WEC Energy : Third Quarter 2023 PGL

THE PEOPLES GAS LIGHT AND COKE COMPANY

(An Indirect Wholly Owned Subsidiary of WEC Energy Group, Inc.)

FINANCIAL STATEMENTS

For the Quarter Ended September 30, 2023

THE PEOPLES GAS LIGHT AND COKE COMPANY

CONDENSED CONSOLIDATED INCOME STATEMENTS
(Unaudited)	Three Months Ended			Nine Months Ended
			September 30				September 30
(in millions)	2023			2022			2023				2022
Operating revenues		$	216.3		$	204.8		$	973.5		$	1,164.4
Operating expenses
Cost of natural gas		28.6			22.0			254.2			457.2
Other operation and maintenance		76.6			88.1			268.8			250.9
Depreciation and amortization		54.1			52.9			161.0			156.9
Property and revenue taxes		5.9			6.2			25.1			24.8
Total operating expenses			165.2			169.2			709.1			889.8
Operating income		51.1			35.6			264.4			274.6
Other income, net		1.5			2.3			4.5			9.8
Interest expense		20.5			16.6			60.2			49.3
Other expense			(19.0)			(14.3)			(55.7)			(39.5)
Income before income taxes		32.1			21.3			208.7			235.1
Income tax expense		8.5			6.0			56.2			64.1
Net income		$	23.6		$	15.3		$	152.5		$	171.0

THE PEOPLES GAS LIGHT AND COKE COMPANY

CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)			September 30			December 31
(in millions, except share amounts)			2023			2022
Assets
Current assets
Accounts receivable and unbilled revenues, net of reserves of $98.3 and $108.0 respectively	$	236.5	$	454.9
Accounts receivable from related parties			12.7			24.8
Notes receivable from related party			38.7			46.4
Materials, supplies, and inventories:
Natural gas in storage, at LIFO			117.3			94.9
Materials and supplies			33.1			30.3
Prepayments			11.8			7.5
Collateral on deposit			34.8			28.8
Other			10.0			32.8
Current assets			494.9			720.4
Long-term assets
Property, plant, and equipment, net of accumulated depreciation and amortization of $1,801.1 and
$1,759.2, respectively			5,299.8			5,138.7
Regulatory assets			678.5			691.5
Pension and other postretirement employee benefit assets			140.5			135.1
Other			11.8			11.4
Long-term assets			6,130.6			5,976.7
Total assets		$	6,625.5		$	6,697.1
Liabilities and Shareholder's Equity
Current liabilities
Short-term debt	$	292.9	$	300.3
Accounts payable			168.1			261.8
Accounts payable to related parties			26.6			50.7
Accrued taxes			27.4			59.3
Customer credit balances			85.9			75.5
Other			119.5			111.6
Current liabilities			720.4			859.2
Long-term liabilities
Long-term debt			1,958.4			1,957.5
Deferred income taxes			657.5			619.7
Deferred investment tax credits			26.1			27.1
Regulatory liabilities			426.8			450.3
Environmental remediation liabilities			297.3			305.9
Asset retirement obligations			268.0			260.9
Other			76.4			79.4
Long-term liabilities			3,710.5			3,700.8
Commitments and contingencies
Shareholder's equity
Common stock - without par value, 40,000,000 shares authorized; 25,357,566 shares issued and
outstanding			1,317.9			1,147.8
Retained earnings			876.7			989.3
Shareholder's equity			2,194.6			2,137.1
Total liabilities and shareholder's equity		$	6,625.5		$	6,697.1

THE PEOPLES GAS LIGHT AND COKE COMPANY

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)		Nine Months Ended
			September 30
(in millions)		2023			2022
Operating activities
Net income	$	152.5	$	171.0
Reconciliation to cash provided by operating activities
Depreciation and amortization		161.0			156.9
Deferred income taxes and investment tax credits, net		32.2			20.3
Settlement of asset retirement obligations		(7.9)			(7.4)
Manufactured gas plant remediation costs		(9.7)			(28.9)
Change in -
Accounts receivable and unbilled revenues, net		230.5			68.6
Materials, supplies, and inventories		(25.2)			(30.1)
Amounts recoverable from customers		11.4			15.6
Prepayments		(4.3)			4.7
Collateral on deposit		(6.0)			-
Accounts payable		(92.9)			20.2
Collateral received		-			5.0
Accrued taxes		(31.9)			(25.3)
Customer credit balances		10.4			27.4
Amounts refundable to customers		(2.3)			(2.1)
Other current liabilities		10.4			11.0
Other, net		(15.9)			29.8
Net cash provided by operating activities			412.3			436.7
Investing activities
Capital expenditures		(318.0)			(343.3)
Notes receivable from related party, net		7.7			16.7
Proceeds from the sale of assets		-			59.2
Other, net		0.4			(2.1)
Net cash used in investing activities			(309.9)			(269.5)
Financing activities
Change in short-term debt		(7.4)			(154.0)
Equity contribution from parent		170.0			200.0
Payment of dividends to parent		(265.0)			(215.0)
Net cash used in financing activities			(102.4)			(169.0)
Net change in cash and cash equivalents		-			(1.8)
Cash and cash equivalents at beginning of period		-			1.9
Cash and cash equivalents at end of period		$	-		$	0.1
Supplemental cash flow information
Cash paid for interest	$	50.7	$	41.7
Cash paid for income taxes, net		$	43.6		$	51.2