AMEREN CORPORATION ST. LOUIS, Nov. 6, 2014 /PRNewswire/ -- Ameren Corporation (NYSE: AEE) today announced third quarter 2014 net income from continuing operations of $294 million, or $1.20 per diluted share, compared to third quarter 2013 net income from continuing operations of $305 million, or $1.25 per diluted share.
The year-over-year decrease in third quarter 2014 earnings from continuing operations reflected this year's milder temperatures, which reduced native load electric sales volumes, as well as a higher effective income tax rate. In addition, depreciation and amortization expenses increased from the year-ago quarter. Factors positively affecting the earnings comparison included increased rates, effective Jan. 1, 2014, for Federal Energy Regulatory Commission (FERC)-regulated electric transmission and Illinois natural gas delivery services, as well as decreased interest charges.
"Despite very mild summer weather in the third quarter, we remain on track to deliver solid earnings results in 2014 as we continue to execute our plan very well, which is enhancing value for our customers and our shareholders," said Warner L. Baxter, chairman, president and chief executive officer of Ameren Corporation. "The mild third quarter weather erased much of the weather-related benefits realized earlier in the year. As a result, our guidance range for 2014 earnings from continuing operations has been narrowed to $2.30 to $2.45 per share, from our prior range of $2.30 to $2.50 per share.
"We remain focused on exercising disciplined cost management, as well as successfully executing several key energy infrastructure projects for the benefit of our customers. In Missouri, we are replacing the reactor vessel head at our Callaway Nuclear Energy Center during its scheduled refueling and maintenance outage, completing the installation of additional environmental controls at our Labadie Energy Center, and placing into service the largest investor-owned solar facility in the state, all by year-end. In Illinois, our grid modernization plan, including installation of advanced electric and gas meters, and our construction activities for the Illinois Rivers transmission project are proceeding as planned."
Ameren recorded net income from continuing operations for the nine months ended Sept. 30, 2014, of $541 million, or $2.21 per diluted share, compared to net income from continuing operations for the nine months ended Sept. 30, 2013, of $464 million, or $1.91 per diluted share. This earnings increase reflected the absence in the current year period of 2013 Callaway Nuclear Energy Center refueling and maintenance outage expenses, as well as a 2013 Missouri fuel adjustment clause-related charge. In 2014, a Callaway refueling outage is occurring in the fourth quarter, compared to a second quarter refueling outage in 2013. Other factors contributing to the positive earnings comparison included increased rates, effective Jan. 1, 2014, for FERC-regulated electric transmission and Illinois natural gas delivery services, as well as decreased interest charges. In addition, the benefits of colder winter temperatures, partially offset by milder summer temperatures, drove increased native load electric and natural gas sales volumes. Factors having a negative effect on the earnings comparison included a higher effective income tax rate and increased depreciation and amortization expenses.
Guidance for Earnings from Continuing Operations
Ameren now expects diluted earnings per share to be in a range of $2.30 to $2.45 for 2014, compared to the prior range of $2.30 to $2.50 per share, reflecting the effect of mild third quarter 2014 temperatures. These mild temperatures reduced third quarter 2014 earnings by an estimated nine cents per share compared to normal.
Ameren continues to expect diluted earnings per share to grow at a 7% to 10% compound annual rate from 2013 through 2018. This expected five-year growth is driven primarily by infrastructure investments in FERC-regulated electric transmission and Illinois-regulated electric and natural gas delivery services.
Ameren's earnings guidance assumes normal temperatures for the fourth quarter of this year and, along with Ameren's growth expectations, is subject to the effects of, among other things, 30-year U.S. Treasury bond yields; regulatory decisions and legislative actions; energy center and energy delivery operations; energy, economic, capital and credit market 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.
Ameren Missouri Segment Results
Ameren Missouri segment third quarter 2014 earnings were $222 million, compared to third quarter 2013 earnings of $238 million. This earnings decrease reflected this year's milder temperatures, which reduced native load electric sales volumes, as well as higher other operations and maintenance expenses. The earnings comparison was also negatively affected by higher interest charges and increased depreciation and amortization expenses. A lower effective income tax rate positively affected the comparison.
Ameren Illinois Segment Results
Ameren Illinois segment third quarter 2014 earnings were $75 million, compared to third quarter 2013 earnings of $77 million. This earnings decrease reflected this year's milder temperatures, which reduced native load electric sales volumes. Factors having a positive effect on the earnings comparison included increased rates, effective Jan. 1, 2014, for FERC-regulated electric transmission and Illinois natural gas delivery services.
Parent Company and Other
The Parent Company and Other loss from continuing operations for the third quarter of 2014 was $3 million, compared to a loss of $10 million for the third quarter of 2013. This reduced loss reflected lower other operations and maintenance expenses, primarily due to the substantial elimination of business and administrative costs previously incurred in support of the divested merchant generation business. Other factors contributing to the reduced loss included decreased interest charges, resulting from the May 2014 maturity of parent company 8.875% senior notes, and increased earnings from Ameren Transmission Company of Illinois, reflecting infrastructure investments made under FERC ratemaking. The earnings effect of these positive factors was partially offset by a higher effective income tax rate.
Analyst Conference Call
Ameren will conduct a conference call for financial analysts at 9 a.m. Central Time on Thursday, Nov. 6, to discuss third quarter 2014 earnings, earnings guidance and growth expectations, and other matters. Investors, the news media and the public may listen to a live Internet broadcast of the call at Ameren.com by clicking on "Q3 2014 Ameren Corporation Earnings Conference Call," followed by the appropriate audio link. An accompanying slide presentation will be available on Ameren's website. The conference call and this presentation will be accessible in the "Investors" section of the website under "Webcasts & Presentations." The analyst call will be available for replay on Ameren's website for one year. In addition, a telephone playback of the conference call will be available beginning at approximately noon Central Time from Nov. 6 through Nov. 13 by dialing U.S. and Canada 877.660.6853 or international 201.612.7415, and entering ID number 13594250.
About Ameren
St. Louis-based Ameren Corporation powers the quality of life for 2.4 million electric customers and more than 900,000 natural gas customers in a 64,000-square-mile area through its Ameren Missouri and Ameren Illinois rate-regulated utility subsidiaries. Ameren Illinois provides electric delivery and transmission service as well as natural gas delivery service while Ameren Missouri provides vertically integrated electric service, with generating capacity of 10,300 megawatts, and natural gas delivery service. Ameren Transmission Company of Illinois develops regional electric transmission projects. Follow the company on Twitter @AmerenCorp. For more information, visit Ameren.com.
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 under Risk Factors in Ameren's Form 10-K for the year ended December 31, 2013 and elsewhere in this release and in our other filings with the Securities and Exchange Commission, could cause actual results to differ materially from management expectations suggested in such forward-looking statements:
-- regulatory, judicial, or legislative actions, including changes in
regulatory policies and ratemaking determinations, such as Ameren
Missouri's July 2014 electric rate case filing; Ameren Illinois' appeals
of the Illinois Commerce Commission's electric and natural gas rate
orders issued in December 2013; Ameren Illinois' April 2014 annual
electric delivery service formula update filing; FERC settlement
procedures regarding a potential Ameren Illinois electric transmission
rate refund; the complaint case filed with FERC seeking a reduction in
the allowed return on common equity under the Midcontinent Independent
System Operator tariff; and future regulatory, judicial, or legislative
actions that seek to change regulatory recovery mechanisms;
-- the effect of Ameren Illinois participating in a performance-based
formula ratemaking process under the Illinois Energy Infrastructure
Modernization Act (IEIMA), including the direct relationship between
Ameren Illinois' return on common equity and 30-year United States
Treasury bond yields, the related financial commitments required by the
IEIMA, and the resulting uncertain impact on the financial condition,
results of operations and liquidity of Ameren Illinois;
-- the potential extension of the IEIMA after its current sunset provision
at the end of 2017, and any changes to the performance-based formula
ratemaking process or required financial commitments;
-- the effects of Ameren Illinois' expected participation, beginning in
2015, in the regulatory framework provided by the state of Illinois'
Natural Gas Consumer, Safety and Reliability Act, which allows for the
use of a rider to recover costs of certain natural gas infrastructure
investments made between rate cases;
-- the effects of increased competition in the future due to, among other
things, deregulation of certain aspects of our business at either the
state or federal levels and the implementation of deregulation;
-- changes in laws and other governmental actions, including monetary,
fiscal, and tax policies;
-- the effects on demand for our services resulting from technological
advances, including advances in energy efficiency and distributed
generation sources, which generate electricity at the site of
consumption;
-- the effectiveness of Ameren Missouri's energy efficiency programs and
the ability to earn incentive awards under the Missouri Energy
Efficiency Investment Act;
-- the timing of increasing capital expenditure and operating expense
requirements and our ability to timely recover these costs;
-- the cost and availability of fuel such as coal, natural gas, and
enriched uranium used to produce electricity; the cost and availability
of purchased power and natural gas for distribution; and the level and
volatility of future market prices for such commodities, including our
ability to recover the costs for such commodities;
-- the effectiveness of our risk management strategies and the use of
financial and derivative instruments;
-- business and economic conditions, including their impact on interest
rates, bad debt expense, and demand for our products;
-- disruptions of the capital markets, deterioration in our credit metrics,
or other events that may have an adverse effect on the cost or
availability of capital, including short-term credit and liquidity;
-- our assessment of our liquidity;
-- the impact of the adoption of new accounting guidance and the
application of appropriate technical accounting rules and guidance;
-- actions of credit rating agencies and the effects of such actions;
-- the impact of weather conditions and other natural phenomena on us and
our customers, including the impact of system outages;
-- generation, transmission, and distribution asset construction,
installation, performance, and cost recovery;
-- the effects of our increasing investment in electric transmission
projects and uncertainty as to whether we will achieve our expected
returns in a timely fashion, if at all;
-- the extent to which Ameren Missouri prevails in its claim against an
insurer in connection with its Taum Sauk pumped-storage hydroelectric
energy center incident;
-- the extent to which Ameren Missouri is permitted by its regulators to
recover in rates the investments it made in connection with additional
nuclear generation at its Callaway Energy Center;
-- operation of Ameren Missouri's Callaway Energy Center, including planned
and unplanned outages, and decommissioning costs;
-- the effects of strategic initiatives, including mergers, acquisitions
and divestitures, and any related tax implications;
-- the impact of current environmental regulations and new, more stringent
or changing requirements, including those related to greenhouse gases,
other emissions and discharges, cooling water intake structures, coal
combustion residuals, and energy efficiency, that are enacted over time
and that could limit or terminate the operation of certain of our energy
centers, increase our costs or investment requirements, result in an
impairment of our assets, cause us to sell our assets, reduce our
customers' demand for electricity or natural gas, or otherwise have a
negative financial effect;
-- the impact of complying with renewable energy portfolio requirements in
Missouri;
-- labor disputes, workforce reductions, future wage and employee benefits
costs, including changes in discount rates, mortality tables, and
returns on benefit plan assets;
-- the inability of our counterparties to meet their obligations with
respect to contracts, credit agreements, and financial instruments;
-- the cost and availability of transmission capacity for the energy
generated by Ameren Missouri's energy centers or required to satisfy
Ameren Missouri's energy sales;
-- the inability of Dynegy Inc. and Illinois Power Holdings, LLC (IPH) to
satisfy their indemnity and other obligations to Ameren in connection
with the divestiture of New Ameren Energy Resources Generating Company,
LLC to IPH;
-- legal and administrative proceedings; and
-- acts of sabotage, war, terrorism, cyber attacks or intentionally
disruptive acts.
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 STATEMENT OF INCOME
(Unaudited, in millions, except per share amounts)
Three Months Ended Nine Months Ended
September 30, September 30,
------------- -------------
2014 2013 2014 2013
---- ---- ---- ----
Operating Revenues:
Electric $1,523 $1,507 $3,864 $3,823
Gas 147 131 819 693
--- --- --- ---
Total operating revenues 1,670 1,638 4,683 4,516
----- ----- ----- -----
Operating Expenses:
Fuel 236 222 638 648
Purchased power 112 128 335 400
Gas purchased for resale 49 42 432 344
Other operations and maintenance 404 383 1,236 1,229
Depreciation and amortization 187 175 551 528
Taxes other than income taxes 121 121 362 354
--- --- --- ---
Total operating expenses 1,109 1,071 3,554 3,503
----- ----- ----- -----
Operating Income 561 567 1,129 1,013
Other Income and Expense:
Miscellaneous income 21 20 60 51
Miscellaneous expense 7 5 20 18
--- --- --- ---
Total other income 14 15 40 33
Interest Charges 85 88 266 289
--- --- --- ---
Income Before Income Taxes 490 494 903 757
Income Taxes 194 187 357 288
--- --- --- ---
Income from Continuing Operations 296 307 546 469
Loss from Discontinued Operations, Net of
Taxes (1) (3) (3) (212)
--- --- --- ----
Net Income 295 304 543 257
Less: Net Income from Continuing
Operations Attributable to Noncontrolling
Interests 2 2 5 5
--- --- --- ---
Net Income (Loss) Attributable to Ameren Corporation:
Continuing Operations 294 305 541 464
Discontinued Operations (1) (3) (3) (212)
--- --- --- ----
Net Income Attributable to Ameren
Corporation $293 $302 $538 $252
--------------------------------- ---- ---- ---- ----
Earnings (Loss) per Common Share - Basic:
Continuing Operations $1.21 $1.26 $2.23 $1.92
Discontinued Operations - (0.01) (0.01) (0.88)
--- ----- ----- -----
Earnings per Common Share - Basic $1.21 $1.25 $2.22 $1.04
Earnings (Loss) per Common Share - Diluted:
Continuing Operations $1.20 $1.25 $2.21 $1.91
Discontinued Operations - (0.01) (0.01) (0.88)
--- ----- ----- -----
Earnings per Common Share - Diluted $1.20 $1.24 $2.20 $1.03
Average Common Shares Outstanding - Basic 242.6 242.6 242.6 242.6
Average Common Shares Outstanding - Diluted 244.3 245.1 244.3 244.4
------------------------------------------- ----- ----- ----- -----
AMEREN CORPORATION (AEE)
CONSOLIDATED BALANCE SHEET
(Unaudited, in millions)
September 30, December 31,
2014 2013
---- ----
ASSETS
Current Assets:
Cash and cash equivalents $13 $30
Accounts receivable -trade (less allowance for
doubtful accounts) 467 404
Unbilled revenue 203 304
Miscellaneous accounts and notes receivable 117 196
Materials and supplies 561 526
Current regulatory assets 199 156
Current accumulated deferred income taxes, net 301 106
Other current assets 66 85
Assets of discontinued operations 15 165
--- ---
Total current assets 1,942 1,972
----- -----
Property and Plant, Net 16,991 16,205
Investments and Other Assets:
Nuclear decommissioning trust fund 529 494
Goodwill 411 411
Intangible assets 20 22
Regulatory assets 1,259 1,240
Other assets 724 698
--- ---
Total investments and other assets 2,943 2,865
---------------------------------- ----- -----
TOTAL ASSETS $21,876 $21,042
------------ ------- -------
LIABILITIES AND EQUITY
Current Liabilities:
Current maturities of long-term debt $119 $534
Short-term debt 753 368
Accounts and wages payable 466 806
Taxes accrued 161 55
Interest accrued 105 86
Current regulatory liabilities 132 216
Other current liabilities 350 351
Liabilities of discontinued operations 33 45
---
Total current liabilities 2,119 2,461
----- -----
Long-term Debt, Net 5,825 5,504
Deferred Credits and Other Liabilities:
Accumulated deferred income taxes, net 3,845 3,250
Accumulated deferred investment tax credits 59 63
Regulatory liabilities 1,805 1,705
Asset retirement obligations 385 369
Pension and other postretirement benefits 400 466
Other deferred credits and liabilities 522 538
Total deferred credits and other liabilities 7,016 6,391
----- -----
Ameren Corporation Stockholders' Equity:
Common stock 2 2
Other paid-in capital, principally premium on
common stock 5,612 5,632
Retained earnings 1,154 907
Accumulated other comprehensive income 6 3
--- ---
Total Ameren Corporation stockholders' equity 6,774 6,544
Noncontrolling Interests 142 142
--- ---
Total equity 6,916 6,686
------------ ----- -----
TOTAL LIABILITIES AND EQUITY $21,876 $21,042
---------------------------- ------- -------
AMEREN CORPORATION (AEE)
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
(Unaudited, in millions)
Nine Months Ended
September 30,
-------------
2014 2013
---- ----
Cash Flows From Operating Activities:
Net income $543 $257
Loss from discontinued operations, net of
taxes 3 212
Adjustments to reconcile net income to net cash provided by operating
activities:
Depreciation and amortization 526 500
Amortization of nuclear fuel 70 46
Amortization of debt issuance costs and
premium/discounts 16 18
Deferred income taxes and investment tax
credits, net 370 258
Allowance for equity funds used during
construction (26) (26)
Stock-based compensation costs 20 19
Other (9) 14
Changes in assets and liabilities (305) (83)
---- ---
Net cash provided by operating activities -
continuing operations 1,208 1,215
Net cash provided by (used in) operating
activities -discontinued operations (5) 99
Net cash provided by operating activities 1,203 1,314
----------------------------------------- ----- -----
Cash Flows From Investing Activities:
Capital expenditures (1,310) (943)
Nuclear fuel expenditures (28) (34)
Purchases of securities -nuclear
decommissioning trust fund (365) (147)
Sales and maturities of securities -nuclear
decommissioning trust fund 354 134
Proceeds from note receivable -Illinois
Power Marketing Company 79 -
Contributions to note receivable -Illinois
Power Marketing Company (84) -
Other 3 (1)
--- ---
Net cash used in investing activities -
continuing operations (1,351) (991)
Net cash provided by (used in) investing
activities -discontinued operations 139 (42)
Net cash used in investing activities (1,212) (1,033)
------------------------------------- ------ ------
Cash Flows From Financing Activities:
Dividends on common stock (291) (291)
Dividends paid to noncontrolling interest
holders (5) (5)
Short-term debt, net 385 -
Redemptions of long-term debt (692) -
Issuances of long-term debt 598 -
Capital issuance costs (4) -
Other 1 -
--- ---
Net cash used in financing activities -
continuing operations (8) (296)
Net cash used in financing activities -
discontinued operations - -
Net cash used in financing activities (8) (296)
------------------------------------- --- ----
Net change in cash and cash equivalents (17) (15)
Cash and cash equivalents at beginning of
year 30 209
--- ---
Cash and cash equivalents at end of period 13 194
Less cash and cash equivalents at end of
period -discontinued operations - 25
---------------------------------------- --- ---
Cash and cash equivalents at end of period -
continuing operations $13 $169
-------------------------------------------- --- ----
AMEREN CORPORATION (AEE)
OPERATING STATISTICS FROM CONTINUING OPERATIONS
Three Months Ended Nine Months Ended
September 30, September 30,
------------- -------------
2014 2013 2014 2013
---- ---- ---- ----
Electric Sales -
kilowatthours (in
millions):
Ameren Missouri
Residential 3,400 3,579 10,479 10,244
Commercial 3,984 4,060 11,206 11,123
Industrial 2,233 2,290 6,511 6,539
Other 29 28 89 89
---
Native load subtotal 9,646 9,957 28,285 27,995
Off-system and wholesale 1,895 985 4,786 4,653
Subtotal 11,541 10,942 33,071 32,648
------
Ameren Illinois
Residential
Power supply and delivery
service 1,199 1,230 3,440 4,375
Delivery service only 1,798 1,984 5,631 4,481
Commercial
Power supply and delivery
service 649 676 1,933 1,956
Delivery service only 2,589 2,688 7,230 7,121
Industrial
Power supply and delivery
service 416 417 1,340 1,273
Delivery service only 2,732 2,727 7,920 8,133
Other 119 130 386 395
---
Native load subtotal 9,502 9,852 27,880 27,734
Eliminate affiliate sales (17) - (67) (41)
--- --- --- ---
Ameren Total from Continuing
Operations 21,026 20,794 60,884 60,341
----------------------------- ------ ------ ------ ------
Electric Revenues (in
millions):
Ameren Missouri
Residential $436 $459 $1,130 $1,130
Commercial 393 404 956 970
Industrial 152 160 373 387
Other 41 21 100 39
---
Native load subtotal 1,022 1,044 2,559 2,526
Off-system and wholesale 54 31 137 141
Subtotal $1,076 $1,075 $2,696 $2,667
--------
Ameren Illinois
Residential
Power supply and delivery
service $130 $123 $353 $413
Delivery service only 91 103 245 211
Commercial
Power supply and delivery
service 65 60 180 168
Delivery service only 55 63 143 143
Industrial
Power supply and delivery
service 19 17 71 53
Delivery service only 11 11 31 34
Other 74 55 139 138
---
Native load subtotal 445 432 1,162 1,160
Eliminate affiliate revenues
and other 2 - 6 (4)
---
Ameren Total from Continuing
Operations $1,523 $1,507 $3,864 $3,823
----------------------------- ------ ------ ------ ------
Electric Generation -
megawatthours (in
millions):
Ameren Missouri 11.7 11.1 33.7 32.6
--------------- ---- ---- ---- ----
Fuel Cost per kilowatthour
(cents):
Ameren Missouri 1.951 1.933 1.919 1.856
--------------- ----- ----- ----- -----
Gas Sales -decatherms (in
thousands):
Ameren Missouri 2,257 2,292 13,550 13,368
Ameren Illinois 23,823 24,100 130,131 119,496
------
Ameren Total 26,080 26,392 143,681 132,864
------------ ------ ------ ------- -------
Net Income (Loss) by Segment
(in millions):
Ameren Missouri $222 $238 $395 $362
Ameren Illinois 75 77 156 139
Other (3) (10) (10) (37)
---
Ameren Total $294 $305 $541 $464
------------ ---- ---- ---- ----
September 30, December 31,
2014 2013
---- ----
Common Stock:
Shares outstanding (in
millions) 242.6 242.6
Book value per share $27.92 $26.97
Capitalization Ratios:
Common equity 49.8% 50.1%
Preferred stock 1.0% 1.1%
Debt, net of cash 49.2% 48.8%
SOURCE Ameren Corporation
