|
Commission
|
|
Registrant; State of Incorporation;
|
|
I.R.S. Employer
|
|||
File Number
|
|
Address; and Telephone Number
|
|
Identification No.
|
|||
|
|
|
|
|
|
|
|
333-21011
|
|
FIRSTENERGY CORP
|
|
34-1843785
|
|||
|
|
(An
|
Ohio
|
Corporation)
|
|
|
|
|
|
76 South Main Street
|
|
|
|||
|
|
Akron
|
OH
|
44308
|
|
|
|
|
|
Telephone
|
(800)
|
736-3402
|
|
|
|
|
|
|
|
|
|
|
|
Title of Each Class
|
|
Trading Symbol
|
|
Name of Each Exchange on Which Registered
|
Common Stock, $0.10 par value
|
|
FE
|
|
New York Stock Exchange
|
Yes
|
☑
|
No
|
☐
|
|
Yes
|
☑
|
No
|
☐
|
|
Yes
|
☐
|
No
|
☑
|
|
|
|
OUTSTANDING
|
|
CLASS
|
|
AS OF MARCH 31, 2020
|
|
Common Stock, $0.10 par value
|
|
541,753,695
|
|
|
•
|
The extent and duration of the novel coronavirus (known as COVID-19) and the impacts to our business, operations and financial condition resulting from the outbreak of COVID-19 including, but not limited to, disruption of businesses in our territories, volatile capital and credit markets, legislative and regulatory actions, the effectiveness of our pandemic and business continuity plans, the precautionary measures we are taking on behalf of our customers and employees, our customers’ ability to make their utility payment and the potential for supply-chain disruptions.
|
•
|
Mitigating exposure for remedial activities associated with retired and formerly owned electric generation assets, including, but not limited to, risks associated with the decommissioning of TMI-2.
|
•
|
The ability to accomplish or realize anticipated benefits from strategic and financial goals, including, but not limited to, executing our transmission and distribution investment plans, controlling costs, improving our credit metrics, strengthening our balance sheet and growing earnings.
|
•
|
Legislative and regulatory developments, including, but not limited to, matters related to rates, compliance and enforcement activity.
|
•
|
Economic and weather conditions affecting future operating results, such as significant weather events and other natural disasters, and associated regulatory events or actions.
|
•
|
Changes in assumptions regarding economic conditions within our territories, the reliability of our transmission and distribution system, or the availability of capital or other resources supporting identified transmission and distribution investment opportunities.
|
•
|
Changes in customers’ demand for power, including, but not limited to, the impact of climate change or energy efficiency and peak demand reduction mandates.
|
•
|
Changes in national and regional economic conditions affecting us and/or our major industrial and commercial customers or others with which we do business.
|
•
|
The risks associated with cyber-attacks and other disruptions to our information technology system, which may compromise our operations, and data security breaches of sensitive data, intellectual property and proprietary or personally identifiable information.
|
•
|
The ability to comply with applicable reliability standards and energy efficiency and peak demand reduction mandates.
|
•
|
Changes to environmental laws and regulations, including, but not limited to, those related to climate change.
|
•
|
Changing market conditions affecting the measurement of certain liabilities and the value of assets held in our pension trusts and other trust funds, or causing us to make contributions sooner, or in amounts that are larger, than currently anticipated.
|
•
|
The risks and uncertainties associated with litigation, arbitration, mediation and like proceedings.
|
•
|
Labor disruptions by our unionized workforce.
|
•
|
Changes to significant accounting policies.
|
•
|
Any changes in tax laws or regulations, or adverse tax audit results or rulings.
|
•
|
The ability to access the public securities and other capital and credit markets in accordance with our financial plans, the cost of such capital and overall condition of the capital and credit markets affecting us, including the increasing number of financial institutions evaluating the impact of climate change on their investment decisions.
|
•
|
Actions that may be taken by credit rating agencies that could negatively affect either our access to or terms of financing or our financial condition and liquidity.
|
•
|
The risks and other factors discussed from time to time in our SEC filings.
|
TABLE OF CONTENTS
|
|
|
Page
|
|
|
Part I. Financial Information
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated Statements of Stockholders’ Equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
AE Supply
|
Allegheny Energy Supply Company, LLC, an unregulated generation subsidiary
|
AGC
|
Allegheny Generating Company, a generation subsidiary of MP
|
ATSI
|
American Transmission Systems, Incorporated, a subsidiary of FET, which owns and operates transmission facilities
|
BSPC
|
Bay Shore Power Company
|
CEI
|
The Cleveland Electric Illuminating Company, an Ohio electric utility operating subsidiary
|
FE
|
FirstEnergy Corp., a public utility holding company
|
FENOC
|
Energy Harbor Nuclear Corp. (formerly known as FirstEnergy Nuclear Operating Company), a subsidiary of EH, which operates NG’s nuclear generating facilities
|
FES
|
Energy Harbor LLC. (formerly known as FirstEnergy Solutions Corp.), a subsidiary of EH, which provides energy-related products and services
|
FES Debtors
|
FES, FENOC, FG, NG, FE Aircraft Leasing Corp., Norton Energy Storage LLC, and FGMUC
|
FESC
|
FirstEnergy Service Company, which provides legal, financial and other corporate support services
|
FET
|
FirstEnergy Transmission, LLC, the parent company of ATSI, MAIT and TrAIL, and has a joint venture in PATH
|
FEV
|
FirstEnergy Ventures Corp., which invests in certain unregulated enterprises and business ventures
|
FG
|
Energy Harbor Generation LLC (formerly known as FirstEnergy Generation, LLC), a subsidiary of EH, which owns and operates fossil generating facilities
|
FGMUC
|
FirstEnergy Generation Mansfield Unit 1 Corp., a subsidiary of FG
|
FirstEnergy
|
FirstEnergy Corp., together with its consolidated subsidiaries
|
Global Holding
|
Global Mining Holding Company, LLC, a joint venture between FEV, WMB Marketing Ventures, LLC and Pinesdale LLC
|
Global Rail
|
Global Rail Group, LLC, a subsidiary of Global Holding that owns coal transportation operations near Roundup, Montana
|
GPUN
|
GPU Nuclear, Inc., a subsidiary of FE, which operates TMI-2
|
JCP&L
|
Jersey Central Power & Light Company, a New Jersey electric utility operating subsidiary
|
MAIT
|
Mid-Atlantic Interstate Transmission, LLC, a subsidiary of FET, which owns and operates transmission facilities
|
ME
|
Metropolitan Edison Company, a Pennsylvania electric utility operating subsidiary
|
MP
|
Monongahela Power Company, a West Virginia electric utility operating subsidiary
|
NG
|
Energy Harbor Nuclear Generation LLC (formerly known as FirstEnergy Nuclear Generation, LLC), a subsidiary of EH, which owns nuclear generating facilities
|
OE
|
Ohio Edison Company, an Ohio electric utility operating subsidiary
|
Ohio Companies
|
CEI, OE and TE
|
PATH
|
Potomac-Appalachian Transmission Highline, LLC, a joint venture between FE and a subsidiary of AEP
|
PATH-Allegheny
|
PATH Allegheny Transmission Company, LLC
|
PATH-WV
|
PATH West Virginia Transmission Company, LLC
|
PE
|
The Potomac Edison Company, a Maryland and West Virginia electric utility operating subsidiary
|
Penn
|
Pennsylvania Power Company, a Pennsylvania electric utility operating subsidiary of OE
|
Pennsylvania Companies
|
ME, PN, Penn and WP
|
PN
|
Pennsylvania Electric Company, a Pennsylvania electric utility operating subsidiary
|
Signal Peak
|
Signal Peak Energy, LLC, an indirect subsidiary of Global Holding that owns mining operations near Roundup, Montana
|
TE
|
The Toledo Edison Company, an Ohio electric utility operating subsidiary
|
TrAIL
|
Trans-Allegheny Interstate Line Company, a subsidiary of FET, which owns and operates transmission facilities
|
Transmission Companies
|
ATSI, MAIT and TrAIL
|
Utilities
|
OE, CEI, TE, Penn, JCP&L, ME, PN, MP, PE and WP
|
WP
|
West Penn Power Company, a Pennsylvania electric utility operating subsidiary
|
|
|
PUCO
|
Public Utilities Commission of Ohio
|
|
SIP
|
State Implementation Plan(s) Under the Clean Air Act
|
PURPA
|
Public Utility Regulatory Policies Act of 1978
|
|
SO2
|
Sulfur Dioxide
|
RCRA
|
Resource Conservation and Recovery Act
|
|
SOS
|
Standard Offer Service
|
Regulation FD
|
Regulation Fair Disclosure promulgated by the SEC
|
|
SREC
|
Solar Renewable Energy Credit
|
RFC
|
ReliabilityFirst Corporation
|
|
SSO
|
Standard Service Offer
|
RFP
|
Request for Proposal
|
|
Tax Act
|
Tax Cuts and Jobs Act adopted December 22, 2017
|
RGGI
|
Regional Greenhouse Gas Initiative
|
|
TMI-2
|
Three Mile Island Unit 2
|
ROE
|
Return on Equity
|
|
Twitter®
|
Twitter is a registered trademark of Twitter, Inc.
|
RTEP
|
Regional Transmission Expansion Plan
|
|
UCC
|
Official committee of unsecured creditors appointed in connection with the FES Bankruptcy
|
RTO
|
Regional Transmission Organization
|
|
VIE
|
Variable Interest Entity
|
S&P
|
Standard & Poor’s Ratings Service
|
|
VMS
|
Vegetation Management Surcharge
|
SBC
|
Societal Benefits Charge
|
|
VSCC
|
Virginia State Corporation Commission
|
SCOH
|
Supreme Court of Ohio
|
|
WVPSC
|
Public Service Commission of West Virginia
|
SEC
|
United States Securities and Exchange Commission
|
|
ZEC
|
Zero Emissions Certificate
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Three Months Ended March 31,
|
||||||
(In millions, except per share amounts)
|
|
2020
|
|
2019
|
||||
|
|
|
|
|
||||
REVENUES:
|
|
|
|
|
||||
Distribution services and retail generation
|
|
$
|
2,124
|
|
|
$
|
2,309
|
|
Transmission
|
|
397
|
|
|
352
|
|
||
Other
|
|
188
|
|
|
222
|
|
||
Total revenues(1)
|
|
2,709
|
|
|
2,883
|
|
||
|
|
|
|
|
||||
OPERATING EXPENSES:
|
|
|
|
|
||||
Fuel
|
|
98
|
|
|
131
|
|
||
Purchased power
|
|
694
|
|
|
781
|
|
||
Other operating expenses
|
|
749
|
|
|
779
|
|
||
Provision for depreciation
|
|
317
|
|
|
297
|
|
||
Amortization of regulatory assets, net
|
|
52
|
|
|
5
|
|
||
General taxes
|
|
267
|
|
|
261
|
|
||
Total operating expenses
|
|
2,177
|
|
|
2,254
|
|
||
|
|
|
|
|
||||
OPERATING INCOME
|
|
532
|
|
|
629
|
|
||
|
|
|
|
|
||||
OTHER INCOME (EXPENSE):
|
|
|
|
|
||||
Miscellaneous income, net
|
|
100
|
|
|
54
|
|
||
Pension and OPEB mark-to-market adjustment (Note 5)
|
|
(423
|
)
|
|
—
|
|
||
Interest expense
|
|
(263
|
)
|
|
(253
|
)
|
||
Capitalized financing costs
|
|
18
|
|
|
18
|
|
||
Total other expense
|
|
(568
|
)
|
|
(181
|
)
|
||
|
|
|
|
|
||||
INCOME (LOSS) BEFORE INCOME TAXES (BENEFITS)
|
|
(36
|
)
|
|
448
|
|
||
|
|
|
|
|
||||
INCOME TAXES (BENEFITS)
|
|
(60
|
)
|
|
93
|
|
||
|
|
|
|
|
||||
INCOME FROM CONTINUING OPERATIONS
|
|
24
|
|
|
355
|
|
||
|
|
|
|
|
||||
Discontinued operations (Note 3)(2)
|
|
50
|
|
|
(35
|
)
|
||
|
|
|
|
|
||||
NET INCOME
|
|
$
|
74
|
|
|
$
|
320
|
|
|
|
|
|
|
||||
INCOME ALLOCATED TO PREFERRED STOCKHOLDERS (Note 4)
|
|
—
|
|
|
5
|
|
||
|
|
|
|
|
||||
NET INCOME ATTRIBUTABLE TO COMMON STOCKHOLDERS
|
|
$
|
74
|
|
|
$
|
315
|
|
|
|
|
|
|
||||
EARNINGS PER SHARE OF COMMON STOCK (Note 4):
|
|
|
|
|
||||
Basic - Continuing Operations
|
|
$
|
0.05
|
|
|
$
|
0.66
|
|
Basic - Discontinued Operations
|
|
0.09
|
|
|
(0.07
|
)
|
||
Basic - Net Income Attributable to Common Stockholders
|
|
$
|
0.14
|
|
|
$
|
0.59
|
|
|
|
|
|
|
||||
Diluted - Continuing Operations
|
|
$
|
0.05
|
|
|
$
|
0.66
|
|
Diluted - Discontinued Operations
|
|
0.09
|
|
|
(0.07
|
)
|
||
Diluted - Net Income Attributable to Common Stockholders
|
|
$
|
0.14
|
|
|
$
|
0.59
|
|
|
|
|
|
|
||||
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING:
|
|
|
|
|
||||
Basic
|
|
541
|
|
|
530
|
|
||
Diluted
|
|
543
|
|
|
533
|
|
||
|
|
|
|
|
|
|
For the Three Months Ended March 31,
|
||||||
(In millions)
|
|
2020
|
|
2019
|
||||
|
|
|
|
|
||||
NET INCOME
|
|
$
|
74
|
|
|
$
|
320
|
|
|
|
|
|
|
||||
OTHER COMPREHENSIVE INCOME (LOSS):
|
|
|
|
|
|
|
||
Pension and OPEB prior service costs
|
|
(23
|
)
|
|
(7
|
)
|
||
Amortized losses on derivative hedges
|
|
—
|
|
|
1
|
|
||
Other comprehensive loss
|
|
(23
|
)
|
|
(6
|
)
|
||
Income tax benefits on other comprehensive loss
|
|
(5
|
)
|
|
(1
|
)
|
||
Other comprehensive loss, net of tax
|
|
(18
|
)
|
|
(5
|
)
|
||
|
|
|
|
|
||||
COMPREHENSIVE INCOME
|
|
$
|
56
|
|
|
$
|
315
|
|
|
|
|
|
|
(In millions, except share amounts)
|
|
March 31,
2020 |
|
December 31,
2019 |
||||
ASSETS
|
|
|
|
|
|
|
||
CURRENT ASSETS:
|
|
|
|
|
|
|
||
Cash and cash equivalents
|
|
$
|
152
|
|
|
$
|
627
|
|
Restricted cash
|
|
33
|
|
|
52
|
|
||
Receivables-
|
|
|
|
|
|
|||
Customers
|
|
1,053
|
|
|
1,137
|
|
||
Less — Allowance for uncollectible customer receivables
|
|
44
|
|
|
46
|
|
||
|
|
1,009
|
|
|
1,091
|
|
||
Affiliated companies, net of allowance for uncollectible accounts of $1,063 in 2019
|
|
—
|
|
|
—
|
|
||
Other, net of allowance for uncollectible accounts of $26 in 2020 and $21 in 2019
|
|
245
|
|
|
203
|
|
||
Materials and supplies, at average cost
|
|
285
|
|
|
281
|
|
||
Prepaid taxes and other
|
|
279
|
|
|
157
|
|
||
Current assets - discontinued operations
|
|
—
|
|
|
33
|
|
||
|
|
2,003
|
|
|
2,444
|
|
||
PROPERTY, PLANT AND EQUIPMENT:
|
|
|
|
|
|
|
||
In service
|
|
42,184
|
|
|
41,767
|
|
||
Less — Accumulated provision for depreciation
|
|
11,635
|
|
|
11,427
|
|
||
|
|
30,549
|
|
|
30,340
|
|
||
Construction work in progress
|
|
1,456
|
|
|
1,310
|
|
||
|
|
32,005
|
|
|
31,650
|
|
||
|
|
|
|
|
||||
INVESTMENTS:
|
|
|
|
|
|
|
||
Nuclear fuel disposal trust
|
|
275
|
|
|
270
|
|
||
Other
|
|
288
|
|
|
299
|
|
||
Investments - held for sale (Note 10)
|
|
875
|
|
|
882
|
|
||
|
|
1,438
|
|
|
1,451
|
|
||
DEFERRED CHARGES AND OTHER ASSETS:
|
|
|
|
|
|
|
||
Goodwill
|
|
5,618
|
|
|
5,618
|
|
||
Regulatory assets
|
|
91
|
|
|
99
|
|
||
Other
|
|
935
|
|
|
1,039
|
|
||
|
|
6,644
|
|
|
6,756
|
|
||
|
|
$
|
42,090
|
|
|
$
|
42,301
|
|
LIABILITIES AND CAPITALIZATION
|
|
|
|
|
|
|
||
CURRENT LIABILITIES:
|
|
|
|
|
|
|
||
Currently payable long-term debt
|
|
$
|
381
|
|
|
$
|
380
|
|
Short-term borrowings
|
|
750
|
|
|
1,000
|
|
||
Accounts payable
|
|
898
|
|
|
918
|
|
||
Accounts payable - affiliated companies
|
|
—
|
|
|
87
|
|
||
Accrued interest
|
|
278
|
|
|
249
|
|
||
Accrued taxes
|
|
566
|
|
|
545
|
|
||
Accrued compensation and benefits
|
|
252
|
|
|
258
|
|
||
Other
|
|
572
|
|
|
1,425
|
|
||
|
|
3,697
|
|
|
4,862
|
|
||
CAPITALIZATION:
|
|
|
|
|
|
|
||
Stockholders’ equity-
|
|
|
|
|
|
|
||
Common stock, $0.10 par value, authorized 700,000,000 shares - 541,753,695 and 540,652,222 shares outstanding as of March 31, 2020 and December 31, 2019, respectively
|
|
54
|
|
|
54
|
|
||
Other paid-in capital
|
|
10,651
|
|
|
10,868
|
|
||
Accumulated other comprehensive income
|
|
2
|
|
|
20
|
|
||
Accumulated deficit
|
|
(3,893
|
)
|
|
(3,967
|
)
|
||
Total stockholders’ equity
|
|
6,814
|
|
|
6,975
|
|
||
Long-term debt and other long-term obligations
|
|
20,821
|
|
|
19,618
|
|
||
|
|
27,635
|
|
|
26,593
|
|
||
NONCURRENT LIABILITIES:
|
|
|
|
|
|
|
||
Accumulated deferred income taxes
|
|
2,774
|
|
|
2,849
|
|
||
Retirement benefits
|
|
3,455
|
|
|
3,065
|
|
||
Regulatory liabilities
|
|
2,266
|
|
|
2,360
|
|
||
Asset retirement obligations
|
|
168
|
|
|
165
|
|
||
Adverse power contract liability
|
|
38
|
|
|
49
|
|
||
Other
|
|
1,357
|
|
|
1,667
|
|
||
Noncurrent liabilities - held for sale (Note 10)
|
|
700
|
|
|
691
|
|
||
|
|
10,758
|
|
|
10,846
|
|
||
COMMITMENTS, GUARANTEES AND CONTINGENCIES (Note 10)
|
|
|
|
|
|
|
||
|
|
$
|
42,090
|
|
|
$
|
42,301
|
|
|
|
Three Months Ended March 31, 2020
|
||||||||||||||||||||||||||||
|
|
Series A Convertible Preferred Stock
|
|
Common Stock
|
|
OPIC
|
|
AOCI
|
|
Accumulated Deficit
|
|
Total Stockholders’ Equity
|
||||||||||||||||||
(In millions)
|
|
Shares
|
|
Amount
|
|
Shares
|
|
Amount
|
|
|
|
|||||||||||||||||||
Balance, January 1, 2020
|
|
—
|
|
|
$
|
—
|
|
|
541
|
|
|
$
|
54
|
|
|
$
|
10,868
|
|
|
$
|
20
|
|
|
$
|
(3,967
|
)
|
|
$
|
6,975
|
|
Net income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
74
|
|
|
74
|
|
||||||||||||
Other comprehensive loss, net of tax
|
|
|
|
|
|
|
|
|
|
|
|
(18
|
)
|
|
|
|
(18
|
)
|
||||||||||||
Stock-based compensation
|
|
|
|
|
|
|
|
|
|
9
|
|
|
|
|
|
|
9
|
|
||||||||||||
Stock Investment Plan and certain share-based benefit plans
|
|
|
|
|
|
1
|
|
|
|
|
(15
|
)
|
|
|
|
|
|
(15
|
)
|
|||||||||||
Cash dividends declared on common stock ($0.39/common share in March)
|
|
|
|
|
|
|
|
|
|
(211
|
)
|
|
|
|
|
|
(211
|
)
|
||||||||||||
Balance, March 31, 2020
|
|
—
|
|
|
$
|
—
|
|
|
542
|
|
|
$
|
54
|
|
|
$
|
10,651
|
|
|
$
|
2
|
|
|
$
|
(3,893
|
)
|
|
$
|
6,814
|
|
|
|
Three Months Ended March 31, 2019
|
||||||||||||||||||||||||||||
|
|
Series A Convertible Preferred Stock
|
|
Common Stock
|
|
OPIC
|
|
AOCI
|
|
Accumulated Deficit
|
|
Total Stockholders’ Equity
|
||||||||||||||||||
(In millions)
|
|
Shares
|
|
Amount
|
|
Shares
|
|
Amount
|
|
|
|
|||||||||||||||||||
Balance, January 1, 2019
|
|
0.7
|
|
|
$
|
71
|
|
|
512
|
|
|
$
|
51
|
|
|
$
|
11,530
|
|
|
$
|
41
|
|
|
$
|
(4,879
|
)
|
|
$
|
6,814
|
|
Net income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
320
|
|
|
320
|
|
||||||||||||
Other comprehensive loss, net of tax
|
|
|
|
|
|
|
|
|
|
|
|
(5
|
)
|
|
|
|
(5
|
)
|
||||||||||||
Stock-based compensation
|
|
|
|
|
|
|
|
|
|
7
|
|
|
|
|
|
|
7
|
|
||||||||||||
Stock Investment Plan and certain share-based benefit plans
|
|
|
|
|
|
1
|
|
|
|
|
|
1
|
|
|
|
|
|
|
1
|
|
||||||||||
Cash dividends declared on common stock ($0.38/common share in March)
|
|
|
|
|
|
|
|
|
|
(202
|
)
|
|
|
|
|
|
(202
|
)
|
||||||||||||
Cash dividends declared on preferred stock ($0.38/as-converted share in March)
|
|
|
|
|
|
|
|
|
|
(3
|
)
|
|
|
|
|
|
(3
|
)
|
||||||||||||
Conversion of Series A Convertible Preferred Stock (1)
|
|
(0.5
|
)
|
|
(50
|
)
|
|
18
|
|
|
2
|
|
|
48
|
|
|
|
|
|
|
—
|
|
||||||||
Balance, March 31, 2019
|
|
0.2
|
|
|
$
|
21
|
|
|
531
|
|
|
$
|
53
|
|
|
$
|
11,381
|
|
|
$
|
36
|
|
|
$
|
(4,559
|
)
|
|
$
|
6,932
|
|
|
|
For the Three Months Ended March 31,
|
||||||
(In millions)
|
|
2020
|
|
2019
|
||||
CASH FLOWS FROM OPERATING ACTIVITIES:
|
|
|
|
|
||||
Net income
|
|
$
|
74
|
|
|
$
|
320
|
|
Adjustments to reconcile net income to net cash from operating activities-
|
|
|
|
|
||||
Loss (gain) on disposal, net of tax (Note 3)
|
|
(50
|
)
|
|
24
|
|
||
Depreciation and amortization, including regulatory assets, net, and deferred debt-related costs
|
|
295
|
|
|
345
|
|
||
Deferred income taxes and investment tax credits, net
|
|
(78
|
)
|
|
91
|
|
||
Retirement benefits, net of payments
|
|
(66
|
)
|
|
(39
|
)
|
||
Pension trust contributions
|
|
—
|
|
|
(500
|
)
|
||
Pension and OPEB mark-to-market adjustment
|
|
423
|
|
|
—
|
|
||
Settlement agreement and tax sharing payments to the FES Debtors
|
|
(978
|
)
|
|
—
|
|
||
Changes in current assets and liabilities-
|
|
|
|
|
||||
Receivables
|
|
51
|
|
|
92
|
|
||
Prepaid taxes and other
|
|
(125
|
)
|
|
(148
|
)
|
||
Accounts payable
|
|
(66
|
)
|
|
(143
|
)
|
||
Accrued taxes
|
|
(37
|
)
|
|
(81
|
)
|
||
Accrued interest
|
|
29
|
|
|
13
|
|
||
Accrued compensation and benefits
|
|
(61
|
)
|
|
(123
|
)
|
||
Other current liabilities
|
|
1
|
|
|
(13
|
)
|
||
Other
|
|
28
|
|
|
(20
|
)
|
||
Net cash used for operating activities
|
|
(560
|
)
|
|
(182
|
)
|
||
|
|
|
|
|
||||
CASH FLOWS FROM FINANCING ACTIVITIES:
|
|
|
|
|
||||
New financing-
|
|
|
|
|
||||
Long-term debt
|
|
2,000
|
|
|
1,400
|
|
||
Short-term borrowings, net
|
|
—
|
|
|
50
|
|
||
Redemptions and repayments-
|
|
|
|
|
||||
Long-term debt
|
|
(778
|
)
|
|
(628
|
)
|
||
Short-term borrowings, net
|
|
(250
|
)
|
|
—
|
|
||
Preferred stock dividend payments
|
|
—
|
|
|
(3
|
)
|
||
Common stock dividend payments
|
|
(211
|
)
|
|
(201
|
)
|
||
Other
|
|
(36
|
)
|
|
(25
|
)
|
||
Net cash provided from financing activities
|
|
725
|
|
|
593
|
|
||
|
|
|
|
|
||||
CASH FLOWS FROM INVESTING ACTIVITIES:
|
|
|
|
|
||||
Property additions
|
|
(616
|
)
|
|
(554
|
)
|
||
Sales of investment securities held in trusts
|
|
13
|
|
|
153
|
|
||
Purchases of investment securities held in trusts
|
|
(18
|
)
|
|
(162
|
)
|
||
Asset removal costs
|
|
(43
|
)
|
|
(65
|
)
|
||
Other
|
|
5
|
|
|
(2
|
)
|
||
Net cash used for investing activities
|
|
(659
|
)
|
|
(630
|
)
|
||
|
|
|
|
|
||||
Net change in cash, cash equivalents, and restricted cash
|
|
(494
|
)
|
|
(219
|
)
|
||
Cash, cash equivalents, and restricted cash at beginning of period
|
|
679
|
|
|
429
|
|
||
Cash, cash equivalents, and restricted cash at end of period
|
|
$
|
185
|
|
|
$
|
210
|
|
|
|
For the Three Months Ended March 31, 2020
|
||||||||||||||
Revenues by Type of Service
|
|
Regulated Distribution
|
|
Regulated Transmission
|
|
Corporate/Other and Reconciling Adjustments (1)
|
|
Total
|
||||||||
|
|
(In millions)
|
||||||||||||||
Distribution services (2)
|
|
$
|
1,256
|
|
|
$
|
—
|
|
|
$
|
(21
|
)
|
|
$
|
1,235
|
|
Retail generation
|
|
904
|
|
|
—
|
|
|
(15
|
)
|
|
889
|
|
||||
Wholesale sales
|
|
71
|
|
|
—
|
|
|
1
|
|
|
72
|
|
||||
Transmission (2)
|
|
—
|
|
|
397
|
|
|
—
|
|
|
397
|
|
||||
Other
|
|
36
|
|
|
—
|
|
|
—
|
|
|
36
|
|
||||
Total revenues from contracts with customers
|
|
$
|
2,267
|
|
|
$
|
397
|
|
|
$
|
(35
|
)
|
|
$
|
2,629
|
|
ARP (3)
|
|
68
|
|
|
—
|
|
|
—
|
|
|
68
|
|
||||
Other non-customer revenue
|
|
23
|
|
|
4
|
|
|
(15
|
)
|
|
12
|
|
||||
Total revenues
|
|
$
|
2,358
|
|
|
$
|
401
|
|
|
$
|
(50
|
)
|
|
$
|
2,709
|
|
|
|
For the Three Months Ended March 31, 2019
|
||||||||||||||
Revenues by Type of Service
|
|
Regulated Distribution
|
|
Regulated Transmission
|
|
Corporate/Other and Reconciling Adjustments (1)
|
|
Total
|
||||||||
|
|
(In millions)
|
||||||||||||||
Distribution services (2)
|
|
$
|
1,286
|
|
|
$
|
—
|
|
|
$
|
(21
|
)
|
|
$
|
1,265
|
|
Retail generation
|
|
1,058
|
|
|
—
|
|
|
(14
|
)
|
|
1,044
|
|
||||
Wholesale sales
|
|
106
|
|
|
—
|
|
|
4
|
|
|
110
|
|
||||
Transmission (2)
|
|
—
|
|
|
352
|
|
|
—
|
|
|
352
|
|
||||
Other
|
|
34
|
|
|
—
|
|
|
1
|
|
|
35
|
|
||||
Total revenues from contracts with customers
|
|
$
|
2,484
|
|
|
$
|
352
|
|
|
$
|
(30
|
)
|
|
$
|
2,806
|
|
ARP (3)
|
|
62
|
|
|
—
|
|
|
—
|
|
|
62
|
|
||||
Other non-customer revenue
|
|
27
|
|
|
4
|
|
|
(16
|
)
|
|
15
|
|
||||
Total revenues
|
|
$
|
2,573
|
|
|
$
|
356
|
|
|
$
|
(46
|
)
|
|
$
|
2,883
|
|
|
|
For the Three Months Ended March 31,
|
||||||
Revenues by Customer Class
|
|
2020
|
|
2019
|
||||
|
|
(In millions)
|
||||||
Residential
|
|
$
|
1,319
|
|
|
$
|
1,484
|
|
Commercial
|
|
544
|
|
|
587
|
|
||
Industrial
|
|
277
|
|
|
249
|
|
||
Other
|
|
20
|
|
|
24
|
|
||
Total Revenues
|
|
$
|
2,160
|
|
|
$
|
2,344
|
|
|
|
For the Three Months Ended March 31,
|
||||||
Transmission Owner
|
|
2020
|
|
2019
|
||||
|
|
(In millions)
|
||||||
ATSI
|
|
$
|
204
|
|
|
$
|
174
|
|
TrAIL
|
|
63
|
|
|
58
|
|
||
MAIT
|
|
57
|
|
|
49
|
|
||
Other
|
|
73
|
|
|
71
|
|
||
Total Revenues
|
|
$
|
397
|
|
|
$
|
352
|
|
•
|
$500 million in borrowings by FES from FE under the secured credit facility;
|
•
|
$92 million in borrowings by the FES Debtors from FE under the unregulated companies’ money pool; and
|
•
|
$102 million outstanding unsecured promissory note by FES from AE Supply.
|
|
|
For the Three Months Ended March 31,
|
||||||
(In millions)
|
|
2020
|
|
2019
|
||||
|
|
|
|
|
||||
Revenues
|
|
$
|
7
|
|
|
$
|
54
|
|
Fuel
|
|
(6
|
)
|
|
(35
|
)
|
||
Other operating expenses
|
|
(6
|
)
|
|
(10
|
)
|
||
General taxes
|
|
—
|
|
|
(4
|
)
|
||
Other income (expense)
|
|
5
|
|
|
(2
|
)
|
||
Loss from discontinued operations, before tax
|
|
—
|
|
|
3
|
|
||
Income tax expense
|
|
—
|
|
|
14
|
|
||
Loss from discontinued operations, net of tax
|
|
—
|
|
|
(11
|
)
|
||
Gain (loss) on disposal of FES and FENOC, net of tax (1)
|
|
50
|
|
|
(24
|
)
|
||
Income (loss) from discontinued operations
|
|
$
|
50
|
|
|
$
|
(35
|
)
|
•
|
preferred stock dividends,
|
•
|
deemed dividends for the amortization of the beneficial conversion feature recognized at issuance of the preferred stock (if any), and
|
•
|
an allocation of undistributed earnings between the common stock and the participating securities (convertible preferred stock) based on their respective rights to receive dividends.
|
|
|
For the Three Months Ended March 31,
|
||||||
Reconciliation of Basic and Diluted EPS of Common Stock
|
|
2020
|
|
2019
|
||||
|
|
|
||||||
(In millions, except per share amounts)
|
|
|
|
|
||||
EPS of Common Stock
|
|
|
|
|
||||
Income from continuing operations
|
|
$
|
24
|
|
|
$
|
355
|
|
Less: Preferred dividends
|
|
—
|
|
|
(3
|
)
|
||
Less: Undistributed earnings allocated to preferred stockholders
|
|
—
|
|
|
(2
|
)
|
||
Income from continuing operations available to common stockholders
|
|
24
|
|
|
350
|
|
||
Discontinued operations, net of tax
|
|
50
|
|
|
(35
|
)
|
||
Less: Undistributed earnings allocated to preferred stockholders
|
|
—
|
|
|
—
|
|
||
Income (loss) from discontinued operations available to common stockholders
|
|
50
|
|
|
(35
|
)
|
||
|
|
|
|
|
||||
Income available to common stockholders, basic
|
|
$
|
74
|
|
|
$
|
315
|
|
|
|
|
|
|
||||
Share Count information:
|
|
|
|
|
||||
Weighted average number of basic shares outstanding
|
|
541
|
|
|
530
|
|
||
Assumed exercise of dilutive stock options and awards
|
|
2
|
|
|
3
|
|
||
Weighted average number of diluted shares outstanding
|
|
543
|
|
|
533
|
|
||
|
|
|
|
|
||||
Income available to common stockholders, per common share:
|
|
|
|
|
||||
Income from continuing operations, basic
|
|
$
|
0.05
|
|
|
$
|
0.66
|
|
Discontinued operations, basic
|
|
0.09
|
|
|
(0.07
|
)
|
||
Income available to common stockholders, basic
|
|
$
|
0.14
|
|
|
$
|
0.59
|
|
|
|
|
|
|
||||
Income from continuing operations, diluted
|
|
$
|
0.05
|
|
|
$
|
0.66
|
|
Discontinued operations, diluted
|
|
0.09
|
|
|
(0.07
|
)
|
||
Income available to common stockholders, diluted
|
|
$
|
0.14
|
|
|
$
|
0.59
|
|
Components of Net Periodic Benefit Costs (Credits)
|
|
Pension
|
OPEB
|
|||||||||||||
For the Three Months Ended March 31,
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
||||||||
|
|
(In millions)
|
||||||||||||||
Service costs
|
|
$
|
52
|
|
|
$
|
48
|
|
|
$
|
1
|
|
|
$
|
1
|
|
Interest costs
|
|
75
|
|
|
93
|
|
|
4
|
|
|
5
|
|
||||
Expected return on plan assets
|
|
(153
|
)
|
|
(135
|
)
|
|
(8
|
)
|
|
(7
|
)
|
||||
Amortization of prior service costs (credits) (1)
|
|
10
|
|
|
2
|
|
|
(33
|
)
|
|
(9
|
)
|
||||
Special termination costs (2)
|
|
—
|
|
|
15
|
|
|
—
|
|
|
—
|
|
||||
One-time termination benefit (3)
|
|
8
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Pension and OPEB mark-to-market adjustment
|
|
386
|
|
|
—
|
|
|
37
|
|
|
—
|
|
||||
Net periodic costs (credits), including amounts capitalized
|
|
$
|
378
|
|
|
$
|
23
|
|
|
$
|
1
|
|
|
$
|
(10
|
)
|
Net periodic costs (credits), recognized in earnings
|
|
$
|
358
|
|
|
$
|
6
|
|
|
$
|
1
|
|
|
$
|
(10
|
)
|
|
|
|
|
|
|
|
|
|
|
|
Gains & Losses on Cash Flow Hedges (1)
|
|
Defined Benefit Pension & OPEB Plans
|
|
Total
|
||||||
|
|
(In millions)
|
||||||||||
AOCI Balance, January 1, 2020
|
|
$
|
(9
|
)
|
|
$
|
29
|
|
|
$
|
20
|
|
|
|
|
|
|
|
|
||||||
Amounts reclassified from AOCI
|
|
—
|
|
|
(23
|
)
|
|
(23
|
)
|
|||
Other comprehensive loss
|
|
—
|
|
|
(23
|
)
|
|
(23
|
)
|
|||
Income tax benefits on other comprehensive loss
|
|
—
|
|
|
(5
|
)
|
|
(5
|
)
|
|||
Other comprehensive loss, net of tax
|
|
—
|
|
|
(18
|
)
|
|
(18
|
)
|
|||
|
|
|
|
|
|
|
||||||
AOCI Balance, March 31, 2020
|
|
$
|
(9
|
)
|
|
$
|
11
|
|
|
$
|
2
|
|
|
|
|
|
|
|
|
||||||
AOCI Balance, January 1, 2019
|
|
$
|
(11
|
)
|
|
$
|
52
|
|
|
$
|
41
|
|
|
|
|
|
|
|
|
||||||
Amounts reclassified from AOCI
|
|
1
|
|
|
(7
|
)
|
|
(6
|
)
|
|||
Other comprehensive income (loss)
|
|
1
|
|
|
(7
|
)
|
|
(6
|
)
|
|||
Income tax benefits on other comprehensive loss
|
|
—
|
|
|
(1
|
)
|
|
(1
|
)
|
|||
Other comprehensive income (loss), net of tax
|
|
1
|
|
|
(6
|
)
|
|
(5
|
)
|
|||
|
|
|
|
|
|
|
||||||
AOCI Balance, March 31, 2019
|
|
$
|
(10
|
)
|
|
$
|
46
|
|
|
$
|
36
|
|
|
|
|
|
|
|
|
Level 1
|
-
|
Quoted prices for identical instruments in active market
|
|
|
|
Level 2
|
-
|
Quoted prices for similar instruments in active market
|
|
-
|
Quoted prices for identical or similar instruments in markets that are not active
|
|
-
|
Model-derived valuations for which all significant inputs are observable market data
|
Level 3
|
-
|
Valuation inputs are unobservable and significant to the fair value measurement
|
|
March 31, 2020
|
|
December 31, 2019
|
||||||||||||||||||||||||||||
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||||||||||
Assets
|
(In millions)
|
||||||||||||||||||||||||||||||
Corporate debt securities
|
$
|
—
|
|
|
$
|
124
|
|
|
$
|
—
|
|
|
$
|
124
|
|
|
$
|
—
|
|
|
$
|
135
|
|
|
$
|
—
|
|
|
$
|
135
|
|
Derivative assets FTRs(1)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4
|
|
|
4
|
|
||||||||
Equity securities(2)
|
2
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|
2
|
|
|
—
|
|
|
—
|
|
|
2
|
|
||||||||
U.S. state debt securities
|
—
|
|
|
274
|
|
|
—
|
|
|
274
|
|
|
—
|
|
|
271
|
|
|
—
|
|
|
271
|
|
||||||||
Other(3)
|
166
|
|
|
802
|
|
|
—
|
|
|
968
|
|
|
627
|
|
|
789
|
|
|
—
|
|
|
1,416
|
|
||||||||
Total assets
|
$
|
168
|
|
|
$
|
1,200
|
|
|
$
|
—
|
|
|
$
|
1,368
|
|
|
$
|
629
|
|
|
$
|
1,195
|
|
|
$
|
4
|
|
|
$
|
1,828
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Derivative liabilities FTRs(1)
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(1
|
)
|
|
$
|
(1
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(1
|
)
|
|
$
|
(1
|
)
|
Derivative liabilities NUG contracts(1)
|
—
|
|
|
—
|
|
|
(6
|
)
|
|
(6
|
)
|
|
—
|
|
|
—
|
|
|
(16
|
)
|
|
(16
|
)
|
||||||||
Total liabilities
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(7
|
)
|
|
$
|
(7
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(17
|
)
|
|
$
|
(17
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net assets (liabilities)(4)
|
$
|
168
|
|
|
$
|
1,200
|
|
|
$
|
(7
|
)
|
|
$
|
1,361
|
|
|
$
|
629
|
|
|
$
|
1,195
|
|
|
$
|
(13
|
)
|
|
$
|
1,811
|
|
(1)
|
Contracts are subject to regulatory accounting treatment and changes in market values do not impact earnings.
|
(2)
|
NDT funds hold equity portfolios whose performance is benchmarked against the S&P 500 Low Volatility High Dividend Index, S&P 500 Index and MSCI AC World IMI Index.
|
(3)
|
Primarily consists of short-term cash investments.
|
(4)
|
Excludes $(18) million and $(16) million as of March 31, 2020 and December 31, 2019, respectively, of receivables, payables, taxes and accrued income associated with financial instruments reflected within the fair value table.
|
|
NUG Contracts(1)
|
|
FTRs(1)
|
||||||||||||||||||||
|
Derivative Assets
|
|
Derivative Liabilities
|
|
Net
|
|
Derivative Assets
|
|
Derivative Liabilities
|
|
Net
|
||||||||||||
|
(In millions)
|
||||||||||||||||||||||
January 1, 2019 Balance
|
$
|
—
|
|
|
$
|
(44
|
)
|
|
$
|
(44
|
)
|
|
$
|
10
|
|
|
$
|
(1
|
)
|
|
$
|
9
|
|
Unrealized gain
|
—
|
|
|
(11
|
)
|
|
(11
|
)
|
|
(1
|
)
|
|
—
|
|
|
(1
|
)
|
||||||
Purchases
|
—
|
|
|
—
|
|
|
—
|
|
|
6
|
|
|
(4
|
)
|
|
2
|
|
||||||
Settlements
|
—
|
|
|
39
|
|
|
39
|
|
|
(11
|
)
|
|
4
|
|
|
(7
|
)
|
||||||
December 31, 2019 Balance
|
$
|
—
|
|
|
$
|
(16
|
)
|
|
$
|
(16
|
)
|
|
$
|
4
|
|
|
$
|
(1
|
)
|
|
$
|
3
|
|
Unrealized loss
|
—
|
|
|
(3
|
)
|
|
(3
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Purchases
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Settlements
|
—
|
|
|
13
|
|
|
13
|
|
|
(4
|
)
|
|
—
|
|
|
(4
|
)
|
||||||
March 31, 2020 Balance
|
$
|
—
|
|
|
$
|
(6
|
)
|
|
$
|
(6
|
)
|
|
$
|
—
|
|
|
$
|
(1
|
)
|
|
$
|
(1
|
)
|
(1)
|
Contracts are subject to regulatory accounting treatment and changes in market values do not impact earnings.
|
|
|
Fair Value, Net (In millions)
|
|
Valuation
Technique |
|
Significant Input
|
|
Range
|
|
Weighted Average
|
|
Units
|
|||
FTRs
|
|
$
|
(1
|
)
|
|
Model
|
|
RTO auction clearing prices
|
|
$(0.10) to $2.10
|
|
$0.50
|
|
Dollars/MWH
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
NUG Contracts
|
|
$
|
(6
|
)
|
|
Model
|
|
Generation
|
|
400 to 109,000
|
|
27,000
|
|
|
MWH
|
|
|
|
Regional electricity prices
|
|
$20.50 to $34.70
|
|
$21.60
|
|
Dollars/MWH
|
|
|
March 31, 2020(1)
|
|
December 31, 2019(2)
|
||||||||||||||||||||||||||||
|
|
Cost Basis
|
|
Unrealized Gains
|
|
Unrealized Losses
|
|
Fair Value (3)
|
|
Cost Basis
|
|
Unrealized Gains
|
|
Unrealized Losses
|
|
Fair Value (3)
|
||||||||||||||||
|
|
(In millions)
|
||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Debt securities
|
|
$
|
405
|
|
|
$
|
8
|
|
|
$
|
(16
|
)
|
|
$
|
397
|
|
|
$
|
403
|
|
|
$
|
9
|
|
|
$
|
(11
|
)
|
|
$
|
401
|
|
|
|
For the Three Months Ended March 31,
|
|
||||||
|
|
2020
|
|
2019
|
|
||||
|
|
(In millions)
|
|
||||||
Sale proceeds
|
|
$
|
13
|
|
|
$
|
153
|
|
|
Realized gains
|
|
4
|
|
|
7
|
|
|
||
Realized losses
|
|
(5
|
)
|
|
(6
|
)
|
|
||
Interest and dividend income
|
|
5
|
|
|
9
|
|
|
|
March 31, 2020
|
|
December 31, 2019
|
||||
|
(In millions)
|
||||||
Carrying value (1)
|
$
|
21,297
|
|
|
$
|
20,074
|
|
Fair value
|
$
|
23,576
|
|
|
$
|
22,928
|
|
Potential Collateral Obligations
|
|
|
Utilities and FET
|
|
FE
|
|
Total
|
||||||
|
|
(In millions)
|
|||||||||||
Contractual Obligations for Additional Collateral
|
|
|
|
|
|
|
|
||||||
Upon Further Downgrade
|
|
|
$
|
33
|
|
|
$
|
—
|
|
|
$
|
33
|
|
Surety Bonds (Collateralized Amount) (1)
|
|
|
63
|
|
|
257
|
|
|
320
|
|
|||
Total Exposure from Contractual Obligations
|
|
|
$
|
96
|
|
|
$
|
257
|
|
|
$
|
353
|
|
(1)
|
Surety Bonds are not tied to a credit rating. Surety Bonds’ impact assumes maximum contractual obligations (typical obligations require 30 days to cure).
|
For the Three Months Ended
|
|
Regulated Distribution
|
|
Regulated Transmission
|
|
Corporate/ Other
|
|
Reconciling Adjustments
|
|
FirstEnergy Consolidated
|
||||||||||
|
|
(In millions)
|
||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
March 31, 2020
|
|
|
|
|
|
|
|
|
|
|
||||||||||
External revenues
|
|
$
|
2,311
|
|
|
$
|
397
|
|
|
$
|
1
|
|
|
$
|
—
|
|
|
$
|
2,709
|
|
Internal revenues
|
|
47
|
|
|
4
|
|
|
—
|
|
|
(51
|
)
|
|
—
|
|
|||||
Total revenues
|
|
$
|
2,358
|
|
|
$
|
401
|
|
|
$
|
1
|
|
|
$
|
(51
|
)
|
|
$
|
2,709
|
|
Depreciation
|
|
223
|
|
|
76
|
|
|
2
|
|
|
16
|
|
|
317
|
|
|||||
Amortization of regulatory assets, net
|
|
49
|
|
|
3
|
|
|
—
|
|
|
—
|
|
|
52
|
|
|||||
Miscellaneous income (expense), net
|
|
75
|
|
|
6
|
|
|
25
|
|
|
(6
|
)
|
|
100
|
|
|||||
Interest expense
|
|
127
|
|
|
52
|
|
|
90
|
|
|
(6
|
)
|
|
263
|
|
|||||
Income taxes (benefits)
|
|
(32
|
)
|
|
34
|
|
|
(62
|
)
|
|
—
|
|
|
(60
|
)
|
|||||
Income (loss) from continuing operations
|
|
136
|
|
|
117
|
|
|
(229
|
)
|
|
—
|
|
|
24
|
|
|||||
Property additions
|
|
$
|
338
|
|
|
$
|
269
|
|
|
$
|
9
|
|
|
$
|
—
|
|
|
$
|
616
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
March 31, 2019
|
|
|
|
|
|
|
|
|
|
|
||||||||||
External revenues
|
|
$
|
2,526
|
|
|
$
|
352
|
|
|
$
|
5
|
|
|
$
|
—
|
|
|
$
|
2,883
|
|
Internal revenues
|
|
47
|
|
|
4
|
|
|
—
|
|
|
(51
|
)
|
|
—
|
|
|||||
Total revenues
|
|
$
|
2,573
|
|
|
$
|
356
|
|
|
$
|
5
|
|
|
$
|
(51
|
)
|
|
$
|
2,883
|
|
Depreciation
|
|
209
|
|
|
69
|
|
|
2
|
|
|
17
|
|
|
297
|
|
|||||
Amortization of regulatory assets, net
|
|
3
|
|
|
2
|
|
|
—
|
|
|
—
|
|
|
5
|
|
|||||
Miscellaneous income (expense), net
|
|
46
|
|
|
4
|
|
|
11
|
|
|
(7
|
)
|
|
54
|
|
|||||
Interest expense
|
|
122
|
|
|
45
|
|
|
93
|
|
|
(7
|
)
|
|
253
|
|
|||||
Income taxes (benefits)
|
|
89
|
|
|
31
|
|
|
(27
|
)
|
|
—
|
|
|
93
|
|
|||||
Income (loss) from continuing operations
|
|
329
|
|
|
104
|
|
|
(78
|
)
|
|
—
|
|
|
355
|
|
|||||
Property additions
|
|
$
|
318
|
|
|
$
|
231
|
|
|
$
|
5
|
|
|
$
|
—
|
|
|
$
|
554
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
As of March 31, 2020
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Total assets
|
|
$
|
29,642
|
|
|
$
|
11,753
|
|
|
$
|
695
|
|
|
$
|
—
|
|
|
$
|
42,090
|
|
Total goodwill
|
|
$
|
5,004
|
|
|
$
|
614
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
5,618
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
As of December 31, 2019
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Total assets
|
|
$
|
29,642
|
|
|
$
|
11,611
|
|
|
$
|
1,015
|
|
|
$
|
33
|
|
|
$
|
42,301
|
|
Total goodwill
|
|
$
|
5,004
|
|
|
$
|
614
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
5,618
|
|
•
|
Implemented forward-looking rates, subject to refund, at JCP&L effective January 1, 2020,
|
•
|
OH Decoupling rider went into effect on February 1, 2020,
|
•
|
JCP&L submitted a filing with the NJBPU on February 18, 2020, requesting a distribution base rate increase of $186.9 million on an annual basis,
|
•
|
PAPUC-approved Penn DSIC waiver on March 12, 2020,
|
•
|
Completed final step of FirstEnergy’s strategy to exit the competitive generation business with FES Debtors’ emergence on February 27, 2020, and
|
•
|
IRP filing in West Virginia to be made by December 30, 2020.
|
(In millions)
|
|
For the Three Months Ended March 31,
|
|||||||||||||
|
|
2020
|
|
2019
|
|
Change
|
|||||||||
|
|
|
|
|
|
|
|
|
|||||||
Revenues
|
|
$
|
2,709
|
|
|
$
|
2,883
|
|
|
$
|
(174
|
)
|
|
(6
|
)%
|
|
|
|
|
|
|
|
|
|
|||||||
Operating expenses
|
|
2,177
|
|
|
2,254
|
|
|
(77
|
)
|
|
(3
|
)%
|
|||
|
|
|
|
|
|
|
|
|
|||||||
Operating income
|
|
532
|
|
|
629
|
|
|
(97
|
)
|
|
(15
|
)%
|
|||
|
|
|
|
|
|
|
|
|
|||||||
Other expenses, net
|
|
(568
|
)
|
|
(181
|
)
|
|
(387
|
)
|
|
(214
|
)%
|
|||
|
|
|
|
|
|
|
|
|
|||||||
Income before income taxes
|
|
(36
|
)
|
|
448
|
|
|
(484
|
)
|
|
(108
|
)%
|
|||
|
|
|
|
|
|
|
|
|
|||||||
Income taxes
|
|
(60
|
)
|
|
93
|
|
|
(153
|
)
|
|
(165
|
)%
|
|||
|
|
|
|
|
|
|
|
|
|||||||
Income from continuing operations
|
|
24
|
|
|
355
|
|
|
(331
|
)
|
|
(93
|
)%
|
|||
|
|
|
|
|
|
|
|
|
|||||||
Discontinued operations, net of tax
|
|
50
|
|
|
(35
|
)
|
|
85
|
|
|
NM
|
|
|||
|
|
|
|
|
|
|
|
|
|||||||
Net income
|
|
$
|
74
|
|
|
$
|
320
|
|
|
$
|
(246
|
)
|
|
(77
|
)%
|
|
|
|
|
|
|
|
|
|
First Quarter 2020 Financial Results
|
|
Regulated Distribution
|
|
Regulated Transmission
|
|
Corporate/Other and Reconciling Adjustments
|
|
FirstEnergy Consolidated
|
||||||||
|
|
(In millions)
|
||||||||||||||
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Electric
|
|
$
|
2,299
|
|
|
$
|
397
|
|
|
$
|
(35
|
)
|
|
$
|
2,661
|
|
Other
|
|
59
|
|
|
4
|
|
|
(15
|
)
|
|
48
|
|
||||
Total Revenues
|
|
2,358
|
|
|
401
|
|
|
(50
|
)
|
|
2,709
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Operating Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Fuel
|
|
98
|
|
|
—
|
|
|
—
|
|
|
98
|
|
||||
Purchased power
|
|
690
|
|
|
—
|
|
|
4
|
|
|
694
|
|
||||
Other operating expenses
|
|
699
|
|
|
53
|
|
|
(3
|
)
|
|
749
|
|
||||
Provision for depreciation
|
|
223
|
|
|
76
|
|
|
18
|
|
|
317
|
|
||||
Amortization of regulatory assets, net
|
|
49
|
|
|
3
|
|
|
—
|
|
|
52
|
|
||||
General taxes
|
|
195
|
|
|
62
|
|
|
10
|
|
|
267
|
|
||||
Total Operating Expenses
|
|
1,954
|
|
|
194
|
|
|
29
|
|
|
2,177
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Operating Income (Loss)
|
|
404
|
|
|
207
|
|
|
(79
|
)
|
|
532
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Other Income (Expense):
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Miscellaneous income, net
|
|
75
|
|
|
6
|
|
|
19
|
|
|
100
|
|
||||
Pension and OPEB mark-to-market adjustment
|
|
(257
|
)
|
|
(19
|
)
|
|
(147
|
)
|
|
(423
|
)
|
||||
Interest expense
|
|
(127
|
)
|
|
(52
|
)
|
|
(84
|
)
|
|
(263
|
)
|
||||
Capitalized financing costs
|
|
9
|
|
|
9
|
|
|
—
|
|
|
18
|
|
||||
Total Other Expense
|
|
(300
|
)
|
|
(56
|
)
|
|
(212
|
)
|
|
(568
|
)
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Income (Loss) Before Income Taxes (Benefits)
|
|
104
|
|
|
151
|
|
|
(291
|
)
|
|
(36
|
)
|
||||
Income taxes (benefits)
|
|
(32
|
)
|
|
34
|
|
|
(62
|
)
|
|
(60
|
)
|
||||
Income (Loss) From Continuing Operations
|
|
136
|
|
|
117
|
|
|
(229
|
)
|
|
24
|
|
||||
Discontinued operations, net of tax
|
|
—
|
|
|
—
|
|
|
50
|
|
|
50
|
|
||||
Net Income (Loss)
|
|
$
|
136
|
|
|
$
|
117
|
|
|
$
|
(179
|
)
|
|
$
|
74
|
|
First Quarter 2019 Financial Results
|
|
Regulated Distribution
|
|
Regulated Transmission
|
|
Corporate/Other and Reconciling Adjustments
|
|
FirstEnergy Consolidated
|
||||||||
|
|
(In millions)
|
||||||||||||||
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Electric
|
|
$
|
2,512
|
|
|
$
|
352
|
|
|
$
|
(31
|
)
|
|
$
|
2,833
|
|
Other
|
|
61
|
|
|
4
|
|
|
(15
|
)
|
|
50
|
|
||||
Total Revenues
|
|
2,573
|
|
|
356
|
|
|
(46
|
)
|
|
2,883
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Operating Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Fuel
|
|
131
|
|
|
—
|
|
|
—
|
|
|
131
|
|
||||
Purchased power
|
|
777
|
|
|
—
|
|
|
4
|
|
|
781
|
|
||||
Other operating expenses
|
|
771
|
|
|
66
|
|
|
(58
|
)
|
|
779
|
|
||||
Provision for depreciation
|
|
209
|
|
|
69
|
|
|
19
|
|
|
297
|
|
||||
Amortization of regulatory assets, net
|
|
3
|
|
|
2
|
|
|
—
|
|
|
5
|
|
||||
General taxes
|
|
198
|
|
|
51
|
|
|
12
|
|
|
261
|
|
||||
Total Operating Expenses
|
|
2,089
|
|
|
188
|
|
|
(23
|
)
|
|
2,254
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Operating Income (Loss)
|
|
484
|
|
|
168
|
|
|
(23
|
)
|
|
629
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Other Income (Expense):
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Miscellaneous income, net
|
|
46
|
|
|
4
|
|
|
4
|
|
|
54
|
|
||||
Pension and OPEB mark-to-market adjustment
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Interest expense
|
|
(122
|
)
|
|
(45
|
)
|
|
(86
|
)
|
|
(253
|
)
|
||||
Capitalized financing costs
|
|
10
|
|
|
8
|
|
|
—
|
|
|
18
|
|
||||
Total Other Expense
|
|
(66
|
)
|
|
(33
|
)
|
|
(82
|
)
|
|
(181
|
)
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Income (Loss) Before Income Taxes (Benefits)
|
|
418
|
|
|
135
|
|
|
(105
|
)
|
|
448
|
|
||||
Income taxes (benefits)
|
|
89
|
|
|
31
|
|
|
(27
|
)
|
|
93
|
|
||||
Income (Loss) From Continuing Operations
|
|
329
|
|
|
104
|
|
|
(78
|
)
|
|
355
|
|
||||
Discontinued operations, net of tax
|
|
—
|
|
|
—
|
|
|
(35
|
)
|
|
(35
|
)
|
||||
Net Income (Loss)
|
|
$
|
329
|
|
|
$
|
104
|
|
|
$
|
(113
|
)
|
|
$
|
320
|
|
Changes Between First Quarter 2020 and First Quarter 2019 Financial Results
|
|
Regulated Distribution
|
|
Regulated Transmission
|
|
Corporate/Other and Reconciling Adjustments
|
|
FirstEnergy Consolidated
|
||||||||
|
|
(In millions)
|
||||||||||||||
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Electric
|
|
$
|
(213
|
)
|
|
$
|
45
|
|
|
$
|
(4
|
)
|
|
$
|
(172
|
)
|
Other
|
|
(2
|
)
|
|
—
|
|
|
—
|
|
|
(2
|
)
|
||||
Total Revenues
|
|
(215
|
)
|
|
45
|
|
|
(4
|
)
|
|
(174
|
)
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Operating Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Fuel
|
|
(33
|
)
|
|
—
|
|
|
—
|
|
|
(33
|
)
|
||||
Purchased power
|
|
(87
|
)
|
|
—
|
|
|
—
|
|
|
(87
|
)
|
||||
Other operating expenses
|
|
(72
|
)
|
|
(13
|
)
|
|
55
|
|
|
(30
|
)
|
||||
Provision for depreciation
|
|
14
|
|
|
7
|
|
|
(1
|
)
|
|
20
|
|
||||
Amortization of regulatory assets, net
|
|
46
|
|
|
1
|
|
|
—
|
|
|
47
|
|
||||
General taxes
|
|
(3
|
)
|
|
11
|
|
|
(2
|
)
|
|
6
|
|
||||
Total Operating Expenses
|
|
(135
|
)
|
|
6
|
|
|
52
|
|
|
(77
|
)
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Operating Income (Loss)
|
|
(80
|
)
|
|
39
|
|
|
(56
|
)
|
|
(97
|
)
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Other Income (Expense):
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Miscellaneous income, net
|
|
29
|
|
|
2
|
|
|
15
|
|
|
46
|
|
||||
Pension and OPEB mark-to-market adjustment
|
|
(257
|
)
|
|
(19
|
)
|
|
(147
|
)
|
|
(423
|
)
|
||||
Interest expense
|
|
(5
|
)
|
|
(7
|
)
|
|
2
|
|
|
(10
|
)
|
||||
Capitalized financing costs
|
|
(1
|
)
|
|
1
|
|
|
—
|
|
|
—
|
|
||||
Total Other Expense
|
|
(234
|
)
|
|
(23
|
)
|
|
(130
|
)
|
|
(387
|
)
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Income (Loss) Before Income Taxes (Benefits)
|
|
(314
|
)
|
|
16
|
|
|
(186
|
)
|
|
(484
|
)
|
||||
Income taxes (benefits)
|
|
(121
|
)
|
|
3
|
|
|
(35
|
)
|
|
(153
|
)
|
||||
Income (Loss) From Continuing Operations
|
|
(193
|
)
|
|
13
|
|
|
(151
|
)
|
|
(331
|
)
|
||||
Discontinued operations, net of tax
|
|
—
|
|
|
—
|
|
|
85
|
|
|
85
|
|
||||
Net Income (Loss)
|
|
$
|
(193
|
)
|
|
$
|
13
|
|
|
$
|
(66
|
)
|
|
$
|
(246
|
)
|
|
|
For the Three Months Ended March 31,
|
|
|
||||||||
Revenues by Type of Service
|
|
2020
|
|
2019
|
|
(Decrease)
|
||||||
|
|
(In millions)
|
||||||||||
Distribution(1)
|
|
$
|
1,324
|
|
|
$
|
1,348
|
|
|
$
|
(24
|
)
|
|
|
|
|
|
|
|
||||||
Generation sales:
|
|
|
|
|
|
|
||||||
Retail
|
|
904
|
|
|
1,058
|
|
|
(154
|
)
|
|||
Wholesale
|
|
71
|
|
|
106
|
|
|
(35
|
)
|
|||
Total generation sales
|
|
975
|
|
|
1,164
|
|
|
(189
|
)
|
|||
|
|
|
|
|
|
|
||||||
Other
|
|
59
|
|
|
61
|
|
|
(2
|
)
|
|||
Total Revenues
|
|
$
|
2,358
|
|
|
$
|
2,573
|
|
|
$
|
(215
|
)
|
|
|
For the Three Months Ended March 31,
|
||||||||||||||||
(In thousands)
|
|
Including Ohio Decoupled MWH
|
|
Excluding Ohio Decoupled MWH
|
||||||||||||||
Electric Distribution MWH
|
|
2020
|
|
2019
|
|
(Decrease)
|
|
2020
|
|
2019
|
|
(Decrease)
|
||||||
Residential
|
|
13,204
|
|
|
15,103
|
|
|
(12.6
|
)%
|
|
8,996
|
|
|
10,404
|
|
|
(13.5
|
)%
|
Commercial
|
|
8,766
|
|
|
9,478
|
|
|
(7.5
|
)%
|
|
5,396
|
|
|
5,886
|
|
|
(8.3
|
)%
|
Industrial
|
|
13,548
|
|
|
13,960
|
|
|
(3.0
|
)%
|
|
13,548
|
|
|
13,960
|
|
|
(3.0
|
)%
|
Other
|
|
135
|
|
|
140
|
|
|
(3.6
|
)%
|
|
135
|
|
|
140
|
|
|
(3.6
|
)%
|
Total Electric Distribution MWH
|
|
35,653
|
|
|
38,681
|
|
|
(7.8
|
)%
|
|
28,075
|
|
|
30,390
|
|
|
(7.6
|
)%
|
Source of Change in Generation Revenues
|
|
(Decrease)
|
||
|
|
(In millions)
|
||
Retail:
|
|
|
|
|
Change in sales volumes
|
|
$
|
(133
|
)
|
Change in prices
|
|
(21
|
)
|
|
|
|
(154
|
)
|
|
Wholesale:
|
|
|
||
Change in sales volumes
|
|
(6
|
)
|
|
Change in prices
|
|
(8
|
)
|
|
Capacity revenue
|
|
(21
|
)
|
|
|
|
(35
|
)
|
|
Decrease in Generation Revenues
|
|
$
|
(189
|
)
|
•
|
Fuel expense decreased $33 million in the first quarter of 2020, as compared to the same period of 2019, primarily due to lower unit costs and lower generation output.
|
•
|
Purchased power costs were $87 million lower in the first quarter of 2020, as compared to the same period in 2019, primarily due to decreased volumes as described above and lower capacity expense, partially offset by the implementation of the NJ Zero Emission Program in June 2019.
|
Source of Change in Purchased Power
|
|
Increase (Decrease)
|
|||
|
|
(In millions)
|
|||
Purchases
|
|
|
|||
Change due to unit costs
|
|
9
|
|
||
Change due to volumes
|
|
(70
|
)
|
||
|
|
(61
|
)
|
||
Capacity expense
|
|
(26
|
)
|
||
Decrease in Purchased Power Costs
|
|
$
|
(87
|
)
|
•
|
Other operating expenses decreased $72 million in the first quarter of 2020, as compared to the same period of 2019, primarily due to the following:
|
•
|
Decreased storm restoration costs of $100 million, which were mostly deferred for future recovery, resulting in no material impact on current period earnings.
|
•
|
Higher network transmission expenses of $10 million. These costs are deferred for future recovery, resulting in no material impact on current period earnings.
|
•
|
Higher operating and maintenance expense of $13 million, primarily associated with higher labor, employee benefit costs and contractor and maintenance spend, partially offset by lower corporate support costs.
|
•
|
Higher pension and OPEB service costs of $5 million.
|
•
|
Depreciation expense increased $14 million in the first quarter of 2020, as compared to the same period of 2019, primarily due to a higher asset base.
|
•
|
Amortization expense increased $46 million in the first quarter of 2020, as compared to the same period of 2019, primarily due to lower storm restoration cost deferrals, partially offset by higher generation and transmission deferrals.
|
|
|
For the Three Months Ended March 31,
|
|
|
||||||||
Revenues by Transmission Asset Owner
|
|
2020
|
|
2019
|
|
Increase
|
||||||
|
|
(In millions)
|
||||||||||
ATSI
|
|
$
|
205
|
|
|
$
|
175
|
|
|
$
|
30
|
|
TrAIL
|
|
65
|
|
|
60
|
|
|
5
|
|
|||
MAIT
|
|
58
|
|
|
50
|
|
|
8
|
|
|||
Other
|
|
73
|
|
|
71
|
|
|
2
|
|
|||
Total Revenues
|
|
$
|
401
|
|
|
$
|
356
|
|
|
$
|
45
|
|
Net Regulatory Assets (Liabilities) by Source
|
|
March 31,
2020 |
|
December 31,
2019 |
|
Change
|
||||||
|
|
(In millions)
|
||||||||||
Regulatory transition costs
|
|
$
|
(10
|
)
|
|
$
|
(8
|
)
|
|
$
|
(2
|
)
|
Customer payables for future income taxes
|
|
(2,558
|
)
|
|
(2,605
|
)
|
|
47
|
|
|||
Nuclear decommissioning and spent fuel disposal costs
|
|
(189
|
)
|
|
(197
|
)
|
|
8
|
|
|||
Asset removal costs
|
|
(740
|
)
|
|
(756
|
)
|
|
16
|
|
|||
Deferred transmission costs
|
|
298
|
|
|
298
|
|
|
—
|
|
|||
Deferred generation costs
|
|
195
|
|
|
214
|
|
|
(19
|
)
|
|||
Deferred distribution costs
|
|
208
|
|
|
155
|
|
|
53
|
|
|||
Contract valuations
|
|
43
|
|
|
51
|
|
|
(8
|
)
|
|||
Storm-related costs
|
|
537
|
|
|
551
|
|
|
(14
|
)
|
|||
Other
|
|
41
|
|
|
36
|
|
|
5
|
|
|||
Net Regulatory Liabilities included on the Consolidated Balance Sheets
|
|
$
|
(2,175
|
)
|
|
$
|
(2,261
|
)
|
|
$
|
86
|
|
Regulatory Assets by Source Not Earning a Current Return
|
|
March 31,
2020 |
|
December 31,
2019 |
|
Change
|
||||||
|
|
(In millions)
|
||||||||||
Regulatory transition costs
|
|
$
|
9
|
|
|
$
|
7
|
|
|
$
|
2
|
|
Deferred transmission costs
|
|
26
|
|
|
27
|
|
|
(1
|
)
|
|||
Deferred generation costs
|
|
11
|
|
|
15
|
|
|
(4
|
)
|
|||
Storm-related costs
|
|
467
|
|
|
471
|
|
|
(4
|
)
|
|||
Other
|
|
25
|
|
|
25
|
|
|
—
|
|
|||
Regulatory Assets Not Earning a Current Return
|
|
$
|
538
|
|
|
$
|
545
|
|
|
$
|
(7
|
)
|
Currently Payable Long-Term Debt
|
|
(In millions)
|
||
Unsecured notes
|
|
$
|
250
|
|
Secured notes
|
|
50
|
|
|
Sinking fund requirements
|
|
65
|
|
|
Other notes
|
|
16
|
|
|
|
|
$
|
381
|
|
Borrower(s)
|
|
Type
|
|
Maturity
|
|
Commitment
|
|
Available Liquidity
|
||||
|
|
|
|
|
|
(In millions)
|
||||||
FirstEnergy(1)
|
|
Revolving
|
|
December 2022
|
|
$
|
2,500
|
|
|
$
|
2,496
|
|
FET(2)
|
|
Revolving
|
|
December 2022
|
|
1,000
|
|
|
825
|
|
||
|
|
|
|
Subtotal
|
|
$
|
3,500
|
|
|
$
|
3,321
|
|
|
|
Cash and cash equivalents
|
|
—
|
|
|
212
|
|
||||
|
|
|
|
Total
|
|
$
|
3,500
|
|
|
$
|
3,533
|
|
(1)
|
FE and the Utilities. Available liquidity includes impact of $4 million of LOCs issued under various terms.
|
(2)
|
Includes FET and the Transmission Companies.
|
Borrower
|
|
FirstEnergy Revolving
Credit Facility
Sub-Limit
|
|
FET Revolving
Credit Facility
Sub-Limit
|
|
Regulatory and
Other Short-Term Debt Limitations
|
|
|
|||||||||
|
|
(In millions)
|
|
|
|||||||||||||
FE
|
|
|
$
|
2,500
|
|
|
|
$
|
—
|
|
|
|
$
|
—
|
|
(1)
|
|
FET
|
|
|
—
|
|
|
|
1,000
|
|
|
|
—
|
|
(1)
|
|
|||
OE
|
|
|
500
|
|
|
|
—
|
|
|
|
500
|
|
(2)
|
|
|||
CEI
|
|
|
500
|
|
|
|
—
|
|
|
|
500
|
|
(2)
|
|
|||
TE
|
|
|
300
|
|
|
|
—
|
|
|
|
300
|
|
(2)
|
|
|||
JCP&L
|
|
|
500
|
|
|
|
—
|
|
|
|
500
|
|
(2)
|
|
|||
ME
|
|
|
500
|
|
|
|
—
|
|
|
|
500
|
|
(2)
|
|
|||
PN
|
|
|
300
|
|
|
|
—
|
|
|
|
300
|
|
(2)
|
|
|||
WP
|
|
|
200
|
|
|
|
—
|
|
|
|
200
|
|
(2)
|
|
|||
MP
|
|
|
500
|
|
|
|
—
|
|
|
|
500
|
|
(2)
|
|
|||
PE
|
|
|
150
|
|
|
|
—
|
|
|
|
150
|
|
(2)
|
|
|||
ATSI
|
|
|
—
|
|
|
|
500
|
|
|
|
500
|
|
(2)
|
|
|||
Penn
|
|
|
100
|
|
|
|
—
|
|
|
|
100
|
|
(2)
|
|
|||
TrAIL
|
|
|
—
|
|
|
|
400
|
|
|
|
400
|
|
(2)
|
|
|||
MAIT
|
|
|
—
|
|
|
|
400
|
|
|
|
400
|
|
(2)
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
No limitations.
|
(2)
|
Includes amounts which may be borrowed under the regulated companies’ money pool.
|
|
|
Corporate Credit Rating
|
|
Senior Secured
|
|
Senior Unsecured
|
|
Outlook (1)
|
||||||||||||||||
Issuer
|
|
S&P
|
|
Moody’s
|
|
Fitch
|
|
S&P
|
|
Moody’s
|
|
Fitch
|
|
S&P
|
|
Moody’s
|
|
Fitch
|
|
S&P
|
|
Moody’s
|
|
Fitch
|
FE
|
|
BBB
|
|
Baa3
|
|
BBB
|
|
—
|
|
—
|
|
—
|
|
BBB-
|
|
Baa3
|
|
BBB
|
|
S
|
|
S
|
|
S
|
AGC
|
|
BBB-
|
|
Baa2
|
|
BBB
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
S
|
|
S
|
|
S
|
ATSI
|
|
BBB
|
|
A3
|
|
BBB+
|
|
—
|
|
—
|
|
—
|
|
BBB
|
|
A3
|
|
A-
|
|
S
|
|
S
|
|
S
|
CEI
|
|
BBB
|
|
Baa2
|
|
BBB+
|
|
A-
|
|
A3
|
|
A
|
|
BBB
|
|
Baa2
|
|
A-
|
|
S
|
|
S
|
|
S
|
FET
|
|
BBB
|
|
Baa2
|
|
BBB
|
|
—
|
|
—
|
|
—
|
|
BBB-
|
|
Baa2
|
|
BBB
|
|
S
|
|
S
|
|
S
|
JCP&L
|
|
BBB
|
|
Baa1
|
|
BBB+
|
|
—
|
|
—
|
|
—
|
|
BBB
|
|
Baa1
|
|
A-
|
|
S
|
|
RUR+
|
|
S
|
ME
|
|
BBB
|
|
A3
|
|
BBB+
|
|
—
|
|
—
|
|
—
|
|
BBB
|
|
A3
|
|
A-
|
|
S
|
|
S
|
|
S
|
MAIT
|
|
BBB
|
|
A3
|
|
BBB+
|
|
—
|
|
—
|
|
—
|
|
BBB
|
|
A3
|
|
A-
|
|
S
|
|
S
|
|
S
|
MP
|
|
BBB
|
|
Baa2
|
|
BBB
|
|
A-
|
|
A3
|
|
A-
|
|
BBB
|
|
Baa2
|
|
—
|
|
S
|
|
S
|
|
S
|
OE
|
|
BBB
|
|
A3
|
|
BBB+
|
|
A-
|
|
A1
|
|
A
|
|
BBB
|
|
A3
|
|
A-
|
|
S
|
|
P
|
|
S
|
PN
|
|
BBB
|
|
Baa1
|
|
BBB+
|
|
—
|
|
—
|
|
—
|
|
BBB
|
|
Baa1
|
|
A-
|
|
S
|
|
S
|
|
S
|
Penn
|
|
BBB
|
|
A3
|
|
BBB+
|
|
—
|
|
A1
|
|
A
|
|
—
|
|
—
|
|
—
|
|
S
|
|
P
|
|
S
|
PE
|
|
BBB
|
|
Baa2
|
|
BBB
|
|
—
|
|
—
|
|
A-
|
|
—
|
|
—
|
|
—
|
|
S
|
|
S
|
|
S
|
TE
|
|
BBB
|
|
Baa1
|
|
BBB+
|
|
A-
|
|
A2
|
|
A
|
|
—
|
|
—
|
|
—
|
|
S
|
|
S
|
|
S
|
TrAIL
|
|
BBB
|
|
A3
|
|
BBB+
|
|
—
|
|
—
|
|
—
|
|
BBB
|
|
A3
|
|
A-
|
|
S
|
|
S
|
|
S
|
WP
|
|
BBB
|
|
A3
|
|
BBB+
|
|
—
|
|
—
|
|
A
|
|
—
|
|
—
|
|
—
|
|
S
|
|
S
|
|
S
|
|
|
For the Three Months Ended March 31,
|
||||||
Securities Issued or Redeemed / Repaid
|
|
2020
|
|
2019
|
||||
|
|
(In millions)
|
||||||
|
|
|
|
|
||||
New Issues - Unsecured notes
|
|
$
|
2,000
|
|
|
$
|
1,400
|
|
|
|
|
|
|
||||
Redemptions / Repayments
|
|
|
|
|
|
|
||
Unsecured notes
|
|
$
|
—
|
|
|
$
|
(600
|
)
|
Term loan
|
|
(750
|
)
|
|
—
|
|
||
Senior secured notes
|
|
(28
|
)
|
|
(28
|
)
|
||
|
|
$
|
(778
|
)
|
|
$
|
(628
|
)
|
|
|
|
|
|
||||
Short-term borrowings, net
|
|
$
|
(250
|
)
|
|
$
|
50
|
|
|
|
|
|
|
||||
Preferred stock dividend payments
|
|
$
|
—
|
|
|
$
|
(3
|
)
|
|
|
|
|
|
||||
Common stock dividend payments
|
|
$
|
(211
|
)
|
|
$
|
(201
|
)
|
|
|
For the Three Months Ended March 31,
|
|
Increase
|
||||||||
Cash Used for Investing Activities
|
|
2020
|
|
2019
|
|
(Decrease)
|
||||||
|
|
(In millions)
|
||||||||||
Property Additions:
|
|
|
|
|
|
|
||||||
Regulated Distribution
|
|
$
|
338
|
|
|
$
|
318
|
|
|
$
|
20
|
|
Regulated Transmission
|
|
269
|
|
|
231
|
|
|
38
|
|
|||
Corporate / Other
|
|
9
|
|
|
5
|
|
|
4
|
|
|||
Investments
|
|
5
|
|
|
9
|
|
|
(4
|
)
|
|||
Asset removal costs
|
|
43
|
|
|
65
|
|
|
(22
|
)
|
|||
Other
|
|
(5
|
)
|
|
2
|
|
|
(7
|
)
|
|||
|
|
$
|
659
|
|
|
$
|
630
|
|
|
$
|
29
|
|
|
|
|
|
|
|
|
•
|
an increase of $20 million at Regulated Distribution due to investments in electric system improvements and modernization projects to increase reliability; and
|
•
|
an increase of $38 million at Regulated Transmission due to timing of capital investments associated with its Energizing the Future investment program.
|
Guarantees and Other Assurances
|
|
Maximum Exposure
|
||
|
|
(In millions)
|
||
FE’s Guarantees on Behalf of its Consolidated Subsidiaries
|
|
|
||
AE Supply asset sales(1)
|
|
$
|
570
|
|
Deferred compensation arrangements
|
|
477
|
|
|
Fuel related contracts and other
|
|
4
|
|
|
|
|
1,051
|
|
|
FE’s Guarantees on Other Assurances
|
|
|
||
Global holding facility
|
|
114
|
|
|
Deferred compensation arrangements
|
|
150
|
|
|
Surety Bonds
|
|
336
|
|
|
LOCs and other
|
|
16
|
|
|
|
|
616
|
|
|
Total Guarantees and Other Assurances
|
|
$
|
1,667
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(1)
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As a condition to closing AE Supply’s sale of four natural gas generating plants in December 2017, FE provided the purchaser two limited three-year guarantees totaling $555 million of certain obligations of AE Supply and AGC. In addition, as a condition to closing AE Supply’s transfer of Pleasants Power Station and as contemplated under the FES Bankruptcy settlement agreement, FE has provided two guarantees for certain retained environmental liabilities of AE Supply, including the McElroy’s Run CCR Impoundment Facility.
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(1)
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Surety Bonds are not tied to a credit rating. Surety Bonds’ impact assumes maximum contractual obligations (typical obligations require 30 days to cure).
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ITEM 3.
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QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
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ITEM 4.
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CONTROLS AND PROCEDURES
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Exhibit Number
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Description
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||
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(A) (B)
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10.1
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|
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(A) (B)
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10.2
|
|
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(A) (B)
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10.3
|
|
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(A)
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31.1
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|
|
(A)
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31.2
|
|
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(A)
|
32
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|
|
|
101
|
|
The following materials from the Quarterly Report on Form 10-Q of FirstEnergy Corp. for the period ended March 31, 2020, formatted in iXBRL (Inline Extensible Business Reporting Language): (i) Consolidated Statements of Income and Consolidated Statements of Comprehensive Income, (ii) Consolidated Balance Sheets, (iii) Consolidated Statements of Cash Flows, (iv) related notes to these financial statements and (v) document and entity information.
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|
104
|
|
Cover Page Interactive Data File (the cover page XBRL tags are embedded within the Inline XBRL document)
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|
FIRSTENERGY CORP.
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|
Registrant
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|
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/s/ Jason J. Lisowski
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|
Jason J. Lisowski
|
|
Vice President, Controller
and Chief Accounting Officer
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(a)
|
Vesting. Except as otherwise provided in Sections 6 and 7 below, if and to the extent the performance goals set forth on Exhibit A attached to this Agreement (the “Performance Goals”) are achieved during the performance period set forth on Exhibit A (the “Performance Period”), the RSUs will vest on March __, 2023 (the “Vesting Date”), as long as the Grantee remains continuously employed by the Company or a Subsidiary until such Vesting Date. The number of RSUs that shall vest will range from 0% to 200% of the Target Number, as determined by the extent to which the Performance Goals are achieved. The Grantee will have no rights to any payment with respect to the RSUs until the RSUs have vested (each RSU that vests pursuant to this Section 4 or Sections 6 and 7 below, a “Vested RSU”). Prior to settlement, each RSU (whether or not a Vested RSU) represents an unfunded and unsecured obligation of the Company.
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(b)
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Settlement. Except as otherwise provided in Sections 6, 7 and 10 below, the Company shall settle each Vested RSU by making a cash payment equal to the Fair Market Value of one Share per Vested RSU to the Grantee as soon as administratively practicable (and no later than 60 days) after the Vesting Date. With respect to any Vested RSU, the Fair Market Value of one Share shall be determined as of the Vesting Date, except as provided in Section 6. Notwithstanding the foregoing or any provision in Sections 6 or 7 to the contrary, if the Grantee elects to defer the settlement of the RSUs pursuant to the Company’s Executive Deferred Compensation Plan (or any other non-qualified deferred compensation plan providing for the ability to defer settlement of the RSUs), then the time, form and medium of payment with respect to any deferred RSUs shall be made pursuant to the terms and conditions of the Executive Deferred Compensation Plan (or similar non-qualified deferred compensation plan).
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(a)
|
Death. If, at least one month after the Grant Date but prior to the Vesting Date, the Grantee dies, a prorated number of RSUs shall become Vested RSUs. For purposes of this Section 6(a), the number of RSUs that shall become Vested RSUs due to the Grantee’s death shall be equal to (i) the Target Number of RSUs multiplied by (ii) a fraction, where the numerator is the number of full calendar months the Grantee remained employed after the Grant Date and the denominator is 36. The Company shall settle any RSUs that become Vested RSUs under this Section 6(a) by paying the Grantee’s estate a cash amount equal to the Fair Market Value of one Share for each Vested RSU as soon as administratively practicable after the date of the Grantee’s death, but in any event, by March 15th of the year following the year in which the Grantee’s death occurred. For purposes of this Section 6(a), the Fair Market Value shall be determined as of the date of the Grantee’s death.
|
(b)
|
Disability. If, at least one month after the Grant Date but prior to the Vesting Date, the Grantee’s employment is terminated due to the Grantee’s Disability, then, after the end of the Performance Period, a Prorated Number of RSUs shall become Vested RSUs (as determined in Section 6(f) below). The Company shall settle any RSUs that become Vested RSUs under this Section 6(b) by paying the Grantee a cash amount equal to the Fair Market Value of one Share for each Vested RSU as soon as administratively practicable after the Vesting Date, but in any event within the short-term deferral period specified in Treasury Regulation § 1.409A-1(b)(4).
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(c)
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Termination without Cause. If, at least one month after the Grant Date but prior to the Vesting Date, the Grantee’s employment is terminated by the Company or a Subsidiary without Cause, then, after the end of the Performance Period, a Prorated Number of RSUs shall become Vested RSUs (as determined in Section 6(f) below). The Company shall settle any RSUs that become Vested RSUs under this Section 6(c) by paying the Grantee a cash amount equal to the Fair Market Value of one Share for each Vested RSU as soon as administratively practicable after the Vesting Date, but in any event within the short-term deferral period specified in Treasury Regulation § 1.409A-1(b)(4).
|
(d)
|
Retirement. If, at least one month after the Grant Date but prior to the Vesting Date, the Grantee’s employment is terminated due to the Grantee’s Retirement, then, after the end of the Performance Period, a Prorated Number of RSUs shall become Vested RSUs (as determined in Section 6(f) below). The Company shall settle any RSUs that become Vested RSUs under this Section 6(d) by paying the Grantee a cash amount equal to the Fair Market Value of one Share for each Vested RSU as soon as administratively practicable after the Vesting Date, but in any event within the short-term deferral period specified in Treasury Regulation § 1.409A-1(b)(4).
|
(e)
|
Change in Position. If, at least one month after the Grant Date but prior to the Vesting Date, the Grantee is transferred to a position with the Company or a Subsidiary that is not an executive position eligible for such an award, then, after the end of the Performance Period, a Prorated Number of RSUs shall become Vested RSUs (as determined in Section 6(f) below). The Company shall settle any RSUs that become Vested RSUs under this Section 6(e) by paying the Grantee a cash amount equal to the Fair Market Value of one Share for each Vested RSU as soon as administratively practicable after the Vesting Date, but in any event within the short-term deferral period specified in Treasury Regulation § 1.409A-1(b)(4).
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(f)
|
Prorated Vesting. The Prorated Number of RSUs described in Section 6(b), (c), (d) or (e) above (the “Prorated Number”) shall be determined as follows:
|
(g)
|
Release Requirement. Notwithstanding any provision herein to the contrary, except as otherwise determined by the Company, in order for the Grantee to receive payment pursuant to the settlement of Vested RSUs under Section 6(a), (b), (c), (d) or (e) above, the Grantee (or the representative of his or her estate) must execute and deliver to the Company a general release and waiver of claims against the Company, its Subsidiaries and their directors, officers, employees, shareholders and other affiliates in a form that is satisfactory to the Company (the “Release”). The Release must become effective and irrevocable under applicable law no later than 60 days following the date of the Grantee’s death, termination of employment or transfer of position, as applicable.
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14.
|
Miscellaneous Provisions.
|
1.
|
I have reviewed this report on Form 10-Q of FirstEnergy Corp.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a)
|
all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
|
/s/ Charles E. Jones
|
|
|
Charles E. Jones
|
|
|
President and Chief Executive Officer
|
|
1.
|
I have reviewed this report on Form 10-Q of FirstEnergy Corp.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a)
|
all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
|
/s/ Steven E. Strah
|
|
|
Steven E. Strah
|
|
|
Senior Vice President and Chief Financial Officer
|
|
|
/s/ Charles E. Jones
|
|
|
Charles E. Jones
|
|
|
President and Chief Executive Officer
|
|
|
|
|
|
/s/ Steven E. Strah
|
|
|
Steven E. Strah
|
|
|
Senior Vice President and Chief Financial Officer
|
|