EXHIBIT 99.(b)
FLORIDA PROGRESS CORPORATION
INVESTOR INFORMATION
Analysts' Contacts:
Mark A. Myers, Manager, Investor Relations (813)866-4245
John A. Serba, Senior Investor Communications Analyst (813)866-4247
July 20, 1995
Florida Progress Corporation reports slight increase in second-quarter earnings
Florida Progress Corporation, parent of St. Petersburg-based Florida Power
Corporation, today reported second-quarter earnings of $55.2 million, or 58
cents per share, compared with $53.7 million, or 58 cents a share, earned a year
ago. Revenues for the quarter totaled $742.9 million, compared with $693.2
million for the same three-month period in 1994. Prior-year amounts have been
restated to include the 1994 results for FM Industries, Inc., to reflect the
pooling of interests accounting.
Significant items influencing second-quarter operating results:
o Higher energy sales at Florida Power in 1995 due to customer growth
and a stronger economy.
o Impact of cost-cutting measures implemented by the utility.
o Revenue decoupling's negative effect on earnings from residential
revenues.
o Weaker results this year from Electric Fuels Corporation, Florida
Progress' coal-mining and transportation subsidiary.
Florida Power, the largest subsidiary of Florida Progress, earned $50.6 million,
or 53 cents per share, on revenues of $550.5 million in this year's second
quarter, compared with earnings of $47.6 million, or 51 cents a share, on
revenues of $517 million for the same three-month period a year ago.
Retail kilowatt-hour sales at Florida Power increased by 4.6 percent in the
second quarter of 1995, compared with the prior-year quarter. Customer growth
of about 2 percent and a stronger economy contributed to the improved energy
sales.
Second-quarter 1995 earnings benefited from savings that have resulted from
cost-control initiatives at the utility. Partially offsetting higher energy
sales and cost-reduction efforts were increased expenses for purchased power
capacity costs, nuclear decommissioning, depreciation, and property taxes during
the quarter.
In January 1995, the Florida Public Service Commission ordered Florida Power to
begin a three-year test of a revenue decoupling plan for its residential sales.
The plan separates, or decouples, revenues from energy sales. Decoupling is
designed to reconcile, or "true up," the revenues to an authorized target level.
As a result, abnormal weather variances will no longer impact earnings with
respect to residential revenues. Although residential kilowatt-hour sales for
the second quarter of 1995 were higher due to the unusually hot temperatures,
the decoupling mechanism eliminated the earnings impact of this extreme weather.
Residential revenues would have been about $13 million higher in the second
quarter of 1995 if not for revenue decoupling.
Diversified earnings were $4.6 million, or 5 cents per share, in the quarter,
compared with $6.1 million, or 7 cents a share, earned last year. Earnings from
Electric Fuels Corporation were lower than the same period in 1994, primarily
due to its offshore marine operations.
Six-Month Summary of Operating Results
Florida Progress' earnings for the first six months of 1995 were $101.8 million,
or $1.07 per share, compared with $90.2 million, or 99 cents a share, earned for
the same six-month period in 1994. Revenues in 1995 were $1.45 billion,
compared with $1.33 billion for the first six months a year ago. The increased
earnings arise from higher energy sales and continuing cost-control efforts at
Florida Power and improved results at Electric Fuels' inland marine division,
with operations on the Mississippi and Ohio rivers.
Florida Power's earnings for the first six months of this year were $91.4
million, or 96 cents per share, on revenues of $1.07 billion. During the same
six-month period in 1994, utility earnings were $79.4 million, or 87 cents a
share, on revenues of $1 billion.
Florida Progress (NYSE: FPC) is a Fortune 500 diversified utility holding
company with assets of $5.7 billion. Its principal subsidiary is Florida Power,
the state's second-largest electric utility with more than 1.2 million
customers. Diversified operations include coal mining and transportation, life
insurance, real estate and lending and leasing.
FLORIDA PROGRESS CORPORATION
CONSOLIDATED STATEMENTS OF INCOME Page 3
(In millions, except per share amounts)
Three Months Ended Six Months Ended Twelve Months Ended
June 30 June 30 June 30
------------------ ------------------ ------------------
(UNAUDITED) 1995 1994 1995 1994 1995 1994
-------- -------- -------- -------- -------- --------
REVENUES:
Electric utility $550.5 $517.0 $1,066.4 $1,000.5 $2,146.4 $2,089.2
Diversified 192.4 176.2 379.7 331.9 738.8 645.6
--------- --------- --------- --------- --------- ---------
742.9 693.2 1,446.1 1,332.4 2,885.2 2,734.8
EXPENSES: --------- --------- --------- --------- --------- ---------
Electric utility:
Fuel used in generation 113.1 127.9 191.7 218.6 405.0 458.4
Purchased power 107.5 80.4 210.8 136.7 368.7 265.1
Deferred fuel (8.6) (34.6) (1.2) (19.4) 16.7 (4.2)
Other operation 85.7 100.3 173.1 208.4 353.5 410.2
--------- --------- --------- --------- --------- ---------
Operation 297.7 274.0 574.4 544.3 1,143.9 1,129.5
Maintenance 28.1 33.2 61.1 63.4 120.6 133.8
Depreciation 70.8 64.9 141.5 129.4 273.6 252.8
Taxes other than income taxes 44.9 40.8 87.8 81.0 169.6 161.3
--------- --------- --------- --------- --------- ---------
441.5 412.9 864.8 818.1 1,707.7 1,677.4
--------- --------- --------- --------- --------- ---------
Diversified:
Cost of sales 159.6 144.4 312.5 273.7 610.0 528.2
Other 18.2 14.1 34.9 27.5 70.7 57.8
--------- --------- --------- --------- --------- ---------
177.8 158.5 347.4 301.2 680.7 586.0
--------- --------- --------- --------- --------- ---------
INCOME FROM OPERATIONS 123.6 121.8 233.9 213.1 496.8 471.4
--------- --------- --------- --------- --------- ---------
INTEREST EXPENSE AND OTHER:
Interest expense 36.0 36.6 72.6 72.8 144.6 143.0
Allowance for funds used during
construction (1.6) (2.9) (3.8) (5.5) (9.2) (12.5)
Preferred dividend requirements of
Florida Power 2.4 2.5 4.9 5.0 10.0 11.3
Other expense, net 0.5 1.0 1.3 1.6 10.0 0.1
--------- --------- --------- --------- --------- ---------
37.3 37.2 75.0 73.9 155.4 141.9
--------- --------- --------- --------- --------- ---------
INCOME BEFORE INCOME TAXES 86.3 84.6 158.9 139.2 341.4 329.5
Income Taxes 31.1 30.9 57.1 49.0 117.8 120.1
--------- --------- --------- --------- --------- ---------
NET INCOME $55.2 $53.7 $101.8 $90.2 $223.6 $209.4
========= ========= ========= ========= ========= =========
AVERAGE SHARES OF COMMON STOCK
OUTSTANDING 95.6 92.3 95.4 91.2 95.1 90.0
========= ========= ========= ========= ========= =========
EARNINGS PER AVERAGE COMMON SHARE $0.58 $0.58 $1.07 $0.99 $2.35 $2.33
========= ========= ========= ========= ========= =========
Regarding these financial statements:
Prior-year amounts have been restated to include the 1994 results for FM Industries to reflect
the pooling of interests accounting. These are interim statements. Reference should be made to
Florida Progress Corporation's 1994 Annual Report to shareholders. Neither this report nor any
statement contained herein is furnished in connection with the offering of securities or for the
purpose of promoting or influencing the sale or purchase of securities.
FLORIDA PROGRESS CORPORATION
CONSOLIDATED BALANCE SHEETS Page 4
(In millions)
June 30
------------------------
(UNAUDITED) 1995 1994
----------- -----------
ASSETS
PROPERTY, PLANT AND EQUIPMENT:
Electric utility plant in service and held for
for future use $5,735.6 $5,422.3
Less - Accumulated depreciation 2,094.8 1,916.2
Accumulated decommissioning for nuclear plant 147.9 124.7
Accumulated dismantlement for fossil plants 96.1 80.4
---------- ----------
3,396.8 3,301.0
Construction work in progress 201.4 264.8
Nuclear fuel, net of amortization of $335.8
in 1995 and $309.5 in 1994 40.7 66.1
---------- ----------
Net electric utility plant 3,638.9 3,631.9
Other property, net of depreciation of $175.9
in 1995 and $154.1 in 1994 429.0 401.5
---------- ----------
4,067.9 4,033.4
---------- ----------
CURRENT ASSETS:
Cash and equivalents 10.2 18.9
Accounts receivable, net 293.4 264.4
Current portion of leases and loans receivable 15.6 45.9
Inventories, primarily at average cost:
Fuel 88.8 88.3
Utility materials and supplies 111.9 112.7
Diversified materials 71.6 53.4
Underrecovery of fuel cost 8.4 31.9
Other 39.9 37.5
---------- ----------
639.8 653.0
---------- ----------
OTHER ASSETS:
Investments:
Leases and loans receivable, net 389.4 454.2
Marketable securities 169.2 148.0
Nuclear plant decommissioning fund 142.2 116.4
Joint ventures and partnerships 76.2 86.5
Deferred insurance policy acquisition costs 100.5 89.4
Other 160.5 170.8
---------- ----------
1,038.0 1,065.3
---------- ----------
$5,745.7 $5,751.7
========== ==========
CAPITAL AND LIABILITIES
CAPITAL:
Common stock equity $2,016.1 $1,940.9
Cumulative preferred stock of Florida Power 143.5 148.5
Long-term debt 1,811.2 1,860.5
---------- ----------
3,970.8 3,949.9
---------- ----------
CURRENT LIABILITIES:
Accounts payable 156.7 160.0
Customers' deposits 79.2 73.9
Income taxes payable 42.8 14.1
Accrued other taxes 48.9 43.9
Accrued interest 47.7 45.4
Other 79.6 65.2
---------- ----------
454.9 402.5
Notes payable 41.1 68.7
Current portion of long-term debt 28.6 85.9
---------- ----------
524.6 557.1
---------- ----------
DEFERRED CREDITS AND OTHER LIABILITIES:
Deferred income taxes 703.5 743.0
Unamortized investment tax credits 105.8 114.8
Insurance policy benefit reserves 242.8 206.9
Other postretirement benefit costs 76.2 58.2
Other 122.0 121.8
---------- ----------
1,250.3 1,244.7
---------- ----------
$5,745.7 $5,751.7
========== ==========
FLORIDA PROGRESS CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS Page 5
(In millions)
Three Months Ended Six Months Ended Twelve Months Ended
June 30 June 30 June 30
------------------ ------------------ ------------------
(UNAUDITED) 1995 1994 1995 1994 1995 1994
-------- -------- -------- -------- -------- --------
OPERATING ACTIVITIES:
Net income $55.2 $53.7 $101.8 $90.2 $223.6 $209.4
Adjustments for noncash items:
Depreciation and amortization 86.6 75.3 173.3 156.8 338.2 312.7
Deferred income taxes and
investment tax credits, net (37.6) 7.5 (50.6) (10.3) (72.6) (58.3)
Increase in accrued other postretirement
benefit costs 4.1 5.3 8.4 10.7 18.1 25.2
Net change in deferred insurance policy
acquisition costs (3.3) (4.3) (8.6) (7.9) (11.1) (14.1)
Net change in insurance policy
benefit reserves 9.5 10.6 20.3 20.4 35.9 32.9
Changes in working capital, net of effects
from acquisition or sale of businesses:
Accounts receivable (42.9) (36.4) (31.2) (18.6) (30.0) (35.7)
Inventories (11.3) (3.9) (18.6) (14.1) (14.6) (14.9)
Overrecovery (underrecovery)of fuel cost (11.3) (32.7) (6.6) (24.8) 23.5 5.4
Accounts payable 8.8 46.6 7.6 8.5 (5.1) 27.7
Income taxes payable (1.7) (29.3) 30.6 (28.2) 29.2 (3.7)
Accrued other taxes 18.9 17.1 33.9 33.0 4.7 4.4
Other 19.7 (8.2) 11.4 (6.0) 31.7 2.2
Other operating activities 2.8 (5.1) 11.7 17.4 17.3 27.5
-------- -------- -------- -------- -------- --------
97.5 96.2 283.4 227.1 588.8 520.7
-------- -------- -------- -------- -------- --------
INVESTING ACTIVITIES:
Property additions (including allowance for
borrowed funds used during construction) (75.8) (95.9) (148.5) (158.5) (358.1) (432.4)
Proceeds from sale of properties and businesses 3.0 7.9 6.6 12.3 10.6 38.0
Purchase of leases, loans and securities (3.5) (19.7) (14.5) (57.4) (31.2) (108.5)
Proceeds from sale or collection of
leases, loans and securities 25.1 17.2 48.7 48.9 102.0 147.0
Acquisition of businesses (5.8) (16.8) (5.8) (16.8) (6.1) (15.6)
Distributions from (investments in) joint
ventures and partnerships, net (1.6) (1.4) (2.4) (1.6) (2.1) (1.1)
Other investing activities (2.8) (2.6) (5.5) (5.5) (10.8) (11.0)
-------- -------- -------- -------- -------- --------
(61.4) (111.3) (121.4) (178.6) (295.7) (383.6)
-------- -------- -------- -------- -------- --------
FINANCING ACTIVITIES:
Issuance of long-term debt - 1.1 - 100.4 3.3 307.5
Repayment of long-term debt (19.2) (2.4) (29.2) (17.1) (98.8) (213.7)
Decrease in commercial paper with
long-term support (31.0) (16.1) (45.4) (87.8) (18.8) (122.5)
Redemption of preferred stock - - - - (5.0) (35.3)
Sale of common stock 9.6 104.8 19.0 118.0 39.0 146.8
Dividends paid on common stock (48.3) (46.2) (96.4) (90.5) (191.8) (177.5)
Increase (decrease) in short-term debt 41.1 (22.0) (14.2) (61.0) (28.8) (25.8)
Other financing activities - - - (0.7) (0.9) (1.5)
-------- -------- -------- -------- -------- --------
(47.8) 19.2 (166.2) (38.7) (301.8) (122.0)
-------- -------- -------- -------- -------- --------
NET INCREASE (DECREASE) IN CASH AND EQUIVALENTS (11.7) 4.1 (4.2) 9.8 (8.7) 15.1
Beginning cash and equivalents 21.9 14.8 14.4 9.1 18.9 3.8
-------- -------- -------- -------- -------- --------
ENDING CASH AND EQUIVALENTS $10.2 $18.9 $10.2 $18.9 $10.2 $18.9
======== ======== ======== ======== ======== ========
/TABLE
Florida Progress Corporation
Selected Financial Information (Unaudited) Page 6
Three Months Ended Percent Six Months Ended Percent Twelve Months Ended Percent
June 30 Positive June 30 Positive June 30 Positive
1995 1994 (Negative) 1995 1994 (Negative) 1995 1994 (Negative)
------- ------ --------- ------ ------ --------- ------ ------ --------
Earnings Per Share:
Florida Power Corporation $0.53 $0.51 3.9 $0.96 $0.87 10.3 $2.13 $2.11 0.9
--------- --------- --------- --------- --------- ---------
Electric Fuels Corporation 0.05 0.07 (28.6) 0.12 0.12 - 0.25 0.23 8.7
Mid-Continent Life Insurance Co. 0.02 0.02 - 0.04 0.04 - 0.08 0.09 (11.1)
Progress Credit Corporation:
Lending and leasing 0.00 0.01 (100.0) 0.01 0.01 - 0.01 0.02 (50.0)
Real estate (0.01) (0.02) 50.0 (0.04) (0.03) (33.3) (0.07) (0.08) 12.5
Corporate and other (0.01) (0.01) - (0.02) (0.02) - (0.05) (0.04) (25.0)
--------- --------- --------- --------- --------- ---------
Diversified 0.05 0.07 (28.6) 0.11 0.12 (8.3) 0.22 0.22 -
--------- --------- --------- --------- --------- ---------
Consolidated $0.58 $0.58 - $1.07 $0.99 8.1 $2.35 $2.33 0.9
========= ========= ========= ========= ========= =========
Avg. shares outstanding (millions) 95.6 92.3 3.6 95.4 91.2 4.6 95.1 90.0 5.7
Dividends per share $0.505 $0.495 2.0 $1.01 $0.99 2.0 $2.01 $1.97 2.0
Book value per share:
Florida Power Corporation $17.56 $17.18 2.2
Consolidated $21.04 $20.54 2.4
June 30 June 30
June 30 1995 1994
1995 1994 Amount Percent Amount Percent
--------- --------- ----------------------------------------
Equity investments (percent): Capitalization (in millions):
Florida Power Corporation 84 84 Common stock $2,016.1 49.9 $1,940.9 47.3
Electric Fuels Corporation 9 8 Preferred stock 143.5 3.6 148.5 3.6
Mid-Continent Life Insurance Co. 4 4 Long-term debt 1,811.2 44.8 1,860.5 45.3
Progress Credit Corporation 3 4 Short-term capital 69.7 1.7 154.6 3.8
--------- --------- ----------------------------------------
Total 100 100 Total $4,040.5 100.0 $4,104.5 100.0
========= ========= ========================================
Note: Prior-year amounts have been restated to include the 1994 results for FM Industries to reflect the pooling of interests
accounting.
Florida Power Corporation
Selected Statistical Data (Unaudited) Page 7
(In millions, except billing degree days)
Three Months Ended Six Months Ended Twelve Months Ended
June 30 Percent June 30 Percent June 30 Percent
1995 1994 Change 1995 1994 Change 1995 1994 Change
------- ------- ------- ------- ------- ------- ------- ------- -------
Revenues:
Residential $301.2 $272.8 10.4 $584.9 $540.3 8.3 $1,187.3 $1,148.2 3.4
Commercial 130.1 122.7 6.0 239.5 225.2 6.3 498.2 478.7 4.1
Industrial 48.4 44.0 10.0 91.5 83.7 9.3 180.9 167.8 7.8
Other retail sales 29.8 27.2 9.6 55.1 50.6 8.9 112.8 106.0 6.4
------- ------- -------- -------- -------- --------
509.5 466.7 9.2 971.0 899.8 7.9 1,979.2 1,900.7 4.1
Sales for resale 28.8 26.6 8.3 54.8 57.5 (4.7) 126.0 129.4 (2.6)
------- ------- -------- -------- -------- --------
538.3 493.3 9.1 1,025.8 957.3 7.2 2,105.2 2,030.1 3.7
Other electric revenues 9.5 25.4 (62.6) 35.3 37.7 (6.4) 48.2 61.0 (21.0)
Deferred fuel 2.7 (1.7) - 5.3 5.5 - (7.0) (1.9) -
------- ------- -------- -------- -------- --------
Total $550.5 $517.0 6.5 $1,066.4 $1,000.5 6.6 $2,146.4 $2,089.2 2.7
======= ======= ======== ======== ======== ========
Kilowatt-hour sales billed:
Residential 3,589.2 3,327.7 7.9 6,909.6 6,565.4 5.2 14,207.6 14,176.1 0.2
Commercial 2,211.9 2,125.0 4.1 3,982.1 3,848.7 3.5 8,385.5 8,186.5 2.4
Industrial 1,001.5 929.0 7.8 1,862.0 1,759.2 5.8 3,682.4 3,479.7 5.8
Other retail sales 539.6 504.9 6.9 982.7 931.1 5.5 2,031.7 1,956.7 3.8
------- ------- -------- -------- -------- --------
7,342.2 6,886.6 6.6 13,736.4 13,104.4 4.8 28,307.2 27,799.0 1.8
Sales for resale 436.9 426.0 2.6 879.2 940.8 (6.5) 2,277.8 2,293.1 (0.7)
------- ------- -------- -------- -------- --------
Total electric sales 7,779.1 7,312.6 6.4 14,615.6 14,045.2 4.1 30,585.0 30,092.1 1.6
======= ======= ======== ======== ======== ========
System Requirements (KWH) 8,585 8,293 3.5 15,798 15,167 4.2 31,805 31,611 0.6
Retail KWH Sales
(Billed & Unbilled) 7,553 7,223 4.6 13,968 13,383 4.4 28,184 27,848 1.2
Billing Degree Days:
Cooling 884 766 15.4 884 766 15.4 3,464 3,759 (7.8)
Heating 17 30 (43.3) 480 483 (0.6) 512 594 (13.8)
Note:
Total revenues include billed revenues and unbilled revenues that are accrued for accounting purposes.
Statistics for total kilowatt-hour sales include only billed kilowatt-hour sales. The statistic for retail KWH
sales includes both billed and unbilled sales. Beginning in 1995, Florida Power was ordered by state regulators
to conduct a three-year test for residential revenue decoupling. Under the plan, abnormal weather variances
will no longer impact earnings with respect to residential revenues.