Dominion Power 2001 Annual Report Download - page 59

Download and view the complete annual report

Please find page 59 of the 2001 Dominion Power annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 91

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91

57
CNG
On January 28, 2000, Dominion acquired all of the outstanding
shares of CNG and accounted for the acquisition under the pur-
chase method of accounting. The results of CNG have been
included in the consolidated financial statements since that date.
The aggregate purchase price was $6.4 billion, consisting of
approximately 87 million shares of Dominion common stock
valued at $3.5 billion and approximately $2.9 billion in cash.
Dominion recorded $3.5 billion of goodwill representing the
excess of the purchase price over the fair value of CNG’s opera-
tions not subject to cost-based rate regulation and the historical
carrying value of CNG’s operations subject to cost-of-service
rate regulation. Through December 31, 2001, Dominion amor-
tized $165 million of goodwill based on the straight-line method
and 40 years. See Note 4.
The initial purchase price allocation included estimated
values for amounts expected to be realized from the sale of
Virginia Natural Gas (VNG) and CNG International, which
were classified as net assets held for sale. Dominion sold VNG
and CNG International’s Argentine investments in 2000. See
Note 6. At December 31, 2001 the unsold portion of CNG
International included primarily its equity investment in
Australian energy activities.
Unaudited Pro Forma Results
The following unaudited pro forma combined results of opera-
tions for the years ended December 31, 2001 and 2000 have
been prepared assuming the acquisition of Millstone and Louis
Dreyfus had occurred at the beginning of each period. The pro
forma adjustment for Millstone in 2001 reflects the effect of
scheduled outages during the first quarter of 2001. The pro
forma results are provided for information only. The results are
not necessarily indicative of the actual results that would have
been realized had the acquisition occurred on the indicated date,
nor are they necessarily indicative of future results of operations
of the combined businesses.
Unaudited
Pro Forma
As Millstone Louis Dreyfus Combined
(Millions, except per share amounts) Year ended December 31, Reported Acquisition Acquisition Results
2001
Operating revenue $10,558 $ 85 $554 $11,197
Income before cumulative effect of a change in accounting principle 544 (62) 155 637
Net income 544 (62) 155 637
Earnings Per Share
—
Basic
Income before cumulative effect of a change in accounting principle $ 2.17 $ 2.41
Net income $ 2.17 $ 2.41
Average shares of common stock 250.2 14.3 264.5
Earnings Per Share
—
Diluted
Income before cumulative effect of a change in accounting principle $ 2.15 $ 2.39
Net income $ 2.15 $ 2.39
Average shares of common stock 252.5 14.5 267.0
2000
Operating revenue $ 9,246 $499 $474 $10,219
Income before cumulative effect of a change in accounting principle 415 10 71 496
Net income 436 10 71 517
Earnings Per Share
—
Basic
Income before cumulative effect of a change in accounting principle $ 1.76 $ 1.99
Net income $ 1.85 $ 2.07
Average shares of common stock 235.2 14.3 249.5
Earnings Per Share
—
Diluted
Income before cumulative effect of a change in accounting principle $ 1.76 $ 1.98
Net income $ 1.85 $ 2.07
Average shares of common stock 235.9 14.4 250.3