Commission File Number | Registrant; State of Incorporation; Address and Telephone Number | IRS Employer Identification No. |
1-37388 | Talen Energy Corporation (Exact name of Registrant as specified in its charter) (Delaware) 835 Hamilton Street Suite 150 Allentown, PA 18101-1179 (888) 211-6011 | 47-1197305 |
[ ] | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |
[ ] | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |
[ ] | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | |
[ ] | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
99.1 | Press release, dated August 11, 2015. |
TALEN ENERGY CORPORATION | |||
By: | /s/ J. Matt Simmons, Jr. | ||
J. Matt Simmons, Jr. Vice President - Chief Accounting and Risk Officer |
• | Adjusted EBITDA of $171 million for three months ended June 30 |
• | Adjusted EBITDA of $408 million for six months ended June 30 |
• | Adjusted Free Cash Flow of $148 million for six months ended June 30 |
• | Affirmed 2015 guidance ranges for Adjusted EBITDA of $935-$1,085 million and Adjusted Free Cash Flow of $265-$415 million1 |
• | Affirmed 2016 midpoint projections for Adjusted EBITDA of $990 million and Adjusted Free Cash Flow of $310 million2 |
• | Announced agreement in July to acquire MACH Gen’s more than 2,500 megawatts of natural gas-fired generating capacity; transaction expected to close by year-end |
• | On track to meet 2015 synergies; increased run-rate synergies target to $165-$175 million |
• | Susquehanna Unit 1 achieved 101 percent capacity factor in second quarter, 99.8 percent over rolling 12-month period; Susquehanna Unit 2 completed refueling outage that included installation of modified turbine blades |
• | Root cause analysis of Susquehanna turbine issues confirmed short blade replacements restore full blade strength for normal operations and longevity; no further unplanned turbine outages expected |
1 | Reflects results of RJS Power operations for all of 2015, including the five months prior to acquisition. |
2 | Assumes closing of MACH Gen acquisition and sale of Talen Renewable Energy by Dec. 31, 2015. |
(in millions) | 2nd Quarter | Year to Date | |||||||||||||||
2015 | 2014 | 2015 | 2014 | ||||||||||||||
Operating Income (Loss) | |||||||||||||||||
East | $ | 132 | $ | 86 | $ | 362 | $ | 65 | |||||||||
West | (6 | ) | — | (6 | ) | — | |||||||||||
Other(2) | (92 | ) | (70 | ) | (144 | ) | (128 | ) | |||||||||
Total | $ | 34 | $ | 16 | $ | 212 | $ | (63 | ) | ||||||||
EBITDA(1) | |||||||||||||||||
East | $ | 220 | $ | 168 | $ | 534 | $ | 227 | |||||||||
West | (3 | ) | — | (3 | ) | — | |||||||||||
Other(2) | (92 | ) | (69 | ) | (144 | ) | (126 | ) | |||||||||
Total | $ | 125 | $ | 99 | $ | 387 | $ | 101 | |||||||||
Adjusted EBITDA(1) | |||||||||||||||||
East | $ | 202 | $ | 170 | $ | 488 | $ | 453 | |||||||||
West | 2 | — | 2 | — | |||||||||||||
Other(2) | (33 | ) | (44 | ) | (82 | ) | (92 | ) | |||||||||
Total | $ | 171 | $ | 126 | $ | 408 | $ | 361 |
June YTD 2015 | June YTD 2014 | |||||||
Cash from Operations | $ | 355 | $ | 290 | ||||
Adjusted Free Cash Flow | $ | 148 | $ | 125 |
June 30, 2015 | Dec. 31, 2014 | ||||||
Cash and cash equivalents | $ | 352 | $ | 352 | |||
Short-term debt | — | 630 |
2015 | 2014 | Change - Cash | |||||||||
Operating activities | $ | 355 | $ | 290 | $ | 65 | |||||
Investing activities | (127 | ) | (403 | ) | 276 | ||||||
Financing activities | (228 | ) | 138 | (366 | ) |
TALEN ENERGY CORPORATION AND SUBSIDIARIES | |||||||
CONDENSED CONSOLIDATED FINANCIAL INFORMATION (a) | |||||||
Condensed Consolidated Balance Sheets (Unaudited) | |||||||
(Millions of Dollars) | |||||||
June 30, | December 31, | ||||||
2015 | 2014 | ||||||
Assets | |||||||
Cash and cash equivalents | $ | 352 | $ | 352 | |||
Restricted cash and cash equivalents | 109 | 176 | |||||
Accounts receivable (less reserve: 2015, $2; 2014, $2) | 297 | 289 | |||||
Accounts receivable from affiliates | — | 36 | |||||
Unbilled revenues | 138 | 218 | |||||
Fuel, materials and supplies | 481 | 455 | |||||
Prepayments | 38 | 70 | |||||
Price risk management assets | 803 | 1,079 | |||||
Assets of discontinued operations | 394 | — | |||||
Other current assets | 9 | 26 | |||||
Investments | 985 | 980 | |||||
Property, Plant and Equipment | 14,137 | 12,235 | |||||
Less: accumulated depreciation | 6,348 | 6,242 | |||||
Property, plant and equipment, net | 7,789 | 5,993 | |||||
Construction work in progress | 374 | 443 | |||||
Total Property, Plant and Equipment, net | 8,163 | 6,436 | |||||
Goodwill | 470 | 72 | |||||
Other intangibles | 304 | 257 | |||||
Price risk management assets | 232 | 239 | |||||
Other noncurrent assets | 87 | 75 | |||||
Total Assets | $ | 12,862 | $ | 10,760 |
Liabilities and Equity | |||||||
Short-term debt | $ | — | $ | 630 | |||
Long-term debt due within one year | 884 | 535 | |||||
Accounts payable | 281 | 361 | |||||
Accounts payable to affiliates | — | 50 | |||||
Liabilities of discontinued operations | 18 | — | |||||
Other current liabilities | 1,113 | 1,314 | |||||
Long-term Debt | 3,175 | 1,683 | |||||
Deferred income taxes and investment tax credits | 1,509 | 1,250 | |||||
Price risk management liabilities - noncurrent | 199 | 193 | |||||
Accrued pension obligations | 247 | 299 | |||||
Asset retirement obligations | 474 | 415 | |||||
Other deferred credits and noncurrent liabilities | 136 | 123 | |||||
Predecessor Member's Equity (a) | — | 3,930 | |||||
Common stock and additional paid-in capital | 4,719 | — | |||||
Earnings reinvested | 90 | — | |||||
Accumulated other comprehensive income (loss) | 17 | (23 | ) | ||||
Total Liabilities and Equity | $ | 12,862 | $ | 10,760 |
(a) | The financial Statements in this news release have been condensed and summarized for purposes of presentation. Please refer to Talen Energy Corporation's periodic filings with the Securities and Exchange Commission for full financial statements, including note disclosures and certain defined terms used herein. |
TALEN ENERGY CORPORATION AND SUBSIDIARIES | |||||||||||||||
Condensed Consolidated Statements of Income (Unaudited) | |||||||||||||||
(Millions of Dollars, except share data) | |||||||||||||||
Three Months Ended | Six Months Ended | ||||||||||||||
June 30, | June 30, | ||||||||||||||
2015 | 2014 | 2015 | 2014 | ||||||||||||
Operating Revenues | |||||||||||||||
Wholesale energy | $ | 673 | $ | 551 | $ | 1,195 | $ | (906 | ) | ||||||
Wholesale energy to affiliate | 5 | 21 | 14 | 48 | |||||||||||
Retail energy | 243 | 280 | 554 | 630 | |||||||||||
Energy-related businesses | 144 | 155 | 248 | 280 | |||||||||||
Total Operating Revenues | 1,065 | 1,007 | 2,011 | 52 | |||||||||||
Operating Expenses | |||||||||||||||
Operation | |||||||||||||||
Fuel | 200 | 259 | 551 | 741 | |||||||||||
Energy purchases | 289 | 203 | 290 | (1,601 | ) | ||||||||||
Other operation and maintenance | 305 | 285 | 531 | 514 | |||||||||||
Depreciation | 87 | 76 | 164 | 151 | |||||||||||
Taxes, other than income | 15 | 13 | 30 | 31 | |||||||||||
Energy-related businesses | 135 | 155 | 233 | 279 | |||||||||||
Total Operating Expenses | 1,031 | 991 | 1,799 | 115 | |||||||||||
Operating Income (Loss) | 34 | 16 | 212 | (63 | ) | ||||||||||
Other Income (Expense) - net | 3 | 7 | 10 | 13 | |||||||||||
Interest Expense | 55 | 32 | 91 | 64 | |||||||||||
Income (Loss) from Continuing Operations Before Income Taxes | (18 | ) | (9 | ) | 131 | (114 | ) | ||||||||
Income Taxes | (43 | ) | (11 | ) | 10 | (58 | ) | ||||||||
Income (Loss) from Continuing Operations After Income Taxes | 25 | 2 | 121 | (56 | ) | ||||||||||
Income (Loss) from Discontinued Operations (net of income taxes) | 1 | 11 | 1 | 3 | |||||||||||
Net Income (Loss) | $ | 26 | $ | 13 | $ | 122 | $ | (53 | ) | ||||||
Earnings Per Share of Common Stock: | |||||||||||||||
Basic: | |||||||||||||||
Income (Loss) from continuing operations after income taxes | $ | 0.25 | $ | 0.03 | $ | 1.33 | $ | (0.67 | ) | ||||||
Income (Loss) from discontinued operations (net of income taxes) | 0.01 | 0.13 | 0.01 | 0.04 | |||||||||||
Net Income (Loss) | $ | 0.26 | $ | 0.16 | $ | 1.34 | $ | (0.63 | ) | ||||||
Diluted: | |||||||||||||||
Income (Loss) from continuing operations | $ | 0.25 | $ | 0.03 | $ | 1.33 | $ | (0.67 | ) | ||||||
Income (Loss) from discontinued operations (net of income taxes) | 0.01 | 0.13 | 0.01 | 0.04 | |||||||||||
Net Income (Loss) | $ | 0.26 | $ | 0.16 | $ | 1.34 | $ | (0.63 | ) | ||||||
Weighted-Average Shares of Common Stock Outstanding (in thousands) | |||||||||||||||
Basic | 98,354 | 83,524 | 90,980 | 83,524 | |||||||||||
Diluted | 98,376 | 83,524 | 91,002 | 83,524 |
TALEN ENERGY CORPORATION AND SUBSIDIARIES | |||||||
Condensed Consolidated Statement of Cash Flows (Unaudited) | |||||||
(Millions of Dollars) | |||||||
Six Months Ended | |||||||
June 30, | |||||||
2015 | 2014 | ||||||
Cash Flows from Operating Activities | |||||||
Net income (loss) | $ | 122 | $ | (53 | ) | ||
Adjustments to reconcile net income to net cash provided by operating activities | |||||||
Depreciation | 164 | 162 | |||||
Amortization | 99 | 77 | |||||
Defined benefit plans - expense | 23 | 32 | |||||
Deferred income taxes and investment tax credits | (46 | ) | (120 | ) | |||
Impairment of assets | 3 | 18 | |||||
Unrealized (gains) losses on derivatives, and other hedging activities | (40 | ) | 232 | ||||
Other | 35 | 10 | |||||
Change in current assets and current liabilities | |||||||
Accounts receivable | 50 | 25 | |||||
Accounts payable | (135 | ) | (55 | ) | |||
Unbilled revenues | 80 | 67 | |||||
Fuel, materials and supplies | 33 | 9 | |||||
Prepayments | 37 | (16 | ) | ||||
Counterparty collateral | 36 | (15 | ) | ||||
Price risk management assets and liabilities | (1 | ) | (33 | ) | |||
Other | (34 | ) | (29 | ) | |||
Other operating activities | |||||||
Defined benefit plans - funding | (74 | ) | (32 | ) | |||
Other | 3 | 11 | |||||
Net cash provided by operating activities | 355 | 290 | |||||
Cash Flows from Investing Activities | |||||||
Expenditures for property, plant and equipment | (179 | ) | (176 | ) | |||
Expenditures for intangible assets | (19 | ) | (24 | ) | |||
Purchases of nuclear plant decommissioning trust investments | (108 | ) | (73 | ) | |||
Proceeds from the sale of nuclear plant decommissioning trust investments | 100 | 65 | |||||
Proceeds from the receipt of grants | — | 56 | |||||
Net (increase) decrease in restricted cash and cash equivalents | 67 | (258 | ) | ||||
Other investing activities | 12 | 7 | |||||
Net cash provided by (used in) investing activities | (127 | ) | (403 | ) | |||
Cash Flows from Financing Activities | |||||||
Issuance of long-term debt | 600 | — | |||||
Contributions from member | 82 | 730 | |||||
Distributions to member | (214 | ) | (914 | ) | |||
Net increase (decrease) in short-term debt | (668 | ) | 324 | ||||
Other financing activities | (28 | ) | (2 | ) | |||
Net cash provided by (used in) financing activities | (228 | ) | 138 | ||||
Net Increase (Decrease) in Cash and Cash Equivalents | — | 25 | |||||
Cash and Cash Equivalents at Beginning of Period | 352 | 239 | |||||
Cash and Cash Equivalents at End of Period | $ | 352 | $ | 264 |
TALEN ENERGY CORPORATION AND SUBSIDIARIES | |||||||||||||||
Regulation G Reconciliations (Unaudited) | |||||||||||||||
Adjusted EBITDA | |||||||||||||||
(Millions of Dollars) | |||||||||||||||
Three Months Ended June 30, 2015 | |||||||||||||||
East | West | Other | Total | ||||||||||||
Net income (loss) | $ | 26 | |||||||||||||
(Income) loss from discontinued operations (net of tax) | (1 | ) | |||||||||||||
Interest expense | 55 | ||||||||||||||
Income taxes | (43 | ) | |||||||||||||
Other (income) expense - net | (3 | ) | |||||||||||||
Operating income (loss) | $ | 132 | $ | (6 | ) | $ | (92 | ) | $ | 34 | |||||
Depreciation | 83 | 3 | 1 | 87 | |||||||||||
Other income (expense) - net | 4 | — | (1 | ) | 3 | ||||||||||
Sapphire EBITDA (a) | 1 | — | — | 1 | |||||||||||
EBITDA | $ | 220 | $ | (3 | ) | $ | (92 | ) | $ | 125 | |||||
Unrealized (gain) loss on derivative contracts (b) | (12 | ) | 5 | — | (7 | ) | |||||||||
Stock-based compensation expense (c) | (8 | ) | — | 39 | 31 | ||||||||||
(Gain) loss from nuclear decommissioning trust funds | (4 | ) | — | — | (4 | ) | |||||||||
Asset retirement obligation accretion | 8 | — | — | 8 | |||||||||||
Transition Services Agreement costs | — | — | 5 | 5 | |||||||||||
Separation benefits | — | — | 2 | 2 | |||||||||||
Terminated derivative contracts (f) | (13 | ) | — | — | (13 | ) | |||||||||
Revenue adjustment (g) | 7 | — | — | 7 | |||||||||||
RJS transaction costs | — | — | 5 | 5 | |||||||||||
Restructuring costs (h) | — | — | 8 | 8 | |||||||||||
Other (i) | 4 | — | — | 4 | |||||||||||
Adjusted EBITDA | $ | 202 | $ | 2 | $ | (33 | ) | $ | 171 |
Six Months Ended June 30, 2015 | |||||||||||||||
East | West | Other | Total | ||||||||||||
Net income (loss) | $ | 122 | |||||||||||||
(Income) loss from discontinued operations (net of tax) | (1 | ) | |||||||||||||
Interest expense | 91 | ||||||||||||||
Income taxes | 10 | ||||||||||||||
Other (income) expense - net | (10 | ) | |||||||||||||
Operating income (loss) | $ | 362 | $ | (6 | ) | $ | (144 | ) | $ | 212 | |||||
Depreciation | 160 | 3 | 1 | 164 | |||||||||||
Other income (expense) - net | 11 | — | (1 | ) | 10 | ||||||||||
Sapphire EBITDA (a) | 1 | — | — | 1 | |||||||||||
EBITDA | $ | 534 | $ | (3 | ) | $ | (144 | ) | $ | 387 | |||||
Unrealized (gain) loss on derivative contracts (b) | (58 | ) | 5 | — | (53 | ) | |||||||||
Stock-based compensation expense (c) | — | — | 40 | 40 | |||||||||||
(Gain) loss from nuclear decommissioning trust funds | (10 | ) | — | — | (10 | ) | |||||||||
Asset retirement obligation accretion | 17 | — | — | 17 | |||||||||||
Transition Services Agreement costs | — | — | 5 | 5 | |||||||||||
Separation benefits | — | — | 2 | 2 | |||||||||||
Corette closure costs (e) | 4 | — | — | 4 | |||||||||||
Terminated derivative contracts (f) | (13 | ) | — | — | (13 | ) | |||||||||
Revenue adjustment (g) | 7 | — | — | 7 | |||||||||||
RJS transaction costs | — | — | 5 | 5 | |||||||||||
Restructuring costs (h) | — | — | 10 | 10 | |||||||||||
Other (i) | 7 | — | — | 7 | |||||||||||
Adjusted EBITDA | $ | 488 | $ | 2 | $ | (82 | ) | $ | 408 |
Three Months Ended June 30, 2014 | |||||||||||||||
East | West | Other | Total | ||||||||||||
Net income (loss) | $ | 13 | |||||||||||||
(Income) loss from discontinued operations (net of tax) | (11 | ) | |||||||||||||
Interest expense | 32 | ||||||||||||||
Income taxes | (11 | ) | |||||||||||||
Other (income) expense - net | (7 | ) | |||||||||||||
Operating income (loss) | $ | 86 | $ | — | $ | (70 | ) | $ | 16 | ||||||
Other income (expense) - net | 6 | — | 1 | 7 | |||||||||||
Depreciation | 76 | — | — | 76 | |||||||||||
EBITDA | $ | 168 | $ | — | $ | (69 | ) | $ | 99 | ||||||
Unrealized (gain) loss on derivative contracts (b) | (1 | ) | — | — | (1 | ) | |||||||||
Stock-based compensation expense (c) | — | — | 3 | 3 | |||||||||||
(Gain) loss from nuclear decommissioning trust funds | (5 | ) | — | — | (5 | ) | |||||||||
Asset retirement obligation accretion | 7 | — | — | 7 | |||||||||||
Separation benefits (e) | — | 22 | 22 | ||||||||||||
Other (i) | 1 | — | — | 1 | |||||||||||
Adjusted EBITDA | $ | 170 | $ | — | $ | (44 | ) | $ | 126 |
Six Months Ended June 30, 2014 | |||||||||||||||
East | West | Other | Total | ||||||||||||
Net income (loss) | $ | (53 | ) | ||||||||||||
(Income) loss from discontinued operations (net of tax) | (3 | ) | |||||||||||||
Interest expense | 64 | ||||||||||||||
Income taxes | (58 | ) | |||||||||||||
Other (income) expense - net | (13 | ) | |||||||||||||
Operating income (loss) | $ | 65 | $ | — | $ | (128 | ) | $ | (63 | ) | |||||
Other income (expense) net | 11 | 2 | 13 | ||||||||||||
Depreciation | 151 | — | — | 151 | |||||||||||
EBITDA | $ | 227 | $ | — | $ | (126 | ) | $ | 101 | ||||||
Unrealized (gain) loss on derivative contracts (b) | 218 | — | — | 218 | |||||||||||
Stock-based compensation expense (c) | — | — | 12 | 12 | |||||||||||
(Gain) loss from nuclear decommissioning trust funds | (11 | ) | — | — | (11 | ) | |||||||||
Asset retirement obligation accretion | 15 | — | — | 15 | |||||||||||
Separation benefits (d) | — | — | 22 | 22 | |||||||||||
Other (i) | 4 | — | — | 4 | |||||||||||
Adjusted EBITDA | $ | 453 | $ | — | $ | (92 | ) | $ | 361 |
(a) | Sapphire, excluding related heat rate call options, has been classified as discontinued operations since its June 1, 2015 acquisition. |
(b) | Represents unrealized gains (losses) on derivatives. Amounts have been adjusted for option premiums of $4 million and $9 million for the three and six months ended June 30, 2015 and insignificant amounts for the same periods in 2014. |
(c) | For periods prior to June 2015, represents the portion of PPL's stock-based compensation cost allocable to Talen Energy. Amounts for the 2014 periods were cash settled with a former affiliate. |
(d) | In June 2014, Talen Energy Supply's largest IBEW local ratified a new three-year labor agreement. In connection with the new agreement, estimated bargaining unit one-time voluntary retirement benefits were recorded. |
(e) | Operations were suspended and the Corette plant in Montana was retired in March 2015. |
(f) | Represents net realized gains on certain derivative contracts that were early-terminated due to the spinoff transaction. |
(g) | Relates to a prior period revenue adjustment for the receipt of revenue under a transmission operating agreement with Talen Energy Supply's former affiliate, PPL Electric Utilities Corporation. |
(h) | Costs related to the spinoff transaction, including FERC-required mitigation plan expenses and legal and professional fees. |
(i) | All periods include other comprehensive income amortization on non-active derivative positions and the 2015 periods include an asset write-off. |
TALEN ENERGY CORPORATION AND SUBSIDIARIES | ||||||||
Regulation G Reconciliations (Unaudited) | ||||||||
Adjusted Free Cash Flow | ||||||||
(Millions of Dollars) | ||||||||
June YTD 2015 | June YTD 2014 | |||||||
Cash from Operations | $ | 355 | $ | 290 | ||||
Sustenance Capital Expenditures | (191 | ) | (193 | ) | ||||
Counterparty collateral paid (received) | (31 | ) | 15 | |||||
Adjusted Free Cash Flow, including other adjustments | 133 | 112 | ||||||
Cash adjustments (after tax): | ||||||||
Transition Services Agreement costs | 3 | — | ||||||
Separation benefits | 1 | 13 | ||||||
Corette closure costs (a) | 2 | — | ||||||
RJS transaction costs | 3 | — | ||||||
Restructuring costs (b) | 6 | — | ||||||
Adjusted Free Cash Flow | $ | 148 | $ | 125 |
(a) | Operations were suspended and the Corette plant was retired in March 2015. |
(b) | Costs related to the spinoff transaction, including FERC-required mitigation plan expenses and legal and professional fees. |
TALEN ENERGY CORPORATION AND SUBSIDIARIES | ||||||||||||||||||||
Regulation G Reconciliations (Unaudited) | ||||||||||||||||||||
Adjusted EBITDA Projections | ||||||||||||||||||||
(Millions of Dollars) | ||||||||||||||||||||
Low - 2015E(a) | Midpoint - 2015E(a) | High - 2015E(a) | Midpoint 2016E(b) - Adjusted For MACH Gen | Midpoint 2016E (b)(c) - Adjusted for Sale of Talen Renewable Energy | ||||||||||||||||
Net Income/(Loss) | $ | 55 | $ | 100 | $ | 145 | $ | 107 | $ | 98 | ||||||||||
Income Taxes | 23 | 53 | 83 | 57 | 56 | |||||||||||||||
Interest Expense | 327 | 327 | 327 | 290 | 290 | |||||||||||||||
Depreciation & Amortization | 410 | 410 | 410 | 458 | 453 | |||||||||||||||
EBITDA | 815 | 890 | 965 | 912 | 897 | |||||||||||||||
Non-Cash Compensation | 23 | 23 | 23 | 21 | 21 | |||||||||||||||
Asset Retirement Obligation | 35 | 35 | 35 | 37 | 37 | |||||||||||||||
MTM losses (gains) | (28 | ) | (28 | ) | (28 | ) | — | — | ||||||||||||
Nuclear decommissioning trust losses (gains) | (10 | ) | (10 | ) | (10 | ) | (10 | ) | (10 | ) | ||||||||||
Adjusted EBITDA, including other adjustments | 835 | 910 | 985 | 960 | 945 | |||||||||||||||
Other adjustments: | ||||||||||||||||||||
Transition Services Agreement costs and allocations (d) | 75 | 75 | 75 | 45 | 45 | |||||||||||||||
Other (e) | 25 | 25 | 25 | — | — | |||||||||||||||
Adjusted EBITDA | $ | 935 | $ | 1,010 | $ | 1,085 | $ | 1,005 | $ | 990 |
(a) | 2015 forecasted amounts include twelve months of performance from RJS Power, including the five-month period prior to the acquisition and an adjustment for PPL allocations not expected to continue in future periods. |
(b) | Assumes MACH Gen transaction closes by 12/31/2015. |
(c) | Sale of Talen Renewable Energy expected by 12/31/2015. |
(d) | Low, midpoint, and high 2015 amounts include $40 million of allocations from PPL and $35 million of TSA costs that are not expected to continue in future periods. |
(e) | Restructuring costs that are not expected to continue in future period. |
TALEN ENERGY CORPORATION AND SUBSIDIARIES | ||||||||||||||||||||
Regulation G Reconciliations (Unaudited) | ||||||||||||||||||||
Adjusted Free Cash Flow Projections | ||||||||||||||||||||
(Millions of Dollars) | ||||||||||||||||||||
Low - 2015E | Midpoint - 2015E | High - 2015E | Midpoint 2016E(b) - Adjusted For MACH Gen | Midpoint 2016E (b)(c) - Adjusted for Sale of Talen Renewable Energy | ||||||||||||||||
Cash from Operations (a) | $ | 752 | $ | 797 | $ | 842 | $ | 782 | $ | 770 | ||||||||||
Capital Expenditures, excluding growth | (547 | ) | (517 | ) | (487 | ) | (489 | ) | (487 | ) | ||||||||||
Adjusted Free Cash Flow, including other adjustments | $ | 205 | $ | 280 | $ | 355 | $ | 293 | $ | 283 | ||||||||||
Cash adjustments (after tax): | ||||||||||||||||||||
Transition Services Agreement costs & allocations (d) | 45 | 45 | 45 | 27 | 27 | |||||||||||||||
Other (e) | 15 | 15 | 15 | — | — | |||||||||||||||
Adjusted Free Cash Flow (f) | $ | 265 | $ | 340 | $ | 415 | $ | 320 | $ | 310 |
(a) | 2015 forecasted amounts include twelve months of performance from RJS, including the five-month period prior to the acquisition and an adjustment for PPL allocations not expected to continue in future periods. |
(b) | Assumes MACH Gen transaction closes by 12/31/2015. |
(c) | Sale of Talen Renewable Energy expected by 12/31/2015. |
(d) | Low, midpoint, and high 2015 amounts includes $24 million of allocations from PPL and $21 million of TSA costs that are not expected to continue in future periods. |
(e) | Restructuring costs that are not expected to continue in future periods. |
(f) | Does not include growth capex of $48 million in 2015 and $84 million in 2016. |