SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 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, 1998
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 1-8809
SCANA Corporation
(Exact name of registrant as specified in its charter)
South Carolina 57-0784499
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1426 Main Street, Columbia, South Carolina 29201
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (803) 217-9000
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 .
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS:
Indicate by check mark whether the registrant has filed all
documents and reports required to be filed by Section 12, 13 or 15(d) of
the Securities Exchange Act of 1934 subsequent to the distribution of
securities under a plan confirmed by a court. Yes . No .
APPLICABLE ONLY TO CORPORATE ISSUERS:
Indicate the number of shares outstanding of each of the issuer's
classes of common stock, as of the latest practicable date.
105,664,513 Common Shares, without par value, as of June 30, 1998
SCANA CORPORATION
INDEX
PART I. FINANCIAL INFORMATION Page
Item 1. Financial Statements
Consolidated Balance Sheets as of June 30, 1998
and December 31, 1997..................................... 3
Consolidated Statements of Income and Retained Earnings
for the Periods Ended June 30, 1998 and 1997.............. 5
Consolidated Statements of Cash Flows for the Periods
Ended June 30, 1998 and 1997.............................. 6
Notes to Consolidated Financial Statements................ 7
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations....................... 12
Item 3. Quantitative and Qualitative Disclosure About Market Risk. 17
PART II. OTHER INFORMATION
Item 1. Legal Proceedings......................................... 17
Item 4. Submission of Matters to a Vote of Security-Holders....... 17
Item 6. Exhibits and Reports on Form 8-K.......................... 18
Signatures......................................................... 19
Exhibit Index...................................................... 20
2
PART I
FINANCIAL INFORMATION
Item 1. Financial Statements.
SCANA CORPORATION
CONSOLIDATED BALANCE SHEETS
As of June 30, 1998 and December 31, 1997
(Unaudited)
June 30, December 31,
1998 1997
(Millions of Dollars)
ASSETS
Utility Plant:
Electric................................................... $4,303 $4,292
Gas........................................................ 582 580
Other...................................................... 86 84
Total.................................................... 4,971 4,956
Less accumulated depreciation and amortization............. 1,679 1,619
Total.................................................... 3,292 3,337
Construction work in progress.............................. 331 234
Nuclear fuel, net of accumulated amortization.............. 44 53
Acquisition adjustment-gas, net of accumulated
amortization............................................. 24 24
Utility Plant, Net.................................... 3,691 3,648
Nonutility Property and Investments, net of
accumulated depreciation................................... 496 364
Current Assets:
Cash and temporary cash investments........................ 39 60
Receivables................................................ 284 248
Inventories (at average cost):
Fuel..................................................... 54 51
Materials and supplies................................... 51 52
Prepayments................................................ 26 16
Deferred income taxes...................................... 23 25
Total Current Assets.................................. 477 452
Deferred Debits:
Emission allowances........................................ 31 31
Environmental.............................................. 28 32
Nuclear plant decommissioning fund......................... 52 49
Pension asset, net......................................... 86 82
Other...................................................... 279 274
Total Deferred Debits................................. 476 468
Total....................................... $5,140 $4,932
See notes to consolidated financial statements.
3
SCANA CORPORATION
CONSOLIDATED BALANCE SHEETS
As of June 30, 1998 and December 31, 1997
(Unaudited)
June 30, December 31,
1998 1997
(Millions of Dollars)
CAPITALIZATION AND LIABILITIES
Stockholders' Investment:
Common Equity:
Common stock (without par value)......................... 1,092 1,153
Retained earnings........................................ 641 617
Net Unrealized Holding Gain on Securities................ 52 18
Total Common Equity.................................... $1,785 $1,788
Preferred stock (not subject to purchase or sinking funds). 106 106
Total Stockholders' Investment............................ 1,891 1,894
Preferred stock, net (subject to purchase or sinking funds).. 12 12
SCE&G Obligated Mandatorily Redeemable Preferred
Securities of SCE&G's Subsidiary Trust, SCE&G Trust I,
holding solely $50 million, principal amount of the 7.55%
Junior Subordinated Debentures of SCE&G, due 2027........ 50 50
Long-term debt, net.......................................... 1,560 1,566
Total Capitalization.................................. 3,513 3,522
Current Liabilities:
Short-term borrowings...................................... 219 59
Current portion of long-term debt.......................... 73 73
Accounts payable........................................... 152 131
Customer deposits.......................................... 18 18
Taxes accrued.............................................. 42 59
Interest accrued........................................... 26 26
Dividends declared......................................... 43 43
Other...................................................... 23 14
Total Current Liabilities............................. 596 423
Deferred Credits:
Deferred income taxes...................................... 651 612
Deferred investment tax credits............................ 96 98
Reserve for nuclear plant decommissioning.................. 52 49
Postretirement benefits.................................... 68 61
Other...................................................... 164 167
Total Deferred Credits................................ 1,031 987
Total....................................... $5,140 $4,932
See notes to consolidated financial statements.
4
<PAGE 5>
SCANA CORPORATION
CONSOLIDATED STATEMENTS OF INCOME AND RETAINED EARNINGS
For the Periods Ended June 30, 1998 and 1997
(Unaudited)
Three Months Ended Six Months Ended
June 30, June 30,
1998 1997 1998 1997
(Millions of Dollars, Except Per Share Amounts)
OPERATING REVENUES:
Electric........................................ $299 $247 $569 $500
Gas............................................. 88 84 224 216
Transit......................................... - 1 1 1
Total Operating Revenues.................... 387 332 794 717
OPERATING EXPENSES:
Fuel used in electric generation................ 68 55 128 109
Purchased power................................. 12 4 13 4
Gas purchased for resale........................ 61 55 145 138
Other operation................................. 60 56 120 112
Maintenance..................................... 22 21 41 36
Depreciation and amortization................... 39 38 68 77
Income taxes.................................... 26 19 63 50
Other taxes..................................... 25 23 51 49
Total Operating Expenses.................... 313 271 629 575
OPERATING INCOME.................................. 74 61 165 142
OTHER INCOME:
Allowance for equity funds used
during construction........................... 2 1 4 3
Other income, net of income taxes............... (1) - 2 7
Total Other Income.......................... 1 1 6 10
INCOME BEFORE INTEREST CHARGES AND
PREFERRED STOCK DIVIDENDS....................... 75 62 171 152
INTEREST CHARGES (CREDITS):
Interest expense on long term debt.............. 30 29 59 58
Other interest expense.......................... 2 3 4 6
Allowance for borrowed funds used
during construction........................... (2) (2) (4) (3)
Total Interest Charges, Net................. 30 30 59 61
INCOME BEFORE PREFERRED DIVIDEND REQUIREMENTS
ON MANDATORILY REDEEMABLE PREFERRED
SECURITIES 45 32 112 91
PREFERRED DIVIDEND REQUIREMENT OF SCE&G
- OBLIGATED MANDATORILY REDEEMABLE
PREFERRED SECURITIES 1 - 2 -
INCOME BEFORE PREFERRED STOCK CASH
DIVIDENDS OF SUBSIDIARY......................... 44 32 110 91
PREFERRED STOCK CASH DIVIDENDS OF
SUBSIDIARY (At stated rates).................... (2) (2) (4) (4)
NET INCOME........................................ 42 30 106 87
RETAINED EARNINGS AT BEGINNING OF PERIOD.......... 640 575 617 558
COMMON STOCK CASH DIVIDENDS DECLARED.............. (41) (41) (82) (81)
RETAINED EARNINGS AT END OF PERIOD................ $641 $564 $641 $564
NET INCOME........................................ $ 42 $ 30 106 $ 87
WEIGHTED AVERAGE NUMBER OF COMMON
SHARES OUTSTANDING (MILLIONS)................... 106.4 107.0 106.8 106.8
EARNINGS PER WEIGHTED AVERAGE SHARE
OF COMMON STOCK................................. $.40 $.28 $1.00 $.81
CASH DIVIDENDS DECLARED PER SHARE OF
COMMON STOCK...................................$.3850 $.3775 $.7700 $.7550
See notes to consolidated financial statements.
5
SCANA CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
For the Periods Ended June 30, 1998 and 1997
(Unaudited)
Six Months Ended
June 30,
1998 1997
(Millions of Dollars)
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income............................................ $106 $ 87
Adjustments to reconcile net income to net cash
provided from operating activities:
Depreciation, depletion and amortization............ 72 91
Amortization of nuclear fuel........................ 10 11
Deferred income taxes, net.......................... 21 8
Pension asset....................................... (4) (8)
Postretirement benefits............................. 7 6
Allowance for funds used during construction........ (8) (6)
Over (under) collections, fuel adjustment clauses... 9 16
Changes in certain current assets and liabilities:
(Increase) decrease in receivables................. (36) 32
(Increase) decrease in inventories................. (2) 10
(Increase) decrease in prepayments................. (10) (8)
Increase (decrease) in accounts payable............ 21 (46)
Increase (decrease) in taxes accrued............... (17) (16)
Other, net.......................................... (7) -
Net Cash Provided From Operating Activities............. 162 177
CASH FLOWS FROM INVESTING ACTIVITIES:
Utility property additions and construction
expenditures, net of AFC............................ (108) (98)
Increase in other property and investments............ (82) (41)
Sale of subsidiary assets............................. - 8
Net Cash Used For Investing Activities.................. (190) (131)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds:
Issuance of notes and loans......................... 60 25
Issuance of common stock............................ - 25
Issuance of preferred stock......................... - 99
Repayments:
Notes and loans..................................... (60) (15)
Other long-term debt................................ - (4)
Preferred stock..................................... - (2)
Repurchase of common stock.......................... (61) -
Dividend payments:
Common stock........................................ (81) (79)
Preferred stock of subsidiary....................... (4) (3)
Short-term borrowings, net............................ 160 (91)
Fuel and emission allowance financings, net........... (7) 2
Net Cash Provided (Used) For Financing Activities....... 7 (43)
NET INCREASE (DECREASE) IN CASH AND TEMPORARY
CASH INVESTMENTS........................................ (21) 3
CASH AND TEMPORARY CASH INVESTMENTS AT JANUARY 1........ 60 17
CASH AND TEMPORARY CASH INVESTMENTS AT JUNE 30 ......... $ 39 $ 20
SUPPLEMENTAL CASH FLOW INFORMATION:
Cash paid for - Interest (includes capitalized
interest of $4 and $3)............... $ 62 $ 62
- Income taxes.......................... 30 31
Noncash investing activities
- Unrealized gain (loss) on securities
available for sale (net of tax)...... 34 (3)
See notes to consolidated financial statements.
6
SCANA CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
June 30, 1998
(Unaudited)
The following notes should be read in conjunction with the
Notes to Consolidated Financial Statements appearing in SCANA
Corporation's (the Company) Annual Report on Form 10-K for the
year ended December 31, 1997. These are interim financial
statements, and the amounts reported in the Consolidated Statements
of Income are not necessarily indicative of amounts expected for
the year. In the opinion of management, the information furnished
herein reflects all adjustments, all of a normal recurring nature
except as described in Note 2, which are necessary for a fair
statement of the results for the interim periods reported.
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
A. Basis of Accounting
The Company accounts for its regulated utility operations,
assets and liabilities in accordance with the provisions of
Statement of Financial Accounting Standards No. 71 (SFAS 71).
The accounting standard requires cost-based rate-regulated
utilities to recognize in their financial statements revenues
and expenses in different time periods than do enterprises that
are not rate-regulated. As a result the Company has recorded,
as of June 30, 1998, approximately $238 million and $73
million of regulatory assets and liabilities, respectively,
including amounts recorded for deferred income tax assets
and liabilities of approximately $124 million and $58
million, respectively. The electric and gas regulatory assets
(excluding deferred income tax assets) of approximately $77
million and $35 million, respectively, are being recovered
through rates, and the Public Service Commission of South
Carolina (PSC) has approved accelerated recovery of
approximately $31 million of the electric regulatory assets.
In the future, as a result of deregulation or other changes in
the regulatory environment, the Company may no longer meet the
criteria for continued application of SFAS 71 and could be
required to write off its regulatory assets and liabilities.
Such an event could have a material adverse effect on the
Company's results of operations in the period the write-off is
recorded, but it is not expected that cash flows or financial
position would be materially affected.
B. Comprehensive Income
The Company has adopted the provisions of Statement of
Financial Accounting Standards No. 130, Reporting Comprehensive
Income, which is effective for fiscal years beginning after
December 15, 1997. The statement requires the disclosure of
the components of comprehensive income for each period for
which consolidated statements of income and retained earnings
are presented. Comprehensive income includes net income and
all other changes in equity except those resulting from
investments by and distributions to stockholders.
Comprehensive income of the Company totaled $45.4 million
and $140.0 million for the three and six months ended June
30, 1998, respectively, and $40.3 million and $84.2 million
for the same periods in 1997. For each period, comprehensive
income included net income and unrealized gains/losses on
securities available for sale.
C. Reclassifications
Certain amounts from prior periods have been reclassified to
conform with the 1998 presentation.
7
2. RATE MATTERS
On January 9, 1996 the PSC issued an order granting SCE&G an
increase in retail electric rates of 7.34%, which was designed
to produce additional revenues, based on a test year, of
approximately $67.5 million annually. The increase was
implemented in two phases. The first phase, an increase in
revenues of approximately $59.5 million annually or 6.47%,
commenced in January 1996. The second phase, an increase in
revenues of approximately $8.0 million annually, or .87%, was
implemented in January 1997. The PSC authorized a return on
common equity of 12.0%. The PSC also approved establishment
of a Storm Damage Reserve Account capped at $50 million to be
collected through rates over a ten-year period. Additionally,
the PSC approved accelerated recovery of a significant portion
of SCE&G's electric regulatory assets (excluding deferred
income tax assets) and the remaining transition obligation for
postretirement benefits other than pensions, changing the
amortization periods to allow recovery by the end of the
year 2000. SCE&G's request to shift, for ratemaking purposes,
approximately $257 million of depreciation reserves from
transmission and distribution assets to nuclear production
assets was also approved. The Consumer Advocate and two other
intervenors appealed certain issues in the order to the South
Carolina Circuit Court, which affirmed the PSC's decisions,
and, subsequently, to the South Carolina Supreme Court. In
March 1998, SCE&G, the PSC and the Consumer Advocate and one
of the other intervenors reached an agreement that provided for
the reversal of the shift in depreciation reserves and the
dismissal of the appeal of all other issues. The PSC also
authorized the Company to adjust depreciation rates that had
been approved in the 1996 rate order for its electric
transmission, distribution and nuclear production properties
to eliminate the effect of the depreciation reserve shift and
to retroactively apply such depreciation rates to February
1996. As a result, a one-time reduction in depreciation
expense of $5.5 million after taxes was recorded in March
1998. The agreement does not affect retail electric rates.
The remaining intervenor continues to contest establishment of
the Storm Damage Reserve Account and the authorized return on
common equity. The Supreme Court heard the case in April 1998
and is expected to issue a ruling during 1998. While the
outcome of this proceeding is uncertain, the Company does not
believe that any significant adverse change in the rate order
is likely. The Federal Energy Regulatory Commission (FERC) had
previously rejected the transfer of depreciation reserves for
rates subject to its jurisdiction.
3. RETAINED EARNINGS:
The Restated Articles of Incorporation of the Company do not
limit the dividends that may be payable on its common stock.
However, the Restated Articles of Incorporation of South
Carolina Electric & Gas Company (SCE&G) and the Indenture
underlying its First and Refunding Mortgage Bonds contain
provisions that, under certain circumstances, could limit the
payment of cash dividends on its common stock. In addition,
with respect to hydroelectric projects, the Federal Power Act
requires the appropriation of a portion of certain earnings
therefrom. At June 30, 1998 approximately $23.5 million of
retained earnings were restricted by this requirement as to
payment of cash dividends on SCE&G's common stock.
4. INVESTMENTS IN EQUITY SECURITIES:
SCANA Communications, Inc. (SCI) owns approximately 4.5
million common shares, representing approximately 17% of the
total common shares of Powertel, Inc. (Powertel), a publicly
traded telecommunications company which owns and operates
personal communications services (PCS) systems in several major
markets in the Southeast and an affiliate of ITC Holding
Company, Inc. (ITC). The cost of this investment is
approximately $66.7 million. Common shares were initially
recorded at $14.85 per share, and closed at $18 1/2 on June
30, 1998, resulting in a pre-tax holding gain of $16.4
million. The after-tax amount of such gain is included in the
balance sheet as a component of "Common Equity." In addition,
SCI owns 100,000 non-voting series B, 50,000 non-voting
series D, and 50,000 non-voting series E 6.5% convertible
preferred shares of Powertel. The costs of such investments
are approximately $75.1 million, $22.5 million and $75
million, respectively. Preferred series B shares are
8
convertible in March 2002 at a conversion price of $16.50
per common share or approximately $4.5 million common
shares. Preferred series D shares are convertible in March
2002 at a conversion price of $12.75 per common share or
approximately 1.7 million common shares. Preferred series E
shares are convertible in June 2003 at a conversion price of
$22.01 per common share or approximately 3.4 million common
shares. The market value of the convertible preferred shares
of Powertel is not readily determinable. However, on an as
converted basis, the market value of the underlying common
shares for the preferred shares was approximately $179.8
million at June 30, 1998, resulting in an unrecorded pre-
tax holding gain of $7.2 million.
SCI owns 3,555,838 common shares (after giving effect to
the two-for-one stock split announced July 29, 1998) of ITC
Delta^Com, Inc. (ITCD), a Georgia-based telecommunications
company and an affiliate of ITC. The cost of this investment
is approximately $9.0 million. ITCD common stock closed
at $42.73 per share on June 30, 1998, resulting in a pre-
tax unrealized holding gain of $67.0 million. The after-
tax amount of such gain is included in the balance sheet as a
component of "Common Equity." In addition, SCI owns 1,480,771
shares of series A preferred stock of ITCD at a cost of
approximately $11.2 million. Series A preferred shares are
convertible in March 2002 into 2,961,542 shares of ITCD common
stock (after giving effect to the two-for-one stock split).
The market value of series A preferred stock of ITCD is not
readily determinable. However, on an as converted basis the
market value of the underlying common stock for the series A
preferred stock was approximately $63.3 million at June 30,
1998, resulting in an unrecorded pre-tax holding gain of $52.1
million.
At June 30, 1998 SCI owned 71,050 units of Knology Holdings,
Inc. (Knology), an affiliate of ITC. Each unit consists of one
11.875% Senior Discount Note due 2007 and one Warrant entitling
the holder to purchase .003734 shares of preferred stock of
Knology. The cost of this investment was approximately $40
million. In addition, SCI invested $5.3 million to purchase
3,639 shares of preferred stock of Knology and Knology agreed
to issue to SCI warrants to purchase 753 shares of preferred
stock at $1,500 per share. Effective July 31, 1998 SCI sold
its preferred stock in Knology to ITC. The sales price of each
share was $1,600 payable in shares of ITC series B convertible
preferred stock and $100 in cash.
At June 30, 1998 SCI owned 774,616 common shares and 645,153
series A convertible preferred shares of ITC. The costs of
these investments are approximately $7.1 million and $8.9
million, respectively. The market value of these investments
is not readily determinable. Effective July 31, 1998, as a
result of the sale of its investment in Knology preferred
stock, SCI received 133,664 series B convertible preferred
shares of ITC.
5. CONTINGENCIES:
With respect to commitments at June 30, 1998, reference is made
to Note 10 to Consolidated Financial Statements appearing in
the Company's Annual Report on Form 10-K for the year
ended December 31, 1997. Contingencies at June 30, 1998 are
as follows:
A. Nuclear Insurance
The Price-Anderson Indemnification Act, which deals with public
liability for a nuclear incident, currently establishes the
liability limit for third-party claims associated with any
nuclear incident at $9.9 billion. Each reactor licensee is
currently liable for up to $88.1 million per reactor owned for
each nuclear incident occurring at any reactor in the United
States, provided that not more than $10 million of the
liability per reactor would be assessed per year. SCE&G's
maximum assessment, based on its two-thirds ownership of V.
C. Summer Nuclear Station (Summer Station), would be
approximately $58.7 million per incident, but not more than
$6.7 million per year.
9
SCE&G currently maintains policies (for itself and on behalf
of the PSA) with Nuclear Electric Insurance Limited (NEIL) and
American Nuclear Insurers (ANI) providing combined property and
decontamination insurance coverage of $2.0 billion for any
losses at Summer Station. SCE&G pays annual premiums and, in
addition, could be assessed a retroactive premium not to exceed
five times its annual premium in the event of property damage
loss to any nuclear generating facility covered under the NEIL
program. Based on the current annual premium, this retroactive
premium assessment would not exceed $6.1 million.
To the extent that insurable claims for property damage,
decontamination, repair and replacement and other costs and
expenses arising from a nuclear incident at Summer Station
exceed the policy limits of insurance, or to the extent such
insurance becomes unavailable in the future, and to the extent
that SCE&G's rates would not recover the cost of any purchased
replacement power, SCE&G will retain the risk of loss as a
self-insurer. SCE&G has no reason to anticipate a serious
nuclear incident at Summer Station. If such an incident were
to occur, it could have a material adverse impact on the
Company's results of operations, cash flows and financial
position.
B. Environmental
The Company has an environmental assessment program to identify
and assess current and former operations sites that could
require environmental cleanup. As site assessments are
initiated an estimate is made of the amount of expenditures,
if any, necessary to investigate and clean up each site. These
estimates are refined as additional information becomes
available; therefore, actual expenditures could differ
significantly from the original estimates. Amounts estimated
and accrued to date for site assessment and cleanup relate
primarily to regulated operations; such amounts are deferred
(approximately $28 million) and are being amortized and
recovered through rates over a five-year period for electric
operations and an eight-year period for gas operations. The
deferral includes the costs estimated to be associated with the
matters discussed below.
In September 1992, the Environmental Protection Agency
(EPA) notified SCE&G, the City of Charleston and the
Charleston Housing Authority of their potential liability
for the investigation and cleanup of the Calhoun Park area
site in Charleston, South Carolina. This site encompasses
approximately 30 acres and includes properties which were
locations for industrial operations, including a wood
preserving (creosote) plant, one of SCE&G's decommissioned
manufactured gas plants, properties owned by the National
Park Service and the City of Charleston and private
properties. The site has not been placed on the
National Priorities List, but may be added before
cleanup is initiated. The Potentially Responsible
Parties (PRPs) have agreed with the EPA to
participate in an innovative approach to site
investigation and cleanup called "Superfund Accelerated
Cleanup Model," allowing the pre-cleanup site
investigation process to be compressed significantly. The
PRPs have negotiated an administrative order by consent
for the conduct of a Remedial Investigation/Feasibility
Study and a corresponding Scope of Work. Field work began
in November 1993, and the EPA approved a Remedial
Investigation Report in February 1997 and a Feasibility
Study Report in June 1998. A Record of Decision, which
outlines the EPA and PRP's agreement as to the extent each
PRP is responsible for site contamination and the level
to which the site must be remediated, has not been issued.
However, in July 1998, the EPA approved SCE&G's Removal
Action Work Plan for soil excavation. Accordingly, SCE&G
is scheduled to begin soil excavation in August 1998. In
addition, SCE&G is continuing to investigate cost-
effective clean up methodologies.
10
In October 1996 the City of Charleston and SCE&G settled
all environmental claims the City may have had against
SCE&G involving the Calhoun Park area for a payment
of $26 million over four years (1996-1999) by SCE&G to
the City. SCE&G is recovering the amount of the
settlement, which does not encompass site assessment and
cleanup costs, through rates in the same manner as other
amounts accrued for site assessments and cleanup as
discussed above. As part of the environmental settlement,
SCE&G has agreed to construct an 1,100 space parking
garage on the Calhoun Park site and to transfer the
facility to the City in exchange for a 20-year municipal
bond backed by revenues from the parking garage and a
mortgage on the parking garage. Construction is expected
to begin in 1998. The total amount of the bond is not to
exceed $16.9 million, the maximum expected project cost.
SCE&G owns three other decommissioned manufactured gas
plant sites which contain residues of by-product
chemicals. SCE&G is investigating the sites to monitor
the nature and extent of the residual contamination.
C. SCANA Communications, Inc. Matters
SCI, as a result of an internal audit, informed the Federal
Communications Commission (FCC) that it violated certain
licensing requirements in establishing and operating an 800 Mhz
radio system in South Carolina for public safety and utility
use. As a result, SCI has returned to the FCC several licenses
obtained in violation of FCC rules and the FCC is conducting
an investigation of the system. The Company does not believe
that the resolution of this issue will have a material impact
on results of operations, cash flows or financial position.
11
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations.
SCANA CORPORATION
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
General
The following discussion should be read in conjunction with
Management's Discussion and Analysis of Financial Condition and
Results of Operations appearing in SCANA Corporation's (the
Company) Annual Report on Form 10-K for the year ended December 31,
1997.
Statements included in this discussion and analysis (or
elsewhere in this quarterly report) which are not statements of
historical fact are intended to be, and are hereby identified as,
"forward-looking statements" for purposes of the safe harbor
provided by Section 27A of the Securities Act of 1933, as amended,
and Section 21E of the Securities Exchange Act of 1934, as amended.
Readers are cautioned that any such forward-looking statements are
not guarantees of future performance and involve a number of risks
and uncertainties, and that actual results could differ materially
from those indicated by such forward-looking statements. Important
factors that could cause actual results to differ materially from
those indicated by such forward-looking statements include, but are
not limited to, the following: (1) that the information is of a
preliminary nature and may be subject to further and/or continuing
review and adjustment, (2) changes in the utility regulatory
environment, (3) changes in the economy in areas served by the
Company's subsidiaries, (4) the impact of competition from
other energy suppliers, (5) the management of the Company's
operations, (6) growth opportunities for the Company's regulated
and diversified subsidiaries, (7) the results of financing efforts,
(8) changes in the Company's accounting policies, (9) weather
conditions in areas served by the Company's utility subsidiaries,
(10) performance of the telecommunications companies in which the
Company has made significant investments, (11) inflation, (12)
changes in environmental regulations and (13) the other risks and
uncertainties described from time to time in the Company's periodic
reports filed with the Securities and Exchange Commission. The
Company disclaims any obligation to update any forward-looking
statements.
Material Changes in Capital Resources and Liquidity
Since December 31, 1997
Liquidity and Capital Resources
On January 9, 1996 the PSC issued an order which, among other
things, authorized SCE&G to earn a return on common equity of
12.0%. The PSC also approved establishment of a Storm Damage
Reserve Account capped at $50 million to be collected through
rates over a ten-year period. Additionally, SCE&G's request to
shift, for ratemaking purposes, approximately $257 million of
depreciation reserves from transmission and distribution assets to
nuclear production assets was approved. The Consumer Advocate and
two other intervenors appealed certain issues in the order to the
South Carolina Circuit Court, which affirmed the PSC's decisions,
and, subsequently, to the South Carolina Supreme Court. In March
1998, SCE&G, the PSC and the Consumer Advocate and one of the other
intervenors reached an agreement that provided for the reversal of
the shift in depreciation reserves and the dismissal of the appeal
of all other issues. The PSC also authorized the Company to adjust
depreciation rates that had been approved in the 1996 rate order
for its electric transmission, distribution and nuclear production
properties to eliminate the effect of the depreciation reserve
shift and to retroactively apply such depreciation rates to
February 1996. As a result, a one-time reduction in depreciation
expense of $5.5 million after taxes was recorded in March 1998.
The agreement does not affect retail electric rates. See "Results
of Operations - Earnings and Dividends." The remaining intervenor
continues to contest establishment of the Storm Damage Reserve
Account and the authorized return on common equity. The Supreme
Court heard the case in April 1998 and is expected to issue a
ruling during 1998. While the outcome of this proceeding is
uncertain, the Company does not believe that any significant
adverse change in the rate order is likely. The FERC had
previously rejected the transfer of depreciation reserves for rates
subject to its jurisdiction.
12
The following table summarizes how the Company generated funds
for its property acquisitions and utility property additions and
construction expenditures during the six months ended June 30, 1998
and 1997:
Six Months Ended
June 30,
1998 1997
(Millions of Dollars)
Net cash provided from operating activities $162 $177
Net cash provided (used) for financing
activities 7 (43)
Cash provided from sale of subsidiary assets - 8
Cash and temporary cash investments available
at the beginning of the period 60 17
Net cash available for property acquisitions
and utility property additions and
construction expenditures $229 $159
Funds used for utility property additions
and construction expenditures, net of
noncash allowance for funds used during
construction $108 $ 98
Funds used for nonutility property
additions and investments $ 82 $ 41
On January 10, 1997 SCANA closed on unsecured bank loans
totaling $60 million due January 9, 1998, and used the proceeds to
pay off a loan in a like total amount. On January 13, 1998 SCANA
refinanced the loans with $60 million of medium-term notes due
January 13, 2003 at an interest rate of 6.05%.
On July 8, 1998 SCANA issued $75 million of medium-term notes
having an annual interest rate of 6.25% and maturing on July 8,
2003. These funds were used to finance an additional investment of
$75 million in Powertel.
The Environmental Protection Agency has proposed new
regulations relating to nitrogen oxide emissions which, if enacted
in their present form, could have a material adverse effect on the
results of operations, cash flows and financial position of the
Company.
The Company and Westvaco Corporation have formed a limited
liability company, Cogen South LLC, to build and operate a $170
million cogeneration facility at Westvaco's Kraft Division Paper
Mill in North Charleston, South Carolina. The Company and Westvaco
each own a 50% interest in the LLC. The facility will provide
industrial process steam for the Westvaco paper mill and shaft
horsepower to enable SCE&G to generate up to 99 megawatts of
electricity. Construction financing is being provided to Cogen
South LLC by banks. A $15 million capital contribution to the LLC
by each partner is expected prior to operation of the facility.
Construction of the plant began in September 1996 and it is
expected to be operational in the fall of 1998. In addition to the
cogeneration LLC, Westvaco has entered into a 20-year contract with
SCE&G for all its electricity requirements at the North Charleston
mill at SCE&G's standard industrial rate.
On June 23, 1998 SCI purchased for $75 million 50,000 shares
of non-voting 6.5% series E convertible preferred stock of
Powertel. In addition, SCI owns approximately 4.5 million common
shares, representing approximately 17% of the total Powertel common
shares and 100,000 non-voting series B and 50,000 non-voting
series D convertible preferred shares of Powertel. The costs of
such investments are approximately $66.7 million, $75.1 million
and $22.5 million, respectively.
13
SCI owns 3,555,838 shares (after giving effect to the two-
for-one stock split announced July 29, 1998), representing
approximately 6.9%, of ITCD common stock, and 1,480,771 shares of
series A preferred stock of ITCD convertible in March 2002 into
2,691,542 shares of ITCD common stock (after giving effect to the
two-for-one stock split). The costs of such investments are
approximately $9.0 million and $11.2 million, respectively.
At June 30, 1998 SCI owned 71,050 units of Knology. Each
unit consists of one 11.875% Senior Discount Note due 2007 and
one Warrant entitling the holder to purchase .003734 shares of
preferred stock of Knology. The cost of this investment was
approximately $40 million. In addition, SCI invested $5.3
million to purchase 3,639 shares of preferred stock of Knology
and Knology agreed to issue to SCI warrants to purchase 753 shares
of preferred stock at $1,500 per share. Effective July 31, 1998
SCI sold its preferred stock in Knology to ITC. The sales price of
each share was $1,600 payable in shares of ITC series B
convertible preferred stock and $100 in cash.
At June 30, 1998 SCI owned 774,616 shares, representing
approximately 9.3% of ITC common stock and 645,153 series A
convertible preferred shares of ITC. The costs of these
investments are approximately $7.1 million and $8.9 million,
respectively. In addition, as a result of the sale of its
investment in Knology preferred stock, SCI received 133,664 series
B convertible preferred shares of ITC effective July 31, 1998.
The Company anticipates that the remainder of its 1998 cash
requirements will be met through internally generated funds, the
sales of medium-term notes and the incurrence of additional short-
term and long-term indebtedness. The timing and amount of such
financings will depend upon market conditions and other factors.
The Company expects that it has or can obtain adequate sources of
financing to meet its projected cash requirements for the next
twelve months and for the foreseeable future. The ratio of
earnings to fixed charges for the twelve months ended June 30, 1998
was 3.93.
The year 2000 issue could have a material impact on the
operations of the Company if required modifications and conversions
are not made to ensure that all critical system software and
equipment with embedded processors are date code compliant. The
Company has formed a steering committee to direct the resolution of
this major issue. The steering committee, which reports to the
senior officers of the Company and to the board of directors, is
chaired by the chief financial officer of the Company and is
comprised of officers representing all operational areas. A Year
2000 Project Office, made up of nine full time project managers
plus support personnel is responsible for addressing year 2000
issues and coordinating the required assessment and remediation
efforts. The Year 2000 Project Office reports directly to the
Steering Committee.
The Company has completed an initial inventory of impacted
information systems applications, operating software, hardware and
embedded processors. A risk prioritization of these systems was
completed to determine the Company's critical systems. The
assessment process to determine which systems have year 2000
compliance issues is well underway. Remediation efforts on
critical systems have begun and are expected to be completed by
mid-1999. The Company has identified and assigned key employees to
develop year 2000 contingency plans. The cost of the project is
not expected to have a material impact on the results of
operations, cash flows and financial position of the Company.
In particular, with regard to the evaluation and remediation
of the year 2000 issue at V. C. Summer Nuclear Station, the Company
is cooperating closely with other utilities, including utilities in
the southeast, that own nuclear power plants. The utilities are
sharing technical nuclear plant operating and monitoring systems
information to ensure the prompt and effective resolution of year
2000 issues.
The Company is communicating with all of its significant
suppliers to determine the extent to which the Company is
vulnerable to those suppliers' failure to remediate their own year
2000 issues. The extent to which significant customers have
resolved the year 2000 issues, and the resulting impact on the
demand for the Company's products, is not determinable. There can
be no guarantee that the systems of other companies on which the
Company's systems rely will be timely converted. A failure to
convert by another company, or a conversion that is incompatible
with the Company's systems, could have a material adverse effect on
the results of operations, cash flows and financial position of the
Company.
14
SCANA CORPORATION
Results of Operations
For the Three and Six Months ended June 30, 1998
As Compared to the Corresponding Periods in 1997
Earnings and Dividends
Net income for the three and six months ended June 30, 1998
increased approximately $12.8 million and $19.4 million,
respectively, when compared to the corresponding periods in 1997.
Higher electric margins were partially offset by increased
operating and maintenance expenses and lower earnings from non-
regulated businesses. Net income for the six months ended June 30,
1998 includes a one-time, after-tax adjustment to depreciation
expense of approximately $5.5 million related to a change in
depreciation rates retroactive to February 1996. This change in
rates results from the reversal of a $257 million shift of
depreciation reserves from electric transmission and distribution
assets to nuclear production assets, previously approved in a PSC
rate order in January 1996. See "Liquidity and Capital Resources."
Allowance for funds used during construction (AFC) is a
utility accounting practice whereby a portion of the cost of both
equity and borrowed funds used to finance construction (which is
shown on the balance sheet as construction work in progress) is
capitalized. Both the equity and the debt portions of AFC are
noncash items of nonoperating income which have the effect of
increasing reported net income. AFC represented approximately 5%
of income before income taxes for the six months ended June 30,
1998 and 1997, respectively.
On February 17, 1998 the Company's Board of Directors
declared a quarterly dividend on common stock of 38 1/2 cents per
share, for the quarter ended March 31, 1998. The dividend was paid
on April 1, 1998 to common stockholders of record on March 10,
1998.
On April 23, 1998 the Company's Board of Directors declared a
quarterly dividend on common stock of 38 1/2 cents per share for
the quarter ended June 30, 1998. The dividend was paid on July 1,
1998 to common stockholders of record on June 10, 1998.
Sales Margins
Changes in the electric sales margin for the three and six
months ended June 30, 1998, when compared to the corresponding
periods in 1997, were as follows:
Three Months Six Months
Change % Change Change % Change
(Millions) (Millions)
Electric operating revenues $51.8 21.0 $68.6 13.7
Less: Fuel used in electric
generation 13.4 24.3 18.3 16.8
Purchased power 7.8 202.6 8.8 194.0
Margin $30.6 16.2 $41.5 10.7
The electric sales margin increased for the three and six
months ended June 30, 1998 when compared to the corresponding
periods of 1997 primarily as a result of more favorable weather and
customer growth.
15
Changes in the gas sales margin for the three and six months
ended June 30, 1998, when compared to the corresponding periods in
1997, were as follows:
Three Months Six Months
Change % Change Change % Change
(Millions) (Millions)
Gas operating revenues $ 3.5 4.1 $8.2 3.8
Less: Gas purchased for resale 6.3 11.3 6.5 4.7
Margin $(2.8) (9.7) $1.7 2.1
The gas sales margin decreased for the three months ended June
30, 1998, when compared to the corresponding period in 1997
primarily due to increased competitiveness of alternative fuels.
The year to date margin reflects an increase when compared to the
same period in 1997 primarily as a result of colder weather and
increased sales to industrial interruptible customers attributable
to fewer curtailments in the first quarter.
Other Operating Expenses
Changes in other operating expenses, including taxes, for the
three and six months ended June 30, 1998, when compared to the
corresponding periods in 1997, are presented in the following
table:
Three Months Six Months
Change % Change Change % Change
(Millions) (Millions)
Other operation and maintenance $ 5.0 6.6 $13.1 8.9
Depreciation and amortization 0.4 1.0 (8.0) (10.5)
Income taxes 7.0 36.9 12.7 25.5
Other taxes 2.4 10.5 2.5 5.2
Total $14.8 9.4 $20.3 6.3
Other operation and maintenance expenses for the three and six
months ended June 30, 1998 increased from 1997 levels primarily as
a result of increases in costs at electric generating plants and
various operating costs. The decrease in depreciation and
amortization expenses for the six months ended June 30, 1998
reflects the non-recurring adjustment to depreciation expense
discussed under "Earnings and Dividends." The changes in income
tax expense primarily reflect changes in operating income. The
increase in other taxes for the periods primarily results from
increases in property taxes.
Other Income
Other income, net of income taxes, for the three and six
months ended June 30, 1998 decreased approximately $1.2 million
and $4.6 million, respectively when compared to the corresponding
periods of 1997. These decreases are primarily attributable to
losses from energy marketing activities as a result of decreased
gas margins, volatility in power markets related to unusually hot
weather and startup costs in new markets. Additionally, SCANA
Petroleum Resources, Inc., which had contributed approximately $3.4
million to first quarter 1997 earnings, sold substantially all of
its assets in the fourth quarter of 1997.
16
Item 3. Quantitative and Qualitative Disclosure About Market
Risk
With regard to the market risk information disclosed in the
Company's Annual Report on Form 10-K at December 31, 1997 there
have been no material changes in market risk exposure related
to interest rate risk.
With regard to equity price risk, investments in
telecommunications companies' equity securities are carried at
$364.3 million at June 30, 1998, in accordance with Statement
of Financial Accounting Standards No. 115. A ten percent
decline in market value would result in a $36.4 million
reduction in fair value and a corresponding adjustment, net of
tax effect, to the related equity account for unrealized gains.
PART II
OTHER INFORMATION
Item 1. Legal Proceedings
For information regarding legal proceedings see Note 2
"Rate Matters," appearing in the Company's Annual Report
on Form 10-K for the year ended December 31, 1997, and
Note 5 "Contingencies" of Notes to Consolidated Financial
Statements appearing in this Quarterly Report on Form 10-
Q.
Items 2, 3 and 5 are not applicable.
Item 4. Submission of Matters to a Vote of Security-Holders
The Annual Meeting of Shareholders of SCANA Common Stock
(No Par Value) was held on April 23, 1998. The
following matters were voted upon at the meeting.
1 and 2. To elect seven (7) directors for the terms
specified in the Proxy Statement.
Number of Number of Shares Total
Shares Voting Voting to Shares
Nominee For Withhold Authority Voted
James A. Bennett 94,578,561 1,836,102 96,414,663
Maceo K. Sloan 94,593,209 1,821,454 96,414,663
William B. Bookhart, Jr. 95,079,956 1,334,707 96,414,663
Elaine T. Freeman 95,017,421 1,397,242 96,414,663
W. Hayne Hipp 95,065,751 1,348,912 96,414,663
F. Creighton McMaster 95,039,000 1,375,663 96,414,663
John B. Rhodes 95,025,761 1,388,902 96,414,663
3. To approve the appointment of Deloitte & Touche LLP
as independent accountants for the Corporation.
Number
of
Shares
FOR 95,793,042
AGAINST 316,567
ABSTAIN 305,054
TOTAL 96,414,663
Percent of FOR votes of those shares actually voting for this
proposal: 99.4%
17
4. To approve change in SCANA PERFORMANCE SHARE PLAN.
Number
of
Shares
FOR 91,596,037
AGAINST 3,437,705
ABSTAIN 1,380,921
TOTAL 96,414,663
Percent of FOR votes of those shares actually voting for this
proposal: 95.2%
Item 6. Exhibits and Reports on Form 8-K
A. Exhibits
Exhibits filed with this Quarterly Report on Form 10-Q are
listed in the following Exhibit Index. Certain of such
exhibits which have heretofore been filed with the
Securities and Exchange Commission and which are
designated by reference to their exhibit numbers in prior
filings are hereby incorporated herein by reference and
made a part hereof.
B. Reports on Form 8-K
None
18
SCANA CORPORATION
SIGNATURES
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.
SCANA CORPORATION
(Registrant)
August 13, 1998 By: s/K. B. Marsh
K. B. Marsh, Senior Vice President,
Chief Financial Officer and
Controller
(Principal financial officer)
19
SCANA CORPORATION
EXHIBIT INDEX Sequentially
Numbered
Pages
Number
2. Plan of Acquisition, Reorganization, Arrangement,
Liquidation or Succession
Not Applicable
3. Articles of Incorporation and By-Laws
A. Restated Articles of Incorporation of SCANA
Corporation as adopted on April 26, 1989
(Exhibit 3-A to Registration Statement
No. 33-49145)........................................... #
B. Articles of Amendment dated April 27, 1995
(Exhibit 4-B to Registration Statement No.
33-62421)............................................... #
C. Copy of By-Laws of SCANA Corporation as revised
and amended on December 17, 1997 (Exhibit 3-C to
Form 10-K for the year ended December 31, 1997)......... #
4. Instruments Defining the Rights of Security Holders,
Including Indentures
A. Articles of Exchange of South Carolina
Electric & Gas Company and SCANA Corporation
(Exhibit 4-A to Post-Effective Amendment No. 1
to Registration Statement No. 2-90438).................. #
B. Indenture dated as of November 1, 1989 to
The Bank of New York, Trustee (Exhibit 4-A
to Registration No. 33-32107)........................... #
C. Indenture dated as of January 1, 1945, from
the South Carolina Power Company (the "Power
Company") to Central Hanover Bank and Trust
Company, as Trustee, as supplemented by three
Supplemental Indentures dated respectively as
of May 1, 1946, May 1, 1947 and July 1, 1949
(Exhibit 2-B to Registration No. 2-26459)............... #
D. Fourth Supplemental Indenture dated as of
April 1, 1950, to Indenture referred to in
Exhibit 4C, pursuant to which the Company
assumed said Indenture (Exhibit 2-C to
Registration No. 2-26459)............................... #
E. Fifth through Fifty-second Supplemental
Indentures referred to in Exhibit 4C dated
as of the dates indicated below and filed
as exhibits to the Registration Statements
and 1934 Act reports whose file numbers are
set forth below......................................... #
# Incorporated herein by reference as indicated.
20
SCANA CORPORATION
EXHIBIT INDEX
Number
December 1, 1950 Exhibit 2-D to Registration No. 2-26459
July 1, 1951 Exhibit 2-E to Registration No. 2-26459
June 1, 1953 Exhibit 2-F to Registration No. 2-26459
June 1, 1955 Exhibit 2-G to Registration No. 2-26459
November 1, 1957 Exhibit 2-H to Registration No. 2-26459
September 1, 1958 Exhibit 2-I to Registration No. 2-26459
September 1, 1960 Exhibit 2-J to Registration No. 2-26459
June 1, 1961 Exhibit 2-K to Registration No. 2-26459
December 1, 1965 Exhibit 2-L to Registration No. 2-26459
June 1, 1966 Exhibit 2-M to Registration No. 2-26459
June 1, 1967 Exhibit 2-N to Registration No. 2-29693
September 1, 1968 Exhibit 4-O to Registration No. 2-31569
June 1, 1969 Exhibit 4-C to Registration No. 33-38580
December 1, 1969 Exhibit 4-Q to Registration No. 2-35388
June 1, 1970 Exhibit 4-R to Registration No. 2-37363
March 1, 1971 Exhibit 2-B-17 to Registration No. 2-40324
January 1, 1972 Exhibit 4-C to Registration No. 33-38580
July 1, 1974 Exhibit 2-A-19 to Registration No. 2-51291
May 1, 1975 Exhibit 4-C to Registration No. 33-38580
July 1, 1975 Exhibit 2-B-21 to Registration No. 2-53908
February 1, 1976 Exhibit 2-B-22 to Registration No. 2-55304
December 1, 1976 Exhibit 2-B-23 to Registration No. 2-57936
March 1, 1977 Exhibit 2-B-24 to Registration No. 2-58662
May 1, 1977 Exhibit 4-C to Registration No. 33-38580
February 1, 1978 Exhibit 4-C to Registration No. 33-38580
June 1, 1978 Exhibit 2-A-3 to Registration No. 2-61653
April 1, 1979 Exhibit 4-C to Registration No. 33-38580
June 1, 1979 Exhibit 4-C to Registration No. 33-38580
April 1, 1980 Exhibit 4-C to Registration No. 33-38580
June 1, 1980 Exhibit 4-C to Registration No. 33-38580
December 1, 1980 Exhibit 4-C to Registration No. 33-38580
April 1, 1981 Exhibit 4-D to Registration No. 33-49421
June 1, 1981 Exhibit 4-D to Registration No. 2-73321
March 1, 1982 Exhibit 4-D to Registration No. 33-49421
April 15, 1982 Exhibit 4-D to Registration No. 33-49421
May 1, 1982 Exhibit 4-D to Registration No. 33-49421
December 1, 1984 Exhibit 4-D to Registration No. 33-49421
December 1, 1985 Exhibit 4-D to Registration No. 33-49421
June 1, 1986 Exhibit 4-D to Registration No. 33-49421
February 1, 1987 Exhibit 4-D to Registration No. 33-49421
September 1, 1987 Exhibit 4-D to Registration No. 33-49421
January 1, 1989 Exhibit 4-D to Registration No. 33-49421
January 1, 1991 Exhibit 4-D to Registration No. 33-49421
February 1, 1991 Exhibit 4-D to Registration No. 33-49421
July 15, 1991 Exhibit 4-D to Registration No. 33-49421
# Incorporated herein by reference as indicated.
21
SCANA CORPORATION
EXHIBIT INDEX
Sequentially
Numbered
Pages
Number
August 15, 1991 Exhibit 4-D to Registration No. 33-49421
April 1, 1993 Exhibit 4-E to Registration No. 33-49421
July 1, 1993 Exhibit 4-D to Registration No. 33-57955
F. Indenture dated as of April 1, 1993 from
South Carolina Electric & Gas Company to
NationsBank of Georgia, National Association
(Filed as Exhibit 4-F to Registration Statement
No. 33-49421)........................................... #
G. First Supplemental Indenture to Indenture
referred to in Exhibit 4-F dated as of June 1, 1993
(Filed as Exhibit 4-G to Registration Statement
No. 33-49421)........................................... #
H. Second Supplemental Indenture to Indenture
referred to in Exhibit 4-F dated as of June 15, 1993
(Filed as Exhibit 4-G to Registration Statement
No. 33-57955)........................................... #
I. Trust Agreement for SCE&G Trust I (Filed as
Exhibit 4-I to Form 10-K for the year ended
December 31, 1997)...................................... #
J. Certificate of Trust for SCE&G Trust I (Filed as
Exhibit 4-J to Form 10-K for the year ended
December 31, 1997)...................................... #
K. Junior Subordinated Indenture for SCE&G Trust I
(Filed as Exhibit 4-K to Form 10-K for the year
ended December 31, 1997)................................ #
L. Guarantee Agreement for SCE&G Trust I
(Filed as Exhibit 4-L to Form 10-K for the year
ended December 31, 1997)................................ #
M. Amended & Restated Trust Agreement for SCE&G
Trust I (Filed as Exhibit 4-M to Form 10-K for the year
ended December 31, 1997)................................ #
10. Material Contracts
Not Applicable
11. Statement Re Computation of Per Share Earnings
Not Applicable
15. Letter Re Unaudited Interim Financial Information
Not Applicable
18. Letter Re Change in Accounting Principles
Not Applicable
19. Report Furnished to Security Holders
Not Applicable
22. Published Report Regarding Matters Submitted to
Vote of Security Holders
Not Applicable
23. Consents of Experts and Counsel
Not Applicable
24. Power of Attorney
Not Applicable
27. Financial Data Schedule (Filed herewith)
99. Additional Exhibits
Not Applicable
# Incorporated herein by reference as indicated.
22