Entergy
639 Loyola Avenue
New Orleans, LA 70113
Exhibit 99.2
Date: January 31, 2002
For Release: Immediately
Contact: Morgan Stewart (News Media)
(504) 576-4238
mstewa3@entergy.com
Nancy Morovich (Investor Relations)
(504) 576-5506
(888) 925-8406 (pager)
nmorovi@entergy.com
Entergy Reports Record Earnings for the Year 2001
New Orleans, La. - Entergy Corporation (NYSE:ETR) today announced that
earnings for the year 2001 were $3.23 per share, or $726.2 million, compared
with $2.97, or $679.3 million, in 2000. On an operational basis, 2001 earnings
were $3.23 compared to $3.12 for the year 2000. Earnings for the year 2001
broke the record for annual earnings set by the company just one year ago.
While fourth quarter 2001 earnings were down from the same period of
2000, primarily as a result of mild weather, Entergy's earnings marked the
15th consecutive quarter in which the company exceeded the consensus estimate
of financial analysts. Entergy's fourth quarter 2001 consolidated earnings
were 9 cents per share, compared with 19 cents per share in fourth quarter
2000.
On an operational basis, Entergy's fourth quarter 2001 earnings were
$39.8 million, or 18 cents per share, compared with $70.9 million, or 31
cents per share, in the year-earlier period. Extremely cold weather in fourth
quarter 2000 accounted for 14 cents of the earnings per share for that
period. When results for both periods are adjusted for changes in weather,
fourth quarter 2001 results were 18 percent higher than one year ago. The
18 percent increase in weather-adjusted operational earnings was driven by
solid results at the utility, as well as the non-utility nuclear business,
Entergy Nuclear, which is not subject to state and local regulation.
"Difficult economic conditions, weak commodity prices and some of the
mildest weather in over 100 years did not deter us from achieving outstanding
results in 2001," said J. Wayne Leonard, Entergy's chief executive officer.
"We continue to create value for all of our stakeholders through our
conservative integrated strategy combined with operational excellence and
financial strength."
Leonard highlighted achievements in each of the company's three
businesses:
- "The utility delivered solid earnings without help from the weather
by achieving operating efficiencies, while continuing to improve on
measures of safety, reliability and customer service.
- The nuclear business continued to grow, with the acquisition of
Indian Point 2 and an agreement to acquire Vermont Yankee. We
completed scheduled refueling outages at several units in record time.
- The Energy Commodity Services business, which includes Entergy-Koch
and Entergy Wholesale Operations, delivered good results in both the
trading and pipeline operations even though forces in the market
pressured prices and margins."
Utility Operations
In fourth quarter 2001, utility earnings on an operational basis were
$44.5 million, or 20 cents per share, equal to the 20 cents per share earned
in the same period of 2000. Mild weather in the fourth quarter of 2001 had
a minimal impact on earnings, compared with much colder-than-normal weather
for the same period of 2000, which accounted for 14 cents of that quarter's
20 cents in earnings.
Mild weather in the fourth quarter 2001, combined with the continued
slowdown in the economy, reduced usage across most retail customer segments
from year-earlier levels. Residential sales declined by 11 percent,
commercial sales by 1 percent, and industrial sales by 4 percent (after
adjusting for the effect of reclassifying certain industrial customers from
retail to wholesale). The impact of reduced sales and net revenues was
partially offset by lower expenses in 2001. Operation and maintenance
expenses per megawatt-hour generated were down 5 percent for the quarter.
For the year 2001, the utility earned $2.46 per share on an operational
basis, compared with $2.65 in 2000. The higher earnings in 2000 were due to
extreme weather. On a weather-adjusted basis, 2001 earnings improved by
6 percent over 2000 results.
The utility continued to improve reliability and customer service, as
evidenced by a reduction of 53 percent in the number of reliability
complaints to regulators in fourth quarter 2001 compared with the
year-earlier period. Twelve-month-ended measures of average outage frequency
and average outage duration decreased by 5 percent and 6 percent,
respectively. These improvements were achieved with continued increases
in safety, as indicated by a continued reduction in lost-time accidents
for the year.
Competitive Non-Regulated Businesses
Entergy's competitive businesses contributed operational earnings of
$31.5 million, or 15 cents per share, an increase of 25 percent from 12
cents per share in fourth quarter 2000. On an as-reported basis, the
competitive businesses earned 9 cents per share in fourth quarter 2001,
compared to 12 cents a year earlier. Fourth quarter 2001 results include
several special items which reduced income by 6 cents. These special items
reflect charges taken for the anticipated loss in connection with the
planned sale of Latin American assets and severance and restructuring costs
incurred at Entergy Wholesale Operations. Partially offsetting these
charges was a gain associated with recording the cumulative effect of
applying mark to marketing accounting to the Damhead Creek gas contract
and a true-up to the gain previously recognized on the sale of the
Saltend project.
For the year 2001, the competitive businesses had operational income
of $212.4 million, or 95 cents per share, compared to $90.8 million, or
40 cents per share in 2000. The increase in earnings is due primarily to
the growth in the non-utility nuclear business combined with very solid
performance from Entergy-Koch L.P.
Entergy Nuclear earned $28.9 million, or 13 cents per share, compared
to $19.1 million, or 9 cents per share, in fourth quarter 2000. The
increase was due primarily to increased revenue resulting from the
contribution for the full quarter in 2001 of the Indian Point 2 and
Indian Point 3 nuclear units in Buchanan, N.Y., and FitzPatrick nuclear
unit in Lycoming, N.Y. Entergy Nuclear's average capacity factor was 95.4
percent for fourth quarter 2001, a slight improvement over the already
excellent performance achieved in fourth quarter 2000. Its net capacity
in operation increased by 39 percent over one year ago, and it generated
139 percent more power during fourth quarter 2001 than in the comparable
period of 2000.
For the full year, Entergy Nuclear had operational earnings of
$127.9 million, or 57 cents, compared to $49.2 million, or 22 cents for
the year 2000. The 159 percent increase in earnings is due to a full
year of operations at Indian Point 3 and FitzPatrick and the contribution
of Indian Point 2 since its acquisition in September 2001.
Energy Commodity Services, the combined reporting of Entergy-Koch L.P. and
Entergy Wholesale Operations, contributed operational earnings of $2.5
million, or 2 cents per share, compared with $6.2 million, or 3 cents per
share, in fourth quarter 2000. On an as-reported basis, Energy Commodity
Services recorded a loss of $9.8 million, or 4 cents per share, in fourth
quarter 2001, compared to income of $6.2 million, or 3 cents per share,
in the same period last year. Entergy Wholesale Operations recorded the
special item of 6 cents per share, as explained above.
Entergy-Koch Trading contributed operational earnings through both its
power and gas trading during fourth quarter in spite of the negative effects
of reduced market volatility and very mild weather. The Gulf South pipeline
realized lower earnings in fourth quarter 2001 due primarily to a 3 percent
decrease in pipeline throughput and lower levels of gas storage activity
associated with milder-than-normal temperatures. As of the end of fourth
quarter 2001, Entergy Wholesale Operations had 2,410 net megawatts of
generating capacity in operation, an increase of 99 percent for the year.
For the full year, Energy Commodity Services earned $84.5 million,
or 38 cents per share, in operational earnings, compared to $41.6 million,
or 18 cents per share, in 2000. The growth in earnings year over year
primarily resulted from the strong performance of the trading and gas
pipeline businesses of Entergy-Koch L.P., which began operations in
February 2001.
Parent & Other
Parent & Other had a loss of 20 cents in fourth quarter 2001,
compared with a loss of 13 cents in fourth quarter 2000. The increased
loss in fourth quarter 2001 was due primarily to higher income tax
benefits being allocated from Parent to Entergy subsidiaries for the 2001
period. These tax benefits are allocated in accordance with Entergy's
consolidated tax allocation agreement, which is required of all public
utility holding companies pursuant to Securities and Exchange Commission
regulation. Also, higher levels of interest expense negatively impacted
Parent & Other results in 2001 compared to 2000. Fourth quarter 2001
results included an adjustment that increased the Parent's loss by 3
cents per share, treated as a special item, for the write-off of costs
associated with the e-commerce investment MyHomeKey.
For the full year, Parent & Other had an operational loss of
$39.3 million, or 18 cents per share, in 2001, compared with income of
$16.2 million, or 7 cents per share, in 2000. Results in 2001 reflect the
impact of significantly higher tax benefits allocated from the Parent to
other Entergy subsidiaries. This combined with lower cash balances and the
resulting decrease in interest income, as well as higher interest expense,
unfavorably impacted the Parent's results in 2001.
Outlook
"The year 2001 reflected a steady growth in the financial results
across our businesses," said C. John Wilder, Entergy's chief financial
officer. "Excellent results were achieved during a difficult year for
the energy markets and the overall economy. Based on the fundamental
strength of our company we are raising our 2002 guidance to $3.40 to
$3.60, exclusive of the impact of weather."
Entergy Corporation, with annual revenues of nearly $10 billion, is
a major global energy company engaged in power production, distribution
operations, and related diversified services, with more than 14,000
employees. Entergy owns, manages, or invests in power plants generating
more than 30,000 megawatts of electricity domestically and internationally,
and delivers electricity to about 2.6 million customers in portions of
Arkansas, Louisiana, Mississippi, and Texas. Through Entergy-Koch, L.P.,
it is also a leading provider of wholesale energy marketing and trading
services.
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Entergy's online address is www.entergy.com
The following constitutes a "Safe Harbor" statement under the Private
Securities Litigation Reform Act of 1995: Investors are cautioned that
forward-looking statements contained herein with respect to the revenues,
earnings, performance, strategies, prospects and other aspects of the
business of Entergy Corporation, Entergy Arkansas, Inc., Entergy Gulf States,
Inc., Entergy Louisiana, Inc., Entergy Mississippi, Inc., Entergy New
Orleans, Inc., and System Energy Resources, Inc. and their affiliated
companies may involve risks and uncertainties. A number of factors could
cause actual results or outcomes to differ materially from those indicated
by such forward-looking statements. These factors include, but are not
limited to, risks and uncertainties relating to: the effects of weather,
the performance of generating units and transmission systems, the possession
of nuclear materials, fuel and purchased power prices and availability, the
effects of regulatory decisions and changes in law, litigation, capital
spending requirements, the onset of competition, including the ability to
recover net regulatory assets and other potential stranded costs, the
effects of recent developments in the California electricity market on
the utility industry nationally, advances in technology, changes in
accounting standards, corporate restructuring and changes in capital
structure, the success of new business ventures, changes in the markets
for electricity and other energy-related commodities, changes in interest
rates and in financial and foreign currency markets generally, the economic
climate and growth in Entergy's service territories, changes in corporate
strategies, and other factors.
ENTERGY CORPORATION
Earnings at a glance
Fourth Quarter 2001 2000 %
Operating Revenues $1,885.31 $2,634.33 (28.4)
As Reported Earnings $ 20.65 $ 43.31 (52.3)
As Reported Earnings per
diluted share* $ 0.09 $ 0.19 (52.6)
Operational Earnings per
diluted share $ 0.18 $ 0.31 (41.9)
*Includes Special Items (EPS):
EWO severance costs $ (0.02) $ -
Damhead Creek gas contract 0.10 -
Gain (loss) on disposition of assets - net (0.17) (0.12)
------- ------
Total ($ 0.09) $(0.12)
======= ======
Year to Date 2001 2000 %
Operating Revenues $9,620.90 $10,022.13 (4.0)
As Reported Earnings $ 726.20 $ 679.29 6.9
As Reported Earnings per
diluted share* $ 3.23 $ 2.97 8.8
Operational Earnings per
diluted share $ 3.23 $ 3.12 3.5
*Includes Special Items (EPS):
Merger expenses $(0.06) $ -
EWO severance costs (0.02) -
Damhead Creek gas contract 0.10 -
Gain (loss) on disposition of assets - net (0.02) (0.06)
Regulatory & reserve adjustments - (0.09)
------ ------
Total $ - $(0.15)
====== ======
Note - dollars in millions except per share amounts, which are actual.
Entergy Corporation
Consolidated Income Statement
Three Months Ended December 31
(in thousands)
2001 2000 % Inc/(Dec)
(unaudited)
Operating Revenues:
Domestic electric $1,395,107 $1,817,029 (23.2)
Natural gas 26,758 69,765 (61.6)
Competitive businesses 463,442 747,538 (38.0)
---------- ----------
Total 1,885,307 2,634,332 (28.4)
---------- ----------
Operating Expenses:
Operation and maintenance:
Fuel, fuel-related expenses,
and gas purchased for resale 604,745 888,864 (32.0)
Purchased power 132,597 632,672 (79.0)
Nuclear refueling outage expenses 24,578 16,887 45.5
Other operation and maintenance 694,835 611,801 13.6
Decommissioning 7,938 10,873 (27.0)
Taxes other than income taxes 104,132 103,997 0.1
Depreciation and amortization 206,933 200,136 3.4
Other regulatory charges (credits) - net (16,018) (23,630) (32.2)
Amortization of rate deferrals 1,402 4,616 (69.6)
---------- ----------
Total 1,761,142 2,446,216 (28.0)
---------- ----------
Operating Income 124,165 188,116 (34.0)
---------- ----------
Other Income (Deductions):
Allowance for equity funds used during
construction 6,950 7,124 (2.4)
Gain (loss) on sales of assets - net 2,966 744 298.7
Interest and dividend income 35,511 44,424 (20.1)
Equity in earnings of unconsolidated equity affiliates 18,238 983 1,755.3
Miscellaneous - net (17,151) (10,801) 58.8
---------- ----------
Total 46,514 42,474 9.5
---------- ----------
Interest and Other Charges:
Interest on long-term debt 158,547 123,487 28.4
Other interest - net 13,887 19,408 (28.4)
Dividends on preferred securities of subsidiaries 4,709 4,709 -
Allowance for borrowed funds used during
construction (5,701) (5,361) 6.3
---------- ----------
Total 171,442 142,243 20.5
---------- ----------
Income Before Income Taxes (763) 88,347 (100.9)
Income Taxes (3,880) 38,304 (110.1)
---------- ----------
Income Before Cumulative Effect of an Accounting Change 3,117 50,043 (93.8)
Cumulative Effect of an Accounting Change (net of income taxes) 23,482 - -
---------- ----------
Consolidated Net Income 26,599 50,043 (46.8)
Preferred dividend requirements of subsidiaries and other 5,948 6,735 (11.7)
---------- ----------
Earnings Applicable to Common Stock $20,651 $43,308 (52.3)
========== ==========
Earnings Per Average Common Share:
Basic $0.09 $0.20 (55.0)
Diluted $0.09 $0.19 (52.6)
Average Number of Common Shares Outstanding:
Basic 221,050,278 219,582,366
Diluted 224,583,984 223,919,460
Entergy Corporation
Consolidated Income Statement
Twelve Months Ended December 31
(in thousands)
2001 2000 % Inc/(Dec)
(unaudited)
Operating Revenues:
Domestic electric $7,244,827 $7,219,686 0.3
Natural gas 185,902 165,872 12.1
Competitive businesses 2,190,170 2,636,571 (16.8)
---------- ----------
Total 9,620,899 10,022,129 (4.0)
---------- ----------
Operating Expenses:
Operation and maintenance:
Fuel, fuel-related expenses,
and gas purchased for resale 3,681,677 2,645,835 39.1
Purchased power 1,021,432 2,662,881 (61.6)
Nuclear refueling outage expenses 89,145 70,511 26.4
Other operation and maintenance 2,151,742 1,943,814 10.7
Decommissioning 3,189 39,484 (91.9)
Taxes other than income taxes 399,849 370,344 8.0
Depreciation and amortization 721,033 746,125 (3.4)
Other regulatory charges (credits) - net (37,093) 3,681 (1,107.7)
Amortization of rate deferrals 16,583 30,392 (45.4)
---------- ----------
Total 8,047,557 8,513,067 (5.5)
---------- ----------
Operating Income 1,573,342 1,509,062 4.3
---------- ----------
Other Income (Deductions):
Allowance for equity funds used during
construction 26,209 32,022 (18.2)
Gain (loss) on sales of assets - net 5,226 2,340 123.3
Interest and dividend income 159,805 163,050 (2.0)
Equity in earnings of unconsolidated equity affiliates 180,956 13,715 1,219.4
Miscellaneous - net (10,343) 27,077 (138.2)
---------- ----------
Total 349,353 238,204 46.7
---------- ----------
Interest and Other Charges:
Interest on long-term debt 544,920 477,071 14.2
Other interest - net 197,638 85,635 130.8
Dividends on preferred securities of subsidiaries 18,838 18,838 -
Allowance for borrowed funds used during
construction (21,419) (24,114) (11.2)
---------- ----------
Total 739,977 557,430 32.7
---------- ----------
Income Before Income Taxes 1,182,718 1,189,836 (0.6)
Income Taxes 455,693 478,921 (4.9)
---------- ----------
Income Before Cumulative Effect of an Accounting Change 727,025 710,915 2.3
Cumulative Effect of an Accounting Change (net of income taxes) 23,482 - -
---------- ----------
Consolidated Net Income 750,507 710,915 5.6
Preferred dividend requirements of subsidiaries and other 24,311 31,621 (23.1)
---------- ----------
Earnings Applicable to Common Stock $726,196 $679,294 6.9
========== ==========
Earnings Per Average Common Share:
Basic $3.29 $3.00 9.7
Diluted $3.23 $2.97 8.8
Average Number of Common Shares Outstanding:
Basic 220,944,270 226,580,449
Diluted 224,733,662 228,541,307
Entergy Corporation
U.S. Utility Electric
Energy Sales & Customers
Three Months Ended December
2001 2000 %
(Millions of kwh)
Electric Energy Sales:
Residential 6,309 7,055 (10.6)
Commercial 5,873 5,920 (0.8)
Governmental 626 639 (2.0)
Industrial 10,098 11,070 (8.8)
------- -------
Total to Ultimate Customers 22,906 24,684 (7.2)
Wholesale 1,892 2,913 (35.0)
------- -------
Total Sales 24,798 27,597 (10.1)
======= =======
Twelve Months Ended December
2001 2000 %
(Millions of kwh)
Electric Energy Sales:
Residential 31,080 31,998 (2.9)
Commercial 24,706 24,657 0.2
Governmental 2,593 2,605 (0.4)
Industrial 41,577 43,956 (5.4)
-------- --------
Total to Ultimate Customers 99,956 103,216 (3.2)
Wholesale 8,896 9,794 (9.2)
-------- --------
Total Sales 108,852 113,010 (3.7)
======== ========
December
2001 2000 %
Electric Customers (Year to date average):
Residential 2,218,410 2,205,539 0.6
Commercial 296,534 289,427 2.5
Governmental 14,681 14,350 2.3
Industrial 41,125 42,016 (2.1)
---------- ----------
Total to Ultimate Customers 2,570,750 2,551,332 0.8
Wholesale 39 37 5.4
---------- ----------
Total Customers 2,570,789 2,551,369 0.8
========== ==========