Other contractual obligations, which are not reflected in the above table, did not materially change from those disclosed in the 2012 Annual MD&A, except as described as follows.
In March 2013 FortisBC Electric acquired the City of Kelowna's electrical utility assets for approximately $55 million. For further information, refer to the "Significant Items" section of this MD&A.
For a discussion of the nature and amount of the Corporation's consolidated capital expenditure program, which is not included in the preceding Contractual Obligations table, refer to the "Capital Expenditure Program" section of this MD&A.
CAPITAL STRUCTURE
The Corporation's principal businesses of regulated gas and electricity distribution require ongoing access to capital to enable the utilities to fund maintenance and expansion of infrastructure. Fortis raises debt at the subsidiary level to ensure regulatory transparency, tax efficiency and financing flexibility. Fortis generally finances a significant portion of acquisitions at the corporate level with proceeds from common share, preference share and long-term debt offerings. To help ensure access to capital, the Corporation targets a consolidated long-term capital structure containing approximately 40% equity, including preference shares, and 60% debt, as well as investment-grade credit ratings. Each of the Corporation's regulated utilities maintains its own capital structure in line with the deemed capital structure reflected in each of the utility's customer rates.
The consolidated capital structure of Fortis is presented in the following table.
----------------------------------------------------------------------------Capital Structure (Unaudited) As at March 31, 2013 December 31, 2012 ($ millions) (%) ($ millions) (%)--------------------------------------------------------------------------------------------------------------------------------------------------------Total debt and capital lease and finance obligations (net of cash) (1) 6,376 55.0 6,317 55.3Preference shares 1,108 9.5 1,108 9.7Common shareholders' equity 4,114 35.5 3,992 35.0----------------------------------------------------------------------------Total (2) 11,598 100.0 11,417 100.0--------------------------------------------------------------------------------------------------------------------------------------------------------(1) Includes long-term debt and capital lease and finance obligations, including current portion, and short-term borrowings, net of cash(2) Excludes amounts related to non-controlling interests
The change in the capital structure was primarily due to: (i) net earnings attributable to common equity shareholders, net of dividends declared; (ii) common shares issued, mainly under the Corporation's dividend reinvestment, stock option and employee share purchase plans; and (iii) lower short-term borrowings. The capital structure was also impacted by an increase in long-term debt, mainly due to higher borrowings under committed credit facilities, largely in support of energy infrastructure investment, partially offset by regularly scheduled debt repayments.
Excluding capital lease and finance obligations, the Corporation's capital structure as at March 31, 2013 was 53.2% debt, 9.9% preference shares and 36.9% common shareholders' equity (December 31, 2012 - 53.6% debt, 10.1% preference shares and 36.3% common shareholders' equity).
