News Release
July 23, 2002

DUKE ENERGY EARNS 57 CENTS PER SHARE IN SECOND QUARTER

  • Gas Transmission EBIT up 120 percent due to addition of Canadian assets
  • Energy Services increases domestic merchant portfolio to more than 12,000 megawatts
  • Company revises forecast for 2002 EPS results to $2.45 to $2.55
  • Company discusses capital expenditures and 2003 earnings guidance
  • Company's trading investigation concludes no material financial impact


CHARLOTTE, N.C. -- Duke Energy earned 57 cents per share in second quarter 2002, compared with 54 cents per share in second quarter 2001, as greater earnings from the company's gas transmission businesses were offset by lower results at Duke Energy North America (DENA). During the quarter, the company completed construction of a new natural gas pipeline to Florida and significantly increased its merchant energy portfolio to more than 12,000 megawatts.

For the first half of 2002, Duke Energy earned $1.05 a share, compared to $1.27 per share during the first half of 2001, before the 13-cent per share charge in first quarter 2001 for the cumulative effect of a change in accounting principle. Year-to-date earnings before interest and taxes (EBIT) were $1.8 billion, compared to $2.2 billion last year.

"Our second quarter results reflect the high quality operational performance that is our hallmark," said Richard B. Priory, chairman, president and chief executive officer of Duke Energy. "The recent dramatic softening of the energy market is affecting our near-term outlook, and we've accordingly adjusted our business plan to reflect this climate and to align future expectations with the reality of these markets."

Capital Expenditures

"We will reduce our annual capital expenditures consistent with the reduced opportunities present in the changing energy markets. Our current expectation for capex spending this year is approximately $6.8 billion, excluding the acquisition of Westcoast. For 2003 and 2004, we expect our annual capex program to be about $4 billion to $6 billion. These figures include an annual maintenance capex of about $2 billion each year. Our previous guidance included estimates of annual capex spending of $6 billion to $8 billion.

Earnings Guidance

"In light of the reduced capital expenditures for business expansion and the decreased opportunities for the trading and marketing business, we believe earnings per share for 2002 will be in a range of $2.45 to $2.55, which is at the lower end or slightly below our previous guidance. These lower expectations are primarily the result of reduced volatility, subdued commodity pricing and reduced energy demand due to the prolonged economic downturn," Priory continued.

"For 2003, we expect earnings to grow from 5 percent to 10 percent per share above the 2002 base. The 2003 projection also includes expected lower results for Duke Power, as we begin the seven-year amortization of the $1.5 billion in planned expenditures called for in North Carolina's recently passed "clean air" legislation.

"Our view of the future can certainly be impacted by the rapidly changing market. Therefore, we will review the guidance on earnings growth and capital expenditures as part of our business planning cycle and provide an update in January.

Trading and Marketing Business

"Although energy trading has been under severe pressure, the trading and marketing business is an integral part of Duke Energy's ongoing strategy of maximizing returns on our asset positions while providing valuable risk management services to our energy customers."

The company has continued its comprehensive review of its trading activities following the interim reply last week to the Security and Exchange Commission's (SEC) informal data request regarding round-trip trading. The SEC response is being finalized and will be filed shortly.

Duke Energy has concluded its investigation and has determined that there is no material financial impact in current or prior periods. In the course of the investigations, the company identified the need to strengthen some aspects of its trading operations and is taking appropriate management actions.

BUSINESS UNIT RESULTS

The company's Energy Services businesses, which include DENA, International Energy and Other Energy Services segments, delivered combined EBIT of $335 million for second quarter, compared to $328 million during the same period last year. The company revised the reporting segments within Energy Services to provide greater transparency into DENA's operations. Duke Energy Merchants (DEM) is now reported in the Other Energy Services segment.

Duke Energy North America

DENA, which includes Duke Energy's 60 percent share of interest in Duke Energy Trading and Marketing (DETM), reported EBIT of $196 million for the quarter, compared to $272 million in EBIT during second quarter 2001. Last year's second quarter included net gains from the sale of interests in power plants and DENA's ability to profit from atypical levels of market volatility, whereas this quarter's results were achieved in a market with reduced spark spreads and lower volatility. Also, the 2002 second quarter EBIT includes the appreciation of the fair value of the mark-to-market portfolio of $46 million as a result of applying improved and standardized valuation modeling techniques for all North American regions.

Year-to-date EBIT for DENA is $250 million, compared to $656 million in 2001.

During the quarter, DENA added 5,120 megawatts to its merchant portfolio, all ahead of schedule and under budget. An additional 1,380 megawatts were brought on line in July with the remaining 160 megawatts scheduled for commercial operation in August. This additional generation will bring DENA's operating portfolio to more than 14,000 megawatts, providing DENA with significant earnings growth opportunities in the third quarter and beyond.

DENA also announced origination transactions with Nevada Power and Georgia Power as well as the sale of its ownership interest in the Fredrickson generating facility in Washington.

International Energy

For second quarter 2002, the International Energy segment, composed of the Asia-Pacific, Latin American and European regional businesses of Duke Energy International (DEI), delivered EBIT of $67 million, essentially flat compared to second quarter 2001. Results for the quarter were positively impacted by strong performance throughout DEI's Latin American portfolio, and by the addition to DEI's portfolio of assets associated with Duke Energy's acquisition of Westcoast Energy. These positive impacts were offset by lower results in Europe due to decreased liquidity and margin. Year-to-date EBIT was $134 million, as compared to $144 million in 2001.

During the quarter, DEI made significant progress on the construction of the Tasmania Natural Gas Pipeline, which is on schedule for commercial operation in third quarter 2002, and on the construction of the company's new 165-megawatt plant in Guatemala.

Other Energy Services

Other Energy Services, the financial reporting unit that includes Duke/Fluor Daniel (D/FD) and DEM, reported EBIT of $72 million for second quarter 2002, versus an EBIT loss of $12 million in second quarter 2001. Year-to-date EBIT was $83 million, as compared to an EBIT loss of $44 million in 2001.

D/FD's results for the quarter were positively impacted by the completion of 10 plants, which on average were completed more than two weeks ahead of schedule. Most of the plants completed during the quarter were constructed for DENA. As such, the related profit is eliminated in the consolidation of Duke Energy's reported EBIT.

Also during the quarter, Duke Energy closed the sale of Duke Engineering & Services to French-based Framatome ANP Inc. and the sale of DukeSolutions to Framingham, Mass.-based Ameresco Inc. The net gain taken in second quarter 2002 for these sales was $14 million. DEM benefited from a gain of $15 million on the sale of Duke Energy's interest in Canadian 88, which was offset by lower commodity pricing impacting its trading results.

Gas Transmission

The Natural Gas Transmission segment reported second quarter EBIT of $312 million, a 120-percent increase over the $142 million in second quarter 2001. Results included the first full quarter of earnings from the recently acquired Westcoast Energy natural gas transmission and distribution assets, which contributed $109 million to second quarter EBIT.

Earnings associated with the Gulfstream Natural Gas System, inclusive of a $27 million fee for the successful completion of this pipeline that went into service in May, also contributed to the increase. Gulfstream, a 581-mile pipeline system, 50-percent-owned by Duke Energy, is the first new pipeline to serve Florida in 40 years and the largest interstate pipeline in the Gulf of Mexico.

Year-to-date EBIT for Gas Transmission was $580 million, as compared to $317 million in 2001.

Field Services

The Field Services business segment, which represents Duke Energy's majority interest in Duke Energy Field Services (DEFS), reported EBIT of $41 million as compared to $84 million in second quarter 2001. Results were primarily affected by a decrease in natural gas liquids (NGL) prices and increased operating costs. The average NGL price per gallon was 37 cents in the quarter, as opposed to 48 cents in second quarter 2001. Additionally, the company increased its reserves primarily for imbalances with customers and suppliers by $12 million and took a charge of $6 million for storage inventory write-down. The EBIT impact to Duke Energy after minority interest is $13 million. Acquisition of a 33-percent interest in Discovery Pipeline was completed during second quarter.

Year-to-date EBIT for Field Services was $76 million, as compared to $207 million in 2001.

Franchised Electric

EBIT from Duke Energy's franchised electric business was $389 million versus $361 million for second quarter 2001. This increase is primarily due to reduced maintenance expenses in 2002 as compared to last year's second quarter. Favorable weather conditions in 2002, compared to 2001, were offset by lower sales to industrial customers affected by economic downturn.

Year-to-date EBIT for Franchised Electric was $774 million, as compared to $821 million in 2001.

Next year Duke Power will begin the seven-year amortization of the estimated $1.5 billion in planned expenditures called for in the recently passed "clean air" legislation in North Carolina. This landmark state legislation will allow Duke Power to meet rigorous new state standards for power plant emissions, while keeping electric rates frozen for five years.

Duke Ventures

The Duke Ventures business segment, composed of Crescent Resources, DukeNet Communications and Duke Capital Partners, reported EBIT of $56 million for second quarter 2002, versus $36 million for second quarter 2001. The increase is primarily due to a gain of $30 million on the sale of water assets. Year-to-date EBIT for Duke Ventures was $62 million, as compared to $43 million in 2001.

FINANCIAL STATEMENTS

Duke Energy increased disclosure by releasing its income statement, balance sheet and condensed cash flow statement.

OTHER IMPACT ON EARNINGS AVAILABLE FOR COMMON

Interest expense was $264 million for second quarter 2002, as compared to $202 million for second quarter 2001. The increase is primarily due to debt acquired in conjunction with the Westcoast Energy acquisition.

TRADING AND RISK MANAGEMENT

Duke Energy released the following metrics for its trading and marketing operations. Daily earnings at risk (DER), a measure of the likely one-day favorable or unfavorable movements in commodity prices and their corresponding effects on EBIT within Duke Energy's trading portfolio, averaged $15 million in second quarter 2002. The average DER for second quarter 2001 was $27 million.

DENA's merchant generation portfolio (the "accrual book") -- including merchant generation facilities and hedging contracts held for power, natural gas, crude oil and petroleum products had a total estimated value of $6.4 billion as of June 30, 2002. On a cumulative basis, approximately 9 percent of the fair value of these contracts is expected to be realized by the end of 2002, 20 percent through 2003, 31 percent through 2004 and the remainder in 2005 and beyond.

The expected DENA North American merchant generation output hedged for 2003 is 72 percent, for 2004 is 56 percent and for 2005 is 55 percent.

The value of Duke Energy's portfolio attributable to trading contracts, or its mark-to-market (MTM) trading portfolio book, was $1.2 billion, or 16 percent of the total. On a cumulative basis, approximately 22 percent of the fair value of these contracts is expected to be realized by the end of 2002, 40 percent through 2003, 56 percent through 2004 and the remainder in 2005 and beyond. Under MTM accounting rules, the change in the fair value of trading contracts is recognized in earnings during the current period. The unrealized MTM margin for second quarter 2002 was a positive margin of $103 million compared with a negative margin of approximately $68 million for first quarter 2002.

Duke Energy is a diversified multinational energy company with an integrated network of energy assets and expertise. The company manages a dynamic portfolio of natural gas and supply, delivery and trading businesses - meeting the energy needs of customers throughout North America and in key markets around the world. Duke Energy, headquartered in Charlotte, N.C., is a Fortune 100 company traded on the New York Stock Exchange under the symbol DUK. More information about the company is available on the Internet at: www.duke-energy.com.

An earnings conference call for analysts is scheduled for 10 a.m. ET today. The conference call can be accessed via the investors' section of Duke Energy's Web site or by dialing 800/946-0783 in the United States or 719/457-2658 outside the United States. The confirmation code is 718838. Please call in 5 to10 minutes prior to the scheduled start time. A replay of the conference call will be available for 30 days by dialing 888/203-1112 with a confirmation code of 718838. The international replay number is 719/457-0820, confirmation code 718838. A replay and transcript also will be available by accessing the investors' section of the company's Web site.

This document includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Although Duke Energy believes that its expectations are based on reasonable assumptions, it can give no assurance that its goals will be achieved. Important factors that could cause actual results to differ materially from those in the forward-looking statements herein include legislative and regulatory developments; the outcomes of litigation and regulatory proceedings or inquiries; the effectiveness of the company's risk management and internal controls systems; the timing and extent of changes in commodity prices for oil, gas, coal, electricity and interest rates; the extent of success in connecting natural gas supplies to gathering and processing systems and in connecting and expanding gas and electric markets; the performance of electric generation, pipeline and gas processing facilities; the timing and success of efforts to develop domestic and international power, pipeline, gathering, processing and other infrastructure projects; conditions of the capital markets and equity markets during the periods covered by the forward-looking statements and other factors discussed in Duke Energy's filings with the Securities and Exchange Commission.


JUNE 2002
QUARTERLY HIGHLIGHTS
(unaudited)

Three Months Ended

Six Months Ended

June 30,

June 30,

 

(In millions, except where noted)

2002

2001

2002

2001


COMMON STOCK DATA

  Earnings Per Share (before cumulative effect of
  change in accounting principle)

 
    Basic
$0.57
$0.54
$1.05
$1.27
    Diluted
$0.56
$0.53
$1.04
$1.26
  Earnings Per Share
    Basic
$0.57
$0.54
$1.05
$1.14
    Diluted
$0.56
$0.53
$1.04
$1.13
  Dividends Per Share
$0.550
$0.550
$0.825
$0.825
  Weighted Average Shares Outstanding
    Basic
831
773
809
759
    Diluted
834
779
813
765

INCOME
  Operating Revenues
$16,333
$15,580
$28,218
$32,071
 



  Earnings Before Interest and Taxes (EBIT)
1,047
902
1,808
2,156
  Interest Expense
264
202
453
415
  Minority Interests (a)
62
45
94
205
  Income Taxes
247
236
405
563
  Cumulative Effect of Change in Accounting
    Principle, Net of Tax
-
-
-
96
 



  Net Income
474
419
856
877
  Preferred Stock Dividends and Redemption
    Premiums
4
4
7
8
 



  Earnings Available for Common Stockholders
$470
$415
$849
$869
 




CAPITALIZATION
  Common Equity
36%
41%
  Minority Interest
7%
8%
  Preferred Stock
1%
1%
  Trust Preferred Securities
3%
5%
  Total Debt
53%
45%
Fixed Charges Coverage, using SEC guidelines
2.7
3.6
Total Debt
$22,010
$12,522
Book Value Per Share
$17.71
$15.61
Actual Shares Outstanding
832
775

CAPITAL AND INVESTMENT EXPENDITURES
  Franchised Electric
$323
$275
$567
$452
  Natural Gas Transmission (b)
253
207
2,273
286
  Field Services
74
261
184
307
  Duke Energy North America (c)
785
830
1,521
1,326
  International Energy
136
135
217
158
  Other Energy Services (c)
13
20
22
47
  Duke Ventures
158
189
283
363
  Other Operations (d)
(36)
34
-
59
  Cash acquired in acquisitions
-
(5)
(77)
(5)
 



  Total Capital and Investment Expenditures
$1,706
$1,946
$4,990
$2,993
 




EBIT BY BUSINESS SEGMENT
  Franchised Electric
$389
$361
$774
$821
  Natural Gas Transmission
312
142
580
317
  Field Services
41
84
76
207
  Duke Energy North America
196
272
250
656
  International Energy
67
68
134
144
  Other Energy Services
72
(12)
83
(44)
  Duke Ventures
56
36
62
43
  Other Operations
(128)
(73)
(207)
(143)
 



 Total Segment EBIT
1,005
878
1,752
2,001
  EBIT Attributable to Minority Interests
42
24
56
155
 



 Total EBIT
$1,047
$902
$1,808
$2,156
 




 
(a) Includes expense related to preferred securities of subsidiaries of $35 million and $41 million for the three months ended and $70 and $87 million for the six months ended June 30, 2002 and 2001, respectively.
(b) Six months ended June 30, 2002 amount includes $1.7 billion (net of cash acquired) paid to Westcoast Energy shareholders related to the acquisition.
(c) Prior to June 30, 2002, the Duke Energy North America business segment was combined with Duke Energy Merchants Holdings, LLC (DEM) to form a segment called North American Wholesale Energy. During 2002, management combined DEM with the Other Energy Services segment.

(d) Other Operations includes corporate expenses and elimination of intersegment capital expenditures.

Note: Prior year information has been restated to conform to current year presentation


JUNE 2002
QUARTERLY HIGHLIGHTS
(unaudited)

Three Months Ended

Six Months Ended

June 30,

June 30,

 

(In millions, except where noted)

2002

2001

2002

2001


FRANCHISED ELECTRIC
  Operating Revenues
$1,162
$1,154
$2,275
$2,311
  Operating Expenses
790
779
1,536
1,527
  Other Income (Expense)
17
(14)
35
37
 



  EBIT
$389
$361
$774
$821
 



  Sales, GWh
20,418
20,221
39,939
39,583

NATURAL GAS TRANSMISSION

  Operating Revenues
$678
$264
$1,162
$546
  Operating Expenses
361
125
579
232
  Other Income
4
3
9
3
  Minority Interest Expense
9
-
12
-
 



  EBIT
$312
$142
$580
$317
 



Proportional Throughput, TBtu
702
368
1,372
916

FIELD SERVICES
  Operating Revenues
$1,812
$2,538
$3,378
$5,936
  Operating Expenses
1,758
2,406
3,281
5,625
  Minority Interest Expense
13
48
21
104
 



  EBIT
$41
$84
$76
$207
 



  Natural Gas Gathered and
  Processed/Transported, TBtu/day
8.4
8.5
8.4
8.4
  Natural Gas Liquids Production,
  MBbl/d
392.0
406.7
390.4
386.9
  Natural Gas Marketed, TBtu/day
1.6
1.6
1.6
1.6
  Average Natural Gas Price
  per MMBtu
$3.40
$4.67
$2.86
$5.88
  Average Natural Gas Liquids
  Price per Gallon
$0.37
$0.48
$0.34
$0.54

DUKE ENERGY NORTH AMERICA

  Operating Revenues
$9,443
$10,051
$16,235
$21,121
  Operating Expenses
9,237
9,824
15,975
20,431
  Other Income
4
15
3
4
  Minority Interest Expense
  (Benefit)
14
(30)
13
38
 



  EBIT
$196
$272
$250
$656
 



  Natural Gas Marketed, TBtu/day
15.3
11.2
14.2
12.3
  Electricity Marketed and Traded,
  GWh
101,210
66,225
202,565
110,842

  Proportional MW Capacity in Operation

12,671
6,846

  Proportional MW Capacity Owned (a)

18,671
13,231

  Estimated Proportional Investment
  in Project Net Assets (a) (b)

$8,349
$5,852

INTERNATIONAL ENERGY
  Operating Revenues
$1,190
$399
$2,176
$901
  Operating Expenses
1,125
334
2,052
762
  Other Income
8
9
21
18
  Minority Interest Expense
6
6
11
13
 



  EBIT
$67
$68
$134
$144
 



  Sales, GWh (c)
5,014 
4,596 
9,946 
9,037 
  Natural Gas Marketed, TBtu/day
1,447
705
2,443
1,422
  Electricity Marketed and Traded,
  GWh
24,740
1,632
41,872
3,391

  Proportional MW Capacity in Operation

4,971
4,241

  Proportional MW Capacity Owned (a)

5,746
4,844

  Proportional Maximum Pipeline Capacity in Operation,
  MMcf/d

363
255

  Proportional Maximum Pipeline Capacity Owned,
  MMcf/d (a)

363
363

  Estimated Proportional Investment
  in Project Net Assets (a) (d)

$4,036
$3,077

OTHER ENERGY SERVICES
  Operating Revenues
$2,388
$1,591
$3,718
$2,777
  Operating Expenses
2,333
1,606
3,652
2,826
  Other Income
17
3
17
5
 



  EBIT
$72
$(12)
$83
$(44)
 




DUKE VENTURES
  Operating Revenues
$111
$98
$150
$135
  Operating Expenses
55
62
89
92
  Minority Interest Benefit
-
-
(1)
-
 



  EBIT
$56
$36
$62
$43
 



 

 
(a) Amount includes projects under construction or under contract as of the period end.
(b) Includes total proportional estimated costs to complete projects under construction or under contract of $1,746 million and $2,010 million as of June 30, 2002 and 2001, respectively.
(c) Represents GWh sold by the operating assets to consumers, industrial users, etc.
(d) Includes total proportional estimated costs to complete projects under construction or under contract of $563 million and $160 million as of June 30, 2002 and 2001, respectively.

CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
(In millions, except per share amounts)

Three Months Ended

Six Months Ended

June 30,

June 30,



2002

2001

2002

2001

 



Operating Revenues

Sales, trading and marketing of natural gas and petroleum products

$10,676

$7,809

$16,305

$19,260

Trading and marketing of electricity

3,853

5,865

7,880

9,168

Generation, transmission and distribution of electricity

958

1,238

2,661

2,498

Transportation and storage of natural gas

447

233

773

479

Other

399

435

599

666

 



Total operating revenues

16,333

15,580

28,218

32,071

 



Operating Expenses

Natural gas and petroleum products purchased

10,278

7,599

15,740

18,679

Net interchange and purchased power

3,442

5,484

7,636

8,163

Fuel used in electric generation

237

223

452

465

Other operation and maintenance

859

964

1,711

1,841

Depreciation and amortization

397

326

741

642

Property and other taxes

132

104

259

219

 



Total operating expenses

15,345

14,700

26,539

30,009

 



Operating Income

988

880

1,679

2,062

Other Income and Expenses

59

22

129

94

Interest Expense

264

202

453

415

Minority Interest Expense

62

45

94

205

 



Earnings Before Income Taxes

721

655

1,261

1,536

Income Taxes

247

236

405

563

 



Income Before Cumulative Effect of Change in Accounting Principle

474

419

856

973

Cumulative Effect of Change in Accounting Principle, net of tax

-

-

-

(96)

 



Net Income

474

419

856

877

Preferred and Preference Stock Dividends

4

4

7

8

Earnings Available For Common Stockholders

$470

$415

$849

$869

 



Common Stock Data

Weighted-average shares outstanding

831

773

809

759

Earnings per share (before cumulative effect of change in accounting principle)

Basic

$0.57

$0.54

$1.05

$1.27

Diluted

$0.56

$0.53

$1.04

$1.26

Earnings per share

Basic

$0.57

$0.54

$1.05

$1.14

Diluted

$0.56

$0.53

$1.04

$1.13

Dividends per share

$0.550

$0.550

$0.825

$0.825


CONSOLIDATED BALANCE SHEETS
(In millions)

June 30,

December 31,

2002

2001

(Unaudited)

 

ASSETS

Current Assets

Cash and cash equivalents

$87

$290

Receivables

6,597

5,301

Inventory

1,174

1,017

Current portion of purchased capacity costs

173

160

Unrealized gains on mark-to-market and hedging transactions

3,326

2,326

Other

780

451

 

Total current assets

12,137

9,545

 

Investments and Other Assets

Investments in affiliates

2,256

1,480

Nuclear decommissioning trust funds

680

716

Pre-funded pension costs

339

313

Goodwill, net of accumulated amortization

4,125

1,730

Notes receivable

641

576

Unrealized gains on mark-to-market and hedging transactions

5,303

3,117

Other

1,384

1,299

 

Total investments and other assets

14,728

9,231

 

Property, Plant and Equipment

Cost

48,219

39,464

Less accumulated depreciation and amortization

11,835

11,049

 

Net property, plant and equipment

36,384

28,415

 

Regulatory Assets and Deferred Debits

Purchased capacity costs

65

189

Deferred debt expense

228

203

Regulatory asset related to income taxes

546

510

Other

1,163

282

 

Total regulatory assets and deferred debits

2,002

1,184

 

     
     
Total Assets  
$65,251
$48,375
 

     

LIABILITIES AND COMMON STOCKHOLDERS' EQUITY

 

Current Liabilities

Accounts payable

$5,254

$4,231

Notes payable and commercial paper

2,673

1,603

Taxes accrued

857

443

Interest accrued

335

239

Current maturities of long-term debt and preferred stock

1,033

274

Unrealized losses on mark-to-market and hedging transactions

2,794

1,519

Other

1,834

2,118

 

Total current liabilities

14,780

10,427

 

Long-term Debt

18,319

12,321

 

Deferred Credits and Other Liabilities

Deferred income taxes

4,696

4,307

Investment tax credit

182

189

Nuclear decommissioning costs externally funded

680

716

Environmental cleanup liabilities

50

85

Unrealized losses on mark-to-market and hedging transactions

3,914

2,212

Other

3,108

1,542

 

Total deferred credits and other liabilities

12,630

9,051

 

Commitments and Contingencies

Guaranteed Preferred Beneficial Interests in Subordinated

Notes of Duke Energy Corporation or Subsidiaries

1,407

1,407

 

Minority Interests in Financing Subsidiary

1,025

1,025

 

Minority Interests

1,971

1,221

 

Preferred and Preference Stock

Preferred and preference stock with sinking fund requirements

23

25

Preferred and preference stock without sinking fund requirements

209

209

 

Total preferred and preference stock

232

234

 

Common Stockholders' Equity

Common stock, no par, 2 billion shares authorized; 832

   

million and 777 million shares outstanding at June 30, 2002 and December 31, 2001, respectively

8,184

6,217

Retained earnings

6,553

6,292

Accumulated other comprehensive income

150

180

 

Total common stockholders' equity

14,887

12,689

 

Total Liabilities and Common Stockholders' Equity

$65,251

$48,375

 


CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(In millions)

Six Months Ended

June 30,


2002

2001



CASH FLOWS FROM OPERATING ACTIVITIES

Net Income

$856

$877

Adjustments to reconcile net income to net cash provided by operating activities:

 

Depreciation and amortization

789

718

Net unrealized mark-to-market and hedging transactions

(27)

(211)

Change in working capital and other

(72)

827



Net cash provided by operating activities

1,546

2,211

CASH FLOWS FROM INVESTING ACTIVITIES

(4,647)

(2,273)

CASH FLOWS FROM FINANCING ACTIVITIES

2,898

681



Net (decrease) increase in cash and cash equivalents

(203)

619

Cash and cash equivalents at beginning of period

290

622



Cash and cash equivalents at end of period

$87

$1,241