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AMEREN REPORTS 2004 EARNINGS Announces 2005 Earnings Guidance
PDF Versions of This Release and Supporting Documents

AEE 4th Quarter 2004 Earnings Release
AEE 4th Quarter 2004 Cash Flow, Balance Sheet, Income Statement
AEE 4th Quarter 2004 Consolidated Operating Statistics

Ameren Corporation (NYSE: AEE) today announced 2004 net income of $530 million, or $2.84 per share basic and diluted, compared to net income of $524 million, or $3.25 per share basic and diluted, in 2003. Ameren recorded net income of $83 million, or 42 cents per share basic and diluted, for the fourth quarter of 2004, compared to $38 million, or 24 cents per share basic and diluted, for the fourth quarter of 2003.

Net income in 2003 included a third quarter after-tax gain of $31 million, or 19 cents per share, related to the settlement of a dispute over certain mine reclamation issues with a coal supplier, and a first quarter after-tax gain of $18 million, or 11 cents per share, due to the adoption of a new accounting standard related to the recognition of asset retirement obligations. Excluding these items, adjusted (non-GAAP) net income in 2003 was $475 million, or $2.95 per share basic and diluted.

"Our solid 2004 earnings performance was accomplished despite some of the mildest weather on record and a two-month refueling and maintenance outage at our Callaway nuclear plant. In addition, we prudently issued common stock to fund the Illinois Power acquisition in February and July of 2004, prior to the September completion of the deal. Since we did not have the benefit of Illinois Power's earnings prior to the closing of the transaction, our earnings per share were diluted," said Gary L. Rainwater, chairman, chief executive officer and president of Ameren Corporation.

"We overcame these challenges through effective cost control and the excellent performance of our low-cost coal-fired power plants. The performance of these plants reduced our average generating cost per megawatthour and allowed us to take advantage of strong power prices in the energy markets through the sale of our excess generation," added Rainwater. "Simply put, we remained focused on the fundamentals of our business and executed very well."

Total revenues in 2004 of $5.2 billion increased by $552 million, compared to 2003. The September 30, 2004 acquisition of Illinois Power Company added revenues of $379 million, and the January 31, 2003 acquisition of CILCORP Inc. added revenues of $105 million in 2004 over 2003. In addition, Ameren continued to see the benefit of improved economic conditions with solid organic growth in its service territories.

Record power plant production in 2004 and mild weather boosted the amount of low-cost generation available, increasing interchange electric sales by almost 17 percent, and increasing interchange revenues by $71 million in 2004, as compared to 2003. These factors, coupled with strong power prices in the energy markets, resulted in interchange power sales contributing 71 cents per share to earnings in 2004, versus 55 cents per share in 2003, on a comparable share basis.

However, heating degree days in 2004 were approximately 7 percent below 2003, and cooling degree days in the summer months were more than 20 percent below 2003. Weather in both 2003 and 2004 was mild, but, according to the National Weather Service, 2004 summer weather in Ameren's service territory was the 7th mildest in the past 109 years. In total, mild weather reduced revenues by an estimated $51 million in 2004, as compared to 2003. Electric rate reductions in Missouri also decreased revenues by $34 million in 2004, while increases in natural gas delivery rates raised revenues by $27 million in 2004, as compared to 2003.

In the spring of 2004, the Callaway nuclear plant had a 64-day refueling and maintenance outage. That outage increased purchased power and maintenance expenses by $63 million in 2004, as compared to 2003 when there was no refueling outage. In addition, operating expenses rose due to higher employee benefit costs and depreciation expenses, as well as due to the acquisitions of Illinois Power and CILCORP. Offsetting these increases, in part, were lower labor costs and a 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.

Earnings per share in 2004 were also reduced by 19 cents, compared to 2003, as a result of the issuance of 30 million new common shares prior to the close of the acquisition of Illinois Power. On September 30, 2004, Ameren completed the acquisition of Decatur, Ill-based Illinois Power and a 20 percent interest in Electric Energy, Inc. for $2.3 billion. Proceeds from the issuance of common stock of $1.3 billion were used to pay the cash portion of the purchase price and eliminate approximately $700 million of Illinois Power's high-cost debt in the fourth quarter of 2004.

"Illinois Power is a natural fit for Ameren. Illinois Power's adjoining service territories and core energy business fits nicely into Ameren's existing businesses," added Rainwater. "Importantly, we expect Illinois Power will be accretive to earnings in the first two years of ownership by a total of 9 to 13 cents per share, up from our original estimate of 5 to 10 cents per share. By completing this acquisition in only eight months, we have positioned ourselves very well to integrate Illinois Power into Ameren and quickly begin realizing synergies."

Ameren also announced today that its 2005 earnings are expected to range between $2.90 and $3.10 per share, compared to earnings of $2.84 per share in 2004. Ameren's guidance assumes normal weather and is subject to, among other things, plant operations, energy market and economic conditions, unusual or otherwise unexpected gains or losses and other risks and uncertainties outlined in Ameren's Forward-looking Statements.

"We expect 2005 earnings per share to rise above the 2004 level," stated Warner L. Baxter, Executive Vice President and Chief Financial Officer. "Our 2005 earnings are expected to increase due to continued solid organic growth in our service territories, coupled with a return to more normal weather. In addition, we expect 2005 earnings per share to increase due to the Illinois Power acquisition as we will realize a full year of Illinois Power's earnings and will eliminate the dilution associated with the prefunding of the Illinois Power acquisition.

"These benefits will be offset, in part, by higher employee benefit and depreciation expenses in 2005. In addition, we expect to realize lower margins from interchange sales due to reduced levels of low-cost excess generation being available for sale. We anticipate greater levels of low cost, coal- fired generation being needed to serve our native load customers due to demand growth and an expected return to more normal weather conditions, as well as due to a planned 70 to 75-day refueling and maintenance outage at our Callaway nuclear plant in the fall of 2005. Also, earnings per share in 2005 will be reduced by the issuance of additional common stock under our DRPlus and employee benefit plans and under our outstanding adjustable conversion-rate equity security units."

Ameren will conduct a conference call for financial analysts at 9:00 a.m. (Central Time) on Tuesday, Feb. 8, 2005, to discuss 2004 earnings, 2005 guidance and other matters related 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 "Q4 2004 Ameren Corporation Earnings Conference Call," then the appropriate audio link. A slide presentation is also available on Ameren's Web site that reconciles earnings per share between 2004 and 2003 and reconciles 2005 earnings guidance to 2004 actual earnings. This presentation will be posted in the Investors section of the site under presentations and 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), from Feb. 8 through Feb. 15, by dialing, U.S. (888) 203-1112; international (719) 457-0820, and entering the number: 360884.

With assets of more than $17 billion, Ameren serves approximately 2.3 million electric customers and more than 900,000 natural gas customers in a 64,000 square mile area of Missouri and Illinois. Ameren owns a diverse mix of electric generating plants strategically located in its Midwest market with a generating capacity of more than 14,800 megawatts.

Regulation G

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, as well as adjusted (non-GAAP) net income. These per share amounts, as well as the deductions from net income to arrive at adjusted (non-GAAP) net income, reflect certain factors that directly impact Ameren's total earnings. Ameren believes this per share information and the adjusted (non-GAAP) net income figure are useful because they enable readers to better understand the impact of these factors on Ameren's earnings.

Forward-looking Statements

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, we are 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 securities filings, could cause actual results to differ materially from management expectations as suggested by such "forward-looking" statements:

• regulatory actions, including changes in regulatory policies;

• changes in laws and other governmental actions, including monetary and fiscal policies;

• the effects of increased competition in the future due to, among other things, deregulation of certain aspects of our business at both the state and federal levels, and the implementation of deregulation, such as in Illinois when current power supply contracts expire in 2006;

• the effects of participation in the Midwest Independent System Operator (MISO);

• 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;

• the use of financial and derivative instruments;

• prices for power in the Midwest;

• business and economic conditions, including their impact on interest rates;

• disruptions of the capital markets or other events making Ameren's access to necessary capital more difficult or costly;

• the impact of the adoption of new accounting standards and the application of appropriate technical accounting rules and guidance;

• actions of ratings agencies and the effects of such actions;

• weather conditions;

• generation plant construction, installation and performance;

• operation of nuclear power facilities, including planned and unplanned outages, and decommissioning costs;

• the effects of strategic initiatives, including acquisitions and divestitures;

• 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;

• future wages and employee benefits costs, including changes in returns on benefit plan assets;

• difficulties in integrating Illinois Power with Ameren's other businesses;

• changes in the energy markets, environmental laws or regulations, interest rates or other factors adversely impacting assumptions in connection with the CILCORP Inc. and Illinois Power acquisitions;

• cost and availability of transmission capacity for the energy generated by Ameren's generating facilities or required to satisfy energy sales made by Ameren; and

• legal and administrative proceedings.

Given these uncertainties, undue reliance should not be placed on these forward- looking statements. Except to the extent required by the federal securities laws, we undertake no obligation to publicly update or revise any forward- looking statements, whether as a result of new information, future events or otherwise.

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