2009 EARNINGS GUIDANCE UPDATED
ST. LOUIS, Mo., May 1 /PRNewswire-FirstCall/ -- Ameren Corporation today announced first quarter 2009 net income in accordance with generally accepted accounting principles (GAAP) of $141 million, or 66 cents per share, compared to first quarter 2008 GAAP net income of $138 million, or 66 cents per share. Excluding the effects of mark-to-market activity and the 2007 Illinois electric rate relief settlement in each year, Ameren recorded first quarter 2009 core (non-GAAP) net income of $114 million, or 54 cents per share, compared to first quarter 2008 core (non-GAAP) net income of $134 million, or 64 cents per share.
A reconciliation of GAAP to core (non-GAAP) earnings per share is as follows:
First Quarter
2009 2008
GAAP earnings per share $0.66 $0.66
Illinois electric rate relief settlement, net 0.02 0.03
Mark-to-market activity, net (0.14) (0.05)
Core (non-GAAP) earnings per share $0.54 $0.64
The decline in core (non-GAAP) earnings per share in the first quarter of 2009, versus the same period in 2008, was principally due to lower electric and gas sales volumes, higher fuel and related transportation prices, the impact of a severe winter ice storm and the effect of gas rate redesign in the Illinois regulated utility segment. The items noted above more than offset the benefit to earnings of new utility service rates in Illinois, effective October 1, 2008, and in Missouri, effective March 1, 2009, among other factors.
"Despite the challenges of the current economic downturn, we remain focused on executing our strategy," said Thomas R. Voss, president and chief executive officer of Ameren Corporation. "That strategy calls for prudently investing in our regulated businesses to meet our customers' needs and expectations, achieving constructive regulatory frameworks and returns and optimizing our non-rate-regulated generating assets. I expect execution of this strategy will position us to deliver solid, long-term shareholder value."
In the first quarter of 2009, milder weather and the absence of a leap day contributed to a 6% decline in kilowatthour sales to residential customers and a 2% sales decline to commercial customers, compared to the year-ago quarter. Absent these factors, Ameren estimates that first quarter 2009 residential and commercial kilowatthour sales each declined a more modest 1%, versus the year-ago period. The weak economy significantly impacted industrial electric sales. They declined 13% from the year-ago quarter, excluding the impact of reduced demand from AmerenUE's largest customer, the Noranda Aluminum, Inc., smelter plant in New Madrid, Missouri. Noranda's plant sustained damage because of a power interruption on non-Ameren-owned power lines during a severe January ice storm. This loss of operating capacity at Noranda is expected to last through much of 2009.
At the non-rate-regulated generation segment, first quarter 2009 earnings were relatively flat, with those of the year-ago quarter. These 2009 results reflected proactive forward sales of 2009 generation in prior years at higher-than-current market prices.
2009 Earnings Guidance
Ameren also announced today that it updated its expectations for full-year 2009 earnings. GAAP earnings for 2009 are now expected to be in the range of $2.63 to $2.98 per share, down from the prior $2.68 to $3.08, and core (non-GAAP) earnings are now expected to be in the range of $2.70 to $3.05 per share, down from the prior $2.75 to $3.15 per share. An estimated 7 cents per share negative impact in 2009 from the 2007 settlement agreement among parties in Illinois to provide comprehensive electric rate relief and customer assistance is excluded from core (non-GAAP) earnings guidance. Any net unrealized mark-to-market gains or losses will impact GAAP earnings, but are excluded from GAAP and core (non-GAAP) earnings guidance because the company is unable to reasonably estimate the impact of any such gains or losses. The updated GAAP and core (non-GAAP) guidance include the effects of a severe January 2009 winter storm, including an estimate of the related full-year impact of reduced electric margins due to the loss of operating capacity at the Noranda Aluminum smelter plant. The prior earnings guidance, which was issued in mid-February, had excluded these storm-related impacts.
In addition to incorporating the severe storm costs and the estimated impact on electric margins of the related Noranda outage, the revised earnings guidance is also based on higher expected financing costs for new credit facilities and lower expected sales to industrial customers than had been included in the prior guidance. These negatives are offset, in part, by higher expected long-term sales for resale.
Ameren expects its business segments to provide the following contributions to full year 2009 core (non-GAAP) earnings per share:
Missouri Regulated $1.15 - $1.25
Illinois Regulated 0.40 - 0.50
Non-rate-regulated Generation 1.15 - 1.30
2009 Core (Non-GAAP) Earnings Guidance Range $2.70 - $3.05
Ameren's earnings guidance for 2009 assumes normal weather and is subject to, among other things, regulatory decisions and legislative actions, plant operations, energy and capital and credit market conditions, economic conditions, severe storms, unusual or otherwise unexpected gains or losses, and other risks and uncertainties outlined, or referred to, in the Forward-looking Statements section of this press release.
Missouri Regulated Operations Earnings
Core (non-GAAP) earnings in the first quarter of 2009 were $6 million, down from $45 million in the first quarter of 2008. This decline was primarily due to lower native load electric sales reflecting the weak economy, milder weather, the outage at the Noranda Aluminum smelter, as well as lower margins on electric off-system sales. In addition, there were higher distribution system reliability expenses, including storm costs, higher fuel and related transportation costs and a 12-day unscheduled outage at the Callaway Nuclear Plant. The above negatives were offset, in part, by new, higher electric rates, effective March 1, 2009. Missouri regulated operations recorded GAAP earnings in the first quarter of 2009 of $23 million, $29 million less than in the first quarter of 2008. In addition to the items noted above, this GAAP earnings decrease was reduced by net unrealized mark-to-market activity.
Illinois Regulated Operations Earnings
Core (non-GAAP) earnings in the first quarter of 2009 were $25 million, up from $18 million in the first quarter of 2008. This increase was primarily due to new, higher electric and natural gas delivery service rates, effective October 1, 2008. The increase was offset, in part, by lower electric and natural gas sales, reflecting the weak economy and milder weather and the previously discussed seasonal gas rate redesign. Effective October 1, 2008, the Illinois Commerce Commission authorized a change in the way natural gas distribution costs are recovered from residential and commercial customers. This rate redesign shifts some revenues from the first quarter to other quarters with no expected impact on full-year earnings. Illinois regulated operations recorded GAAP earnings in the first quarter of 2009 of $25 million, up $9 million from the first quarter of 2008. In addition to the items noted above, this GAAP earnings increase was primarily due to lower costs in 2009 related to the 2007 Illinois electric settlement agreement.
Non-rate-regulated Generation Operations Earnings
Core (non-GAAP) earnings in the first quarter of 2009 were $85 million, versus $80 million in the first quarter of 2008. This increase in earnings was mainly driven by higher realized margins reflecting proactive forward sales of 2009 generation in prior years and lower plant operations and maintenance expenses. These positives were partly offset by higher fuel and related transportation prices, among other things. GAAP earnings from non-rate-regulated generation operations in the first quarter of 2009 were $93 million, compared to $78 million in the first quarter of 2008. In addition to the items noted above, this increase in GAAP earnings was driven by higher net unrealized mark-to-market gains and lower costs related to the 2007 Illinois electric settlement agreement.
Analyst Conference Call
Ameren will conduct a conference call for financial analysts at 9:00 a.m. Central Time on Friday, May 1, to discuss first quarter 2009 earnings and other matters. Investors, the news media and the public may listen to a live Internet broadcast of the call at www.ameren.com by clicking on "Q1 2009 Ameren Corporation Earnings Conference Call," followed by the appropriate audio link. An accompanying slide presentation will be available on Ameren's Web site. This presentation will be posted in the "Investors" section of the Web site under "Presentations." The analyst call will also be available for replay on the Internet for one year. In addition, a telephone playback of the conference call will be available beginning at approximately noon Central Time, from May 1 through May 7, by dialing, U.S. (800) 406-7325; international (303) 590-3030 and entering the number: 4053513#.
About Ameren
With assets of $23 billion, Ameren serves approximately 2.4 million electric customers and almost one million 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 16,400 megawatts.
Regulation G Statement
Ameren has presented certain information in this release on a diluted cents per share basis. These diluted per share amounts reflect certain factors that directly impact Ameren's total earnings per share. The core (non-GAAP) earnings per share and core (non-GAAP) earnings per share guidance excludes one or more of the following: the earnings impact of the settlement agreement among parties in Illinois for comprehensive electric rate relief and customer assistance and net mark-to-market gains or losses. Ameren uses core (non-GAAP) earnings internally for financial planning and for analysis of performance. Ameren also uses core (non-GAAP) earnings as primary performance measurements when communicating with analysts and investors regarding our earnings results and outlook, as the company believes it allows it to more accurately compare the company's ongoing performance across periods.
In providing consolidated and segment core (non-GAAP) earnings guidance, there could be differences between core (non-GAAP) earnings and earnings prepared in accordance with GAAP for certain items, such as those listed above. Ameren is unable to estimate the impact, if any, on future GAAP earnings of such items.
Forward-looking Statements
Statements in this release not based on historical facts are considered "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 our filings with the Securities and Exchange Commission, could cause actual results to differ materially from management expectations suggested in such forward-looking statements:
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 update or revise publicly any forward-looking statements to reflect new information or future events.
AMEREN CORPORATION (AEE)
CONSOLIDATED BALANCE SHEET
(Unaudited, in millions)
March 31, December 31,
2009 2008
ASSETS
Current Assets:
Cash and cash equivalents $304 $92
Accounts receivable - trade, net 554 502
Unbilled revenue 247 427
Miscellaneous accounts and notes
receivable 318 292
Materials and supplies 657 842
Mark-to-market derivative assets 324 207
Current portion of regulatory assets 159 79
Other current assets 194 153
Total current assets 2,757 2,594
Property and Plant, Net 16,781 16,567
Investments and Other Assets:
Nuclear decommissioning trust fund 223 239
Goodwill 831 831
Intangible assets 160 167
Regulatory assets 1,682 1,653
Other assets 637 606
Total investments and other assets 3,533 3,496
TOTAL ASSETS $23,071 $22,657
LIABILITIES AND EQUITY
Current Liabilities:
Current maturities of long-term debt $380 $380
Short-term debt 997 1,174
Accounts and wages payable 519 813
Taxes accrued 83 54
Interest accrued 167 107
Mark-to-market derivative liabilities 273 155
Other current liabilities 462 380
Total current liabilities 2,881 3,063
Long-term Debt, Net 6,900 6,554
Deferred Credits and Other Liabilities:
Accumulated deferred income taxes, net 2,159 2,131
Accumulated deferred investment tax
credits 97 100
Regulatory liabilities 1,296 1,291
Asset retirement obligations 412 406
Pension and other postretirement
benefits 1,514 1,495
Other deferred credits and liabilities 539 438
Total deferred credits and other
liabilities 6,017 5,861
Ameren Corporation Stockholders'
Equity:
Common stock 2 2
Other paid-in capital, principally
premium on common stock 4,812 4,780
Retained earnings 2,241 2,181
Accumulated other comprehensive income 6 -
Total Ameren Corporation
stockholders' equity 7,061 6,963
Noncontrolling Interests 212 216
Total equity 7,273 7,179
TOTAL LIABILITIES AND EQUITY $23,071 $22,657
AMEREN CORPORATION (AEE)
CONSOLIDATED STATEMENT OF INCOME
(Unaudited, in millions, except per share amounts)
Three Months
Ended
March 31,
2009 2008
Operating Revenues:
Electric $1,395 $1,469
Gas 521 612
Total operating revenues 1,916 2,081
Operating Expenses:
Fuel 274 302
Purchased power 233 287
Gas purchased for resale 383 459
Other operations and maintenance 421 430
Depreciation and amortization 174 169
Taxes other than income taxes 110 113
Total operating expenses 1,595 1,760
Operating Income 321 321
Other Income and Expenses:
Miscellaneous income 16 19
Miscellaneous expense (4) (4)
Total other income 12 15
Interest Charges 118 100
Income Before Income Taxes 215 236
Income Taxes 70 87
Net Income 145 149
Less: Net Income Attributable to Noncontrolling
Interests 4 11
Net Income Attributable to Ameren Corporation $141 $138
Earnings per Common Share - Basic and Diluted $0.66 $0.66
Average Common Shares Outstanding 212.7 208.7
AMEREN CORPORATION (AEE)
CONSOLIDATED STATEMENT OF CASH FLOWS
(Unaudited, in millions)
Three Months
Ended
March 31,
2009 2008
Cash Flows From Operating Activities:
Net income $145 $149
Adjustments to reconcile net income to net cash
provided by operating activities:
Gain on sales of emission allowances - (2)
Net mark-to-market gain on derivatives (51) (16)
Depreciation and amortization 176 180
Amortization of nuclear fuel 12 11
Amortization of debt issuance costs and premium/
discounts 4 5
Deferred income taxes and investment tax credits, net 32 23
Other (1) (1)
Changes in assets and liabilities:
Receivables 119 (52)
Materials and supplies 185 179
Accounts and wages payable (245) (80)
Taxes accrued, net 29 4
Assets, other 45 63
Liabilities, other 128 44
Pension and other postretirement benefits 36 22
Counterparty collateral, net (53) (88)
Taum Sauk costs, net of insurance recoveries (24) (112)
Net cash provided by operating activities 537 329
Cash Flows From Investing Activities:
Capital expenditures (424) (420)
Nuclear fuel expenditures (3) (102)
Purchases of securities - nuclear decommissioning
trust fund (203) (89)
Sales of securities - nuclear decommissioning
trust fund 200 86
Purchases of emission allowances (2) (2)
Net cash used in investing activities (432) (527)
Cash Flows From Financing Activities:
Dividends on common stock (82) (133)
Capital issuance costs (3) -
Dividends paid to noncontrolling interest holders (8) (10)
Short-term debt, net (177) 145
Redemptions, repurchases, and maturities of long-
term debt - (19)
Issuances:
Common stock 28 46
Long-term debt 349 -
Net cash provided by financing activities 107 29
Net change in cash and cash equivalents 212 (169)
Cash and cash equivalents at beginning of year 92 355
Cash and cash equivalents at end of period $304 $186
AMEREN CORPORATION (AEE)
CONSOLIDATED OPERATING STATISTICS
Three Months Ended
March 31,
2009 2008
Electric Sales - kilowatthours (in millions):
Missouri Regulated
Residential 3,697 3,978
Commercial 3,473 3,523
Industrial 1,629 2,278
Other 176 184
Native load subtotal 8,975 9,963
Off-system sales 3,250 3,111
Subtotal 12,225 13,074
Illinois Regulated
Residential
Generation and delivery
service 2,948 3,082
Commercial
Generation and delivery
service 1,369 1,442
Delivery service only 1,490 1,515
Industrial
Generation and delivery
service 113 335
Delivery service only 2,604 2,867
Other 137 146
Native load subtotal 8,661 9,387
Non-rate-regulated Generation
Non-affiliate energy sales 5,545 6,387
Affiliate native energy sales 1,275 1,761
Subtotal 6,820 8,148
Eliminate affiliate sales (1,275) (1,761)
Eliminate Illinois Regulated/Non-rate-regulated
Generation common customers (1,305) (1,250)
Ameren Total 25,126 27,598
Electric Revenues (in millions):
Missouri Regulated
Residential $209 $218
Commercial 167 165
Industrial 59 76
Other 11 28
Native load subtotal 446 487
Off-system sales 133 154
Subtotal 579 641
Illinois Regulated
Residential
Generation and delivery
service 279 258
Commercial
Generation and delivery
service 134 134
Delivery service only 21 17
Industrial
Generation and delivery
service 1 27
Delivery service only 8 7
Other 51 88
Native load subtotal 494 531
Non-rate-regulated
Generation
Non-affiliate energy sales 304 317
Affiliate native energy sales 116 118
Other 32 15
Subtotal 452 450
Eliminate affiliate revenues (130) (153)
Ameren Total $1,395 $1,469
AMEREN CORPORATION (AEE)
CONSOLIDATED OPERATING STATISTICS
Three Months Ended
March 31,
2009 2008
Electric Generation - megawatthours
(in millions):
Missouri Regulated 12.3 12.9
Non-rate-regulated Generation
Ameren Energy Generating
Company (Genco) 3.4 4.4
AmerenEnergy Resources Generating
Company (AERG) 1.4 1.7
Electric Energy, Inc. (EEI) 1.9 2.0
AmerenEnergy Medina Valley
Cogen, L.L.C. 0.1 0.1
Subtotal 6.8 8.2
Ameren Total 19.1 21.1
Fuel Cost per kilowatthour (cents)
Missouri Regulated 1.328 1.231
Non-rate-regulated Generation 1.957 1.900
Gas Sales - decatherms (in thousands)
Missouri Regulated 5,437 6,208
Illinois Regulated 43,141 50,783
Other 2,093 638
Ameren Total 50,671 57,629
Net Income (Loss) by Segment (in
millions):
Missouri Regulated $23 $52
Illinois Regulated 25 16
Non-rate-regulated Generation 93 78
Other - (8)
Ameren Total $141 $138
March 31, December 31,
2009 2008
Common Stock:
Shares outstanding (in millions) 213.4 212.3
Book value per share $33.08 $32.80
Capitalization Ratios:
Common equity 46.3% 45.9%
Preferred stock of subsidiaries 1.3% 1.3%
Debt, net of cash 52.4% 52.8%
SOURCE: Ameren Corporation
Web site: http://www.ameren.com/