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Technology Stocks : Discuss Year 2000 Issues -- Ignore unavailable to you. Want to Upgrade?

To: Cheeky Kid who wrote (3737)	2/10/1999 8:41:00 AM
From: J.L. Turner	Read Replies (1) \| Respond to of 9818

Cheeky this is called slippage.Do you think slippage is a potential problem or should we ignore it?What's your take on the difference between the 11-6 98 10q and the 2-9-99 10-k405 annual report? Below are some snippets from Minnesota Power's very recently filed 10K (Annual Report) and how it stacks up to the previous 10Q (Quarterly Report). My executive summary: For starters, this company must have lied its ass of to the NERC (or the NERC lied its ass off). :) Since 11/6/98, this company has completed only an additional 2 (and I mean two) percent of its remediation tasks. So as of today 2/9/99, this company has only remediated 17 percent of its systems. Its deadline is June 30, 1999 but at this rate (2 percent a quarter) it might be done in time for the 2038 bug. :) Since 11/6/1998, it has accomplished only 20% of its contigency planning. There is one mitigating statement: they say most of their costs that will occur in 1999 will be for non-labor items. This could be for wholesale system replacements. The obvious problem with that is they estimate the total costs will be about "5-9 million". While costs and progress are not neccessarily linear indicators, they should be somewhat in proportion. That said, what kind of confidence can you have with "June 30" completion promises with cost estimates ranging that wildly. The RISKS section was added in this 10K and is actually quite candid. It certainly sounds like predictions considered ludicrous just a few short months ago. ######################################################### corporate-ir.net 11/6/98: 10Q Remediation is expected to be substantially complete by June 30, 1999. The Company estimates that as of November 6, 1998 the remediation phase is approximately 15 percent complete. Contingency plans are expected to be developed by June 30, 1999. (No status given) ... the Company has incurred approximately $0.6 million in expenses primarily for labor associated with inventory, evaluation and remediation efforts. The Company estimates its cost to prepare for the Year 2000 will be $6 million to $10 million over the next two years, the majority of which will be incurred in 1999. 2/9/99: 10-K405 Annual Report Remediation is expected to be substantially complete by June 30, 1999. The Company estimates that as of February 9, 1999 the remediation phase is approximately 17% complete. Contingency plans are expected to be developed by June 30, 1999. The Company estimates that as of February 9, 1999 the contingency planning phase is approximately 20% complete. ... the Company has incurred $1.2 million in expenses primarily for labor associated with inventory, evaluation and remediation efforts. The Company estimates its remaining costs to prepare for the Year 2000 will be $5 million to $9 million, the majority of which are non-labor costs and will be incurred in 1999. RISKS. Based upon information to date, the Company believes that, in the most reasonably likely worst-case scenario, Year 2000 issues could result in abnormal operating conditions, such as short-term interruption of generation, transmission and distribution functions within Electric Operations, as well as Company-wide loss of system monitoring and control functions, and loss of voice communications. These conditions, along with power outages due to possible instability of the regional electric transmission grid, could result in temporary interruption of service to customers. The Company does not believe the overall impact of this scenario will have a material impact on its financial condition or operations due to the anticipated short-term nature of interruptions. Posted by year2000watcher on csy2k J.L.T.