through to customers, is shown
in the following table for the periods ended September 30. For the three-
month period, margin increased due largely to higher deliveries of natural
gas.
Three months Nine months Twelve months
1997 1996 1997 1996 1997 1996
Gas distribution
margin (Millions) $ 88.1 $ 84.1 $356.7 $359.8 $499.5 $495.9
Margin per Mcf
delivered 1.35 1.35 .95 .93 .91 .89
Operating and maintenance expense increased $11.9 million and $22.1 million
for the nine- and twelve-month periods, respectively, due principally to
higher costs in the shipping segment caused primarily by increased volumes.
Depreciation expense increased in each period due primarily to the change in
the gas distribution composite depreciation rate and gas plant additions.
For further information on the change in the composite depreciation rate,
see Accounting Policies on page 5.
Other income increased in each period due primarily to a change in interest
on income tax adjustments.
Interest on debt increased in the twelve-month period due to increased
borrowing levels and higher interest rates.
Nicor Inc. Page 9
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations (Continued)
FINANCIAL CONDITION
Net cash flow from operating activities increased $196.4 million and
$224.4 million for the nine- and twelve-month periods, respectively, due
primarily to the timing of gas cost recoveries in the gas distribution
segment. Net cash flow from operations may swing sharply from one interim
period to another due to the seasonal nature of Nicor's businesses. The
company generally relies on short-term financing to meet temporary increases
in working capital needs.
Estimated 1997 capital expenditures in the shipping segment have been
revised to $15 million primarily as a result of a decision to delay the
construction of two vessels.
The company has committed a total of $18 million to two new investments. In
one transaction, Nicor will invest $10 million in a low income housing tax
credit fund. In another transaction, an $8 million investment was made to
acquire an equity interest in a cargo container leasing business.
Nicor and its gas distribution subsidiary maintain short-term credit
agreements with major domestic and foreign banks. At September 30, 1997,
these agreements, which serve as backup for the issuance of commercial
paper, totaled $280 million, and the company had $122.7 million of
commercial paper outstanding. At September 30, 1997, the unused lines of
credit under these credit agreements were $157.3 million.
In October 1997, Nicor Gas issued $50 million of 7-3/8% First Mortgage Bonds
due in 2027. The net proceeds from the sale of the bonds will be used,
together with other corporate funds, for the November 1997 retirement of $50
million of 9% First Mortgage Bonds due in 2019.
In June 1997, Nicor Gas sold $50 million of 6.75% First Mortgage Bonds due
in 2002. The net proceeds from the sale of the bonds replenished corporate
funds used for the February 1997 maturity of $25 million of 5-1/2% First
Mortgage Bonds and general corporate purposes.
In June 1997, Nicor completed the $50 million common stock buyback program
initiated in June 1996 and announced another $50 million common stock
repurchase program. Purchases under the new program will be made as market
conditions permit through open market transactions and to the extent cash
flow is available after other investment opportunities. During the first
nine months of 1997, the company purchased and retired 1,062,100 common
shares at an aggregate cost of $36.9 million.
Effective with the dividend paid on May 1, 1997, Nicor's quarterly dividend
on common stock was increased 6.1 percent to 35 cents per share.
Nicor Inc. Page 10
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations (Continued)
OTHER
New Accounting Pronouncement. In February 1997, the Financial Accounting
Standards Board issued Statement No. 128, Earnings per Share. This
statement simplifies the standards for computing earnings per share (EPS)
and makes them comparable to international EPS standards. This statement is
not expected to have a material impact on the company's EPS. For further
information, see New Accounting Pronouncement on page 5.
Sale of Properties. Nicor Gas has entered into agreements to sell, subject
to Ill.C.C. approval, certain nonutility properties with a book value of
approximately $6 million for nearly $17 million. Sale closings are expected
to take place over the next two quarters.
Rate Proceeding. In June 1997, the Third District Appellate Court of
Illinois upheld Nicor Gas' general rate increase granted by the Ill.C.C. on
April 3, 1996. For further information, see Rate Proceeding on page 5.
Pipeline Project. In July 1997, Nicor announced it has entered into
negotiations with Calgary-based TransCanada PipeLines Limited and
Minneapolis-based Northern States Power Company to become a 20 percent
partner in the Viking Voyager Gas Transmission project, a proposed
$1.2 billion pipeline designed to transport natural gas from the Canadian
border to the Midwest United States. Current plans are to begin seeking
regulatory and other approvals this fall, with operations to begin by late
1999.
Customer Select Pilot Program. On October 8, 1997, the Ill.C.C. approved
Nicor Gas' plans for a three-year pilot program called Customer Select that
will give more customers the opportunity to choose their natural gas
supplier. Currently over 10 percent of the company's commercial and
industrial customers purchase natural gas from other suppliers, and in the
Customer Select pilot program, the remaining 150,000 commercial and
industrial customers will be eligible to choose their suppliers. In the
first year, as many as 20,000 of those customers will be able to enroll in
the program. In the year 2000, up to 10,000 residential customers will be
eligible to sign up.
Shareholder Rights Plan. On September 9, 1997, the company's board of
directors adopted a shareholder rights plan. For further information, see
Shareholder Rights Plan on page 5.
<TABLE>
Nicor Inc. Page 11
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations (Continued)
OPERATING STATISTICS
Gas Distribution
Changes in weather can materially affect operating results. Operating revenues, deliveries, weather
statistics and other data are presented below.
<CAPTION>
Three months ended Nine months ended Twelve months ended
September 30 September 30 September 30
1997 1996 1997 1996 1997 1996
Operating revenues (Millions):
Sales
<S> <C> <C> <C> <C> <C> <C> <C>
Residential $ 93.4 $ 104.7 $ 776.3 $ 703.9 $1,112.6 $ 982.2
Commercial 21.1 23.9 219.8 187.2 314.5 256.9
Industrial 5.0 3.4 44.7 33.9 65.2 45.1
119.5 132.0 1,040.8 925.0 1,492.3 1,284.2
Transportation
Commercial 9.3 7.8 38.6 38.7 55.6 55.0
Industrial 10.8 10.7 34.9 40.4 48.5 57.6
20.1 18.5 73.5 79.1 104.1 112.6
Revenue taxes and other 11.5 10.5 100.8 94.2 130.6 118.4
$ 151.1 $ 161.0 $1,215.1 $1,098.3 $1,727.0 $1,515.2
Deliveries (Bcf):
Sales
Residential 15.7 15.5 157.5 166.3 238.2 249.3
Commercial 3.6 3.7 44.8 44.8 67.0 65.2
Industrial 1.5 .6 10.6 8.9 16.6 12.4
20.8 19.8 212.9 220.0 321.8 326.9
Transportation
Commercial 6.3 6.3 44.6 51.4 66.7 74.6
Industrial 37.9 36.1 119.6 114.9 158.9 158.7
44.2 42.4 164.2 166.3 225.6 233.3
65.0 62.2 377.1 386.3 547.4 560.2
Average gas cost per Mcf sold $ 2.45 $ 3.27 $ 3.57 $ 2.94 $ 3.40 $ 2.75
Weather statistics:
Degree days 51 84 4,046 4,088 6,387 6,414
Percent colder (warmer) than normal (42.0) (4.6) 2.8 3.9 4.4 5.1
Customers at end of period (Thousands):
Sales
Residential 1,690.2 1,670.3
Commercial 140.0 139.1
Industrial 11.1 11.4
1,841.3 1,820.8
Transportation
Commercial 18.7 17.9
Industrial 2.9 2.7
21.6 20.6
1,862.9 1,841.4
</TABLE>
<TABLE>
Nicor Inc. Page 12
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations (Concluded)
OPERATING STATISTICS (Concluded)
Shipping
<CAPTION>
Three months ended Nine months ended Twelve months ended
September 30 September 30 September 30
1997 1996 1997 1996 1997 1996
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Operating revenues (Millions) $ 51.7 $ 50.4 $ 153.0 $ 141.4 $ 206.6 $ 189.5
Operating income (Millions) $ 5.2 $ 4.5 $ 16.5 $ 17.0 $ 21.7 $ 25.1
TEUs shipped (Thousands)
Southbound 27.1 25.6 78.1 70.5 105.0 92.5
Northbound 3.7 4.0 10.9 10.8 14.4 14.8
Interisland 3.9 2.0 9.7 5.2 12.0 7.3
34.7 31.6 98.7 86.5 131.4 114.6
Revenue per TEU $ 1,440 $ 1,517 $ 1,491 $ 1,553 $ 1,511 $ 1,575
Ports served 27 28
Vessels owned 14 14
</TABLE>
Nicor Inc. Page 13
PART II - Other Information
Item 1.Legal Proceedings
For information concerning legal proceedings, see Rate Proceeding
and Contingencies in Notes to the Consolidated Financial Statements
beginning on page 5, which are incorporated herein by reference.
Item 2. Changes in Securities and Use of Proceeds
On September 9, 1997, the company's board of directors adopted a
shareholder rights plan. For further information, see Shareholder
Rights Plan on page 5, which is incorporated herein by reference.
Item 6. Exhibits and Reports on Form 8-K
(a) See Exhibit Index on page 15 filed herewith.
(b) On September 11, 1997, the company filed a report on Form 8-K for
the purpose of reporting a shareholder rights plan adopted by the
company's board of directors on September 9, 1997. A copy of the
Rights Agreement, form of letter to shareholders and press release
were filed as exhibits to the Form 8-K.
Nicor Inc. Page 14
Signature
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Nicor Inc.
Date November 13, 1997 By DAVID L. CYRANOSKI
David L. Cyranoski
Senior Vice President,
Secretary and Controller
Nicor Inc. Page 15
Exhibit Index
Exhibit
Number Description of Document
4.01 * Supplemental Indenture, dated October 15, 1997, of Nicor Gas to
Harris Trust and Savings Bank, Trustee, under Indenture dated as
of January 1, 1954. (File No. 1-7296, Form 10-Q for
September 1997, Nicor Gas, Exhibit 4.01.)
27.01 Financial Data Schedule.
* This exhibit has been previously filed with the Securities and Exchange
Commission and is incorporated herein by reference. The file number and
exhibit number are stated in parentheses in the description of such
exhibit.
<TABLE> <S> <C>
<ARTICLE> UT
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
CONSOLIDATED STATEMENT OF INCOME, THE CONSOLIDATED BALANCE SHEET AND THE
CONSOLIDATED STATEMENT OF CASH FLOWS AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> SEP-30-1997
<BOOK-VALUE> PER-BOOK
<TOTAL-NET-UTILITY-PLANT> 1,645
<OTHER-PROPERTY-AND-INVEST> 106
<TOTAL-CURRENT-ASSETS> 349
<TOTAL-DEFERRED-CHARGES> 0
<OTHER-ASSETS> 117
<TOTAL-ASSETS> 2,217
<COMMON> 121
<CAPITAL-SURPLUS-PAID-IN> 0
<RETAINED-EARNINGS> 608
<TOTAL-COMMON-STOCKHOLDERS-EQ> 729
6
0
<LONG-TERM-DEBT-NET> 521
<SHORT-TERM-NOTES> 0
<LONG-TERM-NOTES-PAYABLE> 29
<COMMERCIAL-PAPER-OBLIGATIONS> 123
<LONG-TERM-DEBT-CURRENT-PORT> 25
0
<CAPITAL-LEASE-OBLIGATIONS> 0
<LEASES-CURRENT> 0
<OTHER-ITEMS-CAPITAL-AND-LIAB> 784
<TOT-CAPITALIZATION-AND-LIAB> 2,217
<GROSS-OPERATING-REVENUE> 1,413
<INCOME-TAX-EXPENSE> 48
<OTHER-OPERATING-EXPENSES> 1,248
<TOTAL-OPERATING-EXPENSES> 1,296
<OPERATING-INCOME-LOSS> 117
<OTHER-INCOME-NET> 7
<INCOME-BEFORE-INTEREST-EXPEN> 124
<TOTAL-INTEREST-EXPENSE> 35
<NET-INCOME> 89
0
<EARNINGS-AVAILABLE-FOR-COMM> 89
<COMMON-STOCK-DIVIDENDS> 51
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