UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 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 September 30, 2003
[ ] 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 its charter;
Commission State of Incorporation; IRS Employer
File Number Address and Telephone Number Identification No.
----------- ---------------------------- ------------------
1-14756 Ameren Corporation 43-1723446
(Missouri Corporation)
1901 Chouteau Avenue
St. Louis, Missouri 63103
(314) 621-3222
1-2967 Union Electric Company 43-0559760
(Missouri Corporation)
1901 Chouteau Avenue
St. Louis, Missouri 63103
(314) 621-3222
1-3672 Central Illinois Public Service Company 37-0211380
(Illinois Corporation)
607 East Adams Street
Springfield, Illinois 62739
(217) 523-3600
333-56594 Ameren Energy Generating Company 37-1395586
(Illinois Corporation)
1901 Chouteau Avenue
St. Louis, Missouri 63103
(314) 621-3222
2-95569 CILCORP Inc. 37-1169387
(Illinois Corporation)
300 Liberty Street
Peoria, Illinois 61602
(309) 677-5230
1-2732 Central Illinois Light Company 37-0211050
(Illinois Corporation)
300 Liberty Street
Peoria, Illinois 61602
(309) 677-5230
Indicate by check mark whether the registrants (1) have filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) have been subject to such
filing requirements for the past 90 days. Yes (X) No ( )
Indicate by check mark whether the registrants are accelerated filers (as
defined in Rule 12b-2 of the Securities Exchange Act of 1934).
Ameren Corporation Yes (X) No ( )
Union Electric Company Yes ( ) No (X)
Central Illinois Public Service Company Yes ( ) No (X)
Ameren Energy Generating Company Yes ( ) No (X)
CILCORP Inc. Yes ( ) No (X)
Central Illinois Light Company Yes ( ) No (X)
Number of shares outstanding of each of the registrant's classes of common stock
as of November 7, 2003:
Ameren Corporation Common stock, $.01 par value - 162,400,592
Union Electric Company Common stock, $5 par value, held by Ameren Corporation
(parent company of the registrant) -
102,123,834
Central Illinois Public Service Company Common stock, no par value, held by
Ameren Corporation (parent company of the registrant) -
25,452,373
Ameren Energy Generating Company Common stock, no par value, held by
Ameren Energy Development Company (parent company
of the registrant and indirect subsidiary of Ameren
Corporation) - 2,000
CILCORP Inc. Common stock, no par value, held by Ameren
Corporation (parent company of the registrant) -
1,000
Central Illinois Light Company Common stock, no par value, held by CILCORP
Inc. (parent company of the registrant and
subsidiary of Ameren Corporation) - 13,563,871
This combined Form 10-Q is separately filed by Ameren Corporation, Union
Electric Company, Central Illinois Public Service Company, Ameren Energy
Generating Company, CILCORP Inc. and Central Illinois Light Company. Each
registrant hereto is filing on its own behalf all of the information contained
in this quarterly report that relates to such registrant. Each registrant hereto
is not filing any information that does not relate to such registrant, and
therefore makes no representation as to any such information.
Prior to this quarterly report on Form 10-Q, separate filings were made by each
registrant, except CILCORP Inc. and Central Illinois Light Company, which made a
combined filing. Ameren Corporation and its subsidiaries switched to a combined
filing in order to improve disclosure and to simplify administrative processes.
OMISSION OF CERTAIN INFORMATION
Ameren Energy Generating Company meets the conditions set forth in General
Instruction H(1)(a) and (b) of Form 10-Q and is therefore filing this form with
the reduced disclosure format.
AMEREN CORPORATION
UNION ELECTRIC COMPANY
CENTRAL ILLINOIS PUBLIC SERVICE COMPANY
AMEREN ENERGY GENERATING COMPANY
CILCORP INC.
CENTRAL ILLINOIS LIGHT COMPANY
TABLE OF CONTENTS
Page
----
GLOSSARY OF TERMS AND ABBREVIATIONS...................................................................................... 3
PART I. Financial Information
ITEM 1. Financial Statements (Unaudited)
Ameren Corporation
Consolidated Balance Sheet.............................................................................. 6
Consolidated Statement of Income........................................................................ 7
Consolidated Statement of Cash Flows.................................................................... 8
Union Electric Company
Consolidated Balance Sheet.............................................................................. 9
Consolidated Statement of Income........................................................................ 10
Consolidated Statement of Cash Flows.................................................................... 11
Central Illinois Public Service Company
Balance Sheet........................................................................................... 12
Statement of Income..................................................................................... 13
Statement of Cash Flows................................................................................. 14
Ameren Energy Generating Company
Balance Sheet........................................................................................... 15
Statement of Income..................................................................................... 16
Statement of Cash Flows................................................................................. 17
CILCORP Inc.
Consolidated Balance Sheet.............................................................................. 18
Consolidated Statement of Income........................................................................ 19
Consolidated Statement of Cash Flows.................................................................... 20
1
Central Illinois Light Company
Consolidated Balance Sheet.............................................................................. 21
Consolidated Statement of Income........................................................................ 22
Consolidated Statement of Cash Flows.................................................................... 23
Combined Notes to Financial Statements.................................................................. 24
ITEM 2. Management's Discussion and Analysis of Financial Condition and Results of Operations................... 52
ITEM 3. Quantitative and Qualitative Disclosures About Market Risk.............................................. 71
ITEM 4. Controls and Procedures................................................................................. 75
Forward-Looking Statements.............................................................................. 75
PART II. Other Information
ITEM 1. Legal Proceedings....................................................................................... 77
ITEM 6. Exhibits and Reports on Form 8-K........................................................................ 77
SIGNATURES................................................................................................................ 80
This Form 10-Q contains "forward-looking statements" within the meaning of
Section 21E of the Securities Exchange Act of 1934. Forward-looking statements
should be read with the cautionary statements and important factors included in
this Form 10-Q at Part I under the heading "Forward-Looking Statements."
Forward-looking statements are all statements other than statements of
historical fact, including those statements that are identified by the use of
the words "anticipates," "estimates," "expects," "intends," "plans," "predicts,"
"projects," and similar expressions.
2
GLOSSARY OF TERMS AND ABBREVIATIONS
AERG - AmerenEnergy Resources Generating Company, a non rate-regulated
subsidiary of CILCO, which was formerly known as Central Illinois Generation,
Inc.
AES - The AES Corporation.
AFS - Ameren Energy Fuels and Services Company, a subsidiary of Resources
Company, which procures fuel and gas and manages the related risks for the
Ameren Companies.
Ameren - Ameren Corporation and its subsidiaries on a consolidated basis. When
referring to financing or acquisition activities, Ameren is defined as Ameren
Corporation, the parent.
Ameren Companies - The individual registrants within the Ameren consolidated
group.
Ameren Energy - Ameren Energy, Inc., a subsidiary of Ameren Corporation, which
serves as a power marketing and risk management agent for the Ameren Companies
for transactions of primarily less than one year.
Ameren Services - Ameren Services Company, a subsidiary of Ameren Corporation,
which provides a variety of support services to Ameren and its subsidiaries.
ARB - Accounting Research Bulletin.
CERCLA (Superfund) - Comprehensive Environmental Response Compensation Liability
Act of 1980, which is federal environmental legislation that addresses
remediation of contaminated sites.
CESI - CILCORP Energy Services, Inc., a subsidiary of CILCORP, which operates
gas management services that include commodity procurement and re-delivery to
retail customers.
CILCORP - CILCORP Inc., a subsidiary of Ameren Corporation, which operates as a
holding company for CILCO.
CILCO - Central Illinois Light Company, a subsidiary of CILCORP, which operates
a rate-regulated transmission and distribution business, an electric generation
business, and a rate-regulated natural gas distribution business in Illinois as
AmerenCILCO.
CIPS - Central Illinois Public Service Company, a subsidiary of Ameren
Corporation, which operates a rate-regulated electric and natural gas
transmission and distribution business in Illinois as AmerenCIPS.
Development Company - Ameren Energy Development Company, a subsidiary of
Resources Company, which develops and constructs generating facilities for
Genco.
DOJ - Department of Justice, a governmental agency of the United States of
America.
EEI - Electric Energy, Inc., a 60%-owned subsidiary of Ameren, which is 40%
owned by UE and 20% owned by Resources Company.
EITF - Emerging Issues Task Force, an organization that is designed to assist
the FASB in improving financial reporting through the identification, discussion
and resolution of financial issues within the framework of existing
authoritative literature.
EPA - Environmental Protection Agency, a governmental agency of the United
States of America.
ERISA - Employee Retirement Income Security Act of 1974.
3
Exchange Act - Securities Exchange Act of 1934, as amended.
FASB - Financial Accounting Standards Board, a rulemaking organization that
establishes financial accounting and reporting standards in the United States of
America.
FERC - Federal Energy Regulatory Commission, the governmental agency of the
United States of America that, among other things, regulates interstate
transmission and wholesale sales of electricity and gas and related matters.
FIN - FASB Interpretation, intended to clarify accounting pronouncements
previously issued by the FASB.
GAAP - Generally accepted accounting principles in the United States of America.
Genco - Ameren Energy Generating Company, a subsidiary of Development Company,
which operates a non rate-regulated electric generation business in Illinois and
Missouri.
GridAmerica Companies - UE, CIPS, American Transmission Systems Incorporated, a
subsidiary of FirstEnergy Corporation, and Northern Indiana Public Service
Company, a subsidiary of NiSource, Inc.
IBEW - International Brotherhood of Electrical Workers.
ICC - Illinois Commerce Commission, a state agency that regulates the Illinois
utility businesses and operations of UE, CIPS and CILCO.
ITC - Independent Transmission Company.
IUOE - International Union of Operating Engineers.
LIBOR - London Interbank Offered Rate.
MAIN - Mid-America Interconnected Network, one of the regional electric
reliability councils organized for coordinating the planning and operation of
the nation's bulk power supply.
Marketing Company - Ameren Energy Marketing Company, a subsidiary of Resources
Company, which markets power for periods primarily over one year.
Medina Valley - AmerenEnergy Medina Valley Cogen (No. 4), LLC and its
subsidiaries, subsidiaries of Resources Company, which indirectly owns a 40
megawatt, gas-fired electric generation plant.
Midwest ISO - Midwest Independent System Operator.
MoPSC - Missouri Public Service Commission, a state agency that regulates the
Missouri utility business and operations of UE.
NOPR - Notice of Proposed Rulemaking issued by the FERC.
NRG - NRG Energy, Inc.
NSR - New Source Review programs under the federal Clean Air Act.
NYMEX - New York Mercantile Exchange.
OATT - Open Access Transmission Tariff.
OCI - Other Comprehensive Income (Loss) as defined by GAAP.
4
PGA - Purchased Gas Adjustment tariff, which impacts UE, CIPS and CILCO natural
gas utility customers.
PUHCA - Public Utility Holding Company Act of 1935.
Resources Company - Ameren Energy Resources Company, a subsidiary of Ameren
Corporation, which consists of non rate-regulated operations, including Genco,
Development Company, Marketing Company and AFS.
RRO - Regional Reliability Organization.
RTO - Regional Transmission Organization.
SEC - Securities and Exchange Commission, a governmental agency of the United
States of America.
SFAS - Statement of Financial Accounting Standards, the accounting and financial
reporting rules issued by the FASB.
UE - Union Electric Company, a subsidiary of Ameren Corporation, which operates
a rate-regulated electric generation, transmission and distribution business,
and a rate-regulated natural gas distribution business in Missouri and Illinois
as AmerenUE.
5
PART I. FINANCIAL INFORMATION
ITEM 1. Financial Statements.
AMEREN CORPORATION
CONSOLIDATED BALANCE SHEET
(Unaudited) (In millions, except per share amounts)
September 30, December 31,
2003 2002
------------ -----------
ASSETS
Current Assets:
Cash and cash equivalents $ 100 $ 628
Accounts receivables - trade (less allowance for doubtful
accounts of $9 and $7, respectively) 362 266
Unbilled revenue 184 176
Miscellaneous accounts and notes receivable 131 44
Materials and supplies, at average cost 476 299
Other current assets 57 39
-------- --------
Total current assets 1,310 1,452
-------- --------
Property and Plant, Net 10,152 8,840
Investments and Other Non-Current Assets:
Investments 166 38
Nuclear decommissioning trust fund 195 172
Goodwill and other intangibles, net 630 -
Other assets 317 307
-------- --------
Total investments and other non-current assets 1,308 517
-------- --------
Regulatory Assets 767 690
-------- --------
TOTAL ASSETS $ 13,537 $ 11,499
======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Current maturities of long-term debt $ 499 $ 339
Short-term debt 3 271
Accounts and wages payable 275 369
Taxes accrued 231 45
Other current liabilities 241 177
-------- --------
Total current liabilities 1,249 1,201
-------- --------
Long-term Debt, Net 4,046 3,433
Preferred Stock of Subsidiary Subject to Mandatory Redemption 21 -
Deferred Credits and Other Non-Current Liabilities:
Accumulated deferred income taxes, net 1,993 1,707
Accumulated deferred investment tax credits 153 149
Regulatory liabilities 133 136
Asset retirement obligations 408 174
Accrued pension liabilities 527 377
Other deferred credits and liabilities 439 272
-------- --------
Total deferred credits and other non-current liabilities 3,653 2,815
-------- --------
Preferred Stock of Subsidiaries Not Subject to Mandatory Redemption 213 193
Minority Interest in Consolidated Subsidiaries 21 15
Commitments and Contingencies (Note 8)
Stockholders' Equity:
Common stock, $.01 par value, 400.0 shares authorized -
shares outstanding of 162.3 and 154.1, respectively 2 2
Other paid-in capital, principally premium on common stock 2,528 2,203
Retained earnings 1,917 1,739
Accumulated other comprehensive income (loss) (103) (93)
Other (10) (9)
-------- --------
Total stockholders' equity 4,334 3,842
-------- --------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 13,537 $ 11,499
======== ========
The accompanying notes are an integral part of these consolidated financial
statements.
6
AMEREN CORPORATION
CONSOLIDATED STATEMENT OF INCOME
(Unaudited) (In millions, except per share amounts)
Three Months Ended Nine Months Ended
September 30, September 30,
-------------------------- --------------------------
2003 2002 2003 2002
------------ ------------- ------------- ------------
Operating Revenues:
Electric $ 1,266 $ 1,135 $ 3,090 $ 2,812
Gas 82 30 450 202
Other 2 1 6 4
----------- ---------- ----------- -----------
Total operating revenues 1,350 1,166 3,546 3,018
----------- ---------- ----------- -----------
Operating Expenses:
Fuel and purchased power 330 248 793 655
Gas purchased for resale 54 17 326 129
Other operations and maintenance 302 278 901 835
Coal contract settlement (51) - (51) -
Depreciation and amortization 132 108 388 321
Taxes other than income taxes 83 74 238 211
----------- ---------- ----------- -----------
Total operating expenses 850 725 2,595 2,151
----------- ---------- ----------- -----------
Operating Income 500 441 951 867
Other Income and (Deductions):
Miscellaneous income 4 6 16 16
Miscellaneous expense (3) (3) (14) (46)
----------- ---------- ----------- -----------
Total other income and (deductions) 1 3 2 (30)
----------- ---------- ----------- -----------
Interest Charges and Preferred Dividends:
Interest 69 56 204 158
Preferred dividends of subsidiaries 3 3 8 9
----------- ---------- ----------- -----------
Net interest charges and preferred dividends 72 59 212 167
----------- ---------- ----------- -----------
Income Before Income Taxes and Cumulative Effect of Change
in Accounting Principle 429 385 741 670
Income Taxes 154 145 273 256
----------- ---------- ----------- -----------
Income Before Cumulative Effect of Change in Accounting
Principle 275 240 468 414
Cumulative Effect of Change in Accounting Principle,
Net of Income Taxes - - 18 -
----------- ---------- ----------- -----------
Net Income $ 275 $ 240 $ 486 $ 414
=========== ========== =========== ===========
Earnings per Common Share - Basic:
Income before cumulative effect of change
in accounting principle $ 1.70 $ 1.64 $ 2.91 $ 2.88
Cumulative effect of change in accounting
principle, net of income taxes - - 0.11 -
------------ ----------- ----------- -----------
Net income $ 1.70 $ 1.64 $ 3.02 $ 2.88
============ =========== =========== ===========
Earnings per Common Share - Diluted:
Income before cumulative effect of change
in accounting principle $ 1.70 $ 1.63 $ 2.91 $ 2.87
Cumulative effect of change in accounting
principle, net of income taxes - - 0.11 -
----------- ----------- ----------- -----------
Net income $ 1.70 $ 1.63 $ 3.02 $ 2.87
=========== =========== =========== ===========
Dividends per Common Share $ 0.635 $ 0.635 $ 1.905 $ 1.905
Average Common Shares Outstanding 161.8 146.7 160.7 143.6
The accompanying notes are an integral part of these consolidated financial
statements.
7
AMEREN CORPORATION
CONSOLIDATED STATEMENT OF CASH FLOWS
(Unaudited) (In millions)
Nine Months Ended
September 30,
---------------------
2003 2002
---------- ---------
Cash Flows From Operating Activities:
Net income $ 486 $ 414
Adjustments to reconcile net income to net cash
provided by operating activities:
Cumulative effect of change in accounting principle (18) -
Depreciation and amortization 388 321
Amortization of nuclear fuel 25 25
Amortization of debt issuance costs and premium/discounts 8 6
Deferred income taxes, net 30 11
Deferred investment tax credits, net (9) (6)
Coal contract settlement (45) -
Other (8) 5
Changes in assets and liabilities, excluding the effects of the acquisitions:
Receivables, net 17 (49)
Materials and supplies (69) 15
Accounts and wages payable (171) (217)
Taxes accrued 167 214
Assets, other (8) (23)
Liabilities, other 59 17
------ ------
Net cash provided by operating activities 852 733
------ ------
Cash Flows From Investing Activities:
Construction expenditures (457) (565)
Acquisitions, net of cash acquired (489) -
Nuclear fuel expenditures (2) (25)
Other 10 8
------ ------
Net cash used in investing activities (938) (582)
------ ------
Cash Flows From Financing Activities:
Dividends on common stock (308) (279)
Capital issuance costs (13) (35)
Redemptions, repurchases, and maturities:
Nuclear fuel lease (38) -
Short-term debt (268) (635)
Long-term debt (648) (158)
Preferred stock (1) (41)
Issuances:
Common stock 336 635
Nuclear fuel lease - 31
Long-term debt 498 893
------ ------
Net cash provided by (used in) financing activities (442) 411
------ ------
Net change in cash and cash equivalents (528) 562
Cash and cash equivalents at beginning of year 628 67
------ ------
Cash and cash equivalents at end of period $ 100 $ 629
====== ======
Cash Paid During the Periods:
Interest $ 189 $ 142
Income taxes, net 156 111
The accompanying notes are an integral part of these consolidated financial
statements.
8
UNION ELECTRIC COMPANY
CONSOLIDATED BALANCE SHEET
(Unaudited) (In millions, except per share amounts)
September 30, December 31,
2003 2002
------------- ------------
ASSETS
Current Assets:
Cash and cash equivalents $ 15 $ 9
Accounts receivable - trade (less allowance for doubtful
accounts of $6 and $6, respectively) 222 171
Unbilled revenue 98 101
Miscellaneous accounts and notes receivable 126 49
Materials and supplies, at average cost 182 162
Other current assets 29 26
-------- --------
Total current assets 672 518
-------- --------
Property and Plant, Net 6,070 5,991
Investments and Other Non-Current Assets:
Nuclear decommissioning trust fund 195 172
Other assets 241 235
-------- --------
Total investments and other non-current assets 436 407
-------- --------
Regulatory Assets 724 659
-------- --------
TOTAL ASSETS $ 7,902 $ 7,575
======== ========
LIABILITIES AND STOCKHOLDER'S EQUITY
Current Liabilities:
Current maturities of long-term debt $ 235 $ 130
Short-term debt - 250
Borrowings from money pool 230 15
Accounts and wages payable 164 348
Taxes accrued 213 118
Other current liabilities 97 96
-------- --------
Total current liabilities 939 957
-------- --------
Long-term Debt, Net 1,678 1,687
Deferred Credits and Other Non-Current Liabilities:
Accumulated deferred income taxes, net 1,304 1,344
Accumulated deferred investment tax credits 116 121
Regulatory liabilities 102 121
Asset retirement obligations 403 174
Accrued pension liabilities 261 252
Other deferred credits and liabilities 185 174
-------- --------
Total deferred credits and other non-current liabilities 2,371 2,186
-------- --------
Commitments and Contingencies (Note 8)
Stockholder's Equity:
Common stock, $5 par value, 150.0 shares authorized - 102.1 shares outstanding 511 511
Preferred stock not subject to mandatory redemption 113 113
Other paid-in capital, principally premium on common stock 702 702
Retained earnings 1,649 1,477
Accumulated other comprehensive income (loss) (61) (58)
-------- --------
Total stockholder's equity 2,914 2,745
-------- --------
TOTAL LIABILITIES AND STOCKHOLDER'S EQUITY $ 7,902 $ 7,575
======== ========
The accompanying notes as they relate to UE are an integral part of these
consolidated financial statements.
9
UNION ELECTRIC COMPANY
CONSOLIDATED STATEMENT OF INCOME
(Unaudited) (In millions)
Three Months Ended Nine Months Ended
September 30, September 30,
--------------------- --------------------
2003 2002 2003 2002
------- ------- ------- ---------
Operating Revenues:
Electric $ 801 $ 841 $ 1,972 $ 2,029
Gas 15 12 100 80
------- ------- ------- -------
Total operating revenues 816 853 2,072 2,109
------- ------- ------- -------
Operating Expenses:
Fuel and purchased power 153 157 418 433
Gas purchased for resale 10 7 62 49
Other operations and maintenance 192 201 564 592
Coal contract settlement (51) - (51) -
Depreciation and amortization 71 70 212 211
Taxes other than income taxes 61 67 168 174
------- ------- ------- -------
Total operating expenses 436 502 1,373 1,459
------- ------- ------- -------
Operating Income 380 351 699 650
Other Income and (Deductions):
Miscellaneous income 5 2 14 27
Miscellaneous expense (2) (1) (5) (32)
------- ------- ------- -------
Total other income and (deductions) 3 1 9 (5)
------- ------- ------- -------
Interest Charges 23 26 74 78
------- ------- ------- -------
Income Before Income Taxes 360 326 634 567
Income Taxes 135 120 234 203
------- ------- ------- -------
Net Income 225 206 400 364
Preferred Stock Dividends 1 2 4 6
------- ------- ------- -------
Net Income Available to Common Stockholder $ 224 $ 204 $ 396 $ 358
======= ======= ======= =======
The accompanying notes as they relate to UE are an integral part of these
consolidated financial statements.
10
UNION ELECTRIC COMPANY
CONSOLIDATED STATEMENT OF CASH FLOWS
(Unaudited) (In millions)
Nine Months Ended
September 30,
---------------------
2003 2002
-------- ---------
Cash Flows From Operating Activities:
Net income $ 400 $ 364
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization 212 211
Amortization of nuclear fuel 25 25
Amortization of debt issuance costs and premium/discounts 3 3
Deferred income taxes, net 16 7
Deferred investment tax credits, net (5) (5)
Coal contract settlement (45) -
Other (3) 3
Changes in assets and liabilities:
Receivables, net (38) (41)
Materials and supplies (20) (7)
Accounts and wages payable (147) (169)
Taxes accrued 95 207
Assets, other (46) (21)
Liabilities, other 39 (18)
------- -------
Net cash provided by operating activities 486 559
------- -------
Cash Flows From Investing Activities:
Construction expenditures (310) (357)
Nuclear fuel expenditures (2) (25)
Advances to money pool - 84
Other 4 7
------- -------
Net cash used in investing activities (308) (291)
------- -------
Cash Flows From Financing Activities:
Dividends on common stock (224) (224)
Dividends on preferred stock (4) (6)
Capital issuance costs (5) (1)
Redemptions, repurchases, and maturities:
Nuclear fuel lease (38) -
Short-term debt (250) (186)
Long-term debt (364) (125)
Preferred stock - (41)
Issuances:
Nuclear fuel lease - 31
Long-term debt 498 173
Borrowings from money pool 215 109
------- -------
Net cash used in financing activities (172) (270)
------- -------
Net change in cash and cash equivalents 6 (2)
Cash and cash equivalents at beginning of year 9 15
------- -------
Cash and cash equivalents at end of period $ 15 $ 13
======= =======
Cash Paid During the Periods:
Interest $ 78 $ 70
Income taxes, net 199 62
The accompanying notes as they relate to UE are an integral part of these
consolidated financial statements.
11
CENTRAL ILLINOIS PUBLIC SERVICE COMPANY
BALANCE SHEET
(Unaudited) (In millions)
September 30, December 31,
2003 2002
------------ -----------
ASSETS
Current Assets:
Cash and cash equivalents $ 17 $ 17
Accounts receivable - trade (less allowance for doubtful
accounts of $1 and $1, respectively) 50 53
Unbilled revenue 59 74
Advances to money pool - 16
Miscellaneous accounts and notes receivable 22 22
Current portion of intercompany note receivable - Genco 49 46
Current portion of intercompany tax receivable - Genco 13 13
Materials and supplies, at average cost 57 41
Other current assets 7 7
-------- -------
Total current assets 274 289
-------- -------
Property and Plant, Net 823 825
Investments and Other Non-Current Assets:
Intercompany note receivable - Genco 324 373
Intercompany tax receivable - Genco 153 162
Other assets 18 17
-------- -------
Total investments and other non-current assets 495 552
-------- -------
Regulatory Assets 28 31
-------- -------
TOTAL ASSETS $ 1,620 $ 1,697
======== =======
LIABILITIES AND STOCKHOLDER'S EQUITY
Current Liabilities:
Current maturities of long-term debt $ - $ 45
Accounts and wages payable 110 87
Borrowings from money pool 23 -
Taxes accrued 34 32
Other current liabilities 29 26
-------- -------
Total current liabilities 196 190
-------- -------
Long-term Debt, Net 485 534
Deferred Credits and Other Non-Current Liabilities:
Accumulated deferred income taxes, net 271 282
Accumulated deferred investment tax credits 12 13
Regulatory liabilities 14 15
Other deferred credits and liabilities 78 71
-------- -------
Total deferred credits and other non-current liabilities 375 381
-------- -------
Commitments and Contingencies (Note 8)
Stockholder's Equity:
Common stock, no par value, 45.0 shares authorized - 25.5 shares outstanding 120 120
Preferred stock not subject to mandatory redemption 80 80
Retained earnings 380 405
Accumulated other comprehensive income (loss) (16) (13)
-------- -------
Total stockholder's equity 564 592
-------- -------
TOTAL LIABILITIES AND STOCKHOLDER'S EQUITY $ 1,620 $ 1,697
======== =======
The accompanying notes as they relate to CIPS are an integral part of these
financial statements.
12
CENTRAL ILLINOIS PUBLIC SERVICE COMPANY
STATEMENT OF INCOME
(Unaudited) (In millions)
Three Months Ended Nine Months Ended
September 30, September 30,
---------------- ------------------
2003 2002 2003 2002
------- ------- -------- --------
Operating Revenues:
Electric $ 176 $ 209 $ 445 $ 520
Gas 20 15 127 106
----- ----- ----- -----
Total operating revenues 196 224 572 626
----- ----- ----- -----
Operating Expenses:
Purchased power 96 117 264 323
Gas purchased for resale 9 6 80 62
Other operations and maintenance 41 39 121 120
Depreciation and amortization 13 13 39 38
Taxes other than income taxes 6 6 22 21
----- ----- ----- -----
Total operating expenses 165 181 526 564
----- ----- ----- -----
Operating Income 31 43 46 62
Other Income and (Deductions):
Miscellaneous income 7 8 21 25
Miscellaneous expense - - (2) (1)
----- ----- ----- -----
Total other income and (deductions) 7 8 19 24
----- ----- ----- -----
Interest Charges 8 11 26 31
----- ----- ----- -----
Income Before Income Taxes 30 40 39 55
Income Taxes 4 16 8 21
----- ----- ----- -----
Net Income 26 24 31 34
Preferred Stock Dividends 1 1 2 3
----- ----- ----- -----
Net Income Available to Common Stockholder $ 25 $ 23 $ 29 $ 31
===== ===== ===== =====
The accompanying notes as they relate to CIPS are an integral part of these
financial statements.
13
CENTRAL ILLINOIS PUBLIC SERVICE COMPANY
STATEMENT OF CASH FLOWS
(Unaudited) (In millions)
Nine Months Ended
September 30,
----------------------------
2003 2002
----------- -----------
Cash Flows From Operating Activities:
Net income $ 31 $ 34
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization 39 38
Amortization of debt issuance costs and premium/discounts 1 1
Deferred income taxes, net (11) (12)
Deferred investment tax credits, net (1) (1)
Other (3) -
Changes in assets and liabilities:
Receivables, net 18 (4)
Materials and supplies (16) (1)
Accounts and wages payable 23 (36)
Taxes accrued 2 28
Assets, other 9 25
Liabilities, other 10 (1)
-------- --------
Net cash provided by operating activities 102 71
-------- --------
Cash Flows From Investing Activities:
Construction expenditures (36) (41)
Advances to money pool 62 43
-------- --------
Net cash provided by investing activities 26 2
-------- --------
Cash Flows From Financing Activities:
Dividends on common stock (54) (47)
Dividends on preferred stock (2) (3)
Redemptions, repurchases, and maturities:
Long-term debt (95) (33)
Issuances:
Borrowings from money pool 23 -
-------- --------
Net cash used in financing activities (128) (83)
-------- --------
Net change in cash and cash equivalents - (10)
Cash and cash equivalents at beginning of year 17 26
-------- --------
Cash and cash equivalents at end of period $ 17 $ 16
======== ========
Cash Paid During the Periods:
Interest $ 23 $ 26
Income taxes, net 18 6
The accompanying notes as they relate to CIPS are an integral part of these
financial statements.
14
AMEREN ENERGY GENERATING COMPANY
BALANCE SHEET
(Unaudited) (In millions, except shares)
September 30, December 31,
2003 2002
------------ ------------
ASSETS
Current Assets:
Cash and cash equivalents $ 2 $ 3
Accounts receivable 143 78
Miscellaneous accounts and notes receivable - 71
Materials and supplies, at average cost 95 77
Other current assets 4 2
-------- --------
Total current assets 244 231
Property and Plant, Net 1,766 1,767
Other Non-Current Assets 13 12
-------- --------
TOTAL ASSETS $ 2,023 $ 2,010
======== ========
LIABILITIES AND STOCKHOLDER'S EQUITY
Current Liabilities:
Accounts and wages payable $ 70 $ 87
Borrowings from money pool 177 191
Current portion of intercompany notes payable - CIPS and Ameren 53 50
Current portion of intercompany tax payable - CIPS 13 13
Other current liabilities 41 17
-------- --------
Total current liabilities 354 358
-------- --------
Long-term Debt, Net 698 698
Intercompany Notes Payable - CIPS and Ameren 358 412
Deferred Credits and Other Non-Current Liabilities:
Accumulated deferred income taxes, net 104 66
Accumulated deferred investment tax credits 14 15
Intercompany tax payable - CIPS 153 162
Other deferred credits and liabilities 20 19
-------- --------
Total deferred credits and other non-current liabilities 291 262
-------- --------
Commitments and Contingencies (Note 8)
Stockholder's Equity:
Common stock, no par value, 10,000 shares authorized - 2,000 shares outstanding - -
Other paid-in capital 150 150
Retained earnings 174 131
Accumulated other comprehensive income (loss) (2) (1)
-------- --------
Total stockholder's equity 322 280
-------- --------
TOTAL LIABILITIES AND STOCKHOLDER'S EQUITY $ 2,023 $ 2,010
======== ========
The accompanying notes as they relate to Genco are an integral part of these
financial statements.
15
AMEREN ENERGY GENERATING COMPANY
STATEMENT OF INCOME
(Unaudited) (In millions)
Three Months Ended Nine Months Ended
September 30, September 30,
------------------------- -------------------------
2003 2002 2003 2002
----------- ------------ ------------ ------------
Operating Revenues:
Electric $ 216 $ 207 $ 594 $ 560
Other 1 - 2 -
-------- ------- ------- -------
Total operating revenues 217 207 596 560
-------- ------- ------- -------
Operating Expenses:
Fuel and purchased power 102 101 263 259
Other operations and maintenance 38 38 108 122
Depreciation and amortization 19 17 56 50
Taxes other than income taxes 5 2 18 14
-------- ------- ------- -------
Total operating expenses 164 158 445 445
-------- ------- ------- -------
Operating Income 53 49 151 115
Other Income and (Deductions):
Miscellaneous income - - 2 -
Miscellaneous expense - (1) - (1)
-------- ------- ------- --------
Total other income and (deductions) - (1) 2 (1)
-------- ------- ------- --------
Interest Charges 25 23 76 63
-------- ------- ------- --------
Income Before Income Taxes and Cumulative Effect of
Change in Accounting Principle 28 25 77 51
Income Taxes 11 10 30 20
-------- ------- ------- -------
Income Before Cumulative Effect of Change in Accounting
Principle 17 15 47 31
Cumulative Effect of Change in Accounting Principle,
Net of Income Taxes - - 18 -
-------- ------- ------- -------
Net Income $ 17 $ 15 $ 65 $ 31
======== ======= ======= =======
The accompanying notes as they relate to Genco are an integral part of these
financial statements.
16
AMEREN ENERGY GENERATING COMPANY
STATEMENT OF CASH FLOWS
(Unaudited) (In millions)
Nine Months Ended
September 30,
-----------------
2003 2002
------- -------
Cash Flows From Operating Activities:
Net income $ 65 $ 31
Adjustments to reconcile net income to net cash
provided by operating activities:
Cumulative effect of change in accounting principle (18) -
Amortization of debt issuance costs and discounts 1 1
Depreciation and amortization 56 50
Deferred income taxes, net 37 20
Deferred investment tax credits, net (1) (1)
Other (1) -
Changes in assets and liabilities:
Accounts receivable (63) 43
Materials and supplies (18) 3
Taxes receivable, net 64 (12)
Accounts and wages payable (4) 15
Assets, other (1) (17)
Liabilities, other 8 17
----- -----
Net cash provided by operating activities 125 150
----- -----
Cash Flows From Investing Activities:
Construction expenditures (39) (268)
Advances to money pool - (32)
----- -----
Net cash used in investing activities (39) (300)
----- -----
Cash Flows From Financing Activities:
Dividends on common stock (22) (12)
Debt issuance costs - (4)
Redemptions, repurchases, and maturities:
Borrowings from money pool (14) (62)
Intercompany notes payable - CIPS and Ameren (51) (46)
Issuances:
Long-term debt - 275
----- -----
Net cash provided by (used in) financing activities (87) 151
----- -----
Net change in cash and cash equivalents (1) 1
Cash and cash equivalents at beginning of year 3 2
----- -----
Cash and cash equivalents at end of period $ 2 $ 3
===== =====
Cash Paid During the Periods:
Interest $ 60 $ 44
Income taxes (refunded) paid (66) 4
The accompanying notes as they relate to Genco are an integral part of these
financial statements.
17
CILCORP INC.
CONSOLIDATED BALANCE SHEET
(Unaudited) (In millions)
September 30, | December 31,
2003 | 2002
------------ | --------------
Successor | Predecessor
------------ | --------------
ASSETS |
|
Current Assets: |
Cash and cash equivalents $ 9 | $ 32
Accounts receivables - trade (less allowance for doubtful |
accounts of $3 and $2, respectively) 51 | 53
Unbilled revenue 23 | 37
Miscellaneous accounts and notes receivable 8 | 8
Materials and supplies, at average cost 123 | 61
Other current assets 7 | 24
------- | -------
Total current assets 221 | 215
------- | -------
Property and Plant, Net 1,188 | 914
Investments and Other Non-Current Assets: |
Investments 130 | 133
Goodwill and other intangibles, net 629 | 581
Other assets 23 | 50
------- | -------
Total investments and other non-current assets 782 | 764
------- | -------
Regulatory Assets 15 | 8
------- | -------
TOTAL ASSETS $ 2,206 | $ 1,901
======= | =======
|
|
LIABILITIES AND STOCKHOLDER'S EQUITY |
Current Liabilities: |
Current maturities of long-term debt $ 100 | $ 27
Short-term debt - | 10
Borrowings from money pool 109 | -
Intercompany note payable - Ameren 31 | -
Accounts and wages payable 88 | 76
Taxes accrued 4 | 8
Other current liabilities 48 | 40
------- | -------
Total current liabilities 380 | 161
------- | -------
Long-term Debt, Net 671 | 791
Preferred Stock of Subsidiary Subject to Mandatory Redemption 21 | -
Deferred Credits and Other Non-Current Liabilities: |
Accumulated deferred income taxes, net 306 | 190
Accumulated deferred investment tax credits 12 | 13
Regulatory liabilities 17 | 19
Accrued pension liabilities 133 | 107
Other deferred credits and liabilities 158 | 84
------- | -------
Total deferred credits and other non-current liabilities 626 | 413
------- | -------
Preferred Stock of Subsidiary Subject to Mandatory Redemption - | 22
Preferred Stock of Subsidiary Not Subject to Mandatory Redemption 19 | 19
Commitments and Contingencies (Note 8) |
Stockholder's Equity: |
Other paid-in capital 489 | 519
Retained earnings 4 | 35
Accumulated other comprehensive income (loss) (4) | (59)
------- | -------
Total stockholder's equity 489 | 495
------- | -------
TOTAL LIABILITIES AND STOCKHOLDER'S EQUITY $ 2,206 | $ 1,901
======= | =======
|
|
The accompanying notes as they relate to CILCORP are an integral part of these |
consolidated financial statements. |
18
CILCORP INC.
CONSOLIDATED STATEMENT OF INCOME
(Unaudited) (In millions)
----------Successor--------- | ----------------Predecessor----------------
Three Eight | Three Nine
Months Months | Months Months
Ended Ended | Ended Ended
September 30, September 30,| January September 30, September 30,
-------------- ------------ | ----------- --------------- -------------
2003 2003 | 2003 2002 2002
-------------- ------------ | ----------- -------------- -------------
|
Operating Revenues: |
Electric $ 168 $ 373 | $ 47 $ 167 $ 396
Gas 46 215 | 58 37 185
Other 1 3 | - 1 4
----------- ----------- | ----------- ----------- -----------
Total operating revenues 215 591 | 105 205 585
----------- ----------- | ----------- ----------- -----------
|
Operating Expenses: |
Fuel and purchased power 85 192 | 24 70 180
Gas purchased for resale 32 166 | 44 24 126
Other operations and maintenance 38 95 | 14 30 101
Depreciation and amortization 18 54 | 6 18 54
Taxes other than income taxes 9 26 | 4 10 31
----------- ----------- | ----------- ----------- -----------
Total operating expenses 182 533 | 92 152 492
----------- ----------- | ----------- ----------- -----------
|
Operating Income 33 58 | 13 53 93
|
Other Income and (Deductions): |
Miscellaneous income - - | - - 2
Miscellaneous expense (2) (3) | - - (2)
----------- ----------- | ----------- ----------- -----------
Total other income and (deductions) (2) (3) | - - -
----------- ----------- | ----------- ----------- -----------
Interest Charges and Preferred Dividends: |
Interest 15 35 | 5 16 48
Preferred dividends of subsidiaries - 1 | - 1 2
----------- ----------- | ----------- ----------- -----------
Net interest charges and preferred dividends 15 36 | 5 17 50
----------- ----------- | ----------- ----------- -----------
|
Income Before Income Taxes and Cumulative Effect of |
Change in Accounting Principle 16 19 | 8 36 43
|
Income Taxes 5 5 | 3 13 14
----------- ----------- | ----------- ----------- -----------
|
Income Before Cumulative Effect of Change in |
Accounting Principle 11 14 | 5 23 29
|
Cumulative Effect of Change in Accounting Principle, |
Net of Income Taxes - - | 4 - -
----------- ----------- | ----------- ----------- -----------
|
Net Income $ 11 $ 14 | $ 9 $ 23 $ 29
=========== =========== | =========== =========== ===========
|
|
The accompanying notes as they relate to CILCORP are an integral part of these |
consolidated financial statements. |
19
CILCORP INC.
CONSOLIDATED STATEMENT OF CASH FLOWS
(Unaudited) (In millions)
---Successor-- | ---------Predecessor-------
Eight | Nine
Months | Months
Ended | Ended
September 30, | January September 30,
-------------- | ----------- --------------
2003 | 2003 2002
-------------- | ----------- --------------
|
Cash Flows From Operating Activities: |
Net income $ 14 | $ 9 $ 29
Adjustments to reconcile net income to net cash |
provided by operating activities: |
Cumulative effect of change in accounting principle - | (4) -
Depreciation and amortization 54 | 6 54
Amortization of debt issuance costs and premium/discounts 1 | - -
Deferred income taxes, net (5) | (5) 2
Deferred investment tax credits, net (1) | - (2)
Other (9) | - 6
Changes in assets and liabilities: |
Receivables, net 36 | (20) 4
Materials and supplies (18) | 13 4
Accounts and wages payable (37) | 20 (15)
Taxes accrued (3) | 11 8
Assets, other 5 | 6 4
Liabilities, other 7 | (5) 2
------- | ------- -------
Net cash provided by operating activities 44 | 31 96
------- | ------- -------
|
Cash Flows From Investing Activities: |
Construction expenditures (52) | (16) (96)
Other 3 | 1 3
------- | ------- -------
Net cash used in investing activities (49) | (15) (93)
------- | ------- -------
|
Cash Flows From Financing Activities: |
Dividends on common stock (10) | - -
Redemptions, repurchases, and maturities: |
Short-term debt - | (10) (63)
Long-term debt (153) | - (1)
Preferred stock (1) | - -
Issuances: |
Long-term debt - | - 100
Borrowings from money pool 109 | - -
Intercompany note payable - Ameren 31 | - -
------- | ------- -------
Net cash provided by (used in) financing activities (24) | (10) 36
------- | ------- -------
|
Net change in cash and cash equivalents (29) | 6 39
Cash and cash equivalents at beginning of year 38 | 32 18
------- | ------- -------
Cash and cash equivalents at end of period $ 9 | $ 38 $ 57
======= | ======= =======
|
Cash Paid During the Periods: |
Interest $ 14 | $ 5 $ 44
Income taxes, net 10 | - 5
|
|
The accompanying notes as they relate to CILCORP are an integral part of these |
consolidated financial statements. |
20
CENTRAL ILLINOIS LIGHT COMPANY
CONSOLIDATED BALANCE SHEET
(Unaudited) (In millions)
September 30, December 31,
2003 2002
----------- ------------
ASSETS
Current Assets:
Cash and cash equivalents $ 3 $ 22
Accounts receivable - trade (less allowance for doubtful
accounts of $3 and $2, respectively) 51 47
Unbilled revenue 22 32
Miscellaneous accounts and notes receivable 6 7
Materials and supplies, at average cost 71 61
Other current assets 7 24
-------- -------
Total current assets 160 193
-------- -------
Property and Plant, Net 950 890
Other Non-Current Assets 21 18
Regulatory Assets 15 8
-------- -------
TOTAL ASSETS $ 1,146 $ 1,109
======== =======
LIABILITIES AND STOCKHOLDER'S EQUITY
Current Liabilities:
Current maturities of long-term debt $ 100 $ 27
Short-term debt - 10
Borrowings from money pool 109 -
Accounts and wages payable 81 68
Taxes accrued 12 18
Other current liabilities 29 31
-------- -------
Total current liabilities 331 154
-------- -------
Long-term Debt, Net 138 316
Preferred Stock Subject to Mandatory Redemption 21 -
Deferred Credits and Other Non-Current Liabilities:
Accumulated deferred income taxes, net 105 95
Accumulated deferred investment tax credits 12 13
Regulatory liabilities 17 19
Accrued pension liabilities 98 85
Other deferred credits and liabilities 76 63
-------- -------
Total deferred credits and other non-current liabilities 308 275
-------- -------
Preferred Stock Subject to Mandatory Redemption - 22
Commitments and Contingencies (Note 8)
Stockholder's Equity:
Common stock, no par value, 20.0 shares authorized - 13.6 shares outstanding 186 186
Preferred stock not subject to mandatory redemption 19 19
Other paid-in capital 52 52
Retained earnings 124 114
Accumulated other comprehensive income (loss) (33) (29)
-------- -------
Total stockholder's equity 348 342
-------- -------
TOTAL LIABILITIES AND STOCKHOLDER'S EQUITY $ 1,146 $ 1,109
======== =======
The accompanying notes as they relate to CILCO are an integral part of these
consolidated financial statements.
21
CENTRAL ILLINOIS LIGHT COMPANY
CONSOLIDATED STATEMENT OF INCOME
(Unaudited) (In millions)
Three Months Ended Nine Months Ended
September 30, September 30,
------------------------- ----------------------
2003 2002 2003 2002
------------ --------- ---------- ---------
Operating Revenues:
Electric $ 168 $ 167 $ 420 $ 396
Gas 35 28 201 150
----- ----- ----- -----
Total operating revenues 203 195 621 546
----- ----- ----- -----
Operating Expenses:
Fuel and purchased power 85 70 214 180
Gas purchased for resale 21 15 136 91
Other operations and maintenance 43 30 123 100
Depreciation and amortization 16 18 53 53
Taxes other than income taxes 9 10 30 31
----- ----- ----- -----
Total operating expenses 174 143 556 455
----- ----- ----- -----
Operating Income 29 52 65 91
Other Income and (Deductions):
Miscellaneous income - - 1 1
Miscellaneous expense (2) - (4) (2)
----- ----- ----- -----
Total other income and (deductions) (2) - (3) (1)
----- ----- ----- -----
Interest Charges 3 6 13 16
----- ----- ----- -----
Income Before Income Taxes and Cumulative Effect of Change
in Accounting Principle 24 46 49 74
Income Taxes 9 17 18 27
----- ----- ----- -----
Income Before Cumulative Effect of Change in Accounting
Principle 15 29 31 47
Cumulative Effect of Change in Accounting Principle,
Net of Income Taxes - - 24 -
----- ----- ----- -----
Net Income 15 29 55 47
Preferred Stock Dividends - 1 1 2
----- ----- ----- -----
Net Income Available to Common Stockholder $ 15 $ 28 $ 54 $ 45
===== ===== ===== =====
The accompanying notes as they relate to CILCO are an integral part of these
consolidated financial statements.
22
CENTRAL ILLINOIS LIGHT COMPANY
CONSOLIDATED STATEMENT OF CASH FLOWS
(Unaudited) (In millions)
Nine Months Ended
September 30,
-----------------------
2003 2002
----------- ---------
Cash Flows From Operating Activities:
Net income $ 55 $ 47
Adjustments to reconcile net income to net cash
provided by operating activities:
Cumulative effect of change in accounting principle (24) -
Depreciation and amortization 53 53
Deferred income taxes, net (8) 2
Deferred investment tax credits, net (1) (2)
Other (4) 6
Changes in assets and liabilities:
Receivables, net 7 4
Materials and supplies (10) 3
Accounts and wages payable 13 (25)
Taxes accrued (6) 14
Assets, other 6 3
Liabilities, other 19 (8)
-------- --------
Net cash provided by operating activities 100 97
-------- --------
Cash Flows From Investing Activities:
Construction expenditures (68) (96)
Other 1 1
-------- --------
Net cash used in investing activities (67) (95)
-------- --------
Cash Flows From Financing Activities:
Dividends on common stock (44) (28)
Dividends on preferred stock (1) (2)
Redemptions, repurchases, and maturities:
Short-term debt (10) (43)
Long-term debt (105) (1)
Preferred stock (1) -
Issuances:
Long-term debt - 100
Borrowings from money pool 109 -
-------- --------
Net cash provided by (used in) financing activities (52) 26
-------- --------
Net change in cash and cash equivalents (19) 28
Cash and cash equivalents at beginning of year 22 12
-------- --------
Cash and cash equivalents at end of period $ 3 $ 40
======== ========
Cash Paid During the Periods:
Interest $ 17 $ 24
Income taxes, net 11 15
The accompanying notes as they relate to CILCO are an integral part of these
consolidated financial statements.
23
AMEREN CORPORATION (CONSOLIDATED)
UNION ELECTRIC COMPANY (CONSOLIDATED)
CENTRAL ILLINOIS PUBLIC SERVICE COMPANY
AMEREN ENERGY GENERATING COMPANY
CILCORP INC. (CONSOLIDATED)
CENTRAL ILLINOIS LIGHT COMPANY (CONSOLIDATED)
COMBINED NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
September 30, 2003
NOTE 1 - Summary of Significant Accounting Policies
General
Ameren is a public utility holding company registered with the SEC under
the PUHCA and is headquartered in St. Louis, Missouri. Our principal businesses
are involved in the generation, transmission and distribution of electricity,
and the distribution of natural gas, to residential, commercial, industrial and
wholesale users in the central United States. Ameren's principal subsidiaries
are as follows:
o UE, which operates a rate-regulated electric generation, transmission and
distribution business, and a rate-regulated natural gas distribution
business in Missouri and Illinois.
o CIPS, which operates a rate-regulated electric and natural gas transmission
and distribution business in Illinois.
o CILCO, a subsidiary of CILCORP (a holding company), which operates a
rate-regulated electric transmission and distribution business, a non
rate-regulated electric generation business (AERG), and a rate-regulated
natural gas distribution business in Illinois. Ameren completed its
acquisition of CILCORP on January 31, 2003. See Note 2 - Acquisitions for
further information.
o Resources Company, which consists of non rate-regulated operations.
Subsidiaries include Genco, which operates a non rate-regulated electric
generation business in Illinois and Missouri; Marketing Company, which
markets power for periods primarily over one year; AFS, which procures fuel
and manages the related risks for Ameren's affiliated companies; and Medina
Valley, which indirectly owns a 40 megawatt, gas-fired electric generation
plant. Ameren completed its acquisition of AES Medina Valley Cogen (No. 4)
LLC on February 4, 2003. See Note 2 - Acquisitions for further information.
o Ameren Energy, which serves as a power marketing and risk management agent
for Ameren and its subsidiaries for transactions of primarily less than one
year.
o EEI, which operates electric generation and transmission facilities in
Illinois. Ameren has a 60% ownership interest in EEI through UE, which owns
40%, and Resources Company, which owns 20%. Ameren consolidates EEI for
financial reporting purposes, while UE and Resources Company report EEI
under the equity method.
o Ameren Services, which provides a variety of shared support services to us.
In October 2003, CILCO transferred its Duck Creek and E. D. Edwards
coal-fired plants and its Sterling Avenue combustion turbine facilities
representing in the aggregate approximately 1,100 megawatts of electric
generating capacity to its wholly-owned subsidiary, AERG, in exchange for all of
the outstanding stock of AERG and AERG's assumption of certain liabilities. The
net book value of the transferred assets was approximately $378 million and no
gain or loss was recognized as the transaction was accounted for as a transfer
between entities under common control. Approximately 23% of CILCO's employees
were transferred to AERG as a part of the transaction.
When we refer to our, we or us, it indicates that the referenced
information is common to all Ameren Companies. When we refer to financing or
acquisition activities, we are defining Ameren as the parent holding company.
When appropriate, our subsidiaries are specifically referenced in order to
distinguish among their different business activities.
The financial statements of Ameren, UE, CILCORP and CILCO are prepared on a
consolidated basis and therefore include the accounts of their majority-owned
subsidiaries. Results of CILCORP and CILCO reflected in Ameren's consolidated
financial statements include the period from the acquisition date of January 31,
2003 through September 30, 2003. January 2003 and prior year data for CILCORP
and CILCO is not included in Ameren's consolidated totals. See
24
Note 2 - Acquisitions f