35-CERT 1 ccpcsec.txt 35-CERT CONESVILLE COAL PREPARATION COMPANY QUARTERLY REPORT PER REQUIREMENTS OF HOLDING COMPANY ACT RELEASE NO. 23463 BY MONTH, FOR THE QUARTER ENDED DECEMBER 31, 2000 CONTENTS Page Statements of Income 1 Balance Sheets 2 Information Concerning Coal Washing Facility 3 Statements of Quantities of Coal Processed and Customer Billings for Coal Washing Services 4 Statements of Cost of Operation 5 Price Per Ton of Coal Deliveries 6 CONESVILLE COAL PREPARATION COMPANY STATEMENTS OF INCOME BY MONTH, FOR THE QUARTER ENDED DECEMBER 31, 2000 (UNAUDITED)
Three Months Month Ended Ended October 31, November 30, December 31, December 31, 2000 2000 2000 2000 (in thousands) OPERATING REVENUES - Services to Parent . . . . . . . . $887 $918 $2,016 $3,821 COST OF OPERATION. . . . . . . . . . 876 905 916 2,697 OPERATING INCOME . . . . . . . . . . 11 13 1,100 1,124 NONOPERATING INCOME. . . . . . . . . 4 5 6 15 INCOME BEFORE INTEREST CHARGES . . . 15 18 1,106 1,139 INTEREST CHARGES . . . . . . . . . . - - 220 220 INCOME BEFORE FEDERAL INCOME TAXES . 15 18 886 919 FEDERAL INCOME TAXES ON OPERATIONS . 9 12 880 901 NET INCOME . . . . . . . . . . . . . $ 6 $ 6 $ 6 $ 18 The common stock of the Company is wholly owned by Columbus Southern Power Company.
CONESVILLE COAL PREPARATION COMPANY BALANCE SHEETS BY MONTH-END, FOR THE QUARTER ENDED DECEMBER 31, 2000 (UNAUDITED)
October 31, November 30, December 31, 2000 2000 2000 (in thousands) ASSETS MINING PLANT: Mining Plant in Service . . . . . . . . . . . . $2,155 $2,284 $2,284 Accumulated Amortization. . . . . . . . . . . . 1,163 1,210 1,268 NET MINING PLANT . . . . . . . . . . . . 992 1,074 1,016 OTHER PROPERTY AND INVESTMENTS. . . . . . . . . . 875 869 116 CURRENT ASSETS: Cash and Cash Equivalents . . . . . . . . . . . 4 6 7 Accounts Receivable: General . . . . . . . . . . . . . . . . . . . 3 4 11 Affiliated Companies. . . . . . . . . . . . . 894 923 2,022 Advances to Affiliates. . . . . . . . . . . . . 716 1,052 1,328 Materials and Supplies. . . . . . . . . . . . . 956 958 976 Other . . . . . . . . . . . . . . . . . . . . . - 2 6 TOTAL CURRENT ASSETS . . . . . . . . . . 2,573 2,945 4,350 DEFERRED FEDERAL INCOME TAXES . . . . . . . . . . 812 821 961 REGULATORY ASSETS . . . . . . . . . . . . . . . . 468 328 324 DEFERRED CHARGES. . . . . . . . . . . . . . . . . - - 24 TOTAL. . . . . . . . . . . . . . . . . $5,720 $6,037 $6,791 CAPITALIZATION AND LIABILITIES SHAREHOLDER'S EQUITY: Common Stock - Par Value $1,000: Authorized - 500 Shares Outstanding - 100 Shares. . . . . . . . . . . $ 100 $ 100 $ 100 Paid-in Capital . . . . . . . . . . . . . . . . 400 400 400 Retained Earnings . . . . . . . . . . . . . . . 1,018 1,024 1,030 TOTAL SHAREHOLDER'S EQUITY . . . . . . . 1,518 1,524 1,530 OTHER NONCURRENT LIABILITIES. . . . . . . . . . . 2,212 2,211 2,209 CURRENT LIABILITIES: Accounts Payable: General . . . . . . . . . . . . . . . . . . . 135 124 368 Affiliated Companies. . . . . . . . . . . . . 287 331 415 Accrued Rent. . . . . . . . . . . . . . . . . . 289 578 884 Other . . . . . . . . . . . . . . . . . . . . . 703 813 1,145 TOTAL CURRENT LIABILITIES. . . . . . . . 1,414 1,846 2,812 DEFERRED GAIN ON SALE OF PLANT. . . . . . . . . . 276 256 237 REGULATORY LIABILITIES AND DEFERRED CREDITS . . . 300 200 3 TOTAL. . . . . . . . . . . . . . . . . $5,720 $6,037 $6,791
CONESVILLE COAL PREPARATION COMPANY INFORMATION CONCERNING COAL WASHING FACILITY FOR THE QUARTER ENDED DECEMBER 31, 2000 TAXES On February 20, 2001, the U.S. District Court for the Southern District of Ohio ruled against the Company in its suit against the United States over deductibility of interest claimed by the Company in its consolidated federal income tax return related to its COLI program. The Company had filed suit to resolve the IRS's assertion that interest deductions for the Company's COLI program should not be allowed. In 1998 and 1999 the Company paid the disputed taxes and interest attributable to COLI interest deductions for taxable years 1991-98 to avoid the potential assessment by the IRS of additional interest on the contested tax. The payments were included in other property and investments pending the resolution of this matter. As a result of the U.S. District Court's decision to deny the COLI interest deductions, the Company recovered from Columbus Southern Power Company (CSPCo) all of its costs under terms of the coal washing agreement. The Company plans to appeal the decision. MONEY POOL On June 15, 2000, the Company became a participant in the American Electric Power (AEP) System Money Pool (Money Pool). The Money Pool is a mechanism structured to meet the short-term cash requirements of the participants with AEP Company, Inc. acting as the primary borrower on behalf of the Money Pool. The Company's affiliates that are U.S. domestic electric utility operating companies and coal-mining companies are the primary participants in the Money Pool. The operation of the Money Pool is designed to match on a daily basis the available cash and borrowing requirements of the participants. Participants with excess cash loan funds to the Money Pool reducing the amount of external funds AEP Company, Inc. needs to borrow to meet the short-term cash requirements of other participants with advances from the Money Pool. AEP Company, Inc. borrows the funds needed on a daily basis to meet the net cash requirements of the Money Pool participants. A weighted average daily interest rate which is calculated based on the outstanding short-term debt borrowings made by AEP Company, Inc. is applied to each Money Pool participant's daily outstanding investment or debt position to determine interest income or interest expense. Interest income is included in nonoperating income, and interest expense is included in interest charges. As a result of becoming a Money Pool participant, the Company retired its short-term debt. At December 31, 2000 the Company was a net investor in the Money Pool and reports its investment in the Money Pool as Advances to Affiliates on the Balance Sheet. CONESVILLE COAL PREPARATION COMPANY STATEMENTS OF QUANTITIES OF COAL PROCESSED AND BILLINGS FOR COAL WASHING SERVICES BY MONTH, FOR THE QUARTER ENDED DECEMBER 31, 2000
Services Rendered to Columbus Southern Raw Clean Power Company's Coal Coal Service Conesville Plant* Input Rejects Output Unit Price Billings (Month/Year) (tons) (tons) (tons) (per ton) (000) October 2000 . . . . . . . . 284,821 38,742 246,079 $3.60 $ 887 November 2000. . . . . . . . 258,384 35,861 222,523 $4.13 $ 918 December 2000. . . . . . . . 227,878 29,720 198,158 $10.17 $2,016 * Jointly owned by Cincinnati Gas & Electric Company, Dayton Power & Light Company and Columbus Southern Power Company, the parent of Conesville Coal Preparation Company.
CONESVILLE COAL PREPARATION COMPANY STATEMENTS OF COST OF OPERATION BY MONTH, FOR THE QUARTER ENDED DECEMBER 31, 2000
Three Months October November December Ended 2000 2000 2000 12/31/99 (in thousands) Labor-UMW*. . . . . . . . . . . . . . . . . . . $ 93 $ 82 $ 100 $ 275 Benefits-UMW* . . . . . . . . . . . . . . . . . 74 72 55 201 Office Salaries and Benefits. . . . . . . . . . 98 97 80 275 Operating Materials . . . . . . . . . . . . . . 48 39 46 133 Maintenance - Materials and Services. . . . . . 39 62 72 173 Electricity . . . . . . . . . . . . . . . . . . 59 99 36 194 Other Billed Services . . . . . . . . . . . . . 19 80 163 262 Rent. . . . . . . . . . . . . . . . . . . . . . 327 328 325 980 Amortization of Deferred Gain on Sale of Plant. (20) (20) (19) (59) Depreciation. . . . . . . . . . . . . . . . . . 36 36 41 113 Cleaning Cost Normalization** . . . . . . . . . (16) (100) (191) (307) Other . . . . . . . . . . . . . . . . . . . . . 119 130 208 457 Total . . . . . . . . . . . . . . . . . . $876 $905 $916 $2,697 * United Mine Workers of America. ** Represents the deferral/accrual required to establish revenue based on forecasted results for the remainder of the year. The amount of cleaning cost normalization is established on an "overall" company basis (i.e., not itemized) and is eliminated by year-end.
COLUMBUS SOUTHERN POWER COMPANY PRICE PER TON OF COAL DELIVERIES BY MONTH, FOR THE QUARTER ENDED DECEMBER 31, 2000
October November December 2000 2000 2000 Clean Coal Deliveries from Conesville Coal Preparation Plant (a) . . . . . . . . . . . . . . . . $32.02 * $31.45 * $30.86 * Notes: (a) Coal cleaned by Conesville Coal Preparation Plant and delivered to Columbus Southern Power's Conesville Generating Plant. These deliveries of clean coal will normally consist of coal cleaned from beginning inventory as well as current month deliveries. * Average price per ton.