Entergy Reports Third Quarter Results

Consolidated Earnings – Reconciliation of GAAP to Non-GAAP Measures

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

Third Quarter

Year-to-Date

2015

2014

Change

2015

2014

Change

As-Reported Earnings (Loss)

($ in millions)

(723.0)

230.0

(953.1)

(276.1)

820.6

(1,096.7)

Less Special Items:

  Pilgrim/FitzPatrick asset impairments

  and related write-offs

(1,062.5)

–

(1,062.5)

(1,062.5)

–

(1,062.5)

  Decision to close VY

(1.2)

(73.7)

72.5

(6.9)

(86.4)

79.5

  HCM implementation expenses

–

(0.6)

0.6

–

(7.8)

7.8

Total Special Items

(1,063.7)

(74.3)

(989.4)

(1,069.4)

(94.2)

(975.2)

Operational Earnings

340.7

304.4

36.3

793.3

914.8

(121.5)

Weather Impact

29.3

(20.0)

49.3

40.7

3.2

37.5

As-Reported Earnings (Loss)

(per share in $)

(4.04)

1.27

(5.31)

(1.54)

4.56

(6.10)

Less Special Items:

  Pilgrim/FitzPatrick asset impairments

  and related write-offs

(5.93)

–

(5.93)

(5.92)

–

(5.92}

  HCM implementation expenses

–

–

–

–

(0.04)

0.04

  Decision to close VY

(0.01)

(0.41)

0.40

(0.04)

(0.48)

0.44

Total Special Items

(5.94)

(0.41)

(5.53)

(5.96)

(0.52)

(5.44)

Operational Earnings

1.90

1.68

0.22

4.42

5.08

(0.66)

Weather Impact

0.16

(0.11)

0.27

0.23

0.02

0.21

Totals may not foot due to rounding

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

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

($ in millions)

Third Quarter

Year-to-Date

2015

2014

Change

2015

2014

Change

Net income

(1,032)

(33)

(999)

(913)

235

(1,148)

Add back: interest expense

7

4

3

19

12

7

Add back: income tax expense

(555)

2

(557)

(488)

141

(629)

Add back: depreciation and amortization

60

72

(12)

187

213

(26)

Subtract: interest and investment income

29

29

–

116

77

39

Add back: decommissioning expense

33

35

(2)

101

104

(3)

Adjusted EBITDA

(1,515)

51

(1,566)

(1,210)

627

(1,837)

Add back:

  Special item for HCM implementation (pre-tax)

–

1

(1)

–

3

(3)

  Special item for the decision to close VY (pre-tax)

2

113

(111)

11

134

(123)

  Special item for Pilgrim/FitzPatrick asset impairments and related write-offs (pre-tax)

1,642

–

1,642

1,642

–

1,642

Operational adjusted EBITDA

129

165

(36)

443

764

(321)

Totals may not foot due to rounding

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

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

(Per share in $)

Third Quarter

Year-to-Date

2015

2014

Change

2015

2014

Change

As-Reported

Utility

2.01

1.72

0.29

4.36

4.00

0.36

Parent & Other

(0.29)

(0.27)

(0.02)

(0.81)

(0.74)

(0.07)

EWC

(5.76)

(0.18)

(5.58)

(5.09)

1.30

(6.39)

  Consolidated As-Reported Earnings (Loss)

(4.04)

1.27

(5.31)

(1.54)

4.56

(6.10)

Less Special Items

Utility

–

–

–

–

(0.03)

0.03

Parent & Other

–

–

–

–

–

–

EWC

(5.94)

(0.41)

(5.53)

(5.96)

(0.49)

(5.47)

  Consolidated Special Items

(5.94)

(0.41)

(5.53)

(5.96)

(0.52)

(5.44)

Operational

Utility

2.01

1.72

0.29

4.36

4.03

0.33

Parent & Other

(0.29)

(0.27)

(0.02)

(0.81)

(0.74)

(0.07)

EWC

0.18

0.23

(0.05)

0.87

1.79

(0.92)

  Consolidated Operational Earnings

1.90

1.68

0.22

4.42

5.08

(0.66)

Weather Impact

0.16

(0.11)

0.27

0.23

0.02

0.21

Appendix 1-2: Consolidated Operating Cash Flow

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

($ in millions)

Third Quarter

Year-to-Date

2015

2014

Change

2015

2014

Change

Utility

833

1,239

(406)

2,049

2,243

(194)

Parent & Other

13

(83)

96

(81)

(208)

127

EWC

165

207

(42)

381

856

(475)

  Total Operating Cash Flow

1,011

1,363

(352)

2,350

2,891

(542)

Totals may not foot due to rounding

Appendix 1-3: Special Items by Driver (shown as positive/(negative) impact on EPS)

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

(After-tax, per share in $)

Third Quarter

Year-to-Date

2015

2014

Change

2015

2014

Change

Utility

HCM implementation expenses

–

–

–

–

(0.03)

0.03

  Total Utility

–

–

–

–

(0.03)

0.03

EWC

Pilgrim/FitzPatrick asset impairments

  and related write-offs

(5.93)

–

(5.93)

(5.92)

–

(5.92)

Decision to close VY

(0.01)

(0.41)

0.40

(0.04)

(0.48)

0.44

HCM implementation expenses

–

–

–

–

(0.01)

0.01

  Total EWC

(5.94)

(0.41)

(5.53)

(5.96)

(0.49)

(5.47)

Total Special Items

(5.94)

(0.41)

(5.53)

(5.96)

(0.52)

(5.44)

Appendix 1-4: Special Items by Income Statement Line Item (shown as positive/(negative) impact on earnings)

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

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

Third Quarter

Year-to-Date

2015

2014

Change

2015

2014

Change

Utility

Non-fuel O&M

–

(0.7)

0.7

–

(10.2)

10.2

Taxes other than income taxes

–

–

–

–

(0.5)

0.5

Income taxes – other

–

0.4

(0.4)

–

4.6

(4.6)

  Total Utility

–

(0.3)

0.3

–

(6.1)

6.1

EWC

Non-fuel O&M

(1.7)

(10.2)

8.5

(10.8)

(27.6)

16.8

Taxes other than income taxes

(0.1)

(0.8)

0.7

0.2

(2.2)

2.4

Asset write-off and impairments

(1,642.2)

(103.0)

(1,539.2)

(1,642.2)

(107.0)

(1,535.2)

Income taxes – other

580.3

39.9

540.4

583.4

48.6

534.8

  Total EWC

(1,063.7)

(74.0)

(989.7)

(1,069.4)

(88.1)

(981.3)

Total Special Items

(1,063.7)

(74.3)

(989.4)

(1,069.4)

(94.2)

(975.2)

Totals may not foot due to rounding

Appendix 2-1: As-Reported and Operational EPS Variance Analysis

Third 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

1.72

1.72

(0.27)

(0.27)

(0.18)

0.23

1.27

1.68

Asset write-off and impairments

0.23

0.23

(a)

–

–

(5.56)

–

(b)

(5.33)

0.23

Net revenue

0.36

0.36

(c)

–

–

(0.26)

(0.26)

(d)

0.10

0.10

Income taxes – other

–

–

–

–

0.03

0.03

0.03

0.03

Share effect

0.01

0.01

–

–

–

–

0.01

0.01

Decommissioning expense

(0.01)

(0.01)

–

–

0.01

0.01

–

–

Taxes other than income taxes

(0.03)

(0.03)

–

–

0.03

0.03

–

–

Depreciation/amortization expense

(0.05)

(0.05)

(e)

–

–

0.04

0.04

(0.01)

(0.01)

Interest expense and other charges

(0.01)

(0.01)

(0.01)

(0.01)

(0.01)

(0.01)

(0.03)

(0.03)

Other income (deductions)-other

(0.05)

(0.05)

(f)

–

–

–

–

(0.05)

(0.05)

Non-fuel O&M

(0.16)

(0.16)

(g)

(0.01)

(0.01)

0.14

0.11

(h)

(0.03)

(0.06)

2015 earnings

2.01

2.01

(0.29)

(0.29)

(5.76)

0.18

(4.04)

1.90

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

4.00

4.03

(0.74)

(0.74)

1.30

1.79

4.56

5.08

Asset write-off and impairments

0.23

0.23

(a)

–

–

(5.54)

–

(b)

(5.31)

0.23

Other income (deductions) – other

0.02

0.02

(0.05)

(0.05)

(i)

0.12

0.12

(j)

0.09

0.09

Income taxes – other

0.10

0.10

(k)

(0.01)

(0.01)

(0.03)

(0.03)

0.06

0.06

Share effect

0.01

0.01

–

–

–

–

0.01

0.01

Decommissioning expense

(0.03)

(0.03)

–

–

0.01

0.01

(0.02)

(0.02)

Taxes other than income taxes

(0.07)

(0.07)

(l)

–

–

0.05

0.04

(0.02)

(0.03)

Depreciation/amortization expense

(0.14)

(0.14)

(e)

–

–

0.09

0.09

(m)

(0.05)

(0.05)

Interest expense and other charges

(0.05)

(0.05)

(n)

0.01

0.01

(0.02)

(0.02)

(0.06)

(0.06)

Non-fuel O&M

(0.56)

(0.59)

(g)

(0.01)

(0.01)

0.36

0.30

(h)

(0.21)

(0.30)

Net revenue

0.85

0.85

(c)

(0.01)

(0.01)

(1.43)

(1.43)

(d)

(0.59)

(0.59)

2015 earnings

4.36

4.36

(0.81)

(0.81)

(5.09)

0.87

(1.54)

4.42

(a) 

The current quarter and year to date increases were due to the third quarter 2014 charge associated with the EMI rate case settlement ($60.9 million pre-tax, $40.5 million after-tax).

(b) 

The as-reported current quarter and year-to date decreases were primarily due to non-cash impairment charges and related write-offs in the current quarter for the Pilgrim and FitzPatrick plants totaling $(5.93)/share. Partially offsetting this decrease was a third quarter 2014 charge for an updated VY decommissioning cost study.

(c) 

The current quarter and year-to date increases were due to favorable weather, an increase in industrial usage and pricing. The price variance included the Louisiana FRP rate adjustments for placing Ninemile 6 in rates and the EMI rate case. Year-to-date included higher volume from all classes.

(d) 

The current quarter and year-to-date decreases were due to the retirement of VY at the end of 2014 along with lower realized nuclear capacity and energy pricing. Also contributing to the decreases in the year-to-date period was the negative net effect of mark-to-market activity in the current period compared to a positive contribution in the comparable period a year ago. Fewer refueling outage days provided a partial offset in both periods.

(e) 

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

(f) 

The current quarter decrease was due partly to lower decommissioning trust earnings (offset in net revenue), lower AFUDC equity and carrying charges recorded in 2014 on storm restoration costs related to Hurricane Isaac.

(g) 

The current quarter and year-to-date decreases reflected regulatory compliance costs resulting from the NRC's decision to move ANO into Column 4 of the reactor oversight process action matrix (approximately $21 million in third quarter 2015 and approximately $38 million in the year-to-date period). Also higher were expenses for distribution reliability. Year-to-date includes higher other nuclear and fossil expenses. 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.

(h) 

The current quarter and year-to-date increases were attributable to the closure of VY at the end of 2014. Excluding VY, year-over-year non-fuel O&M was higher due to higher refueling outage amortization and fewer refueling outage days resulting in the lower deferral of costs for future amortization.

(i) 

The year-to-date decrease was due primarily to higher earnings on investments in affiliate preferred membership interests (offset in Utility).

(j) 

The year-to-date increase was due primarily to higher realized gains on decommissioning trusts, including the rebalancing of VY's decommissioning trust portfolio in the current year.

(k) 

The year-to-date increase was attributable to a first quarter 2015 adjustment of approximately $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 benefit of approximately $10 million resulting from Act 55 storm securitization in third quarter 2014.

(l) 

The year-to-date decrease was primarily due to higher payroll taxes and ad valorem tax assessments.

(m) 

The year-to-date increase was mainly attributable to the absence of VY depreciation.

(n) 

The year-to-date decrease resulted from net debt issuances in fourth quarter 2014.

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

Third Quarter

Year-to-Date

Weather

0.27

0.21

Sales growth/pricing

0.15

0.73

Other

(0.06)

(0.09)

0.36

0.85

Appendix 3-1: Utility Operational Performance Measures

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

Third Quarter

Year-to-Date

2015

2014

% Change

% Weather Adjusted (o)

2015

2014

% Change

% Weather Adjusted (o)

GWh billed

Residential

11,887

10,869

9.4

(0.1)

28,683

28,162

1.9

0.4

Commercial

8,744

8,281

5.6

1.2

22,370

21,844

2.4

0.6

Governmental

692

659

5.0

4.9

1,886

1,829

3.1

2.9

Industrial

12,087

11,620

4.0

4.0

33,230

32,635

1.8

1.8

Total Retail Sales

33,410

31,429

6.3

1.8

86,169

84,470

2.0

1.0

Wholesale

2,586

2,075

24.6

7,535

6,357

18.5

Total Sales

35,996

33,504

7.4

93,704

90,827

3.2

Number of electric retail customers

Residential

2,434,079

2,411,773

0.9

Commercial

348,920

345,338

1.0

Governmental

17,779

17,314

2.7

Industrial

49,941

49,868

0.1

Total Retail Customers

2,850,719

2,824,293

0.9

Net Revenue ($ millions)

1,750

1,646

6.3

4,648

4,401

5.6

As-reported non-fuel O&M per MWh

$18.42

$18.42

–

$20.17

$19.02

6.0

Operational non-fuel O&M per MWh

$18.42

$18.40

0.1

$20.17

$18.91

6.7

(o) 

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 webcast presentation appendix slides for information on select regulatory cases.

Appendix 4-1: EWC Operational Performance Measures

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

Third Quarter

Year-to-Date

2015

2014

% Change

2015

2014

% Change

Owned capacity (MW) (p)

5,463

6,068

(10.0)

5,463

6,068

(10.0)

GWh billed

10,748

11,328

(5.1)

29,918

32,874

(9.0)

As-reported average total revenue per MWh

$48.54

$53.47

(9.2)

$53.60

$63.75

(15.9)

Adjusted average total revenue per MWh (q)

$48.19

$53.11

(9.3)

$53.22

$63.37

(16.0)

Net revenue ($ millions)

410

485

(15.5)

1,287

1,704

(24.5)

As-reported non-fuel O&M per MWh

$23.79

$26.07

(8.7)

$25.16

$26.05

(3.4)

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

$23.63

$25.18

(6.2)

$24.80

$25.21

(1.6)

EWC Nuclear Fleet

Capacity factor

92%

90%

2.2

90%

89%

1.1

GWh billed

9,125

9,950

(8.3)

26,298

29,618

(11.2)

As-reported average total revenue per MWh

$50.41

$53.66

(6.1)

$53.96

$63.34

(14.8)

Adjusted average total revenue per MWh (s)

$49.99

$53.24

(6.1)

$53.53

$62.93

(14.9)

Production cost per MWh

$26.90

$27.37

(1.7)

$26.24

$26.54

(1.1)

Net revenue ($ millions)

395

470

(16.0)

1,242

1,660

(25.2)

Refueling outage days

  FitzPatrick

–

37

–

37

  Indian Point 2

–

–

–

24

  Indian Point 3

–

–

23

–

  Palisades (t)

13

–

13

56

  Pilgrim

–

–

34

–

(p) 

Third quarter and year-to-date 2014 include capacity for VY, which was retired in December 2014 (605 MW).

(q) 

Excluding VY, $55.28/MWh and $62.97/MWh in third quarter and year-to-date 2014 periods.

(r) 

Excluding VY, $24.44/MWh and $24.67/MWh in third quarter and year-to-date 2014 periods.

(s) 

Excluding VY, $55.78/MWh and $62.40/MWh in third quarter and year-to-date 2014 periods.

(t) 

Palisades had 19 refueling outage days in fourth quarter 2015.

See webcast presentation appendix slides for EWC hedging and price disclosures.

Appendix 5: GAAP and Non-GAAP Financial Performance Measures

Third Quarter 2015 vs. 2014

For 12 months ending Sept. 30

2015

2014

Change

GAAP Measures

ROIC – as-reported

1.1%

5.8%

(4.7%)

ROE – as-reported

(1.6%)

9.9%

(11.5%)

Book value per share

$51.33

$56.49

($5.16)

End of period shares outstanding (millions)

178.4

179.6

(1.2)

Non-GAAP Measures

ROIC – operational

5.6%

6.3%

(0.7%)

ROE – operational

9.6%

11.2%

(1.6%)

As of Sept. 30 ($ in millions)

2015

2014

Change

GAAP Measures

Cash and cash equivalents

1,041

1,069

(28)

Revolver capacity

3,869

3,975

(106)

Commercial paper outstanding

664

776

(112)

Total debt

14,144

13,673

471

Securitization debt

814

814

–

Debt to capital ratio

60.2%

56.7%

3.5%

Off-balance sheet liabilities:

Debt of joint ventures – Entergy's share

78

83

(5)

Leases – Entergy's share

422

456

(34)

Power purchase agreements accounted for as leases

224

224

–

Total off-balance sheet liabilities

724

763

(39)

Non-GAAP Measures

Debt to capital ratio, excluding securitization debt

58.7%

55.2%

3.5%

Gross liquidity

4,910

5,044

(134)

Net debt to net capital ratio, excluding securitization debt

56.7%

53.0%

3.7%

Parent debt to total debt ratio, excluding securitization debt

20.9%

19.6%

1.3%

Debt to operational adjusted EBITDA, excluding securitization debt

3.9

3.6

0.3

Operational FFO to debt ratio, excluding securitization debt

25.4%

29.4%

(4.0%)

Appendix 6-1: 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 6-1: 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 (605 MW)

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 at the end of January 2017, excludes energy and capacity from EWC's wind investment accounted for under the equity method of accounting

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 at the end of January 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, 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 6-1: 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

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

AFUDC-borrowed funds

Allowance for borrowed funds used during construction

ISO-NE

ISO New England

LHV

Lower Hudson Valley

LPSC

Louisiana Public Service Commission

AFUDC-equity funds

Allowance for equity funds used during construction

LTM

Last twelve months

MISO

Midcontinent Independent System Operator, Inc.

ADIT

Accumulated deferred income taxes

MPSC

Mississippi Public Service Commission

ALJ

Administrative law judge

NEPOOL

New England Power Pool

ANO

Arkansas Nuclear One (nuclear)

Ninemile 6

Non-fuel O&M

Ninemile Point Unit 6

Non-fuel O&M

APSC

Arkansas Public Service Commission

NRC

NYISO

Nuclear Regulatory Commission

New York Independent System Operator, Inc.

ARO

Asset retirement obligation

BTA

Best technology available

NYPA

New York Power Authority

CCGT

Combined cycle gas turbine

NYS

New York State

CCNO

Council of the City of New Orleans, Louisiana

NYSDEC

New York State Department of Environmental Conservation

COD

Commercial operation date

NYSDOS

CZM

Coastal zone management

NYSE

New York Stock Exchange

DCRF

DOJ

EAI

EBITDA

Distribution cost recovery factor

U.S. Department of Justice

Entergy Arkansas, Inc.

Earnings before interest, income taxes, depreciation and amortization

O&M

Operation and maintenance expense

OCF

Operating cash flow

EEI

Edison Electric Institute

OPEB

Other post-employment benefits

EGSL

Entergy Gulf States Louisiana, L.L.C.

Palisades

Palisades Power Plant (nuclear)

ELL

Entergy Louisiana, LLC

Pilgrim

Pilgrim Nuclear Power Station (nuclear)

EMI

Entergy Mississippi, Inc.

PPA

Power purchase agreement

ENOI

Entergy New Orleans, Inc.

PUCT

Public Utility Commission of Texas

EPA

Environmental Protection Agency

RFO

Refueling outage

EPS

Earnings per share

RFP

Request for proposal

ETI

Entergy Texas, Inc.

RISEC

Rhode Island State Energy Center (CCGT)

ETR

Entergy Corporation

ROE

Return on equity

EWC

Entergy Wholesale Commodities

ROIC

Return on invested capital

FCA

Forward capacity auction

ROS

Rest of state

FERC

Federal Energy Regulatory Commission

RPCE

Rough production cost equalization

FFO

Funds from operations

SEC

U.S. Securities and Exchange Commission

Firm LD

Firm liquidated damages

SEMARI

Southeast Massachusetts/Rhode Island

FitzPatrick

James A. FitzPatrick Nuclear Power Plant

SERI

System Energy Resources, Inc.

FRP

Formula rate plan

SPDES

State Pollutant Discharge Elimination System

GAAP

Generally accepted accounting principles

SPP

Southwest Power Pool

HCM

Human Capital Management program

TCRF

Transmission cost recovery factor

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)

WQC

Water Quality Certification

YOY

Year-over-year

Appendix 7-1: 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)

Third Quarter

Year-to-Date

2015

2014

2015

2014

Utility

As-reported Utility non-fuel O&M

(A)

663,142

617,104

1,889,982

1,727,878

Special Items included in non-fuel O&M:

  HCM implementation expenses

–

681

–

10,202

     Total special items included in non-fuel O&M

(B)

–

681

–

10,202

Operational Utility non-fuel O&M

(A-B)

663,142

616,423

1,889,982

1,717,676

Utility billed sales (GWh)

(C)

35,996

33,504

93,704

90,827

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

(A/C)

18.42

18.42

20.17

19.02

Operational Utility non-fuel O&M per MWh

[(A-B)/(C)]

18.42

18.40

20.17

18.91

EWC

As-reported EWC non-fuel O&M

(D)

255,656

295,375

752,719

856,399

Special Items included in non-fuel O&M:

 Decision to close VY

1,706

9,681

10,774

25,114

  HCM implementation expenses

–

483

–

2,525

     Total special items included in non-fuel O&M

(E)

1,706

10,164

10,774

27,639

Operational EWC non-fuel O&M

(D-E)

253,950

285,211

741,945

828,760

EWC billed sales (GWh)

(F)

10,748

11,328

29,918

32,874

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

(D/F)

23.79

26.07

25.16

26.05

Operational EWC non-fuel O&M per MWh

[(D-E)/(F)]

23.63

25.18

24.80

25.21

As-reported EWC operating revenue

(G)

521,746

605,740

1,603,643

2,095,752

Less Palisades below-market PPA amortization

(H)

3,800

4,124

11,400

12,372

Adjusted EWC operating revenue

(G-H)

517,946

601,616

1,592,243

2,083,380

As-reported EWC nuclear operating revenue

(I)

459,964

533,887

1,419,060

1,876,115

Less Palisades below-market PPA amortization

(H)

3,800

4,124

11,400

12,372

Adjusted EWC nuclear operating revenue

(I-H)

456,164

529,763

1,407,660

1,863,743

As-reported EWC average total revenue per MWh

(G)/(F)

48.54

53.47

53.60

63.75

Adjusted EWC average total revenue per MWh

[(G-H)/(F)]

48.19

53.11

53.22

63.37

EWC nuclear billed sales (GWh)

(J)

9,125

9,950

26,298

29,618

As-reported EWC nuclear average total revenue per MWh

(I)/(J)

50.41

53.66

53.96

63.34

Adjusted EWC nuclear average total revenue per MWh

[(I-H)/(J)]

49.99

53.24

53.53

62.93

VY operational non-fuel O&M

(K)

40,388

115,203

VY operating revenue

(L)

47,824

262,312

VY billed sales

(M)

1,310

3,953

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

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

24.44

24.67

Adjusted EWC average total revenue per MWh excluding VY

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

55.28

62.97

Adjusted EWC nuclear average total revenue per MWh excluding VY

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

55.78

62.40

Totals may not foot due to rounding

Appendix 7-2: Reconciliation of GAAP to Non-GAAP Financial Measures – ROE, ROIC Metrics

($ in millions)     

Third Quarter

2015

2014

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

(A)

(156)

968

Preferred dividends

19

19

Tax effected interest expense

396

383

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

(B)

259

1,370

Special items, rolling 12 months

(21)

(52)

Pilgrim/FitzPatrick asset impairments and related write-offs

(1,063)

–