RGS Energy Group, Inc. Reports 2001 First Quarter Earnings

Apr 24, 2001, 01:00 ET from RGS Energy Group, Inc.

    ROCHESTER, N.Y., April 24 /PRNewswire Interactive News Release/ --
 RGS Energy Group, Inc. (NYSE:   RGS) today reported higher earnings of
 $1.31 per common share for the first quarter ended March 31, 2001, as compared
 to $1.07 per common share for the same period in 2000.  First quarter 2001
 results were better than a year ago due primarily to increased wholesale
 electric revenues and a positive earnings contribution from its unregulated
 subsidiary, Energetix.  First quarter positive results were partially offset
 by electric and gas rate reductions, increased purchase power expenses and
 costs associated with the pending merger of RGS Energy and Energy East.  The
 Company completed its share buy-back program in the fourth quarter of 2000,
 which resulted in a reduction of average shares outstanding.
 
     First Quarter 2001 Results:
     First quarter 2001 operating revenues less fuel expenses were up
 $13.5 million compared to the prior year.  Electric revenues, net of fuel and
 purchase power expenses, increased by $6.1 million, reflecting $14.6 million
 in additional wholesale electric revenues driven by higher market prices and
 greater availability of generation, partially offset by lower electric rates
 and increased purchase power and fuel expenses.  Gas revenues, net of gas
 expenses, decreased by $2.7 million due largely to lower regulated gas
 distribution rates and decreased customer consumption in response to higher
 gas commodity prices, slightly offset by the positive effects of a colder
 first quarter of 2001.
     Unregulated revenues, net of fuel, from Griffith Energy, the liquid fuels
 business of Energetix, increased $10.1 million from the first quarter of 2000.
 Unregulated first quarter income is generally driven by the seasonal nature of
 Griffith's heating oil business. However, the first quarter of 2001 also
 reflects the first full quarter of operations after Griffith completed the
 acquisition of Burnwell Gas and certain assets of the New York Fuels Division
 of AllEnergy Marketing, that closed in November of 2000.  In addition to
 already being a profitable business, the Company expects that the liquid fuels
 business will provide an excellent platform for continued growth as
 deregulation evolves in New York State.
     Non-fuel expenses for the first quarter were up $6.6 million compared to
 the same period in 2000 due primarily to RGS Energy expenses related to the
 proposed merger with Energy East and increased unregulated operating expenses
 associated with the acquisitions by Energetix in 2000.
     Thomas S. Richards, Chairman, President and CEO stated that, "I am pleased
 with the performance of both our regulated and unregulated businesses in the
 quarter.  We combined good financial performance for our shareholders with
 reliable energy for our customers at reduced regulated rates for electric
 service and gas delivery service.  As RGS Energy and Energy East move forward
 in the merger process, we are committed to managing the transition to a
 restructured industry while creating benefits for our shareholders, customers
 and the upstate region."
 
     SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT
 OF 1995
     The foregoing contains forward-looking statements within the meaning of
 the "safe harbor" provisions of the United States Private Securities
 Litigation Reform Act of 1995.  Investors are cautioned that such forward-
 looking statements with respect to revenues, earnings, performance,
 strategies, prospects and other aspects of the businesses of RGS Energy and
 Energy East are based on current expectations that are subject to risks and
 uncertainties.  A number of factors could cause actual results or outcomes to
 differ materially from those indicated by such forward-looking statements.
 These factors include, but are not limited to, risks and uncertainties set
 forth in RGS Energy's and Energy East's filings with the SEC, including risks
 and uncertainties relating to: failure to obtain and retain expected synergies
 from the merger between RGS Energy and Energy East and the prior Energy East
 mergers, delays in obtaining or adverse conditions contained in any required
 regulatory approvals, changes in laws or regulations, economic or weather
 conditions affecting future sales and margins, changes in markets for
 electricity and natural gas, availability and pricing of fuel and other energy
 commodities, legislative and regulatory changes (including revised
 environmental and safety requirements), availability and cost of capital and
 other similar factors.  Readers are referred to RGS Energy's and Energy East's
 most recent reports filed with the SEC.
 
     ADDITIONAL INFORMATION AND WHERE TO FIND IT
     In connection with their proposed merger, RGS Energy and Energy East have
 filed a joint proxy statement/prospectus with the Securities and Exchange
 Commission.  INVESTORS AND SECURITY HOLDERS ARE ADVISED TO READ THE JOINT
 PROXY STATEMENT/PROSPECTUS, BECAUSE IT CONTAINS IMPORTANT INFORMATION.
 Investors and security holders may obtain a free copy of the joint proxy
 statement/prospectus and other documents filed by RGS Energy and Energy East
 with the Commission at the Commission's web site at http://www.sec.gov.  Free
 copies of the joint proxy statement/prospectus, and each company's other
 filings with the Commission may also be obtained from the respective
 companies.  Free copies of RGS Energy's filings may be obtained by directing a
 request to RGS Energy Group, Inc., 89 East Avenue, Rochester, NY 14649,
 Telephone: (800) 724-8833.   Free copies of Energy East's filings may be
 obtained by directing a request to Energy East Corporation, P.O. Box 3200,
 Ithaca, NY 14852-3200, Telephone: (800) 225-5643.
 
     PARTICIPANTS IN SOLICITATION
     RGS Energy Group, Inc., Energy East Corporation and their respective
 directors, executive officers and other members of their management and
 employees may be soliciting proxies from their respective stockholders in
 connection with the merger.  Information concerning RGS Energy's participants
 in the solicitation is set forth in RGS Energy's Current Report on Form 8-K
 filed with the Commission on February 20, 2001, and information concerning
 Energy East's participants in the solicitation is set forth in Energy East's
 Current Report on Form 8-K filed with the Commission on February 20, 2001.
 
 
                             RGS Energy Group, Inc.
                   HIGHLIGHTS- FOR THE PERIODS ENDED MARCH 31
     3 MONTHS                                            2001           2000
 
     TOTAL OPERATING REVENUES                    $507,779,000   $385,851,000
     NET INCOME (BEFORE PFD DIVDS)                $46,303,000    $39,342,000
     NET INCOME APPLICABLE TO
       COMMON STOCK                               $45,378,000    $38,417,000
     AVERAGE SHARES OUTSTANDING                    34,577,000     35,783,000
     BASIC EARNINGS PER SHARE                           $1.31          $1.07
     ELECTRIC SALES (GWH):
      RETAIL                                            1,379          1,494
      LSEs                                                354            250
      OEUs                                                550            441
     GAS SALES (Mdt)                                   22,508         22,947
     HEATING DEGREE DAYS                                3,267          3,025
 
 
     12 MONTHS                                           2001           2000
 
     TOTAL OPERATING REVENUES                  $1,570,048,000 $1,267,296,000
     NET INCOME (BEFORE PFD DIVDS)               $102,520,000    $95,659,000
     NET INCOME APPLICABLE TO
     COMMON STOCK                                 $98,820,000    $91,768,000
     AVERAGE SHARES OUTSTANDING                    34,883,000     36,295,000
     BASIC EARNINGS PER SHARE                           $2.83          $2.53
     ELECTRIC SALES (GWH):
      RETAIL                                            5,667          6,270
      LSEs                                              1,239            851
      OEUs                                              1,829          1,282
     GAS SALES (Mdt)                                   55,319         52,017
     HEATING DEGREE DAYS                                6,885          6,010
     COOLING DEGREE DAYS (3RD QTR 00/99)                  278            461
 
 
     SELECTED ABBREVIATIONS:
      GWH:       One thousand megawatt-hours of electric energy.
      LSEs:      Load serving entities or energy marketers.
      OEUs:      Other electric utilities.
      Mdt:       One thousand dekatherms or ten thousand therms.
 
 
                                 RGS Energy Group Inc.
                             Consolidated Statement of Income
                                 (Thousands of dollars)
                                      (Unaudited)
 
                           For the Three Months        For the Twelve Months
                                     Ended                       Ended
                                    March 31,                  March 31,
                               2001          2000         2001          2000
     OPERATING REVENUES
      Electric             $190,756      $179,784     $741,978      $717,864
      Gas                   166,425       119,568      386,872       286,671
      Other                 150,598        86,499      441,198       262,761
         Total Operating
           Revenues         507,779       385,851    1,570,048     1,267,296
 
     OPERATING EXPENSES
     Fuel Expenses
      Fuel for electric
       generation            12,549        10,963       50,437        48,743
      Purchased electricity  21,511        18,215       89,155        59,794
      Gas purchased for
       resale               113,486        63,937      258,136       154,674
      Unregulated fuel
       expenses             129,758        75,789      394,275       230,938
         Total Fuel
           Expenses         277,304       168,904      792,003       494,149
 
     Operating Revenues Less
      Fuel Expenses         230,475       216,947      778,045       773,147
 
     Other Operating Expenses
      Operations and maintenance
       excluding fuel        66,269        70,517      309,472       302,677
      Unregulated operating
       and maintenance expenses
       excluding fuel        11,869         7,385       35,609        27,157
      Depreciation and
       amortization          30,487        28,995      117,677       118,549
      Taxes - state, local
       and other             27,676        29,826       92,426       113,110
      Income taxes           30,611        26,568       64,524        67,156
         Total Other
      Operating Expenses    166,912       163,291      619,708       628,649
     Operating Income        63,563        53,656      158,337       144,498
 
     OTHER (INCOME) AND DEDUCTIONS
      Allowance for other funds used during
       construction           (238)         (191)        (873)         (619)
      Income taxes          (1,354)           445      (1,303)       (1,405)
      Other - net             3,191       (1,079)      (5,121)       (7,469)
         Total Other (Income)
           and Deductions     1,599         (825)      (7,297)       (9,493)
 
     INTEREST CHARGES
      Long term debt         14,157        14,465       57,736        54,995
      Other - net             1,886           980        6,773         4,329
      Allowance for borrowed
       funds used during
       construction           (382)         (306)      (1,395)         (992)
         Total Interest
          Charges            15,661        15,139       63,114        58,332
     Net Income              46,303        39,342      102,520        95,659
     Preferred Stock
     Dividend Requirements      925           925        3,700         3,891
     Net Income Applicable
      to Common Stock        45,378        38,417       98,820        91,768
 
     Average Number of
      Common Shares (000's)
      Common Stock           34,577        35,783       34,883        36,295
     Common Stock and
      Equivalents            34,879        35,803       35,079        36,405
 
     Earnings per Common
      Share - Basic           $1.31         $1.07        $2.83         $2.53
     Earnings per Common
      Share - Diluted         $1.30         $1.07        $2.82         $2.52
     Cash Dividends Paid
      per Common Share        $0.45         $0.45        $1.80         $1.80
 
 
                              RGS ENERGY GROUP, INC.
                            CONSOLIDATED BALANCE SHEET
                               (Thousand of Dollars)
 
 
                                                    March 31,   December 31,
                                                         2001           2000
     Assets                                       (Unaudited)
 
     Utility Plant
     Electric                                      $2,481,340     $2,467,289
     Gas                                              478,328        471,051
     Common                                           167,457        164,872
     Nuclear                                          292,430        292,588
                                                    3,419,555      3,395,800
     Less: Accumulated depreciation                 1,761,407      1,750,493
           Nuclear fuel amortization                  258,605        254,435
                                                    1,399,543      1,390,872
     Construction work in progress                    118,438        111,486
           Net Utility Plant                        1,517,981      1,502,358
 
     Current Assets
     Cash and cash equivalents                         22,963         16,258
     Accounts receivable, net of allowance
      for doubtful accounts:
      2001 - $34,648; 2000 - $34,550                  160,350        136,374
     Unbilled revenue receivable                       63,566         71,120
     Fuels                                             11,961         46,868
     Materials and supplies                             9,273          8,187
     Prepayments                                       35,539         26,268
     Other current assets                               3,358          2,292
         Total Current Assets                         307,010        307,367
 
     Intangible Assets
     Goodwill, net                                     27,706         27,971
     Other intangible assets, net                      22,096         22,614
         Total Intangible Assets                       49,802         50,585
 
     Deferred Debits and Other Assets
     Nuclear generating plant
      decommissioning fund                            234,551        244,514
     Nine Mile Two deferred costs                      26,892         27,155
     Unamortized debt expense                          16,199         16,602
     Other deferred debits                              4,336          4,674
     Regulatory assets                                389,874        411,212
     Other assets                                       1,546          1,331
         Total Deferred Debits and Other Assets       673,398        705,488
         Total Assets                              $2,548,191     $2,565,798
 
 
                              RGS ENERGY GROUP, INC.
                            CONSOLIDATED BALANCE SHEET
                               (Thousand of Dollars)
 
 
                                                    March 31,   December 31,
                                                         2001           2000
     Capitalization and Liabilities               (Unaudited)
 
     Capitalization
     Long term debt - mortgage bonds                 $580,148       $580,132
                    - promissory notes                241,010        243,728
     Preferred stock redeemable at option
      of RG&E                                          47,000         47,000
     Preferred stock subject to mandatory
      redemption                                       25,000         25,000
     Common shareholders' equity
     Common stock
       Authorized 100,000,000 shares; 38,956,726
        shares issued at March 31, 2001
        and 38,956,726 shares issued at
        December 31, 2000                             704,304        702,807
     Retained earnings                                211,395        181,546
                                                      915,699        884,353
     Less: Treasury stock at cost
             (4,379,300 shares at March 31, 2001
              and 4,379,300 shares at December 31,
              2000                                    117,238        117,238
           Total Common Shareholders' Equity          798,461        767,115
           Total Capitalization                     1,691,619      1,662,975
 
     Long Term Liabilities
     Nuclear waste disposal                            98,635         97,291
     Uranium enrichment decommissioning                 9,750          9,649
     Site remediation                                  24,528         24,420
                                                      132,913        131,360
 
     Current Liabilities
     Long term debt due within one year                12,105         12,095
     Short term debt                                   76,900        122,400
     Accounts payable                                  86,866        108,618
     Dividends payable                                 16,485         16,515
     Other                                             85,943         57,491
         Total Current Liabilities                    278,299        317,119
 
     Deferred Credits and Other Liabilities
     Accumulated deferred income taxes                275,029        277,787
     Pension costs accrued                             20,736         26,547
     Kamine deferred credit                            50,260         51,920
     Post employment benefits                          55,585         54,505
     Other                                             43,750         43,585
         Total Deferred Credits and Other
          Liabilities                                 445,360        454,344
 
         Total Capitalization and Liabilities      $2,548,191     $2,565,798
 
 
                               RGS ENERGY GROUP, INC.
                        CONSOLIDATED STATEMENT OF CASH FLOWS
                               (Thousands of Dollars)
                                    (Unaudited)
 
 
                                                        Three Months Ended
                                                         2001         2000 *
 
     CASH FLOW FROM OPERATING ACTIVITIES
     Net Income                                       $46,303        $39,342
     Adjustments to reconcile net income to
      net cash provided from operating activities:
     Depreciation & Amortization                       35,230         33,380
     Income taxes deferred                               (81)        (3,348)
     Changes in working capital, net                   15,662         38,793
     Other, net                                        13,758          8,742
         Total Operating                              110,871        116,909
 
 
     CASH FLOW FROM INVESTING ACTIVITIES
     Net additions to utility plant                  (32,438)       (26,771)
     Nuclear generating plant
      decommissioning fund                            (5,136)        (5,136)
     Acquisition, net of cash                              --        (1,296)
     Other, net                                       (1,723)              2
     Total Investing                                 (39,297)       (33,201)
 
 
     CASH FLOW FROM FINANCING ACTIVITIES
     Redemption of:
       Long term debt                                      --       (30,000)
     Repayment of promissory notes                      (990)          (919)
     Short term borrowings, net                      (45,500)          (500)
     Payments of dividends                           (16,485)       (17,078)
     Purchase of treasury stock                            --        (7,837)
     Other, net                                       (1,894)        (7,904)
         Total Financing                             (64,869)       (64,238)
         Increase in cash and cash equivalents          6,706         19,470
         Cash and cash equivalents at beginning of
           period                                      16,258          8,288
         Cash and cash equivalents at end of period   $22,964        $27,758
 
     * Reclassified for comparative purposes.
 
 
 
                       Rochester Gas and Electric Corporation
                                  Sales Statistics
 
                            For the Three Months        For the Twelve Months
                                     Ended                     Ended
                                   March 31,                  March 31,
 
                                        % Change                     % Change
                               2001     From 2000         2001     From 2000
 
     Electric-MWH
 
     Residential            543,170         -8.3%    2,104,685         -7.8%
     Commercial             400,859         -3.9%    1,663,769         -6.6%
     Industrial             340,940         -9.3%    1,522,537        -12.4%
     Municipal/Other         93,610        -14.0%      375,591        -19.6%
         Total Retail
          Sales           1,378,579         -7.7%    5,666,582         -9.6%
     Energy Marketers       354,226         41.8%    1,238,752         45.6%
     Other Electric
      Utilities             550,356         24.6%    1,829,413         42.7%
         Total Electric
           Sales          2,283,161          4.5%    8,734,747          3.9%
 
 
     Gas-Therms (000's)
 
     Residential            110,754        -10.2%      255,293         -1.2%
     Commercial              17,700        -11.2%       39,091         -5.4%
     Industrial               2,486         10.1%        4,424          6.6%
     Municipal                1,719        -29.2%        3,871        -23.2%
         Total Customer
          Sales             132,659        -10.3%      302,679         -2.0%
     Transportation of
      Customer Owned Gas     92,421         13.3%      250,508         18.6%
         Total Gas Sold and
          Transported       225,080         -1.9%      553,187          6.3%
 
                     MAKE YOUR OPINION COUNT -  Click Here
                http://tbutton.prnewswire.com/prn/11690X90867135
 
 

SOURCE RGS Energy Group, Inc.
    ROCHESTER, N.Y., April 24 /PRNewswire Interactive News Release/ --
 RGS Energy Group, Inc. (NYSE:   RGS) today reported higher earnings of
 $1.31 per common share for the first quarter ended March 31, 2001, as compared
 to $1.07 per common share for the same period in 2000.  First quarter 2001
 results were better than a year ago due primarily to increased wholesale
 electric revenues and a positive earnings contribution from its unregulated
 subsidiary, Energetix.  First quarter positive results were partially offset
 by electric and gas rate reductions, increased purchase power expenses and
 costs associated with the pending merger of RGS Energy and Energy East.  The
 Company completed its share buy-back program in the fourth quarter of 2000,
 which resulted in a reduction of average shares outstanding.
 
     First Quarter 2001 Results:
     First quarter 2001 operating revenues less fuel expenses were up
 $13.5 million compared to the prior year.  Electric revenues, net of fuel and
 purchase power expenses, increased by $6.1 million, reflecting $14.6 million
 in additional wholesale electric revenues driven by higher market prices and
 greater availability of generation, partially offset by lower electric rates
 and increased purchase power and fuel expenses.  Gas revenues, net of gas
 expenses, decreased by $2.7 million due largely to lower regulated gas
 distribution rates and decreased customer consumption in response to higher
 gas commodity prices, slightly offset by the positive effects of a colder
 first quarter of 2001.
     Unregulated revenues, net of fuel, from Griffith Energy, the liquid fuels
 business of Energetix, increased $10.1 million from the first quarter of 2000.
 Unregulated first quarter income is generally driven by the seasonal nature of
 Griffith's heating oil business. However, the first quarter of 2001 also
 reflects the first full quarter of operations after Griffith completed the
 acquisition of Burnwell Gas and certain assets of the New York Fuels Division
 of AllEnergy Marketing, that closed in November of 2000.  In addition to
 already being a profitable business, the Company expects that the liquid fuels
 business will provide an excellent platform for continued growth as
 deregulation evolves in New York State.
     Non-fuel expenses for the first quarter were up $6.6 million compared to
 the same period in 2000 due primarily to RGS Energy expenses related to the
 proposed merger with Energy East and increased unregulated operating expenses
 associated with the acquisitions by Energetix in 2000.
     Thomas S. Richards, Chairman, President and CEO stated that, "I am pleased
 with the performance of both our regulated and unregulated businesses in the
 quarter.  We combined good financial performance for our shareholders with
 reliable energy for our customers at reduced regulated rates for electric
 service and gas delivery service.  As RGS Energy and Energy East move forward
 in the merger process, we are committed to managing the transition to a
 restructured industry while creating benefits for our shareholders, customers
 and the upstate region."
 
     SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT
 OF 1995
     The foregoing contains forward-looking statements within the meaning of
 the "safe harbor" provisions of the United States Private Securities
 Litigation Reform Act of 1995.  Investors are cautioned that such forward-
 looking statements with respect to revenues, earnings, performance,
 strategies, prospects and other aspects of the businesses of RGS Energy and
 Energy East are based on current expectations that are subject to risks and
 uncertainties.  A number of factors could cause actual results or outcomes to
 differ materially from those indicated by such forward-looking statements.
 These factors include, but are not limited to, risks and uncertainties set
 forth in RGS Energy's and Energy East's filings with the SEC, including risks
 and uncertainties relating to: failure to obtain and retain expected synergies
 from the merger between RGS Energy and Energy East and the prior Energy East
 mergers, delays in obtaining or adverse conditions contained in any required
 regulatory approvals, changes in laws or regulations, economic or weather
 conditions affecting future sales and margins, changes in markets for
 electricity and natural gas, availability and pricing of fuel and other energy
 commodities, legislative and regulatory changes (including revised
 environmental and safety requirements), availability and cost of capital and
 other similar factors.  Readers are referred to RGS Energy's and Energy East's
 most recent reports filed with the SEC.
 
     ADDITIONAL INFORMATION AND WHERE TO FIND IT
     In connection with their proposed merger, RGS Energy and Energy East have
 filed a joint proxy statement/prospectus with the Securities and Exchange
 Commission.  INVESTORS AND SECURITY HOLDERS ARE ADVISED TO READ THE JOINT
 PROXY STATEMENT/PROSPECTUS, BECAUSE IT CONTAINS IMPORTANT INFORMATION.
 Investors and security holders may obtain a free copy of the joint proxy
 statement/prospectus and other documents filed by RGS Energy and Energy East
 with the Commission at the Commission's web site at http://www.sec.gov.  Free
 copies of the joint proxy statement/prospectus, and each company's other
 filings with the Commission may also be obtained from the respective
 companies.  Free copies of RGS Energy's filings may be obtained by directing a
 request to RGS Energy Group, Inc., 89 East Avenue, Rochester, NY 14649,
 Telephone: (800) 724-8833.   Free copies of Energy East's filings may be
 obtained by directing a request to Energy East Corporation, P.O. Box 3200,
 Ithaca, NY 14852-3200, Telephone: (800) 225-5643.
 
     PARTICIPANTS IN SOLICITATION
     RGS Energy Group, Inc., Energy East Corporation and their respective
 directors, executive officers and other members of their management and
 employees may be soliciting proxies from their respective stockholders in
 connection with the merger.  Information concerning RGS Energy's participants
 in the solicitation is set forth in RGS Energy's Current Report on Form 8-K
 filed with the Commission on February 20, 2001, and information concerning
 Energy East's participants in the solicitation is set forth in Energy East's
 Current Report on Form 8-K filed with the Commission on February 20, 2001.
 
 
                             RGS Energy Group, Inc.
                   HIGHLIGHTS- FOR THE PERIODS ENDED MARCH 31
     3 MONTHS                                            2001           2000
 
     TOTAL OPERATING REVENUES                    $507,779,000   $385,851,000
     NET INCOME (BEFORE PFD DIVDS)                $46,303,000    $39,342,000
     NET INCOME APPLICABLE TO
       COMMON STOCK                               $45,378,000    $38,417,000
     AVERAGE SHARES OUTSTANDING                    34,577,000     35,783,000
     BASIC EARNINGS PER SHARE                           $1.31          $1.07
     ELECTRIC SALES (GWH):
      RETAIL                                            1,379          1,494
      LSEs                                                354            250
      OEUs                                                550            441
     GAS SALES (Mdt)                                   22,508         22,947
     HEATING DEGREE DAYS                                3,267          3,025
 
 
     12 MONTHS                                           2001           2000
 
     TOTAL OPERATING REVENUES                  $1,570,048,000 $1,267,296,000
     NET INCOME (BEFORE PFD DIVDS)               $102,520,000    $95,659,000
     NET INCOME APPLICABLE TO
     COMMON STOCK                                 $98,820,000    $91,768,000
     AVERAGE SHARES OUTSTANDING                    34,883,000     36,295,000
     BASIC EARNINGS PER SHARE                           $2.83          $2.53
     ELECTRIC SALES (GWH):
      RETAIL                                            5,667          6,270
      LSEs                                              1,239            851
      OEUs                                              1,829          1,282
     GAS SALES (Mdt)                                   55,319         52,017
     HEATING DEGREE DAYS                                6,885          6,010
     COOLING DEGREE DAYS (3RD QTR 00/99)                  278            461
 
 
     SELECTED ABBREVIATIONS:
      GWH:       One thousand megawatt-hours of electric energy.
      LSEs:      Load serving entities or energy marketers.
      OEUs:      Other electric utilities.
      Mdt:       One thousand dekatherms or ten thousand therms.
 
 
                                 RGS Energy Group Inc.
                             Consolidated Statement of Income
                                 (Thousands of dollars)
                                      (Unaudited)
 
                           For the Three Months        For the Twelve Months
                                     Ended                       Ended
                                    March 31,                  March 31,
                               2001          2000         2001          2000
     OPERATING REVENUES
      Electric             $190,756      $179,784     $741,978      $717,864
      Gas                   166,425       119,568      386,872       286,671
      Other                 150,598        86,499      441,198       262,761
         Total Operating
           Revenues         507,779       385,851    1,570,048     1,267,296
 
     OPERATING EXPENSES
     Fuel Expenses
      Fuel for electric
       generation            12,549        10,963       50,437        48,743
      Purchased electricity  21,511        18,215       89,155        59,794
      Gas purchased for
       resale               113,486        63,937      258,136       154,674
      Unregulated fuel
       expenses             129,758        75,789      394,275       230,938
         Total Fuel
           Expenses         277,304       168,904      792,003       494,149
 
     Operating Revenues Less
      Fuel Expenses         230,475       216,947      778,045       773,147
 
     Other Operating Expenses
      Operations and maintenance
       excluding fuel        66,269        70,517      309,472       302,677
      Unregulated operating
       and maintenance expenses
       excluding fuel        11,869         7,385       35,609        27,157
      Depreciation and
       amortization          30,487        28,995      117,677       118,549
      Taxes - state, local
       and other             27,676        29,826       92,426       113,110
      Income taxes           30,611        26,568       64,524        67,156
         Total Other
      Operating Expenses    166,912       163,291      619,708       628,649
     Operating Income        63,563        53,656      158,337       144,498
 
     OTHER (INCOME) AND DEDUCTIONS
      Allowance for other funds used during
       construction           (238)         (191)        (873)         (619)
      Income taxes          (1,354)           445      (1,303)       (1,405)
      Other - net             3,191       (1,079)      (5,121)       (7,469)
         Total Other (Income)
           and Deductions     1,599         (825)      (7,297)       (9,493)
 
     INTEREST CHARGES
      Long term debt         14,157        14,465       57,736        54,995
      Other - net             1,886           980        6,773         4,329
      Allowance for borrowed
       funds used during
       construction           (382)         (306)      (1,395)         (992)
         Total Interest
          Charges            15,661        15,139       63,114        58,332
     Net Income              46,303        39,342      102,520        95,659
     Preferred Stock
     Dividend Requirements      925           925        3,700         3,891
     Net Income Applicable
      to Common Stock        45,378        38,417       98,820        91,768
 
     Average Number of
      Common Shares (000's)
      Common Stock           34,577        35,783       34,883        36,295
     Common Stock and
      Equivalents            34,879        35,803       35,079        36,405
 
     Earnings per Common
      Share - Basic           $1.31         $1.07        $2.83         $2.53
     Earnings per Common
      Share - Diluted         $1.30         $1.07        $2.82         $2.52
     Cash Dividends Paid
      per Common Share        $0.45         $0.45        $1.80         $1.80
 
 
                              RGS ENERGY GROUP, INC.
                            CONSOLIDATED BALANCE SHEET
                               (Thousand of Dollars)
 
 
                                                    March 31,   December 31,
                                                         2001           2000
     Assets                                       (Unaudited)
 
     Utility Plant
     Electric                                      $2,481,340     $2,467,289
     Gas                                              478,328        471,051
     Common                                           167,457        164,872
     Nuclear                                          292,430        292,588
                                                    3,419,555      3,395,800
     Less: Accumulated depreciation                 1,761,407      1,750,493
           Nuclear fuel amortization                  258,605        254,435
                                                    1,399,543      1,390,872
     Construction work in progress                    118,438        111,486
           Net Utility Plant                        1,517,981      1,502,358
 
     Current Assets
     Cash and cash equivalents                         22,963         16,258
     Accounts receivable, net of allowance
      for doubtful accounts:
      2001 - $34,648; 2000 - $34,550                  160,350        136,374
     Unbilled revenue receivable                       63,566         71,120
     Fuels                                             11,961         46,868
     Materials and supplies                             9,273          8,187
     Prepayments                                       35,539         26,268
     Other current assets                               3,358          2,292
         Total Current Assets                         307,010        307,367
 
     Intangible Assets
     Goodwill, net                                     27,706         27,971
     Other intangible assets, net                      22,096         22,614
         Total Intangible Assets                       49,802         50,585
 
     Deferred Debits and Other Assets
     Nuclear generating plant
      decommissioning fund                            234,551        244,514
     Nine Mile Two deferred costs                      26,892         27,155
     Unamortized debt expense                          16,199         16,602
     Other deferred debits                              4,336          4,674
     Regulatory assets                                389,874        411,212
     Other assets                                       1,546          1,331
         Total Deferred Debits and Other Assets       673,398        705,488
         Total Assets                              $2,548,191     $2,565,798
 
 
                              RGS ENERGY GROUP, INC.
                            CONSOLIDATED BALANCE SHEET
                               (Thousand of Dollars)
 
 
                                                    March 31,   December 31,
                                                         2001           2000
     Capitalization and Liabilities               (Unaudited)
 
     Capitalization
     Long term debt - mortgage bonds                 $580,148       $580,132
                    - promissory notes                241,010        243,728
     Preferred stock redeemable at option
      of RG&E                                          47,000         47,000
     Preferred stock subject to mandatory
      redemption                                       25,000         25,000
     Common shareholders' equity
     Common stock
       Authorized 100,000,000 shares; 38,956,726
        shares issued at March 31, 2001
        and 38,956,726 shares issued at
        December 31, 2000                             704,304        702,807
     Retained earnings                                211,395        181,546
                                                      915,699        884,353
     Less: Treasury stock at cost
             (4,379,300 shares at March 31, 2001
              and 4,379,300 shares at December 31,
              2000                                    117,238        117,238
           Total Common Shareholders' Equity          798,461        767,115
           Total Capitalization                     1,691,619      1,662,975
 
     Long Term Liabilities
     Nuclear waste disposal                            98,635         97,291
     Uranium enrichment decommissioning                 9,750          9,649
     Site remediation                                  24,528         24,420
                                                      132,913        131,360
 
     Current Liabilities
     Long term debt due within one year                12,105         12,095
     Short term debt                                   76,900        122,400
     Accounts payable                                  86,866        108,618
     Dividends payable                                 16,485         16,515
     Other                                             85,943         57,491
         Total Current Liabilities                    278,299        317,119
 
     Deferred Credits and Other Liabilities
     Accumulated deferred income taxes                275,029        277,787
     Pension costs accrued                             20,736         26,547
     Kamine deferred credit                            50,260         51,920
     Post employment benefits                          55,585         54,505
     Other                                             43,750         43,585
         Total Deferred Credits and Other
          Liabilities                                 445,360        454,344
 
         Total Capitalization and Liabilities      $2,548,191     $2,565,798
 
 
                               RGS ENERGY GROUP, INC.
                        CONSOLIDATED STATEMENT OF CASH FLOWS
                               (Thousands of Dollars)
                                    (Unaudited)
 
 
                                                        Three Months Ended
                                                         2001         2000 *
 
     CASH FLOW FROM OPERATING ACTIVITIES
     Net Income                                       $46,303        $39,342
     Adjustments to reconcile net income to
      net cash provided from operating activities:
     Depreciation & Amortization                       35,230         33,380
     Income taxes deferred                               (81)        (3,348)
     Changes in working capital, net                   15,662         38,793
     Other, net                                        13,758          8,742
         Total Operating                              110,871        116,909
 
 
     CASH FLOW FROM INVESTING ACTIVITIES
     Net additions to utility plant                  (32,438)       (26,771)
     Nuclear generating plant
      decommissioning fund                            (5,136)        (5,136)
     Acquisition, net of cash                              --        (1,296)
     Other, net                                       (1,723)              2
     Total Investing                                 (39,297)       (33,201)
 
 
     CASH FLOW FROM FINANCING ACTIVITIES
     Redemption of:
       Long term debt                                      --       (30,000)
     Repayment of promissory notes                      (990)          (919)
     Short term borrowings, net                      (45,500)          (500)
     Payments of dividends                           (16,485)       (17,078)
     Purchase of treasury stock                            --        (7,837)
     Other, net                                       (1,894)        (7,904)
         Total Financing                             (64,869)       (64,238)
         Increase in cash and cash equivalents          6,706         19,470
         Cash and cash equivalents at beginning of
           period                                      16,258          8,288
         Cash and cash equivalents at end of period   $22,964        $27,758
 
     * Reclassified for comparative purposes.
 
 
 
                       Rochester Gas and Electric Corporation
                                  Sales Statistics
 
                            For the Three Months        For the Twelve Months
                                     Ended                     Ended
                                   March 31,                  March 31,
 
                                        % Change                     % Change
                               2001     From 2000         2001     From 2000
 
     Electric-MWH
 
     Residential            543,170         -8.3%    2,104,685         -7.8%
     Commercial             400,859         -3.9%    1,663,769         -6.6%
     Industrial             340,940         -9.3%    1,522,537        -12.4%
     Municipal/Other         93,610        -14.0%      375,591        -19.6%
         Total Retail
          Sales           1,378,579         -7.7%    5,666,582         -9.6%
     Energy Marketers       354,226         41.8%    1,238,752         45.6%
     Other Electric
      Utilities             550,356         24.6%    1,829,413         42.7%
         Total Electric
           Sales          2,283,161          4.5%    8,734,747          3.9%
 
 
     Gas-Therms (000's)
 
     Residential            110,754        -10.2%      255,293         -1.2%
     Commercial              17,700        -11.2%       39,091         -5.4%
     Industrial               2,486         10.1%        4,424          6.6%
     Municipal                1,719        -29.2%        3,871        -23.2%
         Total Customer
          Sales             132,659        -10.3%      302,679         -2.0%
     Transportation of
      Customer Owned Gas     92,421         13.3%      250,508         18.6%
         Total Gas Sold and
          Transported       225,080         -1.9%      553,187          6.3%
 
                     MAKE YOUR OPINION COUNT -  Click Here
                http://tbutton.prnewswire.com/prn/11690X90867135
 
 SOURCE  RGS Energy Group, Inc.