Entergy Reports Fourth Quarter And Full Year Earnings, Initiates 2016 Operational Earnings Guidance

2015 results consistent with latest guidance; accomplishments set stage for future growth

Feb 18, 2016, 06:30 ET from Entergy Corporation

NEW ORLEANS, Feb. 18, 2016 /PRNewswire/ -- Entergy Corporation (NYSE: ETR) reported fourth quarter 2015 earnings per share of 56 cents on an as-reported basis and $1.58 on an operational basis. For the full year, the company realized a loss of 99 cents per share on an as-reported basis and operational EPS of $6.00 per share. The as-reported loss resulted from asset impairments in the third and fourth quarters reflecting the effects of strategic decisions in the Entergy Wholesale Commodities business to reduce the company's exposure to volatile and poorly structured wholesale power markets.

"In 2015, we successfully worked through an extensive to-do list aimed at laying the foundation for steady and predictable Utility, Parent & Other earnings growth and improving certainty in our merchant generation business. Some of these actions, while necessary, were difficult for our stakeholders and impacted our as-reported financial results for the year," said Entergy chairman and chief executive officer Leo Denault. "On an operational basis, our final 2015 results are in line with the expectations we shared with you last fall. We are also initiating 2016 guidance indicating strong Utility growth in large part due to the strategic accomplishments of last year, again consistent with indications on Utility, Parent & Other growth since the middle of last year and the ranges we gave at our last Analyst Day in 2014."

Additional business highlights included the following:

  • 2016 operational EPS guidance range is $4.95 to $5.75 for Entergy consolidated; the range for Utility, Parent & Other Adjusted EPS is $4.20 to $4.50.
  • Entergy Arkansas, Inc. filed an unopposed settlement agreement in its rate case.
  • The sale of the Rhode Island State Energy Center power plant closed in December.
  • Entergy announced the shutdown date for the James A. FitzPatrick Nuclear Power Plant is planned to be Jan. 27, 2017.
  • Independent system operators' reliability studies found that FitzPatrick and the Pilgrim Nuclear Power Station (beyond June 1, 2019) are not required for their respective regions.
  • For the 18th consecutive year, the Edison Electric Institute awarded Entergy's storm team with a national storm restoration award.

 

Consolidated Earnings (GAAP and Non-GAAP measures)

Fourth Quarter and Year-to-Date 2015 vs. 2014 (See Appendix A for reconciliation of GAAP to non-GAAP measures)

Fourth Quarter

Year-to-Date

2015

2014

Change

2015

2014

Change

As-Reported Earnings (Loss) ($ in millions)

99.6

120.1

(20.6)

(176.6)

940.7

(1,117.3)

Less Special Items

(183.0)

(15.2)

(167.8)

(1,252.4)

(109.4)

(1,143.0)

Operational Earnings

282.6

135.3

147.3

1,075.9

1,050.0

25.8

Weather Impact

(6.1)

9.6

(15.7)

34.6

12.8

21.8

As-Reported Earnings (Loss) (per share in $)

0.56

0.66

(0.10)

(0.99)

5.22

(6.21)

Less: Special Items

(1.02)

(0.09)

(0.93)

(6.99)

(0.61)

(6.38)

Operational Earnings

1.58

0.75

0.83

6.00

5.83

0.17

Weather Impact

(0.03)

0.05

(0.08)

0.19

0.07

0.12

Totals may not foot due to rounding

Business Unit Results

In addition to the summary business unit discussions below and results provided in Appendix A, a comprehensive analysis of quarterly and year-to-date variances is provided in Appendix B to this release. Appendix A also provides information on operating cash flow by business.

Utility, Parent & Other Results

For fourth quarter 2015, Utility, Parent and Other EPS were $1.42 on an as-reported and an operational basis. In comparison, 2014 fourth quarter earnings were 35 cents per share on an as-reported basis and 36 cents per share on an operational basis. Operational results for the 2015 quarterly period included a significant income tax item, a portion of which will be shared with customers of Entergy Louisiana, LLC. The quarter's results also reflected the effects of productive investments as well as milder weather, charges reflecting progress in resolving long outstanding regulatory matters and higher operating expenses.

Billed retail sales volume decreased (1.1) percent quarter-to-quarter on the effects of weather. On a weather-adjusted basis, billed volume increased 0.8 percent; the components of the weather-adjusted sales growth were:

  • Weather-adjusted residential sales increase of 1.6 percent,
  • Commercial sales slight decrease of (0.1) percent on a weather-adjusted basis,
  • Weather-adjusted governmental sales increase of 4.2 percent and
  • Industrial sales increase of 0.6 percent.

Industrial sales were higher on continued growth for new and expansion customers. Sales to existing industrial customers declined on lower usage from large chlor-alkali customers, due to both outages as well as softer economics. Partially offsetting was favorable macro conditions for existing petroleum refining customers who operated at high levels.

Utility results reflected rate adjustments for the Ninemile Point Unit 6 plant that went in service at the end of 2014 and the Entergy Mississippi, Inc. rate case. Revenue increases from rate actions were largely offset by changes in other line items (e.g., non-fuel operation and maintenance and depreciation expenses).

For the full year, 2015 Utility, Parent and Other EPS were $4.97 on an as-reported and an operational basis. In comparison, 2014 earnings were $3.60 per share on an as-reported basis and $3.64 per share on an operational basis. Operational results for 2015 included significant income tax items, as discussed above. Results also reflected productive investments and favorable weather, as well as higher operating expenses.

For a schedule of Utility, Parent & Other Adjusted EPS for the quarter and full year excluding special items and weather, normalizing tax items and excluding utility charges, see Appendix C. Appendix C also contains additional details on the Utility's performance for both periods.

Entergy Wholesale Commodities Results

EWC operational adjusted earnings before interest, taxes, depreciation and amortization were $70 million in fourth quarter 2015, compared to $183 million in the same period a year ago. The quarter-over-quarter decrease was driven largely by lower energy and capacity prices for EWC's nuclear assets. Quarter-over-quarter results were also affected by impairments of FitzPatrick and Pilgrim recorded in third quarter 2015 which lowered fuel and non-fuel O&M expenses.

EWC Operational Adjusted EBITDA - Reconciliation of GAAP to Non-GAAP Measures

Fourth Quarter and Year-to-Date 2015 vs. 2014

($ in millions)

Fourth Quarter

Year-to-Date

2015

2014

Change

2015

2014

Change

Net income

(154)

58

(212)

(1,066)

295

(1,361)

Add back: interest expense

8

5

3

27

17

10

Add back: income tax expense

(123)

36

(159)

(610)

177

(787)

Add back: depreciation and amortization

53

63

(10)

239

276

(37)

Subtract: interest and investment income

33

37

(4)

149

114

35

Add back: decommissioning expense

36

38

(2)

138

142

(4)

Adjusted EBITDA

(213)

162

(375)

(1,421)

792

(2,213)

Add back pre-tax special items for:

  HCM implementation

-

1

(1)

-

3

(3)

  Decisions to close VY, FitzPatrick and Pilgrim

5

20

(15)

1,658

154

1,504

  Palisades asset impairment and related write-offs

396

-

396

396

-

396

  Top Deer investment impairment

37

-

37

37

-

37

  Gain on the sale of RISEC

(154)

-

(154)

(154)

-

(154)

Operational adjusted EBITDA

70

183

(113)

515

950

(435)

Totals may not foot due to rounding

EWC reported an as-reported loss of (86) cents per share in the current quarter compared to a fourth quarter 2014 as-reported EPS of 31 cents. Fourth quarter 2015 as-reported results included non-cash asset impairments for Palisades and EWC's wind investment, which were classified as a special item and therefore, excluded from operational results. The impairment charges resulted from analyzing EWC's remaining assets for impairment in light of Entergy's decisions to operate its other northern U.S. single unit nuclear sites for a shorter period than their operating license expiration dates and the sale of non-nuclear assets in the fourth quarter 2015. Depressed market prices were a significant factor in the analysis resulting in impairment charges for Palisades and the wind investment. The Palisades impairment does not reflect any decision to modify the continuing operations of the plant, which operates under a power purchase agreement that runs until April 2022. The sale of RISEC (a non-nuclear asset) in the current quarter resulted in a 56 cent per share gain, which is also classified as a special and excluded from operational results.

Fourth quarter 2015 EWC operational earnings were 16 cents per share, compared to 39 cents per share in the fourth quarter 2014. This decline was driven by lower operational adjusted EBITDA. The current quarter results also included income tax items.

For the year, EWC reported a loss of $5.96 per share on an as-reported basis and earnings of $1.03 per share on an operational basis, compared to as-reported EPS of $1.62 and operational EPS of $2.19 in 2014. The decline in operational earnings was driven by lower energy and capacity revenue for the nuclear fleet, which is also reflected in the lower operational adjusted EBITDA. The closure of VY at the end of 2014 also contributed to the reduced operational adjusted EBITDA and operational EPS.

For additional details on EWC's performance for the quarter and full year, see Appendix D and the webcast slide presentation.

Earnings Guidance

Entergy is initiating 2016 operational earnings guidance in the range of $4.95 to $5.75 per share. The Utility, Parent & Other Adjusted EPS guidance range is $4.20 to $4.50. See the webcast slide presentation for additional details.

Earnings Teleconference

A teleconference will be held at 10 a.m. CT on Thursday, Feb. 18, 2016, to discuss Entergy's fourth quarter and full year 2015 earnings announcement and the company's financial performance. The teleconference may be accessed by visiting Entergy's website at www.entergy.com or by dialing (855) 893-9849, conference ID 85410755, no more than 15 minutes prior to the start of the call. The webcast slide presentation is also posted to Entergy's website concurrent with this release, which was issued before market open on the day of the call. A replay of the teleconference will be available on Entergy's website at www.entergy.com and by telephone. The telephone replay will be available through Feb. 25, 2016, by dialing (855) 859-2056, conference ID 85410755. This release and the webcast slide presentation are also available on the Entergy Investor Relations mobile web app at iretr.com.

Entergy Corporation 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, including nearly 10,000 megawatts of nuclear power. Entergy delivers electricity to 2.8 million utility customers in Arkansas, Louisiana, Mississippi and Texas. Entergy has annual revenues of approximately $11.5 billion and more than 13,000 employees.

Entergy Corporation's common stock is listed on the New York and Chicago exchanges under the symbol "ETR."

Additional information regarding Entergy's quarterly and full year results of operations, regulatory proceedings and other matters is available in Entergy's earnings release package, a copy of which will be filed with the U.S. Securities and Exchange Commission, and the webcast slide presentation. The earnings package contains appendices to this release and financial statements. Both the earnings release package and webcast slide presentation are available on Entergy's Investor Relations website at www.entergy.com/investor_relations and on Entergy's Investor Relations mobile web app at iretr.com.

Cautionary Note Regarding Forward-Looking Statements

In this news release, and from time to time, Entergy Corporation makes certain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements include, among other things, Entergy's 2016 earnings guidance, its current financial and operational outlook, and other statements of Entergy's plans, beliefs or expectations included in this news release. 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 are subject to a number of risks, uncertainties and other factors that could cause actual results to differ materially from those expressed or implied in such forward-looking statements, including (a) those factors discussed elsewhere in this news release and in Entergy's most recent Annual Report on Form 10-K, any subsequent Quarterly Reports on Form 10-Q and 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 plant relicensing, operating and regulatory risks, including any changes resulting from the nuclear crisis in Japan following its catastrophic earthquake and tsunami; (e) changes in decommissioning trust fund values or earnings or in the timing or cost of decommissioning FitzPatrick, Pilgrim or VY or any of Entergy's other nuclear plant sites; (f) legislative and regulatory actions and risks and uncertainties associated with claims or litigation by or against Entergy and its subsidiaries; (g) risks and uncertainties associated with strategic transactions that Entergy or its subsidiaries may undertake, including the pending acquisition of the Union Power Station near El Dorado, Arkansas, including the risk that any such transaction may not be completed as and when expected and the risk that the anticipated benefits of the transaction may not be realized and (h) economic conditions and conditions in commodity and capital markets during the periods covered by the forward-looking statements.

For definitions of certain operational performance measures, as well as GAAP and non-GAAP financial measures and abbreviations and acronyms used in the quarterly materials, see Appendix F and Appendix G.

Fourth Quarter 2015 Earnings Release Package

Appendices Seven appendices are presented in this section as follows:

  • Appendix A: Consolidated Results and Special Items
  • Appendix B: Variance Analysis
  • Appendix C: Utility Financial and Performance Measures
  • Appendix D: EWC Performance Measures
  • Appendix E: Financial Performance Measures
  • Appendix F: Definitions, Abbreviations and Acronyms
  • Appendix G: GAAP to Non-GAAP Reconciliations

Also included in this earnings release package are:

  • Financial Statements

Accompanying the earnings package is a webcast slide presentation.

A: Consolidated Results and Special Items Appendix A-1 provides a comparative summary of consolidated EPS for fourth quarter and year-to-date 2015 versus 2014, including a reconciliation of GAAP as-reported earnings to non-GAAP operational earnings.

Appendix A-1: Consolidated Earnings - Reconciliation of GAAP to Non-GAAP Measures

Fourth Quarter and Year-to-Date 2015 vs. 2014 (See Appendix A-3 and Appendix A-4 for details on special items)

(Per share in $)

Fourth Quarter

Year-to-Date

2015

2014

Change

2015

2014

Change

As-Reported

Utility

1.75

0.60

1.15

6.12

4.60

1.52

Parent & Other

(0.33)

(0.25)

(0.08)

(1.15)

(1.00)

(0.15)

EWC

(0.86)

0.31

(1.17)

(5.96)

1.62

(7.58)

  Consolidated As-Reported Earnings (Loss)

0.56

0.66

(0.10)

(0.99)

5.22

(6.21)

Less Special Items

Utility

-

(0.01)

0.01

-

(0.04)

0.04

Parent & Other

-

-

-

-

-

-

EWC

(1.02)

(0.08)

(0.94)

(6.99)

(0.57)

(6.42)

  Consolidated Special Items

(1.02)

(0.09)

(0.93)

(6.99)

(0.61)

(6.38)

Operational

Utility

1.75

0.61

1.14

6.12

4.64

1.48

Parent & Other

(0.33)

(0.25)

(0.08)

(1.15)

(1.00)

(0.15)

EWC

0.16

0.39

(0.23)

1.03

2.19

(1.16)

  Consolidated Operational Earnings

1.58

0.75

0.83

6.00

5.83

0.17

Weather Impact

(0.03)

0.05

(0.08)

0.19

0.07

0.12

Detailed earnings variance analyses are included in Appendix B-1 and Appendix B-2.

Appendix A-2 provides the components of OCF contributed by each business with current quarter and year-to-date comparisons.

Appendix A-2: Consolidated Operating Cash Flow

Fourth Quarter and Year-to-Date 2015 vs. 2014

($ in millions)

Fourth Quarter

Year-to-Date

2015

2014

Change

2015

2014

Change

Utility

858

1,076

(218)

2,907

3,319

(412)

Parent & Other

3

(256)

259

(78)

(463)

385

EWC

81

178

(97)

462

1,034

(572)

  Total Operating Cash Flow

942

998

(56)

3,291

3,890

(599)

Totals may not foot due to rounding

The primary driver of the $(56) million quarter-over-quarter decrease was lower EWC net revenue, partially offset by lower pension funding. Favorable changes in the timing of working capital at the Utility primarily in deferred fuel from low natural gas prices were largely offset by unfavorable changes in working capital at EWC. Intercompany income tax payments contributed to the line of business variances, but netted to a small number at the consolidated level.

The primary drivers of the year-over-year $(599) million decrease were lower EWC net revenue and receipt of securitization funds in 2014. Favorable deferred fuel changes at the Utility also benefitted the full year period. Intercompany income tax payments affected line of business variances but had a small bottom-line impact.

Appendix A-3 and Appendix A-4 list special items by business. Amounts are shown on both an EPS basis and a net income basis. Special items are those events that are not routine. Special items are included in as-reported EPS consistent with GAAP, but are excluded from operational EPS. As a result, operational EPS is considered a non-GAAP measure.

Appendix A-3: Special Items by Driver (shown as positive/(negative) impact on EPS)

Fourth Quarter and Year-to-Date 2015 vs. 2014

(After-tax, per share in $)

Fourth Quarter

Year-to-Date

2015

2014

Change

2015

2014

Change

Utility

HCM implementation expenses

-

(0.01)

0.01

-

(0.04)

0.04

  Total Utility

-

(0.01)

0.01

-

(0.04)

0.04

EWC

HCM implementation expenses

-

-

-

-

(0.01)

0.01

Decisions to close VY, FitzPatrick and Pilgrim

(0.02)

(0.08)

0.06

(5.99)

(0.56)

(5.43)

Palisades asset impairment and related write-offs

(1.43)

-

(1.43)

(1.43)

-

(1.43)

Top Deer investment impairment

(0.13)

-

(0.13)

(0.13)

-

(0.13)

Gain on the sale of RISEC

0.56

-

0.56

0.56

-

0.56

  Total EWC

(1.02)

(0.08)

(0.94)

(6.99)

(0.57)

(6.42)

Total Special Items

(1.02)

(0.09)

(0.93)

(6.99)

(0.61)

(6.38)

 

Appendix A-4: Special Items by Income Statement Line Item (shown as positive/(negative) impact on earnings)

Fourth Quarter and Year-to-Date 2015 vs. 2014

(Pre-tax except for Income taxes - other, $ in millions)

Fourth  Quarter

Year-to-Date

2015

2014

Change

2015

2014

Change

Utility

Non-fuel O&M

-

(2.4)

2.4

-

(12.6)

12.6

Taxes other than income taxes

-

(0.1)

0.1

-

(0.6)

0.6

Income taxes - other

-

1.0

(1.0)

-

5.6

(5.6)

  Total Utility

-

(1.5)

1.5

-

(7.6)

7.6

EWC

Non-fuel O&M

(6.2)

(19.1)

12.9

(17.0)

(46.8)

29.8

Taxes other than income taxes

(0.5)

(1.4)

0.9

(0.3)

(3.6)

3.3

Asset write-off and impairments

(394.0)

(0.6)

(393.4)

(2,036.2)

(107.5)

(1,928.7)

Gain on sale of asset

154.0

-

154.0

154.0

-

154.0

Miscellaneous net (other income)

(36.8)

-

(36.8)

(36.8)

-

(36.8)

Income taxes - other

100.4

7.4

93.0

683.8

56.1

627.7

  Total EWC

(183.0)

(13.7)

(169.3)

(1,252.4)

(101.8)

(1,150.6)

Total Special Items

(183.0)

(15.2)

(167.8)

(1,252.4)

(109.4)

(1,143.0)

Totals may not foot due to rounding

B: Variance Analysis  Appendix B-1 and Appendix B-2 provide details of current quarter and year-to-date 2015 versus 2014 as-reported and operational earnings variance analysis for Utility, EWC, Parent & Other and Consolidated.

Appendix B-1: As-Reported and Operational EPS Variance Analysis

Fourth Quarter 2015 vs. 2014

(After-tax, per share in $, sorted in consolidated operational column, most to least favorable)

Utility

Parent & Other

EWC

Consolidated

As-Reported

Opera-tional

As-Reported

Opera-tional

As- Reported

Opera-tional

As- Reported

Opera-tional

2014 earnings

0.60

0.61

(0.25)

(0.25)

0.31

0.39

0.66

0.75

Income taxes - other

1.96

1.96

(a)

(0.04)

(0.04)

0.14

0.14

(b)

2.06

2.06

Non-fuel O&M

(0.01)

(0.02)

-

-

0.13

0.08

(c)

0.12

0.06

Share effect

0.03

0.03

(0.01)

(0.01)

-

-

0.02

0.02

Gain on sale of asset

-

-

-

-

0.56

-

(d)

0.56

-

Interest expense and other charges

0.01

0.01

-

-

(0.01)

(0.01)

-

-

Decommissioning expense

(0.01)

(0.01)

-

-

-

-

(0.01)

(0.01)

Depreciation/amortization expense

(0.05)

(0.05)

(e)

-

-

0.04

0.04

(0.01)

(0.01)

Taxes other than income taxes

(0.05)

(0.05)

(f)

-

-

0.02

0.01

(0.03)

(0.04)

Other income (deductions)-other

(0.02)

(0.02)

(0.03)

(0.03)

(0.14)

(0.01)

(g)

(0.19)

(0.06)

Asset write-offs and impairments

(0.19)

(0.19)

(h)

-

-

(1.43)

-

(i)

(1.62)

(0.19)

Net revenue

(0.52)

(0.52)

(j)

-

-

(0.48)

(0.48)

(k)

(1.00)

(1.00)

2015 earnings

1.75

1.75

(0.33)

(0.33)

(0.86)

0.16

0.56

1.58

 

Appendix B-2: As-Reported and Operational EPS Variance Analysis

Year-to-Date 2015 vs. 2014

(After-tax, per share in $, sorted in consolidated operational column, most to least favorable)

Utility

Parent & Other

EWC

Consolidated

As-Reported

Opera-tional

As-Reported

Opera-tional

As- Reported

Opera-tional

As- Reported

Opera-tional

2014 earnings

4.60

4.64

(1.00)

(1.00)

1.62

2.19

5.22

5.83

Income taxes - other

2.08

2.08

(a)

(0.07)

(0.07)

(l)

0.11

0.11

(b)

2.12

2.12

Asset write-offs and impairments

0.04

0.04

-

-

(6.97)

-

(i)

(6.93)

0.04

Other income (deductions) - other

0.01

0.01

(0.09)

(0.09)

(m)

(0.02)

0.11

(g)

(0.10)

0.03

Share effect

0.03

0.03

-

-

-

-

0.03

0.03

Gain on sale of asset

-

-

-

-

0.56

-

(d)

0.56

-

Decommissioning expense

(0.04)

(0.04)

-

-

0.01

0.01

(0.03)

(0.03)

Taxes other than income taxes

(0.12)

(0.12)

(f)

-

-

0.07

0.06

(n)

(0.05)

(0.06)

Depreciation/amortization expense

(0.19)

(0.19)

(e)

0.01

0.01

0.12

0.12

(o)

(0.06)

(0.06)

Interest expense and other charges

(0.04)

(0.04)

0.02

0.02

(0.04)

(0.04)

(0.06)

(0.06)

Non-fuel O&M

(0.57)

(0.61)

(p)

(0.01)

(0.01)

0.48

0.37

(c)

(0.10)

(0.25)

Net revenue

0.32

0.32

(j)

(0.01)

(0.01)

(1.90)

(1.90)

(k)

(1.59)

(1.59)

2015 earnings

6.12

6.12

(1.15)

(1.15)

(5.96)

1.03

(0.99)

6.00

See appendix in the webcast slide presentation for more details on the effects of the VY closure on EWC line item variances.

(a) 

The current quarter and year-to-date increases were due primarily to the income tax item of approximately $334 million resulting from the ELL business combination; this was partly offset by customer sharing recorded as a regulatory charge (included in net revenue in (j)). An audit settlement in Mississippi of $15 million also contributed to the increases. The year-to-date increase also reflected a first quarter 2015 adjustment of $24 million involving the reversal of a portion of the provision for uncertain tax provisions related to interest accrual. Partially offsetting was a state income tax item of $10 million in third quarter 2014.

(b) 

The increases in the current quarter and year-to-date periods were due largely to state tax effects from the 2015 settlement on the 2008/2009 audit.

(c) 

The current quarter and year-to-date increases were attributable to the closure of VY at the end of 2014.

(d) 

The as-reported increases in the current quarter and year-to-date periods reflect the gain on sale of the RISEC facility.

(e) 

The current quarter and year-to-date decreases were due primarily to additions to plant, including Ninemile 6 placed in service in December 2014, as well as higher depreciation rates implemented at EMI for 2015.

(f) 

The decreases in the current quarter and year-to-date periods were due partly to higher ad valorem taxes. In addition, fourth quarter 2014 results reflected the franchise tax settlement in Louisiana.

(g) 

The as-reported decrease in the current quarter was due largely to the asset impairment on EWC's 50% ownership interest in the Top Deer wind generation investment (accounted for under the equity method of accounting). The year-to-date operational increase was due primarily to higher realized gains on decommissioning trusts, including the rebalancing of VY's decommissioning trust portfolio.

(h) 

The current quarter decrease was driven by regulatory charges arising from the Waterford 3 replacement steam generator prudence review proceeding and the System Agreement termination settlement agreement. Partially offsetting was an earlier regulatory charge in 2014 for the Waterford 3 prudence review proceeding.

(i) 

The as-reported current quarter and year-to-date decreases reflected the fourth quarter 2015 non-cash impairment charges and related write-offs for the Palisades nuclear plant. The year-to date decrease also reflected third quarter 2015 impairment charges and related write-offs for the Pilgrim and FitzPatrick plants. Partially offsetting the year-to-date decrease was a third quarter 2014 charge for an updated VY decommissioning cost study.

(j) 

The current quarter decrease was attributable to the fourth quarter 2015 ELL business combination regulatory charge for customer sharing of $0.37 per share and the regulatory charge for the Waterford 3 prudence review proceeding of $0.09 per share (a portion of which is reflected in asset impairment in (h)). The effects of weather, which was milder-than-normal in the current quarter compared to colder-than-normal in fourth quarter 2014, also contributed. Weather for the full year was positive in both periods, but more favorable in 2015 compared to 2014. Annual net revenue was higher due to increased weather-adjusted sales volume and the Louisiana FRP rate adjustments for placing Ninemile 6 in rates and the EMI rate case.

(k) 

The current quarter and year-to-date decreases were largely due to the retirement of VY at the end of 2014 along with lower realized nuclear capacity and energy pricing on the operating plants.

(l) 

The decrease in the year-to-date period was primarily the result of a Louisiana tax law change effective July 1, 2015.

(m) 

The year-to-date decrease is due to the elimination of intersegment activity, primarily higher affiliate dividend income resulting from Hurricane Isaac Act 55 financing (offset at Utility).

(n) 

The increase year-to-date is attributable largely to lower VY property taxes due to the plant's closure in late 2014.

(o) 

The year-to-date increase was mainly attributable to the absence of VY depreciation. Lower depreciation expense resulting from the third quarter 2015 nuclear plant impairments also contributed.

(p) 

The year-to-date decrease reflected higher nuclear expenses, including regulatory compliance costs resulting from the NRC's decision to move ANO into Column 4 of the reactor oversight process action matrix ($53 million pre-tax). Pension and OPEB and distribution reliability expenses were also higher. Other non-fuel O&M changes with offsets in net revenue in the current and year-to date periods included transmission costs allocated by MISO and energy efficiency program costs.

C: Utility Financial and Performance Measures Appendix C-1 provides a comparative summary of Utility, Parent & Other Adjusted EPS, excluding the effects of special items and weather and normalizing tax items for the fourth quarter and full year periods. Appendix C-1 also provides Utility, Parent & Other Adjusted EPS excluding the effects of charges from resolving long outstanding regulatory matters.

Appendix C-1: Utility, Parent & Other Adjusted EPS - Reconciliation of GAAP to Non-GAAP Measures

Fourth Quarter and Year-to-Date 2015 vs. 2014 (See Appendix A for details on special items)

(per share in $)

Fourth Quarter

Year-to-Date

2015

2014

Change

2015

2014

Change

As-Reported Earnings

1.42

0.35

1.07

4.97

3.60

1.37

Less:

  Special Items

-

(0.01)

0.01

-

(0.04)

0.04

  Weather

(0.03)

0.05

(0.08)

0.19

0.07

0.12

  Tax Items, net of customer sharing

1.57

0.03

1.54

1.70

0.09

1.61

Adjusted Earnings (Loss)

(0.12)

0.28

(0.40)

3.08

3.48

(0.40)

Less: Regulatory Charges

(0.35)

(0.05)

(0.30)

(0.35)

(0.28)

(0.07)

Adjusted Earnings, excluding Regulatory Charges (q)

0.23

0.33

(0.10)

3.43

3.76

(0.33)

(q) 

Reflects charges for System Agreement termination settlement agreement (fourth quarter and year-to-date 2015), the Waterford 3 replacement steam generator prudence review proceeding (fourth quarter and year-to-date 2014 and fourth quarter and year-to-date 2015) and the EMI rate case settlement (2014), accounted for on multiple income statement line items.

Appendix C-2 provides a comparative summary of Utility operational performance measures.

Appendix C-2: Utility Operational Performance Measures

Fourth Quarter and Year-to-Date 2015 vs. 2014 (See Appendix G for reconciliation of GAAP to non-GAAP measures)

Fourth Quarter

Year-to-Date

2015

2014

% Change

% Weather Adjusted (r)

2015

2014

% Change

GWh billed

Residential

7,385

7,770

(4.9)

1.6

36,068

35,932

0.4

Commercial

6,979

6,984

(0.1)

(0.1)

29,348

28,827

1.8

Governmental

627

599

4.7

4.2

2,514

2,428

3.5

Industrial

11,152

11,087

0.6

0.6

44,382

43,723

1.5

Total Retail Sales

26,143

26,440

(1.1)

0.8

112,312

110,910

1.3

Wholesale

1,739

3,105

(44.0)

9,274

9,462

(2.0)

Total Sales

27,882

29,545

(5.6)

121,586

120,372

1.0

Weather-adjusted GWh billed (r)

Residential

35,413

35,188

0.6

Commercial

29,022

28,907

0.4

Governmental

2,509

2,430

3.2

Industrial

44,382

43,723

1.5

Total Retail Sales

111,326

110,248

1.0

Number of electric retail customers

Residential

2,431,984

2,409,732

0.9

Commercial

348,840

345,008

1.1

Governmental

17,899

17,373

3.0

Industrial

46,572

46,177

0.9

Total Retail Customers

2,845,295

2,818,290

1.0

Net Revenue ($ millions)

1,181

1,334

(11.5)

5,829

5,735

1.6

As-reported non-fuel O&M per MWh

$24.05

$22.57

6.6

$21.06

$19.89

5.9

Operational non-fuel O&M per MWh

$24.05

$22.48

7.0

$21.06

$19.79

6.4

(r) 

The effects of weather are estimated using monthly heating degree days and cooling degree days from certain locations within each jurisdiction and comparing to "normal" weather based on 20 year historical data. The models used to estimate weather are updated periodically and subject to change.

See appendix in the webcast slide presentation for information on select regulatory cases.

D: EWC Performance Measures Appendix D-1 provides a comparative summary of EWC operational performance measures.

Appendix D-1: EWC Operational Performance Measures

Fourth Quarter and Year-to-Date 2015 vs. 2014 (See Appendix G for reconciliation of GAAP to non-GAAP measures)

Fourth Quarter

Year-to-Date

2015

2014

% Change

2015

2014

% Change

Owned capacity (MW) (s)

4,880

6,068

(19.6)

4,880

6,068

(19.6)

GWh billed

10,135

11,550

(12.3)

39,745

44,424

(10.5)

As-reported average total revenue per MWh

$45.21

$54.00

(16.3)

$51.88

$61.21

(15.2)

Adjusted average total revenue per MWh (t)

$44.83

$53.64

(16.4)

$51.49

$60.84

(15.4)

Net revenue ($ millions)

379

521

(27.3)

1,666

2,224

(25.1)

As-reported non-fuel O&M per MWh

$27.67

$27.44

0.8

$25.99

$26.39

(1.5)

Operational non-fuel O&M per MWh (u)

$27.06

$25.78

5.0

$25.57

$25.34

0.9

EWC Nuclear Fleet

Capacity factor

94%

95%

(1.1)

91%

91%

-

GWh billed

9,561

10,635

(10.1)

35,859

40,253

(10.9)

As-reported average total revenue per MWh

$44.71

$53.56

(16.5)

$51.49

$60.76

(15.3)

Adjusted average total revenue per MWh (v)

$44.31

$53.17

(16.7)

$51.07

$60.35

(15.4)

Production cost per MWh

$22.63

$26.18

(13.6)

$25.30

$26.44

(4.3)

Net revenue ($ millions)

371

506

(26.7)

1,613

2,166

(25.5)

Refueling outage days

  FitzPatrick

-

7

-

44

  Indian Point 2

-

-

-

24

  Indian Point 3

-

-

23

-

  Palisades

19

-

32

56

  Pilgrim

-

-

34

-

(s)

Fourth quarter and year-to-date 2015 exclude VY (605 MW) that was shut down in December 2014 and RISEC (583 MW) that was sold in December 2015.

(t) 

Excluding VY, $54.26/MWh and $60.65/MWh in fourth quarter and year-to-date 2014 periods, respectively.

(u) 

Excluding VY, $25.45/MWh and $24.80/MWh in fourth quarter and year-to-date 2014 periods, respectively.

(v) 

Excluding VY, $53.79/MWh and $60.07/MWh in fourth quarter and year-to-date 2014 periods, respectively.

See appendix in the webcast slide presentation for EWC hedging and price disclosures.

E: Financial Performance Measures Appendix E provides comparative financial performance measures for the current quarter. Financial performance measures in this table include those calculated and presented in accordance with GAAP, as well as those that are considered non-GAAP measures.

As-reported measures are computed in accordance with GAAP as they include all components of net income, including special items. Operational measures are non-GAAP measures as they are calculated using operational net income, which excludes the impact of special items.

Appendix E: GAAP and Non-GAAP Financial Performance Measures

Fourth Quarter 2015 vs. 2014 (See Appendix G for reconciliation of GAAP to non-GAAP measures)

For 12 months ending Dec. 31

2015

2014

Change

GAAP Measures

ROIC - as-reported

1.0%

5.6%

(4.6%)

ROE - as-reported

(1.8%)

9.6%

(11.4%)

Book value per share

$51.89

$55.83

($3.94)

End of period shares outstanding (millions)

178.4

179.2

(0.8)

Non-GAAP Measures

ROIC - operational

6.3%

6.1%

0.2%

ROE - operational

11.2%

10.7%

0.5%

As of Dec. 31 ($ in millions)

2015

2014

Change

GAAP Measures

Cash and cash equivalents

1,351

1,422

(71)

Revolver capacity

3,582

3,592

(10)

Commercial paper outstanding

422

484

(62)

Total debt

13,850

13,917

(67)

Securitization debt

775

777

(2)

Debt to capital ratio

59.1%

57.4%

1.7%

Off-balance sheet liabilities:

Debt of joint ventures - Entergy's share

77

81

(4)

Leases - Entergy's share

359

422

(63)

Power purchase agreements accounted for as leases

195

224

(29)

Total off-balance sheet liabilities

631

727

(96)

Non-GAAP Measures

Debt to capital ratio, excluding securitization debt

57.7%

56.0%

1.7%

Gross liquidity

4,933

5,014

(81)

Net debt to net capital ratio, excluding securitization debt

55.0%

53.2%

1.8%

Parent debt to total debt ratio, excluding securitization debt

21.9%

20.4%

1.5%

Debt to operational adjusted EBITDA, excluding securitization debt

4.1

3.7

0.4

Operational FFO to debt ratio, excluding securitization debt

25.7%

27.8%

(2.1%)

F: Definitions, Abbreviations and Acronyms Appendix F-1 provides definitions of certain operational performance measures, as well as GAAP and non-GAAP financial measures which are referenced in the quarterly and full year materials. Non-GAAP measures are included in these materials to provide metrics that remove the effect of financial events that are not routine from commonly used financial metrics.

Appendix F-1: Definitions

Utility Operational Performance Measures

GWh billed

Total number of GWh billed to all retail and wholesale customers

Net revenue

Operating revenue less fuel, fuel related expenses and gas purchased for resale, purchased power and other regulatory charges (credits) - net

Non-fuel O&M

Operation and maintenance expenses excluding fuel, fuel-related expenses and gas purchased for resale and purchased power

Non-fuel O&M per MWh

Non-fuel O&M per MWh of billed sales

Number of retail customers

Number of customers at end of period

EWC Operational Performance Measures

As-reported average total revenue per MWh

As-reported revenue per MWh billed, excluding revenue from investments in wind generation accounted for under the equity method of accounting

Adjusted average total revenue per MWh

As-reported average total revenue per MWh, excluding revenue from the amortization of the Palisades below-market PPA

Average revenue under contract per kW per month (applies to capacity contracts only)

Revenue on a per unit basis at which capacity is expected to be sold to third parties, given existing contract prices and/or auction awards

Average revenue per MWh on contracted volumes

Revenue on a per unit basis at which generation output reflected in contracts is expected to be sold to third parties (including offsetting positions) at the minimum contract prices and at forward market prices at a point in time, given existing contract or option exercise prices based on expected dispatch or capacity, excluding the revenue associated with the amortization of the below-market PPA for Palisades; revenue will fluctuate due to factors including market price changes affecting revenue received on puts, collars and call options, positive or negative basis differentials, option premiums and market prices at the time of option expiration, costs to convert firm LD to unit-contingent and other risk management costs

Bundled capacity and energy contracts

A contract for the sale of installed capacity and related energy, priced per MWh sold

Capacity contracts

A contract for the sale of the installed capacity product in regional markets managed by ISO-NE, the NYISO and MISO

Capacity factor

Normalized percentage of the period that the nuclear plants generate power

Expected sold and market total revenue per MWh

Total energy and capacity revenue on a per unit basis at which total planned generation output and capacity is expected to be sold given contract terms and market prices at a point in time, including estimates for market price changes affecting revenue received on puts, collars and call options, positive or negative basis differentials, option premiums and market prices at time of option expiration, costs to convert Firm LD to unit-contingent and other risk management costs, divided by total planned MWh of generation, excluding the revenue associated with the amortization of the Palisades below-market PPA

Firm LD

Transaction that requires receipt or delivery of energy at a specified delivery point (usually at a market hub not associated with a specific asset) or settles financially on notional quantities; if a party fails to deliver or receive energy, defaulting party must compensate the other party as specified in the contract; a portion of which may be capped through the use of risk management products

GWh billed

Total number of GWh billed to customers, excluding investments in wind generation accounted for under the equity method of accounting and financially-settled instruments

 

Appendix F-1: Definitions

EWC Operational Performance Measures (continued)

Net revenue

Operating revenue less fuel, fuel related expenses and purchased power

Non-fuel O&M

Operation and maintenance expenses excluding fuel, fuel-related expenses and gas purchased for resale, purchased power and investments in wind generation accounted for under the equity method of accounting

Non-fuel O&M per MWh

Non-fuel O&M per MWh billed

Offsetting positions

Transactions for the purchase of energy, generally to offset a Firm LD transaction

Owned capacity (MW)

Installed capacity owned and operated by EWC, including investments in wind generation accounted for under the equity method of accounting; VY (nuclear) was retired on Dec. 29, 2014, and RISEC (non-nuclear) was sold on Dec. 17, 2015

Percent of capacity sold forward

Percent of planned qualified capacity sold to mitigate price uncertainty under physical or financial transactions

Percent of planned generation under contract

Percent of planned generation output sold or purchased forward under contracts, forward physical contracts, forward financial contracts or options that mitigate price uncertainty that may or may not require regulatory approval or approval of transmission rights or other conditions precedent; positions that are no longer classified as hedges are netted in the planned generation under contract

Planned net MW in operation

Amount of installed capacity to generate power and/or sell capacity, assuming shutdown of Pilgrim June 1, 2019 and FitzPatrick planned for Jan. 27, 2017

Planned TWh of generation

Amount of output expected to be generated by EWC resources considering plant operating characteristics and outage schedules, assuming shutdown of Pilgrim June 1, 2019 and FitzPatrick planned for Jan. 27, 2017, uninterrupted normal plant operation and timely renewal of plant operating licenses at IPEC

Production cost per MWh

Fuel and non-fuel O&M expenses according to accounting standards that directly relate to the production of electricity per MWh (based on net generation), excluding special items

Refueling outage days

Number of days lost for scheduled refueling outage during the period

Unit-contingent

Transaction under which power is supplied from a specific generation asset; if the asset is on operational outage, seller is generally not liable to buyer for any damages, unless the contract specifies certain conditions such as an availability guarantee

Financial Measures – GAAP

Book value per share

End of period common equity divided by end of period shares outstanding

Debt of joint ventures - Entergy's share

Entergy's share of debt issued by business joint ventures at EWC

Debt to capital ratio

Total debt divided by total capitalization

Leases - Entergy's share

Operating leases held by subsidiaries capitalized at implicit interest rate

Revolver capacity

Amount of undrawn capacity remaining on corporate and subsidiary revolvers, including Entergy Nuclear Vermont Yankee

ROIC - as-reported

12-months rolling net income attributable to Entergy Corporation or Subsidiary (Net Income) adjusted for preferred dividends and tax-effected interest expense divided by average invested capital

ROE - as-reported

12-months rolling Net Income divided by average common equity

Securitization debt

Debt associated with securitization bonds issued to recover storm costs from hurricanes Rita, Ike and Gustav at ETI and Hurricane Isaac at ENOI; the 2009 ice storm at EAI and investment recovery of costs associated with the cancelled Little Gypsy repowering project at ELL

Total debt

Sum of short-term and long-term debt, notes payable and commercial paper and capital leases on the balance sheet

 

Appendix F-1: Definitions

Financial Measures - Non-GAAP

Adjusted EBITDA

Earnings before interest, depreciation and amortization and income taxes excluding decommissioning expense and other than temporary impairment losses on decommissioning trust fund assets; for Entergy consolidated, also excludes AFUDC-equity funds and subtracts securitization proceeds

Adjusted EPS

As-reported earnings per share excluding special items and weather and normalizing for income tax

Debt to capital ratio, excluding securitization debt

Total debt divided by total capitalization, excluding securitization debt

Debt to EBITDA

End of period total debt excluding securitization debt divided by 12-months rolling operational adjusted EBITDA

FFO

Net cash flow provided by operations less AFUDC-borrowed funds, working capital items in operating cash flow (receivables, fuel inventory, accounts payable, prepaid taxes and taxes accrued, interest accrued and other working capital accounts) and securitization regulatory charge

FFO to debt

12-months rolling operational FFO as a percentage of end of period total debt excluding securitization debt

Gross liquidity

Sum of cash and revolver capacity

Operational adjusted EBITDA

Adjusted EBITDA excluding effects of special items

Operational earnings

As-reported Net Income adjusted to exclude the impact of special items

Operational FFO

FFO excluding effects of special items

Parent debt to total debt

End of period Entergy Corporation debt, including amounts drawn on credit revolver and commercial paper facilities, as a percent of total debt excluding securitization debt

Net debt to net capital ratio, excluding securitization debt

Total debt less cash and cash equivalents divided by total capitalization less cash and cash equivalents, excluding securitization debt

ROIC - operational

12-months rolling operational Net Income adjusted for preferred dividends and tax-effected interest expense divided by average invested capital

ROE - operational

12-months rolling operational Net Income divided by average common equity

Appendix F-2 explains abbreviations and acronyms used in the quarterly earnings materials.

Appendix F-2: Abbreviations and Acronyms

AFUDC-

borrowed funds

Allowance for borrowed funds used during construction

LPSC

Louisiana Public Service Commission

LTM

Last twelve months

MISO

Midcontinent Independent System Operator, Inc.

AFUDC-

equity funds

Allowance for equity funds used during

   construction

MPSC

Mississippi Public Service Commission

NEPOOL

New England Power Pool

ADIT

Accumulated deferred income taxes

Ninemile 6

Ninemile Point Unit 6

ANO

Arkansas Nuclear One (nuclear)

NOAA

National Oceanic and Atmosphere Administration

APSC

Arkansas Public Service Commission

Non-fuel O&M

Non-fuel operation and maintenance expense

ARO

Asset retirement obligation

NRC

Nuclear Regulatory Commission

BP

Basis point

NYISO

New York Independent System Operator, Inc.

CCGT

Combined cycle gas turbine

NYPA

New York Power Authority

CCNO

Council of the City of New Orleans, Louisiana

NYS

New York State

COD

Commercial operation date

NYSDEC

New York State Department of Environmental Conservation

Cooper

Cooper Nuclear Station

NYSDOS

New York State Department of State

CT

Simple cycle combustion turbine

NYSE

New York Stock Exchange

CZM

Coastal zone management

O&M

Operation and maintenance expense

DCRF

Distribution cost recovery factor

OCF

Operating cash flow

DOJ

U.S. Department of Justice

OPEB

Other post-employment benefits

EAI

Entergy Arkansas, Inc.

Palisades

Palisades Power Plant (nuclear)

EBITDA

Earnings before interest, income taxes, depreciation and amortization

Pilgrim

Pilgrim Nuclear Power Station (nuclear)

EEI

Edison Electric Institute

EGSL

Entergy Gulf States Louisiana, L.L.C.

ELL

Entergy Louisiana, LLC

PPA

Power purchase agreement

EMI

Entergy Mississippi, Inc.

PUCT

Public Utility Commission of Texas

ENOI

Entergy New Orleans, Inc.

RFO

Refueling outage

ESI

Entergy Services, Inc.

RFP

Request for proposal

EPS

Earnings per share

RISEC

Rhode Island State Energy Center (CCGT)

ETI

Entergy Texas, Inc.

ROE

Return on equity

ETR

Entergy Corporation

ROIC

Return on invested capital

EWC

Entergy Wholesale Commodities

ROS

Rest of state

FCA

Forward capacity auction

RPCE

Rough production cost equalization

FERC

Federal Energy Regulatory Commission

SEC

U.S. Securities and Exchange Commission

FFO

Funds from operations

SEMARI

Southeast Massachusetts/Rhode Island

Firm LD

Firm liquidated damages

SERI

System Energy Resources, Inc.

FitzPatrick

James A. FitzPatrick Nuclear Power Plant

SPDES

State Pollutant Discharge Elimination System

FRP

Formula rate plan

SPP

Southwest Power Pool

GAAP

Generally accepted accounting principles

TCRF

Transmission cost recovery factor

Grand Gulf

Unit No. 1 of Grand Gulf Nuclear Station (nuclear), 90% owned or leased by System Energy

Top Deer

Top Deer Wind Ventures, LLC

HCM

Human Capital Management program

Union

Union Power Station

HSR

Hart-Scott-Rodino

UP&O

Utility, Parent & Other

Indian Point 2

Indian Point Energy Center Unit 2 (nuclear)

VY

Vermont Yankee Nuclear Power Station (nuclear)

Indian Point 3

Indian Point Energy Center Unit 3 (nuclear)

WACC

Weighted-average cost of capital

IPEC

Indian Point Energy Center (nuclear)

WOTAB

West of the Atchafalaya Basin

ISES

Independence Steam Electric Station (coal)

Waterford 3

Unit No. 3 (nuclear) of the Waterford Steam Electric Station, 100% owned or leased by Entergy Louisiana

ISO-NE

ISO New England

WQC

Water Quality Certification

LHV

Lower Hudson Valley

YOY

Year-over-year

G: GAAP to Non-GAAP Reconciliations Appendix G-1, Appendix G-2 and Appendix G-3 provide reconciliations of various non-GAAP financial measures disclosed in this release to their most comparable GAAP measure.

Appendix G-1: Reconciliation of GAAP to Non-GAAP Financial Measures - Utility and EWC Non-fuel O&M per MWh, EWC and EWC Nuclear Average Total Revenue per MWh

($ in thousands except where noted)

Fourth Quarter

Year-to-Date

2015

2014

2015

2014

Utility

As-reported Utility non-fuel O&M

(A)

670,638

666,742

2,560,620

2,394,621

Special Items included in non-fuel O&M:

  HCM implementation expenses

-

2,423

-

12,625

     Total special items included in non-fuel O&M

(B)

-

2,423

-

12,625

Operational Utility non-fuel O&M

(A-B)

670,638

664,319

2,560,620

2,381,996

Utility billed sales (GWh)

(C)

27,882

29,545

121,586

120,372

As-reported Utility non-fuel O&M per MWh

(A/C)

24.05

22.57

21.06

19.89

Operational Utility non-fuel O&M per MWh

[(A-B)/(C)]

24.05

22.48

21.06

19.79

EWC

As-reported EWC non-fuel O&M

(D)

280,425

316,917

1,033,144

1,172,339

Special Items included in non-fuel O&M:

 Decisions to close VY, FitzPatrick and Pilgrim

6,205

18,402

16,979

43,516

  HCM implementation expenses

-

736

-

3,261

     Total special items included in non-fuel O&M

(E)

6,205

19,138

16,979

46,777

Operational EWC non-fuel O&M

(D-E)

274,220

297,779

1,016,165

1,125,562

EWC billed sales (GWh)

(F)

10,135

11,550

39,745

44,424

As-reported EWC non-fuel O&M per MWh

(D/F)

27.67

27.44

25.99

26.39

Operational EWC non-fuel O&M per MWh

[(D-E)/(F)]

27.06

25.78

25.57

25.34

As-reported EWC operating revenue

(G)

458,184

623,652

2,061,827

2,719,404

Less Palisades below-market PPA amortization

(H)

3,800

4,124

15,200

16,496

Adjusted EWC operating revenue

(G-H)

454,384

619,528

2,046,627

2,702,908

As-reported EWC nuclear operating revenue

(I)

427,447

569,581

1,846,508

2,445,695

Less Palisades below-market PPA amortization

(H)

3,800

4,124

15,200

16,496

Adjusted EWC nuclear operating revenue

(I-H)

423,647

565,457

1,831,308

2,429,199

As-reported EWC average total revenue per MWh

(G)/(F)

45.21

54.00

51.88

61.21

Adjusted EWC average total revenue per MWh

[(G-H)/(F)]

44.83

53.64

51.49

60.84

EWC nuclear billed sales (GWh)

(J)

9,561

10,635

35,859

40,253

As-reported EWC nuclear average total revenue per MWh

(I)/(J)

44.71

53.56

51.49

60.76

Adjusted EWC nuclear average total revenue per MWh

[(I-H)/(J)]

44.31

53.17

51.07

60.35

VY operational non-fuel O&M

(K)

32,054

149,527

VY operating revenue

(L)

52,981

315,293

VY billed sales

(M)

1,108

5,061

Operational EWC non-fuel O&M per MWh excluding VY

[(D-E)-(K)]/[(F)-(M)]

25.45

24.80

Adjusted EWC average total revenue per MWh excluding VY

[(G-H)-(L)]/(F)-(M)]

54.26

60.65

Adjusted EWC nuclear average total revenue per MWh excluding VY

[(I-H)-(L)]/(J)-(M)]

53.79

60.07

Totals may not foot due to rounding

 

Appendix G-2: Reconciliation of GAAP to Non-GAAP Financial Measures - ROE, ROIC Metrics

($ in millions)     

Fourth Quarter

2015

2014

As-reported net income (loss) attributable to Entergy Corporation, rolling 12 months

(A)

(177)

941

Preferred dividends

20

20

Tax effected interest expense

396

386

As-reported net income attributable to Entergy Corporation, rolling 12 months adjusted for preferred dividends and tax effected interest expense

(B)

239

1,347

Special items in prior quarters

(1,070)

(95)

HCM implementation expenses

-

(2)

Decisions to close VY, FitzPatrick and Pilgrim

(3)

(13)

Palisades asset impairment and related write-offs

(256)

-

Top Deer investment impairment

(24)

-

Gain on the sale of RISEC

100

-

  Total special items, rolling 12 months

(C)

(1,253)

(109)

Operational earnings, rolling 12 months adjusted for preferred dividends and tax effected interest expense

(B-C)

1,492

1,456

Operational earnings, rolling 12 months

(A-C)

1,076

1,050

Average invested capital

(D)

23,827

23,864

Average common equity

(E)

9,632

9,820

ROIC - as-reported %

(B/D)

1.0

5.6

ROIC - operational %

[(B-C)/D]

6.3

6.1

ROE - as-reported %

(A/E)

(1.8)

9.6

ROE - operational %

[(A-C)/E]

11.2

10.7

Totals may not foot due to rounding

 

Appendix G-3: Reconciliation of GAAP to Non-GAAP Financial Measures - Credit and Liquidity Metrics

($ in millions)

Fourth Quarter

2015

2014

Total debt

(A)

13,850

13,917

Less securitization debt

(B)

775

777

Total debt, excluding securitization debt

(C)

13,075

13,140

Less cash and cash equivalents

(D)

1,351

1,422

  Net debt, excluding securitization debt

(E)

11,724

11,718

Total capitalization

(F)

23,425

24,229

Less securitization debt

(B)

775

777

Total capitalization, excluding securitization debt

(G)

22,650

23,452

Less cash and cash equivalents

(D)

1,351

1,422

Net capital, excluding securitization debt

(H)

21,299

22,030

Debt to capital ratio %

(A/F)

59.1

57.4

Debt to capital ratio, excluding securitization debt %

(C/G)

57.7

56.0

Net debt to net capital ratio, excluding securitization debt %

(E/H)

55.0

53.2

Revolver capacity

(I)

3,582

3,592

Gross liquidity

(D+I)

4,933

5,014

Entergy Corporation notes:

  Due September 2015

-

550

  Due January 2017

500

500

  Due September 2020

450

450

  Due July 2022

650

-

    Total parent long-term debt

(J)

1,600

1,500

Revolver draw

(K)

835

695

Commercial paper

(L)

422

484

Total parent debt

(J)+(K)+(L)

2,857

2,679

Parent debt to total debt ratio, excluding securitization debt %

[((J)+(K)+(L))/(C)]

21.9%

20.4%

 

Appendix G-3: Reconciliation of GAAP to Non-GAAP Financial Measures - Credit and Liquidity Metrics (continued)

($ in millions)

Fourth Quarter

2015

2014

Total debt

(A)

13,850

13,917

Less securitization debt

(B)

775

777

Total debt, excluding securitization debt

(C)

13,075

13,140

As-reported consolidated net income (loss), rolling 12 months

(157)

960

Add back: interest expense, rolling 12 months

643

628

Add back: income tax expense, rolling 12 months

(643)

590

Add back: depreciation and amortization, rolling 12 months

1,337

1,319

Add back: regulatory charges (credits), rolling 12 months

175

(14)

Subtract: securitization proceeds, rolling 12 months

137

130

Subtract: interest and investment income, rolling 12 months

187

148

Subtract: AFUDC-equity funds, rolling 12 months

52

65

Add back: decommissioning expense, rolling 12 months

280

273

  Adjusted EBITDA, rolling 12 months

(D)

1,259

3,413

Add back: special item for HCM implementation expenses, rolling 12 months (pre-tax)

-

16

Add back: special item resulting from decisions to close VY, FitzPatrick and Pilgrim, rolling 12 months (pre-tax)

1,658

154

Add back: special item for Palisades asset impairment and related write-offs, rolling 12 months (pre-tax)

396

-

Add back: Top Deer investment impairment, rolling 12 months (pre-tax)

37

-

Add back: special item for gain on the sale of RISEC, rolling 12 months (pre-tax)

(154)

-

  Operational adjusted EBITDA, rolling 12 months

(E)

3,196

3,583

Debt to operational adjusted EBITDA, excluding securitization debt

(C)/(E)

4.1

3.7

Net cash flow provided by operating activities, rolling 12 months

(F)

3,291

3,890

AFUDC-borrowed funds used during construction, rolling 12 months

(G)

(27)

(34)

Working capital items in net cash flow provided by operating activities, rolling 12 months:

  Receivables

38

98

  Fuel inventory

(12)

4

  Accounts payable

(135)

(13)

  Prepaid taxes and taxes accrued

82

(63)

  Interest accrued

(11)

25

  Other working capital accounts

(114)

112

  Securitization regulatory charge

107

97

       Total

(H)

(45)

260

FFO, rolling 12 months

(F)+(G)-(H)

3,309

3,596

Add back: special item for HCM implementation expenses, rolling 12 months (pre-tax)

-

51

Add back: special item resulting from decisions to close VY, FitzPatrick and Pilgrim, rolling 12 months (pre-tax)

55

7

Operational FFO, rolling 12 months

(I)

3,364

3,654

Operational FFO to debt ratio, excluding securitization debt %

(I)/(C)

25.7%

27.8%

Totals may not foot due to rounding

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SOURCE Entergy Corporation



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