Entergy Corporation (NYSE: ETR) reported first quarter 2011 earnings of $1.38 per share on as-reported and operational bases. This represents an increase of $.26 over the same period in 2010. Revenues for the first quarter 2011 were $2.8 billion. Net income was $213.8 million.
Operational Earnings Highlights for First Quarter 2011
·
Utility’s results were higher due primarily to higher net revenue driven by increased weather-adjusted sales volumes as well as pricing adjustments from previous rate actions.
·
Entergy Wholesale Commodities’ earnings declined as a result of lower net revenue and lower other income, partially offset by a lower effective income tax rate.
·
Parent & Other’s results were lower due to several individually insignificant items, including higher interest expense on Parent debt.
‘Results for the quarter reflect the continued benefits of constructive regulatory decisions,’ said J. Wayne Leonard, Entergy’s chairman and chief executive officer. ‘The quarter also brought challenges to the business climate for the nuclear industry with the tragic events at the Fukushima Daiichi plant in Japan. The US Nuclear industry adheres to the most diligent regulations and emergency preparedness through extensive common mode failure analysis and superior defense in depth through design and training and preparation. As always, we will continue our intense focus on safety and operational excellence in all aspects of our business. Whatever learning may come from the Fukushima event will be quickly applied to our own emergency preparation and processes.’
The full release from Entergy can be found at the SEC website by clicking HERE or at Entergy's website at
http://www.entergy.com/investor_relations/default.aspx
Entergy’s business highlights include the following:
·
The Nuclear Regulatory Commission issued Vermont Yankee’s renewed facility operating license. Subsequent to that, two Entergy subsidiaries filed a complaint in federal court to prevent the state of Vermont from forcing the plant to cease operation on March 21, 2012.
·
After comprehensive review and analysis, Entergy proposes joining the Midwest Independent System Operator to provide meaningful long-term benefits for the customers of the Entergy Operating Companies.
·
The Utility announced agreements to acquire the Hot Spring and Hinds energy facilities, with targeted closings by mid-2012.
Entergy’s senior management will host its 2011 Analyst Meeting today in New Orleans to discuss quarterly results and other business matters with investors. Entergy will webcast its analyst meeting including a presentation by Chief Financial Officer Leo Denault, who will review quarterly results in his presentation. This webcast is scheduled to begin at 7:30 a.m. CT on April 29th, with Denault’s presentation scheduled to begin at approximately 11:15 a.m. CT. A question-and-answer session will also be webcast starting at approximately 1 p.m. CT. The webcast and presentation slides can be accessed via Entergy’s web site at www.entergy.com.
I.
Consolidated Results
Consolidated Earnings
Table 2 provides a comparative summary of consolidated earnings per share for first quarter 2011 versus 2010, including a reconciliation of GAAP as-reported earnings to non-GAAP operational earnings. Utility’s earnings increased quarter-over-quarter as a result of higher net revenue due largely to increased weather-adjusted sales volume, as well as pricing adjustments from previous rate actions. Weather was also significantly positive for the quarter, but less favorable than the first quarter of last year. Entergy Wholesale Commodities’ first quarter 2011 operational earnings were lower than last year as a result of lower net revenue due to both lower generation and lower pricing. Also contributing to the lower operational results at Entergy Wholesale Commodities was a decrease in other income related to decommissioning trusts. Partially offsetting the decrease was a lower effective income tax rate due to absence of a charge related to federal healthcare legislation enacted in March of last year. Parent and Other’s operational results declined in the current period compared to a year ago due to several individually insignificant items, including higher interest expense on Parent debt. Accretion from Entergy’s share repurchase programs also contributed to increased earnings per share.
Consolidating Income Statement
Three Months Ended March 31, 2010
(Dollars in thousands)
(Unaudited)
U.S. Utilities
Entergy Wholesale Commodities
Parent & Other
Consolidated
OPERATING REVENUES
Electric
$
2,007,802
$
-
$
(871
)
$
2,006,931
Natural gas
96,027
-
-
96,027
Competitive businesses
-
660,399
(4,010
)
656,389
Total
2,103,829
660,399
(4,881
)
2,759,347
OPERATING EXPENSES
Operating and Maintenance:
Fuel, fuel related expenses, and gas purchased for resale
478,055
81,119
(506
)
558,668
Purchased power
467,895
14,483
(7,474
)
474,903
Nuclear refueling outage expenses
27,600
34,689
-
62,289
Other operation and maintenance
435,168
259,697
7,625
702,489
Decommissioning
25,420
26,155
-
51,576
Taxes other than income taxes
109,830
24,866
716
135,412
Depreciation and amortization
227,547
40,513
1,144
269,204
Other regulatory charges (credits) - net
28,092
-
-
28,092
Total
1,799,607
481,522
1,505
2,282,633
304,222
178,877
(6,386
)
476,714
OPERATING INCOME
OTHER INCOME (DEDUCTIONS)
Allowance for equity funds used during construction
13,296
-
-
13,296
Interest and investment income
37,828
49,486
(38,893
)
48,421
Other than temporary impairment losses
-
(212
)
-
(212
)
Miscellaneous - net
(995
)
1,874
(1,401
)
(522
)
Total
50,129
51,148
(40,294
)
60,983
INTEREST EXPENSE
Interest expense
129,412
51,943
(2,157
)
179,199
Allowance for borrowed funds used during construction
(8,001
)
-
-
(8,001
)
Total
121,411
51,943
(2,157
)
171,198
INCOME BEFORE INCOME TAXES
232,940
178,082
(44,523
)
366,499
Income taxes
89,970
87,540
(29,825
)
147,685
CONSOLIDATED NET INCOME
142,970
90,542
(14,698
)
218,814
Preferred dividend requirements of subsidiaries
4,332
683
-
5,015
NET INCOME ATTRIBUTABLE TO ENTERGY CORPORATION
$
138,638
$
89,859
$
(14,698
)
$
213,799
EARNINGS PER AVERAGE COMMON SHARE:
BASIC
$
0.73
$
0.48
$
(0.08
)
$
1.13
DILUTED
$
0.73
$
0.47
$
(0.08
)
$
1.12
AVERAGE NUMBER OF COMMON SHARES OUTSTANDING:
BASIC
189,202,684
DILUTED
191,283,703
*Totals may not foot due to rounding.