FirstEnergy 8K Reports 2004 Higher Earnings | FE 15 Feb 05

After-Tax EPS Variance Analysis	4th Qtr.
4Q 2003 Basic EPS - GAAP Basis	$	0.33
Discontinued International Operations		0.11
Unusual Items - 2003		(0.14	)
4Q 2003 Basic EPS - Non-GAAP Basis	$	0.30
Davis-Besse Incremental Expenses - 2003		0.12
4Q 2003 Normalized Earnings - Non-GAAP Basis	$	0.42
Electric Gross Margin		0.12
Nuclear Operating Expense		(0.05	)
Fossil Operating Expense		0.05
Energy Delivery Expenses		0.06
Pension and Other Employee Benefits		0.08
Incentive Compensation		(0.10	)
Other A&G Expenses		0.05
Depreciation and Amortization		0.02
Financing Costs		0.06
Other		0.01
4Q 2004 Normalized Earnings - Non-GAAP Basis	$	0.72
Unusual Charges - 2004		(0.11	)
4Q 2004 Basic GAAP Basis	$	0.61

HIGHLIGHTS

Normalized non-GAAP earnings for the fourth quarter of 2004, excluding unusual charges, were $0.72 per share, compared with fourth quarter 2003 normalized non-GAAP

earnings of $0.42 per share. GAAP earnings were $0.61 per share compared with GAAP earnings of $0.33 per share in the fourth quarter of 2003, which included

discontinued international operations, unusual items and incremental expenses associated with the Davis-Besse outage.

n	Normalized non-GAAP earnings for 2004, excluding unusual charges, were $2.91 per share which exceeded our earnings guidance of $2.70-$2.85 per share. GAAP earnings were $2.68 per share.

4Q 2004 Results vs. 4Q 2003

Electric distribution deliveries increased 3%. Residential and commercial deliveries increased 6% and 4%, respectively, while industrial deliveries were unchanged. Heating-

degree-days were approximately 1% higher than the same period last year, but 4% below normal. Total electric generation sales rose 10% due primarily to a 29% increase in

wholesale sales.

Electric gross margin increased $66 million after adjusting for changes in regulatory deferrals and last year's Davis-Besse replacement power costs. The improvement

resulted from a 12% increase in generation output, along with higher contributions from increased wholesale sales and distribution deliveries.

Nuclear operating expenses, excluding incremental expenses associated with the Davis-Besse outage last year, increased $29 million, due to the refueling outage at

Beaver Valley Unit 1 this quarter.Fossil operating expenses decreased $30 million as a result of fewer planned outages compared to the same period last year.

n	Energy delivery expenses decreased $35 million due to less storm-related maintenance, reduced use of outside contractors, and more capital-related projects this quarter compared to maintenance activities last year.

Forward-Looking Statement: This Form 8-K includes forward-looking statements based on information currently available to management. Such statements are subject to certain risks and uncertainties. These statements typically contain, but are not limited to, the terms "anticipate," "potential," "expect," "believe," "estimate" and similar words. Actual results may differ materially due to the speed and nature of increased competition and deregulation in the electric utility industry, economic or weather conditions affecting future sales and margins, changes in markets for energy services, changing energy and commodity market prices, replacement power costs being higher than anticipated or inadequately hedged, maintenance costs being higher than anticipated, legislative and regulatory changes (including revised environmental requirements), adverse regulatory or legal decisions and outcomes (including revocation of necessary licenses or operating permits, fines or other enforcement actions and remedies) of government investigations, including by the Securities and Exchange Commission, the United States Attorney's Office and the Nuclear Regulatory Commission as disclosed in our Securities and Exchange Commission Filings, generally, and with respect to the Davis-Besse Nuclear Power Station outage in particular, the availability and cost of capital, the continuing availability and operation of generating units, our inability to accomplish or realize anticipated benefits from strategic goals, our ability to improve electric commodity margins and to experience growth in the distribution business, our ability to access the public securities and other capital markets, further investigation into the causes of the August 14, 2003 regional power outage and the outcome, cost and other effects of present and potential legal and administrative proceedings and claims related to the outage, the final outcome in the proceeding related to FirstEnergy's Application for a Rate Stabilization Plan in Ohio, the risks and other factors discussed from time to time in our Securities and Exchange Commission filings and other similar factors. We expressly disclaim any current intention to update any forward-looking statements contained herein as a result of new information, future events, or otherwise.

n	Incentive compensation expense increased $54 million compared to the same period last year. The majority of the increase relates to last year's fourth quarter reversal of nine months of accrued incentive compensation expense, as incentive compensation was not paid in 2003.

n	Other A&G expenses decreased $30 million primarily as a result of reduced legal, customer sales and marketing expenses.

n	Total depreciation and amortization expenses decreased $13 million after adjusting for regulatory deferrals. The reduction was due to the capitalization of carrying charges on regulatory deferrals.

n	Net interest charges decreased $35 million. Financing activities during the quarter included $16 million in mandatory long-term debt redemptions and $143 million of refinancing and repricing transactions.

Consistent with our ongoing efforts to divest non-core assets and businesses, we now anticipate divesting the Facilities Services Group within the year. Thus, the Facilities

Services Group qualified as assets held for sale and we recognized unusual charges of $0.11 per share primarily for asset and goodwill impairments.

2005 Earnings and Cash Generation Guidance*

n	Earnings guidance for 2005, excluding unusual charges, is $2.70 to $2.85 per share. Our estimate for the quarterly pattern of our 2005 earnings guidance are:

1^st Quarter: 15% 2^nd Quarter: 25% 3^rd Quarter: 35% 4^th Quarter: 25%

n	Total cash generation (Non-GAAP) guidance for 2005 is estimated at $560 million.

*The GAAP to Non-GAAP reconciliation statements are attached and available on FirstEnergy Corp.'s website atwww.firstenergycorp.com/ir.

For additional information, please contact:
Kurt E. Turosky	Terrance G. Howson	Thomas C. Navin
Director, Investor Relations	Vice President, Investor Relations	Treasurer
(330) 384-5500	(973) 401-8519	(330) 384-5889

FirstEnergy Corp.
Consolidated Statements of Income
(In thousands except for share amounts)

	Consolidated Statements of Income
			Three Months Ended December 31,									Twelve Months Ended December 31,
			2004			2003			Change			2004			2003			Change
(1)		Revenues
(2)		Electric sales	$	2,500,405	$	2,244,246		$	256,159		$	10,830,606		$	10,205,012		$	625,594
(3)		FE facilities		107,869		84,742			23,127			397,680			327,211			70,469
(4)		MYR		92,930		105,506			(12,576	)		347,416			438,710			(91,294	)
(5)		International		-		3,651			(3,651	)		-			25,482			(25,482	)
(6)		Other		248,687		210,693			37,994			877,344			678,473			198,871
(7)		Total Revenues		2,949,891		2,648,838			301,053			12,453,046			11,674,888			778,158
(8)		Expenses
(9)		Fuel		205,765		200,103			5,662			810,093			763,698			46,395
(10)		Purchased power		748,903		620,679			128,224			3,659,391			3,395,445			263,946
(11)		Other operating expenses		706,467		782,188			(75,721	)		2,798,334			3,004,265			(205,931	)
(12)		FE facilities		117,624		84,215			33,409			401,388			319,721			81,667
(13)		MYR		95,384		113,962			(18,578	)		353,430			444,087			(90,657	)
(14)		International		-		11,151			(11,151	)		-			30,099			(30,099	)
(15)		Mark-to-market adjustment		2,851		5,440			(2,589	)		5,524			(2,110	)		7,634
(16)		Provision for depreciation		148,759		142,574			6,185			589,652			606,436			(16,784	)
(17)		Amortization of regulatory assets		260,833		273,172			(12,339	)		1,166,323			1,079,337			86,986
(18)		Deferral of new regulatory assets		(65,307)		(43,857	)		(21,450	)		(256,795	)		(194,261	)		(62,534	)
(19)		Goodwill Impairment		36,471		-			36,471			36,471			116,988			(80,517	)
(20)		General taxes		163,583		120,014			43,569			677,757			637,967			39,790
(21)		Total Expenses		2,421,333		2,309,641			111,692			10,241,568			10,201,672			39,896
(22)		Claim Settlement		-		167,937			(167,937	)		-			167,937			(167,937	)
(23)		Income Before Interest and Income Taxes		528,558		507,134			21,424			2,211,478			1,641,153			570,325
(24)		Net interest charges:
(25)		Interest expense		166,481		201,970			(35,489	)		670,945			798,911			(127,966	)
(26)		Capitalized interest		(7,295		(8,613	)		1,318			(25,581	)		(31,900	)		6,319
(27)		Subsidiaries' preferred stock dividends		5,389		5,946			(557	)		21,413			42,369			(20,956	)
(28)		Net interest charges		164,575		199,303			(34,728	)		666,777			809,380			(142,603	)
(29)		Income taxes		163,567		159,837			3,730			670,922			407,524			263,398
(30)		Income before discontinued operations and accounting change		200,416		147,994			52,422			873,779			424,249			449,530
(31)		Discontinued operations		1,093		(38,562	)		39,655			4,396			(103,632	)		108,028
(32)		Cumulative effect of accounting change		-		-			-			-			102,147			(102,147	)
(33)		Net Income	$	201,509	$	109,432		$	92,077		$	878,175		$	422,764		$	455,411
(34)
(35)		Basic Earnings Per Common Share:
(36)		Before discontinued operations and accounting change	$	0.61	$	0.45		$	0.16		$	2.67		$	1.40		$	1.27
(37)		Discontinued operations		-		(0.12	)		0.12			0.01			(0.34	)		0.35
(38)		Cumulative effect of accounting change		-		-			-			-			0.33			(0.33	)
(39)		Basic Earnings Per Common Share	$	0.61	$	0.33		$	0.28		$	2.68		$	1.39		$	1.29
(40)		Weighted Average Number of Basic Shares Outstanding		327,706		326,856			850			327,387			303,582			23,805
(41)
(42)		Diluted Earnings Per Common Share:
(43)		Before discontinued operations and accounting change	$	0.61	$	0.45		$	0.16		$	2.66		$	1.40		$	1.26
(44)		Discontinued operations		-	$	(0.12	)		0.12			0.01			(0.34	)		0.35
(45)		Cumulative effect of accounting change		-		-			-			-			0.33			(0.33	)
(46)		Diluted Earnings Per Common Share	$	0.61	$	0.33		$	0.28		$	2.67		$	1.39		$	1.28
(47)		Weighted Average Number of Diluted Shares Outstanding		329,391		328,425			966			328,982			304,972			24,010

FirstEnergy Corp.
Consolidated Income Segments
(in thousands)

		Three Months Ended December 31, 2004
		Regulated Services			Competitive Electric Energy Services			Facilities Services			Other (c)			Reconciling Adjustments				Consolidated
(1)	REVENUES
(2)	Electric sales	$	1,113,103		$	1,387,302		$	-		$	-		$	-		$	2,500,405
(3)	FE facilities		-			-			107,869			-			-			107,869
(4)	MYR		-			-			-			92,930			-			92,930
(5)	International		-			-			-			-			-			-
(6)	Other		232,390			-			-			13,520			2,777	(a)		248,687
(7)	Internal revenues		79,598			-			-			113,821			(193,419	)(b)		-
(8)	Total Revenues		1,425,091			1,387,302			107,869			220,271			(190,642	)		2,949,891
(9)	EXPENSES
(10)	Fuel		-			205,765			-			-			-			205,765
(11)	Purchased power		-			748,903			-			-			-			748,903
(12)	Other operating expenses		475,347			329,766			-			110,425			(209,071	)(a)(b)		706,467
(13)	FE facilities		-			-			117,624			-			-			117,624
(14)	MYR		-			-			-			95,384			-			95,384
(15)	International		-			-			-			-			-			-
(16)	Mark-to-market adjustment		-			5,254			-			(2,403	)		-			2,851
(17)	Provision for depreciation		132,893			8,764			-			7,102			-			148,759
(18)	Amortization of regulatory assets		260,833			-			-			-			-			260,833
(19)	Deferral of regulatory assets		(65,307	)														(65,307	)
(20)	Goodwill Impairment		-			-			36,471			-			-			36,471
(21)	General taxes		139,562			20,446			-			3,575			-			163,583
(22)	Total Expenses		943,328			1,318,898			154,095			214,083			(209,071	)		2,421,333
(23)	Claim settlement		-			-			-			-			-			-
(24)	Income before Interest and Income taxes		481,763			68,404			(46,226	)		6,188			18,429	(b)		528,558
(25)	Net interest charges:
(26)	Interest expense		29,614			39,300			-			79,138			18,429	(b)		166,481
(27)	Capitalized interest		(5,396	)		(1,857	)		-			(42	)		-			(7,295	)
(28)	Subsidiaries' preferred stock dividends		5,389			-			-			-			-			5,389
(29)	Net interest charges		29,607			37,443			-			79,096			18,429			164,575
(30)	Income Taxes		198,412			6,510			(64	)		(41,291	)		-			163,567
(31)	Income before discontinued operations and an accounting change		253,744			24,451			(46,162	)		(31,617	)		-			200,416
(32)	Discontinued operations		-			-			-			1,093			-			1,093
(33)	Cumulative effect of an accounting change		-			-			-			-			-			-
(34)	Net Income	$	253,744		$	24,451		$	(46,162	)	$	(30,524	)	$	-		$	201,509

Reconciling adjustments to segment operating results from internal management reporting to consolidated external financial reporting.
(a) Principally fuel marketing revenues which are reflected as reductions to expenses for internal management reporting purposes.
(b) Elimination of intersegment transactions.
(c) "Other" segment primarily consists of corporate support services, MYR and gas operations.

FirstEnergy Corp.
Consolidated Income Segments
(in thousands)

		Three Months Ended December 31, 2003
		Regulated Services			Competitive Electric Energy Services			Facilities Services			Other (c)			Reconciling Adjustments			Consolidated
(1)	REVENUES
(2)	Electric sales	$	1,084,878		$	1,159,368		$	-		$	-		$	-		$	2,244,246
(3)	FE facilities		-			-			84,742			-			-			84,742
(4)	MYR		-			-			-			105,506			-			105,506
(5)	International		-			-			-			3,651			-			3,651
(6)	Other		161,274			-			-			54,345			(4,926	)(a)		210,693
(7)	Internal revenues		79,530			-			-			140,779			(220,309	)(b)		-
(8)	Total Revenues		1,325,682			1,159,368			84,742			304,281			(225,235	)		2,648,838
(9)	EXPENSES
(10)	Fuel		-			200,103			-			-			-			200,103
(11)	Purchased power		-			620,679			-			-			-			620,679
(12)	Other operating expenses		379,932			368,668			-			241,570			(207,982	)(a)(b)		782,188
(13)	FE facilities		-			-			84,215			-			-			84,215
(14)	MYR		-			-			-			113,962			-			113,962
(15)	International		-			-			-			11,151			-			11,151
(16)	Mark-to-market adjustment		-			5,254			-			186			-			5,440
(17)	Provision for depreciation		124,891			7,144			-			10,539			-			142,574
(18)	Amortization of regulatory assets		273,172			-			-			-			-			273,172
(19)	Deferral of regulatory assets		(43,857	)														(43,857	)
(20)	Goodwill Impairment		-			-			-			-			-			-
(21)	General taxes		99,695			18,585			-			1,973			(239	)		120,014
(22)	Total Expenses		833,833			1,220,433			84,215			379,381			(208,221	)		2,309,641
(23)	Claim settlement		167,937			-			-			-			-			167,937
(24)	Income before Interest and Income taxes		659,786			(61,065	)		527			(75,100	)		(17,014	)		507,134
(25)	Net interest charges:
(26)	Interest expense		122,864			39,011			-			57,109			(17,014	)(b)		201,970
(27)	Capitalized interest		(6,814	)		(1,568	)		-			(231	)		-			(8,613	)
(28)	Subsidiaries' preferred stock dividends		5,946			-			-			-			-			5,946
(29)	Net interest charges		121,996			37,443			-			56,878			(17,014	)		199,303
(30)	Income Taxes		225,914			(40,388	)		1,174			(26,863	)		-			159,837
(31)	Income before discontinued operations and an accounting change		311,876			(58,120	)		(647	)		(105,115	)		-			147,994
(32)	Discontinued operations		-			-			-			(38,562	)		-			(38,562	)
(33)	Cumulative effect of an accounting change		-			-			-			-			-			-
(34)	Net Income	$	311,876		$	(58,120	)	$	(647	)	$	(143,677	)	$	-		$	109,432

Reconciling adjustments to segment operating results from internal management reporting to consolidated external financial reporting.
(a) Principally fuel marketing revenues which are reflected as reductions to expenses for internal management reporting purposes.
(b) Elimination of intersegment transactions.
(c) "Other" segment primarily consists of corporate support services, MYR and gas operations

FirstEnergy Corp.
Consolidated Income Segments
(in thousands)

			Three Months Ended December 31, 2004 vs. Three Months Ended December 31, 2003
				Regulated Services				Competitive Electric Energy Services				Facilities Services				Other (c)				Reconciling Adjustments			Consolidated
(1)	REVENUES
(2)		Electric sales		$	28,225			$	227,934			$	-			$	-			$	-		$	256,159
(3)		FE facilities			-				-				23,127				-				-			23,127
(4)		MYR			-				-				-				(12,576	)			-			(12,576	)
(5)		International			-				-				-				(3,651	)			-			(3,651	)
(6)		Other			71,116				-				-				(40,825	)			7,703	(a)		37,994
(7)		Internal revenues			68				-				-				(26,958	)			26,890	(b)		-
(8)		Total Revenues			99,409				227,934				23,127				(84,010	)			34,593			301,053
(9)		EXPENSES
(10)		Fuel			-				5,662				-				-				-			5,662
(11)		Purchased power			-				128,224				-				-				-			128,224
(12)		Other operating expenses			95,415				(38,902	)			-				(131,145	)			(1,089	)(a)(b)		(75,721	)
(13)		FE facilities			-				-				33,409				-				-			33,409
(14)		MYR			-				-				-				(18,578	)			-			(18,578	)
(15)		International			-				-				-				(11,151	)			-			(11,151	)
(16)		Mark-to-market adjustment			-				-				-				(2,589	)			-			(2,589	)
(17)		Provision for depreciation			8,002				1,620				-				(3,437	)			-			6,185
(18)		Amortization of regulatory assets			(12,339	)			-				-				-				-			(12,339	)
(19)		Deferral of regulatory assets			(21,450	)	#		-		#		-		#		-		#		-			(21,450	)
(20)		Goodwill Impairment			-		#		-		#		36,471		#		-		#		-			36,471
(21)		General taxes			39,867		#		1,861		#		-		#		1,602		#		239			43,569
(22)		Total Expenses			109,495				98,465				69,880				(165,298	)			(850	)		111,692
(23)		Claim Settlement			(167,937	)			-				-				-				-			(167,937	)
(24)		Income before Interest and Income taxes			(178,023	)			129,469				(46,753	)			81,288				35,443	(a)		21,424
(25)		Net interest charges:
(26)		Interest expense			(93,250	)			289				-				22,029				35,443			(35,489	)
(27)		Capitalized interest			1,418				(289	)			-				189				-			1,318
(28)		Subsidiaries' preferred stock dividends			(557	)			-				-				-				-			(557	)
(29)		Net interest charges			(92,389	)			-				-				22,218				35,443			(34,728	)
(30)		Income Taxes			(27,502	)			46,898				(1,238	)			(14,428	)			-			3,730
(31)		Income before discontinued operations and an accounting change			(58,132	)			82,571				(45,515	)			73,498				-			52,422
(32)		Discontinued operations			-				-				-				39,655				-			39,655
(33)		Cumulative effect of an accounting change			-				-				-				-				-			-
(34)		Net Income		$	(58,132	)		$	82,571			$	(45,515	)		$	113,153			$	-		$	92,077

	Reconciling adjustments to segment operating results from internal management reporting to consolidated external financial reporting.
	(a) Principally fuel marketing revenues which are reflected as reductions to expenses for internal management reporting purposes.
		(b) Elimination of intersegment transactions.
	(c) "Other" segment primarily consists of corporate support services, MYR and gas operations.

FirstEnergy Corp.
Financial statements
(in thousands)

Condensed Consolidated Balance Sheet
	As of December 31, 2004		As of December 31, 2003
Assets
Current Assets:
Cash and cash equivalents	$	52,941	$	113,975
Receivables		1,356,437		1,505,500
Other		602,969		623,836
		2,012,347		2,243,311
Property, Plant and Equipment		13,478,356		13,268,922
Investments		3,273,966		3,497,691
Deferred Charges		12,303,275		13,900,024
	$	31,067,944	$	32,909,948

Liabilities and Capitalization
Current Liabilities:
Currently payable long-term debt and preferred stock	$	1,037,349	$	1,754,197
Short-term borrowings		170,489		521,540
Accounts payable		610,589		725,239
Other		1,586,412		1,471,191
		3,404,839		4,472,167
Capitalization:
Common stockholders' equity		8,589,294		8,289,341
Preferred stock not subject to mandatory redemption		238,719		335,123
Long-term debt and other long-term obligations		10,013,349		9,789,066
		18,841,362		18,413,530
Noncurrent Liabilities		8,821,743		10,024,251
	$	31,067,944	$	32,909,948

Adjusted Capitalization (including Off-Balance Sheet Items)
		As of December 31,
		2004	% Total			2003	% Total
Total common equity	$	8,589,294	42	%	$	8,289,341	37	%
Preferred stock *		238,719	1	%		335,123	2	%
Long-term debt – all other*		10,013,349	49	%		11,543,263	52	%
Short-term debt		170,489	1	%		521,540	2	%
Off-balance sheet debt equivalents:
– Sale-leaseback net debt equivalents		1,358,221	7	%		1,414,541	6	%
– Accounts receivable factoring		84,000	0	%		200,000	1	%
Total	$	20,454,072	100	%	$	22,303,808	100	%

* Includes amounts due to be paid within one year, JCP&L securitization of $281 million and $296 million in 2004 and 2003, respectively.

GENERAL INFORMATION	Three Months Ended December 31,					Twelve Months Ended December 31,
	2004			2003		2004			2003

L-T Debt and Preferred Stock Redemptions	$	24,686		$	792,112	$	1,573,830		$	2,255,654
New L-T Debt Issues	$	-		$	255,675	$	961,474		$	1,027,312
Short-term Debt Increase (Decrease)	$	(132,019	)	$	271,343	$	(351,051	)	$	(575,391	)
Capital Expenditures	$	300,478		$	276,247	$	846,221		$	856,316

FirstEnergy Corp.
Financial Statements
(in thousands)

Condensed Consolidated Statements of Cash Flows
	Three Months Ended December 31,						Twelve Months Ended December 31,
	2004			2003			2004			2003
Cash flows from operating activities:
Net income	$	201,509		$	109,432		$	878,175		$	422,764
Adjustments to reconcile net income to net cash from operating activities:
Depreciation and amortization of regulatory assets, nuclear fuel and leases		368,587			390,242			1,595,264			1,557,584
Deferred costs recoverable as regulatory assets		(153,327	)		(124,441	)		(416,617	)		(427,092	)
Deferred income taxes and investment tax credits		315,258			134,001			258,263			53,639
Goodwill and investment impairments		54,368			43,803			54,368			160,791
Pension trust contribution		-			-			(500,000	)		-
Disallowed regulatory assets		-			-			-			152,500
Cumulative effect of accounting change		-			-			-			(174,663	)
Loss (income) from discontinued operations		(1,093	)		38,562			(4,396	)		103,632
Change in working capital and other		(443,740	)		(141,677	)		11,793			(94,300	)
	$	341,562		$	449,922		$	1,876,850		$	1,754,855
Cash flows from financing activities		(41,573	)		(394,768	)		(1,456,676	)		(1,298,266	)
Cash flows from investing activities:		(314,940	)		(181,073	)		(481,208	)		(568,546	)

Net increase (decrease) in cash and cash equivalents	$	(14,951	)	$	(125,919	)	$	(61,034	)	$	(111,957	)
Cash and cash equivalents at beginning of period		67,892			239,894			113,975			225,932
Cash and cash equivalents at end of period	$	52,941		$	113,975		$	52,941		$	113,975

REGULATORY DEFERRALS		Three Months Ended December 31,									Twelve Months Ended December 31,
		2004			2003			Change			2004			2003			Change
Ohio Transition Plan
Beginning Balance	$	644,888		$	409,758					$	453,400		$	259,354
Deferral of Shopping Incentives		56,012			41,904		$	14,108			210,151			181,229		$	28,922
Deferral of New Regulatory Assets		9,295			1,953			7,342			46,644			13,032			33,612
Current period deferrals	$	65,307		$	43,857		$	21,450		$	256,795		$	194,261		$	62,534

Ending Balance-Ohio Deferrals	$	710,195		$	453,615					$	710,195		$	453,615

Deferred Energy Costs – New Jersey
Beginning Balance	$	404,400		$	444,117					$	440,900		$	548,641
Deferral (recovery) of energy costs		36,600			(3,217	)	$	39,817			100			57,844		$	(57,744	)
Rate case disallowance		-			-			-			-			(165,585	)		165,585
Current period change	$	36,600		$	(3,217	)	$	39,817		$	100		$	(107,741	)	$	107,841

Ending Balance	$	441,000		$	440,900					$	441,000		$	440,900


UNUSUAL ITEMS	Three Months Ended December 31,									Twelve Months Ended December 31,
		2004			2003			Change			2004			2003			Change
Non-Core Asset Sales / Impairments	$	(805	)	$	(37,174	)	$	36,369		$	(13,316	)	$	(55,937	)	$	42,621
FENOC Severance		-			-			-			(6,488	)		-			(6,488	)
Lawsuits Settlement		-			-			-			(17,980	)		-			(17,980	)
Facilities Services Impairment		(47,440	)		-			(47,440	)		(47,440	)		(116,988	)		69,548
JCP&L Rate Case Disallowance		-			(13,635	)		13,635			-			(185,241	)		185,241
Environmental Liability		-			(14,500	)		14,500			-			(14,500	)		14,500
Claim Settlement		-			167,937			(167,937	)		-			167,937			(167,937	)
Total - Pre-tax Amounts	$	(48,245	)	$	102,628		$	(150,873	)	$	(85,224	)	$	(204,729	)	$	119,505

EPS Effect		($0.11	)	$	0.14			($0.25	)		($0.23	)		($0.47	)	$	0.24

FirstEnergy Corp.
Statistical Summary


ELECTRIC SALES STATISTICS	Three Months Ended December 31								Twelve Months Ended December 31
(kWh in millions)	2004			2003		Change			2004		2003		Change
Electric Generation Sales
Retail - Regulated		19,853			19,231		3.2	%		81,140		82,408		-1.5	%
Retail - Competitive		3,369			3,629		-7.2	%		14,934		14,230		4.9	%
Total Retail		23,222			22,860		1.6	%		96,074		96,638		-0.6	%
Wholesale		12,511			9,673		29.3	%		53,268		42,059		26.7	%
Total Electric Generation Sales		35,733			32,533		9.8	%		149,342		138,697		7.7	%

Electric Distribution Deliveries
Ohio - Residential		4,095			3,734		9.7	%		16,209		16,032		1.1	%
- Commercial		3,573			3,411		4.7	%		14,583		14,277		2.1	%
- Industrial		5,581			5,655		-1.3	%		23,097		23,160		-0.3	%
- Other		77			99		-22.2	%		356		391		-9.0	%
Total Ohio		13,326			12,899		3.3	%		54,245		53,860		0.7	%

Pennsylvania - Residential		2,726			2,632		3.6	%		10,871		10,572		2.8	%
- Commercial		2,522			2,511		0.4	%		10,342		10,065		2.8	%
- Industrial		2,576			2,543		1.3	%		10,203		9,953		2.5	%
- Other		21			21		0.0	%		80		84		-4.8	%
Total Pennsylvania		7,845			7,707		1.8	%		31,496		30,674		2.7	%

New Jersey - Residential		2,015			1,980		1.8	%		9,355		9,104		2.8	%
- Commercial		2,134			1,975		8.1	%		8,877		8,620		3.0	%
- Industrial		763			732		4.2	%		3,070		3,046		0.8	%
- Other		22			20		10.0	%		74		89		-16.9	%
Total New Jersey		4,934			4,707		4.8	%		21,376		20,859		2.5	%

Total Residential		8,836			8,346		5.9	%		36,435		35,708		2.0	%
Total Commercial		8,229			7,897		4.2	%		33,802		32,962		2.5	%
Total Industrial		8,920			8,930		-0.1	%		36,370		36,159		0.6	%
Total Other		120			140		-14.3	%		510		564		-9.6	%
Total Distribution Deliveries		26,105			25,313		3.1	%		107,117		105,393		1.6	%

Electric Sales Shopped
Ohio - Residential		1,806			1,451		24.5	%		7,158		6,377		12.2	%
- Commercial		1,743			1,529		14.0	%		7,112		6,501		9.4	%
- Industrial		1,130			1,106		2.2	%		4,549		4,903		-7.2	%
Total Ohio		4,679			4,086		14.5	%		18,819		17,781		5.8	%

Pennsylvania - Residential		6			7		-14.3	%		24		31		-22.6	%
- Commercial		24			41		-41.5	%		122		252		-51.6	%
- Industrial		433			698		-38.0	%		1,944		2,848		-31.7	%
Total Pennsylvania		463			746		-37.9	%		2,090		3,131		-33.2	%

New Jersey - Residential		17			254		-93.3	%		488		423		15.4	%
- Commercial		508			534		-4.9	%		2,315		805		187.6	%
- Industrial		585			462		26.6	%		2,265		845		168.0	%
Total New Jersey		1,110			1,250		-11.2	%		5,068		2,073		144.5	%

Total Electric Sales Shopped		6,252			6,082		2.8	%		25,977		22,985		13.0	%

		Twelve Months Ended December 31,
OPERATING STATISTICS		2004					2003
System Load Factor		66.7	%				64.7	%
Capacity Factors:
Fossil		57.7	%				58.3	%
Nuclear		90.5	%				64.1	%
Generation Output:
Fossil		60	%				68	%
Nuclear		40	%				32	%

Weather		2004			Normal		2003
Composite Heating-Degree-Days
4th Quarter		1,877			1,962		1,869
Year-to-Date		5,456			5,550		5,745
Composite Cooling-Degree-Days
4th Quarter		8			12		9
Year-to-Date		902			880		810

FirstEnergy Corp.
2004 EPS and Cash Flow

2004 Earnings Per Share (EPS) (Reconciliation of GAAP to Non-GAAP)
		Three Months Ended December 31		Twelve Months Ended December 31		Annual Guidance
Basic EPS (GAAP Basis)	$	0.61	$	2.68	$	2.47 - $2.62
Unusual Charges:
Non-core Asset Sales / Impairments		0.11		0.19		0.19
FENOC Severance		0.00		0.01		0.01
Lawsuits Settlement		0.00		0.03		0.03
EPS Basis (Non-GAAP Basis) *	$	0.72	$	2.91	$	2.70 - $2.85

* Earnings for 2004 includes the incremental expenses associated with the Davis-Besse outage and the impact resulting from approval of the Ohio Rate Stabilization Plan.

Reconciliation of 2004 Estimated Cash From Operating Activities (GAAP) to Estimated Free Cash Flow (Non-GAAP) and Estimated Cash Generation (Non-GAAP) (in millions)
Net Cash from Operating Activities:
Net Income	$	878
Adjustments:
Depreciation		590
Amortization		996
Deferred costs recoverable as regulatory assets		(417	)
Deferred income taxes and ITC, net		59
Pension plan contribution, net of tax¹		(300	)
Other, including changes in working capital²		71
Net Cash from Operating Activities (GAAP)	$	1,877

Other Items:
Capital expenditures		(756	)
Nuclear fuel fabrication		(90	)
Decommissioning		(100	)
Common stock dividends		(490	)
NUG trust contributions		(50	)
Claim settlement²		(100	)
Pension plan contribution, net of tax¹		300
Miscellaneous		295
Free Cash Flow (Non-GAAP)	$	886

Claim settlement²		100
Pension plan contribution, net of tax		(300	)
Miscellaneous asset sales / other		134
Cash Generation (Non-GAAP)	$	820

Notes:
¹On a Non-GAAP basis, we are reducing "Free Cash Flow" to exclude the after-tax pension.

²On a GAAP basis, the $100 million after-tax cash benefit from the claim settlement is reflected in "Other, including changes in working capital." Since we do not consider this one-time settlement to be part of "Free Cash Flow," we removed it from the subtotal and then added it back to include it as a component of "Cash Generation."

Reconciliation of 2005 Estimated Cash From Operating Activities (GAAP) to Estimated Free Cash Flow (Non-GAAP) and Estimated Cash Generation (Non-GAAP) (in millions)
Net Cash from Operating Activities:
Non-GAAP Earnings Guidance	$	887-$937
Adjustments:
Depreciation		608
Amortization		1,061
Deferred costs recoverable as regulatory assets		(425	)
Deferred income taxes and ITC, net		(170	)
Other, including changes in working capital		104
Net Cash from Operating Activities (GAAP)	$	2,090

Other Items:
Capital expenditures		(1,003	)
Nuclear fuel fabrication		(90	)
Decommissioning		(100	)
Common stock dividends		(542	)
NUG trust contributions		20
Miscellaneous		25
Free Cash Flow (Non-GAAP)	$	400

Miscellaneous asset sales / other		160
Cash Generation (Non-GAAP)	$	560

਍

RECENT DEVELOPMENTS

Common Stock Dividend Increase

On November 30, FirstEnergy Corp.'s Board of Directors declared a quarterly dividend of 41.25 cents per share of outstanding common stock, a 10 percent increase over the previous quarterly rate of 37.5 cents per share, payable March 1, 2005. With the increase, the new indicated annual dividend will be $1.65 per share. Additionally, the Board adopted a dividend policy that will target sustainable annual dividend increases after 2005 that generally reflect an annual growth rate of 4% to 5%, and an earnings payout ratio generally within the range of 50% to 60%. The Board will continue to review FirstEnergy's dividend policy regularly.

Record Generation Output

In 2004, FirstEnergy set a new generation output record of 76.4 million megawatt-hours in spite of Davis-Besse being out of service for the first three months of the year. The 6% increase in output, compared to the previous record of 72.1 million megawatt-hours established in 2002, was attributable to higher nuclear generation, which set a record of 29.9 million-megawatt hours and continued strong performance from our baseload fossil plants.

Nuclear Update

On November 14, Beaver Valley Unit 1 completed its 16^th refueling outage. The refueling outage lasted 28 days and was the Unit's shortest ever.

On February 1, the Perry Plant returned to service following a 26-day forced outage that was initiated by a downshift to slow speed of the reactor recirculation system and a subsequent trip of one of the pumps. In addition to resolution of the intermittent electrical problem that caused the outage, minor modifications were made to resolve a circuit breaker problem in a motor driven feed pump and to install heat shields and insulation to the emergency diesel generation exhaust system.

On February 9, Davis-Besse returned to service following the completion of its mid-cycle outage. During the outage, plant personnel completed inspections of the reactor vessel head and under vessel area. The inspections showed no indications of leakage. The inspections of the reactor coolant pumps indicated both will support safe, reliable operations into the Spring 2006 refueling, when they will be refurbished. Minor repair work was completed on steam generator tubes.

The Perry Plant refueling outage is scheduled to commence later this month, while Beaver Valley Unit 2's refueling outage is scheduled to begin in early April.

Competitive Bid Process

On December 8, National Economic Research Associates conducted the retail load auction for FirstEnergy's Ohio operating companies. On December 9, The Public Utilities Commission of Ohio (PUCO) rejected the final auction price for FirstEnergy’s operating companies retail load. The Commission found that the clearing price of 5.45 cents per kilowatt-hour was inadequate in comparison to the price available through FirstEnergy’s rate stabilization plan. As a result, subject to appeal, the modified rate stabilization plan approved for FirstEnergy will be implemented on January 1, 2006.

Update on Labor Negotiations

On December 8, Jersey Central Power & Light (JCP&L) implemented its work continuation plan in response to a strike of approximately 1,350 employees (approximately 850 field employees and 500 office staff) represented by International Brotherhood of Electrical Workers System Council U-3. The strike is the first since 1987 for JCP&L. Key issues involved employee wages, benefits and work rules, especially those related to adequate employee response to meet customers' service needs. Non-represented employees from JCP&L are performing service reliability and priority maintenance work, with assistance from operating companies in Ohio and Pennsylvania, while the union is on strike. Settlement discussions between JCP&L and the union are ongoing.

On January 31, the International Brotherhood of Electrical Workers Local 245, representing 550 employees, ratified a three-year contract agreement with Toledo Edison, FirstEnergy Nuclear Operating Company, and FirstEnergy Generation Corp. On February 4, the International Brotherhood of Electrical Workers Local 272, representing approximately 350 Bruce Mansfield employees, ratified a three-year contract with FirstEnergy Generation Corp. Both agreements reflect an average annual three-percent wage increase.

Governmental Investigations and Legal Proceedings

On December 10, 2004, FirstEnergy received a letter from the US Attorney's Office stating that FENOC is a target of the federal grand jury investigation into alleged false statements relating to the Davis-Besse outage made to the NRC in the Fall of 2001 in response to NRC Bulletin 2001-01. The letter also said that the designation of FENOC as a target indicates that, in the view of the prosecutors assigned to the matter, it is likely that federal charges will be returned against FENOC by the grand jury. FirstEnergy is unable to predict the outcome of this investigation.

FirstEnergy previously reported on the formal investigation by the SEC’s Division of Enforcement relating to the August 2003 restatements of previously reported results by FirstEnergy and certain of its Ohio utility subsidiaries, the Davis-Besse extended outage and issues raised during the SEC's examination of FirstEnergy and its subsidiaries under the Public Utility Holding Company Act of 1935 (PUHCA). On December 30, 2004, FirstEnergy received a second subpoena asking for documents relating to issues raised during the PUHCA examination. FirstEnergy has cooperated fully with these investigations and will continue to do so.

If it were ultimately determined that FirstEnergy or its subsidiaries have legal liability or are otherwise made subject to liability based on any of the above matters, it could have a material adverse effect on FirstEnergy's or its subsidiaries' financial condition and results of operations.

Forward-Looking Statements: This discussion includes forward-looking statements based on information currently available to management. Such statements are subject to certain risks and uncertainties. These statements typically contain, but are not limited to, the terms "anticipate," "potential," "expect," "believe," "estimate" and similar words. Actual results may differ materially due to the speed and nature of increased competition and deregulation in the electric utility industry, economic or weather conditions affecting future sales and margins, changes in markets for energy services, changing energy and commodity market prices, replacement power costs being higher than anticipated or inadequately hedged, maintenance costs being higher than anticipated, legislative and regulatory changes (including revised environmental requirements), adverse regulatory or legal decisions and outcomes (including revocation of necessary licenses or operating permits, fines or other enforcement actions and remedies) of government investigations, including by the Securities and Exchange Commission, the United States Attorney's Office and the Nuclear Regulatory Commission as disclosed in our Securities and Exchange Commission filings, generally, and with respect to the Davis-Besse Nuclear Power Station outage in particular, the availability and cost of capital, the continuing availability and operation of generating units, our inability to accomplish or realize anticipated benefits from strategic goals, our ability to improve electric commodity margins and to experience growth in the distribution business, our ability to access the public securities and other capital markets, further investigation into the causes of the August 14, 2003 regional power outage and the outcome, cost and other effects of present and potential legal and administrative proceedings and claims related to the outage, the final outcome in the proceeding related to FirstEnergy's Application for a Rate Stabilization Plan in Ohio, the risks and other factors discussed from time to time in our Securities and Exchange Commission filings, and other similar factors. We expressly disclaim any current intention to update any forward-looking statements contained herein as a result of new information, future events, or otherwise.

FirstEnergy (FE) 8-KFirstenergy Reports 2004 Higher Earnings