Exhibit 99.2
Consolidated Report to
the Financial Community (Unaudited)
- -----------------------------------
----------------------------------------------------------
First Quarter 2003 Highlights |After Tax EPS Variance Analysis 1st Qtr.|
(Released April 30, 2003) |-------------------------------- ------- |
|1st Quarter 2002 Basic EPS - GAAP Basis $ 0.40 |
o Net income for the first | One-Time Items - 2002 (See page 6) 0.05 |
quarter, before a cumulative | ----- |
effect of an accounting change |1st Quarter 2002 Normalized Earnings $ 0.45 |
for the adoption of SFAS No. | Electric Gross Margin 0.23 |
143, was $139 million, or | Natural Gas Gross Margin 0.04 |
$0.47 per share. Excluding | International Operaitons (0.04)|
costs associated with the | Pension and Other Employee Benefits (0.10)|
Davis-Besse extended outage, | Depreciation and Amortization (0.04)|
normalized earnings were $0.65 | Financing Costs 0.11 |
per share, compared to first | ----- |
quarter 2002 normalized |1st Quarter 2003 Normalized Earnings $ 0.65 |
earnings of $0.45 per share. | Davis-Besse Incremental Expenses (0.18)|
Net income for the first | ----- |
quarter of 2003 was $241 |Subtotal $ 0.47 |
million, or $0.82 per share, | Cumulative Effect of Accounting Change - 2003 0.35 |
compared to $116 million, or | ----- |
$0.40 per share, for the same |1st Quarter 2003 Basic EPS - GAAP Basis $ 0.82 |
period last year. | ===== |
----------------------------------------------------------
1Q 2003 Results Compared With 1Q 2002
- -------------------------------------
o Electric distribution deliveries increased 9%, largely driven by a 15% rise
in residential deliveries, reflecting colder weather. Commercial deliveries
increased 12%, while industrial deliveries only increased slightly. Total
electric generation sales increased 31%. Approximately 75% of the increase
was attributable to higher wholesale sales and 25% attributable to higher
retail sales.
o Electric gross margin increased $113 million after adjusting for changes in
regulatory deferrals and Davis-Besse replacement power costs. Excluding
these adjustments, electric sales revenue increased $390 million, due
largely to an increase in wholesale spot sales and Basic Generation Service
sales in New Jersey. Purchased power costs increased $290 million, after
adjusting for regulatory deferrals and $52 million of Davis-Besse
replacement power costs. Fuel expenses decreased $13 million due to lower
generation output.
o Natural gas gross margin rose $21 million, primarily due to reduced
sourcing costs for our gas marketing business.
o International operations net income decreased $12 million primarily as a
result of the earnings reflected last year, when we owned 100% of Avon
Energy Partners Holdings.
o Pension and other employee benefit costs increased $50 million, principally
reflecting reduced asset values, reduced return assumptions on trust
assets, and lower discount rates used to value projected obligations.
1
o Total depreciation and amortization expenses increased $19 million. The
increase is primarily attributable to a $29 million increase in Ohio
transition costs amortization and $10 million of depreciation expense
associated with the Lake Plants in 2003. These expenses were partially
offset by $18 million of lower nuclear decommissioning and depreciation
expenses related to SFAS No. 143 implementation.
o Excluding international operations, net interest charges decreased $47
million as a result of our aggressive debt reduction program and
refinancing initiatives. Financing activities during the quarter included
$122 million in mandatory long-term debt redemptions, $563 million of
refinancings, and $50 million in incremental long-term debt issuance.
2003 Earnings Impact Associated with Davis-Besse
- ------------------------------------------------
o Incremental expenses associated with the extended outage at Davis-Besse
during the quarter totaled $88 million, or $0.18 per share ($52 million of
replacement power costs and $36 million of O&M expenses).
For additional information, please contact:
Kurt E. Turosky Terrance G. Howson Thomas C. Navin
Director, Vice President, Treasurer
Investor Relations Investor Relations (330) 384-5889
(330) 384-5500 (973) 401-8519
2
Actual
FIRSTENERGY CORP. Three Months Ended
CONSOLIDATED INCOME March 31,
---------------------------------------
STATEMENTS (thousands): 2003 2002 Change
---------------------------------------- ----------- ----------- ---------
(1)REVENUES:
(2) Electric Sales $ 2,633,200 $ 2,085,000 $ 548,200
(3) Natural Gas 248,496 204,594 43,902
(4) FE Facilities 77,380 119,753 (42,373)
(5) MYR 112,294 139,794 (27,500)
(6) International 42,340 204,626 (162,286)
(7) Other 130,762 99,511 31,251
----------- ----------- ---------
(8) Total revenues 3,244,472 2,853,278 391,194
----------- ----------- ---------
(9)
(10)EXPENSES:
(11) Fuel 157,738 170,621 (12,883)
(12) Purchased Power 1,024,372 514,219 510,153
(13) Purchased Gas 229,465 206,227 23,238
(14) Other operating expenses 720,644 695,337 25,307
(15) FE Facilities 78,263 118,135 (39,872)
(16) MYR 110,635 136,871 (26,236)
(17) International 16,007 88,547 (72,540)
(18) Mark-to-Market Adjustment 3,690 (1,139) 4,829
(19) Provision for depreciation and amortization 281,662 262,828 18,834
(20) General taxes 178,282 171,988 6,294
----------- ----------- ---------
(21) Total expenses 2,800,758 2,363,634 437,124
------------ ----------- ---------
(22)INCOME BEFORE INTEREST
(23) AND INCOME TAXES 443,714 489,644 (45,930)
----------- ----------- ----------
(24)Net interest charges:
(25) Interest expense 200,650 260,465 (59,815)
(26) Capitalized interest (9,152) (5,814) (3,338)
(27) Subsidiaries' preferred stock dividends 11,242 24,071 (12,829)
----------- ----------- ---------
(28) Net interest charges 202,740 278,722 (75,982)
----------- ----------- ---------
(29)Income taxes 102,136 94,429 7,707
----------- ----------- ---------
(30)Income before cumulative effect of a
(31) change in accounting 138,838 116,493 22,345
(32)Cumulative effect of a change in accounting 102,147 - 102,147
----------- ----------- ---------
(33)NET INCOME $ 240,985 $ 116,493 $ 124,492
=========== =========== =========
(34)
(35)Basic earnings per common share:
(36) Before accounting change $ 0.47 $ 0.40 $ 0.07
(37) Cumulative effect of accounting change 0.35 - 0.35
----------- ----------- ---------
(38) $ 0.82 $ 0.40 $ 0.42
=========== =========== =========
(39)Weighted average number of basic
(40) shares outstanding 293,886 292,791 1,095
=========== =========== =========
(41)
(42) Diluted earnings per common share:
(43) Before accounting change $ 0.47 $ 0.40 $ 0.07
(44) Cumulative effect of accounting change 0.35 - 0.35
----------- ----------- ---------
(45) $ 0.82 $ 0.40 $ 0.42
=========== =========== =========
(46)Weighted average number of diluted
(47) shares outstanding 294,877 294,492 385
=========== =========== =========
3
FirstEnergy Actual Consolidated Income Segments
Three Months Ended March 31, 2003
-----------------------------------------------------------------------
Regulated Competitive Other Reconciling
(In thousands): Services Services (c) Adjustments Consolidated
----------------------------------------- ----------- ----------- ------------- ------------ ------------
(1)REVENUES:
(2) Electric Sales $2,219,999 $ 413,201 $ - $ - $2,633,200
(3) Natural Gas - 248,496 - - 248,496
(4) FE Facilities - 77,380 - - 77,380
(5) MYR - 112,294 - - 112,294
(6) International - - 42,340 - 42,340
(7) Other 95,065 14,910 8,746 12,041 (a) 130,762
(8) Internal revenues 264,502 559,694 123,794 (947,990)(b) -
---------- ---------- --------- --------- ----------
(9) Total revenues 2,579,566 1,425,975 174,880 (935,949) 3,244,472
---------- ---------- --------- --------- ----------
(10)
(11)EXPENSES:
(12) Fuel - 155,322 2,416 - 157,738
(13) Purchased Power 1,111,612 472,454 - (559,694)(b) 1,024,372
(14) Purchased Gas - 229,465 - - 229,465
(15) Other operating expenses 531,559 422,941 107,692 (341,548)(a)(b) 720,644
(16) FE Facilities - 78,263 - - 78,263
(17) MYR - 110,635 - - 110,635
(18) International - - 16,007 - 16,007
(19) Mark-to-Market Adjustment - 3,841 (151) - 3,690
(20) Provision for depreciation and amortization 263,658 7,492 10,512 - 281,662
(21) General taxes 163,758 10,552 3,972 - 178,282
---------- ---------- --------- --------- ----------
(22) Total expenses 2,070,587 1,490,965 140,448 (901,242) 2,800,758
---------- ---------- --------- --------- ----------
(23)INCOME BEFORE INTEREST
(24) AND INCOME TAXES 508,979 (64,990) 34,432 (34,707) 443,714
---------- ---------- --------- --------- ----------
(25)Net interest charges:
(26) Interest expense 118,017 12,693 104,647 (34,707)(b) 200,650
(27) Capitalized interest (7,050) (2,102) - - (9,152)
(28) Subsidiaries' preferred stock dividends 11,242 - - - 11,242
---------- ---------- --------- --------- ----------
(29) Net interest charges 122,209 10,591 104,647 (34,707) 202,740
---------- ---------- --------- --------- ----------
(30)Income taxes 159,404 (31,336) (25,932) - 102,136
---------- ---------- --------- --------- ----------
(31)Income before cumulative effect of a
(32) change in accounting 227,366 (44,245) (44,283) - 138,838
(33)Cumulative effect of a change in accounting 100,960 1,187 - - 102,147
----------- ---------- --------- --------- ----------
(34)NET INCOME $ 328,326 $ (43,058) $ (44,283) $ - $ 240,985
========== ========== ========= ========= ==========
Three Months Ended Mar 31, 2002
------------------------------------------------------------------------
Regulated Competitive Other Reconciling
(In thousands): Services Services (c) Adjustments Consolidated
----------------------------------------- ---------- ----------- --------- ----------- ------------
(1)REVENUES:
(2) Electric Sales $1,924,242 $ 160,758 $ - $ - $2,085,000
(3) Natural Gas - 204,592 - - 204,592
(4) FE Facilities - 119,753 - - 119,753
(5) MYR - 139,794 - - 139,794
(6) International - - 204,626 - 204,626
(7) Other 70,620 12,955 9,409 6,529 (a) 99,513
(8) Internal revenues 354,680 410,296 117,459 (882,435)(b) -
---------- ---------- --------- --------- ----------
(9) Total revenues 2,349,542 1,048,148 331,494 (875,906) 2,853,278
---------- ---------- --------- --------- ----------
(10)
(11)EXPENSES:
(12) Fuel 1,176 166,533 2,912 - 170,621
(13) Purchased Power 905,791 66,665 - (458,237)(b) 514,219
(14) Purchased Gas - 206,227 - - 206,227
(15) Other operating expenses 516,672 440,453 141,475 (403,263)(a)(b) 695,337
(16) FE Facilities - 118,135 - - 118,135
(17) MYR - 136,871 - - 136,871
(18) International - - 88,547 - 88,547
(19) Mark-to-Market Adjustment - (9,184) 8,045 - (1,139)
(20) Provision for depreciation and amortization 243,779 6,661 12,388 - 262,828
(21) General taxes 160,912 7,251 3,825 - 171,988
---------- ---------- --------- --------- ----------
(22) Total expenses 1,828,330 1,139,612 257,192 (861,500) 2,363,634
---------- ---------- --------- --------- ----------
(23)INCOME BEFORE INTEREST
(24) AND INCOME TAXES 521,212 (91,464) 74,302 (14,406) 489,644
---------- ---------- ---------- --------- ----------
(25)Net interest charges:
(26) Interest expense 140,780 12,056 122,035 (14,406)(b) 260,465
(27) Capitalized interest (3,387) (2,427) - - (5,814)
(28) Subsidiaries' preferred stock dividends 24,071 - - - 24,071
---------- ---------- --------- --------- ----------
(29) Net interest charges 161,464 9,629 122,035 (14,406) 278,722
---------- ---------- ---------- --------- ----------
(30)Income taxes 161,876 (41,469) (25,978) - 94,429
---------- ---------- --------- --------- ----------
(31)Income before cumulative effect of a
(32) change in accounting 197,872 (59,624) (21,755) - 116,493
(33)Cumulative effect of a change in accounting - - - - -
---------- ---------- --------- --------- ----------
(34)NET INCOME $ 197,872 $ (59,624) $ (21,755) $ - $ 116,493
========== ========== ========= ========= ==========
4
FirstEnergy Actual Consolidated Income Segments
Three Months Ended March 31, 2003 VS 2002
----------------------------------------------------------------------
Regulated Competitive Other Reconciling
(In thousands): Services Services (c) Adjustments Consolidated
---------------------------------------- --------- ----------- --------- ------------ ------------
(1)REVENUES:
(2) Electric Sales $ 295,757 $ 252,443 $ - $ - $ 548,200
(3) Natural Gas - 43,904 - - 43,904
(4) FE Facilities - (42,373) - - (42,373)
(5) MYR - (27,500) - - (27,500)
(6) International - - (162,286) - (162,286)
(7) Other 24,445 1,955 (663) 5,512 (a) 31,249
(8) Internal revenues (90,178) 149,398 6,335 (65,555)(b) -
--------- --------- --------- --------- ---------
(9) Total revenues 230,024 377,827 (156,614) (60,043) 391,194
--------- --------- --------- --------- ---------
(10)
(11)EXPENSES:
(12) Fuel (1,176) (11,211) (496) - (12,883)
(13) Purchased Power 205,821 405,789 - (101,457)(b) 510,153
(14) Purchased Gas - 23,238 - - 23,238
(15) Other operating expenses 14,887 (17,512) (33,783) 61,715 (a)(b) 25,307
(16) FE Facilities - (39,872) - - (39,872)
(17) MYR - (26,236) - - (26,236)
(18) International - - (72,540) - (72,540)
(19) Mark-to-Market Adjustment - 13,025 (8,196) - 4,829
(20) Provision for depreciation and amortization 19,879 831 (1,876) - 18,834
(21) General taxes 2,846 3,301 147 - 6,294
--------- --------- --------- --------- ---------
(22) Total expenses 242,257 351,353 (116,744) (39,742) 437,124
--------- --------- --------- ---------- ---------
(23)INCOME BEFORE INTEREST
(24) AND INCOME TAXES (12,233) 26,474 (39,870) (20,301) (45,930)
--------- --------- --------- --------- ---------
(25)Net interest charges:
(26) Interest expense (22,763) 637 (17,388) (20,301)(b) (59,815)
(27) Capitalized interest (3,663) 325 - - (3,338)
(28) Subsidiaries' preferred stock dividends (12,829) - - - (12,829)
--------- --------- --------- ---------- ---------
(29) Net interest charges (39,255) 962 (17,388) (20,301) (75,982)
--------- --------- --------- --------- ---------
(30)Income taxes (2,472) 10,133 46 - 7,707
--------- --------- --------- --------- ---------
(31)Income before cumulative effect of a
(32) change in accounting 29,494 15,379 (22,528) - 22,345
(33)Cumulative effect of a change in accounting 100,960 1,187 - - 102,147
--------- --------- --------- --------- ---------
(34)NET INCOME $ 130,454 $ 16,566 $ (22,528) $ - $ 124,492
========= ========= ========= ========= =========
Reconciling adjustments to segment operating results from internal management reporting to consolidated external
financial reporting.
(a) Principally fuel marketing revenues which are reflected as reductions
to expenses for internal management reporting purposes.
(b) Elimination of intersegment transactions.
(c) "Other" segment primarily consists of corporate support services and
international businesses.
5
FirstEnergy Statistical Summary
- ----------------------------------------------------------------------------------------------------
FirstEnergy Combined Electric Sales Statistics
- ----------------------------------------------------------------------------------------------------
Three Months Ended March 31,
----------------------------------
2003 2002 Change
--------- --------- -------
(In Millions)
ELECTRIC GENERATION SALES (KWHs):
Retail -
Regulated 22,118 21,672 2.1%
Unregulated 3,230 1,403 130.2%
---------- --------- --------
Total Retail 25,348 23,075 9.9%
Wholesale 10,426 4,321 141.3%
---------- --------- --------
Total Electric Generation Sales 35,774 27,396 30.6%
========= ========= ========
ELECTRIC DISTRIBUTION DELIVERIES (KWHs):
Residential 10,127 8,773 15.4%
Commercial 8,292 7,427 11.6%
Industrial 8,724 8,608 1.3%
Other 140 138 1.4%
--------- --------- --------
Total Distribution Deliveries 27,283 24,946 9.4%
========= ========= ========
ELECTRIC SALES SHOPPED (KWHs):
Residential 1,647 1,178 39.8%
Commercial 1,626 719 126.1%
Industrial 1,892 1,377 37.4%
--------- --------- --------
Total Electric Sales Shopped 5,165 3,274 57.8%
========= ========= ========
- ----------------------------------------------------------------------------------------------------
At March 31,
-------------------------------------------------------------
2003 % Total 2002 % Total
------------ -------- ------------ -------
Capitalization ( in thousands):
-------------------------------
Total common equity $ 7,262,260 31% $ 7,436,518 29%
Preferred stock * 765,363 3% 1,074,971 4%
Long-term debt * 12,666,967 55% 14,706,813 57%
Short-term debt * 855,327 4% 862,528 3%
Off-balance sheet debt equivalents:
- Sale-leaseback arrangements 1,496,580 6% 1,467,254 6%
- Accounts receivable factoring 145,000 1% 200,000 1%
------------ ------- ------------ ------
Total Capitalization $ 23,191,497 100% $ 25,748,084 100%
============ ======= ============ ======
* Includes amounts due to be paid within one year, JCP&L securitization of $320 million and debt related to pending
divestitures in 2002.
- ------------------------------------------------------------------------------------------------------------------------
Three Months Ended March 31,
------------------------------------------------------
2003 2002 Change
------------------------------------------------------
(in thousands)
Financial Statistics ( in thousands):
------------------------------------
L-T Debt and Preferred Stock Redemptions $ 121,814 $ 167,529 $ (45,715)
Short-term Debt Increase (Decrease) $ (237,490) $ (16,338) $(221,152)
Capital Investments $ 190,841 $ 164,918 $ 25,923
- ------------------------------------------------------------------------------------------------------------------------
One-Time Items: 2003 vs 2002 (a) Three Months Ended
March 31,
-----------------------------------------------------
2003 2002 Change
---------- ---------- --------
Long-term Derivative Contract Adjustment $ - $ (18,091) $ 18,091
Equity Investment - Bankruptcy - (30,371) 30,371
Telecommunications Investment Writedown - (12,610) 12,610
Generation Project Cancellation - (17,102) 17,102
Cumulative Avon adjustment (b) - 45,300 (45,300)
---------- ---------- --------
Total - Income before income taxes $ - $ (32,874) $ 32,874
========== ========== ========
EPS Effect $ 0.00 $ (0.05) $ 0.05
========== ========== ========
Notes: (a) Expense amounts except as noted in footnote (b)
(b) Cumulative Avon adjustment amounts reflected in 2002 income statement -
Revenues - international $ 91,300
Expenses - international 27,100
Net interest charges 18,900
--------
Income before income taxes 45,300
Income taxes 13,600
---------
Net income $ 31,700
========
6
FirstEnergy Statistical Summary
Three Months Ended
March 31,
-----------------------------------
2003 2002 Change
--------- --------- --------
NATURAL GAS SALES (Decatherms): (in thousands)
Retail 29,577 38,266 -22.7%
Wholesale 10,037 12,300 -18.4%
--------- ------- --------
Total Natural Gas Sales 39,614 50,566 -21.7%
========= ======= ========
- -----------------------------------------------------------------------------
Three Months Ended March 31,
-----------------------------------
2003 2002 Change
--------- --------- --------
Regulatory Asset Amortization (in thousands)
------------------------------
Depreciation and Amortization $ 181,234 $ 142,789 $ 38,445
Income Tax Amortization 15,490 13,070 2,420
--------- --------- --------
Total $ 196,724 $ 155,859 $ 40,865
========= -======== ========
Regulatory Deferrals
---------------------
Ohio Transition Plan
--------------------
Beginning Balance $ 259,353 $ 75,406
Deferral of Shopping Incentives 45,426 31,036 $ 14,390
Deferral of New Regulatory Assets 4,589 12,459 (7,870)
--------- --------- --------
Current period deferrals 50,015 43,495 $ 6,520
========
--------- ---------
Ending Balance-Ohio Deferrals $ 309,368 $ 118,901
========= =========
Deferred Energy Costs
-----------------------
Pennsylvania
------------
Beginning Balance $ - $ 218,531
Deferral (recovery) of energy costs - (19,131) $ 19,131
--------- --------- --------
Current period change - (19,131) $ 19,131
--------- --------- ========
Ending Balance $ - $ 199,400
========= =========
New Jersey
----------
Beginning Balance $ 548,641 $ 301,204
Deferral (recovery) of energy costs (18,313) 18,651 $(36,964)
--------- --------- ========
Ending Balance $ 530,328 $ 319,855
========= =========
Mark-to-Market Adjustment
--------------------------
Expenses - Pre-Tax Income Effect:
Increase (Decrease) $ 3,690 $ (1,139) $ 4,829
EPS Effect $ (0.01) $ 0.00 $ (0.01)
- ---------------------------------------------------------------------
At March 31,
---------------------------
Operating Statistics (12 mos. Ending) 2003 2002
------------------------------------- ------ ------
System Load Factor 61.3% 59.2%
Capacity Factors:
Fossil 59.9% 53.1%
Nuclear 70.8% 86.4%
Generation Output:
Fossil 67% 59%
Nuclear 33% 41%
Weather
-------
Composite Heating Days Year-to-Date 3,116 2,519
(Normal - 2,806)
7
RECENT DEVELOPMENTS
Standard & Poor's (S&P) and Moody's Ratings Actions
- ---------------------------------------------------
On April 14, S&P Ratings Services affirmed its 'BBB' corporate credit rating on
FirstEnergy Corp. and its subsidiaries. S&P also upgraded FirstEnergy's Business
Position rating from '6' to '5.' In addition, on April 11, Moody's Investors
Service affirmed its 'Baa2' issuer and senior unsecured ratings for FirstEnergy
Corp.
Davis-Besse Nuclear Power Station
- ---------------------------------
FirstEnergy continues to make progress toward returning Davis-Besse to safe and
reliable operation. Milestones achieved included modification of the Containment
Emergency Sump, installation of a FLUS leak detection system on the bottom of
the reactor vessel, and successful completion of the Integrated Leak Rate Test
on the containment building. Additionally, the Company's consultant, Dr. Sonja
Haber, has completed the safety culture assessment report, which will be
discussed at a future NRC meeting. The next milestone will be the pressure test
of the reactor coolant system, including the reactor vessel.
Nuclear Plant Refueling Outages
- -------------------------------
Beaver Valley Unit 1 completed its refueling outage and returned to service on
April 29. During the refueling, repairs were made to minor surface cracks on
four of the 65 control rod drive mechanism nozzles. The cracks did not result in
coolant leakage and inspection of the reactor head indicated it is in good
condition.
The Perry Plant began its refueling outage on April 5 and is expected to return
to service in early May.
Jersey Central Power & Light (JCP&L) Rate Case
- ----------------------------------------------
The schedule in the JCP&L rate case has been revised as follows:
o Hearings completed on o Administrative Law Judge Recommended Decision
April 28 due end of June
o Briefs are due May 2 o Board of Public Utilities decision expected in
July
o Reply Briefs are due May 16 o New rates will be effective August 1
Pennsylvania Public Utility Commission (PAPUC) Activity
- -------------------------------------------------------
Following the Pennsylvania Supreme Court's denial of appeals of the Commonwealth
Court's Order on the merger settlement and Provider of Last Resort rate relief,
the PAPUC:
o transmitted the issue of merger savings to the Office of Administrative Law
Judge for hearings,
o directed Met-Ed and Penelec to file a position paper by May 2 describing
the status of a settlement stipulation in light of the Commonwealth Court's
opinion; and
o directed all interested parties to submit responses within 30 days of the
Companies' position paper filing
Shelf Registration
- ------------------
On March 17, FirstEnergy filed a registration statement with the U.S. Securities
and Exchange Commission covering securities in the aggregate of up to $2
billion. Although the Company does not have any current plans to issue
securities, the shelf provides the flexibility to issue and sell various types
of securities, including common stock, debt securities, or share purchase
contracts and related share purchase units.
Emdersa Abandonment
- -------------------
On April 18, FirstEnergy divested its ownership in the Argentine distribution
company Emdersa through the abandonment of its shares in Emdersa's parent
company, GPU Argentina Holdings, Inc. FirstEnergy will recognize a one-time,
non-cash charge of $63 million in the second quarter ($0.21 per share). Since
FirstEnergy had recorded a $90 million currency translation adjustment in the
fourth quarter of 2002, the net effect of the $63 million charge will be an
increase in common shareholders' equity of $27 million. FirstEnergy anticipates
income tax benefits of $129 million related to the abandonment, which will be
reflected in earnings in a future period.
This Consolidated Report to the Financial Community includes forward-looking
statements based on information currently available to management. Such
statements are subject to certain risks and uncertainties. These statements
typically contain, but are not limited to, the terms "anticipate," "expect,"
"believe," "estimate," and similar words. Actual results may differ materially
due to a number of factors including, but not limited to, the speed and nature
of regulatory approvals.
8