Tampa Electric completes $550-million notes offering
TAMPA, August 26, 2002
Tampa Electric, TECO Energy’s largest operating company, reported that it successfully completed its $550-million offering of five- and ten-year notes today. The $400 million of ten-year notes have a coupon of 6.375%, and the $150 million of five-year notes have a coupon of 5.375%. Tampa Electric will use the net proceeds of $542.7 million to repay long- and short-term debt, support the Bayside Power Station repowering and for general corporate purposes.
Since January 2001, in support of power plant construction activities at Tampa Electric and its unregulated power affiliate, TECO Power Services, TECO Energy has been active in raising capital, including $1.1 billion through the sale of common equity or equity-linked securities in four separate transactions. Over the same period, TECO Energy and Tampa Electric have accessed the debt-capital markets on nine occasions, including this transaction and TECO Energy’s $700-million five- and ten-year notes offering in May.
Senior Vice President-Finance and CFO Gordon Gillette said, “With the completion of this offering of Tampa Electric notes and the upcoming refinancing of $200 million of maturing TECO Energy debt, which we expect to complete in the next few months, TECO Energy will have completed its corporate financing plan for 2002. This will strengthen the balance sheet and position us well for next year.”
TECO Power Services also plans to complete a $400-million non-recourse project financing for the Dell, McAdams and Frontera power stations later this year. TECO Energy has less than $150 million of debt (including debt at the operating companies) that will mature in 2003.
Additional information related to the company's results through June 30, 2002, including unaudited financial statements; segment revenues and operating income; and electric and gas volumes are available at TECO Energy's web site at www.tecoenergy.com.
TECO Energy is a diversified energy-related holding company headquartered in Tampa with regulated utility operations in Florida and energy-related unregulated operations located primarily across the Sunbelt and in Guatemala. Its principal businesses are Tampa Electric, Peoples Gas System, TECO Power Services, TECO Transport, TECO Coal, TECO Coalbed Methane and TECO Solutions.
Note: This press release contains forward-looking statements, which are subject to the inherent uncertainties in predicting future results and conditions. These forward-looking statements include references to our anticipated funding requirements, which are dependent upon obtaining the expected results from operations and project financing proceeds and maintaining capital requirements at forecasted levels. Certain factors that could cause actual results to differ materially from those projected in these forward-looking statements include the unanticipated need for additional equity capital arising from lower-than-expected cash flow or higher than projected capital requirements and the following: general economic conditions, particularly those in Tampa Electric’s service area affecting energy sales; weather variations affecting energy sales and operating costs; potential competitive changes in the electric and gas industries, particularly in the area of retail competition; regulatory actions affecting Tampa Electric, Peoples Gas System or TECO Power Services; commodity price changes affecting the competitive positions of Tampa Electric and Peoples Gas System, as well as the margins at TECO Coalbed Methane and TECO Coal; energy price changes affecting TPS’ merchant plants; changes in and compliance with environmental regulations that may impose additional costs or curtail some activities; TPS’ ability to successfully construct, finance and operate its projects on schedule and within budget; TPS’ ability to obtain project financing for its Frontera, Dell and McAdams projects; TPS’ ability to sell the output of the merchant plants operating or under construction at volumes and rates to recover the investment; the ability of TECO Energy’s subsidiaries to operate equipment without undue accidents, breakdowns or failures; interest rates and other factors that could impact TECO Energy’s ability to obtain access to sufficient capital on satisfactory terms; and TECO Coal’s ability to successfully operate its synthetic fuel production facilities in a manner qualifying for Section 29 federal income tax credits, which could be impacted by changes in law, regulation or administration. Some of these factors and others are discussed more fully under “Investment Considerations” in TECO Energy’s Annual Report on Form 10-K for the year ended December 31, 2001, and the company’s Registration Statement on Form S-3 (Registration No. 333-83958)