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Entergy Corp. gives earnings guidance for second quarter

NEW ORLEANS — Entergy Corporation expects second quarter 2013 as-reported earnings of approximately $0.91 per share and operational earnings of approximately $1.00 per share.

Results for second quarter 2012 were $2.06 per share on an as-reported basis and $2.11 per share on an operational basis.

Entergy also affirmed previously issued operational earnings guidance for 2013.

Special items were recorded for expenses associated with the implementation of the human capital management strategic imperative in second quarter 2013 and expenses associated with the proposed spin-off and merger of Entergy’s electric transmission business with ITC Holdings Corp. in the second quarters of 2012 and 2013.

The decrease in Utility second quarter 2013 operational earnings was due primarily to substantially higher income tax expense than the prior year, according to the New Orleans-based utility. The prior year period reflected the effect of an agreement reached with the Internal Revenue Service regarding storm cost financings in Louisiana, significantly reducing second quarter 2012 income tax expense. Also contributing to lower results were higher non-fuel operation and maintenance expense and higher depreciation expense.

Higher Utility net revenue provided a partial offset to these items. Second quarter 2012 net revenue reflected a regulatory charge for customer sharing of the benefits of the IRS agreement noted above. Pricing adjustments due to nuclear and combined cycle natural gas-fired-generation investments placed in service in 2012 also contributed to the net revenue increase. Partially offsetting was lower sales volume, including the effects of weather. Weather was below normal in second quarter 2013 compared to the warmer-than-normal temperatures experienced one year ago.

The quarter-over-quarter decrease in operational earnings at Entergy Wholesale Commodities was due primarily to lower net revenue and higher decommissioning expense, partially offset by lower income taxes. A decommissioning liability adjustment reduced decommissioning expense in second quarter 2012 due primarily to an updated decommissioning cost study.

The decrease in EWC net revenue was driven by lower volume and energy prices on EWC’s nuclear fleet. Nuclear production declined due to more unplanned and refueling outages. Refueling days at Pilgrim Nuclear Power Station and Vermont Yankee Nuclear Power Station totaled 50 days in second quarter 2013, versus 35 days at two other plants for the same quarter last year.

In the Parent & Other disclosure segment, results declined during the quarter due to an increase in income tax expense on Parent & Other activities. Second quarter 2012 benefited from a favorable federal appeals court decision affirming Entergy’s entitlement to claim foreign tax credits for the U.K. Windfall Tax.

Entergy affirmed its previously issued 2013 operational earnings guidance to be in the range of $4.60 to $5.40 per share.


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