Alliant Energy Corp (LNT) 2004 Q2 法說會逐字稿

Thank you for holding, ladies and gentlemen, and welcome to Alliant Energy's second-quarter 2004 earnings conference call. At this time, all lines are in a listen-only mode. I would now like to turn the call over to host, Eliot Protsch, Alliant Energy's Senior Executive Vice President and Chief Financial Officer.

Good morning, and thank you for joining us today. We welcome those of you on the phone, and also those of you who are joining us via the Web. We appreciate your continued interest in and support of Alliant Energy.

With me today are Erroll Davis, Alliant Energy's Chairman and Chief Executive Officer; Bill Harvey, President and Chief Operating Officer, and various other senior executives in our organization.

As most of you are aware, earlier this morning, we issued a news release announcing Alliant Energy's second-quarter 2004 earnings and affirming our 2004 earnings guidance. If you haven't seen the release, a copy of this is available on our website in the investor's section. We have allotted an hour for this morning's call, which will include time to take questions from members of the investment community.

First I will discuss our second-quarter earnings and provide some financial highlights of the quarter. I will then turn the call over to Bill, who will discuss some of our key operational developments since our last earnings call, and Erroll will close by summarizing our current business strategy.

I would like to remind you that the remarks we make on this call and our answers to your questions include forward-looking statements. These forward-looking statements are subject to risks that could cause our actual financial results to be materially different. Those risks include among others, matters discussed in Alliant Energy's news release issued this morning, and in Alliant Energy's filings with the Securities and Exchange Commission. We disclaim any obligation to update these forward-looking statements.

With that housekeeping out of the way, let me get to the focus of our call this morning, our earnings. Today, Alliant Energy reported a loss from continuing operations for the second quarter of 2004 of $13.1 million, or 12 cents per share, including the effect of the impairment charges discussed in our July 14th conference call. By comparison, in the second quarter of 2003, we reported income and earnings per share from continuing operations of $11.7 million and 13 cents, respectively.

On a total net income basis, net income and EPS for the second quarter of 2004 were also a loss of $13 million or 12 cents, respectively. This compares to net income of 32 million and EPS of 35 cents for the same period in 2003, which included various transactions related to our discontinued operations, including the impact of the sale and loss of our Australian business.

I would emphasize that, as we announced on July 13th, our second-quarter 2004 results include a $40.3 million, or 36 cents per share, after-tax impairment charge relating to the write-off of goodwill of several of our integrated services businesses, or what refer to as ISCO. These non-regulated businesses included our Energy Service business, which is comprised of Cogenex Corp. and affiliated companies, and our Earnings Management Services business. We also announced on July 13th our intentions to sell these businesses in addition to our Gas Marketing business within our ISCO platform. Excluding this impairment charge, our earnings per share from continuing operations for the second quarter of 2004 would have been 24 cents per share compared to 13 cents per share in the same period in 2003. Further, as we noted in our July 14th conference call on this issue, we don't expect this non-cash charge to effect our 2004 earnings from continuing operations, as we expect these businesses to be reclassified to discontinued operations in the second half of 2004. On that note, we did affirm our 2004 earnings guidance for our earnings from continuing operations in the news release we issued earlier today.

Erroll will discuss later the strategic reasons that led us to our decision to divest these businesses. At this time, I would like to focus on the second-quarter results. I would first highlight that our two domestic utilities, Interstate Power & Light Company and Wisconsin Power & Light, had a very good quarter, earning 42 cents per share as computed, based on the average shares outstanding in the second quarter of 2003. This compares very favorably with our second-quarter 2003 results, where they earned 24 cents per share. In fact, our utilities, which remain the focus and foundation of our Company, once again had a good quarter, both operationally and financially. Excluding the 36-cent impairment charge, our non-regulated businesses posted a 12-cent per share loss this quarter compared to a loss of 2 cents per share for the same period in 2003. The largest component of the 2004 loss came from our international portfolio. The results from our Brazilian investments were negatively impacted by foreign currency transaction losses related to approximately 40 million of nonlocal currency denominated debt at one of the Brazilian operating companies, as well as higher operating litigation-related and interest expenses. Earnings from Alliant Energy's China and New Zealand investments were also slightly lower in the second quarter of 2004 compared to the same period in 2003. The total loss from continuing operations for the non-regulated businesses in the second quarter in 2004 and 2003 was negative 51.7 million and negative 2.2 million, respectively. Again, the negative $51.7 million includes the aforementioned impairment charges. Bill will provide more detail on the issues affecting the performance of our non-regulated businesses later in his remarks.

But now, I'd like take a few moments to discuss several key financial measures and to update you on the status of various financings. We are in the preliminary stages of preparing the cash-flow statements that will be included in our second-quarter 10-Q filing in August. Our current analysis suggests that our cash flows from operations in the second quarter of 2004 were significantly higher than those in the same period in 2003. Thus, at this time, we are affirming that our 2004 forecast for cash flow from operations remain in the range of $500 to $600 million for the year. Our anticipated 2004 capital expenditures are unchanged from our previous guidance at approximately 700 million, of which we have expended 296 million through tuna. Approximately 90 percent of these capital expenditures were related to our domestic utilities operations.

With respect to financings, in May, we completed a $100 million offering of senior unsecured debentures at our Iowa utilities subsidiary, Interstate Power & Light, to replace the short-term debt we incurred in connection with the construction of the Emery generating station. Second, we raised approximately 37 million in net proceeds at prevailing market prices from our continuous equity offering program since its inception in May. As previously stated, we contemplate issuing up to 150 million in common equity in 2004 under the terms of the shelf registration statement we filed earlier this year with the SEC. The continuous equity offering program gives us the flexibility to issue small amounts of equity throughout the year. Our remaining equity needs could be met through the use of this program, or we also could elect to supplement it with a traditional follow-on offering at our discretion. In any event, as we have previously stated, we have included our assumptions related to our common equity issuance in 2004 in our earnings guidance. We also plan to sell our remaining residual interest of approximately 1.1 million shares in Whiting Petroleum in 2004. These shares are currently trading at around $25 per share, which is approximately $10 higher per share than our basis in this investment. As stated previously, our current earnings guidance does not include any gain that we may realize on this sale.

I would also note that after the goodwill charge, the aggregate book capitalization including debt of the ISCO businesses now for sale, is approximately $55 million. It is our intent to use all proceeds from the sale of these businesses toward the continued reduction of debt at Alliant Energy Resources. As we have indicated in the past, we remain committed to maintaining a debt-to-total-capital ratio in the high 40 to low 50 percent range over the long-term. On June 30th, our debt-to-total-capital ratio was unchanged from where it stood at the end of the first quarter, 47 percent. We are certainly very pleased with our improvements in our financial profile, as this represents a significant improvement when compared to our debt-to-total-capital ratio of 61 percent back in the first quarter of 2003.

I also wanted to point out that our interest expense for the second quarter of 2004 was approximately $11 million lower than the same period in 2003, with approximately $8 million of this reduction coming from our non-regulated businesses. This is largely due to the utilization of the proceeds we received in 2003 from the sale of the various non-regulated businesses to reduce the debt we had outstanding at our non-regulated businesses. The impact of the additional equity we issued during the last 12 months, various debt refinancings, and our stronger financial profile, also contributed to this positive variance. Our liquidity position, consisting of cash and availability under our credit facilities, remains strong, at approximately $750 million at the end of June. We had short-term debt borrowings of approximately 100 million outstanding at the end of June, largely within our domestic utility business.

I am also very pleased to announce that yesterday, we successfully completed syndication of our revolving credit facilities, totaling 650 million. We now have five-year facilities. I should note, however, that the length of those facilities is still subject to various state and federal regulatory approvals, given the term is longer than a 365-day facility. These new facilities replace the former 364-day facilities that were set to expire in September, and are available to support commercial paper and/or direct borrowings. The combined total amount of the facilities remains the same. However, we have shifted 100 million of the borrowing capability from our parent facility, which principally supports our non-regulated and service company borrowing needs, to our utilities facilities. The borrowing capabilities under the new facilities are 300 million at Interstate Power 7 Light; 250 million at Wisconsin Power & Light; and 100 million for our parent company. This shift is consistent with our continued focus on our domestic utilities business, as it is the primary business where we are investing capital.

With that, I would like to turn the call over to Bill Harvey, our President and Chief Operating Officer, who will provide some additional insights into our operational performance so far this year.

Thank you, Eliot, and good morning, everyone. I will begin with our utility operations. First, I'd emphasize that our two regulated domestic utilities, WP&L and IP&L, continue to perform very well. More specifically, both are firmly focused on providing safe and reliable energy for our customers, and both are focused on opportunities in our service territories that simply did not exist several years ago. Both remain the core of our business.

Our utility earnings were positively affected by rate relief throughout our utility jurisdictions, as well as increased sales of 3 percent to our retail customers. These positive earnings effects were partially offset by higher than anticipated fuel and purchase power costs at Wisconsin Power & Light Company. Milder than normal weather also had a surprisingly modest negative impact on our electric margins in the second of 2004.

Let me move on and share some recent regulatory developments that we expect will continue to positively affect our utility performance going forward. As we discussed in our July 14th conference call, we moved one step closer to resolving uncertainty in Interstate Power & Light's pending Iowa retail electric rate case. More specifically, we filed a non-unanimous settlement proposal in the case, agreeing to a final revenue requirement of $107 million. Of the 9 major parties in the case, 6 are currently party to that agreement. If approved by the Iowa Utilities Board, this increase, which is $9 million more than the interim order that went into effect in June, would go into effect in the first quarter of 2005. The settlements also established a 10.7 return on equity on our Iowa utility investments, with the exception of our Emery generating station, which will continue to earn an allowed return on equity of 12.23 percent. As you will recall, the return on equity for our investment in Emery was established upfront through the rate-making principals previously approved by the Iowa Utilities Board under the provisions of Iowa House File 50077. Earlier this year, Wisconsin Power & Light Company filed for a $15.8 million fuel-only retail electric rate increase. On March 26th, the Public Service Commission of Wisconsin issued its interim order on that request, granting the full $15.8 million increase. The regulatory process in Wisconsin enables us to adjust our request, either up or down, in response to fuel cost changes since the interim order was issued. There have been modest increases in our fuel and purchase power costs since the interim order was issued, and we will update the record in the rate proceedings as allowed and appropriate. We expect the final decision in this case by the end of August, with final rates effective in the month of September.

I would now like to update you on some recent developments as relates to our domestic utility generation plans. First, we take great pride in the fact that we were able to complete our 565 MW Emery generating station both on-time and on budget in the second quarter of this year. While we are still in the final testing stages, Emery has been able to run during times of peak demand in order to help us meet our customers' needs. In addition, Calpine's Riverside energy center in Beloit, Wisconsin, was placed in service in the second quarter of this year, as planned. Alliant Energy has contracted for 453 MW of that plant's output.

We also continue to make good progress with our plans to build a 300 MW simple-cycle natural gas plant near Sheboygan Falls, Wisconsin. As we've discussed in the past, this site was already under development by Power Ventures Group, a subsidiary of Burns & McDonald. Our plan for Sheboygan Falls is to utilize a similar structure to that which has already been approved by the Public Service Commission of Wisconsin, or another Wisconsin utility. Our proposed structure is for Alliant Energy generation to build and own the facility, and to enter into a long-term lease agreement with Wisconsin Power & Light Company. WP&L would operate and maintain the facility, as well as purchase the power generated by the facility. The project is, of course, subject to Public Service Commission of Wisconsin approval, and we are making steady progress towards the receipt of that approval. In fact, we received 3 favorable rulings from the Public Service Commission of Wisconsin last week. The Sheboygan Falls plant is currently expected to be placed in service in 2005, in time to meet our increased summer demands.

Additionally, we are reviewing bids in response to a request for a proposal for 100 MW of nameplate wind generating capacity to be online in Wisconsin in 2005. Moving forward with this component of our integrated generation plan is, of course, contingent upon a renewal of the Federal Renewable Energy Production Tax Credit, which we hope will be addressed later this year. And finally, working with our co-owner, Wisconsin Public Service Corp., we continue to make good progress on the pending sale of our interest in the Kewaunee Nuclear Power Plant to Dominion Resources.

Let me now shift to the non-regulated side of our business. As demonstrated by our recent announcement to divest a group of our non-regulated companies involved in Energy Services, Gas Marketing, and Energy Management, we continue to narrow our business scope and focus on opportunities available to us in our core domestic utilities. However, we are maintaining other ongoing business platforms. And we are committed to ensuring that they contribute positively to the long-term value of our company. We are not satisfied with our international investments' profitability in the second quarter as a whole. More specifically, as Eliot said, our results from Brazil were a loss of $8 million as compared to a loss of $1 million in the same period in 2003, after all allocated debt, capital, and overhead charges. There were several factors that contributed to these lower results, including -- higher operating expenses and higher interest expenses. In addition, litigation expenses related to our recent disputes with our partners also contributed to this loss. However, I would emphasize that the crux of our disagreement with our partners relates to our partners' apparent preference to pay dividends rather than utilizing funds to reduce debt or retaining funds to redeploy in the business and improve the financial performance of the business. The Brazilian courts and Brazilian regulators continue to review this and several related issues. The lower results in Brazil were partially offset by the impact of various tariff increases implemented at the Brazil operating companies in both 2003 and in this year.

The results from our China and New Zealand investments were also slightly lower in the second quarter of 2004 compared to the same period in 2003. The slightly lower results in China were largely due to higher than anticipated delivered coal costs. Coal prices escalated faster than our ability to recover such costs in tariffs, a problem we are very familiar with here in our domestic utility operations. We have, in fact, received some rate increases, and continue to pursue tariff relief for all of our facilities.

As relates to our ISCO businesses, I would emphasize that the losses from the businesses we are divesting were 6 cents per share in the second quarter of 2004, and we expect these businesses will be reclassified to discontinued operations in the second half of 2004.

And finally, let me take just a moment to talk about the status of another of our non-regulated investments, our $80 million investment in the infrastructure of a Mexican resort community, Laguna del Mar. While we have made progress in the past year in the development of the project infrastructure, we have found the developer's pace and level of performance to be unacceptable, and are now moving forward to resolve that situation. We continue to make steady progress in our discussions with our partners to resolve the matter.

Now, I would like to turn the program over to Erroll Davis, who will discuss our strategy going forward.

Thank you, very much, Bill, and good morning to all of you. I am going to be very brief this morning in the interest of time. What I'd like to do first is reinforce that our second-quarter results from our perspective were in fact very good. Our domestic utilities are performing well, both operationally and financially, and we continue to receive solid ratings in national customer satisfaction surveys. As we have always stressed, our domestic utilities form the foundation of Alliant Energy, and it is a strong foundation, indeed. We are meeting commitments, both to our shareowners as well as our customers.

Now, let me provide a few comments on our key announcements during the quarter -- the decision to exit several additional non-regulated businesses, while providing, hopefully, some insight into our business strategies going forward. Some of you have asked, why did you choose to sell this set of ISCO businesses? As we have stated in the past, we are committed to streamlining our portfolio of businesses to those that are already providing meaningful earnings in cash flows and in which we are prepared to invest the capital needed to generate such earnings and cash flows. In addition, the sale of these businesses will reduce the number of subsidiaries that we must manage and support, both organizationally and financially at the parent-company level. And finally, the decision to divest these businesses is yet one more example of our efforts to narrow our strategic focus and concentrate on those opportunities now available to us in our domestic utility operations.

Now let me hopefully anticipate and respond to the question that may be asked, which is -- does this mean you are exiting, or you are on a path to exit all of your non-regulated businesses? The answer, as Bill indicated, is no. But since this is an election year, let me add several qualifiers. Let me be clear -- our domestic utility business continues to be our foundation, and it will be the primary target of our future capital investments. But, our remaining non-regulated businesses will continue to be part of our ongoing business portfolio. However, I would once again emphasize that management continues to evaluate the performance of all of our businesses, both utility and non-regulated, and is focused on taking actions to increase the returns we are earning on our invested capital in all of our businesses.

Further, as evidenced by our action these past several years, we remain committed to narrowing our strategic focus and simplifying our non-regulated structure to reduce both its complexity as well as the current volatility of earnings from these businesses.

In summary, I'd again emphasize that our stated earnings from continuing operations this quarter truly do not reflect our operational performance. As Eliot previously stated, if you exclude the non-cash goodwill impairment charge, our earnings from continuing operations for the second quarter of 2004 were actually significantly higher than last year's results for the same period. And because we expect these businesses will be included in our results from discontinued operations sometime in the second half of 2004, we are able today to affirm our earnings guidance from continuing operations at $1.75 to $2 per share, which includes guidance for our domestic utility operations of $1.75 to $1.09 per share.

That said, we all know the road before us will not be an easy one. While we are largely pleased with our successful execution on our more narrowly focused strategy to-date, we are far from satisfied. Our entire team understands that we must be ready to not only face potential challenges, but also to take advantage of potential opportunities. In fact, as I look back over the last several years, I take great pride in the approach our employees have adopted in their seemingly endless ability to not only confront, but to capitalize on whatever issues or scenarios arise.

Now let me turn the call back over to the conference call operator to explain how the question-and-answer session will work. But before that begins, I would again like to thank you for your continuing interest and support of Alliant Energy. Operator?

(OPERATOR INSTRUCTIONS). Dave Parker, Robert Baird.

Good morning, and congratulations on another good quarter. I had a few questions, maybe more than I usually do, if you could bear with me. First off, if we focus on Brazil just a second. I think the press release talked about currency variations. And in your prepared text, you talked about increased interest expense. Is that one in the same issue or item?

No, they are not, David. They are different. If you remember, we have down there, a foreign currency denominated loan of $40 million, which is not a dollar-denominated loan; it's based on a market basket of currencies. And again, we saw some currency movement in that. And the other, of course, is a general translation of profitability from Brazil.

In-country, they have had now five consecutive quarters of profitability, in-country. And so if you would combine slight movements in currency with, again, continuing interest costs there and at the parent, they were not positive at the parent. But again, I want to stress, in-country, they have been positive, and we are not looking at any structural issues there that cause us concern. As Bill mentioned, costs are rising, but we are getting rate increases, and just as with our utilities in the United States, we always suffer slight margin compression before we get those increases in place. In fact, this year, we have had 4 double-digit rate increases put in place already in an environment where we have about 6 percent inflation. So the utilities are running well there.

Is it fair to say, Erroll, that operating income is up, and then when we look at things like interest expense, litigation, as you identified, those type of items, that that's where we saw the slight setback this quarter?

The operating income on a year-over-year basis, because of cost pressures, is not up. But operating income certainly is positive in-country to slightly down on a year-over-year basis. But again, as I've said, we are moving to reduce costs there, but we are -- we're moving to reduce interest expense at the parent, as well.

And on the litigation with your partner in-country, it sounds like you are exploring several different options. And I don't know if you can comment on this or not, but is part of the option saying you could buy us out?

We are looking at virtually every option conceivable to us in terms of improving our position in Brazil. That could run the gamut from a total restructuring of our relationship to a re-healing of our relationship to a reduction of our relationship or even the elimination of our relationship. So we are literally looking at every alternative possible in terms of improving the financial performance of our investment in that country.

Okay. All right, thank you. I'm sorry to focus upon -- I know you had a great quarter, just on that operation so far, in my questions anyways. Could you comment on the track that the approval for the Sheboygan Falls generating asset is on? Is that getting fast track -- if I recall right, is that getting fast track approval? And what's the timetable there?

The timetable, David, is that we would expect that all approvals would be behind us by early to middle part of the second -- or the first quarter of next year. I would not characterize the process as being fast track. The Commission in Wisconsin is always appropriately concerned about providing opportunities for public input. But as the Commission has demonstrated over the course of the last one to two years, they are moving regulatory proceedings along in Wisconsin at a considerably more rapid pace than has been the case historically. So I would not call it fast track, but I would certainly call it efficient regulation.

Okay, good. Any expectations on what the total cost for the facility could be?

Our estimate is approximately 150 to $160 million.

A question on the Wisconsin operations -- when we look at -- I think your commentary that fuel and purchase power costs dinged you maybe a little bit -- I think, Bill, you talk about revising your current rate case. Is it not out of the band to be able to adjust it, to get recovery of those costs current year? Or you just expect to get true-up or get the next rate case sort of to where the costs are today?

Certainly, to the extent that we have experienced actual fuel and purchase costs, cost of power cost increases, from the timeframe that the interim order was issued until the timeframe that the final order is put into effect, we have some exposure in that timeframe. But the new fuel rules put in place by the commission do enable us to update our fuel filings to reflect current forward strips on gas; current forward delivery costs of fuel if they deviate from those in the filings. I have to mention -- that can be up or down, depending on what happens. But the trend right now is that experienced costs are higher than those reflected in the interim order, and we will make appropriate upward adjustment requests, and are hopeful that the Commission will recognize and allow them in the final order. But there is some exposure in the interim.

I want to make sure, David, that you understand that we do not have to make a new fuel filing. We are in the middle of a case right now where we have received an interim order, and we expect the Commission, based on its present schedule, I believe, to be finished sometime in September or August. And prior to that, we will be able to put in the most up-to-date costs. And so we do not have to go through -- we certainly have to file the up-to-date costs, but in terms of putting in a new -- filing for a new hearing -- we do not have to do that.

That's good. Just a couple more questions; I'm sorry, I hope these are quick. Kewaunee, with the paper makers throwing in or supporting the sale of a nuclear unit, any more update on that whole transaction and the Commission approval that you can give us?

It's really nothing new, David; it's lending its way through that efficient Commission approval process, and we are hopeful that the Commission will issue an order sometime around the end of the year, and we are hopeful that it will be favorable.

I think you've used "efficient" for Wisconsin Commission about ten times (laughter). It sounds like it's a political year -- that's good. That's a good one. How about Iowa? Are they efficient regulators on your current settlement?

They are, indeed. And I use that term advisedly, because we can all remember years ago with respect to the Wisconsin Regulatory process in particular -- that it was not particularly efficient; regulatory lag was a great concern to our Company and other Wisconsin companies. And to the credit of Governor Doyle and the existing Commission, they have solved those inefficiencies, as they should have.

Good. One last question -- is there a significant change in the interest rate for your new credit facility? And congratulations on getting that done as well?

No, it's very competitive, David. This is Eliot. We feel really good about that.

Good. I lied. Laguna del Mar -- in keeping with the political year -- I lied -- Laguna del Mar, what's your investment there, currently?

About $82 million.

Great, that's it. Thank you.

(OPERATOR INSTRUCTIONS). Michael Winston, Zimmer Lucas.

Hi. I'm sorry if I missed this; but I'm just wondering how much progress has been made in the sale of equity this year so far?

Mike, this is Eliot. $37 million has been sold through the end of Q2.

Okay.

Through that program, we also have some drip sales.

All right -- plus drip then, in addition to that. And the goal is to stay in the high 40's, which it sounds like you already are. Is that -- do you envision that that's going to be a problem at all? Or -- additional equity --

No, we do not. I mean as we stated in our various disclosures, and in this call, it is our intent to sell up to $158 million (ph) (multiple speakers) through this program.

That was it.

David Grumhaus, Copia Capital.

Good morning, guys, congrats on a nice order. With regards to Brazil, any sense of timing on that, that we should look forward for in terms of when you think you may get something resolved there?

This is Bill Harvey. Certainly, we have got the shoulder to the wheel in Brazil very hard. It's very difficult for us to predict when we might expect our affairs to be resolved in that country. We certainly hope that that could occur yet this year; but the fact of the matter is that it could be this year; it could be next year. I think, if you would, what's important from our perspective is our conviction to get it resolved, which is strong.

Okay. In terms of the FX, the foreign exchange hit, how should we be thinking about that sort of quarter to quarter? Is it purely a dollar strength type of thing?

I think primarily, yes, but as I mentioned, we have a $40 million loan, which is a somewhat complex market basket of different currencies, all of which are not moving at the same pace at the same time in the same direction. And so you will have to essentially wait for the filing of our Q's for us to provide more robust detail on that. What we can tell you, of course, is what you already know -- in terms of the papers that the exchange there has softened a bit in the quarter. It was 2.89 for the AI (ph) set at the end of March; and at the end of June, it was 3.09. And so, again, it had softened a bit.

Okay. On the ISCO losses, am I understanding you correctly that you had 6 cents of losses in the second quarter on those businesses, those will go discontinued beginning with the third quarter. And then your guidance of $1.75 to $2, does that include the 6 cents of losses, or are you assuming those go off, too, because the whole thing goes discontinued?

Let me first, disabuse you of one slight statement that you made that we expect them to become discontinued operations sometime in the second half. There are approximately 7 tests that we have to go through and meet before we can declare something discontinued. We are pretty confident that we can meet all of those tests. But, whether it is the third quarter or the fourth quarter, it's conjectural at the moment.

And you are correct that 6 cents of losses would move to discontinued operations -- 6 cents from the first half will move to discontinued operations in the second half of the year.

With no more questions, this concludes the Alliant Energy second-quarter 2004 earnings conference call. A replay of the call will be available through August 2nd, 2004 800-642-1687 for domestic, and 706-645-9291 for international. Callers should reference conference ID 824-3629. In addition, an archive of the conference call and a script of the prepared remarks made on the call will be available on the investors section of the Company's website at www.AlliantEnergy.com/investors, later today.

Operator, if I would, I would like to take this moment to just say thank you to all of those on the call for their continuing interest in the Corporation. As I said earlier, we are certainly pleased with our continued progress, and we look forward to our next conference when we discuss third-quarter earnings. Thank you.

If members of the investment community have follow-up questions, they should contact Becky Johnson in Investor Relations at 608-458-3267. Thank you.