 For The Years Ended December 31, 1997, 1996 and 1995 |
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| Note 1. Nature of Operations |
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On June 18, 1997, Duke Power Company (Duke Power) changed its name to Duke Energy Corporation (the Corporation) in accordance with the terms of a merger agreement with PanEnergy Corp (PanEnergy), pursuant to which the Corporation issued 158.3 million shares of its common stock in exchange for all of the outstanding common stock of PanEnergy (the merger). PanEnergy was involved in the gathering, processing, transportation and storage of natural gas, the production of natural gas liquids, and the marketing of natural gas, electricity, liquefied petroleum gases and related energy services. Pursuant to the merger, each share of PanEnergy common stock outstanding was converted into the right to receive 1.0444 shares of the Corporation’s common stock. In addition, each outstanding option to purchase PanEnergy common stock became an option to purchase common stock of the Corporation, adjusted accordingly. The merger was accounted for as a pooling of interests and, accordingly, the consolidated financial statements for periods prior to the combination were restated to include the operations of PanEnergy. Operating revenues and net income previously reported by the separate companies and the combined amounts presented in the accompanying consolidated financial statements for the years ended December 31, 1996 and 1995 are as follows: |
| In Millions | Duke Power | PanEnergy | Adjustments | Combined |
| 1996 | ||||||||||||||
| Operating revenues | $ | 4,758.0 | $ | 7,505.6 | $ | 38.8 | $ | 12,302.4 | ||||||
| Net income before extraordinary item | $ | 729.9 | $ | 361.1 | $ | -- | $ | 1,091.0 | ||||||
| Net income | $ | 729.9 | $ | 344.4 | $ | -- | $ | 1,074.3 | ||||||
| 1995 | ||||||||||||||
| Operating revenues | $ | 4,676.6 | $ | 4,967.5 | $ | 50.6 | $ | 9,694.7 | ||||||
| Net income | $ | 714.5 | $ | 303.6 | $ | -- | $ | 1,018.1 |
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The adjustment to operating revenues reflects a reclassification of PanEnergy’s equity in earnings of unconsolidated affiliates from other income to revenues to be consistent with the Corporation’s financial statement presentation. The Corporation is an integrated energy and energy services provider with the ability to offer physical delivery and management of both electricity and natural gas throughout the United States and abroad. The Corporation provides these services through its four business segments: Electric Operations – Generation, transmission, distribution and sale of electric energy in central and western North Carolina and the western portion of South Carolina. Duke Energy Corporation (doing business as Duke Power) and its wholly owned subsidiary Nantahala Power and Light Company serve this area. These electric operations are subject to the rules and regulations of the Federal Energy Regulatory Commission (FERC), the North Carolina Utilities Commission (NCUC) and The Public Service Commission of South Carolina (PSCSC). Natural Gas Transmission – Interstate transportation and storage of natural gas for customers in the Mid-Atlantic, New England and Midwest states. The interstate natural gas transmission and storage operations of the Corporation’s wholly owned subsidiaries Texas Eastern Transmission Corporation (TETCO), Algonquin Gas Transmission Company (Algonquin), Panhandle Eastern Pipe Line Company (PEPL), and Trunkline Gas Company (Trunkline) are also subject to the rules and regulations of the FERC. Energy Services – Comprised of several separate business units: Field Services – gathers and processes natural gas, produces and markets natural gas liquids and transport and trades crude oil; Trading and Marketing – markets natural gas, electricity and other energy-related products; Global Asset Development – develops, owns and operates energy-related facilities worldwide; and Other Energy Services – provides engineering consulting, construction and integrated energy solutions. Other Operations – Real estate operations of Crescent Resources, Inc., communications services, corporate costs and intersegment eliminations. |
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