QuickLinks -- Click here to rapidly navigate through this document
Press Release | ||
220 West Main Street Louisville, KY 40232 | ||
Media Contact: Chip Keeling | ||
24-Hour Media Hotline: 502.627.4999 | Toll-free: 888.627.4999 |
LG&E Energy Corp. Reports 2001 Utility Earnings
(LOUISVILLE, KY—February 21, 2002)—LG&E Energy Corp. today reported earnings of its two utility subsidiaries, Louisville Gas and Electric Company and Kentucky Utilities Company, for the year ended December 2001.
Louisville Gas & Electric Company—2001 net income available for common stock was $102 million, down $3 million from the $105 million earned in 2000. Primary factors driving LG&E's 2001 earnings included $20 million higher net revenues from electric and gas sales and $5 million lower interest expense offset by higher other operating and maintenance expenses of approximately $27 million.
Electric sales margins were higher than in 2000 primarily resulting from the lower cost of power purchased. Gas sales margins increased as a result of a gas rate increase ordered by the Kentucky Public Service Commission in September 2000, partially offset by a decrease in volumes sold.
Items contributing to the increase in other operating and maintenance expenses included an increase in pension and related benefits expense ($12 million), amortization of deferred costs from the Company's work force transition separation program ($13 million) and increases in bad debt expenses, property insurance, one-utility program cost amortization and maintenance costs ($6 million). These higher costs were offset in part by lower salary and related benefit expenses due to the work force reductions during 2001. The lower interest expense is primarily attributable to reductions in short-term interest rates throughout 2001.
Kentucky Utilities Company—2001 net income available for common stock was $94 million, up $1 million from the $93 million earned in 2000. 2001 net electric revenues were relatively flat when compared to 2000.
Primary factors driving KU's 2001 earnings included an increase in other operating and maintenance costs of approximately $6 million, non-recurring charges of approximately $7 million as a result of the Company's work force transition separation program, lower depreciation and amortization expense of approximately $8 million mainly resulting from a settlement order in December 2001 from the Kentucky Public Service Commission (KPSC), lower property and other taxes of $3 million and approximately $5 million of lower interest expense resulting from reductions in short-term interest rates throughout the year.
Items contributing to the increase in other operating and maintenance expenses included an increase in pension and related benefits expense ($7 million), amortization of deferred costs from the Company's work force transition separation program ($5 million), offset in part by lower salary and related benefit expenses resulting from workforce reductions during 2001 and decreased power generation maintenance expenses.
Louisville Gas & Electric Company—LG&E earned $91 million in net income available for common stock in the fourth quarter 2001 representing a $65 million increase over the amount earned during the same period in 2000. Pursuant to the settlement order received from the KPSC in December 2001, LG&E reversed the $144 million non-recurring charge taken earlier in the year by recording a regulatory asset and booked additional operating expense of $13 million representing amortization of the regulatory asset for 2001. Operating revenues were $72 million lower in the fourth quarter 2001
compared to the same period in 2000 primarily due to unseasonably mild weather and lower fuel costs billed.
Kentucky Utilities Company—KU earned $55 million in net income available for common stock in the fourth quarter 2001, an increase of $31 million as compared to the same period in 2000. This increase was primarily due to the effects of the settlement order received from the KPSC in December 2001. Pursuant to the order, KU reversed $57 million of the non-recurring charge taken earlier in the year by recording a regulatory asset, booked additional operating expenses of $5 million representing amortization of the regulatory asset for 2001 and reduced depreciation expense by $6 million.
LG&E Energy Corp., headquartered in Louisville, Ky., is a diversified energy services company that is a member of the Powergen plc (LSE: NYSE: PWG) family of companies. LG&E Energy owns and operates Louisville Gas and Electric Company, a regulated electric and gas utility serving Louisville, Ky., and 16 surrounding counties and Kentucky Utilities Company, a regulated electric utility, based in Lexington, Ky., which serves customers in 77 Kentucky counties and five counties in Virginia.
Louisville Gas & Electric Company and Subsidiary
Consolidated Income Statements
(In thousands of dollars)
(Unaudited)
| Three Months Ended December 31, | Twelve Months Ended December 31, | ||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2001 | 2000 | 2001 | 2000 | ||||||||||
Operating Revenues | ||||||||||||||
Electric | $ | 148,034 | $ | 164,620 | $ | 705,925 | $ | 710,958 | ||||||
Gas | 74,669 | 129,813 | 290,775 | 272,489 | ||||||||||
Total operating revenues | $ | 222,703 | $ | 294,433 | $ | 996,700 | $ | 983,447 | ||||||
Operating Expenses | ||||||||||||||
Fuel for electric generation | $ | 34,660 | $ | 38,988 | $ | 159,231 | $ | 159,418 | ||||||
Power purchased | 21,824 | 26,888 | 81,475 | 96,894 | ||||||||||
Gas supply expenses | 48,574 | 98,732 | 206,165 | 196,912 | ||||||||||
Non-recurring charges | (144,385 | ) | (8,141 | ) | — | — | ||||||||
Other operating & maintenance expenses | 77,465 | 54,383 | 226,505 | 199,652 | ||||||||||
Depreciation and amortization | 23,173 | 25,122 | 100,356 | 98,291 | ||||||||||
Federal and state income taxes | 57,813 | 16,808 | 63,452 | 64,425 | ||||||||||
Property and other taxes | 4,790 | 4,821 | 17,743 | 18,985 | ||||||||||
Total operating expenses | $ | 123,914 | $ | 257,601 | $ | 854,927 | $ | 834,577 | ||||||
Net Operating Income | $ | 98,789 | $ | 36,832 | $ | 141,773 | $ | 148,870 | ||||||
Other Income—Net | 1,212 | 431 | 2,930 | 4,921 | ||||||||||
Income before Interest Charges | $ | 100,001 | $ | 37,263 | $ | 144,703 | $ | 153,791 | ||||||
Interest Charges | 7,842 | 10,237 | 37,922 | 43,218 | ||||||||||
Net Income | $ | 92,159 | $ | 27,026 | $ | 106,781 | $ | 110,573 | ||||||
Dividends on Preferred Stock | 1,111 | 1,367 | 4,739 | 5,210 | ||||||||||
Net Income Available for Common Stock | $ | 91,048 | $ | 25,659 | $ | 102,042 | $ | 105,363 | ||||||
Kentucky Utilities Company and Subsidiary
Consolidated Income Statements
(In thousands of dollars)
(Unaudited)
| Three Months Ended December 31, | Twelve Months Ended December 31, | ||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2001 | 2000 | 2001 | 2000 | ||||||||||
Operating Revenues | $ | 211,950 | $ | 212,854 | $ | 859,472 | $ | 851,941 | ||||||
Operating Expenses | ||||||||||||||
Fuel for electric generation | $ | 59,889 | $ | 56,830 | $ | 236,985 | $ | 219,923 | ||||||
Power purchased | 41,115 | 44,730 | 157,161 | 166,918 | ||||||||||
Non-recurring charges | (56,921 | ) | (11,030 | ) | 6,867 | — | ||||||||
Other operating & maintenance expenses | 48,820 | 45,006 | 175,380 | 169,715 | ||||||||||
Depreciation and amortization | 18,494 | 24,900 | 90,299 | 98,256 | ||||||||||
Federal and state income taxes | 35,875 | 15,109 | 57,482 | 51,963 | ||||||||||
Property and other taxes | 1,639 | 3,999 | 13,928 | 17,030 | ||||||||||
Total operating expenses | $ | 148,911 | $ | 179,544 | $ | 738,102 | $ | 723,805 | ||||||
Net Operating Income | $ | 63,039 | $ | 33,310 | $ | 121,370 | $ | 128,136 | ||||||
Other Income—Net | 3,234 | 1,542 | 8,932 | 6,843 | ||||||||||
Income before Interest Charges | $ | 66,273 | $ | 34,852 | $ | 130,302 | $ | 134,979 | ||||||
Interest Charges | 10,284 | 9,517 | 34,024 | 39,455 | ||||||||||
Net Income Before Cumulative Effect of Change in Accounting | $ | 55,989 | $ | 25,335 | $ | 96,278 | $ | 95,524 | ||||||
Cumulative Effect of Change in Accounting for Derivatives, Net of Income Taxes | — | — | 136 | — | ||||||||||
Net Income | $ | 55,989 | $ | 25,335 | $ | 96,414 | $ | 95,524 | ||||||
Dividends on Preferred Stock | 564 | 564 | 2,256 | 2,256 | ||||||||||
Net Income Available for Common Stock | $ | 55,425 | $ | 24,771 | $ | 94,158 | $ | 93,268 | ||||||
LG&E Energy Corp. Reports 2001 Utility Earnings
Full-Year 2001 Results
Fourth Quarter 2001 Results
Louisville Gas & Electric Company and Subsidiary Consolidated Income Statements (In thousands of dollars) (Unaudited)
Kentucky Utilities Company and Subsidiary Consolidated Income Statements (In thousands of dollars) (Unaudited)