Indiana Energy, Inc. and Subsidiary Companies
Highlights December 31, December 31,
(Unaudited) 1998 1997 (2)
Basic and Diluted Earnings
Per Average Share (1) :
Three Months Ended -
Indiana Gas and IEI Services $0.44 $0.57
IEI Investments $0.04 $0.04
Total $0.48 $0.61
Twelve Months Ended -
Indiana Gas and IEI Services $1.00 $0.46
IEI Investments $0.20 $0.26
Total $1.20 $0.72
Dividends Paid (per common share,
12 months)(1) $0.91 $0.87
Annualized Dividend (1) $0.93 $0.89
Dividend Yield (at close) 3.8% 3.6%
Dividend Payout Ratio 75.8% 120.8%
Dividend to Book Value 9.0% 8.8%
Return on Average Shareholder Equity 11.8% 7.0%
Book Value Per Share (1) $10.34 $10.11
Market to Book Value 238% 244%
Common Stock Prices (IEI - NYSE) (1)
High (12 Month) $26.38 $25.69
Low (12 Month) $19.59 $17.16
Close $24.63 $24.70
Price/Earnings Ratio 20.5 34.3
Percent Internally Generated
Funds - Utility 59% 58%
Ratio of Earnings to Fixed Charges
- SEC Method 4.2 2.8
Credit Ratings:
Indiana Gas AA- / Aa2 AA- / Aa2
Indiana Energy A+ / Aa3 A+ / Aa3
(1) Adjusted to reflect the four-for-three stock split October 2, 1998.
(2) Reflects the recording of restructuring costs of $39.5 million ($24.5 million after-tax
or $.81 per common share) at Indiana Gas during the quarter ended September 30, 1997.
For 3 Months For 12 Months
SELECTED UTILITY Ended December 31 Ended December 31
OPERATING STATISTICS
(Unaudited) 1998 1997 1998 1997
WEATHER AS A PERCENT
OF NORMAL 83% 103% 79% 101%
MARGIN (Thousands):
Operating Revenues $124,947 $170,132 $420,459 $528,058
Cost of Gas 67,937 107,052 231,889 319,738
Margin $57,010 $63,080 $188,570 $208,320
GAS SOLD & TRANSPORTED (MDth):
Residential 13,506 16,199 38,809 48,092
Commercial 5,163 6,597 15,610 19,459
Contract 15,175 16,002 55,181 56,130
33,844 38,798 109,600 123,681
OPERATING REVENUES (Thousands):
Residential $84,970 $112,726 $271,656 $336,882
Commercial 28,471 41,359 94,261 121,195
Contract 10,319 15,020 48,540 64,044
Miscellaneous Revenue 1,187 1,027 6,002 5,937
$124,947 $170,132 $420,459 $528,058
AVERAGE CUSTOMERS:
Residential 449,542 439,611 444,614 434,185
Commercial 45,894 45,402 45,703 45,177
Contract 1,024 1,054 1,054 1,056
496,460 486,067 491,371 480,418
INDIANA ENERGY, INC.
AND SUBSIDIARY COMPANIES
CONSOLIDATED BALANCE SHEETS
ASSETS
(Thousands - Unaudited)
December 31 September 30
1998 1997 1998
CURRENT ASSETS:
Cash and cash equivalents $ 20 $ 20 $ 9,325
Accounts receivable, less reserves of $1,749,
$2,104 and $900 respectively 28,610 53,544 10,939
Accrued unbilled revenues 40,577 46,123 6,453
Liquefied petroleum gas - at average cost 892 878 883
Gas in underground storage - at last-in,
first-out cost 18,150 17,024 19,373
Prepayments and other 6,667 5,162 5,483
94,916 122,751 52,456
INVESTMENTS IN UNCONSOLIDATED AFFILIATES 33,336 27,717 32,186
UTILITY PLANT:
Original cost 946,602 922,491 937,977
Less - accumulated depreciation and amortization 376,133 358,750 370,872
570,469 563,741 567,105
NONUTILITY PLANT:
Original cost 58,456 45,803 55,225
Less - accumulated depreciation and amortization 14,219 9,004 12,613
44,237 36,799 42,612
DEFERRED CHARGES AND OTHER ASSETS:
Unamortized debt discount and expense 12,653 8,139 12,954
Regulatory income tax asset 1,778 - 1,778
Other 4,225 6,051 3,259
18,656 14,190 17,991
$761,614 $765,198 $712,350
INDIANA ENERGY, INC.
AND SUBSIDIARY COMPANIES
CONSOLIDATED BALANCE SHEETS
LIABILITIES AND SHAREHOLDERS' EQUITY
(Thousands except shares - Unaudited)
December 31 September 30
1998 1997 1998
CURRENT LIABILITIES:
Maturities and sinking fund requirements of long-term debt $ 10,174 $ 272 $ 10,119
Notes payable 56,475 72,800 33,705
Accounts payable 29,677 47,324 19,416
Refundable gas costs 14,343 10,333 10,730
Customer deposits and advance payments 22,416 19,738 19,229
Accrued taxes 10,127 19,127 4,728
Accrued interest 4,984 4,361 1,974
Other current liabilities 22,773 25,480 26,319
170,969 199,435 126,220
DEFERRED CREDITS AND OTHER LIABILITIES:
Deferred income taxes 60,580 55,736 60,448
Accrued postretirement benefits other than pensions 26,150 23,744 25,388
Unamortized investment tax credit 9,082 10,012 9,313
Regulatory income tax liability - 1,874 -
Other 2,157 2,035 2,061
97,969 93,401 97,210
COMMITMENTS AND CONTINGENCIES - - -
CAPITALIZATION:
Long-term debt 183,386 167,859 183,489
Common stock (no par value) - authorized 200,000,000
shares - issued and outstanding 29,919,672,
30,121,850 and 30,063,667 shares, respectively (1) 142,295 146,791 145,586
Less unearned compensation - restricted stock grants 1,377 1,708 1,207
140,918 145,083 144,379
Retained earnings 168,372 159,420 161,052
Total common shareholders' equity 309,290 304,503 305,431
492,676 472,362 488,920
$761,614 $765,198 $712,350
(1) Adjusted to reflect the four-for-three stock split October 2, 1998.
INDIANA ENERGY, INC.
AND SUBSIDIARY COMPANIES
CONSOLIDATED STATEMENTS OF INCOME
(Thousands except per share data)
(Unaudited)
Three Months Twelve Months
Ended December 31 Ended December 31
1998 1997 1998 1997
OPERATING REVENUES:
Utility $ 124,947 $ 170,132 $ 420,459 $ 528,058
Other 294 203 888 356
125,241 170,335 421,347 528,414
OPERATING EXPENSES:
Cost of gas 67,937 107,052 230,372 319,357
Other operating 19,326 18,020 76,902 78,778
Restructuring costs - - - 39,531
Depreciation and amortization 9,915 8,906 38,664 35,417
Taxes other than income taxes 4,251 4,913 14,072 17,200
101,429 138,891 360,010 490,283
OPERATING INCOME 23,812 31,444 61,337 38,131
OTHER INCOME:
Equity in earnings of unconsolidated
affiliates 1,425 1,963 6,688 9,187
Other - net 376 405 2,469 3,274
1,801 2,368 9,157 12,461
INCOME BEFORE INTEREST AND
INCOME TAXES 25,613 33,812 70,494 50,592
INTEREST EXPENSE 4,231 4,661 16,209 17,416
INCOME BEFORE INCOME TAXES 21,382 29,151 54,285 33,176
INCOME TAXES 7,106 10,795 18,161 11,602
NET INCOME $ 14,276 $ 18,356 $ 36,124 $ 21,574
AVERAGE COMMON SHARES OUTSTANDING (1) 29,970 30,121 30,078 30,111
BASIC AND DILUTED EARNINGS PER
AVERAGE SHARE OF COMMON STOCK (1) $ 0.48 $ 0.61 $ 1.20 $ 0.72
(1) Adjusted to reflect the four-for-three stock split October 2, 1998.
INDIANA ENERGY, INC.
AND SUBSIDIARY COMPANIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Thousands - Unaudited)
Three Months Twelve Months
Ended December 31 Ended December 31
1998 1997 1998 1997
CASH FLOWS FROM (REQUIRED FOR)
OPERATING ACTIVITIES:
Net income $ 14,276 $ 18,356 $ 36,124 $ 21,574
Adjustments to reconcile net income to cash
provided from operating activities -
Noncash restructuring costs - - - 32,838
Depreciation and amortization 9,962 8,953 38,851 35,604
Deferred income taxes 132 531 1,192 (12,645)
Investment tax credit (232) (232) (930) (930)
Gain on sale of assets - - (2,102) (2,923)
Undistributed earnings of unconsolidated
affiliates (1,425) (1,963) (6,688) (9,187)
8,437 7,289 30,323 42,757
Changes in assets and liabilities -
Receivables - net (51,795) (68,385) 30,480 (16,821)
Inventories 1,204 2,123 (1,191) 21,223
Accounts payable, customer deposits, advance
payments and other current liabilities 9,902 14,797 (17,676) (3,458)
Accrued taxes and interest 8,409 12,200 (8,377) 4,521
Recoverable/refundable gas costs 3,613 16,176 4,010 27,282
Prepayments (1,174) (1,309) (1,454) (3,988)
Accrued postretirement benefits other
than pensions 762 706 2,406 7,916
Other - net 1,180 (2,985) 203 (2,258)
Total adjustments (19,462) (19,388) 38,724 77,174
Net cash flows from (required for)
operations (5,186) (1,032) 74,848 98,748
CASH FLOWS FROM (REQUIRED FOR)
FINANCING ACTIVITIES:
Repurchase of common stock (3,645) - (4,834) -
Sale of long-term debt - 35,014 60,052 50,062
Reduction in long-term debt (48) (59,946) (34,623) (60,069)
Net change in short-term borrowings 22,770 49,000 (16,325) 6,000
Dividends on common stock (6,924) (6,625) (27,140) (26,023)
Net cash flows from (required for)
financing activities 12,153 17,443 (22,870) (30,030)
CASH FLOWS REQUIRED FOR INVESTING ACTIVITIES:
Capital expenditures (16,375) (16,339) (66,066) (70,533)
Nonutility investments in unconsolidated
affiliates - net (673) (100) (7,035) (1,350)
Cash distributions from unconsolidated
affiliates 776 - 7,806 -
Proceeds from sale of assets - - 13,317 3,000
Net cash flows required for investing
activities (16,272) (16,439) (51,978) (68,883)
NET INCREASE (DECREASE) IN CASH (9,305) (28) - (165)
CASH AND CASH EQUIVALENTS AT BEGINNING OF
PERIOD 9,325 48 20 185
CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 20 $ 20 $ 20 $ 20