Aquila Fourth Quarter and Year-End Net Loss Driven by Impairment and Restructuring Charges as Company Repositions Business.Business Editors KANSAS CITY Kansas City, two adjacent cities of the same name, one (1990 pop. 149,767), seat of Wyandotte co., NE Kansas (inc. 1859), the other (1990 pop. 435,146), Clay, Jackson, and Platte counties, NW Mo. (inc. 1850). , Mo.--(BUSINESS WIRE)--April 15, 2003 Today's Conference Call and Webcast Set for 9:00 a.m. Eastern Time Aquila Aquila, in the Bible Aquila (ăk`wĭlə, əkwĭl`ə), in the New Testament, Christian of Jewish origin from Pontus who lived at Rome. He and his wife, Prisca or Priscilla, were friendly to Paul. , Inc. (NYSE NYSE See: New York Stock Exchange :ILA ILA abbr. insulinlike activity ) today reported a fully diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. loss of $5.22 per share for the fourth quarter of 2002, or a net loss of $977.9 million on sales of $411.3 million for the quarter. The loss in the fourth quarter is primarily due to impairment Impairment 1. A reduction in a company's stated capital. 2. The total capital that is less than the par value of the company's capital stock. Notes: 1. This is usually reduced because of poorly estimated losses or gains. 2. charges, losses within discontinued operations Discontinued operations Divisions of a business that have been sold or written off and that no longer are maintained by the business. , and margin losses on winding down Aquila's merchant trading portfolio. Significant charges had been expected as the company continued its efforts to exit its wholesale commodity positions, sell additional assets and restructure its balance sheet. The company reported a fully diluted loss of $12.83 per share for full year 2002, or a net loss of $2.1 billion on sales of $2.4 billion for the year. Restructuring charges restructuring charge The expense of reorganizing a company's operations. A restructuring charge is an infrequent expense that generally results from asset writedowns or facility closings. , impairment charges and net losses on sales of assets, losses within discontinued operations, and margin losses incurred during the wind-down of Aquila's merchant trading portfolio contributed the majority of the 2002 net loss. Most of these charges are related to the execution of Aquila's ongoing plan 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. on its core utility operations. During the year, Aquila reorganized re·or·gan·ize v. re·or·gan·ized, re·or·gan·iz·ing, re·or·gan·iz·es v.tr. To organize again or anew. v.intr. To undergo or effect changes in organization. its U.S. utility operations by state to improve efficiency and better align align (  līn),v to move the teeth into their proper positions to conform to the line of occlusion. cost structures and services with specific state requirements. "During the second half of 2002, we began our transition from being a major player in the energy trading sector to concentrating on being a service-oriented Different ideas of service-orientation are found in different domains.
Canadian hockey player. A right wing for the Montreal Canadiens (1942-1960), he led his team to eight Stanley Cup championships and was the first player to score 50 goals in a C. Green, Jr., Aquila's chairman and chief executive officer. "We knew that we had a number of serious situations to address, and the necessary action steps we have taken are clearly reflected in the 2002 results. "We will continue following our 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). plan throughout 2003," Green said. "Our underlying utility operations are valuable assets and we will stay focused on maximizing the potential of that business." Restructuring Charges Aquila recorded restructuring charges of $22.4 million for the fourth quarter and $210.2 million for the year ended December December: see month. 31, 2002, as described in the table below. The fourth quarter restructuring charges consisted primarily of a loss on the termination of certain aggregator loans to substantially complete Aquila's exit from that business; losses on the exit from certain unfavorable interest rate swaps Interest Rate Swap A deal between banks or companies where borrowers switch floating-rate loans for fixed rate loans in another country. These can be either the same or different currencies. resulting from the early repayment of debt due to the restructuring of the business; and additional severance The act of dividing, or the state of being divided. The term severance has unique meanings in different branches of the law. Courts use the term in both civil and criminal litigation in two ways: first, when dividing a lawsuit into two or more parts, and second, when and retention payments to employees.
3 Months Ended Year Ended
December 31, December 31,
In millions 2002 2002
-------------------------------------------------------- -------------
Domestic Networks:
Severance costs $1.4 $16.2
Disposition of corporate aircraft -- 5.1
-------------------------------------------------------- -------------
Total Domestic Networks 1.4 21.3
-------------------------------------------------------- -------------
Capacity Services:
Interest rate swap reductions 6.2 6.2
-------------------------------------------------------- -------------
Total Capacity Services 6.2 6.2
-------------------------------------------------------- -------------
Wholesale Services:
Severance costs 1.5 30.6
Retention payments 1.6 30.5
Lease agreements 1.9 38.5
Writedown of leasehold improvements and
equipment -- 58.8
Loss on termination of aggregator loan
program 9.0 9.0
Disposition of corporate aircraft -- 2.0
Other -- 4.4
-------------------------------------------------------- -------------
Total Wholesale Services 14.0 173.8
-------------------------------------------------------- -------------
Corporate and Other severance costs .8 8.9
-------------------------------------------------------- -------------
Total restructuring charges $22.4 $210.2
======================================================== =============
Impairment Charges and Net Loss on Sale of Assets Aquila recorded several significant impairment charges in the fourth quarter of 2002 as a result of the change in strategic focus. A decision was made in the fourth quarter to halt the build-out Build-out is an urban planner’s estimate of the amount and location of potential development for an area. Build-out is one step of the land use planning process. Evaluation of potential development impacts begins with a build-out analysis. of Everest Connections' network to allow that business to become self-funding self-funding, n the method of providing employee benefits in which the sponsor does not purchase conventional insurance but rather elects to pay for the claims directly, generally through the services of a third-party administrator. , a goal it has since achieved. As a result of this change, a reassessment Reassessment The process of re-determining the value of property or land for tax purposes. Notes: Property is usually reassessed on an annual basis. You may request a "reassessment" if you disagree with your assessment. of the realizability Realizability is a part of proof theory which can be used to handle information about formulas instead of about the proofs of formulas.[1] A natural number n is said to realize a statement in the language of arithmetic of natural numbers. of the investments in communications network The transmission channels interconnecting all client and server stations as well as all supporting hardware and software. assets and recorded goodwill was completed, resulting in an impairment charge of $204.5 million. In addition, due to the limitations on liquidity, a change in strategic direction regarding international investments, the progress on sale transactions regarding these investments, and impairment charges that were being taken at the underlying business, impairment charges of $247.5 million and $127.2 million were recorded against the United Kingdom and Australian Australian pertaining to or originating in Australia. Australian bat lyssavirus disease see Australian bat lyssavirus disease. Australian cattle dog a medium-sized, compact working dog used for control of cattle. investments, respectively. The impairment charges and net loss on sale of assets are listed below:
3 Months Ended Year Ended
December 31, December 31,
----------------
In millions 2002 2002 2001
----------------------------------------------------- --------- ------
Domestic Networks:
Investment in Quanta Services $(2.0) $696.1 $--
Everest Connections and other
communications investments 204.5 227.6 16.5
Enron exposure -- -- 31.8
Gas distribution system 9.0 9.0 --
----------------------------------------------------- --------- ------
Total Domestic Networks 211.5 932.7 48.3
----------------------------------------------------- --------- ------
International Networks:
Midlands Electricity 247.5 247.5 --
Multinet and AlintaGas 127.2 127.2 11.5
Other 6.4 3.4 --
----------------------------------------------------- --------- ------
Total International Networks 381.1 378.1 11.5
----------------------------------------------------- --------- ------
Capacity Services:
Turbines 42.1 42.1 --
Exit from Lodi gas storage investment -- 21.9 --
Termination of Cogentrix acquisition -- 12.2 --
Capacity Services goodwill 7.9 7.9 --
Other 4.8 6.2 --
----------------------------------------------------- --------- ------
Total Capacity Services 54.8 90.3 --
----------------------------------------------------- --------- ------
Wholesale Services:
Wholesale Services goodwill -- 178.6 --
Enron exposure -- -- 35.0
Other 2.2 3.5 --
----------------------------------------------------- --------- ------
Total Wholesale Services 2.2 182.1 35.0
----------------------------------------------------- --------- ------
Total impairment charges and net loss
on sale of assets $649.6 $1,583.2 $94.8
===================================================== ========= ======
During 2002, Aquila completed a number of asset sales as part of its previously announced program to enhance its liquidity and dispose of dis·pose v. dis·posed, dis·pos·ing, dis·pos·es v.tr. 1. To place or set in a particular order; arrange. 2. non-core assets. Asset sales through December 31, 2002 were as follows:
Gross
In millions Proceeds
----------------------------------------------------------------------
Natural gas gathering and pipeline assets $262.9
Lockport power project 37.5
New Zealand networks 489.1
United Kingdom gas storage facility 36.9
Investment in Quanta Services 48.5
Texas gas storage facility 160.4
Merchant loan portfolio 258.5
Other assets 55.7
----------------------------------------------------------------------
Total $1,349.5
======================================================================
Discontinued Operations In connection with the sales of its natural gas storage facilities, gas gathering and pipeline assets, merchant loan portfolio and coal handling facility, Aquila reported the results of these businesses as discontinued operations in its consolidated income statements consolidated income statement An income statement that combines the income statements of two or more organizations. As with other consolidated statements, a consolidated income statement eliminates any funds owed to or due from firms within the same group. for the three years ended December 31, 2002. Included in the 2002 loss from discontinued operations were net pretax losses pretax loss A loss reported before tax benefits are considered. on sales of assets of $184.0 million related to the merchant loan portfolio that was recorded in the fourth quarter of 2002 and a $240.3 million loss related to the gas gathering and pipeline assets that was recorded in the third quarter. Liquidity Aquila experienced significant net losses and negative cash flows from operations in 2002. It also experienced a number of credit downgrades and currently is rated non-investment grade. This caused the company to post a substantial amount of cash or letters of credit as collateral collateral (kəlăt`ərəl), something of value given or pledged as security for payment of a loan. Collateral consists usually of financial instruments, such as stocks, bonds, and negotiable paper, rather than physical goods, although on a number of contractual agreements. As a result of the 2002 losses, Aquila was in violation of an interest coverage ratio 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 and a covenant that requires maintaining a specified debt to capitalization capitalization n. 1) the act of counting anticipated earnings and expenses as capital assets (property, equipment, fixtures) for accounting purposes. 2) the amount of anticipated net earnings which hypothetically can be used for conversion into capital assets. ratio. On April 11, 2003, Aquila closed on a new financing agreement that replaces its short-term Short-term Any investments with a maturity of one year or less. short-term 1. Of or relating to a gain or loss on the value of an asset that has been held less than a specified period of time. credit facilities credit facilities npl → facilidades fpl de crédito credit facilities npl → facilités fpl de paiement credit facilities . The package consists of two secured loan facilities -- a one-year adj. 1. completing its life cycle within a year. Adj. 1. one-year - completing its life cycle within a year; "a border of annual flowering plants" annual phytology, botany - the branch of biology that studies plants $200 million loan to UtiliCorp Australia Australia (ôstrāl`yə), smallest continent, between the Indian and Pacific oceans. With the island state of Tasmania to the south, the continent makes up the Commonwealth of Australia, a federal parliamentary state (2005 est. pop. , Inc. and a $430 million three-year term loan to Aquila. The initial amount drawn under the one-year loan will be $100 million, and the company will have an option to draw another $100 million within 30 days. The one-year loan is non-recourse to Aquila, Inc. Proceeds from the financings will be used to retire debt and thereby eliminate the covenant violations stated above. The new financings are expected to provide sufficient liquidity to cover the company's operational needs through June June: see month. 2004. Aquila's next significant need for outside capital relates to senior debt that matures in 2004. The company anticipates retiring those notes through additional asset sales. Restatement Restatement A revision in a company's earlier financial statements. Notes: The need for restating financial figures can result from fraud, misrepresentation, or a simple clerical error. of 2000 and 2001 Cash Flow Statements Aquila's consolidated statements of cash flows included in its Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. filed today have been restated for the years ended December 31, 2001 and 2000. These changes had no impact on earnings or losses. Between 1997 and 2000, Aquila was paid in advance on certain long-term Long-term Three or more years. In the context of accounting, more than 1 year. long-term 1. Of or relating to a gain or loss in the value of a security that has been held over a specific length of time. Compare short-term. contracts that were treated as operating activities for cash flow purposes. As a result of developments in industry accounting and guidance in 2002, these cash flows are now required to be shown as financing activities. As a result, cash flow from operating activities increased in 2001 by $82.2 million and decreased in 2000 by $396.1 million. Cash flows from financing activities were changed by corresponding amounts. The restatement also includes a reclassification Reclassification The process of changing the class of mutual funds once certain requirements have been met. These requirements are generally placed on load mutual funds. Reclassification is not considered to be a taxable event. of the $110.8 million of proceeds on the sale of shares of Aquila's merchant subsidiary in 2001 from cash flows from operating activities to cash flows from investing activities as previously reported on its Form 10-K/A filed in August 2002. The net effect of the changes discussed above is shown in the following table:
For the Year Ended December 31,
-------------------------------------------
2001 2000
--------------------- ---------------------
As As
Previously As Previously As
In millions Reported Restated Reported Restated
------------------------------------- --------- ----------- ---------
Cash provided from
operating activities $223.7 $195.1 $789.9 $393.8
Cash used for investing
activities (886.5) (775.7) (1,729.4) (1,729.4)
Cash provided from
financing activities 533.1 450.9 1,107.2 1,503.3
------------------------------------- --------- ----------- ---------
Net increase (decrease) in
cash and cash equivalents $(129.7) $(129.7) $ 167.7 $ 167.7
------------------------------------- --------- ----------- ---------
Domestic Networks Domestic Networks reported a loss before interest and taxes of $829.6 million for 2002 compared to earnings before interest and taxes In financial and business accounting, earnings before interest and taxes (EBIT) is a measure of a firm's profitability that excludes interest and income tax expenses.[1] EBIT = Operating Revenue – Operating Expenses + Non-operating Income (EBIT EBIT See: Earnings Before Interest and Taxes EBIT See earnings before interest and taxes (EBIT). ) of $117.9 million for 2001. As noted above, this decrease was primarily the result of $932.7 million of impairment charges and net losses on sales of telecommunications Communicating information, including data, text, pictures, voice and video over long distance. See communications. assets and investments as well as $21.3 million of restructuring charges resulting from the realignment re·a·lign tr.v. re·a·ligned, re·a·lign·ing, re·a·ligns 1. To put back into proper order or alignment. 2. To make new groupings of or working arrangements between. of Aquila's domestic utility businesses. Results for the business unit were also impacted by a $30.1 million decrease in off-system power sales, the sale of the company's Missouri Missouri, state, United States Missouri (mĭz  r`ē, –ə), one of the midwestern states of the United States. pipeline business in January January: see month. 2002, and lower earnings and a
reduced ownership stake in Quanta quan·ta n. Plural of quantum. Services. These were partially offset by a reduction of costs associated with Everest Connections in 2002. International Networks International Networks reported a loss before interest and taxes of $70.1 million for 2002 compared to EBIT of $125.4 million in 2001. This loss also was primarily the result of $378.1 million of impairment charges in 2002. These charges were partially offset by a $130.5 million pretax pre·tax adj. Existing before tax deductions: pretax income. pretax adj [profit] → vor (Abzug der) Steuern gain on the sale of Aquila's New Zealand New Zealand (zē`lənd), island country (2005 est. pop. 4,035,000), 104,454 sq mi (270,534 sq km), in the S Pacific Ocean, over 1,000 mi (1,600 km) SE of Australia. The capital is Wellington; the largest city and leading port is Auckland. investment. Additionally, the above losses were partially offset by stronger equity in earnings of investments as they increased by $50.5 million in 2002. This increase was driven by the acquisition of Midlands Electricity The Midlands Electricity Board was formed in 1947, under the Electricity Act of that year. The counterpart of the East Midlands board, it served southern, and western parts of Warwickshire, as well as the counties of Worcestershire, Herefordshire, Shropshire, and Staffordshire, as in May 2002 and the change in accounting for goodwill. Capacity Services Capacity Services reported a loss before interest and taxes of $105.0 million for 2002 compared to EBIT of $88.4 million for 2001. This loss resulted primarily from $90.3 million of impairment charges and net losses on sales of assets and $6.2 million of restructuring charges. Gross profit in this unit decreased $104.1 million primarily due to decreases in electricity prices, lack of pricing volatility which reduced opportunities to take significant price positions, and increased fixed capacity payments as new plants became operational or were online for a full year. Additionally, contract terminations Defense procurement: the cessation or cancellation, in whole or in part, of work under a prime contract or a subcontract thereunder for the convenience of, or at the option of, the government, or due to failure of the contractor to perform in accordance with the terms of the contract (default). due to counterparty Counterparty The other participant, including intermediaries, in a swap or contract. creditworthiness Creditworthiness The condition in which the risk of default on a debt obligation by that entity is deemed low. Creditworthiness Eligibility of an individual or firm to borrow money. generated losses of $10 million in 2002. Wholesale Services Wholesale Services reported a loss before interest and taxes of $566.0 million in 2002 compared to EBIT of $224.9 million in 2001. This loss included impairment charges of $182.1 million, and restructuring charges of $173.8 million. In addition, the lack of price trends and lower volatility, the record earnings in 2001 and the exit from the wholesale trading business led to a decrease in gross profit for Wholesale Services operations of $726.3 million in 2002 compared to 2001. The unit incurred $115.8 million in losses in 2002 as a result of actions to balance counter party positions, reduce open positions and terminate Terminate (terminat.exe) was a shareware modem terminal and host program for MS-DOS and compatible operating systems developed from the early to the late 1990s by the Dane Bo Bendtsen. The last release (5. existing contracts. Also impacting results were unfavorable movements in credit, liquidity and interest reserves, unfavorable movements in trading positions that were not fully hedged, and unfavorable adjustments related to final settlements. These 2002 losses are in comparison to record earnings in 2001. Income Tax Expense (Benefit) Income taxes decreased $316.2 million in 2002 compared to 2001, primarily as a result of the loss before income taxes in 2002 compared to record earnings in 2001. However, the 2002 expected income tax benefit was significantly reduced as a result of valuation allowances provided against capital loss carryforwards Loss Carryforward An accounting technique with which a company applies net operating losses of the current year to future year's profits in order to reduce tax liability. Notes: , non-deductible goodwill and additional deferred taxes related to our international investments. Conference Call, Webcast and Additional Information Aquila will host a conference call and webcast today at 9:00 a.m. Eastern Time in which senior executives will review 2002 fourth quarter and full-year results. Participants will be Chief Executive Officer Rick Green, Chief Operating Officer Chief Operating Officer (COO) The officer of a firm responsible for day-to-day management, usually the president or an executive vice-president. Keith Keith may refer to: People with the given name Keith:
n. See hellgrammite. [Probably from the name Dobson.] Noun 1. dobson - large brown aquatic larva of the dobsonfly; used as fishing bait hellgrammiate . To access the live webcast via the Internet Internet Publicly accessible computer network connecting many smaller networks from around the world. It grew out of a U.S. Defense Department program called ARPANET (Advanced Research Projects Agency Network), established in 1969 with connections between computers at the , go to Aquila's website at www.aquila.com and click on the link to the webcast. Listeners should allow at least five minutes to register and access the presentation. For those unable to listen to the live broadcast, replays will be available for two weeks, beginning approximately two hours after the presentation. Web users can use the same access method outlined above. Replay will also be available by telephone through April 22 at 800/405-2236 in the United States, and at 303/590-3000 for international callers. Callers must enter the access code 534824 when prompted. Additional supplemental information, including income statements by business segment, consolidated cash flow statement, consolidated balance sheet consolidated balance sheet A balance sheet in which assets and liabilities of a parent company and its controlled subsidiaries are combined, thereby presenting balance sheet items for the parent and its subsidiaries as if they were a single firm. and statistical information, is available at www.aquila.com. Click on "Investors" near the top of the screen, then "Financial Performance" at left. Based in Kansas City, Missouri Kansas City is the largest city in the state of Missouri. It encompasses parts of Jackson, Clay, Cass, and Platte counties and is the anchor city of the Kansas City Metropolitan Area, the second largest in Missouri, which includes counties in both Missouri and Kansas. , Aquila operates electricity and natural gas distribution networks serving customers in seven states and in Canada Canada (kăn`ədə), independent nation (2001 pop. 30,007,094), 3,851,787 sq mi (9,976,128 sq km), N North America. Canada occupies all of North America N of the United States (and E of Alaska) except for Greenland and the French islands of , the United Kingdom and Australia. The company also owns and operates power generation assets. At December 31, 2002, Aquila had total assets of $9.3 billion. More information is available at www.aquila.com. "EBIT" Aquila uses the term earnings before taxes and interest ("EBIT") as a performance measure for segment financial analysis. The term is not meant to be considered an alternative to net income or cash flows from operating activities, which are determined 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 generally accepted accounting principles The standard accounting rules, regulations, and procedures used by companies in maintaining their financial records. Generally accepted accounting principles (GAAP) provide companies and accountants with a consistent set of guidelines that cover both broad accounting , as an indicator of operating performance or as a measure of liquidity or other performance measures used under generally accepted accounting principles. In addition, the term may not be comparable to similarly titled measures used by other companies. AQUILA, INC. Consolidated Statements of Income
----------------------------------------------------------------------
3 Mos. Ended Year Ended Dec. 31
Dec. 31
----------------------------------------------------------------------
In millions, except per share
amounts 2002 2001 2002 2001
----------------------------------------------------------------------
Sales $411.3 $732.6 $2,377.1 $3,711.0
Cost of sales 347.6 380.7 1,543.4 2,022.9
----------------------------------------------------------------------
Gross profit 63.7 351.9 833.7 1,688.1
----------------------------------------------------------------------
Operating expenses 173.1 203.1 756.6 942.6
Restructuring charges 22.4 -- 210.2 --
Impairment charges and net loss
on asset sales 649.6 94.8 1,583.2 94.8
Depreciation and amortization
expense 52.9 56.8 214.3 240.9
----------------------------------------------------------------------
Total operating expenses 898.0 354.7 2,764.3 1,278.3
Equity in earnings of investments 38.4 18.9 166.9 119.3
Minority interest 1.3 .1 7.8 (20.1)
Other income (expense) 7.1 (1.8) 17.0 23.0
Gain on sale of subsidiary stock 130.5 -- 130.5 110.8
----------------------------------------------------------------------
Earnings (loss) before interest
and taxes (657.0) 14.4 (1,608.4) 642.8
----------------------------------------------------------------------
Total interest expense 72.8 46.6 249.5 216.4
Income tax expense (benefit) 37.7 (11.1) (135.1) 181.1
----------------------------------------------------------------------
Earnings (loss) from continuing
operations (767.5) (21.1) (1,722.8) 245.3
Earnings (loss) from discontinued
operations, net of tax (187.7) 14.9 (329.6) 34.1
Cumulative effect of accounting
change (22.7) -- (22.7) --
----------------------------------------- ------- ---------- ---------
Net income (loss) $(977.9) $(6.2) $(2,075.1) $279.4
========================================= ======= ========== =========
Weighted average shares
outstanding -- diluted (a) 187.4 115.7 161.7 115.7
----------------------------------------- ------- ---------- ---------
Earnings (loss) per share from
continuing operations -- diluted $(4.10) $(.18) $(10.65) $2.12
Earnings (loss) per share from
discontinued operations -- diluted (1.00) .13 (2.04) .30
Cumulative effect of accounting
change -- diluted (.12) -- (.14) --
----------------------------------------- ------- ---------- ---------
Net income (loss) per share --
diluted $(5.22) $(.05) $(12.83) $2.42
========================================= ======= ========== =========
(a) Average shares outstanding increased for the 2002 periods due to
the issuance of 12.6 million common shares in the January 2002
exchange offer for Aquila Merchant Services, the issuance of
another 12.5 million shares in January 2002 and 37.5 million
shares in July 2002 through public offerings and the issuance of
11.7 million shares in November on the conversion of premium
equity participating securities.
AQUILA, INC. Earnings Before Interest and Taxes (EBIT)
3 Months Ended Favorable
December 31,
--------------------
In millions 2002 2001 (Unfavorable)
-------------------------------------------------- -------------------
Global Networks:
Domestic Networks:
Utilities $21.4 $12.3 $9.1
Quanta Services 1.2 2.4 (1.2)
Communications (212.0) (28.6) (183.4)
-------------------------------------------------- -------------------
Total Domestic Networks (189.4) (13.9) (175.5)
International Networks (209.1) 8.1 (217.2)
-------------------------------------------------- -------------------
Total Global Networks (398.5) (5.8) (392.7)
Merchant Services:
Capacity Services (86.6) 14.2 (100.8)
Wholesale Services (160.2) 4.2 (164.4)
Minority interest -- (2.5) 2.5
-------------------------------------------------- -------------------
Total Merchant Services (246.8) 15.9 (262.7)
Corporate and Other (11.7) 4.3 (16.0)
-------------------------------------------------- -------------------
Total EBIT $(657.0) $14.4 $(671.4)
================================================== ===================
Year Ended December 31, Favorable
-------------------------
In millions 2002 2001 (Unfavorable)
------------------------------------------------- --------------------
Global Networks:
Domestic Networks:
Utilities $125.8 $150.8 $(25.0)
Quanta Services (699.3) 21.4 (720.7)
Communications (256.1) (54.3) (201.8)
------------------------------------------------- --------------------
Total Domestic Networks (829.6) 117.9 (947.5)
International Networks (70.1) 125.4 (195.5)
------------------------------------------------- --------------------
Total Global Networks (899.7) 243.3 (1,143.0)
Merchant Services:
Capacity Services (105.0) 88.4 (193.4)
Wholesale Services (566.0) 224.9 (790.9)
Minority interest -- (26.4) 26.4
------------------------------------------------- --------------------
Total Merchant Services (671.0) 286.9 (957.9)
Corporate and Other (37.7) 112.6 (150.3)
------------------------------------------------- --------------------
Total EBIT $(1,608.4) $642.8 $(2,251.2)
================================================= ====================
AQUILA, INC. Consolidated Balance Sheets
December 31,
In millions 2002 2001
----------------------------------------------------------- ----------
ASSETS
Cash and cash equivalents $441.7 $262.9
Restricted cash 493.9 --
Accounts receivable, net 1,672.8 2,926.8
Price risk management assets 545.2 824.5
Other current assets 920.6 791.0
----------------------------------------------------------- ----------
Total current assets 4,074.2 4,805.2
----------------------------------------------------------- ----------
Property, plant and equipment, net 3,180.6 2,901.9
Investments in unconsolidated subsidiaries 914.9 2,045.6
Price risk management assets 491.6 435.2
Other assets 578.4 720.0
Non-current assets of discontinued operations 19.5 1,058.6
----------------------------------------------------------- ----------
Total Assets $9,259.2 $11,966.5
=========================================================== ==========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current maturities of long-term debt $530.7 $679.1
Short-term debt 301.0 548.6
Accounts payable 1,616.6 3,156.2
Price risk management liabilities 469.5 493.5
Other current liabilities 679.1 807.6
----------------------------------------------------------- ----------
Total current liabilities 3,596.9 5,685.0
----------------------------------------------------------- ----------
Long-term debt, net 2,398.0 1,747.9
Deferred income taxes and credits 423.0 347.8
Price risk management liabilities 282.8 175.4
Long-term gas contracts 671.2 752.7
Other liabilities 279.4 456.1
Company-obligated preferred securities -- 250.0
Common shareholders' equity 1,607.9 2,551.6
----------------------------------------------------------- ----------
Total Liabilities and Shareholders' Equity $9,259.2 $11,966.5
=========================================================== ==========
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