Eversource 1999 Annual Report Download - page 53

Preferred stock and long-term debt: The fair value of the NU
system’s fixed-rate securities is based upon the quoted market
price for those issues or similar issues. Adjustable rate securities
are assumed to have a fair value equal to their carrying value.
The carrying amounts of the NU system’s financial instruments
and the estimated fair values are as follows:
At December 31, 1999
Carrying Fair
(Millions of Dollars) Amount Value
Preferred stock not subject
to mandatory redemption $ 136.2 $ 164.0
Preferred stock subject to
mandatory redemption 167.5 166.8
Long-term debt —
First mortgage bonds 1,193.2 1,209.5
Other long-term debt 1,638.3 1,430.1
MIPS 100.0 97.3
At December 31, 1998
Carrying Fair
(Millions of Dollars) Amount Value
Preferred stock not subject
to mandatory redemption $ 136.2 $ 97.0
Preferred stock subject to
mandatory redemption 213.8 205.9
Long-term debt —
First mortgage bonds 1,984.0 2,003.6
Other long-term debt 1,654.9 1,682.7
MIPS 100.0 102.0
11. OTHER COMPREHENSIVE INCOME
The accumulated balance for each other comprehensive
income item is as follows:
Current
December 31, Period December 31,
(Thousands of Dollars) 1998 Change 1999
Foreign currency
translation adjustments $ (1) $ 1 $—
Unrealized gains
on securities 2,019 118 2,137
Minimum pension
liability adjustments (613) — (613)
Accumulated other
comprehensive income $1,405 $119 $ 1,524
Current
December 31, Period December 31,
(Thousands of Dollars) 1997 Change 1998
Foreign currency
translation adjustments $ (1) $ — $ (1)
Unrealized gains
on securities — 2,019 2,019
Minimum pension
liability adjustments — (613) (613)
Accumulated other
comprehensive income $(1) $1,406 $ 1,405
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The changes in the components of other comprehensive
income are reported net of the following income tax effects:
(Thousands of Dollars) 1999 1998 1997
Foreign currency
translation
adjustments $— $ — $359
Unrealized gains
on securities (71) (1,222) —
Minimum pension
liability adjustments —398 —
Other comprehensive
income $(71) $ (824) $359
12. EARNINGS PER SHARE
Earnings per share (EPS) is computed based upon the weighted
average number of common shares outstanding during each
year. Diluted earnings per share is computed on the basis of the
weighted average number of common shares outstanding plus
the potential dilutive effect if certain securities are converted into
common stock.
The following table sets forth the components of basic and
diluted EPS:
(Millions of Dollars,
except share information) 1999 1998 1997
Income/(loss) after
interest charges $57.0 $ (120.4) $ (99.7)
Preferred dividends
of subsidiaries 22.8 26.4 30.3
Net income/(loss) $34.2 $ (146.8) $(130.0)
Basic EPS
common shares
outstanding
(average) 131,415,126 130,549,760 129,567,708
Dilutive effect
of employee
stock options 616,447 —(a) —(a)
Diluted EPS
common shares
outstanding
(average) 132,031,573 130,549,760 129,567,708
Basic earnings/
(loss) per share $ 0.26 $(1.12) $(1.01)
Diluted earnings/
(loss) per share $ 0.26 $(1.12) $(1.01)
(a) The addition of dilutive potential common shares would be anti-dilutive for
1998 and 1997 and was not included.
13. MODE 1
In August 1998, NorthEast Optic Network, Inc. (NEON) issued
4,000,000 new common shares on the open market in an initial
public offering (IPO). The IPO had the effect of decreasing Mode
1’s ownership interest in NEON from 40.78 percent to 30.74
percent. The shares were issued at an amount greater than Mode
1’s investment, resulting in a $13.7 million pretax increase to
Mode 1’s equity. NU’s accounting policy is to recognize the gain