SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 of 15(d) of
The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) July 9, 2003
VECTREN CORPORATION
(Exact name of registrant as specified in its charter)
Indiana 1-15467 35-2086905
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(State of Incorporation) (Commission File Number) (I.R.S. Employer
Identification) )No.)
20 N.W. Fourth Street, Evansville, Indiana 47708
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (812) 491-4000
N/A
(Former name or address, if changed since last report.)
Item 5. Other Events and Regulation FD Disclosure
On July 9, 2003, Vectren Corporation (the Company) issued a press release to
adjust 2003 earnings guidance and to address recent announcements related to the
production of synthetic fuel.
The following excerpts from that press release should be considered filed with
Securities and Exchange Commission.
"Vectren commented on its investment in synthetic fuel operations in light of
recent announcements related to activity in the industry. As background,
Vectren's Coal Mining operations is comprised of Vectren Fuels (Fuels), which
includes its coal mines and related operations and Vectren Synfuels, Inc.
(Synfuels). Synfuels holds one limited partnership unit (an 8.3% interest) in
Pace Carbon Synfuels Investors, LP (Pace Carbon), a Delaware limited partnership
formed to develop, own and operate four projects to produce and sell coal-based
synthetic fuel utilizing Covol technology. Under Section 29 of the Internal
Revenue Code, manufacturers receive a tax credit for every ton of synthetic fuel
sold. To qualify for the credits, the synthetic fuel must meet three primary
conditions: 1) there must be a significant chemical change in the coal
feedstock, 2) the product must be sold to an unrelated person, and 3) the
production facility must have been placed in service before July 1, 1998.
In past rulings, the Internal Revenue Service (IRS) has concluded that the
synthetic fuel produced at the Pace Carbon facilities should qualify for Section
29 tax credits. The IRS issued a private letter ruling with respect to the four
projects on November 11, 1997, and subsequently issued an updated private letter
ruling on September 23, 2002. During June 2001, the IRS began a tax audit of
Pace Carbon for the 1998 tax year and later expanded the audit to include tax
years 1999 and 2000. The IRS has requested numerous extensions to the statute of
limitations for the years under audit, but has not advised Pace Carbon of any
intention to disallow credits.
As a partner in Pace Carbon, Vectren has reflected total tax credits under
Section 29 in its consolidated results through March 31, 2003 of approximately
$25 million. Vectren has been in a position to fully utilize the credits
generated and continues to project full utilization. In addition, Fuels receives
synfuel related fees from synfuel producers unrelated to Pace Carbon for a
portion of its coal production.
On June 27, 2003, the IRS announced that it has reason to question the
scientific validity of certain test procedures and results that have been
presented to it by certain taxpayers with an interest in synfuel operations.
Accordingly, the IRS has suspended the issuance of private letter rulings
concerning whether a significant chemical change has occurred. In addition, the
IRS indicated that it may revoke existing private letter rulings that relied on
the procedures and results under review if it determines that those test
procedures and results do not demonstrate that a significant chemical change has
occurred.
Vectren does not know the specific nature of the synfuel production procedures
and results that are being reviewed by the IRS. At this time, Vectren cannot
predict the outcome of the IRS's review, when the review will be completed or
the ultimate impact, if any, of the review relative to Vectren's investments in
Pace Carbon. Vectren believes that it is justified in its reliance on the
private letter rulings for the Pace Carbon facilities, that the test results
that Pace Carbon presented to the IRS in connection with its private letter
rulings are scientifically valid, and that Pace Carbon has operated its
facilities in compliance with its private letter rulings and Section 29 of the
Internal Revenue Code."
The full press release is included herein at exhibit 99-1.
In connection with the "safe harbor" provisions of the Private Securities
Litigation Reform Act of 1995, the Company is hereby filing cautionary
statements identifying important factors that could cause actual results of the
Company and its subsidiaries, including Vectren Utility Holdings, Inc., Indiana
Gas Company, Inc. and Southern Indiana Gas and Electric Company, to differ
materially from those projected in forward-looking statements of the Company and
its subsidiaries made by, or on behalf of, the Company and its subsidiaries.
Item 7. Exhibits
99-1 Press Release - Vectren Corporation adjusts 2003 earnings guidance and
addresses recent announcements related to the production of synthetic fuel
99-2 Cautionary Statement for Purposes of the "Safe Harbor" Provisions of the
Private Securities Litigation Reform Act of 1995
Item 9. Regulation FD Disclosure and Item 12. Results of Operations and
Financial Condition
The following information is furnished to the Securities and Exchange Commission
under Item 12.
On July 9, 2003, Vectren Corporation issued a press release to adjust 2003
earnings guidance and to address recent announcements related to the production
of synthetic fuel. The press release is included herein as exhibit 99.1.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
VECTREN CORPORATION
July 9, 2003
By: /s/ M. Susan Hardwick
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M. Susan Hardwick
Vice President and Controller