Exhibit 99.1
News Release
Vectren Corporation
P.O. Box 209
Evansville, IN 47702-0209
March 13, 2003
FOR IMMEDIATE RELEASE
Vectren Corporation
Reports Final 2002 Results
Completes 2001 and 2000 Reaudits
Affirms 2003 Guidance
Evansville, Indiana - Vectren Corporation (NYSE:VVC) today reported net income
for the year ended December 31, 2002 of $114.0 million, or $1.69 per share; net
income for the year ended December 31, 2001 of $52.7 million, or $0.79 per
share, as restated; and net income for the year ended December 31, 2000 of $72.0
million, or $1.18 per share, as restated. These results include nonrecurring
merger, integration and restructuring costs and other nonrecurring items
totaling $26.4 million after tax, or $0.40 per share, for fiscal year 2001 and
$31.9 million after tax, or $0.52 per share, for fiscal year 2000.
The completion of the audits for the three years resulted in only minor
adjustments to the preliminary results reported on January 29, 2003. The Company
expects to file its 2002 Annual Report on Form 10-K with the Securities Exchange
Commission early next week.
Said Niel C. Ellerbrook, Chairman and CEO, "I am pleased to report that all work
around the 2002, 2001 and 2000 audits is complete and no material changes were
made to our preliminary reported numbers. We have worked diligently to bring
closure to 2002 and the two prior years and we are now well positioned to
execute our permanent financing strategy. Fiscal year 2003 is off to a very good
start with colder than normal weather and a strong wholesale power market. Even
though we are continuing in an uncertain economic and political environment, we
remain confident in our 2003 business plan and earnings expectations."
Affirms 2003 Guidance
Vectren confirmed 2003 earnings guidance in the range of $1.75 to $1.85 per
share, including the potential impact of any permanent financing to be completed
during 2003. This range is consistent with previous guidance of $1.80 to $1.90
per share, which excluded the potential impact of any permanent financing plans.
Announces Annual Meeting
The Company's Annual Meeting will be held at 10:00 a.m. CT on Wednesday, May 14,
2003 at the Victory Theatre in Evansville, Indiana. The shareholder record date
is March 24, 2003.
Summarization of changes from preliminary results reported January 29, 2003
For the year ended December 31, 2002, net income was $114.0 million, or $1.69
per share. This represents a decrease to the company's previously announced
preliminary net income of approximately $.6 million.
For the year ended December 31, 2001, restated net income was $52.7 million, or
$0.79 per share. This is an increase to the company's previously announced
preliminary restated net income of $1.5 million. The total effect of all changes
related to the restatements reduced previously reported 2001 earnings by
approximately $10.9 million after tax, or $0.16 per share.
For the year ended December 31, 2000, restated net income was $72.0 million, or
$1.18 per share. The total effect of all changes related to the restatements
decreased the company's previously reported net income by approximately $48,000.
The impact of other changes related to the restatement increased the company's
beginning retained earnings at January 1, 2000 by $1.7 million.
Please SEE ATTACHED unaudited schedules for additional financial information
About Vectren
Vectren Corporation is an energy and applied technology holding company
headquartered in Evansville, Indiana. Vectren's energy delivery subsidiaries
provide gas and/or electricity to over one million customers in adjoining
service territories that cover nearly two-thirds of Indiana and west central
Ohio. Vectren's non-regulated subsidiaries and affiliates currently offer
energy-related products and services to customers throughout the surrounding
region. These services include energy marketing; coal mining; utility
infrastructure services; and broadband communication services. To learn more
about Vectren, visit www.vectren.com.
Safe Harbor for Forward Looking Statements
This document contains forward-looking statements, which are based on
management's beliefs and assumptions that derive from information currently
known by management. Vectren wishes to caution readers that actual results could
differ materially from those contained in this document. Additional detailed
information concerning a number of factors that could cause actual results to
differ materially from the information that is provided to you is readily
available in our report Form 10-K filed with the Securities and Exchange
Commission on March 29, 2002.
Investor Contact Steven M. Schein, (812) 491-4209, sschein@vectren.com
-------------------
Media Contact Jeffrey W. Whiteside, (812) 491-4205, jwhiteside@vectren.com
----------------------
###
VECTREN CORPORATION
AND SUBSIDIARY COMPANIES
CONSOLIDATED STATEMENTS OF INCOME
(Thousands, except for share amounts)
(Unaudited)
Twelve Months
Ended December 31
------------------------------------------
2002 2001 2000
---------- ----------- -----------
OPERATING REVENUE: As Restated As Restated
----------- -----------
Gas utility $ 909,027 $ 1,019,574 $ 820,388
Electric utility 608,116 381,233 334,428
Energy services and other 287,191 681,033 478,037
---------- ----------- ----------
Total operating revenues 1,804,334 2,081,840 1,632,853
---------- ----------- ----------
OPERATING EXPENSES:
Cost of gas sold 571,216 708,907 552,540
Fuel for electric generation 81,619 74,401 75,700
Purchased electric energy 296,267 86,928 36,394
Cost of energy services and other 249,417 640,904 453,236
Other operating 222,948 243,230 198,456
Merger and integration costs - 2,808 41,145
Restructuring costs - 19,048 -
Depreciation and amortization 119,631 124,081 105,674
Taxes other than income taxes 51,902 53,714 38,010
---------- ----------- ----------
Total operating expenses 1,593,000 1,954,021 1,501,155
----------- ----------- ----------
OPERATING INCOME $ 211,334 $ 127,819 $ 131,698
OTHER INCOME:
Equity in earnings of unconsolidated
investments 9,082 13,388 9,856
Other - net 11,522 16,745 23,065
---------- ----------- ----------
Total other income 20,604 30,133 32,921
---------- ----------- ----------
INTEREST EXPENSE 78,481 83,168 56,404
---------- ----------- ----------
INCOME BEFORE INCOME TAXES $ 153,457 $ 74,784 $ 108,215
INCOME TAXES 38,883 14,091 34,202
MINORITY INTEREST IN SUBSIDIARY 514 620 1,004
PREFERRED DIVIDEND REQUIREMENT OF SUBSIDIARY 32 758 1,017
---------- ----------- ----------
NET INCOME BEFORE EXTRAORDINARY LOSS
AND CUMULATIVE EFFECT OF CHANGE IN
ACCOUNTING PRINCIPLE, NET OF TAX 114,028 $ 59,315 $ 71,992
EXTRAORDINARY LOSS, NET OF TAX - (7,706) -
CUMULATIVE EFFECT OF CHANGE IN ACCOUNTING
PRINCIPLE, NET OF TAX - 1,107 -
---------- ----------- ----------
NET INCOME $ 114,028 $ 52,716 $ 71,992
========== =========== ==========
AVERAGE COMMON SHARES OUTSTANDING 67,582 66,748 61,297
DILUTED COMMON SHARES OUTSTANDING 67,842 66,878 61,427
EARNINGS PER SHARE OF COMMON STOCK
BASIC:
NET INCOME BEFORE EXTRAORDINARY
LOSS AND CUMULATIVE EFFECT OF CHANGE
IN ACCOUNTING PRINCIPLE, NET OF TAX $ 1.69 $ 0.89 $ 1.18
EXTRAORDINARY LOSS, NET OF TAX - (0.12) -
CUMULATIVE EFFECT OF CHANGE IN ACCOUNTING
PRINCIPLE, NET OF TAX - 0.02 -
---------- ---------- ----------
EARNINGS PER SHARE OF COMMON STOCK $ 1.69 $ 0.79 $ 1.18
DILUTED:
NET INCOME BEFORE EXTRAORDINARY LOSS
AND CUMULATIVE EFFECT OF CHANGE IN
ACCOUNTING PRINCIPLE, NET OF TAX $ 1.68 $ 0.89 $ 1.17
EXTRAORDINARY LOSS, NET OF TAX - (0.12) -
CUMULATIVE EFFECT OF CHANGE IN
ACCOUNTING PRINCIPLE, NET OF TAX - 0.02 -
---------- ----------- ----------
EARNINGS PER SHARE OF COMMON STOCK $ 1.68 $ 0.79 $ 1.17
========== =========== ==========
VECTREN UTILITY HOLDINGS
AND SUBSIDIARY COMPANIES
CONSOLIDATED STATEMENTS OF INCOME
(Thousands)
(Unaudited)
Twelve Months
Ended December 31
-----------------------------------------
2002 2001 2000
----------- ----------- -----------
OPERATING REVENUE: As Restated As Restated
----------- -----------
Gas utility $ 909,027 $ 1,019,574 $ 820,388
Electric utility 608,116 381,233 334,428
----------- ----------- -----------
Total operating revenues 1,517,143 1,400,807 1,154,816
----------- ----------- -----------
OPERATING EXPENSES:
Cost of gas sold 571,833 708,907 552,540
Fuel for electric generation 81,619 74,401 75,700
Purchased electric energy 296,267 86,928 36,394
Other operating 220,520 241,080 208,940
Merger and integration costs - 2,795 32,712
Restructuring costs - 15,010 -
Depreciation and amortization 96,754 97,229 82,442
Taxes other than income taxes 50,846 51,249 36,238
----------- ----------- -----------
Total operating expenses 1,317,839 1,277,599 1,024,966
----------- ----------- -----------
OPERATING INCOME 199,304 123,208 129,850
OTHER INCOME:
Equity in earnings (losses) of
unconsolidated affiliates (1,859) (463) -
Other - net 6,988 5,501 4,793
----------- ----------- -----------
Total other income 5,129 5,038 4,793
----------- ----------- -----------
INTEREST EXPENSE 66,141 70,142 46,125
----------- ----------- -----------
INCOME BEFORE INCOME TAXES 138,292 58,104 88,518
INCOME TAXES 44,642 18,388 35,006
PREFERRED DIVIDEND REQUIREMENT OF SUBSIDIARY 32 758 1,017
----------- ----------- -----------
INCOME BEFORE CUMULATIVE EFFECT OF
CHANGE IN ACCOUNTING PRINCIPLE, NET OF TAX 93,618 38,958 52,495
CUMULATIVE EFFECT OF CHANGE IN ACCOUNTING
PRINCIPLE, NET OF TAX - 1,107 -
----------- ----------- -----------
NET INCOME $ 93,618 $ 40,065 $ 52,495
=========== =========== ===========
VECTREN CORPORATION
HIGHLIGHTS
3 Months 3 Months 3 Months
(millions, except per share amounts) Ended March 31 Ended June 30 Ended September 30
---------------------------------------------------------
(Unaudited) 2002 2001 2002 2001 2002 2001
- --------------------------- ----------------------------------------------------------
As As As As As As
Restated Restated Restated Restated Restated Restated
-------- -------- -------- -------- -------- --------
Reported Earnings:
Utility Group $ 41.0 $ 36.1 $ 7.0 $(13.3) $ 8.5 $ (1.4)
Non-regulated Group 4.4 7.6 4.4 (2.6) 5.8 6.0
Corporate and Other 0.1 1.2 1.1 (2.4) (0.7) (0.8)
------ ------ ------ ------ ------ ------
Vectren Consolidated $ 45.5 $ 44.9 $ 12.5 $(18.3) $ 13.6 $ 3.8
Merger, Integration and
Restructuring Costs:
Utility Group $ - $ 2.3 $ - $ 8.4 $ - $ 3.2
Non-regulated Group - - - 0.4 - 0.9
Corporate and Other - - - 0.2 - -
------ ------ ------ ------ ------ ------
Total - 2.3 - 9.0 - 4.1
Other Non-Recurring Items:
Utility Group-Cumulative Effect of
Adoption of FAS 133 $ - $ 1.1 $ - $ - $ - $ -
Non-regulated Group-Extraordinary
Loss in 2001 - - - (7.7) - -
------ ------ ------ ------ ------ ------
Income From Operations:
Utility Group $ 41.0 $ 37.3 $ 7.0 $ (4.9) $ 8.5 $ 1.8
Non-regulated Group
Energy Marketing and Services 4.6 5.0 3.6 1.7 2.9 3.3
Coal Mining 2.0 1.9 2.9 3.3 4.0 3.8
Utility Infrastructure Services (0.5) (0.7) - (0.2) 0.1 (0.1)
Broadband 0.1 (0.1) 0.1 - 0.1 -
Other Businesses (1.8) 1.5 (2.2) 0.7 (1.3) (0.1)
------ ------ ------ ------ ------- ------
Total Non-regulated Group 4.4 7.6 4.4 5.5 5.8 6.9
Corporate and Other 0.1 1.2 1.1 (2.2) (0.7) (0.8)
------ ------ ------ ------ ------- ------
Vectren Consolidated $ 45.5 $ 46.1 $ 12.5 $ (1.6) $ 13.6 $ 7.9
====== ====== ====== ====== ====== ======
VECTREN CORPORATION
HIGHLIGHTS
3 Months 12 Months
(millions, except per share amounts) Ended December 31 Ended December 31
-------------------------------------
(Unaudited) 2002 2001 2002 2001
- -------------------------------------- -------------------------------------
As As As As
Restated Restated Restated Restated
-------- -------- -------- --------
Reported Earnings:
Utility Group $ 37.1 $ 18.7 $ 93.6 $ 40.1
Non-regulated Group 4.4 1.1 19.0 12.1
Corporate and Other 0.9 2.5 1.4 0.5
------ ------ ------ ------
Vectren Consolidated $ 42.4 $ 22.3 $114.0 $ 52.7
Merger, Integration and Restructuring Costs:
Utility Group $ - $ 3.1 $ - $ 17.0
Non-regulated Group - 0.9 - 2.2
Corporate and Other - 0.4 - 0.6
----- - ------ ------ ------
Total - 4.4 - 19.8
Other Non-Recurring Items:
Utility Group-Cumulative Effect of Adoption
of FAS 133 $ - $ - $ - $ 1.1
Non-regulated Group-Extraordinary
Loss in 2001 - - - (7.7)
----- - ------ ------ ------
Income From Operations:
Utility Group $ 37.1 $ 21.8 $ 93.6 $ 56.0
Non-regulated Group
Energy Marketing and Services 3.9 1.7 15.0 11.7
Coal Mining 3.3 5.2 12.2 14.2
Utility Infrastruce Services (0.8) 0.4 (1.2) (0.6)
Broadband 0.1 (0.1) 0.4 (0.2)
Other Businesses (2.1) (5.2) (7.4) (3.1)
------ ------ ------ ------
Total Non-regulated Group 4.4 2.0 19.0 22.0
Corporate and Other 0.9 2.9 1.4 1.1
------ ------ ------ ------
Vectren Consolidated $ 42.4 $ 26.7 $114.0 $ 79.1
====== ====== ====== ======
Vectren Selected Highlights
12 months 12 months
Ended Ended
December 31 December 31
2002 2001
----------- -----------
Dividends Paid (per common
share, 12 months $ 1.07 $ 1.03
Annualized Dividend $ 1.10 $ 1.06
Dividend Yield (at close) 4.8% 4.4%
Dividend Payout Ratio 63.3% 130.4%
Dividend to Book Value 8.6% 8.5%
Return on Average Shareholder Equity 13.3% 6.7%
Book Value Per Share $ 12.81 $ 12.40
Market to Book Value (at close) 180% 193%
Common Stock Prices (VVC - NYSE)
High $ 26.10 $ 24.44
Low $ 17.95 $ 19.76
Close $ 23.00 $ 23.98
Price/Earnings Ratio (trailing) 13.6 30.4
Percent Internally Generated
Funds - Utility Group 86% 57%
Ratio of Earnings to Fixed Charges - SEC Method
Consolidated 2.9 1.8
Utility Group 3.0 1.8
VECTREN CORPORATION
SELECTED GAS DISTRIBUTION 12 Months
OPERATING STATISTICS Ended December 31
---------------------------
(Unaudited) 2002 2001
- ---------------------------------- ---------- -----------
As Restated
-----------
GAS OPERATING REVENUES (Thousands):
Residential $ 607,106 $ 676,843
Commercial 211,602 240,633
Contract 82,969 95,644
Miscellaneous Revenue 7,350 6,454
---------- ----------
$ 909,027 $1,019,574
========== ==========
GAS MARGIN (Thousands):
Operating Revenues $ 909,027 $1,019,574
Cost of Gas 571,216 708,907
---------- ----------
Margin $ 337,811 $ 310,667
========== ==========
GAS SOLD & TRANSPORTED (MDth):
Residential 80,726 73,812
Commercial 31,011 28,377
Contract 95,956 97,157
---------- ----------
207,693 199,346
========== ==========
YEAR END GAS CUSTOMERS:
Residential 882,151 868,685
Commercial 80,483 80,235
Contract 4,127 4,294
---------- ----------
966,761 953,214
========== ==========
WEATHER AS A PERCENT OF NORMAL:
Heating Degree Days 97% 91%
VECTREN CORPORATION
SELECTED ELECTRIC 12 Months
OPERATING STATISTICS Ended December 31
----------------------------
(Unaudited) 2002 2001
- -------------------------------------- ----------- -----------
As Restated
-----------
ELECTRIC OPERATING REVENUES (Thousands):
Residential $ 108,123 $ 96,274
Commercial 80,620 74,759
Industrial 90,370 82,523
Miscellaneous Revenue 5,040 6,261
----------- -----------
Total Retail 284,153 259,817
Wholesale 323,963 121,416
----------- -----------
$ 608,116 $ 381,233
=========== ===========
ELECTRIC MARGIN (Thousands):
Operating Revenues $ 608,116 $ 381,233
Cost of Fuel & Purchased Power 377,886 161,329
----------- -----------
Margin $ 230,230 $ 219,904
=========== ===========
ELECTRICITY SOLD (MWh):
Residential 1,567,215 1,411,262
Commercial 1,467,780 1,383,355
Industrial 2,516,335 2,426,756
Miscellaneous Sales 18,117 19,166
----------- -----------
Total Retail 5,569,447 5,240,539
Firm Wholesale 617,685 547,705
Non-Firm Wholesale 10,711,614 3,350,526
----------- -----------
16,898,746 9,138,770
=========== ===========
YEAR END ELECTRIC CUSTOMERS:
Residential 116,979 115,770
Commercial 16,881 17,327
Industrial 174 174
All Others 23 23
----------- -----------
134,057 133,294
=========== ===========
WEATHER AS A PERCENT OF NORMAL:
Heating Degree Days 97% 91%
Cooling Degree Days 123% 97%