Open and Adjusted EBITDA Consistent with Expectations
HOUSTON, May 3 /PRNewswire-FirstCall/ -- Reliant Energy, Inc. reported
open EBITDA of $114 million for the first quarter of 2007, compared to $45
million for the first quarter of 2006. Improved retail contribution margin
was partially offset by lower wholesale open contribution margin. Adjusted
EBITDA, which includes the effect of historical and operational wholesale
hedges and gains on sales of emission allowances, was $81 million for the
first quarter of 2007, compared to $76 million for the first quarter of
2006. During the first quarter of 2007, the company reported free cash flow
used in continuing operations of $37 million, compared to $27 million for
the same period in 2006.
"This was a solid quarter for our retail and wholesale operations and
is consistent with our expectations," commented Joel Staff, chairman and
chief executive officer. "With our repositioning essentially complete, we
are looking forward to implementing our new strategic plan with a program
of disciplined growth and a continued focus on maximizing shareholder
value. I am confident that our incoming chief executive officer, Mark
Jacobs, working along side with Brian Landrum, incoming chief operating
officer, will lead Reliant to the next level."
On a GAAP basis, income from continuing operations before income taxes
was $412 million for the first quarter of 2007, compared to a loss from
continuing operations before income taxes of $81 million for the same
period of 2006. The GAAP numbers include net unrealized gains from energy
derivatives of $522 million for the first quarter of 2007 and $23 million
for the same period of 2006. Unrealized gains and losses reverse in the
period of delivery. First quarter 2007 results also include a $22 million
charge for a litigation settlement. First quarter 2006 results included
gains on sales of assets and emission allowances totaling $151 million.
Cash provided by continuing operations from operating activities was $35
million, compared to a $228 million use of cash in continuing operations
from operating activities for the first quarter of 2006.
OUTLOOK
Reliant Energy's outlook for open EBITDA is $1,033 million, $1,257
million and $1,177 million for the years ending December 31, 2007, 2008 and
2009, respectively. Adjusted EBITDA, which includes the impact of
historical and operational wholesale hedging activity is $911 million,
$1,184 million and $1,083 million for the same periods. The outlook for
free cash flow provided by continuing operations is $269 million, $433
million and $551 million for the years ending December 31, 2007, 2008 and
2009, respectively.
This outlook is based on forward commodity prices as of March 23, 2007,
and assumptions and estimates by Reliant Energy.
Open EBITDA
Outlook Reconciliation
($ millions) 2007E 2008E 2009E
Income from continuing operations
before income taxes $857 $490 $400
Unrealized (gains) losses on
energy derivatives (640) (3) 29
Western States and similar
settlements (22) --- ---
Depreciation and amortization 403 437 424
Interest expense, net 313 260 230
Adjusted EBITDA * $911 $1,184 $1,083
Historical and operational
wholesale hedges 122 73 94
Open EBITDA $1,033 $1,257 $1,177
Free Cash Flow from Continuing Operations
Outlook Reconciliation
($ millions) 2007E 2008E 2009E
Operating cash flow from continuing
operations * $830 $964 $877
Change in margin deposits (297) (89) (20)
Western States and similar
settlements payments 57 --- ---
Adjusted cash flow provided by
continuing operations $590 $875 $857
Capital expenditures (238) (308) (183)
Purchases of emission allowances (83) (134) (123)
Free cash flow provided by
continuing operations $269 $433 $551
* Outlook assumes no changes in working capital.
NON-GAAP FINANCIAL MEASURES
This press release and the attached financial tables include the
following non-GAAP financial measures:
Adjusted retail gross margin
Open energy gross margin
Open wholesale gross margin
Open gross margin
Retail contribution margin
Wholesale open contribution margin
Open contribution margin
EBITDA
Adjusted EBITDA
Open EBITDA
Adjusted cash flow provided by (used in) continuing operations
Free cash flow provided by (used in) continuing operations
Adjusted net debt
A reconciliation of these financial measures and the most directly
comparable GAAP measures is included above or in the attached financial
tables. Additional information regarding these measures, including a
discussion of their usefulness and purpose, is included in the Form 8-K
furnished along with this press release. Certain factors that could affect
GAAP financial measures are not accessible on a forward-looking basis, but
could be material to future reported earnings and cash flows.
WEBCAST OF EARNINGS CONFERENCE CALL
Reliant Energy has scheduled its first-quarter 2007 earnings conference
call for Thursday May 3, 2007, at 10 a.m. CT. Interested parties may listen
to a live audio broadcast of the conference call at http://www.reliant.com
in the investors section. A replay of the call can be accessed
approximately two hours after the completion of the call. A copy of the
presentation accompanying the call is also available at this Website
address.
Reliant Energy, Inc. (NYSE: RRI) based in Houston, Texas, provides
electricity and energy services to retail and wholesale customers in the
United States. In Texas, the company provides service to approximately 1.9
million retail electricity customers, including residential and small
business customers and commercial, industrial, governmental and
institutional customers. Reliant also serves commercial, industrial,
governmental and institutional customers in the PJM (Pennsylvania, New
Jersey and Maryland) market.
The company is one of the largest independent power producers in the
nation with approximately 16,000 megawatts of power generation capacity
across the United States. These strategically located generating assets
utilize natural gas, fuel oil and coal. For more information, visit
http://www.reliant.com.
This news release contains "forward-looking statements" within the
meaning of Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934, as amended.
Forward-looking statements are statements that contain projections,
estimates or assumptions about our revenues, income and other financial
items, and our plans and objectives for future operations or about our
future economic performance, transactions and dispositions and financings
related thereto. In many cases you can identify forward-looking statements
by terminology such as "anticipate," "estimate," "believe," "continue,"
"could," "intend," "may," "plan," "potential," "predict," "should," "will,"
"expect," "objective," "projection," "forecast," "goal," "guidance,"
"outlook," "effort," "target" and other similar words. However, the absence
of these words does not mean that the statements are not forward-looking.
Actual results may differ materially from those expressed or implied by
forward-looking statements as a result of many factors or events,
including, but not limited to, legislative and regulatory developments, the
outcome of pending lawsuits, governmental proceedings and investigations,
the effects of competition, financial market conditions, access to capital,
the timing and extent of changes in commodity prices and interest rates,
weather conditions, changes in our business plan and other factors we
discuss or reference to in the "Risk Factors" section of our most recent
Annual Report on Form 10-K filed with the Securities and Exchange
Commission.
Each forward-looking statement speaks only as of the date of the
particular statement and we undertake no obligation to update or revise any
forward-looking statement, whether as a result of new information, future
events or otherwise.
Reliant Energy, Inc. and Subsidiaries
Consolidated Statements of Operations
(Thousands of Dollars, except per share amounts)
(Unaudited)
Three Months Ended March 31,
2007 2006
Revenues:
Revenues (including $14,570 and
$149,506 unrealized gains on energy
derivatives) $2,362,601 $2,452,685
Expenses:
Purchased power, fuel and cost of gas
sold (including $507,659 and $(126,038)
unrealized gains (losses) on energy
derivatives) 1,443,491 2,250,049
Operation and maintenance 230,741 185,555
Selling and marketing 29,940 23,997
Bad debt expense 16,017 10,804
Total 1,720,189 2,470,405
Contribution Margin 642,412 (17,720)
Other general and administrative 41,640 35,939
Western states and similar settlements 22,000 -
Gains on sales of assets and emission
allowances, net - (151,476)
Depreciation and amortization 91,969 80,505
Total 155,609 (35,032)
Operating Income 486,803 17,312
Other Income (Expense):
Income of equity investment, net 1,160 326
Other, net 1,068 85
Income Before Interest and Taxes 489,031 17,723
Interest expense (87,070) (108,162)
Interest income 10,464 9,018
Income (Loss) from Continuing
Operations Before Income Taxes 412,425 (81,421)
Income tax expense 152,062 57,646
Income (Loss) from Continuing Operations 260,363 (139,067)
Income (loss) from discontinued operations (1,652) 4,980
Income (Loss) Before Cumulative
Effect of Accounting Change 258,711 (134,087)
Cumulative effect of accounting
change, net of tax - 968
Net Income (Loss) $258,711 $(133,119)
Basic Earnings (Loss) Per Share:
Income (loss) from continuing operations $0.77 $(0.46)
Income (loss) from discontinued operations (0.01) 0.02
Cumulative effect of accounting change,
net of tax - -
Net income (loss) $0.76 $(0.44)
Diluted Earnings (Loss) Per Share:
Income (loss) from continuing operations $0.75 $(0.46)
Income (loss) from discontinued operations (0.01) 0.02
Cumulative effect of accounting change,
net of tax - -
Net income (loss) $0.74 $(0.44)
Weighted Average Common Shares
Outstanding (in thousands):
- Basic 339,345 305,631
- Diluted 349,452 305,631
Reference is made to Reliant Energy, Inc.'s Annual Report
on Form 10-K for the year ended December 31, 2006.
Reliant Energy, Inc. and Subsidiaries
Results of Operations by Segment - As Reported
(Millions of Dollars)
(Unaudited)
Three Months Ended March 31,
2007 2006 Change
Retail Energy:
Revenues $1,701 $1,687 $14
Purchased power 909 1,694 (785)
Gross margin, including unrealized
gains/losses on energy derivatives (1) 792 (7) 799
Operation and maintenance 61 51 10
Selling and marketing 30 24 6
Bad debt expense 17 14 3
Contribution margin, including unrealized
gains/losses on energy derivatives
-- Retail Energy 684 (96) 780
Wholesale Energy:
Revenues 748 911 (163)
Purchased power, fuel and cost of gas sold 621 702 (81)
Gross margin, including unrealized
gains/losses on energy derivatives
and historical and operational
wholesale hedges (1) 127 209 (82)
Operation and maintenance 170 134 36
Bad debt expense (1) (3) 2
Contribution margin, including
unrealized gains/losses on energy
derivatives and historical and
operational wholesale hedges
-- Wholesale Energy (42) 78 (120)
Other Operations:
Revenues 3 1 2
Purchased power, fuel and cost of gas sold - - -
Gross margin (1) 3 1 2
Operation and maintenance 1 - 1
Contribution margin - Other Operations 2 1 1
Eliminations:
Revenues (90) (146) 56
Purchased power, fuel and cost of gas sold (87) (146) 59
Gross margin (1) (3) - (3)
Operation and maintenance (1) - (1)
Contribution margin (2) - (2)
Consolidated:
Revenues 2,362 2,453 (91)
Purchased power, fuel and cost of gas sold 1,443 2,250 (807)
Gross margin, including unrealized
gains/losses on energy derivatives (1) 919 203 716
Operation and maintenance 231 185 46
Selling and marketing 30 24 6
Bad debt expense 16 11 5
Contribution margin, including unrealized
gains/losses on energy derivatives
-- Consolidated 642 (17) 659
Other general and administrative 41 35 6
Western states and similar settlements 22 - 22
Gains on sales of assets and emission
allowances, net - (151) 151
Depreciation and amortization 92 81 11
Total 155 (35) 190
Operating income 487 18 469
Income of equity investment, net 1 - 1
Other, net 1 - 1
Income before interest and income taxes 489 18 471
Interest expense (87) (108) 21
Interest income 10 9 1
Income (loss) from continuing operations
before income taxes 412 (81) 493
Income tax expense 152 58 94
Income (loss) from continuing operations 260 (139) 399
Income (loss) from discontinued
operations (1) 5 (6)
Cumulative effect of accounting change,
net of tax - 1 (1)
Net income (loss) $259 $(133) $392
(1) Gross margin (revenues less purchased power, fuel and cost of gas
sold) excludes depreciation, amortization, labor and other product
costs.
Reference is made to Reliant Energy, Inc.'s Annual Report
on Form 10-K for the year ended December 31, 2006.
Reliant Energy, Inc. and Subsidiaries
Results of Operations by Segment - Adjusted and Open
(Millions of Dollars)
(Unaudited)
Three Months Ended March 31,
2007 2006 Change
Retail Energy:
Gross margin, including unrealized
gains/losses on energy derivatives (1) $792 $(7) $799
Unrealized (gains) losses on energy
derivatives (616) 64 (680)
Adjusted gross margin -- Retail Energy 176 57 119
Operation and maintenance 61 51 10
Selling and marketing 30 24 6
Bad debt expense 17 14 3
Contribution margin -- Retail Energy 68 (32) 100
Wholesale Energy:
Gross margin, including unrealized
gains/losses on energy derivatives
and historical and operational
wholesale hedges (1) 127 209 (82)
Unrealized (gains) losses on energy
derivatives 94 (87) 181
Historical and operational wholesale hedges 33 120 (87)
Open gross margin -- Wholesale Energy 254 242 12
Operation and maintenance 170 134 36
Bad debt expense (1) (3) 2
Open contribution margin -- Wholesale
Energy 85 111 (26)
Other Operations:
Gross margin (1) 3 1 2
Operation and maintenance 1 - 1
Contribution margin -- Other Operations 2 1 1
Eliminations:
Gross margin (1) (3) - (3)
Operation and maintenance (1) - (1)
Contribution margin (2) - (2)
Consolidated:
Adjusted gross margin -- Retail Energy 176 57 119
Open gross margin -- Wholesale Energy 254 242 12
Gross margin -- Other Operations 3 1 2
Gross margin -- Eliminations (3) - (3)
Open gross margin - Consolidated 430 300 130
Operation and maintenance 231 185 46
Selling and marketing 30 24 6
Bad debt expense 16 11 5
Open contribution margin -- Consolidated 153 80 73
Other general and administrative (41) (35) (6)
Income of equity investment, net 1 - 1
Other, net 1 - 1
Open EBITDA 114 (2) 45 69
Historical and operational wholesale
hedges (33) (120) 87
Gains on sales of assets and emission
allowances, net - 151 (151)
Adjusted EBITDA 81 76 5
Unrealized gains on energy derivatives 522 23 499
Western states and similar settlements (22) - (22)
EBITDA 581 99 482
Depreciation and amortization (92) (81) (11)
Interest expense (87) (108) 21
Interest income 10 9 1
Income (loss) from continuing operations
before income taxes $412 $(81) $493
(1) Gross margin (revenues less purchased power, fuel and cost of gas
sold) excludes depreciation, amortization, labor and other product
costs.
(2) Open EBITDA excludes $22 million for the Western states and similar
settlements for the three months ended March 31, 2007.
Reference is made to Reliant Energy, Inc.'s Annual Report
on Form 10-K for the year ended December 31, 2006.
Reliant Energy, Inc. and Subsidiaries
Consolidated Balance Sheets
(Thousands of Dollars)
March 31, 2007 December 31, 2006
ASSETS (Unaudited)
Current Assets:
Cash and cash equivalents $488,046 $463,909
Restricted cash 10,838 24,980
Accounts and notes receivable,
principally customer, net of
allowance of $26,742 and $33,332 1,020,345 1,043,637
Inventory 243,043 275,437
Derivative assets 282,841 489,726
Margin deposits 349,736 452,605
Accumulated deferred income taxes 132,479 279,479
Prepayments and other current assets 145,756 141,016
Current assets of discontinued
operations 2,567 2,460
Total current assets 2,675,651 3,173,249
Property, plant and equipment, gross 7,216,151 7,192,437
Accumulated depreciation (1,509,961) (1,450,442)
Property, Plant and Equipment, net 5,706,190 5,741,995
Other Assets:
Goodwill 379,644 381,594
Other intangibles, net 421,218 423,745
Derivative assets 232,456 203,857
Accumulated deferred income taxes 72,858 87,858
Prepaid lease 272,314 264,328
Other 286,996 290,507
Total other assets 1,665,486 1,651,889
Total Assets $10,047,327 $10,567,133
LIABILITIES AND EQUITY
Current Liabilities:
Current portion of long-term debt
and short-term borrowings $359,745 $355,264
Accounts payable, principally trade 659,900 664,630
Derivative liabilities 511,565 1,164,809
Margin deposits - 16,490
Other 424,025 488,764
Current liabilities of
discontinued operations 3,382 3,286
Total current liabilities 1,958,617 2,693,243
Other Liabilities:
Derivative liabilities 323,262 420,534
Other 310,858 324,145
Total other liabilities 634,120 744,679
Long-term Debt 3,173,751 3,177,691
Commitments and Contingencies
Temporary Equity Stock-based Compensation 2,140 1,647
Stockholders' Equity:
Preferred stock; par value $0.001
per share (125,000,000 shares
authorized; none outstanding) - -
Common stock; par value $0.001 per
share (2,000,000,000 shares authorized;
341,212,794 and 337,623,392 issued) 102 99
Additional paid-in capital 6,190,816 6,174,665
Retained deficit (1,741,922) (2,026,316)
Accumulated other comprehensive loss (170,297) (198,575)
Total stockholders' equity 4,278,699 3,949,873
Total Liabilities and Equity $10,047,327 $10,567,133
Reference is made to Reliant Energy, Inc.'s Annual Report
on Form 10-K for the year ended December 31, 2006.
Reliant Energy, Inc. and Subsidiaries
Consolidated Statements of Cash Flows
(Unaudited)
Three Months Ended March 31,
2007 2006
(in thousands)
Cash Flows from Operating Activities:
Net income (loss) $258,711 $(133,119)
(Income) loss from discontinued operations 1,652 (4,980)
Net income (loss) from continuing operations
and cumulative effect of accounting change 260,363 (138,099)
Adjustments to Reconcile Net Income (Loss)
to Net Cash Provided by (Used in)
Operating Activities:
Cumulative effect of accounting change - (968)
Depreciation and amortization 91,969 80,505
Deferred income taxes 147,422 55,238
Net changes in energy derivatives (508,770) (13,869)
Amortization of deferred financing costs 3,666 3,931
Gains on sales of assets and emission
allowance, net - (151,476)
Income of equity investment, net (1,160) -
Other, net 6,803 1,328
Changes in other assets and liabilities:
Accounts and notes receivable and unbilled
revenue, net 45,811 88,805
Inventory 22,263 26,291
Margin deposits, net 86,379 120,392
Net derivative assets and liabilities (19,944) (50,002)
Western states and similar settlements
payments (35,000) (155,102)
Accounts payable 24,385 (75,817)
Other current assets (4,741) (3,120)
Other assets (11,974) (20,653)
Taxes payable/receivable 4,790 134
Other current liabilities (82,471) (6,543)
Other liabilities 5,691 10,636
Net cash provided by (used in) continuing
operations from operating activities 35,482 (228,389)
Net cash provided by (used in) discontinued
operations from operating activities (1,664) 7,279
Net cash provided by (used in) operating
activities 33,818 (221,110)
Cash Flows from Investing Activities:
Capital expenditures (42,167) (21,897)
Proceeds from sales of assets, net - 1,238
Proceeds from sales of emission allowances 1 187,910
Purchases of emission allowances (990) -
Restricted cash 14,142 (33,739)
Other, net - 2,500
Net cash provided by (used in) continuing
operations from investing activities (29,014) 136,012
Net cash provided by discontinued
operations from investing activities - 967,743
Net cash provided by (used in) investing
activities (29,014) 1,103,755
Cash Flows from Financing Activities:
Payments of long-term debt (3,466) (321,372)
Increase in short-term borrowings
and revolving credit facilities, net 6,554 27,241
Payments of financing costs (440) -
Proceeds from issuances of stock 16,685 5,016
Net cash provided by (used in) continuing
operations from financing activities 19,333 (289,115)
Net cash used in discontinued operations
from financing activities - (638,000)
Net cash provided by (used in) financing
activities 19,333 (927,115)
Net Change in Cash and Cash Equivalents 24,137 (44,470)
Cash and Cash Equivalents at Beginning
of Period 463,909 88,397
Cash and Cash Equivalents at End of
Period $488,046 $43,927
Free Cash Flow Reconciliation
(Unaudited)
Three Months Ended March 31,
2007 2006
(in millions)
Operating cash flow from continuing
operations $35 $(228)
Western states and similar settlements
payments 57 155
Change in margin deposits, net (86) (120)
Adjusted cash flow provided by (used in)
continuing operations 6 (193)
Capital expenditures (42) (22)
Proceeds from sales of emission
allowances - 188
Purchases of emission allowances (1) -
Free cash flow used in continuing
operations $(37) $(27)
Reference is made to Reliant Energy, Inc.'s Annual Report
on Form 10-K for the year ended December 31, 2006.
Reliant Energy, Inc. and Subsidiaries
Retail Energy Data
(Unaudited)
Three Months Ended March 31,
2007 2006 Change
(in millions)
Mass gross margin $160 $30 $130
Commercial and industrial gross margin 20 20 -
Market usage adjustments (4) 7 (11)
Adjusted retail gross margin 176 57 119
Operation and maintenance 61 51 10
Selling and marketing 30 24 6
Bad debt expense 17 14 3
Retail contribution margin 68 (32) 100
Unrealized gains (losses) on energy
derivatives 616 (64) 680
Total retail energy contribution margin,
including unrealized gains/losses on
energy derivatives $684 $(96) $780
Three Months Ended March 31,
2007 2006 Change
(in millions)
Adjusted retail gross margin $176 $57 $119
Unrealized gains (losses) on energy
derivatives 616 (64) 680
Total retail energy gross margin,
including unrealized gains/losses on
energy derivatives $792 $(7) $799
Three Months Ended March 31,
2007 2006
(gigawatt hours)
Electricity Sales to End-Use Retail Customers:
Mass:
Residential:
Houston 2,690 2,913
Non-Houston 1,952 1,547
Small Business:
Houston 725 697
Non-Houston 333 296
Total Mass 5,700 5,453
Commercial and Industrial:
ERCOT (1) 7,857 7,496
Non-ERCOT 1,006 1,588
Total Commercial and Industrial 8,863 9,084
Market usage adjustments (86) 7
Total 14,477 14,544
Three Months Ended March 31,
2007 2006
(in thousands, metered locations)
Weighted Average Retail Customer Count:
Mass:
Residential:
Houston 1,083 1,212
Non-Houston 555 472
Small Business:
Houston 121 136
Non-Houston 33 28
Total Mass 1,792 1,848
Commercial and Industrial:
ERCOT (1) 83 72
Non-ERCOT 1 2
Total Commercial and Industrial 84 74
Total 1,876 1,922
March 31, December 31,
2007 2006
(in thousands, metered locations)
Retail Customers:
Mass:
Residential:
Houston 1,074 1,095
Non-Houston 566 547
Small Business:
Houston 118 124
Non-Houston 34 33
Total Mass 1,792 1,799
Commercial and Industrial:
ERCOT (1) 85 75
Non-ERCOT 2 1
Total Commercial and Industrial 87 76
Total 1,879 1,875
(1) Includes customers of the Texas General Land Office for whom we
provide services.
Reference is made to Reliant Energy, Inc.'s Annual Report
on Form 10-K for the year ended December 31, 2006.
Reliant Energy, Inc. and Subsidiaries
Wholesale Energy Data
(Unaudited)
Three Months Ended March 31,
2007 2006
GWh %Economic(1) GWh %Economic(1)
Economic Generation Volume (2):
PJM Coal 6,098.5 84% 5,844.9 81%
MISO Coal 2,181.5 81% 1,292.0 47%
PJM/MISO Gas 67.3 1% 38.2 0%
West 8.8 0% 924.9 13%
Other 1,337.0 65% 1,407.1 86%
Total 9,693.1 37% 9,507.1 36%
Commercial Capacity Factor (3):
PJM Coal 79.2% 86.1%
MISO Coal 61.3% 94.9%
PJM/MISO Gas 60.2% 15.7%
West 100.0% 99.9%
Other 90.8% 83.2%
Total 76.7% 87.9%
Generation Volume (4): GWh GWh
PJM Coal 4,832.3 5,030.6
MISO Coal 1,336.3 1,225.9
PJM/MISO Gas 40.5 6.0
West 8.8 924.0
Other 1,214.2 1,170.1
Total 7,432.1 8,356.6
Unit Margin ($/MWh) (5):
PJM Coal $30.83 $27.63
MISO Coal 27.69 23.66
PJM/MISO Gas 24.69 -
West NM (6) 1.08
Other 5.77 NM (6)
Weighted Average Total $25.56 $20.10
Three Months Ended March 31,
2007 2006 Change
Open energy gross margin (7): (in millions)
PJM Coal $149 $139 $10
MISO Coal 37 29 8
PJM/MISO Gas 1 - 1
West (4) 1 (5)
Other 7 (1) 8
Total 190 168 22
Other margin (8):
PJM Coal 7 9 (2)
MISO Coal 2 1 1
PJM/MISO Gas 11 3 8
West 23 37 (14)
Other 21 24 (3)
Total 64 74 (10)
Open wholesale gross margin 254 242 12
Operation and maintenance (170) (134) (36)
Bad debt expense 1 3 (2)
Wholesale open contribution
margin 85 111 (26)
Historical and operational
wholesale hedges
Power (56) (115) 59
Fuel 5 7 (2)
Tolling/Other 18 (12) 30
Total historical and operational
wholesale hedges (33) (120) 87
Unrealized gains (losses) on
energy derivatives (94) 87 (181)
Total wholesale energy contribution
margin, including unrealized
gains/losses on energy derivatives
and historical and operational
wholesale hedges $(42) $78 $(120)
Open wholesale gross margin $254 $242 $12
Historical and operational
wholesale hedges (33) (120) 87
Unrealized gains (losses) on
energy derivatives (94) 87 (181)
Total wholesale energy gross
margin, including unrealized
gains/losses on energy
derivatives and historical
and operational wholesale hedges $127 $209 $(82)
(1) Represents economic generation volume (hours) divided by maximum
generation hours (maximum plant capacity X 8,760 hours).
(2) Estimated generation at 100% plant availability based on an
hourly analysis of when it is economical to generate based on the
price of power, fuel, emission allowances and variable operating
costs.
(3) Generation volume divided by economic generation volume.
(4) Excludes generation volume related to power purchase agreements,
including tolling agreements.
(5) Represents open energy gross margin divided by generation volume.
(6) NM is not meaningful.
(7) Open energy gross margin is calculated using the power sales
prices received by the plants less delivered spot fuel prices.
This figure excludes the effects of other margin and our
historical and operational wholesale hedges.
(8) Other margin represents power purchase agreements, capacity
payments, ancillary revenues and selective commercial hedge
strategies.
Reference is made to Reliant Energy, Inc.'s Annual Report
on Form 10-K for the year ended December 31, 2006.
Reliant Energy, Inc. and Subsidiaries
PJM Coal and MISO Coal (1)
(Unaudited)
Summer/Winter
Average
Capacity Heat Rate Q1 economic volume (GWh)
(MW) (MMBtu/MWh) 2007 2006
Unit Name
Cheswick 580 10.0 918.1 831.1
Conemaugh (2) 280 9.4 595.8 602.8
Elrama 465 11.3 847.5 840.5
Keystone (2) 282 9.5 586.8 567.6
Portland 400 10.1 679.7 616.4
Seward 521 9.7 1,066.1 1,109.2
Shawville (2) 566 10.3 1,044.9 965.1
Titus 246 10.8 359.6 312.2
PJM Coal Total 3,340 6,098.5 5,844.9
Summer/Winter
Average
Capacity Heat Rate Q1 economic volume (GWh)
(MW) (MMBtu/MWh) 2007 2006
Avon Lake 721 9.8 1,304.6 803.0
New Castle 328 10.7 507.7 237.1
Niles 216 10.5 369.2 251.9
MISO Coal Total 1,265 2,181.5 1,292.0
Q1 commercial capacity factor Q1 generation volume (GWh)
2007 2006 2007 2006
Cheswick 92.2% 99.5% 846.3 826.6
Conemaugh (2) 92.5% 95.6% 550.9 576.2
Elrama 72.0% 79.0% 609.8 664.0
Keystone (2) 67.5% 79.2% 395.8 449.5
Portland 79.4% 94.2% 539.8 580.8
Seward 53.5% 71.3% 570.8 790.7
Shawville (2) 94.5% 88.7% 987.7 856.2
Titus 92.1% 91.8% 331.2 286.6
PJM Coal Total 79.2% 86.1% 4,832.3 5,030.6
Q1 commercial capacity factor Q1 generation volume (GWh)
2007 2006 2007 2006
Avon Lake 47.5% 95.2% 619.7 764.1
New Castle 77.8% 93.3% 394.9 221.3
Niles 87.1% 95.5% 321.7 240.5
MISO Coal Total 61.3% 94.9% 1,336.3 1,225.9
(1) Unless otherwise indicated, the Company owns a 100% interest in
each facility listed.
(2) The Company leases a 100% interest in the Shawville facility, a
16.67% interest in the Keystone facility and a 16.45% interest in the
Conemaugh facility under facility interest lease agreements, which
expire in 2026, 2034 and 2034, respectively.
Reference is made to Reliant Energy, Inc.'s Annual Report
on Form 10-K for the year ended December 31, 2006.
Reliant Energy, Inc. and Subsidiaries
PJM/MISO Gas (1)
(Unaudited)
Summer/Winter
Average
Capacity Heat Rate Q1 economic generation volume (GWh)
(MW) (MMBtu/MWh) 2007 2006
Unit Name
Aurora (2) 942 10.5 3.7 3.2
Blossburg 23 14.6 3.3 1.0
Brunot Island 315 10.4 0.8 -
Gilbert 614 11.0 8.2 28.9
Glen Gardner 184 14.6 0.2 0.2
Hamilton 23 14.8 - -
Hunterstown 70 14.8 - 0.1
Hunterstown CCGT 833 7.0 44.2 -
Mountain 47 14.3 1.2 0.6
Orrtanna 23 14.4 0.4 -
Portland 185 11.2 3.2 0.2
Sayreville 264 13.8 0.7 0.4
Shawnee 23 14.0 0.1 -
Shawville 5-7 (3) 6 10.2 - -
Titus 35 17.4 - -
Tolna 47 14.2 0.8 0.1
Werner 252 13.8 0.5 -
Shelby 356 9.8 - 3.5
PJM/MISO Gas Total 4,242 67.3 38.2
Q1 commercial capacity factor Q1 generation volume (GWh)
2007 2006 2007 2006
Aurora (2) 0.0% 0.0% - -
Blossburg 100.0% 100.0% 3.3 1.0
Brunot Island 100.0% 0.0% 0.8 -
Gilbert 65.9% 13.8% 5.4 4.0
Glen Gardner 100.0% 100.0% 0.2 0.2
Hamilton 0.0% 0.0% - -
Hunterstown 0.0% 100.0% - 0.1
Hunterstown CCGT 55.7% 0.0% 24.6 -
Mountain 100.0% 100.0% 1.2 0.6
Orrtanna 100.0% 0.0% 0.4 -
Portland 100.0% 0.0% 3.2 -
Sayreville 0.0% 0.0% - -
Shawnee 100.0% 0.0% 0.1 -
Shawville 5-7 (3) 0.0% 0.0% - -
Titus 0.0% 0.0% - -
Tolna 100.0% 100.0% 0.8 0.1
Werner 100.0% 0.0% 0.5 -
Shelby 0.0% 0.0% - -
PJM/MISO Gas Total 60.2% 15.7% 40.5 6.0
(1) Unless otherwise indicated, the Company owns a 100% interest in each
facility listed.
(2) Excludes generation volume during periods the unit operated under
power purchase agreements.
(3) The Company leases a 100% interest in the Shawville facility under
facility interest lease agreement, which expires in 2026.
Reference is made to Reliant Energy, Inc.'s Annual Report
on Form 10-K for the year ended December 31, 2006.
Summer/Winter
Average
Capacity Heat Rate Q1 economic generation volume (GWh)
(MW) (MMBtu/MWh) 2007 2006
Unit Name
Bighorn (2) 598 7.2 - 918.7
Coolwater 622 10.1 - -
Ellwood (2) 54 13.3 0.3 0.1
Etiwanda (2) 640 10.0 - -
Mandalay (2) 560 10.9 8.5 6.1
Ormond Beach 1,516 9.6 - -
West Total 3,990 8.8 924.9
Summer/Winter
Average
Capacity Heat Rate Q1 economic generation volume (GWh)
(MW) (MMBtu/MWh) 2007 2006
Unit Name
Channelview 830 6.1 1,336.9 1,403.3
Indian River (2) 587 10.5 0.1 -
Osceola 470 11.0 - 3.8
Other Total 1,887 1,337.0 1,407.1
Q1 commercial capacity factor Q1 generation volume (GWh)
2007 2006 2007 2006
Unit Name
Bighorn (2) 0.0% 99.9% - 917.8
Coolwater 0.0% 0.0% - -
Ellwood (2) 100.0% 0.0% 0.3 0.1
Etiwanda (2) 0.0% 0.0% - -
Mandalay (2) 100.0% 100.0% 8.5 6.1
Ormond Beach 0.0% 0.0% - -
West Total 100.0% 99.9% 8.8 924.0
Q1 commercial capacity factor Q1 generation volume (GWh)
2007 2006 2007 2006
Unit Name
Channelview 90.8% 83.1% 1,214.1 1,166.3
Indian River (2) 100.0% 0.0% 0.1 -
Osceola 0.0% 100.0% - 3.8
Other Total 90.8% 83.2% 1,214.2 1,170.1
(1) Unless otherwise indicated, the Company owns a 100% interest in each
facility listed.
(2) Excludes generation volume during periods the unit operated under
power purchase agreements.
Reference is made to Reliant Energy, Inc.'s Annual Report
on Form 10-K for the year ended December 31, 2006.
Reliant Energy, Inc. and Subsidiaries
Adjusted Net Debt
(Unaudited)
(in millions)
March 31, 2007
Debt:
Senior secured revolver $-
Senior secured term loans 400
Senior secured notes 1,850
Convertible senior subordinated notes 2
Orion Power 12% notes (1) 436
PEDFA fixed-rate bonds for Seward plant due 2036 500
Channelview 345
Retail working capital facility -
Warrants (1)
Other (2) 1
Total debt 3,533
REMA operating leases (off-balance sheet) 480
Total debt and debt equivalents (3) 4,013
Less:
Cash and cash equivalents (488)
Restricted cash (11)
Net margin deposits (350)
Adjusted Net Debt $3,164
(1) Orion 12% notes include purchase accounting adjustments of $36
million.
(2) Other subsidiary debt.
(3) Debt equivalents include off-balance sheet REMA leases of $480
million.
Reference is made to Reliant Energy, Inc.'s Annual Report
on Form 10-K for the year ended December 31, 2006.
SOURCE Reliant Energy, Inc.
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Related links:
http://www.reliant.com
CONTACT:
Investors, Dennis Barber, +1-713-497-3042, or
Media, Pat Hammond, +1-713-497-7723, both of Reliant Energy, Inc.
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