news release > entergy reports second quarter earnings

for immediate release

entergy reports second quarter earnings

08/03/2010

new orleans – 沙特vs墨西哥让球 (nyse: etr) today reported second quarter 2010 as-reported earnings of $315.3 million, or $1.65 per share, compared with $226.8 million, or $1.14 per share, for second quarter 2009. on an operational basis, entergy's second quarter 2010 earnings were $325.7 million, or $1.71 per share, compared with $244.0 million, or $1.23 per share, in second quarter 2009.

   

consolidated earnings – reconciliation of gaap to non-gaap measures

 

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

 

(per share in u.s. $)

             
 

second quarter

year-to-date

 
 

2010

2009

change

2010

2009

change

 

as-reported earnings

1.65

1.14

0.51

2.77

2.35

0.42

 

less special items

(0.06)

(0.09)

0.03

(0.26)

(0.17)

(0.09)

 

operational earnings

1.71

1.23

0.48

3.03

2.52

0.51

 
   

*gaap refers to united states generally accepted accounting principles.

 
             

operational earnings highlights for second quarter 2010

  • utility's results were higher due primarily to higher net revenue from increased sales volumes across all customer classes, including the effect of warmer-than-normal weather, and previous rate actions.
  • entergy nuclear's earnings increased as a result of higher net revenue resulting primarily from higher generation due to fewer planned and unplanned outage days and the absence of significant impairments associated with decommissioning trusts recorded in second quarter 2009.
  • parent & other's results were lower due primarily to higher income tax expense on parent & other activities.

"while the national economy continues to produce mixed results, both our utility and  non-utility nuclear businesses are delivering solid performance through our focus on operational excellence, attentive management of risk and our strong cash position," said j. wayne leonard, entergy's chairman and chief executive officer. "even as we achieve near-term success in this uncertain economic climate, we continue to plan and execute with the long-term goal of producing sustained value for all of our stakeholders."

other business highlights

  • the arkansas public service commission approved a unanimous settlement agreement reflecting a rate increase of approximately $63.7 million for entergy arkansas.
  • entergy gulf states louisiana, l.l.c. and entergy louisiana, llc received over $700 million of storm financing proceeds, including $290 million in storm reserves.
  • vermont yankee operated for 532 consecutive days prior to its planned refueling outage, its second such breaker-to-breaker run in the past four and a half years.
  • employees at the palisades power plant took home the highest honor in the nuclear energy institute's annual top industry practice awards, the b. ralph sylvia "best of the best" award, over 14 other category winners.

entergy will host a teleconference to discuss this release at 10 a.m. ct on tuesday, aug. 3, 2010, with access by telephone, 719-457-2080, confirmation code 1327346. 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 aug. 10, 2010, by dialing 719-457-0820, confirmation code 1327346. the replay will also be available on entergy's website at www.entergy.com.

utility

in second quarter 2010, utility's as-reported and operational earnings were $225.8 million, or $1.18 per share, compared to $147.2 million, or 74 cents per share, on the same bases in second quarter 2009. earnings for the utility in the current quarter reflect higher net revenue due to increased sales across all customer classes and rate adjustments at entergy gulf states louisiana, entergy louisiana and entergy mississippi under their formula rate plans. in addition, second quarter 2009 results included a regulatory charge at entergy texas associated with a may 2009 federal energy regulatory commission order. partially offsetting higher utility net revenue was an increase in interest expense on higher debt borrowings.

residential sales in second quarter 2010, on a weather-adjusted basis, increased 2.1 percent compared to second quarter 2009. commercial and governmental sales, on a weather-adjusted basis, increased 1.5 percent quarter over quarter. industrial sales in the second quarter increased 12.2 percent compared to the same quarter of 2009.

residential, commercial and industrial classes reflected sales growth with a continuation of the recovery in economic activity evidenced earlier this year in entergy's service territory. the improvement in industrial sales in second quarter 2010 was driven by the need to build inventories, a rebound in the auto industry and rising exports with the chemicals, refineries and primary metals sectors realizing most of the benefits. some declines in pipelines and pulp and paper partially offset an otherwise robust recovery in the industrial base. small and mid-sized industrial customers continued to see recovery benefiting from global industrial expansion. warmer-than-normal weather also contributed to the increase in sales volume.

entergy nuclear

entergy nuclear earned $119.5 million, or 63 cents per share, on an as-reported basis in second quarter 2010, compared to as-reported earnings of $80.2 million, or 40 cents per share, in second quarter 2009. on an operational basis, second quarter 2010 entergy nuclear's earnings were $134.0 million, or 71 cents per share, versus $95.3 million, or 48 cents per share, in the second quarter of the prior year. entergy nuclear's operational earnings increased as a result of higher net revenue due primarily to higher generation resulting from fewer planned and unplanned outages. also, contributing to the increase in earnings was the absence of significant impairments associated with decommissioning trusts recorded in second quarter 2009. partially offsetting the increase was lower pricing and higher non-fuel operation and maintenance expense due primarily to tritium remediation work at the vermont yankee site, a lower amount deferred for later amortization due to fewer refueling outage days and higher pension and benefits expense.

parent & other

parent & other reported a loss of $30.1 million, or 16 cents per share, on an as-reported basis in second quarter 2010 compared to an as-reported loss of $0.6 million, or less than 1 cent per share, in second quarter 2009. on an operational basis, parent & other reported a loss of $34.1 million, or 18 cents per share, in the current quarter and earnings of $1.4 million, or 1 cent per share, in second quarter 2009. higher income tax expense on parent & other activities was the primary factor driving results for the quarter.

outlook

entergy affirmed its earnings guidance ranges of $5.95 to $6.80 per share on an as-reported basis and $6.40 to $7.20 per share on an operational basis. on april 15, 2010, entergy revised its 2010 as-reported earnings guidance to a range of $5.95 to $6.80 per share from $6.15 to $6.95 per share to reflect the potential charge in connection with the previously announced business unwind of the internal organizations created for enexus energy corporation and equagen llc. this charge will be classified as a special item in 2010, and therefore is excluded from the operational earnings per share guidance range. the total potential charge estimated at $0.40 to $0.45 per share as of april 2010, includes previously identified special items for spin-off dis-synergies and expenses for outside services provided to pursue the spin-off, for which $0.25 per share had already been reflected in as-reported earnings guidance. entergy has initiated efforts to eliminate spin-off dis-synergies as soon as possible during 2010.

overarching financial aspiration

entergy continues to aspire to deliver superior value to owners as measured by total shareholder return. the company believes top-quartile total shareholder returns are achieved by:

  • operating the business with the highest expectations and standards,
  • executing on earnings growth opportunities while managing commodity and other business risks,
  • delivering returns at or above the risk-adjusted cost of capital for each initiative, project, business, etc.,
  • maintaining credit quality and flexibility,
  • deploying capital in a disciplined manner, whether for new investments, share repurchases, dividends or debt retirements, and
  • being disciplined as either a buyer or a seller consistent with the market or entergy's proprietary point-of-view.

long-term financial outlook

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

earnings:

  • utility net income:  5 to 6 percent compound annual net income growth rate over the 2010 – 2014 horizon (2009 base year).
  • entergy nuclear results:  revenue projections over the next five years are expected to routinely fluctuate based on commodity markets – one of the most important fundamental drivers for this business. while current forward power prices would show a decline in the long-term financial outlook for this business compared to 2010, entergy nuclear offers a valuable option taking into consideration the contango forward curve and the potential positive effects of an economic rebound (on market heat rates, capacity markets and natural gas prices), new environmental legislation and / or regulation over the longer term.
  • corporate results:  results will vary depending upon factors including future effective income tax and interest rates, the amount of share repurchases and the ability to achieve the targeted break-even financial results for the non-nuclear wholesale assets business.

capital deployment:

  • a balanced capital investment / return program. entergy continues to see productive investment opportunities at the utility in the coming years, as well as an investment outlook at entergy nuclear 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 $5 billion over the next five years under the current long-term business outlook. the amount of share repurchases may vary as a result of material changes in business results or 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 $10 billion and more than 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 aug. 3, 2010, 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-q for the quarter ended march 31, 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, and (e) legislative and regulatory actions, and 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

 

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

 

(per share in u.s. $)

 
 

second quarter

year-to-date

 
 

2010

2009

change

2010

2009

change

 

as-reported

             

utility

1.18

0.74

0.44

1.91

1.31

0.60

 

entergy nuclear

0.63

0.40

0.23

1.12

1.32

(0.20)

 

parent & other

(0.16)

-

(0.16)

(0.26)

(0.28)

0.02

 

 consolidated as-reported earnings

1.65

1.14

0.51

2.77

2.35

0.42

 
               

less special items

             

utility

-

-

-

-

-

-

 

entergy nuclear

(0.08)

(0.08)

-

(0.36)

(0.11)

(0.25)

 

parent & other

0.02

(0.01)

0.03

0.10

(0.06)

0.16

 

 consolidated special items

(0.06)

(0.09)

0.03

(0.26)

(0.17)

(0.09)

 
               

operational

             

utility

1.18

0.74

0.44

1.91

1.31

0.60

 

entergy nuclear

0.71

0.48

0.23

1.48

1.43

0.05

 

parent & other

(0.18)

0.01

(0.19)

(0.36)

(0.22)

(0.14)

 

 consolidated operational earnings

1.71

1.23

0.48

3.03

2.52

0.51

 
               
   
             
   

沙特vs墨西哥让球

 

consolidated income statement

 

three months ended june 30

 

(in thousands)

 
             
             
 

2010

 

2009

 

% inc/(dec)

 
 

(unaudited)

   

operating revenues:

           

    electric

$2,214,108

 

$1,918,446

 

15.4

 

    natural gas

31,136

 

28,834

 

8.0

 

    competitive businesses

617,706

 

573,509

 

7.7

 

                     total

2,862,950

 

2,520,789

 

13.6

 

operating expenses:

           

   operation and maintenance:

           

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

631,546

 

521,071

 

21.2

 

        purchased power

416,458

 

322,919

 

29.0

 

        nuclear refueling outage expenses

64,221

 

60,234

 

6.6

 

        other operation and maintenance

700,204

 

696,345

 

0.6

 

    decommissioning

52,467

 

49,307

 

6.4

 

    taxes other than income taxes

126,968

 

122,401

 

3.7

 

    depreciation and amortization

255,567

 

260,689

 

(2.0)

 

    other regulatory charges (credits) – net

(10,722)

 

13,327

 

(180.5)

 

                     total

2,236,709

 

2,046,293

 

9.3

 

operating income

626,241

 

474,496

 

32.0

 

other income (deductions):

           

    allowance for equity funds used during construction

17,630

 

15,782

 

11.7

 

    interest and dividend income

35,792

 

58,892

 

(39.2)

 

    other than temporary impairment losses

(837)

 

(69,203)

 

(98.8)

 

    miscellaneous - net

(16,780)

 

(13,354)

 

25.7

 

                     total

35,805

 

(7,883)

 

(554.2)

 

interest and other charges:

           

    interest on long-term debt

127,302

 

125,157

 

1.7

 

    other interest - net

20,877

 

27,487

 

(24.0)

 

    allowance for borrowed funds used during construction

(10,323)

 

(8,483)

 

21.7

 

                     total

137,856

 

144,161

 

(4.4)

 

income before income taxes

524,190

 

322,452

 

62.6

 

income taxes

203,907

 

90,641

 

125.0

 

consolidated net income

320,283

 

231,811

 

38.2

 

preferred dividend requirements of subsidiaries

5,017

 

4,998

 

0.4

 

net income attributable to 沙特vs墨西哥让球

$315,266

 

$226,813

 

39.0

 
             
             

earnings per average common share

           

    basic

$1.67

 

$1.16

 

44.0

 

    diluted

$1.65

 

$1.14

 

44.7

 
             

average number of common shares outstanding - basic

188,776,240

 

196,105,002

     

average number of common shares outstanding - diluted

190,717,958

 

198,243,169

     
   
             
   

沙特vs墨西哥让球

 

consolidated income statement

 

six months ended june 30

 

(in thousands)

 
             
             
 

2010

 

2009

 

% inc/(dec)

 
 

(unaudited)

   

operating revenues:

           

    electric

$4,221,038

 

$3,945,363

 

7.0

 

    natural gas

127,163

 

102,884

 

23.6

 

    competitive businesses

1,274,095

 

1,261,654

 

1.0

 

                     total

5,622,296

 

5,309,901

 

5.9

 

operating expenses:

           

   operation and maintenance:

           

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

1,190,214

 

1,367,060

 

(12.9)

 

        purchased power

891,361

 

646,174

 

37.9

 

        nuclear refueling outage expenses

126,510

 

117,013

 

8.1

 

        other operation and maintenance

1,402,692

 

1,341,389

 

4.6

 

    decommissioning

104,043

 

98,050

 

6.1

 

    taxes other than income taxes

262,380

 

256,798

 

2.2

 

    depreciation and amortization

524,771

 

518,541

 

1.2

 

    other regulatory charges (credits) – net

17,370

 

(16,147)

 

(207.6)

 

                     total

4,519,341

 

4,328,878

 

4.4

 

operating income

1,102,955

 

981,023

 

12.4

 

other income (deductions):

           

    allowance for equity funds used during construction

30,926

 

32,730

 

(5.5)

 

    interest and dividend income

84,213

 

105,278

 

(20.0)

 

    other than temporary impairment losses

(1,049)

 

(84,939)

 

(98.8)

 

    miscellaneous - net

(17,302)

 

(26,653)

 

(35.1)

 

                     total

96,788

 

26,416

 

266.4

 

interest and other charges:

           

    interest on long-term debt

294,237

 

253,123

 

16.2

 

    other interest - net

33,142

 

46,780

 

(29.2)

 

    allowance for borrowed funds used during construction

(18,325)

 

(18,294)

 

0.2

 

                     total

309,054

 

281,609

 

9.7

 

income before income taxes

890,689

 

725,830

 

22.7

 

income taxes

351,592

 

253,686

 

38.6

 

consolidated net income

539,097

 

472,144

 

14.2

 

preferred dividend requirements of subsidiaries

10,033

 

9,996

 

0.4

 

net income attributable to 沙特vs墨西哥让球

$529,064

 

$462,148

 

14.5

 
             
             

earnings per average common share

           

    basic

$2.80

 

$2.38

 

17.6

 

    diluted

$2.77

 

$2.35

 

17.9

 
             

average number of common shares outstanding - basic

188,988,284

 

194,359,001

     

average number of common shares outstanding - diluted

190,999,699

 

198,150,768

     
   
             
   

沙特vs墨西哥让球

 

utility electric energy sales & customers

 
               

three months ended june 30

 
                   
   

2010

 

2009

 

%
change

 

%
weather-
adjusted

 
   

(millions of kwh)

         

electric energy sales:

                 

residential

 

7,705

 

7,100

 

8.5

 

2.1

 

commercial

 

6,803

 

6,518

 

4.4

 

1.7

 

governmental

 

581

 

577

 

0.7

 

(0.1)

 

industrial

 

9,862

 

8,790

 

12.2

 

12.2

 

   total to ultimate customers

 

24,951

 

22,985

 

8.6

 

5.8

 

wholesale

 

971

 

1,313

 

(26.0)

     

   total sales

 

25,922

 

24,298

 

6.7

     
                   
                   
                   

six months ended june 30

 
   

2010

 

2009

 

%
change

 

%
weather-
adjusted

 
   

(millions of kwh)

         

electric energy sales:

                 

residential

 

17,350

 

14,992

 

15.7

 

3.0

 

commercial

 

13,275

 

12,711

 

4.4

 

2.3

 

governmental

 

1,173

 

1,140

 

2.9

 

3.2

 

industrial

 

18,596

 

16,929

 

9.8

 

9.8

 

   total to ultimate customers

 

50,394

 

45,772

 

10.1

 

5.3

 

wholesale

 

2,287

 

2,700

 

(15.3)

     

   total sales

 

52,681

 

48,472

 

8.7

     
                   
                   
                   

june 30

 
                 
   

2010

 

2009

 

%  
change  

   

electric customers  (end of period):

   

residential

 

2,351,556

 

2,330,337

 

0.9

   

commercial

 

334,179

 

330,891

 

1.0

   

governmental

 

16,134

 

15,523

 

3.9

   

industrial

 

45,841

 

43,864

 

4.5

   

   total ultimate customers

 

2,747,710

 

2,720,615

 

1.0

   

wholesale

 

25

 

33

 

(24.2)

   

   total customers

 

2,747,735

 

2,720,648

 

1.0