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Alliant Energy Annual Report, Year Ended Dec 31, 1998

Filing Date
Filed March 31, 1999
Period End
December 31, 1998
Security
LNT
In the record · 2016–202610-K1110-Q338-K136

LNT filed 11 annual reports (10-K), 33 quarterly reports (10-Q) and 136 current reports (8-K) between 2016 and 2026.

  1. Material agreement8-K · May ’17May ’17
  2. Leadership change8-K · Dec ’19Dec ’19
  3. Material agreement8-K · Mar ’22Mar ’22
  4. Leadership change8-K · Jan ’26Jan ’26

01—Abstract

Summary

Summary of the 10-K filed March 31, 1999. Cited figures are marked; the original filing is the authoritative source.

Interstate Energy Corporation (IEC), which is currently doing business as Alliant Energy Corporation, reported 1998 net income of $96.7 milliona, or $1.26 per share, down from $144.6 million, or $1.90 per share, in 1997.

The results include $54 millionb of pre-tax merger-related charges tied to the April 21, 1998 merger of IES Industries, WPL Holdings and Interstate Power Company. Excluding those charges, the filing cites net income of $131.3 million, or $1.71 per share. Operating revenues were $2.13 billion in 1998 versus $2.30 billion in 1997, and the company's electric utility revenues rose to $1.57 billion.

Nonregulated operations posted a net loss of about $8.9 millionc in 1998. The company's principal businesses are regulated electric and gas utilities in Iowa, Wisconsin, Minnesota and Illinois, operated through IES Utilities Inc., Wisconsin Power and Light Company and Interstate Power Company, plus nonregulated operations under Alliant Energy Resources. Earnings were pressured by higher purchased-power and transmission costs at WP&L, milder weather that cut retail gas sales by 15.7 percent, and lower oil and gas prices at Whiting Petroleum.

Retail electricity sales volumes rose about 2 percent on economic growth. The McLeodUSA Inc. stock holding was valued at $320.3 milliond at year-end 1998, against a cost basis of $29.1 million.

The filing also describes a four-year rate freeze on electric and gas prices tied to the merger, a federal court decision on March 16, 1999 upholding the SEC's approval of the merger, and ongoing state-level electric restructuring efforts in Iowa and Wisconsin. Capital expenditures for 1999 are estimated at about $495 million, and the company is pursuing an independent transmission company with Northern States Power Co.

02—Key points

Key Highlights

  1. 1998 net income of $96.7 million ($1.26 per share), versus $144.6 million ($1.90 per share) in 1997, after $54 million of pre-tax merger-related charges
  2. Excluding merger-related charges, 1998 net income was $131.3 million ($1.71 per share), compared with $146.2 million ($1.92 per share) in 1997
  3. Operating revenues of $2.13 billion in 1998, down from $2.30 billion in 1997, reflecting lower gas utility and nonregulated energy revenues
  4. Electric utility revenues rose to $1.57 billion from $1.52 billion, with electric margin up $33.9 million on higher sales volumes and energy efficiency cost recovery
  5. Total assets of $4.96 billion at year-end 1998, and McLeodUSA stock investment valued at $320.3 million versus a $29.1 million cost basis
  6. Regulatory headwinds include four-year merger-related rate freezes in Iowa and Wisconsin, a proposed Iowa electric choice bill, and a pending independent transmission company with Northern States Power
  7. Planned 1999 construction and acquisition expenditures of about $495 million, with approximately $1.3 billion for utility construction during 2000-2003

03—Questions

Frequently Asked Questions

  1. Why did earnings decline in 1998?

    Reported net income fell to $96.7 million from $144.6 million, largely due to $54 million of pre-tax merger-related charges. The filing also cites higher purchased-power and transmission costs at WP&L, a 15.7 percent decrease in retail natural gas sales from milder weather, a $9 million regulatory asset write-off at IESU, and lower oil and gas prices at Whiting Petroleum.

  2. What is the status of the merger and its approval?

    IES Industries, WPL Holdings and Interstate Power Company completed their three-way merger on April 21, 1998, forming IEC. On March 16, 1999, the U.S. Court of Appeals for the District of Columbia upheld the SEC's approval of the merger and denied the petition for review brought by MG&E and Citizens Utility Board.

  3. How significant is the McLeodUSA investment?

    At December 31, 1998, IEC's McLeodUSA stock was valued at $320.3 million, based on a closing price of $31.25 per share, compared with a cost basis of $29.1 million. Changes in its value flow through common equity rather than net income, and an agreement entered into in November 1998 restricts IEC's ability to sell the shares.

  4. What regulatory changes could affect the company's future?

    Iowa legislation proposed for 1999 would allow electric customer choice by May 1, 2002, freeze IESU and IPC Iowa prices at January 1999 levels, and provide transition cost recovery through 2005. The company says it cannot predict whether the bill will be enacted. Wisconsin is not expected to introduce similar legislation in 1999, and Illinois customer choice phases in beginning in 1999.

  5. What are the company's capital spending plans?

    IEC estimates 1999 construction and acquisition expenditures of about $495 million, including about $275 million for utility operations, $100 million for international energy investments and $120 million for new business development at Alliant Energy Resources. For 2000-2003, utility construction spending is expected to total about $1.3 billion.

04—Continue

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