QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that each Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes [X]    No [  ]

Indicate by check mark whether the Registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act).    Yes [X]    No [  ]

Indicate the number of shares outstanding of each of the Registrant's classes of common stock as of the latest practicable date (March 31, 2004):

Wisconsin Energy Corporation is a diversified holding company which conducts its operations primarily in three operating segments: a utility energy segment, a non-utility energy segment and a manufacturing segment. Unless qualified by their context when used in this document, the terms Wisconsin Energy, the Company, Our, Us or We refer to the holding company and all of its subsidiaries. Our primary subsidiaries are Wisconsin Electric Power Company (Wisconsin Electric), Wisconsin Gas Company (Wisconsin Gas), W.E. Power, LLC (We Power) and WICOR Industries, LLC (WICOR Industries).

Utility Energy Segment:   Our utility energy segment consists of: Wisconsin Electric, which serves electric customers in Wisconsin and the Upper Peninsula of Michigan, gas customers in Wisconsin and steam customers in metro Milwaukee, Wisconsin; Wisconsin Gas, which serves gas customers in Wisconsin and water customers in suburban Milwaukee, Wisconsin; and Edison Sault Electric Company (Edison Sault), which serves electric customers in the Upper Peninsula of Michigan. In April 2002, Wisconsin Electric and Wisconsin Gas began doing business under the trade name of "We Energies".

Non-Utility Energy Segment:   Our non-utility energy segment consists of We Power and Wisvest Corporation (Wisvest). We Power was formed in 2001 to design, construct, own, finance and lease the new generating capacity included in our Power the Future strategy. Wisvest owns and has investments in electric generating facilities and other energy-related entities and assets. We have reduced the operations of Wisvest.

Manufacturing Segment:   Our manufacturing segment consists of WICOR Industries, an intermediary holding company, and its three primary subsidiaries: Sta-Rite Industries, LLC (Sta-Rite), SHURflo, LLC (SHURflo) and Hypro, LLC (Hypro), which are manufacturers of pumps, water treatment products and fluid handling equipment with manufacturing, sales and distribution facilities in the United States and several other countries. In February 2004, we announced that we reached an agreement to sell this segment to Pentair, Inc. for $850 million and the assumption of approximately $25 million of debt. Subject to customary regulatory approvals, we expect the sale to close during the third quarter of 2004. Accordingly, this segment is reflected as discontinued operations in the accompanying financial statements.

Other:   Other non-utility operating subsidiaries of Wisconsin Energy include Minergy Corp. (Minergy), which has $54 million of assets and develops and markets recycling technologies, and Wispark LLC (Wispark), which has $151 million of assets and develops and invests in real estate.

We have prepared the unaudited interim financial statements presented in this Form 10-Q pursuant to the rules and regulations of the Securities and Exchange Commission. We have condensed or omitted some information and note disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles pursuant to these rules and regulations. Our financial statements should be read in conjunction with the financial statements and notes thereto included in our 2003 Annual Report on Form 10-K.

WISCONSIN ENERGY CORPORATION
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
(Unaudited)

Our accompanying unaudited consolidated condensed financial statements should be read in conjunction with Item 8, Financial Statements and Supplementary Data, in our 2003 Annual Report on Form 10-K. In the opinion of management, we have included all adjustments, normal and recurring in nature, necessary to a fair statement of the results of operations, cash flows and financial position in the accompanying income statements, statements of cash flows and balance sheets. The results of operations for the three months ended March 31, 2004 are not necessarily indicative of the results which may be expected for the entire fiscal year 2004 because of seasonal and other factors.

We have modified certain income statement, balance sheet and cash flow presentations. Prior year financial statement amounts have been reclassified to conform to their current year presentation. These reclassifications had no effect on earnings per share.

The most significant reclassifications relate to the reporting of discontinued operations pursuant to Statement of Financial Accounting Standards (SFAS) 144, Accounting for the Impairment or Disposal of Long-Lived Assets. Previously, these were included as components of continuing operations. For further information see Note 3 -- Discontinued Operations and Assets Held for Sale.

Variable Interest Entities:   In January 2003, the Financial Accounting Standards Board (FASB) issued Interpretation 46, Consolidation of Variable Interest Entities (FIN 46). This standard requires an enterprise that is the primary beneficiary of a variable interest entity to consolidate that entity. We applied the Interpretation to any existing interests in variable interest entities beginning in the third quarter of 2003. In October 2003, the FASB deferred the adoption of FIN 46 for all entities commonly referred to as special-purpose entities to the first reporting period ending after December 15, 2003. In December 2003, the FASB issued FIN 46R, which revised FIN 46 and deferred the effective date for interests held in variable interest entities other than special purpose entities to financial statements for periods ending after March 15, 2004.

Upon adoption of FIN 46R in the first quarter of 2004, we evaluated several tolling and purchased power agreements with third parties and concluded that for three of these agreements, after making an exhaustive effort, we are unable to obtain the information necessary to determine whether we or the entity that owns the facility is the variable interest entity's primary beneficiary. Pursuant to the terms of two of the agreements, we deliver fuel to the entity's facilities and receive electric power. We pay the entity a "toll" to convert our fuel into the electric energy. The output of the facility is available for us to dispatch during the term of the respective agreement. In the other agreement we have rights to the firm capacity. We have approximately $788.9 million of required payments over the remaining term of the agreements, which expire in 5 to 25 years. We believe the required payments will continue to be recoverable in rates. We account for one of these agreements as a capita l lease.

On February 4, 2004, we announced that we had reached an agreement to sell our manufacturing business to Pentair, Inc. for $850 million in cash. In addition, Pentair will assume approximately $25 million of third party debt. This sale is subject to regulatory approvals and is expected to close in the third quarter of 2004. When the sale is completed, we expect to realize net cash proceeds of approximately $740 million after the payment of taxes and transaction costs.

In March 2004, WICOR, Inc. applied to the Public Service Commission of Wisconsin (PSCW) for approval to transfer its current ownership interest in Wisconsin Gas to Wisconsin Energy, which, if approved, is expected to result in Wisconsin Gas becoming a direct wholly-owned subsidiary of Wisconsin Energy.

In the accompanying balance sheets, the assets and liabilities associated with our manufacturing segment have been reclassified as held for sale in accordance with SFAS 144, Accounting for the Impairment or Disposal of Long-Lived Assets. SFAS 144 requires that a long-lived asset classified as held for sale be measured at the lower of its carrying amount or fair value, less costs to sell, and cease being depreciated. Included in discontinued operations is interest expense associated with third-party debt that will be assumed by the buyer upon completion of the sale. A summary of the components of Income from Discontinued Operations, Net of Tax in our Consolidated Condensed Income Statements follows:

Assets and liabilities held for sale on our Consolidated Condensed Balance Sheets follow:

A summary of the components of cash flows for discontinued operations follows:

We account for asset retirement obligations under SFAS 143, Accounting for Asset Retirement Obligations. SFAS 143 primarily applies to the future decommissioning costs for our Point Beach Nuclear Plant (Point Beach).

SFAS 143 also applies to a smaller extent to several other utility assets including the dismantlement of certain hydro facilities and the removal of certain coal handling equipment and water intake facilities located on lakebeds. We have not recorded any asset retirement obligations for the removal of the coal handling equipment or for the water intake facilities located on lakebeds because the associated liability cannot be reasonably estimated.

The following table presents the change in our asset retirement obligations, which are included on the consolidated balance sheet in "Deferred Credits and Other Liabilities".

We account for goodwill and other intangibles under SFAS 142, Goodwill and Other Intangible Assets. Under SFAS 142, goodwill and other intangibles with indefinite lives are not subject to amortization. However, goodwill and other intangibles are subject to fair value-based rules for measuring impairment, and resulting write-downs, if any, are to be reflected in operating expense.

We assess the fair value of our SFAS 142 reporting units by considering fair value based on public company trading multiples and merger and acquisition transaction multiples for similar companies. This evaluation utilizes the information available under the circumstances, including reasonable and supportable assumptions and projections. We perform our annual impairment test for all our reporting units as of August 31.

The following table presents the details of our intangible assets, the majority of which are included on the consolidated balance sheet in "Assets held for sale". Pursuant to SFAS 144, we ceased amortizing intangible assets associated with our manufacturing segment of approximately $76.1 million at March 31, 2004 and reclassified them from "Deferred Charges and Other Assets" to "Assets held for sale".

The amount of amortization expense included in operating income for identifiable intangibles was $0.1 million for the three months ended March 31, 2004 and 2003, respectively.

The following table presents the changes in our goodwill during the first quarter of 2004:

Comprehensive Income:   Comprehensive Income includes all changes in equity during a period except those resulting from investments by and distributions to owners. We had the following total Comprehensive Income during the three months ended March 31, 2004 and 2003:

Stock-Based Compensation:   We apply Accounting Principles Board Opinion No. 25, Accounting for Stock Issued to Employees, and related interpretations in accounting for our stock option plans and have adopted the disclosure-only provisions of SFAS 123, Accounting for Stock-Based Compensation, as amended by SFAS 148, Accounting for Stock-Based Compensation - Transition and Disclosure, an amendment of SFAS 123. The following table illustrates the effect on net income and earnings per share as if we had accounted for stock options under the fair value method of SFAS 123 in each period. The fair value of options at date of grant was estimated using the Black-Scholes option-pricing model. Had we expensed stock-based compensation under SFAS 123, our diluted earnings would have been reduced by $0.02 per share for the three months ended March 31, 2004.

Common Stock Repurchases:   The Board of Directors approved a common stock repurchase plan which, as amended, authorized us to purchase up to $400 million of our shares of common stock in the open market through December 31, 2004. As part of this plan, in March 2004, we restarted our stock repurchasing program. Through the first three months of 2004, we purchased and retired approximately 0.4 million shares of common stock for $12.0 million. Since the plan began in September 2000, we have purchased approximately 13.7 million shares of common stock for $305.6 million. We retire the stock that we repurchase.

In February 2004, we announced that we did not expect to issue new shares through our various employee benefit plans and the dividend reinvestment plan; rather, we instructed the plan agents to begin purchasing shares for the plans in the open market in lieu of issuing new shares. Prior to this announcement, in the first quarter of 2004 we issued approximately 0.2 million new shares of common stock for $4.8 million.

In the first quarter of 2004, we received proceeds of $14.8 million related to the exercise of stock options. Instead of issuing new shares for these stock options, we instructed our plan agent to purchase common stock in the open market at a cost of $26.3 million. This cost is included in "Repurchase of common stock" on our Consolidated Condensed Statements of Cash Flows.

We follow SFAS 133, Accounting for Derivative Instruments and Hedging Activities, as amended by SFAS 149, Amendment of Statement 133 on Derivative Instruments and Hedging Activities, effective July 1, 2003, which requires that every derivative instrument be recorded on the balance sheet as an asset or liability measured at its fair value and that changes in the derivative's fair value be recognized currently in earnings unless specific hedge accounting criteria are met. For any electric-related contracts in our regulated electric operations that qualify as derivatives under SFAS 133, the PSCW allows the effects of the fair market value accounting to be offset to regulatory assets and liabilities.

During March 2003, we settled several treasury lock agreements entered into earlier in the quarter to mitigate interest rate risk associated with the issuance of $200 million of long-term unsecured senior notes in March 2003. As these agreements qualified for cash flow hedge accounting treatment under SFAS 133, the payment made upon settlement of these agreements was deferred in Accumulated Other Comprehensive Income and is amortized as an increase to interest expense over the same period in which the interest cost is recognized in income. For the quarters ended March 31, 2004 and 2003, $0.2 million in treasury lock agreement settlement payments previously deferred in Accumulated Other Comprehensive Income were reclassified as an increase to interest expense.

In March 2004, WEC Capital Trust I, the issuer of our Trust Preferred Securities, redeemed all of the $200 million of the outstanding Trust Preferred Securities, which required us to redeem the long-term notes due to the Trust. We financed this redemption through the issuance of short-term commercial paper. In March 2004, we recorded approximately $5.9 million of costs associated with this early redemption, which are included in Other Income, Net in our Consolidated Condensed Income Statement for the three months ended March 31, 2004.

The components of our net periodic pension and other post-retirement benefit costs for the three months ended March 31, 2004 and 2003 were as follows:

We previously disclosed that we expect to contribute $5.7 million to our qualified pension plans in 2004. This contribution is expected to occur in September 2004. Any contribution in 2004 to other post-retirement benefit plans is expected to occur in December. This contribution is discretionary as these plans are not subject to any minimum regulatory funding requirements.

Employee Benefit Plans and Post-retirement Benefits:   In December 2003, the Medicare Prescription Drug, Improvement and Modernization Act of 2003 (Act) was signed into law. The Act introduced a prescription drug benefit program under Medicare as well as a federal subsidy to sponsors of retiree health care benefit plans. Certain accounting issues raised by the Act, such as how to account for the federal subsidy, are not explicitly addressed by SFAS 106, Employers' Accounting for Post-retirement Benefits Other Than Pensions.

The FASB issued FASB Staff Position (FSP) SFAS 106-1, Accounting and Disclosure Requirements Related to the Medicare Prescription Drug, Improvement and Modernization Act of 2003 (FSP 106-1) that allows sponsors to elect to defer recognition of the effects of the Act.

We are in the process of evaluating the impact of the Act on our U.S. post-retirement health plans. During this period, in accordance with FSP 106-1, we have elected to defer recognition of the effects of the Act. Accordingly, the financial statements do not reflect the effects of the Act. Upon the issuance of final guidance on this matter by the FASB, previously issued financial statements may require restatement and future results of operations may be impacted. That accounting guidance is expected to be issued by the FASB in the second quarter of 2004.

We enter into various guarantees to provide financial and performance assurance to third parties on behalf of affiliates. As of March 31, 2004, we had the following guarantees:

Our guarantees issued in support of energy related affiliates are for obligations under commodity contracts and credit agreements between the affiliates and third parties. Failure of the affiliates to fulfill their obligations under the agreements would require our performance under the guarantees. The Wisconsin Energy joint venture guarantees are related to affiliates that were sold during the fourth quarter of 2003, and the guarantees are backstopped by the acquiring company until anticipated termination during May 2004.

Other guarantees support obligations of our affiliates to third parties under loan agreements. In the event our affiliates fail to perform under the loan agreements, we would be responsible for the obligations.

Wisconsin Electric guarantees the potential retrospective premiums that could be assessed under Wisconsin Electric's nuclear insurance program.

Subsidiary guarantees support loan obligations between our affiliates and third parties. In the event the loan obligations are not performed, our subsidiary would be responsible for the obligations. Approximately $1.9 million of our subsidiary guarantees relate to discontinued operations and we anticipate they will be terminated upon completion of the sale to Pentair, Inc.

Postemployment benefits:   Postemployment benefits provided to former or inactive employees are recognized when an event occurs. The estimated liability for such benefits has not changed significantly from the $13.1 million accrual we recorded as of December 31, 2003.

Summarized financial information concerning our reportable operating segments for the three month periods ended March 31, 2004 and 2003 is shown in the following table.

Environmental Matters:   We periodically review our exposure for remediation costs as evidence becomes available indicating that our remediation liability has changed. Based on current information, management believes that future costs in excess of the amounts accrued and/or disclosed on all presently known and quantifiable environmental contingencies will not be material to our financial position or results of operations.

Cautionary Factors:   Certain statements contained herein are "Forward-Looking Statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-Looking Statements may be identified by reference to a future period or periods or by the use of forward looking terminology such as "may," "intends," "anticipates," "believes," "estimates," "expects," "forecasts," "objectives," "plans," "possible," "potential," "project" or similar terms or variations of these terms. Actual results may differ materially from those set forth in Forward-Looking Statements as a result of certain risks and uncertainties, including but not limited to, changes in political and economic conditions, equity and bond market fluctuations, varying weather conditions, governmental regulation and supervision, as well as other risks and uncertainties detailed from time to time in our filings with the Securities and Exchange Commission (SEC) including factors described throughout this document and below in "Factors Affecting Results, Liquidity and Capital Resources".

The following table compares our net income during the first quarter of 2004 with similar information during the first quarter of 2003 including favorable (better (B)) or unfavorable (worse (W)) variances.