NEW ORLEANS, April 25, 2018 /PRNewswire/ -- Entergy Corporation (NYSE: ETR) reported first quarter 2018 earnings per share of 73 cents on an as-reported basis and $1.16 on an operational basis. These results reflect the lower federal income tax rate, favorable weather of 9 cents and a loss of (4) cents from the implementation of ASU No. 2016-01, which now requires the mark-to-market of equity investments in the nuclear decommissioning trust funds at EWC.
"We've had a solid start to 2018 with success on key projects and regulatory initiatives," said Entergy Chairman and Chief Executive Officer Leo Denault. "Our results keep us on track to achieve our full year guidance and long-term outlooks."
Business highlights included the following:
- Entergy New Orleans received approval for the New Orleans Power Station.
- The LPSC approved Entergy Louisiana's unopposed settlement for its formula rate plan.
- Entergy Mississippi made its annual formula rate plan filing.
- Entergy and parties filed a settlement memorandum of understanding with the Vermont PUC for the sale of Vermont Yankee.
- Indian Point 2 completed its final refueling and maintenance outage before retirement.
- Entergy was named for a third consecutive year by the Women's Business Enterprise National Council to the list of America's Top Corporations for Women's Business Enterprise, honoring corporations that have implemented world-class policies and programs to enable growth and reduce barriers for women-owned businesses.
Consolidated Earnings (GAAP and Non-GAAP Measures) First Quarter 2018 vs. 2017 (See Appendix A for reconciliation of GAAP to non-GAAP measures and description of special items) |
|||
First Quarter |
|||
2018 |
2017 |
Change |
|
(After-tax, $ in millions) |
|||
As-reported earnings |
133 |
83 |
50 |
Less special items |
(78) |
(95) |
17 |
Operational earnings (non-GAAP) |
211 |
178 |
33 |
Estimated weather in billed sales |
16 |
(29) |
46 |
(After-tax, per share in $) |
|||
As-reported earnings |
0.73 |
0.46 |
0.27 |
Less special items |
(0.43) |
(0.53) |
0.10 |
Operational earnings (non-GAAP) |
1.16 |
0.99 |
0.17 |
Estimated weather in billed sales |
0.09 |
(0.16) |
0.25 |
Calculations may differ due to rounding |
Consolidated Results
For first quarter 2018, the company reported earnings of $133 million, or 73 cents per share, on an as-reported basis and earnings of $211 million, or $1.16 per share, on an operational basis. This compared to first quarter 2017 earnings of $83 million, or 46 cents per share, on an as-reported basis and earnings of $178 million, or 99 cents per share on an operational basis.
Summary discussions by business are below. Additional details, including information on OCF by business, are provided in Appendix A and a comprehensive analysis of quarterly variances by business is provided in Appendix B.
Utility, Parent & Other Results
For first quarter 2018, the Utility business reported earnings attributable to Entergy Corporation of $215 million, or $1.19 per share, compared to $165 million, or 92 cents per share, in first quarter 2017. Key drivers for the quarterly increase included higher net revenue and lower income tax expense, partially offset by higher operating expenses.
Net revenue increased quarter-over-quarter driven by favorable weather in first quarter 2018 compared to unfavorable weather a year ago. Weather-adjusted sales growth was positive, but was more than offset by lower volume in the unbilled period. Rate actions to recover investments that benefit customers were also more than offset by regulatory provisions recorded to return benefits from tax reform to customers at Entergy Louisiana and Entergy New Orleans.
On a weather-adjusted basis, billed sales increased 3.0 percent, including 4.1 percent and 2.4 percent for residential and commercial billed sales, respectively. Industrial billed sales volume increased 2.6 percent with higher sales to both new and expansion customers as well as existing customers. The increase was driven largely by the primary metals segment. Sales to petroleum refining customers were also higher.
Income tax expense was lower due primarily to the reduction of the federal income tax rate. Utility non-fuel O&M increased quarter-over-quarter, driven by higher spending on nuclear operations, primarily labor, and taxes other than income taxes.
For first quarter 2018, Parent & Other reported a loss of $(64 million), or (36) cents per share, compared to a loss of $(54 million), or (30) cents per share, in first quarter 2017.
On a combined basis, Utility, Parent & Other (non-GAAP) contributed 83 cents to first quarter 2018 consolidated EPS compared to 62 cents to first quarter 2017 consolidated EPS. On an adjusted basis, excluding special items and normalizing weather and income taxes, Utility, Parent & Other contributed 71 cents in first quarter 2018 to consolidated EPS, compared to 83 cents in first quarter 2017.
Appendix C contains additional details on Utility financial and operating measures, including a reconciliation for non-GAAP Utility, Parent & Other adjusted earnings and EPS.
Entergy Wholesale Commodities Results
For first quarter 2018, EWC recorded a loss attributable to Entergy Corporation of $(18 million), or (10) cents per share, on an as-reported basis and earned $60 million, or 33 cents per share, on an operational basis. This compared to a first quarter 2017 loss of $(28 million), or (16) cents per share, on an as-reported basis and earnings of $67 million, or 37 cents per share, on an operational basis.
As-reported losses in both periods reflected impairments and other expenses recorded as a result of strategic decisions for the wholesale business. These items were considered special items and excluded from operational earnings.
The sale of FitzPatrick at the end of first quarter 2017 affected period-over-period variances for multiple line items. Excluding FitzPatrick, quarterly earnings reflected lower other income, primarily due to losses on decommissioning trust funds previously classified as other comprehensive income on the balance sheet, now recorded to the income statement. The decrease was partially offset by lower income tax expense which resulted primarily from the reduction of the federal income tax rate.
Appendix D contains additional details on EWC financial and operating measures, including reconciliation for non-GAAP EWC operational adjusted EBITDA.
Earnings Guidance
Entergy affirmed its 2018 consolidated operational earnings guidance range of $6.25 to $6.85 per share and its Utility, Parent & Other adjusted guidance range of $4.50 to $4.90 per share. See webcast presentation slides for additional details, including Progress Against Guidance on slide 35.
The company has provided 2018 earnings guidance with regard to the non-GAAP measures of consolidated operational EPS and Utility, Parent & Other adjusted EPS. These measures exclude from the corresponding GAAP financial measures the effect of special items as described below under "Non-GAAP Financial Measures." The company has not provided a reconciliation of such non-GAAP guidance to guidance presented on a GAAP basis because it cannot predict and quantify with a reasonable degree of confidence all of the special items that may occur during 2018. The only anticipated special items that the company can reasonably estimate at this time are those that relate to the decisions to sell or close the company's merchant nuclear plants; these estimated costs, which are excluded from the earnings guidance, are expected to decrease as-reported EPS by approximately $(2.55) per share in 2018.
Earnings Teleconference
A teleconference will be held at 10:00 a.m. Central Time on Wednesday, April 25, 2018, to discuss Entergy's quarterly 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 844-309-6569, conference ID 9178845, 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 May 2, 2018, by dialing 855-859-2056, conference ID 9178845. 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 9,000 megawatts of nuclear power. Entergy delivers electricity to 2.9 million utility customers in Arkansas, Louisiana, Mississippi and Texas. Entergy has annual revenues of approximately $11 billion and more than 13,000 employees.
Entergy Corporation's common stock is listed on the New York and Chicago stock exchanges under the symbol "ETR."
Details regarding Entergy's results of operations, regulatory proceedings and other matters are available in this earnings release, a copy of which will be filed with the SEC, and the webcast slide presentation. Both documents 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.
Entergy maintains a web page as part of its Investor Relations website, entitled "Regulatory and Other Information," which provides investors with key updates of regulatory proceedings and important milestones on the execution of its strategy. While some of this information may be considered material information, investors should not rely exclusively on this page for all relevant company information.
For definitions of certain operating measures, as well as GAAP and non-GAAP financial measures and abbreviations and acronyms used in the earnings release materials, see Appendix F.
Non-GAAP Financial Measures
This news release contains non-GAAP financial measures. Generally, a non-GAAP financial measure is a numerical measure of a company's performance, financial position, or cash flows that either excludes or includes amounts that are not normally excluded or included in the most directly comparable measure calculated and presented in accordance with GAAP. Entergy has provided quantitative reconciliations within this release of the non-GAAP financial measures to the most directly comparable GAAP financial measures.
Certain non-GAAP financial measures in this news release could differ from GAAP only in that the figure or ratio states or includes operational earnings. Operational earnings are not calculated in accordance with GAAP because they exclude the effect of "special items." Special items are unusual or non-recurring items or events or other items or events that management believes do not reflect the ongoing business of Entergy, and may include items such as impairments, gains or losses on asset sales, and other gains or losses occurring as a result of strategic decisions such as Entergy's decisions to shut down or sell its merchant nuclear plants. In addition, other financial measures including net income (or earnings), adjusted for preferred dividends and tax effected interest expense; net revenue; return on average invested capital; and return on average common equity are included on both an operational and as-reported basis. In each case, the metrics defined as "operational" would exclude the effect of special items as defined above.
Entergy reports the combination of the Utility segment with Parent & Other as Utility, Parent & Other, which is all of Entergy excluding the EWC segment, since management uses this combination in making decisions about its ongoing business in light of its decision to exit the merchant power business. Entergy also reports Utility, Parent & Other adjusted earnings, which combines the Utility segment with Parent & Other, excludes applicable special items and normalizes weather and income tax expense for the periods presented, because it believes that these financial metrics provide useful information to investors in evaluating the ongoing results of Entergy's businesses and assist investors in comparing Entergy's financial performance to the financial performance of other companies in the Utility sector. The methodologies employed to determine the normalized weather and income tax expense adjustments, each of which is further described in this release, involve estimations and the judgement of management.
In addition to reporting earnings per share on a consolidated basis, Entergy reports on a per share basis the earnings or loss of each of its segments, together with the combination of the Utility segment and Parent & Other. These per share measures represent the net income or loss of such segment or segments divided by the diluted average number of shares of common stock outstanding for the period. Entergy believes such per share measures provide useful information to investors in understanding the results of operations of those businesses and their contribution to Entergy's consolidated results of operations.
Other non-GAAP measures, including adjusted EBITDA; operational adjusted EBITDA; gross liquidity; debt to capital ratio, excluding securitization debt; net debt to net capital ratio, excluding securitization debt; parent debt to total debt ratio, excluding securitization debt; debt to operational adjusted EBITDA ratio, excluding securitization debt; and operational FFO to debt ratio, excluding securitization debt are measures Entergy uses internally for management and board discussions and cash budgeting and performance monitoring activities to gauge the overall strength of its business. Entergy believes the above data provides useful information to investors in evaluating Entergy's ongoing financial results and flexibility and assists investors in comparing Entergy's credit and liquidity to the credit and liquidity of others in the Utility sector.
The non-GAAP financial measures and other reported adjusted items in this release are presented in addition to, and in conjunction with, results presented in accordance with GAAP. These non-GAAP financial measures should not be used to the exclusion of GAAP financial measures. These non-GAAP financial measures reflect an additional way of viewing aspects of Entergy's operations that, when viewed with Entergy's GAAP results and the accompanying reconciliations to corresponding GAAP financial measures, provide a more complete understanding of factors and trends affecting Entergy's business. Investors are strongly encouraged to review Entergy's consolidated financial statements and publicly filed reports in their entirety and to not rely on any single financial measure. Non-GAAP financial measures are not standardized; therefore, it might not be possible to compare these financial measures with other companies' non-GAAP financial measures having the same or similar names.
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 2018 earnings guidance; its current financial and operational outlook; and other statements of Entergy's plans, beliefs or expectations included in this news release. Readers are cautioned not to place undue reliance on these forward-looking statements, which apply only as of the date of 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 (1) rate proceedings, formula rate plans and other cost recovery mechanisms, including the risk that costs may not be recoverable to the extent anticipated by the utilities and (2) implementation of the ratemaking effects of changes in law; (c) uncertainties associated with efforts to remediate the effects of major storms and recover related restoration costs; (d) nuclear plant relicensing, operating and regulatory costs and 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 Entergy's 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 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; (h) effects of changes in federal, state or local laws and regulations and other governmental actions or policies, including changes in monetary, fiscal, tax, environmental or energy policies; and (i) the effects of technological changes and changes in commodity markets, capital markets or economic conditions, during the periods covered by the forward-looking statements.
First Quarter 2018 Earnings Release Appendices and Financial Statements
Appendices
Appendices are presented in this section as follows:
- A: Consolidated Results and Special Items
- B: Earnings Variance Analysis
- C: Utility Financial and Operating Measures
- D: EWC Financial and Operating Measures
- E: Consolidated Financial Measures
- F: Definitions and Abbreviations and Acronyms
- G: GAAP to Non-GAAP Reconciliations
A: Consolidated Results and Special Items
Appendix A-1 provides a comparative summary of consolidated earnings, including a reconciliation of as-reported earnings (GAAP) to operational earnings (non-GAAP).
Appendix A-1: Consolidated Earnings - Reconciliation of GAAP to Non-GAAP Measures First Quarter 2018 vs. 2017 (See Appendix A-3 and Appendix A-4 for details on special items) |
|||
First Quarter |
|||
2018 |
2017 |
Change |
|
(After-tax, $ in millions) |
|||
Earnings (loss) |
|||
Utility |
215 |
165 |
50 |
Parent & Other |
(64) |
(54) |
(10) |
EWC |
(18) |
(28) |
9 |
Consolidated |
133 |
83 |
50 |
Less special items |
|||
Utility |
- |
- |
- |
Parent & Other |
- |
- |
- |
EWC |
(78) |
(95) |
17 |
Consolidated |
(78) |
(95) |
17 |
Operational earnings (loss) (non-GAAP) |
|||
Utility |
215 |
165 |
50 |
Parent & Other |
(64) |
(54) |
(10) |
EWC |
60 |
67 |
(8) |
Consolidated |
211 |
178 |
33 |
Estimated weather in billed sales |
16 |
(29) |
46 |
Diluted average number of common shares outstanding (in millions) |
181.4 |
179.8 |
|
(After-tax, per share in $) (a) |
|||
Earnings (loss) |
|||
Utility |
1.19 |
0.92 |
0.27 |
Parent & Other |
(0.36) |
(0.30) |
(0.06) |
EWC |
(0.10) |
(0.16) |
0.06 |
Consolidated |
0.73 |
0.46 |
0.27 |
Less special items |
|||
Utility |
- |
- |
- |
Parent & Other |
- |
- |
- |
EWC |
(0.43) |
(0.53) |
0.10 |
Consolidated |
(0.43) |
(0.53) |
0.10 |
Operational earnings (loss) (non-GAAP) |
|||
Utility |
1.19 |
0.92 |
0.27 |
Parent & Other |
(0.36) |
(0.30) |
(0.06) |
EWC |
0.33 |
0.37 |
(0.04) |
Consolidated |
1.16 |
0.99 |
0.17 |
Estimated weather in billed sales |
0.09 |
(0.16) |
0.25 |
Calculations may differ due to rounding |
(a) |
Per share amounts are calculated by dividing the corresponding earnings (loss) by the diluted average number of common shares outstanding for the period. |
See Appendix B for detailed earnings variance analysis. See Appendix A-3 for special items by driver.
Appendix A-2 provides a comparative summary OCF, by business.
Appendix A-2: Consolidated Operating Cash Flow |
|||
First Quarter 2018 vs. 2017 |
|||
($ in millions) |
|||
First Quarter |
|||
2018 |
2017 |
Change |
|
Utility |
523 |
558 |
(35) |
Parent & Other |
(57) |
(176) |
119 |
EWC |
91 |
147 |
(56) |
Consolidated |
557 |
529 |
28 |
Calculations may differ due to rounding |
OCF increased quarter-over-quarter driven in part by lower refueling outage spending. Favorable weather in the quarter, compared to unfavorable weather a year ago, also contributed. Lower net revenue at EWC partially offset the increase. Intercompany income tax payments contributed to the line of business variances.
Appendix A-3 and Appendix A-4 list special items by business. Amounts are shown on both an earnings and EPS basis. Special items are included in as-reported earnings consistent with GAAP, but are excluded from operational earnings. As a result, operational earnings is considered a non-GAAP measure.
Appendix A-3: Special Items by Driver (shown as positive/(negative) impact on earnings or EPS) |
|||||
First Quarter 2018 vs. 2017 |
|||||
First Quarter |
|||||
2018 |
2017 |
Change |
|||
(Pre-tax except for income tax effects and total, $ in millions) |
|||||
EWC |
|||||
Items associated with decisions to close or sell EWC nuclear plants |
(99) |
(231) |
132 |
||
Gain on the sale of FitzPatrick |
- |
16 |
(16) |
||
Income tax effect on adjustments above (b) |
21 |
75 |
(54) |
||
Income tax benefit resulting from FitzPatrick transaction |
- |
45 |
(45) |
||
Total EWC |
(78) |
(95) |
17 |
||
Total special items |
(78) |
(95) |
17 |
||
(After-tax, per share in $) (c) |
|||||
EWC |
|||||
Items associated with decisions to close or sell EWC nuclear plants |
(0.43) |
(0.84) |
0.41 |
||
Gain on the sale of FitzPatrick |
- |
0.06 |
(0.06) |
||
Income tax benefit resulting from FitzPatrick transaction |
- |
0.25 |
(0.25) |
||
Total EWC |
(0.43) |
(0.53) |
0.10 |
||
Total special items |
(0.43) |
(0.53) |
0.10 |
||
Calculations may differ due to rounding |
(b) |
Income tax effect is calculated by multiplying the pre-tax amount by the estimated income tax rate that is expected to apply. |
(c) |
EPS effect is calculated by multiplying the pre-tax amount by the estimated income tax rate that is expected to apply to each adjustment and then dividing by the diluted average number of common shares outstanding for the period. |
Appendix A-4: Special Items by Income Statement Line Item (shown as positive/(negative) impact on earnings) First Quarter 2018 vs. 2017 |
|||
(Pre-tax except for Income taxes and total, $ in millions) |
|||
First Quarter |
|||
2018 |
2017 |
Change |
|
EWC |
|||
Net revenue |
- |
91 |
(91) |
Non-fuel O&M |
(25) |
(120) |
95 |
Asset write-off and impairments |
(73) |
(212) |
139 |
Taxes other than income taxes |
(1) |
(4) |
4 |
Gain on sale of assets |
- |
16 |
(16) |
Miscellaneous net (other income) |
- |
15 |
(15) |
Income taxes (d) |
21 |
120 |
(99) |
Total EWC |
(78) |
(95) |
17 |
Total special items (after-tax) |
(78) |
(95) |
17 |
Calculations may differ due to rounding |
(d) |
Income taxes include the income tax effect of the special items which were calculated using the estimated income tax rate that is expected to apply to each item. First quarter 2017 also includes the income tax benefit which resulted from the FitzPatrick transaction. |
B: Earnings Variance Analysis
Appendix B provides details of current quarter 2018 versus 2017 as-reported and operational earnings variance analysis for Utility, Parent & Other and EWC.
Appendix B: As-Reported and Operational Earnings Variance Analysis |
|||||||||||
First Quarter 2018 vs. 2017 |
|||||||||||
(Pre-tax except for Income taxes, $ in millions) |
|||||||||||
Utility |
Parent & Other |
EWC |
Consolidated |
||||||||
As-Reported |
Opera-tional |
As-Reported |
Opera-tional |
As- Reported |
Opera-tional |
As- Reported |
Opera- tional |
||||
2017 earnings |
165 |
165 |
(54) |
(54) |
(28) |
67 |
83 |
178 |
|||
Net revenue |
55 |
55 |
(e) |
- |
- |
(112) |
(22) |
(f) |
(57) |
34 |
|
Non-fuel O&M |
(35) |
(35) |
(g) |
- |
- |
98 |
3 |
(h) |
63 |
(32) |
|
Asset write-offs and impairments |
- |
- |
- |
- |
139 |
- |
(i) |
139 |
- |
||
Decommissioning expense |
3 |
3 |
- |
- |
17 |
17 |
(j) |
20 |
20 |
||
Taxes other than income taxes |
(15) |
(15) |
(k) |
- |
- |
7 |
3 |
(9) |
(12) |
||
Depreciation/amortization exp. |
(14) |
(14) |
- |
- |
14 |
14 |
- |
- |
|||
Gain on sale of assets |
- |
- |
- |
- |
(16) |
- |
(l) |
(16) |
- |
||
Other income (deductions)–other |
12 |
12 |
(1) |
(1) |
(57) |
(43) |
(m) |
(47) |
(32) |
||
Interest exp. and other charges |
(2) |
(2) |
(4) |
(4) |
(2) |
(2) |
(8) |
(8) |
|||
Income taxes |
46 |
46 |
(n) |
(5) |
(5) |
(77) |
22 |
(o) |
(36) |
63 |
|
2018 earnings |
215 |
215 |
(64) |
(64) |
(18) |
60 |
133 |
211 |
|||
Calculations may differ due to rounding |
See appendix in the webcast slide presentation for additional details on EWC line item variances.
(e) |
The earnings increase from higher Utility net revenue was driven by weather, which was positive in first quarter 2018 and negative in first quarter 2017. While weather-adjusted billed sales volume increased across all classes, the net revenue effect was more than offset by lower volume in the unbilled period. Rate changes including E-AR's 2018 FRP and E-TX's TCRF and DCRF also contributed to the increase, but regulatory provisions at E-LA and E-NO to reflect regulatory agreements to return the benefits of the lower effective tax rate in first quarter 2018 to customers more than offset the rate changes. |
(f) |
The earnings decrease from lower EWC net revenue reflected lower volume from merchant nuclear plants, including FitzPatrick (sold first quarter 2017), largely offset by higher nuclear energy prices. The as-reported variance also reflected cost reimbursements from the buyer related to the FitzPatrick sale (classified as a special item and offset in non-fuel O&M). |
(g) |
The earnings decrease from higher Utility non-fuel O&M was primarily due to higher spending on nuclear operations, higher energy efficiency and storm reserve costs (largely offset in net revenue), as well as higher spending on fossil work. This was partly offset by higher nuclear insurance refunds in first quarter 2018. |
(h) |
The as-reported earnings increase from lower EWC non-fuel O&M is primarily due to costs incurred in first quarter 2017 related to the agreement to sell FitzPatrick (classified as a special item and offset in net revenue). |
(i) |
The as-reported earnings increase from lower EWC asset write-offs and impairments was due to lower impairment charges for EWC nuclear plants, partly due to Palisades no longer being impaired as a result of the decision to operate that plant until May 2022, as well as lower refueling outage costs charged to impairment (classified as a special item). |
(j) |
The earnings increase from lower EWC decommissioning expense was primarily due to the sale of FitzPatrick in first quarter 2017. |
(k) |
The earnings decrease from higher Utility taxes other than income taxes was due to higher franchise, ad valorem and payroll taxes. |
(l) |
The as-reported earnings decrease from lower EWC gain on sale of assets was due to the gain on the sale of FitzPatrick in first quarter 2017 (classified as a special item). |
Utility Net Revenue Variance Analysis 2018 vs. 2017 (Pre-tax, $ in millions) |
|
1Q |
|
Estimated weather |
69 |
Volume/unbilled |
(9) |
Retail electric price Reg. provisions for tax reform |
18 (29) |
Other |
6 |
Total |
55 |
(m) |
The earnings decrease from lower EWC other income (deductions)–other was due largely to losses on the decommissioning trust fund investments in first quarter 2018, including unrealized losses on equity investments that were previously recorded to other comprehensive income for periods prior to 2018. In first quarter 2017, only realized gains along with interest and dividends from the decommissioning trust fund investments, were recorded to the income statement. The as-reported earnings decrease also reflected the absence of gains on the receipt of the Indian Point 3 and FitzPatrick decommissioning trust funds from NYPA in first quarter 2017 (classified as a special item). |
(n) |
The earnings increase from lower Utility income taxes is primarily due to the change in the federal income tax rate. |
(o) |
The as-reported earnings decrease from higher EWC income taxes is primarily due to the tax benefit in first quarter 2017, which resulted from the sale of FitzPatrick (classified as a special item). The change in the federal income tax rate, as well as a change in pre-tax income was reflected in the as-reported and operational variances. |
C: Utility Financial and Operating Measures
Appendix C-1 provides a comparative summary of Utility, Parent & Other adjusted earnings and EPS contribution, each of which excludes the effects of special items and normalizes weather and income tax expense.
Appendix C-1: Utility, Parent & Other Adjusted Earnings and EPS - Reconciliation of GAAP to Non-GAAP Measures |
|||||||
First Quarter |
|||||||
2018 |
2017 |
Change |
|||||
($ in millions) |
|||||||
Utility as-reported earnings |
215 |
165 |
50 |
||||
Parent & Other as-reported earnings (loss) |
(64) |
(54) |
(10) |
||||
UP&O as-reported earnings |
151 |
110 |
41 |
||||
Less: |
|||||||
Special items |
- |
- |
- |
||||
Estimated weather (p) |
22 |
(48) |
69 |
||||
Tax effect of estimated weather (q) |
(6) |
18 |
(24) |
||||
Estimated weather impact (after-tax) |
16 |
(29) |
46 |
||||
Other income tax items (r) |
6 |
(9) |
15 |
||||
UP&O adjusted earnings |
129 |
149 |
(20) |
||||
(After tax, per share in $)(s) |
|||||||
Utility as-reported earnings |
1.19 |
0.92 |
0.27 |
||||
Parent & Other as-reported earnings (loss) |
(0.36) |
(0.30) |
(0.06) |
||||
UP&O as-reported earnings |
0.83 |
0.62 |
0.21 |
||||
Less: |
|||||||
Special items |
- |
- |
- |
||||
Estimated weather |
0.09 |
(0.16) |
0.25 |
||||
Other income tax items |
0.03 |
(0.05) |
0.08 |
||||
UP&O adjusted earnings |
0.71 |
0.83 |
(0.12) |
Calculations may differ due to rounding |
(p) |
The effects of weather were estimated using heating degree days and cooling degree days for the billing cycles 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 are subject to change. |
(q) |
Income tax effect is calculated by multiplying the pre-tax amount by the estimated income tax rates that are expected to apply. |
(r) |
Other income tax items represent the adjustment made to income tax expense to reflect a statutory tax rate estimated to be 25.5% in 2018 and 38.5% in 2017. |
(s) |
Per share amounts are calculated by dividing the corresponding earnings (loss) by the diluted average number of common shares outstanding for the period. |
Appendix C-2 and Appendix C-3 provides comparative summaries of Utility operating and financial measures.
Appendix C-2: Utility Operating and Financial Measures |
||||
First Quarter 2018 vs. 2017 |
||||
First Quarter |
||||
2018 |
2017 |
% Change |
% Weather |
|
GWh billed |
||||
Residential |
9,287 |
7,637 |
21.6 |
4.1 |
Commercial |
6,732 |
6,439 |
4.6 |
2.4 |
Governmental |
608 |
593 |
2.5 |
2.2 |
Industrial |
11,405 |
11,117 |
2.6 |
2.6 |
Total retail sales |
28,032 |
25,786 |
8.7 |
3.0 |
Wholesale |
3,244 |
3,022 |
7.3 |
|
Total sales |
31,276 |
28,808 |
8.6 |
|
Number of electric retail customers |
||||
Residential |
2,476,056 |
2,469,879 |
0.3 |
|
Commercial |
356,034 |
355,138 |
0.3 |
|
Governmental |
17,945 |
18,229 |
(1.6) |
|
Industrial |
40,856 |
41,043 |
(0.5) |
|
Total retail customers |
2,890,891 |
2,884,289 |
0.2 |
|
As-reported net revenue ($ in millions) |
1,460 |
1,404 |
4.0 |
|
Non-fuel O&M per MWh |
$20.09 |
$20.61 |
(2.5) |
|
Appendix C-3: Utility Operating Measures |
||||
Twelve Months Ended March 31, 2018 vs. 2017 |
||||
Twelve Months Ended March 31 |
||||
2018 |
2017 |
% Change |
% Weather Adjusted (t) |
|
GWh billed |
||||
Residential |
35,484 |
34,612 |
2.5 |
3.0 |
Commercial |
29,039 |
29,125 |
(0.3) |
1.8 |
Governmental |
2,525 |
2,540 |
(0.6) |
0.1 |
Industrial |
48,057 |
45,801 |
4.9 |
4.9 |
Total retail sales |
115,105 |
112,078 |
2.7 |
3.4 |
Calculations may differ due to rounding |
Certain prior year data has been reclassified to conform with current year presentation |
(t) |
The effects of weather were estimated using heating degree days and cooling degree days for the billing cycles from certain locations within each jurisdiction and comparing to "normal" weather based on 20-year historical data. The models used to estimate weather are updated periodically and are subject to change. |
D: EWC Financial and Operating Measures
Appendix D-1 provides a comparative summary of EWC operational adjusted EBITDA (non-GAAP).
Appendix D-1: EWC Operational Adjusted EBITDA - Reconciliation of GAAP to Non-GAAP Measures |
|||
First Quarter 2018 vs. 2017 |
|||
($ in millions) |
First Quarter |
||
2018 |
2017 |
Change |
|
Net income (loss) |
(18) |
(27) |
9 |
Add back: interest expense |
8 |
6 |
2 |
Add back: income taxes |
(1) |
(78) |
77 |
Add back: depreciation and amortization |
38 |
53 |
(15) |
Subtract: interest and investment income |
(1) |
43 |
(44) |
Add back: decommissioning expense |
58 |
75 |
(17) |
Adjusted EBITDA (non-GAAP) |
86 |
(15) |
101 |
Add back pre-tax special items for: |
|||
Items associated with decisions to close or sell EWC nuclear plants |
99 |
231 |
(132) |
Gain on the sale of FitzPatrick |
- |
(16) |
16 |
Operational adjusted EBITDA (non-GAAP) |
185 |
200 |
(15) |
Calculations may differ due to rounding |
Appendix D-2 provides a comparative summary of EWC operating and financial measures.
Appendix D-2: EWC Operational and Financial Measures |
|||
First Quarter 2018 vs. 2017 (See Appendix G for reconciliation of GAAP to non-GAAP measures) |
|||
First Quarter |
|||
2018 |
2017 |
% Change |
|
Owned capacity (MW) (u) |
3,962 |
4,800 |
(17.5) |
GWh billed |
7,885 |
8,363 |
(5.7) |
As-reported net revenue ($ in millions) |
382 |
494 |
(22.7) |
Operational net revenue (non-GAAP) ($ in millions) |
382 |
404 |
(5.4) |
EWC Nuclear Fleet |
|||
Capacity factor |
83% |
80% |
3.7 |
GWh billed |
6,408 |
7,835 |
(18.2) |
Production cost per MWh |
$18.75 |
$16.36 |
14.6 |
Average energy/capacity revenue per MWh (v) |
$56.96 |
$55.15 |
3.3 |
As-reported net revenue ($ in millions) |
379 |
491 |
(22.9) |
Operational net revenue ($ in millions) |
379 |
401 |
(5.6) |
Refueling outage days |
|||
FitzPatrick |
- |
42 |
|
Indian Point 2 |
13 |
- |
|
Indian Point 3 |
- |
19 |
|
Calculations may differ due to rounding |
(u) |
FitzPatrick (838 MW) was sold on 3/31/17. |
(v) |
Average energy and capacity revenue per MWh excluding FitzPatrick was $55.27 in first quarter 2017. |
See appendix in the webcast slide presentation for EWC hedging and price disclosures.
E: Consolidated Financial Measures
Appendix E provides comparative financial measures. Financial measures in this table include those calculated and presented in accordance with GAAP, as well as those that are considered non-GAAP financial measures.
Appendix E: GAAP and Non-GAAP Financial Measures |
|||
First Quarter 2018 vs. 2017 (See Appendix G for reconciliation of GAAP to non-GAAP financial measures) |
|||
For 12 months ending March 31 |
2018 |
2017 |
Change |
GAAP Measures |
|||
ROIC – as-reported |
3.9% |
(1.3%) |
5.2% |
ROE – as-reported |
5.8% |
(8.4%) |
14.2% |
Book value per share |
$44.11 |
$44.90 |
($0.79) |
End of period shares outstanding (in millions) |
180.8 |
179.4 |
1.4 |
Non-GAAP Measures |
|||
ROIC – operational |
7.4% |
6.7% |
0.7% |
ROE – operational |
16.6% |
13.9% |
2.7% |
As of March 31 ($ in millions) |
2018 |
2017 |
Change |
GAAP Measures |
|||
Cash and cash equivalents |
1,206 |
1,083 |
123 |
Revolver capacity |
3,010 |
4,185 |
(1,175) |
Commercial paper |
655 |
1,088 |
(433) |
Total debt |
17,680 |
15,611 |
2,069 |
Securitization debt |
520 |
637 |
(117) |
Debt to capital |
68.4% |
65.4% |
3.0% |
Off-balance sheet liabilities: |
|||
Debt of joint ventures – Entergy's share |
66 |
71 |
(5) |
Leases – Entergy's share |
429 |
397 |
32 |
Power purchase agreements accounted for as leases |
136 |
166 |
(30) |
Total off-balance sheet liabilities |
631 |
634 |
(3) |
Non-GAAP Financial Measures |
|||
Debt to capital, excluding securitization debt |
67.7% |
64.4% |
3.3% |
Gross liquidity |
4,216 |
5,268 |
(1,052) |
Net debt to net capital, excluding securitization debt |
66.1% |
62.7% |
3.4% |
Parent debt to total debt, excluding securitization debt |
21.2% |
21.1% |
0.1% |
Debt to operational adjusted EBITDA, excluding securitization debt |
5.0x |
4.4x |
0.6x |
Operational FFO to debt, excluding securitization debt |
15.4% |
17.3% |
(1.9%) |
F: Definitions and Abbreviations and Acronyms
Appendix F-1 provides definitions of certain operating measures, as well as GAAP and non-GAAP financial measures. Non-GAAP financial measures remove the effects of financial events that are not routine from commonly used financial measures.
Appendix F-1: Definitions |
|
Utility Operating and Financial Measures |
|
GWh billed |
Total number of GWh billed to retail and wholesale customers |
Net revenue |
Operating revenues 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 the end of the prior year |
EWC Operating and Financial Measures |
|
Average revenue under contract per kW-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 New England, 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 |
Appendix F-1: Definitions |
|
EWC Operating and Financial Measures (continued) |
|
GWh billed |
Total number of GWh billed to customers and financially-settled instruments |
Net revenue |
Operating revenues less fuel, fuel-related expenses and purchased power |
Offsetting positions |
Transactions for the purchase of energy, generally to offset a Firm LD transaction |
Owned capacity (MW) |
Installed capacity owned by EWC |
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 intent to shutdown Pilgrim (May 31, 2019), Indian Point 2 (April 30, 2020), Indian Point 3 (April 30, 2021) and Palisades (May 31, 2022) |
Planned TWh of generation |
Amount of output expected to be generated by EWC resources considering plant operating characteristics and outage schedules, assuming intent to shutdown Pilgrim (May 31, 2019), Indian Point 2 (April 30, 2020), Indian Point 3 (April 30, 2021) and Palisades (May 31, 2022) |
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 a scheduled refueling and maintenance outage during the period |
Unit-contingent |
Transaction under which power is supplied from a specific generation asset; if the asset is in 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 |
ROE – as-reported |
12-months rolling net income attributable to Entergy Corporation divided by average common equity |
ROIC – as-reported |
12-months rolling net income attributable to Entergy Corporation adjusted for preferred dividends and tax-effected interest expense divided by average invested capital |
Securitization debt |
Debt associated with securitization bonds issued to recover storm costs from hurricanes Rita, Ike and Gustav at E-TX and Hurricane Isaac at E-NO; the 2009 ice storm at E-AR and investment recovery of costs associated with the cancelled Little Gypsy repowering project at E-LA |
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 and excluding decommissioning expense; for Entergy consolidated, also excludes AFUDC-equity funds and subtracts securitization proceeds |
Adjusted EPS |
As-reported EPS excluding special items and normalizing weather and income taxes |
Debt to capital ratio, excluding securitization debt |
Total debt divided by total capitalization, excluding securitization debt |
Debt to operational adjusted EBITDA ratio, excluding securitization debt |
End of period total debt excluding securitization debt divided by 12-months rolling operational adjusted EBITDA |
FFO |
OCF less AFUDC-borrowed funds, working capital items in OCF (receivables, fuel inventory, accounts payable, prepaid taxes and taxes accrued, interest accrued and other working capital accounts) and securitization regulatory charges |
Gross liquidity |
Sum of cash and revolver capacity |
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 |
Operational adjusted EBITDA |
Adjusted EBITDA excluding effects of special items |
Operational EPS |
As-reported EPS excluding special items |
Operational FFO |
FFO excluding the effects of special items |
Operational FFO to debt ratio, excluding securitization debt |
12-months rolling operational FFO as a percentage of end of period total debt excluding securitization debt |
Parent debt to total debt ratio, excluding securitization debt |
End of period Entergy Corporation debt, including amounts drawn on credit revolver and commercial paper facilities, as a percent of consolidated total debt, excluding securitization debt |
ROE – operational |
12-months rolling operational net income attributable to Entergy Corporation divided by average common equity |
ROIC – operational |
12-months rolling operational net income attributable to Entergy Corporation adjusted for preferred dividends and tax-effected interest expense divided by average invested capital |
Utility, Parent & Other |
Combines the Utility segment with Parent & Other, which is all of Entergy excluding the EWC segment |
Appendix F-2 explains abbreviations and acronyms used in the quarterly earnings materials.
Appendix F-2: Abbreviations and Acronyms |
|||
ADIT |
Accumulated deferred income taxes |
ISES 2 |
Unit 2 of Independence Steam Electric Station (coal) |
AFUDC - borrowed funds |
Allowance for borrowed funds used during construction |
LPSC |
Louisiana Public Service Commission |
AFUDC - equity funds |
Allowance for equity funds used during construction |
LTM |
Last twelve months |
ALJ |
Administrative Law Judge |
MISO |
Midcontinent Independent System Operator, Inc. |
AMI |
Advanced metering infrastructure |
Moody's |
Moody's Investor Service |
ANO |
Units 1 and 2 of Arkansas Nuclear One owned by E-AR (nuclear) |
MPSC |
Mississippi Public Service Commission |
APSC |
Arkansas Public Service Commission |
MTEP |
MISO Transmission Expansion Planning |
ARO |
Asset retirement obligation |
Nelson 6 |
Unit 6 of Roy S. Nelson plant (coal) |
ASU |
Accounting Standards Update issued by the Financial Accounting Standards Board |
NEPOOL |
New England Power Pool |
bps |
Basis points |
Ninemile 6 |
Ninemile Point Unit 6 (CCGT) |
CCGT |
Combined cycle gas turbine |
Non-fuel O&M |
Non-fuel operation and maintenance expense |
CCNO |
Council of the City of New Orleans, Louisiana |
NDT |
Nuclear decommissioning trust |
COD |
Commercial operation date |
NOPS |
New Orleans Power Station (reciprocating internal combustion engine/natural gas) |
CT |
Simple cycle combustion turbine |
NRC |
Nuclear Regulatory Commission |
DCRF |
Distribution cost recovery factor |
NYISO |
New York Independent System Operator, Inc. |
DOE |
U.S. Department of Energy |
NYPA |
New York Power Authority |
E-AR |
Entergy Arkansas, Inc. |
NYSE |
New York Stock Exchange |
E-LA |
Entergy Louisiana, LLC |
O&M |
Operation and maintenance expense |
E-MS |
Entergy Mississippi, Inc. |
OCF |
Net cash flow provided by operating activities |
E-NO |
Entergy New Orleans, LLC |
OpCo |
Operating Company |
E-TX |
Entergy Texas, Inc. |
OPEB |
Other post-employment benefits |
EBITDA |
Earnings before interest, income taxes, depreciation and amortization |
Palisades |
Palisades Power Plant (nuclear) |
ENVY |
Entergy Nuclear Vermont Yankee |
Pilgrim |
Pilgrim Nuclear Power Station (nuclear) |
ESI |
Entergy Services, Inc. |
PPA |
Power purchase agreement or purchased power agreement |
EPS |
Earnings per share |
PUCT |
Public Utility Commission of Texas |
ETR |
Entergy Corporation |
RFP |
Request for proposals |
EWC |
Entergy Wholesale Commodities |
ROE |
Return on equity |
FERC |
Federal Energy Regulatory Commission |
ROIC |
Return on invested capital |
FFO |
Funds from operations |
RPCE |
Rough production cost equalization |
Firm LD |
Firm liquidated damages |
RS Cogen |
RS Cogen facility (CCGT cogeneration) |
FitzPatrick |
James A. FitzPatrick Nuclear Power Plant (nuclear, sold March 31, 2017) |
RSP |
Rate Stabilization Plan (E-LA Gas) |
FRP |
Formula rate plan |
S&P |
Standard & Poor's |
GAAP |
U.S. generally accepted accounting principles |
SEC |
U.S. Securities and Exchange Commission |
Grand Gulf |
Unit 1 of Grand Gulf Nuclear Station (nuclear), 90% owned or leased by SERI |
SERI |
System Energy Resources, Inc. |
Indian Point 1 or IP1 |
Indian Point Energy Center Unit 1 (nuclear) (shut down in 1974) |
TCRF |
Transmission cost recovery factor |
Indian Point 2 or IP2 |
Indian Point Energy Center Unit 2 (nuclear) |
Union |
Union Power Station (CCGT) |
Indian Point 3 or IP3 |
Indian Point Energy Center Unit 3 (nuclear) |
UP&O |
Utility, Parent & Other |
IPEC |
Indian Point Energy Center (nuclear) |
VPUC |
Vermont Public Utility Commission |
ISO |
Independent system operator |
VY or Vermont Yankee |
Vermont Yankee Nuclear Power Station (nuclear) |
WACC |
Weighted-average cost of capital |
||
WPEC |
Washington Parish Energy Center (CT/natural gas) |
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 - EWC Operational Net Revenue |
|||||||
($ in millions except where noted) |
First Quarter |
||||||
2018 |
2017 |
||||||
EWC |
|||||||
As-reported net revenue |
(A) |
382 |
494 |
||||
Special items included in net revenue: |
|||||||
EWC Nuclear costs associated with decisions to close or sell plants |
- |
91 |
|||||
Total special items included in net revenue |
(B) |
- |
91 |
||||
Operational net revenue |
(A-B) |
382 |
404 |
||||
EWC Nuclear |
|||||||
As-reported EWC Nuclear net revenue |
(C) |
379 |
491 |
||||
Special items included in EWC Nuclear net revenue: |
|||||||
EWC Nuclear costs associated with decisions to close or sell plants |
- |
91 |
|||||
Total special items included in EWC Nuclear net revenue |
(D) |
- |
91 |
||||
Operational EWC Nuclear net revenue |
(C-D) |
379 |
401 |
||||
Calculations may differ due to rounding |
Appendix G-2: Reconciliation of GAAP to Non-GAAP Financial Measures - ROIC, ROE |
|||
($ in millions except where noted) |
First Quarter |
||
2018 |
2017 |
||
As-reported net income (loss) attributable to Entergy Corporation, rolling 12 months |
(A) |
462 |
(731) |
Preferred dividends |
14 |
17 |
|
Tax effected interest expense |
499 |
409 |
|
As-reported net income (loss) attributable to Entergy Corporation, rolling 12 months adjusted for preferred dividends and tax effected interest expense |
(B) |
975 |
(305) |
Special items in prior quarters |
(793) |
(1,842) |
|
Items associated with decisions to close or sell EWC nuclear plants |
(78) |
(150) |
|
Gain on the sale of FitzPatrick |
- |
11 |
|
Income tax benefit resulting from FitzPatrick transaction |
- |
45 |
|
Total special items, rolling 12 months |
(C) |
(871) |
(1,937) |
Operational earnings, rolling 12 months adjusted for preferred dividends and tax effected interest expense (non-GAAP) |
(B-C) |
1,846 |
1,632 |
Operational earnings, rolling 12 months (non-GAAP) |
(A-C) |
1,333 |
1,206 |
Average invested capital |
(D) |
24,862 |
24,321 |
Average common equity |
(E) |
8,016 |
8,709 |
ROIC – as-reported |
(B/D) |
3.9% |
(1.3%) |
ROIC – operational |
[(B-C)/D] |
7.4% |
6.7% |
ROE – as-reported |
(A/E) |
5.8% |
(8.4%) |
ROE – operational |
[(A-C)/E] |
16.6% |
13.9% |
Calculations may differ due to rounding |
Appendix G-3: Reconciliation of GAAP to Non-GAAP Financial Measures – Debt Ratios excluding Securitization Debt; Gross Liquidity; Debt to Operational Adjusted EBITDA, excluding Securitization Debt; Operational FFO to Debt Ratio, excluding Securitization Debt |
|||
($ in millions except where noted) |
First Quarter |
||
2018 |
2017 |
||
Total debt |
(A) |
17,680 |
15,611 |
Less securitization debt |
(B) |
520 |
637 |
Total debt, excluding securitization debt |
(C) |
17,160 |
14,974 |
Less cash and cash equivalents |
(D) |
1,206 |
1,083 |
Net debt, excluding securitization debt |
(E) |
15,954 |
13,891 |
Total capitalization |
(F) |
25,853 |
23,871 |
Less securitization debt |
(B) |
520 |
637 |
Total capitalization, excluding securitization debt |
(G) |
25,333 |
23,234 |
Less cash and cash equivalents |
(D) |
1,206 |
1,083 |
Net capital, excluding securitization debt |
(H) |
24,127 |
22,151 |
Debt to capital |
(A/F) |
68.4% |
65.4% |
Debt to capital, excluding securitization debt |
(C/G) |
67.7% |
64.4% |
Net debt to net capital, excluding securitization debt |
(E/H) |
66.1% |
62.7% |
Revolver capacity |
(I) |
3,010 |
4,185 |
Gross liquidity |
(D+I) |
4,216 |
5,268 |
Entergy Corporation notes: |
|||
Due September 2020 |
450 |
450 |
|
Due July 2022 |
650 |
650 |
|
Due September 2026 |
750 |
750 |
|
Total parent long-term debt |
(J) |
1,850 |
1,850 |
Revolver draw |
(K) |
1,125 |
225 |
Commercial paper |
(L) |
655 |
1,088 |
Total parent debt |
(J)+(K)+(L) |
3,630 |
3,163 |
Parent debt to total debt, excluding securitization debt |
[((J)+(K)+(L))/(C)] |
21.2% |
21.1% |
Appendix G-3: Reconciliation of GAAP to Non-GAAP Financial Measures – Debt Ratios excluding Securitization Debt; Gross Liquidity; Debt to Operational Adjusted EBITDA, excluding Securitization Debt; Operational FFO to Debt Ratio, excluding Securitization Debt (continued) |
|||
($ in millions except where noted) |
First Quarter |
||
2018 |
2017 |
||
Total debt |
(A) |
17,680 |
15,611 |
Less securitization debt |
(B) |
520 |
637 |
Total debt, excluding securitization debt |
(C) |
17,160 |
14,974 |
As-reported consolidated net income (loss), rolling 12 months |
476 |
(714) |
|
Add back (rolling 12 months): |
|||
Interest expense |
670 |
664 |
|
Income taxes |
578 |
(949) |
|
Depreciation and amortization |
1,390 |
1,360 |
|
Regulatory charges (credits) |
(4) |
8 |
|
Decommissioning expense |
386 |
373 |
|
Subtract (rolling 12 months): |
|||
Securitization proceeds |
150 |
143 |
|
Interest and investment income |
249 |
169 |
|
AFUDC-equity funds |
104 |
68 |
|
Adjusted EBITDA, rolling 12 months (non-GAAP) |
(D) |
2,993 |
362 |
Add back special items (rolling 12 months pre-tax): |
|||
Items associated with decisions to close or sell EWC nuclear plants |
511 |
3,121 |
|
Tax reform |
(56) |
- |
|
DOE litigation awards |
- |
(34) |
|
Gain on the sale of FitzPatrick |
- |
(16) |
|
Operational adjusted EBITDA, rolling 12 months (non-GAAP) |
(E) |
3,448 |
3,433 |
Debt to operational adjusted EBITDA, excluding securitization debt |
(C)/(E) |
5.0x |
4.4x |
Net cash flow provided by operating activities, rolling 12 months |
(F) |
2,652 |
2,995 |
AFUDC-borrowed funds, rolling 12 months |
(G) |
(49) |
(34) |
Working capital items in net cash flow provided by operating activities (rolling 12 months): |
|||
Receivables |
(123) |
(17) |
|
Fuel inventory |
(26) |
54 |
|
Accounts payable |
81 |
194 |
|
Prepaid taxes and taxes accrued |
36 |
(72) |
|
Interest accrued |
5 |
6 |
|
Other working capital accounts |
(25) |
119 |
|
Securitization regulatory charges |
121 |
114 |
|
Total |
(H) |
69 |
398 |
FFO, rolling 12 months |
(F)+(G)-(H) |
2,534 |
2,563 |
Add back special items (rolling 12 months pre-tax): |
|||
Items associated with decisions to close or sell EWC nuclear plants |
108 |
24 |
|
Operational FFO, rolling 12 months |
(I) |
2,642 |
2,587 |
Operational FFO to debt, excluding securitization debt |
(I)/(C) |
15.4% |
17.3% |
Calculations may differ due to rounding |
SOURCE Entergy Corporation
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