1
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------------------
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTER ENDED MARCH 31, 1997
COMMISSION REGISTRANTS; STATE OF INCORPORATION; I.R.S. EMPLOYER
FILE NUMBER ADDRESS; AND TELEPHONE NUMBER IDENTIFICATION NO.
- ----------- ------------------------------------------ ------------------
1-11607 DTE Energy Company 38-3217752
(a Michigan corporation)
2000 2nd Avenue
Detroit, Michigan 48226-1279
313-235-4000
1-2198 The Detroit Edison Company 38-0478650
(a Michigan corporation)
2000 2nd Avenue
Detroit, Michigan 48226-1279
313-235-8000
Indicate by check mark whether the registrants (1) have 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
registrants were required to file such reports), and (2) have been subject to
such filing requirements for the past 90 days. YES X NO
--- ---
At March 31, 1997, 145,101,736 shares of DTE Energy's Common Stock,
substantially all held by non-affiliates, were outstanding.
================================================================================
2
DTE ENERGY COMPANY
AND
THE DETROIT EDISON COMPANY
FORM 10-Q
FOR THE QUARTER ENDED MARCH 31, 1997
This document contains the Quarterly Reports on Form 10-Q for the quarter ended
March 31, 1997 for each of DTE Energy Company and The Detroit Edison Company.
Information contained herein relating to an individual registrant is filed by
such registrant on its own behalf. Accordingly, except for its subsidiaries,
The Detroit Edison Company makes no representation as to information relating
to any other companies affiliated with DTE Energy Company.
TABLE OF CONTENTS
Page
Definitions ............................................................ 3
Quarterly Report on Form 10-Q for DTE Energy Company:
Part I-Financial Information................................. 4
Item 1 -Financial Statements (Unaudited)............. 4
Notes to Consolidated Financial
Statements (Unaudited)....................... 14
Independent Accountants' Report.............. 16
Item 2 -Management's Discussion and
Analysis of Financial Condition and Results
of Operations ............................... 17
Part II-Other Information ................................... 26
Item 1 -Legal Proceedings ......................... 26
Item 5 -Other Information .......................... 26
Quarterly Report on Form 10-Q for The Detroit Edison Company:
Part I-Financial Information ................................ 27
Item 1 -Financial Statements (Unaudited)............. 27
Item 2 -Management's Discussion and Analysis of Financial
Condition and Results of Operations.......... 27
Part II-Other Information.................................... 27
Item 1 -Legal Proceedings............................ 27
Item 5 -Other Information............................ 27
Quarterly Reports on Form 10-Q for DTE Energy Company and The Detroit
Edison Company:
Item 6 -Exhibits and Reports on Form 8-K............. 28
Signature Page to DTE Energy Company Quarterly Report on Form 10-Q...... 35
Signature Page to The Detroit Edison Company Quarterly
Report on Form 10-Q..................................................... 36
2
3
DEFINITIONS
Annual Report ........ 1996 Annual Report to the Securities and Exchange
Commission on Form 10-K for DTE Energy Company or The
Detroit Edison Company, as the case may be
Annual Report Notes .. Notes to Consolidated Financial Statements appearing on
pages 49 through 59 of the 1996 Annual Report to the
Securities and Exchange Commission on Form 10-K for DTE
Energy Company and The Detroit Edison Company
Company .............. DTE Energy Company and Subsidiary Companies
Detroit Edison ....... The Detroit Edison Company (a wholly owned subsidiary
of DTE Energy Company) and Subsidiary Companies
EPA .................. United States Environmental Protection Agency
FERC ................. Federal Energy Regulatory Commission
kWh .................. Kilowatthour
Mortgage Bonds ....... Detroit Edison's General and Refunding Mortgage Bonds
MPSC ................. Michigan Public Service Commission
MW ................... Megawatts
Note(s) .............. Note(s) to Consolidated Financial Statements
(Unaudited) appearing herein
PSCR ................. Power Supply Cost Recovery
QUIDS ................ Quarterly Income Debt Securities
Registrant ........... Company or Detroit Edison, as the case may be
3
4
QUARTERLY REPORT ON FORM 10-Q FOR DTE ENERGY COMPANY
PART I - FINANCIAL INFORMATION
ITEM 1 - FINANCIAL STATEMENTS (UNAUDITED):
DTE ENERGY COMPANY AND SUBSIDIARY COMPANIES
CONSOLIDATED STATEMENT OF INCOME (UNAUDITED)
(Dollars in Thousands)
Three Months Ended Twelve Months Ended
March 31 March 31
----------------------------------------------------
1997 1996 1997 1996
----------------------------------------------------
OPERATING REVENUES
Electric - System $841,976 $887,627 $3,525,682 $ 3,585,049
Electric - Interconnection 10,936 11,244 44,816 54,884
Steam and other 15,692 10,708 33,927 24,916
-------------------------------------------------------------------------------------------------------
Total Operating Revenues $868,604 $909,579 $3,604,425 $ 3,664,849
- --------------------------------------------------------------------------------------------------------
OPERATING EXPENSES
Operation
Fuel $152,462 $175,667 $ 672,333 $ 721,974
Purchased power 46,035 23,496 172,772 121,941
Other operation 163,147 151,022 664,364 648,946
Maintenance 69,632 73,611 273,806 261,255
Steam heating special charges - - 149,231 42,029
Depreciation and amortization 138,414 132,011 533,028 507,578
Deferred Fermi 2 amortization (747) (1,120) (4,106) (5,599)
Amortization of deferred Fermi 2 depreciation
and return 27,973 25,483 104,571 95,226
Taxes other than income 68,854 66,761 261,730 256,057
Income taxes 54,391 76,104 200,893 283,740
- --------------------------------------------------------------------------------------------------------
Total Operating Expenses $720,161 $723,035 $3,028,622 $ 2,933,147
- --------------------------------------------------------------------------------------------------------
OPERATING INCOME $148,443 $186,544 $ 575,803 $ 731,702
- --------------------------------------------------------------------------------------------------------
OTHER INCOME AND (DEDUCTIONS)
Allowance for other funds used
during construction $ 223 $ 388 $ 2,165 $ 1,481
Other income and (deductions) - net (4,782) (956) (16,311) (17,867)
Income taxes 1,607 303 5,234 5,094
Accretion income 1,591 2,327 7,489 10,354
Accretion expense (2,382) - (2,382) -
Income taxes 307 (686) (1,370) (3,112)
- --------------------------------------------------------------------------------------------------------
Net Other Income and (Deductions) $ (3,436) $ 1,376 $ (5,175) $ (4,050)
- --------------------------------------------------------------------------------------------------------
INTEREST CHARGES
Long-term debt $ 67,566 $ 68,360 $ 274,367 $ 275,535
Amortization of debt discount and expense 2,986 2,955 11,914 11,468
Other 839 1,574 3,483 7,339
Allowance for borrowed funds used during
construction (credit) (291) (702) (2,621) (2,584)
- --------------------------------------------------------------------------------------------------------
Net Interest Charges $ 71,100 $ 72,187 $ 287,143 $ 291,758
- --------------------------------------------------------------------------------------------------------
PREFERRED STOCK DIVIDENDS OF SUBSIDIARY 2,907 7,293 11,629 27,623
- --------------------------------------------------------------------------------------------------------
NET INCOME $ 71,000 $108,440 $ 271,856 $ 408,271
========================================================================================================
COMMON SHARES OUTSTANDING - AVERAGE 145,108,547 145,119,875 145,117,082 144,613,380
EARNINGS PER COMMON SHARE $ 0.49 $ 0.75 $ 1.87 $ 2.82
DIVIDENDS DECLARED PER SHARE OF COMMON STOCK $ 0.515 $ 0.515 $ 2.06 $ 2.06
See accompanying Notes to Consolidated Financial Statements (Unaudited).
4
5
DTE ENERGY COMPANY AND SUBSIDIARY COMPANIES
CONSOLIDATED STATEMENT OF CASH FLOWS (UNAUDITED)
(Dollars in Thousands)
Three Months Ended Twelve Months Ended
March 31 March 31
-----------------------------------------------
1997 1996 1997 1996
-----------------------------------------------
OPERATING ACTIVITIES
Net Income $ 71,000 $ 108,440 $ 271,856 $ 408,271
Adjustments to reconcile net income to net cash
from operating activities:
Accretion income (1,591) (2,327) (7,489) (10,354)
Accretion expense 2,382 - 2,382 -
Depreciation and amortization 138,414 132,011 533,028 507,578
Deferred Fermi 2 amortization and return - net 27,226 24,363 100,465 89,627
Deferred income taxes and investment tax credit - net (13,963) 17,063 (29,131) 53,310
Fermi 2 refueling outage - net 3,527 3,258 (12,724) 12,533
Steam heating special charges - - 149,231 42,029
Other 60,226 (21,800) 74,940 5,202
Changes in current assets and liabilities:
Customer accounts receivable and unbilled revenues 25,172 1,542 (2,443) (92,644)
Other accounts receivable (42,574) (5,508) (43,407) (14,242)
Inventories 3,774 18,579 27,038 4,618
Accounts payable (10,839) (270) (16,280) 24,981
Taxes payable 54,092 51,355 12,176 2,570
Interest payable (10,465) 14,705 (26,893) 17,529
Other (71,525) (85,602) 28,392 17,773
- -------------------------------------------------------------------------------------------------------------
Net cash from operating activities $ 234,856 $ 255,809 $1,061,141 $1,068,781
- -------------------------------------------------------------------------------------------------------------
INVESTING ACTIVITIES
Plant and equipment expenditures - regulated $ (85,568) $(101,225) $ (462,930) $ (469,835)
Plant and equipment expenditures - non-regulated (5,774) (14,534) (43,165) (14,534)
Nuclear decommissioning trust funds (9,262) (13,687) (47,246) (45,067)
Non-regulated investments (875) (5,584) (3,460) (5,184)
Other changes in current assets and liabilities 507 921 2,363 5,842
Other (230) 64 (29,562) (31,696)
- -------------------------------------------------------------------------------------------------------------
Net cash used for investing activities $(101,202) $(134,045) $ (584,000) $ (560,474)
- -------------------------------------------------------------------------------------------------------------
FINANCING ACTIVITIES
Issuance of long-term debt $ 6,600 $ 185,000 $ 45,500 $ 185,000
Funds received from Trustees: Installment sales
contracts and loan agreements - - - 201,525
Increase (decrease) in short-term borrowings (6,001) (36,990) 4,000 (137,936)
Redemption of long-term debt (45,214) - (220,928) (201,525)
Redemption of preferred stock - (185,000) - (185,955)
Premiums on reacquired long-term debt and preferred stock - (1,850) - (7,796)
Dividends on common stock (74,737) (74,737) (298,949) (298,633)
Other (68) (7,958) (4,673) (14,399)
- -------------------------------------------------------------------------------------------------------------
Net cash used for financing activities $(119,420) $(121,535) $ (475,050) $ (459,719)
- -------------------------------------------------------------------------------------------------------------
NET INCREASE IN CASH AND TEMPORARY
CASH INVESTMENTS $ 14,234 $ 229 $ 2,091 $ 48,588
CASH AND TEMPORARY CASH INVESTMENTS AT
BEGINNING OF THE PERIOD 53,034 64,948 65,177 16,589
- -------------------------------------------------------------------------------------------------------------
CASH AND TEMPORARY CASH INVESTMENTS AT END
OF THE PERIOD $ 67,268 $ 65,177 $ 67,268 $ 65,177
- -------------------------------------------------------------------------------------------------------------
SUPPLEMENTARY CASH FLOW INFORMATION
Interest paid (excluding interest capitalized) $ 77,136 $ 54,557 $ 299,859 $ 259,177
Income taxes paid 568 618 206,599 230,915
New capital lease obligations 32,546 297 66,846 29,356
Exchange of preferred stock of subsidiary for long-term debt - - - 49,878
=============================================================================================================
See accompanying Notes to Consolidated Financial Statements (Unaudited).
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6
DTE ENERGY COMPANY AND SUBSIDIARY COMPANIES
CONSOLIDATED BALANCE SHEET (UNAUDITED)
ASSETS
(Dollars in Thousands)
March 31 December 31
1997 1996
-------- -----------
UTILITY PROPERTIES
Electric plant in service $13,865,580 $13,776,535
Less: Accumulated depreciation and amortization (5,486,963) (5,367,110)
- ---------------------------------------------------------------------------------------------
$ 8,378,617 $ 8,409,425
Construction work in progress 72,686 91,242
- ---------------------------------------------------------------------------------------------
Net utility properties $ 8,451,303 $ 8,500,667
- ---------------------------------------------------------------------------------------------
Property under capital leases (less accumulated amortization
of $103,091 and $102,346, respectively) $ 155,998 $ 126,137
Nuclear fuel under capital lease (less accumulated amortization
of $474,242 and $473,788, respectively) 134,154 134,104
- ---------------------------------------------------------------------------------------------
Net property under capital leases $ 290,152 $ 260,241
- ---------------------------------------------------------------------------------------------
Total owned and leased properties $ 8,741,455 $ 8,760,908
- ---------------------------------------------------------------------------------------------
OTHER PROPERTY AND INVESTMENTS
Non-utility property $ 77,349 $ 72,152
Investments and special funds 47,285 47,543
Nuclear decommissioning trust funds 180,776 171,514
- ---------------------------------------------------------------------------------------------
$ 305,410 $ 291,209
- ---------------------------------------------------------------------------------------------
CURRENT ASSETS
Cash and temporary cash investments $ 67,268 $ 53,034
Customer accounts receivable and unbilled revenues (less allowance
for uncollectible accounts of $20,000) 415,304 440,476
Other accounts receivable 86,579 44,005
Inventories (at average cost)
Fuel 114,241 119,631
Materials and supplies 146,799 144,316
Prepayments 79,282 8,913
--------------------------------------------------------------------------------------------
$ 909,473 $ 810,375
--------------------------------------------------------------------------------------------
DEFERRED DEBITS
Regulatory assets $ 941,817 $ 975,351
Prepaid pensions 89,124 91,579
Unamortized debt expense 44,506 45,357
Other 21,310 40,150
- ---------------------------------------------------------------------------------------------
$ 1,096,757 $ 1,152,437
- ---------------------------------------------------------------------------------------------
TOTAL $11,053,095 $11,014,929
=============================================================================================
See accompanying Notes to Consolidated Financial Statements (Unaudited).
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7
DTE ENERGY COMPANY AND SUBSIDIARY COMPANIES
CONSOLIDATED BALANCE SHEET (UNAUDITED)
LIABILITIES
(Dollars in Thousands)
March 31 December 31
1997 1996
-------- -----------
CAPITALIZATION
Common stock - without par value, 400,000,000 shares
authorized; 145,101,736 and 145,119,875 shares
outstanding, respectively $ 1,951,193 $ 1,951,437
Retained earnings used in the business 1,488,360 1,492,417
- -------------------------------------------------------------------------------
Total common shareholders' equity $ 3,439,553 $ 3,443,854
Cumulative preferred stock of subsidiary 144,405 144,405
Long-term debt 3,740,734 3,779,334
- -------------------------------------------------------------------------------
Total Capitalization $ 7,324,692 $ 7,367,593
- -------------------------------------------------------------------------------
OTHER NON-CURRENT LIABILITIES
Obligations under capital leases $ 145,508 $ 115,742
Other postretirement benefits 372 5,516
Other 86,755 67,078
- -------------------------------------------------------------------------------
$ 232,635 $ 188,336
- -------------------------------------------------------------------------------
CURRENT LIABILITIES
Short-term borrowings $ 4,000 $ 10,001
Amounts due within one year
Long-term debt 144,214 144,214
Obligations under capital leases 144,644 144,499
Accounts payable 149,520 160,786
Property and general taxes 22,001 29,475
Income taxes 75,555 14,334
Accumulated deferred income taxes 45,134 44,418
Interest payable 49,940 60,405
Dividends payable 77,636 77,644
Payrolls 92,958 81,448
Fermi 2 refueling outage 4,876 1,349
Other 122,889 133,409
- -------------------------------------------------------------------------------
$ 933,367 $ 901,982
- -------------------------------------------------------------------------------
DEFERRED CREDITS
Accumulated deferred income taxes $ 2,014,333 $ 2,023,691
Accumulated deferred investment tax credits 311,248 315,030
Other 236,820 218,297
- -------------------------------------------------------------------------------
$ 2,562,401 $ 2,557,018
- -------------------------------------------------------------------------------
COMMITMENTS AND CONTINGENCIES (NOTE 3)
- -------------------------------------------------------------------------------
TOTAL $11,053,095 $11,014,929
===============================================================================
See accompanying Notes to Consolidated Financial Statements (Unaudited).
7
8
DTE ENERGY COMPANY AND SUBSIDIARY COMPANIES
CONSOLIDATED STATEMENT OF COMMON SHAREHOLDERS' EQUITY (UNAUDITED)
(Dollars in Thousands)
Retained Total
Common Stock Earnings Common
------------------- Used in the Shareholders'
Shares Amount Business Equity
- ----------------------------------------------------------------------------------------
BALANCE AT DECEMBER 31, 1996 145,119,875 $1,951,437 $1,492,417 $3,443,854
Net income 71,000 71,000
Cash dividends declared on
Common stock - $0.515 per share (74,728) (74,728)
Repurchase and retirement of
common stock (18,139) (244) (329) (573)
- ----------------------------------------------------------------------------------------
BALANCE AT MARCH 31, 1997 145,101,736 $1,951,193 $1,488,360 $3,439,553
========================================================================================
See accompanying Notes to Consolidated Financial Statements (Unaudited).
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THE DETROIT EDISON COMPANY AND SUBSIDIARY COMPANIES
CONSOLIDATED STATEMENT OF INCOME (UNAUDITED)
(Dollars in Thousands)
Three Months Ended Twelve Months Ended
March 31 March 31
------------------ -------------------
1997 1996 1997 1996
------------------ -------------------
OPERATING REVENUES
Electric - System $841,976 $887,627 $3,525,681 $3,585,049
Electric - Interconnection 10,936 11,244 44,816 54,884
Steam 11,244 10,020 26,811 24,228
-------------------------------------------------------------------------------------------
Total Operating Revenues $864,156 $908,891 $3,597,308 $3,664,161
-------------------------------------------------------------------------------------------
OPERATING EXPENSES
Operation
Fuel $152,462 $175,667 $ 672,333 $ 721,974
Purchased power 46,035 23,496 172,771 121,941
Other operation 157,381 149,211 649,069 647,135
Maintenance 69,632 73,611 273,806 261,255
Steam heating special charges - - 149,231 42,029
Depreciation and amortization 138,239 131,904 532,434 507,471
Deferred Fermi 2 amortization (747) (1,120) (4,106) (5,599)
Amortization of deferred Fermi 2 depreciation
and return 27,973 25,483 104,571 95,226
Taxes other than income 68,731 66,761 261,373 256,057
Income taxes 56,084 76,672 205,979 284,308
- --------------------------------------------------------------------------------------------
Total Operating Expenses $715,790 $721,685 $3,017,461 $2,931,797
- --------------------------------------------------------------------------------------------
OPERATING INCOME $148,366 $187,206 $ 579,847 $ 732,364
- --------------------------------------------------------------------------------------------
OTHER INCOME AND (DEDUCTIONS)
Allowance for other funds used
during construction $ 223 $ 388 $ 2,165 $ 1,481
Other income and (deductions) - net (5,289) (1,613) (19,036) (18,524)
Income taxes 1,607 303 5,235 5,094
Accretion income 1,591 2,327 7,489 10,354
Accretion expense (2,382) - (2,382) -
Income taxes 307 (686) (1,370) (3,112)
-------------------------------------------------------------------------------------------
Net Other Income and (Deductions) $ (3,943) $719 $ (7,899) $ (4,707)
-------------------------------------------------------------------------------------------
INTEREST CHARGES
Long-term debt $ 67,308 $ 68,360 $ 274,114 $ 275,535
Amortization of debt discount and expense 2,973 2,952 11,864 11,465
Other 512 1,551 2,897 7,316
Allowance for borrowed funds used during
construction (credit) (291) (702) (2,622) (2,584)
-------------------------------------------------------------------------------------------
Net Interest Charges $ 70,502 $ 72,161 $ 286,253 $ 291,732
-------------------------------------------------------------------------------------------
NET INCOME $ 73,921 $115,764 $ 285,695 $ 435,925
PREFERRED STOCK DIVIDENDS 2,907 7,293 11,629 27,623
- --------------------------------------------------------------------------------------------
NET INCOME AVAILABLE FOR COMMON STOCK $ 71,014 $108,471 $ 274,066 $ 408,302
============================================================================================
Note: Detroit Edison's financial statements are presented here for ease of
reference and are not considered to be part of Item 1 of the Company's
report.
See accompanying Notes to Consolidated Financial Statements (Unaudited).
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10
THE DETROIT EDISON COMPANY AND SUBSIDIARY COMPANIES
CONSOLIDATED BALANCE SHEET (UNAUDITED)
ASSETS
(Dollars in Thousands)
March 31 December 31
1997 1996
-----------------------
UTILITY PROPERTIES
Electric plant in service $13,865,580 $13,776,535
Less: Accumulated depreciation and amortization (5,486,963) (5,367,110)
--------------------------------------------------------------------------------------------
$ 8,378,617 $ 8,409,425
Construction work in progress 72,686 91,242
--------------------------------------------------------------------------------------------
Net utility properties $ 8,451,303 $ 8,500,667
--------------------------------------------------------------------------------------------
Property under capital leases (less accumulated amortization
of $103,091 and $102,346, respectively) $ 155,998 $ 126,137
Nuclear fuel under capital lease (less accumulated amortization
of $474,242 and $473,788, respectively) 134,154 134,104
--------------------------------------------------------------------------------------------
Net property under capital leases $ 290,152 $ 260,241
--------------------------------------------------------------------------------------------
Total owned and leased properties $ 8,741,455 $ 8,760,908
--------------------------------------------------------------------------------------------
OTHER PROPERTY AND INVESTMENTS
Non-utility property $ 7,423 $ 7,423
Investments and special funds 28,888 31,145
Nuclear decommissioning trust funds 180,776 171,514
--------------------------------------------------------------------------------------------
$ 217,087 $ 210,082
--------------------------------------------------------------------------------------------
CURRENT ASSETS
Cash and temporary cash investments $ 15,498 $ 2,465
Customer accounts receivable and unbilled revenues (less allowance
for uncollectible accounts of $20,000) 415,304 440,476
Other accounts receivable 81,779 41,367
Inventories (at average cost)
Fuel 114,241 119,631
Materials and supplies 146,799 144,316
Prepayments 78,914 8,394
--------------------------------------------------------------------------------------------
$ 852,535 $ 756,649
--------------------------------------------------------------------------------------------
DEFERRED DEBITS
Regulatory assets $ 941,817 $ 975,351
Prepaid pensions 89,124 91,579
Unamortized debt expense 44,409 45,247
Other 14,705 34,661
- ---------------------------------------------------------------------------------------------
$ 1,090,055 $ 1,146,838
- ---------------------------------------------------------------------------------------------
TOTAL $10,901,132 $10,874,477
=============================================================================================
See accompanying Notes to Consolidated Financial Statements (Unaudited).
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11
THE DETROIT EDISON COMPANY AND SUBSIDIARY COMPANIES
CONSOLIDATED BALANCE SHEET (UNAUDITED)
LIABILITIES
(Dollars in Thousands)
March 31 December 31
1997 1996
-------- -----------
CAPITALIZATION
Common stock - $10 par value, 400,000,000 shares authorized;
145,119,875 shares outstanding $ 1,451,199 $ 1,451,199
Premium on common stock 547,799 547,799
Common stock expense (47,561) (47,561)
Retained earnings used in the business 1,382,302 1,391,104
- ---------------------------------------------------------------------------------------
Total common shareholders' equity $ 3,333,739 $ 3,342,541
Cumulative preferred stock 144,405 144,405
Long-term debt 3,694,663 3,740,434
- ---------------------------------------------------------------------------------------
Total Capitalization $ 7,172,807 $ 7,227,380
- ---------------------------------------------------------------------------------------
OTHER NON-CURRENT LIABILITIES
Obligations under capital leases $ 145,508 $ 115,742
Other postretirement benefits 372 5,516
Other 86,755 67,078
- ---------------------------------------------------------------------------------------
$ 232,635 $ 188,336
- ---------------------------------------------------------------------------------------
CURRENT LIABILITIES
Short-term borrowings $ 4,000 $ 10,001
Amounts due within one year
Long-term debt 144,214 144,214
Obligations under capital leases 144,644 144,499
Accounts payable 146,336 158,594
Property and general taxes 21,718 29,455
Income taxes 77,599 15,959
Accumulated deferred income taxes 45,134 44,418
Interest payable 49,939 60,403
Dividends payable 82,723 82,723
Payrolls 92,719 81,181
Fermi 2 refueling outage 4,876 1,349
Other 121,277 131,840
- ---------------------------------------------------------------------------------------
$ 935,179 $ 904,636
- ---------------------------------------------------------------------------------------
DEFERRED CREDITS
Accumulated deferred income taxes $ 2,012,913 $ 2,022,550
Accumulated deferred investment tax credits 311,248 315,030
Other 236,350 216,545
- ---------------------------------------------------------------------------------------
$ 2,560,511 $ 2,554,125
- ---------------------------------------------------------------------------------------
COMMITMENTS AND CONTINGENCIES (NOTE 3)
- ---------------------------------------------------------------------------------------
TOTAL $10,901,132 $10,874,477
=======================================================================================
See accompanying Notes to Consolidated Financial Statements (Unaudited).
11
12
THE DETROIT EDISON COMPANY AND SUBSIDIARY COMPANIES
CONSOLIDATED STATEMENT OF CASH FLOWS (UNAUDITED)
(Dollars in Thousands)
Three Months Ended Twelve Months Ended
March 31 March 31
-----------------------------------------------
1997 1996 1997 1996
-----------------------------------------------
OPERATING ACTIVITIES
Net Income $ 73,921 $ 115,764 $ 285,695 $ 435,925
Adjustments to reconcile net income to net cash
from operating activities:
Accretion income (1,591) (2,327) (7,489) (10,354)
Accretion expense 2,382 - 2,382 -
Depreciation and amortization 138,239 131,904 532,434 507,471
Deferred Fermi 2 amortization and return - net 27,226 24,363 100,465 89,627
Deferred income taxes and investment tax credit - net (14,243) 16,935 (29,795) 53,182
Fermi 2 refueling outage - net 3,527 3,258 (12,724) 12,533
Steam heating special charges - - 149,231 42,029
Other 62,559 (19,125) 71,599 7,877
Changes in current assets and liabilities:
Customer accounts receivable and unbilled revenues 25,172 1,542 (2,443) (92,644)
Other accounts receivable (40,412) (3,272) (40,843) (12,006)
Inventories 3,774 18,579 27,038 4,618
Accounts payable (11,831) (7,293) (12,441) 17,958
Taxes payable 54,248 52,052 13,240 3,267
Interest payable (10,464) 14,684 (26,873) 17,508
Other (71,691) (98,395) 28,720 4,980
- -----------------------------------------------------------------------------------------------------------
Net cash from operating activities $ 240,816 $ 248,669 $1,078,196 $1,081,971
- -----------------------------------------------------------------------------------------------------------
INVESTING ACTIVITIES
Plant and equipment expenditures $ (85,568) $(101,225) $ (462,930) $ (469,835)
Nuclear decommissioning trust funds (9,262) (13,687) (47,246) (45,067)
Other changes in current assets and liabilities 507 921 2,363 5,842
Other 546 11,369 (31,530) (19,991)
- -----------------------------------------------------------------------------------------------------------
Net cash used for investing activities $ (93,777) $(102,622) $ (539,343) $ (529,051)
- -----------------------------------------------------------------------------------------------------------
FINANCING ACTIVITIES
Issuance of long-term debt $ - $ 185,000 $ - $ 185,000
Funds received from Trustees: Installment sales
contracts and loan agreements - - - 201,525
Increase (decrease) in short-term borrowings (6,001) (36,990) 4,000 (137,936)
Redemption of long-term debt (45,214) - (220,928) (201,525)
Redemption of preferred stock - (185,000) - (185,955)
Premiums on reacquired long-term debt and
preferred stock - (1,850) - (7,796)
Dividends on common and preferred stock (82,723) (85,509) (329,022) (329,735)
Cash portion of restructuring dividend to parent - (56,510) - (56,510)
Other (68) (4,478) (3,063) (10,919)
- -----------------------------------------------------------------------------------------------------------
Net cash used for financing activities $(134,006) $(185,337) $ (549,013) $ (543,851)
- -----------------------------------------------------------------------------------------------------------
NET INCREASE (DECREASE) IN CASH AND TEMPORARY
CASH INVESTMENTS $ 13,033 $ (39,290) $ (10,160) $ 9,069
CASH AND TEMPORARY CASH INVESTMENTS AT
BEGINNING OF THE PERIOD 2,465 64,948 25,658 16,589
- -----------------------------------------------------------------------------------------------------------
CASH AND TEMPORARY CASH INVESTMENTS AT END
OF THE PERIOD $ 15,498 $ 25,658 $ 15,498 $ 25,658
- -----------------------------------------------------------------------------------------------------------
SUPPLEMENTARY CASH FLOW INFORMATION
Interest paid (excluding interest capitalized) $ 77,055 $ 54,557 $ 299,516 $ 259,177
Income taxes paid 568 618 209,262 230,915
New capital lease obligations 32,546 297 66,846 29,356
Exchange of preferred stock for long-term debt - - - 49,878
Non-cash portion of restructuring dividend to parent - 26,716 - 26,716
===========================================================================================================
See accompanying Notes to Consolidated Financial Statements (Unaudited).
12
13
THE DETROIT EDISON COMPANY AND SUBSIDIARY COMPANIES
CONSOLIDATED STATEMENT OF COMMON SHAREHOLDERS' EQUITY (UNAUDITED)
(Dollars in Thousands)
Common Stock Premium Retained Total
-------------------- on Common Earnings Common
$10 Par Common Stock Used in the Shareholders'
Shares Value Stock Expense Business Equity
- -----------------------------------------------------------------------------------------------------------
BALANCE AT DECEMBER 31, 1996 145,119,875 $1,451,199 $547,799 $(47,561) $1,391,104 $3,342,541
Net income 73,921 73,921
Cash dividends declared
Common stock - $0.55 per share (79,816) (79,816)
Cumulative preferred stock* (2,907) (2,907)
- -----------------------------------------------------------------------------------------------------------
BALANCE AT MARCH 31, 1997 145,119,875 $1,451,199 $547,799 $(47,561) $1,382,302 $3,333,739
===========================================================================================================
*At established rate for each series
See accompanying Notes to Consolidated Financial Statements (Unaudited).
13
14
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
DTE ENERGY COMPANY, THE DETROIT EDISON COMPANY AND SUBSIDIARY COMPANIES
NOTE 1 - ANNUAL REPORT NOTES
These consolidated financial statements should be read in conjunction with
the Annual Report Notes. The Notes contained herein update and supplement
matters discussed in the Annual Report Notes.
The preparation of the financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.
The preceding consolidated financial statements are unaudited, but in the
opinion of the Company and Detroit Edison, with respect to its own financial
statements, include all adjustments necessary for a fair statement of the
results for the interim periods. Financial results for this interim period are
not necessarily indicative of results that may be expected for any other
interim period or for the fiscal year.
NOTE 2 - FERMI 2
As discussed in Note 2 of the Annual Report Notes, on January 17, 1997,
the Fermi 2 plant was shut down for inspection of the internal components of
the plant's generator and required repairs and testing. Detroit Edison expects
that the unit will be back in service during the second quarter of 1997. The
costs of the repairs are expected to be covered by insurance. During the first
quarter of 1997, $24 million was recorded for additional Fermi 2 capacity
factor performance standard disallowances that are expected to be imposed by
the MPSC for the period 1997 - 1999, principally as a result of the outage
period caused by this shutdown.
Effective April 1, 1997, extra expense insurance, which includes certain
replacement power costs, is available following a 17 week deductible.
NOTE 3 - COMMITMENTS AND CONTINGENCIES
As discussed in Note 12 of the Annual Report Notes, a class action is
pending in the Circuit Court for Wayne County, Michigan (Gilford, et al v
Detroit Edison) in which plaintiffs are alleging that Detroit Edison has
engaged in age and racial discrimination. A notice was sent to potential class
members; and in response to such notice, approximately 1,000 individuals have
opted out of the class and approximately 450 individuals have given information
of purported discriminatory treatment. Approximately 2,750 individuals have
not responded in any fashion to the notice. Detroit Edison is of the opinion
that the allegations of discrimination are without merit.
14
15
As discussed in Note 12 of the Annual Report Notes, in January 1989, the
EPA issued an administrative order under the Comprehensive Environmental
Response, Compensation and Liability Act ordering Detroit Edison and 23 other
potentially responsible parties to begin removal activities at the Carter
Industrials Superfund site. Clean-up of the Carter Industrials site began in
1995 and was completed in the spring of 1996. An additional clean-up of the
sewer and sewer out-fall emptying into the Detroit River was completed in
November 1996. On March 25, 1997, the EPA published its decision to remove the
site from the National Priorities List.
----------------------------------
This Quarterly Report on Form 10-Q, including the report of Deloitte &
Touche LLP (on page 16) will automatically be incorporated by reference in the
Prospectuses constituting part of the Registration Statements on Form S-3
(Registration Nos. 33-53207 and 33-64296) of The Detroit Edison Company and
Form S-8 (Registration No. 333-00023) and Form S-3 (Registration No. 33-57545)
of DTE Energy Company, filed under the Securities Act of 1933. Such report of
Deloitte & Touche LLP, however, is not a "report" or "part of the Registration
Statement" within the meaning of Sections 7 and 11 of the Securities Act of
1933 and the liability provisions of Section 11(a) of such Act do not apply.
15
16
INDEPENDENT ACCOUNTANTS' REPORT
To the Board of Directors and Shareholders of DTE Energy Company and
The Detroit Edison Company
We have reviewed the accompanying condensed consolidated balance sheets of
DTE Energy Company and subsidiary companies and of The Detroit Edison Company
and subsidiary companies as of March 31, 1997, and the related condensed
consolidated statements of income and of cash flows for the three-month and
twelve-month periods ended March 31, 1997 and 1996, and the condensed
consolidated statements of common shareholders' equity for the three-month
period ended March 31, 1997. These financial statements are the responsibility
of DTE Energy Company's management and of The Detroit Edison Company's
management.
We conducted our reviews in accordance with standards established by the
American Institute of Certified Public Accountants. A review of interim
financial information consists principally of applying analytical procedures to
financial data and of making inquiries of persons responsible for financial and
accounting matters. It is substantially less in scope than an audit conducted
in accordance with generally accepted auditing standards, the objective of
which is the expression of an opinion regarding the financial statements taken
as a whole. Accordingly, we do not express such an opinion.
Based on our reviews, we are not aware of any material modifications that
should be made to such condensed consolidated financial statements for them to
be in conformity with generally accepted accounting principles.
We have previously audited, in accordance with generally accepted auditing
standards, the consolidated balance sheets of DTE Energy Company and subsidiary
companies and of The Detroit Edison Company and subsidiary companies as of
December 31, 1996, and the related consolidated statements of income, common
shareholders' equity, and cash flows for the year then ended (not presented
herein); and in our report dated January 27, 1997 we expressed an unqualified
opinion on those consolidated financial statements. In our opinion, the
information set forth in the accompanying condensed consolidated balance sheets
as of December 31, 1996 is fairly stated, in all material respects, in relation
to the consolidated balance sheets from which it has been derived.
DELOITTE & TOUCHE LLP
Detroit, Michigan
May 1, 1997
16
17
ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS.
DTE ENERGY COMPANY, THE DETROIT EDISON COMPANY AND SUBSIDIARY
COMPANIES
This analysis for the three and twelve months ended March 31, 1997, as
compared to the same periods in 1996, should be read in conjunction with the
consolidated financial statements (unaudited), the accompanying Notes and the
Annual Report Notes.
Detroit Edison is the principal subsidiary of the Company and, as such,
this discussion explains material changes in results of operations of both the
Company and Detroit Edison and identifies recent trends and events affecting
both the Company and Detroit Edison. For the periods presented, the Company's
operations and those of Detroit Edison are substantially the same.
RESULTS OF OPERATIONS
For the three months ended March 31, 1997, the Company's net income was
$71.0 million, or $0.49 per common share, down 34.5 percent from the $108.4
million, or $0.75 per common share earned in the three months ended March 31,
1996. For the twelve months ended March 31, 1997, the Company's net income was
$271.9 million, or $1.87 per common share, down 33 percent from the $408.3
million, or $2.82 per common share earned in the twelve months ended March 31,
1996. The decreases in net income were due primarily to a repair and
maintenance outage at Fermi 2 which increased the Fermi 2 capacity factor
performance standard reserve for the period 1997-1999, lower electricity sales
and, to a lesser extent, the cost of responding to the March 1997 catastrophic
ice storm. In addition, for the twelve-month period, a $149.2 million ($97
million after-tax), or $0.67 per common share, special charge to net income was
made in the third quarter of 1996 following completion of Detroit Edison's
review of its steam heating operations.
At March 31, 1997, the book value of the Company's common stock was $23.67
per share, a decrease of $0.02 per share or 0.08% since December 31, 1996.
Return on average total common shareholders' equity was 7.8% and 11.8% for the
twelve months ended March 31, 1997 and 1996, respectively.
The Company's ratio of earnings to fixed charges was 2.50 and 3.22 for the
twelve months ended March 31, 1997 and 1996, respectively. The Company's ratio
of earnings to fixed charges and preferred stock dividends for the 1997 and
1996 twelve-month periods was 2.36 and 2.83, respectively.
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18
OPERATING REVENUES
Total operating revenues of the Company increased (decreased) due to the
following factors:
Three Twelve
Months Months
------ ------
(Millions)
Rate Changes
Long-term service contracts $ (3) $ (8)
PSCR Clause 4 6
Conservation programs (3) (6)
------ ------
(2) (8)
System sales volume and mix (11) (25)
Interconnection sales - (10)
Fermi 2 capacity factor performance
standard reserve (24) (18)
Other - net (4) 1
------ ------
Total $ (41) $ (60)
====== ======
kWh SALES
- ---------
kWh sales increased (decreased) as follows:
Three Twelve
Months Months
------- -------
Residential (1.8)% (2.3)%
Commercial (1.2) (0.1)
Industrial 1.9 1.6
Other (includes primarily sales for resale) (16.5) (5.5)
Total System (1.1) (0.4)
Interconnection (35.4) (44.1)
Total (3.0) (3.3)
The decreases in residential and commercial sales reflect warmer winter
weather, and for the twelve-month period, cooler summer weather that more than
offset growth in the customer base.
The increases in industrial sales reflect strong demand in the automotive
and construction sectors.
The decreased sales to other customers reflect decreased demand from
wholesale for resale customers.
Interconnection sales decreases reflect lower demand for energy and the
impact of the Fermi 2 outage.
18
19
FERMI 2 CAPACITY FACTOR PERFORMANCE STANDARD RESERVE
Due to a repair and maintenance outage at Fermi 2 the capacity factor
performance standard reserve was increased by $24 million during the first
quarter of 1997.
OPERATING EXPENSES
FUEL AND PURCHASED POWER
Fuel and purchased power expenses increased (decreased) due to the following
factors:
Three Twelve
Months Months
------ ------
(Millions)
Net system output $(5) $(23)
Average unit cost 11 19
Fermi 2 business interruption insurance (6) 5
Steam heating special charge amortization (3) (3)
Other 2 3
------ ------
Total $ (1) $ 1
====== =======
Net system output and average fuel and purchased power unit costs were as
follows:
Three Months Twelve Months
1997 1996 1997 1996
--------- --------- --------- ---------
(Thousands of Megawatthours, "MWh")
Power plant generation
Fossil 10,352 10,503 41,692 41,809
Nuclear - 1,785 2,951 6,630
Purchased power 2,204 621 6,732 4,480
--------- --------- --------- ---------
Net system output 12,556 12,909 51,375 52,919
========= ========= ========= =========
Average unit cost ($/MWh) $ 14.92 $ 14.03 $ 15.25 $ 14.88
========= ========= ========= =========
Fuel and purchased power expense decreased in the three-month period due
to the receipt of Fermi 2 business interruption insurance proceeds, lower net
system output, and the steam heating special charge amortization partially
offset by higher average unit costs resulting from increased usage of higher
cost purchased power replacing lower cost nuclear generation as a result of the
Fermi 2 outage.
For the twelve-month period, fuel and purchased power expense increased
due to higher average unit costs resulting from increased usage of higher cost
purchased power replacing lower cost nuclear generation as a result of the
Fermi 2 outage,
19
20
increased coal contract buyout expense and a reduction in the receipt of Fermi
2 business interruption insurance proceeds, partially offset by lower net
system output and the steam heating special charge amortization.
OTHER OPERATION
Three Months
Other operation expense increased primarily due to higher administrative
and general expenses ($7.6 million), non-regulated subsidiaries ($4 million)
and major storm ($2 million) expenses.
Twelve Months
Other operation expense increased due primarily to higher sales expenses
($12.7 million), operating and development expense related to new computer
systems ($12 million), higher uncollectible customer accounts ($11.3 million)
and non-regulated subsidiaries ($10.4 million) expenses. These expenses were
partially offset by lower incentive award expenses related to a shareholder
value improvement plan ($14.3 million), expenses recorded in the year-earlier
period in a reserve for the write-off of obsolete and excess stock material
($12 million) and the settlement of the Ludington Pumped Storage Plant fish
mortality case ($8.4 million).
MAINTENANCE
Three Months
Maintenance expense decreased due to lower overhead and underground lines
support ($3 million), general property ($2.9 million) and transmission and
distribution ($2.2 million) expenses. These decreases were partially offset by
higher major storm expenses ($3.7 million).
Twelve Months
Maintenance expense increased due to higher overhead and underground lines
support ($14.7 million), nuclear plant ($5 million) and station maintenance
($4.1 million) expenses. These increases were partially offset by lower
transmission and distribution ($6.2 million) and major storm ($3.3 million)
expenses.
STEAM HEATING SPECIAL CHARGES
During the third quarter of 1996, following the completion of a review of
its steam heating operations, Detroit Edison recorded a special charge to net
income of $149.2 million. The special charge included a reserve for steam
purchase commitments during the period 1997 through 2008 under the agreement
with the Detroit Resource Recovery Facility, and for expenditures in 1997 for
closure of a portion of the steam heating
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21
system and improvements in service to remaining customers. Beginning in 1997,
Detroit Edison recorded amortization of the reserve for steam purchase
commitments in fuel and purchased power expense.
DEPRECIATION AND AMORTIZATION
Depreciation and amortization expense increased due primarily to increases
in plant in service, including internally developed software costs.
DEFERRED FERMI 2 AMORTIZATION
Deferred Fermi 2 amortization, a non-cash item of income, was recorded
beginning with Detroit Edison's purchase of the Wolverine Power Supply
Cooperative, Inc.'s ownership interest in Fermi 2 in February 1990. The annual
amount deferred decreases each year through 1999.
AMORTIZATION OF DEFERRED FERMI 2 DEPRECIATION AND RETURN
Deferred Fermi 2 depreciation and return, non-cash items of income, were
recorded beginning with the implementation of the Fermi 2 rate phase-in plan in
January 1988. The annual amounts of deferred depreciation and return decreased
each year through 1992. Beginning in 1993 and continuing through 1998, these
deferred amounts will be amortized to operating expense as the cash recovery is
realized through revenues.
TAXES OTHER THAN INCOME TAXES
Taxes other than income taxes increased due to higher MPSC assessment
fees, partially offset by lower payroll taxes.
INCOME TAXES
Three Months
Income taxes decreased due to lower pretax income.
Twelve Months
Income taxes decreased due to lower pretax income, partially offset by
changes in the prior years' federal income tax accrual and filed return
adjustments.
21
22
OTHER INCOME AND DEDUCTIONS
OTHER INCOME AND (DEDUCTIONS) - NET
Three Months
Other deductions increased due primarily to an increase in the write-off
of unamortized expenses related to the open market purchases of Mortgage Bonds
($1.6 million), an increase in expenses related to merchandising, jobbing and
contract work ($1.1 million), and higher legal expenses ($0.7 million).
Twelve Months
Other deductions decreased due primarily to lower corporate contributions
($2.3 million), partially offset by an increase in promotional expenses ($1
million).
ACCRETION INCOME
Accretion income, a non-cash item of income, was recorded beginning in
January 1988 to restore to income, over the period 1988-1998, losses recorded
due to discounting indirect disallowances of plant costs. The annual amount of
accretion income recorded decreases each year through 1998.
ACCRETION EXPENSE
Accretion expense, a non-cash item of expense, was recorded beginning in
January 1997 to charge to income, over the period 1997-2008, accretion of
interest expense resulting from the recording of the reserve for steam purchase
commitments at its present value at December 31, 1996, using a risk free
discount rate of 6.9%.
INTEREST CHARGES
LONG-TERM DEBT
Long-term debt interest charges decreased due to the scheduled and early
redemption of Mortgage Bonds, partially offset by the issuance of QUIDS.
OTHER
Other interest charges decreased due primarily to lower levels of
short-term borrowings.
22
23
PREFERRED STOCK DIVIDENDS OF DETROIT EDISON
Three Months
Preferred stock dividends of Detroit Edison decreased due to the
redemption of Cumulative Preferred Stock, 7.68% Series, 7.45% Series and 7.36%
Series.
Twelve Months
Preferred stock dividends of Detroit Edison decreased due to the
redemption of Cumulative Preferred Stock, 7.68% Series, 7.45% Series and 7.36%
Series and the exchange of a portion of Cumulative Preferred Stock 7.75% Series
for QUIDS and the conversion and redemption of Cumulative Preferred Stock 5.5%
Convertible Series.
LIQUIDITY AND CAPITAL RESOURCES
PRIVATE SECURITIES LITIGATION REFORM ACT -
FORWARD-LOOKING STATEMENTS
Certain information presented in this Quarterly Report on Form 10-Q is
based upon the expectations of the Company and Detroit Edison and, as such, is
forward-looking. The Private Securities Litigation Reform Act of 1995
encourages reporting companies to provide analyses and estimates of future
prospects and also permits reporting companies to point out that actual results
may differ from those anticipated.
Actual results for the Company and Detroit Edison may differ from those
expected due to a number of variables including, but not limited to, the impact
of newly-required FERC tariffs, actual sales and expenses, the effects of
competition, the implementation of utility restructuring in Michigan (which
involves pending regulatory proceedings, pending and proposed statutory
changes, and the recovery of stranded costs), environmental and nuclear
requirements and the success of non-utility projects. While the Company and
Detroit Edison believe that estimates given accurately measure the expected
outcome, actual results could vary materially due to the variables mentioned as
well as others.
COMPETITION
THE DETROIT EDISON COMPANY
MPSC. The MPSC Staff Report on Electric Industry Restructuring was filed
in December 1996. The Staff Report recognized that Michigan utilities should
have the opportunity to prepare for competition and be able to maintain their
financial health.
In an order dated February 5, 1997, the MPSC requested that Detroit Edison
and Consumers Energy Company make informational filings with the MPSC to
disclose how they would propose to implement the Staff Report on Electric
Industry Restructuring. The
23
24
filings were to include, among other items, detailed calculations of
anticipated stranded costs and transition charges.
As discussed in the Company's Form 8-K, filed on March 13, 1997, Detroit
Edison filed its response with the MPSC on March 7, 1997 highlighting the
following points:
- Detroit Edison estimates the net after-tax present value of its
stranded costs with reciprocity to be $5.4 billion.
- To mitigate the stranded costs, Detroit Edison proposed securitizing
approximately $2.8 billion in assets, direct access phase-in
totaling $1.4 billion, self-mitigation of $0.8 billion and a
non-bypassable nuclear decommissioning surcharge of $0.4 billion.
- Implementing securitization will result in an annual net rate decrease
for all customers totaling $295 million.
- Transition charges would only be assessed to customers leaving the
system.
- Endorsement of a bidding program to allocate capacity between
customers interested in direct access.
- Deregulation of electric markets will result in financial
uncertainty and risk to the shareholders of the Company. Detroit
Edison will bear the risk of full replacement of electricity sales lost
to retail wheeling, plus approximately an additional $800 million in
mitigation responsibility which should be in place during the 2001-2004
time period, and which Detroit Edison anticipates will be achieved
largely through reductions in operating and maintenance expenses.
The MPSC has held public hearings on the informational filings and has
received additional written comments.
CASH GENERATION AND CASH REQUIREMENTS
CONSOLIDATED STATEMENT OF CASH FLOWS (UNAUDITED)
Net cash from operating activities decreased due primarily to lower net
income before non-cash charges and changes in current assets and liabilities.
Net cash used for investing activities was lower in the three-month
period, due to decreased plant and equipment expenditures. Net cash used for
financing activities was higher in the twelve-month period due primarily to
increased non-regulated plant and equipment expenditures.
Net cash used for financing activities was lower in the three-month period
due primarily to a decrease in funds used to reduce short-term borrowings and
Detroit Edison's cash portion of a restructuring dividend to the Company in the
prior period. Net
24
25
cash used for financing activities was higher in the twelve-month period due
primarily to higher redemption of long-term debt.
ADDITIONAL INFORMATION
During the period January through April 28, 1997, Detroit Edison purchased
a total of $40.5 million of Mortgage Bonds on the open market, consisting of
$19 million of 7.74% 1993 Series J, $7 million of 7.81% 1993 Series E, $4.5
million of 7.78% 1993 Series E and $10 million of 7.79% 1993 Series E. These
bonds have been canceled.
Detroit Edison's 1997 cash requirements for its capital expenditure
program are estimated at $448 million, of which $86 million had been expended
as of March 31, 1997. Internal cash generation is expected to be sufficient to
meet its cash requirements for capital expenditures as well as scheduled
long-term debt redemptions.
Detroit Edison had short-term credit arrangements of approximately $464
million at March 31, 1997, under which $4 million of borrowings were
outstanding.
NON-REGULATED INVESTMENTS
Cash requirements for non-regulated investments are estimated to range
from $300 to $350 million in 1997, of which $6 million had been expended as of
March 31, 1997. Non-regulated investments are expected to be substantially
externally financed.
CAPITALIZATION
The Company's capital structure as of March 31, 1997 was 46.9% common
shareholders' equity, 2.0% cumulative preferred stock of subsidiary and 51.1%
long-term debt (which includes 3.2% of QUIDS) as compared to 46.7%, 2.0% and
51.3%, respectively, at December 31, 1996.
OTHER
In 1997 the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards No. 128, "Earnings per Share." The Company does
not expect the application of this statement to have a material impact on its
financial position, liquidity or results of operations.
25
26
DTE ENERGY COMPANY
PART II - OTHER INFORMATION
ITEM 1 - LEGAL PROCEEDINGS.
A former Detroit Edison employee has filed a lawsuit in the U.S. District
Court for the Southern District of Michigan alleging that Detroit Edison
engaged in age discrimination and procedural violations of the Federal Age
Discrimination in Employment Act of 1967. In the lawsuit, (Frazier,
individually and on behalf of all similarly situated Detroit Edison voluntary
separation offer recipients v Detroit Edison) plaintiff seeks to represent a
group of individuals who accepted voluntary separation offers from Detroit
Edison. Detroit Edison is of the opinion that the allegations of the lawsuit
are without merit.
For information on further legal proceedings, see Note 3 herein.
ITEM 5 - OTHER INFORMATION.
The Company, through its non-regulated subsidiary Edison Energy Services,
Inc., has reached a tentative agreement to acquire the coke oven battery and
related assets in River Rouge, Michigan from National Steel Corporation
("NSC"). NSC will continue to operate and maintain the facility under contract
with the Company. A majority of the coke production will be dedicated to
meeting NSC's requirements under a twelve year supply agreement. The
acquisition is expected to provide gross revenues between $100 and $150 million
per year. The acquisition is subject to the Company and NSC reaching final
agreement on all aspects of the transaction, as well as regulatory review and
approval of both companies' boards of directors.
26
27
QUARTERLY REPORT ON FORM 10-Q FOR
THE DETROIT EDISON COMPANY
PART I - FINANCIAL INFORMATION
ITEM 1 - FINANCIAL STATEMENTS (UNAUDITED).
See pages 9 through 15.
ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATION.
See the Company's and Detroit Edison's "Item 2 - Management's Discussion
and Analysis of Financial Condition and Results of Operations," which is
incorporated herein by this reference.
PART II - OTHER INFORMATION
ITEM 1 - LEGAL PROCEEDINGS.
See the Company's "Item 1 - Legal Proceedings," which is incorporated
herein by this reference.
ITEM 5 - OTHER INFORMATION.
See the Company's "Item 5 - Other Information" which is incorporated
herein by this reference.
27
28
QUARTERLY REPORTS ON FORM 10-Q FOR
DTE ENERGY COMPANY AND THE DETROIT EDISON COMPANY
ITEM 6 - EXHIBITS AND REPORTS ON FORM 8-K.
(a) Exhibits
(i) Exhibits filed herewith.
Exhibit
Number
-------
*10-6 - Detroit Edison Executive Incentive Plan.
*10-7 - 1997 Detroit Edison Executive Incentive Plan Measures.
11-7 - DTE Energy Company and Subsidiary Companies Primary
and Fully Diluted Earnings Per Share of Common Stock.
15-4 - Awareness Letter of Deloitte & Touche LLP regarding
their report dated May 1, 1997.
27-11 - Financial Data Schedule for the period ended March
31, 1997 for DTE Energy Company and Subsidiary Companies.
27-12 - Financial Data Schedule for the period ended March
31, 1997 for The Detroit Edison Company and Subsidiary
Companies.
(ii) Exhibits incorporated herein by reference.
3(a) - Restated Articles of Incorporation of Detroit Edison,
as filed December 10, 1991 with the State of Michigan, Department
of Commerce - Corporation and Securities Bureau (Exhibit 4-117 to
Form 10-Q for quarter ended March 31, 1993).
3(b) - Certificate containing resolution of the Detroit
Edison Board of Directors establishing the Cumulative Preferred
Stock, 7.75% Series as filed February 22, 1993 with the State of
Michigan, Department of Commerce - Corporation and Securities
Bureau (Exhibit 4-134 to Form 10-Q for quarter ended March 31,
1993).
3(c) - Certificate containing resolution of the Detroit
Edison Board of Directors establishing the Cumulative Preferred
Stock, 7.74% Series, as filed April 21, 1993 with the State of
Michigan, Department of Commerce - Corporation and Securities
Bureau (Exhibit 4-140 to Form 10-Q for quarter ended March 31,
1993).
28
29
Exhibit
Number
-------
3(d) - Amended and Restated Articles of Incorporation of DTE
Energy Company, dated December 13, 1995 (Exhibit 3A (3.1) to DTE
Energy Form 8-B filed January 2, 1996, File No. 1-11607).
3(e) - Agreement and Plan of Exchange (Exhibit 1(2) to DTE
Energy Form 8-B filed January 2, 1996, File No. 1-11607).
3(f) - Amended and Restated By-Laws, dated as of February
26, 1996, of the Company (Exhibit 3-3 to Form 10-K for year
ended December 31, 1996).
3(g) - Amended and Restated By-Laws, dated as of February
26, 1996, of Detroit Edison (Exhibit 3-4 to Form 10-K for year
ended December 31, 1996).
4(a) - Mortgage and Deed of Trust, dated as of October 1,
1924, between Detroit Edison (File No. 1-2198) and Bankers Trust
Company as Trustee (Exhibit B-1 to Registration No. 2-1630) and
indentures supplemental thereto, dated as of dates indicated
below, and filed as exhibits to the filings as set forth below:
September 1, 1947 Exhibit B-20 to Registration No. 2-7136
October 1, 1968 Exhibit 2-B-33 to Registration No. 2-30096
November 15, 1971 Exhibit 2-B-38 to Registration No. 2-42160
January 15, 1973 Exhibit 2-B-39 to Registration No. 2-46595
June 1, 1978 Exhibit 2-B-51 to Registration No. 2-61643
June 30, 1982 Exhibit 4-30 to Registration No. 2-78941
August 15, 1982 Exhibit 4-32 to Registration No. 2-79674
October 15, 1985 Exhibit 4-170 to Form 10-K for year ended
December 31, 1994
November 30, 1987 Exhibit 4-139 to Form 10-K for year ended
December 31, 1992
July 15, 1989 Exhibit 4-171 to Form 10-K for year ended
December 31, 1994
December 1, 1989 Exhibit 4-172 to Form 10-K for year ended
December 31, 1994
February 15, 1990 Exhibit 4-173 to Form 10-K for year ended
December 31, 1994
April 1, 1991 Exhibit 4-15 to Form 10-K for year ended
December 31, 1996
May 1, 1991 Exhibit 4-178 to Form 10-K for year ended
December 31, 1996
May 15, 1991 Exhibit 4-179 to Form 10-K for year ended
December 31, 1996
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30
Exhibit
Number
-------
September 1, 1991 Exhibit 4-180 to Form 10-K for year ended
December 31, 1996
November 1, 1991 Exhibit 4-181 to Form 10-K for year ended
December 31, 1996
January 15, 1992 Exhibit 4-182 to Form 10-K for year ended
December 31, 1996
February 29, 1992 Exhibit 4-121 to Form 10-Q for quarter
ended March 31, 1992
April 15, 1992 Exhibit 4-122 to Form 10-Q for quarter
ended June 30, 1992
July 15, 1992 Exhibit 4-123 to Form 10-Q for quarter
ended September 30, 1992
July 31, 1992 Exhibit 4-124 to Form 10-Q for quarter
ended September 30, 1992
November 30, 1992 Exhibit 4-130 to Registration No. 33-56496
January 1, 1993 Exhibit 4-131 to Registration No. 33-56496
March 1, 1993 Exhibit 4-141 to Form 10-Q for quarter
ended March 31, 1993
March 15, 1993 Exhibit 4-142 to Form 10-Q for quarter
ended March 31, 1993
April 1, 1993 Exhibit 4-143 to Form 10-Q for quarter
ended March 31, 1993
April 26, 1993 Exhibit 4-144 to Form 10-Q for quarter
ended March 31, 1993
May 31, 1993 Exhibit 4-148 to Registration No. 33-64296
June 30, 1993 Exhibit 4-149 to Form 10-Q for quarter
ended June 30, 1993 (1993 Series AP)
June 30, 1993 Exhibit 4-150 to Form 10-Q for quarter
ended June 30, 1993 (1993 Series H)
September 15, 1993 Exhibit 4-158 to Form 10-Q for quarter
ended September 30, 1993
March 1, 1994 Exhibit 4-163 to Registration No. 33-53207
June 15, 1994 Exhibit 4-166 to Form 10-Q for
quarter ended June 30, 1994
August 15, 1994 Exhibit 4-168 to Form 10-Q for quarter
ended September 30, 1994
December 1, 1994 Exhibit 4-169 to Form 10-K for year ended
December 31, 1994
August 1, 1995 Exhibit 4-174 to Form 10-Q for quarter
ended September 30, 1995
4(b) - Collateral Trust Indenture (notes), dated as of June
30, 1993 (Exhibit 4-152 to Registration No. 33-50325).
30
31
Exhibit
Number
------
4(c) - First Supplemental Note Indenture, dated as of June
30, 1993 (Exhibit 4-153 to Registration No. 33-50325).
4(d) - Second Supplemental Note Indenture, dated as of
September 15, 1993 (Exhibit 4-159 to Form 10-Q for quarter ended
September 30, 1993).
4(e) - First Amendment, dated as of August 15, 1996, to
Second Supplemental Note Indenture (Exhibit 4-17 to Form 10-Q
for quarter ended September 30, 1996).
4(f) - Third Supplemental Note Indenture, dated as of August
15, 1994 (Exhibit 4-169 to Form 10-Q for quarter ended September
30, 1994).
4(g) - First Amendment, dated as of December 12, 1995, to
Third Supplemental Note Indenture, dated as of August 15, 1994
(Exhibit 4-12 to Registration No. 333-00023).
4(h) - Fourth Supplemental Note Indenture, dated as of
August 15, 1995 (Exhibit 4-175 to Detroit Edison Form 10-Q for
quarter ended September 30, 1995).
4(i) - Fifth Supplemental Note Indenture, dated as of
February 1, 1996 (Exhibit 4-14 to Form 10-K for year ended
December 31, 1996).
4(j) - Standby Note Purchase Credit Facility, dated as of
August 17, 1994, among The Detroit Edison Company, Barclays Bank
PLC, as Bank and Administrative Agent, Bank of America, The Bank
of New York, The Fuji Bank Limited, The Long-Term Credit Bank of
Japan, LTD, Union Bank and Citicorp Securities, Inc. and First
Chicago Capital Markets, Inc. as Remarketing Agents (Exhibit
99-18 to Form 10-Q for quarter ended September 30, 1994).
4(k) - Support Agreement, dated as of March 8, 1996, between
the Company and Detroit Edison (Exhibit 4-176 to Form 10-Q for
quarter ended March 31, 1996).
99(a) - Belle River Participation Agreement between Detroit
Edison and Michigan Public Power Agency, dated as of December
1, 1982 (Exhibit 28-5 to Registration No. 2-81501).
99(b) - Belle River Transmission Ownership and Operating
Agreement between Detroit Edison and Michigan Public Power
Agency, dated as of December 1, 1982 (Exhibit 28-6 to
Registration No. 2-81501.)
31
32
Exhibit
Number
-------
99(c) -1988 Amended and Restated Loan Agreement, dated as
of October 4, 1988, between Renaissance Energy Company (an
unaffiliated company) ("Renaissance") and Detroit Edison (Exhibit
99-6 to Registration No. 33-50325).
99(d) -First Amendment to 1988 Amended and Restated Loan
Agreement, dated as of February 1, 1990, between Detroit Edison
and Renaissance (Exhibit 99-7 to Registration No. 33-50325).
99(e) -Second Amendment to 1988 Amended and Restated Loan
Agreement, dated as of September 1, 1993, between Detroit Edison
and Renaissance (Exhibit 99-8 to Registration No. 33-50325).
99(f) -$200,000,000 364-Day Credit Agreement, dated as of
September 1, 1993, among Detroit Edison, Renaissance and Barclays
Bank PLC, New York Branch, as Agent (Exhibit 99-12 to
Registration No. 33-50325).
99(g) -First Amendment, dated as of August 31, 1994, to
$200,000,000 364-Day Credit Agreement, dated September 1, 1993,
among The Detroit Edison Company, Renaissance Energy Company, the
Banks party thereto and Barclays Bank, PLC, New York Branch, as
Agent (Exhibit 99-19 to Form 10-Q for quarter ended September 30,
1994).
99(h) -Third Amendment, dated as of March 8, 1996, to
$200,000,000 364-Day Credit Agreement, dated September 1, 1993,
as amended, among Detroit Edison, Renaissance, the Banks party
thereto and Barclays Bank, PLC, New York Branch, as Agent
(Exhibit 99-11 to Form 10-Q for quarter ended March 31, 1996).
99(i) -Fourth Amendment, dated as of August 29, 1996, to
$200,000,000 364-Day Credit Agreement as of September 1, 1990, as
amended, among Detroit Edison, Renaissance, the Banks party
thereto and Barclays Bank, PLC, New York Branch, as Agent
(Exhibit 99-13 to Form 10-Q for quarter ended September 30,
1996).
99(j) -$200,000,000 Three-Year Credit Agreement, dated
September 1, 1993, among Detroit Edison, Renaissance and Barclays
Bank PLC, New York Branch, as Agent (Exhibit 99-13 to
Registration No. 33-50325).
99(k) -First Amendment, dated as of September 1, 1994, to
$200,000,000 Three-Year Credit Agreement, dated as of September
1, 1993, among The Detroit Edison Company, Renaissance Energy
Company, the Banks party thereto and Barclays Bank, PLC, New York
Branch, as
32
33
Exhibit
Number
-------
Agent (Exhibit 99-20 to Form 10-Q for quarter ended September
30, 1994).
99(l)- Third Amendment, dated as of March 8, 1996, to
$200,000,000 Three-Year Credit Agreement, dated September 1,
1993, as amended among Detroit Edison, Renaissance, the Banks
party thereto and Barclays Bank, PLC, New York Branch, as Agent
(Exhibit 99-12 to Form 10-Q for quarter ended March 31, 1996).
99(m)- Fourth Amendment, dated as of September 1, 1996, to
$200,000,000 Multi-Year (formerly Three-Year) Credit Agreement,
dated as of September 1, 1993, as amended among Detroit Edison,
Renaissance, the Banks party thereto and Barclays Bank, PLC, New
York Branch, as Agent (Exhibit 99-14 to Form 10-Q for quarter
ended September 30, 1996).
99(n) -1988 Amended and Restated Nuclear Fuel Heat Purchase
Contract, dated October 4, 1988, between Detroit Edison and
Renaissance (Exhibit 99-9 to Registration No. 33-50325).
99(o) -First Amendment to 1988 Amended and Restated Nuclear
Fuel Heat Purchase Contract, dated as of February 1, 1990,
between Detroit Edison and Renaissance (Exhibit 99-10 to
Registration No. 33-50325).
99(p) -Second Amendment, dated as of September 1, 1993, to
1988 Amended and Restated Nuclear Fuel Heat Purchase Contract
between Detroit Edison and Renaissance (Exhibit 99-11 to
Registration No. 33-50325).
99(q) -Third Amendment, dated as of August 31, 1994, to
1988 Amended and Restated Nuclear Fuel Heat Purchase Contract,
dated October 4, 1988, between The Detroit Edison Company and
Renaissance Energy Company (Exhibit 99-21 to Form 10-Q for
quarter ended September 30, 1994).
99(r) -Fourth Amendment, dated as of March 8, 1996, to 1988
Amended and Restated Nuclear Fuel Heat Purchase Contract
Agreement, dated as of October 4, 1988, between Detroit Edison
and Renaissance (Exhibit 99-10 to Form 10-Q for quarter ended
March 31, 1996).
99(s) -Credit Agreement, dated as of March 1, 1996 among
DTE Capital Corporation, the Initial Lenders named therein, and
Citibank, N.A., as Agent (Exhibit 99-9 to Form 10-Q for quarter
ended March 31, 1996).
33
34
(b) Registrants filed a report on Form 8-K dated March 13, 1997, discussing
the Detroit Edison Company's response to the MPSC Staff Report on
Electric Industry Restructuring.
(c) *Denotes management contract or compensatory plan or arrangement required
to be filed as an exhibit to this report.
34
35
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.
DTE ENERGY COMPANY
--------------------------
(Registrant)
Date May 1, 1997 /s/ SUSAN M. BEALE
-------------- ---------------------------
Susan M. Beale
Vice President and Corporate Secretary
Date May 1, 1997 /s/ DAVID E. MEADOR
-------------- ---------------------------
David E. Meador
Vice President and Controller
35
36
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.
THE DETROIT EDISON COMPANY
--------------------------
(Registrant)
Date May 1, 1997 /s/ SUSAN M. BEALE
-------------- ---------------------------
Susan M. Beale
Vice President and Corporate Secretary
Date May 1, 1997 /s/ DAVID E. MEADOR
-------------- ---------------------------
David E. Meador
Vice President and Controller
36
37
QUARTERLY REPORT ON FORM
10-Q FOR THE QUARTER
ENDED MARCH 31, 1997
DTE ENERGY COMPANY FILE NO. 1-11607
THE DETROIT EDISON COMPANY FILE NO. 1-2198
EXHIBIT INDEX
-------------
Exhibits filed herewith.
Exhibit Page
Number Number
------- ------
*10-6 - Detroit Edison Executive Incentive Plan.
*10-7 - 1997 Detroit Edison Executive Incentive Plan Measures.
11-7 - DTE Energy Company and Subsidiary Companies Primary
and Fully Diluted Earnings Per Share of Common Stock.
15-4 - Awareness Letter of Deloitte & Touche LLP regarding
their report dated May 1, 1997.
27-11 - Financial Data Schedule for the period ended March
31, 1997 for DTE Energy Company and Subsidiary Companies.
27-12 - Financial Data Schedule for the period ended March
31, 1997 for The Detroit Edison Company and Subsidiary
Companies.
Exhibits incorporated herein by reference. See Page Nos.
____ through
____ for location
of exhibits
incorporated by
reference
3(a) - Restated Articles of Incorporation of Detroit Edison,
as filed December 10, 1991 with the State of Michigan,
Department of Commerce - Corporation and Securities Bureau.
38
Exhibit
Number
------
3(b) - Certificate containing resolution of the Detroit
Edison Board of Directors establishing the Cumulative
Preferred Stock, 7.75% Series as filed February 22, 1993
with the State of Michigan, Department of Commerce -
Corporation and Securities Bureau.
3(c) - Certificate containing resolution of the Detroit
Edison Board of Directors establishing the Cumulative
Preferred Stock, 7.74% Series, as filed April 21, 1993 with
the State of Michigan, Department of Commerce - Corporation
and Securities Bureau.
3(d) - Amended and Restated Articles of Incorporation of DTE
Energy Company, dated December 13, 1995.
3(e) - Agreement and Plan of Exchange.
3(f) - Amended and Restated By-Laws, dated as of February
26, 1996, of the Company.
3(g) - Amended and Restated By-Laws, dated as of February
26, 1996, of Detroit Edison.
4(a) - Mortgage and Deed of Trust, dated as of October 1,
1924, between Detroit Edison and Bankers Trust Company as
Trustee and indentures supplemental thereto, dated as of
dates indicated below:
September 1, 1947
October 1, 1968
November 15, 1971
January 15, 1973
June 1, 1978
June 30, 1982
August 15, 1982
October 15, 1985
November 30, 1987
July 15, 1989
December 1, 1989
February 15, 1990
April 1, 1991
May 1, 1991
May 15, 1991
September 1, 1991
November 1, 1991
January 15, 1992
February 29, 1992
April 15, 1992
39
Exhibit
Number
-------
July 31, 1992
November 30, 1992
January 1, 1993
March 1, 1993
March 15, 1993
April 1, 1993
April 26, 1993
May 31, 1993
June 30, 1993
June 30, 1993
September 15, 1993
March 1, 1994
June 15, 1994
August 15, 1994
December 1, 1994
August 1, 1995
4(b) - Collateral Trust Indenture (notes), dated as of June 30, 1993.
4(c) - First Supplemental Note Indenture, dated as of June 30, 1993.
4(d) - Second Supplemental Note Indenture, dated as of
September 15, 1993.
4(e) - First Amendment, dated as of August 15, 1996, to
Second Supplemental Note Indenture.
4(f) - Third Supplemental Note Indenture, dated as of August
15, 1994.
4(g) - First Amendment, dated as of December 12, 1995, to
Third Supplemental Note Indenture, dated as of August 15,
1994.
4(h) - Fourth Supplemental Note Indenture, dated as of August 15,
1995.
4(i) - Fifth Supplemental Note Indenture, dated as of February 1,
1996.
4(j) - Standby Note Purchase Credit Facility, dated as of August 17,
1994, among The Detroit Edison Company, Barclays Bank PLC,
as Bank and Administrative Agent, Bank of America, The Bank
of New York, The Fuji Bank Limited, The Long-Term Credit Bank
of Japan, LTD, Union Bank and Citicorp Securities, Inc. and
First Chicago Capital Markets, Inc. as Remarketing Agents.
4(k) - Support Agreement, dated as of March 8, 1996, between
the Company and Detroit Edison.
40
Exhibit
Number
-------
99(a) - Belle River Participation Agreement between Detroit
Edison and Michigan Public Power Agency, dated as of December
1, 1982.
99(b) - Belle River Transmission Ownership and Operating Agreement
between Detroit Edison and Michigan Public Power Agency,
dated as of December 1, 1982.
99(c) - 1988 Amended and Restated Loan Agreement, dated as of October
4, 1988, between Renaissance Energy Company (an unaffiliated
company) and Detroit Edison.
99(d) - First Amendment to 1988 Amended and Restated Loan Agreement,
dated as of February 1, 1990, between Detroit Edison and
Renaissance.
99(e) - Second Amendment to 1988 Amended and Restated Loan Agreement,
dated as of September 1, 1993, between Detroit Edison and
Renaissance.
99(f) - $200,000,000 364-Day Credit Agreement, dated as of September
1, 1993, among Detroit Edison, Renaissance and Barclays Bank
PLC, New York Branch, as Agent.
99(g) - First Amendment, dated as of August 31, 1994, to $200,000,000
364-Day Credit Agreement, dated September 1, 1993, among The
Detroit Edison Company, Renaissance Energy Company, the
Banks party thereto and Barclays Bank, PLC, New York Branch,
as Agent.
99(h) - Third Amendment, dated as of March 8, 1996, to $200,000,000
364-Day Credit Agreement, dated September 1, 1993, as
amended, among Detroit Edison, Renaissance, the Banks party
thereto and Barclays Bank, PLC, New York Branch, as Agent .
99(i) - Fourth Amendment, dated as of August 29, 1996, to
$200,000,000 364-Day Credit Agreement as of September 1,
1990, as amended, among Detroit Edison, Renaissance, the
Banks party thereto and Barclays Bank, PLC, New York Branch,
as Agent.
99(j) - $200,000,000 Three-Year Credit Agreement, dated September 1,
1993, among Detroit Edison, Renaissance and Barclays Bank
PLC, New York Branch, as Agent.
99(k) - First Amendment, dated as of September 1, 1994, to
$200,000,000 Three-Year Credit Agreement, dated as of
September 1, 1993, among The Detroit Edison Company,
Renaissance Energy Company, the Banks party thereto and
Barclays Bank, PLC, New York Branch, as Agent.
41
Exhibit
Number
-------
99(l) - Third Amendment, dated as of March 8, 1996, to
$200,000,000 Three-Year Credit Agreement, dated September 1,
1993, as amended among Detroit Edison, Renaissance, the Banks
party thereto and Barclays Bank, PLC, New York Branch, as
Agent.
99(m) - Fourth Amendment, dated as of September 1, 1996, to
$200,000,000 Multi-Year (formerly Three-Year) Credit
Agreement, dated as of September 1, 1993, as amended among
Detroit Edison, Renaissance, the Banks party thereto and
Barclays Bank, PLC, New York Branch, as Agent.
99(n) - 1988 Amended and Restated Nuclear Fuel Heat Purchase
Contract, dated October 4, 1988, between Detroit Edison and
Renaissance.
99(o) - First Amendment to 1988 Amended and Restated Nuclear
Fuel Heat Purchase Contract, dated as of February 1, 1990,
between Detroit Edison and Renaissance.
99(p) - Second Amendment, dated as of September 1, 1993, to 1988
Amended and Restated Nuclear Fuel Heat Purchase Contract
between Detroit Edison and Renaissance.
99(q) - Third Amendment, dated as of August 31, 1994, to 1988 Amended
and Restated Nuclear Fuel Heat Purchase Contract, dated
October 4, 1988, between The Detroit Edison Company and
Renaissance Energy Company.
99(r) - Fourth Amendment, dated as of March 8, 1996, to 1988 Amended
and Restated Nuclear Fuel Heat Purchase Contract Agreement,
dated as of October 4, 1988, between Detroit Edison and
Renaissance.
99(s) - Credit Agreement, dated as of March 1, 1996 among DTE Capital
Corporation, the Initial Lenders named therein, and Citibank,
N.A., as Agent.
*Denotes management contract or compensatory plan or arrangement required
to be filed as an exhibit to this report.