Dominion Power 2003 Annual Report Download - page 41

39.Dominion 2003
Specific Items Attributable to Operating Segments
— 2003
During 2003, Dominion reported in the Corporate and Other seg-
ment the following items attributable to its operating segments:
• $21 million net after-tax gain representing the cumulative effect
of adopting new accounting principles, as described in Note 3 to
the Consolidated Financial Statements, including:
• SFAS No. 143: a $180 million after-tax gain attributable to:
Dominion Generation ($188 million after-tax gain); Dominion
Exploration & Production ($7 million after-tax loss); and
Dominion Delivery ($1 million after-tax loss);
• EITF 02-3: a $67 million after-tax loss attributable to
Dominion Energy;
• SFAS No. 133 Interpretation C20: a $75 million after-tax
loss attributable to Dominion Generation and
• FIN 46R: a $17 million after-tax loss attributable to
Dominion Generation;
• $197 million of operations and maintenance expense
($122 million after-tax), representing incremental restoration
expenses associated with Hurricane Isabel, attributable primarily
to Dominion Delivery;
• A $105 million ($65 million after-tax) charge for the termina-
tion of power purchase contracts attributable to Dominion
Generation;
• A $64 million ($39 million after-tax) charge for the restructur-
ing and termination of certain electric sales contracts attributable
to Dominion Generation and
• $28 million ($16 million after-tax) of severance costs for work-
force reductions during the first quarter of 2003, attributable to:
• Dominion Generation ($8 million after-tax)
• Dominion Energy ($2 million after-tax),
• Dominion Delivery ($4 million after-tax),
• Dominion Exploration & Production ($1 million after-
tax) and
• Corporate and other ($1 million after-tax);
Specific Items Attributable to Operating Segments
— 2001
During 2001, Dominion reported in the Corporate and Other seg-
ment the following items attributable to its operating segments:
• A $68 million after-tax charge for restructuring activities,
including employee severance and termination benefits and costs
associated with the termination of leases, attributable to:
• Dominion Generation ($8 million after-tax);
• Dominion Energy ($9 million after-tax);
• Dominion Delivery ($44 million after-tax) and
• Dominion Exploration & Production ($3 million
after-tax);
• A $97 million after-tax charge for credit exposure associated
with the bankruptcy of Enron attributable to:
• Dominion Exploration & Production ($99 million
after-tax);
• Dominion Energy ($2 million after-tax credit);
• A $136 million after-tax charge related to the termination of
certain long-term power purchase contracts attributable to
Dominion Generation.
DCI Operations
DCI recognized a net loss in 2003, resulting primarily from the
recognition of the following:
• $51 million ($33 million after-tax) impairment of retained inter-
ests from securitizations;
• $34 million ($22 million after-tax) impairment of goodwill and
other investments;
• $23 million ($15 million after-tax) recognized in connection
with the sale of financial assets during the fourth quarter of
2003 and
• $26 million valuation allowance on certain deferred
tax assets.
DCI earned $14 million in 2002, compared to a net loss of
$225 million in 2001. The net loss in 2001, resulted primarily
from the recognition of the following:
• $102 million ($66 million after-tax) impairment of retained
interests from securitizations;
• $94 million ($61 million after-tax) impairment of loans receiv-
able and
• $85 million ($55 million after-tax) impairment of other
investments.
Telecommunications Operations
Dominion’s loss from its telecommunications business increased
$724 million to $750 million in 2003, primarily reflecting:
• $566 million associated with the impairment of network
assets and related inventories. Dominion has not recognized any
deferred tax benefits related to the impairment charges, since
realization of tax benefits will be dependent upon Dominion’s
future tax profile;
• A $48 million increase in deferred tax expense as a result of
the increase in the valuation allowance on deferred tax assets;
• Dominion’s purchase of the remaining equity interest in
DFV held by another party for $62 million in December 2003,
$60 million of which was recorded as goodwill and impaired;
• $57 million ($35 million after-tax) for the costs associated with
Dominion’s acquisition of DFV senior notes and
• $41 million of after-tax operating losses.