Exhibit 99.1
[GRAPHIC OMITTED][GRAPHIC OMITTED]
One Ameren Plaza
1901 Chouteau Avenue
St. Louis, MO 63103
Contact:
Media Analysts Investors
Tim Fox Bruce Steinke Investor Services
(314) 554-3120 (314) 554-2574 (800) 255-2237
tfox2@ameren.com bsteinke@ameren.com invest@ameren.com
FOR IMMEDIATE RELEASE
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AMEREN REPORTS SECOND QUARTER 2004 EARNINGS
Updates 2004 Earnings Guidance
St. Louis, Mo., July 29, 2004---Ameren Corporation (NYSE: AEE) today
announced second quarter 2004 net income of $118 million, or 65 cents per share,
compared to second quarter 2003 net income of $110 million, or 68 cents per
share. Net income for the first six months of 2004 was $215 million, or $1.20
per share, compared to $211 million, or $1.32 per share, in the first half of
2003. Net income in the first six months of last year included an after-tax gain
of $18 million, or 11 cents per share, due to the adoption of an accounting
standard related to asset retirement obligations. Income in the first six months
of 2003 before the cumulative effect of this change in an accounting principle
was $193 million, or $1.21 per share.
"Despite some challenges during the second quarter this year, we once again
delivered solid financial results," said Gary L. Rainwater, chairman, chief
executive officer and president of Ameren Corporation. "This quarter's earnings
per share were down from the prior year due largely to the incremental costs we
incurred in connection with the scheduled refueling and maintenance outage at
our Callaway nuclear plant. A similar Callaway outage did not occur in 2003. In
addition, earnings per share were lower due to the equity dilution principally
caused by our issuance of common shares to prefund the Illinois Power
acquisition. Despite these factors, second quarter earnings per share were only
modestly below the prior year as solid organic growth, a return to more normal
summer weather, stronger power prices and our focus on cost control largely
offset the cost of the Callaway outage and earnings per share dilution," Mr.
Rainwater added.
Revenues in the second quarter of 2004 increased $64 million to $1.2
billion, compared to the same period in 2003. Solid organic growth in the
company's service territory and a return to more normal summer weather as
compared to the prior year largely drove higher revenues. In the second quarter
of 2004, cooling degree days in Ameren's service territory increased
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Add One
approximately 75 percent from the cooler than normal second quarter last year.
Weather-sensitive residential electric sales increased 15 percent, and
commercial electric sales increased 6 percent in the second quarter of 2004
versus 2003.
Interchange electric revenues also increased $15 million in the second
quarter of 2004, as compared to the same period in 2003, due primarily to higher
power prices. Wholesale electric revenues increased $13 million primarily due to
the addition of new customers.
Fuel and purchased power costs rose $43 million, and other operations and
maintenance expenses increased $36 million in the second quarter of 2004 as
compared to the second quarter of 2003. These increased costs were principally
due to the Callaway nuclear plant's scheduled refueling and maintenance outage
in the second quarter of 2004. A refueling outage occurs at the Callaway plant
approximately every 18 months and there was no refueling and maintenance outage
in 2003. This year's outage lasted 64 days and reduced quarterly earnings by an
estimated 22 cents per share due to the incremental cost of fuel and replacement
power and higher maintenance costs.
Operations and maintenance expenses in the second quarter of 2004 benefited
from the Federal Energy Regulatory Commission-ordered refund of $18 million in
exit fees previously paid to the Midwest Independent Transmission System
Operator, Inc. (MISO). Ameren rejoined the MISO on May 1, 2004.
Ameren continues to move towards completion of its proposed acquisition
from Dynegy Inc. (NYSE: DYN) of Decatur, Ill.-based Illinois Power Company and a
20 percent interest in Electric Energy, Inc. "We are moving through regulatory
approvals and remain on target to close the acquisition by the end of this year,
if not sooner. Just yesterday, we received approval of the acquisition from the
Federal Energy Regulatory Commission. In addition, we already have received
approval from the Federal Communications Commission and the waiting period under
the Hart-Scott-Rodino Act has expired. The acquisition must also be approved by
the Illinois Commerce Commission and the Securities and Exchange Commission,"
noted Rainwater.
In early July, Ameren sold 10.9 million new common shares, generating net
proceeds of $445 million. "The proceeds from this offering, when combined with
the $853 million of proceeds generated by our February 2004 common stock
offering, completes our equity financing for the Illinois Power acquisition,"
added Warner L. Baxter, executive vice president and chief financial officer of
Ameren.
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Add Two
Dilution and financing costs, principally resulting from additional common
shares issued in the February offering, reduced earnings by an estimated 6 cents
per share in the second quarter, and 9 cents per share in the first six months
of 2004. Dilution was caused by shares being issued prior to the completion of
the Illinois Power acquisition. Based on current assumptions, the acquisition,
once completed, is expected to be accretive to earnings by 5 to 10 cents per
share in each of the first two years after the closing of that transaction and
is expected to provide significant, long-term value for all of Ameren's
stakeholders.
Due to the expected additional earnings dilution for the second half of
2004 of approximately 8 cents per share from the July common stock offering,
Ameren announced today that the company is adjusting its 2004 guidance for
earnings per share to between $2.70 and $2.90 per share. The 2004 estimate
includes the impact of common shares issued in February and early July to fund
the Illinois Power acquisition, but excludes any potential earnings impact
resulting from the Illinois Power acquisition. The company's guidance is subject
to, among other things, plant operations, weather conditions, energy market and
economic conditions, unusual or otherwise unexpected gains or losses and other
risks and uncertainties outlined in the company's Forward-Looking Statements
section of this release.
Ameren will conduct a conference call for financial analysts at 9:00 a.m.
(Central Time) on Thursday, July 29, to discuss second quarter and year to date
2004 earnings and other matters relating to the company. Investors, the news
media and the public may listen to a live Internet broadcast of the Ameren
analyst call at www.ameren.com by clicking on "Q2 2004 Earnings Conference
Call," then the appropriate audio link. A slide presentation is also available
on Ameren's website that reconciles earnings per share between the second
quarter and first six months of 2003 and the same periods of 2004, and provides
a summary of Ameren's 2004 earnings guidance. To access this presentation,
simply follow the links for the webcast, and then click on the link for the
presentation, which is provided in a .pdf format. The analyst call will also be
available for replay on the Internet for one year. Telephone playback of the
conference call will also be available beginning at 12:00 p.m. (Central Time),
July 29, until August 5 by dialing, U.S. (800) 428-6051; international (973)
709-2089, and entering the number: 366596.
With assets of $14.7 billion, Ameren owns a diverse mix of electric
generating plants strategically located in its Midwest market with a capacity of
more than 14,600 megawatts. Ameren serves 1.7 million electric customers and
500,000 natural gas customers in a 49,000 square-mile area of Missouri and
Illinois.
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Regulation G
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In addition to presenting results of operations and earnings amounts in
total, Ameren has presented certain information in this news release on a per
share basis. These per share amounts reflect certain factors that directly
impact Ameren's total earnings. Ameren believes this per share information is
useful because it enables readers to better understand the impact of these
factors on the company's earnings.
Forward-Looking Statements
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Statements made in this release, which are not based on historical facts,
are "forward-looking" and, accordingly, involve risks and uncertainties that
could cause actual results to differ materially from those discussed. Although
such "forward-looking" statements have been made in good faith and are based on
reasonable assumptions, there is no assurance that the expected results will be
achieved. These statements include (without limitation) statements as to future
expectations, beliefs, plans, strategies, objectives, events, conditions, and
financial performance. In connection with the "safe harbor" provisions of the
Private Securities Litigation Reform Act of 1995, the company is providing this
cautionary statement to identify important factors that could cause actual
results to differ materially from those anticipated. The following factors, in
addition to those discussed elsewhere in this release and in past and subsequent
filings with the Securities and Exchange Commission, could cause actual results
to differ materially from management expectations as suggested by such
"forward-looking" statements:
o the closing and timing of Ameren's acquisition of Illinois Power and the
impact of any conditions imposed by regulators in connection with their
approval thereof;
o the effects of the stipulation and agreement relating to the AmerenUE
Missouri electric excess earnings complaint case and other regulatory
actions, including changes in regulatory policies;
o changes in laws and other governmental actions, including monetary and
fiscal policies;
o the impact on the company of current regulations related to the opportunity
for customers to choose alternative energy suppliers in Illinois;
o the effects of increased competition in the future due to, among other
things, deregulation of certain aspects of the company's business at both
the state and federal levels;
o the effects of participation in a Federal Energy Regulatory
Commission-approved regional transmission organization, including
activities associated with the Midwest Independent System Operator;
o the availability of fuel for the production of electricity, such as coal
and natural gas, and purchased power and natural gas for distribution, and
the level and volatility of future market prices for such commodities,
including the ability to recover any increased costs;
o the use of financial and derivative instruments;
o average rates for electricity in the Midwest;
o business and economic conditions;
o the impact of the adoption of new accounting standards and the application
of appropriate technical accounting rules and guidance;
o interest rates and the availability of capital;
o actions of ratings agencies and the effects of such actions;
o weather conditions;
o generation plant construction, installation and performance;
o operation of nuclear power facilities, including planned and unplanned
outages, and decommissioning costs;
o the effects of strategic initiatives, including acquisitions and
divestitures;
o the impact of current environmental regulations on utilities and generating
companies and the expectation that more stringent requirements will be
introduced over time, which could potentially have a negative financial
effect;
o future wages and employee benefits costs, including changes in returns on
benefit plan assets;
o disruptions of the capital markets or other events making the company's
access to necessary capital more difficult or costly;
o competition from other generating facilities, including new facilities that
may be developed;
o difficulties in integrating AmerenCILCO and Illinois Power, if consummated,
with the company's other businesses;
o changes in the energy markets, environmental laws or regulations, interest
rates or other factors adversely impacting assumptions in connection with
the CILCORP and Illinois Power (if consummated) acquisitions;
o cost and availability of transmission capacity for the energy generated by
the company's generating facilities or required to satisfy energy sales
made by the company; and
o legal and administrative proceedings.
# # #
AMEREN CORPORATION (AEE)
CONSOLIDATED OPERATING STATISTICS
Three Months Ended Six Months Ended
June 30, June 30,
----------------------------- -----------------------------
2004 2003 2004 2003
------------ ------------ ------------ ----------
Electric Sales - KWH (in millions):
Residential 3,984 3,469 8,927 8,219
Commercial 4,877 4,600 9,696 9,124
Industrial 4,448 4,438 8,771 8,226
Wholesale 2,197 1,967 4,687 4,253
Other 73 70 157 148
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Native 15,579 14,544 32,238 29,970
Interchange sales 2,077 2,000 4,501 4,421
EEI (outside sales) 1,229 1,456 2,106 2,225
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Total 18,885 18,000 38,845 36,616
Electric Revenues - (in millions):
Residential $ 312 $ 281 $ 598 $ 555
Commercial 316 302 557 529
Industrial 190 192 354 327
Wholesale 79 66 164 141
Other 6 6 13 12
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Native 903 847 1,686 1,564
Interchange sales 72 57 157 158
EEI (outside sales) 31 42 47 60
Other 26 22 55 42
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Total 1,032 968 1,945 1,824
Power Supply (%):
Fossil 83.9 73.8 81.4 77.3
Nuclear 3.1 13.3 6.5 12.4
Hydro 1.8 1.5 1.7 1.1
Purchased 11.2 11.4 10.4 9.2
Fuel Cost per KWH (cents) 1.142 1.074 1.108 1.030
Gas Sales - MMBTU (in thousands) 12,314 16,697 47,350 43,762
June 30, December 31,
2004 2003
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Common Stock:
Shares outstanding (in millions) 183.3 162.9
Book value per share $ 28.58 $ 26.73
Capitalization Ratios:
Common equity 56.3% 47.5%
Preferred stock 2.0% 2.0%
Debt, net of cash 41.7% 50.5%
AMEREN CORPORATION (AEE)
CONSOLIDATED BALANCE SHEET
(Unaudited, in millions)
June 30, December 31,
2004 2003
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ASSETS
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Current Assets:
Cash and cash equivalents $ 511 $ 111
Accounts receivable - trade 343 326
Unbilled revenue 258 221
Miscellaneous accounts and notes receivable 47 126
Materials and supplies, at average cost 458 487
Other current assets 35 46
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Total current assets 1,652 1,317
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Property and Plant, Net 11,052 10,920
Investments and Other Non-Current Assets:
Investments in leveraged leases 153 164
Nuclear decommissioning trust fund 220 212
Goodwill and other intangibles, net 565 574
Other assets 353 320
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Total investments and other assets 1,291 1,270
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Regulatory Assets 682 729
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TOTAL ASSETS $ 14,677 $ 14,236
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LIABILITIES AND STOCKHOLDERS' EQUITY
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Current Liabilities:
Current maturities of long-term debt $ 291 $ 498
Short-term debt 35 161
Accounts and wages payable 273 480
Taxes accrued 220 103
Other current liabilities 215 215
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Total current liabilities 1,034 1,457
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Long-term Debt, Net 4,051 4,070
Preferred Stock Subject to Mandatory Redemption 21 21
Deferred Credits and Other Non-Current Liabilities:
Accumulated deferred income taxes, net 1,775 1,853
Accumulated deferred investment tax credits 145 151
Regulatory liabilities 862 824
Asset retirement obligations 425 413
Accrued pension and other post-retirement benefits 744 699
Other deferred credits and liabilities 175 190
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Total deferred credits and other liabilities 4,126 4,130
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Preferred Stock Not Subject to Mandatory Redemption 182 182
Minority Interest in Consolidated Subsidiaries 25 22
Stockholders' Equity:
Common stock 2 2
Other paid-in capital, principally premium on common stock 3,456 2,552
Retained earnings 1,835 1,853
Accumulated other comprehensive income (loss) (41) (44)
Other (14) (9)
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Total stockholders' equity 5,238 4,354
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TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 14,677 $ 14,236
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AMEREN CORPORATION (AEE)
CONSOLIDATED STATEMENT OF INCOME
(Unaudited, in millions, except per share amounts)
Three Months Ended Six Months Ended
June 30, June 30,
---------------------- -----------------------
2004 2003 2004 2003
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Operating Revenues:
Electric $ 1 ,032 $ 968 $ 1,945 $ 1,824
Gas 119 118 420 368
Other 1 2 3 4
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Total operating revenues 1,152 1,088 2,368 2,196
Operating Expenses:
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Fuel and purchased power 282 239 553 471
Gas purchased for resale 75 83 288 264
Other operations and maintenance 343 307 649 599
Depreciation and amortization 132 132 262 256
Taxes other than income taxes 74 77 154 155
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Total operating expenses 906 838 1,906 1,745
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Operating Income 246 250 462 451
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Other Income and (Deductions):
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Miscellaneous income 4 5 12 11
Miscellaneous expense (4) (7) (5) (10)
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Total other income and (deductions) - (2) 7 1
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Interest Charges and Preferred Dividends:
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Interest 66 69 130 135
Preferred dividends of subsidiaries 2 2 5 5
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Net interest charges and preferred dividends 68 71 135 140
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Income Before Income Taxes and Cumulative Effect of Change in
Accounting Principle 178 177 334 312
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Income Taxes 60 67 119 119
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Income Before Cumulative Effect of Change in Accounting Principle 118 110 215 193
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Cumulative Effect of Change in Accounting Principle, Net of Income Taxes - - - 18
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Net Income $ 118 $ 110 $ 215 $ 211
==================================================================================================================================
Earnings per Common Share - Basic and Diluted:
Income before cumulative effect of change in accounting principle $ 0.65 $ 0.68 $ 1.20 $ 1.21
Cumulative effect of change in accounting principle, net of income taxes - - - 0.11
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Earnings per Common Share - Basic and Diluted: $ 0.65 $ 0.68 $ 1.20 $ 1.32
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Average Common Shares Outstanding 182.7 161.2 178.5 160.1
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AMEREN CORPORATION (AEE)
CONSOLIDATED STATEMENT OF CASH FLOWS
(Unaudited, in millions)
Six Months Ended
June 30,
-----------------------
2004 2003
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Cash Flows From Operating Activities:
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Net income $ 215 $ 211
Adjustments to reconcile net income to net cash
provided by operating activities:
Cumulative effect of change in accounting principle - (18)
Depreciation and amortization 262 256
Amortization of nuclear fuel 13 16
Amortization of debt issuance costs and premium/discounts 5 5
Deferred income taxes, net (5) (9)
Deferred investment tax credits, net (6) (6)
Coal contract settlement 18 -
Changes in assets and liabilities, excluding the effects of the acquisitions:
Receivables, net (23) 6
Materials and supplies 29 (14)
Accounts and wages payable (162) (149)
Taxes accrued 117 99
Assets, other (57) 17
Liabilities, other 29 27
Other 1 (11)
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Net cash provided by operating activities 436 430
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Cash Flows From Investing Activities:
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Construction expenditures (379) (332)
Acquisitions, net of cash acquired - (489)
Nuclear fuel expenditures (5) (1)
Other 17 6
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Net cash used in investing activities (367) (816)
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Cash Flows From Financing Activities:
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Dividends on common stock (232) (205)
Capital issuance costs (23) (11)
Redemptions, Repurchases and Maturities:
Nuclear fuel lease (67) (20)
Short-term debt (126) (91)
Long-term debt (260) (420)
Issuances:
Common stock 935 308
Long-term debt 104 298
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Net cash provided by (used in) financing activities 331 (141)
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Net Change In Cash and Cash Equivalents 400 (527)
Cash and Cash Equivalents at Beginning of Year 111 628
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Cash and Cash Equivalents at End of Period $ 511 $ 101
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