news release > entergy reports fourth quarter earnings

for immediate release

entergy reports fourth quarter earnings

02/08/2011

new orleans – 沙特vs墨西哥让球 (nyse: etr) today reported fourth quarter 2010 as-reported earnings of $228.3 million, or $1.26 per share, compared with $313.8 million, or $1.64 per share, for fourth quarter 2009. on an operational basis, entergy's fourth quarter 2010 earnings were $235.0 million, or $1.30 per share, compared with $334.9 million, or $1.75 per share, in fourth quarter 2009. for the year, entergy's as-reported earnings were $1.3 billion, or $6.66 per share, and operational earnings were $1.3 billion, or $7.10 per share. these results compare with 2009 as-reported earnings of $1.2 billion, or $6.30 per share, and operational earnings of $1.3 billion, or $6.67 per share.

beginning this quarter, entergy has revised its business segment disclosures to reflect the internal reorganization announced in june 2010 combining all non-utility generation into entergy wholesale commodities, or ewc. a portion of ewc was previously reported in parent & other. the utility segment is unchanged.

consolidated earnings -- reconciliation of gaap to non-gaap measures

fourth quarter and year-to-date 2010 vs. 2009

(per share in u.s. $)

           
 

fourth quarter

year-to-date

 

2010

2009

change

2010

2009

change

as-reported earnings

1.26

1.64

(0.38)

6.66

6.30

0.36

less special items

(0.04)

(0.11)

0.07

(0.44)

(0.37)

(0.07)

operational earnings

1.30

1.75

(0.45)

7.10

6.67

0.43

*gaap refers to united states generally accepted accounting principles.

operational earnings highlights for fourth quarter 2010

  • utility results were lower due to an increase in non-fuel operation and maintenance expense.
  • entergy wholesale commodities earnings decreased as a result of lower net revenue and a higher effective income tax rate, partially offset by a gain on the sale of an investment.
  • parent & other results declined due to several individually insignificant items, including higher interest expense.

"once again our businesses delivered strong operational performance and for the sixth year in a row we achieved record operational earnings per share," said j. wayne leonard, entergy's chairman and chief executive officer. "our efforts in 2010 have positioned us for future success. the utility's regulatory progress, including rate case settlements in arkansas and texas, and future opportunities for productive investments provide one of the best growth stories in the industry. the execution of the reorganization to establish entergy wholesale commodities further enhances our focus on license renewal efforts. and as ewc faces challenging power markets, we are largely hedged in the upcoming years to provide certainty in a bearish environment."

other business highlights

  • the staff of the nuclear regulatory commission issued its final supplemental environmental impact statement for indian point's proposed 20-year license renewal, concluding that there are no environmental impacts that would preclude license renewal for an additional 20 years of operation.
  • the public utility commission of texas unanimously approved the entergy texas rate case settlement.
  • in january, entergy louisiana received the remaining regulatory approval from the louisiana public service commission for its proposed acquisition of the acadia unit 2 power plant paving the way for a first quarter 2011 closing.

entergy will host a teleconference to discuss this release at 10 a.m. ct on tuesday, feb. 8, 2011, with access by telephone, 719-457-2080, confirmation code 2202485. the call and presentation slides can also be accessed via entergy's website at www.entergy.com. a replay of the teleconference will be available through feb. 15, 2011, by dialing 719-457-0820, confirmation code 2202485. the replay will also be available on entergy's website at www.entergy.com.

utility

in fourth quarter 2010, utility's as-reported and operational earnings were $114.3 million, or 63 cents per share, compared to $137.9 million, or 72 cents per share, in fourth quarter 2009. utility fourth quarter 2010 earnings decline is due primarily to higher fossil outage spending, the timing of reliability-related spending, and higher compensation and benefit costs. providing a partial offset is the net effect of higher other income and utility net revenue. after excluding the effect of a regulatory item that was offset in other income, and the absence of 2009 adjustments, net revenue increased during the quarter. this revenue improvement resulted from higher sales, including favorable weather, and pricing adjustments from previous regulatory actions.

residential sales in fourth quarter 2010, on a weather-adjusted basis, increased 0.6 percent compared to fourth quarter 2009. commercial and governmental sales, on a weather-adjusted basis, increased 1.5 percent quarter over quarter. industrial sales in the fourth quarter increased 7.0 percent compared to the same quarter of 2009.

the quarter-to-quarter increase in weather-adjusted sales in the residential sector reflected growth in arkansas, louisiana and new orleans, as well as commercial sales growth in all jurisdictions. growth in industrial sales reflected industrial expansion, as well as increasing economic activity (although at a slower pace than earlier in 2010 as the recovery matures) across small, mid-sized and large customers. chemicals, refining and miscellaneous manufacturing sectors led the improvement among the large industrial customer segment, partially offset by a decline in pulp and paper.

for the year 2010, the utility earned $812.4 million, or $4.33 per share, on as-reported and operational bases, compared to $691.6 million, or $3.53 per share, in 2009. the increase in 2010 was driven by higher utility net revenue due primarily to increased sales volumes across all customer classes, including the significant effect from favorable weather throughout the year and the net effect of pricing adjustments from previous rate actions. also contributing to the utility earnings increase in 2010 was lower depreciation and amortization expense and accretion from entergy's share repurchase programs. partially offsetting these items were higher non-fuel operation and maintenance expense driven by fossil outage spending, reliability-related spending, and compensation and benefits costs; higher interest expense; and increased taxes other than income taxes.

entergy wholesale commodities

entergy wholesale commodities earned $149.9 million, or 83 cents per share, on an as-reported basis in fourth quarter 2010, compared to as-reported earnings of $197.9 million, or $1.04 per share in fourth quarter 2009. on an operational basis, fourth quarter 2010 entergy wholesale commodities' earnings were $156.7 million, or 87 cents per share, versus $209.9 million, or $1.10 per share, in the last quarter of the prior year. earnings decreased at entergy wholesale commodities as a result of lower net revenue due primarily to additional planned and unplanned outage days at ewc's nuclear plants. net revenue also reflected lower pricing for the ewc portfolio of both nuclear and non-nuclear wholesale assets. in addition, a reduction in other income associated with decommissioning trusts and a higher effective income tax rate contributed to the overall quarter-over-quarter decline. partially offsetting these items in operational results was a gain on sale of the harrison county power plant and lower non-fuel operation and maintenance expense.

for the year 2010, entergy wholesale commodities earned $486.7 million, or $2.59 per share, on an as-reported basis and $587.4 million, or $3.13 per share, on an operational basis. this compares to as-reported earnings of $638.5 million, or $3.26 per share, and operational earnings of $682.5 million, or $3.49 per share, in 2009. the decrease in entergy wholesale commodities earnings in the current year was driven by lower net revenue due to lower pricing and lower generation resulting from increased planned and unplanned outage days at ewc's nuclear plants. higher non-fuel operation and maintenance expense also contributed to the lower results, with a write-off of capitalized engineering costs associated with a potential uprate project, costs for tritium remediation work at the vermont yankee site, and increased compensation and benefits costs being the primary factors. in addition, the 2010 effective income tax rate was higher than 2009. partially offsetting these items was the gain on sale noted above, lower interest expense and accretion from entergy's share repurchase programs. in addition, the absence of significant impairments on ewc's decommissioning trust funds recorded in 2009 were partially offset by lower realized earnings on decommissioning trust investments, also reflected in other income.

parent & other

parent & other reported a loss of $35.9 million, or 20 cents per share, on an as-reported basis in fourth quarter 2010 compared to a loss of $22.1 million, or 12 cents per share in fourth quarter 2009. on an operational basis, parent & other reported a loss of $35.9 million, or 20 cents per share, in fourth quarter 2010 compared to a loss of $12.9 million, or seven cents per share, in fourth quarter 2009. parent & other's operational results declined during the quarter due to several individually insignificant items including higher interest expense on parent debt.

for the year 2010, parent & other reported a loss of $48.8 million, or 26 cents per share, on an as-reported basis compared to a loss of $98.9 million, or 49 cents per share, in the prior year. on an operational basis, parent & other recorded a loss of $67.3 million, or 36 cents per share, in 2010, compared to a loss of $72.0 million, or 35 cents per share, in 2009. lower income taxes in operational results were offset by a reduction in other income associated with the elimination of higher affiliate dividend income at the utility.

outlook

entergy affirmed its 2011 earnings guidance in the range of $6.35 to $6.85 per share on both as-reported and operational bases.

long-term financial outlook

entergy believes it offers a long-term, competitive utility investment opportunity combined with a valuable option represented by a unique, clean, non-utility generation business located in attractive power markets. the current long-term financial outlook (prepared october 2010) includes the following:  

earnings:

  • utility net income:  6 to 8 percent compound annual net income growth rate over the 2010 – 2014 horizon (2009 base year).
  • entergy wholesale commodities results:  revenue projections through 2014 will experience increased volatility due to commodity market activities – one of the most important fundamental drivers for this business. while current sold and forward power prices would indicate a decline in the long-term financial outlook for this business compared to 2010, entergy wholesale commodities offers a valuable option taking into consideration the contango in the forward curve and the potential positive effects of ongoing economic growth (driving increased load, market heat rates, capacity prices and natural gas prices), new environmental legislation and / or enforcement of additional environmental regulation over the longer term.
  • corporate results:  results will vary depending upon factors including future effective income tax and interest rates and the amount / timing of share repurchases.

capital deployment:

  • a balanced capital investment / return program. entergy continues to see value-added investment opportunities at the utility in the coming years, as well as an investment outlook at entergy wholesale commodities that supports continued safe, secure, and reliable operations and opportunistic investments. entergy aspires to fund this capital program without issuing traditional common equity, while maintaining a competitive capital return program. given the company's financial profile with a mix of utility and non-utility businesses, return of capital is expected to be provided similar to the past through a combination of common stock dividends and share repurchases. absent other attractive investment opportunities, capital deployment through dividends and share repurchases could total as much as $4 – $5 billion from 2010 – 2014 under the current long-term business outlook. the amount of share repurchases may vary as a result of material changes in business results, capital spending or new investment opportunities.

credit quality:

  • strong liquidity.
  • solid credit metrics that support ready access to capital on reasonable terms.

沙特vs墨西哥让球 is an integrated energy company engaged primarily in electric power production and retail distribution operations. entergy owns and operates power plants with approximately 30,000 megawatts of electric generating capacity, and it is the second-largest nuclear generator in the united states. entergy delivers electricity to 2.7 million utility customers in arkansas, louisiana, mississippi and texas. entergy has annual revenues of more than $11 billion and approximately 15,000 employees.

additional information regarding entergy's quarterly results of operations, regulatory proceedings and other operations is available in entergy's investor news release dated feb. 8, 2011, a copy of which has been filed today with the securities and exchange commission on form 8-k and is available on entergy's investor relations website at www.entergy.com/investor_relations.

in this news release, and from time to time, 沙特vs墨西哥让球 makes certain "forward-looking statements" within the meaning of the private securities litigation reform act of 1995. except to the extent required by the federal securities laws, entergy undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise.

forward-looking statements involve a number of risks and uncertainties. there are factors that could cause actual results to differ materially from those expressed or implied in the forward-looking statements, including (a) those factors discussed in: (i) entergy's form 10-k for the year ended december 31, 2009; (ii) entergy's form 10-qs for the quarters ended march 31, 2010, june 30, 2010, and september 30, 2010; and (iii) entergy's other reports and filings made under the securities exchange act of 1934; (b) uncertainties associated with rate proceedings, formula rate plans and other cost recovery mechanisms; (c) uncertainties associated with efforts to remediate the effects of major storms and recover related restoration costs; (d) nuclear operating and regulatory risks; (e) legislative and regulatory actions; and (f) conditions in commodity and capital markets during the periods covered by the forward-looking statements, in addition to other factors described elsewhere in this release and in subsequent securities filings.

appendix a provides a reconciliation of gaap as-reported earnings to non-gaap operational earnings.

   

appendix a:  consolidated earnings – reconciliation of gaap to non-gaap measures

 

fourth quarter and year-to-date 2010 vs. 2009

 

(per share in u.s. $)

 
 

fourth quarter

year-to-date

 
 

2010

2009

change

2010

2009

change

 

as-reported

             

utility

0.63

0.72

(0.09)

4.33

3.53

0.80

 

entergy wholesale commodities

0.83

1.04

(0.21)

2.59

3.26

(0.67)

 

parent & other

(0.20)

(0.12)

(0.08)

(0.26)

(0.49)

0.23

 

 consolidated as-reported earnings

1.26

1.64

(0.38)

6.66

6.30

0.36

 
               

less special items

             

utility

 

entergy wholesale commodities

(0.04)

(0.06)

0.02

(0.54)

(0.23)

(0.31)

 

parent & other

(0.05)

0.05

0.10

(0.14)

0.24

 

 consolidated special items

(0.04)

(0.11)

0.07

(0.44)

(0.37)

(0.07)

 
               

operational

             

utility

0.63

0.72

(0.09)

4.33

3.53

0.80

 

entergy wholesale commodities

0.87

1.10

(0.23)

3.13

3.49

(0.36)

 

parent & other

(0.20)

(0.07)

(0.13)

(0.36)

(0.35)

(0.01)

 

 consolidated operational earnings

1.30

1.75

(0.45)

7.10

6.67

0.43

 
               
   
             
   

沙特vs墨西哥让球

 

consolidated income statement

 

three months ended december 31

 

(in thousands)

 
         
         
 

2010

 

2009

 
 

(unaudited)

 

operating revenues:

       

    electric

$1,880,845

 

$1,739,193

 

    natural gas

43,232

 

45,298

 

    competitive businesses

609,027

 

714,163

 

                     total

2,533,104

 

2,498,654

 

operating expenses:

       

   operation and maintenance:

       

        fuel, fuel-related expenses, and gas purchased for resale

579,505

 

382,139

 

        purchased power

283,361

 

360,721

 

        nuclear refueling outage expenses

64,728

 

62,856

 

        other operation and maintenance

758,020

 

729,348

 

    decommissioning

54,313

 

50,945

 

    taxes other than income taxes

133,702

 

118,211

 

    depreciation and amortization

280,502

 

283,592

 

    other regulatory charges (credits) – net

29,366

 

7,643

 

                     total

2,183,497

 

1,995,455

 

gain on sale of investment

44,173

 

-

 

operating income

393,780

 

503,199

 

other income (deductions):

       

    allowance for equity funds used during construction

13,391

 

12,046

 

    interest and dividend income

62,331

 

66,651

 

    other than temporary impairment losses

(123)

 

(703)

 

    miscellaneous - net

(16,073)

 

(19,483)

 

                     total

59,526

 

58,511

 

interest expense:

       

    interest expense

146,692

 

151,019

 

    allowance for borrowed funds used during construction

(7,705)

 

(6,688)

 

                     total

138,987

 

144,331

 

income before income taxes

314,319

 

417,379

 

income taxes

81,012

 

98,639

 

consolidated net income

233,307

 

318,740

 

preferred dividend requirements of subsidiaries

5,015

 

4,965

 

net income attributable to 沙特vs墨西哥让球

$228,292

 

$313,775

 
         
         

earnings per average common share

       

    basic

$1.27

 

$1.66

 

    diluted

$1.26

 

$1.64

 
         

average number of common shares outstanding - basic

180,199,914

 

188,996,969

 

average number of common shares outstanding - diluted

181,577,475

 

191,255,405

 
   
       
   

沙特vs墨西哥让球

 

consolidated income statement

 

twelve months ended december 31

 

(in thousands)

 
         
         
 

2010

 

2009

 
 

(unaudited)

 

operating revenues:

       

    electric

$8,740,637

 

$7,880,016

 

    natural gas

197,658

 

172,213

 

    competitive businesses

2,549,282

 

2,693,421

 

                     total

11,487,577

 

10,745,650

 

operating expenses:

       

   operation and maintenance:

       

        fuel, fuel-related expenses, and gas purchased for resale

2,518,582

 

2,309,831

 

        purchased power

1,659,416

 

1,395,203

 

        nuclear refueling outage expenses

256,123

 

241,310

 

        other operation and maintenance

2,969,402

 

2,750,810

 

    decommissioning

211,736

 

199,063

 

    taxes other than income taxes

534,299

 

503,859

 

    depreciation and amortization

1,069,894

 

1,082,775

 

    other regulatory charges (credits) – net

44,921

 

(21,727)

 

                     total

9,264,373

 

8,461,124

 

gain on sale of investment

44,173

 

-

 

operating income

2,267,377

 

2,284,526

 

other income (deductions):

       

    allowance for equity funds used during construction

59,381

 

59,545

 

    interest and dividend income

185,455

 

236,628

 

    other than temporary impairment losses

(1,378)

 

(86,069)

 

    miscellaneous - net

(48,124)

 

(40,396)

 

                     total

195,334

 

169,708

 

interest expense:

       

    interest expense

610,146

 

603,679

 

    allowance for borrowed funds used during construction

(34,979)

 

(33,235)

 

                     total

575,167

 

570,444

 

income before income taxes

1,887,544

 

1,883,790

 

income taxes

617,239

 

632,740

 

consolidated net income

1,270,305

 

1,251,050

 

preferred dividend requirements of subsidiaries

20,063

 

19,958

 

net income attributable to 沙特vs墨西哥让球

$1,250,242

 

$1,231,092

 
         
         

earnings per average common share

       

    basic

$6.72

 

$6.39

 

    diluted

$6.66

 

$6.30

 
         

average number of common shares outstanding - basic

186,010,452

 

192,772,032

 

average number of common shares outstanding - diluted

187,814,235

 

195,838,068

 
   
       
   

沙特vs墨西哥让球

 

utility electric energy sales & customers

 
               

three months ended december 31

 
                   
   

2010

 

2009

 

%

change

 

%

weather-

adjusted

 
   

(millions of kwh)

         

electric energy sales:

                 

residential

 

7,750

 

7,421

 

4.4

 

0.6

 

commercial

 

6,896

 

6,635

 

3.9

 

1.7

 

governmental

 

608

 

605

 

0.5

 

(0.2)

 

industrial

 

9,880

 

9,235

 

7.0

 

7.0

 

   total to ultimate customers

 

25,134

 

23,896

 

5.2

 

3.3

 

wholesale

 

1,021

 

998

 

2.3

     

   total sales

 

26,155

 

24,894

 

5.1

     
                   
                   
                   

twelve months ended december 31

 
   

2010

 

2009

 

%

change

 

%

weather-

adjusted

 
   

(millions of kwh)

         

electric energy sales:

                 

residential

 

37,465

 

33,626

 

11.4

 

1.8

 

commercial

 

28,831

 

27,476

 

4.9

 

2.0

 

governmental

 

2,463

 

2,408

 

2.3

 

1.7

 

industrial

 

38,751

 

35,638

 

8.7

 

8.7

 

   total to ultimate customers

 

107,510

 

99,148

 

8.4

 

4.3

 

wholesale

 

4,372

 

4,862

 

(10.1)

     

   total sales

 

111,882

 

104,010

 

7.6

     
                   
                   
                   

december 31

 
                   
   

2010

 

2009

 

%

change

     

electric customers  (end of period):

               

residential

 

2,349,900

 

2,331,433

 

0.8

     

commercial

 

335,121

 

330,908

 

1.3

     

governmental

 

16,619

 

16,017

 

3.8

     

industrial

 

41,383

 

40,757

 

1.5

     

   total ultimate customers

 

2,743,023

 

2,719,115

 

0.9

     

wholesale

 

23

 

25

 

(8.0)

     

   total customers

 

2,743,046

 

2,719,140

 

0.9

     
 

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