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Previous: NORTHEAST UTILITIES SYSTEM, U-1/A, EX-5, 2000-06-29 |
Next: NORTHEAST UTILITIES SYSTEM, U-1/A, EX-99.2, 2000-06-29 |
Yankee Gas Services Company
Pro Forma Impacts of Proposed Transactions
(Thousands of Dollars)
<TABLE>
I. BALANCE SHEET IMPACT
<S> <C> <C> <C>
Pro Forma Pro Forma
Common Common
Actual Stock Stock Pro Forma
31-Mar-00 Dividend Repurchase 31-Mar-00
Common Shares $ 5 $ 5
Paid in Capital 460,123 (119,579)(B) 340,545
Retained Earnings 3,129 (15,050)(A) (11,921)
Total Common Equity 463,257 (15,050) (119,579) 328,629
Long-Term Debt 159,000 - 159,000
Short-Term Debt 35,000 15,050 (A) 119,579 (B) 169,629
Obligations Under Capital Leases - -
Total Capitalization $ 657,257 $ - $ - $ 657,257
Total Common Equity to Total Capitalization 70.5% 50.0%
(A) Pay common dividend up to the limitation of 80% of Gross Earnings (earnings before the
amortization of merger goodwill) on a rolling five-year average basis. Common dividends are
funded through the issuance of short-term debt.
80% TEST WORKSHEET:
80% of
1-Yr Rolling 5-Yr.
Gross Earnings Avg. G/E
1996 $ 19,441
1997 19,739
1998 16,978
1999 15,907
Projected 2000 dividend 21,996 * $ 15,050
*Projected 2000 Gross Earnings:
Pre merger:
Jan 2000 $ 6,850
Feb 2,471
Actual March 2000 3,756
Budget Apr-Dec 2000 8,919
$ 21,996
(B) Repurchase sufficient amount of common stock from YES that allows Yankee Gas to reduce its common
equity ratio to 50%. The stock repurchase is funded through the issuance of additional long-term
debt.
II. INCOME STATEMENT IMPACT
Annual Increase in
Principal Interest Rate Interest Expense
LTD Interest $ 119,579 8.125% $ 9,716
STD Interest $ 15,050 7.250% 1,091
subtotal 10,807
Income taxes (4,323)
Decrease (increase) in annual net income 6,484
</TABLE>
Yankee Energy System, Inc. Consolidated
Pro Forma Impacts of Proposed Transactions
(Thousands of Dollars)
<TABLE>
I. BALANCE SHEET IMPACT
<S> <C> <C> <C>
Pro Forma Pro Forma
Common Common
Actual Stock Stock Pro Forma
31-Mar-00 Dividend Repurchase 31-Mar-00
Common Shares $ - $ -
Paid in Capital 481,878 (114,809) (B) 367,069
Retained Earnings 1,840 (15,050) (A) (13,210)
Total Common Equity 483,718 (15,050) (114,809) 353,859
Long-Term Debt 164,000 - 119,579 (B) 283,579
Short-Term Debt 60,000 15,050 (A) (4,770)(B) 70,280
Obligations Under Capital Leases - -
Total Capitalization $ 707,718 $ - - $ 707,718
Total Common Equity to Total Capitalization 68.3% 50.0%
(A) Pay common dividend from proceeds of pro forma Yankee Gas common dividend.
(B) Repurchase sufficient amount of common stock from NU that allows YES to reduce its consolidated
common equity ratio to 50%. The stock repurchase is funded from the proceeds of the Yankee Gas
stock repurchase; excess cash is used to reduce YES (parent) short-term debt.
II. INCOME STATEMENT IMPACT
Annual Increase in
Principal Interest Rate Interest Expense
LTD Interest $ 119,579 8.125% $ 9,716
STD Interest $ 10,280 7.250% 745
subtotal 10,461
Income taxes (4,184)
Decrease (increase) in annual net income 6,277
</TABLE>
Northeast Utilities Consolidated
Pro Forma Impacts of Proposed Transactions
(Thousands of Dollars)
<TABLE>
I. BALANCE SHEET IMPACT
<S> <C> <C> <C>
Actual Pro Forma Pro Forma
31-Mar-00 Adjustments 31-Mar-00
Common Shares $ 742,731 $ 742,731
Paid in Capital 979,176 979,176
Retained Earnings 642,092 642,092
Total Common Equity 2,363,999 2,363,999
Preferred Stock 255,989 255,989
Long-Term Debt 2,543,989 119,579 (A) 2,663,568
Long-Term Debt and Preferred Stock - Current Portion 346,123 346,123
Short-Term Debt 984,000 10,280 (B) 864,421
(129,859)(C)
Obligations Under Capital Leases 168,411 168,411
Total Capitalization $ 6,662,511 $ - $ 6,662,511
Total Common Equity to Total Capitalization 35.5% 35.5%
(A) Issue YES Consolidated long-term debt to fund common stock repurchase.
(B) Issue YES Consolidated short-term debt to fund common stock dividend.
(C) Retire portion of NU Parent term note from proceeds of YES common stock repurchase and common
dividend.
II. INCOME STATEMENT IMPACT
Annual Increase in
Principal Interest Rate Interest Expense
LTD Interest - Yankee Gas $ 119,579 8.125% $ 9,716
STD Interest - Yankee Consolidated $ 10,280 7.250% 745
NU Parent Term Note Interest $(129,859) 8.125% (10,551)
subtotal (90)
Income taxes 36
Decrease (increase) in annual net income $ (54)
</TABLE>
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