OG&E 2009 Annual Report Download - page 40

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Ÿ The Windspeed transmission line is in service with the rider effective April 1, 2010;
Ÿ Operating expenses of approximately $655 million to $665 million, with operation and maintenance expenses
comprising approximately 60 percent of total;
Ÿ Interest expense of approximately $105 million to $115 million, which assumes approximately $250 million of
additional long-term debt issued by the Company in mid-2010;
Ÿ AEFUDC income of approximately $5 million; and
Ÿ An effective tax rate of approximately 27 percent.
The Company has significant seasonality in its earnings. The Company typically shows minimal earnings in the first and
fourth quarters with a majority of earnings in the third quarter due to the seasonal nature of air conditioning demand.
Results of Operations
The following discussion and analysis presents factors that affected the Company’s results of operations for the years ended
December 31, 2009, 2008 and 2007 and the Company’s financial position at December 31, 2009 and 2008. The following information
should be read in conjunction with the Financial Statements and Notes thereto. Known trends and contingencies of a material nature
are discussed to the extent considered relevant.
Year ended December 31 (In millions) 2009 2008 2007
Operating income $ 354.1 $ 278.3 $ 292.0
Net income $ 200.4 $ 143.0 $ 161.7
In reviewing its operating results, the Company believes that it is appropriate to focus on operating income as reported in its
Statements of Income as operating income indicates the ongoing profitability of the Company excluding the cost of capital and income
taxes.
34