EX-99 2 pressrelease72904.txt AMEREN PRESS RELEASE 7-29-04 Exhibit 99.1 [GRAPHIC OMITTED][GRAPHIC OMITTED] One Ameren Plaza 1901 Chouteau Avenue St. Louis, MO 63103 Contact: Media Analysts Investors Tim Fox Bruce Steinke Investor Services (314) 554-3120 (314) 554-2574 (800) 255-2237 tfox2@ameren.com bsteinke@ameren.com invest@ameren.com FOR IMMEDIATE RELEASE --------------------- AMEREN REPORTS SECOND QUARTER 2004 EARNINGS Updates 2004 Earnings Guidance St. Louis, Mo., July 29, 2004---Ameren Corporation (NYSE: AEE) today announced second quarter 2004 net income of $118 million, or 65 cents per share, compared to second quarter 2003 net income of $110 million, or 68 cents per share. Net income for the first six months of 2004 was $215 million, or $1.20 per share, compared to $211 million, or $1.32 per share, in the first half of 2003. Net income in the first six months of last year included an after-tax gain of $18 million, or 11 cents per share, due to the adoption of an accounting standard related to asset retirement obligations. Income in the first six months of 2003 before the cumulative effect of this change in an accounting principle was $193 million, or $1.21 per share. "Despite some challenges during the second quarter this year, we once again delivered solid financial results," said Gary L. Rainwater, chairman, chief executive officer and president of Ameren Corporation. "This quarter's earnings per share were down from the prior year due largely to the incremental costs we incurred in connection with the scheduled refueling and maintenance outage at our Callaway nuclear plant. A similar Callaway outage did not occur in 2003. In addition, earnings per share were lower due to the equity dilution principally caused by our issuance of common shares to prefund the Illinois Power acquisition. Despite these factors, second quarter earnings per share were only modestly below the prior year as solid organic growth, a return to more normal summer weather, stronger power prices and our focus on cost control largely offset the cost of the Callaway outage and earnings per share dilution," Mr. Rainwater added. Revenues in the second quarter of 2004 increased $64 million to $1.2 billion, compared to the same period in 2003. Solid organic growth in the company's service territory and a return to more normal summer weather as compared to the prior year largely drove higher revenues. In the second quarter of 2004, cooling degree days in Ameren's service territory increased -more - Add One approximately 75 percent from the cooler than normal second quarter last year. Weather-sensitive residential electric sales increased 15 percent, and commercial electric sales increased 6 percent in the second quarter of 2004 versus 2003. Interchange electric revenues also increased $15 million in the second quarter of 2004, as compared to the same period in 2003, due primarily to higher power prices. Wholesale electric revenues increased $13 million primarily due to the addition of new customers. Fuel and purchased power costs rose $43 million, and other operations and maintenance expenses increased $36 million in the second quarter of 2004 as compared to the second quarter of 2003. These increased costs were principally due to the Callaway nuclear plant's scheduled refueling and maintenance outage in the second quarter of 2004. A refueling outage occurs at the Callaway plant approximately every 18 months and there was no refueling and maintenance outage in 2003. This year's outage lasted 64 days and reduced quarterly earnings by an estimated 22 cents per share due to the incremental cost of fuel and replacement power and higher maintenance costs. Operations and maintenance expenses in the second quarter of 2004 benefited from the Federal Energy Regulatory Commission-ordered 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. Ameren continues to move towards completion of its proposed acquisition from Dynegy Inc. (NYSE: DYN) of Decatur, Ill.-based Illinois Power Company and a 20 percent interest in Electric Energy, Inc. "We are moving through regulatory approvals and remain on target to close the acquisition by the end of this year, if not sooner. Just yesterday, we received approval of the acquisition from the Federal Energy Regulatory Commission. In addition, we already have received approval from the Federal Communications Commission and the waiting period under the Hart-Scott-Rodino Act has expired. The acquisition must also be approved by the Illinois Commerce Commission and the Securities and Exchange Commission," noted Rainwater. In early July, Ameren sold 10.9 million new common shares, generating net proceeds of $445 million. "The proceeds from this offering, when combined with the $853 million of proceeds generated by our February 2004 common stock offering, completes our equity financing for the Illinois Power acquisition," added Warner L. Baxter, executive vice president and chief financial officer of Ameren. -more - Add Two Dilution and financing costs, principally resulting from additional common shares issued in the February offering, reduced earnings by an estimated 6 cents per share in the second quarter, and 9 cents per share in the first six months of 2004. Dilution was caused by shares being issued prior to the completion of the Illinois Power acquisition. Based on current assumptions, the acquisition, once completed, is expected to be accretive to earnings by 5 to 10 cents per share in each of the first two years after the closing of that transaction and is expected to provide significant, long-term value for all of Ameren's stakeholders. Due to the expected additional earnings dilution for the second half of 2004 of approximately 8 cents per share from the July common stock offering, Ameren announced today that the company is adjusting its 2004 guidance for earnings per share to between $2.70 and $2.90 per share. The 2004 estimate includes the impact of common shares issued in February and early July to fund the Illinois Power acquisition, but excludes any potential earnings impact resulting from the Illinois Power acquisition. The company's guidance is subject to, among other things, plant operations, weather conditions, energy market and economic conditions, unusual or otherwise unexpected gains or losses and other risks and uncertainties outlined in the company's Forward-Looking Statements section of this release. Ameren will conduct a conference call for financial analysts at 9:00 a.m. (Central Time) on Thursday, July 29, to discuss second quarter and year to date 2004 earnings and other matters relating 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 "Q2 2004 Earnings Conference Call," then the appropriate audio link. A slide presentation is also available on Ameren's website that reconciles earnings per share between the second quarter and first six months of 2003 and the same periods of 2004, and provides a summary of Ameren's 2004 earnings guidance. To access this presentation, simply follow the links for the webcast, and then click on the link for the presentation, which 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), July 29, until August 5 by dialing, U.S. (800) 428-6051; international (973) 709-2089, and entering the number: 366596. With assets of $14.7 billion, Ameren owns a diverse mix of electric generating plants strategically located in its Midwest market with a capacity of more than 14,600 megawatts. Ameren serves 1.7 million electric customers and 500,000 natural gas customers in a 49,000 square-mile area of Missouri and Illinois. -more- 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. These per share amounts reflect certain factors that directly impact Ameren's total earnings. Ameren believes this per share information is useful because it enables readers to better understand the impact of these factors on the company'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, the company is 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 filings with the Securities and Exchange Commission, could cause actual results to differ materially from management expectations as suggested by such "forward-looking" statements: o the closing and timing of Ameren's acquisition of Illinois Power and the impact of any conditions imposed by regulators in connection with their approval thereof; o the effects of the stipulation and agreement relating to the AmerenUE Missouri electric excess earnings complaint case and other regulatory actions, including changes in regulatory policies; o changes in laws and other governmental actions, including monetary and fiscal policies; o the impact on the company of current regulations related to the opportunity for customers to choose alternative energy suppliers in Illinois; o the effects of increased competition in the future due to, among other things, deregulation of certain aspects of the company's business at both the state and federal levels; o the effects of participation in a Federal Energy Regulatory Commission-approved regional transmission organization, including activities associated with the Midwest Independent System Operator; o 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; o the use of financial and derivative instruments; o average rates for electricity in the Midwest; o business and economic conditions; o the impact of the adoption of new accounting standards and the application of appropriate technical accounting rules and guidance; o interest rates and the availability of capital; o actions of ratings agencies and the effects of such actions; o weather conditions; o generation plant construction, installation and performance; o operation of nuclear power facilities, including planned and unplanned outages, and decommissioning costs; o the effects of strategic initiatives, including acquisitions and divestitures; o 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; o future wages and employee benefits costs, including changes in returns on benefit plan assets; o disruptions of the capital markets or other events making the company's access to necessary capital more difficult or costly; o competition from other generating facilities, including new facilities that may be developed; o difficulties in integrating AmerenCILCO and Illinois Power, if consummated, with the company's other businesses; o changes in the energy markets, environmental laws or regulations, interest rates or other factors adversely impacting assumptions in connection with the CILCORP and Illinois Power (if consummated) acquisitions; o cost and availability of transmission capacity for the energy generated by the company's generating facilities or required to satisfy energy sales made by the company; and o legal and administrative proceedings. # # #
AMEREN CORPORATION (AEE) CONSOLIDATED OPERATING STATISTICS Three Months Ended Six Months Ended June 30, June 30, ----------------------------- ----------------------------- 2004 2003 2004 2003 ------------ ------------ ------------ ---------- Electric Sales - KWH (in millions): Residential 3,984 3,469 8,927 8,219 Commercial 4,877 4,600 9,696 9,124 Industrial 4,448 4,438 8,771 8,226 Wholesale 2,197 1,967 4,687 4,253 Other 73 70 157 148 ------------ ------------ ------------ ---------- Native 15,579 14,544 32,238 29,970 Interchange sales 2,077 2,000 4,501 4,421 EEI (outside sales) 1,229 1,456 2,106 2,225 ------------ ------------ ------------ ---------- Total 18,885 18,000 38,845 36,616 Electric Revenues - (in millions): Residential $ 312 $ 281 $ 598 $ 555 Commercial 316 302 557 529 Industrial 190 192 354 327 Wholesale 79 66 164 141 Other 6 6 13 12 ------------ ------------ ------------ ---------- Native 903 847 1,686 1,564 Interchange sales 72 57 157 158 EEI (outside sales) 31 42 47 60 Other 26 22 55 42 ------------ ------------ ------------ ---------- Total 1,032 968 1,945 1,824 Power Supply (%): Fossil 83.9 73.8 81.4 77.3 Nuclear 3.1 13.3 6.5 12.4 Hydro 1.8 1.5 1.7 1.1 Purchased 11.2 11.4 10.4 9.2 Fuel Cost per KWH (cents) 1.142 1.074 1.108 1.030 Gas Sales - MMBTU (in thousands) 12,314 16,697 47,350 43,762 June 30, December 31, 2004 2003 ------------ ------------- Common Stock: Shares outstanding (in millions) 183.3 162.9 Book value per share $ 28.58 $ 26.73 Capitalization Ratios: Common equity 56.3% 47.5% Preferred stock 2.0% 2.0% Debt, net of cash 41.7% 50.5%
AMEREN CORPORATION (AEE) CONSOLIDATED BALANCE SHEET (Unaudited, in millions) June 30, December 31, 2004 2003 ----------------------------------------------------------------------------------------------------------- ASSETS ----------------------------------------------------------------------------------------------------------- Current Assets: Cash and cash equivalents $ 511 $ 111 Accounts receivable - trade 343 326 Unbilled revenue 258 221 Miscellaneous accounts and notes receivable 47 126 Materials and supplies, at average cost 458 487 Other current assets 35 46 ------------------ ----------------- Total current assets 1,652 1,317 ------------------ ----------------- Property and Plant, Net 11,052 10,920 Investments and Other Non-Current Assets: Investments in leveraged leases 153 164 Nuclear decommissioning trust fund 220 212 Goodwill and other intangibles, net 565 574 Other assets 353 320 ------------------ ----------------- Total investments and other assets 1,291 1,270 ------------------ ----------------- Regulatory Assets 682 729 ----------------------------------------------------------------------------------------------------------- TOTAL ASSETS $ 14,677 $ 14,236 =========================================================================================================== LIABILITIES AND STOCKHOLDERS' EQUITY ----------------------------------------------------------------------------------------------------------- Current Liabilities: Current maturities of long-term debt $ 291 $ 498 Short-term debt 35 161 Accounts and wages payable 273 480 Taxes accrued 220 103 Other current liabilities 215 215 ------------------ ----------------- Total current liabilities 1,034 1,457 ------------------ ----------------- Long-term Debt, Net 4,051 4,070 Preferred Stock Subject to Mandatory Redemption 21 21 Deferred Credits and Other Non-Current Liabilities: Accumulated deferred income taxes, net 1,775 1,853 Accumulated deferred investment tax credits 145 151 Regulatory liabilities 862 824 Asset retirement obligations 425 413 Accrued pension and other post-retirement benefits 744 699 Other deferred credits and liabilities 175 190 ------------------ ----------------- Total deferred credits and other liabilities 4,126 4,130 ------------------ ----------------- Preferred Stock Not Subject to Mandatory Redemption 182 182 Minority Interest in Consolidated Subsidiaries 25 22 Stockholders' Equity: Common stock 2 2 Other paid-in capital, principally premium on common stock 3,456 2,552 Retained earnings 1,835 1,853 Accumulated other comprehensive income (loss) (41) (44) Other (14) (9) ------------------ ----------------- Total stockholders' equity 5,238 4,354 ----------------------------------------------------------------------------------------------------------- TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 14,677 $ 14,236 ===========================================================================================================
AMEREN CORPORATION (AEE) CONSOLIDATED STATEMENT OF INCOME (Unaudited, in millions, except per share amounts) Three Months Ended Six Months Ended June 30, June 30, ---------------------- ----------------------- 2004 2003 2004 2003 ---------------------------------------------------------------------------------------------------------------------------------- Operating Revenues: Electric $ 1 ,032 $ 968 $ 1,945 $ 1,824 Gas 119 118 420 368 Other 1 2 3 4 --------- --------- --------- --------- Total operating revenues 1,152 1,088 2,368 2,196 Operating Expenses: ---------------------------------------------------------------------------------------------------------------------------------- Fuel and purchased power 282 239 553 471 Gas purchased for resale 75 83 288 264 Other operations and maintenance 343 307 649 599 Depreciation and amortization 132 132 262 256 Taxes other than income taxes 74 77 154 155 --------- --------- --------- --------- Total operating expenses 906 838 1,906 1,745 --------- --------- --------- --------- Operating Income 246 250 462 451 ---------------------------------------------------------------------------------------------------------------------------------- Other Income and (Deductions): ---------------------------------------------------------------------------------------------------------------------------------- Miscellaneous income 4 5 12 11 Miscellaneous expense (4) (7) (5) (10) --------- --------- --------- --------- Total other income and (deductions) - (2) 7 1 --------- --------- --------- --------- Interest Charges and Preferred Dividends: ---------------------------------------------------------------------------------------------------------------------------------- Interest 66 69 130 135 Preferred dividends of subsidiaries 2 2 5 5 --------- --------- --------- --------- Net interest charges and preferred dividends 68 71 135 140 --------- --------- --------- --------- Income Before Income Taxes and Cumulative Effect of Change in Accounting Principle 178 177 334 312 ---------------------------------------------------------------------------------------------------------------------------------- Income Taxes 60 67 119 119 --------- --------- --------- --------- Income Before Cumulative Effect of Change in Accounting Principle 118 110 215 193 ---------------------------------------------------------------------------------------------------------------------------------- Cumulative Effect of Change in Accounting Principle, Net of Income Taxes - - - 18 ---------------------------------------------------------------------------------------------------------------------------------- Net Income $ 118 $ 110 $ 215 $ 211 ================================================================================================================================== Earnings per Common Share - Basic and Diluted: Income before cumulative effect of change in accounting principle $ 0.65 $ 0.68 $ 1.20 $ 1.21 Cumulative effect of change in accounting principle, net of income taxes - - - 0.11 --------- --------- --------- --------- Earnings per Common Share - Basic and Diluted: $ 0.65 $ 0.68 $ 1.20 $ 1.32 ================================================================================================================================== Average Common Shares Outstanding 182.7 161.2 178.5 160.1 ==================================================================================================================================
AMEREN CORPORATION (AEE) CONSOLIDATED STATEMENT OF CASH FLOWS (Unaudited, in millions) Six Months Ended June 30, ----------------------- 2004 2003 -------------------------------------------------------------------------------------------------------------------- Cash Flows From Operating Activities: -------------------------------------------------------------------------------------------------------------------- Net income $ 215 $ 211 Adjustments to reconcile net income to net cash provided by operating activities: Cumulative effect of change in accounting principle - (18) Depreciation and amortization 262 256 Amortization of nuclear fuel 13 16 Amortization of debt issuance costs and premium/discounts 5 5 Deferred income taxes, net (5) (9) Deferred investment tax credits, net (6) (6) Coal contract settlement 18 - Changes in assets and liabilities, excluding the effects of the acquisitions: Receivables, net (23) 6 Materials and supplies 29 (14) Accounts and wages payable (162) (149) Taxes accrued 117 99 Assets, other (57) 17 Liabilities, other 29 27 Other 1 (11) -------- -------- Net cash provided by operating activities 436 430 -------------------------------------------------------------------------------------------------------------------- Cash Flows From Investing Activities: -------------------------------------------------------------------------------------------------------------------- Construction expenditures (379) (332) Acquisitions, net of cash acquired - (489) Nuclear fuel expenditures (5) (1) Other 17 6 -------- -------- Net cash used in investing activities (367) (816) -------------------------------------------------------------------------------------------------------------------- Cash Flows From Financing Activities: -------------------------------------------------------------------------------------------------------------------- Dividends on common stock (232) (205) Capital issuance costs (23) (11) Redemptions, Repurchases and Maturities: Nuclear fuel lease (67) (20) Short-term debt (126) (91) Long-term debt (260) (420) Issuances: Common stock 935 308 Long-term debt 104 298 -------- -------- Net cash provided by (used in) financing activities 331 (141) -------------------------------------------------------------------------------------------------------------------- Net Change In Cash and Cash Equivalents 400 (527) Cash and Cash Equivalents at Beginning of Year 111 628 -------------------------------------------------------------------------------------------------------------------- Cash and Cash Equivalents at End of Period $ 511 $ 101 ====================================================================================================================