Results of Operations -
Electric Operations
 
Dollars In Millions 1997  1996  1995 
Revenue $ 4,401.7 $ 4,498.4 $ 4,512.4
Operating Expenses 3,221.4 3,194.8 3,203.7
Operating Income 1,180.3 1,303.6 1,308.7
Other Income, Net of Expenses 101.5 115.9 72.5
EBIT $ 1,281.8 $ 1,419.5 $ 1,381.2
Volumes, GWh Salesa 77,541 76,852 76,737
a Gigawatt-hour sales
 
 

In 1997, earnings before interest and taxes for the Electric Operations segment declined 10% as compared to 1996 primarily as a result of the provision for non-recurring severance costs associated with the work force reduction and the increase in nuclear expenses, due primarily to increased outage days. Also contributing to the decrease were lower electric revenues, which were due primarily to mild weather and to the South Carolina rate reduction, which was effective June 1, 1996. Partially offsetting the decrease in earnings were lower expenses in 1997 as compared to 1996 when major storms affected distribution costs.

 

Although the unusually mild weather reduced residential sales during the year, general service and industrial sales continued to show strong growth. Residential kilowatt-hour sales, the most sensitive to weather, declined 4.7% during the year. Textile sales increased 3.0% and other industrial sales were up 1.3%, for a total growth in industrial sales of 2.0%. Sales to general service customers increased 0.5%. The number of customers in the Electric Operations’ service territory increased 2.7% over 1996.
 

In 1996, earnings before interest and taxes for Electric Operations increased 3% over 1995 due to growth in the number of residential and general service customers and increased retail kilowatt-hour sales to weather-sensitive customer classes. Increased retail sales were partially offset by the South Carolina rate reduction, which was effective June 1, 1996 and by a 16% decrease in wholesale sales primarily due to a decrease of 24% in supplemental sales requirements to the other joint owners of the Catawba Nuclear Station (Catawba). The effect on earnings before interest and taxes of the decrease in supplemental sales was partially offset by declines in purchased power expense from the other joint owners.

For more information on the Catawba joint ownership, see Note 6 to the Consolidated Financial Statements.

 
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