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 (Date of earliest event reported)
February 10, 1995
NORAM ENERGY CORP.
(Exact name of Registrant as specified in its charter)
Delaware 1-3751 72-0120530
(State or other (Commission (IRS Employer
jurisdiction File Number) Identification No.)
of incorporation)
NorAm Energy Corp.
1600 Smith
Houston, Texas 77002
(Address of principal executive offices) (Zip Code)
(713) 654-5699
(Registrant's telephone number, including area code)
Page 1 of 3 Pages<PAGE>
Item 5. Other Events
NorAm Energy Corp. hereby incorporates by reference herein
the following press release:
Press Release issued on February 10, 1995 and attached
hereto as Exhibit 99.
Item 7. Financial Statement, Pro Forma Financial Information
and Exhibits
(a) Financial Statements -- None.
(b) Pro Forma Financial Information -- None.
(c) Exhibit -- EX-99.
Page 2 of 3 Pages<PAGE>
Signature
Pursuant to the requirements of the Securities Exchange Act
of 1934, the Registrant has duly caused this report on Form 8-K
to be signed on its behalf by the undersigned hereunto duly
authorized.
NORAM ENERGY CORP.
By /s/ Jack W. Ellis, II
Name: Jack W. Ellis, II
Title: Vice President &
Controller
Date: February 17, 1995
Page 3 of 3 Pages<PAGE>
EXHIBIT 99
NORAM ENERGY REPORTS FOURTH QUARTER EARNINGS
Houston, TX -- February 10, 1995 -- NorAm Energy Corp.
reported financial results for the fourth quarter and year ended
December 31, 1994. Income from continuing operations for the
fourth quarter was $23.8 million as compared to a loss of $4.2
million in 1993. After preferred dividends, income from
continuing operations available to common shareholders was $21.9<PAGE>
million, or $0.18 per share, as compared to a loss of $6.1
million, or $0.05 per share in 1993. Included in the fourth
quarter 1993 loss was a pre-tax charge of $34.2 million
(approximately $0.17 per share) from a contract termination.
For the full year of 1994, income from continuing operations
was $51.3 million compared to $39.9 million in 1993. After
preferred dividends, income from continuing operations available
to common shareholders was $43.5 million, or $0.36 per share,
compared to $32.1 million, or $0.26 per share in the prior year.
In addition to the contract termination charge, 1993 earnings
included pre-tax gains totaling $41.5 million ($0.15 per share)
from the sales of Louisiana Intrastate Gas Company and the
Nebraska distribution properties of Minnegasco.
In the fourth quarter of 1994, NorAm Energy incurred an
after-tax loss from discontinued operations of $2.1 million
($0.02 per share) related to University Savings Association and
the litigation brought against the Company by the Resolution
Trust Corporation, which was settled during the quarter.
For the full year of 1994, operating income from Pipeline,
which includes NorAm's interstate pipeline, gathering and
marketing companies, increased 38.2% to $108.1 million from $78.2
million in 1993. In the fourth quarter, Pipeline's operating
income increased 67.7% to $27.0 million compared to $16.1 million
in the same period in 1993. These earnings gains were due, in<PAGE>
part, to improved margins attributable to recent initiatives
including enhancements to the Company's Perryville Hub facilities
and approximately $7 million resulting from the final approval of
two pipeline rate cases.
Operating income for 1994 from distribution operations
decreased to $163.2 million from $174.8 million in 1993. Higher
revenues from rate increases and increased industrial sales were
more than offset by the effects of warm weather at each of the
distribution divisions. For the fourth quarter, operating income
was $56.0 million compared to $62.0 million in 1993. Each of the
Company's Distribution divisions recorded warmer than normal
temperatures during the fourth quarter: Arkla, 17% warmer than
normal; Entex, 33% warmer than normal; and Minnegasco, 16% warmer
than normal. The Company estimates that the departure from
normal weather during the fourth quarter reduced operating income
by approximately $14.5 million, or after tax earnings by $0.07
per share.
Despite significantly lower levels of debt than last year,
interest expense for the quarter increased $0.3 million due to
higher short-term interest rates. Interest expense for the
fourth quarter of 1994 was $42.4 million compared to $42.1
million in 1993.
"One of our major objectives for 1994 was to continue to
close the earnings gap between Pipeline's actual and allowed<PAGE>
return on its assets. We made notable progress in this area as
evidenced by the 38% improvement in Pipeline operating income
during 1994. More telling is the fact that over the last two
years, our turnaround efforts and improvement in market
conditions have led to a 157% increase in Pipeline operating
income from an adjusted $42 million in 1992 to $108 million in
1994." stated Milt Honea, Chairman, President, and CEO. "While
we do not anticipate being able to continue this trend of 30-
plus% per year earnings improvement at Pipeline, we do believe,
near term, we have further room for earnings improvement in
Pipeline through our recent deregulated gathering business and
our unregulated marketing businesses."
"Another major objective for this past year was to continue
to reduce our debt and strengthen our balance sheet. Our strong
cash flows during 1994 allowed us to retire over $130 million in
debt, which surpassed our goals." Honea continued.
"Our third major objective for 1994 was to continue to
preserve and build our strong base of earnings and cash flow from
our distribution businesses. We did have a successful year in
achieving rate increases in a number of jurisdictions and in
managing our operating costs, but this success was obscured by
the warm weather."
"We are pleased with our progress during 1994, but are
frustrated that this progress has not been reflected in a higher<PAGE>
stock price. Improving shareholder value remains our number one
objective, and we are redoubling our efforts toward that end in
1995."
NorAm Energy Corp. is the nation's third largest natural gas
utility serving 2.7 million customers through its Entex, Arkla
and Minnegasco operating divisions. NorAm Energy is also a major
natural gas pipeline and energy marketer providing supply,
gathering, storage and transportation services. NorAm Energy
trades under the "NAE" ticker symbol.
95-05
##<PAGE>
CONTACT INVESTOR RELATIONS
Randy Fowler (713) 654-7502
NORAM ENERGY CORP. AND SUBSIDIARIES
(UNAUDITED)
(in thousands of dollars except per share amounts)
QUARTER ENDED DECEMBER 31 1994 1993 (3)
Operating Revenues $ 713,081 $ 868,026
Income From Continuing Operations Before Income Taxes $ 37,758 $ 1,558
Income (Loss) From Continuing Operations $ 23,836 $ (4,218)
Loss from Discontinued Operations, Less Taxes (1) (2,102) -
Income (Loss) Before Extraordinary Item 21,734 (4,218)
Extraordinary Item, Less Taxes (2) (606) (381)
Net Income (Loss) 21,128 (4,599)
Preferred Dividend Requirement 1,950 1,950
Balance Available to Common Stock $ 19,178 $ (6,549)
Per Share Data:
Income (Loss) Before Extraordinary Item $ 0.18 $ (0.05)
Loss from Discontinued Operations, Less Taxes (0.02) -
Extraordinary Item, Less Taxes 0.00 0.00
Net Income (Loss) $ 0.16 $ (0.05)
Weighted Average Common Shares Outstanding (000's) 122,492 122,357
TWELVE MONTHS ENDED DECEMBER 31
Operating Revenues $2,801,446 $2,949,565
Income From Continuing Operations Before Income Taxes $ 85,663 $ 86,416
Income From Continuing Operations $ 51,291 $ 39,935
Loss from Discontinued Operations, Less Taxes (1) (2,102) -
Income Before Extraordinary Item 49,189 39,935
Extraordinary Item, Less Taxes (2) (1,123) (3,848)
Net Income 48,066 36,087
Preferred Dividend Requirement 7,800 7,800
Balance Available to Common Stock $ 40,266 $ 28,287
Per Share Data:
Income From Continuing Operations $ 0.36 $ 0.26
Loss from Discontinued Operations, Less Taxes (0.02) -
Extraordinary Item, Less Taxes (0.01) (0.03)
Net Income $ 0.33 $ 0.23
Weighted Average Common Shares Outstanding (000's) 122,424 122,305
(1) Principally settlement of litigation related to University Savings
Association brought against the Company by the Resolution Trust
Corporation.
(2) Loss on reacquisition of debt.
(3) Income from continuing operations for 1993 includes a fourth quarter
pre-tax charge of approximately $34.2 million related to the termination
of certain agreements with Samson Resources Inc. and pre-fourth quarter,
pre-tax gains of approximately $41.5 million related to the sale of
certain properties.
NORAM ENERGY CORP. OPERATING STATISTICS
GAS THROUGHPUT
Fourth Quarter Year-to-Date
1994 1993 1994 1993
(million MMBtu) (million MMBtu)
PIPELINE
NGT
Sales 6.9 11.3 40.7 52.3
Transported 135.1 158.9 567.3 585.5
Less: Elimination (6.2) (13.9) (37.4) (20.3)
Total Throughput 135.8 156.3 570.6 617.5
MRT
Sales 8.1 9.3 25.6 62.8
Transported 73.1 80.9 307.2 258.7
Less: Elimination (8.1) (3.9) (25.6) (3.9)
Total Throughput 73.1 86.3 307.2 317.6
NES
Sales 81.9 68.8 317.9 244.7
Transported - - - -
Total Throughput 81.9 68.8 317.9 244.7
PIPELINE CONSOLIDATED
Sales 65.3 41.5 228.1 174.8
Transported 198.4 223.4 831.8 780.1
Less: Elimination (14.3) (17.8) (63.0) (24.2)
Total Throughput 249.4 247.1 996.9 930.7
(BCF) (BCF)
DISTRIBUTION
ARKLA
Sales 23.7 29.3 84.4 89.8
Transported 7.5 8.6 31.8 36.6
Total Throughput 31.2 37.9 116.2 126.4
ENTEX
Sales 64.2 64.7 242.1 221.1
Transported 8.8 9.0 31.5 31.8
Total Throughput 73.0 73.7 273.6 252.9
MINNEGASCO
Sales 37.4 43.4 129.0 131.3
Transported 3.0 0.4 5.4 7.4
Total Throughput 40.4 43.8 134.4 138.7
OPERATING INCOME BY BUSINESS UNIT (Unaudited)
(millions of dollars)
Fourth Quarter Year-to-Date
1994 1993 1994 1993
Operating Income(Loss) by Business Unit
Distribution $ 56.0 $ 62.0 $ 163.2 $ 174.8
Pipeline (1) 27.0 (18.1)(2) 108.1 44.0 (2)
LIG (3) - - - 5.6
Other - 2.0 (5.3) (17.4)
Total Operating Income 83.0 45.9 266.0 207.0
Interest Expense, Net 42.4 42.1 169.4 172.4
Other (Income) Expense 2.8 2.2 10.9 (51.8)(4)
Income From Continuing Operations
Before Income Taxes 37.8 1.6 85.7 86.4
Provision for Income Taxes 14.0 5.8 34.4 46.5
Income(Loss) From Continuing Operations 23.8 (4.2) 51.3 39.9
Discontinued Operations, Less Taxes (5) (2.1) - (2.1) -
Extraordinary Item, Less Taxes (6) (0.6) (0.4) (1.1) (3.8)
Net Income(Loss) 21.1 (4.6) 48.1 36.1
Preferred Dividend Requirement 1.9 1.9 7.8 7.8
Balance Available to Common Stock $ 19.2 $ (6.5) $ 40.3 $ 28.3
Per Share Data:
Continuing Operations $ 0.18 $ (0.05) $ 0.36 $ 0.26
Discontinued Operations, Less Taxes (0.02) - (0.02) -
Extraordinary Item, Less Taxes 0.00 0.00 (0.01) (0.03)
Earnings(Loss) Per Common Share $ 0.16 $ (0.05) $ 0.33 $ 0.23
Average Common Shares
Outstanding (in thousands) 122,492 122,357 122,424 122,305
(1) Excludes LIG.
(2) Includes a contract termination charge of $34.2 million.
(3) LIG was sold effective June 30, 1993.
(4) Includes $23.8 million gain from the sale of the Nebraska distribution
properties and $17.7 million gain from the sale of LIG.
(5) Principally settlement of litigation related to University Savings
Association brought against the Company by the Resolution Trust
Corporation.
(6) Loss on reacquisition of debt.
