UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(Mark One)
(X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 1994
---------------------
OR
( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from to
-------------------- -------------------
Commission file number 1-7727
-----------------------------------------------------
CONNECTICUT NATURAL GAS CORPORATION
----------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Connecticut 06-0383860
----------------------------------------------------------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
100 Columbus Boulevard, Hartford, Connecticut 06103
----------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
(203) 727-3000
----------------------------------------------------------------------------
(Registrant's telephone number, including area code)
----------------------------------------------------------------------------
(Former name, former address and former fiscal year, if changed since last
report).
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act
of 1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days. Yes X No
----- -----
Indicate the number of shares outstanding of each of the issuer's
classes of common stock, as of the latest practicable date (applicable only
to Corporate Issuers). Number of shares of common stock outstanding as of
the close of business on July 29, 1994: 9,539,078.
FINANCIAL STATEMENTS
CONNECTICUT NATURAL GAS CORPORATION
The condensed financial statements included herein have been prepared
by the Company, without audit, pursuant to the rules and regulations of the
Securities and Exchange Commission. Certain information and footnote
disclosures normally included in financial statements prepared in accordance
with generally accepted accounting principles have been condensed or omitted
pursuant to such rules and regulations. Although the Company believes that
the disclosures are adequate to make the information presented not
misleading, it is suggested that these condensed financial statements be
read in conjunction with the financial statements and the notes thereto
included in the Company's latest annual report on Form 10-K. In the opinion
of the Company, all adjustments necessary to present fairly the consolidated
financial position of the Connecticut Natural Gas Corporation as of June 30,
1994 and 1993 and the results of its operations and its cash flows for the
three months, nine months and twelve months ended June 30, 1994 and 1993
have been included. The results of operations for such interim periods are
not necessarily indicative of the results for the full year.
"UNAUDITED"
CONNECTICUT NATURAL GAS CORPORATION
CONSOLIDATED BALANCE SHEETS
(Thousands of Dollars)
June 30, Sept. 30, June 30,
ASSETS 1994 1993 1993
------ --------- --------- ---------
Plant and Equipment:
Regulated energy $ 354,554 $ 340,728 $ 315,517
Nonregulated energy 62,481 61,447 59,968
Construction work in progress 1,305 1,355 1,430
--------- --------- ---------
418,340 403,530 376,915
Less-Allowance for depreciation 116,478 106,919 103,987
--------- --------- ---------
301,862 296,611 272,928
--------- --------- ---------
Investments, at equity 5,154 4,874 4,672
--------- --------- ---------
Current Assets:
Cash and cash equivalents 1,093 1,546 1,303
Accounts and notes receivable 48,110 29,979 39,003
Allowance for doubtful accounts (5,188) (3,068) (3,463)
Accrued utility revenue 2,668 4,632 3,286
Inventories 15,989 20,413 13,554
Prepaid expenses 2,101 3,379 1,013
--------- --------- ---------
64,773 56,881 54,696
--------- --------- ---------
Deferred Charges and Other Assets:
Unrecovered future taxes 53,181 51,023 50,798
Recoverable transition costs 14,903 15,000 -
Other assets 20,267 20,196 29,778
--------- --------- ---------
88,351 86,219 80,576
--------- --------- ---------
$ 460,140 $ 444,585 $ 412,872
========= ========= =========
"UNAUDITED"
CONNECTICUT NATURAL GAS CORPORATION
CONSOLIDATED BALANCE SHEETS (Concluded)
(Thousands of Dollars)
June 30, Sept. 30, June 30,
CAPITALIZATION AND LIABILITIES 1994 1993 1993
------------------------------ --------- --------- ---------
Capitalization:
Common Stock $ 29,820 $ 29,820 $ 29,820
Capital in excess of par value 66,700 66,915 66,802
Retained Earnings 49,915 39,744 46,056
--------- --------- ---------
146,435 136,479 142,678
Unearned compensation -
Restricted stock awards (402) (157) (332)
Treasury stock (103) - -
--------- --------- ---------
Common stock equity 145,930 136,322 142,346
Preferred stock, not subject to
mandatory redemption 939 944 952
Long-term debt 136,497 137,984 105,877
--------- --------- ---------
283,366 275,250 249,175
--------- --------- ---------
Notes Payable Under Revolving Credit
Agreements - 4,500 5,200
--------- --------- ---------
Current Liabilities:
Current portion of long-term debt 4,006 4,653 4,150
Notes payable and commercial paper 20,800 10,000 22,900
Accounts payable and accrued expenses 35,111 42,084 21,801
Refundable purchased gas costs 10,002 3,758 10,652
Accrued liabilities 3,682 4,528 267
--------- --------- ---------
73,601 65,023 59,770
--------- --------- ---------
Deferred Credits:
Deferred income taxes 33,902 27,450 33,899
Unfunded deferred income taxes 55,339 51,023 50,798
Investment tax credits 3,699 3,864 3,919
Refundable taxes 3,943 4,024 4,308
Accrued transition costs 3,229 7,678 -
Other 3,061 5,773 5,803
--------- --------- ---------
103,173 99,812 98,727
--------- --------- ---------
$ 460,140 $ 444,585 $ 412,872
========= ========= =========
"UNAUDITED"
CONNECTICUT NATURAL GAS CORPORATION
CONSOLIDATED STATEMENTS OF INCOME
(Thousands of dollars except for per share data)
Three Months Ended
June 30,
-----------------------------
1994 1993
---------- ----------
Operating Revenues $ 50,003 $ 42,267
Less: Cost of Energy 26,669 20,963
State Gross Receipts Tax 1,851 1,828
---------- ----------
Operating Margin 21,483 19,476
---------- ----------
Other Operating Expenses:
Operations & maintenance expenses 14,031 12,702
Depreciation 4,073 3,196
Income taxes (835) (25)
Other taxes 1,772 1,427
---------- ----------
19,041 17,300
---------- ----------
Operating Income 2,442 2,176
---------- ----------
Other Income (Deductions):
Allowance for equity funds used
during construction 4 570
Equity in partnership earnings 184 230
Other deductions (73) (175)
Income Taxes (109) (116)
---------- ----------
6 509
---------- ----------
Interest and Debt Expense 3,356 2,562
---------- ----------
Net Income (908) 123
Less-Dividends on Preferred Stock 16 16
---------- ----------
Net Income Applicable to Common Stock $ (924) $ 107
========== ==========
Income Per Average Share of
Common Stock $ (0.10) $ 0.01
========== ==========
Dividends Per Share of Common Stock $ 0.37 $ 0.37
========== ==========
Average Common Shares Outstanding
During the Period 9,539,078 9,542,216
========== ==========
[CAPTION]
CONNECTICUT NATURAL GAS CORPORATION "UNAUDITED"
CONSOLIDATED STATEMENTS OF INCOME
(Thousands of dollars except for per share data)
Nine Months Ended
June 30,
-----------------------------
1994 1993
---------- ----------
Operating Revenues $ 252,708 $ 225,215
Less: Cost of Energy 136,766 121,883
State Gross Receipts Tax 10,326 9,684
---------- ----------
Operating Margin 105,616 93,648
---------- ----------
Operating Expenses:
Operations & maintenance expenses 42,438 35,505
Depreciation 11,438 9,497
Income taxes 15,500 15,767
Other taxes 5,622 5,050
---------- ----------
74,998 65,819
---------- ----------
Operating Income 30,618 27,829
---------- ----------
Other Income (Deductions):
Allowance for equity funds used
during construction 34 631
Equity in partnership earnings 636 516
Other deductions (977) (496)
Income Taxes 79 (225)
---------- ----------
(228) 426
---------- ----------
Interest and Debt Expense 9,582 8,636
---------- ----------
Net Income 20,808 19,619
Less-Dividends on Preferred Stock 49 50
---------- ----------
Net Income Applicable to Common Stock $ 20,759 $ 19,569
========== ==========
Income Per Average Share of
Common Stock $ 2.18 $ 2.05
========== ==========
Dividends Per Share of Common Stock $ 1.11 $ 1.09
========== ==========
Average Common Shares Outstanding
During the Period 9,539,903 9,522,878
========== ==========
CONNECTICUT NATURAL GAS CORPORATION "UNAUDITED"
CONSOLIDATED STATEMENTS OF INCOME
(Thousands of dollars except for per share data)
Twelve Months Ended
June 30,
-----------------------------
1994 1993
---------- ----------
Operating Revenues $ 292,830 $ 260,590
Less: Cost of Energy 160,787 138,924
State Gross Receipts Tax 11,737 11,240
---------- ----------
Operating Margin 120,306 110,426
---------- ----------
Operating Expenses:
Operations & maintenance expenses 54,111 48,821
Depreciation 14,590 12,478
Income taxes 13,171 14,118
Other taxes 7,459 7,113
---------- ----------
89,331 82,530
---------- ----------
Operating Income 30,975 27,896
---------- ----------
Other Income (Deductions):
Allowance for equity funds used
during construction 10 637
Equity in partnership earnings 1,090 616
Other income (deductions) (1,095) (418)
Income Taxes (248) 143
---------- ----------
(243) 978
---------- ----------
Interest and Debt Expense 12,688 12,786
---------- ----------
Net Income 18,044 16,088
Less-Dividends on Preferred Stock 66 67
---------- ----------
Net Income Applicable to Common Stock $ 17,978 $ 16,021
========== ==========
Income Per Average Share of
Common Stock $ 1.88 $ 1.72
========== ==========
Dividends Per Share of Common Stock $ 1.48 $ 1.45
========== ==========
Average Common Shares Outstanding
During the Period 9,540,506 9,322,222
========== ==========
"UNAUDITED"
CONNECTICUT NATURAL GAS CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Thousands of Dollars)
Three Months Ended
June 30,
----------------------
1994 1993
---- ----
Cash Flows from Operations $ 6,540 $ 6,536
-------- --------
Cash Flows from Investing Activities:
Capital expenditures (5,802) (4,586)
Other investing activities (1,262) (2,831)
-------- --------
Net cash used in investing activities (7,064) (7,417)
-------- --------
Cash Flows from Financing Activities:
Dividends paid (3,545) (3,547)
Issuance of common stock 74 28
Other stock activity, net - 3
Principal retired on long-term debt (512) (14,543)
Short-term debt 4,200 18,600
-------- --------
Net cash provided (used) by
financing activities 217 541
-------- --------
Increase (Decrease) in Cash and
Cash Equivalents (307) (340)
Cash and Cash Equivalents at
Beginning of Period 1,399 1,643
-------- --------
Cash and Cash Equivalents at
End of Period $ 1,092 $ 1,303
======== ========
"UNAUDITED"
CONNECTICUT NATURAL GAS CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS (Concluded)
(Thousands of Dollars)
Three Months Ended
June 30,
----------------------
1994 1993
---- ----
Schedule Reconciling Earnings to
Cash Flows from Operations:
Income $ (908) $ 123
-------- --------
Adjustments to reconcile income
to net cash:
Depreciation and amortization 4,173 3,282
Deferred income taxes, net (3,744) (355)
Undistributed affiliate earnings (184) (230)
Change in assets and liabilities:
Accounts receivable 18,759 23,349
Accrued utility revenue 9,908 7,702
Inventories (8,659) (8,962)
Unrecovered/(refundable)
purchased gas costs (5,857) (3,089)
Prepaid expenses 387 163
Accounts payable and accrued expenses (7,448) (15,469)
Other assets/liabilities 113 22
-------- --------
Total adjustments 7,448 6,413
-------- --------
Cash flows from operations $ 6,540 $ 6,536
======== ========
Supplemental Disclosures of Cash Flow
Information:
Cash Paid During the Year for:
Interest (net of amount capitalized) $ 4,099 $ 3,508
======== ========
Income taxes $ 5,618 $ 4,150
======== ========
"UNAUDITED"
CONNECTICUT NATURAL GAS CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Thousands of Dollars)
Nine Months Ended
June 30,
----------------------
1994 1993
---- ----
Cash Flows from Operations $ 27,655 $ 17,745
-------- --------
Cash Flows from Investing Activities:
Capital expenditures (14,695) (13,718)
Other investing activities (6,375) (2,516)
-------- --------
Net cash used in investing activities (21,070) (16,234)
-------- --------
Cash Flows from Financing Activities:
Dividends paid (10,637) (10,451)
Issuance of common stock 147 16,624
Other stock activity, net (715) (7)
Principal retired on long-term debt (2,134) (16,864)
Short-term debt 6,300 10,150
-------- --------
Net cash provided by
financing activities (7,039) (548)
-------- --------
Decrease in Cash and
Cash Equivalents (454) 963
Cash and Cash Equivalents at
Beginning of Period 1,546 340
-------- --------
Cash and Cash Equivalents at
End of Period $ 1,092 $ 1,303
======== ========
"UNAUDITED"
CONNECTICUT NATURAL GAS CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS (Concluded)
(Thousands of Dollars)
Nine Months Ended
June 30,
----------------------
1994 1993
---- ----
Schedule Reconciling Earnings to
Cash Flows from Operations:
Income $ 20,808 $ 19,619
-------- --------
Adjustments to reconcile income
to net cash:
Depreciation and amortization 11,752 9,773
Deferred income taxes, net 8,405 7,194
Undistributed affiliate earnings (636) (516)
Change in assets and liabilities:
Accounts receivable (16,011) (9,500)
Accrued utility revenue 1,964 1,007
Inventories 4,424 (214)
Unrecovered/(refundable)
purchased gas costs 6,244 (1,670)
Prepaid expenses 1,278 1,345
Accounts payable and accrued expenses (7,819) (9,533)
Other assets/liabilities (2,754) 240
-------- --------
Total adjustments 6,847 (1,874)
-------- --------
Cash flows from operations $ 27,655 $ 17,745
======== ========
Supplemental Disclosures of Cash Flow
Information:
Cash Paid During the Year for:
Interest (net of amount capitalized) $ 8,924 $ 7,618
======== ========
Income taxes $ 8,324 $ 8,805
======== ========
"UNAUDITED"
CONNECTICUT NATURAL GAS CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Thousands of Dollars)
Twelve Months Ended
June 30,
----------------------
1994 1993
---- ----
Cash Flows from Operations $ 31,833 $ 16,780
-------- --------
Cash Flows from Investing Activities:
Capital expenditures (26,508) (24,649)
Other investing activities (14,239) (5,523)
-------- --------
Net cash used in investing activities (40,747) (30,172)
-------- --------
Cash Flows from Financing Activities:
Dividends paid (14,185) (13,630)
Issuance of common stock 436 17,092
Other stock activity, net (724) (8)
Issuance of long-term debt 35,100 25,000
Principal retired on long-term debt (4,624) (29,331)
Short-term debt (7,300) 13,650
-------- --------
Net cash provided by
financing activities 8,703 12,773
-------- --------
Increase (decrease) in Cash and
Cash Equivalents (211) (619)
Cash and Cash Equivalents at
Beginning of Period 1,303 1,922
-------- --------
Cash and Cash Equivalents at
End of Period $ 1,092 $ 1,303
======== ========
"UNAUDITED"
CONNECTICUT NATURAL GAS CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS (Concluded)
(Thousands of Dollars)
Twelve Months Ended
June 30,
----------------------
1994 1993
---- ----
Schedule Reconciling Earnings to
Cash Flows from Operations:
Income $ 18,044 $ 16,088
-------- --------
Adjustments to reconcile income
to net cash:
Depreciation and amortization 15,007 12,889
Deferred income taxes, net 1,617 (636)
Undistributed affiliate earnings (1,090) (616)
Cash distributions received from
investments 251 -
Change in assets and liabilities:
Accounts receivable (7,382) (4,639)
Accrued utility revenue 618 437
Inventories (2,435) (5,243)
Unrecovered/(refundable)
purchased gas costs (650) (4,724)
Prepaid expenses (1,088) (214)
Accounts payable and accrued expenses 11,725 2,957
Other assets/liabilities (2,784) 481
-------- --------
Total adjustments 13,789 692
-------- --------
Cash flows from operations $ 31,833 $ 16,780
======== ========
Supplemental Disclosures of Cash Flow
Information:
Cash Paid During the Year for:
Interest (net of amount capitalized) $ 10,100 $ 9,315
======== ========
Income taxes $ 8,372 $ 11,172
======== ========
"UNAUDITED"
CONNECTICUT NATURAL GAS CORPORATION
NOTES TO FINANCIAL STATEMENTS
June 30, 1994
(Thousands of Dollars)
(1) Federal Energy Regulatory Commission (FERC) Order No. 636 Transition
Costs
The Company began to be billed for FERC Order No. 636 transition costs
from its pipeline suppliers in June, 1993. Through June, 1994 the
Company has paid and deferred $6,700 of an estimated $15,000 of
potential transition costs. In July, 1994 the Connecticut Department
of Public Utility Control (DPUC) issued a decision allowing Connecticut
natural gas distribution companies to recover these costs from amounts
which would otherwise have been refunded to customers and the
opportunity, if necessary, for surcharges added to future customers'
bills. Pursuant to this decision, in July, 1994 the Company recognized
the full recovery of the $6,700 transition costs paid to date.
(2) Long-term Debt
In May, 1994 the DPUC issued a decision approving the Company's
application to establish a four-year, Medium Term Note (MTN) program.
The decision allows the Company to issue up to $75,000 of unsecured
MTNs at maturities not exceeding thirty years, at terms approved by the
DPUC.
In July, 1994 the Company issued $10,000 of MTNs at 7.82%, due 2004.
There are no call provisions or sinking fund requirements associated
with these MTNs. The proceeds were used by the regulated operations to
repay $5,000 of existing 4.88% short-term debt and for working capital.
(3) Environmental Matters
In May, 1994 the Company paid an immaterial amount to fulfill its
obligation as a potentially responsible party in connection with the
Yellow River Road Superfund site in Florida.
(4) Reclassifications
Certain prior year amounts have been reclassified to conform with
current year classifications.
"UNAUDITED"
CONNECTICUT NATURAL GAS CORPORATION
MANAGEMENT'S DISCUSSION AND ANALYSIS
JUNE 30, 1994
(Thousands of Dollars Except Per Share Amounts)
RESULTS OF OPERATIONS
Higher net income and earnings per share have been recorded for the nine
months and twelve months ended June, 1994, as compared to 1993. However, a
net loss has been recorded for the quarter ending June, 1994, compared to
net income recorded in the third quarter of fiscal 1993. Higher operating
margins were realized throughout 1994, and all reported periods include
benefits from lower income taxes because of increased deductions. However,
in the three months ended June, 1994 increases in operating and maintenance
expenses and interest and debt expense and substantially lower other income
more than offset higher margins and lower income taxes.
Operating Margin
Higher operating margin has been recorded in fiscal 1994, principally due to
higher firm rates effective December, 1993. All 1994 reported periods also
benefited from a portion of a pipeline refund and greater interruptible
margins retained by the Company. Nine months and twelve months ended June,
1994 higher operating margins have also been supported by higher firm sales,
because of colder weather, lower gas costs, and higher margins earned on
interruptible sales and off-system contract sales. Three months ended June,
1994 recorded lower firm sales as a result of a milder spring and higher
interruptible sales.
Nonregulated district heating and cooling operations (DHC) continue to
contribute more to operating margin in fiscal 1994 because of the last
phase-in of new steam and hot water rates in January, 1994 and lower
variable costs associated with purchased steam and hot water.
Income Taxes
In the quarter ended June, 1994, conforming to industry practice, the
Company recorded previously unrecognized deductions relating to cost of
removal expenses for the retirements of plant and equipment. The Company
has requested and expects to receive approval for this change from the
Internal Revenue Service. This has provided a benefit to earnings from
lower income taxes of $725 or $.08 per share for the three, nine and twelve
months ended June, 1994 and will be an ongoing benefit from this point
forward. Additional flow-through depreciation deductions associated with a
major capitalized software system has provided a nine and twelve months
ended June, 1994 benefit to earnings of $933 or $.10 per share from lower
income taxes and offset higher Federal and State income taxes related to
improved results of operations during these periods.
Operations and Maintenance Expenses
Higher operations and maintenance expenses were recorded in 1994 as compared
to 1993 for all periods presented. The most significant factor for this
increase is the recording of additional uncollectibles expenses, including
receivable amounts forgiven under the Company's state mandated hardship
arrearage forgiveness program, as allowed in the December, 1993 rate
decision. Increases also occurred in costs for computer rentals, labor,
employee benefits, workers compensation (due to premium credits received in
1993), conservation programs, environmental monitoring services, regulatory
commission expenses and outside purchased services. These were partially
offset by lower other administrative and general expenses and by higher net
charge service revenues.
Other Income (Deductions)
Fiscal 1993 included unusually high income from an allowance for equity
funds used during construction, a result of a major long-term capital
project completed in 1993. There is no similar project in fiscal 1994. This
is the principal reason why other income (deductions) is a substantially
lower positive amount in the three months ended June, 1994 and a deduction
to net income for the nine and twelve months ended June, 1994. Net other
deductions also include higher promotional advertising expenses in all
reported periods and lower income from merchandising and jobbing activities
in the quarter and nine months ended June, 1994.
Interest and Debt Expense
Higher short-term borrowing rates on higher average borrowing levels and a
substantially lower 1994 allowance for borrowed funds used during
construction have increased the Company's interest and debt expense in 1994.
Offsetting these factors is the benefit of lower long-term debt interest
rates, as a result of the debt refinancings completed in fiscal 1993.
MATERIAL CHANGES IN FINANCIAL CONDITION
Cash flows from operations provided working capital and funding for
construction and other investing and financing activities in the nine months
ended June, 1994. In the quarter and twelve months ended June, 1994 cash
flows from operations and from financing activities together provided
working capital and funding for construction and other investing activities.
Cash flows from operating activities were higher in 1994, as compared to
1993, for all reported periods. These higher levels are a result of the
higher operating margins, the timing of the receipt of cash payments from
customers, the amount and timing of payments of invoices for volumes of gas
purchased to serve customers, and a refund received from a pipeline supplier
during the quarter ended June, 1994.
In May, 1994 the Connecticut Department of Public Utility Control (DPUC)
issued a decision approving the Company's application to establish a four-
year, Medium Term Note (MTN) program. The decision allows the Company to
issue up to $75,000 of unsecured MTNs at maturities not exceeding thirty
years, at terms approved by the DPUC.
In July, 1994 the Company issued $10,000 of MTNs at 7.82%, due 2004. There
are no call provisions or sinking fund requirements associated with these
MTNs. The proceeds were used by the regulated operations to repay $5,000 of
existing 4.88% short-term debt and for working capital.
Federal Energy Regulatory Commission (FERC) Order No. 636 Transition Costs
The Company began to be billed for FERC Order No. 636 transition costs from
its pipeline suppliers in June, 1993. Through June, 1994 the Company has
paid and deferred $6,700 of an estimated $15,000 of potential transition
costs. In July, 1994 the DPUC issued a decision allowing Connecticut
natural gas distribution companies to recover these costs from amounts which
would otherwise have been refunded to customers and the opportunity, if
necessary, for surcharges added to future customers' bills. Pursuant to
this decision, in July, 1994 the Company recognized the full recovery of the
$6,700 transition costs paid to date.
Environmental Matters
In May, 1994 the Company paid an immaterial amount to fulfill its obligation
as a potentially responsible party in connection with the Yellow River Road
Superfund site in Florida.
In May, 1994 the DHC received a notice of violation (NOV) from the State of
Connecticut Department of Environmental Protection (DEP). The NOV cites
failure to accurately and completely monitor discharges of non-contact
cooling water into the Connecticut River. Management is of the opinion that
the NOV is primarily related to issues of record keeping, measurement and
calculation methods. The Company's representatives have met with DEP
officials and have submitted a response to the DEP describing proposed
corrective actions. Several corrective measures have already been
implemented at this time. To date, DEP has not imposed any fines on the
Company related to this NOV.
PART II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
-----------------------------------------
(a) Exhibits
None
(b) A report on Form 8-K was filed on May 23, 1994 to file with the
Commission, under Item 5. Other Information, the contents of the
Decision issued by the State of Connecticut Department of Public
Utility Control on May 11, 1994 approving the Company's program to
issue up to $75 million of Medium Term Notes.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
CONNECTICUT NATURAL GAS CORPORATION
Date 08/03/94 By: S/ Andrew H. Johnson
-------------------- -----------------------------------
(Andrew H. Johnson)
Treasurer and Chief Accounting Officer
(On behalf of the registrant and as
Chief Accounting Officer)