ALLIANT ENERGY CORP - 10-Q Quarterly Report

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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 10-Q

[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 2003
-------------

or

[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from _______ to _______

Commission Name of Registrant, State of Incorporation, IRS Employer
File Number Address of Principal Executive Offices and Telephone Number Identification Number
- ----------- ----------------------------------------------------------- ---------------------

1-9894 ALLIANT ENERGY CORPORATION 39-1380265
(a Wisconsin corporation)
4902 N. Biltmore Lane
Madison, Wisconsin 53718
Telephone (608)458-3311

0-4117-1 INTERSTATE POWER AND LIGHT COMPANY 42-0331370
(an Iowa corporation)
Alliant Energy Tower
Cedar Rapids, Iowa 52401
Telephone (319)786-4411

0-337 WISCONSIN POWER AND LIGHT COMPANY 39-0714890
(a Wisconsin corporation)
4902 N. Biltmore Lane
Madison, Wisconsin 53718
Telephone (608)458-3311

This combined Form 10-Q is separately filed by Alliant Energy Corporation,
Interstate Power and Light Company and Wisconsin Power and Light Company.
Information contained in the Form 10-Q relating to Interstate Power and Light
Company and Wisconsin Power and Light Company is filed by such registrant on
its own behalf. Each of Interstate Power and Light Company and Wisconsin
Power and Light Company makes no representation as to information relating to
registrants other than itself.

Indicate by check mark whether the registrants (1) have 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 the
registrants were required to file such reports), and (2) have been subject
to such filing requirements for the past 90 days. Yes [ X ] No [ ]

Indicate by check mark whether the registrants are accelerated filers (as
defined in Rule 12b-2 of the Exchange Act).
Alliant Energy Corporation Yes [ X ] No [ ]
Interstate Power and Light Company Yes [ ] No [ X ]
Wisconsin Power and Light Company Yes [ ] No [ X ]

Number of shares outstanding of each class of common stock as of July 31, 2003:

Alliant Energy Corporation Common stock, $0.01 par value, 110,393,323 shares outstanding

Interstate Power and Light Company Common stock, $2.50 par value, 13,370,788 shares outstanding (all of which
are owned beneficially and of record by Alliant Energy Corporation)

Wisconsin Power and Light Company Common stock, $5 par value, 13,236,601 shares outstanding (all of which are
owned beneficially and of record by Alliant Energy Corporation)

TABLE OF CONTENTS

Page
----

Part I. Financial Information 3

Item 1. Consolidated Financial Statements 3

Alliant Energy Corporation:
---------------------------
Consolidated Statements of Income for the Three and Six Months Ended
June 30, 2003 and 2002 3
Consolidated Balance Sheets as of June 30, 2003 and December 31, 2002 4
Consolidated Statements of Cash Flows for the Six Months Ended
June 30, 2003 and 2002 6
Notes to Consolidated Financial Statements 7

Interstate Power and Light Company:
-----------------------------------
Consolidated Statements of Income for the Three and Six Months Ended
June 30, 2003 and 2002 18
Consolidated Balance Sheets as of June 30, 2003 and December 31, 2002 19
Consolidated Statements of Cash Flows for the Six Months Ended
June 30, 2003 and 2002 21
Notes to Consolidated Financial Statements 22

Wisconsin Power and Light Company:
----------------------------------
Consolidated Statements of Income for the Three and Six Months Ended
June 30, 2003 and 2002 23
Consolidated Balance Sheets as of June 30, 2003 and December 31, 2002 24
Consolidated Statements of Cash Flows for the Six Months Ended
June 30, 2003 and 2002 26
Notes to Consolidated Financial Statements 27

Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations 29

Item 3. Quantitative and Qualitative Disclosures About Market Risk 45

Item 4. Controls and Procedures 45

Part II. Other Information 45

Item 1. Legal Proceedings 45

Item 4. Submission of Matters to a Vote of Security Holders 46

Item 6. Exhibits and Reports on Form 8-K 47

Signatures 48

1

DEFINITIONS

Certain abbreviations or acronyms used in the text and notes of this combined Form 10-Q are defined below:

Abbreviation or Acronym Definition
- ----------------------- ----------
AFUDC....................................... Allowance for Funds Used During Construction
Alliant Energy.............................. Alliant Energy Corporation
ARO......................................... Asset Retirement Obligation
ATC......................................... American Transmission Company LLC
Capstone.................................... Capstone Turbine Corporation
Corporate Services.......................... Alliant Energy Corporate Services, Inc.
DAEC........................................ Duane Arnold Energy Center
Dth......................................... Dekatherm
EBITDA...................................... Earnings Before Interest, Taxes, Depreciation and Amortization
EITF........................................ Emerging Issues Task Force
EITF Issue 02-3............................. Issues Related to Accounting for Contracts Involved in Energy
Trading and Risk Management Activities
EITF Issue 98-10............................ Accounting for Contracts Involved in Energy Trading and Risk
Management Activities
Enermetrix.................................. Enermetrix, Inc.
EPS......................................... Earnings Per Average Common Share
FASB........................................ Financial Accounting Standards Board
FIN......................................... FASB Interpretation No.
FIN 46...................................... Consolidation of Variable Interest Entities
GAAP........................................ Accounting Principles Generally Accepted in the U.S.
IP&L........................................ Interstate Power and Light Company
IPO......................................... Initial Public Offering
IRS......................................... Internal Revenue Service
ISO......................................... Independent System Operator
IUB......................................... Iowa Utilities Board
Kewaunee.................................... Kewaunee Nuclear Power Plant
KV.......................................... Kilovolt
McLeod...................................... McLeodUSA Incorporated
MD&A........................................ Management's Discussion and Analysis of Financial Condition and
Results of Operations
Meridian.................................... Meridian Energy Limited
MW.......................................... Megawatt
MWh......................................... Megawatt-hour
NG Energy................................... NG Energy Trading, LLC
PSCW........................................ Public Service Commission of Wisconsin
PUHCA....................................... Public Utility Holding Company Act of 1935
Resources................................... Alliant Energy Resources, Inc.
SEC......................................... Securities and Exchange Commission
SFAS........................................ Statement of Financial Accounting Standards
SFAS 115.................................... Accounting for Certain Investments in Debt and Equity Securities
SFAS 133.................................... Accounting for Derivative Instruments and Hedging Activities
SFAS 143.................................... Accounting for Asset Retirement Obligations
SmartEnergy................................. SmartEnergy, Inc.
South Beloit................................ South Beloit Water, Gas and Electric Company
Southern Hydro.............................. Southern Hydro Partnership
Synfuel..................................... Alliant Energy Synfuel LLC
TBD......................................... To Be Determined
TRANSLink................................... TRANSLink Transmission Company LLC
U.S. ....................................... United States of America
Whiting..................................... Whiting Petroleum Corporation
WP&L........................................ Wisconsin Power and Light Company
WUHCA....................................... Wisconsin Utility Holding Company Act

2

PART I. FINANCIAL INFORMATION
ITEM 1. CONSOLIDATED FINANCIAL STATEMENTS
ALLIANT ENERGY CORPORATION
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)

For the Three Months For the Six Months
Ended June 30, Ended June 30,
2003 2002 2003 2002
- ----------------------------------------------------------------------------------------------------------------------------------
(in thousands, except per share amounts)

Operating revenues:
Electric utility $444,108 $412,650 $887,133 $783,412
Gas utility 76,392 65,366 334,273 193,607
Non-regulated and other 125,792 66,444 320,676 138,877
------------- ------------- ------------- -------------
646,292 544,460 1,542,082 1,115,896
------------- ------------- ------------- -------------
- ----------------------------------------------------------------------------------------------------------------------------------
Operating expenses:
Electric and steam production fuels 87,228 75,148 159,643 137,758
Purchased power 88,053 91,496 218,432 163,833
Cost of utility gas sold 49,744 38,719 238,069 122,475
Other operation and maintenance 265,555 182,936 582,510 368,468
Depreciation and amortization 77,985 70,566 157,584 146,115
Taxes other than income taxes 20,785 25,194 46,861 52,982
------------- ------------- ------------- -------------
589,350 484,059 1,403,099 991,631
------------- ------------- ------------- -------------
- ----------------------------------------------------------------------------------------------------------------------------------
Operating income 56,942 60,401 138,983 124,265
------------- ------------- ------------- -------------
- ----------------------------------------------------------------------------------------------------------------------------------
Interest expense and other:
Interest expense 56,198 46,036 111,712 90,523
Interest income from loans to discontinued operations, net (27) (4,234) (3,281) (7,600)
Equity (income) loss from unconsolidated investments (9,237) 6,809 (4,983) 3,596
Allowance for funds used during construction (4,572) (1,696) (8,433) (3,350)
Preferred dividend requirements of subsidiaries 3,968 1,682 8,126 3,364
Impairment of available-for-sale securities of McLeodUSA Inc. - 6,044 - 27,218
Miscellaneous, net (7,334) 7,402 (4,919) 17,006
------------- ------------- ------------- -------------
38,996 62,043 98,222 130,757
------------- ------------- ------------- -------------
- ----------------------------------------------------------------------------------------------------------------------------------
Income (loss) from continuing operations before income taxes 17,946 (1,642) 40,761 (6,492)
------------- ------------- ------------- -------------
- ----------------------------------------------------------------------------------------------------------------------------------
Income taxes 6,217 3,866 14,393 6,807
------------- ------------- ------------- -------------
- ----------------------------------------------------------------------------------------------------------------------------------
Income (loss) from continuing operations 11,729 (5,508) 26,368 (13,299)
------------- ------------- ------------- -------------
- ----------------------------------------------------------------------------------------------------------------------------------
Income from discontinued operations, net of tax (Note 8) 20,425 11,823 11,291 29,357
------------- ------------- ------------- -------------
- ----------------------------------------------------------------------------------------------------------------------------------
Income before cumulative effect of changes in
accounting principles, net of tax 32,154 6,315 37,659 16,058
------------- ------------- ------------- -------------
- ----------------------------------------------------------------------------------------------------------------------------------
Cumulative effect of changes in accounting principles, net of tax - - (5,983) -
------------- ------------- ------------- -------------
- ----------------------------------------------------------------------------------------------------------------------------------
Net income $32,154 $6,315 $31,676 $16,058
============= ============= ============= =============
- ----------------------------------------------------------------------------------------------------------------------------------
Average number of common shares outstanding (diluted) 93,022 90,553 92,780 90,304
============= ============= ============= =============
- ----------------------------------------------------------------------------------------------------------------------------------
Earnings per average common share (basic and diluted):
Income (loss) from continuing operations $0.13 ($0.06) $0.28 ($0.15)
Income from discontinued operations 0.22 0.13 0.12 0.33
Cumulative effect of changes in accounting principles - - (0.06) -
------------- ------------- ------------- -------------
Net income $0.35 $0.07 $0.34 $0.18
============= ============= ============= =============
- ----------------------------------------------------------------------------------------------------------------------------------
Dividends declared per common share $0.25 $0.50 $0.50 $1.00
============= ============= ============= =============
- ----------------------------------------------------------------------------------------------------------------------------------
The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.

3

ALLIANT ENERGY CORPORATION
CONSOLIDATED BALANCE SHEETS (UNAUDITED)

June 30, December 31,
ASSETS 2003 2002
- ----------------------------------------------------------------------------------------------------------------
(in thousands)

Property, plant and equipment:
Utility:
Electric plant in service $5,513,787 $5,295,381
Gas plant in service 628,651 613,122
Other plant in service 549,774 530,456
Accumulated depreciation (3,439,286) (3,573,407)
----------------- ----------------
Net plant 3,252,926 2,865,552
Construction work in progress:
Power Iowa generating facility 186,277 10,651
Other 238,141 252,445
Other, net 64,720 68,340
----------------- ----------------
Total utility 3,742,064 3,196,988
----------------- ----------------
Non-regulated and other, net:
Non-regulated generation 209,326 156,699
International 197,285 171,179
Integrated Services 69,762 73,983
Investments 53,522 54,303
Corporate Services and other 69,978 75,282
----------------- ----------------
Total non-regulated and other 599,873 531,446
----------------- ----------------
4,341,937 3,728,434
----------------- ----------------
- ----------------------------------------------------------------------------------------------------------------
Current assets:
Cash and temporary cash investments 67,236 62,859
Restricted cash 9,191 9,610
Accounts receivable:
Customer, less allowance for doubtful accounts of $5,051 and $4,364 57,728 69,413
Unbilled utility revenues 16,316 50,624
Other, less allowance for doubtful accounts of $750 and $845 68,025 60,107
Income tax refunds receivable 143,802 97,469
Production fuel, at average cost 57,541 63,126
Materials and supplies, at average cost 66,861 58,603
Gas stored underground, at average cost 46,656 62,797
Regulatory assets 59,731 46,076
Assets of discontinued operations (Note 8) 633,840 969,291
Other 68,099 74,314
----------------- ----------------
1,295,026 1,624,289
----------------- ----------------
- ----------------------------------------------------------------------------------------------------------------
Investments:
Investments in unconsolidated foreign entities 446,338 373,816
Nuclear decommissioning trust funds 367,004 344,892
Investment in ATC and other 230,204 217,992
----------------- ----------------
1,043,546 936,700
----------------- ----------------
- ----------------------------------------------------------------------------------------------------------------
Other assets:
Regulatory assets 337,573 302,365
Deferred charges and other 365,453 409,607
----------------- ----------------
703,026 711,972
----------------- ----------------
- ----------------------------------------------------------------------------------------------------------------
Total assets $7,383,535 $7,001,395
================= ================
- ----------------------------------------------------------------------------------------------------------------
The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.

4

ALLIANT ENERGY CORPORATION
CONSOLIDATED BALANCE SHEETS (UNAUDITED) (Continued)

June 30, December 31,
CAPITALIZATION AND LIABILITIES 2003 2002
- ---------------------------------------------------------------------------------------------------------------------
(in thousands, except share amounts)

Capitalization:
Common stock - $0.01 par value - authorized 200,000,000 shares;
outstanding 93,076,105 and 92,304,220 shares $931 $923
Additional paid-in capital 1,308,190 1,293,919
Retained earnings 743,698 758,187
Accumulated other comprehensive loss (133,931) (209,943)
Shares in deferred compensation trust - 256,228 and 239,467 shares
at an average cost of $28.03 and $28.80 per share (7,181) (6,896)
-------------------- --------------------
Total common equity 1,911,707 1,836,190
-------------------- --------------------

Cumulative preferred stock of subsidiaries, net 205,063 205,063
Long-term debt (excluding current portion) 2,388,437 2,609,803
-------------------- --------------------
4,505,207 4,651,056
-------------------- --------------------

- ---------------------------------------------------------------------------------------------------------------------

Current liabilities:
Current maturities and sinking funds 70,839 46,591
Variable rate demand bonds 55,100 55,100
Commercial paper 316,400 195,500
Other short-term borrowings 24,004 113,721
Accounts payable 247,393 282,855
Accrued taxes 126,187 105,521
Liabilities of discontinued operations (Note 8) 204,671 138,251
Other 200,522 184,771
-------------------- --------------------
1,245,116 1,122,310
-------------------- --------------------

- ---------------------------------------------------------------------------------------------------------------------

Other long-term liabilities and deferred credits:
Accumulated deferred income taxes 663,238 630,625
Accumulated deferred investment tax credits 51,811 54,375
Asset retirement obligations (Note 11) 368,040 -
Pension and other benefit obligations 197,776 181,010
Environmental liabilities 41,953 48,730
Other 264,595 269,864
-------------------- --------------------
1,587,413 1,184,604
-------------------- --------------------

- ---------------------------------------------------------------------------------------------------------------------

Minority interest 45,799 43,425
-------------------- --------------------

- ---------------------------------------------------------------------------------------------------------------------

Total capitalization and liabilities $7,383,535 $7,001,395
==================== ====================

- ---------------------------------------------------------------------------------------------------------------------

The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.

5

ALLIANT ENERGY CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

For the Six Months Ended June 30,
2003 2002
- ----------------------------------------------------------------------------------------------------------------------
(in thousands)

Cash flows from operating activities:
Net income $31,676 $16,058
Adjustments to reconcile net income to net cash flows from operating activities:
Income from discontinued operations, net of tax (11,291) (29,357)
Depreciation and amortization 157,584 146,115
Other amortizations 33,288 21,938
Deferred tax expense (benefit) and investment tax (credits) 30,869 (20,634)
Equity loss (income) from unconsolidated investments, net (4,983) 3,596
Distributions from equity method investments 6,942 11,812
Non-cash valuation (income) charges (577) 52,641
Refueling outage provision (11,391) 3,972
Cumulative effect of changes in accounting principles, net of tax 5,983 -
Other (14,198) (14,213)
Other changes in assets and liabilities:
Accounts receivable 38,075 34,397
Income tax refunds receivable (46,333) (27,515)
Gas stored underground 16,141 15,891
Accounts payable (42,348) (5,747)
Accrued taxes 20,666 14,167
Other 10,617 39,209
------------------ -----------------
Net cash flows from operating activities 220,720 262,330
------------------ -----------------
- ----------------------------------------------------------------------------------------------------------------------
Cash flows from financing activities:
Common stock dividends (46,165) (89,891)
Proceeds from issuance of common stock 13,005 28,711
Net change in Resources' credit facility - 192,761
Proceeds from issuance of other long-term debt 60,000 -
Reductions in other long-term debt (3,740) (14,090)
Net change in commercial paper and other short-term borrowings 31,183 31,484
Net change in loans to discontinued operations (25,181) (112,601)
Other (19,746) (8,773)
------------------ -----------------
Net cash flows from financing activities 9,356 27,601
------------------ -----------------
- ----------------------------------------------------------------------------------------------------------------------
Cash flows used for investing activities:
Construction and acquisition expenditures:
Regulated domestic utilities (263,000) (173,774)
Non-regulated businesses (212,305) (113,406)
Corporate Services and other (2,742) (16,903)
Nuclear decommissioning trust funds (6,911) (17,658)
Proceeds from asset dispositions 244,220 1,722
Other 15,039 12,995
------------------ -----------------
Net cash flows used for investing activities (225,699) (307,024)
------------------ -----------------
- ----------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in cash and temporary cash investments 4,377 (17,093)
------------------ -----------------
- ----------------------------------------------------------------------------------------------------------------------
Cash and temporary cash investments at beginning of period 62,859 67,886
------------------ -----------------
- ----------------------------------------------------------------------------------------------------------------------
Cash and temporary cash investments at end of period $67,236 $50,793
================== =================
- ----------------------------------------------------------------------------------------------------------------------
Supplemental cash flows information:
Cash paid during the period for:
Interest $96,842 $89,128
================== =================
Income taxes, net of refunds $28,224 $5,879
================== =================
Noncash investing and financing activities:
Debt extinguished directly by sale of Australian business $127,595 $-
================== =================
Capital lease obligations incurred $2,377 $473
================== =================
----------------------------------------------------------------------------------------------------------------------
The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.

6

ALLIANT ENERGY CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

1. The interim consolidated financial statements included herein have been
prepared by Alliant Energy, without audit, pursuant to the rules and
regulations of the SEC. Accordingly, certain information and footnote
disclosures normally included in financial statements prepared in
accordance with GAAP have been condensed or omitted, although management
believes that the disclosures are adequate to make the information
presented not misleading. The consolidated financial statements include
Alliant Energy and its consolidated subsidiaries (including IP&L, WP&L,
Resources and Corporate Services). These financial statements should be
read in conjunction with the financial statements and the notes thereto
included in Alliant Energy's Current Report on Form 8-K, dated June 4,
2003, and IP&L's and WP&L's latest Annual Report on Form 10-K.

In the opinion of management, all adjustments, which are normal and
recurring in nature, necessary for a fair presentation of (a) the
consolidated results of operations for the three and six months ended June
30, 2003 and 2002, (b) the consolidated financial position at June 30, 2003
and Dec. 31, 2002, and (c) the consolidated statement of cash flows for the
six months ended June 30, 2003 and 2002, have been made. Because of the
seasonal nature of Alliant Energy's utility operations, results for the
three and six months ended June 30, 2003 are not necessarily indicative of
results that may be expected for the year ending Dec. 31, 2003. Certain
prior period amounts have been reclassified on a basis consistent with the
current period presentation.

2. Alliant Energy's comprehensive income (loss), and the components of other
comprehensive income (loss), net of taxes, for the three and six months
ended June 30 were as follows (in thousands):

Three Months Six Months
------------------------------ --------------------------------
2003 2002 2003 2002
------------- -------------- -------------- ---------------

Net income $32,154 $6,315 $31,676 $16,058
Unrealized holding gains (losses) on securities, net of tax 4,362 (4,810) 3,405 (10,160)
Less: reclassification adjustment for gains (losses)
included in net income, net of tax (1) 1,003 (3,538) 1,003 (19,723)
------------- -------------- -------------- ---------------
Net unrealized gains (losses) on securities 3,359 (1,272) 2,402 9,563
------------- -------------- -------------- ---------------
Foreign currency translation adjustments, net of tax 41,274 (50,257) 69,506 (43,385)
------------- -------------- -------------- ---------------
Unrealized holding gains (losses) on qualifying
derivatives, net of tax 394 (631) (4,880) (66)
Less: reclassification adjustment for gains (losses)
included in net income, net of tax (2,972) (651) (8,984) 3,406
------------- -------------- -------------- ---------------
Net unrealized gains (losses) on qualifying derivatives 3,366 20 4,104 (3,472)
------------- -------------- -------------- ---------------
Other comprehensive income (loss) 47,999 (51,509) 76,012 (37,294)
------------- -------------- -------------- ---------------
Comprehensive income (loss) $80,153 ($45,194) $107,688 ($21,236)
============= ============== ============== ===============

(1) The three- and six-month 2002 earnings include after-tax losses of
$3.5/$16.5 million and $0/$3.2 million related to asset valuation
charges for Alliant Energy's McLeod (available-for-sale securities) and
Capstone investments, respectively.

7

3. Certain financial information relating to Alliant Energy's significant
business segments is presented below. Intersegment revenues were not
material to Alliant Energy's operations.

Regulated Domestic Utilities Non-regulated Businesses Alliant
--------------------------------------- ---------------------------------- Energy
Electric Gas Other Total International Other Total Other Consolidated
-------------------------------------------------------------------------------------------------
(in thousands)

Three Months Ended June 30, 2003
- --------------------------------
Operating revenues $444,108 $76,392 $9,664 $530,164 $26,671 $90,931 $117,602 ($1,474) $646,292
Operating income (loss) 63,242 (6,865) 1,945 58,322 3,788 (4,775) (987) (393) 56,942
Income (loss) from continuing
operations 22,639 2,048 (4,252) (2,204) (8,706) 11,729
Income (loss) from discontinued
operations, net of tax -- 40,292 (19,867) 20,425 -- 20,425
Net income (loss) 22,639 42,340 (24,119) 18,221 (8,706) 32,154

Three Months Ended June 30, 2002
- --------------------------------
Operating revenues $412,650 $65,366 $8,728 $486,744 $23,693 $35,903 $59,596 ($1,880) $544,460
Operating income (loss) 61,941 (783) 1,597 62,755 561 (2,896) (2,335) (19) 60,401
Income (loss) from continuing
operations 26,930 (15,186) (10,383) (25,569) (6,869) (5,508)
Income from discontinued
operations, net of tax -- 6,866 4,957 11,823 -- 11,823
Net income (loss) 26,930 (8,320) (5,426) (13,746) (6,869) 6,315

Six Months Ended June 30, 2003
- ------------------------------
Operating revenues $887,133 $334,273 $20,523 $1,241,929 $55,142 $248,013 $303,155 ($3,002) $1,542,082
Operating income (loss) 99,996 28,189 3,395 131,580 9,571 (2,116) 7,455 (52) 138,983
Income (loss) from continuing
operations 53,610 (6,338) (6,537) (12,875) (14,367) 26,368
Income (loss) from discontinued
operations, net of tax -- 44,658 (33,367) 11,291 -- 11,291
Cumulative effect of changes in
accounting principles, net of tax -- -- (5,983) (5,983) -- (5,983)
Net income (loss) 53,610 38,320 (45,887) (7,567) (14,367) 31,676

Six Months Ended June 30, 2002
- ------------------------------
Operating revenues $783,412 $193,607 $18,068 $995,087 $49,424 $74,634 $124,058 ($3,249) $1,115,896
Operating income (loss) 108,348 12,645 4,056 125,049 3,011 (3,592) (581) (203) 124,265
Income (loss) from continuing
operations 53,907 (23,380) (34,824) (58,204) (9,002) (13,299)
Income from discontinued
operations, net of tax -- 23,551 5,806 29,357 -- 29,357
Net income (loss) 53,907 171 (29,018) (28,847) (9,002) 16,058

4. The provisions for income taxes for earnings from continuing operations
are based on the estimated annual effective tax rate, which differs from
the federal statutory rate of 35% principally due to state income taxes,
the impact of foreign income and associated taxes, tax credits, effects of
utility rate making and certain non-deductible expenses.

5. Alliant Energy utilizes derivative instruments to manage its exposures to
various market risks as described in Alliant Energy's Current Report on
Form 8-K, dated June 4, 2003, and IP&L's and WP&L's Annual Report on Form
10-K for the year ended Dec. 31, 2002. The following information
supplements, and should be read in conjunction with, Note 10(a) in Alliant
Energy's "Notes to Consolidated Financial Statements" in the Form 8-K,
dated June 4, 2003.

For the six months ended June 30, 2003, no income or loss was recognized in
connection with hedge ineffectiveness in accordance with SFAS 133. At June
30, 2003, the maximum length of time over which Alliant Energy hedged its
exposure to the variability in future cash flows for forecasted
transactions was 14 months (six months for discontinued operations) and
Alliant Energy estimates that income of $0.1 million (including losses of
$0.8 million for discontinued operations) will be reclassified from

8

accumulated other comprehensive loss into earnings within the twelve months
between July 1, 2003 and June 30, 2004 as the hedged transactions affect
earnings.

6. A reconciliation of the weighted average common shares outstanding used in
the basic and diluted EPS calculation for the three and six months ended
June 30 was as follows:

Three Months Six Months
------------------------------ ------------------------------
2003 2002 2003 2002
------------- ------------- ------------- -------------

Weighted average common shares outstanding:
Basic EPS calculation 92,911,219 90,470,080 92,711,140 90,217,146
Effect of dilutive securities 110,661 82,978 68,987 86,395
Diluted EPS calculation 93,021,880 90,553,058 92,780,127 90,303,541

Options to purchase shares of common stock were excluded from the
calculation of diluted EPS as the exercise prices were greater than the
average market price for the three and six months ended June 30 as follows:

Three Months Six Months
------------------------------ ------------------------------
2003 2002 2003 2002
------------- ------------- ------------- -------------

Options to purchase shares of common stock 3,552,262 3,830,442 4,175,799 2,830,765
Average exercise price $29.47 $29.50 $28.03 $29.94

The effect on net income and EPS for the three and six months ended June 30
if Alliant Energy had applied the fair value recognition provisions of SFAS
123, "Accounting for Stock-Based Compensation," to the stock options issued
under its two stock-based incentive compensation plans was as follows
(dollars in thousands):

Three Months Six Months
------------------------------ ------------------------------
2003 2002 2003 2002
------------- ------------- ------------- -------------

Net income, as reported $32,154 $6,315 $31,676 $16,058
Less: stock-based compensation expense, net of tax 259 644 1,150 1,287
------------- ------------- ------------- -------------
Pro forma net income $31,895 $5,671 $30,526 $14,771
============= ============= ============= =============

EPS (basic and diluted):
As reported $0.35 $0.07 $0.34 $0.18
Pro forma $0.34 $0.06 $0.33 $0.16

7. On Jan. 31, 2002, McLeod filed a pre-negotiated plan of reorganization in a
Chapter 11 bankruptcy proceeding and the trading of McLeod's common stock
was suspended by Nasdaq. Consequently, Alliant Energy discontinued
accounting for its investment in McLeod under the provisions of SFAS 115
and reduced the cost basis of its investments to the last quoted market
price on Jan. 30, 2002. In June 2002, Alliant Energy received from McLeod
under its plan of reorganization an initial distribution of approximately
3.3 million shares of new common stock and classified 0.9 million and 2.4
million shares as trading and available-for-sale securities, respectively.
With the receipt of the new McLeod common shares and the resumption of
trading on Nasdaq, Alliant Energy resumed accounting for its McLeod
investments under SFAS 115 and adjusted its cost basis to the quoted market
price on the date the shares were received. As a result of these events,
Alliant Energy recognized pre-tax impairment charges in the first six
months of 2002 for available-for-sale securities totaling $27.2 million
($21.2 million recognized in the first quarter and $6.0 million recognized
in the second quarter).

8. Alliant Energy announced in November 2002 its commitment to pursue the sale
of, or other exit strategies for, certain non-regulated businesses in
2003. Alliant Energy has applied the provisions of SFAS 144, "Accounting
for the Impairment or Disposal of Long-Lived Assets," to certain of its
assets which were held for sale. 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 to cease depreciation, depletion and
amortization. At Dec. 31, 2002, Alliant Energy's oil and gas (Whiting),
Australian (including Southern Hydro), affordable housing and SmartEnergy
businesses were classified as held for sale. In April 2003, Alliant Energy
completed the sale of its Australian assets (including Southern Hydro) to
New Zealand-based Meridian. The sale enabled Alliant Energy to reduce its

9

indebtedness by approximately $320 million in the second quarter of 2003.
Alliant Energy also completed the sale of its affordable housing and
SmartEnergy businesses in July 2003 and these sales enabled Alliant Energy
to reduce its indebtedness by approximately $110 million. Alliant Energy
currently intends to sell 51% or more of its interest in Whiting later in
2003 in a proposed IPO and currently plans to divest its remaining interest
by June 30, 2004. The operating results for these businesses have been
separately classified and reported as discontinued operations in Alliant
Energy's Consolidated Financial Statements. A summary of the components of
discontinued operations in Alliant Energy's Consolidated Statements of
Income for the three and six months ended June 30 was as follows (in
thousands):

Three Months Six Months
------------------------------ ----------------------------
2003 2002 2003 2002
------------- ------------- ------------ ------------

Operating revenues $52,703 $54,490 $119,612 $94,623
Operating expenses 30,591 45,060 71,387 86,624
Interest expense and other (pre-tax numbers):
Gain on sale of Australian business (74,721) -- (72,115) --
Valuation adjustments and selling costs 41,363 -- 76,244 --
Southern Hydro SFAS 133 loss (income) 132 (8,336) (14,689) (36,805)
Other 4,659 8,080 14,677 14,898
------------- ------------- ------------ ------------
Income before income taxes 50,679 9,686 44,108 29,906
Income tax expense (benefit) 30,254 (2,137) 32,817 549
------------- ------------- ------------ ------------
Income from discontinued
operations, net of tax $20,425 $11,823 $11,291 $29,357
============= ============= ============ ============

The valuation adjustments reflect updated estimates of the market value,
less selling costs, of assets classified as held for sale. Alliant
Energy's Australian business entered into electricity derivative contracts
that were not designated as hedges (as defined by SFAS 133) to manage the
electricity commodity price risk associated with anticipated sales into the
spot market and the loss (income) in the previous table reflects the change
in the fair value of these electricity derivative contracts.

A summary of the components of assets and liabilities of discontinued
operations on Alliant Energy's Consolidated Balance Sheets was as follows
(in thousands):

June 30, 2003 Dec. 31, 2002
---------------- ----------------

Assets of discontinued operations:
Property, plant and equipment, net $527,246 $644,910
Current assets 83,746 113,866
Investments 4,860 6,824
Deferred charges and other 17,988 203,691
---------------- ----------------
Total assets of discontinued operations $633,840 $969,291
================ ================
Liabilities of discontinued operations:
Long-term debt (excluding current portion) $101,145 $--
Current liabilities 43,069 73,343
Other long-term liabilities and deferred credits 60,146 64,784
Minority interest 311 124
---------------- ----------------
Total liabilities of discontinued operations 204,671 138,251
---------------- ----------------
Net assets of discontinued operations $429,169 $831,040
================ ================

10

A summary of the components of cash flows for discontinued operations for
the six months ended June 30 was as follows (in thousands):

2003 2002
------------- ------------

Net cash flows from operating activities $50,947 $18,338
Net cash flows from (used for) financing activities (8,582) 137,598
Net cash flows used for investing activities (21,453) (150,559)
------------- ------------
Net increase in cash and temporary cash investments 20,912 5,377
Cash and temporary cash investments at beginning of period 16,043 5,775
------------- ------------
Cash and temporary cash investments at end of period $36,955 $11,152
============= ============
Supplemental cash flows information:
Cash paid (received) during the period for:
Interest $14,111 $7,886
============= ============
Income taxes, net of refunds ($17,246) $19
============= ============

9. Alliant Energy utilizes limited off-balance sheet entities for its
synthetic lease financings and its utility accounts receivable sales
program. Alliant Energy does not currently anticipate these entities will
require consolidation under the guidelines of FIN 46 in the third quarter
of 2003.

10. In accordance with the provisions of FIN 45, "Guarantor's Accounting and
Disclosure Requirements for Guarantees, Including Indirect Guarantees of
Indebtedness to Others," as of June 30, 2003 and Dec. 31, 2002, Alliant
Energy had a guarantee outstanding to support a third-party financing
arrangement of approximately $4 million that is not included on Alliant
Energy's Consolidated Balance Sheets. The guarantee expires in December
2007, the maturity date of the underlying debt. Alliant Energy has also
guaranteed the residual value of its synthetic leases totaling $76 million
in the aggregate that is not included on Alliant Energy's Consolidated
Balance Sheets. The guarantees extend through the maturity of each
respective underlying lease, the latest of which is April 2015.

Under the purchase and sale agreement (Agreement) with Meridian relating to
the sale of Alliant Energy's Australian assets, Alliant Energy agreed to
indemnify Meridian for losses resulting from the breach of the
representations and warranties made by Alliant Energy as of the closing
date, and for breach of its obligations under the Agreement. Based on
exchange rates as of June 30, 2003, the indemnification is limited to
approximately $398 million until September 2003, $199 million from October
2003 through July 2004, and $57 million thereafter until October 2007. The
indemnification limit is subject to fluctuations in foreign currency
exchange rates. Alliant Energy believes the likelihood of having to make
any material cash payments under this indemnification is remote.

11. Alliant Energy adopted SFAS 143 on Jan. 1, 2003, which provides
accounting and disclosure requirements for retirement obligations
associated with long-lived assets (AROs). SFAS 143 requires that when an
asset is placed in service the present value of retirement costs for which
Alliant Energy has a legal obligation must be recorded as liabilities with
an equivalent amount added to the asset cost. The liability is accreted to
its present value each period and the capitalized cost is depreciated over
the useful life of the related asset. Upon settlement of the liability, an
entity settles the obligation for its recorded amount or incurs a gain or
loss.

The scope of SFAS 143 as it relates to Alliant Energy primarily includes
decommissioning costs for DAEC and Kewaunee. It also applies to a smaller
extent to several other regulated and non-regulated assets including, but
not limited to, active ash landfills, water intake facilities, underground
storage tanks, groundwater wells, transmission and distribution equipment,
easements, leases and the dismantlement of certain hydro facilities. Other
than DAEC and Kewaunee, Alliant Energy's current AROs are not significant.

Alliant Energy revised the previously reported amounts recorded upon
adoption in the first quarter of 2003 (the revision had an offsetting
impact on regulatory assets with no impact on net income) and recorded the
following balance sheet entries for accretion and depreciation in 2003
related to SFAS 143 (in millions):

11

Adoption on Accretion and
Jan. 1, 2003 Depreciation Total
-------------- --------------- ------------

Assets:
Electric plant in service - IP&L $24 $-- $24
Electric plant in service - WP&L 24 -- 24
Utility accumulated depreciation - IP&L 106 -- 106
Utility accumulated depreciation - WP&L 148 -- 148
Other assets - regulatory assets - IP&L 50 7 57
Other assets - regulatory assets - WP&L 3 6 9
------------
Total assets $368
============
Liabilities:
AROs - IP&L $180 $7 $187
AROs - WP&L 175 6 181
------------
Total liabilities $368
============

As it relates to regulated operations, Alliant Energy believes it is
probable that any differences between expenses under SFAS 143 and expenses
recovered currently in rates will be recoverable in future rates, and is
deferring such expenses as a regulatory asset.

Upon adoption of SFAS 143, Alliant Energy also recognized a $3.9 million
impact as a cumulative effect of a change in accounting principle at its oil
and gas business (the business was reported as an asset held for sale and a
discontinued operation at June 30, 2003).

IP&L and WP&L have previously recognized removal costs as a component of
depreciation expense and accumulated depreciation for other non-nuclear
assets that do not have associated legal retirement obligations with
regulatory rate recovery. As of Jan. 1, 2003, IP&L and WP&L estimate that
they had approximately $275 million and $140 million, respectively, of such
regulatory liabilities recorded in "Accumulated depreciation" on their
Consolidated Balance Sheets.

If SFAS 143 had been adopted as of Jan. 1, 2000, IP&L and WP&L would have
recorded ARO SFAS 143 liabilities of approximately $180 million and $175
million at Dec. 31, 2002, $168 million and $161 million at Dec. 31, 2001 and
$157 million and $147 million at Dec. 31, 2000, respectively.

12. Alliant Energy's natural gas marketing business, NG Energy, is impacted
by EITF Issue 02-3, which requires that all sales of energy and the related
cost of energy purchased under contracts that meet the definition of energy
trading contracts and that are derivatives under SFAS 133, must be reflected
on a net basis in the income statement for all periods presented. Under the
guidance of EITF Issue 98-10, Alliant Energy had reported its energy trading
contracts and related gas in storage at fair market value, and reported
related revenues and expenses on a gross basis in the income statement. EITF
Issue 02-3 rescinded EITF Issue 98-10 on a prospective basis. Accordingly,
any new contracts entered into after Oct. 25, 2002 have been reported on a
historical cost basis rather than at fair market value unless the contract
meets the definition of a derivative under SFAS 133. Alliant Energy adopted
EITF Issue 02-3 on Jan. 1, 2003 for all contracts that were in place and
storage gas acquired prior to Oct. 25, 2002, and reclassified prior period
trading contracts on a net basis in the income statement. The impact of
transitioning from reporting inventory and existing contracts that were not
derivatives under SFAS 133 at fair value to historical cost resulted in a
cumulative effect charge of $2.1 million (net of a deferred tax benefit of
$1.4 million) in the first quarter of 2003. Commencing January 1, 2003, NG
Energy has very few contracts that are accounted for as derivatives under
SFAS 133 and that are also classified as trading contracts, therefore almost
all of its sales of energy and cost of sales in the first six months of 2003
are reported on a gross basis. Because substantially all of its contracts
prior to 2003 were classified as trading contracts under EITF Issue 98-10,
primarily all of its sales of energy and cost of sales for the first six
months of 2002 are reported on a net basis. For the six months ended June
30, 2002, NG Energy recorded $2 million of net revenues related to $43
million of gross revenues, less $41 million of gas costs.

13. Alliant Energy has fully and unconditionally guaranteed the payment of
principal and interest on various debt securities issued by Resources and,
as a result, is required to present condensed consolidating financial
statements. No Alliant Energy subsidiaries are guarantors of Resources' debt
securities. Alliant Energy's condensed consolidating financial statements
are as follows:
12

Alliant Energy Corporation Condensed Consolidating Statements of Income for the Three Months Ended June 30, 2003 and 2002

Alliant Energy Other Alliant Consolidated
Parent Energy Consolidating Alliant
Company Resources Subsidiaries Adjustments Energy
--------------------------------------------------------------------
Three Months Ended June 30, 2003 (in thousands)
- --------------------------------

Operating revenues:
Electric utility $- $- $444,108 $- $444,108
Gas utility - - 76,392 - 76,392
Non-regulated and other - 117,602 99,649 (91,459) 125,792
--------------------------------------------------------------------
- 117,602 620,149 (91,459) 646,292
--------------------------------------------------------------------
Operating expenses:
Electric and steam production fuels - - 87,239 (11) 87,228
Purchased power - - 87,504 549 88,053
Cost of utility gas sold - - 49,744 - 49,744
Other operation and maintenance 846 108,080 237,914 (81,285) 265,555
Depreciation and amortization 10 8,836 73,219 (4,080) 77,985
Taxes other than income taxes 3 1,673 21,051 (1,942) 20,785
--------------------------------------------------------------------
859 118,589 556,671 (86,769) 589,350
--------------------------------------------------------------------
Operating income (loss) (859) (987) 63,478 (4,690) 56,942
--------------------------------------------------------------------
Interest expense and other:
Interest expense 2,637 26,864 28,305 (1,608) 56,198
Interest income from loans to discontinued operations, net - (27) - - (27)
Equity income from unconsolidated investments - (3,494) (4,434) (1,309) (9,237)
Allowance for funds used during construction - - (4,606) 34 (4,572)
Preferred dividend requirements of subsidiaries - - 3,968 - 3,968
Miscellaneous, net (40,875) (5,570) 788 38,323 (7,334)
--------------------------------------------------------------------
(38,238) 17,773 24,021 35,440 38,996
--------------------------------------------------------------------
Income (loss) from continuing operations before income taxes 37,379 (18,760) 39,457 (40,130) 17,946
--------------------------------------------------------------------
Income tax expense (benefit) 5,225 (16,556) 17,421 127 6,217
--------------------------------------------------------------------
Income (loss) from continuing operations 32,154 (2,204) 22,036 (40,257) 11,729
--------------------------------------------------------------------
Income from discontinued operations, net of tax - 20,425 - - 20,425
--------------------------------------------------------------------
Net income $32,154 $18,221 $22,036 ($40,257) $32,154
====================================================================

Three Months Ended June 30, 2002
- --------------------------------
Operating revenues:
Electric utility $- $- $412,650 $- $412,650
Gas utility - - 65,366 - 65,366
Non-regulated and other - 59,596 83,609 (76,761) 66,444
--------------------------------------------------------------------
- 59,596 561,625 (76,761) 544,460
--------------------------------------------------------------------
Operating expenses:
Electric and steam production fuels - - 75,148 - 75,148
Purchased power - - 91,496 - 91,496
Cost of utility gas sold - - 38,719 - 38,719
Other operation and maintenance 424 53,269 204,677 (75,434) 182,936
Depreciation and amortization - 7,165 63,401 - 70,566
Taxes other than income taxes - 1,496 25,009 (1,311) 25,194
--------------------------------------------------------------------
424 61,930 498,450 (76,745) 484,059
--------------------------------------------------------------------
Operating income (loss) (424) (2,334) 63,175 (16) 60,401
--------------------------------------------------------------------
Interest expense and other:
Interest expense 973 18,802 27,789 (1,528) 46,036
Interest income from loans to discontinued operations, net - (4,234) - - (4,234)
Equity (income) loss from unconsolidated investments 321 9,967 (3,479) - 6,809
Allowance for funds used during construction - - (1,696) - (1,696)
Preferred dividend requirements of subsidiaries - - 1,682 - 1,682
Impairment of available-for-sale securities of McLeodUSA Inc. - 6,044 - - 6,044
Miscellaneous, net (14,793) 8,623 (1,360) 14,932 7,402
--------------------------------------------------------------------
(13,499) 39,202 22,936 13,404 62,043
--------------------------------------------------------------------
Income (loss) from continuing operations before income taxes 13,075 (41,536) 40,239 (13,420) (1,642)
--------------------------------------------------------------------
Income tax expense (benefit) 6,760 (16,175) 13,297 (16) 3,866
--------------------------------------------------------------------
Income (loss) from continuing operations 6,315 (25,361) 26,942 (13,404) (5,508)
--------------------------------------------------------------------
Income from discontinued operations, net of tax - 11,823 - - 11,823
--------------------------------------------------------------------
Net income (loss) $6,315 ($13,538) $26,942 ($13,404) $6,315
====================================================================

13

Alliant Energy Corporation Condensed Consolidating Statements of Income for the Six Months Ended June 30, 2003 and 2002

Alliant Energy Other Alliant Consolidated
Parent Energy Consolidating Alliant
Company Resources Subsidiaries Adjustments Energy
------------------------------------------------------------------
Six Months Ended June 30, 2003 (in thousands)
- ------------------------------

Operating revenues:
Electric utility $- $- $887,133 $- $887,133
Gas utility - - 334,273 - 334,273
Non-regulated and other - 303,155 197,835 (180,314) 320,676
------------------------------------------------------------------
- 303,155 1,419,241 (180,314) 1,542,082
------------------------------------------------------------------
Operating expenses:
Electric and steam production fuels - - 159,670 (27) 159,643
Purchased power - - 217,883 549 218,432
Cost of utility gas sold - - 238,069 - 238,069
Other operation and maintenance 1,159 275,344 464,153 (158,146) 582,510
Depreciation and amortization 18 16,955 148,556 (7,945) 157,584
Taxes other than income taxes 5 3,401 47,327 (3,872) 46,861
------------------------------------------------------------------
1,182 295,700 1,275,658 (169,441) 1,403,099
------------------------------------------------------------------
Operating income (loss) (1,182) 7,455 143,583 (10,873) 138,983
------------------------------------------------------------------
Interest expense and other:
Interest expense 6,537 53,714 55,833 (4,372) 111,712
Interest income from loans to discontinued operations, net - (3,281) - - (3,281)
Equity (income) loss from unconsolidated investments - 4,981 (8,655) (1,309) (4,983)
Allowance for funds used during construction - - (8,514) 81 (8,433)
Preferred dividend requirements of subsidiaries - - 8,126 - 8,126
Miscellaneous, net (48,785) (2,646) 6,303 40,209 (4,919)
------------------------------------------------------------------
(42,248) 52,768 53,093 34,609 98,222
------------------------------------------------------------------
Income (loss) from continuing operations before income taxes 41,066 (45,313) 90,490 (45,482) 40,761
------------------------------------------------------------------
Income tax expense (benefit) 9,390 (32,438) 37,452 (11) 14,393
------------------------------------------------------------------
Income (loss) from continuing operations 31,676 (12,875) 53,038 (45,471) 26,368
------------------------------------------------------------------
Income from discontinued operations, net of tax - 11,291 - - 11,291
------------------------------------------------------------------
Income (loss) before cumulative effect of changes in
accounting principles, net of tax 31,676 (1,584) 53,038 (45,471) 37,659
------------------------------------------------------------------
Cumulative effect of changes in accounting principles, net of tax - (5,983) - - (5,983)
------------------------------------------------------------------
Net income (loss) $31,676 ($7,567) $53,038 ($45,471) $31,676
==================================================================

Six Months Ended June 30, 2002
- ------------------------------
Operating revenues:
Electric utility $- $- $783,412 $- $783,412
Gas utility - - 193,607 - 193,607
Non-regulated and other - 124,058 159,909 (145,090) 138,877
------------------------------------------------------------------
- 124,058 1,136,928 (145,090) 1,115,896
------------------------------------------------------------------
Operating expenses:
Electric and steam production fuels - - 137,758 - 137,758
Purchased power - - 163,833 - 163,833
Cost of utility gas sold - - 122,475 - 122,475
Other operation and maintenance 931 108,091 401,083 (141,637) 368,468
Depreciation and amortization - 13,130 132,985 - 146,115
Taxes other than income taxes - 3,418 52,964 (3,400) 52,982
------------------------------------------------------------------
931 124,639 1,011,098 (145,037) 991,631
------------------------------------------------------------------
Operating income (loss) (931) (581) 125,830 (53) 124,265
------------------------------------------------------------------
Interest expense and other:
Interest expense 1,732 36,509 55,330 (3,048) 90,523
Interest income from loans to discontinued operations, net - (7,600) - - (7,600)
Equity (income) loss from unconsolidated investments 550 11,019 (7,973) - 3,596
Allowance for funds used during construction - - (3,350) - (3,350)
Preferred dividend requirements of subsidiaries - - 3,364 - 3,364
Impairment of available-for-sale securities of McLeodUSA Inc. - 27,218 - - 27,218
Miscellaneous, net (27,551) 24,690 (8,630) 28,497 17,006
------------------------------------------------------------------
(25,269) 91,836 38,741 25,449 130,757
------------------------------------------------------------------
Income (loss) from continuing operations before income taxes 24,338 (92,417) 87,089 (25,502) (6,492)
------------------------------------------------------------------
Income tax expense (benefit) 8,280 (34,569) 33,149 (53) 6,807
------------------------------------------------------------------
Income (loss) from continuing operations 16,058 (57,848) 53,940 (25,449) (13,299)
------------------------------------------------------------------
Income from discontinued operations, net of tax - 29,357 - - 29,357
------------------------------------------------------------------
Net income (loss) $16,058 ($28,491) $53,940 ($25,449) $16,058
==================================================================

14

Alliant Energy Corporation Condensed Consolidating Balance Sheet as of June 30, 2003

Alliant Energy Other Consolidated
Parent Alliant Energy Consolidating Alliant
Company Resources Subsidiaries Adjustments Energy
---------------------------------------------------------------------------------
(in thousands)

ASSETS
Property, plant and equipment:
Utility:
Electric plant in service $- $- $5,513,787 $- $5,513,787
Other plant in service - - 1,178,425 - 1,178,425
Accumulated depreciation - - (3,439,286) - (3,439,286)
Construction work in progress:
Power Iowa generating facility - - 186,277 - 186,277
Other - - 238,141 - 238,141
Other, net - - 64,720 - 64,720
---------------------------------------------------------------------------------
Total utility - - 3,742,064 - 3,742,064
---------------------------------------------------------------------------------
Non-regulated and other, net:
Non-regulated generation - 209,326 - - 209,326
Other - 320,433 70,225 (111) 390,547
---------------------------------------------------------------------------------
Total non-regulated and other - 529,759 70,225 (111) 599,873
---------------------------------------------------------------------------------
- 529,759 3,812,289 (111) 4,341,937
---------------------------------------------------------------------------------
Current assets:
Income tax refunds receivable 24,825 92,339 26,638 - 143,802
Gas stored underground, at average cost - 16,211 30,445 - 46,656
Regulatory assets - - 59,731 - 59,731
Assets of discontinued operations - 633,840 - - 633,840
Other 132,803 178,489 398,126 (298,421) 410,997
---------------------------------------------------------------------------------
157,628 920,879 514,940 (298,421) 1,295,026
---------------------------------------------------------------------------------
Investments:
Consolidated subsidiaries 1,864,611 - 10 (1,864,621) -
Other 12,037 510,849 520,660 - 1,043,546
---------------------------------------------------------------------------------
1,876,648 510,849 520,670 (1,864,621) 1,043,546
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Deferred charges and other 1,138 127,620 609,971 (35,703) 703,026
---------------------------------------------------------------------------------
Total assets $2,035,414 $2,089,107 $5,457,870 ($2,198,856) $7,383,535
=================================================================================

CAPITALIZATION AND LIABILITIES
Capitalization:
Common stock and additional paid-in capital $1,309,121 $232,743 $906,128 ($1,138,871) $1,309,121
Retained earnings 743,698 107,271 752,514 (859,785) 743,698
Accumulated other comprehensive loss (133,931) (90,619) (43,312) 133,931 (133,931)
Shares in deferred compensation trust (7,181) - - - (7,181)
---------------------------------------------------------------------------------
Total common equity 1,911,707 249,395 1,615,330 (1,864,725) 1,911,707
---------------------------------------------------------------------------------
Cumulative preferred stock of subsidiaries, net - - 205,063 - 205,063
Long-term debt (excluding current portion) 24,000 1,130,757 1,233,680 - 2,388,437
---------------------------------------------------------------------------------
1,935,707 1,380,152 3,054,073 (1,864,725) 4,505,207
---------------------------------------------------------------------------------
Current liabilities:
Current maturities and sinking funds - 6,439 64,400 - 70,839
Commercial paper 86,000 - 230,400 - 316,400
Other short-term borrowings - 74,017 73,613 (123,626) 24,004
Liabilities of discontinued operations - 204,671 - - 204,671
Other 10,567 185,194 608,236 (174,795) 629,202
---------------------------------------------------------------------------------
96,567 470,321 976,649 (298,421) 1,245,116
---------------------------------------------------------------------------------
Other long-term liabilities and deferred credits:
Asset retirement obligations - - 368,040 - 368,040
Other 3,140 192,835 1,059,108 (35,710) 1,219,373
---------------------------------------------------------------------------------
3,140 192,835 1,427,148 (35,710) 1,587,413
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Minority interest - 45,799 - - 45,799
---------------------------------------------------------------------------------
Total capitalization and liabilities $2,035,414 $2,089,107 $5,457,870 ($2,198,856) $7,383,535
=================================================================================

15

Alliant Energy Corporation Condensed Consolidating Balance Sheet as of December 31, 2002

Alliant Energy Other Consolidated
Parent Alliant Energy Consolidating Alliant
Company Resources Subsidiaries Adjustments Energy
-----------------------------------------------------------------------------------
(in thousands)

ASSETS
Property, plant and equipment:
Utility:
Electric plant in service $- $- $5,295,381 $- $5,295,381
Other plant in service - - 1,143,578 - 1,143,578
Accumulated depreciation - - (3,573,407) - (3,573,407)
Construction work in progress:
Power Iowa generating facility - - 10,651 - 10,651
Other - - 252,445 - 252,445
Other, net - - 68,340 - 68,340
-----------------------------------------------------------------------------------
Total utility - - 3,196,988 - 3,196,988
-----------------------------------------------------------------------------------
Non-regulated and other, net:
Non-regulated generation - 156,699 - - 156,699
Other - 299,355 75,503 (111) 374,747
-----------------------------------------------------------------------------------
Total non-regulated and other - 456,054 75,503 (111) 531,446
-----------------------------------------------------------------------------------
- 456,054 3,272,491 (111) 3,728,434
-----------------------------------------------------------------------------------
Current assets:
Income tax refunds receivable 18,175 72,882 6,412 - 97,469
Gas stored underground, at average cost - 26,668 36,129 - 62,797
Regulatory assets - - 46,076 - 46,076
Assets of discontinued operations - 969,291 - - 969,291
Other 254,461 177,538 453,052 (436,395) 448,656
-----------------------------------------------------------------------------------
272,636 1,246,379 541,669 (436,395) 1,624,289
-----------------------------------------------------------------------------------
Investments:
Consolidated subsidiaries 1,817,341 - 10 (1,817,351) -
Other 11,660 430,173 494,867 - 936,700
-----------------------------------------------------------------------------------
1,829,001 430,173 494,877 (1,817,351) 936,700
-----------------------------------------------------------------------------------
-----------------------------------------------------------------------------------
Deferred charges and other - 127,834 611,721 (27,583) 711,972
-----------------------------------------------------------------------------------
Total assets $2,101,637 $2,260,440 $4,920,758 ($2,281,440) $7,001,395
===================================================================================

CAPITALIZATION AND LIABILITIES
Capitalization:
Common stock and additional paid-in capital $1,294,842 $232,743 $906,261 ($1,139,004) $1,294,842
Retained earnings 758,187 114,838 773,556 (888,394) 758,187
Accumulated other comprehensive loss (209,943) (166,947) (42,996) 209,943 (209,943)
Shares in deferred compensation trust (6,896) - - - (6,896)
-----------------------------------------------------------------------------------
Total common equity 1,836,190 180,634 1,636,821 (1,817,455) 1,836,190
-----------------------------------------------------------------------------------

Cumulative preferred stock of subsidiaries, net - - 205,063 - 205,063
Long-term debt (excluding current portion) 24,000 1,290,205 1,295,598 - 2,609,803
-----------------------------------------------------------------------------------
1,860,190 1,470,839 3,137,482 (1,817,455) 4,651,056
-----------------------------------------------------------------------------------
Current liabilities:
Current maturities and sinking funds - 41,511 5,080 - 46,591
Commercial paper 135,500 - 60,000 - 195,500
Other short-term borrowings 85,000 194,482 79,003 (244,764) 113,721
Liabilities of discontinued operations - 138,251 - - 138,251
Other 17,696 190,587 611,595 (191,631) 628,247
-----------------------------------------------------------------------------------
238,196 564,831 755,678 (436,395) 1,122,310
-----------------------------------------------------------------------------------
-----------------------------------------------------------------------------------
Other long-term liabilities and deferred credits 3,251 181,345 1,027,598 (27,590) 1,184,604
-----------------------------------------------------------------------------------
-----------------------------------------------------------------------------------
Minority interest - 43,425 - - 43,425
-----------------------------------------------------------------------------------
Total capitalization and liabilities $2,101,637 $2,260,440 $4,920,758 ($2,281,440) $7,001,395
===================================================================================

16

Alliant Energy Corporation Condensed Consolidating Statements of Cash Flows for the Six Months Ended June 30, 2003 and 2002

Alliant Energy Other Alliant Consolidated
Parent Energy Consolidating Alliant
Company Resources Subsidiaries Adjustments Energy
-------------------------------------------------------------------
Six Months Ended June 30, 2003 (in thousands)
- ------------------------------

Net cash flows from (used for) operating activities $21,622 ($37,485) $290,180 ($53,597) $220,720
------------------------------------------------------------------
Cash flows from (used for) financing activities:
Common stock dividends (46,165) - (74,079) 74,079 (46,165)
Proceeds from issuance of other long-term debt - 60,000 - - 60,000
Net change in commercial paper and other short-term borrowings (13,362) (120,465) 165,010 - 31,183
Net change in loans to discontinued operations - (25,181) - - (25,181)
Other 11,316 (1,655) (28,402) 8,260 (10,481)
------------------------------------------------------------------
Net cash flows from (used for) financing activities (48,211) (87,301) 62,529 82,339 9,356
------------------------------------------------------------------
Cash flows from (used for) investing activities:
Construction and acquisition expenditures:
Regulated domestic utilities - - (371,847) 108,847 (263,000)
Non-regulated businesses - (212,305) - - (212,305)
Corporate Services and other (50) - (2,692) - (2,742)
Proceeds from asset dispositions - 352,579 488 (108,847) 244,220
Other 28,582 (3,305) 11,593 (28,742) 8,128
------------------------------------------------------------------
Net cash flows from (used for) investing activities 28,532 136,969 (362,458) (28,742) (225,699)
------------------------------------------------------------------
Net increase (decrease) in cash and temporary cash investments 1,943 12,183 (9,749) - 4,377
------------------------------------------------------------------
Cash and temporary cash investments at beginning of period 4 47,236 15,619 - 62,859
------------------------------------------------------------------
Cash and temporary cash investments at end of period $1,947 $59,419 $5,870 $- $67,236
==================================================================
Supplemental cash flows information:
Cash paid (received) during the period for:
Interest $6,620 $38,435 $51,787 $- $96,842
==================================================================
Income taxes, net of refunds $13,890 ($18,336) $32,670 $- $28,224
==================================================================
Noncash investing and financing activities:
Debt extinguished directly by sale of Australian business $- $127,595 $- $- $127,595
==================================================================
Capital lease obligations incurred $- $- $2,377 $- $2,377
==================================================================

Six Months Ended June 30, 2002
- ------------------------------
Net cash flows from (used for) operating activities ($8,931) $20,334 $279,741 ($28,814) $262,330
------------------------------------------------------------------
Cash flows from (used for) financing activities:
Common stock dividends (89,891) - (69,731) 69,731 (89,891)
Net change in Resources' credit facility - 192,761 - - 192,761
Net change in commercial paper and other short-term borrowings 20,827 (15,862) 24,580 1,939 31,484
Net change in loans to discontinued operations - (112,601) - - (112,601)
Other 28,748 (12,590) (13,167) 2,857 5,848
------------------------------------------------------------------
Net cash flows from (used for) financing activities (40,316) 51,708 (58,318) 74,527 27,601
------------------------------------------------------------------
Cash flows from (used for) investing activities:
Construction and acquisition expenditures:
Regulated domestic utilities - - (173,774) - (173,774)
Non-regulated businesses - (113,406) - - (113,406)
Corporate Services and other - - (16,903) - (16,903)
Proceeds from asset dispositions 81 1,641 - - 1,722
Other 43,756 25,106 (29,751) (43,774) (4,663)
------------------------------------------------------------------
Net cash flows from (used for) investing activities 43,837 (86,659) (220,428) (43,774) (307,024)
------------------------------------------------------------------
Net increase (decrease) in cash and temporary cash investments (5,410) (14,617) 995 1,939 (17,093)
------------------------------------------------------------------
Cash and temporary cash investments at beginning of period 6,381 60,237 3,207 (1,939) 67,886
------------------------------------------------------------------
Cash and temporary cash investments at end of period $971 $45,620 $4,202 $- $50,793
==================================================================
Supplemental cash flows information:
Cash paid during the period for:
Interest $1,618 $37,265 $50,245 $- $89,128
==================================================================
Income taxes, net of refunds $- $1,428 $4,451 $- $5,879
==================================================================
Noncash investing and financing activities:
Capital lease obligations incurred $- $- $473 $- $473
==================================================================

17

INTERSTATE POWER AND LIGHT COMPANY
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)

For the Three Months For the Six Months
Ended June 30, Ended June 30,
2003 2002 2003 2002
- ------------------------------------------------------------------------------------------------------------------------------
(in thousands)

Operating revenues:
Electric utility $234,716 $226,266 $465,045 $425,269
Gas utility 40,665 35,512 167,342 107,254
Steam 8,264 7,500 17,746 15,550
--------------- --------------- --------------- ---------------
283,645 269,278 650,133 548,073
--------------- --------------- --------------- ---------------
- ------------------------------------------------------------------------------------------------------------------------------
Operating expenses:
Electric and steam production fuels 53,126 43,360 87,327 75,702
Purchased power 37,438 37,062 82,494 65,221
Cost of gas sold 27,222 22,210 118,993 68,570
Other operation and maintenance 84,976 80,037 169,563 160,693
Depreciation and amortization 40,990 36,341 81,417 72,552
Taxes other than income taxes 12,385 16,103 28,085 33,019
--------------- --------------- --------------- ---------------
256,137 235,113 567,879 475,757
--------------- --------------- --------------- ---------------
- ------------------------------------------------------------------------------------------------------------------------------
Operating income 27,508 34,165 82,254 72,316
--------------- --------------- --------------- ---------------
- ------------------------------------------------------------------------------------------------------------------------------
Interest expense and other:
Interest expense 17,130 16,718 34,174 32,992
Allowance for funds used during construction (3,516) (1,437) (6,060) (2,417)
Miscellaneous, net 593 (3,271) (207) (3,699)
--------------- --------------- --------------- ---------------
14,207 12,010 27,907 26,876
--------------- --------------- --------------- ---------------
- ------------------------------------------------------------------------------------------------------------------------------
Income before income taxes 13,301 22,155 54,347 45,440
--------------- --------------- --------------- ---------------
- ------------------------------------------------------------------------------------------------------------------------------
Income taxes 5,429 6,354 21,518 16,764
--------------- --------------- --------------- ---------------
- ------------------------------------------------------------------------------------------------------------------------------
Net income 7,872 15,801 32,829 28,676
--------------- --------------- --------------- ---------------
- ------------------------------------------------------------------------------------------------------------------------------
Preferred dividend requirements 3,140 853 6,470 1,708
--------------- --------------- --------------- ---------------
- ------------------------------------------------------------------------------------------------------------------------------
Earnings available for common stock $4,732 $14,948 $26,359 $26,968
=============== =============== =============== ===============
- ------------------------------------------------------------------------------------------------------------------------------

The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.

18

INTERSTATE POWER AND LIGHT COMPANY
CONSOLIDATED BALANCE SHEETS (UNAUDITED)

June 30, December 31,
ASSETS 2003 2002
- ------------------------------------------------------------------------------------------------------------------
(in thousands)

Property, plant and equipment:
Electric plant in service $3,581,691 $3,451,547
Gas plant in service 334,875 326,470
Steam plant in service 59,737 59,737
Other plant in service 204,063 195,328
Accumulated depreciation (2,124,261) (2,163,371)
------------------ -----------------
Net plant 2,056,105 1,869,711
Construction work in progress:
Power Iowa generating facility 186,277 10,651
Other 147,674 155,699
Other, net 46,979 50,529
------------------ -----------------
2,437,035 2,086,590
------------------ -----------------
- ------------------------------------------------------------------------------------------------------------------
Current assets:
Cash and temporary cash investments 3,725 6,076
Accounts receivable:
Customer, less allowance for doubtful accounts of $1,562 and $894 14,436 42,647
Associated companies 30,246 79,105
Other, less allowance for doubtful accounts of $312 and $388 28,045 27,898
Income tax refunds receivable 22,432 6,412
Production fuel, at average cost 38,084 36,852
Materials and supplies, at average cost 34,876 28,821
Gas stored underground, at average cost 12,650 19,450
Regulatory assets 32,999 18,077
Prepayments and other 8,942 7,529
------------------ -----------------
226,435 272,867
------------------ -----------------
- ------------------------------------------------------------------------------------------------------------------
Investments:
Nuclear decommissioning trust funds 133,865 121,158
Other 13,502 13,492
------------------ -----------------
147,367 134,650
------------------ -----------------
- ------------------------------------------------------------------------------------------------------------------
Other assets:
Regulatory assets 242,801 199,691
Deferred charges and other 37,942 44,608
------------------ -----------------
280,743 244,299
------------------ -----------------
- ------------------------------------------------------------------------------------------------------------------
Total assets $3,091,580 $2,738,406
================== =================
- ------------------------------------------------------------------------------------------------------------------

The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.

19

INTERSTATE POWER AND LIGHT COMPANY
CONSOLIDATED BALANCE SHEETS (UNAUDITED) (Continued)

June 30, December 31,
CAPITALIZATION AND LIABILITIES 2003 2002
- --------------------------------------------------------------------------------------------------------------------
(in thousands, except share amounts)

Capitalization:
Common stock - $2.50 par value - authorized 24,000,000
shares; 13,370,788 shares outstanding $33,427 $33,427
Additional paid-in capital 477,542 477,701
Retained earnings 357,699 374,428
Accumulated other comprehensive loss (18,887) (18,887)
------------------ ------------------
Total common equity 849,781 866,669
------------------ ------------------

Cumulative preferred stock 145,100 145,100
Long-term debt (excluding current portion) 827,409 827,389
------------------ ------------------
1,822,290 1,839,158
------------------ ------------------

- --------------------------------------------------------------------------------------------------------------------

Current liabilities:
Current maturities and sinking funds 2,400 5,080
Commercial paper 155,900 -
Accounts payable 90,165 83,126
Accounts payable to associated companies 48,786 41,537
Accrued interest 14,738 14,628
Accrued taxes 60,363 62,135
Accumulated refueling outage provision 2,454 13,845
Other 46,686 40,946
------------------ ------------------
421,492 261,297
------------------ ------------------

- --------------------------------------------------------------------------------------------------------------------

Other long-term liabilities and deferred credits:
Accumulated deferred income taxes 334,369 313,308
Accumulated deferred investment tax credits 29,374 31,135
Asset retirement obligations 186,852 -
Pension and other benefit obligations 97,271 88,449
Regulatory liabilities 75,957 78,995
Environmental liabilities 35,848 39,849
Other 88,127 86,215
------------------ ------------------
847,798 637,951
------------------ ------------------

- --------------------------------------------------------------------------------------------------------------------

Total capitalization and liabilities $3,091,580 $2,738,406
================== ==================

- --------------------------------------------------------------------------------------------------------------------

The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.

20

INTERSTATE POWER AND LIGHT COMPANY
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

For the Six Months Ended June 30,
2003 2002
- -------------------------------------------------------------------------------------------------------------
(in thousands)

Cash flows from operating activities:
Net income $32,829 $28,676
Adjustments to reconcile net income to net cash
flows from operating activities:
Depreciation and amortization 81,417 72,552
Amortization of leased nuclear fuel 5,751 7,537
Deferred tax expense (benefit) and investment tax (credits) 17,320 (4,617)
Refueling outage provision (11,391) 3,972
Other (317) 2,306
Other changes in assets and liabilities:
Accounts receivable 76,923 (257)
Income tax refunds receivable (16,020) -
Gas stored underground 6,800 10,452
Adjustment clause balances (10,027) (6,301)
Other 14,182 26,172
------------------ ------------------
Net cash flows from operating activities 197,467 140,492
------------------ ------------------
- -------------------------------------------------------------------------------------------------------------
Cash flows from (used for) financing activities:
Common stock dividends (43,088) (40,170)
Preferred stock dividends (6,470) (1,708)
Reductions in long-term debt (1,680) (560)
Net change in short-term borrowings 155,900 25,045
Principal payments under capital lease obligations (6,934) (7,156)
Other (625) (172)
------------------ ------------------
Net cash flows from (used for) financing activities 97,103 (24,721)
------------------ ------------------
- -------------------------------------------------------------------------------------------------------------
Cash flows used for investing activities:
Utility construction expenditures (298,247) (104,743)
Nuclear decommissioning trust funds (5,473) (3,004)
Other 6,799 (8,030)
------------------ ------------------
Net cash flows used for investing activities (296,921) (115,777)
------------------ ------------------
- -------------------------------------------------------------------------------------------------------------
Net decrease in cash and temporary cash investments (2,351) (6)
------------------ ------------------
- -------------------------------------------------------------------------------------------------------------
Cash and temporary cash investments at beginning of period 6,076 87
------------------ ------------------
- -------------------------------------------------------------------------------------------------------------
Cash and temporary cash investments at end of period $3,725 $81
================== ==================
- -------------------------------------------------------------------------------------------------------------
Supplemental cash flows information:
Cash paid during the period for:
Interest $31,608 $30,578
================== ==================
Income taxes, net of refunds $9,065 $ -
================== ==================
Noncash investing and financing activities:
Capital lease obligations incurred $2,377 $473
================== ==================
- -------------------------------------------------------------------------------------------------------------

The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.

21

INTERSTATE POWER AND LIGHT COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Except as modified below, the Alliant Energy Notes to Consolidated
Financial Statements are incorporated by reference insofar as they relate
to IP&L.

1. The interim consolidated financial statements included herein have been
prepared by IP&L, without audit, pursuant to the rules and regulations of
the SEC. Accordingly, certain information and footnote disclosures
normally included in financial statements prepared in accordance with GAAP
have been condensed or omitted, although management believes that the
disclosures are adequate to make the information presented not misleading.
The consolidated financial statements include IP&L and its consolidated
subsidiaries. IP&L is a direct subsidiary of Alliant Energy. These
financial statements should be read in conjunction with the financial
statements and the notes thereto included in IP&L's latest Annual Report on
Form 10-K.

In the opinion of management, all adjustments, which are normal and
recurring in nature, necessary for a fair presentation of (a) the
consolidated results of operations for the three and six months ended June
30, 2003 and 2002, (b) the consolidated financial position at June 30, 2003
and Dec. 31, 2002, and (c) the consolidated statement of cash flows for the
six months ended June 30, 2003 and 2002, have been made. Because of the
seasonal nature of IP&L's operations, results for the three and six months
ended June 30, 2003 are not necessarily indicative of results that may be
expected for the year ending Dec. 31, 2003. Certain prior period amounts
have been reclassified on a basis consistent with the current period
presentation.

2. For the three and six months ended June 30, 2003 and 2002, IP&L had no
other comprehensive income, thus IP&L's comprehensive income was equal to
its earnings available for common stock for all periods.

3. Certain financial information relating to IP&L's significant business
segments is presented below. Intersegment revenues were not material to
IP&L's operations.

Electric Gas Other Total
-------------------------------------------------------
(in thousands)

Three Months Ended June 30, 2003
--------------------------------
Operating revenues $234,716 $40,665 $8,264 $283,645
Operating income (loss) 29,071 (3,261) 1,698 27,508
Earnings available for common stock 4,732

Three Months Ended June 30, 2002
--------------------------------
Operating revenues $226,266 $35,512 $7,500 $269,278
Operating income (loss) 33,497 (655) 1,323 34,165
Earnings available for common stock 14,948

Six Months Ended June 30, 2003
------------------------------
Operating revenues $465,045 $167,342 $17,746 $650,133
Operating income 67,101 12,182 2,971 82,254
Earnings available for common stock 26,359

Six Months Ended June 30, 2002
------------------------------
Operating revenues $425,269 $107,254 $15,550 $548,073
Operating income 61,395 7,525 3,396 72,316
Earnings available for common stock 26,968

10. IP&L utilizes several synthetic leases to finance certain utility
railcars that were not included on IP&L's Consolidated Balance Sheets.
IP&L has guaranteed the residual value of its synthetic leases totaling
$6.8 million in the aggregate. The guarantees extend through the maturity
of each respective underlying lease, the latest of which is January 2009.

22

WISCONSIN POWER AND LIGHT COMPANY
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)

For the Three Months For the Six Months
Ended June 30, Ended June 30,
2003 2002 2003 2002
- ------------------------------------------------------------------------------------------------------------------------------
(in thousands)

Operating revenues:
Electric utility $209,392 $186,384 $422,088 $358,143
Gas utility 35,727 29,854 166,931 86,353
Water 1,400 1,228 2,777 2,518
--------------- --------------- --------------- ---------------
246,519 217,466 591,796 447,014
--------------- --------------- --------------- ---------------
- ------------------------------------------------------------------------------------------------------------------------------
Operating expenses:
Electric production fuels 34,102 31,787 72,316 62,056
Purchased power 50,615 54,435 135,938 98,612
Cost of gas sold 22,522 16,509 119,076 53,905
Other operation and maintenance 71,837 51,489 138,820 102,729
Depreciation and amortization 28,150 27,060 59,195 60,433
Taxes other than income taxes 6,723 7,596 15,368 16,546
--------------- --------------- --------------- ---------------
213,949 188,876 540,713 394,281
--------------- --------------- --------------- ---------------
- ------------------------------------------------------------------------------------------------------------------------------
Operating income 32,570 28,590 51,083 52,733
--------------- --------------- --------------- ---------------
- ------------------------------------------------------------------------------------------------------------------------------
Interest expense and other:
Interest expense 10,509 9,952 20,215 20,148
Interest income (1,886) 882 (3,741) (5,663)
Equity income from unconsolidated investments (5,664) (3,486) (9,780) (7,873)
Allowance for funds used during construction (1,056) (259) (2,373) (933)
Miscellaneous, net (1,304) 1,785 872 2,189
--------------- --------------- --------------- ---------------
599 8,874 5,193 7,868
--------------- --------------- --------------- ---------------
- ------------------------------------------------------------------------------------------------------------------------------
Income before income taxes 31,971 19,716 45,890 44,865
--------------- --------------- --------------- ---------------
- ------------------------------------------------------------------------------------------------------------------------------
Income taxes 12,118 6,927 15,922 16,331
--------------- --------------- --------------- ---------------
- ------------------------------------------------------------------------------------------------------------------------------
Net income 19,853 12,789 29,968 28,534
--------------- --------------- --------------- ---------------
- ------------------------------------------------------------------------------------------------------------------------------
Preferred dividend requirements 828 828 1,656 1,656
--------------- --------------- --------------- ---------------
- ------------------------------------------------------------------------------------------------------------------------------
Earnings available for common stock $19,025 $11,961 $28,312 $26,878
=============== =============== =============== ===============
- ------------------------------------------------------------------------------------------------------------------------------

The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.

23

WISCONSIN POWER AND LIGHT COMPANY
CONSOLIDATED BALANCE SHEETS (UNAUDITED)

June 30, December 31,
ASSETS 2003 2002
- --------------------------------------------------------------------------------------------------------------
(in thousands)

Property, plant and equipment:
Electric plant in service $1,932,096 $1,843,834
Gas plant in service 293,776 286,652
Water plant in service 33,747 33,062
Other plant in service 252,227 242,329
Accumulated depreciation (1,315,025) (1,410,036)
---------------- ---------------
Net plant 1,196,821 995,841
Construction work in progress 90,467 96,746
Other, net 17,741 17,811
---------------- ---------------
1,305,029 1,110,398
---------------- ---------------
- --------------------------------------------------------------------------------------------------------------
Current assets:
Cash and temporary cash investments 75 8,577
Accounts receivable:
Customer, less allowance for doubtful accounts of $1,571 and $1,770 1,880 7,977
Associated companies 32,299 21,484
Other, less allowance for doubtful accounts of $414 and $458 18,973 18,191
Production fuel, at average cost 13,285 18,980
Materials and supplies, at average cost 24,863 22,133
Gas stored underground, at average cost 17,795 16,679
Regulatory assets 26,732 27,999
Prepaid gross receipts tax 27,864 27,388
Other 8,852 8,599
---------------- ---------------
172,618 178,007
---------------- ---------------
- --------------------------------------------------------------------------------------------------------------
Investments:
Nuclear decommissioning trust funds 233,139 223,734
Investment in ATC and other 136,565 133,043
---------------- ---------------
369,704 356,777
---------------- ---------------
- --------------------------------------------------------------------------------------------------------------
Other assets:
Regulatory assets 94,772 102,674
Deferred charges and other 204,424 236,741
---------------- ---------------
299,196 339,415
---------------- ---------------
- --------------------------------------------------------------------------------------------------------------
Total assets $2,146,547 $1,984,597
================ ===============
- --------------------------------------------------------------------------------------------------------------

The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.

24

WISCONSIN POWER AND LIGHT COMPANY
CONSOLIDATED BALANCE SHEETS (UNAUDITED) (Continued)

June 30, December 31,
CAPITALIZATION AND LIABILITIES 2003 2002
- -----------------------------------------------------------------------------------------------------------------
(in thousands, except share amounts)

Capitalization:
Common stock - $5 par value - authorized 18,000,000 shares;
13,236,601 shares outstanding $66,183 $66,183
Additional paid-in capital 325,603 325,603
Retained earnings 396,624 399,302
Accumulated other comprehensive loss (24,425) (24,108)
---------------- ----------------
Total common equity 763,985 766,980
---------------- ----------------

Cumulative preferred stock 59,963 59,963
Long-term debt (excluding current portion) 406,271 468,208
---------------- ----------------
1,230,219 1,295,151
---------------- ----------------

- -----------------------------------------------------------------------------------------------------------------

Current liabilities:
Current maturities 62,000 -
Variable rate demand bonds 55,100 55,100
Commercial paper 74,500 60,000
Accounts payable 53,601 90,869
Accounts payable to associated companies 57,671 43,276
Accrued taxes 9,338 19,353
Regulatory liabilities 13,530 16,938
Other 30,871 29,064
---------------- ----------------
356,611 314,600
---------------- ----------------

- -----------------------------------------------------------------------------------------------------------------

Other long-term liabilities and deferred credits:
Accumulated deferred income taxes 198,938 191,894
Accumulated deferred investment tax credits 22,437 23,241
Asset retirement obligations 181,188 -
Pension and other benefit obligations 61,999 58,921
Customer advances 34,690 36,555
Other 60,465 64,235
---------------- ----------------
559,717 374,846
---------------- ----------------

- -----------------------------------------------------------------------------------------------------------------

Total capitalization and liabilities $2,146,547 $1,984,597
================ ================

- -----------------------------------------------------------------------------------------------------------------

The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.

25

WISCONSIN POWER AND LIGHT COMPANY
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

For the Six Months Ended June 30,
2003 2002
- --------------------------------------------------------------------------------------------------------------
(in thousands)

Cash flows from operating activities:
Net income $29,968 $28,534
Adjustments to reconcile net income to net cash
flows from operating activities:
Depreciation and amortization 59,195 60,433
Amortization of nuclear fuel 2,414 2,880
Amortization of deferred energy efficiency expenditures 20,221 7,181
Deferred tax expense (benefit) and investment tax (credits) 6,224 (5,631)
Equity income from unconsolidated investments, net (9,780) (7,873)
Distributions from equity method investments 6,069 7,482
Other (5,189) (5,779)
Other changes in assets and liabilities:
Accounts receivable (5,500) 18,951
Gas stored underground (1,116) 7,120
Accounts payable (6,617) (2,916)
Accrued taxes (10,015) 17,420
Other (2,429) 17,002
------------------ ------------------
Net cash flows from operating activities 83,445 144,804
------------------ ------------------
- --------------------------------------------------------------------------------------------------------------
Cash flows used for financing activities:
Common stock dividends (30,990) (29,562)
Preferred stock dividends (1,656) (1,656)
Net change in short-term borrowings 14,500 (25,215)
Other (3,012) 785
------------------ ------------------
Net cash flows used for financing activities (21,158) (55,648)
------------------ ------------------
- --------------------------------------------------------------------------------------------------------------
Cash flows used for investing activities:
Utility construction expenditures (73,600) (69,031)
Nuclear decommissioning trust funds (1,438) (14,654)
Other 4,249 (5,481)
------------------ ------------------
Net cash flows used for investing activities (70,789) (89,166)
------------------ ------------------
- --------------------------------------------------------------------------------------------------------------
Net decrease in cash and temporary cash investments (8,502) (10)
------------------ ------------------
- --------------------------------------------------------------------------------------------------------------
Cash and temporary cash investments at beginning of period 8,577 307
------------------ ------------------
- --------------------------------------------------------------------------------------------------------------
Cash and temporary cash investments at end of period $75 $297
================== ==================
- --------------------------------------------------------------------------------------------------------------
Supplemental cash flows information:
Cash paid during the period for:
Interest $20,180 $19,668
================== ==================
Income taxes, net of refunds $24,267 $4,396
================== ==================
- --------------------------------------------------------------------------------------------------------------

The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.

26

WISCONSIN POWER AND LIGHT COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Except as modified below, the Alliant Energy Notes to Consolidated
Financial Statements are incorporated by reference insofar as they relate
to WP&L.

1. The interim consolidated financial statements included herein have been
prepared by WP&L, without audit, pursuant to the rules and regulations of
the SEC. Accordingly, certain information and footnote disclosures
normally included in financial statements prepared in accordance with GAAP
have been condensed or omitted, although management believes that the
disclosures are adequate to make the information presented not misleading.
The consolidated financial statements include WP&L and its consolidated
subsidiaries. WP&L is a direct subsidiary of Alliant Energy. These
financial statements should be read in conjunction with the financial
statements and the notes thereto included in WP&L's latest Annual Report on
Form 10-K.

In the opinion of management, all adjustments, which are normal and
recurring in nature, necessary for a fair presentation of (a) the
consolidated results of operations for the three and six months ended June
30, 2003 and 2002, (b) the consolidated financial position at June 30, 2003
and Dec. 31, 2002, and (c) the consolidated statement of cash flows for the
six months ended June, 2003 and 2002, have been made. Because of the
seasonal nature of WP&L's operations, results for the three and six months
ended June 30, 2003 are not necessarily indicative of results that may be
expected for the year ending Dec. 31, 2003. Certain prior period amounts
have been reclassified on a basis consistent with the current period
presentation.

2. WP&L's comprehensive income, and the components of other comprehensive
loss, net of taxes, for the three and six months ended June 30 were as
follows (in thousands):

Three Months Six Months
----------------------------- ----------------------------
2003 2002 2003 2002
------------- ------------- ------------- -------------

Earnings available for common stock $19,025 $11,961 $28,312 $26,878
Unrealized holding losses on qualifying
derivatives, net of tax -- (521) (5,914) (299)
Less: reclassification adjustment for gains
(losses) included in earnings available
for common stock, net of tax -- -- (5,597) 4,287
------------- ------------- ------------- -------------
Net unrealized losses on qualifying derivatives -- (521) (317) (4,586)
------------- ------------- ------------- -------------
Other comprehensive loss -- (521) (317) (4,586)
------------- ------------- ------------- -------------
Comprehensive income $19,025 $11,440 $27,995 $22,292
============= ============= ============= =============

27

3. Certain financial information relating to WP&L's significant business
segments is presented below. Gas revenues included $5 million for both the
three months ended June 30, 2003 and 2002, and $22 million and $8 million
for the six months ended June 30, 2003 and 2002, respectively, for sales to
the electric segment. All other intersegment revenues were not material to
WP&L's operations.

Electric Gas Other Total
--------------------------------------------------------
(in thousands)

Three Months Ended June 30, 2003
--------------------------------
Operating revenues $209,392 $35,727 $1,400 $246,519
Operating income (loss) 35,928 (3,604) 246 32,570
Earnings available for common stock 19,025

Three Months Ended June 30, 2002
--------------------------------
Operating revenues $186,384 $29,854 $1,228 $217,466
Operating income (loss) 28,444 (128) 274 28,590
Earnings available for common stock 11,961

Six Months Ended June 30, 2003
------------------------------
Operating revenues $422,088 $166,931 $2,777 $591,796
Operating income 34,652 16,007 424 51,083
Earnings available for common stock 28,312

Six Months Ended June 30, 2002
------------------------------
Operating revenues $358,143 $86,353 $2,518 $447,014
Operating income 46,953 5,120 660 52,733
Earnings available for common stock 26,878

10. WP&L utilizes several synthetic leases to finance certain utility
railcars and a utility radio dispatch system that were not included on
WP&L's Consolidated Balance Sheets. WP&L has guaranteed the residual value
of its synthetic leases totaling $14.3 million in the aggregate. The
guarantees extend through the maturity of each respective underlying lease,
the latest of which is April 2015.

14. Earnings (losses) on WP&L's nuclear decommissioning trust funds of $1.8
million and ($1.1) million for the three months ended June 30, 2003 and
2002, respectively, and $3.5 million and $5.3 million for the six months
ended June 30, 2003 and 2002, respectively, are included in "Interest
income" in WP&L's Consolidated Statements of Income. A corresponding
offset is recorded in "Depreciation and amortization" expense.

28

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS

The primary first tier subsidiaries of Alliant Energy include: IP&L, WP&L,
Resources and Corporate Services. Among various other regulatory
constraints, Alliant Energy is operating as a registered public utility
holding company subject to the limitations imposed by PUHCA. This MD&A
includes information relating to Alliant Energy, IP&L and WP&L (as well as
Resources and Corporate Services). Where appropriate, information relating
to a specific entity has been segregated and labeled as such. The following
discussion and analysis should be read in conjunction with the Consolidated
Financial Statements and Notes to Consolidated Financial Statements included
in this report as well as the financial statements, notes and MD&A included
in Alliant Energy's Current Report on Form 8-K, dated June 4, 2003, and
IP&L's and WP&L's latest Annual Report on Form 10-K.

FORWARD-LOOKING STATEMENTS

Statements contained in this report that are not of historical fact are
forward-looking statements intended to qualify for the safe harbors from
liability established by the Private Securities Litigation Reform Act of
1995. Such forward-looking statements are subject to risks and uncertainties
that could cause actual results to differ materially from those expressed in,
or implied by, such statements. Some, but not all, of the risks and
uncertainties include: weather effects on sales and revenues; economic and
political conditions in Alliant Energy's domestic and international service
territories; federal, state and international regulatory or governmental
actions, including the ability to obtain adequate and timely rate relief to
allow for, among other things, the recovery of operating costs and the
earning of reasonable rates of return, as well as the payment of expected
levels of dividends; Alliant Energy's ability to complete proposed asset
divestitures at expected values and on expected timelines; unanticipated
construction and acquisition expenditures; issues related to the supply of
purchased electricity and price thereof, including the ability to recover
purchased-power and fuel costs through rates; risks related to the operations
of Alliant Energy's nuclear facilities; costs associated with Alliant
Energy's environmental remediation efforts and with environmental compliance
generally; developments that adversely impact Alliant Energy's ability to
implement its strategic plan; improved results from Alliant Energy's Brazil
investments, the ability of Alliant Energy's Brazil investments to refinance
certain debt outstanding and no material adverse changes in the rates allowed
by the Brazilian regulators; improved performance by Alliant Energy's other
non-regulated businesses as a whole; no material permanent declines in the
fair market value of, or expected cash flows from, Alliant Energy's
investments; continued access to the capital markets; Alliant Energy's
ability to continue cost controls and operational efficiencies; Alliant
Energy's ability to identify and successfully complete proposed acquisitions
and development projects; access to technological developments; employee
workforce factors, including changes in key executives, collective bargaining
agreements or work stoppages; inflation rates; and factors listed in "Other
Matters - Other Future Considerations." Alliant Energy assumes no
obligation, and disclaims any duty, to update the forward-looking statements
in this report.

STRATEGIC ACTIONS

Alliant Energy continues to make significant progress relating to
implementing the plan it outlined in November 2002 to strengthen its
financial profile. An update on such progress follows.

o Asset sales and related debt reduction -
o In April 2003, Alliant Energy completed the sale of its Australian assets
to New Zealand-based Meridian. In July 2003, Alliant Energy completed the
sales of its affordable housing and SmartEnergy businesses.
o In July 2003, Whiting Petroleum Holdings, Inc. (a company formed to be a
holding company for Whiting) filed a registration statement with the SEC
relating to an IPO of its common stock. All of the shares of common
stock to be sold in the proposed IPO will be offered by Alliant Energy.
Alliant Energy currently intends to sell 51% or more of its interest in
Whiting later in 2003 in the proposed IPO and currently plans to divest
its remaining interest in Whiting by June 30, 2004, subject to market
conditions.
o If the proposed Whiting IPO is successfully executed, Alliant Energy would
no longer consolidate its investment in Whiting. Whiting had $185
million of debt outstanding as of June 30, 2003. As a result, Whiting's
debt would no longer be reported on Alliant Energy's balance sheet after
the proposed IPO. In addition, Alliant Energy expects to use proceeds
from the proposed IPO for debt reduction as well as some or all of the
proceeds received from the divestiture of the remainder of its Whiting

29

business. The amount of proceeds ultimately received from Alliant
Energy's divestiture of its Whiting business, and the timing of the
completion of the transactions, is subject to a variety of factors,
including the transaction structures used to exit this business.
o Alliant Energy is in the process of selling some or all of its utility
water business and has entered into an agreement in principle for the sale
of its water utility serving the Beloit area at a sale price of $21
million, subject to contingencies including regulatory approvals and
financing. Alliant Energy also continues the pursuit of the sale of its
water utilities serving the Ripon and South Beloit areas.
o As a result of the above completed and proposed asset sales, Alliant
Energy expects to achieve aggregate debt reductions in excess of $800
million with a significant majority, if not all, expected to occur in 2003
with any remainder in 2004. Debt reductions realized to-date as a result
of the asset sales are as follows (in millions):
o Australia $320
o Affordable housing and SmartEnergy 110 (in July/August 2003)
-----
o Total $430
=====
o Alliant Energy also expects to generate debt reductions of approximately
$40 million in the coming months as a result of incremental tax benefits
realized from the asset sales it has completed thus far.
o Alliant Energy also continues to divest other less material assets and
will continue reviewing other ways to narrow its strategic focus and
business platforms. The proceeds realized from such asset sales are also
expected to be available for debt reduction.
o Alliant Energy may be required to pay premiums in connection with a
portion of its debt reductions, which could result in charges to its
earnings from continuing operations.
o Common equity offering - in July 2003, Alliant Energy completed a public
offering of 17.25 million shares of its common stock at a price per share
to the public of $19.25. The net proceeds of approximately $318 million
were used to make capital contributions of $200 million and approximately
$118 million to WP&L and IP&L, respectively, in support of their respective
domestic utility generation and reliability initiatives. The WP&L
contribution satisfies an April 2003 PSCW order that required an equity
infusion of $200 million by Alliant Energy into WP&L by July 2003, thus no
customer refund is necessary. Consistent with the terms of the Alliant
Energy short-term credit facility, the amount of borrowing capability under
the facility was reduced by $18 million following the completion of the
common equity offering.
o Common stock dividend - Alliant Energy reduced its targeted annual common
stock dividend from $2.00 per share to $1.00 per share effective with the
dividend declared and paid in the first quarter of 2003.
o Anticipated construction and acquisition expenditures for 2002 and 2003 -
Alliant Energy reduced such aggregate expenditures by approximately $400
million from the plan that existed earlier in 2002.
o Cost control - Alliant Energy is implementing additional cost control
measures through its new Six Sigma program, its enterprise resource
planning system that was placed in service in October 2002 and by a
heightened focus on operating its domestic utility business in a manner
that aligns operating expenses with the revenues granted in various rate
filings.

As a result of the progress noted above and the fact that Alliant Energy's
cost control initiatives are expected to be an ongoing part of its business
and, hence, will never be fully completed, Alliant Energy has now
successfully executed all of its strategic actions announced in November 2002
other than the divestiture of its Whiting business.

RATES AND REGULATORY MATTERS

A summary of the regulatory environment is included in Alliant Energy's
Current Report on Form 8-K dated June 4, 2003, and the Form 10-K filed by
IP&L and WP&L for the year ended Dec. 31, 2002. Set forth below are several
recent developments relating to the regulatory environment.

30

Alliant Energy's merger-related price freezes expired in April 2002 in all of
its primary domestic utility jurisdictions and it has been addressing the
recovery of its utility cost increases through numerous rate filings.
Details of these rate cases are as follows (dollars in millions):

Expected Return
Interim Interim Final Final Final on
Utility Filing Increase Increase Effective Increase Effective Effective Common
Case Type Date Requested Granted (1) Date Granted (1) Date Date Equity Notes
- ------------------ -------- -------- ----------- ------------ ---------- ------------ ---------- ---------- ---------- -------

WP&L:
2002 retail E/G/W 8/01 $104 $49 4/02 $82 9/02 N/A 12.3%
2003 retail E/G/W 5/02 123 -- N/A 81 4/03 N/A 12% (2)
2004 retail E/G/W 3/03 87 TBD TBD TBD TBD 1/04 TBD
Wholesale E 2/02 6 6 4/02 3 1/03 N/A N/A
Wholesale E 3/03 5 5 7/03 TBD TBD 10/03 N/A (3)
IP&L retail - IA E 3/02 82 15 7/02 26 5/03 N/A 11.15%
IP&L retail - IA G 7/02 20 17 10/02 13 TBD 8/03 11.05% (4)
IP&L retail - MN E 5/03 5 2 7/03 TBD TBD 4/04 TBD
----------- ------------ ------------
Total $432 $94 $205
=========== ============ ============

(1) Interim rate relief is implemented, subject to refund, pending
determination of final rates. The final rate relief granted replaces the
amount of interim rate relief granted.
(2) A party to the case representing selected commercial and industrial
electric customers has filed an appeal to the judicial system to have the
decision in this case remanded back to the PSCW for further consideration
on issues of revenue increase amount and rate design. WP&L believes it is
unlikely that the final outcome of this appeal will result in any changes
to revenues or net income.
(3) WP&L has a rate change moratorium agreement with a wholesale customer
group that expired in July 2003. The requested rates went into effect in
July 2003, subject to refund. Settlement discussions are currently
underway.
(4) Since the final increase is lower than the interim relief granted in
October 2002, a refund plan was filed with the IUB in July 2003. IP&L is
reserving all amounts related to the anticipated refund.

A significant portion of the rate increases included in the previous table
reflect the recovery of increased costs incurred by IP&L and WP&L, or costs
they expect to incur, thus the increase in revenues related to these rate
increases are not expected to result in a corresponding increase in income.
IP&L announced in April 2003 that it will not file for an Iowa electric rate
increase in 2003, based on 2002 test year information, due to the fact that
the rate increase requested would have been modest and to ensure the case
that IP&L expects to file in 2004 would not be delayed awaiting a decision on
a case that would have been filed in 2003. The case IP&L expects to file in
2004 will include costs associated with the $400 million 500-MW combined
cycle natural gas plant currently under construction in Iowa. IP&L, WP&L and
South Beloit are currently in the process of determining what other rate case
filings may be made in 2003.

WP&L's retail electric rates are based on annual forecasted fuel and
purchased-power costs. In June 2003, WP&L received approval from the PSCW to
refund approximately $8 million to its retail electric customers due to
overcollection of past fuel and purchased-power costs. The refund was
completed in July 2003 and the impact of such refund had no material impact
on WP&L's results of operations given reserves for such refund that it had
previously recorded.

In 2002, IP&L filed with the IRS for a change in method of accounting for tax
purposes for 1987 through 2001 that would allow a current deduction related
to mixed service costs. Such costs had previously been capitalized and
depreciated for tax purposes over the appropriate tax lives. This change
would create a significant current tax benefit that has not been reflected in
IP&L's results of operations pending a decision from the IUB on the required
rate making treatment of the benefit. In its April 2003 order, the IUB
approved IP&L's proposed accounting treatment to defer the tax savings
resulting from the change of accounting method until the IRS audit on this
issue is complete. The rate making impact will be addressed once the issue
is resolved with the IRS, which is expected to occur in 2004. There would be
no material negative impact on IP&L's results of operations or financial
position should the IRS reject IP&L's proposal.

31

In June 2003, the IUB dismissed, without prejudice, IP&L's plan to contribute
and transfer transmission assets of 69 KV and greater to TRANSLink, a
for-profit, transmission-only company. However, the IUB encouraged the
participating companies to revise and refile their reorganization
applications. IP&L is currently evaluating its options with respect to
TRANSLink.

IP&L and WP&L are members of the Midwest ISO, which is in the process of
restructuring the bulk power market in its domain. Such restructuring could
have an impact on the costs associated with Alliant Energy serving its
utility customers' energy requirements. Given the anticipated regulatory
treatment of any potential cost differences, Alliant Energy does not
currently expect the ultimate outcome will have a material impact on its
results of operations or financial condition.

Legislation is currently pending in the U.S. Congress that would repeal
PUHCA. However, it is uncertain when or whether such legislation will be
enacted.

ALLIANT ENERGY RESULTS OF OPERATIONS

Unless otherwise noted, all "per share" references in the Results of
Operations section refer to earnings per diluted share.

Overview - Second Quarter Results - Alliant Energy's net income (loss) and
- ---------------------------------
EPS for the second quarter were as follows (dollars in millions; totals may
not foot due to rounding):

2003 2002
--------------------------- -----------------------------
Earnings (loss) from continuing operations: Net Income EPS Net Income EPS
--------------- ----------- --------------- --------------

Utility $22.6 $0.25 $26.9 $0.30
Non-regulated (Resources) (2.2) (0.02) (25.5) (0.28)
Alliant Energy parent and other (primarily taxes,
interest and administrative and general) (8.7) (0.10) (6.9) (0.08)
--------------- ----------- --------------- --------------
Total earnings (loss) from continuing operations 11.7 0.13 (5.5) (0.06)
Earnings from discontinued operations:
Operating results 5.8 0.06 6.0 0.07
Gain on sale of discontinued operations 40.7 0.44 -- --
Non-cash valuation and other accounting adjustments:
Southern Hydro SFAS 133 income (loss) (0.1) -- 5.8 0.06
Discontinuing depreciation, depletion and amortization
of assets held for sale 6.9 0.07 -- --
Valuation adjustments and selling costs (32.9) (0.35) -- --
--------------- ----------- --------------- --------------
Total earnings from discontinued operations 20.4 0.22 11.8 0.13
--------------- ----------- --------------- --------------
Net income $32.2 $0.35 $6.3 $0.07
=============== =========== =============== ==============

The lower utility earnings from continuing operations were largely due to
milder weather conditions in the second quarter of 2003 compared to the same
period in 2002. The positive impact on electric utility margin of several
rate increases implemented in the last twelve months was largely offset by
higher utility operating expenses and a higher utility effective income tax
rate. The significant improvement in non-regulated results from continuing
operations was primarily due to a $0.19 per share increase in the results
from Alliant Energy's International business unit and $0.11 per share of
asset valuation charges recorded in the second quarter of 2002. Alliant
Energy recorded an after-tax gain on the sale of its Australian business of
$41 million in the second quarter of 2003. In addition, the second quarter
of 2003 results reflect after-tax charges of $33 million for valuation
adjustments to reflect updated estimates of the market value of the $634
million of assets Alliant Energy classified as assets held for sale as of
June 30, 2003 as well as selling costs related to the asset divestitures.

32

Domestic Electric Utility Margins - Electric margins and MWh sales for
- ---------------------------------
Alliant Energy for the three months ended June 30 were as follows (in
thousands):

Revenues and Costs MWhs Sold
--------------------------------------- -----------------------------------
2003 2002 Change 2003 2002 Change
--------------------------------------- -----------------------------------

Residential $145,265 $135,032 8% 1,499 1,643 (9%)
Commercial 98,659 90,209 9% 1,335 1,339 --
Industrial 147,121 134,314 10% 3,096 3,153 (2%)
---------------------------- -------------------------
Total from ultimate customers 391,045 359,555 9% 5,930 6,135 (3%)
Sales for resale 40,581 38,970 4% 1,223 1,219 --
Other 12,482 14,125 (12%) 43 42 2%
---------------------------- -------------------------
Total revenues/sales 444,108 412,650 8% 7,196 7,396 (3%)
=========================
Electric production fuels expense 82,033 70,980 16%
Purchased-power expense 88,053 91,496 (4%)
----------------------------
Margin $274,022 $250,174 10%
============================

Electric margins and MWh sales for Alliant Energy for the six months ended
June 30 were as follows (in thousands):

Revenues and Costs MWhs Sold
---------------------------------------- -----------------------------------
2003 2002 Change 2003 2002 Change
---------------------------------------- -----------------------------------

Residential $311,413 $272,279 14% 3,569 3,516 2%
Commercial 190,788 168,001 14% 2,723 2,635 3%
Industrial 267,406 242,394 10% 5,990 5,999 --
----------------------------- ------------------------
Total from ultimate customers 769,607 682,674 13% 12,282 12,150 1%
Sales for resale 91,822 75,380 22% 2,555 2,422 5%
Other 25,704 25,358 1% 94 86 9%
----------------------------- ------------------------
Total revenues/sales 887,133 783,412 13% 14,931 14,658 2%
========================
Electric production fuels expense 147,893 129,741 14%
Purchased-power expense 218,432 163,833 33%
-----------------------------
Margin $520,808 $489,838 6%
=============================

Electric margin increased $23.8 million, or 10%, and $31.0 million, or 6%,
for the three- and six-month periods, respectively, primarily related to the
impact of various rate increases implemented in the second half of 2002 and
the first six months of 2003, including increased revenues to recover a
significant portion of increased operating expenses, and increased sales
resulting from continued modest retail customer growth. The three-month
increase was partially offset by milder weather conditions in the second
quarter of 2003 compared to the same period in 2002. The six-month increase
was partially offset by higher purchased-power and fuel costs at WP&L, which
are being recovered with new rates effective in April 2003. Under PSCW
rules, WP&L can seek emergency rate increases if its annual purchased-power
and fuel costs are more than 3% higher than the estimated costs used to
establish rates. In April 2003, WP&L implemented seasonal electric rates
that result in higher rates for the period from June 1 through September 30
and lower rates in all other periods. As a result, total annual revenues are
not expected to be impacted significantly, however, it is expected that going
forward, each year's second and third quarter revenues will be higher and
first and fourth quarter revenues will be lower. Such seasonal rates will
impact this year to last year quarterly revenues through the first quarter of
2004.
33

Gas Utility Margins - Gas margins and Dth sales for Alliant Energy for the
- -------------------
three months ended June 30 were as follows (in thousands):

Revenues and Costs Dths Sold
--------------------------------------- -----------------------------------
2003 2002 Change 2003 2002 Change
--------------------------------------- -----------------------------------

Residential $43,277 $34,991 24% 4,100 4,731 (13%)
Commercial 21,794 16,956 29% 2,650 2,903 (9%)
Industrial 5,422 4,076 33% 824 882 (7%)
Transportation/other 5,899 9,343 (37%) 9,880 10,339 (4%)
---------------------------- -------------------------
Total revenues/sales 76,392 65,366 17% 17,454 18,855 (7%)
=========================
Cost of utility gas sold 49,744 38,719 28%
----------------------------
Margin $26,648 $26,647 --
============================

Gas margins and Dth sales for Alliant Energy for the six months ended June 30
were as follows (in thousands):

Revenues and Costs Dths Sold
--------------------------------------- ------------------------------------
2003 2002 Change 2003 2002 Change
--------------------------------------- ------------------------------------

Residential $192,221 $111,577 72% 20,043 18,150 10%
Commercial 98,316 54,952 79% 11,915 10,733 11%
Industrial 17,494 10,117 73% 2,489 2,351 6%
Transportation/other 26,242 16,961 55% 24,612 23,153 6%
---------------------------- --------------------------
Total revenues/sales 334,273 193,607 73% 59,059 54,387 9%
==========================
Cost of utility gas sold 238,069 122,475 94%
----------------------------
Margin $96,204 $71,132 35%
============================

Gas revenues and cost of utility gas sold increased significantly for the
six-month period due to the large increase in natural gas prices from the
first half of 2002. Due to Alliant Energy's rate recovery mechanisms for gas
costs, these increases alone had little impact on gas margin. Gas margin
increased $25.1 million, or 35%, for the six-month period, primarily due to
various rate increases, increased sales, which were largely due to more
favorable weather conditions and continued modest retail customer growth, and
improved performance related to WP&L's performance-based commodity cost
recovery program (benefits are shared by ratepayers and shareowners).

Refer to "Rates and Regulatory Matters" for discussion of various electric
and gas rate filings.

Non-regulated and Other Revenues - Details regarding Alliant Energy's
- --------------------------------
non-regulated and other revenues for the three and six months ended June 30
were as follows (in thousands):

Three Months Six Months
------------------------------ -------------------------------
2003 2002 2003 2002
--------------- ------------- --------------- -------------

Integrated Services $79,169 $28,757 $226,922 $61,295
International 26,671 23,693 55,142 49,424
Investments 6,921 6,668 12,942 12,620
Other (includes eliminations) 13,031 7,326 25,670 15,538
--------------- ------------- --------------- -------------
$125,792 $66,444 $320,676 $138,877
=============== ============= =============== =============

The increased Integrated Services revenues for both periods were primarily
due to increased gas revenues at Alliant Energy's natural gas marketing
business, NG Energy, largely due to higher natural gas prices and volumes,
and increased revenues at Alliant Energy's environmental consulting
business. The increased Other revenues for both periods was primarily due to
Resources' purchase of a 309-MW natural-gas fired power plant in Wisconsin in
February 2003. Refer to Note 12 of Alliant Energy's "Notes to Consolidated
Financial Statements" for further discussion of NG Energy.

34

Other Operating Expenses - Other operation and maintenance expenses for the
- ------------------------
three and six months ended June 30 were as follows (in thousands):

Three Months Six Months
------------------------------ ------------------------------
2003 2002 2003 2002
-------------- ------------- ------------- -------------

Utility $158,570 $131,526 $310,139 $263,422
Integrated Services 78,269 26,561 217,464 54,515
International 19,407 20,073 39,169 40,418
Investments 4,464 3,794 8,201 7,508
Other (includes eliminations) 4,845 982 7,537 2,605
-------------- ------------- ------------- -------------
$265,555 $182,936 $582,510 $368,468
============== ============= ============= =============

The utility increase for both periods was primarily due to increases in the
amortization of deferred costs that are now being recovered in rates, the
impact of a planned refueling outage at Kewaunee in the second quarter of
2003 and higher uncollectible customer accounts, employee benefits and
insurance expenses. The three-month increase was partially offset by lower
fossil generation expenses, largely due to the timing of plant maintenance
activities. A significant portion of these cost increases are being
recovered as a result of the rate increases implemented in 2002 and 2003.
Refer to "Rates and Regulatory Matters" for additional information. The
Integrated Services and Other increases were largely driven by the same
factors impacting the revenue variances.

Depreciation and amortization expense increased $7.4 million and $11.5
million for the three- and six-month periods, respectively, primarily due to
acquisitions at the non-regulated businesses, higher contributions to IP&L's
nuclear decommissioning trust fund and utility property additions.

Taxes other than income taxes decreased $4.4 million and $6.1 million for the
three- and six-month periods, respectively, largely due to decreased property
taxes. Refer to "IP&L Results of Operations" for further discussion.

Interest Expense and Other - Interest expense increased $10.2 million and
- --------------------------
$21.2 million for the three- and six-month periods, respectively, primarily
due to higher average borrowing rates at Resources due to an increase in the
mix of long-term versus short-term debt outstanding and additional debt
outstanding at IP&L and the parent company.

Equity income (loss) from Alliant Energy's unconsolidated investments for the
three and six months ended June 30 was as follows (in thousands):

Three Months Six Months
---------------------------- -----------------------------
2003 2002 2003 2002
------------- ------------- -------------- -------------

ATC $3,962 $3,061 $7,856 $7,174
New Zealand 1,615 144 2,452 662
Brazil 6,825 (7,230) 2,239 (8,924)
China* 269 157 594 475
Synfuel (began operations 5/02) (5,181) (2,999) (10,075) (2,999)
Other 1,747 58 1,917 16
------------- ------------- -------------- -------------
$9,237 ($6,809) $4,983 ($3,596)
============= ============= ============== =============

* Majority of investments are accounted for under the consolidation method.

Equity income from unconsolidated investments increased $16.0 million and
$8.6 million for the three- and six-month periods, respectively. The
increased earnings for Brazil for both periods was primarily due to: foreign
currency transaction gains (losses) of $2.5 million and ($3.6) million
recorded in the second quarter of 2003 and 2002, respectively, related to $39
million in debt at one of the Brazilian operating companies; a 4.3% increase
in electricity sales in the second quarter of 2003, compared to the same
period in 2002; rate increases implemented at four of the Brazilian operating
companies in the first half of 2003; a second quarter 2002 charge of $3.1
million related to the recovery in Brazil of the impacts of rationing; and
other prior costs; these items were partially offset by higher interest
expense at the Brazilian companies. In the second quarter of 2002, Synfuel,
a direct subsidiary of Resources, purchased an equity interest in a synthetic
fuel processing facility which generates operating losses at its fuel
processing facility, which are more than offset by tax credits and the tax

35

benefit of the losses the project generates. All tax benefits are included
in "Income taxes" in Alliant Energy's Consolidated Statements of Income.
Refer to "Other Matters - Other Future Considerations" for further discussion
of the tax credits associated with the Synfuel investment.

AFUDC increased $2.9 million and $5.1 million for the three- and six-month
periods, respectively, primarily due to increased construction expenditures
at IP&L related to the $400 million generating facility it is constructing in
Iowa under its Power Iowa program.

Preferred dividend requirements of subsidiaries increased $2.3 million and
$4.8 million for the three- and six-month periods, respectively, due to an
increase in the principal amount of preferred stock outstanding at IP&L and a
higher dividend rate.

Refer to Note 7 of Alliant Energy's "Notes to Consolidated Financial
Statements" for discussion of the asset valuation charge recorded by Alliant
Energy in the first quarter of 2002 related to its McLeod available-for-sale
securities.

Miscellaneous, net income increased $14.7 million and $21.9 million for the
three- and six-month periods, respectively, primarily due to the recording of
pre-tax asset valuation charges in 2002 related to Alliant Energy's
investments in Enermetrix (Q1 $8.5 million); Energy Technologies (Q1 $5.0
million); and a loan receivable from a Mexican development company in
connection with development of a resort community in Mexico (Q2 $6.9
million). Also contributing to the increase for both periods were
improvements in the pre-tax, non-cash SFAS 133 valuation adjustments related
to the derivative component of Alliant Energy's exchangeable senior notes and
McLeod trading securities.

Income Taxes - The effective income tax rates were 28.4% and 29.4% for the
- ------------
three- and six-month periods ended June 30, 2003, respectively, while the
effective rates for the same periods in 2002 were not meaningful given the
insignificant amount of pre-tax loss from continuing operations in such
periods. The effective tax rate for both periods was lower than the
statutory federal income tax rate of 35% largely due to the impact of tax
credits, which were partially offset by property-related temporary
differences for which deferred taxes are not provided pursuant to rate making
principles, and the impact of state taxes.

Income from Discontinued Operations - Income from discontinued operations
- -----------------------------------
increased $8.6 million and decreased $18.1 million for the three- and
six-month periods, respectively. The three-month increase was discussed
earlier in "Overview - Second Quarter Results." The six-month decrease was
primarily due to the recording of after-tax valuation adjustments in 2003 of
$59 million to reflect updated estimates of the market value, less selling
costs, of Alliant Energy's assets classified as held for sale and lower
non-cash SFAS 133 income in 2003 related to the valuation of electricity
derivatives at Southern Hydro. These items were partially offset by the
after-tax gain on the sale of Alliant Energy's Australian business of $41
million recorded in the second quarter of 2003, impact of discontinuing
depreciation, depletion and amortization of Alliant Energy's assets held for
sale in 2003 and higher oil and gas prices at Whiting. Refer to Note 8 of
Alliant Energy's "Notes to Consolidated Financial Statements" for further
discussion of Alliant Energy's discontinued operations.

Cumulative Effect of Changes in Accounting Principles - In the first quarter
- -----------------------------------------------------
of 2003, Alliant Energy recorded after-tax charges of $4 million and $2
million for the cumulative effect of changes in accounting principles related
to the adoption on Jan. 1, 2003 of SFAS 143 and EITF Issue 02-3 within its
oil and gas and Integrated Services businesses, respectively. The oil and
gas business has been classified as held for sale. Refer to Notes 11 and 12
of Alliant Energy's "Notes to Consolidated Financial Statements" for further
information.

36

IP&L RESULTS OF OPERATIONS

Overview - Second Quarter Results - Earnings available for common stock
- ---------------------------------
decreased $10.2 million, primarily due to increased operating expenses,
preferred dividend requirements and a higher effective income tax rate.

Electric Utility Margins - Electric margins and MWh sales for IP&L for the
- ------------------------
three months ended June 30 were as follows (in thousands):

Revenues and Costs MWhs Sold
--------------------------------------- -----------------------------------
2003 2002 Change 2003 2002 Change
--------------------------------------- -----------------------------------

Residential $74,629 $76,432 (2%) 767 897 (14%)
Commercial 57,326 54,191 6% 819 810 1%
Industrial 86,819 80,467 8% 1,933 2,008 (4%)
----------------------------- ------------------------
Total from ultimate customers 218,774 211,090 4% 3,519 3,715 (5%)
Sales for resale 8,081 8,400 (4%) 288 350 (18%)
Other 7,861 6,776 16% 25 26 (4%)
----------------------------- ------------------------
Total revenues/sales 234,716 226,266 4% 3,832 4,091 (6%)
========================
Electric production fuels expense 47,931 39,194 22%
Purchased-power expense 37,438 37,062 1%
-----------------------------
Margin $149,347 $150,010 --
=============================

Electric margins and MWh sales for IP&L for the six months ended June 30 were
as follows (in thousands):

Revenues and Costs MWhs Sold
--------------------------------------- -----------------------------------
2003 2002 Change 2003 2002 Change
--------------------------------------- -----------------------------------

Residential $164,329 $152,397 8% 1,923 1,919 --
Commercial 111,595 100,272 11% 1,677 1,598 5%
Industrial 156,042 143,334 9% 3,779 3,842 (2%)
----------------------------- -------------------------
Total from ultimate customers 431,966 396,003 9% 7,379 7,359 --
Sales for resale 18,415 16,398 12% 591 658 (10%)
Other 14,664 12,868 14% 52 54 (4%)
----------------------------- -------------------------
Total revenues/sales 465,045 425,269 9% 8,022 8,071 (1%)
=========================
Electric production fuels expense 75,577 67,685 12%
Purchased-power expense 82,494 65,221 26%
-----------------------------
Margin $306,974 $292,363 5%
=============================

Electric margin decreased $0.7 million and increased $14.6 million, or 5%,
for the three- and six-month periods, respectively. The three-month decrease
was primarily due to lower sales volumes due to milder weather conditions in
the second quarter of 2003 compared to the same period in 2002 and lower
industrial sales. These items were largely offset by the impact of retail
rate increases implemented in 2002 and 2003, including increased revenues to
recover a significant portion of IP&L's increased operating expenses, lower
purchased-power capacity costs and increased sales resulting from continued
modest retail customer growth. The six-month increase was primarily due to
the impact of retail rate increases implemented in 2002 and 2003, increased
sales resulting from continued modest retail customer growth and
lower-purchased-power capacity costs.

37

Gas Utility Margins - Gas margins and Dth sales for IP&L for the three months
- -------------------
ended June 30 were as follows (in thousands):

Revenues and Costs Dths Sold
--------------------------------------- -----------------------------------
2003 2002 Change 2003 2002 Change
--------------------------------------- -----------------------------------

Residential $24,636 $20,517 20% 2,325 2,706 (14%)
Commercial 11,428 9,499 20% 1,380 1,553 (11%)
Industrial 4,144 3,116 33% 678 685 (1%)
Transportation/other 457 2,380 (81%) 6,546 6,347 3%
----------------------------- ------------------------
Total revenues/sales 40,665 35,512 15% 10,929 11,291 (3%)
========================
Cost of gas sold 27,222 22,210 23%
-----------------------------
Margin $13,443 $13,302 1%
=============================

Gas margins and Dth sales for IP&L for the six months ended June 30 were as
follows (in thousands):

Revenues and Costs Dths Sold
--------------------------------------- -----------------------------------
2003 2002 Change 2003 2002 Change
--------------------------------------- -----------------------------------

Residential $102,846 $64,377 60% 11,770 10,644 11%
Commercial 50,057 31,002 61% 6,644 6,049 10%
Industrial 11,199 6,583 70% 1,768 1,569 13%
Transportation/other 3,240 5,292 (39%) 14,889 14,273 4%
---------------------------- --------------------------
Total revenues/sales 167,342 107,254 56% 35,071 32,535 8%
==========================
Cost of gas sold 118,993 68,570 74%
----------------------------
Margin $48,349 $38,684 25%
============================

Gas revenues and cost of gas sold increased significantly for the six-month
period due to the large increase in natural gas prices from the first half of
2002. Such increases alone had no impact on IP&L's gas margin given its rate
recovery mechanism for gas costs. Gas margin increased $0.1 million, or 1%,
and $9.7 million, or 25%, for the three- and six-month periods, respectively,
primarily due to the impact of the retail rate increase effective in October
2002. The three-month increase was largely offset by the decreased sales.
Increased sales, primarily due to more favorable weather conditions in the
first quarter of 2003 compared to the same period in 2002, also contributed
to the six-month increase.

Refer to "Rates and Regulatory Matters" for discussion of IP&L's electric and
gas rate filings.

Other Operating Expenses - Other operation and maintenance expenses increased
- ------------------------
$4.9 million and $8.9 million for the three- and six-month periods,
respectively, primarily due to increased employee benefits, uncollectible
customer accounts and insurance expenses, partially offset by decreased
electric transmission and distribution expenses.

Depreciation and amortization expense increased $4.6 million and $8.9 million
for the three- and six-month periods, respectively, primarily due to
increased amortization of software, increased contributions to the nuclear
decommissioning trust fund and property additions.

Taxes other than income taxes decreased $3.7 million and $4.9 million for the
three- and six-month periods, respectively, largely due to decreased property
taxes, primarily related to an April 2003 property tax settlement.

38

IP&L appealed to the Iowa State Board of Tax Review, an agency of the State
of Iowa, regarding assessments of Iowa property tax made by the Director of
the Iowa Department of Revenue and Finance. The appeals involved assessments
for the years 1994 through 1998 and sought reduction of the assessments
reflecting the true value of IP&L's operating property. In April 2003, IP&L
settled this matter with the Iowa Department of Revenue and Finance. IP&L
expects to realize reductions in property tax expense of $7.7 million, $5.1
million, $3.6 million and $2.1 million in 2003, 2004, 2005, and 2006 and
thereafter, respectively, in comparison to what property tax expense would
have been without the settlement. The impact of the settlement on ratepayers
will be addressed in future ratemaking proceedings.

Interest Expense and Other - AFUDC increased $2.1 million and $3.6 million
- --------------------------
for the three- and six-month periods, respectively, due to increased
construction expenditures related to the $400 million generating facility
being constructed in Iowa under IP&L's Power Iowa program.

Miscellaneous, net income decreased $3.9 million and $3.5 million for the
three- and six-month periods, respectively, primarily due to lower income
from sales of non-commodity products and services.

Income Taxes - The effective income tax rates were 40.8% and 39.6% for the
- ------------
three- and six-month periods ended June 30, 2003, respectively, compared with
28.7% and 36.9% for the same periods last year. The increases were due to
increases in property-related temporary differences for which deferred taxes
were not provided pursuant to rate making principles, partially offset by the
impact of state taxes.

Preferred Dividend Requirements - Preferred dividend requirements increased
- -------------------------------
$2.3 million and $4.8 million for the three- and six-month periods,
respectively, due to an increase in the principal amount of preferred stock
outstanding and a higher dividend rate.

WP&L RESULTS OF OPERATIONS

Overview - Second Quarter Results - Earnings available for common stock
- ---------------------------------
increased $7.1 million, primarily due to higher electric margins, partially
offset by increased operating expenses.

Electric Utility Margins - Electric margins and MWh sales for WP&L for the
- ------------------------
three months ended June 30 were as follows (in thousands):

Revenues and Costs MWhs Sold
--------------------------------------- -----------------------------------
2003 2002 Change 2003 2002 Change
--------------------------------------- -----------------------------------

Residential $70,636 $58,600 21% 732 746 (2%)
Commercial 41,333 36,018 15% 516 530 (3%)
Industrial 60,302 53,847 12% 1,163 1,145 2%
---------------------------- -------------------------
Total from ultimate customers 172,271 148,465 16% 2,411 2,421 --
Sales for resale 32,500 30,570 6% 935 870 7%
Other 4,621 7,349 (37%) 18 15 20%
---------------------------- -------------------------
Total revenues/sales 209,392 186,384 12% 3,364 3,306 2%
=========================
Electric production fuels expense 34,102 31,787 7%
Purchased-power expense 50,615 54,435 (7%)
----------------------------
Margin $124,675 $100,162 24%
============================

39

Electric margins and MWh sales for WP&L for the six months ended June 30 were
as follows (in thousands):

Revenues and Costs MWhs Sold
--------------------------------------- -----------------------------------
2003 2002 Change 2003 2002 Change
--------------------------------------- -----------------------------------

Residential $147,084 $119,882 23% 1,646 1,597 3%
Commercial 79,193 67,729 17% 1,046 1,037 1%
Industrial 111,364 99,060 12% 2,211 2,157 3%
---------------------------- -------------------------
Total from ultimate customers 337,641 286,671 18% 4,903 4,791 2%
Sales for resale 73,407 58,982 24% 1,964 1,763 11%
Other 11,040 12,490 (12%) 42 32 31%
---------------------------- -------------------------
Total revenues/sales 422,088 358,143 18% 6,909 6,586 5%
=========================
Electric production fuels expense 72,316 62,056 17%
Purchased-power expense 135,938 98,612 38%
----------------------------
Margin $213,834 $197,475 8%
============================

Electric margin increased $24.5 million, or 24%, and $16.4 million, or 8%,
for the three- and six-month periods, respectively, primarily due to the
implementation of rate increases in 2002 and 2003, including increased
revenues to recover a significant portion of WP&L's increased operating
expenses, and increased sales resulting from continued modest retail customer
growth. The three-month increase was partially offset by milder weather
conditions in the second quarter of 2003 compared to the same period in
2002. The six-month increase was partially offset by higher purchased-power
and fuel costs which are being recovered with new rates effective in April
2003. Under PSCW rules, WP&L can seek emergency rate increases if its annual
purchased-power and fuel costs are more than 3% higher than the estimated
costs used to establish rates. WP&L continued to see improvements in the
economy as evidenced by the increased sales to industrial customers in both
periods. In April 2003, WP&L implemented seasonal electric rates that result
in higher rates for the period from June 1 through September 30 and lower
rates in all other periods. As a result, total annual revenues are not
expected to be impacted significantly, however, it is expected that going
forward, each year's second and third quarter revenues will be higher and
first and fourth quarter revenues will be lower. Such seasonal rates will
impact this year to last year quarterly revenues through the first quarter of
2004.

Gas Utility Margins - Gas margins and Dth sales for WP&L for the three months
- -------------------
ended June 30 were as follows (in thousands):

Revenues and Costs Dths Sold
--------------------------------------- -----------------------------------
2003 2002 Change 2003 2002 Change
--------------------------------------- -----------------------------------

Residential $18,641 $14,474 29% 1,775 2,025 (12%)
Commercial 10,366 7,457 39% 1,270 1,350 (6%)
Industrial 1,278 960 33% 146 197 (26%)
Transportation/other 5,442 6,963 (22%) 3,334 3,992 (16%)
--------------------------- ------------------------
Total revenues/sales 35,727 29,854 20% 6,525 7,564 (14%)
========================
Cost of gas sold 22,522 16,509 36%
---------------------------
Margin $13,205 $13,345 (1%)
===========================

40

Gas margins and Dth sales for WP&L for the six months ended June 30 were as
follows (in thousands):

Revenues and Costs Dths Sold
--------------------------------------- -----------------------------------
2003 2002 Change 2003 2002 Change
--------------------------------------- -----------------------------------

Residential $89,375 $47,200 89% 8,273 7,506 10%
Commercial 48,259 23,950 101% 5,271 4,684 13%
Industrial 6,295 3,534 78% 721 782 (8%)
Transportation/other 23,002 11,669 97% 9,723 8,880 9%
---------------------------- -------------------------
Total revenues/sales 166,931 86,353 93% 23,988 21,852 10%
=========================
Cost of gas sold 119,076 53,905 121%
----------------------------
Margin $47,855 $32,448 47%
============================

Gas revenues and cost of gas sold increased significantly for the six-month
period due to the large increase in natural gas prices from the first half of
2002. Due to WP&L's rate recovery mechanism for gas costs, these increases
alone had little impact on gas margin. Gas margin decreased $0.1 million, or
1%, and increased $15.4 million, or 47%, for the three- and six-month
periods, respectively. The three-month decrease was primarily due to
decreased sales, largely offset by the implementation of rate increases in
2002 and 2003. The six-month increase was primarily due to the implementation
of rate increases in 2002 and 2003, increased sales largely due to more
favorable weather conditions in the first quarter of 2003 compared to the
same period in 2002 and improved results from WP&L's performance-based
commodity cost recovery program (benefits are shared by ratepayers and
shareowners).

Refer to "Rates and Regulatory Matters" for discussion of WP&L's electric and
gas rate filings.

Other Operating Expenses - Other operation and maintenance expenses increased
- ------------------------
$20.3 million and $36.1 million for the three- and six-month periods,
respectively, primarily due to increases in the amortization of deferred
costs that are now being recovered in rates, the impact of a planned
refueling outage at Kewaunee in the second quarter of 2003, uncollectible
customer accounts, employee benefits and insurance expenses. The three-month
increase was partially offset by lower fossil generation expenses, largely
due to the timing of plant maintenance activities. A significant portion of
these cost increases are being recovered as a result of the rate increases
implemented in 2002 and 2003.

Depreciation and amortization expense increased $1.1 million and decreased
$1.2 million for the three- and six-month periods, respectively, primarily
due to changes in earnings on the nuclear decommissioning trust fund and
property additions. The accounting for earnings on the nuclear
decommissioning trust fund results in no net income impact. Interest income
increases for earnings on the trust fund and the corresponding offset is
recorded through depreciation expense.

Interest Expense and Other - Interest income increased $2.8 million and
- --------------------------
decreased $1.9 million largely due to changes in earnings on the nuclear
decommissioning trust fund.

Miscellaneous, net income increased $3.1 million and $1.3 million for the
three- and six-month periods, respectively, primarily due to higher income
from sales of non-commodity products and services.

Income Taxes - The effective income tax rates were 37.9% and 34.7% for the
- ------------
three- and six-month periods ended June 30, 2003, respectively, compared with
35.1% and 36.4%, respectively, for the same periods last year.

41

LIQUIDITY AND CAPITAL RESOURCES

Cash Flows for the Six-Month Periods - Selected information from Alliant
- ------------------------------------
Energy's, IP&L's and WP&L's Consolidated Statements of Cash Flows for the six
months ended June 30 was as follows (in thousands):

Alliant Energy IP&L WP&L
----------------------- ----------------------- -----------------------
Cash flows from (used for): 2003 2002 2003 2002 2003 2002
----------- ----------- ----------- ----------- ----------- -----------

Operating activities $220,720 $262,330 $197,467 $140,492 $83,445 $144,804
Financing activities 9,356 27,601 97,103 (24,721) (21,158) (55,648)
Investing activities (225,699) (307,024) (296,921) (115,777) (70,789) (89,166)

Alliant Energy's cash flows from operating activities decreased $42 million
primarily due to timing of Alliant Energy's refueling outages and changes in
working capital; cash flows from financing activities decreased $18 million
primarily due to net changes in the amount of debt issued and retired,
partially offset by lower common stock dividends due to the dividend
reduction implemented in the first quarter of 2003; cash flows used for
investing activities decreased $81 million primarily due to proceeds received
from the sale of Alliant Energy's Australian business in April 2003,
partially offset by the 2003 acquisition by Resources of a natural gas-fired
power plant in Wisconsin and increased construction and acquisition
expenditures associated with the construction of the natural gas plant in
Iowa as part of IP&L's Power Iowa program. IP&L's cash flows from operating
activities increased $57 million primarily due to changes in working capital
and the timing of a refueling outage at DAEC; cash flows from financing
activities increased $122 million primarily due to net changes in the amount
of short-term debt issued and retired; and cash flows used for investing
activities increased $181 million primarily due to increased construction and
acquisition expenditures associated with the construction of the Power Iowa
natural gas plant. WP&L's cash flows from operating activities decreased $61
million primarily due to changes in working capital and the timing of a
refueling outage at Kewaunee; and cash flows used for financing activities
decreased $34 million primarily due to net changes in the amount of
short-term debt issued and retired.

Common Equity - Refer to "Strategic Actions" for discussion of a common
- -------------
equity offering completed by Alliant Energy in July 2003.

Debt - Alliant Energy and its subsidiaries are party to various credit
- ----
facilities and other borrowing arrangements. The aggregate borrowing
capacity under short-term credit agreements of Alliant Energy and its
subsidiaries at June 30, 2003 was $826 million. At June 30, 2003, the unused
capacity under these facilities was $486 million. The credit agreements
relating to $800 million and $26 million of this borrowing capacity expire in
October 2003 and over the next nine months, respectively. While Alliant
Energy anticipates renewing these credit facilities prior to maturity, it
cannot provide any assurance it will be able to do so. In the second quarter
of 2003, Resources exercised its option to terminate its $250 million standby
credit facility. Alliant Energy's, IP&L's and WP&L's credit facility
agreements contain various covenants, including the following:

Covenant Description Covenant Requirement Status at June 30, 2003
- ------------------------------------------ ------------------------- -------------------------

Alliant Energy:
Consolidated debt-to-capital ratio * Less than 65% 58.7%
Consolidated net worth * At least $1.4 billion $1.9 billion
EBITDA interest coverage ratio * At least 2.5x 3.3x
IP&L debt-to-capital ratio Less than 58% 51.9%
WP&L debt-to-capital ratio Less than 58% 41.3%

* In compliance with the agreements, results of discontinued operations have
been included in the covenant calculations.

Alliant Energy is also subject to a PUHCA requirement whereby Alliant
Energy's common equity balance must be at least 30% of its total consolidated
capitalization, including short-term debt. Alliant Energy's common equity
ratio as of June 30, 2003, as computed under such requirement, was 37.1%.

42

Information regarding commercial paper at June 30, 2003 was as follows
(dollars in millions):

Alliant Energy (Parent) IP&L WP&L
------------------------ ------------------- ------------------

Commercial paper outstanding $86.0 $155.9 $74.5
Weighted average maturity
of commercial paper 1 day 8 days 18 days
Discount rates on commercial paper 1.75% 1.15-1.43% 1.18-1.26%

Alliant Energy had no borrowings outstanding under its bank facilities at
June 30, 2003.

Refer to "Strategic Actions" for information on debt reduction during 2003
related to recent steps Alliant Energy has taken to implement the plan it
outlined in November 2002 to strengthen its financial profile.

Off-Balance Sheet Arrangements - A summary of Alliant Energy's off-balance
- ------------------------------
sheet arrangements is included in Alliant Energy's Current Report on Form
8-K, dated June 4, 2003, and the Form 10-K filed by IP&L and WP&L for the
year ended Dec. 31, 2002 and have not changed materially from those reported
in such filings.

Environmental - A summary of Alliant Energy's environmental matters is
- -------------
included in Alliant Energy's Current Report on Form 8-K, dated June 4, 2003,
and the Form 10-K filed by IP&L and WP&L for the year ended Dec. 31, 2002 and
have not changed materially from those reported in such filings.

Construction and Acquisition Expenditures - In February 2003, Resources
- -----------------------------------------
announced the purchase of a 309-MW, non-regulated, natural gas-fired power
plant in Wisconsin for $109 million, which Resources financed with a $73
million 8-year secured credit facility ($58 million of borrowings were
outstanding at June 30, 2003), which is non-recourse to Alliant Energy. The
entire power output of the facility is sold under contract to Milwaukee-based
We Energies through June 2008.

OTHER MATTERS

Market Risk Sensitive Instruments and Positions - Alliant Energy's primary
- -----------------------------------------------
market risk exposures are associated with interest rates, commodity prices,
equity prices and currency exchange rates. Alliant Energy has risk
management policies to monitor and assist in controlling these market risks
and uses derivative instruments to manage some of the exposures. A summary
of Alliant Energy's market risks is included in Alliant Energy's Current
Report on Form 8-K, dated June 4, 2003, and IP&L's and WP&L's Form 10-K for
the year ended Dec. 31, 2002 and have not changed materially from those
reported in such filings, except as described below.

Currency Risk - Alliant Energy has investments in various countries where the
net investments are not hedged, including Brazil, China, New Zealand and
Canada. As a result, these investments are subject to currency exchange risk
with fluctuations in currency exchange rates. At June 30, 2003, Alliant
Energy had a cumulative foreign currency translation loss, net of any tax
benefits realized, of $95 million, which related to decreases in value of the
Brazil real of $94 million and New Zealand dollar of $1 million, all in
relation to the U.S. dollar. This loss is recorded in "Accumulated other
comprehensive loss" on Alliant Energy's Consolidated Balance Sheets. Based
on Alliant Energy's investments at June 30, 2003, a 10% sustained
increase/decrease over the next 12 months in the foreign exchange rates of
Brazil, China, New Zealand and Canada would result in a corresponding
increase/decrease in the cumulative foreign currency translation loss of $54
million. Alliant Energy's equity income (loss) from its foreign investments
is also impacted by fluctuations in currency exchange rates.

Alliant Energy also has currency exchange risk associated with approximately
$39 million of debt outstanding at one of the Brazilian operating companies.
For the three and six months ended June 30, 2003, Alliant Energy recorded
equity income of $2.5 million and $3.0 million, respectively, and for the
same periods in 2002, Alliant Energy recorded equity losses of $3.6 million
and $2.8 million, respectively, related to its share of the foreign currency
transaction gains/losses on such debt. Based on the loan balance and
currency rates at June 30, 2003, a 10% change in the currency rates would
result in a $2.9 million pre-tax increase/decrease in net income.

43

In addition, Alliant Energy has currency exchange risk associated with
approximately $18 million of payables at one of its Canadian operating
companies. For the three months ended June 30, 2003, Alliant Energy recorded
pre-tax income of $2.1 million related to the foreign currency transaction
gains/losses on such payable. Based on the payables balance and currency
rates at June 30, 2003, a 10% change in the currency rates would result in a
$1.8 million pre-tax increase/decrease in net income.

Accounting Pronouncements - In April 2003, the FASB issued SFAS 149,
- -------------------------
"Amendment of SFAS 133 on Derivative Instruments and Hedging Activities,"
which amends and clarifies accounting for derivative instruments, including
certain derivative instruments embedded in other contracts, and for hedging
activities under SFAS 133. The amendments set forth in SFAS 149 improve
financial reporting by requiring that contracts with comparable
characteristics be accounted for similarly. SFAS 149 clarifies under what
circumstances a contract with an initial net investment meets the
characteristic of a derivative as discussed in SFAS 133 and when a derivative
contains a financing component that warrants special reporting in the
statement of cash flows, as well as amending certain other existing
pronouncements. Those changes will result in more consistent reporting of
contracts that are derivatives in their entirety or that contain embedded
derivatives that warrant separate accounting. SFAS 149 is effective for
contracts entered into or modified after June 30, 2003, except for certain
implementation issues and certain provisions of forward purchase and sale
contracts and for hedging relationships designated after June 30, 2003.
Alliant Energy continues to evaluate the potential impacts of SFAS 149 on new
contracts entered into after June 30, 2003.

In May 2003, the FASB issued SFAS 150, "Accounting for Certain Financial
Instruments with Characteristics of Both Liabilities and Equity," which
requires an issuer to classify outstanding free-standing financial
instruments within its scope as a liability on its balance sheets even though
the instruments have characteristics of equity. Alliant Energy adopted SFAS
150 on July 1, 2003 with no material impact on Alliant Energy's financial
condition or results of operations.

Critical Accounting Policies - A summary of Alliant Energy's critical
- ----------------------------
accounting policies is included in Alliant Energy's Current Report on Form
8-K, dated June 4, 2003, and IP&L's and WP&L's Form 10-K for the year ended
Dec. 31, 2002 and have not changed materially from those reported in such
filings.

Other Future Considerations - In addition to items discussed earlier in MD&A,
- ---------------------------
the following items could impact Alliant Energy's future financial condition
or results of operations:

Alliant Energy holds unconsolidated investments in certain Brazilian electric
utility companies. The Brazilian utilities are negotiating with creditors to
restructure and convert approximately $180 million, as converted from local
currency to U.S. dollars, of short-term and long-term debt currently
outstanding into new long-term debentures and other longer-term debt. In the
second quarter of 2003, Standard and Poor's issued a formal rating on the
debentures of 'brBBB+' with a negative outlook. The proposed refinancing has
been approved by the shareowners of the Brazilian utilities. The refinancing
is also subject to other approvals in the ordinary course and final closing
that are currently expected to be complete in the third quarter of 2003. If
the refinancing is not completed as anticipated and the Brazilian utilities
are unable to extend or repay certain obligations outstanding, then the
liquidity position of the Brazilian utilities may be significantly adversely
affected. In such an event, Alliant Energy is not required to invest any
additional capital in Brazil but it could lead to material asset valuation
charges as relates to Alliant Energy's investments in its Brazilian utilities.

In June 2003, the IRS announced it is reviewing the scientific validity of
test procedures and results used by companies claiming tax credits for
producing synthetic fuels from coal and may withdraw such credits for
operations that fail to meet federal standards which require, among other
things, a significant chemical change to occur in the process. Since the
second quarter of 2002, Alliant Energy has been an investor in a synthetic
fuel facility and continued to record these tax credits as of June 30, 2003.
Alliant Energy currently estimates its tax credits for producing synthetic
fuels to be approximately $23 million and $15 million for 2003 and 2002,
respectively. The synthetic fuel facility Alliant Energy partially owns
previously received a private letter ruling from the IRS, which states that
based on the facts submitted, a significant chemical change was achieved in
its process. Alliant Energy cannot predict the outcome of the latest reviews
by the IRS.

44

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Quantitative and Qualitative Disclosures About Market Risk are reported under
Item 2 MD&A "Other Matters - Market Risk Sensitive Instruments and
Positions."

ITEM 4. CONTROLS AND PROCEDURES

Alliant Energy's, IP&L's and WP&L's management evaluated, with the
participation of each of Alliant Energy's, IP&L's and WP&L's Chief Executive
Officer, Chief Financial Officer and Disclosure Committee, the effectiveness
of the design and operation of Alliant Energy's, IP&L's and WP&L's disclosure
controls and procedures as of the end of the quarter ended June 30, 2003
pursuant to the requirements of the Securities Exchange Act of 1934, as
amended. Based on those evaluations, the Chief Executive Officer and the
Chief Financial Officer concluded that Alliant Energy's, IP&L's and WP&L's
disclosure controls and procedures were effective as of the end of the
quarter ended June 30, 2003.

There was no change in Alliant Energy's, IP&L's and WP&L's internal control
over financial reporting that occurred during the quarter ended June 30, 2003
that has materially affected, or is reasonably likely to materially affect,
Alliant Energy's, IP&L's or WP&L's internal control over financial
reporting.

PART II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

Alliant Energy
On April 17, 2003, a purported class action shareowner lawsuit was filed
against Alliant Energy, Erroll B. Davis, Jr., Thomas M. Walker and John E.
Kratchmer in the U.S. District Court for the Western District of Wisconsin as
Case No. 03-C-0191. Several substantially similar cases were subsequently
filed in the same court and were consolidated into one action. The actions
were allegedly brought on behalf of purchasers of Alliant Energy securities
from Jan. 29, 2002 through July 18, 2002. The amended consolidated complaint
alleged that the defendants made false and misleading statements in relation
to Alliant Energy's expected performance of its various non-regulated
businesses. On Aug. 13, 2003, the court, acting upon a motion filed by the
defendants, dismissed the action without prejudice.

In October 2000, Alliant Energy and WP&L filed a federal lawsuit seeking
declaratory relief regarding whether certain provisions of WUHCA are
unconstitutional as a violation of the interstate commerce and equal
protection provisions of the U.S. Constitution. Alliant Energy and WP&L are
challenging the provisions of WUHCA which restrict ownership in utility
holding companies, limit the investments those companies can make and place
significant restrictions on companies that invest in Wisconsin utility
holding companies. Alliant Energy and WP&L also requested that the court
consider the constitutionality of issues related to the asset cap on
non-utility investments imposed by WUHCA. The district court ultimately
dismissed the case on summary judgment grounds in May 2002. Alliant Energy
and WP&L appealed the district court's decision to the 7th Circuit Court of
Appeals in June 2002. In May 2003, the 7th Circuit ruled that it is
unconstitutional to require public utility holding companies with Wisconsin
utility subsidiaries to be incorporated in the state of Wisconsin. The
remaining WUHCA provisions that Alliant Energy challenged were upheld as
constitutional. Alliant Energy filed a petition for rehearing with the 7th
Circuit regarding those provisions that were upheld, which was denied in July
2003. Alliant Energy is considering petitioning the U.S. Supreme Court to
review the case.

45

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

ALLIANT ENERGY
At Alliant Energy's annual meeting of shareowners held on May 28, 2003,
Erroll B. Davis, Jr., Robert W. Schlutz, and Wayne H. Stoppelmoor were
elected as directors of Alliant Energy for terms expiring in 2006. The
following sets forth certain information with respect to the election of
these directors at the annual meeting.

Name of Nominee Votes For Votes Withheld
- --------------- --------- --------------
Erroll B. Davis, Jr. 69,786,469 5,924,198
Robert W. Schlutz 71,012,428 4,698,239
Wayne H. Stoppelmoor 70,911,446 4,799,221

The following are the other directors of Alliant Energy whose terms of office
continued after the 2003 annual meeting: Jack B. Evans, David A. Perdue, and
Judith D. Pyle, with terms expiring in 2004; and Alan B. Arends, Katharine C.
Lyall, Singleton B. McAllister, and Anthony R. Weiler, with terms expiring in
2005. Effective as of the date of the annual meeting, Lee Liu and Joyce L.
Hanes both retired.

IP&L
At IP&L's annual meeting of shareowners held on May 6, 2003, Erroll B. Davis,
Jr., Robert W. Schlutz, and Wayne H. Stoppelmoor were elected as directors of
IP&L for terms expiring in 2006. Alliant Energy voted all of the outstanding
shares of common stock of IP&L (consisting of 13,370,788 shares) in favor of
the election of these individuals. The following are the other directors of
IP&L whose terms of office continued after the 2003 annual meeting: Jack B.
Evans, David A. Perdue, and Judith D. Pyle, with terms expiring in 2004; and
Alan B. Arends, Katharine C. Lyall, Singleton B. McAllister, and Anthony R.
Weiler, with terms expiring in 2005. Effective as of the date of the annual
meeting, Lee Liu and Joyce L. Hanes both retired.

WP&L
At WP&L's annual meeting of shareowners held on June 5, 2003, Erroll B.
Davis, Jr., Robert W. Schlutz, and Wayne H. Stoppelmoor were elected as
directors of WP&L for terms expiring in 2006. The following sets forth
certain information with respect to the election of these directors at the
annual meeting.

Name of Nominee Votes For Votes Withheld
- --------------- --------- --------------
Erroll B. Davis, Jr. 13,654,011 6,316
Robert W. Schlutz 13,655,673 4,654
Wayne H. Stoppelmoor 13,655,381 4,946

The following are the other directors of WP&L whose terms of office continued
after the 2003 annual meeting: Jack B. Evans, David A. Perdue, and Judith D.
Pyle, with terms expiring in 2004; and Alan B. Arends, Katharine C. Lyall,
Singleton B. McAllister, and Anthony R. Weiler, with terms expiring in 2005.
Effective as of the date of the annual meeting, Lee Liu and Joyce L. Hanes
both retired.

46

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

(a) Exhibits: The following Exhibits are filed herewith or incorporated by
--------
reference.

10.1 Amendment No. 1 to Credit Agreement, dated as of Dec. 5, 2002, among
Alliant Energy, the Lenders party thereto and Bank One, NA, as agent

10.2 Amendment No. 2 to Credit Agreement, dated as of June 27, 2003,
among Alliant Energy, the Lenders party thereto and Bank One, NA, as
agent

10.3 Second Amendment to Credit Agreement, dated as of June 30, 2003, by
and among Whiting, Bank One, NA, as Administrative Agent and each of
the Financial Institutions a party thereto (incorporated by
reference to Exhibit 4.4 of Whiting Petroleum Holdings, Inc.'s
Registration Statement on Form S-1 (Registration No. 333-107341))

31.1 Certification of the Chairman, President and Chief Executive Officer
(CEO) for Alliant Energy

31.2 Certification of the Executive Vice President and Chief Financial
Officer (CFO) for Alliant Energy

31.3 Certification of the Chairman and CEO for IP&L

31.4 Certification of the Executive Vice President and CFO for IP&L

31.5 Certification of the Chairman and CEO for WP&L

31.6 Certification of the Executive Vice President and CFO for WP&L

32.1 Written Statement of the CEO and CFO Pursuant to 18 U.S.C. Section
1350 for Alliant Energy

32.2 Written Statement of the CEO and CFO Pursuant to 18 U.S.C. Section
1350 for IP&L

32.3 Written Statement of the CEO and CFO Pursuant to 18 U.S.C. Section
1350 for WP&L

(b) Reports on Form 8-K:
--------------------

Alliant Energy
Alliant Energy filed a Current Report on Form 8-K, dated June 26, 2003,
reporting (under Item 9) information with respect to its strategic actions,
certain other recent developments and 2003 earnings guidance.

Alliant Energy filed a Current Report on Form 8-K, dated June 4, 2003,
reporting (under Items 5 and 7) information identical to the corresponding
sections of Alliant Energy's Form 10-K Annual Report for the year ended
Dec. 31, 2002, except that all such information has been updated to the
extent required to report energy trading contracts on a net rather than
gross basis in the income statement for all periods presented as a result
of adopting EITF Issue 02-3 and the impact of separately classifying and
reporting SmartEnergy as a discontinued operation and asset held for sale
based on Alliant Energy's January 2003 decision to sell SmartEnergy.

Alliant Energy filed a Current Report on Form 8-K, dated April 28, 2003,
reporting (under Items 7 and 9 (information provided under Item 12)) that
it issued a press release announcing its earnings for the quarter ended
March 31, 2003 and its earnings guidance for 2003, and a copy of the script
of the April 28, 2003 conference call to discuss those items.

IP&L - None.

WP&L - None.

47

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, Alliant
Energy Corporation, Interstate Power and Light Company and Wisconsin Power
and Light Company have each duly caused this report to be signed on its
behalf by the undersigned thereunto duly authorized on the 14th day of August
2003.

ALLIANT ENERGY CORPORATION
- --------------------------
Registrant

By: /s/ John E. Kratchmer Vice President-Controller and Chief Accounting Officer
- -------------------------
John E. Kratchmer (Principal Accounting Officer and Authorized Signatory)

INTERSTATE POWER AND LIGHT COMPANY
- ----------------------------------
Registrant

By: /s/ John E. Kratchmer Vice President-Controller and Chief Accounting Officer
- -------------------------
John E. Kratchmer (Principal Accounting Officer and Authorized Signatory)

WISCONSIN POWER AND LIGHT COMPANY
- ---------------------------------
Registrant

By: /s/ John E. Kratchmer Vice President-Controller and Chief Accounting Officer
- -------------------------
John E. Kratchmer (Principal Accounting Officer and Authorized Signatory)

48