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Equity
 3 Months Ended
Mar. 31, 2019
Equity
EQUITY (Entergy Corporation and Entergy Louisiana)

Common Stock

Earnings per Share

The following table presents Entergy’s basic and diluted earnings per share calculations included on the consolidated income statements:
 
 
 
 
 
 
 
 
 
 
 
 
 
For the Three Months Ended March 31,
 
2019
 
2018
 
(In Millions, Except Per Share Data)
 
Income
 
Shares
 
$/share
 
Income
 
Shares
 
$/share
Basic earnings per share
 
 
 
 
 
 
 
 
 
 
 
Net income attributable to Entergy Corporation

$254.5

 
189.6

 

$1.34

 

$132.8

 
180.7

 

$0.73

Average dilutive effect of:
 
 
 
 
 
 
 
 
 
 
 
Stock options
 
 
0.4

 
—

 
 
 
0.2

 
—

Other equity plans
 
 
0.5

 
(0.01
)
 
 
 
0.5

 
—

Equity forwards
 
 
1.7

 
(0.01
)
 
 
 
—

 
—

Diluted earnings per share

$254.5

 
192.2

 

$1.32

 

$132.8

 
181.4

 

$0.73



The number of stock options not included in the calculation of diluted common shares outstanding due to their antidilutive effect was approximately 0.7 million for the three months ended March 31, 2019 and approximately 4 million for the three months ended March 31, 2018.

Entergy’s stock options and other equity compensation plans are discussed in Note 5 to the financial statements herein and in Note 12 to the financial statements in the Form 10-K.

Dividends declared per common share were $0.91 for the three months ended March 31, 2019 and $0.89 for the three months ended March 31, 2018.

Equity Forward Sale Agreements

As discussed in Note 7 to the financial statements in the Form 10-K, in June 2018, Entergy marketed an equity offering of 15.3 million shares of common stock. In lieu of issuing equity at the time of the offering, Entergy entered into forward sale agreements with various investment banks. In December 2018, Entergy physically settled a portion of its obligations under the forward sale agreements by delivering 6,834,221 shares of common stock in exchange for cash proceeds of approximately $500 million. Entergy is required to settle its remaining obligations under the forward sale agreements with respect to the remaining 8,448,171 shares of common stock on a settlement date or dates on or prior to June 7, 2019.

Until settlement of the remaining equity forwards, earnings per share dilution resulting from the agreements, if any, will be determined under the treasury stock method. Share dilution occurs when the average market price of Entergy’s common stock is higher than the average forward sales price. If Entergy had elected to net share settle the forward sale agreements as of March 31, 2019, Entergy would have been required to deliver 2.0 million shares.

Treasury Stock

During the three months ended March 31, 2019, Entergy Corporation issued 860,093 shares of its previously repurchased common stock to satisfy stock option exercises, vesting of shares of restricted stock, and other stock-based awards.  Entergy Corporation did not repurchase any of its common stock during the three months ended March 31, 2019.

Retained Earnings

On April 3, 2019, Entergy Corporation’s Board of Directors declared a common stock dividend of $0.91 per share, payable on June 3, 2019, to holders of record as of May 9, 2019.

Entergy implemented ASU No. 2017-12 “Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities” effective January 1, 2019. The ASU makes a number of amendments to hedge accounting, most significantly changing the recognition and presentation of highly effective hedges. Entergy implemented this standard using a modified retrospective method, and recorded an adjustment increasing retained earnings and increasing accumulated other comprehensive loss by approximately $8 million as of January 1, 2019 for the cumulative effect of the ineffectiveness portion of designated hedges on nuclear power sales.

Entergy implemented ASU 2017-08 “Receivables (Topic 310): Nonrefundable Fees and Other Costs” effective January 1, 2019. The ASU amends the amortization period for certain purchased callable debt securities held at a premium to the earliest call date. Entergy implemented this standard using the modified retrospective approach, and recorded an adjustment decreasing retained earnings and decreasing accumulated other comprehensive loss by approximately $1 million as of January 1, 2019 for the cumulative effect of the amended amortization period.

Comprehensive Income

Accumulated other comprehensive income (loss) is included in the equity section of the balance sheets of Entergy and Entergy Louisiana. The following table presents changes in accumulated other comprehensive income (loss) for Entergy for the three months ended March 31, 2019 by component:
 
Cash flow
hedges
net
unrealized
gain (loss)
 
Pension
and
other
postretirement
liabilities
 
Net
unrealized
investment
gain (loss)
 
Total
Accumulated
Other
Comprehensive
Income (Loss)
 
(In Thousands)
Ending balance, December 31, 2018

($23,135
)
 

($531,922
)
 

($2,116
)
 

($557,173
)
Implementation of accounting standards
(7,685
)
 
—

 
879

 
(6,806
)
Beginning balance, January 1, 2019

($30,820
)
 

($531,922
)
 

($1,237
)
 

($563,979
)
 
 
 
 
 
 
 
 
Other comprehensive income (loss) before reclassifications
28,312

 
—

 
13,539

 
41,851

Amounts reclassified from accumulated other comprehensive income (loss)
(40,738
)
 
11,550

 
164

 
(29,024
)
Net other comprehensive income (loss) for the period
(12,426
)
 
11,550

 
13,703

 
12,827

Ending balance, March 31, 2019

($43,246
)
 

($520,372
)
 

$12,466

 

($551,152
)

The following table presents changes in accumulated other comprehensive income (loss) for Entergy for the three months ended March 31, 2018 by component:
 
Cash flow
hedges
net
unrealized
gain (loss)
 
Pension
and
other
postretirement
liabilities
 
Net
unrealized
investment
gain (loss)
 
Total
Accumulated
Other
Comprehensive
Income (Loss)
 
(In Thousands)
 
 
 
 
 
 
 
 
Ending balance, December 31, 2017

($37,477
)
 

($531,099
)
 

$545,045

 

($23,531
)
Implementation of accounting standards
—

 
—

 
(632,617
)
 
(632,617
)
Beginning balance, January 1, 2018

($37,477
)
 

($531,099
)
 

($87,572
)
 

($656,148
)
 
 
 
 
 
 
 
 
Other comprehensive income (loss) before reclassifications
71,566

 
—

 
838

 
72,404

Amounts reclassified from accumulated other comprehensive income (loss)
23,861

 
16,574

 
(33,694
)
 
6,741

Net other comprehensive income (loss) for the period
95,427

 
16,574

 
(32,856
)
 
79,145

 
 
 
 
 
 
 
 
Reclassification pursuant to ASU 2018-02
(7,756
)
 
(90,966
)
 
114,227

 
15,505

 
 
 
 
 
 
 
 
Ending balance, March 31, 2018

$50,194

 

($605,491
)
 

($6,201
)
 

($561,498
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

The following table presents changes in accumulated other comprehensive income (loss) for Entergy Louisiana for the three months ended March 31, 2019 and 2018:
 
 
Pension and Other
Postretirement Liabilities
 
 
2019
 
2018
 
 
(In Thousands)
Beginning balance, January 1,
 

($6,153
)
 

($46,400
)
Amounts reclassified from accumulated other
comprehensive income (loss)
 
(969
)
 
(501
)
Net other comprehensive income (loss) for the period
 
(969
)
 
(501
)
 
 
 
 
 
Reclassification pursuant to ASU 2018-02
 
—

 
(10,049
)
 
 
 
 
 
Ending balance, March 31,
 

($7,122
)
 

($56,950
)

 
 
 
 
 
 
Total reclassifications out of accumulated other comprehensive income (loss) (AOCI) into income for Entergy for the three months ended March 31, 2019 and 2018 are as follows:
 
Amounts reclassified
from AOCI
 
Income Statement Location
 
2019
 
2018
 
 
 
(In Thousands)
 
 
Cash flow hedges net unrealized gain (loss)
 
 
 
 
 
   Power contracts

$51,615

 

($30,082
)
 
Competitive business operating revenues
   Interest rate swaps
(48
)
 
(122
)
 
Miscellaneous - net
Total realized gain (loss) on cash flow hedges
51,567

 
(30,204
)
 
 
 
(10,829
)
 
6,343

 
Income taxes
Total realized gain (loss) on cash flow hedges (net of tax)

$40,738

 

($23,861
)
 
 
 
 
 
 
 
 
Pension and other postretirement liabilities
 
 
 
 
 
   Amortization of prior-service credit

$5,326

 

$5,426

 
(a)
   Amortization of loss
(18,988
)
 
(24,952
)
 
(a)
   Settlement loss
(1,137
)
 
(1,616
)
 
(a)
Total amortization
(14,799
)
 
(21,142
)
 
 
 
3,249

 
4,568

 
Income taxes
Total amortization (net of tax)

($11,550
)
 

($16,574
)
 
 
 
 
 
 
 
 
Net unrealized investment gain (loss)
 
 
 
 
 
Realized gain (loss)

($259
)
 

$53,314

 
Interest and investment income
 
95

 
(19,620
)
 
Income taxes
Total realized investment gain (loss) (net of tax)

($164
)
 

$33,694

 
 
 
 
 
 
 
 
Total reclassifications for the period (net of tax)

$29,024

 

($6,741
)
 
 

(a)
These accumulated other comprehensive income (loss) components are included in the computation of net periodic pension and other postretirement cost.  See Note 6 to the financial statements herein for additional details.

 
 
 
 
 
 
 

Total reclassifications out of accumulated other comprehensive income (loss) (AOCI) into income for Entergy Louisiana for the three months ended March 31, 2019 and 2018 are as follows:
 
 
Amounts reclassified
from AOCI
 
Income Statement Location
 
 
2019
 
2018
 
 
 
 
(In Thousands)
 
 
Pension and other postretirement liabilities
 
 
 
 
 
 
   Amortization of prior-service credit
 

$1,838

 

$1,934

 
(a)
   Amortization of loss
 
(527
)
 
(1,257
)
 
(a)
Total amortization
 
1,311

 
677

 
 
 
 
(342
)
 
(176
)
 
Income taxes
Total amortization (net of tax)
 
969

 
501

 
 
 
 
 
 
 
 
 
Total reclassifications for the period (net of tax)
 

$969

 

$501

 
 


(a)
These accumulated other comprehensive income (loss) components are included in the computation of net periodic pension and other postretirement cost.  See Note 6 to the financial statements herein for additional details.
Entergy Louisiana [Member]  
Equity
EQUITY (Entergy Corporation and Entergy Louisiana)

Common Stock

Earnings per Share

The following table presents Entergy’s basic and diluted earnings per share calculations included on the consolidated income statements:
 
 
 
 
 
 
 
 
 
 
 
 
 
For the Three Months Ended March 31,
 
2019
 
2018
 
(In Millions, Except Per Share Data)
 
Income
 
Shares
 
$/share
 
Income
 
Shares
 
$/share
Basic earnings per share
 
 
 
 
 
 
 
 
 
 
 
Net income attributable to Entergy Corporation

$254.5

 
189.6

 

$1.34

 

$132.8

 
180.7

 

$0.73

Average dilutive effect of:
 
 
 
 
 
 
 
 
 
 
 
Stock options
 
 
0.4

 
—

 
 
 
0.2

 
—

Other equity plans
 
 
0.5

 
(0.01
)
 
 
 
0.5

 
—

Equity forwards
 
 
1.7

 
(0.01
)
 
 
 
—

 
—

Diluted earnings per share

$254.5

 
192.2

 

$1.32

 

$132.8

 
181.4

 

$0.73



The number of stock options not included in the calculation of diluted common shares outstanding due to their antidilutive effect was approximately 0.7 million for the three months ended March 31, 2019 and approximately 4 million for the three months ended March 31, 2018.

Entergy’s stock options and other equity compensation plans are discussed in Note 5 to the financial statements herein and in Note 12 to the financial statements in the Form 10-K.

Dividends declared per common share were $0.91 for the three months ended March 31, 2019 and $0.89 for the three months ended March 31, 2018.

Equity Forward Sale Agreements

As discussed in Note 7 to the financial statements in the Form 10-K, in June 2018, Entergy marketed an equity offering of 15.3 million shares of common stock. In lieu of issuing equity at the time of the offering, Entergy entered into forward sale agreements with various investment banks. In December 2018, Entergy physically settled a portion of its obligations under the forward sale agreements by delivering 6,834,221 shares of common stock in exchange for cash proceeds of approximately $500 million. Entergy is required to settle its remaining obligations under the forward sale agreements with respect to the remaining 8,448,171 shares of common stock on a settlement date or dates on or prior to June 7, 2019.

Until settlement of the remaining equity forwards, earnings per share dilution resulting from the agreements, if any, will be determined under the treasury stock method. Share dilution occurs when the average market price of Entergy’s common stock is higher than the average forward sales price. If Entergy had elected to net share settle the forward sale agreements as of March 31, 2019, Entergy would have been required to deliver 2.0 million shares.

Treasury Stock

During the three months ended March 31, 2019, Entergy Corporation issued 860,093 shares of its previously repurchased common stock to satisfy stock option exercises, vesting of shares of restricted stock, and other stock-based awards.  Entergy Corporation did not repurchase any of its common stock during the three months ended March 31, 2019.

Retained Earnings

On April 3, 2019, Entergy Corporation’s Board of Directors declared a common stock dividend of $0.91 per share, payable on June 3, 2019, to holders of record as of May 9, 2019.

Entergy implemented ASU No. 2017-12 “Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities” effective January 1, 2019. The ASU makes a number of amendments to hedge accounting, most significantly changing the recognition and presentation of highly effective hedges. Entergy implemented this standard using a modified retrospective method, and recorded an adjustment increasing retained earnings and increasing accumulated other comprehensive loss by approximately $8 million as of January 1, 2019 for the cumulative effect of the ineffectiveness portion of designated hedges on nuclear power sales.

Entergy implemented ASU 2017-08 “Receivables (Topic 310): Nonrefundable Fees and Other Costs” effective January 1, 2019. The ASU amends the amortization period for certain purchased callable debt securities held at a premium to the earliest call date. Entergy implemented this standard using the modified retrospective approach, and recorded an adjustment decreasing retained earnings and decreasing accumulated other comprehensive loss by approximately $1 million as of January 1, 2019 for the cumulative effect of the amended amortization period.

Comprehensive Income

Accumulated other comprehensive income (loss) is included in the equity section of the balance sheets of Entergy and Entergy Louisiana. The following table presents changes in accumulated other comprehensive income (loss) for Entergy for the three months ended March 31, 2019 by component:
 
Cash flow
hedges
net
unrealized
gain (loss)
 
Pension
and
other
postretirement
liabilities
 
Net
unrealized
investment
gain (loss)
 
Total
Accumulated
Other
Comprehensive
Income (Loss)
 
(In Thousands)
Ending balance, December 31, 2018

($23,135
)
 

($531,922
)
 

($2,116
)
 

($557,173
)
Implementation of accounting standards
(7,685
)
 
—

 
879

 
(6,806
)
Beginning balance, January 1, 2019

($30,820
)
 

($531,922
)
 

($1,237
)
 

($563,979
)
 
 
 
 
 
 
 
 
Other comprehensive income (loss) before reclassifications
28,312

 
—

 
13,539

 
41,851

Amounts reclassified from accumulated other comprehensive income (loss)
(40,738
)
 
11,550

 
164

 
(29,024
)
Net other comprehensive income (loss) for the period
(12,426
)
 
11,550

 
13,703

 
12,827

Ending balance, March 31, 2019

($43,246
)
 

($520,372
)
 

$12,466

 

($551,152
)

The following table presents changes in accumulated other comprehensive income (loss) for Entergy for the three months ended March 31, 2018 by component:
 
Cash flow
hedges
net
unrealized
gain (loss)
 
Pension
and
other
postretirement
liabilities
 
Net
unrealized
investment
gain (loss)
 
Total
Accumulated
Other
Comprehensive
Income (Loss)
 
(In Thousands)
 
 
 
 
 
 
 
 
Ending balance, December 31, 2017

($37,477
)
 

($531,099
)
 

$545,045

 

($23,531
)
Implementation of accounting standards
—

 
—

 
(632,617
)
 
(632,617
)
Beginning balance, January 1, 2018

($37,477
)
 

($531,099
)
 

($87,572
)
 

($656,148
)
 
 
 
 
 
 
 
 
Other comprehensive income (loss) before reclassifications
71,566

 
—

 
838

 
72,404

Amounts reclassified from accumulated other comprehensive income (loss)
23,861

 
16,574

 
(33,694
)
 
6,741

Net other comprehensive income (loss) for the period
95,427

 
16,574

 
(32,856
)
 
79,145

 
 
 
 
 
 
 
 
Reclassification pursuant to ASU 2018-02
(7,756
)
 
(90,966
)
 
114,227

 
15,505

 
 
 
 
 
 
 
 
Ending balance, March 31, 2018

$50,194

 

($605,491
)
 

($6,201
)
 

($561,498
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

The following table presents changes in accumulated other comprehensive income (loss) for Entergy Louisiana for the three months ended March 31, 2019 and 2018:
 
 
Pension and Other
Postretirement Liabilities
 
 
2019
 
2018
 
 
(In Thousands)
Beginning balance, January 1,
 

($6,153
)
 

($46,400
)
Amounts reclassified from accumulated other
comprehensive income (loss)
 
(969
)
 
(501
)
Net other comprehensive income (loss) for the period
 
(969
)
 
(501
)
 
 
 
 
 
Reclassification pursuant to ASU 2018-02
 
—

 
(10,049
)
 
 
 
 
 
Ending balance, March 31,
 

($7,122
)
 

($56,950
)

 
 
 
 
 
 
Total reclassifications out of accumulated other comprehensive income (loss) (AOCI) into income for Entergy for the three months ended March 31, 2019 and 2018 are as follows:
 
Amounts reclassified
from AOCI
 
Income Statement Location
 
2019
 
2018
 
 
 
(In Thousands)
 
 
Cash flow hedges net unrealized gain (loss)
 
 
 
 
 
   Power contracts

$51,615

 

($30,082
)
 
Competitive business operating revenues
   Interest rate swaps
(48
)
 
(122
)
 
Miscellaneous - net
Total realized gain (loss) on cash flow hedges
51,567

 
(30,204
)
 
 
 
(10,829
)
 
6,343

 
Income taxes
Total realized gain (loss) on cash flow hedges (net of tax)

$40,738

 

($23,861
)
 
 
 
 
 
 
 
 
Pension and other postretirement liabilities
 
 
 
 
 
   Amortization of prior-service credit

$5,326

 

$5,426

 
(a)
   Amortization of loss
(18,988
)
 
(24,952
)
 
(a)
   Settlement loss
(1,137
)
 
(1,616
)
 
(a)
Total amortization
(14,799
)
 
(21,142
)
 
 
 
3,249

 
4,568

 
Income taxes
Total amortization (net of tax)

($11,550
)
 

($16,574
)
 
 
 
 
 
 
 
 
Net unrealized investment gain (loss)
 
 
 
 
 
Realized gain (loss)

($259
)
 

$53,314

 
Interest and investment income
 
95

 
(19,620
)
 
Income taxes
Total realized investment gain (loss) (net of tax)

($164
)
 

$33,694

 
 
 
 
 
 
 
 
Total reclassifications for the period (net of tax)

$29,024

 

($6,741
)
 
 

(a)
These accumulated other comprehensive income (loss) components are included in the computation of net periodic pension and other postretirement cost.  See Note 6 to the financial statements herein for additional details.

 
 
 
 
 
 
 

Total reclassifications out of accumulated other comprehensive income (loss) (AOCI) into income for Entergy Louisiana for the three months ended March 31, 2019 and 2018 are as follows:
 
 
Amounts reclassified
from AOCI
 
Income Statement Location
 
 
2019
 
2018
 
 
 
 
(In Thousands)
 
 
Pension and other postretirement liabilities
 
 
 
 
 
 
   Amortization of prior-service credit
 

$1,838

 

$1,934

 
(a)
   Amortization of loss
 
(527
)
 
(1,257
)
 
(a)
Total amortization
 
1,311

 
677

 
 
 
 
(342
)
 
(176
)
 
Income taxes
Total amortization (net of tax)
 
969

 
501

 
 
 
 
 
 
 
 
 
Total reclassifications for the period (net of tax)
 

$969

 

$501

 
 


(a)
These accumulated other comprehensive income (loss) components are included in the computation of net periodic pension and other postretirement cost.  See Note 6 to the financial statements herein for additional details.