Securities and Exchange Commission Washington, DC 20549 FORM 8-K Current Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report (Date of earliest event reported) - November 19, 1997 Minnesota Power & Light Company A Minnesota Corporation Commission File No. 1-3548 IRS Employer Identification No. 41-0418150 30 West Superior Street Duluth, Minnesota 55802 Telephone - (218) 722-2641 Minnesota Power & Light Company Index Item 7. Financial Statements and Exhibits Financial Statements None Exhibits 12 - Computation of Ratios of Earnings to Fixed Charges and Supplemental Ratios of Earnings to Fixed Charges. -1- Signatures Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. Minnesota Power & Light Company ----------------------------------- (Registrant) November 19, 1997 D. G. Gartzke ----------------------------------- D. G. Gartzke Senior Vice President - Finance and Chief Financial Officer -2-
Exhibit 12 Minnesota Power & Light Company Computation of Ratios of Earnings to Fixed Charges and Supplemental Ratios of Earnings to Fixed Charges
For the Year Ended ------------------------------------------------------------------- December 31, ------------------------------------------------------------------- Nine Months Ended 1992 1993 1994 1995 1996 September 30, 1997 ----------- ------------ ------------ ------------ ------------ ------------------ (In thousands except ratios) Income from continuing operations $ 67,821 $ 64,374 $ 59,465 $ 61,857 $ 69,221 $ 58,029 per consolidated statement of income Add (deduct) Current income tax expense 29,147 29,277 24,116 13,356 31,395 37,450 Deferred income tax expense (benefit) (1,113) 1,084 (981) (11,336) (9,770) 856 Deferred investment tax credits (1,568) (2,035) (2,478) (865) (1,986) (1,352) Undistributed income from less than 50% owned equity investments (5,733) (6,009) (7,547) (9,124) (10,994) (10,216) Minority interest 2,684 (83) (879) 260 3,269 1,440 ----------- ------------ ------------ ------------ ------------ ---------- 91,238 86,608 71,696 54,148 81,135 86,207 ----------- ------------ ------------ ------------ ------------ ---------- Fixed charges Interest on long-term debt 44,008 44,647 48,137 45,713 52,386 38,988 Capitalized interest 422 3,010 - 1,395 1,450 396 Other interest charges - net 6,455 1,501 7,382 7,934 10,193 10,621 Interest component of all rentals 5,728 5,729 5,737 3,670 2,541 2,607 Distributions on redeemable preferred securities of subsidiary - - - - 4,729 4,528 ----------- ------------ ------------ ------------ ------------ ---------- Total fixed charges 56,613 54,887 61,256 58,712 71,299 57,140 ----------- ------------ ------------ ------------ ------------ ---------- Earnings before income taxes and fixed charges (excluding capitalized interest) $147,429 $138,485 $132,952 $111,465 $150,984 $142,951 =========== ============ ============ ============ ============ ========== Ratio of earnings to fixed charges 2.60 2.52 2.17 1.90 2.12 2.50 =========== ============ ============ ============ ============ ========== Earnings before income taxes and fixed charges (excluding capitalized interest) $147,429 $138,485 $132,952 $111,465 $150,984 $142,951 Supplemental charges 16,017 15,149 14,370 13,519 14,431 9,044 ----------- ------------ ------------ ------------ ------------ ---------- Earnings before income taxes and fixed and supplemental charges (excluding capitalized interest) $163,446 $153,634 $147,322 $124,984 $165,415 $151,995 =========== ============ ============ ============ ============ ========== Total fixed charges $ 56,613 $ 54,887 $ 61,256 $ 58,712 $ 71,299 $ 57,140 Supplemental charges 16,017 15,149 14,370 13,519 14,431 9,044 ----------- ------------ ------------ ------------ ------------ ---------- Fixed and supplemental charges $ 72,630 $ 70,036 $ 75,626 $ 72,231 $ 85,730 $ 66,184 =========== ============ ============ ============ ============ ========== Supplemental ratio of earnings to fixed charges 2.25 2.19 1.95 1.73 1.93 2.30 =========== ============ ============ ============ ============ ========== The supplemental ratio of earnings to fixed charges includes Minnesota Power's (Company) obligation under a contract with Square Butte Electric Cooperative (Square Butte) which extends through 2007, pursuant to which the Company is purchasing 71 percent of the output of a generating unit capable of generating up to 470 megawatts. The Company is obligated to pay Square Butte all of Square Butte's leasing and operating and debt service costs, less any amount collected from the sale of power or energy to others, which shall not have been paid by Square Butte when due. (See Note 17 to the Company's 1996 Consolidated Financial Statements incorporated by reference in the Company's 1996 Annual Report on Form 10-K.)