Exhibit 99.1
NEWS RELEASE
News Media Contact:
James Peters, (678) 579-5266
Jamie Stephenson, (678) 579-7117
Investors Contact:
John Robinson, (678) 579-7782
www.mirant.com
JANUARY 19, 2001
Southern Energy Inc. reports a 36 percent
increase in earnings for 2000
ATLANTA - Southern Energy Inc. (NYSE: SOE) now operating as Mirant
Corporation, today announced strong financial and operational results, reporting
net income from continuing operations for 2000 of $332 million and $60 million
for fourth quarter 2000.
Net income from continuing operations excludes income from SE Finance,
a leasing subsidiary anticipated to be transferred to Southern Company. Mirant's
reported net income for 2000 was $359 million including the $27 million
contribution from SE Finance.
Mirant's earnings from operations were $366 million for 2000 and $66
million for fourth quarter 2000. Earnings from operations exclude income from SE
Finance and costs associated with the company's transition to a publicly traded
company.
Earnings from operations for 2000 represent a 36 percent increase over
1999 earnings from operations of $270 million. 1999 earnings from operations
exclude gains of $78 million from the sale of the company's United Kingdom
supply business and a gain of $14 million associated with an insurance
settlement at the company's State Line facility.
Mirant posted revenues of $13.3 billion for 2000 and $7.9 billion for
the fourth quarter 2000. Year 2000 revenues reflect the consolidation of
Southern Company Energy Marketing's results into Mirant's financial statements,
following the August 2000 purchase of Vastar Resources' minority stake.
Based on 338.7 million outstanding common shares, the company's 2000
net income from continuing operations equates to 98 cents per share or $1.08 per
share before transition costs. The company's fourth quarter 2000 net income from
continuing operations equates to 18 cents per share or 20 cents per share before
transition costs.
(more)
"All three of our business groups contributed significantly to our
results," said Marce Fuller, president and chief executive officer of Mirant.
"Since our initial public offering, we have delivered on our commitment to
provide shareholders with exceptional financial performance."
Southern Energy also announced today that it will become Mirant
Corporation and will begin trading on the New York Stock Exchange Jan. 22, 2001
under the symbol "MIR".
"As Mirant, we are committed to continue Southern Energy's long-term
track record of success," Fuller said.
The Americas
Mirant's Americas group earned 11 cents per share from operations in
fourth quarter 2000, compared with 7 cents per share in the fourth quarter of
1999. Results reflect the improved performance of the company's marketing and
risk management operations, especially in its natural gas business. Earnings
also reflect credit reserves taken with respect to the power crisis in
California.
As one of the top natural gas- and power-marketing firms in the nation,
Mirant moved more than 6.9 billion cubic feet of natural gas per day and sold
186 million megawatt-hours of power in 2000. The company also manages, under
long-term contracts, more than 3 billion cubic feet of natural gas per day in
the Canadian, San Juan and Gulf Coast regions, along with significant
transportation and storage.
Mirant continues to work toward its goal of owning or controlling
30,000 megawatts of power generation by 2004. In December, the company added
5,154 megawatts to its North American portfolio with the acquisition of power
plants from the Potomac Electric Power Company (PEPCO).
In addition to the PEPCO assets and other greenfield projects which
came on line earlier this year in Wisconsin and Texas, Mirant added more than
5,700 megawatts to its North America business unit - an 84 percent increase from
last year.
In 2001, Mirant expects to bring three plants online in Michigan, Texas
and Louisiana. By year-end, the company expects to have more than 15,000
megawatts under ownership or control throughout key regional markets.
"Mirant plans to continue building power plants, not only to diversify
our portfolio but also to help ease the pressure of increased power demand in
regions where resources are scarce," Fuller said. "A deregulated marketplace
will not flourish without all the necessary components. New power generation is
necessary to maintain a strong wholesale market."
Europe
Mirant's Europe group earned 6 cents per share for the fourth quarter
of 2000, compared to 2 cents in 1999. Mirant's operations in both the United
Kingdom and Germany have performed well, complementing the company's growing
marketing and risk management business in Amsterdam.
In the United Kingdom, Mirant's 49 percent-owned affiliate, Western
Power Distribution Ltd. (WPDL) completed the acquisition of Hyder, a company
that owns and operates the electricity network in South Wales and the water
distribution and wastewater treatment business for all of Wales. Mirant plans to
sell Hyder's water business immediately and merge South Wales Electricity,
Hyder's electricity distribution business, with WPDL. This transaction is
expected to close in the first quarter of 2001.
In Germany, Mirant is still looking to expand its ownership of Bewag,
an integrated utility in Berlin. Mirant owns 26 percent of Bewag. Through that
investment, Mirant is still looking to acquire a controlling interest in VEAG's
generation plants in eastern Germany. German courts recently upheld Mirant's
order to block the sale of E.on's shares in Bewag to HEW, the Hamburg based
utility, majority owned by Vattenfall.
Mirant continues to grow its greenfield development program in Europe
and recently announced an agreement to purchase turbines from GE, providing up
to 3,500 megawatts of capacity in Italy and in other countries targeted for
development.
"Mirant is still growing its European business, continually looking for
opportunities to form strategic relationships with existing utilities and
industry leaders that look to provide great returns to our shareholders and a
valuable service to the people living in the regions where we operate," Fuller
said.
Asia-Pacific
Mirant's Asia-Pacific group earned 7 cents per share for the fourth
quarter, down from 13 cents per share in 1999. This decrease is primarily a
result of the increased tax provision on the company's Philippine enterprise
income.
"Our success in Asia has provided us with a strong platform for growth
throughout the region and has allowed us to develop relationships with strong
regional partners," Fuller said.
Mirant is a global independent power producer and a leading energy
marketing and risk-management company, with extensive operations in North
America, Europe and Asia. Mirant owns more than 17,900 megawatts of electric
generating capacity around the world, including about 12,500 megawatts in the
United States, with another 7,000 megawatts under advanced development. Mirant
is 80 percent owned by Southern Company (NYSE: SO).
Special note regarding forward-looking statements:
The information presented above includes forward-looking statements, in addition
to historical information. These statements involve known and unknown risks and
relate to future events, Southern Energy's future financial performance or
projected business results. In some cases, forward-looking statements by
terminology may be identified by statements such as "may," "will," "should,"
"expects," "plans," "anticipates," "believes," "estimates," "predicts,"
"targets," "potential" or "continue" or the negative of these terms or other
comparable terminology.
Forward-looking statements are only predictions. Actual events or results may
differ materially from any forward-looking statement as a result of various
factors, which include: (i) legislative and regulatory initiatives regarding
deregulation, regulation or restructuring of the electric utility industry; (ii)
the extent and timing of the entry of additional competition in the markets of
Southern Energy's subsidiaries and affiliates; (iii) Southern Energy's pursuit
of potential business strategies, including acquisitions or dispositions of
assets or internal restructuring; (iv) state, federal and other rate regulations
in the United States and in foreign countries in which Southern Energy's
subsidiaries and affiliates operate; (v) changes in or application of
environmental and other laws and regulations to which Southern Energy and its
subsidiaries and affiliates are subject; (vi) political, legal and economic
conditions and developments in the United States and in foreign countries in
which Southern Energy's subsidiaries and affiliates operate; (vii) financial
market conditions and the results of Southern Energy's financing efforts;
changes in commodity prices and interest rates; weather and other natural
phenomena; (viii) performance of Southern Energy's projects undertaken and the
success of efforts to invest in and develop new opportunities; (ix)
unanticipated developments in the California power markets, including, but not
limited to, unanticipated governmental intervention, deterioration in the
financial condition of counterparties, default on receivables due, adverse
results in current or future litigation and adverse changes in the tariffs of
the California Power Exchange Corporation or California Independent System
Operator Corporation, and (x) other factors, including the risks outlined under
"Risk Factors" in filings with the SEC.
Although Southern Energy believes that the expectations reflected in the
forward-looking statements are reasonable, Southern Energy cannot guarantee
future results, events, levels of activity, performance or achievements.
Southern Energy does not undertake a duty to update any of the forward-looking
statements.
# # # # #
SOUTHERN ENERGY, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
For the Three Months For the Years
Ended December 31, Ended December 31,
2000 1999 2000 1999
--------- --------- --------- ---------
(in millions) (in millions)
Operating Revenues: $7,934 $554 $13,289 $2,265
Operating Expenses:
Cost of fuel, electricity and other products 7,413 129 11,378 934
Maintenance 32 35 136 116
Depreciation and amortization 73 92 317 270
Selling, general, and administrative 233 56 553 253
Other 46 101 240 248
--------- --------- --------- ---------
Total operating expenses 7,797 413 12,624 1,821
--------- --------- --------- ---------
Operating Income 137 141 665 444
Other Income (Expense):
Interest income 64 54 187 172
Interest expense (154) (153) (616) (502)
Gain on sales of assets 2 20 20 313
Equity in income of affiliates 64 (47) 196 111
Receivables Recovery - 52 - 64
Other, net 2 49 51 72
--------- --------- --------- ---------
Total other income (expense) (22) (25) (162) 230
--------- --------- --------- ---------
Income From Continuing Operations Before
Income Taxes and Minority Interest 115 116 503 674
Provision for Income Taxes 31 21 87 129
Minority Interest 24 28 84 183
--------- --------- --------- ---------
Income From Continuing Operations 60 67 332 362
Income from Discontinued Operations After
Income Taxes and Minority Interest 7 - 27 10
--------- --------- --------- ---------
Net Income $67 $67 $359 $372
========= ========= ========= =========
Notes:
(1) Financial data reflects various non-operating items. See pages 6 and 7 for details. Certain prior-year data has been
reclassified to conform with the current-year presentation.
(2) Basic Earnings Per Share for the year ended December 31, 2000 was $1.24 based on the weighted average of 288,675,250
shares of common stock outstanding.
SOUTHERN ENERGY, INC. AND SUBSIDIARIES
PRO FORMA EARNINGS PER SHARE (UNAUDITED)
For the Three Months For the Years
Ended December 31, Ended December 31,
2000 1999 % Change 2000 1999 % Change
----------- ---------- ----------- ----------- ----------- -----------
Consolidated Earnings (in millions)
As Reported $67 $67 0% $359 $372 -3%
As Reported from Continuing Operations $60 $67 -10% $332 $362 -8%
Adjustments (page 7) 6 (14) -143% 34 (92) -137%
----------- ---------- ----------- ----------- ----------- -----------
From Operations $66 $53 25% $366 $270 36%
=========== ========== =========== ===========
Pro-forma Basic Earnings Per Share:
Number of shares of common stock as outstanding
as of December 31, 2000(in millions)
338.7 338.7 338.7 338.7
Consolidated Earnings
As Reported $ 0.20 $ 0.20 0% $ 1.06 $ 1.10 -4%
As Reported from Continuing Operations $ 0.18 $ 0.20 -10% $ 0.98 $ 1.07 -8%
Adjustments (page 7) 150% 137%
0.02 (0.04) 0.10 (0.27)
----------- ---------- ----------- ----------- ----------- -----------
From Operations $ 0.20 $ 0.16 25% $ 1.08 $ 0.80 35%
=========== ========== =========== ===========
By Group
Asia-Pacific $ 0.07 $ 0.13 -46% $ 0.60 $ 0.52 15%
Europe 0.06 0.02 200% 0.24 0.50 -52%
Americas 0.11 0.11 0% 0.52 0.27 93%
Corporate (0.06) (0.06) 0% (0.38) (0.22) -73%
Total Adjustments from above 0.02 (0.04) 150% 0.10 (0.27) 137%
----------- ---------- ----------- ----------- ----------- -----------
From Operations $ 0.20 $ 0.16 25% $ 1.08 $ 0.80 35%
=========== ========== =========== ===========
SE Finance (Discontinued Operations) 0.02 - - 0.08 0.03 167%
SOUTHERN ENERGY, INC. AND SUBSIDIARIES
Earnings and Pro Forma Earnings Per Share as Reported and from Operations (Unaudited)
Quarter 1 Quarter 2 Quarter 3 Quarter 4 Year
------------ ------------ ------------ ------------ ------------
2000
Consolidated Earnings (in millions)
As Reported $101 $93 $98 $67 $359
Discontinued Operations (6) (7) (7) (7) (27)
As Reported from Continuing Operations $95 $86 $91 $60 $332
Adjustments for:
Costs Related to Transitioning to a Public Company - - 28 6 34
------------ ------------ ------------ ------------ ------------
From Operations $95 $86 $119 $66 $366
============ ============ ============ ============ ============
1999
Consolidated Earnings (in millions)
As Reported $80 $69 $156 $67 $372
Discontinued Operations (4) (3) (3) - (10)
As Reported from Continuing Operations $76 $66 $153 $67 $362
Adjustments for:
Gain on Sale of SWEB Supply Business - - (78) - (78)
State Line Insurance Settlement - - - (14) (14)
------------ ------------ ------------ ------------ ------------
From Operations $76 $66 $75 $53 $270
============ ============ ============ ============ ============
Pro Forma Basic Earnings Per Share:
Number of shares of common stock as outstanding
as of December 31, 2000(in millions)
338.7 338.7 338.7 338.7 338.7
2000
Pro Forma Basic Earnings Per Share Based
on Consolidated Earnings
As Reported $0.30 $0.27 $0.29 $0.20 $1.06
Discontinued Operations ($0.02) ($0.02) ($0.02) ($0.02) ($0.08)
As Reported from Continuing Operations $0.28 $0.25 $0.27 $0.18 $0.98
Adjustments for:
Costs Related to Transitioning to a Public Company - - $0.08 $0.02 $0.10
------------ ------------ ------------ ------------ ------------
From Operations $0.28 $0.25 $0.35 $0.20 $1.08
============ ============ ============ ============ ============
1999
Pro Forma Basic Earnings Per Share Based on Consolidated Earnings
As Reported $0.24 $0.20 $0.46 $0.20 $1.10
Discontinued Operations ($0.01) ($0.01) ($0.01) - ($0.03)
As Reported from Continuing Operations $0.23 $0.19 $0.45 $0.20 $1.07
Adjustments for:
Gain on Sale of SWEB Supply Business - - ($0.23) - ($0.23)
State Line Insurance Settlement - - $0.00 ($0.04) ($0.04)
------------ ------------ ------------ ------------ ------------
From Operations $0.23 $0.19 $0.22 $0.16 $0.80
============ ============ ============ ============ ============
SOUTHERN ENERGY, INC. AND SUBSIDIARIES
Financial Data by Group (Unaudited)
For the Three Months Ended December 31, 2000 and 1999
Corporate and
Americas Europe Asia-Pacific SE Finance Elimination's
-------- ------- ------- ------- ------ ------ ------ ------ ------ -------
2000 1999 2000 1999 2000 1999 2000 1999 2000 1999
(in millions)
Operating Revenues
Generation and energy marketing 7,721 259 2 (1) 120 116 - - - -
Distribution & integrated utilities 37 44 51 118 - - - - - -
Other - - - - 3 15 - - - 3
-------- ------- ------- ------- ------ ------ ------ ------ ------ -------
Total Operating Revenues 7,758 303 53 117 123 131 - - - 3
Operating Expenses:
Cost of fuel, electricity and other 7,407 121 4 8 2 - - - - -
Depreciation and Amortization 28 25 11 26 33 40 - - 1 -
Other Operating Expenses 260 94 4 47 44 21 - - 3 31
-------- ------- ------- ------- ------ ------ ------ ------ ------ -------
Total Operating Expenses 7,695 240 19 81 79 61 - - 4 31
-------- ------- ------- ------- ------ ------ ------ ------ ------ -------
Operating Income (Loss) 63 63 34 36 44 70 - - (4) (28)
Other Income (Expense)
Interest Income (Expense) (55) (33) (18) (27) (22) (24) - - 5 (14)
Gain on Sale of Assets (1) - 1 21 1 - - - 1 (1)
Equity in income of affiliates 29 (1) 27 (27) 8 (20) - - - -
Other 1 30 (3) 17 20 59 - - (16) (5)
Income (Loss) From Continuing Operations
-------- ------- ------- ------- ------ ------ ------ ------ ------ -------
Minority Interest 37 59 41 20 51 85 - - (14) (48)
Provision (Benefit) for Income Taxes 9 24 - (10) 20 32 - - 2 (25)
Minority Interest (8) (2) 21 22 7 8 - - 4 -
-------- ------- ------- ------- ------ ------ ------ ------ ------ -------
Income (Loss) From Continuing Operations 36 37 20 8 24 45 - - (20) (23)
Income From Discontinued Operations,
Net of Tax Benefit - - - - - - 7 - - -
-------- ------- ------- ------- ------ ------ ------ ------ ------ -------
Net Income (Loss) 36 37 20 8 24 45 7 - (20) (23)
======== ======= ======= ======= ====== ====== ====== ====== ====== =======
SOUTHERN ENERGY, INC. AND SUBSIDIARIES
Financial Data by Group (Unaudited)
For the Years Ended December 31, 2000 and 1999
Corporate and
Americas Europe Asia-Pacific SE Finance Elimination's
------------------------------------------------------------------------------------------
2000 1999 2000 1999 2000 1999 2000 1999 2000 1999
(in millions)
Operating Revenues
Generation and energy marketing $12,301 $ 772 $ - $ (3) $ 489 $ 318 - - - -
Distribution & integrated utilities 163 167 314 976 - - - - - -
Other - - - - 13 24 - - 9 11
------------------------------------------------------ --------- -------------------------
Total Operating Revenues 12,464 939 314 973 502 342 - - 9 11
Operating Expenses:
Cost of fuel, electricity and other
products 11,349 435 27 499 2 - - - - -
Depreciation and Amortization 115 73 69 90 130 104 - - 3 2
Other Operating Expenses 638 284 103 166 104 115 - - 84 53
------------------------------------------------------ --------- -------------------------
Total Operating Expenses 12,102 792 199 755 236 219 - - 87 55
------------------------------------------------------ --------- -------------------------
Operating Income (Loss) 362 147 115 218 266 123 - - (78) (44)
Other Income (Expense)
Interest Income (Expense) (153) (80) (97) (115) (101) (53) - - (78) (81)
Gain on Sale of Assets 10 20 10 293 - - - - - -
Equity in income of affiliates 56 18 83 9 57 83 - - - -
Other 13 37 2 22 36 77 - - - -
Income (Loss) From Continuing Operations
Before Income Taxes and Minority ------------------------------------------------------ --------- -------------------------
Interest 288 142 113 427 258 230 - - (156) (125)
Provision (Benefit) for Income Taxes 114 58 (16) 92 19 28 - - (30) (49)
Minority Interest (3) (9) 47 165 35 27 - - 5 -
------------------------------------------------------ --------- -------------------------
Income (Loss) From Continuing Operations 177 93 82 170 204 175 - - (131) (76)
Income From Discontinued Operations,
Net of Tax Benefit - - - - - - 27 10 - -
------------------------------------------------------ --------- -------------------------
Net Income (Loss) $ 177 $ 93 $ 82 $ 170 $ 204 $ 175 $ 27 $ 10 $(131) $ (76)
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