Adopted November 9, 1939	 	File No. 69-306	
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.
FORM U-3A-2
Statement by Holding Company
Claiming Exemption under Rule U-3A-2
from the Provisions of the
Public Utility Holding Company Act of 1935
To Be Filed Annually Prior to March 1
Pinnacle West Capital Corporation

(Name of Company)
hereby files with the Securities and Exchange Commission, pursuant to Rule 2, its statement claiming exemption as a holding company from the provisions of the Public Utility Holding Company Act of 1935, and submits the following information:

 

1. Name, state of organization, location and nature of business of Claimant and every subsidiary thereof, other than any exempt wholesale generator (EWG) or foreign utility company in which Claimant directly or indirectly holds an interest.
     Pinnacle West Capital Corporation (“Claimant”), having been incorporated on February 20, 1985 under the laws of the State of Arizona and having its principal executive offices at 400 North Fifth Street, Phoenix, Arizona 85004, was organized principally to acquire and hold securities of other corporations for investment purposes. The following are the subsidiaries of the Claimant:
a. Arizona Public Service Company (“APS” or the “Company”) is engaged principally in serving electricity in the State of Arizona. Incorporated in 1920 under the laws of the State of Arizona and having its principal executive offices at 400 North Fifth Street, Phoenix, Arizona 85004, APS became a subsidiary of the Claimant pursuant to a corporate restructuring plan approved by the Company’s shareholders on April 18, 1985.
(1) AXIOM Power Solutions, Inc. (“AXIOM”) – an Arizona corporation, having been incorporated on October 29, 1996 and having its principal executive offices at 400 E. Van Buren, Phoenix, Arizona 85004, was organized primarily to sell security and energy management products and services. AXIOM is a wholly-owned subsidiary of APS.
(2) Bixco, Inc. (“Bixco”) – an Arizona corporation, having been incorporated on June 4, 1971 and having its principal executive offices at 400 North Fifth Street, Phoenix, Arizona 85004, was organized primarily to conduct exploration activities for energy resources and other valuable minerals. Subsequent to the sale of its oil and natural gas properties in 1981, Bixco has been inactive. Bixco is a wholly-owned subsidiary of APS.
(3) PWENewco, Inc. (“PWENewco”) – an Arizona corporation, having been incorporated on January 30, 2001 and having its principal executive offices at 400 North Fifth Street, Phoenix, Arizona 85004, was organized primarily to own real and personal property. PWENewco is a wholly-owned subsidiary of APS.
b. APSES Holdings, Inc. – a Delaware corporation, having been incorporated on March 24, 2003 and having its principal executive offices at 400 North Fifth Street, Phoenix, Arizona 85004, was organized as a holding company for APS Energy L.P.
(1) APS Energy L.P. – an Arizona limited partnership, having been formed on January 29, 2003 and having its principal
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executive offices at 400 North 5th Street, Phoenix, Arizona 85004 was organized to sell energy, products and services. APSES Holdings, Inc. holds a 99% interest in APS Energy L.P.
c. APS Energy Services Company, Inc. (“APSES”) – an Arizona corporation, having been incorporated on November 6, 1998 and having its principal executive offices at 400 E. Van Buren, Phoenix, Arizona 85004, was organized primarily to sell energy, products and services. APSES is a wholly-owned subsidiary of the Claimant.
(1) Northwind Phoenix LLC – a Delaware limited liability company, having been formed on December 14, 1999 and having its principal executive offices at 400 E. Van Buren, Phoenix, Arizona 85004, was organized primarily to provide district cooling services to customers in downtown Phoenix, Arizona. Northwind Phoenix LLC is a wholly-owned subsidiary of APSES.
(a) Tucson District Energy LLC – an Arizona limited liability corporation having been acquired by Northwind Phoenix LLC on May 31, 2001. Tucson District Energy LLC is a wholly-owned subsidiary of Northwind Phoenix LLC.
d. SunCor Development Company (“SunCor”) – an Arizona corporation, having been incorporated on June 30, 1965 and having its principal executive offices at 80 East Rio Salado Parkway, Tempe, Arizona 85281, is a wholly-owned subsidiary of Claimant engaged primarily in the owning, holding and development of real property.
(1) SunCor Golf, Inc. (“SunCor Golf”) – an Arizona corporation, having been incorporated on December 31, 1986 and having its principal executive offices at 80 East Rio Salado Parkway, Tempe, Arizona 85281, operates family fun parks, resorts and golf properties. SunCor Golf is a wholly-owned subsidiary of SunCor.
(a) Westworld Golf Course LLC – an Arizona limited liability company, having been formed on September 8, 1998 and having its principal executive offices at 80 East Rio Salado Parkway, Tempe, Arizona 85281, was organized to engage in golf course operations. Westworld Golf Course LLC is a wholly owned subsidiary of SunCor Golf, Inc.
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(2) Golden Heritage Homes, Inc. (“Golden Heritage Homes”) – an Arizona corporation, having been incorporated on May 14, 1986 and having its principal executive offices at 7025 East Greenway Parkway, Suite 100, Scottsdale, Arizona 85254, sells single family residential real property. Golden Heritage Homes is a wholly-owned subsidiary of SunCor.
(a) Golden Heritage Construction, Inc. (“GH Construction”) – an Arizona corporation, having been incorporated on December 30, 1993 and having its principal executive offices at 80 East Rio Salado Parkway, Tempe, Arizona 85281, was organized to serve as a general residential contractor. GH Construction became a wholly-owned subsidiary of Golden Heritage Homes, Inc. on January 1, 1996.
(b) Heritage Financial Services, LLC – an Arizona limited liability company, having been formed on August 19, 1998 and having its principal executive offices at 80 East Rio Salado Parkway, Tempe, Arizona 85281, was organized to provide mortgage services to residential home buyers. Heritage Financial Services, LLC is a wholly-owned subsidiary of Golden Heritage Homes, Inc.
(3) SCM, Inc. (“SCM”) – an Arizona corporation, having been incorporated on May 14, 1991 and having its principal executive offices at 80 East Rio Salado Parkway, Tempe, Arizona 85281, was organized to participate in real estate joint ventures and other real estate related activities. SCM is a wholly-owned subsidiary of SunCor and is currently inactive.
(4) SunCor Realty & Management Company (“SunCor Realty”) – an Arizona corporation, having been incorporated on April 1, 1994 and having its principal executive offices at 80 East Rio Salado Parkway, Tempe, Arizona 85281, was organized to participate in real estate management and other real estate related activities. SunCor Realty is a wholly-owned subsidiary of SunCor.
(5) Palm Valley Golf Club, Inc. (“Palm Valley Golf”) – an Arizona corporation, having been incorporated on January 23, 1996 and having its principal executive offices at 80 East Rio Salado Parkway, Tempe, Arizona 85281, was organized to hold title to the Palm Valley Golf Course located in Goodyear, Arizona. Palm Valley Golf is a wholly-owned subsidiary of SunCor.
(6) Rancho Viejo de Santa Fe, Inc. (“Rancho Viejo”) – a New Mexico corporation, having been incorporated on March 18, 1996
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and having its principal executive offices at 1590B Pacheco Street, Santa Fe, New Mexico 87502, was organized to engage in real estate development in New Mexico. Rancho Viejo is a wholly-owned subsidiary of SunCor.
(a) Ranchland Utility Company (“Ranchland”) – a New Mexico corporation, having been incorporated on September 5, 1997 and having its principal executive offices at 1590B Pacheco Street, Santa Fe, New Mexico 87502, is a waste-water utility. Ranchland is a wholly-owned subsidiary of Rancho Viejo.
(b) Rancho Viejo Village Center, LLC – a New Mexico limited liability company, having been formed on March 4, 2003 and having its principal executive offices at 1590B Pacheco Street, Santa Fe, New Mexico 87502, was organized to own and invest in real estate in New Mexico. Rancho Viejo Village Center, LLC is a wholly-owned subsidiary of Rancho Viejo.
(7) SunCor Idaho, LLC, formerly known as Spring Valley Development, LLC – an Idaho limited liability company, having been formed on July 22, 2003 and having its principal executive offices at 485 E. Riverside Drive, Suite 300, Eagle, Idaho 83616, was organized to engage in real estate development in Idaho. Spring Valley Development, LLC is a wholly-owned subsidiary of SunCor.
(8) Golf de Mexico, S.A. de C.V. (“Golf de Mexico”) – a Mexican variable capital corporation, having been incorporated on December 1, 1992 in Tijuana, Baja California, Mexico and having its principal executive offices at 80 East Rio Salado Parkway, Tempe, Arizona 85281, was organized to operate and manage the Real del Mar Golf Course in Mexico. Golf de Mexico has been inactive since 1997.
(9) Type Two, Inc. – an Arizona corporation, having been incorporated on March 29, 1990 and having its principal executive offices at 80 East Rio Salado Parkway, Tempe, Arizona 85281, was organized to hold and lease non-irrigation water rights. SunCor holds a 30% interest in Type Two Inc.
(10) Stone Ridge- Prescott Valley LLC – an Arizona limited liability company, having been formed on January 26, 2001 and having its principal executive offices at 80 East Rio Salado Parkway, Tempe, Arizona 85281, was organized to develop a master-planned community with golf course located in Prescott
5

 

Valley, Arizona. SunCor holds a 60% interest in Stone Ridge – Prescott Valley LLC.
(a) Stone Ridge Golf Course LLC – an Arizona limited liability company, having been formed on April 16, 2002 and having its principal executive offices at 80 East Rio Salado Parkway, Tempe, Arizona 85281, was organized to own and operate a golf course located in Prescott Valley, Arizona. Stone Ridge Golf Course LLC is a wholly-owned subsidiary of Stone Ridge-Prescott Valley LLC.
(11) Hayden Ferry Lakeside LLC – an Arizona limited liability company, having been formed on April 10, 2000 and having its principal executive offices at 80 East Rio Salado Parkway, Tempe, Arizona 85281, was organized to develop, manage and sell a mixed-use residential, office, hotel and retail commercial development in Tempe, Arizona. Hayden Ferry Lakeside LLC is a wholly-owned subsidiary of SunCor.
(a) Lakeside Residential Communities, L.L.C. – an Arizona limited liability company, having been formed on January 20, 2004 and having its principal executive offices at 80 East Rio Salado Parkway, Tempe, Arizona 85281, was organized to develop, manage and sell a residential condominium project. Lakeside Residential Communities, L.L.C. is a wholly-owned subsidiary of Hayden Ferry Lakeside LLC.
(i) Edgewater at Hayden Ferry Lakeside, L.L.C. – an Arizona limited liability company, having been formed on January 20, 2004 and having its principal executive offices at 80 East Rio Salado Parkway, Tempe, Arizona 85281, was organized to develop, manage and sell a residential condominium project. Edgewater at Hayden Ferry Lakeside, L.L.C. is a wholly-owned subsidiary of Lakeside Residential Communities, L.L.C.
(ii) BV at Hayden Ferry Lakeside, L.L.C. – an Arizona limited liability company, having been formed on January 20, 2004 and having its principal executive offices at 80 East Rio Salado Parkway, Tempe, Arizona 85281, was organized to develop, manage and sell a residential condominium project. BV at Hayden Ferry Lakeside, L.L.C. is a wholly-owned subsidiary of Lakeside Residential Communities, L.L.C.
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(12) Club West Golf Course LLC – an Arizona limited liability company, having been formed on August 28, 2000 and having its principal executive offices at 80 East Rio Salado Parkway, Tempe, Arizona 85281, was organized to own and operate Foothills Club West Golf Course in Phoenix, Arizona. SunCor holds a 68% interest in Club West Golf Course LLC.
(13) Scottsdale Mountain LLP – an Arizona limited liability partnership, having been formed on April 27, 1992 and having its principal executive offices at 80 East Rio Salado Parkway, Tempe, Arizona 85281, was organized to develop, manage and sell 1,389 acres in McDowell Mountain, Scottsdale, Arizona as a master-planned community. SunCor holds a 65% interest in Scottsdale Mountain LLP.
(14) SunRidge Canyon LLC – an Arizona limited liability company, having been formed on June 24, 1994 and having its principal executive offices at 80 East Rio Salado Parkway, Tempe, Arizona 85281, was organized to develop, manage and sell a 50 acre golf-oriented master planned community located in Scottsdale, Arizona. SunRidge Canyon LLC is a wholly-owned subsidiary of SunCor.
(15) Sedona Golf Resort LLC – an Arizona limited liability company, having been formed on February 6, 1995 and having its principal executive offices at 80 East Rio Salado Parkway, Tempe, Arizona 85281, was organized to develop, manage and sell a 300-acre golf oriented master-planned community in Sedona, Arizona. SunCor holds a 50% interest in Sedona Golf Resort LLC.
(16) Kabuto/SunCor Joint Venture – an Arizona general partnership, having been formed on October 15, 1990 and having its principal executive offices at 80 East Rio Salado Parkway, Tempe, Arizona 85281, was organized to develop and sell the village of Litchfield Greens, a residential community located in Litchfield Park, Arizona. SunCor holds a 70% interest in Kabuto/SunCor Joint Venture.
(17) Centrepoint Associates LLC – an Arizona limited liability company, having been formed on October 29, 1988 and having its principal executive offices at 80 East Rio Salado Parkway, Tempe, Arizona 85281, was organized to develop and manage a 60 acre commercial property as a shopping center on Elliot Road in Tempe, Arizona. SunCor holds a 50% interest in Centrepoint Associates LLC.
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(18) Hidden Hills of Scottsdale LLC – an Arizona limited liability company, having been formed on October 21, 1996 and having its principal executive offices at 80 East Rio Salado Parkway, Tempe, Arizona 85281, was organized to develop a single family residential area consisting of 320 acres located in Scottsdale, Arizona. Hidden Hills of Scottsdale LLC is a wholly-owned subsidiary of SunCor.
(19) Talavi Associates LLC – an Arizona limited liability company, having been formed on November 20, 1997 and having its principal executive offices at 80 East Rio Salado Parkway, Tempe, Arizona 85281, was organized to develop 33 acres located in Glendale, Arizona as an office and light industrial complex. SunCor holds a 50% interest in Talavi Associates LLC.
(20) Coral Canyon Town Center LLC – a Utah limited liability company, having been formed on April 19, 2002 and having its principal executive offices at 80 East Rio Salado Parkway, Tempe, Arizona 85281, was organized to develop and improve office property of an anticipated two story building located in Washington, Utah. SunCor holds a 75% interest in Coral Canyon Town Center LLC.
(21) Coral Canyon HD, L.L.C. – a Utah limited liability company, having been formed on February 4, 2004 and having its principal executive offices at c/o SunCor Development Company, 2303 North Coral Canyon Boulevard, Washington, Utah 84780, was organized to acquire, own, improve, develop, market, manage, operate, lease and sell real property in Washington, Utah. SunCor holds a 50% interest in Coral Canyon HD, L.L.C.
d. El Dorado Investment Company – an Arizona corporation, having been incorporated on July 27, 1983 and having its principal executive offices at 400 North 5th Street, MS 9988, Phoenix, Arizona 85004, is a wholly-owned subsidiary of Claimant engaged primarily in the acquisition and holding of stocks and securities of other companies for investment purposes.
(1) Underground Imaging Technologies, LLC – an Arizona limited liability corporation, having been formed on April 11, 2001 and having its principal executive offices at 1210 Vermeer Road East, Pella, Iowa 50219, was organized to develop subsurface imaging applications. El Dorado holds a 50% interest in Underground Imaging Technologies, LLC.
(2) NAC Holding Inc. – a Delaware corporation, having been incorporated on August 26, 1968 and having its principal executive offices at 3930 East Jones Bridge Road, Norcross, Georgia
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30092, was organized to provide a variety of services to the nuclear industry. El Dorado holds a 99.8% interest in NAC Holding Inc.
(a) NAC International Inc. – a Delaware corporation, having been incorporated on January 3, 1994 and having its principal executive offices at 3930 East Jones Bridge Road, Norcross, Georgia 30092, was organized to provide a variety of services to the nuclear industry. NAC International Inc. is a wholly-owned subsidiary of NAC Holding Inc.
(3) Phoenix Suns Limited Partnership – an Arizona limited partnership, having been formed on July 1, 1993 and having its principal executive offices at 201 East Jefferson Street, Phoenix, Arizona 85004, was organized to own a percentage interest in the Phoenix Suns professional basketball team. El Dorado holds a 21.7% interest in the Phoenix Suns Limited Partnership.
(4) AZ PB Partnership – an Arizona partnership, having been formed on June 26, 1995 and having its principal executive offices at 401 East Jefferson Street, Phoenix, Arizona 85004, was organized to own a percentage interest in a professional baseball team. El Dorado holds a 1.7% interest in AZ PB Partnership.
(5) El Dorado Ventures III – a California general partnership, formed on May 9, 1991 and having its principal executive offices at 2884 Sand Hill Road, Suite 121, Menlo Park, California 94025, was organized to invest in emerging companies with exceptional growth potential. El Dorado holds a 24.4% interest in El Dorado Ventures III.
(6) Phoenix Downtown Theater LLC – an Arizona limited liability company, formed on February 4, 1999 and having its principal executive offices at 2400 East Arizona Biltmore Circle, Suite 1270, Phoenix Arizona 85016, was organized to own and manage a theater. El Dorado owns a 6.9% interest in Phoenix Downtown Theater LLC.
(7) Nxt Phase – a Canadian company, having its principal executive offices at 3040 East Broadway, Vancouver, British Columbia V5M 1Z4, was organized to manufacture digital and fiber optic control and measurement devices for the power industry. El Dorado owns a 2.2% interest in Nxt Phase.
e. Pinnacle West Energy Corporation (“PWEC”) – an Arizona corporation, having been incorporated on September 27, 1999 and having its principal executive offices at 400 North Fifth Street, Phoenix, Arizona 85004, was organized primarily for the development, production and sale of wholesale energy. PWEC is a wholly-owned subsidiary of the Claimant.
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(1) GenWest, LLC – a Nevada limited liability corporation, formed on March 6, 2001 and having its principal executive offices at 400 North Fifth Street, Phoenix, Arizona 85004, was organized to own, build and operate power plants and participate in other activities which are necessary or advisable to accomplish the foregoing process. GenWest, LLC is a wholly-owned subsidiary of Pinnacle West Energy.
(2) APACS Holdings LLC – an Arizona limited liability corporation, formed on August 29, 2001 and having its principal executive offices at 400 North Fifth Street, Phoenix, Arizona 85004, was organized for a gas storage facility. APACS Holdings LLC is a wholly-owned subsidiary of Pinnacle West Energy.
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2. A brief description of the properties of Claimant and each of its subsidiary public utility companies used for the generation, transmission and distribution of electric energy for sale, or for the production, transmission and distribution of natural or manufactured gas, indicating the location of principal generating plants, transmission lines, producing fields, gas manufacturing plants and electric and gas distribution facilities, including all such properties which are outside the state in which Claimant and its subsidiaries are organized and all transmission or pipelines which deliver or receive electric energy or gas at the borders of such state.
     Neither the Claimant nor any of its subsidiaries own property used for the production, transmission and distribution of natural or manufactured gas at retail. APS and PWEC, each a “public utility company” as that term is defined in the Public Utility Holding Company Act of 1935, are the only two of Claimant’s subsidiaries that own property used for the generation, transmission and distribution of electric energy for sale.
     Exhibit C attached hereto shows the location of (i) APS’ major generating plants (including those owned jointly with others), principal transmission lines (including those operated for others) and interconnections of transmission lines with out-of-state utilities at state lines; and (ii) PWEC’s major generating plants. All of such facilities, except the Four Corners Generating Station (“Four Corners”), and all of APS’ distribution facilities, are located within the State of Arizona. Four Corners is a mine-mouth power plant, located in the northwest corner of New Mexico, near the city of Farmington, approximately 40 miles east of the Arizona-New Mexico border.
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Claimant’s present generating facilities have capacity as follows:
APS – Net Accredited Capacity
     APS’ present generating facilities have an accredited capacity as follows:

  	 	Capacity(kW)
	
Coal:	 	 	 	 	
Units 1, 2, and 3 at Four Corners	 	 	560,000	 	
15% owned Units 4 and 5 at Four Corners	 	 	222,000	 	
Units 1, 2, and 3 at Cholla Plant	 	 	615,000	 	
14% owned Units 1, 2, and 3 at the Navajo Plant	 	 	315,000	 	

 	 	 	1,712,000	 	

Gas or Oil:	 	 	 	 	
Two steam units at Ocotillo and two steam units at Saguaro	 	 	430,000	 	
Eleven combustion turbine units	 	 	493,000	 	
Three combined cycle units	 	 	255,000	 	

 	 	 	1,178,000	 	

Nuclear:	 	 	 	 	
29.1% owned or leased Units 1, 2, and 3 at Palo Verde	 	 	1,113,000	 	

Hydro and Solar	 	 	9,191	 	

Total APS facilities	 	 	4,012,191	 	

Pinnacle West Energy – Permitted Capacity
     PWEC’s present generating facilities have a permitted capacity as follows:

Gas or Oil:	 	 	 	 	
Two combined cycle units at Redhawk and two combined cycle units at West Phoenix	 	 	1,710,000	 	
One combustion turbine unit	 	 	80,000	 	

Total Pinnacle West Energy facilities	 	 	1,790,000	 	

     APS’ transmission facilities consist of approximately 4,955 pole miles of overhead lines and approximately 34 miles of underground lines, all of which are located within the State of Arizona. APS’ distribution facilities consist of approximately 12,118 pole miles of overhead lines and approximately 12,998 miles of underground lines, all of which are located within the State of Arizona.
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3. The following information for the last calendar year with respect to Claimant and each of its subsidiary public utility companies:
The following data excludes marketing and trading activities for non-public utility companies, interaffiliate transfers, and financial instruments and is not maintained in a format identifying the state in which the sales and purchases are made or the amount of their associated revenues or expenses.
      a. Number of kwh of electric energy sold (at retail or wholesale), and Mcf. of natural or manufactured gas distributed at retail.
35,877,401,000 kwh of electric energy sold at wholesale or retail
0 Mcf. of natural or manufactured gas distributed at retail
      b. Number of kwh of electric energy and Mcf. of natural or manufactured gas distributed at retail outside the state in which each such company is organized.
65,494,700 kwh of electric energy was distributed at retail outside Arizona
0 Mcf. of natural or manufactured gas distributed at retail outside Arizona
      c. Number of kwh of electric energy and Mcf. of natural or manufactured gas sold at wholesale outside the state in which each such company is organized, or at the state line.
6,811,664,000 kwh of electric energy was sold at wholesale outside Arizona or at state line
27,418,677 Mcf. of natural or manufactured gas sold at wholesale outside Arizona or at state line
      d. Number of kwh of electric energy and Mcf. of natural or manufactured gas purchased outside the state in which each such company is organized or at the state line.
6,852,001,000 kwh of electric energy was purchased outside Arizona or at state line
82,654,779 Mcf. of natural or manufactured gas purchased outside Arizona or at state line
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4. The following information for the reporting period with respect to Claimant and each interest it holds directly or indirectly in an EWG or a foreign utility company, stating monetary amounts in United States dollars:
      a. Name, location, business address and description of the facilities used by the EWG or foreign utility company for the generation, transmission and distribution of electric energy for sale or for the distribution at retail of natural or manufactured gas.
     GenWest, LLC is in the process of developing the Silverhawk Power Plant Project, which is a 570 MW combined-cycle plant located 20 miles north of Las Vegas, Nevada. The plant is currently under construction. The business address for the Silverhawk Power Plant is as follows:
GenWest, LLC
400 North Fifth Street, Mail Station 8983
Phoenix, Arizona 85004
Attention: Warren Kotzmann
      b. Name of each system company that holds an interest in such EWG or foreign utility company; and description of the interest held.
     GenWest, LLC is an EWG. It is wholly owned by Pinnacle West Energy Corporation, which in turn is a wholly owned subsidiary of the Claimant.
      c. Type and amount of capital invested, directly or indirectly, by the holding company claiming exemption; any direct or indirect guarantee of the security of the EWG or foreign utility company by the holding company claiming exemption; and any debt or other financial obligation for which there is recourse, directly or indirectly, to the holding company claiming exemption or another system company, other than the EWG or foreign utility company.

 	(1)	 	type and amount of capital invested, directly or indirectly, by the holding company:	
 	 	 	 	 	
$313,045,000	 	short-term debt (financed at Pinnacle West Capital Corporation)	
15,835,000	 	intercompany payables	
3,709,000	 	paid in capital (equity)	

$332,589,000	 	 	 	 	

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 	(2)	 	any direct or indirect guarantee of the security of the EWG or foreign utility company by the holding company claiming exemption:	
 	
 	 	 	none	
 	
 	(3)	 	any debt or other financial obligation for which there is recourse, directly or indirectly, to the holding company claiming exemption or another system company, other than the EWG or foreign utility company:	

 	(a)	 	Pinnacle West Energy guarantee up to $45,658,036 of GenWest performance under The Engineering Procurement and Construction Agreement for building the Silverhawk Power Plant.	
 	
 	(b)	 	Pinnacle West Capital Corporation guarantee of Pinnacle West Energy payment of $5,376,400 for the purchase of Construction Turbines.	
 	
 	(c)	 	Pinnacle West Energy , as assignor, remains liable for GenWest’s obligations under a Program Parts, Shop Repairs and Scheduled Outage Services Agreement for Combustion Turbines in the amount of $65,880,902.	
      d. Capitalization and earnings of the EWG or foreign utility company during the reporting period.

 	(1)	 	capitalization:	
 	 	 	 	 	
$313,045,000	 	short-term debt (financed at Pinnacle West Capital Corporation)	
3,709,000	 	paid in capital (equity)	

$316,754,000	 	 	 	 	

 	(2)	 	earnings:	
 	 	 	 	 	
$93,561	 	interest earnings	
(8,393)	 	other taxes	

$85,168	 	 	 	 	

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      e. Identify any service, sales or construction contract(s) between the EWG or foreign utility company and a system company, and describe the services to be rendered or goods sold and fees or revenues under such agreement(s).

 	(1)	 	Engineering, Procurement and Construction Agreement between GenWest, LLC and Arizona Public Service Company (“APS”) for construction of the Silverhawk Switchyard, pursuant to which, APS will construct the switchyard for the Silverhawk Power Plant. The contract price is $5,800,000.	
 	
 	(2)	 	Limited Liability Company Agreement of GenWest, LLC by and among Pinnacle West Energy Corporation as sole Member and Pinnacle West Energy Corporation in its capacity as the initial Manager of GenWest, LLC, dated February 27, 2001. PWEC made an initial capital contribution of $1,000. No other fees have been paid to date.	
 	
 	(3)	 	Contract for Services for Silverhawk SSR Study between GenWest, LLC and APS, pursuant to which APS will analyze potential sub-synchronous resonance at Silverhawk. The contract is a variable price contract with a not to exceed price of $15,000.	
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EXHIBIT A
      A consolidating statement of income and surplus of the Claimant and its subsidiary companies for the last calendar year, together with a consolidating balance sheet of Claimant and its subsidiary companies as of the close of such calendar year.
     Exhibit A hereto includes consolidating statements of income and consolidating balance sheets for the Claimant and the following of its subsidiaries: Arizona Public Service Company, SunCor Development Company, El Dorado Investment Company, APS Energy Services Company, Inc. and Pinnacle West Energy Corporation. Subsidiaries have been consolidated for financial reporting purposes in accordance with Statement of Financial Accounting Standards No. 94, Consolidation of All Majority-Owned Subsidiaries. Also included are consolidating statements of income and consolidating balance sheets for: SunCor Development Company and its subsidiaries, Pinnacle West Energy Corporation and its subsidiaries, APS Energy Services Company, Inc. and its subsidiaries, and El Dorado Investment Company and its subsidiaries.
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EXHIBIT B
      An organizational chart showing the relationship of each EWG or foreign utility company to associate companies in the holding-company system.
     Exhibit B hereto includes an organizational chart of the holding-company system, including each EWG.
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     The above-named Claimant has caused this statement to be duly executed on its behalf by its authorized officer on this 1st day of March, 2004.

 	Pinnacle West Capital Corporation
(Name of Claimant)
 	 	
 	By /s/ Barbara M. Gomez  	 	
 	Barbara M. Gomez 	 	
 	Treasurer 	 	
 	
[CORPORATE SEAL]

Attest:
 	 	 	
/s/ Betsy A. Pregulman  	 	 	
Betsy A. Pregulman 	 	 	
Associate Secretary 	 	 	
 	
     Name, title and address of officer to whom notices and correspondence concerning this statement should be addressed: 

Barbara M. Gomez	 	Vice President and Treasurer	

 	
(Name)	 	(Title)	
400 North Fifth Street, Station 9996, Phoenix, Arizona 85004

(Address)
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EXHIBIT A
PINNACLE WEST CAPITAL CORPORATION
CONSOLIDATING INCOME STATEMENT (dollars in thousands)
(UNAUDITED)

 	 	PINNACLE	 	 	 	 	 	PINNACLE	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
 	 	WEST	 	 	 	 	 	WEST	 	 	 	 	 	 	 	 	 	 	 	 	 	ELIMINATIONS &	 	 	
Year ended December 31, 2003
	 	PARENT
	 	APS
	 	ENERGY
	 	SUNCOR
	 	EL DORADO
	 	APS ES
	 	ADJUSTMENTS
	 	TOTAL
	
OPERATING REVENUES	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Regulated electricity segment	 	$	1	 	 	$	1,999,390	 	 	$	70,498	 	 	 	 	 	 	 	 	 	 	 	 	 	 	$	(91,814	)(a)	 	$	1,978,075	 	
Marketing and trading segment	 	 	97,016	 	 	 	105,541	 	 	 	13,110	 	 	 	 	 	 	 	 	 	 	 	197,711	 	 	 	(21,492	)(a)	 	 	391,886	 	
Real estate segment	 	 	 	 	 	 	 	 	 	 	 	 	 	 	361,604	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	361,604	 	
Other revenues	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	58,358	 	 	 	27,929	 	 	 	 	 	 	 	86,287	 	

 	 	 	 	

 	 	 	 	

 	 	
Total	 	 	97,017	 	 	 	2,104,931	 	 	 	83,608	 	 	 	361,604	 	 	 	58,358	 	 	 	225,640	 	 	 	(113,306	)	 	 	2,817,852	 	

 	 	 	 	

 	 	 	 	

 	 	
OPERATING EXPENSES	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Regulated electricity segment purchased power and fuel	 	 	6,086	 	 	 	606,251	 	 	 	(3,870	)	 	 	 	 	 	 	 	 	 	 	 	 	 	 	(91,147	)(a)	 	 	517,320	 	
Marketing and trading segment purchased power and fuel	 	 	91,960	 	 	 	97,180	 	 	 	4,810	 	 	 	 	 	 	 	 	 	 	 	161,695	 	 	 	(10,783	)(a)	 	 	344,862	 	
Operations and maintenance	 	 	(1,792	)	 	 	513,604	 	 	 	32,187	 	 	 	 	 	 	 	 	 	 	 	16,109	 	 	 	(11,376	)(a)	 	 	548,732	 	
Real estate operations segment	 	 	 	 	 	 	 	 	 	 	 	 	 	 	304,599	 	 	 	 	 	 	 	 	 	 	 	1,375	(b)	 	 	305,974	 	
Depreciation and amortization	 	 	6,046	 	 	 	389,240	 	 	 	33,020	 	 	 	5,305	 	 	 	3,003	 	 	 	1,529	 	 	 	 	 	 	 	438,143	 	
Taxes other than Income taxes	 	 	(22	)	 	 	108,852	 	 	 	1,413	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	27	(b)	 	 	110,270	 	
Other expenses	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	47,244	 	 	 	23,254	 	 	 	 	 	 	 	70,498	 	

 	 	 	 	

 	 	 	 	

 	 	
Total	 	 	102,278	 	 	 	1,715,127	 	 	 	67,560	 	 	 	309,904	 	 	 	50,247	 	 	 	202,587	 	 	 	(111,904	)	 	 	2,335,799	 	

 	 	 	 	

 	 	 	 	

 	 	
OPERATING INCOME	 	 	(5,261	)	 	 	389,804	 	 	 	16,048	 	 	 	51,700	 	 	 	8,111	 	 	 	23,053	 	 	 	(1,402	)	 	 	482,053	 	

 	 	 	 	

 	 	 	 	

 	 	
OTHER	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Allowance for equity funds used during construction	 	 	 	 	 	 	14,240	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	14,240	 	
Other income	 	 	275,705	 	 	 	20,277	 	 	 	196	 	 	 	25,414	 	 	 	559	 	 	 	 	 	 	 	(286,588	)(c)	 	 	35,563	 	
Other expenses	 	 	(5,743	)	 	 	(12,962	)	 	 	(1,202	)	 	 	 	 	 	 	(694	)	 	 	 	 	 	 	27	(b)	 	 	(20,574	)	

 	 	 	 	

 	 	 	 	

 	 	
Total	 	 	269,962	 	 	 	21,555	 	 	 	(1,006	)	 	 	25,414	 	 	 	(135	)	 	 	—	 	 	 	(286,561	)	 	 	29,229	 	

 	 	 	 	

 	 	 	 	

 	 	
INTEREST EXPENSE	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Interest charges	 	 	38,752	 	 	 	150,947	 	 	 	35,116	 	 	 	6,433	 	 	 	687	 	 	 	179	 	 	 	(27,524	)(c)	 	 	204,590	 	
Capitalized interest	 	 	1,244	 	 	 	(7,379	)	 	 	(17,863	)	 	 	(3,892	)	 	 	 	 	 	 	(179	)	 	 	(1,375	)(b)	 	 	(29,444	)	

 	 	 	 	

 	 	 	 	

 	 	
Total	 	 	39,996	 	 	 	143,568	 	 	 	17,253	 	 	 	2,541	 	 	 	687	 	 	 	—	 	 	 	(28,899	)	 	 	175,146	 	

 	 	 	 	

 	 	 	 	

 	 	
INCOME BEFORE INCOME TAXES	 	 	224,705	 	 	 	267,791	 	 	 	(2,211	)	 	 	74,573	 	 	 	7,289	 	 	 	23,053	 	 	 	(259,064	)	 	 	336,136	 	
INCOME TAXES	 	 	(15,874	)	 	 	86,854	 	 	 	(876	)	 	 	28,452	 	 	 	—	 	 	 	7,004	 	 	 	 	 	 	 	105,560	 	

 	 	 	 	

 	 	 	 	

 	 	
INCOME FROM CONTINUING OPERATIONS	 	 	240,579	 	 	 	180,937	 	 	 	(1,335	)	 	 	46,121	 	 	 	7,289	 	 	 	16,049	 	 	 	(259,064	)	 	 	230,576	 	
Income from discontinued operations — net of income taxes of $6,529	 	 	 	 	 	 	 	 	 	 	 	 	 	 	10,003	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	10,003	 	

 	 	 	 	

 	 	 	 	

 	 	
NET INCOME (LOSS)	 	$	240,579	 	 	$	180,937	 	 	$	(1,335	)	 	$	56,124	 	 	$	7,289	 	 	$	16,049	 	 	$	(259,064	)	 	$	240,579	 	

 	 	 	 	

 	 	 	 	

 	 	
EXPLANATIONS OF ELIMINATIONS AND ADJUSTMENTS
(a) Elimination of intercompany sales of electricity.
(b) Reclassification of certain expenses.
(c) Elimination of intercompany interest.
A1

 

PINNACLE WEST CAPITAL CORPORATION
CONSOLIDATING BALANCE SHEETS (dollars in thousands)
(UNAUDITED)

 	 	PINNACLE	 	 	 	 	 	PINNACLE	 	 	 	 	 	 	 	 	 	 	 	 	 	ELIMINATIONS &	 	 	
December 31, 2003
	 	WEST PARENT
	 	APS
	 	WEST ENERGY
	 	SUNCOR
	 	EL DORADO
	 	APS ES
	 	ADJUSTMENTS
	 	TOTAL
	
ASSETS	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
CURRENT ASSETS	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Cash and cash equivalents	 	$	81,725	 	 	$	112,002	 	 	$	1,298	 	 	$	25,885	 	 	$	5,871	 	 	$	1,998	 	 	$	—	 	 	$	228,779	 	
Customer and other receivables	 	 	608,442	 	 	 	258,424	 	 	 	57,395	 	 	 	16,987	 	 	 	12,181	 	 	 	42,722	 	 	 	(630,419	)(a)	 	 	365,732	 	
Allowance for doubtful accounts	 	 	(1,200	)	 	 	(3,743	)	 	 	 	 	 	 	 	 	 	 	 	 	 	 	(4,280	)	 	 	 	 	 	 	(9,223	)	
Accrued utility revenues	 	 	 	 	 	 	71,501	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	17,128	 	 	 	 	 	 	 	88,629	 	
Materials and supplies (at average cost)	 	 	 	 	 	 	80,682	 	 	 	15,417	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	96,099	 	
Fossil fuel (at average cost)	 	 	 	 	 	 	28,360	 	 	 	7	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	28,367	 	
Assets from risk management and trading activities	 	 	45,182	 	 	 	52,448	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	97,630	 	
Other current assets	 	 	2,442	 	 	 	6,969	 	 	 	4,812	 	 	 	34,174	 	 	 	511	 	 	 	672	 	 	 	23,454	(b)	 	 	73,034	 	

 	 	 	 	

 	 	 	 	

 	 	
Total current assets	 	 	736,591	 	 	 	606,643	 	 	 	78,929	 	 	 	77,046	 	 	 	18,563	 	 	 	58,240	 	 	 	(606,965	)	 	 	969,047	 	

 	 	 	 	

 	 	 	 	

 	 	
INVESTMENTS AND OTHER ASSETS	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Real estate investments — net	 	 	 	 	 	 	 	 	 	 	 	 	 	 	355,312	 	 	 	 	 	 	 	 	 	 	 	(11,990	)(b,c)	 	 	343,322	 	
Assets from risk management and trading activities — long term	 	 	120,945	 	 	 	18,001	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	138,946	 	
Decommissioning trust accounts	 	 	 	 	 	 	240,645	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	240,645	 	
Other assets	 	 	3,041,818	 	 	 	561,984	 	 	 	243	 	 	 	1,812	 	 	 	3,038	 	 	 	417	 	 	 	(3,520,496	)(a,b,d)	 	 	88,816	 	

 	 	 	 	

 	 	 	 	

 	 	
Total investments and other	 	 	3,162,763	 	 	 	820,630	 	 	 	243	 	 	 	357,124	 	 	 	3,038	 	 	 	417	 	 	 	(3,532,486	)	 	 	811,729	 	

 	 	 	 	

 	 	 	 	

 	 	
PROPERTY, PLANT AND EQUIPMENT	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Plant in service and held for future use	 	 	25,018	 	 	 	8,826,033	 	 	 	1,022,737	 	 	 	 	 	 	 	20,470	 	 	 	31,086	 	 	 	 	 	 	 	9,925,344	 	
Less accumulated depreciation and amortization	 	 	4,951	 	 	 	3,089,645	 	 	 	48,835	 	 	 	 	 	 	 	15,066	 	 	 	2,178	 	 	 	 	 	 	 	3,160,675	 	

 	 	 	 	

 	 	 	 	

 	 	
Total	 	 	20,067	 	 	 	5,736,388	 	 	 	973,902	 	 	 	—	 	 	 	5,404	 	 	 	28,908	 	 	 	—	 	 	 	6,764,669	 	
Construction work in progress	 	 	9,426	 	 	 	187,478	 	 	 	356,775	 	 	 	 	 	 	 	 	 	 	 	1,197	 	 	 	 	 	 	 	554,876	 	
Intangible assets, net of accumulated amortization	 	 	12,884	 	 	 	94,181	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	1,469	 	 	 	 	 	 	 	108,534	 	
Nuclear fuel, net of accumulated amortization	 	 	 	 	 	 	10,282	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	10,282	 	

 	 	 	 	

 	 	 	 	

 	 	
Net property, plant and equipment	 	 	42,377	 	 	 	6,028,329	 	 	 	1,330,677	 	 	 	—	 	 	 	5,404	 	 	 	31,574	 	 	 	—	 	 	 	7,438,361	 	

 	 	 	 	

 	 	 	 	

 	 	
DEFERRED DEBITS	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Regulatory assets	 	 	 	 	 	 	164,804	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	164,804	 	
Other deferred debits	 	 	 	 	 	 	92,853	 	 	 	12,846	 	 	 	5,055	 	 	 	 	 	 	 	 	 	 	 	(46	)(b)	 	 	110,708	 	

 	 	 	 	

 	 	 	 	

 	 	
Total deferred debits	 	 	—	 	 	 	257,657	 	 	 	12,846	 	 	 	5,055	 	 	 	—	 	 	 	—	 	 	 	(46	)	 	 	275,512	 	

 	 	 	 	

 	 	 	 	

 	 	
TOTAL ASSETS	 	$	3,941,731	 	 	$	7,713,259	 	 	$	1,422,695	 	 	$	439,225	 	 	$	27,005	 	 	$	90,231	 	 	$	(4,139,497	)	 	$	9,494,649	 	

 	 	 	 	

 	 	 	 	

 	 	
EXPLANATIONS OF ELIMINATIONS AND ADJUSTMENTS
(a) Elimination of inter-company receivables and payables.
(b) Miscellaneous reclassifications.
(c) Elimination of minority interests of SunCor joint venture partners.
(d) Elimination of parent company investments in subsidiaries.
A2

 

PINNACLE WEST CAPITAL CORPORATION
CONSOLIDATING BALANCE SHEETS (dollars in thousands)
(UNAUDITED)

 	 	PINNACLE	 	 	 	 	 	PINNACLE	 	 	 	 	 	 	 	 	 	 	 	 	 	ELIMINATIONS &	 	 	
December 31, 2003
	 	WEST PARENT
	 	APS
	 	WEST ENERGY
	 	SUNCOR
	 	EL DORADO
	 	APS ES
	 	ADJUSTMENTS
	 	TOTAL
	
LIABILITIES AND EQUITY	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
CURRENT LIABILITIES	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Accounts payable	 	$	68,845	 	 	$	131,383	 	 	$	52,403	 	 	$	21,235	 	 	$	10,384	 	 	$	9,177	 	 	 	 	 	 	$	293,427	 	
Accrued taxes	 	 	(1,487	)	 	 	90,474	 	 	 	(65,481	)	 	 	19,671	 	 	 	2,436	 	 	 	702	 	 	 	23,454	(b)	 	 	69,769	 	
Accrued interest	 	 	9,057	 	 	 	42,702	 	 	 	5,325	 	 	 	66	 	 	 	 	 	 	 	 	 	 	 	(5,325	)(a)	 	 	51,825	 	
Short-term borrowings	 	 	 	 	 	 	 	 	 	 	 	 	 	 	86,081	 	 	 	39,418	 	 	 	5,069	 	 	 	(44,487	)(a)	 	 	86,081	 	
Current maturities of long-term debt	 	 	215,845	 	 	 	206,727	 	 	 	 	 	 	 	2,002	 	 	 	906	 	 	 	 	 	 	 	 	 	 	 	425,480	 	
Customer deposits	 	 	 	 	 	 	45,481	 	 	 	 	 	 	 	4,302	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	49,783	 	
Deferred income taxes	 	 	 	 	 	 	631	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	631	 	
Liabilities from risk management and trading activities	 	 	34,617	 	 	 	58,138	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	92,755	 	
Other current liabilities	 	 	148,136	 	 	 	60,008	 	 	 	394,514	 	 	 	6,563	 	 	 	3,989	 	 	 	16,176	 	 	 	(548,163	)(a,b)	 	 	81,223	 	

 	 	 	 	

 	 	 	 	

 	 	
Total current liabilities	 	 	475,013	 	 	 	635,544	 	 	 	386,761	 	 	 	139,920	 	 	 	57,133	 	 	 	31,124	 	 	 	(574,521	)	 	 	1,150,974	 	

 	 	 	 	

 	 	 	 	

 	 	
NON-CURRENT LIABILITIES	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Long-term debt less current maturities	 	 	465,128	 	 	 	2,415,946	 	 	 	500,000	 	 	 	15,851	 	 	 	800	 	 	 	 	 	 	 	(500,000	)(a)	 	 	2,897,725	 	
DEFERRED CREDITS AND OTHER	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Liabilities from risk management and trading activities — long-term	 	 	78,228	 	 	 	4,502	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	82,730	 	
Deferred income taxes	 	 	19,045	 	 	 	1,248,397	 	 	 	62,594	 	 	 	 	 	 	 	 	 	 	 	(783	)	 	 	 	 	 	 	1,329,253	 	
Regulatory liabilities	 	 	 	 	 	 	468,694	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	468,694	 	
Unamortized gain-sale of utility plant	 	 	 	 	 	 	54,909	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	54,909	 	
Pension liability	 	 	21,402	 	 	 	160,639	 	 	 	(115	)	 	 	6,433	 	 	 	 	 	 	 	(318	)	 	 	 	 	 	 	188,041	 	
Liability for asset retirement	 	 	 	 	 	 	234,440	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	234,440	 	
Other	 	 	1,159	 	 	 	286,558	 	 	 	6	 	 	 	2,369	 	 	 	454	 	 	 	2	 	 	 	(32,444	)(b)	 	 	258,104	 	

 	 	 	 	

 	 	 	 	

 	 	
Total deferred credits	 	 	119,834	 	 	 	2,458,139	 	 	 	62,485	 	 	 	8,802	 	 	 	454	 	 	 	(1,099	)	 	 	(32,444	)	 	 	2,616,171	 	

 	 	 	 	

 	 	 	 	

 	 	
MINORITY INTERESTS	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Joint ventures of SunCor	 	 	 	 	 	 	 	 	 	 	 	 	 	 	15,119	 	 	 	 	 	 	 	 	 	 	 	(15,119	)(c)	 	 	—	 	

 	 	 	 	

 	 	 	 	

 	 	
COMMON STOCK EQUITY	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Common stock	 	 	2,217,455	 	 	 	1,424,966	 	 	 	478,560	 	 	 	235,054	 	 	 	14,046	 	 	 	48,217	 	 	 	(2,673,944	)(d)	 	 	1,744,354	 	

 	 	 	 	

 	 	 	 	

 	 	
Treasury Stock	 	 	(3,273	)	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	(3,273	)	

 	 	 	 	

 	 	 	 	

 	 	
Accumulated other comprehensive income (loss):	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Minimum pension liability adjustment	 	 	(9,406	)	 	 	(57,158	)	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	(66,564	)	
Derivative instruments	 	 	22,382	 	 	 	5,253	 	 	 	 	 	 	 	 	 	 	 	(72	)	 	 	 	 	 	 	 	 	 	 	27,563	 	

 	 	 	 	

 	 	 	 	

 	 	
Total accumulated other comprehensive income (loss)	 	 	12,976	 	 	 	(51,905	)	 	 	—	 	 	 	—	 	 	 	(72	)	 	 	—	 	 	 	—	 	 	 	(39,001	)	

 	 	 	 	

 	 	 	 	

 	 	
Retained earnings	 	 	654,598	 	 	 	830,569	 	 	 	(5,111	)	 	 	24,479	 	 	 	(45,356	)	 	 	11,989	 	 	 	(343,469	)(d)	 	 	1,127,699	 	

 	 	 	 	

 	 	 	 	

 	 	
Total common stock equity	 	 	2,881,756	 	 	 	2,203,630	 	 	 	473,449	 	 	 	259,533	 	 	 	(31,382	)	 	 	60,206	 	 	 	(3,017,413	)	 	 	2,829,779	 	

 	 	 	 	

 	 	 	 	

 	 	
TOTAL LIABILITIES AND EQUITY	 	$	3,941,731	 	 	$	7,713,259	 	 	$	1,422,695	 	 	$	439,225	 	 	$	27,005	 	 	$	90,231	 	 	$	(4,139,497	)	 	$	9,494,649	 	

 	 	 	 	

 	 	 	 	

 	 	
EXPLANATIONS OF ELIMINATIONS AND ADJUSTMENTS
(a) Elimination of intercompany receivables and payables.
(b) Miscellaneous reclassifications.
(c) Elimination of minority interests of SunCor joint venture partners.
(d) Elimination of parent company equity interest in subsidiaries.
A3

 

PINNACLE WEST ENERGY CORPORATION
CONSOLIDATING INCOME STATEMENT (dollars in thousands)
(Unaudited)

Year ended December 31, 2003
	 	PWEC
	 	GEN WEST
	 	ELIMINATIONS
	 	CONSOLIDATED
	
REVENUES	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Electric Revenue—Native Load	 	$	70,498	 	 	$	—	 	 	$	—	 	 	$	70,498	 	
Electric Revenue—Marketing & Trading	 	 	13,110	 	 	 	 	 	 	 	 	 	 	 	13,110	 	

 	 	 	 	

Total	 	 	83,608	 	 	 	—	 	 	 	—	 	 	 	83,608	 	

 	 	 	 	

COST OF REVENUES	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Fuel for Electric Generation—Native Load	 	 	(3,870	)	 	 	 	 	 	 	 	 	 	 	(3,870	)	
Fuel for Electric Generation—Marketing & Trading	 	 	4,810	 	 	 	 	 	 	 	 	 	 	 	4,810	 	

 	 	 	 	

Total	 	 	940	 	 	 	—	 	 	 	—	 	 	 	940	 	

 	 	 	 	

GROSS MARGIN	 	 	82,668	 	 	 	—	 	 	 	—	 	 	 	82,668	 	

 	 	 	 	

OTHER OPERATING EXPENSES (REVENUE)	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Operations and Maintenance	 	 	32,187	 	 	 	 	 	 	 	 	 	 	 	32,187	 	
Depreciation and Amortization	 	 	33,020	 	 	 	 	 	 	 	 	 	 	 	33,020	 	
Other Electric Revenues	 	 	(26	)	 	 	 	 	 	 	 	 	 	 	(26	)	
Other Taxes	 	 	1,405	 	 	 	8	 	 	 	 	 	 	 	1,413	 	

 	 	 	 	

Total	 	 	66,586	 	 	 	8	 	 	 	—	 	 	 	66,594	 	

 	 	 	 	

OPERATING MARGIN	 	 	16,082	 	 	 	(8	)	 	 	—	 	 	 	16,074	 	

 	 	 	 	

INTEREST AND OTHER EXPENSES	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Interest Expense	 	 	35,116	 	 	 	10,368	 	 	 	(10,368	)(a)	 	 	35,116	 	
Capitalized Interest	 	 	(7,495	)	 	 	(10,368	)	 	 	 	 	 	 	(17,863	)	
Other Interest & Dividend Income	 	 	(10,444	)	 	 	(94	)	 	 	10,368	(a)	 	 	(170	)	
Other Expenses	 	 	1,202	 	 	 	 	 	 	 	 	 	 	 	1,202	 	

 	 	 	 	

Total	 	 	18,379	 	 	 	(94	)	 	 	—	 	 	 	18,285	 	

 	 	 	 	

INCOME BEFORE INCOME TAXES	 	 	(2,297	)	 	 	86	 	 	 	—	 	 	 	(2,211	)	

 	 	 	 	

INCOME TAXES	 	 	(876	)	 	 	 	 	 	 	 	 	 	 	(876	)	

 	 	 	 	

NET INCOME	 	$	(1,421	)	 	$	86	 	 	$	—	 	 	$	(1,335	)	

 	 	 	 	

(a) Elimination of Intercompany interest.
A4

 

PINNACLE WEST ENERGY CORPORATION
CONSOLIDATING BALANCE SHEET (dollars in thousands)
(Unaudited)

December 31, 2003
	 	PWEC
	 	GEN WEST
	 	ELIMINATIONS
	 	CONSOLIDATED
	
ASSETS	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Current Assets	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Cash and cash equivalents	 	$	1,089	 	 	$	209	 	 	$	—	 	 	$	1,298	 	
Accounts receivable	 	 	824	 	 	 	172	 	 	 	 	 	 	 	996	 	
Intercompany receivable	 	 	344,300	 	 	 	357	 	 	 	(328,758	)(a)	 	 	15,899	 	
Other special deposits	 	 	40,500	 	 	 	 	 	 	 	 	 	 	 	40,500	 	
Materials and supplies (at average cost)	 	 	15,417	 	 	 	 	 	 	 	 	 	 	 	15,417	 	
Fossil fuel (at average cost)	 	 	7	 	 	 	 	 	 	 	 	 	 	 	7	 	
Other	 	 	4,812	 	 	 	 	 	 	 	 	 	 	 	4,812	 	

 	 	 	 	

Total Current Assets	 	 	406,949	 	 	 	738	 	 	 	(328,758	)	 	 	78,929	 	
Plant in Service	 	 	1,022,737	 	 	 	 	 	 	 	 	 	 	 	1,022,737	 	
Less accumulated depreciation and amortization	 	 	(48,835	)	 	 	 	 	 	 	 	 	 	 	(48,835	)	

 	 	 	 	

Total	 	 	973,902	 	 	 	—	 	 	 	—	 	 	 	973,902	 	
Construction Work in Progress	 	 	566	 	 	 	356,209	 	 	 	—	 	 	 	356,775	 	

 	 	 	 	

Utility Plant -Net	 	 	974,468	 	 	 	356,209	 	 	 	—	 	 	 	1,330,677	 	

Investments and Other Assets	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Investment in sub-Gen West	 	 	3,621	 	 	 	 	 	 	 	(3,621	)(b)	 	 	—	 	
Other Assets	 	 	243	 	 	 	 	 	 	 	 	 	 	 	243	 	
Deferred Debits	 	 	3,318	 	 	 	9,528	 	 	 	 	 	 	 	12,846	 	

 	 	 	 	

Total non-current assets	 	 	7,182	 	 	 	9,528	 	 	 	(3,621	)	 	 	13,089	 	

 	 	 	 	

TOTAL ASSETS	 	$	1,388,599	 	 	$	366,475	 	 	$	(332,379	)	 	$	1,422,695	 	

 	 	 	 	

LIABILITIES AND EQUITY	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Current Liabilities	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Accounts payable	 	$	18,519	 	 	$	33,884	 	 	$	—	 	 	$	52,403	 	
Intercompany payable	 	 	80,966	 	 	 	15,835	 	 	 	(15,713	)(a)	 	 	81,088	 	
Short term debt	 	 	313,045	 	 	 	313,045	 	 	 	(313,045	)(a)	 	 	313,045	 	
Accrued taxes	 	 	(65,483	)	 	 	2	 	 	 	 	 	 	 	(65,481	)	
Accrued interest	 	 	5,325	 	 	 	 	 	 	 	 	 	 	 	5,325	 	
Other	 	 	381	 	 	 	 	 	 	 	 	 	 	 	381	 	

 	 	 	 	

Total Current Liabilities	 	 	352,753	 	 	 	362,766	 	 	 	(328,758	)	 	 	386,761	 	
Deferred Credits	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Deferred income tax credit	 	 	62,594	 	 	 	 	 	 	 	 	 	 	 	62,594	 	
Other deferred credits	 	 	6	 	 	 	 	 	 	 	 	 	 	 	6	 	

 	 	 	 	

Total Deferred Credits	 	 	62,600	 	 	 	—	 	 	 	—	 	 	 	62,600	 	
Pension Liability	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Accumulated provision for SEBRP	 	 	274	 	 	 	 	 	 	 	 	 	 	 	274	 	
Deferred credits pension	 	 	(389	)	 	 	 	 	 	 	 	 	 	 	(389	)	

 	 	 	 	

Total Pension Liability	 	 	(115	)	 	 	—	 	 	 	—	 	 	 	(115	)	
Capitalization	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Additional paid in capital	 	 	478,560	 	 	 	3,621	 	 	 	(3,621	)(b)	 	 	478,560	 	
Retained earnings	 	 	(5,199	)	 	 	88	 	 	 	 	 	 	 	(5,111	)	
Long term debt to associated companies	 	 	500,000	 	 	 	 	 	 	 	 	 	 	 	500,000	 	

 	 	 	 	

Total Capitalization	 	 	973,361	 	 	 	3,709	 	 	 	(3,621	)	 	 	973,449	 	

 	 	 	 	

TOTAL LIABILITIES AND EQUITY	 	$	1,388,599	 	 	$	366,475	 	 	$	(332,379	)	 	$	1,422,695	 	

 	 	 	 	

(a) Elimination of intercompany receivables and payables.
(b) Elimination of parent company equity in subsidiaries.
A5 

 

SunCor Development Company
Consolidating Income Statement (dollars in thousands)
(Unaudited)

 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	PV	
year Ended December 31, 2003
	 	SUNCOR
	 	STONERIDGE
	 	CLUB WEST
	 	SANCTUARY
	 	SUNRIDGE
	 	COMMERCIAL
	 	HOME/DEV
	
Revenues	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Home Sales	 	$	—	 	 	$	27,923	 	 	$	—	 	 	$	—	 	 	$	—	 	 	$	—	 	 	$	50,485	 	
Land Sales	 	 	1,199	 	 	 	702	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	10,185	 	 	 	54,615	 	
Sale of Assets	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	45,000	 	 	 	44,095	 	
Commercial Properties	 	 	31	 	 	 	1,243	 	 	 	2,133	 	 	 	2,330	 	 	 	170	 	 	 	8,053	 	 	 	 	 	
Utility Sales	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Management Fees	 	 	533	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	438	 	 	 	 	 	

 	 	 	 	

 	 	 	 	

Total Operating Revenues	 	 	1,763	 	 	 	29,868	 	 	 	2,133	 	 	 	2,330	 	 	 	170	 	 	 	63,676	 	 	 	149,195	 	

 	 	 	 	

 	 	 	 	

Operating Expenses	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Cost of Homes Sold	 	 	(3,035	)	 	 	22,228	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	42,189	 	
Cost of Land Sold	 	 	3,700	 	 	 	480	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	5,756	 	 	 	28,652	 	
Sale of Assets	 	 	(6	)	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	34,353	 	 	 	29,818	 	
Commercial Properties	 	 	19	 	 	 	1,641	 	 	 	2,453	 	 	 	2,199	 	 	 	169	 	 	 	5,173	 	 	 	 	 	
Utility Expense	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Land Project Costs	 	 	575	 	 	 	1,042	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	887	 	 	 	1,373	 	
General & Administrative	 	 	16,159	 	 	 	2,499	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	1,782	 	 	 	4,682	 	
Depreciation & Amortization	 	 	1,351	 	 	 	278	 	 	 	213	 	 	 	346	 	 	 	 	 	 	 	2,621	 	 	 	54	 	
Minority Interest	 	 	1,007	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	

 	 	 	 	

 	 	 	 	

Total Operating Expenses	 	 	19,770	 	 	 	28,168	 	 	 	2,666	 	 	 	2,545	 	 	 	169	 	 	 	50,572	 	 	 	106,768	 	

 	 	 	 	

 	 	 	 	

Net Operating Income/(Loss)	 	 	(18,007	)	 	 	1,700	 	 	 	(533	)	 	 	(215	)	 	 	1	 	 	 	13,104	 	 	 	42,427	 	

 	 	 	 	

 	 	 	 	

Other Income and Gains	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Equity in Joint Ventures	 	 	237	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	472	 	 	 	2,611	 	
Interest Income	 	 	364	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	67	 	 	 	85	 	
Other	 	 	424	 	 	 	19	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	20,754	 	

 	 	 	 	

 	 	 	 	

Total Other Income and Gains	 	 	1,025	 	 	 	19	 	 	 	—	 	 	 	—	 	 	 	—	 	 	 	539	 	 	 	23,450	 	

 	 	 	 	

 	 	 	 	

Interest Expense, Net	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Interest Expense	 	 	2,932	 	 	 	361	 	 	 	352	 	 	 	240	 	 	 	 	 	 	 	318	 	 	 	1,029	 	
Less: Capitalized Interest	 	 	(1,629	)	 	 	(191	)	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	(1,029	)	

 	 	 	 	

 	 	 	 	

Total Interest Expense, Net	 	 	1,303	 	 	 	170	 	 	 	352	 	 	 	240	 	 	 	—	 	 	 	318	 	 	 	—	 	

 	 	 	 	

 	 	 	 	

 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	

 	 	 	 	

 	 	 	 	

 	 	
Income before Taxes & Disc Ops	 	 	(18,285	)	 	 	1,549	 	 	 	(885	)	 	 	(455	)	 	 	1	 	 	 	13,325	 	 	 	65,877	 	

 	 	 	 	

 	 	 	 	

Income Taxes	 	 	28,452	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	

 	 	 	 	

 	 	 	 	

Total Net Disc Ops	 	 	8,373	 	 	 	 	 	 	 	—	 	 	 	—	 	 	 	—	 	 	 	1,630	 	 	 	 	 	

 	 	 	 	

 	 	 	 	

Net Income/(Loss)	 	$	(38,364	)	 	$	1,549	 	 	$	(885	)	 	$	(455	)	 	$	1	 	 	$	14,955	 	 	$	65,877	 	

 	 	 	 	

 	 	 	 	

     
[Additional columns below]
[Continued from above table, first column(s) repeated]

  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	HIDDEN	 	CORAL	 	RANCHO	 	CONSOLIDATED	
year Ended December 31, 2003
	 	KABUTO JV
	 	SMLP
	 	PVGC
	 	NE HLBG
	 	HILLS
	 	CANYON
	 	VIEJO
	 	INCOME
	
Revenues	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Home Sales	 	$	—	 	 	 	 	 	 	$	—	 	 	$	47,849	 	 	 	 	 	 	$	14,834	 	 	$	31,023	 	 	$	172,114	 	
Land Sales	 	 	6,057	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	3,513	 	 	 	664	 	 	 	1,171	 	 	 	78,106	 	
Sale of Assets	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	110	 	 	 	 	 	 	 	89,205	 	
Commercial Properties	 	 	 	 	 	 	 	 	 	 	2,227	 	 	 	2,073	 	 	 	 	 	 	 	2,740	 	 	 	 	 	 	 	21,000	 	
Utility Sales	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	201	 	 	 	201	 	
Management Fees	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	7	 	 	 	 	 	 	 	978	 	

 	 	 	 	

 	 	 	 	

 	 	
Total Operating Revenues	 	 	6,057	 	 	 	—	 	 	 	2,227	 	 	 	49,922	 	 	 	3,513	 	 	 	18,355	 	 	 	32,395	 	 	 	361,604	 	

 	 	 	 	

 	 	 	 	

 	 	
Operating Expenses	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Cost of Homes Sold	 	 	 	 	 	 	 	 	 	 	 	 	 	 	36,124	 	 	 	3,035	 	 	 	11,787	 	 	 	25,498	 	 	 	137,826	 	
Cost of Land Sold	 	 	2,804	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	501	 	 	 	928	 	 	 	42,821	 	
Sale of Assets	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	97	 	 	 	 	 	 	 	64,262	 	
Commercial Properties	 	 	 	 	 	 	 	 	 	 	2,813	 	 	 	1,370	 	 	 	 	 	 	 	2,105	 	 	 	 	 	 	 	17,942	 	
Utility Expense	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	360	 	 	 	 	 	 	 	360	 	
Land Project Costs	 	 	 	 	 	 	21	 	 	 	 	 	 	 	294	 	 	 	 	 	 	 	417	 	 	 	323	 	 	 	4,932	 	
General & Administrative	 	 	367	 	 	 	22	 	 	 	 	 	 	 	4,841	 	 	 	 	 	 	 	1,944	 	 	 	3,194	 	 	 	35,490	 	
Depreciation & Amortization	 	 	 	 	 	 	 	 	 	 	 	 	 	 	38	 	 	 	 	 	 	 	391	 	 	 	13	 	 	 	5,305	 	
Minority Interest	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	(41	)	 	 	 	 	 	 	966	 	

 	 	 	 	

 	 	 	 	

 	 	
Total Operating Expenses	 	 	3,171	 	 	 	43	 	 	 	2,813	 	 	 	42,667	 	 	 	3,035	 	 	 	17,561	 	 	 	29,956	 	 	 	309,904	 	

 	 	 	 	

 	 	 	 	

 	 	
Net Operating Income/(Loss)	 	 	2,886	 	 	 	(43	)	 	 	(586	)	 	 	7,255	 	 	 	478	 	 	 	794	 	 	 	2,439	 	 	 	51,700	 	

 	 	 	 	

 	 	 	 	

 	 	
Other Income and Gains	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Equity in Joint Ventures	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	3,320	 	
Interest Income	 	 	 	 	 	 	1	 	 	 	 	 	 	 	2	 	 	 	 	 	 	 	152	 	 	 	4	 	 	 	675	 	
Other	 	 	 	 	 	 	13	 	 	 	 	 	 	 	45	 	 	 	 	 	 	 	118	 	 	 	46	 	 	 	21,419	 	

 	 	 	 	

 	 	 	 	

 	 	
Total Other Income and Gains	 	 	—	 	 	 	14	 	 	 	—	 	 	 	47	 	 	 	—	 	 	 	270	 	 	 	50	 	 	 	25,414	 	

 	 	 	 	

 	 	 	 	

 	 	
Interest Expense, Net	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Interest Expense	 	 	 	 	 	 	2	 	 	 	 	 	 	 	668	 	 	 	 	 	 	 	531	 	 	 	 	 	 	 	6,433	 	
Less: Capitalized Interest	 	 	 	 	 	 	 	 	 	 	 	 	 	 	(668	)	 	 	 	 	 	 	(375	)	 	 	 	 	 	 	(3,892	)	

 	 	 	 	

 	 	 	 	

 	 	
Total Interest Expense, Net	 	 	—	 	 	 	2	 	 	 	—	 	 	 	—	 	 	 	—	 	 	 	156	 	 	 	—	 	 	 	2,541	 	

 	 	 	 	

 	 	 	 	

 	 	

 	 	 	

 	 	 	 	

 	 	 	 	

Income before Taxes & Disc Ops	 	 	2,886	 	 	 	(31	)	 	 	(586	)	 	 	7,302	 	 	 	478	 	 	 	908	 	 	 	2,489	 	 	 	74,573	 	

 	 	 	 	

 	 	 	 	

 	 	
Income Taxes	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	28,452	 	

 	 	 	 	

 	 	 	 	

 	 	
Total Net Disc Ops	 	 	 	 	 	 	 	 	 	 	 	 	 	 	—	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	10,003	 	

 	 	 	 	

 	 	 	 	

 	 	
Net Income/(Loss)	 	$	2,886	 	 	$	(31	)	 	$	(586	)	 	$	7,302	 	 	$	478	 	 	$	908	 	 	$	2,489	 	 	$	56,124	 	

 	 	 	 	

 	 	 	 	

 	 	
A6 

 

SUNCOR DEVELOPMENT COMPANY
CONSOLIDATING BALANCE SHEETS (dollars in thousands)
(UNAUDITED)

December 31, 2003
	 	SUNCOR
	 	SMLP
	 	PVGC
	 	CLUB WEST
	 	SANCTUARY
	 	SUNRIDGE
	 	NE HB
	 	PV HB
	 	PV - DEV
	
ASSETS	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
CURRENT ASSETS	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Cash and cash equivalents	 	$	18,030	 	 	$	412	 	 	$	12	 	 	$	71	 	 	$	20	 	 	$	(31	)	 	$	(234	)	 	$	(399	)	 	$	(1,117	)	
Customer and other receivables	 	 	(7,258	)	 	 	766	 	 	 	30	 	 	 	14	 	 	 	56	 	 	 	16	 	 	 	286	 	 	 	33	 	 	 	20	 	
Other current assets	 	 	509	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	4,968	 	 	 	14,618	 	 	 	 	 	

 	 	 	 	

 	 	 	 	

 	 	 	 	
 	 	
Total current assets	 	 	11,281	 	 	 	1,178	 	 	 	42	 	 	 	85	 	 	 	76	 	 	 	(15	)	 	 	5,020	 	 	 	14,252	 	 	 	(1,097	)	

 	 	 	 	

 	 	 	 	

 	 	 	 	
 	 	
INVESTMENTS AND OTHER ASSETS	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Real estate investments—net	 	 	157,893	 	 	 	87	 	 	 	11,700	 	 	 	8,168	 	 	 	10,445	 	 	 	9,341	 	 	 	(19	)	 	 	839	 	 	 	103,589	 	
Other assets	 	 	1,123	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	

 	 	 	 	

 	 	 	 	

 	 	 	 	
 	 	
Total investments and other	 	 	159,016	 	 	 	87	 	 	 	11,700	 	 	 	8,168	 	 	 	10,445	 	 	 	9,341	 	 	 	(19	)	 	 	839	 	 	 	103,589	 	

 	 	 	 	

 	 	 	 	

 	 	 	 	
 	 	
DEFERRED DEBITS	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Other deferred debits	 	 	1,950	 	 	 	 	 	 	 	171	 	 	 	96	 	 	 	105	 	 	 	190	 	 	 	10	 	 	 	305	 	 	 	77	 	

 	 	 	 	

 	 	 	 	

 	 	 	 	
 	 	
TOTAL ASSETS	 	$	172,247	 	 	$	1,265	 	 	$	11,913	 	 	$	8,349	 	 	$	10,626	 	 	$	9,516	 	 	$	5,011	 	 	$	15,396	 	 	$	102,569	 	

 	 	 	 	

 	 	 	 	

 	 	 	 	
 	 	
LIABILITIES AND EQUITY	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
CURRENT LIABILITIES	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Accounts payable	 	$	7,857	 	 	$	—	 	 	$	389	 	 	$	231	 	 	$	2,394	 	 	$	517	 	 	$	2,888	 	 	$	13,601	 	 	$	(10,207	)	
Accrued taxes	 	 	19,671	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Accrued interest	 	 	(47	)	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	5,137	 	 	 	 	 	
Short-term borrowings	 	 	50,000	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	2,134	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Current maturities of long-term debt	 	 	 	 	 	 	 	 	 	 	146	 	 	 	223	 	 	 	26	 	 	 	1,511	 	 	 	 	 	 	 	 	 	 	 	 	 	
Customer deposits	 	 	41	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	1,867	 	 	 	876	 	 	 	 	 	
Other current liabilities	 	 	5,938	 	 	 	(2	)	 	 	7,021	 	 	 	107	 	 	 	157	 	 	 	 	 	 	 	(18,942	)	 	 	(22,329	)	 	 	246	 	

 	 	 	 	

 	 	 	 	

 	 	 	 	
 	 	
Total current liabilities	 	 	83,460	 	 	 	(2	)	 	 	7,556	 	 	 	561	 	 	 	4,711	 	 	 	2,028	 	 	 	(14,187	)	 	 	(2,715	)	 	 	(9,961	)	

 	 	 	 	

 	 	 	 	

 	 	 	 	
 	 	
NON-CURRENT LIABILITIES	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Long-term debt less current maturities	 	 	—	 	 	 	 	 	 	 	2,984	 	 	 	4,268	 	 	 	78	 	 	 	6,230	 	 	 	 	 	 	 	 	 	 	 	 	 	

 	 	 	 	

 	 	 	 	

 	 	 	 	
 	 	
DEFERRED CREDITS AND OTHER	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Pension liability	 	 	6,433	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Other	 	 	3,444	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	

 	 	 	 	

 	 	 	 	

 	 	 	 	
 	 	
Total deferred credits	 	 	9,877	 	 	 	—	 	 	 	—	 	 	 	—	 	 	 	—	 	 	 	—	 	 	 	—	 	 	 	—	 	 	 	—	 	

 	 	 	 	

 	 	 	 	

 	 	 	 	
 	 	
MINORITY INTERESTS	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Joint ventures of SunCor	 	 	—	 	 	 	—	 	 	 	—	 	 	 	—	 	 	 	—	 	 	 	—	 	 	 	—	 	 	 	—	 	 	 	—	 	

 	 	 	 	

 	 	 	 	

 	 	 	 	
 	 	
COMMON STOCK EQUITY	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Common stock	 	 	235,054	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Retained earnings	 	 	(156,144	)	 	 	1,267	 	 	 	1,373	 	 	 	3,520	 	 	 	5,837	 	 	 	1,258	 	 	 	19,198	 	 	 	18,111	 	 	 	112,530	 	

 	 	 	 	

 	 	 	 	

 	 	 	 	
 	 	
Total common stock equity	 	 	78,910	 	 	 	1,267	 	 	 	1,373	 	 	 	3,520	 	 	 	5,837	 	 	 	1,258	 	 	 	19,198	 	 	 	18,111	 	 	 	112,530	 	

 	 	 	 	

 	 	 	 	

 	 	 	 	
 	 	
TOTAL LIABILITIES AND EQUITY	 	$	172,247	 	 	$	1,265	 	 	$	11,913	 	 	$	8,349	 	 	$	10,626	 	 	$	9,516	 	 	$	5,011	 	 	$	15,396	 	 	$	102,569	 	

 	 	 	 	

 	 	 	 	

 	 	 	 	

     
[Additional columns below]
[Continued from above table, first column(s) repeated]

  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	ADJUSTMENTS &	 	 	
December 31, 2003
	 	KABUTO JV
	 	COMM.
	 	H HILLS
	 	STONERIDGE
	 	RANCHO VIEJO
	 	C. CANYON
	 	ELIMINATIONS
	 	CONSOLIDATED
	
ASSETS	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
CURRENT ASSETS	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Cash and cash equivalents	 	$	10,911	 	 	$	(750	)	 	$	161	 	 	$	272	 	 	$	215	 	 	$	(1,688	)	 	 	 	 	 	$	25,885	 	
Customer and other receivables	 	 	1,067	 	 	 	7,227	 	 	 	200	 	 	 	2,907	 	 	 	249	 	 	 	1,142	 	 	 	10,232	(a)	 	 	16,987	 	
Other current assets	 	 	 	 	 	 	 	 	 	 	 	 	 	 	5,999	 	 	 	4,280	 	 	 	4,878	 	 	 	(1,078	)(b)	 	 	34,174	 	

 	 	 	 	

 	 	 	 	

 	 	
Total current assets	 	 	11,978	 	 	 	6,477	 	 	 	361	 	 	 	9,178	 	 	 	4,744	 	 	 	4,332	 	 	 	9,154	 	 	 	77,046	 	

 	 	 	 	

 	 	 	 	

 	 	
INVESTMENTS AND OTHER ASSETS	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Real estate investments—net	 	 	6,866	 	 	 	107,362	 	 	 	13,780	 	 	 	26,409	 	 	 	21,284	 	 	 	27,170	 	 	 	(149,602	)(c)	 	 	355,312	 	
Other assets	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	689	 	 	 	 	 	 	 	—	 	 	 	1,812	 	

 	 	 	 	

 	 	 	 	

 	 	
Total investments and other	 	 	6,866	 	 	 	107,362	 	 	 	13,780	 	 	 	26,409	 	 	 	21,973	 	 	 	27,170	 	 	 	(149,602	)	 	 	357,124	 	

 	 	 	 	

 	 	 	 	

 	 	
DEFERRED DEBITS	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Other deferred debits	 	 	 	 	 	 	1,766	 	 	 	 	 	 	 	171	 	 	 	144	 	 	 	70	 	 	 	 	 	 	 	5,055	 	

 	 	 	 	

 	 	 	 	

 	 	
TOTAL ASSETS	 	$	18,844	 	 	$	115,605	 	 	$	14,141	 	 	$	35,758	 	 	$	26,861	 	 	$	31,572	 	 	$	(140,448	)	 	$	439,225	 	

 	 	 	 	

 	 	 	 	

 	 	
LIABILITIES AND EQUITY	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
CURRENT LIABILITIES	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Accounts payable	 	$	2,955	 	 	$	1,269	 	 	$	(1,768	)	 	$	2,315	 	 	$	668	 	 	$	578	 	 	$	(2,452	)(a)	 	 	21,235	 	
Accrued taxes	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	—	 	 	 	19,671	 	
Accrued interest	 	 	 	 	 	 	113	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	(5,137	)(a)	 	 	66	 	
Short-term borrowings	 	 	 	 	 	 	33,947	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	86,081	 	
Current maturities of long-term debt	 	 	 	 	 	 	 	 	 	 	 	 	 	 	58	 	 	 	 	 	 	 	38	 	 	 	 	 	 	 	2,002	 	
Customer deposits	 	 	 	 	 	 	211	 	 	 	 	 	 	 	1,032	 	 	 	275	 	 	 	 	 	 	 	 	 	 	 	4,302	 	
Other current liabilities	 	 	 	 	 	 	222	 	 	 	 	 	 	 	6,053	 	 	 	 	 	 	 	 	 	 	 	28,092	 	 	 	6,563	 	

 	 	 	 	

 	 	 	 	

 	 	
Total current liabilities	 	 	2,955	 	 	 	35,762	 	 	 	(1,768	)	 	 	9,458	 	 	 	943	 	 	 	616	 	 	 	20,503	 	 	 	139,920	 	

 	 	 	 	

 	 	 	 	

 	 	
NON-CURRENT LIABILITIES	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Long-term debt less current maturities	 	 	 	 	 	 	 	 	 	 	 	 	 	 	2,177	 	 	 	 	 	 	 	114	 	 	 	 	 	 	 	15,851	 	

 	 	 	 	

 	 	 	 	

 	 	
DEFERRED CREDITS AND OTHER	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Pension liability	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	6,433	 	
Other	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	(1,075	)(b)	 	 	2,369	 	

 	 	 	 	

 	 	 	 	

 	 	
Total deferred credits	 	 	—	 	 	 	—	 	 	 	—	 	 	 	—	 	 	 	—	 	 	 	—	 	 	 	(1,075	)	 	 	8,802	 	

 	 	 	 	

 	 	 	 	

 	 	
MINORITY INTERESTS	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Joint ventures of SunCor	 	 	—	 	 	 	—	 	 	 	—	 	 	 	—	 	 	 	—	 	 	 	128	 	 	 	14,991	 	 	 	15,119	 	

 	 	 	 	

 	 	 	 	

 	 	
COMMON STOCK EQUITY	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Common stock	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	235,054	 	
Retained earnings	 	 	15,889	 	 	 	79,843	 	 	 	15,909	 	 	 	24,123	 	 	 	25,918	 	 	 	30,714	 	 	 	(174,867	)(d)	 	 	24,479	 	

 	 	 	 	

 	 	 	 	

 	 	
Total common stock equity	 	 	15,889	 	 	 	79,843	 	 	 	15,909	 	 	 	24,123	 	 	 	25,918	 	 	 	30,714	 	 	 	(174,867	)	 	 	259,533	 	

 	 	 	 	

 	 	 	 	

 	 	
TOTAL LIABILITIES AND EQUITY	 	$	18,844	 	 	$	115,605	 	 	$	14,141	 	 	$	35,758	 	 	$	26,861	 	 	$	31,572	 	 	$	(140,448	)	 	$	439,225	 	

 	 	 	 	

 	 	 	 	

 	 	
EXPLANATIONS OF ELIMINATIONS AND ADJUSTMENTS
(a) Elimination of intercompany receivables and pavables.
(b) Miscellaneous reclassifications.
(c) Elimination of parent company investments in subsidiaries.
(d) Elimination of parent company equity in earnings of subsidiaries.
A7

 

EL DORADO INVESTMENT COMPANY
CONSOLIDATING INCOME STATEMENT (dollars in thousands)
(UNAUDITED)

 	 	 	 	 	 	 	 	 	 	Eliminations &	 	 	
year ended December 31, 2003
	 	El Dorado
	 	NAC
	 	Adjustments
	 	TOTAL YTD
	
REVENUES	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
NAC Revenue	 	$	—	 	 	$	58,358	 	 	$	—	 	 	$	58,358	 	
Equity in Earnings of Investees	 	 	5,017	 	 	 	—	 	 	 	(5,549	)(a)	 	 	(532	)	
Interest Income	 	 	2,312	 	 	 	—	 	 	 	(2,311	)(b)	 	 	1	 	
Gain (loss) on investment	 	 	510	 	 	 	—	 	 	 	 	 	 	 	510	 	
CMA Revenue	 	 	530	 	 	 	—	 	 	 	 	 	 	 	530	 	
Misc Income	 	 	50	 	 	 	—	 	 	 	 	 	 	 	50	 	

 	 	 	 	

Total	 	 	8,419	 	 	 	58,358	 	 	 	(7,860	)	 	 	58,917	 	

 	 	 	 	

OTHER EXPENSES AND DEDUCTIONS	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
NAC operating expenses	 	 	—	 	 	 	47,244	 	 	 	—	 	 	 	47,244	 	
Depreciation and amortization	 	 	—	 	 	 	3,003	 	 	 	—	 	 	 	3,003	 	
Interest expense and other	 	 	436	 	 	 	2,562	 	 	 	(2,311	)(b)	 	 	687	 	
General and administrative — net	 	 	694	 	 	 	—	 	 	 	 	 	 	 	694	 	

 	 	 	 	

Total	 	 	1,130	 	 	 	52,809	 	 	 	(2,311	)	 	 	51,628	 	

 	 	 	 	

INCOME BEFORE INCOME TAXES	 	 	7,289	 	 	 	5,549	 	 	 	(5,549	)	 	 	7,289	 	
INCOME TAXES	 	 	—	 	 	 	—	 	 	 	—	 	 	 	—	 	

 	 	 	 	

NET INCOME	 	$	7,289	 	 	$	5,549	 	 	$	(5,549	)	 	$	7,289	 	

 	 	 	 	

EXPLANATION OF ELIMINATIONS AND ADJUSTMENTS
(a) Elimination of equity in earnings of subsidiary.
(b) Elimination of intercompany interest income and expense.
A8

 

EL DORADO INVESTMENT COMPANY
CONSOLIDATING BALANCE SHEETS (dollars in thousands)
(UNAUDITED)

 	 	 	 	 	 	 	 	 	 	Eliminations &	 	 	
December 31, 2003
	 	El Dorado
	 	NAC
	 	Adjustments
	 	Total
	
ASSETS	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
CURRENT ASSETS	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Cash	 	$	4	 	 	$	5,867	 	 	$	—	 	 	$	5,871	 	
Accounts receivable	 	 	4,302	 	 	 	11,066	 	 	 	(3,187	)(a)	 	 	12,181	 	
Intercompany Loan Receivable -NAC	 	 	39,000	 	 	 		 	 	 	(39,000	)(a)	 	 	—	 	
Investment in NAC	 	 	(35,455	)	 	 	 	 	 	 	35,455	(b)	 	 	—	 	
Other Assets	 	 	126	 	 	 	385	 	 	 	—	 	 	 	511	 	

 	 	 	 	

Total Current Assets	 	 	7,977	 	 	 	17,318	 	 	 	(6,732	)	 	 	18,563	 	

 	 	 	 	

PROPERTY, PLANT AND EQUIPMENT	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Property, Plant and Equipment	 	 	 	 	 	 	20,470	 	 	 	 	 	 	 	20,470	 	
Less Accumulated Depreciation and amortization	 	 	 	 	 	 	(15,066	)	 	 	 	 	 	 	(15,066	)	

 	 	 	 	

Total Property, Plant and Equipment	 	 	—	 	 	 	5,404	 	 	 	—	 	 	 	5,404	 	

 	 	 	 	

INVESTMENTS AND OTHER ASSETS	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Other Assets	 	 	 	 	 	 	343	 	 	 	 	 	 	 	343	 	
Investments	 	 	2,695	 	 	 	 	 	 	 	 	 	 	 	2,695	 	

 	 	 	 	

Total investments and other	 	 	2,695	 	 	 	343	 	 	 	—	 	 	 	3,038	 	

 	 	 	 	

TOTAL ASSETS	 	$	10,672	 	 	$	23,065	 	 	$	(6,732	)	 	$	27,005	 	

 	 	 	 	

LIABILITIES AND EQUITY	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
CURRENT LIABILITIES	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Accounts payable and accrued liabilities	 	$	(22	)	 	$	13,593	 	 	$	(3,187	)(a)	 	$	10,384	 	
Current Maturities of LTD	 	 	 	 	 	 	906	 	 	 	 	 	 	 	906	 	
Accounts payable — PWCC	 	 	65	 	 	 	 	 	 	 	 	 	 	 	65	 	
Intercompany Loan Payable — El Dorado	 	 	 	 	 	 	39,000	 	 	 	(39,000	)(a)	 	 	—	 	
Intercompany Loan Payable — PWCC	 	 	39,418	 	 	 	 	 	 	 	 	 	 	 	39,418	 	
Deferred Income	 	 	63	 	 	 	3,861	 	 	 	 	 	 	 	3,924	 	
Taxes Payable	 	 	2,436	 	 	 	 	 	 	 	 	 	 	 	2,436	 	

 	 	 	 	

Total Current Liabilities	 	 	41,960	 	 	 	57,360	 	 	 	(42,187	)	 	 	57,133	 	

 	 	 	 	

NON-CURRENT LIABILITIES	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Long-term debt less current maturities	 	 	 	 	 	 	800	 	 	 	 	 	 	 	800	 	
Other	 	 	 	 	 	 	454	 	 	 	 	 	 	 	454	 	

 	 	 	 	

Total Non-Current Liabilities	 	 	—	 	 	 	1,254	 	 	 	—	 	 	 	1,254	 	

 	 	 	 	

Equity Common stock	 	 	10	 	 	 	10,634	 	 	 	(10,634	)(b)	 	 	10	 	
Additional paid in capital	 	 	14,036	 	 	 	12,613	 	 	 	(12,613	)(b)	 	 	14,036	 	
Retained earnings	 	 	(45,356	)	 	 	(58,702	)	 	 	58,702	(b)	 	 	(45,356	)	
Accumulated Other Comprehensive Income	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Derivative Instruments	 	 	22	 	 	 	(94	)	 	 	 	 	 	 	(72	)	

 	 	 	 	

Total equity	 	 	(31,288	)	 	 	(35,549	)	 	 	35,455	 	 	 	(31,382	)	

 	 	 	 	

TOTAL LIABILITIES AND EQUITY	 	$	10,672	 	 	$	23,065	 	 	$	(6,732	)	 	$	27,005	 	

 	 	 	 	

EXPLANATION OF ELIMINATIONS AND ADJUSTMENTS
(a) Elimination of intercompany receivables and payables.
(b) Elimination of investments in subsidiary.
A9

 

APS ENERGY SERVICES
CONSOLIDATING INCOME STATEMENT (dollars in thousands)
(Unaudited)

year ended December 31, 2003
	 	APSES
	 	Northwind
	 	Eliminations
	 	Total
	
OPERATING REVENUES	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
ELECTRIC SALES	 	$	197,711	 	 	$	—	 	 	$	—	 	 	$	197,711	 	
PRODUCTS & SERVICES	 	 	25,111	 	 	 	—	 	 	 	(2,316	)(a)	 	 	22,795	 	
NORTHWIND LLC.	 	 	—	 	 	 	5,008	 	 	 	—	 	 	 	5,008	 	
OTHER	 	 	150	 	 	 	—	 	 	 	(24	)(a)	 	 	126	 	

 	 	 	 	

TOTAL	 	 	222,972	 	 	 	5,008	 	 	 	(2,340	)	 	 	225,640	 	

 	 	 	 	

OPERATING EXPENSES	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
ELECTRIC SALES	 	 	161,695	 	 	 	—	 	 	 	—	 	 	 	161,695	 	
PRODUCTS & SERVICES	 	 	22,901	 	 	 	—	 	 	 	(2,316	)(a)	 	 	20,585	 	
NORTHWIND LLC.	 	 	—	 	 	 	2,568	 	 	 	—	 	 	 	2,568	 	
OTHER	 	 	101	 	 	 	—	 	 	 	—	 	 	 	101	 	

 	 	 	 	

TOTAL	 	 	184,697	 	 	 	2,568	 	 	 	(2,316	)	 	 	184,949	 	

 	 	 	 	

GROSS MARGIN	 	 	38,275	 	 	 	2,440	 	 	 	(24	)	 	 	40,691	 	

 	 	 	 	

OTHER OPERATING EXPENSES	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
LABOR	 	 	10,446	 	 	 	1,015	 	 	 	—	 	 	 	11,461	 	
OTHER O&M	 	 	3,200	 	 	 	1,448	 	 	 	—	 	 	 	4,648	 	
DEPRECIATION AND AMORTIZATION	 	 	701	 	 	 	828	 	 	 	—	 	 	 	1,529	 	

 	 	 	 	

TOTAL	 	 	14,347	 	 	 	3,291	 	 	 	—	 	 	 	17,638	 	

 	 	 	 	

OPERATING INCOME	 	 	23,928	 	 	 	(851	)	 	 	(24	)	 	 	23,053	 	

 	 	 	 	

INTEREST AND OTHER EXPENSES	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
INTEREST ON LONG-TERM DEBT	 	 	179	 	 	 	24	 	 	 	(24	)(a)	 	 	179	 	
CAPITALIZED INTEREST	 	 	(155	)	 	 	(24	)	 	 	—	 	 	 	(179	)	
(GAIN)/ LOSS IN NORTHWIND LLC	 	 	851	 	 	 	—	 	 	 	(851	)(b)	 	 	—	 	

 	 	 	 	

TOTAL	 	 	875	 	 	 	—	 	 	 	(875	)	 	 	—	 	

 	 	 	 	

INCOME BEFORE INCOME TAXES	 	 	23,053	 	 	 	(851	)	 	 	851	 	 	 	23,053	 	
INCOME TAXES	 	 	7,004	 	 	 	—	 	 	 	—	 	 	 	7,004	 	

 	 	 	 	

NET INCOME	 	$	16,049	 	 	$	(851	)	 	$	851	 	 	$	16,049	 	

 	 	 	 	

(a) Elimination of intercompany revenues and associated costs.
(b) Elimination of equity of earnings of subsidiary.
A10

 

APS ENERGY SERVICES
CONSOLIDATING BALANCE SHEET (dollars in thousands)
(Unaudited)

December 31, 2003
	 	APSES
	 	Northwind
	 	Eliminations
	 	Total
	
ASSETS	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
CURRENT ASSETS	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
CASH	 	$	1,696	 	 	$	302	 	 	 	 	 	 	$	1,998	 	
CUSTOMER & OTHER RECEIVABLES	 	 	53,651	 	 	 	973	 	 	 	(11,902	)(a)	 	 	42,722	 	
ALLOWANCE FOR DOUBTFUL ACCOUNTS	 	 	(4,280	)	 	 	—	 	 	 	 	 	 	 	(4,280	)	
ACCRUED REVENUE	 	 	17,128	 	 	 	—	 	 	 	 	 	 	 	17,128	 	
OTHER CURRENT ASSETS	 	 	783	 	 	 	—	 	 	 	(111	)(a)	 	 	672	 	

 	 	 	 	

TOTAL CURRENT ASSETS	 	 	68,978	 	 	 	1,275	 	 	 	(12,013	)	 	 	58,240	 	

 	 	 	 	

INVESTMENTS	 	 	16,248	 	 	 	—	 	 	 	(15,831	)(b)	 	 	417	 	

 	 	 	 	

PROPERTY, PLANT & EQUIPMENT	 	 	1,001	 	 	 	30,085	 	 	 	 	 	 	 	31,086	 	
LESS ACCUMULATED DEPRECIATION & AMORTIZATION	 	 	(660	)	 	 	(1,518	)	 	 	 	 	 	 	(2,178	)	

 	 	 	 	

TOTAL	 	 	341	 	 	 	28,567	 	 	 	 	 	 	 	28,908	 	
CONSTRUCTION WORK IN PROGRESS	 	 	1,099	 	 	 	98	 	 	 	 	 	 	 	1,197	 	
INTANGIBLE ASSETS, NET OF AMORTIZATION	 	 	1,469	 	 	 	—	 	 	 	 	 	 	 	1,469	 	

 	 	 	 	

TOTAL PROPERTY — NET	 	 	2,909	 	 	 	28,665	 	 	 	 	 	 	 	31,574	 	

 	 	 	 	

TOTAL ASSETS	 	$	88,135	 	 	$	29,940	 	 	$	(27,844	)	 	$	90,231	 	

 	 	 	 	

CURRENT LIABILITIES	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
ACCOUNTS PAYABLE	 	$	7,104	 	 	$	2,073	 	 	 	 	 	 	$	9,177	 	
ACCRUED TAXES PAYABLE	 	 	679	 	 	 	23	 	 	 	 	 	 	 	702	 	
SHORT TERM DEBT	 	 	5,069	 	 	 	134	 	 	 	(134	)(a)	 	 	5,069	 	
OTHER CURRENT LIABILITIES	 	 	16,176	 	 	 	11,878	 	 	 	(11,878	)(a)	 	 	16,176	 	

 	 	 	 	

TOTAL CURRENT LIABILITIES	 	 	29,028	 	 	 	14,108	 	 	 	(12,012	)	 	 	31,124	 	

 	 	 	 	

DEFERRED INCOME TAXES	 	 	(783	)	 	 	—	 	 	 	 	 	 	 	(783	)	
OTHER DEFERRED CREDITS	 	 	2	 	 	 	—	 	 	 	 	 	 	 	2	 	
PENSION LIABILITY	 	 	(318	)	 	 	—	 	 	 	 	 	 	 	(318	)	

 	 	 	 	

TOTAL NON-CURRENT LIABILITIES	 	 	(1,099	)	 	 	—	 	 	 	—	 	 	 	(1,099	)	

 	 	 	 	

EQUITY & LIABILITIES	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
COMMON STOCK	 	 	1	 	 	 	—	 	 	 	 	 	 	 	1	 	
EQUITY	 	 	48,216	 	 	 	16,683	 	 	 	(16,683	)(b)	 	 	48,216	 	
RETAINED EARNINGS	 	 	11,989	 	 	 	(851	)	 	 	851	(b)	 	 	11,989	 	

 	 	 	 	

TOTAL EQUITY	 	 	60,206	 	 	 	15,832	 	 	 	(15,832	)	 	 	60,206	 	

 	 	 	 	

TOTAL LIABILITIES & EQUITY	 	$	88,135	 	 	$	29,940	 	 	$	(27,844	)	 	$	90,231	 	

 	 	 	 	

(a)Elimination of intercompany receivables and payables.
(b)Elimination of investment in subsidiary.
A11

 

EXHIBIT B 

PINNACLE WEST CAPITAL CORPORATION & SUBSIDIARIES ORGANIZATIONAL CHART Kabuto SunCor Joint Venture APS Energy Services Company Inc. 100% Arizona Public Service Company 100% Northwind Phoenix LLC 100% 100% Axiom Power Solutions, Inc. Bixco, Inc. 100% 50% Talavi Associates LLC 100% Hidden Hills of Scottsdale LLC 50% Centrepoint Associates LLC 50% Sedona Golf Resort LLC 100% SunRidge Canyon LLC 65% Scottsdale Mountain LLP 100% Golf de Mexico, S.A. de C.V. Type Two, Inc. 30% SunCor Development Company 100% 100% 100% Heritage Financial Services, LLC Golden Heritage Homes, Inc. 100% Golden Heritage Construction Inc. 100% Palm Valley Golf Club, Inc. 100% SunCor Golf, Inc. 100% Westworld Golf Course LLC 100% Rancho Viejo de Santa Fe, Inc. 100% SCM, Inc. 100% 100% SunCor Realty & Management Company 70% 60% Stone Ridge - Prescott Valley LLC El Dorado Investment Company 100% Tucson District Energy LLC 100% 100% PWENewco, Inc. 100% Hayden Ferry Lakeside LLC 68% Club West Golf Course LLC Stone Ridge Golf Course LLC Pinnacle West Capital Corporation 100% Coral Canyon Town Center LLC 75% SunCor Idaho, LLC 100% Ranchland Utility Company Rancho Viejo Village Center, LLC 100% Pinnacle West Energy Corporation 100% 100% Gen West, LLC APACS Holdings LLC 100% AZ PB Partnership 1.7% Phoenix Suns Limited Partnership 21.7% El Dorado Ventures III 24.4% Phoenix Downtown Theater LLC 6.9% Underground Imaging Technologies, LLC 50% 99.8% 100% NAC Holding Inc. NAC International Inc. APSES Holdings, Inc. 100% APS Energy L.P. 99% 1% Nxt Phase 2.2% Coral Canyon HD, L.L.C. 50% Lakeside Residential Communities L.L.C. 100% Edgewater at Hayden Ferry Lakeside L.L.C. 100% BV at Hayden Ferry Lakeside L.L.C. 100%	

 

EXHIBIT C