Allegheny Energy, Inc. Reports Second Quarter 2002 Results.Business Editors HAGERSTOWN Hagerstown (hā`gərztoun'), city (1990 pop. 35,445), seat of Washington co., NW Md., on Antietam Creek near its junction with the Potomac River, in the fertile Cumberland Valley; inc. 1791. , Md.--(BUSINESS WIRE)--July 30, 2002 Affirms 2002 Earnings Guidance, Announces Steps to Refocus Verb 1. refocus - focus once again; The physicist refocused the light beam" focus - cause to converge on or toward a central point; "Focus the light on this image" 2. Trading Business and Improve Performance, and Intends to Maintain the Dividend Based on Expected Earnings Allegheny Energy Allegheny Energy (NYSE: AYE) is a traditional public utility based in the Pittsburgh suburb of Greensburg. It services communities in Western Pennsylvania, Western Maryland, Northern West Virginia, Northwest Virginia. , Inc. (NYSE NYSE See: New York Stock Exchange : AYE AYE Allegheny Energy, Inc. (stock symbol) AYE Ayer Rajah Expressway AYE Amplifying Your Effectiveness (conference) ) today reported a net loss of $32.3 million ($.26 per share) for the second quarter of 2002, compared to second quarter 2001 net earnings of $115.8 million ($.97 per share). The second quarter 2002 results largely reflect weak wholesale energy markets nationwide, lower net revenue in generation and marketing, reduced economic activity, and unplanned outages at the Company's generation plants. The Company recorded an after-tax af·ter-tax also af·ter·tax adj. Relating to or being that which remains after payment, especially of income taxes: after-tax profits. charge in the second quarter of 2002 of $23.3 million ($.19 per share) for the cancellation cancellation (See: cancel) CANCELLATION. Its general acceptation, is the act of crossing a writing; it is used sometimes to signify the manual operation of tearing or destroying the instrument itself. Hyde v. Hyde, 1 Eq. Cas. Abr. 409; Rob. of generating capacity planned for La Paz, Arizona La Paz, Arizona was a short-lived early gold mining town along the Colorado River. Today it is a deserted ghost town. In 1983, long after the town was deserted, the name was adopted by the newly formed Arizona county of La Paz, which contains the ghost town. . The Company also recorded an after-tax charge of $5.5 million ($.04 per share) for unregulated Adj. 1. unregulated - not regulated; not subject to rule or discipline; "unregulated off-shore fishing" regulated - controlled or governed according to rule or principle or law; "well regulated industries"; "houses with regulated temperature" 2. investments determined to be impaired See assistive technology. . Excluding the effects of these charges, the net loss for the second quarter would have been $3.5 million ($.03 per share), compared to $115.8 million ($.97 per share) in the second quarter of 2001. Also during the second quarter of 2002, the Company completed its assessment of goodwill in accordance Accordance is Bible Study Software for Macintosh developed by OakTree Software, Inc.[] As well as a standalone program, it is the base software packaged by Zondervan in their Bible Study suites for Macintosh. with the Statement of Financial Accounting Standards (SFAS SFAS Statement of Financial Accounting Standards SFAS Special Forces Assessment and Selection SFAS Student Financial Aid Services SFAS Sport Fishing Association of Singapore SFAS Safety Features Actuation System SFAS Statewide Fixed Assets System ) No. 142, "Goodwill and Other Intangible Assets Intangible Asset An asset that is not physical in nature. Notes: Examples are things like copyrights, patents, intellectual property, and goodwill. These are the opposite of tangible assets. ." The assessment determined that approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. $210 million of goodwill, primarily related to the acquisitions of Mountaineer Gas Company and West Virginia Power The West Virginia Power are a minor league baseball team of the South Atlantic League and are the Single-A affiliate of the Milwaukee Brewers. They are located in Charleston, West Virginia and are named for a short lived electric utility in the southeastern part of the state, now Company, was impaired. As a result, the Company recorded an after-tax charge of $130.5 million ($1.04 per share) as the cumulative effect of this accounting change as of January January: see month. 1, 2002. Net earnings for the 12 months ended June June: see month. 30, 2002, were $169.1 million ($1.35 per share), compared to $336.8 million ($2.98 per share) for the 12 months ended June 30, 2001. Excluding the extraordinary charge for electric utility restructuring restructuring - The transformation from one representation form to another at the same relative abstraction level, while preserving the subject system's external behaviour (functionality and semantics). orders, the cumulative effects of accounting changes, and the effects of other transactions, net earnings for the 12 months ended June 30, 2002, would have been $316.5 million ($2.52 per share), compared to $374.4 million ($3.32 per share) for the twelve months ended June 30, 2001.
Per share earnings for comparable 2002 and 2001 periods were:
----------------------------------------------------------------------
Second 6 Months 12 Months
Quarter Ended June Ended June
----------------------------------------------------------------------
2002 2001 2002 2001 2002 2001
----------------------------------------------------------------------
Basic earnings
(loss) per share $(.26) $.97 $(.49) $1.63 $1.35 $2.98
----------------------------------------------------------------------
Cumulative effects
of accounting
changes (1.04) (.27) (1.04) (.28)
----------------------------------------------------------------------
La Paz
cancellation (.19) (.19) (.19)
----------------------------------------------------------------------
Impairment of
unregulated
investments (.04) (.04) (.04)
----------------------------------------------------------------------
Gain on Canaan
Valley land sale .10 .10
----------------------------------------------------------------------
Extraordinary
charge for
electric utility
restructuring
orders (.06)
----------------------------------------------------------------------
Pro forma income
before extraordinary
charge, cumulative
effects of
accounting changes,
and other
transactions $(.03) $.97 $ .68 $1.90 $2.52 $3.32
----------------------------------------------------------------------
Allegheny Allegheny (ăl`əgā'nē, ăl`əgä'nē), river, 325 mi (523 km) long, rising in N central Pa., and flowing NW into N.Y., then SW through Pa. Energy's second quarter 2002 results were negatively affected by: - Maintaining stability of the Company's investment grade ratings: To maintain Allegheny Energy's investment grade ratings in the near-term, the Company is aggressively working to bolster its balance sheet, improve its liquidity, and reduce capital and operating and maintenance expenses. Included in this effort is the evaluation of asset sales to generate cash to reduce debt and/or asset swaps to better balance and diversify the Company's existing generation portfolio. On July 8, 2002, Allegheny Energy announced a number of cost-cutting initiatives to better align its business with market conditions, including reducing pre-tax operating expenses by $45 million for the remainder of 2002; canceling a number of generation projects, thereby reducing capital expenditures by approximately $700 million over the next several years; and reducing the Allegheny Energy workforce by approximately 10 percent, resulting in an estimated additional $5 million of expense reductions this year and an ongoing annualized savings of $40 million to $50 million. - Maintaining Allegheny Energy's dividend: The current dividend level has been and will continue to be a priority for Allegheny Energy's management. The Company believes that the current dividend is adequately covered by the earnings of its regulated energy delivery business plus its supply business' provider of last resort sales to the energy delivery business. "Like others in the energy sector, Allegheny has not been immune to the challenges resulting from the dramatic changes in the energy markets," according to according to prep. 1. As stated or indicated by; on the authority of: according to historians. 2. In keeping with: according to instructions. 3. Allegheny Energy Chairman, President, and Chief Executive Officer Alan A`lan´ n. 1. A wolfhound. J. Noia. "Energy companies have been particularly affected by a weak wholesale market, the evaporation evaporation, change of a liquid into vapor at any temperature below its boiling point. For example, water, when placed in a shallow open container exposed to air, gradually disappears, evaporating at a rate that depends on the amount of surface exposed, the humidity of liquid wholesale energy markets, the Enron Enron A U.S. energy-trading and utilities company that housed one of the biggest accounting frauds in history. Enron's executives employed accounting practices that falsely inflated the company's revenues, which, at the height of the scandal, made the firm become the seventh bankruptcy bankruptcy, in law, settlement of the liabilities of a person or organization wholly or partially unable to meet financial obligations. The purposes are to distribute, through a court-appointed receiver, the bankrupt's assets equitably among creditors and, in most , accounting scandals Accounting scandals, or corporate accounting scandals are political and business scandals which arise with the disclosure of misdeeds by trusted executives of large public corporations. , the California California (kăl'ĭfôr`nyə), most populous state in the United States, located in the Far West; bordered by Oregon (N), Nevada and, across the Colorado River, Arizona (E), Mexico (S), and the Pacific Ocean (W). energy crisis, energy trading improprieties by certain companies, and the decline in credit quality among major merchant energy companies. The Allegheny Energy management team and I recognize that these challenging times call for prudent and decisive actions that will allow us to continue to provide shareholder value, while offering customer service that is unmatched in our industry. We are taking that action by refocusing Noun 1. refocusing - focusing again focalisation, focalization, focusing - the act of bringing into focus our business and leadership team on our core assets and reducing our marketing and trading activities and operating costs operating costs npl → gastos mpl operacionales to better reflect the earnings potential that we see there." Despite these year-to-date Year-to-date (YTD) The period beginning at the start of the calendar year up to the current date. results, Allegheny Energy reiterated its 2002 guidance of $2.50 to $2.70 per share, excluding the other transactions and cumulative effects of accounting changes, and established an earnings target for 2003 of $2.60 to $2.80 per share - a growth rate of 3 to 5 percent over 2002. The Company continues to meet all debt covenant covenant (kŭv`ənənt), agreement entered into voluntarily by two or more parties to do or refrain from doing certain acts. In the Bible and in theology the covenant is the agreement or engagement of God with man as revealed in the requirements and has sufficient liquidity to meet working capital needs.
The components of 2002 and 2003 earnings guidance are as follows:
----------------------------------------------------------------------
2002
----------------------------- -------------
Expected Projected
Year-to-date Full Year 2003 (c)
----------------------------------------------------------------------
Delivery and Services $.56 (a) $1.15 - $1.20 $1.10 - 1.15
----------------------------------------------------------------------
Generation and Marketing
----------------------------------------------------------------------
POLR .49 1.20 - 1.25 1.25 - 1.35
----------------------------------------------------------------------
Excess Generation (.22) .02 - .10 .35 - .40
----------------------------------------------------------------------
Midwest Peakers (.27) (.15) - (.20) (.20) - (.25)
----------------------------------------------------------------------
Trading .12 .28 - .35 .10 - .15
----------------------------------------------------------------------
Total Generation
and Marketing .12 (b) 1.35 - 1.50 1.50 - 1.65
----------------------------------------------------------------------
Total $.68 $2.50 - 2.70 $2.60 - 2.80
----------------------------------------------------------------------
(a) Pro forma excluding $.10 gain on sale of land in 1st quarter 2002
and $.04 charge related to impairment of unregulated investments.
----------------------------------------------------------------------
(b) Pro forma excluding $.19 charge related to cancellation of La Paz
project.
----------------------------------------------------------------------
(c) Includes 10 million additional shares assumed to be outstanding.
----------------------------------------------------------------------
According to Noia, after a thorough re-examination RE-EXAMINATION. A second examination of a thing. A witness maybe reexamined, in a trial at law, in the discretion of the court, and this is seldom refused. In equity, it is a general rule that there can be no reexamination of a witness, after he has once signed his name to the deposition, of the Company's existing businesses, operations, and strategic plans, Allegheny Energy's management team is taking immediate action to improve the Company's performance, enhance its earnings, strengthen its balance sheet, and re-establish re-establish Verb to create or set up (an organization, link, etc.) again re-establishment n Allegheny Energy's ability to deliver consistent shareholder value. These steps include the following: - Maintaining stability of the Company's investment grade ratings: To maintain Allegheny Energy's investment grade ratings in the near-term, the Company is aggressively working to bolster its balance sheet, improve its liquidity, and reduce capital and operating and maintenance expenses. Included in this effort is the evaluation of asset sales to generate cash to reduce debt and/or asset swaps to better balance and diversify the Company's existing generation portfolio. On July 8, 2002, Allegheny Energy announced a number of cost-cutting initiatives to better align its business with market conditions, including reducing pre-tax operating expenses by $45 million for the remainder of 2002; canceling a number of generation projects, thereby reducing capital expenditures by approximately $700 million over the next several years; and reducing the Allegheny Energy workforce by approximately 10 percent, resulting in an estimated additional $5 million of expense reductions this year and an ongoing annualized savings of $40 million to $50 million. - Maintaining Allegheny Energy's dividend: The current dividend level has been and will continue to be a priority for Allegheny Energy's management. The Company believes that the current dividend is adequately covered by the earnings of its regulated energy delivery business plus its supply business' provider of last resort sales to the energy delivery business. - Maintaining stability of the Company's investment grade ratings: To maintain Allegheny Energy's investment grade ratings in the near-term, the Company is aggressively working to bolster its balance sheet, improve its liquidity, and reduce capital and operating and maintenance expenses. Included in this effort is the evaluation of asset sales to generate cash to reduce debt and/or asset swaps to better balance and diversify the Company's existing generation portfolio. On July 8, 2002, Allegheny Energy announced a number of cost-cutting initiatives to better align its business with market conditions, including reducing pre-tax operating expenses by $45 million for the remainder of 2002; canceling a number of generation projects, thereby reducing capital expenditures by approximately $700 million over the next several years; and reducing the Allegheny Energy workforce by approximately 10 percent, resulting in an estimated additional $5 million of expense reductions this year and an ongoing annualized savings of $40 million to $50 million. - Maintaining Allegheny Energy's dividend: The current dividend level has been and will continue to be a priority for Allegheny Energy's management. The Company believes that the current dividend is adequately covered by the earnings of its regulated energy delivery business plus its supply business' provider of last resort sales to the energy delivery business. Noia added, "Allegheny's integrated business model has emphasized em·pha·size tr.v. em·pha·sized, em·pha·siz·ing, em·pha·siz·es To give emphasis to; stress. [From emphasis.] Adj. 1. a balance between regulated reg·u·late tr.v. reg·u·lat·ed, reg·u·lat·ing, reg·u·lates 1. To control or direct according to rule, principle, or law. 2. and non-regulated operations and a portfolio of hard, low-cost generation assets. This will not change. We remain committed to continuing to create value for our shareholders from these assets, and are confident that this plan to bolster This article is about the pillow called a bolster. For other meanings of the word "bolster", see bolster (disambiguation). A bolster (etymology: Middle English, derived from Old English, and before that the Germanic word bulgstraz our financial performance will enable us to achieve that goal today and in the future." Allegheny Energy will comment further on these results and its restructuring plan in an analyst conference call at 1 p.m. (Eastern Time) on July July: see month. 31, 2002. Investors, the news media, and others may listen to a live internet broadcast of the call at www.alleghenyenergy.com or www.streetevents.com by clicking on an available audio link. The call will also be archived for replay purposes for 10 working days after the live broadcast on both of these web sites. A news release on the earnings and supporting financial data will also be available on the Company's web site for review. With headquarters in Hagerstown, Md., Allegheny Energy is an integrated Fortune 500 energy company with a balanced portfolio of businesses, including Allegheny Energy Supply, which owns and operates electric generating facilities and supplies energy and energy-related commodities in selected domestic retail and wholesale markets; Allegheny Power, which delivers low-cost, reliable electric and natural gas service to about three million people in Maryland Maryland (mâr`ələnd), one of the Middle Atlantic states of the United States. It is bounded by Delaware and the Atlantic Ocean (E), the District of Columbia (S), Virginia and West Virginia (S, W), and Pennsylvania (N). , Ohio, Pennsylvania Pennsylvania (pĕnsəlvā`nyə), one of the Middle Atlantic states of the United States. It is bordered by New Jersey, across the Delaware River (E), Delaware (SE), Maryland (S), West Virginia (SW), Ohio (W), and Lake Erie and New York , Virginia Virginia, state, United States Virginia, state of the south-central United States. It is bordered by the Atlantic Ocean (E), North Carolina and Tennessee (S), Kentucky and West Virginia (W), and Maryland and the District of Columbia (N and NE). , and West Virginia West Virginia, E central state of the United States. It is bordered by Pennsylvania and Maryland (N), Virginia (E and S), and Kentucky and, across the Ohio R., Ohio (W). Facts and Figures Area, 24,181 sq mi (62,629 sq km). Pop. ; and a business offering fiber-optic See fiber optics. and data services, energy procurement The fancy word for "purchasing." The procurement department within an organization manages all the major purchases. and management, and energy services. More information about the Company is available at www.alleghenyenergy.com. Certain statements contained herein constitute forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. with respect to Allegheny Energy, Inc. Such forward-looking statements involve known and unknown risks, uncertainties, and other factors that may cause the actual results, performance, or achievements of Allegheny Energy to be materially different from any future results, performance, or achievements expressed or implied Inferred from circumstances; known indirectly. In its legal application, the term implied is used in contrast with express, where the intention regarding the subject matter is explicitly and directly indicated. by such forward-looking statements. Such factors may affect Allegheny Energy's operations, markets, products, services, prices, capital expenditures, development activities, and future plans. Such factors include, among others, the following: changes in general, economic, and business conditions; changes in the price of electricity and natural gas; changes in industry capacity; changes in technology; changes in financial and capital market conditions; changes in political and social conditions, deregulation Deregulation The reduction or elimination of government power in a particular industry, usually enacted to create more competition within the industry. Notes: Traditional areas that have been deregulated are the telephone and airline industries. activities and the movement toward competition in the states served by our operations; the effect of regulatory reg·u·late tr.v. reg·u·lat·ed, reg·u·lat·ing, reg·u·lates 1. To control or direct according to rule, principle, or law. 2. and legislative decisions; regulatory approvals and conditions; the loss of any significant customers; litigation An action brought in court to enforce a particular right. The act or process of bringing a lawsuit in and of itself; a judicial contest; any dispute. When a person begins a civil lawsuit, the person enters into a process called litigation. ; and changes in business strategy or business plans.
Allegheny Energy, Inc.
Performance
Second Quarter 2002
(In thousands, except per share data)
Three Months Ended 2002 2001
----------------------------------------------------------------------
Revenues
Delivery and services (Note 1) $440,136 $318,572
Generation and marketing (Note 2) 1,886,882 2,621,802
Total $2,327,018 $2,940,374
=======================
Pro forma consolidated income
before other transactions $(3,480) $115,797
La Paz cancellation (Note 3) (23,350) -
Charge for estimated impairment of
unregulated investments (5,459) -
Consolidated net income (loss) $(32,289) $115,797
=======================
Basic earnings (loss) per average share
Pro forma before other transactions $(0.03) $0.97
La Paz cancellation (Note 3) (0.19) -
Charge for estimated impairment of
unregulated investments (0.04) -
Consolidated net income (loss) $(0.26) $0.97
=======================
Diluted earnings (loss) per share $(0.26) $0.96
Average common shares outstanding 125,437 119,842
Year-to-Date
----------------------------------------------------------------------
Revenues
Delivery and services (Note 1) $959,868 $727,165
Generation and marketing (Note 2) 3,635,327 3,906,585
Total $4,595,195 $4,633,750
=======================
Pro forma consolidated income before
cumulative effect of accounting changes
and other transactions $86,241 $218,621
Cumulative effect of accounting
changes (Notes 4 and 5) (130,514) (31,147)
La Paz cancellation (Note 3) (23,350) -
Charge for estimated impairment of
unregulated investments (5,459) -
Gain on Canaan Valley land sale (Note 6) 11,917 -
Consolidated net income (loss) $(61,165) $187,474
=======================
Basic earnings (loss) per average
share
Pro forma before cumulative
effect of
accounting changes
and other transactions $0.68 $1.90
Cumulative effect of accounting changes
(Notes 4 and 5) (1.04) (0.27)
La Paz cancellation (Note 3) (0.19) -
Charge for estimated impairment of
unregulated investments (0.04) -
Gain on Canaan Valley land sale (Note 6) 0.10 -
Consolidated net income (loss) $(0.49) $1.63
=======================
Diluted earnings (loss) per share $(0.49) $1.62
Average common shares outstanding 125,343 115,165
Twelve Months Ended
----------------------------------------------------------------------
Revenues
Delivery and services (Note 1) $1,718,399 $1,364,336
Generation and marketing (Note 2) 8,621,976 5,549,153
---------------------
Total $10,340,375 $6,913,489
Pro forma consolidated income
before extraordinary charge,
cumulative effect of accounting
changes and other transactions $316,542 $374,422
Cumulative effect of accounting
changes (Notes 4 and 5) (130,514) (31,147)
La Paz cancellation (Note 3) (23,350) -
Charge for estimated impairment of
unregulated investments (5,459) -
Gain on Canaan Valley land sale
(Note 6) 11,917 -
Ohio and Virginia extraordinary charges
(Note 7) - (6,518)
Consolidated net income $169,136 $336,757
Basic earnings (loss) per average share
Pro forma before extraordinary charge,
cumulative effect of accounting changes
and other transactions $2.52 $3.32
Cumulative effect of accounting changes
(Notes 4 and 5) (1.04) (0.28)
La Paz cancellation (Note 3) (0.19) -
Charge for estimated impairment of
unregulated investments (0.04) -
Gain on Canaan Valley land sale (Note 6) 0.10 -
Ohio and Virginia extraordinary charges (Note 7) - (0.06)
Consolidated net income $1.35 $2.98
======================
Diluted earnings (loss) per share $1.35 $2.98
Average common shares outstanding 125,152 112,781
Note 1: Includes revenues for transmission, distribution, and
other services.
Note 2: Includes the sale of energy to our regulated utilities to
meet provider of last resort obligations.
Note 3: Reflects cancellation of project to build 1,080 MW of
generation planned for La Paz, Arizona.
Note 4: For 2002, reflects adoption of SFAS No. 142, "Goodwill and
Other Intangible Assets", which resulted in a charge for the
impairment of goodwill, net of effects of income taxes.
Note 5: For 2001, reflects adoption of SFAS No. 133, "Accounting for
Derivative Instruments and Hedging Activities", net of effects
of income taxes.
Note 6: Reflects sale of land at Canaan Valley to the United States
Fish and Wildlife Service.
Note 7: Reflects cost determined to be unrecoverable as a result of
deregulation proceedings in Ohio and Virginia, net of effects
of income taxes.
Allegheny Energy, Inc.
Financial Highlights
Second Quarter 2002
(In thousands, except per share data)
Three Months Ended June 30 2002
-------------------------------------
Delivery & Generation &
Services Marketing Consolidated
----------- ----------- ------------
Operating
revenues (Note 1) $440,136 $1,886,882 $2,327,018
========== ========== ==========
Net revenues (Note 2) $249,976 $ 158,113 $ 408,089
Operation expense 96,042 156,782 252,824
Depreciation and amortization 38,432 37,865 76,297
Taxes other than income taxes 23,777 24,486 48,263
Operating income
(before income taxes) $ 91,725 $ (61,020) $ 30,705
========== ========== ==========
Other income and expenses $ (8,845) $ 2,278 $ (6,567)
========== ========== ==========
Consolidated income
before cumulative effect
of accounting change $ 32,301 $ (64,590) $ (32,289)
Cumulative affect of
accounting change, net -
Consolidated net income (loss) $ 32,301 $ (64,590) $ (32,289)
========== ========== ==========
Basic earnings
(loss) per average share:
Consolidated net income $ 0.26 $ (0.52) $ (0.26)
========== ========== ==========
Diluted earnings
(loss) per average share:
Consolidated net income $ (0.26)
==========
Three Months Ended June 30 2001
-------------------------------------
Delivery & Generation &
Services Marketing Consolidated
----------- ----------- ------------
Operating
revenues (Note 1) $318,572 $2,621,802 $2,940,374
========== ========== ==========
Net revenues (Note 2) $ 261,113 $ 331,376 $ 592,489
Operation expense 97,689 115,746 213,435
Depreciation and amortization 36,839 39,025 75,864
Taxes other than income taxes 30,254 23,754 54,008
Operating income
(before income taxes) $ 96,331 $ 152,851 $ 249,182
========== ========== ==========
Other income and expenses $ (4,326) $ 4,274 $ (52)
========== ========== ==========
Consolidated income
before cumulative effect
of accounting change $ 41,386 $ 74,411 $ 115,797
Cumulative affect of
accounting change, net -
Consolidated net income (loss) $ 41,386 $ 74,411 $ 115,797
========== ========== ==========
Basic earnings
(loss) per average share:
Consolidated net income $ 0.35 $ 0.62 $ 0.97
========== ========== ==========
Diluted earnings
(loss) per average share:
Consolidated net income $ 0.96
==========
Note 1: Revenues for the generation and marketing segment include
the sale of energy to our regulated utilities to meet
provider of last resort obligations.
Note 2: Net revenues reflect revenues less the cost of fuel consumed
for electric generation, purchased energy and transmission,
natural gas purchases, deferred power costs, and cost of
goods sold.
Allegheny Energy, Inc.
Financial Highlights
Year-to-Date June 2002
(In thousands, except per share data)
Year-to-Date June 30
----------------------
2002
--------------------------------------
Delivery & Generation &
Services Marketing Consolidated
----------- ------------ ------------
Operating revenues (Note 1) $ 959,868 $ 3,635,327 $ 4,595,195
=======================================
Net revenues (Note 2) $ 529,554 $ 444,260 $ 973,814
Operation expense 208,998 254,679 463,677
Depreciation
and amortization 77,485 74,873 152,358
Taxes other than
income taxes 64,581 47,490 112,071
Operating income
(before income taxes) $ 178,490 $ 67,218 $ 245,708
=======================================
Other income and expenses $ 6,251 $ 2,653 $ 8,904
=======================================
Consolidated income before
cumulative effect
of accounting change $ 77,628 $ (8,279) $ 69,349
Cumulative affect of
accounting change, net (130,514) - (130,514)
Consolidated net
income (loss) $(52,886) $ (8,279) $ (61,165)
=======================================
Basic earnings (loss)
per average share:
Consolidated income before
cumulative effect of
accounting change $ 0.62 $ (0.07) $ 0.55
Cumulative effect of
accounting change, net (1.04) - (1.04)
Consolidated net income $ (0.42) $ (0.07) $ (0.49)
======================================
Diluted earnings (loss)
per average share:
Consolidated income before
cumulative effect of
accounting change $ 0.55
Cumulative effect of
accounting change, net (1.04)
Consolidated net income $ (0.49)
==========
Year-to-Date June 30
----------------------
2001
-------------------------------------
Delivery & Generation &
Services Marketing Consolidated
----------- ------------ ------------
Operating revenues (Note 1) $ 727,165 $ 3,906,585 $ 4,633,750
=====================================
Net revenues (Note 2) $ 564,099 $ 572,512 $ 1,136,611
Operation expense 194,241 208,316 402,557
Depreciation
and amortization 74,231 67,019 141,250
Taxes other than
income taxes 64,087 47,703 111,790
Operating income
(before income taxes) $ 231,540 $ 249,474 $ 481,014
Other income and expenses $ (6,130) $ 9,910 $ 3,780
=======================================
Consolidated income before
cumulative effect
of accounting change $ 98,120 $ 120,501 $ 218,621
Cumulative affect of
accounting change, net - (31,147) (31,147)
Consolidated net
income (loss) $ 98,120 $ 89,354 $ 187,474
=======================================
Basic earnings (loss)
per average share:
Consolidated income before
cumulative effect of
accounting change $ 0.85 $ 1.05 $ 1.90
Cumulative effect of
accounting change, net - (0.27) (0.27)
Consolidated net income $ 0.85 $ 0.78 $ 1.63
=======================================
Diluted earnings (loss)
per average share:
Consolidated income before
cumulative effect of
accounting change $ 1.89
Cumulative effect of
accounting change, net (0.27)
Consolidated net income $ 1.62
=========
Note 1: Revenues for the generation and marketing segment include the
sale of energy to our regulated utilities to meet provider of last
resort obligations.
Note 2: Net revenues reflect revenues less the cost of fuel consumed
for electric generation, purchased energy and transmission, natural
gas purchases, deferred power costs, and cost of goods sold.
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