EX-99.2 4 ex_f2.htm CONSOLIDATING FINANCIAL STATEMENTS Consolidating Financial Statements

 Exhibit F-2
 
THE CLEVELAND ELECTRIC ILLUMINATING COMPANY
CONSOLIDATING INCOME STATEMENT
For the Year Ended December 31, 2004
(In thousands $)
                       
                     
   
Cleveland Electric
  
Centerior
  
Shippingport
      
Cleveland
Electric Illuminating
  
   
Illuminating
   Funding  
Capital
      
Company
  
   
Company
  
Corp
  
Trust
  
Eliminations
  
Consolidated
  
                       
OPERATING REVENUES
  
$
1,802,470
  
$
6,015
  
$
-
  
$
-
  
$
1,808,485
  
                                 
OPERATING EXPENSES AND TAXES:
                                
Fuel and purchased power
    
622,021
   
-
   
-
   
-
   
622,021
 
Nuclear operating costs
    
117,091
   
-
   
-
   
-
   
117,091
 
Other operating costs
    
272,110
   
193
   
-
   
-
   
272,303
 
Provision for depreciation
    
131,854
   
-
   
-
   
-
   
131,854
 
Amortization of regulatory assets
    
196,501
   
-
   
-
   
-
   
196,501
 
Deferral of new regulatory assets
    
(117,466
)
  
-
   
-
   
-
   
(117,466
)
General taxes
    
146,276
   
-
   
-
   
-
   
146,276
 
Income taxes
    
111,995
   
1
   
-
   
-
   
111,996
 
Total operating expenses and taxes
    
1,480,382
   
194
   
-
   
-
   
1,480,576
 
                                 
OPERATING INCOME
    
322,088
   
5,821
   
-
   
-
   
327,909
 
                                 
Equity in subsidiary earnings
    
2,169
   
-
   
-
   
(2,169
)
  
-
 
Other income
    
69,295
   
-
   
46,273
   
(30,079
)
  
85,489
 
Other income deductions
    
(14,302
)
  
-
   
-
   
(2,138
)
  
(16,440
)
Other income taxes
    
(25,690
)
  
(1,169
)
  
-
   
-
   
(26,859
)
OTHER INCOME
    
31,472
   
(1,169
)
  
46,273
   
(34,386
)
  
42,190
 
                                 
NET INTEREST CHARGES:
                                
Interest on long-term debt
    
120,058
   
-
   
-
   
-
   
120,058
 
Allowance for borrowed funds used during construction
    
(5,110
)
  
-
   
-
   
-
   
(5,110
)
Other interest expense
    
2,081
   
2,483
   
44,135
   
(30,079
)
  
18,620
 
Net interest charges
    
117,029
   
2,483
   
44,135
   
(30,079
)
  
133,568
 
                                 
NET INCOME
    
236,531
   
2,169
   
2,138
   
(4,307
)
  
236,531
 
                                 
PREFERRED STOCK
                                
DIVIDEND REQUIREMENTS
    
7,008
   
-
   
-
   
-
   
7,008
 
                                 
EARNINGS ON COMMON STOCK
  
$
229,523
  
$
2,169
  
$
2,138
  
$
(4,307
)
$
229,523
  
                                 
                                 
The notes to the consolidated financial statements of Cleveland Electric Illuminating Company, which are incorporated by reference from the annual report on Form 10-K or the year ended December 31, 2004, are an integral part of the consolidating financial statements.
                                 

 

 
                   
Exhibit F-2
  
   
THE CLEVELAND ELECTRIC ILLUMINATING COMPANY
 
CONSOLIDATING BALANCE SHEETS
  
As of December 31, 2004
  
(In thousands $)
  
                       
                   
Cleveland
 
   
Cleveland Electric
 
Centerior
 
Shippingport
 
 
 
Electric
Illuminating
 
 
 
Illuminating
 
Funding
 
Capital
 
 
 
Company
 
ASSETS
 
Company
 
Corp
 
Trust
 
Eliminations
 
Consolidated
 
                       
UTILITY PLANT:
                      
In service
  
$
4,418,313
  
$
-
  
$
-
  
$
-
  
$
4,418,313
  
Less-Accumulated provision for depreciation
    
(1,961,737
)
  
-
   
-
   
-
   
(1,961,737
)
     
2,456,576
   
-
   
-
   
-
   
2,456,576
 
Construction work in progress
    
116,085
   
-
   
-
   
-
   
116,085
 
     
2,572,661
   
-
   
-
   
-
   
2,572,661
 
                                 
OTHER PROPERTY AND INVESTMENTS:
                                
Investment in lessor notes
    
-
   
-
   
596,645
   
-
   
596,645
 
Nuclear plant decommissioning trusts
    
383,875
   
-
   
-
   
-
   
383,875
 
Long-term notes receivable from associated companies
    
97,489
   
-
   
-
   
-
   
97,489
 
Other
    
532,465
   
-
   
-
   
(515,464
)
  
17,001
 
     
1,013,829
   
-
   
596,645
   
(515,464
)
  
1,095,010
 
                                 
CURRENT ASSETS:
                                
Cash and cash equivalents
    
127
   
-
   
70
   
-
   
197
 
Receivables-
                                
Customers
    
11,537
   
-
   
-
   
-
   
11,537
 
Associated companies
   
47,807
   
255
   
-
   
(14,648
)
  
33,414
 
Other
    
(20,586
)
  
161,844
   
11,527
   
-
   
152,785
 
Notes receivable from associated companies
    
521
   
4,500
   
-
   
(4,500
)
  
521
 
Material and supplies
    
58,922
   
-
   
-
   
-
   
58,922
 
Prepayments and other
    
2,136
   
-
   
-
   
-
   
2,136
 
     
100,464
   
166,599
   
11,597
   
(19,148
)
  
259,512
 
                                 
DEFERRED CHARGES:
                                
Regulatory assets
    
958,986
   
-
   
-
   
-
   
958,986
 
Goodwill
    
1,693,629
   
-
   
-
   
-
   
1,693,629
 
Property taxes
    
77,792
   
-
   
-
   
-
   
77,792
 
Other
    
32,875
   
-
   
-
   
-
   
32,875
 
     
2,763,282
   
-
   
-
   
-
   
2,763,282
 
                                 
TOTAL ASSETS
  
$
6,450,236
  
$
166,599
  
$
608,242
  
$
(534,612
)
$
6,690,465
  
                                 
                                 
The notes to the consolidated financial statements of Cleveland Electric Illuminating Company, which are incorporated by reference from the annual report on Form 10-K for the year ended December 31, 2004, are an integral part of the consolidating financial statements.
 
 
 
 
                             
Exhibit F-2
  
                               
THE CLEVELAND ELECTRIC ILLUMINATING COMPANY
CONSOLIDATING BALANCE SHEETS
As of December 31, 2004
(In thousands $)
   
 
 
 
 
 
 
 
 
 
 
 
Cleveland
 
 
 
Cleveland Electric 
 
 
Centerior
 
 
Shippingport
 
 
 
 
 
Electric Illuminating
 
 
 
Illuminating 
 
 
Funding
 
 
Capital
 
 
 
 
 
Company
 
CAPITALIZATION AND LIABILITIES
 
 
Company
 
 
Corp
 
 
Trust
 
 
Eliminations
 
 
Consolidated
  
                                 
CAPITALIZATION:
                                
Common stockholder's equity
  
$
1,853,561
  
$
148,624
  
$
31,498
  
$
(180,122
)
$
1,853,561
  
Preferred stock not subject to mandatory redemption
    
96,404
   
-
   
-
   
-
   
96,404
 
Long-term debt and other long-term obligations
    
1,781,488
   
-
   
555,469
   
(366,840
)
  
1,970,117
 
     
3,731,453
   
148,624
   
586,967
   
(546,962
)
  
3,920,082
 
                                 
CURRENT LIABILITIES:
                                
Currently payable long-term debt
   
76,701
   
-
   
-
   
-
   
76,701
 
Accounts payable-
                                
Associated companies
    
139,922
   
13,876
   
10,991
   
(14,648
)
  
150,141
 
Other
    
9,271
   
-
   
-
   
-
   
9,271
 
Notes payable to associated companies
    
479,144
   
3,775
   
10,214
   
(4,500
)
  
488,633
 
Accrued taxes
    
129,454
   
-
   
-
   
-
   
129,454
 
Accrued interest
    
22,102
   
-
   
-
   
-
   
22,102
 
Lease market valuation liability
    
60,200
   
-
   
-
   
-
   
60,200
 
Other
    
60,807
   
324
   
-
   
-
   
61,131
 
     
977,601
   
17,975
   
21,205
   
(19,148
)
  
997,633
 
                                 
NONCURRENT LIABILITIES:
                                
Accumulated deferred income taxes
    
540,211
   
-
   
-
   
-
   
540,211
 
Accumulated deferred investment tax credits
    
60,901
   
-
   
-
   
-
   
60,901
 
Asset retirement obligation
    
272,123
   
-
   
-
   
-
   
272,123
 
Retirement benefits
    
82,306
   
-
   
-
   
-
   
82,306
 
Lease market valuation liability
    
668,200
   
-
   
-
   
-
   
668,200
 
Other
    
117,441
   
-
   
70
   
31,498
   
149,009
 
     
1,741,182
   
-
   
70
   
31,498
   
1,772,750
 
                                 
TOTAL CAPITALIZATION AND LIABILITIES
  
$
6,450,236
  
$
166,599
  
$
608,242
  
$
(534,612
)
$
6,690,465
  
                                 
                                 
The notes to the consolidated financial statements of Cleveland Electric Illuminating Company, which are incorporated by reference from the annual report on Form 10-K for the year ended December 31, 2004, are an integral part of the consolidating financial statements.
 
 

                   
Exhibit F-2
  
                       
THE CLEVELAND ELECTRIC ILLUMINATING COMPANY
 
CONSOLIDATING STATEMENT OF RETAINED EARNINGS
  
As of December 31, 2004
  
(In thousands $)
  
                       
                   
Cleveland
 
   
Cleveland Electric
  
Centerior
  
Shippingport
      
Electric
Illuminating
  
   
Illuminating
  
Funding
  
Capital
      
Company
  
 
  
Company
  
Corp
  
Trust
  
Eliminations
  
Consolidated
  
                       
RETAINED EARNINGS:
                      
Balance - Beginning of Period
  
$
494,212
  
$
3,794
  
$
-
  
$
(3,794
)
$
494,212
  
                                 
Net Income
    
236,531
   
2,169
   
2,138
   
(4,307
)
  
236,531
 
                                 
Cash Dividends on Common Stock
    
(170,000
)
  
(5,131
)
  
-
   
5,131
   
(170,000
)
                                 
Cash Dividends on Preferred Stock
    
(7,003
)
  
-
   
-
   
-
   
(7,003
)
                                 
Other
    
-
   
-
   
(1,606
)
  
1,606
   
-
 
                                 
Balance - End of Period
  
$
553,740
  
$
832
  
$
532
  
$
(1,364
)
$
553,740
  
                                 
                                 
                                 
ACCUMULATED OTHER COMPREHENSIVE INCOME:
                                
Balance - Beginning of Period
  
$
2,653
  
$
-
  
$
-
  
$
-
  
$
2,653
  
                                 
Unrealized gain on investments
    
11,450
   
-
   
-
   
-
   
11,450
 
                                 
Minimum liability for unfunded retirement benefits
    
3,756
   
-
   
-
   
-
   
3,756
 
                                 
Balance - End of Period
  
$
17,859
  
$
-
  
$
-
  
$
-
  
$
17,859
  
                                 
                                 
The notes to the consolidated financial statements of Cleveland Electric Illuminating Company, which are incorporated by reference from the annual report on Form 10-K for the year ended December 31, 2004, are an integral part of the consolidating financial statements.
 
 
                   
Exhibit F-2
  
THE CLEVELAND ELECTRIC ILLUMINATING COMPANY
CONSOLIDATING STATEMENT OF CASH FLOWS
  
For the Year Ended December 31, 2004
  
(In thousands $)
  
                       
                   
Cleveland
 
   
Cleveland Electric
  
Centerior
  
Shippingport
      
Electric
Illuminating
  
   
Illuminating
  
Funding
  
Capital
      
Company
  
   
Company
  
Corp
  
Trust
  
Eliminations
  
Consolidated
  
                       
CASH FLOWS FROM OPERATING ACTIVITIES:
                      
Net income
  
$
236,531
  
$
2,169
  
$
2,138
  
$
(4,307
)
$
236,531
  
Adjustments to reconcile net income to net
                                
cash from operating activities:
                                
Provision for depreciation
    
131,854
   
-
   
-
   
-
   
131,854
 
Amortization of regulatory assets
    
196,501
   
-
   
-
   
-
   
196,501
 
Deferral of new regulatory assets
    
(117,466
)
  
-
   
-
   
-
   
(117,466
)
Nuclear fuel and capital lease amortization
    
28,239
   
-
   
-
   
-
   
28,239
 
Amortization of electric service obligation
    
(18,386
)
  
-
   
-
   
-
   
(18,386
)
Deferred rents and lease market valuation liability
    
(56,405
)
  
-
   
-
   
-
   
(56,405
)
Deferred income taxes and investment tax credits, net
    
39,129
   
-
   
-
   
-
   
39,129
 
Accrued retirement benefit obligations
    
13,245
   
-
   
-
   
-
   
13,245
 
Accrued compensation, net
    
2,433
   
-
   
-
   
-
   
2,433
 
Pension trust contribution
    
(31,718
)
  
-
   
-
   
-
   
(31,718
)
Decrease (Increase) in operating assets:
                                
Receivables
    
113,223
   
(55,357
)
  
224
   
(19,793
)
  
38,297
 
Materials and supplies
    
(8,306
)
  
-
   
-
   
-
   
(8,306
)
Prepayments and other current assets
    
2,375
   
-
   
-
   
-
   
2,375
 
Increase (Decrease) in operating liabilities:
                                
Accounts payable
    
(99,394
)
  
(21,117
)
  
6,973
   
19,793
   
(93,745
)
Accrued taxes
    
(66,996
)
  
(6,072
)
  
-
   
-
   
(73,068
)
Accrued interest
    
(15,770
)
  
-
   
-
   
-
   
(15,770
)
Other
    
(40,980
)
  
(3
)
  
(2,664
)
  
(7,970
)
  
(51,617
)
Net cash provided from (used for) operating activities
    
308,109
   
(80,380
)
  
6,671
   
(12,277
)
  
222,123
 
                                 
CASH FLOWS FROM FINANCING ACTIVITIES:
                                
New Financing-
                                
Long-term debt
    
124,977
   
-
   
-
   
-
   
124,977
 
Equity contribution from parent
    
-
   
98,703
   
-
   
(98,703
)
  
-
 
Short-term borrowings, net
    
303,891
   
(13,192
)
  
(15,931
)
  
15,495
   
290,263
 
Redemptions and repayments-
                                
Preferred stock
    
(1,000
)
  
-
   
-
   
-
   
(1,000
)
Long-term debt
    
(335,393
)
  
-
   
-
   
-
   
(335,393
)
Dividend payments-
                                
Common stock
    
(170,000
)
  
(5,131
)
  
-
   
5,131
   
(170,000
)
Preferred stock
    
(7,008
)
  
-
   
-
   
-
   
(7,008
)
Net cash provided from (used for) financing activities
    
(84,533
)
  
80,380
   
(15,931
)
  
(78,077
)
  
(98,161
)
                                 
CASH FLOWS FROM INVESTING ACTIVITIES:
                                
Property additions
    
(121,316
)
  
-
   
-
   
-
   
(121,316
)
Loan repayments from (payments to) associated companies, net
    
18,767
   
-
   
-
   
(8,349
)
  
10,418
 
Investment in lessor notes
    
-
   
-
   
9,270
   
-
   
9,270
 
Contributions to nuclear decommissioning trusts
    
(29,024
)
  
-
   
-
   
-
   
(29,024
)
Other
    
(116,598
)
  
-
   
-
   
98,703
   
(17,895
)
Net cash provided from (used for) investing activities
    
(248,171
)
  
-
   
9,270
   
90,354
   
(148,547
)
                                 
NET INCREASE (DECREASE) IN
                               
CASH AND CASH EQUIVALENTS
  
$
(24,595
)
$
-
  
$
10
  
$
-
  
$
(24,585
)
                                 
The notes to the consolidated financial statements of Cleveland Electric Illuminating Company, which are incorporated by reference from the annual report on Form 10-K for the year ended December 31, 2004, are an integral part of the consolidating financial statements.
 
 

               
Exhibit F-2
  
                   
Jersey Central Power & Light Company
  
Consolidating Statement of Income
  
For the Year Ended December 31, 2004
  
(In Thousands)
  
                   
    Jersey Central    
JCP&L
  
Eliminations
  
Jersey Central Power &
 
   
Power &
 
Transition
 
and
 
Light Company
 
 
 
Light Company
 
Funding LLC
 
Adjustments
 
Consolidated
  
                   
OPERATING REVENUES
  
$
2,174,855
  
$
32,132
  
$
-
  
$
2,206,987
  
                           
OPERATING EXPENSES AND TAXES:
                          
Purchased Power
    
1,166,430
   
-
    
-
   
1,166,430
 
Other Operating Expenses
    
350,698
   
11
   
 
    
350,709
 
Provision for Depreciation
   
75,163
   
-
   
-
    
75,163
 
Amortization of Regulatory Assets
   
262,720
   
15,839
         
278,559
 
General Taxes
    
62,792
    -     -    
62,792
 
Income Taxes
    
89,425
   
-
   
-
   
89,425
 
Total Operating Expenses and Taxes
    
2,007,228
   
15,850
   
-
   
2,023,078
 
     
                   
OPERATING INCOME
    
167,627
   
16,282
   
-
   
183,909
 
                           
Other income
    
14,274
   
95
   
-
   
14,369
 
Equity Earnings
    
10
   
-
    
(10
)
  
-
 
Other Income Deductions
    
(409
)
  
(418
)
  
-
   
(827
)
Other Income Depreciation
    
(94
)
              
(94
)
Taxes - Other Income Deductions
    
(5,682
)
  
(5
)
  
-
   
(5,687
)
OTHER INCOME
    
8,099
   
(328
)
  
(10
)
  
7,761
 
                           
                           
NET INTEREST CHARGES:
                          
Interest On Long-Term Debt
    
64,896
   
15,944
   
-
    
80,840
 
Allowance for Borrowed Funds Used During Construction
    
(615
)
  
-
    
-
    
(615
)
Deferred Interest Income
    
(3,545
)
  
-
    
-
    
(3,545
)
Other Interest Expense
    
3,351
   
-
   
-
   
3,351
 
Net Interest Charges
    
64,087
   
15,944
   
-
   
80,031
 
                           
                           
NET INCOME
    
111,639
   
10
   
(10
)
  
111,639
 
Preferred Stock Dividend Requirements
    
500
   
-
   
-
   
500
 
                           
EARNINGS ON COMMON STOCK
  
$
111,139
  
$
10
  
$
(10
)
$
111,139
  
                           
                           
The notes to the consolidated financial statements of JCP&L, which are incorporated by reference from the annual report on Form 10-K for the year ended December 31, 2004 are an integral part of the consolidating financial statements.
 
 
 
 

               
Exhibit F-2
  
Jersey Central Power and Light Company
 
Consolidating Balance Sheet
  
As of December 31, 2004
  
(In Thousands)
                   
               
Jersey Central
 
 
  
Jersey Central
  
JCP&L
  
Eliminations
  
 Power &
 
   
Power &  
  
Transition
  
and
  
Light Company
  
   
Light Company
  
Funding LLC
  
Adjustments
  
Consolidated
  
                   
ASSETS
                  
UTILITY PLANT:
                  
In Service
  
$
3,730,767
  
$
-
  
$
-
  
$
3,730,767
  
Less - Total Accum Provision For Depreciation
    
1,380,775
               
1,380,775
 
Net Utility Plant excluding Construction Work In Progress
    
2,349,992
   
-
   
-
   
2,349,992
 
Construction Work In Progress
    
75,012
               
75,012
 
     
2,425,004
   
-
   
-
   
2,425,004
 
                           
OTHER PROPERTY & INVESTMENTS:
                          
Nuclear Plant Decommissioning Trust
    
138,205
    -      -    
138,205
 
Nuclear Fuel Disposal Trust
    
159,696
     -      -    
159,696
 
Long-term Notes Receivable from Associated Company
    
20,436
     -      -    
20,436
 
Investments in Subsidiaries
    
1,638
     -    
(1,638
)
  
-
 
Other
    
19,379
   
-
     -    
19,379
 
     
339,354
   
-
   
(1,638
)
  
337,716
 
                           
CURRENT ASSETS:
                          
Cash and Cash Equivalents
    
161
   
1
   
-
   
162
 
Receivables:
                          
Customers
    
201,415
     -      -    
201,415
 
Associated Companies
    
156,685
   
77,513
   
(147,667
)
  
86,531
 
Other
    
39,898
     -    
-
   
39,898
 
Material and Supples, at average cost
    
2,435
     -      -    
2,435
 
Prepayments and Other
    
26,372
   
5,117
     -    
31,489
 
     
426,966
   
82,631
   
(147,667
)
  
361,930
 
                           
DEFERRED CHARGES:
                          
Goodwill
    
1,985,036
     -      -    
1,985,036
 
Regulatory Assets
    
1,905,731
     -    
270,789
   
2,176,520
 
Accumulated Deferred Income Taxes
    
297,757
     -    
(297,757
)
  
-
 
Other
    
5,250
   
270,789
   
(271,061
)
  
4,978
 
     
4,193,774
   
270,789
   
(298,029
)
  
4,166,534
 
TOTAL ASSETS
  
$
7,385,098
  
$
353,420
  
$
(447,334
)
$
7,291,184
  
                           
The notes to the consolidated financial statements of JCP&L, which are incorporated by reference from the annual report on Form 10-K for the year ended December 31, 2004 are an integral part of the consolidating financial statements.
 
 
 
                      
Exhibit F-2 
  
Jersey Central Power and Light Company
Consolidating Balance Sheet
As of December 31, 2004
(In Thousands)
                           
   
Jersey Central
    
JCP&L 
    
Eliminations
    
Jersey Central Power &
  
 
    
Power &
    
Transition
    
and
    
Light Company
  
   
Light Company
    
Funding LLC
    
Adjustments
    
Consolidated
  
                           
CAPITALIZATION & LIABILITIES
                          
                           
CAPITALIZATION:
                          
Common Stockholder's Equity
  
$
3,155,364
  
$
1,626
  
$
(1,628
)
$
3,155,362
  
Preferred stock not subject to mandatory redemption
    
12,649
   
-
   
-
   
12,649
  
Long-Term Debt and Other Long-Term Obligations
    
974,923
   
264,333
   
(272
)
  
1,238,984
 
     
4,142,936
   
265,959
   
(1,900
)
  
4,406,995
 
                           
CURRENT LIABILITIES:
                          
Currently Payable Long-Term Debt
   
315
   
16,551
    -    
16,866
 
Accounts Payable:
                          
Associated Companies
    
98,667
   
69,605
   
(147,667
)
  
20,605
 
Other
    
124,733
     -    
-
   
124,733
 
Notes payable to associated companies
    
248,532
     -      -    
248,532
 
Accrued Taxes
    
2,621
   
5
     -    
2,626
 
Accrued Interest
    
9,059
   
1,300
   
-
   
10,359
 
Other
    
65,140
     -    
(10
)
  
65,130
 
     
549,067
   
87,461
   
(147,677
)
  
488,851
 
                           
NONCURRENT LIABILITIES:
                          
Power Purchase Contract Loss Liability
    
1,268,478
     -      -    
1,268,478
 
Accumulated Deferred Income Taxes
    
943,498
     -    
(297,757
)
  
645,741
 
Accumulated Deferred Investment Tax Credits
    
6,124
     -      -    
6,124
 
Nuclear Fuel Disposal Costs
    
169,884
     -      -    
169,884
 
Asset Retirement Obligation
    
72,655
     -      -    
72,655
 
Retirement Benefits
    
103,036
     -      -    
103,036
 
Other
    
129,420
     -      -    
129,420
 
     
2,693,095
   
-
   
(297,757
)
  
2,395,338
 
                           
TOTAL CAPITALIZATION & LIABILITIES
  
$
7,385,098
  
$
353,420
  
$
(447,334
)
$
7,291,184
  
                           
The notes to the consolidated financial statements of JCP&L, which are incorporated by reference from the annual report on Form 10-K for the year ended December 31, 2004 are an integral part of the consolidating financial statements.
 
 
 
 

               
Exhibit F-2
  
Jersey Central Power & Light Company
 
Consolidating Statement of Retained Earnings
  
For the Year Ended December 31, 2004
  
(In Thousands)
  
                   
               
Jersey Central  
  
   
Jersey Central
  
JCP&L
  
Eliminations
  
Power &
  
   
Power & Light
  
Transition
 
and
  
Light Company
  
   
Company
  
Funding LLC
  
Adjustments
  
Consolidated
  
                   
Balance at beginning of period
  
$
22,132
  
$
15
  
$
(15
)
  
22,132
 
                           
Net income
    
111,639
   
10
   
(10
)
  
111,639
 
                           
Cash dividends on common stock
    
(90,000
)
  
-
   
-
   
(90,000
)
                           
Cash dividends on preferred stock
    
(500
)
  
-
   
-
   
(500
)
                           
Balance at end of period
  
$
43,271
  
$
25
  
$
(25
)
$
43,271
  
                           
                           
Accumulated Other Comprehensice Income
                          
                           
Balance - Beginning of Period
  
$
(51,765
)
$
-
  
$
-
  
$
(51,765
)
                           
Net unrealized loss on investments
    
(5
)
    -     -    
(5
)
                           
Net unrealized gain on derivative instrument
    
1,697
     -      -    
1,697
 
                           
Minimum liability for unfunded retirement benefits
    
(5,461
)
    -      -    
(5,461
)
                           
Balance - End of Period
  
$
(55,534
)
$
-
  
$
-
  
$
(55,534
)
                           
                           
The notes to the consolidated financial statements of JCP&L, which are incorporated by reference from the annual report on Form 10-K for the year ended December 31, 2004 are an integral part of the consolidating financial statements.
                         
 

               
Exhibit F-2
  
Jersey Central Power & Light Company
Consolidating Statement of Cash Flows
For the Year Ended December 31, 2004
(In Thousands)
                   
                   
               
Jersey Central  
  
   
Jersey Central  
  
JCP&L
  
Eliminations
  
Power &
  
   
Power &
  
Transition
  
and
  
Light Company
  
   
Light Company
  
Funding LLC
  
Adjustments
  
Consolidated
  
                   
CASH FLOWS FROM OPERATING ACTIVITIES:
                  
Net Income
  
$
111,639
  
$
10
  
$
(10
)
$
111,639
  
Adjustments to reconcile net cash from operating activities:
                          
Provision for depreciation
   
75,163
   
-
   
-
   
75,163
 
Amortization of regulatory assets
    
262,720
   
15,839
   
-
   
278,559
 
Deferred costs, net
    
(263,257
)
        
-
   
(263,257
)
Deferred income taxes, net
    
56,474
   
-
   
-
   
56,474
 
Investment tax credits, net
    
(1,587
)
        
-
   
(1,587
)
Receivables
    
(21,382
)
  
(17,214
)
  
25,236
   
(13,360
)
Materials and Supplies
    
45
         
-
   
45
 
Accounts Payable
    
7,546
   
14,803
   
(25,236
)
  
(2,887
)
Pension Trust Contribution
    
(62,499
)
    -     -    
(62,499
)
NUG Power Contract Restructuring
    
52,800
     -      -    
52,800
 
Tax Collections Payable
    
(2,376
)
    -      -    
(2,376
)
Accrued retirement benefit obligation
    
(2,986
)
    -      -    
(2,986
)
Accrued compensation
    
1,014
     -      -    
1,014
 
Other
    
33,858
   
2,044
   
9
   
35,911
 
Net cash provided by operating activities
    
247,172
   
15,482
   
(1
)
  
262,653
 
                           
                           
CASH FLOWS FROM FINANCING ACTIVITIES:
                          
New Financing -
                          
Long-term debt
    
300,000
     -    
-
   
300,000
 
Short-term borrowings, net
    
17,547
     -    
-
   
17,547
 
Redemptions and Repayments -
                         
Long-term debt
    
(293,390
)
  
(15,482
)
  
-
   
(308,872
)
Dividend Payments -
                         
Preferred stock
    
(500
)
    -    
-
   
(500
)
Common stock
   
(90,000
)
    -    
-
   
(90,000
)
Net cash used for financing activities
    
(66,343
)
  
(15,482
)
  
-
   
(81,825
)
                           
                           
                           
CASH FLOWS FROM INVESTING ACTIVITIES:
                          
Property Additions
    
(178,877
)
  
-
   
-
   
(178,877
)
Contributions to decommissioning trusts
    
(2,895
)
    -      -    
(2,895
)
Loan payments to associated companies, net
    
(857
)
    -      -    
(857
)
Other
    
1,692
   
-
   
-
   
1,692
 
Net cash used for investing activities
    
(180,937
)
  
-
   
-
   
(180,937
)
                           
                           
Net increase (decrease) in cash and cash equivalents
  
$
(108
)
$
-
  
$
(1
)
$
(109
)
                           
                           
The notes to the consolidated financial statements of JCP&L, which are incorporated by reference from the annual report on Form 10-K for the year ended December 31, 2004 are an integral part of the consolidating financial statements.
 
 
 
 

                       
Exhibit F-2
 
Metroplitan Edison Company
Consolidating Statement of Income
For the Year ending December 31, 2004
(In Thousands)
                           
                       
Metropolitan
 
   
Metropolitan
 
Met-Ed
     
York Haven
 
Eliminations
 
Edison
 
   
Edison
 
Preferred
 
Met-Ed
 
Power
 
and
 
Company
 
   
Company
 
Capital II, Inc.
 
Funding LLC
 
Company
 
Adjustments
 
Consolidated
 
                           
OPERATING REVENUES
 
$
1,071,040
    
 
$
13,812
  
$
6,977
  
$
(20,982
)
$
1,070,847
  
                                       
OPERATING EXPENSES AND TAXES:
                                     
Fuel
   
39
          -      -     -    
39
 
Purchased Power
   
561,926
   
    -     -    
(6,977
)
  
554,949
 
Other Operating Expenses
   
181,124
   
   
6,467
   
3,003
   
(193
)
  
190,401
 
Provision for Depreciation
   
39,725
   
    -    
1,436
   
-
    
41,161
 
Amortization of Regulatory Assets
   
105,675
           -     -      -    
105,675
 
General Taxes
   
70,403
   
     -    
54
   
-
    
70,457
 
Income Taxes
   
20,782
   
    -    
1,186
   
-
   
21,968
 
Total Operating Expenses and Taxes
   
979,674
   
   
6,467
   
5,679
   
(7,170
)
  
984,650
 
           
                         
OPERATING INCOME
   
91,366
   
   
7,345
   
1,298
   
(13,812
)
  
86,197
 
                                       
Other income
   
44,448
 
$
4
    
12
   
169
   
(2,408
)
  
42,225
 
Equity Earnings
   
5,832
   
-
     -    
-
    
(5,832
)
  
-
 
Other Income Deductions
   
(14,251
)
  
-
    -    
-
    
13,812
   
(439
)
 Taxes - Other Income Deductions     (16,249 )    -     -     -     -     (16,249 ) 
OTHER INCOME
   
19,780
   
4
   
12
   
169
   
5,572
   
25,537
 
INCOME BEFORE NET INTEREST CHARGES
   
111,146
   
4
   
7,357
   
1,467
   
(8,240
)
  
111,734
 
                                       
NET INTEREST CHARGES:
                                     
                                       
Interest On Long-Term Debt
   
40,630
   
-
     -    
-
    
-
    
40,630
 
Allowance for Borrowed Funds Used During
                                     
Construction and Capitalized Interest
   
(277
)
    -      -    
(1
)
  
-
    
(278
)
Deferred Interest Income
   
-
    -      -    
-
    
-
    
-
 
Other Interest Expense
   
3,838
   
-
   
2,997
     -    
(2,408
)
  
4,427
 
Net Interest Charges
   
44,191
   
-
   
2,997
   
(1
)
  
(2,408
)
  
44,779
 
                                       
       -      -     -     -      -      -  
NET INCOME
 
$
66,955
  
$
4
  
$
4,360
  
$
1,468
  
$
(5,832
)
$
66,955
  
                                       
The notes to the consolidated financial statements of Metropolitan Edison, which are incorporated by reference from the annual report on Form 10-K for the year end December 31, 2004, are an integral part of the consolidating financial statements.
 
 
 

                       
Exhibit F-2
  
Metroplitan Edison Company
  
Consolidating Balance Sheet
As of December 31, 2004
(In Thousands)
                           
   
Metropolitan Edison Company
  
Met-Ed
 Preferred Capital II, Inc.
  
Met-Ed
 Funding LLC
  
York Haven Power
Company
  
Eliminations
and Adjustments
  
Metropolitan Edison Company Consolidated
  
                           
ASSETS
                          
UTILITY PLANT:
                          
In Service
  
$
1,772,535
              
$
28,034
        
$
1,800,569
  
Less - Total Accum Provision For Depreciation
    
(695,739
)
              
(14,156
)
        
(709,895
)
Net Utility Plant excluding Construction Work In Progress
    
1,076,796
               
13,878
         
1,090,674
 
Construction Work In Progress:
                                      
Electric Plant
    
21,647
               
88
         
21,735
 
Total Construction Work In Progress
    
21,647
               
88
         
21,735
 
     
1,098,443
   
 
          
13,966
   
 
    
1,112,409
 
                                       
OTHER PROPERTY & INVESTMENTS:
                                      
Nuclear Plant Decommissioning Trust
    
216,951
                 -          
216,951
 
Long-term Notes Receivable from Associated
  Company
    
10,453
                 -          
10,453
 
Investments in Subsidiaries
    
37,844
                 -  
$
(37,844
)
  
-
 
Other
    
32,205
 
$
2,562
           -      -    
34,767
 
     
297,453
   
2,562
           -    
(37,844
)
  
262,171
 
                                       
CURRENT ASSETS:
                                      
Cash and Cash Equivalents
    
120
   
-
           -      -    
120
 
Accounts Receivables:
                                      
Customers
    
90,948
     -  
$
28,910
      -     -    
119,858
 
Associated Companies
    
117,772
     -    
39,317
   
1,077
   
(39,921
)
  
118,245
 
Other
    
15,473
   
4
    -    
16
     -    
15,493
 
Notes Receivables:
                             -     -  
Associated Companies
    
20,473
     -    
5,365
   
13,404
   
(20,473
)
  
18,769
 
Prepayments and Other
    
10,898
     -    
61
   
98
     -    
11,057
 
     
255,684
   
4
   
73,653
   
14,595
   
(60,394
)
  
283,542
 
                                       
DEFERRED CHARGES:
                                      
Regulatory Assets
    
693,133
    -      -      -      -    
693,133
 
Goodwill
    
869,585
     -      -      -      -    
869,585
 
Accumulated Deferred Income Taxes
    
395,932
     -      -    
(147
)
  
(395,785
)
  
-
 
Other
     24,438     -     -     -     -     24,438  
     
1,983,088
   
-
   
-
   
(147
)
  
(395,785
)
  
1,587,156
 
TOTAL ASSETS
  
$
3,634,668
  
$
2,566
  
$
73,653
  
$
28,414
  
$
(494,023
)
$
3,245,278
  
                                       
The notes to the consolidated financial statements of Meted, which are incorporated by reference from the annual report on Form 10-K for the year end December 31, 2004, are an integral part of the consolidating financial statements.
                                       
 
 

                       
Exhibit F-2
 
Metroplitan Edison Company
Consolidating Balance Sheet
As of December 31, 2004
(In Thousands)
                           
                       
Metropolitan
  
   
Metropolitan
  
Met-Ed
      
York Haven
  
Eliminations
  
Edison
  
   
Edison
  
Preferred
 
Met-Ed
  
Power
  
and
  
Company
  
   
Company
  
Capital II, Inc.
  
Funding LLC
  
Company
  
Adjustments
  
Consolidated
  
                           
CAPITALIZATION & LIABILITIES
                          
                           
CAPITALIZATION:
                          
Common Stockholder's Equity
  
$
1,285,419
  
$
2,313
  
$
8,582
  
$
26,949
  
$
(37,844
)
$
1,285,419
  
Long-Term Debt and Other Long-Term Obligations
    
701,736
                           
701,736
 
     
1,987,155
   
2,313
   
8,582
   
26,949
   
(37,844
)
  
1,987,155
 
                                       
CURRENT LIABILITIES:
                                      
Currently Payable Long-Term Debt
   
30,435
     -      -      -     -    
30,435
 
Accounts Payable:
                                      
Associated Companies
    
88,016
   
85
   
40,304
   
395
   
(39,921
)
  
88,879
 
Other
    
26,018
     -    
79
     -      -    
26,097
 
Notes Payable:
                                      
Associated Companies
    
80,090
    -    
20,473
     -    
(20,473
)
  
80,090
 
Accrued Taxes
    
11,771
   
168
     -    
18
     -    
11,957
 
Accrued Interest
    
11,522
    -    
96
    -      -    
11,618
 
Other
    
18,957
     -    
4,119
     -      -    
23,076
 
     
266,809
   
253
   
65,071
   
413
   
(60,394
)
  
272,152
 
                                       
NONCURRENT LIABILITIES:
                                      
Accumulated Deferred Income Taxes
    
700,151
     -      -    
1,023
   
(395,785
)
  
305,389
 
Accumulated Deferred Invest Tax Credits
    
10,839
     -      -    
29
    -    
10,868
 
Power Purchase Contract Loss Liability
    
349,980
     -      -      -      -    
349,980
 
Nuclear Fuel Disposal Fee
    
38,408
     -      -      -      -    
38,408
 
Nuclear Plant Decommissioning Costs
    
13,711
     -      -      -      -    
13,711
 
Asset Retirement Obligation
    
132,887
     -      -      -      -    
132,887
 
Pensions & Other Postretirement Benefits
    
82,218
     -      -      -      -    
82,218
 
Other
    
52,510
     -      -      -      -    
52,510
 
     
1,380,704
     -      -    
1,052
   
(395,785
)
  
985,971
 
                                       
Total Capitalization & Liabilities
  
$
3,634,668
  
$
2,566
  
$
73,653
  
$
28,414
  
$
(494,023
)
$
3,245,278
  
                                       
The notes to the consolidated financial statements of Meted, which are incorporated by reference from the annual report on Form 10-K for the year end December 31, 2004, are an integral part of the consolidating financial statements.
                             
       
 
 
 

                       
Exhibit F-2
 
 Metroplitan Edison Company
 Consolidating Statement of Retained Earnings
 For the Year ending December 31, 2004
 (In Thousands)
                           
                           
                       
Metropolitan
 
   
Metropolitan
 
Met-Ed 
      
York Haven
 
Eliminations
 
Edison
 
   
Edison
 
Preferred 
  
Met-Ed
 
Power
 
and
 
Company
 
   
Company
 
Capital II
 
Funding LLC
 
Company
 
Adjustments
 
Consolidated
 
                           
Balance at beginning of year
  
$
27,011
  
$
(480
)
$
-
  
$
3,318
  
$
(2,838
)
$
27,011
  
                                       
Net Income
    
66,955
   
4
   
4,360
   
1,468
   
(5,832
)
  
66,955
 
                                       
Cash dividends on common stock
    
(55,000
)
  
(114
)
    -      -    
114
   
(55,000
)
                                       
Balance at end of year
  
$
38,966
  
$
(590
)
$
4,360
  
$
4,786
  
$
(8,556
)
$
38,966
  
                                       
                                       
 
                                  Exhibit F-2   
Metropolitan Edison Company
Consolidating Accumulated Other Comprehensive Income
For the Year ending December 31, 2004
(In Thousands)
                                       
                                       
                                       
 
                                   Metropolitan   
 
 
 
Metropolitan 
 
 
Met-Ed 
          
York Haven
   
Eliminations
   
Edison
 
   
Edison 
 
 
Preferred 
 
  
Met-Ed
   
Power
   
and
   
Company
 
   
Company 
    
 Capital II
   
Funding LLC
   
Company
   
Adjustments
   
Consolidated
 
                                       
Balance - Beginning of year
  
$
(32,474
)
                        
$
(32,474
)
                                       
Unrealized gain/(loss) on available for sale securities
    
(26
)
                          
(26
)
                                       
Unrealized gain/(loss) on derivative hedges
    
(1,819
)
                          
(1,819
)
                                       
Minimum liability for unfunded retirement benefits
    
(9,171
)
                          
(9,171
)
                                       
Balance - End of year
  
$
(43,490
)
$
-
  
$
-
  
$
-
  
$
-
  
$
(43,490
)
                                       
                                       
The notes to the consolidated financial statements of Meted, which are incorporated by reference from the annual report on Form 10-K for the year ended December 31, 2004, are an integral part of the consolidating financial statements.
                                     
 
 
                       
Exhibit F-2
 
Metropolitan Edison Company
Consolidating Statement of Cash Flows
For the Year ending December 31, 2004
(In Thousands)
                           
   
Metropolitan
 
Met-Ed 
      
York Haven
 
Eliminations
 
Edison
 
   
Edison
 
Preferred
 
Met-Ed
 
Power
 
and
 
Company
 
   
Company
 
Capital II
 
Funding LLC
 
Company
 
Adjustments
 
Consolidated
 
CASH FLOWS FROM OPERATING ACTIVITIES:
                         
 
  
 
                      
Net Income
 
$
66,955
  
$
4
  
$
4,360
  
$
1,468
  
$
(5,832
)
$
66,955
  
Adjustments to reconcile net income to net cash from
                                      
    operating activities:
                                     
Equity in earnings of subsidiary
   
(5,832
)
   -      -      -    
5,832
     -  
Provision for depreciation
   
39,725
     -      -    
1,436
     -    
41,161
 
Amortization of regulatory assets
   
105,675
     -      -      -      -    
105,675
 
Deferred costs recoverable as regulatory assets
   
(65,981
)
    -      -      -      -    
(65,981
)
Deferred income taxes and investment tax credits, net
   
18,679
     -      -    
(184
)
    -    
18,495
 
Accrued retirement benefits obligations
   
(186
)
    -      -      -      -    
(186
)
Accrued compensation, net
   
584
     -      -      -      -    
584
 
Pension trust contribution
   
(38,823
)
    -      -      -      -    
(38,823
)
Decrease/(increase) in operating assets:
                                     
Receivables
   
(36,907
)
  
(5
)
  
(68,226
)
  
127
   
39,032
   
(65,979
)
Prepayments and other current assets
   
(4,590
)
    -    
(61
)
  
194
     -    
(4,457
)
Increase/(decrease) in operating liabilities:
                                     
Accounts payable
   
34,283
   
1
   
40,383
   
4
   
(39,032
)
  
35,639
 
Accrued taxes
   
3,216
   
(1
)
    -    
(20
)
    -    
3,195
 
Accrued interest
   
(326
)
    -    
96
     -      -    
(230
)
Other
   
(26,455
)
  
-
   
4,119
   
-
   
114
   
(22,222
)
     
                               
Net cash provided from (used for) operating activities
   
90,017
   
(1
)
  
(19,329
)
  
3,025
   
114
   
73,826
 
                                       
CASH FLOWS FROM FINANCING ACTIVITIES:
                                     
 
                                      
New Financing-
                                     
Long-term debt
   
247,606
    -      -      -      -    
247,606
 
Short-term borrowings, net
   
14,755
     -    
20,473
     -    
(20,473
)
  
14,755
 
Equity contribution from parent
     -      -    
4,222
     -    
(4,222
)
   -  
Redemptions and Repayments-
                                 
Preferred Stock
                                     
Long-term debt
   
(196,371
)
    -     -      -     -    
(196,371
)
Dividend payments
                                     
Common Stock
   
(55,000
)
    -      -     -     -    
(55,000
)
Preferred Stock
                                     
Partnership distribution - internal
   
114
   
114
    -   -    
(228
)
    -  
Common stock - internal
     -    
(114
)
    -      -    
114
     -  
     
                               
Net cash provided from (used for) financing activities
   
11,104
   
-
   
24,695
   
-
   
(24,809
)
  
10,990
 
                                       
CASH FLOWS FROM INVESTING ACTIVITIES:
                                     
 
                                      
Property additions
   
(52,892
)
    -      -    
(87
)
    -    
(52,979
)
Contributions to nuclear decommissioning trusts
   
(9,483
)
    -      -      -      -    
(9,483
)
Loan/(payments) from/(to) associated companies, net
   
(21,032
)
    -    
(5,366
)
  
(2,938
)
  
20,473
   
(8,863
)
Investment in subsidiary
   
(4,222
)
    -      -      -    
4,222
       
Other
   
(13,492
)
    -      -      -      -    
(13,492
)
     
                               
Net cash provided from (used for) investing activities
   
(101,121
)
  
-
   
(5,366
)
  
(3,025
)
  
24,695
   
(84,817
)
     
                               
Net decrease in cash and cash equivalents
 
$
-
  
$
(1
)
$
-
  
$
-
  
$
-
  
$
(1
)
                                       
The notes to the consolidated financial statements of Meted, which are incorporated by reference from the annual report on Form 10-K for the year end December 31, 2004, are an integral part of the consolidating financial statements.
 
 

                                       
Exhibit F-2
  
OHIO EDISON COMPANY
CONSOLIDATING INCOME STATEMENT
For the Year Ended December 31, 2004
(In thousands $)
                                           
   
Ohio Edison Company
 
Pennsylvania Power Company
Consolidated
 
OES Capital, Inc.
 
OES Finance, Inc.
 
OES Nuclear, Inc.
 
OES Ventures, Inc.
 
Apollo Tax Credit Fund IX
 
PNBV Capital Trust
 
Eliminations
 
Ohio Edison Company Consolidated
  
                                           
OPERATING REVENUES
  
$
2,395,917
  
$
549,121
  
$
22,370
  
$
-
  
$
14,348
  
$
-
  
$
-
  
$
-
  
$
(36,173
)
$
2,945,583
  
                                                               
OPERATING EXPENSES AND TAXES:
                                                              
Fuel and purchased power
    
823,305
   
203,925
   
-
   
-
   
-
   
-
   
-
   
-
   
-
   
1,027,230
 
Other operating costs
    
553,937
   
157,839
   
14,672
   
-
   
-
   
-
   
-
   
-
   
(14,367
)
  
712,081
 
Provision for depreciation
    
107,914
   
14,134
   
101
   
-
   
264
   
-
   
-
   
-
   
-
   
122,413
 
Amortization of regulatory assets
    
371,314
   
40,012
   
-
   
-
   
-
   
-
   
-
   
-
   
-
   
411,326
 
Deferral of new regulatory assets
    
(100,633
)
  
-
   
-
   
-
   
-
   
-
   
-
   
-
   
-
   
(100,633
)
General taxes
    
156,463
   
23,607
   
414
   
-
   
39
   
-
   
-
   
-
   
-
   
180,523
 
Income taxes
    
203,963
   
48,824
   
1,925
   
307
   
2,079
   
16
   
-
   
-
   
-
   
257,114
 
Total expenses
    
2,116,263
   
488,341
   
17,112
   
307
   
2,382
   
16
   
-
   
-
   
(14,367
)
  
2,610,054
 
                                                               
OPERATING INCOME
    
279,654
   
60,780
   
5,258
   
(307
)
  
11,966
   
(16
)
  
-
   
-
   
(21,806
)
  
335,529
 
                                                               
Equity in subsidiary earnings
    
60,945
   
-
   
-
   
-
   
-
   
881
   
-
   
-
   
(61,826
)
  
-
 
Other income
    
79,202
   
4,392
   
773
   
11,773
   
36
   
114
   
(3,578
)
  
32,912
   
(30,359
)
  
95,265
 
Other income taxes
    
(20,242
)
  
(928
)
  
-
   
-
   
-
   
(18
)
  
-
   
-
   
-
   
(21,188
)
OTHER INCOME
    
119,905
   
3,464
   
773
   
11,773
   
36
   
977
   
(3,578
)
  
32,912
   
(92,185
)
  
74,077
 
                                                               
NET INTEREST CHARGES:
                                                              
Interest on long-term debt
    
51,215
   
8,250
   
-
   
-
   
-
   
-
   
-
   
-
   
-
   
59,465
 
AFUDC and capitalized interest
    
(2,648
)
  
(4,563
)
  
-
   
-
   
-
   
-
   
-
   
-
   
-
   
(7,211
)
Other interest expense
    
8,226
   
1,481
   
2,387
   
11,016
   
9,048
   
3
   
-
   
31,149
   
(51,284
)
  
12,026
 
Subsidiary's preferred stock dividends
    
-
   
-
   
-
   
-
   
-
   
-
   
-
   
-
   
2,560
   
2,560
 
Net interest charges
    
56,793
   
5,168
   
2,387
   
11,016
   
9,048
   
3
   
-
   
31,149
   
(48,724
)
  
66,840
 
                                                               
 
                                                              
NET INCOME
    
342,766
   
59,076
   
3,644
   
450
   
2,954
   
958
   
(3,578
)
  
1,763
   
(65,267
)
  
342,766
 
                                                               
PREFERRED STOCK
                                                              
DIVIDEND REQUIREMENTS
    
2,502
   
2,560
   
-
   
-
   
-
   
-
   
-
   
-
   
(2,560
)
  
2,502
 
                                                               
EARNINGS ON COMMON STOCK
  
$
340,264
  
$
56,516
  
$
3,644
  
$
450
  
$
2,954
  
$
958
  
$
(3,578
)
$
1,763
  
$
(62,707
)
$
340,264
  
                                                               
                                                               
The notes to the consolidated financial statements of Ohio Edison Company, which are incorporated by reference from the annual report on Form 10-K for the year ending December 31, 2004, are an integral part of the consolidating financial statements.
 
 
 

                                   
Exhibit F-2
  
OHIO EDISON COMPANY
CONSOLIDATING BALANCE SHEET
As of December 31, 2004
(In thousands $)
                                 
 
  
ASSETS
  
Ohio
Edison
Company
  
 Pennsylvania Power
Company
Consolidated
  
OES
Capital, Inc.
  
OES Nuclear, Inc.
  
OES Ventures, Inc.
  
Apollo Tax Credit Fund IX
  
PNBV Capital Trust
  
Eliminations
  
Ohio Edison Company Consolidated
  
                                       
UTILITY PLANT:
                                      
In service
  
$
4,722,048
  
$
866,303
  
$
-
  
$
156,000
  
$
-
  
$
-
  
$
-
  
$
(303,977
)
$
5,440,374
  
Less--Accumulated provision for depreciation
    
(2,405,257
)
  
(356,020
)
  
-
   
(26,699
)
  
-
   
-
   
-
   
71,125
   
(2,716,851
)
     
2,316,791
   
510,283
   
-
   
129,301
   
-
   
-
   
-
   
(232,852
)
  
2,723,523
 
Construction work in progress
    
117,133
   
107,728
   
-
   
-
   
-
   
-
   
-
   
-
   
224,861
 
     
2,433,924
   
618,011
   
-
   
129,301
   
-
   
-
   
-
   
(232,852
)
  
2,948,384
 
                                                         
OTHER PROPERTY AND INVESTMENTS:
                                                        
Investment in lease obligation bonds
    
9,850
   
-
   
-
   
-
   
-
   
-
   
344,857
   
-
   
354,707
 
Nuclear plant decommissioning trusts
    
293,072
   
143,062
   
-
   
-
   
-
   
-
   
-
   
-
   
436,134
 
Long-term notes receivable from associated companies
    
175,185
   
32,985
   
-
   
-
   
-
   
-
   
-
   
-
   
208,170
 
Other
    
865,307
   
722
   
883
   
-
   
10,464
   
11,635
   
-
   
(840,432
)
  
48,579
 
     
1,343,414
   
176,769
   
883
   
-
   
10,464
   
11,635
   
344,857
   
(840,432
)
  
1,047,590
 
                                                         
CURRENT ASSETS:
                                                        
Cash and cash equivalents
    
143
   
38
   
-
   
-
   
-
   
1,049
   
-
   
-
   
1,230
 
Receivables--
                                                        
Customers
    
-
   
44,282
   
230,022
   
-
   
-
   
-
   
-
   
-
   
274,304
 
Associated companies
   
292,808
   
23,016
   
30,287
   
177
   
938
   
-
   
-
   
(102,078
)
  
245,148
 
Other
    
13,390
   
1,656
   
393
   
-
   
-
   
383
   
2,563
   
-
   
18,385
 
Notes receivable from associated companies
    
503,996
   
431
   
16,839
   
14,843
   
2,761
   
3,280
   
-
   
(3,279
)
  
538,871
 
Material and supplies
    
52,149
   
37,923
   
-
   
-
   
-
   
-
   
-
   
-
   
90,072
 
Prepayments and other
    
4,122
   
8,924
   
47
   
-
   
11
   
-
   
-
   
-
   
13,104
 
     
866,608
   
116,270
   
277,588
   
15,020
   
3,710
   
4,712
   
2,563
   
(105,357
)
  
1,181,114
 
                                                         
DEFERRED CHARGES:
                                                        
Regulatory assets
    
991,975
   
-
   
-
   
-
   
-
   
-
   
-
   
123,652
   
1,115,627
 
Accumulated deferred income tax benefits
    
-
   
-
   
1,302
   
-
   
445
   
-
   
-
   
(1,747
)
  
-
 
Property taxes
    
61,419
   
-
   
-
   
-
   
-
   
-
   
-
   
-
   
61,419
 
Unamortized sale and leaseback costs
    
60,242
   
-
   
-
   
-
   
-
   
-
   
-
   
-
   
60,242
 
Other
    
56,136
   
10,106
   
-
   
-
   
-
   
1,978
   
55
   
-
   
68,275
 
     
1,169,772
   
10,106
   
1,302
   
-
   
445
   
1,978
   
55
   
121,905
   
1,305,563
 
                                                         
TOTAL ASSETS
  
$
5,813,718
  
$
921,156
  
$
279,773
  
$
144,321
  
$
14,619
  
$
18,325
  
$
347,475
  
$
(1,056,736
)
$
6,482,651
  
                                                         
 
The notes to the consolidated financial statements of Ohio Edison Company, which are incorporated by reference from the annual report on Form 10-K for the year ending December 31, 2004, are an integral part of the consolidating financial statements.
 
 
                                   
Exhibit F-2
  
OHIO EDISON COMPANY
CONSOLIDATING BALANCE SHEET
As of December 31, 2004
(In thousands $)
                                   
 
  
CAPITALIZATION AND LIABILITIES
  
Ohio Edison Company
  
Pennsylvania Power Company
Consolidated
  
OES Capital, Inc.
  
OES Nuclear, Inc.
  
OES Ventures, Inc.
  
Apollo Tax Credit Fund IX
  
PNBV Capital Trust
  
Eliminations
  
Ohio Edison Company Consolidated
  
                                       
CAPITALIZATION:
                                      
Common stockholders' equity
  
$
2,493,809
  
$
327,379
  
$
28,220
  
$
12,473
  
$
14,573
  
$
14,000
  
$
20,883
  
$
(417,528
)
$
2,493,809
  
Preferred stock not subject to mandatory redemption
    
60,965
   
39,105
   
-
   
-
   
-
   
-
   
-
   
(39,105
)
  
60,965
 
Preferred stock of consolidated subsidiaries--
    
   
   
   
   
   
   
   
   
 
Not subject to mandatory redemption
    
-
   
-
   
-
   
-
   
-
   
-
   
-
   
39,105
   
39,105
 
Long-term debt and other long-term obligations--
                                                        
Preferred stock of consolidated subsidiary
         
                                           
  subject to mandatory redemption
    
-
   
12,000
   
-
   
-
   
-
   
-
   
-
   
-
   
12,000
 
Other
    
1,085,027
   
121,887
   
-
   
109,200
   
-
   
-
   
324,122
   
(537,322
)
  
1,102,914
 
     
3,639,801
   
500,371
   
28,220
   
121,673
   
14,573
   
14,000
   
345,005
   
(954,850
)
  
3,708,793
 
                                                         
CURRENT LIABILITIES:
                                                        
Currently payable long-term debt
    
376,939
   
26,524
   
-
   
-
   
-
   
-
   
-
   
(5,200
)
  
398,263
 
Short-term borrowings--
    
   
   
   
   
   
   
   
   
 
Associated companies
    
3,280
   
11,852
   
-
   
-
   
-
   
-
   
-
   
(3,280
)
  
11,852
 
Other
    
21,000
   
-
   
141,935
   
-
   
-
   
4,072
   
-
   
-
   
167,007
 
Accounts payable--
                                                        
Associated companies
    
143,183
   
46,368
   
97,978
   
-
   
-
   
-
   
2,470
   
(102,078
)
  
187,921
 
Other
    
9,066
   
1,436
   
63
   
-
   
-
   
17
   
-
   
-
   
10,582
 
Accrued taxes
    
136,634
   
14,055
   
2,624
   
87
   
-
   
-
   
-
   
-
   
153,400
 
Accrued interest
    
9,441
   
1,872
   
679
   
-
   
-
   
-
   
-
   
-
   
11,992
 
Other
    
45,549
   
8,802
   
8,274
   
-
   
46
   
-
   
-
   
-
   
62,671
 
     
745,092
   
110,909
   
251,553
   
87
   
46
   
4,089
   
2,470
   
(110,558
)
  
1,003,688
 
                                                         
NONCURRENT LIABILITIES:
                                                        
Accumulated deferred income taxes
    
652,044
   
93,418
   
-
   
22,561
   
-
   
-
   
-
   
(1,747
)
  
766,276
 
Accumulated deferred investment tax credits
    
59,249
   
3,222
   
-
   
-
   
-
   
-
   
-
   
-
   
62,471
 
Asset retirement obligations
    
200,850
   
138,284
   
-
   
-
   
-
   
-
   
-
   
-
   
339,134
 
Retirement benefits
    
258,046
   
49,834
   
-
   
-
   
-
   
-
   
-
   
-
   
307,880
 
Regulatory liabilities
    
-
   
18,454
   
-
   
-
   
-
   
-
   
-
   
-
   
18,454
 
Other
    
258,636
   
6,664
   
-
   
-
   
-
   
236
   
-
   
10,419
   
275,955
 
     
1,428,825
   
309,876
   
-
   
22,561
   
-
   
236
   
-
   
8,672
   
1,770,170
 
                                                         
TOTAL CAPITALIZATION AND LIABILITIES
  
$
5,813,718
  
$
921,156
  
$
279,773
  
$
144,321
  
$
14,619
  
$
18,325
  
$
347,475
  
$
(1,056,736
)
$
6,482,651
  
                                                         
The notes to the consolidated financial statements of Ohio Edison Company, which are incorporated by reference from the annual report on Form 10-K for the year ending December 31, 2004, are an integral part of the consolidating financial statements.
                                                         
 

 
                                       
Exhibit F-2
  
OHIO EDISON COMPANY
 
CONSOLIDATING STATEMENT OF RETAINED EARNINGS
  
As of December 31, 2004
  
(In thousands $)
  
   
 
  
 
  
 
  
 
  
 
  
 
  
 
  
 
      
 
  
 
  
Ohio Edison Company
  
Pennsylvania Power Company
Consolidated
  
OES Capital, Inc.
  
OES Finance, Inc.
  
OES Nuclear, Inc.
  
OES Ventures, Inc.
  
Apollo Tax Credit Fund IX
  
PNBV Capital Trust
  
 
 
Eliminations
  
Ohio Edison Company Consolidated
  
                                           
RETAINED EARNINGS:
                                          
Balance - Beginning of Period
  
$
522,934
  
$
54,179
  
$
4,576
  
$
2,488
  
$
9,509
  
$
2,614
  
$
(13,152
)
$
-
  
$
(60,214
)
$
522,934
  
                                                               
Net Income
    
342,766
   
59,076
   
3,644
   
450
   
2,954
   
958
   
(3,578
)
  
1,763
   
(65,267
)
  
342,766
 
                                                               
Common Stock Dividends Declared
    
(421,000
)
  
(23,000
)
  
-
   
(2,938
)
  
-
   
-
   
-
   
-
   
25,938
   
(421,000
)
                                                               
Preferred Stock Dividends Declared
    
(2,502
)
  
(2,560
)
  
-
    -     -      -      -      -    
2,560
   
(2,502
)
                                                               
Other
    
-
   
-
   
-
   
-
   
-
   
-
   
-
   
(1,619
)
  
1,619
   
-
 
                                                               
Balance - End of Period
  
$
442,198
  
$
87,695
  
$
8,220
  
$
-
  
$
12,463
  
$
3,572
  
$
(16,730
)
$
144
  
$
(95,364
)
$
442,198
  
                                                               
                                                               
                                                               
ACCUMULATED OTHER COMPREHENSIVE INCOME:
                                                              
Balance - Beginning of Period
  
$
(38,693
)
$
(11,783
)
$
-
  
$
-
  
$
-
  
$
-
  
$
-
  
$
-
  
$
11,783
  
$
(38,693
)
                                                               
Unrealized gain on investments
    
(873
)
  
-
   
-
   
-
   
-
   
-
   
-
   
-
   
-
   
(873
)
                                                               
Minimum liability for unfunded retirement benefits
    
(7,552
)
  
(1,923
)
    -      -      -      -      -      -    
1,923
   
(7,552
)
                                                               
Balance - End of Period
  
$
(47,118
)
$
(13,706
)
$
-
  
$
-
  
$
-
  
$
-
  
$
-
  
$
-
  
$
13,706
  
$
(47,118
)
                                                               
                                                               
The notes to the consolidated financial statements of Ohio Edison Company, which are incorporated by reference from the annual report on Form 10-K for the year ending December 31, 2004, are an integral part of the consolidating financial statements.
                                                               
 
 
                                       
Exhibit F-2
  
OHIO EDISON COMPANY
CONSOLIDATING STATEMENTS OF CASH FLOWS
 
For the Year Ended December 31, 2004
(In thousands $)
 
                                  
 
  
 
  
   
Ohio Edison Company
  
Pennsylvania Power Company
Consolidated
  
OES Capital, Inc.
  
OES Finance, Inc.
  
OES Nuclear, Inc.
  
OES Ventures, Inc.
  
Apollo Tax Credit Fund IX
  
PNBV Capital Trust
  
Eliminations
  
Ohio Edison Company Consolidated
  
CASH FLOWS FROM OPERATING ACTIVITIES:
                                          
Net Income
  
$
342,766
  
$
59,076
  
$
3,644
  
$
450
  
$
2,954
  
$
958
  
$
(3,578
)
$
1,763
  
$
(65,267
)
$
342,766
  
Adjustments to reconcile net income
                                                             
to net cash from operating activities--
                                                              
Provision for depreciation 
    
107,914
   
14,134
   
101
   
0
   
264
   
-
   
-
   
-
   
-
   
122,413
 
Amortization of regulatory assets 
    
371,314
   
40,012
   
-
   
-
   
-
   
-
   
-
   
-
   
-
   
411,326
 
Deferral of new regulatory assets 
    
(100,633
)
  
0
   
-
   
-
   
-
   
-
   
-
   
-
   
-
   
(100,633
)
Nuclear fuel and lease amortization 
    
31,221
   
16,790
   
-
   
-
   
-
   
-
   
-
   
-
   
(5,200
)
  
42,811
 
Undistributed subsidiary earnings 
    
(35,007
)
  
0
   
-
   
-
   
-
   
-
   
-
   
-
   
35,007
   
-
 
Deferred income taxes and investment tax
  credits, net 
    
(52,028
)
  
5,011
   
463
   
-
   
1,977
   
108
   
-
   
-
   
-
   
(44,469
)
Deferred lease costs 
    
(5,170
)
  
0
   
-
   
-
   
-
   
-
   
-
   
-
   
-
   
(5,170
)
Accrued retirement benefit obligations 
    
26,685
   
4,604
   
-
   
-
   
-
   
-
   
-
   
-
   
-
   
31,289
 
Accrued compensation, net  
    
3,961
   
590
   
-
   
-
   
-
   
-
   
-
   
-
   
-
   
4,551
 
Pension trust contribution 
    
(59,829
)
  
(12,934
)
  
-
   
-
   
-
   
-
   
-
   
-
   
-
   
(72,763
)
Decrease (increase) in operating assets: 
                                                              
 Receivables
    
342,139
   
1,919
   
(75,117
)
  
9,866
   
14,037
   
(938
)
  
(217
)
  
195
   
(82,754
)
  
209,130
 
 Materials and supplies
    
(6,254
)
  
(4,005
)
  
-
   
-
   
-
   
-
   
-
   
-
   
-
   
(10,259
)
 Prepayments & other current assets
    
762
   
459
   
76
   
-
   
-
   
(11
)
  
-
   
-
   
-
   
1,286
 
Increase (decrease) in operating liabilities: 
                                                              
 Accounts payable
    
(88,215
)
  
6,338
   
85,311
   
(20,912
)
  
-
   
(154
)
  
(2
)
  
(183
)
  
(62,921
)
  
(80,738
)
 Accrued taxes
    
(392,518
)
  
(13,036
)
  
(599
)
  
(156
)
  
54
   
(691
)
  
-
   
-
   
1
   
(406,945
)
 Accrued interest
    
(4,878
)
  
(2,524
)
  
679
   
-
   
-
   
-
   
-
   
-
   
1
   
(6,722
)
Other 
    
(15,434
)
  
(1,339
)
  
(1,346
)
  
17
   
-
   
(57
)
  
149
   
(55
)
  
(1
)
  
(18,066
)
Net cash provided from (used for) operating
 activities
    
466,796
   
115,095
   
13,212
   
(10,735
)
  
19,286
   
(785
)
  
(3,648
)
  
1,720
   
(181,134
)
  
419,807
 
                                                               
CASH FLOWS FROM FINANCING ACTIVITIES:
                                                    
       
New Financing--
                                                              
Long-term debt
   
30,000
   
-
   
-
   
-
   
-
   
-
   
-
   
-
   
-
   
30,000
 
Short-term borrowings, net
    
-
   
518
   
-
   
-
   
-
   
-
   
-
   
-
   
(518
)
  
-
 
Equity contributions from parent
    
-
   
65,000
   
-
   
(14,000
)
  
-
   
-
   
-
   
-
   
(51,000
)
  
-
 
Redemptions and Repayments--
    
   
   
   
   
   
   
   
   
   
 
Preferred stock
    
-
   
(750
)
  
-
   
-
   
-
   
-
   
-
   
-
   
-
   
(750
)
Long-term debt
    
(112,294
)
  
(63,903
)
  
-
   
(263,763
)
  
(5,200
)
  
-
   
-
   
(25,491
)
  
299,654
   
(170,997
)
Short-term borrowings, net
    
3,512
         
(7,754
)
  
-
   
-
   
-
   
(778
)
  
-
   
1,005
   
(4,015
)
Dividend Payments--
    
   
   
   
   
   
   
   
   
   
 
Common stock
    
(421,000
)
  
(23,000
)
  
-
   
(2,938
)
  
-
   
-
   
-
   
-
   
25,938
   
(421,000
)
Preferred stock
    
(2,502
)
  
(2,560
)
  
-
   
-
   
-
   
-
   
-
   
-
   
2,560
   
(2,502
)
Net cash provided from (used for) financing
 activities 
    
(502,284
)
  
(24,695
)
  
(7,754
)
  
(280,701
)
  
(5,200
)
  
-
   
(778
)
  
(25,491
)
  
277,639
   
(569,264
)
                                                               
CASH FLOWS FROM INVESTING ACTIVITIES:
                                                              
Property additions
    
(141,702
)
  
(93,320
)
  
-
   
-
   
-
   
-
   
-
   
-
   
-
   
(235,022
)
Proceeds from sale of assets
    
253
   
-
   
-
   
-
   
-
   
-
   
-
   
-
   
-
   
253
 
Proceeds from certificates of deposit
    
-
     -    
-
   
277,763
   
-
   
-
   
-
   
-
   
-
   
277,763
 
Contributions to nuclear decommissioning
 trusts
    
(29,945
)
  
(1,594
)
  
-
   
-
   
-
   
-
   
-
   
-
   
(1
)
  
(31,540
)
Loan repayments from (loans to) associated
 companies, net
    
(17,815
)
  
6,162
   
(5,544
)
  
13,673
   
(14,086
)
  
(11
)
  
488
   
-
   
145,187
   
128,054
 
Asset retirements and transfers
    
(21,831
)
  
(2,996
)
  
(267
)
   -    
-
   
-
   
-
   
-
   
-
   
(25,094
)
Other investments
    
246,511
   
1,346
   
352
   
0
   
-
   
796
   
3,320
   
23,756
   
(241,691
)
  
34,390
 
Net cash provided from (used for) investing
 activities 
    
35,471
   
(90,402
)
  
(5,459
)
  
291,436
   
(14,086
)
  
785
   
3,808
   
23,756
   
(96,505
)
  
148,804
 
                                                               
NET DECREASE IN CASH AND CASH EQUIVALENTS
  
$
(17
)
$
(2
)
$
(1
)
$
-
  
$
-
  
$
-
  
$
(618
)
$
(15
)
$
-
  
$
(653
)
                                                               
The notes to the consolidated financial statements of Ohio Edison Company, which are incorporated by reference from the annual report on Form 10-K for the year ending December 31, 2004, are an integral part of the consolidating financial statements.
                                                             
 
 
 

                                
Exhibit F-2
 
 Pennsylvania Electric Company 
 Consolidating Statement of Income 
 For the Year ending December 31, 2004 
 (In Thousands) 
                                    
        
Pennsylvania Electric Company
 
Penelec Preferred Capital II, Inc.
 
Penelec Funding LLC
 
Nineveh Water Company
 
Waverly Elec. Light and Power Company
 
Eliminations and Adjustments
 
Pennsylvania Electric Company Consolidated
 
                                    
OPERATING REVENUES 
        
$
1,036,264
    
 
$
14,583
    
       
$
(14,777
)
$
1,036,070
  
                                                   
OPERATING EXPENSES AND TAXES: 
                                                  
Purchased Power 
          
570,369
   
     -    
         
-
    
570,369
 
Other Operating Expenses 
          
192,736
   
   
4,527
   
         
(194
)
  
197,069
 
Total Operating and Maintenance Expenses 
          
763,105
   
   
4,527
   
         
(194
)
  
767,438
 
                 
                               
Provision for Depreciation 
          
47,104
   
     -    
         
-
    
47,104
 
Amortization of Regulatory Assets 
          
50,403
   
    -    
         
-
    
50,403
 
General Taxes 
          
68,122
   
     -  
$
10
          
-
    
68,132
 
Income Taxes 
          
29,390
   
     -    
(77
)
          -    
29,313
 
Total Operating Expenses and Taxes 
          
958,124
   
   
4,527
   
(67
)
        
(194
)
  
962,390
 
                 
                               
OPERATING INCOME 
          
78,140
   
   
10,056
   
67
         
(14,583
)
  
73,680
 
                                                   
Other income 
          
7,791
 
$
5
    
14
   
(11
)
        
(2,599
)
  
5,200
 
Equity Earnings 
          
6,982
           -    
-
          
(6,982
)
  
0
 
Other Income Deductions 
          
(16,763
)
  
(6
)
    -    
-
          
14,584
   
(2,185
)
Other Income Depreciation 
          
(12
)
    -      -      -            -    
(12
)
Taxes - Other Income Deductions 
          
(688
)
    -      -    
-
            -    
(688
)
OTHER INCOME 
          
(2,690
)
  
(1
)
  
14
   
(11
)
        
5,003
   
2,315
 
                                                   
NET INTEREST CHARGES: 
                                                  
Interest On Long-Term Debt 
          
30,029
         -    
 
          
-
    
30,029
 
Allowance for Borrowed Funds Used During 
                
                               
Construction and Capitalized Interest 
          
(248
)
  
 
      -    
 
          
-
    
(248
)
Deferred Interest Income 
          
190
   
 
      -    
 
          
-
    
190
 
Other Interest Expense 
          
9,449
       
3,144
             
(2,599
)
  
9,994
 
Net Interest Charges 
          
39,420
       
3,144
               
(2,599
)
  
39,965
 
                                                   
NET INCOME/ (LOSS) 
          
36,030
   
(1
)
  
6,926
   
56
         
(6,981
)
  
36,030
 
Preferred Stock Dividend Requirements 
          
-
   
170
   
-
   
-
   
-
   
(170
)
  
-
 
EARNINGS ON COMMON STOCK 
        
$
36,030
  
$
(171
)
$
6,926
  
$
56
  
$
-
  
$
(6,811
)
$
36,030
  
                                                   
The notes to the consolidated financial statements of Pennsylvania Electric Company, which are incorporated by reference from the annual report on Form 10-K for the year end December 31, 2004, are an integral part of the consolidating financial statements. 
                                                   
 
 

                           
Exhibit F-2
 
Pennsylvania Electric Company
Consolidating Balance Sheet
As of December 31, 2004
(In Thousands)
                               
   
Pennsylvania Electric Company
 
Penelec Preferred Capital II, Inc.
 
Penelec Funding LLC
 
Nineveh Water Company
 
Waverly Elec. Light and Power Company
 
Eliminations and Adjustments
 
Pennsylvania Electric Company Consolidated
 
                               
ASSETS
                              
UTILITY PLANT:
                                            
In Service
  
$
1,981,831
                    
$
15
        
$
1,981,846
  
Less - Total Accum Provision For Depreciation
    
(776,904
)
                      -          
(776,904
)
Net Utility Plant excluding Construction Work In Progress
    
1,204,927
                     
15
         
1,204,942
 
Construction Work In Progress
    
22,816
                       -        
22,816
 
Net Utility Plant
    
1,227,743
                     
15
         
1,227,758
 
                                             
OTHER PROPERTY & INVESTMENTS:
                                            
Nuclear Plant Decommissioning Trust
    
109,620
                       -          
109,620
 
Non Utility Generation Trust
    
95,991
                       -          
95,991
 
Long-term Notes Receivable from Associated Company
    
14,001
                       -          
14,001
 
Investments in Subsidiaries
    
14,883
                       -  
$
(14,883
)
  
-
 
Nonutility Plant, Net
    
744
                       -      -    
744
 
Other
    
15,506
 
$
2,496
                  -      -    
18,002
 
     
250,745
   
2,496
                 -    
(14,883
)
  
238,358
 
                                             
CURRENT ASSETS:
                                            
Cash and Cash Equivalents
    
35
   
1
                -    -    
36
 
Receivables:
                                            
Customers
    
87,777
    -  
$
33,335
            -      -  
121,112
 
Associated Companies
    
97,528
     -    
13,670
 
$
1,768
     -    
(15,438
)
  
97,528
 
Other
    
12,773
   
5
     -    
0
     -          
12,778
 
Notes Receivable From Associated Co.
    
24,200
     -    
7,352
     -      -    
(24,200
)
  
7,352
 
Prepayments and Other
    
7,136
     -    
62
    -      -      -    
7,198
 
     
229,449
   
6
   
54,419
   
1,768
   
-
   
(39,638
)
  
246,004
 
                                             
DEFERRED CHARGES:
                                            
Goodwill
    
888,011
    -      -      -      -      -    
888,011
 
Regulatory Assets
    
200,173
     -      -      -    -      -    
200,173
 
Accumulated Deferred Income Taxes
    
694,660
     -      -    
91
     -  
(694,751
)
  
-
 
Other
    
13,448
    -     -      -      -    
-
    
13,448
 
     
1,796,292
   
-
   
-
   
91
   
-
    
(694,751
)
  
1,101,632
 
TOTAL ASSETS
  
$
3,504,229
  
$
2,502
  
$
54,419
  
$
1,859
  
$
15
  
$
(749,272
)
$
2,813,752
  
                                             
The notes to the consolidated financial statements of Pennsylvania Electric Company, which are incorporated by reference from the annual report on Form 10-K for the year end December 31, 2004, are an integral part of the consolidating financial statements.
                                           
 
 
                           
Exhibit F-2
 
Pennsylvania Electric Company
  
Consolidating Balance Sheet
As of December 31, 2004
(In Thousands)
  
                               
   
Pennsylvania Electric Company
 
Penelec Preferred Capital II, Inc.
 
Penelec Funding LLC
 
Nineveh Water Company
 
Waverly Elec. Light and Power Company
 
Eliminations and Adjustments
 
Pennsylvania Electric Company Consolidated
 
                               
CAPITALIZATION & LIABILITIES
                              
                               
CAPITALIZATION:
                                            
Common Stockholder's Equity
  
$
1,305,015
  
$
2,248
  
$
11,407
  
$
1,213
  
$
15
  
$
(14,883
)
$
1,305,015
  
Long-Term Debt and Other Long-Term Obligations
    
481,871
                                 
481,871
 
     
1,786,886
   
2,248
   
11,407
   
1,213
   
15
   
(14,883
)
  
1,786,886
 
                                             
CURRENT LIABILITIES:
                                            
Currently Payable Long-Term Debt
   
8,248
    -      -      -     -     -    
8,248
 
Short-term borrowings-
                                            
Associated Companies
    
241,496
     -    
24,200
     -      -    
(24,200
)
  
241,496
 
Accounts Payable-
                                            
Associated Companies
    
57,455
   
57
   
14,067
   
13
    -    
(15,438
)
  
56,154
 
Other
    
25,870
     -    
90
     -      -      -    
25,960
 
Accrued Taxes
    
7,294
   
197
     -    
508
     -      -    
7,999
 
Accrued Interest
    
9,435
     -    
135
   
125
     -      -    
9,695
 
Other
    
19,230
    -    
4,520
    -     -     -    
23,750
 
     
369,028
   
254
   
43,012
   
646
   
-
   
(39,638
)
  
373,302
 
                                             
NONCURRENT LIABILITIES:
                                            
Power Purchase Contract Loss Liability
    
382,548
     -      -     -      -      -    
382,548
 
Asset Retirement Obligation
    
66,443
     -      -     -      -     -    
66,443
 
Accumulated Deferred Income Taxes
    
732,069
     -     -      -      -    
(694,751
)
  
37,318
 
Retirement Benefits
    
118,247
     -      -      -      -      -    
118,247
 
Other
    
49,008
     -    -      -      -      -    
49,008
 
     
1,348,315
    -     -     -     -    
(694,751
)
  
653,564
 
                                             
TOTAL CAPITALIZATION & LIABILITIES
  
$
3,504,229
  
$
2,502
  
$
54,419
  
$
1,859
  
$
15
  
$
(749,272
)
$
2,813,752
  
                                             
The notes to the consolidated financial statements of Pennsylvania Electric Company, which are incorporated by reference from the annual report on Form 10-K for the year end December 31, 2004, are an integral part of the consolidating financial statements.
                                 
       
 

 
                           
Exhibit F-2
 
                               
Pennsylvania Electric Company
Consolidating Statement of Retained Earnings
For the Year ending December 31, 2004
(In Thousands)
                               
   
Pennsylvania Electric Company
 
Penelec Preferred Capital II, Inc.
 
Penelec Funding LLC
 
Nineveh Water Company
 
Waverly Elec. Light and Power Company
 
Eliminations and Adjustments
 
Pennsylvania Electric Company Consolidated
 
                               
Balance at beginning of year
  
$
18,038
  
$
(489
)
$
-
  
$
(34
)
  $  -
$
523
  
$
18,038
  
                                             
Net Income
    
36,030
   
(1
)
  
6,926
   
56
   
-
   
(6,981
)
  
36,030
 
                                             
Cash dividends declared on common stock
    
(8,000
)
  
(170
)
   -     -      -  
170
   
(8,000
)
             -                              
Balance at end of year
  
$
46,068
  
$
(660
)
$
6,926
  
$
23
  
$
-
  
$
(6,288
)
$
46,068
  
                                             
                                             
                                             
Pennsylvania Electric Company
Consolidating Accumulated Other Comprehensive Income
For the Year ending December 31, 2004
(In Thousands)
                                             
 
 
 Pennsylvania Electric Company
    
Penelec Preferred Capital II, Inc.
 
 
Penelec Funding LLC
 
 
Nineveh Water Company
 
 
Waverly Elec. Light and Company
 
 
Eliminations and Adjustments
 
 
Pennsylvania Electric Company Consolidated
 
                                             
Balance - Beginning of year
  
$
(42,185
)
$
-
  
$
-
  
$
-
  
$
-
  
$
-
  
$
(42,185
)
                                             
Unrealized loss on investments
    
(4
)
   -     -     -      -     -    
(4
)
                                             
Unrealized loss on derivative instruments
    
(351
)
   -      -      -      -      -    
(351
)
                                             
Minimum liability for unfunded retirement benefits
    
(10,273
)
   -      -      -      -      -    
(10,273
)
                                             
Balance - End of year
  
$
(52,813
)
$
-
  
$
-
  
$
-
  
$
-
  
$
-
  
$
(52,813
)
                                             
                                             
The notes to the consolidated financial statements of Pennsylvania Electric Company, which are incorporated by reference from the annual report on Form 10-K for the year end December 31, 2004, are an integral part of the consolidating financial statements.
                                           
 

 
                           
Exhibit F-2
 
Pennsylvania Electric Company
Consolidating Statement of Cash Flows
For the year ending December 31, 2004
(In Thousands)
                               
   
Pennsylvania Electric Company
 
Penelec Preferred Capital II, Inc.
 
Penelec Funding LLC
 
Nineveh Water Company
 
Waverly Elec. Light and Power Company
 
Eliminations and Adjustments
 
Pennsylvania Electric Company Consolidated
 
                               
CASH FLOWS FROM OPERATING ACTIVITIES:
                              
 
  
 
                          
Net Income
  
$
36,030
  
$
(1
)
$
6,927
  
$
56
  
$
-
  
$
(6,982
)
$
36,030
  
Adjustments to reconcile net income to net cash
                                            
 from operating activities:
                                            
Equity in earnings of subsidiary
    
(6,982
)
   -      -     -      -    
6,982
     -  
Provision for depreciation
    
47,104
     -      -      -      -    -    
47,104
 
Amortization of regulatory assets
    
50,403
     -      -      -      -      -    
50,403
 
Deferred costs recoverable as regulatory assets
    
(87,379
)
    -      -      -      -      -    
(87,379
)
Deferred income taxes and investment tax credits, net
    
77,447
     -      -    
(72
)
    -      -    
77,375
 
Accrued retirement benefit obligations
    
5,822
     -      -      -      -      -    
5,822
 
Accrued compensation, net
    
3,226
     -      -      -      -      -    
3,226
 
Pension trust contribution
    
(50,281
)
    -      -      -      -      -    
(50,281
)
Decrease (Increase) in operating assets:
                                            
Receivables
    
30,749
   
(5
)
  
(47,006
)
  
1
     -    
13,670
   
(2,591
)
Prepayments and other current assets
    
(4,626
)
    -    
(61
)
    -      -      -    
(4,687
)
Increase (Decrease) in operating liabilities:
                                            
Accounts payable
    
(14,405
)
  
4
   
14,157
   
5
     -    
(13,670
)
  
(13,909
)
Accrued taxes
    
(707
)
  
2
     -                      
(705
)
Accrued interest
    
(3,009
)
    -      -    
10
     -      -    
(2,999
)
Other
    
(15,940
)
    -    
4,654
     -      -    
170
   
(11,116
)
     
                                     
Net cash provided from (used for) operating activities
    
67,452
   
(0
)
  
(21,329
)
  
(0
)
  
-
   
170
   
46,293
 
                                             
CASH FLOWS FROM FINANCING ACTIVITIES:
                                            
 
                                            
New Financing-
                                            
Long-term debt
    
150,000
     -      -      -      -      -  
150,000
 
Short-term borrowings, net
    
162,986
     -    
24,200
     -      -    
(24,200
)
  
162,986
 
Equity contributions from parent
    
-
     -    
4,481
     -      -    
(4,481
)
  
-
 
Redemptions and Repayments-
                                            
Long-term debt
    
(228,670
)
    -      -      -      -      -    
(228,670
)
Dividend Payments
                                            
Common Stock
    
(8,000
)
   -      -      -      -      -    
(8,000
)
Preferred Stock Dividend Requirements
    
170
   
170
     -      -      -    
(340
)
    -  
Common stock - internal
    
-
   
(170
)
    -      -      -    
170
   
-
 
     
                                     
Net cash provided from (used for) financing activities
    
76,486
   
-
   
28,681
   
-
   
-
   
(28,851
)
  
76,316
 
                                             
CASH FLOWS FROM INVESTING ACTIVITIES:
                                            
 
                                            
Property additions
    
(51,801
)
    -      -     -      -      -    
(51,801
)
Nonutility generation trusts contributions
    
(50,614
)
    -      -      -      -      -    
(50,614
)
Loan payments to associated companies, net
    
(24,407
)
    -    
(7,352
)
    -      -    
24,200
   
(7,559
)
Investment in subsidiary
    
(4,481
)
    -      -      -      -    
4,481
   
-
 
Other
    
(12,635
)
    -      -      -      -    
-
   
(12,635
)
     
                                     
Net Cash provided from (used for) investing activities
    
(143,938
)
  
-
   
(7,352
)
  
-
   
-
   
28,681
   
(122,609
)
 
    
                                     
Net change in cash and cash equivalents
  
$
0
  
$
0
  
$
0
  
$
0
  
$
0
  
$
0
  
$
0
  
                                             
The notes to the consolidated financial statements of Pennsylvania Electric Company, which are incorporated by reference from the annual report on Form 10-K for the year end December 31, 2004, are an integral part of the consolidating financial statements.
 
 

               
Exhibit F-2
  
PENNSYLVANIA POWER COMPANY
 
CONSOLIDATING INCOME STATEMENT
  
For the Year Ended December 31, 2004
  
(In thousands $)
  
                   
   
Pennsylvania
 
 
  
 
  
Pennsylvania
 
 
  
Power
  
Penn Power
 
 
  
Power
  
 
  
Company
  
Funding LLC
  
Eliminations
  
Consolidated
  
                   
OPERATING REVENUES
  
$
549,196
  
$
3,045
  
$
(3,120
)
$
549,121
  
                           
OPERATING EXPENSES AND TAXES:
                          
Fuel
    
22,894
   
-
   
-
   
22,894
 
Purchased power
    
181,031
   
-
   
-
   
181,031
 
Nuclear operating costs
    
106,659
   
-
   
-
   
106,659
 
Other operating expenses
    
49,078
   
2,177
   
(75
)
  
51,180
 
Provision for depreciation
    
14,134
   
-
   
-
   
14,134
 
Amortization of regulatory assets
    
40,012
   
-
   
-
   
40,012
 
General taxes
    
23,607
   
-
   
-
   
23,607
 
Income taxes
    
48,824
   
-
   
-
   
48,824
 
Total operating expenses and taxes
    
486,239
   
2,177
   
(75
)
  
488,341
 
                           
OPERATING INCOME
    
62,957
   
868
   
(3,045
)
  
60,780
 
                           
Equity in subsidiary earnings
    
(467
)
  
-
   
467
   
-
 
Other income
    
2,651
   
-
   
1,741
   
4,392
 
Other income taxes
    
(928
)
  
-
   
-
   
(928
)
OTHER INCOME
    
1,256
   
-
   
2,208
   
3,464
 
                           
NET INTEREST CHARGES:
                          
Interest on long-term debt
    
8,250
   
-
   
-
   
8,250
 
AFUDC - borrowed funds
    
(4,563
)
  
-
   
-
   
(4,563
)
Other interest expense
    
1,450
   
1,335
   
(1,304
)
  
1,481
 
Net interest charges
    
5,137
   
1,335
   
(1,304
)
  
5,168
 
                           
NET INCOME
    
59,076
   
(467
)
  
467
   
59,076
 
                           
PREFERRED STOCK
                          
DIVIDEND REQUIREMENTS
    
2,560
   
-
   
-
   
2,560
 
                           
EARNINGS ON COMMON STOCK
  
$
56,516
  
$
(467
)
$
467
  
$
56,516
  
                           
The notes to the consolidated financial statements of Pennsylvania Power Company, which are incorporated by reference from the annual report on Form 10-K for the year ended December 31, 2004, are an integral part of the consolidating financial statements. 
                         
 

                   
Exhibit F-2
  
                       
 PENNSYLVANIA POWER COMPANY
 CONSOLIDATING BALANCE SHEETS
 As of December 31, 2004
 (In thousands $)
                       
       
Pennsylvania
  
 
  
 
  
Pennsylvania
  
 
  
 
  
Power
  
Penn Power
  
 
  
Power
  
ASSETS
    
Company
  
Funding LLC
  
Eliminations
  
Consolidated
  
                       
UTILITY PLANT:
                    
In service
        
$
866,303
  
$
-
  
$
-
  
$
866,303
  
Less--Accumulated provision for depreciation
          
356,020
   
-
   
-
   
356,020
 
           
510,283
   
-
   
-
   
510,283
 
Construction work in progress
          
107,728
               
107,728
 
           
618,011
   
-
   
-
   
618,011
 
                                 
OTHER PROPERTY AND INVESTMENTS:
                                
Nuclear plant decommissioning trusts
          
143,062
   
-
   
-
   
143,062
 
Long-term notes receivable from associated companies
          
32,985
   
-
   
-
   
32,985
 
Other
          
2,247
   
-
   
(1,525
)
  
722
 
           
178,294
   
-
   
(1,525
)
  
176,769
 
                                 
CURRENT ASSETS:
                                
Cash and cash equivalents
          
38
   
-
   
-
   
38
 
Receivables-
                                
Customers
          
28,606
   
15,676
   
-
   
44,282
 
Associated companies
         
23,413
   
-
   
(397
)
  
23,016
 
Other
          
1,656
   
-
   
-
   
1,656
 
Notes receivable from associated companies
          
13,240
   
-
   
(12,809
)
  
431
 
Material and supplies
          
37,923
   
-
   
-
   
37,923
 
Prepayments and other
          
8,906
   
18
   
-
   
8,924
 
           
113,782
   
15,694
   
(13,206
)
  
116,270
 
                                 
DEFERRED CHARGES:
                                
Other
          
10,106
   
-
   
-
   
10,106
 
           
10,106
   
-
   
-
   
10,106
 
                                 
TOTAL ASSETS
        
$
920,193
  
$
15,694
  
$
(14,731
)
$
921,156
  
                                 
The notes to the consolidated financial statements of Pennsylvania Power Company, which are incorporated by reference from the annual report on Form 10-K for the year ended December 31, 2004, are an integral part of the consolidating financial statements.
                               
 

                   
Exhibit F-2
  
                       
 PENNSYLVANIA POWER COMPANY
 CONSOLIDATING BALANCE SHEETS
 As of December 31, 2004
 (In thousands $)
                       
       
Pennsylvania
 
 
 
 
 
Pennsylvania
 
 
 
 
 
Power
 
Penn Power
 
 
 
Power
 
CAPITALIZATION AND LIABILITIES 
  
 
  
Company
  
Funding LLC
  
Eliminations
  
Consolidated
  
                       
CAPITALIZATION:
  
 
                  
Common stockholder's equity
        
$
327,379
  
$
1,525
  
$
(1,525
)
$
327,379
  
Preferred stock not subject to mandatory redemption
          
39,105
   
-
   
-
   
39,105
 
Long-term debt and other long-term obligations
          
133,887
   
-
   
-
   
133,887
 
           
500,371
   
1,525
   
(1,525
)
  
500,371
 
                                 
CURRENT LIABILITIES:
                                
Currently payable long-term debt
          
26,524
   
-
   
-
   
26,524
 
Accounts payable-
                                
Associated companies
          
46,348
   
417
   
(397
)
  
46,368
 
Other
          
1,430
   
6
   
-
   
1,436
 
Notes payable to associated companies
          
11,789
   
12,872
   
(12,809
)
  
11,852
 
Accrued taxes
          
14,055
   
-
   
-
   
14,055
 
Accrued interest
          
1,872
   
-
   
-
   
1,872
 
Other
          
7,928
   
874
   
-
   
8,802
 
           
109,946
   
14,169
   
(13,206
)
  
110,909
 
                                 
NONCURRENT LIABILITIES:
                                
Accumulated deferred income taxes
          
93,418
   
-
   
-
   
93,418
 
Accumulated deferred investment tax credits
          
3,222
   
-
   
-
   
3,222
 
Asset retirement obligation
          
138,284
   
-
   
-
   
138,284
 
Retirement benefits
          
49,834
   
-
   
-
   
49,834
 
Regulatory liabilities
          
18,454
   
-
   
-
   
18,454
 
Other
          
6,664
   
-
   
-
   
6,664
 
           
309,876
   
-
   
-
   
309,876
 
                                 
TOTAL CAPITALIZATION AND LIABILITIES
        
$
920,193
  
$
15,694
  
$
(14,731
)
$
921,156
  
                                 
The notes to the consolidated financial statements of Pennsylvania Power Company, which are incorporated by reference from the annual report on Form 10-K for the year ended December 31, 2004, are an integral part of the consolidating financial statements.
 

 
               
Exhibit F-2
  
                   
PENNSYLVANIA POWER COMPANY
CONSOLIDATING STATEMENT OF RETAINED EARNINGS
For the Year Ended December 31, 2004
(In thousands $)
                   
   
Pennsylvania
          
Pennsylvania
  
   
Power
  
Penn Power
     
Power
  
   
Company
  
Funding LLC
  
Eliminations
  
Consolidated
  
RETAINED EARNINGS:
                  
                   
Balance - Beginning of Period
  
$
54,179
  
$
-
  
$
-
    
54,179
 
                           
Net Income
    
59,076
   
(467
)
  
467
   
59,076
 
                           
Common Stock Dividends Declared
    
(23,000
)
  
-
   
-
   
(23,000
)
                           
Preferred Stock Dividends Declared
    
(2,560
)
  
-
   
-
   
(2,560
)
                           
Balance - End of Period
  
$
87,695
  
$
(467
)
$
467
  
$
87,695
  
                           
                           
ACCUMULATED OTHER COMPREHENSIVE INCOME:
                          
                           
Balance - Beginning of Period
  
$
(11,783
)
$
-
  
$
-
    
(11,783
)
                           
Minimum Liability for Unfunded
                          
Retirement Benefits
    
(1,923
)
  
-
   
-
   
(1,923
)
                           
Balance - End of Period
  
$
(13,706
)
$
-
  
$
-
  
$
(13,706
)
                           
The notes to the consolidated financial statements of Pennsylvania Power Company, which are incorporated by reference from the annual report 
on Form 10-K for the year ended December 31, 2004, are an integral part of the consolidating financial statements.
 

               
Exhibit F-2
  
PENNSLVANIA POWER COMPANY
CONSOLIDATING STATEMENTS OF CASH FLOWS
For the Year Ended December 31, 2004
(In thousands $)
 
          
 
      
 
  
Pennsylvania
 
 
 
 
 
Pennsylvania
 
 
 
Power
 
Penn Power
 
 
 
Power
 
 
 
Company
 
Funding LLC
 
Eliminations
 
Consolidated
  
CASH FLOWS FROM OPERATING ACTIVITIES:
                  
Net income
  
$
59,076
  
$
(467
)
$
467
  
$
59,076
  
Adjustments to reconcile net income
                         
  to net cash from operating activities--
                          
Provision for depreciation
 
 
14,134
 
 
-
 
 
-
 
 
14,134
 
Amortization of regulatory assets
 
 
40,012
 
 
-
 
 
-
 
 
40,012
 
Nuclear fuel and lease amortization
 
 
16,790
 
 
-
 
 
-
 
 
16,790
 
Undistributed subsidiary earnings
 
 
467
 
 
-
 
 
(467
)
 
-
 
Deferred income taxes and investment tax credits, net
 
 
5,011
 
 
-
 
 
-
 
 
5,011
 
Pension trust contribution
 
 
(12,934
)
 
-
 
 
-
 
 
(12,934
)
Decrease (Increase) in operating assets:
 
 
 
 
 
 
 
 
 
 
 
 
 
   Receivables
 
 
17,198
 
 
(15,676
)
 
397
 
 
1,919
 
   Materials and supplies
 
 
(4,005
)
 
-
 
 
-
 
 
(4,005
)
   Prepayments and other current assets
 
 
477
 
 
(18
)
 
-
 
 
459
 
Increase (Decrease) in operating liabilities:
 
 
 
 
 
 
 
 
 
 
 
 
 
   Accounts payable
 
 
6,312
 
 
423
 
 
(397
)
 
6,338
 
   Accrued taxes
 
 
(13,036
)
 
-
 
 
-
 
 
(13,036
)
   Accrued interest
 
 
(2,524
)
 
-
 
 
-
 
 
(2,524
)
Asset retirement obligation, net
 
 
(1,242
)
 
-
 
 
-
 
 
(1,242
)
Other
    
4,223
   
874
   
-
   
5,097
 
Net cash provided from (used for) operating activities
    
129,959
   
(14,864
)
  
-
   
115,095
 
                           
CASH FLOWS FROM FINANCING ACTIVITIES:
                          
New Financing--
                          
Short-term borrowings, net
    
456
   
12,871
   
(12,809
)
  
518
 
Equity contribution from parent
    
65,000
   
1,993
   
(1,993
)
  
65,000
 
Redemptions and Repayments--
                          
Preferred stock
    
(750
)
  
-
   
-
   
(750
)
Long-term debt
    
(63,903
)
  
-
   
-
   
(63,903
)
Dividend Payments--
                          
Common stock
    
(23,000
)
  
-
   
-
   
(23,000
)
Preferred stock
    
(2,560
)
  
-
   
-
   
(2,560
)
Net cash provided from (used for) financing activities
    
(24,757
)
  
14,864
   
(14,802
)
  
(24,695
)
                           
CASH FLOWS FROM INVESTING ACTIVITIES:
                          
Property additions
    
(93,320
)
  
-
   
-
   
(93,320
)
Loan payments from (to) associated companies, net
    
(6,647
)
  
-
   
12,809
   
6,162
 
Contributions to nuclear decommissioning trusts
    
(1,594
)
  
-
   
-
   
(1,594
)
Investment in subsidiary
    
(1,993
)
  
-
   
1,993
   
-
 
Other
    
(1,650
)
  
-
   
-
   
(1,650
)
Net cash used for investing activities
    
(105,204
)
  
-
   
14,802
   
(90,402
)
                           
NET DECREASE IN CASH AND
                          
CASH EQUIVALENTS
  
$
(2
)
$
-
  
$
-
  
$
(2
)
                           
The notes to the consolidated financial statements of Pennsylvania Power Company, which are incorporated by reference from the annual report
on Form 10-K for the year ended December 31, 2004, are an integral part of the consolidating financial statements.
    
                           
 
 
               
Exhibit F-2
  
THE TOLEDO EDISON COMPANY
CONSOLIDATING INCOME STATEMENT
For the Year Ended December 31, 2004
(In thousands $)
                   
   
 
 
Toledo Edison
 
 
 
Toledo Edison
 
 
 
Toledo Edison
 
Capital
 
 
 
Company
 
 
 
Company
 
Corporation
 
Eliminations
 
Consolidated
 
                   
OPERATING REVENUES
  
$
1,008,112
  
$
-
  
$
-
  
$
1,008,112
  
                           
OPERATING EXPENSES AND TAXES:
                          
Fuel and purchased power
    
363,759
   
-
   
-
   
363,759
 
Nuclear operating costs
    
168,401
   
-
   
-
   
168,401
 
Other operating expenses
    
152,879
   
-
   
-
   
152,879
 
Provision for depreciation
    
57,948
   
-
   
-
   
57,948
 
Amortization of regulatory assets
    
123,858
   
-
   
-
   
123,858
 
Deferral of new regulatory assets
    
(38,696
)
  
-
   
-
   
(38,696
)
General taxes
    
54,142
   
-
   
-
   
54,142
 
Income taxes
    
32,713
   
36
   
(3
)
  
32,746
 
Total expenses
    
915,004
   
36
   
(3
)
  
915,037
 
                           
OPERATING INCOME (LOSS)
    
93,108
   
(36
)
  
3
   
93,075
 
                           
Other Income
    
48,920
   
1
   
-
   
48,921
 
Equity Earnings
    
87
   
140
   
(227
)
  
-
 
Other Income Deductions
    
(6,272
)
  
(8
)
  
127
   
(6,153
)
Other Income Depreciation
    
(213
)
  
-
     -    
(213
)
Taxes--Other Income Deductions
    
(19,604
)
  
-
   
-
   
(19,604
)
OTHER INCOME
    
22,918
   
133
   
(100
)
  
22,951
 
                           
NET INTEREST CHARGES:
                          
Interest on long-term debt
    
27,153
   
-
   
-
   
27,153
 
Allowance for Borrowed Funds Used During
                          
Construction & Capitalized Interest
    
(3,696
)
  
-
   
-
   
(3,696
)
Other interest expense
    
6,286
   
-
   
-
   
6,286
 
Net interest charges
    
29,743
   
-
   
-
   
29,743
 
                           
NET INCOME
    
86,283
   
97
   
(97
)
  
86,283
 
                           
PREFERRED STOCK
                          
DIVIDEND REQUIREMENTS
    
8,844
   
-
   
-
   
8,844
 
                           
EARNINGS ON COMMON STOCK
  
$
77,439
  
$
97
  
$
(97
)
$
77,439
  
                           
The notes to the consolidated financial statements of Toledo Edison Company, which are incorporated by reference from the annual report on Form 10-K for the year ended December 31, 2004, are an integral part of the consolidating financial statements.
                         
 

 
               
Exhibit F-2
  
THE TOLEDO EDISON COMPANY
CONSOLIDATING BALANCE SHEETS
As of December 31, 2004
(In thousands $)
                   
       
Toledo Edison
      
Toledo Edison
  
   
Toledo Edison
  
Capital
     
Company
  
ASSETS
  
Company
  
Corporation
  
Eliminations
  
Consolidated
  
                   
UTILITY PLANT:
                  
In service
  
$
1,856,478
  
$
-
  
$
-
  
$
1,856,478
  
Less--Accumulated provision for depreciation
    
778,864
   
-
   
-
   
778,864
 
     
1,077,614
   
-
   
-
   
1,077,614
 
Construction work in progress
    
74,533
               
74,533
 
     
1,152,147
   
-
   
-
   
1,152,147
 
                           
OTHER PROPERTY AND INVESTMENTS:
                          
Investment in lessor notes
    
212,456
   
2,063
   
(23,827
)
  
190,692
 
Nuclear plant decommissioning trusts
    
297,803
     -      -    
297,803
 
Long-term notes receivable from associated companies
    
39,975
     -      -    
39,975
 
Other
    
2,031
     -      -    
2,031
 
     
552,265
   
2,063
   
(23,827
)
  
530,501
 
                           
CURRENT ASSETS:
                          
Cash and cash equivalents
    
15
   
-
   
-
   
15
 
Receivables-
                          
Customers
    
4,858
   
-
   
-
   
4,858
 
Associated companies
   
36,570
   
-
   
-
   
36,570
 
Other
    
3,842
   
-
   
-
   
3,842
 
Notes receivable from associated companies
    
133,871
   
25,276
   
(23,464
)
  
135,683
 
Material and supplies
    
40,280
   
-
   
-
   
40,280
 
Prepayments and other
    
1,150
   
-
   
-
   
1,150
 
     
220,586
   
25,276
   
(23,464
)
  
222,398
 
                           
DEFERRED CHARGES:
                          
Regulatory assets
    
374,814
   
-
   
-
   
374,814
 
Goodwill
    
504,522
   
-
   
-
   
504,522
 
Property taxes
    
24,100
   
-
   
-
   
24,100
 
Other
    
28,032
   
-
   
(2,608
)
  
25,424
 
     
931,468
   
-
   
(2,608
)
  
928,860
 
                           
TOTAL ASSETS
  
$
2,856,466
  
$
27,339
  
$
(49,899
)
$
2,833,906
  
                           
The notes to the consolidated financial statements of Toledo Edison Company, which are incorporated by reference from the annual report on Form 10-K for the year ended December 31, 2004, are an integral part of the consolidating financial statements.
                         
 
 
               
Exhibit F-2
  
THE TOLEDO EDISON COMPANY
 
CONSOLIDATING BALANCE SHEETS
  
As of December 31, 2004
  
(In thousands $)
  
                   
                   
   
 
 
Toledo Edison
 
 
 
Toledo Edison
 
 
 
Toledo Edison
 
Capital
 
 
 
Company
 
CAPITALIZATION AND LIABILITIES
 
Company
 
Corporation
 
Eliminations
 
Consolidated
  
                   
CAPITALIZATION:
                  
Common stockholder's equity
  
$
835,327
  
$
26,474
  
$
(26,474
)
$
835,327
  
Preferred stock not subject to mandatory redemption
    
126,000
   
-
   
-
   
126,000
 
Long-term debt
    
300,299
   
-
   
-
   
300,299
 
     
1,261,626
   
26,474
   
(26,474
)
  
1,261,626
 
                           
CURRENT LIABILITIES:
                          
Currently payable long-term debt
    
90,950
   
-
   
-
   
90,950
 
Accounts payable-
                          
Associated companies
    
109,740
   
307
   
-
   
110,047
 
Other
    
2,247
   
-
   
-
   
2,247
 
Notes payable to associated companies
    
452,981
   
-
   
(23,464
)
  
429,517
 
Accrued taxes
    
46,938
   
19
   
-
   
46,957
 
Lease market valuation liability
    
24,600
   
-
   
-
   
24,600
 
Other
    
52,884
   
-
   
171
   
53,055
 
     
780,340
   
326
   
(23,293
)
  
757,373
 
                           
NONCURRENT LIABILITIES:
                          
Accumulated deferred income taxes
    
221,950
   
-
   
-
   
221,950
 
Accumulated deferred investment tax credits
    
25,102
   
-
   
-
   
25,102
 
Retirement benefits
    
39,227
   
-
   
-
   
39,227
 
Asset retirement obligation
    
194,315
   
-
   
-
   
194,315
 
Lease market valuation liability
    
268,000
   
-
   
-
   
268,000
 
Other
    
65,906
   
539
   
(132
)
  
66,313
 
     
814,500
   
539
   
(132
)
  
814,907
 
                           
TOTAL LIABILITIES AND CAPITALIZATION
  
$
2,856,466
  
$
27,339
  
$
(49,899
)
$
2,833,906
  
                           
The notes to the consolidated financial statements of Toledo Edison Company, which are incorporated by reference from the annual report on Form 10-K for the year ended December 31, 2004, are an integral part of the consolidating financial statements.
                         
 
 

               
Exhibit F-2
  
THE TOLEDO EDISON COMPANY
CONSOLIDATING STATEMENT OF RETAINED EARNINGS
For the Year Ended December 31, 2004
(In thousands $)
                   
       
Toledo Edison
      
Toledo Edison
  
   
Toledo Edison
  
Capital
      
Company
  
   
Company
  
Corporation
  
Eliminations
  
Consolidated
  
RETAINED EARNINGS:
                  
                   
Balance - Beginning of Period
  
$
113,620
  
$
294
  
$
(294
)
$
113,620
  
                           
Net Income
    
86,283
   
97
   
(97
)
  
86,283
 
                           
Subtotal
    
199,903
   
391
   
(391
)
  
199,903
 
                           
Preferred Stock Dividends Declared
    
(8,844
)
  
-
   
-
   
(8,844
)
                           
Balance - End of Period
  
$
191,059
  
$
391
  
$
(391
)
$
191,059
  
                           
                           
ACCUMULATED OTHER COMPREHENSIVE INCOME:
                          
                           
Balance - Beginning of Period
  
$
11,672
  
$
-
  
$
-
  
$
11,672
  
                           
Unrealized Gain on Investments
    
7,253
    -     -    
7,253
 
                           
Minimum Liability for
                          
Unfunded Retirement Benefits
    
1,114
   
-
   
-
   
1,114
 
                           
Balance - End of Period
  
$
20,039
  
$
-
  
$
-
  
$
20,039
  
                           
                           
The notes to the consolidated financial statements of Toledo Edison Company, which are incorporated by reference from the annual report on Form 10-K for the year ended December 31, 2004, are an integral part of the consolidating financial statements.
                         
 

 
               
Exhibit F-2
  
THE TOLEDO EDISON COMPANY
CONSOLIDATING STATEMENTS OF CASH FLOWS
For the Year Ended December 31, 2004
(In thousands $)
 
          
 
      
 
      
Toledo Edison
     
Toledo Edison
  
   
Toledo Edison
  
Capital
      
Company
  
   
Company
  
Corporation
  
Eliminations
  
Consolidated
  
CASH FLOWS FROM OPERATING ACTIVITIES:
                  
Net Income
  
$
86,283
  
$
97
  
$
(97
)
$
86,283
  
Adjustments to reconcile net income
                         
 to net cash from operating activities--
                          
Provision for depreciation
    
57,948
   
-
   
-
   
57,948
 
Amortization of regulatory Asset
    
123,858
   
-
   
-
   
123,858
 
Deferral of new regulatory asset
    
(38,696
)
  
-
   
-
   
(38,696
)
Nuclear fuel and lease amortization
    
25,034
   
-
   
-
   
25,034
 
Deferred rents and lease market valuation liability
    
(23,121
)
  
-
   
-
   
(23,121
)
Undistributed subsidiary earnings
    
0
   
32
   
(32
)
  
0
 
Deferred income taxes and investment tax credits, net
    
6,123
   
-
   
-
   
6,123
 
Accrued retirement benefit obligation
    
5,889
   
-
   
-
   
5,889
 
Accrued compensation, net
    
1,074
   
-
   
-
   
1,074
 
Pension trust contribution
    
(12,572
)
  
-
   
-
   
(12,572
)
Decrease (increase) in operating assets:
                          
Receivables
    
10,228
   
-
   
-
   
10,228
 
Materials and supplies
    
(5,133
)
  
-
   
-
   
(5,133
)
Prepayments & other current assets
    
5,554
   
-
   
-
   
5,554
 
Increase (decrease) in operating liabilities:
                          
Accounts payable
    
(23,679
)
  
281
   
-
   
(23,398
)
Accrued taxes
    
(8,411
)
  
(236
)
  
-
   
(8,647
)
Accrued interest
    
(9,080
)
  
-
   
-
   
(9,080
)
Other
    
(18,401
)
  
-
   
(37
)
  
(18,438
)
Net cash provided from operating activities
    
182,898
   
174
   
(166
)
  
182,906
 
                           
CASH FLOWS FROM FINANCING ACTIVITIES:
                          
New Financing--
                          
Long-term debt
    
103,500
   
-
   
-
   
103,500
 
Short-term borrowings, net
    
73,565
   
-
   
-
   
73,565
 
Redemptions and Repayments--
                          
Long-term debt
    
(262,162
)
  
-
   
-
   
(262,162
)
Dividend Payments--
                          
Preferred stock
    
(8,844
)
  
-
   
-
   
(8,844
)
Net cash used for financing activities
    
(93,941
)
  
-
   
-
   
(93,941
)
                           
CASH FLOWS FROM INVESTING ACTIVITIES:
                          
Property additions
    
(64,629
)
    -    
-
   
(64,629
)
Loan payments from (to) associated companies, net
    
7,292
   
(8
)
  
-
   
7,284
 
Investment in lessor notes
    
10,246
     -    
-
   
10,246
 
Contributions to nuclear decommissioning trusts
    
(28,541
)
   -     -    
(28,541
)
Other
    
(15,547
)
  
(166
)
  
166
   
(15,547
)
Net cash used for investing activities
    
(91,179
)
  
(174
)
  
166
   
(91,187
)
                           
                           
NET DECREASE IN CASH AND CASH EQUIVALENTS
  
$
(2,222
)
$
-
  
$
-
  
$
(2,222
)
                           
The notes to the consolidated financial statements of Toledo Edison Company, which are incorporated by reference from the annual report on Form 10-K for the year ended December 31, 2004, are an integral part of the consolidating financial statements.