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 June 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 July 31, 1997, were
48,581,920.
NICOR Inc. Page i
Table of Contents
Page
Part I. Financial Information
Item 1. Financial Statements (Unaudited) 1
Consolidated Statement of Income -
Three, Six and Twelve Months Ended
June 30, 1997 and 1996 2
Consolidated Statement of Cash Flows -
Six and Twelve Months Ended
June 30, 1997 and 1996 3
Consolidated Balance Sheet -
June 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 4. Submission of Matters to a Vote of
Security Holders 13
Item 6. Exhibits and Reports on Form 8-K 14
Signature 15
Exhibit Index 16
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
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 Six months ended Twelve months ended
June 30 June 30 June 30
1997 1996 1997 1996 1997 1996
<S> <C> <C> <C> <C> <C> <C>
Operating revenues $ 303.7 $ 336.5 $1,203.7 $1,037.4 $2,017.0 $1,660.8
Operating expenses
Cost of gas 122.8 160.9 755.7 602.0 1,198.5 908.1
Operating and maintenance 81.9 77.4 162.6 153.1 336.2 304.1
Depreciation 23.0 21.3 75.2 70.7 129.8 118.5
Taxes, other than income taxes 23.4 24.9 84.4 77.5 127.7 114.3
251.1 284.5 1,077.9 903.3 1,792.2 1,445.0
Operating income 52.6 52.0 125.8 134.1 224.8 215.8
Other income (expense)
Interest income 1.2 .5 1.7 .9 2.3 1.9
Other, net 1.2 (1.7) 2.9 (1.8) 6.7 .9
2.4 (1.2) 4.6 (.9) 9.0 2.8
Income before interest on debt
and income taxes 55.0 50.8 130.4 133.2 233.8 218.6
Interest on debt, net of
amounts capitalized 10.5 10.6 23.8 22.3 49.3 43.2
Income before income taxes 44.5 40.2 106.6 110.9 184.5 175.4
Income taxes 15.8 14.8 37.4 40.0 65.1 62.7
Income from continuing operations 28.7 25.4 69.2 70.9 119.4 112.7
Income from discontinued
operations, net of income taxes - 15.0 - 15.0 - 15.0
Net income 28.7 40.4 69.2 85.9 119.4 127.7
Dividends on preferred stock - .1 .2 .2 .3 .4
Earnings applicable to
common stock $ 28.7 $ 40.3 $ 69.0 $ 85.7 $ 119.1 $ 127.3
Average shares of common
stock outstanding 48.8 50.1 49.1 50.2 49.4 50.3
Earnings per average share
of common stock
Continuing operations $ .59 $ .50 $ 1.41 $ 1.41 $ 2.41 $ 2.23
Discontinued operations - .30 - .30 - .30
$ .59 $ .80 $ 1.41 $ 1.71 $ 2.41 $ 2.53
Dividends declared per share
of common stock $ .35 $ .33 $ .70 $ .66 $ 1.36 $ 1.30
<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>
Six months ended Twelve months ended
June 30 June 30
1997 1996 1997 1996
Operating activities
<S> <C> <C> <C> <C>
Net income $ 69.2 $ 85.9 $ 119.4 $ 127.7
Adjustments to reconcile net income to net
cash flow provided from operating activities:
Depreciation 75.2 70.7 129.8 118.5
Deferred income tax expense (benefit) (6.3) (13.7) 6.0 1.4
Change in working capital items and other:
Receivables, less allowances 162.7 91.0 (6.6) (71.1)
Gas in storage 104.0 42.8 6.0 (8.5)
Deferred/accrued gas costs 83.4 (24.5) 65.5 (53.4)
Accounts payable (83.7) (66.0) 7.8 15.7
Temporary LIFO liquidation 56.6 12.0 44.6 (18.7)
Other 2.7 13.5 (15.8) (13.6)
Net cash flow provided from operating activities 463.8 211.7 356.7 98.0
Investing activities
Capital expenditures (46.8) (50.5) (113.9) (145.4)
Short-term investments (12.3) 8.4 (13.8) 1.1
Other (4.9) (1.9) (4.8) (.1)
Net cash flow used for investing activities (64.0) (44.0) (132.5) (144.4)
Financing activities
Net proceeds from issuing long-term debt 49.7 - 124.0 72.0
Disbursements to retire long-term debt (25.0) (50.0) (25.0) (112.5)
Short-term borrowings (repayments), net (292.0) (80.6) (118.2) 115.7
Dividends paid (33.7) (32.8) (66.9) (65.2)
Disbursements to reacquire stock (30.6) (4.9) (61.4) (13.4)
Other - .4 5.4 1.7
Net cash flow used for financing activities (331.6) (167.9) (142.1) (1.7)
Net increase (decrease) in cash and cash equivalents 68.2 (.2) 82.1 (48.1)
Cash and cash equivalents, beginning of period 20.5 6.8 6.6 54.7
Cash and cash equivalents, end of period $ 88.7 $ 6.6 $ 88.7 $ 6.6
Supplemental information
Income taxes paid, net of refunds $ 25.5 $ 39.1 $ 61.6 $ 54.4
Interest paid, net of amounts capitalized 24.3 23.1 47.5 44.1
<F1>
The accompanying notes are an integral part of this statement.
</TABLE>
<TABLE>
NICOR Inc. Page 4
Consolidated Balance Sheet (Unaudited)
(Millions)
<CAPTION>
June 30 December 31 June 30
Assets 1997 1996 1996
Current assets
<S> <C> <C> <C> <C> <C> <C>
Cash and cash equivalents $ 88.7 $ 20.5 $ 6.6
Short-term investments, at cost
which approximates market 25.0 12.7 11.2
Receivables, less allowances of $10.8,
$7.7 and $8.8, respectively 177.3 340.0 170.7
Gas in storage, at last-in, first-out (LIFO) cost 14.2 118.2 20.2
Deferred gas costs - 51.1 33.2
Other 20.4 30.9 29.4
325.6 573.4 271.3
Property, plant and equipment, at cost
Gas distribution 2,993.6 2,957.3 2,923.4
Shipping 236.5 233.9 233.5
Other .6 1.5 .8
3,230.7 3,192.7 3,157.7
Less accumulated depreciation 1,489.2 1,420.8 1,397.9
1,741.5 1,771.9 1,759.8
Other assets 102.8 93.3 90.0
$ 2,169.9 $ 2,438.6 $ 2,121.1
Liabilities and Capitalization
Current liabilities
Long-term obligations due within one year $ 25.0 $ 25.0 $ 25.2
Short-term borrowings - 292.0 118.2
Accounts payable 250.2 333.9 242.4
Temporary LIFO liquidation 56.6 - 12.0
Accrued gas costs 32.3 - -
Other 39.6 48.9 53.1
403.7 699.8 450.9
Deferred credits and other liabilities
Deferred income taxes 215.2 211.6 201.7
Regulatory income tax liability 82.6 83.8 85.1
Unamortized investment tax credits 47.3 48.4 49.8
Other 136.2 139.9 145.2
481.3 483.7 481.8
Capitalization
Long-term debt 543.3 518.0 443.9
Preferred stock
Redeemable 6.2 7.4 8.6
Nonredeemable .1 .1 .1
Common equity
Common stock 121.6 123.7 125.3
Paid-in capital - 23.8 45.7
Retained earnings 613.7 582.1 564.8
1,284.9 1,255.1 1,188.4
$ 2,169.9 $ 2,438.6 $ 2,121.1
<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. 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.
Gas in Storage. Gas in storage injections and withdrawals are valued using
the last-in, first-out (LIFO) method on a calendar-year basis. For interim
periods, the difference between current replacement cost and the LIFO cost
for quantities of gas temporarily withdrawn from storage is recorded in cost
of gas as a temporary LIFO liquidation.
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 Northern Illinois 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 Northern Illinois 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 June 1997, Northern Illinois 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.
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.
NICOR Inc. Page 6
Notes to the Consolidated Financial Statements (Unaudited)
(Concluded)
CONTINGENCIES (Concluded)
Until the early 1950s, certain manufactured gas facilities were operated in
the Northern Illinois 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, Northern Illinois 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 Northern Illinois Gas.
On December 20, 1995, Northern Illinois 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.
Northern Illinois 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 few 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 second quarter 1997 income from continuing operations increased to
$28.7 million from $25.4 million in the second quarter of 1996 due primarily
to the impact of tax-related matters. Earnings per common share from
continuing operations for the quarter were $.59 compared with $.50 a year
ago. Common stock buyback programs, which reduced average shares
outstanding by about 3 percent, also had a positive impact on per share
results. In the second quarter of 1996, NICOR made a positive after-tax
adjustment of $15 million to its reserve for discontinued operations.
Including this adjustment, NICOR's second quarter 1996 net income was
$40.4 million and earnings per common share were $.80.
Income from continuing operations for the six months ended June 30 decreased
to $69.2 million in 1997 from $70.9 million a year ago. The decrease was
due largely to lower operating results which more than offset the positive
impact of tax-related matters. Earnings per common share from continuing
operations were $1.41, unchanged from a year ago. Per share results
benefited from the company's common stock buyback programs. Including the
previously mentioned adjustment to discontinued operations, net income for
the six months ended June 30, 1996, was $85.9 million and earnings per
common share were $1.71.
Income from continuing operations for the twelve months ended June 30 rose
to $119.4 million in 1997 from $112.7 million a year ago. Earnings per
common share from continuing operations were $2.41 compared with $2.23 a
year ago. The increase was primarily attributable to higher operating
results in the gas distribution segment. Including the previously mentioned
adjustment to discontinued operations, NICOR's net income for the twelve
months ended June 30, 1996, was $127.7 million and earnings per common share
were $2.53.
Operating income (loss) for the periods ended June 30 by business segment
was (millions):
Three months Six months Twelve months
1997 1996 1997 1996 1997 1996
Gas distribution $ 48.0 $ 47.6 $116.4 $123.5 $208.4 $195.0
Shipping 5.7 5.7 11.3 12.5 21.0 25.2
Other (1.1) (1.3) (1.9) (1.9) (4.6) (4.4)
$ 52.6 $ 52.0 $125.8 $134.1 $224.8 $215.8
NICOR Inc. Page 8
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations (Continued)
OVERVIEW (Concluded)
The following summarizes operating income comparisons by business segment:
- - Gas distribution operating income for the six-month period decreased
$7.1 million. The decrease included the impact of a rate order that
was implemented April 1996 which included rate design changes and a
depreciation rate increase. The rate design changes shifted
revenues from cold-weather quarters to warm-weather quarters which
had a positive impact on second and third quarter results, but a
negative impact on the first quarter. For the twelve-month period,
operating income increased $13.4 million due primarily to the impact
of the 1996 rate order.
- - Shipping operating income for the six- and twelve-month periods
decreased $1.2 million and $4.2 million, respectively, as higher
operating costs more than offset the positive impact of increased
volumes shipped into new ports the company began serving last year.
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 $32.8 million for the three-month period and
increased $166.3 million and $356.2 million for the six- and twelve-month
periods, respectively. In each period the change was due primarily to 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 June 30. For the six-month
period, margin decreased due primarily to lower deliveries and the impact of
last year's rate order. Deliveries were adversely affected by such factors
as weather and a reduction in transportation service to other utilities.
For the twelve-month period, both margin and margin per Mcf delivered
increased due largely to the impact of the April 1996 rate order.
Three months Six months Twelve months
1997 1996 1997 1996 1997 1996
Gas distribution
margin (Millions) $109.1 $106.8 $268.7 $275.7 $495.5 $476.1
Margin per Mcf
delivered 1.12 1.13 .86 .85 .91 .85
NICOR Inc. Page 9
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations (Continued)
RESULTS OF OPERATIONS (Concluded)
Operating and maintenance expense increased $4.5 million, $9.5 million and
$32.1 million for the three-, six- 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 six- and twelve-month periods due
primarily to higher borrowing levels.
The effective income tax rate decreased in each period as a result of
benefits related to the reduction of contingent liabilities.
FINANCIAL CONDITION
Net cash flow from operating activities increased $252.1 million and
$258.7 million for the six- 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.
In the second quarter of 1997, estimated 1997 capital expenditures in the
shipping segment were revised to $20 million from $35 million. The revision
results from the decision to delay the planned construction of two vessels.
The company has committed a total of $18 million to two investments. In one
transaction, NICOR will invest $10 million in a low income housing tax
credit fund. In another transaction, an $8 million investment is being 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 June 30, 1997, these
agreements, which serve as backup for the issuance of commercial paper,
totaled $278 million. The company had no outstanding commercial paper at
June 30, 1997.
In June 1997, Northern Illinois 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.
NICOR Inc. Page 10
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations (Continued)
FINANCIAL CONDITION (Concluded)
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
six months of 1997, the company purchased and retired 841,600 common shares
at an aggregate cost of $28.8 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.
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. Northern Illinois 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 few quarters.
Rate Proceeding. In June 1997, the Third District Appellate Court of
Illinois upheld Northern Illinois 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 agreement on a letter of
intent to join Calgary-based TransCanada PipeLines Limited (TransCanada) and
Minneapolis-based Northern States Power Company (NSP) as a sponsor of the
Viking Voyageur Gas Transmission project, a $1 billion pipeline designed to
transport natural gas from the Canadian border to the Midwest United States.
By signing a letter of intent, NICOR has agreed to continue to work toward a
definitive agreement with TransCanada and NSP that would make NICOR a
20 percent partner in the venture. Current plans are to begin seeking
regulatory and other approvals this fall, with operations to begin by late
1999.
<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 Six months ended Twelve months ended
June 30 June 30 June 30
1997 1996 1997 1996 1997 1996
Operating revenues (Millions):
Sales
<S> <C> <C> <C> <C> <C> <C>
Residential $ 148.4 $ 181.7 $ 683.0 $ 599.2 $1,123.9 $ 949.5
Commercial 39.8 45.9 198.7 163.3 317.3 248.6
Industrial 11.2 7.4 39.6 30.5 63.6 43.3
199.4 235.0 921.3 793.0 1,504.8 1,241.4
Transportation
Commercial 11.0 10.6 29.2 31.0 54.0 53.4
Industrial 10.3 11.7 24.1 29.6 48.4 59.7
21.3 22.3 53.3 60.6 102.4 113.1
Revenue taxes and other 23.3 27.4 89.3 83.6 129.7 117.1
$ 244.0 $ 284.7 $1,063.9 $ 937.2 $1,736.9 $1,471.6
Deliveries (Bcf):
Sales
Residential 35.0 35.8 141.7 150.8 238.0 249.2
Commercial 10.1 9.2 41.2 41.1 67.1 65.1
Industrial 4.1 1.6 9.1 8.3 15.7 12.2
49.2 46.6 192.0 200.2 320.8 326.5
Transportation
Commercial 10.1 11.3 38.4 45.2 66.7 74.8
Industrial 37.9 36.7 81.7 78.8 157.0 161.2
48.0 48.0 120.1 124.0 223.7 236.0
97.2 94.6 312.1 324.2 544.5 562.5
Average gas cost per Mcf sold $ 2.30 $ 3.29 $ 3.69 $ 2.91 $ 3.46 $ 2.68
Weather statistics:
Degree days 893 801 3,995 4,004 6,420 6,423
Percent colder than normal 29.8 16.4 3.8 4.1 5.0 5.2
Customers at end of period (Thousands):
Sales
Residential 1,690.9 1,668.3
Commercial 141.0 140.5
Industrial 11.4 11.5
1,843.3 1,820.3
Transportation
Commercial 18.6 17.8
Industrial 2.8 2.6
21.4 20.4
1,864.7 1,840.7
</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 Six months ended Twelve months ended
June 30 June 30 June 30
1997 1996 1997 1996 1997 1996
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Operating revenues (Millions) $ 50.9 $ 46.3 $ 101.3 $ 91.0 $ 205.3 $ 177.6
Operating income (Millions) $ 5.7 $ 5.7 $ 11.3 $ 12.5 $ 21.0 $ 25.2
TEUs shipped (Thousands)
Southbound 26.1 23.9 51.0 44.9 103.5 85.6
Northbound 3.9 3.6 7.2 6.8 14.7 14.7
Interisland 3.6 1.5 5.8 3.2 10.1 6.1
33.6 29.0 64.0 54.9 128.3 106.4
Revenue per TEU $ 1,460 $ 1,514 $ 1,520 $ 1,574 $ 1,532 $ 1,591
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 4. Submission of Matters to a Vote of Security Holders
The Annual Meeting of Stockholders of the company was held on
April 17, 1997, for the purpose of electing the Board of Directors
and approving the NICOR Inc. 1997 Long-Term Incentive Plan.
Proxies for the meeting were solicited pursuant to Section 14(a) of
the Securities Exchange Act of 1934 and there was no solicitation
in opposition to management's solicitation. The results of the
voting as reported below are for shares eligible to vote as of the
record date, February 17, 1997. There were no "broker nonvotes."
All of management's nominees for directors as listed in the proxy
statement were elected as indicated below:
Shares Shares
Voted Voted
NOMINEE FOR WITHHELD
Robert M. Beavers, Jr. 43,431,354 402,334
Bruce P. Bickner 35,518,699 7,595,249
John H. Birdsall, III 43,433,405 403,415
W.H. Clark 43,341,670 460,597
Thomas L. Fisher 43,459,517 376,720
John E. Jones 43,406,435 421,630
Dennis J. Keller 43,465,838 380,983
Charles S. Locke 43,397,846 427,192
Sidney R. Petersen 43,382,026 437,071
Daniel R. Toll 43,322,659 484,711
Patricia A. Wier 43,429,041 411,645
The proposal to approve the NICOR Inc. 1997 Long-Term Incentive
Plan was approved by the following vote:
Shares Shares Shares
Voted Voted Voted
FOR AGAINST ABSTAINING
39,315,868 2,928,307 799,844
NICOR Inc. Page 14
PART II - Other Information (Concluded)
Item 6. Exhibits and Reports on Form 8-K
(a) See Exhibit Index on page 16 filed herewith.
(b) The company did not file a report on Form 8-K during the second
quarter of 1997.
NICOR Inc. Page 15
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 August 8, 1997 By DAVID L. CYRANOSKI
David L. Cyranoski
Senior Vice President,
Secretary and Controller
NICOR Inc. Page 16
Exhibit Index
Exhibit
Number Description of Document
4.01 * Supplemental Indenture, dated June 1, 1997, of Northern Illinois
Gas Company to Harris Trust and Savings Bank, Trustee, under
Indenture dated as of January 1, 1954. (File No. 1-7296,
Form 10-Q for June 1997, Northern Illinois Gas Company,
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.
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THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
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