| VECTREN CORPORATION | ||||||||||||||||
| AND SUBSIDIARY COMPANIES | ||||||||||||||||
| CONSOLIDATED STATEMENTS OF INCOME | ||||||||||||||||
| (Millions, except per share amounts) | ||||||||||||||||
| (Unaudited) | ||||||||||||||||
| Three Months | Six Months | |||||||||||||||
| Ended June 30 | Ended June 30 | |||||||||||||||
| 2011 | 2010 | 2011 | 2010 | |||||||||||||
| OPERATING REVENUES: | ||||||||||||||||
| Gas utility | $ | 134.0 | $ | 122.9 | $ | 490.7 | $ | 591.0 | ||||||||
| Electric utility | 159.3 | 151.0 | 305.7 | 295.9 | ||||||||||||
| Nonutility | 182.5 | 128.5 | 362.0 | 255.8 | ||||||||||||
| Total operating revenues | 475.8 | 402.4 | 1,158.4 | 1,142.7 | ||||||||||||
| OPERATING EXPENSES: | ||||||||||||||||
| Cost of gas sold | 48.8 | 41.5 | 243.9 | 339.3 | ||||||||||||
| Cost of fuel and purchased power | 60.3 | 57.8 | 119.8 | 115.8 | ||||||||||||
| Cost of nonutility revenues | 68.5 | 49.4 | 173.6 | 109.9 | ||||||||||||
| Other operating | 163.3 | 132.3 | 304.9 | 261.2 | ||||||||||||
| Depreciation and amortization | 61.2 | 57.2 | 120.3 | 113.0 | ||||||||||||
| Taxes other than income taxes | 12.1 | 12.1 | 31.0 | 35.2 | ||||||||||||
| Total operating expenses | 414.2 | 350.3 | 993.5 | 974.4 | ||||||||||||
| OPERATING INCOME | 61.6 | 52.1 | 164.9 | 168.3 | ||||||||||||
| OTHER INCOME (EXPENSE): | ||||||||||||||||
| Equity in (losses) of unconsolidated affiliates | (12.0 | ) | (13.9 | ) | (22.9 | ) | (5.7 | ) | ||||||||
| Other income - net | 2.8 | 0.9 | 5.2 | 0.4 | ||||||||||||
| Total other income (expense) | (9.2 | ) | (13.0 | ) | (17.7 | ) | (5.3 | ) | ||||||||
| INTEREST EXPENSE | 27.0 | 26.0 | 53.6 | 52.0 | ||||||||||||
| INCOME BEFORE INCOME TAXES | 25.4 | 13.1 | 93.6 | 111.0 | ||||||||||||
| INCOME TAXES | 10.3 | 4.4 | 33.9 | 39.1 | ||||||||||||
| NET INCOME | $ | 15.1 | $ | 8.7 | $ | 59.7 | $ | 71.9 | ||||||||
| AVERAGE COMMON SHARES OUTSTANDING | 81.7 | 81.0 | 81.7 | 81.0 | ||||||||||||
| DILUTED COMMON SHARES OUTSTANDING | 81.8 | 81.2 | 81.8 | 81.2 | ||||||||||||
| EARNINGS PER SHARE OF COMMON STOCK | ||||||||||||||||
| BASIC | $ | 0.19 | $ | 0.11 | $ | 0.73 | $ | 0.89 | ||||||||
| DILUTED | $ | 0.18 | $ | 0.11 | $ | 0.73 | $ | 0.89 | ||||||||
| VECTREN UTILITY HOLDINGS | ||||||||||||||||
| AND SUBSIDIARY COMPANIES | ||||||||||||||||
| CONSOLIDATED STATEMENTS OF INCOME | ||||||||||||||||
| (Millions) | ||||||||||||||||
| (Unaudited) | ||||||||||||||||
| Three Months | Six Months | |||||||||||||||
| Ended June 30 | Ended June 30 | |||||||||||||||
| 2011 | 2010 | 2011 | 2010 | |||||||||||||
| OPERATING REVENUES: | ||||||||||||||||
| Gas utility | $ | 134.0 | $ | 122.9 | $ | 490.7 | $ | 591.0 | ||||||||
| Electric utility | 159.3 | 151.0 | 305.7 | 295.9 | ||||||||||||
| Other | 0.5 | 0.4 | 1.0 | 0.8 | ||||||||||||
| Total operating revenues | 293.8 | 274.3 | 797.4 | 887.7 | ||||||||||||
| OPERATING EXPENSES: | ||||||||||||||||
| Cost of gas sold | 48.8 | 41.5 | 243.9 | 339.3 | ||||||||||||
| Cost of fuel and purchased power | 60.3 | 57.8 | 119.8 | 115.8 | ||||||||||||
| Other operating | 78.2 | 71.2 | 165.1 | 152.8 | ||||||||||||
| Depreciation and amortization | 47.9 | 46.8 | 96.1 | 93.3 | ||||||||||||
| Taxes other than income taxes | 11.1 | 11.6 | 29.1 | 33.9 | ||||||||||||
| Total operating expenses | 246.3 | 228.9 | 654.0 | 735.1 | ||||||||||||
| OPERATING INCOME | 47.5 | 45.4 | 143.4 | 152.6 | ||||||||||||
| OTHER INCOME - NET | 2.2 | 0.8 | 3.9 | 3.0 | ||||||||||||
| INTEREST EXPENSE | 20.4 | 20.3 | 40.8 | 40.6 | ||||||||||||
| INCOME BEFORE INCOME TAXES | 29.3 | 25.9 | 106.5 | 115.0 | ||||||||||||
| INCOME TAXES | 13.0 | 9.7 | 41.6 | 43.4 | ||||||||||||
| NET INCOME | $ | 16.3 | $ | 16.2 | $ | 64.9 | $ | 71.6 | ||||||||
| VECTREN CORPORATION | |||||
| AND SUBSIDIARY COMPANIES | |||||
| CONSOLIDATED BALANCE SHEETS | |||||
| (Millions - Unaudited) | |||||
| June 30, | December 31, | ||||
| 2011 | 2010 | ||||
| ASSETS | |||||
| Current Assets | |||||
Cash & cash equivalents | $ 14.8 | $ 10.4 | |||
Accounts receivable - less reserves of $7.6 & | |||||
$5.3, respectively | 179.0 | 176.6 | |||
Accrued unbilled revenues | 62.6 | 162.0 | |||
Inventories | 166.6 | 187.1 | |||
Recoverable fuel & natural gas costs | 9.2 | 7.9 | |||
Prepayments & other current assets | 80.6 | 101.2 | |||
Total current assets | 512.8 | 645.2 | |||
| Utility Plant | |||||
Original cost | 4,890.0 | 4,791.7 | |||
Less: accumulated depreciation & amortization | 1,897.3 | 1,836.3 | |||
Net utility plant | 2,992.7 | 2,955.4 | |||
| Investments in unconsolidated affiliates | 114.8 | 135.2 | |||
| Other utility & corporate investments | 36.1 | 34.1 | |||
| Other nonutility investments | 41.2 | 40.9 | |||
| Nonutility plant - net | 536.0 | 488.3 | |||
| Goodwill - net | 262.2 | 242.0 | |||
| Regulatory assets | 173.3 | 189.4 | |||
| Other assets | 51.0 | 33.7 | |||
TOTAL ASSETS | $ 4,720.1 | $ 4,764.2 | |||
| LIABILITIES & SHAREHOLDERS' EQUITY | |||||
| Current Liabilities | |||||
Accounts payable | $ 119.1 | $ 183.7 | |||
Accounts payable to affiliated companies | 27.7 | 59.6 | |||
Accrued liabilities | 184.5 | 178.4 | |||
Short-term borrowings | 144.5 | 118.3 | |||
Current maturities of long-term debt | 138.3 | 250.7 | |||
Long-term debt subject to tender | 30.0 | 30.0 | |||
Total current liabilities | 644.1 | 820.7 | |||
| Long-term Debt - Net of Current Maturities & | |||||
Debt Subject to Tender | 1,551.4 | 1,435.2 | |||
| Deferred Income Taxes & Other Liabilities | |||||
Deferred income taxes | 538.1 | 515.3 | |||
Regulatory liabilities | 337.6 | 333.5 | |||
Deferred credits & other liabilities | 202.6 | 220.6 | |||
Total deferred credits & other liabilities | 1,078.3 | 1,069.4 | |||
| Common Shareholders' Equity | |||||
Common stock (no par value) – issued & outstanding | |||||
81.8 and 81.7 shares, respectively | 687.6 | 683.4 | |||
Retained earnings | 762.5 | 759.9 | |||
Accumulated other comprehensive income (loss) | (3.8) | (4.4) | |||
Total common shareholders' equity | 1,446.3 | 1,438.9 | |||
TOTAL LIABILITIES & SHAREHOLDERS' EQUITY | $ 4,720.1 | $ 4,764.2 | |||
| VECTREN CORPORATION | ||||||||
| AND SUBSIDIARY COMPANIES | ||||||||
| CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||||||
| (Millions - Unaudited) | ||||||||
| Six Months Ended | ||||||||
| June 30, | ||||||||
| 2011 | 2010 | |||||||
| CASH FLOWS FROM OPERATING ACTIVITIES: | ||||||||
Net income | $ | 59.7 | $ | 71.9 | ||||
Adjustments to reconcile net income to cash from operating activities: | ||||||||
Depreciation & amortization | 120.3 | 113.0 | ||||||
Deferred income taxes & investment tax credits | 34.1 | 17.6 | ||||||
Equity in losses of unconsolidated affiliates | 22.9 | 5.7 | ||||||
Provision for uncollectible accounts | 6.9 | 10.2 | ||||||
Expense portion of pension & postretirement benefit cost | 4.5 | 4.5 | ||||||
Other non-cash charges - net | 6.1 | 14.5 | ||||||
Changes in working capital accounts: | ||||||||
Accounts receivable & accrued unbilled revenues | 111.2 | 100.0 | ||||||
Inventories | 20.5 | 7.5 | ||||||
Recoverable/refundable fuel & natural gas costs | (1.3 | ) | (24.2 | ) | ||||
Prepayments & other current assets | 22.6 | 17.6 | ||||||
Accounts payable, including to affiliated companies | (102.5 | ) | (98.8 | ) | ||||
Accrued liabilities | 4.6 | 14.0 | ||||||
Unconsolidated affiliate dividends | 0.1 | 12.2 | ||||||
Employer contributions to pension & postretirement plans | (33.1 | ) | (8.2 | ) | ||||
Changes in noncurrent assets | (3.5 | ) | 9.5 | |||||
Changes in noncurrent liabilities | (3.5 | ) | (8.3 | ) | ||||
Net cash flows from operating activities | 269.6 | 258.7 | ||||||
| CASH FLOWS FROM FINANCING ACTIVITIES: | ||||||||
Proceeds from: | ||||||||
Dividend reinvestment plan & other common stock issuances | 3.6 | 3.1 | ||||||
Requirements for: | ||||||||
Dividends on common stock | (56.4 | ) | (55.1 | ) | ||||
Retirement of long-term debt | (1.4 | ) | (1.6 | ) | ||||
Other financing activities | (1.4 | ) | - | |||||
Net change in short-term borrowings | 26.2 | (67.9 | ) | |||||
Net cash flows from financing activities | (29.4 | ) | (121.5 | ) | ||||
| CASH FLOWS FROM INVESTING ACTIVITIES: | ||||||||
Proceeds from: | ||||||||
Unconsolidated affiliate distributions | 0.5 | 0.5 | ||||||
Other collections | 0.9 | 6.8 | ||||||
Requirements for: | ||||||||
Capital expenditures, excluding AFUDC equity | (152.4 | ) | (137.2 | ) | ||||
Business acquisition, net of cash acquired | (83.4 | ) | - | |||||
Other investments | (1.4 | ) | (2.4 | ) | ||||
Net cash flows from investing activities | (235.8 | ) | (132.3 | ) | ||||
| Net change in cash & cash equivalents | 4.4 | 4.9 | ||||||
| Cash & cash equivalents at beginning of period | 10.4 | 11.9 | ||||||
| Cash & cash equivalents at end of period | $ | 14.8 | $ | 16.8 | ||||
| VECTREN CORPORATION | ||||||||||||||||
| AND SUBSIDIARY COMPANIES | ||||||||||||||||
| HIGHLIGHTS | ||||||||||||||||
| (millions, except per share amounts) | ||||||||||||||||
| (Unaudited) | ||||||||||||||||
| Three Months | Six Months | |||||||||||||||
| Ended June 30 | Ended June 30 | |||||||||||||||
| 2011 | 2010 | 2011 | 2010 | |||||||||||||
| REPORTED EARNINGS: | ||||||||||||||||
| Utility Group | $ | 16.3 | $ | 16.2 | $ | 64.9 | $ | 71.6 | ||||||||
| Nonutility Group | ||||||||||||||||
| Infrastructure Services | 2.1 | 2.0 | (0.8 | ) | (1.0 | ) | ||||||||||
| Energy Services | 0.7 | 1.7 | (0.7 | ) | 1.4 | |||||||||||
| Coal Mining | 8.5 | 1.7 | 10.1 | 5.6 | ||||||||||||
| Energy Marketing | ||||||||||||||||
| Vectren Source | (2.5 | ) | (1.9 | ) | 4.6 | 4.4 | ||||||||||
| ProLiance | (9.2 | ) | (7.0 | ) | (16.7 | ) | (3.1 | ) | ||||||||
| Other Businesses | (0.4 | ) | (4.0 | ) | (0.7 | ) | (7.0 | ) | ||||||||
| Total Nonutility Group | (0.8 | ) | (7.5 | ) | (4.2 | ) | 0.3 | |||||||||
| Corporate and Other | (0.4 | ) | - | (1.0 | ) | - | ||||||||||
| Vectren Consolidated | $ | 15.1 | $ | 8.7 | $ | 59.7 | $ | 71.9 | ||||||||
| Earnings Per Share | ||||||||||||||||
| Utility Group | $ | 0.20 | $ | 0.20 | $ | 0.79 | $ | 0.89 | ||||||||
| Nonutility Group, excluding ProLiance | 0.10 | - | 0.15 | 0.04 | ||||||||||||
| ProLiance | (0.11 | ) | (0.09 | ) | (0.20 | ) | (0.04 | ) | ||||||||
| Corporate and Other | - | - | (0.01 | ) | - | |||||||||||
| REPORTED EPS | $ | 0.19 | $ | 0.11 | $ | 0.73 | $ | 0.89 | ||||||||
| VECTREN CORPORATION | ||||||||||||||||
| AND SUBSIDIARY COMPANIES | ||||||||||||||||
| SELECTED GAS DISTRIBUTION | ||||||||||||||||
| OPERATING STATISTICS | ||||||||||||||||
| (Unaudited) | ||||||||||||||||
| Three Months | Six Months | |||||||||||||||
| Ended June 30 | Ended June 30 | |||||||||||||||
| 2011 | 2010 | 2011 | 2010 | |||||||||||||
| GAS OPERATING REVENUES (Millions): | ||||||||||||||||
| Residential | $ | 89.6 | $ | 82.4 | $ | 334.6 | $ | 405.2 | ||||||||
| Commercial | 28.8 | 26.5 | 117.7 | 147.6 | ||||||||||||
| Industrial | 12.5 | 10.9 | 31.2 | 29.7 | ||||||||||||
| Other Revenue | 3.1 | 3.1 | 7.2 | 8.5 | ||||||||||||
| $ | 134.0 | $ | 122.9 | $ | 490.7 | $ | 591.0 | |||||||||
| GAS MARGIN (Millions): | ||||||||||||||||
| Residential | $ | 55.5 | $ | 54.1 | $ | 160.6 | $ | 166.2 | ||||||||
| Commercial | 14.4 | 13.8 | 48.8 | 50.2 | ||||||||||||
| Industrial | 12.0 | 10.1 | 29.7 | 26.3 | ||||||||||||
| Other | 3.3 | 3.4 | 7.7 | 9.0 | ||||||||||||
| $ | 85.2 | $ | 81.4 | $ | 246.8 | $ | 251.7 | |||||||||
| GAS SOLD & TRANSPORTED (MMDth): | ||||||||||||||||
| Residential | 8.1 | 6.1 | 45.2 | 44.4 | ||||||||||||
| Commercial | 3.6 | 2.8 | 19.3 | 19.1 | ||||||||||||
| Industrial | 21.1 | 19.2 | 49.9 | 45.8 | ||||||||||||
| 32.8 | 28.1 | 114.4 | 109.3 | |||||||||||||
| AVERAGE GAS CUSTOMERS | ||||||||||||||||
| Residential | 896,376 | 894,200 | 902,833 | 901,462 | ||||||||||||
| Commercial | 82,616 | 82,470 | 83,234 | 83,201 | ||||||||||||
| Industrial | 1,644 | 1,636 | 1,648 | 1,627 | ||||||||||||
| 980,636 | 978,306 | 987,715 | 986,290 | |||||||||||||
| YTD WEATHER AS A PERCENT OF NORMAL: | ||||||||||||||||
| Heating Degree Days (Ohio) | 91 | % | 65 | % | 105 | % | 103 | % | ||||||||
| VECTREN CORPORATION | ||||||||||||||||
| AND SUBSIDIARY COMPANIES | ||||||||||||||||
| SELECTED ELECTRIC | ||||||||||||||||
| OPERATING STATISTICS | ||||||||||||||||
| (Unaudited) | ||||||||||||||||
| Three Months | Six Months | |||||||||||||||
| Ended June 30 | Ended June 30 | |||||||||||||||
| 2011 | 2010 | 2011 | 2010 | |||||||||||||
| ELECTRIC OPERATING REVENUES (Millions): | ||||||||||||||||
| Residential | $ | 50.6 | $ | 48.2 | $ | 98.0 | $ | 97.6 | ||||||||
| Commercial | 40.8 | 39.4 | 74.9 | 72.6 | ||||||||||||
| Industrial | 53.8 | 51.5 | 104.1 | 97.3 | ||||||||||||
| Other Revenue | 1.9 | 2.4 | 3.9 | 4.3 | �� | |||||||||||
| Total Retail | 147.1 | 141.5 | 280.9 | 271.8 | ||||||||||||
| Net Wholesale Revenues | 12.2 | 9.5 | 24.8 | 24.1 | ||||||||||||
| $ | 159.3 | $ | 151.0 | $ | 305.7 | $ | 295.9 | |||||||||
| ELECTRIC MARGIN (Millions): | ||||||||||||||||
| Residential | $ | 36.2 | $ | 34.5 | $ | 68.3 | $ | 68.1 | ||||||||
| Commercial | 26.8 | 25.4 | 48.7 | 47.1 | ||||||||||||
| Industrial | 25.5 | 24.4 | 48.9 | 46.9 | ||||||||||||
| Other | 1.6 | 2.3 | 3.5 | 4.0 | ||||||||||||
| Total Retail | 90.1 | 86.6 | 169.4 | 166.1 | ||||||||||||
| Net Wholesale Margin | 8.9 | 6.6 | 16.5 | 14.0 | ||||||||||||
| $ | 99.0 | $ | 93.2 | $ | 185.9 | $ | 180.1 | |||||||||
| ELECTRICITY SOLD (GWh): | ||||||||||||||||
| Residential | 342.2 | 356.2 | 723.4 | 767.4 | ||||||||||||
| Commercial | 335.7 | 360.3 | 636.1 | 661.0 | ||||||||||||
| Industrial | 680.9 | 697.1 | 1,342.8 | 1,307.5 | ||||||||||||
| Other Sales - Street Lighting | 4.8 | 5.1 | 10.7 | 11.1 | ||||||||||||
| Total Retail | 1,363.6 | 1,418.7 | 2,713.0 | 2,747.0 | ||||||||||||
| Wholesale | 143.0 | 108.8 | 326.9 | 344.2 | ||||||||||||
| 1,506.6 | 1,527.5 | 3,039.9 | 3,091.2 | |||||||||||||
| AVERAGE ELECTRIC CUSTOMERS | ||||||||||||||||
| Residential | 122,884 | 122,754 | 123,005 | 122,891 | ||||||||||||
| Commercial | 18,271 | 18,373 | 18,260 | 18,344 | ||||||||||||
| Industrial | 111 | 107 | 111 | 107 | ||||||||||||
| Other | 33 | 33 | 33 | 33 | ||||||||||||
| 141,299 | 141,267 | 141,409 | 141,375 | |||||||||||||
| YTD WEATHER AS A PERCENT OF NORMAL: | ||||||||||||||||
| Cooling Degree Days (Indiana) | 124 | % | 146 | % | 123 | % | 144 | % | ||||||||
| Heating Degree Days (Indiana) | 80 | % | 53 | % | 95 | % | 101 | % | ||||||||
