MIDAMERICAN ENERGY HOLDINGS CO /NEW/ - 10-Q Quarterly Report

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended September 30, 2004

Commission File No. 0-25551

MIDAMERICAN ENERGY HOLDINGS COMPANY

(Exact name of registrant as specified in its charter)

Iowa		94-2213782
(State or other jurisdiction of		(I.R.S. Employer
incorporation or organization)		Identification No.)



666 Grand Avenue, Des Moines, Iowa		50309
(Address of principal executive offices)		(Zip Code)

(515) 242-4300
(Registrant’s telephone number, including area code)


Securities registered pursuant to Section 12(b) of the Act: N/A
Securities registered pursuant to Section 12(g) of the Act: N/A

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No o

Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act). Yes o No x

All of the shares of MidAmerican Energy Holdings Company are privately held by a limited group of investors. As of October 31, 2004, 9,081,087 shares of common stock were outstanding.

TABLE OF CONTENTS

PART I - FINANCIAL INFORMATION

Financial Statements

Management’s Discussion and Analysis of Financial Condition and Results of Operations

Quantitative and Qualitative Disclosures About Market Risk

Controls and Procedures

PART II - OTHER INFORMATION

Unregistered Sales of Equity Securities and Use of Proceeds

Defaults Upon Senior Securities

Submission of Matters to a Vote of Security Holders

PART I - FINANCIAL INFORMATION

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Stockholders

MidAmerican Energy Holdings Company

We have reviewed the accompanying consolidated balance sheet of MidAmerican Energy Holdings Company and subsidiaries (the “Company”) as of September 30, 2004, and the related consolidated statements of operations for the three-month and nine-month periods ended September 30, 2004 and 2003 and of cash flows for the nine-month periods ended September 30, 2004 and 2003. These interim financial statements are the responsibility of the Company’s management.

We conducted our reviews in accordance with standards of the Public Company Accounting Oversight Board (United States). A review of interim financial information consists principally of applying analytical procedures and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit conducted in accordance with standards of the Public Company Accounting Oversight Board (United States), the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion.

Based on our reviews, we are not aware of any material modifications that should be made to such consolidated interim financial statements for them to be in conformity with accounting principles generally accepted in the United States of America.

We have previously audited, in accordance with standards of the Public Company Accounting Oversight Board (United States), the consolidated balance sheet of MidAmerican Energy Holdings Company and subsidiaries as of December 31, 2003, and the related consolidated statements of operations, stockholders’ equity, and cash flows for the year then ended (not presented herein); and in our report dated February 9, 2004 (March 1, 2004 as to Notes 2, 5 and 20), we expressed an unqualified opinion on those consolidated financial statements. In our opinion, the information set forth in the accompanying consolidated balance sheet as of December 31, 2003 is fairly stated, in all material respects, in relation to the consolidated balance sheet from which it has been derived.

/s/ Deloitte & Touche LLP

DELOITTE & TOUCHE LLP

MIDAMERICAN ENERGY HOLDINGS COMPANY

CONSOLIDATED BALANCE SHEETS

(Amounts in thousands)

	As of
	September 30,			December 31,
	2004			2003
	(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	975,762		$	660,213
Restricted cash and short-term investments		124,634			55,281
Accounts receivable, net		553,273			666,063
Inventories		135,426			123,301
Other current assets		264,829			371,855
Total current assets		2,053,924			1,876,713
Properties, plants and equipment, net		11,087,205			11,180,979
Goodwill		4,267,914			4,305,643
Regulatory assets		482,925			512,549
Other investments		235,481			228,896
Equity investments		243,176			234,370
Deferred charges and other assets		857,262			829,039
Total assets	$	19,227,887		$	19,168,189

LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable	$	321,340		$	345,237
Accrued interest		217,851			189,635
Accrued property and other taxes		141,623			112,823
Other liabilities		542,054			443,531
Short-term debt		7,691			48,036
Current portion of long-term debt		1,054,322			500,941
Current portion of parent company subordinated debt		121,533			100,000
Total current liabilities		2,406,414			1,740,203
Other long-term accrued liabilities		2,020,163			1,827,633
Parent company senior debt		2,770,842			2,777,878
Parent company subordinated debt		1,652,271			1,772,146
Subsidiary and project debt		6,115,117			6,674,640
Deferred income taxes		1,344,726			1,433,144
Total liabilities		16,309,533			16,225,644

Deferred income		67,845			69,201
Minority interest		12,893			9,754
Preferred securities of subsidiaries		89,834			92,145

Commitments and contingencies (Note 8)

Stockholders' equity:
Zero-coupon convertible preferred stock - authorized 50,000 shares, no par value, 41,263 shares issued and outstanding		-			-
Common stock - authorized 60,000 shares, no par value, 9,081 and 9,281 shares issued and outstanding at September 30, 2004, and December 31, 2003, respectively		-			-
Additional paid-in capital		1,951,094			1,957,277
Retained earnings		970,657			999,627
Accumulated other comprehensive loss, net		(173,969	)		(185,459	)
Total stockholders' equity		2,747,782			2,771,445
Total liabilities and stockholders' equity	$	19,227,887		$	19,168,189

The accompanying notes are an integral part of these financial statements.

MIDAMERICAN ENERGY HOLDINGS COMPANY

CONSOLIDATED STATEMENTS OF OPERATIONS

(Amounts in thousands)

Ended September 30,

Income on equity investments

Interest and dividend income

Costs and expenses:

Depreciation and amortization

	Three Months				Nine Months
	Ended September 30,				Ended September 30,
	2004		2003		2004		2003
			(Unaudited)

Revenues:
Operating revenue	$	1,534,057	$	1,474,453	$	4,858,826	$	4,400,778
Income on equity investments		18,792		19,385		28,083		40,386
Interest and dividend income		11,066		6,746		25,528		39,930
Other income		13,217		6,378		44,514		53,302
Total revenue		1,577,132		1,506,962		4,956,951		4,534,396

Costs and expenses:
Cost of sales		591,370		558,869		2,020,132		1,761,686
Operating expense		409,048		399,118		1,216,493		1,123,249
Depreciation and amortization		165,058		133,835		496,354		433,859
Interest expense		225,021		174,238		677,825		538,685

Item 1.	Financial Statements	3
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	20
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	35
Item 4.	Controls and Procedures	35

PART II - OTHER INFORMATION

Item 1.	Legal Proceedings	36
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	36
Item 3.	Defaults Upon Senior Securities	36
Item 4.	Submission of Matters to a Vote of Security Holders	36
Item 5.	Other Information	36
Item 6.	Exhibits	36
Signatures		37
Exhibit Index		38