<PAGE>
CENTRAL OHIO COAL COMPANY
QUARTERLY REPORT PER REQUIREMENTS
OF HOLDING COMPANY ACT RELEASE NO. 22770
BY MONTH, FOR THE QUARTER ENDED DECEMBER 31, 1995
CONTENTS
Page
Statements of Income 1
Balance Sheets 2-3
Statements of Retained Earnings 4
Statements of Cost of Commercial Coal Sold and Shipped 5
Analysis of Operating Reserves and Regulatory Liabilities
and Deferred Credits 6
Information Concerning Capital Improvements 7
Analysis of Mining Plant in Service 8
Information Concerning Operations 9
Statements of Cost of Operation 10
Schedule of Changes in Coal Inventory 11
Construction Expenditure Budget - 1996 12
Summary of Allowed Cost-of-Capital Billing Adder Exhibit A: 1-3<PAGE>
<PAGE>
<TABLE>
CENTRAL OHIO COAL COMPANY
STATEMENTS OF INCOME
BY MONTH, FOR THE QUARTER ENDED DECEMBER 31, 1995
(UNAUDITED)
<CAPTION>
Three
Months
Month Ended Ended
October 31, November 30, December 31, December 31,
1995 1995 1995 1995
(in thousands)
<S> <C> <C> <C> <C>
OPERATING REVENUES -
Sales to Parent . . . . . . . . $3,877 $2,775 $2,591 $9,243
COST OF OPERATION (including
Depreciation, Depletion and
Amortization of Mining Plant of
$368,000 in October and $326,000
in November and $368,000
in December). . . . . . . . . . 3,681 2,628 2,214 8,523
OPERATING INCOME. . . . . . . . . 196 147 377 720
NONOPERATING INCOME . . . . . . . 118 170 78 366
INCOME BEFORE INTEREST CHARGES. . 314 317 455 1,086
INTEREST CHARGES -
to Parent Company . . . . . . . 4 5 5 4
INCOME BEFORE FEDERAL
INCOME TAXES. . . . . . . . . . 310 312 450 1,072
FEDERAL INCOME TAX EXPENSE. . . . 88 91 229 408
NET INCOME. . . . . . . . . . . . $ 222 $ 221 $ 221 $ 664
The common stock of the Company is
wholly owned by Ohio Power Company.
</TABLE>
<PAGE>
<PAGE>
<TABLE>
CENTRAL OHIO COAL COMPANY
BALANCE SHEETS
BY MONTH-END, FOR THE QUARTER ENDED DECEMBER 31, 1995
(UNAUDITED)
<CAPTION>
October 31, November 30, December 31,
1995 1995 1995
(in thousands)
ASSETS
<S> <C> <C> <C>
MINING PLANT:
Mining Plant in Service . . . . . . . . . . . . $75,808 $75,636 $74,891
Construction Work in Progress . . . . . . . . . 54 56 2
Total Mining Plant . . . . . . . . . . . 75,862 75,692 74,893
Accumulated Depreciation and Amortization . . . 49,678 49,057 48,885
NET MINING PLANT . . . . . . . . . . . . 26,184 26,635 26,008
CURRENT ASSETS:
Cash and Cash Equivalents . . . . . . . . . . . 9,750 11,752 12,697
Accounts Receivable:
General . . . . . . . . . . . . . . . . . . . 385 69 390
Affiliated Companies. . . . . . . . . . . . . 1,824 791 1,746
Coal. . . . . . . . . . . . . . . . . . . . . . 503 363 234
Materials and Supplies. . . . . . . . . . . . . 12,678 12,553 9,237
Other . . . . . . . . . . . . . . . . . . . . . 1,676 1,364 1,082
TOTAL CURRENT ASSETS . . . . . . . . . . 26,816 26,892 25,386
DEFERRED INCOME TAXES . . . . . . . . . . . . . . 16,478 16,449 15,896
REGULATORY ASSETS . . . . . . . . . . . . . . . . 3,311 3,236 2,758
DEFERRED CHARGES. . . . . . . . . . . . . . . . . 328 255 360
TOTAL. . . . . . . . . . . . . . . . . $73,117 $73,467 $70,408
</TABLE>
<PAGE>
<PAGE>
<TABLE>
CENTRAL OHIO COAL COMPANY
BALANCE SHEETS
BY MONTH-END, FOR THE QUARTER ENDED DECEMBER 31, 1995
(UNAUDITED)
<CAPTION>
October 31, November 30, December 31,
1995 1995 1995
(in thousands)
CAPITALIZATION AND LIABILITIES
<S> <C> <C> <C>
SHAREHOLDER'S EQUITY:
Common Stock - Par Value $100:
Authorized - 100,000 Shares
Outstanding - 69,000 Shares . . . . . . . . . $ 6,900 $ 6,900 $ 6,900
Paid-in Capital . . . . . . . . . . . . . . . . 13,069 13,069 13,069
Retained Earnings . . . . . . . . . . . . . . . 222 443 -
TOTAL SHAREHOLDER'S EQUITY . . . . . . . 20,191 20,412 19,969
LONG-TERM DEBT:
Finance Obligation. . . . . . . . . . . . . . . 407 398 390
Advances from Parent Company. . . . . . . . . . 1,500 1,500 1,500
TOTAL LONG-TERM DEBT . . . . . . . . . . 1,907 1,898 1,890
OTHER NONCURRENT LIABILITIES:
Obligations Under Capital Leases. . . . . . . . 6,100 8,831 8,965
Operating Reserves. . . . . . . . . . . . . . . 21,867 22,885 20,588
TOTAL OTHER NONCURRENT LIABILITIES . . . 27,967 31,716 29,553
CURRENT LIABILITIES:
Long-term Debt Due Within One Year. . . . . . . 104 104 104
Accounts Payable:
General . . . . . . . . . . . . . . . . . . . 831 813 803
Affiliated Companies. . . . . . . . . . . . . 435 452 420
Taxes Accrued . . . . . . . . . . . . . . . . . 567 564 -
Accrued Reclamation Costs . . . . . . . . . . . 2,035 2,027 4,496
Accrued Vacation Pay. . . . . . . . . . . . . . 821 776 647
Workers' Compensation Claims. . . . . . . . . . 1,304 1,305 1,290
Obligations Under Capital Leases. . . . . . . . 5,713 3,766 3,379
Other . . . . . . . . . . . . . . . . . . . . . 1,548 1,695 1,759
TOTAL CURRENT LIABILITIES. . . . . . . . 13,358 11,502 12,898
REGULATORY LIABILITIES AND DEFERRED CREDITS . . . 9,694 7,939 6,098
TOTAL. . . . . . . . . . . . . . . . . $73,117 $73,467 $70,408
</TABLE>
<PAGE>
<TABLE>
CENTRAL OHIO COAL COMPANY
STATEMENTS OF RETAINED EARNINGS
BY MONTH, FOR THE QUARTER ENDED DECEMBER 31, 1995
(UNAUDITED)
<CAPTION>
Three
Months
Month Ended Ended
October 31, November 30, December 31, December 31,
1995 1995 1995 1995
(in thousands)
<S> <C> <C> <C> <C>
BALANCE AT BEGINNING OF PERIOD. . $ - $222 $443 $ -
NET INCOME. . . . . . . . . . . . 222 221 221 664
CASH DIVIDENDS DECLARED . . . . . - - 664 664
BALANCE AT END OF PERIOD. . . . . $222 $443 $ - $ -
</TABLE>
<PAGE>
<PAGE>
<TABLE>
CENTRAL OHIO COAL COMPANY
STATEMENTS OF COST OF COMMERCIAL COAL SOLD AND SHIPPED
BY MONTH, FOR THE QUARTER ENDED DECEMBER 31, 1995
<CAPTION>
October November December
1995 1995 1995
(in thousands, except as noted)
<S> <C> <C> <C>
I. Calculation of Cost-of-Capital Compensation:
A. Equity Investment at Beginning of Month:
Common Stock. . . . . . . . . . . . . . . . . . . . . . . . $ 6,900 $ 6,900 $ 6,900
Paid-in Capital (excluding item D and item G) . . . . . . . 450 450 450
7,350 7,350 7,350
B. Rate of Return Allowable per HCAR No. 22770:
14.34% per annum, 1.195% per month. . . . . . . . . . . . . .01195 .01195 .01195
C. Earnings Allowable: (re investment in item A)
1. Current Month. . . . . . . . . . . . . . . . . . . . . . $ 88 $ 88 $ 88
2. Year-to-Date . . . . . . . . . . . . . . . . . . . . . . $ 880 $ 968 $ 1,056
D. Equity Investment - January 1983 (Preparation Plant). . . . . $ 6,431 $ 6,431 $ 6,431
E. Rate of Return Allowable per HCAR No. 22770:
13.01% per annum, 1.0842% per month . . . . . . . . . . . . .010842 .010842 .010842
F. Earnings Allowable: (re investment in item D)
1. Current Month. . . . . . . . . . . . . . . . . . . . . . $ 70 $ 70 $ 70
2. Year-to-Date . . . . . . . . . . . . . . . . . . . . . . $ 700 $ 770 $ 840
G. Equity Investment - January 1983 (Other Assets) . . . . . . . $ 6,188 $ 6,188 $ 6,188
H. Rate of Return Allowable per HCAR No. 22770:
12.37% per annum, 1.0308% per month . . . . . . . . . . . . .010308 .010308 .010308
I. Earnings Allowable: (re investment in item G)
1. Current Month. . . . . . . . . . . . . . . . . . . . . . $ 64 $ 63 $ 63
2. Year-to-Date . . . . . . . . . . . . . . . . . . . . . . $ 634 $ 697 $ 760
J. Total Earnings Allowable:
1. Current Month (C.1. + F.1. + I.1.) . . . . . . . . . . . $ 222 $ 221 $ 221
2. Year-to-Date (C.2. + F.2. + I.2.). . . . . . . . . . . . $ 2,214 $ 2,435 $ 2,656
K. Net Income per Statements of Income . . . . . . . . . . . . . $ 222 $ 221 $ 221
Add: Interest Charges . . . . . . . . . . . . . . . . . . . 4 5 5
Less: Nonoperating Income . . . . . . . . . . . . . . . . . 118 170 78
L. Applied Cost-of-Capital Billing Adder:
1. Current Month. . . . . . . . . . . . . . . . . . . . . . $ 108 $ 56 $ 148
2. Year-to-Date . . . . . . . . . . . . . . . . . . . . . . $ 1,200 $ 1,256 $ 1,404
II. Monthly Billing Calculation:
A. Total Operating Expenses (a). . . . . . . . . . . . . . . . . $ 3,769 $ 2,719 $ 2,443
B. Add: Monthly Cost-of-Capital Billing
Adder as Applied per L. 1. of Section I . . . . . . . . . . 108 56 148
C. Cost Applicable to Current Month Coal Billings (b). . . . . . $ 3,877 $ 2,775 $ 2,591
D. Coal Sold and Shipped in Current Month (in tons)(b) . . . . . 60,253 67,233 83,153
E. Average Price per Ton (in dollars) (C/D)(b) . . . . . . . . . $64.35 $41.28 $31.15
(a) As represented by "Cost of Operation" plus "Federal Income Taxes" reported in Statements of Income.
(b) Sales were to the Parent Company - Ohio Power Company for the Muskingum River Plant.
/TABLE
<PAGE>
<PAGE>
<TABLE>
CENTRAL OHIO COAL COMPANY
ANALYSIS OF OPERATING RESERVES AND REGULATORY LIABILITIES AND DEFERRED CREDITS
BY MONTH-END, FOR THE QUARTER ENDED DECEMBER 31, 1995
<CAPTION>
October 31, November 30, December 31,
1995 1995 1995
(in thousands)
<S> <C> <C> <C>
Operating Reserves:
Accrued Pensions. . . . . . . . . . . . . . . . $ 893 $ 896 $ 899
Accrued Postretirement Benefits
Other Than Pensions . . . . . . . . . . . . . 9,495 9,747 9,999
Accrued Reclamation Costs . . . . . . . . . . . 8,265 8,625 5,647
Workers' Compensation . . . . . . . . . . . . . 708 683 681
Postemployment Benefits . . . . . . . . . . . . 363 363 363
Accrued Rent. . . . . . . . . . . . . . . . . . 2,143 2,571 2,999
Total Operating Reserves. . . . . . . . . . $21,867 $22,885 $20,588
Deferred Credits:
Gain on Sale and Leaseback of Plant . . . . . . $6,374 $6,235 $6,097
Mining Cost Normalization . . . . . . . . . . . 3,306 1,563 -
Other . . . . . . . . . . . . . . . . . . . . . 14 141 1
Total Regulatory Liabilities and
Deferred Credits. . . . . . . . . . . . . . $9,694 $7,939 $6,098
</TABLE>
<PAGE>
<PAGE>
CENTRAL OHIO COAL COMPANY
INFORMATION CONCERNING CAPITAL IMPROVEMENTS
FOR THE QUARTER ENDED DECEMBER 31, 1995
There were no significant changes with regard to the Company's mining
plant during the quarter.
<PAGE>
<PAGE>
<TABLE>
CENTRAL OHIO COAL COMPANY
ANALYSIS OF MINING PLANT IN SERVICE
AND RELATED ACCUMULATED PROVISIONS FOR
DEPRECIATION AND AMORTIZATION
BY MONTH-END, FOR THE QUARTER ENDED DECEMBER 31, 1995
<CAPTION>
October 31, 1995 November 30, 1995 December 31, 1995
Net Net Net
Gross Accumulated Carrying Gross Accumulated Carrying Gross Accumulated Carrying
Cost Provisions Amount Cost Provisions Amount Cost Provisions Amount
(in thousands)
Description
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Surface Lands. . . . . . . $ 324 $ - $ 324 $ 324 $ - $ 324 $ 324 $ - $ 324
Mining Structures
and Equipment. . . . . . 64,610 47,597 17,013 64,611 46,971 17,640 64,082 46,794 17,288
Coal Interests
(net of depletion) . . . 8,582 - 8,582 8,409 - 8,409 8,193 - 8,193
Mine Development Costs . . 2,292 2,081 211 2,292 2,086 206 2,292 2,091 201
Total Mining Plant in
Service. . . . . . . $75,808 $49,678 $26,130 $75,636 $49,057 $26,579 $74,891 $48,885 $26,006
</TABLE>
<PAGE>
<PAGE>
CENTRAL OHIO COAL COMPANY
INFORMATION CONCERNING OPERATIONS
FOR THE QUARTER ENDED DECEMBER 31, 1995
There were no significant changes with regard to the Company s operations
during the quarter.
<PAGE>
<PAGE>
<TABLE>
CENTRAL OHIO COAL COMPANY
STATEMENTS OF COST OF OPERATION
BY MONTH, FOR THE QUARTER ENDED DECEMBER 31, 1995
<CAPTION>
Three
Months
October November December Ended
1995 1995 1995 12/31/95
(in thousands)
<S> <C> <C> <C> <C>
Direct Labor-UMW* . . . . . . . . . . . . . . . . $ 52 $ 60 $ 65 $ 177
Indirect Labor-UMW* . . . . . . . . . . . . . . . 428 347 333 1,108
Benefits-UMW* . . . . . . . . . . . . . . . . . . 717 528 433 1,678
Salaries and Benefits-Nonunion. . . . . . . . . . 365 346 303 1,014
Operating Supplies. . . . . . . . . . . . . . . . 385 425 384 1,194
Repair Parts and Materials. . . . . . . . . . . . 208 317 590 1,115
Electricity and Other Utilities . . . . . . . . . 166 183 208 557
Outside Services-Maintenance, Haulage
and Reclamation . . . . . . . . . . . . . . . . 213 46 121 380
Taxes Other Than Income Taxes** . . . . . . . . . 152 38 21 211
Rental of Equipment . . . . . . . . . . . . . . . 783 775 782 2,340
Depreciation, Depletion and Amortization. . . . . 368 326 368 1,062
Mining Cost Normalization***. . . . . . . . . . . 255 (1,744) (1,564) (3,053)
Reclamation Cost - Net. . . . . . . . . . . . . . (637) 352 (509) (794)
Other Production Costs. . . . . . . . . . . . . . 561 489 550 1,600
Subtotal. . . . . . . . . . . . . . . . . . . . . 4,016 2,488 2,085 8,589
Transfers of Production Costs (to)/from
Coal Inventory. . . . . . . . . . . . . . . . . (335) 140 129 (66)
Total . . . . . . . . . . . . . . . . . $3,681 $ 2,628 $2,214 $ 8,523
* United Mine Workers of America.
** Excludes FICA, Federal Unemployment and State Unemployment. These costs are reflected
in employee benefits.
*** Represents the deferral/accrual required to establish a selling price based on
forecasted results for the remainder of the year. The amount of mining cost
normalization is established on an "overall" company basis (i.e., not itemized) and
is eliminated by year-end.
</TABLE>
<PAGE>
<PAGE>
<TABLE>
CENTRAL OHIO COAL COMPANY
SCHEDULE OF CHANGES IN COAL INVENTORY
BY MONTH, FOR THE QUARTER ENDED DECEMBER 31, 1995
<CAPTION>
October November December
1995 1995 1995
(in thousands)
<S> <C> <C> <C>
Coal Stockpile:*
Ending Inventory. . . . . . . . . . . . . . . $503 $ 363 $ 234
Beginning Inventory . . . . . . . . . . . . . 168 503 363
Increase (Decrease) in Coal
Stockpile Inventory . . . . . . . . . . . . $335 $(140) $(129)
* The production level of coal has been greater than the demand for coal at Muskingum
River Plant, which has created a raw coal stockpile.
</TABLE>
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<PAGE>
<TABLE>
CENTRAL OHIO COAL COMPANY
CONSTRUCTION EXPENDITURE BUDGET - 1996*
<CAPTION>
Description Budgeted
Amount
<S> <C>
Mine Plant Blankets $ 60
Powerline Construction 100
Total $160
* This budget does not include any possible lease transactions.
</TABLE>
<PAGE>
<PAGE>
Exhibit A
Page 1 of 3
CENTRAL OHIO COAL COMPANY
SUMMARY OF ALLOWED COST-OF-CAPITAL BILLING ADDER EFFECTIVE JANUARY 1, 1996
Recorded interest charges plus the sum of the following equity returns:
Layer #1: $7,350,000 (Investment Prior to 1-1-83) X 12.81%
Authorization: HCAR 22770 (SEC File No. 70-6447) dated 12-10-82.
Rate of Return: The 12.81% return is no more than the rate of return on common
equity allowed by the Public Utilities Commission of Ohio (PUCO) in a retail
rate proceeding involving Ohio Power Company (OPCo) and settled in 1995.
Future Revision: The rate of return is subject to revision on January 1 of
each year based on the rate of return on common equity determined and allowed
by the Federal Energy Regulatory Commission (FERC) in the most recent
wholesale rate proceeding involving OPCo. In lieu of an applicable FERC order,
the rate of return is subject to adjustment based on the rate of return on
common equity allowed by the PUCO in the most recent retail rate proceeding
involving OPCo.
<PAGE>
<PAGE>
Exhibit A
Page 2 of 3
CENTRAL OHIO COAL COMPANY
<TABLE>
Layer #2: $6,430,933 (1-1-83 Preparation Plant Investment*) X 11.90%
Authorization: HCAR 22770 (SEC File No. 70-6447) dated 12-10-82.
Rate of Return: The 11.90% return is a weighted average cost to OPCo of
preferred and common equity and was calculated as follows:
<CAPTION>
12-31-79
Capitalization Factor Weighted
Ratio 100 Cost Cost
<S> <C> <C> <C> <C>
Preferred 11.9% 27.2% 9.46%(a) 2.57%
Common 31.8 72.8 12.81%(b) 9.33
43.7% 100.0% 11.90%
(a) Cost to OPCo of its March 1978 issue of 1,600,000 shares of $25 par
value, $ 2.27 series Cumulative Preferred Stock (the latest issue prior
to the in-service date of the Muskingum Mine Preparation Plant addition
in February 1980).
(b) No more than the rate allowed by the PUCO in a retail rate proceeding
involving OPCo and settled in 1995.
Future Revision: The common equity component (12.81%) of the above rate
of return is subject to adjustment on January 1 of each year in
accordance with the procedure described above re the Layer #1 investment.
* A part of the 1-1-83 transfer of coal mining assets from OPCo to COCCo.
</TABLE>
<PAGE>
<PAGE>
Exhibit A
Page 3 of 3
CENTRAL OHIO COAL COMPANY
<TABLE>
Layer #3: $6,187,654 (1-1-83 Investment in Other Assets*) X 11.26%
Authorization: HCAR 22770 (SEC File No. 70-6447) dated 12-10-82.
Rate of Return: The 11.26% return is a weighted average cost to OPCo of
preferred and common equity and was calculated as follows:
<CAPTION>
12-31-79
Capitalization Factor Weighted
Ratio 100 Cost Cost
<S> <C> <C> <C> <C>
Preferred 11.9% 27.2% 7.09%(a) 1.93%
Common 31.8 72.8 12.81%(b) 9.33
43.7% 100.0% 11.26%
(a) Weighted average embedded cost of OPCo's preferred stock issues
outstanding at 12-31-73.
(b) No more than the rate allowed by the PUCO in a retail rate proceeding
involving OPCo and settled in 1995.
Future Revision: The common equity component (12.81%) of the above rate
of return is subject to adjustment on January 1 of each year in
accordance with the procedure described above re the Layer #1 investment.
* A part of the 1-1-83 transfer of coal mining assets from OPCo to COCCo.
</TABLE>
