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UNITED STATES OF AMERICA
before the
SECURITIES AND EXCHANGE COMMISSION
PUBLIC UTILITY HOLDING COMPANY ACT OF 1935
- ----------------------------------------------
In the matter of
Central and South West Corporation REPORT FOR PERIOD
CSW International, Inc. July 1, 1998 to
CSW Energy, Inc. September 30, 1998
Dallas, Texas 75266 PURSUANT TO RULE 24
File No. 070-8423
This report is filed under Rule 24 of the Public Utility Holding
Company Act of 1935 by Central and South West Corporation ("CSW") and CSW
International, Inc. ("CSW International"), a wholly owned subsidiary of CSW.
Under HCAR 35-26383, CSW International is authorized to participate in foreign
utility companies ("FUCOs") and exempt wholesale generators ("EWGs") and to
provide consulting services with respect to the same.
Under HCAR 35-26653, CSW is authorized to invest the proceeds from the issuance
and sale of common stock and debt in EWGs and FUCOs, and to guarantee the
obligations of such entities, as defined.
Attached is the information required pursuant to HCAR 35-26383 and HCAR
35-26653.
(1) Information on each investment made by CSWI, directly or indirectly, since
the previous quarter, in any other project parent, indicating the amount
and type of such investment and identifying the facility with respect to
which such project parent was organized. See Exhibit A.
(2) Information about the amount, type, and terms of securities (including
interest rate, maturity, and the basis for inflation adjustment in the case
of non-recourse indebtedness denominated in any currency other than U.S.
dollars) issued by any project parent to a third person. See Exhibit B.
(3) A balance sheet as of the relevant report date. See Exhibit C.
(4) An income statement for the quarter ended. See Exhibit D.
<PAGE>
(5) Information on intercompany transactions with CSW International related to
CSW International's consulting services, including (a) the name of each
associate company providing services, (b) a listing of services provided,
(c) the total dollar amount of services provided, broken down by associate
company, and (d) the aggregate outstanding amount, as of the relevant
quarterly reporting date, of all guarantees issued by or for the account of
CSW, CSWI, or any project parent pursuant to this application declaration.
See Exhibit E.
(6) A computation in accordance with rule 53(a) (as modified by the
Commission's order) of CSW's aggregate investment in Exempt Entities. See
Exhibit F.
(7) A statement of such aggregate investment as a percentage of the following
as of the end of such quarter:
Total capitalization 10%
Net Utility Plant 11%
Total Consolidated Assets 7%
Market Value of Common Equity 16%
(8) Consolidated capitalization ratios as of the end of such quarter, with
consolidated debt, to include all short-term debt and non-recourse debt of
Exempt Entities to the extent normally consolidated under applicable
financial reporting rules. See Exhibit G.
(9) The market-to-book ratio of CSW's common stock at the end of such quarter.
165%
(10) An analysis of the growth in consolidated retained earnings which
segregates total earnings growth attributable to Exempt Entities from that
attributable to other subsidiaries of CSW. See Exhibit H.
(11) A statement of revenues and net income of each Exempt Entity for the twelve
months ended as of the end of such quarter. CSW International Two, Inc.
(SEEBOARD,) Newgulf Power Venture, and Energia International are the only
entities that are not development stage enterprises. For the Income
Statement of CSW International Two, Inc., refer to Exhibit I; for Newgulf
Power Venture, refer to Exhibit I-1, and for Energia International, refer
to Exhibit J.
<PAGE>
S I G N A T U R E
As requested by order of this Commission pursuant to the Public Utility
Holding Company Act of 1935, CSW International, Inc. has duly caused this report
to be signed on its behalf on this 30th day of November, 1998.
CSW International, Inc.
/s/ Sandra S. Bennett
Sandra S. Bennett
Controller
Exhibit A
CSW International, Inc.
Investments in Project Parents
For the Quarter Ended September 30, 1998
(thousands)
<TABLE>
<CAPTION>
Project Wholly Owned
Facility Parent Subsidiary Of Description Investment
- --------------------------------- ------------------ ------------------------- ------------------------------- -----------------
<S> <C> <C> <C> <C>
Empresa de Electricidade Vale de CSW Vale, LLC CSW International, Inc. Investment / Development Costs $ 79
Paranapanema S.A. (Cayman)
Energia Internacional de CSW CSW International, Central and South West Investment / Development Costs $ 605
de S.A. de C.V. Inc. Corp.
</TABLE>
Exhibit B
CSW Energy, Inc./CSW International, Inc.
Non-recourse Indebtedness
September 30, 1998
(thousands)
Initial Inflation
Type Term Rate Maturity Adjustment Amount
- ----------------- ------------ -------- --------- ---------- --------------
Eurobond 10 years 8.500% 2005 None 100,000 pounds
Eurobond 10 years 8.875% 2006 None 100,000 pounds
Yankee Bond 5 years 7.980% 2001 None 129,116 pounds
Yankee Bond 10 years 8.750% 2006 None 129,116 pounds
Fixed Rate Loan 7 years 8.250% 2003 None 139,633 pounds
Loan Notes 7 years 6.563% 2002 None 25,723 pounds
Revolver 5 years 7.600% 2001 None 95,500 pounds
Senior Notes 5 years 6.875% 2001 None $200,000
Exhibit C
CSW International, Inc.
Consolidated Balance Sheet
September 30, 1998
(Unaudited)
($000's)
ASSETS
Fixed Assets
Electric distribution plant $ 1,483,835
General plant 276,160
-----------
Total Electric Plant 1,759,995
Less - Accumulated depreciation (665,908)
-----------
Total Fixed Assets 1,094,087
Current Assets
Cash and cash equivalents 139,401
Short-term investments 31,997
Accounts receivable 331,782
Advances to affiliates 304
Inventories 43,221
Other current assets 15,830
-----------
Total Current Assets 562,535
Other Assets
Goodwill 1,444,837
Prepaid benefit costs 61,153
Equity investments and other 172,461
-----------
Total Other Assets 1,678,451
Total Assets $ 3,335,073
===========
CAPITALIZATION AND LIABILITIES
Capitalization
Common stock $ 1
Paid-in capital 829,000
Retained earnings 123,380
Minority interests 155
Foreign currency translation and other 21,281
-----------
973,817
Long-term debt 1,176,019
Current Liabilities
Accounts payable 247,958
Advances from affiliates 300,025
Accrued interest payable 43,930
Loan notes 43,786
Accrued taxes payable 142,616
Customer prepayments 30,432
Other 13,439
-----------
822,186
Deferred Credits
Deferred tax liability 267,095
Other 95,956
-----------
Total Deferred Credits 363,051
===========
Total Capitalization and Liabilities $ 3,335,073
===========
Exhibit D
CSW International, Inc.
Statement of Income
For the Quarter Ended September 30, 1998
(Unaudited)
(thousands)
Operating Revenues
Electric revenues $319,760
Other diversified 33,867
--------------
353,627
--------------
Operating Expenses
Cost of electric sales 206,158
General and administrative 56,754
Depreciation and amortization 21,554
Other diversified 18,440
--------------
302,906
--------------
Operating Income 50,721
--------------
Other Income and (Deductions)
Investment income (807)
Interest income 5,483
Interest expense (34,210)
--------------
(29,534)
--------------
Income Before Income Taxes 21,187
--------------
Provision for Income Taxes (8,666)
--------------
Net Income $ 29,853
==============
Exhibit E
CSW International, Inc.
Intercompany Service Transactions
For the Quarter Ended September 30, 1998
(Unaudited)
Name Type of Service Amount
- ----------------------- ------------------------------------- ----------
Services provided by Central and South West Services, Inc. (Item 1.) represent
all services provided by CSW Corporation. No services of "Operating Companies"
is included in this category.
1. NONE
Services provided by CSW Energy, Inc. (Item 2.) are provided by an "associate
company" which, as noted, is also a subsidiary of Central and South West
Corporation. No services from "Operating Companies" is included in this
category.
2. NONE
3. Services provided by Operating Companies to Energy-Related Companies during
the Quarter.
$ -0-
4. Guarantees issued by CSW or CSWI for Exempt Entity projects:
Enertek project $ 1,500,000
Newgulf project $ 2,000,000
CSW Energy - 6.875% Senior Notes, due 2001 200,000,000
Exhibit F
CENTRAL AND SOUTH WEST CORPORATION
AGGREGATE INVESTMENT IN EXEMPT ENTITIES
As of September 30, 1998
(UNAUDITED)
(millions)
KVA $ 5.4
Frontera 48.6
Newgulf 19.2
SEEBOARD* 829.0
Altamira 41.1
Guna 0.4
===========
$ 943.7
===========
* SEEBOARD plc is an indirect wholly owned subsidiary of CSW International Two,
Inc.
Exhibit G
CENTRAL AND SOUTH WEST CORPORATION
CAPITALIZATION
As of September 30, 1998
(UNAUDITED)
(millions)
Common stock $3,679
Preferred stock 176
-----
Total equity 3,855 39.26%
-----
Subsidiary obligated, mandatorily redeemable,
trust preferred securities 335 3.41%
-----
Long-term debt 3,702
Long-term debt and preferred stock due within twelve months 144
Short-term debt 794
Short-term debt - CSW Credit, Inc. 929
Loan Notes 59
-----
Total debt 5,628 57.32%
Total capitalization $9,818
=====
Exhibit H
CENTRAL AND SOUTH WEST CORPORATION
CONSOLIDATED RETAINED EARNINGS
As of September 30, 1998
(UNAUDITED)
(millions)
Retained Earnings at Beginning of Year $1,750
Net income
CSW International Two, Inc. 85
Energia International de CSW de SA de CV 1
Newgulf Power Venture (1)
Non-exempt entities 315
Deduct: Dividends paid (279)
============
Retained Earnings at September 30, 1998 $1,871
============
Exhibit I
CSW International Two, Inc.*
Statement of Income
For the Twelve Months Ended September 30, 1998
(Unaudited)
(millions)
Operating Revenues
Electric revenues $ 1,635
Other diversified 198
-------
1,833
Operating Expenses
Cost of electric sales 1,104
General and administrative 230
Depreciation and amortization 91
Other diversified 139
-------
1,564
Operating Income 269
-------
Other Income and (Deductions)
Interest income 17
Interest expense (121)
-------
(104)
-------
Income Before Income Taxes 165
Provision for Income Taxes 30
-------
Net Income $ 135
=======
* SEEBOARD plc is an indirect wholly owned subsidiary of CSW International Two,
Inc.
Exhibit I-1
NEWGULF POWER VENTURE
For the Twelve Months Ended September 30, 1998
Statement of Income
(Unaudited)
Operating Revenues
Electric revenues $ 2,779,422
Operating Expenses 2,472,167
General & Administrative 143,708
Other Expenses 270,264
Depreciation & Amortization 620,417
ExpensesTransferred Out (17,693)
Interest Expense 447,989
-----------
Total Expenses 3,936,852
-----------
Income Before Income Taxes $(1,157,430)
Provision for Income Taxes (451,398)
-----------
Net Income (Loss) $ (706,032)
===========
Exhibit J
Energia International de CSW de SA de CV
Statement of Income
For Twelve Months Ended September 30, 1998
(Unaudited)
($000's)
Equity Earnings in Altamira Project $ 1,243
Total Expenses -
Net Income Before Tax 1,243
Income Tax Expense 485
=============
Net Income $ 758
=============
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