1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED MARCH 31, 1999
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from to
--------- --------
Exact name of Registrant as specified in I.R.S. Employer
Commission its charter, state of incorporation, address Identification
File No. of principal executive offices, telephone Number
------------ -------------------------------------------- ---------------
1-8349 FLORIDA PROGRESS CORPORATION 59-2147112
A Florida Corporation
One Progress Plaza
St. Petersburg, Florida 33701
Telephone (727) 824-6400
1-3274 FLORIDA POWER CORPORATION 59-0247770
A Florida Corporation
One Progress Plaza
St. Petersburg, Florida 33701
Telephone (727) 820-5151
Indicate by check mark whether each registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes [X] No [ ]
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
Description of Shares Outstanding
Registrant Class at March 31, 1999
---------- -------------- ---------------------
Florida Progress Corporation Common Stock,
without par value 97,855,797
Florida Power Corporation Common Stock,
without par value 100 (all of which
were held by Florida
Progress Corporation)
This combined Form 10-Q represents separate filings by Florida Progress
Corporation and Florida Power Corporation. Florida Power makes no
representations as to the information relating to Florida Progress' diversified
operations.
2
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
FLORIDA PROGRESS CORPORATION
CONSOLIDATED FINANCIAL STATEMENTS
FLORIDA PROGRESS CORPORATION
CONSOLIDATED STATEMENTS OF INCOME
(In millions, except per share amounts)
Three Months Ended
March 31,
1999 1998
------ ------
(Unaudited)
REVENUES:
Electric utility $570.7 $565.2
Diversified 249.7 222.3
------ ------
820.4 787.5
------ ------
EXPENSES:
Electric utility:
Fuel 113.7 109.2
Purchased power 90.3 99.0
Energy conservation cost 17.1 16.6
Operations and maintenance 97.1 102.4
Extended nuclear outage - replacement
power costs -- 5.1
Depreciation and amortization 80.8 81.0
Taxes other than income taxes 51.9 49.5
------ ------
450.9 462.8
------ ------
Diversified:
Cost of sales 225.1 193.8
Other 14.6 12.7
------ ------
239.7 206.5
------ ------
INCOME FROM OPERATIONS 129.8 118.2
------ ------
INTEREST EXPENSE AND OTHER:
Interest expense 45.0 47.3
Allowance for funds used during construction (5.1) (3.9)
Other expense (income), net (4.3) --
------ ------
35.6 43.4
------ ------
INCOME FROM CONTINUING OPERATIONS
BEFORE INCOME TAXES 94.2 74.8
Income Taxes 26.6 24.3
------ ------
NET INCOME $ 67.6 $ 50.5
====== ======
AVERAGE SHARES OF COMMON STOCK OUTSTANDING 97.5 97.1
====== ======
EARNINGS PER AVERAGE COMMON SHARE
(Basic and Diluted) $ .69 $ .52
====== ======
DIVIDENDS PER COMMON SHARE $ .545 $ .535
====== ======
The accompanying notes are an integral part of these consolidated financial
statements.
2
3
FLORIDA PROGRESS CORPORATION
CONSOLIDATED BALANCE SHEETS
(In millions)
March 31, December 31,
1999 1998
----------- ------------
(Unaudited)
ASSETS:
PROPERTY, PLANT AND EQUIPMENT:
Electric utility plant in service and $6,302.6 $6,307.8
held for future use
Less - Accumulated depreciation 2,765.4 2,716.0
Accumulated decommissioning for
nuclear plant 262.5 254.8
Accumulated dismantlement for
fossil plants 131.2 130.7
-------- --------
3,143.5 3,206.3
Construction work in progress 424.4 378.3
Nuclear fuel, net of amortization of
$381.5 in 1999 and $377.2 in 1998 41.6 45.9
-------- --------
Net electric utility property 3,609.5 3,630.5
Other property, net of depreciation of
$244.8 in 1999 and $234.6 in 1998 589.3 560.1
-------- --------
4,198.8 4,190.6
-------- --------
CURRENT ASSETS:
Cash and equivalents 1.7 2.5
Accounts receivable, net 406.8 413.4
Inventories at average cost:
Fuel 90.6 69.8
Utility materials and supplies 87.1 83.3
Diversified operations 145.9 137.0
Deferred income taxes 55.3 55.9
Prepayments and other 72.4 92.2
-------- --------
859.8 854.1
-------- --------
DEFERRED CHARGES AND OTHER ASSETS:
Costs deferred pursuant to regulation:
Deferred purchased power contract
termination costs 318.8 321.0
Other 106.7 113.6
Investments in nuclear decommissioning
fund 336.3 332.1
Goodwill 144.4 139.8
Joint ventures and partnerships 66.3 71.5
Other 144.4 138.1
-------- --------
1,116.9 1,116.1
-------- --------
$6,175.5 $6,160.8
======== ========
Note: The accompanying notes are an integral part of these consolidated
financial statements.
3
4
FLORIDA PROGRESS CORPORATION
CONSOLIDATED BALANCE SHEETS
(In millions)
March 31, December 31,
1999 1998
----------- ----------
(Unaudited)
CAPITAL AND LIABILITIES:
COMMON STOCK EQUITY:
Common stock $1,242.1 $1,221.1
Retained earnings 655.2 640.9
-------- --------
1,897.3 1,862.0
CUMULATIVE PREFERRED STOCK OF FLORIDA POWER:
Without sinking funds 33.5 33.5
LONG-TERM DEBT 2,300.4 2,250.4
-------- --------
TOTAL CAPITAL 4,231.2 4,145.9
-------- --------
CURRENT LIABILITIES:
Accounts payable 203.5 297.9
Customers' deposits 105.5 104.1
Accrued other taxes 30.9 10.1
Accrued interest 54.3 70.4
Overrecovered utility fuel cost 35.5 22.2
Other 71.3 85.8
-------- --------
501.0 590.5
Notes payable 310.8 236.2
Current portion of long-term debt 94.5 145.9
-------- --------
906.3 972.6
-------- --------
DEFERRED CREDITS AND OTHER LIABILITIES:
Deferred income taxes 595.9 595.4
Unamortized investment tax credits 75.8 77.8
Other postemployment benefit costs 118.5 116.1
Other 247.8 253.0
-------- --------
1,038.0 1,042.3
-------- --------
$6,175.5 $6,160.8
======== ========
Note: The accompanying notes are an integral part of these consolidated
financial statements.
4
5
FLORIDA PROGRESS CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In millions)
Three Months Ended
March 31,
1999 1998
------ ------
(Unaudited)
OPERATING ACTIVITIES:
Income from continuing operations $ 67.6 $ 50.5
Adjustments for noncash items:
Depreciation and amortization 100.5 100.9
Deferred income taxes and
investment tax credits, net (6.4) (7.3)
Changes in working capital, net of effects
from acquisition or sale of businesses:
Accounts receivable 6.9 10.2
Inventories (32.8) 3.1
Underrecovered/(overrecovered) utility
fuel cost 13.3 (8.3)
Accounts payable (94.7) (33.0)
Income taxes payable 30.7 29.9
Accrued other taxes 20.8 20.5
Other (40.4) (11.8)
Other operating activities 9.2 (1.1)
------- -------
74.7 153.6
------- -------
INVESTING ACTIVITIES:
Property additions (including allowance for
borrowed funds used during construction) (100.7) (103.0)
Acquisitions of businesses (10.1) (9.1)
Other investing activities (1.7) (11.3)
------- -------
(112.5) (123.4)
------- -------
FINANCING ACTIVITIES:
Issuance of long-term debt 50.0 144.1
Repayment of long-term debt (51.9) (169.4)
Sale of common stock 18.1 --
Dividends paid on common stock (53.3) (51.9)
Increase in short-term debt 74.6 52.7
Other financing activities (.5) (.6)
------- -------
37.0 (25.1)
------- -------
NET INCREASE (DECREASE) IN CASH AND EQUIVALENTS (.8) 5.1
Beginning cash and equivalents 2.5 3.1
------- -------
ENDING CASH AND EQUIVALENTS $ 1.7 $ 8.2
======= =======
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid during the period for:
Interest (net of amount capitalized) $ 57.4 $ 52.7
Income taxes (net of refunds) $ 7.3 $ 2.3
The accompanying notes are an integral part of these consolidated financial
statements.
5
6
FLORIDA PROGRESS CORPORATION
STATEMENTS OF COMMON EQUITY AND COMPREHENSIVE INCOME
For the periods ended March 31, 1999 and 1998
(Dollars in millions)
Common Retained
Total Stock Earnings
-------- -------- --------
Balance, December 31, 1997 $1,776.0 $1,209.0 $567.0
Net income 50.5 50.5
-------- -------- ------
50.5 -- 50.5
Common stock redeemed (.7) (.7)
Cash dividends on common
stock (51.9) (51.9)
-------- -------- ------
Balance, March 31, 1998 $1,773.9 $1,208.3 $565.6
======== ======== ======
Balance, December 31, 1998 $1,862.0 $1,221.1 $640.9
Net income 67.6 67.6
-------- -------- ------
67.6 -- 67.6
Common stock issued 21.0 21.0
Cash dividends on common
stock (53.3) (53.3)
-------- -------- ------
Balance, March 31, 1999 $1,897.3 $1,242.1 $655.2
======== ======== ======
The accompanying notes are an integral part of these consolidated financial
statements.
6
7
FLORIDA POWER CORPORATION
FINANCIAL STATEMENTS
FLORIDA POWER CORPORATION
STATEMENTS OF INCOME
(In millions)
Three Months Ended
March 31,
1999 1998
---- ----
(Unaudited)
OPERATING REVENUES:
Residential $298.7 $308.7
Commercial 131.4 123.7
Industrial 49.3 47.8
Sales for resale 48.8 36.9
Other 42.5 48.1
------ ------
570.7 565.2
------ ------
OPERATING EXPENSES:
Operation:
Fuel 113.7 109.2
Purchased power 90.3 99.0
Energy conservation cost 17.1 16.6
Operations and maintenance 97.1 102.4
Extended nuclear outage - replacement
power costs -- 5.1
Depreciation and amortization 80.8 81.0
Taxes other than income taxes 51.9 49.5
------ ------
450.9 462.8
------ ------
Income taxes:
Currently payable 40.7 32.5
Deferred, net (6.0) (6.3)
Investment tax credits, net (2.0) (2.0)
------ ------
32.7 24.2
------ ------
483.6 487.0
------ ------
OPERATING INCOME 87.1 78.2
------ ------
OTHER INCOME AND DEDUCTIONS:
Allowance for equity funds used
during construction 2.3 2.2
Miscellaneous other income, net 2.0 --
------ ------
4.3 2.2
------ ------
INTEREST CHARGES
Interest on long-term debt 26.9 30.6
Other interest expense 4.5 5.3
------ ------
31.4 35.9
Allowance for borrowed funds used
during construction (2.8) (1.7)
------ ------
28.6 34.2
------ ------
NET INCOME 62.8 46.2
DIVIDENDS ON PREFERRED STOCK .4 .4
------ ------
NET INCOME AFTER DIVIDENDS
ON PREFERRED STOCK $ 62.4 $ 45.8
====== ======
The accompanying notes are an integral part of these financial statements.
7
8
FLORIDA POWER CORPORATION
BALANCE SHEETS
(In millions)
March 31, December 31,
1999 1998
--------- ------------
(Unaudited)
ASSETS
PROPERTY, PLANT AND EQUIPMENT:
Electric utility plant in service and held $6,302.6 $6,307.8
for future use
Less - Accumulated depreciation 2,765.4 2,716.0
Accumulated decommissioning for
nuclear plant 262.5 254.8
Accumulated dismantlement for
fossil plants 131.2 130.7
-------- --------
3,143.5 3,206.3
Construction work in progress 424.4 378.3
Nuclear fuel, net of amortization of
$381.5 in 1999 and $377.2 in 1998 41.6 45.9
-------- --------
3,609.5 3,630.5
Other property, net 10.9 11.5
-------- --------
3,620.4 3,642.0
-------- --------
CURRENT ASSETS:
Accounts receivable, less reserve of $3.8
in 1999 and 1998 192.3 206.0
Inventories at average cost:
Fuel 64.9 48.4
Materials and supplies 87.1 83.3
Deferred income taxes 55.3 56.0
Prepayments and other 54.4 69.5
-------- --------
454.0 463.2
-------- --------
OTHER ASSETS:
Costs deferred pursuant to regulation:
Deferred purchased power contract
termination costs 318.8 321.0
Other 106.7 113.6
Investments in nuclear decommissioning
fund 336.3 332.1
Other 53.5 56.2
-------- --------
815.3 822.9
-------- --------
$4,889.7 $4,928.1
======== ========
The accompanying notes are an integral part of these financial statements.
8
9
FLORIDA POWER CORPORATION
BALANCE SHEETS
(In millions)
March 31, December 31,
1999 1998
----------- ------------
(Unaudited)
CAPITALIZATION AND LIABILITIES
CAPITALIZATION:
Common stock $1,004.4 $1,004.4
Retained earnings 828.2 815.7
-------- --------
1,832.6 1,820.1
CUMULATIVE PREFERRED STOCK:
Without sinking funds 33.5 33.5
LONG-TERM DEBT 1,555.2 1,555.1
-------- --------
TOTAL CAPITAL 3,421.3 3,408.7
-------- --------
CURRENT LIABILITIES:
Accounts payable 124.4 173.0
Accounts payable to associated companies 24.5 27.2
Customers' deposits 105.5 104.1
Accrued other taxes 26.7 6.3
Accrued interest 47.6 55.8
Overrecovered utility fuel cost 35.5 22.2
Other 58.5 51.8
-------- --------
422.7 440.4
Notes payable 17.7 47.3
Current portion of long-term debt 91.6 91.6
-------- --------
532.0 579.3
-------- --------
DEFERRED CREDITS AND OTHER LIABILITIES:
Deferred income taxes 561.8 563.2
Unamortized investment tax credits 75.3 77.2
Other postemployment benefit costs 115.1 112.9
Other 184.2 186.8
-------- --------
936.4 940.1
-------- --------
$4,889.7 $4,928.1
======== ========
The accompanying notes are an integral part of these financial statements.
9
10
FLORIDA POWER CORPORATION
STATEMENTS OF CASH FLOWS
(In millions)
Three Months Ended
March 31,
1999 1998
---- ----
(Unaudited)
OPERATING ACTIVITIES:
Net income after dividends on preferred stock $ 62.4 $ 45.8
Adjustments for noncash items:
Depreciation and amortization 86.6 91.6
Deferred income taxes and
investment tax credits, net (8.3) (8.3)
Changes in working capital:
Accounts receivable 13.6 22.4
Inventories (20.3) (2.3)
Overrecovered/(Underrecovered) utility
fuel cost 13.3 (8.3)
Accounts payable (48.6) (52.5)
Accounts payable to associated companies (2.7) (3.6)
Income taxes payable 39.8 29.2
Accrued other taxes 20.4 21.4
Other (24.7) (5.2)
Other operating activities 12.2 (.2)
------ -------
143.7 130.0
------ -------
INVESTING ACTIVITIES:
Construction expenditures (57.6) (65.5)
Allowance for borrowed funds used during
construction (2.8) (1.7)
Other investing activities (3.8) (4.6)
------ -------
(64.2) (71.8)
------ -------
FINANCING ACTIVITIES:
Issuance of long-term debt -- 144.1
Repayment of long-term debt -- (157.8)
Dividends paid on common stock (49.9) (49.0)
Increase (decrease) in short-term debt (29.6) 10.1
------ -------
(79.5) (52.6)
------ -------
NET INCREASE IN CASH AND EQUIVALENTS -- 5.6
Beginning cash and equivalents -- --
------ -------
ENDING CASH AND EQUIVALENTS $ -- $ 5.6
====== =======
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid during the period for:
Interest (net of amount capitalized) $ 35.9 $ 36.3
Income taxes (net of refunds) $ 5.9 $ 3.6
The accompanying notes are an integral part of these financial statements.
10
11
FLORIDA PROGRESS CORPORATION AND FLORIDA POWER CORPORATION
NOTES TO FINANCIAL STATEMENTS
1) Florida Progress' principal business segment is Florida Power, an electric
utility engaged in the generation, purchase, transmission, distribution and
sale of electricity. The other reportable business segments are Electric
Fuels' Energy and Related Services, Rail Services and Inland Marine
Transportation units. Energy and Related Services includes coal operations,
river terminal services and off-shore marine transportation. Rail Services'
operations include railcar repair, rail parts reconditioning and sales,
railcar leasing and sales, providing rail and track material, and metal
recycling. Inland Marine provides transportation of coal, agricultural and
other dry-bulk commodities as well as fleet management services. The
"Other" category in the following table includes the parent holding
company, Florida Progress Corporation, which allocates a portion of its
operating expenses to business segments. This category also includes
segments below the quantitative threshold required for separate disclosure.
Florida Progress' significant operations are geographically located in the
United States. Financial data for business segments for the periods covered
in this Form 10-Q are presented in the table below:
Energy and Rail Inland Marine
(In millions) Utility Related Services Services Transportation Other Elimination Consolidated
- ---------------------------------- ------- ---------------- -------- -------------- ----- ----------- ------------
Three months ended March 31, 1999:
Revenues $ 570.7 $ 42.8 $174.0 $ 30.2 $ 1.5 $ 1.2 $ 820.4
Intersegment revenues -- 65.8 .4 4.0 (4.6) (65.6) --
Segment net income (loss) 62.4 8.1 .5 .7 (4.1) -- 67.6
Total assets 4,889.7 332.3 712.9 109.2 175.3 (43.9) 6,175.5
Three months ended March 31, 1998:
Revenues $ 565.2 $ 46.3 $147.2 $ 28.0 $ (.3) $ 1.1 $ 787.5
Intersegment revenues -- 70.1 .1 3.1 (3.4) (69.9) --
Segment net income (loss) 45.8 5.1 2.1 1.7 (4.2) -- 50.5
Total assets 4,922.8 291.1 419.7 159.3 57.5 (14.0) 5,836.4
2) CONTINGENCIES
OFF-BALANCE SHEET RISK - Several of Florida Progress' subsidiaries are
general partners in unconsolidated partnerships and joint ventures. Florida
Progress or its subsidiaries have agreed to support certain loan agreements
of the partnerships and joint ventures. These credit risks are not material
to the financial statements and Florida Progress considers these credit
risks to be minimal, based upon the asset values supporting the partnership
liabilities.
INSURANCE - Florida Progress and its subsidiaries utilize various risk
management techniques to protect assets from risk of loss, including the
purchase of insurance. Risk avoidance, risk transfer and self-insurance
techniques are utilized depending on Florida Progress' ability to assume
risk, the relative cost and availability of methods for transferring risk
to third parties, and the requirements of applicable regulatory bodies.
Florida Power self-insures its transmission and distribution lines against
loss due to storm damage and other natural disasters. Pursuant to a
regulatory order, Florida Power is accruing $6 million annually to a storm
damage reserve and may
11
12
defer any losses in excess of the reserve. The reserve balances at March
31, 1999 and December 31, 1998 were $25.6 million and $24.1 million,
respectively.
Under the provisions of the Price Anderson Act, which limits liability for
accidents at nuclear power plants, Florida Power, as an owner of a nuclear
plant, can be assessed for a portion of any third-party liability claims
arising from an accident at any commercial nuclear power plant in the
United States. If total third-party claims relating to a single nuclear
incident exceed $200 million (the amount of currently available commercial
liability insurance), Florida Power could be assessed up to $88.1 million
per incident, with a maximum assessment of $10 million per year.
Florida Power is a member of the Nuclear Electric Insurance, Ltd. ("NEIL"),
an industry mutual insurer, which provides business interruption and extra
expense coverage in the event of a major accidental outage at a covered
nuclear power plant. Florida Power is subject to a retroactive premium
assessment by NEIL under this policy in the event loss experience exceeds
NEIL's available surplus. Florida Power's present maximum share of any such
retroactive assessment is $2.7 million per policy year.
Florida Power also maintains nuclear property damage insurance and
decontamination and decommissioning liability insurance totaling $2.1
billion. The first layer of $500 million is purchased in the commercial
insurance market with the remaining excess coverage purchased from NEIL.
Florida Power is self-insured for any losses that are in excess of this
coverage. Under the terms of the NEIL policy, Florida Power could be
assessed up to a maximum of $9.5 million in any policy year if losses in
excess of NEIL's available surplus are incurred.
Florida Power has never been assessed under these nuclear indemnities or
insurance policies.
CONTAMINATED SITE CLEANUP - Florida Progress is subject to regulation with
respect to the environmental impact of its operations. Florida Progress'
disposal of hazardous waste through third-party vendors can result in costs
to clean up facilities found to be contaminated. Federal and state statutes
authorize governmental agencies to compel responsible parties to pay for
cleanup of these hazardous waste sites.
Florida Power and certain former subsidiaries of Florida Progress, whose
properties were sold in prior years, have been identified by the U.S.
Environmental Protection Agency ("EPA") as Potentially Responsible Parties
("PRPs") at certain sites. Liability for the cleanup costs at these sites
is joint and several.
One of the sites that Florida Power previously owned and operated is
located at Sanford, Florida. There are five parties, including Florida
Power, that have been identified as PRPs at the Sanford site. An agreement
has been reached among the PRPs of the Sanford site to spend up to $1.5
million to perform a Risk Investigation and Feasibility Study ("RI/FS").
Florida Power is liable for 39.7% of those costs. On September 25, 1998,
the EPA formally approved the PRP RI/FS Work Plan. The RI/FS field work was
completed in January 1999. The EPA is expected to review the final
Treatability Study report and provide further guidance to the PRPs by
August 1999.
The discussions and resolution of liability for cleanup costs could cause
Florida Power to increase the estimate of its liability for those costs.
Although estimates of any additional costs are not currently available, the
outcome is not expected to have a material effect on Florida Progress'
financial position, results of operations or liquidity.
In December 1998, Florida Power allowed the EPA to conduct an expanded site
inspection at a former plant site designated "Inglis". Soil and groundwater
samples were obtained from the Florida Power property, as well as sediment
12
13
samples from the adjacent Withalacoochee River. A final report is expected
from the EPA in 1999 regarding the site hazard ranking and possible listing
on the National Priorities list.
In addition to these designated sites, there are other sites where Florida
Progress or its present or former subsidiaries may be responsible for
additional environmental cleanup. Florida Progress' best estimates indicate
that its share of liability for cleaning up all designated sites ranges
from $2.5 million to $7.5 million. It has accrued $4.4 million against
these potential costs.
AGE DISCRIMINATION SUIT - Florida Power and Florida Progress have been
named defendants in an age discrimination lawsuit. The number of plaintiffs
remains at 116, but four of those plaintiffs have had their federal claims
dismissed and five others have had their state age claims dismissed. While
no dollar amount was requested, each plaintiff seeks back pay,
reinstatement or front pay through their projected dates of normal
retirement, costs and attorneys' fees. In October 1996, the court approved
an agreement between the parties to provisionally certify this case as a
class action suit under the Age Discrimination in Employment Act. Florida
Power has filed a motion to decertify the class, but a hearing date has not
yet been set. In December 1998, plaintiffs alleged damages of $100 million.
Company management, while not believing plaintiffs' claim to have merit,
offered $5 million in an attempted settlement of all claims. Plaintiffs
rejected that offer. Subsequently, Florida Power and the plaintiffs engaged
in informal settlement discussions, which were terminated on December 22,
1998. However, plaintiffs have filed a motion to enforce a purported $11
million oral settlement agreement. Florida Power denies that such an
agreement exists and has filed responsive pleadings to that effect. As a
result, management has identified a probable range of $5 million to $100
million with no amount within that range a better estimate of probable loss
than any other amount; accordingly, Florida Power has accrued $5 million.
There can be no assurance that this litigation will be settled, or if
settled, that the settlement will not exceed $5 million. Additionally, the
ultimate outcome, if litigated, cannot presently be determined.
ADVANCED SEPARATION TECHNOLOGIES, INC. ("AST") - In 1996, Florida Progress
sold its 80% interest in AST to Calgon Carbon Corporation ("Calgon") for
net proceeds of $56 million in cash. Calgon filed a lawsuit in January
1998, and amended it in April 1998, alleging misstatement of AST's 1996
revenues, assets and liabilities, seeking damages and granting Calgon the
right to rescind the sale. The lawsuit also accused Florida Progress of
failing to disclose flaws in AST's manufacturing process and a lack of
quality control. No projection of an outcome or estimate of a potential
liability, if any, can be determined at the date of issuance of these
financial statements. Florida Progress believes the lawsuit is without
merit and intends to vigorously defend itself. Accordingly, Florida
Progress has not made provision for any loss for this matter.
QUALIFYING FACILITIES CONTRACTS - Florida Power's purchased power contracts
with qualifying facilities employ separate pricing methodologies for
capacity payments and energy payments. Florida Power has interpreted the
pricing provision in these contracts to allow it to pay an as-available
energy price rather than a higher firm energy price when the avoided unit
upon which the applicable contract is based would not have been operated.
The owners of four qualifying facilities filed suit against Florida Power
in state court over the contract payment terms, and one also filed in
federal court. Two of the suits have been settled, and the federal case was
dismissed, although the plaintiff has appealed. Of the two remaining suits,
the trial regarding NCP Lake Power ("Lake") concluded in December 1998. In
April 1999, the judge entered a non-final trial order. The judge granted
Lake's breach of contract claim and ruled that Lake is entitled to receive
"firm" energy payments during on-peak hours, but for all other hours, Lake
is entitled to the "as-available" rate. A final order will be entered after
the amount of damages due Lake is determined. The other remaining suit has
not yet been set for trial.
13
14
Management does not expect that the results of these legal actions will
have a material impact on Florida Power's financial position, operations or
liquidity. Florida Power anticipates that all fuel and capacity expenses
will be recovered from its customers.
MID-CONTINENT LIFE INSURANCE COMPANY ("MID-CONTINENT") - As discussed
below, a series of events in 1997 significantly jeopardized the ability of
Mid-Continent to implement a plan to eliminate a projected reserve
deficiency, resulting in the impairment of Florida Progress' investment in
Mid-Continent. Therefore, Florida Progress recorded a provision for loss on
investment of $86.9 million in 1997. In addition, tax benefits of
approximately $11 million related to the excess of the tax basis over the
book value in the investment in Mid-Continent as of December 31, 1997, were
not recorded because of uncertainties associated with the timing of a tax
deduction. Florida Progress also recorded an accrual at December 31, 1997,
for legal fees associated with defending its position in current
Mid-Continent legal proceedings.
In the spring of 1997, the Oklahoma State Insurance Commissioner
("Commissioner") received court approval to seize control of the operations
of Mid-Continent. The commissioner had alleged that Mid-Continent's
reserves were understated by more than $125 million, thus causing
Mid-Continent to be statutorily impaired. The Commissioner further alleged
that Mid-Continent had violated Oklahoma law relating to deceptive trade
practices in connection with the sale of its "Extra Life" insurance
policies and was not entitled to raise premiums, a key element to
Mid-Continent's plan to address the projected reserve deficiency. While
sustaining the receivership, the court also ruled that premiums could be
raised. Although both sides appealed the decision to the Oklahoma Supreme
Court, those appeals were withdrawn in early 1999.
In December 1997, the Commissioner filed a lawsuit against Florida
Progress, certain of its directors and officers, and certain former
Mid-Continent officers, making a number of allegations and seeking access
to Florida Progress' assets to satisfy policyholder and creditor claims. In
April 1998, the court granted motions to dismiss the individual defendants,
leaving Florida Progress as the sole remaining defendant in the lawsuit.
A new Commissioner was elected in November 1998 and has stated his
intention to work with Florida Progress and others to develop a plan to
rehabilitate Mid-Continent rather than pursue litigation against Florida
Progress. Based on data through December 31, 1998, Florida Progress'
estimate of the additional assets necessary to fund the reserve, after
applying Mid-Continent's statutory surplus, is in the range of $100
million, rather than in the $350 million range put forth by the actuary
hired by the former Commissioner. Florida Progress believes that any
estimate of the projected reserve deficiency would affect only the assets
of Mid-Continent, because Florida Progress has legal defenses to any claims
asserted against it. Florida Progress is working with the new Commissioner
to develop a viable plan to rehabilitate Mid-Continent, which would include
the sale of that company. An order agreed upon by both sides outlining a
plan of rehabilitation was filed on March 18, 1999. The evaluation of bids
should be completed by the end of June 1999.
In January 1999, five Mid-Continent policyholders filed a purported class
action against Mid-Continent and the same defendants named in the case
filed by the former Commissioner. The complaint contains substantially the
same factual allegations as those made by the Commissioner. The suit
asserts "Extra Life" policyholders have been injured as a result of
representations made in connection with the sale of that policy. The suit
seeks unspecified actual and punitive damages.
Although Florida Progress hopes to reach a negotiated resolution of these
matters, it would continue to vigorously defend itself against the two
lawsuits, should negotiations fail. Florida Progress believes the lawsuits
are without merit. Because neither the outcome of the litigation nor the
ultimate effects of any rehabilitation plan, including the possible sale of
Mid-Continent, can be estimated, Florida Progress has not made provision
for any additional losses that might result.
14
15
3) In the opinion of management, the accompanying financial statements include
all adjustments deemed necessary to summarize fairly and reflect the
financial position and results of operations of Florida Progress and
Florida Power for the interim periods presented. Results for the first
quarter are not necessarily indicative of results for the full year. It is
suggested that these financial statements be read in conjunction with the
financial statements and notes thereto in the combined Form 10-K of Florida
Progress and Florida Power for the year ended December 31, 1998 (the "1998
Form 10-K").
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
OPERATING RESULTS
Florida Progress' consolidated earnings for the three month period ended March
31, 1999, were $67.6 million compared to $50.5 million for the same period in
1998. Florida Progress' earnings per share for the quarter ended March 31,
1999, were $.69 compared to $.52 for the same period in 1998.
FLORIDA POWER CORPORATION
Florida Power, the largest subsidiary of Florida Progress, reported earnings of
$.64 per share for the first quarter of 1999, compared with $.47 per share for
the first quarter of 1998.
A reconciliation of Florida Power's 1999 first quarter earnings is as follows:
1998 FIRST QUARTER EPS $ 0.47
Customer & non-weather usage growth 0.13
Estimated weather impact on sales (0.06)
Operations & maintenance 0.04
1998 nuclear outage replacement fuel 0.03
Gain on sale of property 0.03
------
1999 FIRST QUARTER EPS $0.64
=====
UTILITY REVENUES AND SALES
Florida Power's operating revenues were $5.5 million, or 1.0 percent, higher
for the three month period ended March 31, 1999, compared to the same period in
1998 due to increased wholesale sales and higher usage from commercial
customers. Most of the increase in the wholesale sales was due to higher sales
in the short-term energy market and higher sales to Florida Power's largest
wholesale customer, Seminole Electric Cooperative, Inc. ("SECI"). Short-term
energy sales have a minimal impact on earnings because the net benefit of the
sales is credited to retail customers through the fuel cost recovery clause. In
January 1999, Florida Power began supplying additional power to SECI, under a
three-year contract.
OTHER UTILITY EXPENSES
Operations and maintenance expenses for the three months ended March 31, 1999,
decreased $5.3 million or 5.2 percent, compared with the same quarter last
year. Lower operations and maintenance costs resulted primarily from the timing
of certain generation plant maintenance costs.
DIVERSIFIED OPERATIONS
Revenues and Cost of sales for Florida Progress' diversified operations were
$27.4 million and $31.3 million higher for the three months ended March 31,
1999 compared to the same period last year. The increase was due primarily to
1998 acquisitions at Electric Fuels' Rail Services Group.
15
16
ELECTRIC FUELS CORPORATION
Electric Fuels earned $.09 per share in the first quarter of 1999, compared
with $.08 per share during the same period in 1998. The increase was due
primarily to improved operating results for the Energy and Related Services
group, which offset lower earnings at the Inland Marine Transportation and Rail
Services business units.
Earnings at the Energy and Related Services group for the three months ended
March 31, 1999 increased $3.0 million over the same period in 1998. The
improvement in Energy and Related Services was due largely to alternative fuel
tax credits, which are generated from the production and sale of a synthetic
fuel.
Earnings from the Inland Marine Transportation group decreased $1.0 million for
the first quarter of 1999 compared to the same period in 1998. For 1999,
prolonged icing conditions in January and high water conditions in February
disrupted barge operations and limited tow capacity.
Results in the Rail Services group decreased $1.6 million when compared to the
prior year due to several factors. Higher revenues from its recycling
operations were more than offset by lower margins which resulted from depressed
scrap steel prices during the first quarter of 1999 compared to 1998. Also
contributing to the lower results for the group was a temporary decrease in
track work orders, which can fluctuate as railroads reschedule the timing of
track repair work. Partially offsetting the lower results was a strong demand
for rail car parts throughout the quarter.
A new track work facility was opened in Texas in the first quarter of 1999. The
plant was built to meet the needs of the major railroads in that region.
Certain costs associated with the start-up of the new facility were expensed
during the quarter.
Management believes that the outlook for 1999 remains positive for the
diversified operations despite the temporary conditions discussed above. During
March, track work orders returned to expected levels and river conditions
returned to normal.
YEAR 2000
Florida Progress has taken a comprehensive five-step approach in addressing the
Y2K issue. The five steps include awareness, inventory assessment and
prioritization, remediation and verification and contingency planning. (See
1998 Form 10-K, Item 7, "Management's Discussion and Analysis of Financial
Condition and Results of Operations - Year 2000".)
The following chart represents an estimate of the current status of the Florida
Progress Year 2000 ("Y2K") progress and planned completion dates for each phase
as of March 31, 1999.
Florida Power Electric Fuels
Percent Planned Percent Planned
Complete Completion Complete Completion
March 31, 1999 Date March 31, 1999 Date
-------------- ---------- -------------- -----------
AWARENESS - * * * *
INVENTORY - 100% January 1999 100% March 1999
ASSESSMENT AND
PRIORITIZATION - 99% May 1999 67% June 1999
REMEDIATION AND
VERIFICATION - 79% June 1999 60% September 1999
CONTINGENCY
PLANNING - 40% September 1999 20% December 1999
* To continue through duration of project.
June 30, 1999 is the date that the North American Electric Reliability Council
("NERC") has designated for electric utilities to complete remediation and
verification for mission critical systems. Florida Power expects to meet NERC
requirements targeted for this date.
16
17
There have been several milestones in 1999. On April 9, 1999, NERC and the
Florida Reliability Coordinating Council ("FRCC") sponsored a successful drill
of backup communication capabilities within and between utilities. Customer
call centers have been tested for the ability to receive calls, provide
customer data and dispatch service work. These tests were successful. End to
end testing of the data communication network was completed.
Consultants have assisted Florida Progress in preparing fossil and nuclear
generation facilities for Y2K readiness, in addition to assisting with
contingency planning. Florida Progress continues to work with the Florida
Public Service Commission ("FPSC"), FRCC, neighboring utilities, third party
vendors and customers to ensure a smooth transition into the year 2000.
Nevertheless, achieving Y2K readiness is subject to various risks and
uncertainties, as explained in greater detail in the 1998 Form 10-K, under
Item 7, "Year 2000."
Florida Progress currently estimates that the total cost of addressing Y2K
issues is between $15 million and $25 million. No Florida Progress systems have
been replaced on an accelerated basis due to the Y2K issue. As of March 31,
1999, Florida Progress has incurred a total of approximately $8 million of
internal and external costs related to Y2K. The company does not track internal
and external costs separately. All costs have been expensed as incurred.
POWER GENERATION
HINES UNIT I CONSTRUCTION
On April 23, 1999, Florida Power placed into service a 500MW combined cycle
generation plant, located in Polk County, Florida. The plant will be included
in Florida Power's rate base, upon which Florida Power will be able to earn its
regulated return on equity. (See 1998 Form 10-K, Item 2, "Properties - Planned
Generation and Energy Sales".)
LIQUIDITY AND CAPITAL RESOURCES
Florida Progress' capital expenditures are expected to be approximately $495
million for 1999, excluding allowance for funds used during construction, of
which $340 million is designated for Florida Power and $155 million for
diversified operations. Florida Power's construction program is expected to be
funded from internally generated funds. Diversified capital expenditures will
be funded by internally generated funds, debt, and equity contributions. During
the first three months of 1999, $57.6 million was spent on the Florida Power
construction program and $43.1 million was spent in diversified operations. The
capital expenditures were financed primarily with funds from operations and
short-term debt.
Florida Power's ratio of earnings to fixed charges was 4.17 for the twelve
months ended March 31, 1999. (See Exhibit 12 filed herewith).
In 1998, Progress Capital Holdings Inc., a subsidiary of Florida Progress that
provides financing for Florida Progress' diversified operations, established
uncommitted bank bid facilities allowing it to borrow and re-borrow, and have
outstanding at any time, up to $300 million. At March 31, 1999, $225 million
was outstanding under these bid facilities. The funds were used for general
corporate purposes.
In April 1999, FPC Capital I, an affiliated business trust, completed the sale
of $300 million Cumulative Quarterly Income Preferred Securities, which were
initially offered to the public at $25 per share. The securities are fully and
unconditionally guaranteed by Florida Progress. Quarterly distributions will be
payable at an annual rate of 7.10%. Florida Progress used net proceeds to repay
a portion of the outstanding short-term bank loans and commercial paper and for
other general corporate purposes.
17
18
In November 1998, the Progress Plus Stock Plan and Employee Savings Plan (the
Plans) began issuing new shares of common stock instead of purchasing shares in
the open market. Florida Progress received approximately $18.1 million of new
equity through this program in the first quarter of 1999.
Florida Progress and Florida Power believe their available sources of liquidity
will be sufficient to fund their long-term and short-term capital requirements.
"SAFE HARBOR" STATEMENT UNDER
THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995
This report contains certain forward looking statements, including projections
regarding the liability for cleaning up certain environmental sites; the
results of certain legal proceedings relating to Mid-Continent; and the costs
associated with modifying computers for the year 2000.
These statements, and any other statements contained in this report that are
not historical facts, are forward-looking statements that are based on a series
of projections and estimates regarding the economy, the electric utility
business and Florida Progress' other businesses in general, and on factors
which impact Florida Progress directly. The projections and estimates relate to
the pricing of services, the actions of regulatory bodies, and the effects of
competition. The words "estimates", "believes," "expects," "anticipates,"
"plans" and "intends", and variations of such words, and similar expressions,
are intended to identify forward-looking statements that involve risks and
uncertainties.
Key factors that have a direct impact on the ability to attain these
projections include continued annual growth in customers, successful cost
containment efforts and the efficient operation of Florida Power's existing and
future generating units. Also, in developing its forward-looking statements,
Florida Progress has made certain assumptions relating to productivity
improvements and the favorable outcome of various commercial, legal and
regulatory proceedings and the lack of disruption to its markets.
If Florida Progress' and Florida Power's projections and estimates regarding
the economy, the electric utility business and other factors differ materially
from what actually occurs, or if various proceedings have unfavorable outcomes,
then actual results could vary significantly from the performance projected in
the forward-looking statements.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
INTEREST RATE RISK
Florida Progress is exposed to changes in interest rates primarily as a result
of its borrowing activities.
A hypothetical 49 basis point increase in interest rates (10% of Florida
Progress' weighted average interest rate) affecting Florida Progress' variable
rate debt ($814.3 million at March 31, 1999) would have an immaterial effect on
Florida Progress' pre-tax earnings over the next fiscal year. A hypothetical
10% decrease in interest rates would also have an immaterial effect on the
estimated fair value of Florida Progress' long-term debt at March 31, 1999.
COMMODITY PRICE RISK
Currently, at Florida Power, commodity price risk due to changes in market
conditions for fuel and purchased power are recovered through the fuel
adjustment clause, with no effect on earnings.
Electric Fuels is exposed to commodity price risk through coal sales, the scrap
steel market and fuel for its marine transportation business. A 10-percent
change in the market price of those commodities would have an immaterial effect
on the earnings of Florida Progress.
18
19
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
1. METROPOLITAN DADE COUNTY ("DADE") AND MONTENAY POWER CORP. ("MONTENAY") V.
FLORIDA POWER CORPORATION, CIRCUIT COURT OF THE ELEVENTH CIRCUIT FOR DADE
COUNTY, FLORIDA, CASE NO 96-09598-CA-30.
METROPOLITAN DADE COUNTY AND MONTENAY POWER CORP. V. FLORIDA PROGRESS
CORPORATION, FLORIDA POWER CORPORATION AND ELECTRIC FUELS CORPORATION, U.S.
DISTRICT COURT, SOUTHERN DISTRICT, MIAMI DIVISION, FLORIDA, CASE NO
96-594-DIV-LENARD.
IN RE: PETITION FOR DECLARATORY STATEMENT THAT ENERGY PAYMENTS ARE LIMITED
TO ANALYSIS OF AVOIDED UNIT'S CONTRACTUALLY SPECIFIED CHARACTERISTICS,
FLORIDA PUBLIC SERVICE COMMISSION, DOCKET NO. 980283-EQ.
See prior discussion of this matter in the 1998 Form 10-K, Item 3,
paragraph 1 and Note 2 to the Financial Statements contained herein. In the
Federal Court appeal, the Eleventh Circuit rules require that all appeals
go to mediation. Court-ordered mediation was held on March 17, 1999.
Although no resolution was reached, the parties are continuing their
discussions.
2. NCP LAKE POWER, INC. V. FLORIDA POWER CORPORATION, FLORIDA CIRCUIT COURT,
FIFTH JUDICIAL CIRCUIT FOR LAKE COUNTY, CASE NO. 94-2354-CA-01
IN RE: PETITION FOR DECLARATORY STATEMENT REGARDING THE NEGOTIATED CONTRACT
FOR PURCHASE OF FIRM CAPACITY AND ENERGY BETWEEN FLORIDA POWER CORPORATION
AND LAKE COGEN, LTD., FLORIDA PUBLIC SERVICE COMMISSION, DOCKET NO.
980509-EQ.
See prior discussion of this matter in the 1998 Form 10-K, Item 3,
paragraph 2 and Note 2 to the Financial Statements contained herein. On
April 6, 1999, in the Circuit Court case, the judge entered a non-final
trial order. The judge granted Lake's breach of contract claim and ruled
that Lake is entitled to receive "firm" energy payments during the on-peak
hours, but for all other hours Lake is entitled to the "as-available" rate.
The judge denied Lake's breach of contract claim relating to the coal
pricing dispute, denied Lake's claim for injunctive relief and denied the
Florida Power counterclaim. A hearing on damages has not yet been set.
3. STATE OF OKLAHOMA, EX REL. JOHN P. CRAWFORD, INSURANCE COMMISSIONER V.
MID-CONTINENT LIFE INSURANCE COMPANY, DISTRICT COURT OF OKLAHOMA COUNTY,
STATE OF OKLAHOMA, CASE NO. CJ-97-2518-62
STATE OF OKLAHOMA, EX REL, JOHN P. CRAWFORD, INSURANCE COMMISSIONER AS
RECEIVER FOR MID-CONTINENT LIFE INSURANCE COMPANY V. FLORIDA PROGRESS
CORPORATION, A FLORIDA CORPORATION, JACK BARRON CRITCHFIELD, GEORGE RUPPEL,
THOMAS STEVEN KRZESINSKI, RICHARD KORPAN, RICHARD DONALD KELLER, JAMES LACY
HARLAN, GERALD WILLIAM MCRAE, THOMAS RICHARD DLOUHY, ANDREW JOSEPH BEAL AND
ROBERT TERRY STUART, JR., DISTRICT COURT OF OKLAHOMA COUNTY, STATE OF
OKLAHOMA, CASE NO. CJ-97-2518-62 (PART OF THE SAME CASE NOTED ABOVE).
MICHAEL FARRIMOND, PAMELA S. FARRIMOND, ANGELA FRY, JOWHNA HILL, AND
BARBARA HODGES, FOR THEMSELVES AND ALL OTHERS SIMILARLY SITUATED V. FLORIDA
PROGRESS CORPORATION, A FLORIDA CORPORATION, JACK BARRON CRITCHFIELD,
GEORGE RUPPEL, THOMAS STEVEN KRZESINSKI, RICHARD KORPAN, RICHARD DONALD
KELLER, JAMES LACY HARLAN, GERALD WILLIAM MCRAE, THOMAS RICHARD DLOUHY,
ANDREW JOSEPH BEAL AND ROBERT TERRY STUART, JR., DISTRICT COURT OF OKLAHOMA
COUNTY, STATE OF OKLAHOMA, CASE NO. CJ-99-130-65
19
20
See prior discussion in this matter in the 1998 Form 10-K, Item 3,
paragraph 6 and Note 2 to the Financial Statements contained herein. An
agreed order outlining a plan of rehabilitation was filed on March 18,
1999. The evaluation of bids should be completed by the end of June 1999.
The Defendants' motion to transfer the Farrimond case to the receivership
court was denied on March 18, 1999, and Defendants filed their motions to
dismiss on March 29, 1999. The hearings on Defendants' motions are set for
May 1999.
4. PEAK OIL COMPANY, MISSOURI ELECTRIC WORKS, 62ND STREET, AKO BAYSIDE BLUFF
ELECTRIC AND HOLLOWAY SUPERFUND SITES.
See prior discussion of this matter in the 1998 Form 10-K, Item 3,
paragraph 7. The EPA has advised Florida Power that it no longer considers
Florida Power to be a "potentially responsible party" or to have liability
under the Comprehensive Environmental Response Compensation and Liability
Act ("CERCLA") in connection with the Holloway site.
5. IN RE: JOINT PETITION FOR DETERMINATION OF NEED FOR AN ELECTRICAL POWER
PLANT IN VOLUSIA COUNTY BY THE UTILITIES COMMISSION, CITY OF NEW SMYRNA
BEACH, AND DUKE ENERGY NEW SMYRNA BEACH POWER COMPANY LTD., L.L.P. PUBLIC
SERVICE COMMISSION, DOCKET NO. 981042-EM.
See prior discussion of this matter in the 1998 Form 10-K, Item 3,
paragraph 11. On April 21, 1999, Florida Power filed an appeal of the
FPSC's decision with the Florida Supreme Court.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY-HOLDERS
The Annual meeting of Shareholders of Florida Progress was held on April 16,
1999. There were 97,390,973 shares of common stock entitled to vote. The
following matters were voted upon at the meeting:
Election of Directors
Class III - Terms expiring in 2002
VOTES VOTES
FOR WITHHELD
Clarence V. McKee, Esq 78,537,563 1,064,523
Richard A. Nunis 78,599,786 1,002,300
Jean Giles Wittner 78,596,398 1,005,688
Class II - Terms expiring in 2001
Richard Korpan 78,578,611 1,023,475
20
21
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) EXHIBITS:
FLORIDA FLORIDA
NUMBER EXHIBIT PROGRESS POWER
------ ------- -------- -------
10 Agreement between Florida X
Progress and Edward W. Moneypenny
dated as of March 15, 1999,
regarding change in control
12 Statement Regarding Computation X
of Ratio of Earnings to Fixed
Charges for Florida Power
27.(a) Florida Progress Financial Data X
Schedule.
27.(b) Florida Power Financial Data X
Schedule.
X = Exhibit is filed for that respective company
(b) REPORTS ON FORM 8-K:
During the first quarter 1999, Florida Progress and Florida Power
filed the following reports on Form 8-K:
Form 8-K dated January 25, 1999, reporting under Item 5 "Other
Events" a press release and related Investor news report which
stated Florida Progress' and Florida Power's 1998 year-end
earnings.
Form 8-K dated February 18, 1999 reporting under Item 5 "Other
Events" an increase in Florida Progress' annual dividend and the
construction by Florida Power of peaking units.
In addition, Florida Progress and Florida Power filed the following
report on Form 8-K subsequent to the first quarter 1999:
Form 8-K dated April 16, 1999, reporting under Item 5 "Other
Events" Florida Progress' and Florida Power's first quarter 1999
earnings.
21
22
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.
FLORIDA PROGRESS CORPORATION
Date: May 13, 1999 /s/ John Scardino, Jr.
-------------------------------------
John Scardino, Jr.
Vice President and Controller
Date: May 13, 1999 /s/ Edward W. Moneypenny
-------------------------------------
Edward W. Moneypenny
Senior Vice President and
Chief Financial Officer
23
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.
FLORIDA POWER CORPORATION
Date: May 13, 1999 /s/ John Scardino, Jr.
-------------------------------------
John Scardino, Jr.
Vice President and Controller
Date: May 13, 1999 /s/ Jeffrey R. Heinicka
-------------------------------------
Jeffrey R. Heinicka
Senior Vice President and
Chief Financial Officer
24
EXHIBIT INDEX
FLORIDA FLORIDA
NUMBER EXHIBIT PROGRESS POWER
------ ------- -------- -------
10 Agreement dated March 15, 1999 with X
Edward W. Moneypenny regarding
change of control
12 Statement Regarding computation of Ratio X
of Earnings to Fixed Charges for Florida
Power.
27.(a) Florida Progress Financial Data Schedule X
27.(b) Florida Power Financial Data Schedule X
X = Exhibit is filed for that respective company.