Document
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 8-K
CURRENT REPORT

Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934

Date of Report (Date earliest event reported) July 29, 2020


Commission
File Number
Registrant, State of Incorporation or Organization, Address of Principal Executive Offices, Telephone Number, and IRS Employer Identification No.
 

Commission
File Number
Registrant, State of Incorporation or Organization, Address of Principal Executive Offices, Telephone Number, and IRS Employer Identification No.
 
 
 
 
 
1-11299
ENTERGY CORPORATION
 
1-35747
ENTERGY NEW ORLEANS, LLC
 
(a Delaware corporation)
639 Loyola Avenue
New Orleans, Louisiana 70113
Telephone (504) 576-4000
 
 
(a Texas limited liability company)
1600 Perdido Street
New Orleans, Louisiana 70112
Telephone (504) 670-3700
 
72-1229752
 
 
82-2212934
 
 
 
 
 
 
 
 
 
 
1-10764
ENTERGY ARKANSAS, LLC
 
1-34360
ENTERGY TEXAS, INC.
 
(a Texas limited liability company)
425 West Capitol Avenue
Little Rock, Arkansas 72201
Telephone (501) 377-4000
 
 
(a Texas corporation)
10055 Grogans Mill Road
The Woodlands, Texas 77380
Telephone (409) 981-2000
 
83-1918668
 
 
61-1435798
 
 
 
 
 
 
 
 
 
 
1-32718
ENTERGY LOUISIANA, LLC
 
1-09067
SYSTEM ENERGY RESOURCES, INC.
 
(a Texas limited liability company)
4809 Jefferson Highway
Jefferson, Louisiana 70121
Telephone (504) 576-4000
 
 
(an Arkansas corporation)
1340 Echelon Parkway
Jackson, Mississippi 39213
Telephone (601) 368-5000
 
47-4469646
 
 
72-0752777
 
 
 
 
 
 
 
 
 
 
1-31508
ENTERGY MISSISSIPPI, LLC
 
 
 
 
(a Texas limited liability company)
308 East Pearl Street
Jackson, Mississippi 39201
Telephone (601) 368-5000
 
 
 
 
83-1950019
 
 
 
 
 
 
 
 
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2.):
    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))





Securities registered pursuant to Section 12(b) of the Act:

Registrant
Title of Class
Trading
Symbol
Name of Each Exchange
on Which Registered
 
 
 
 
Entergy Corporation
Common Stock, $0.01 Par Value
ETR
New York Stock Exchange
 
Common Stock, $0.01 Par Value
ETR
NYSE Chicago, Inc.
 
 
 
 
Entergy Arkansas, LLC
Mortgage Bonds, 4.90% Series due December 2052
EAB
New York Stock Exchange
 
Mortgage Bonds, 4.75% Series due June 2063
EAE
New York Stock Exchange
 
Mortgage Bonds, 4.875% Series due September 2066
EAI
New York Stock Exchange
 
 
 
 
Entergy Louisiana, LLC
Mortgage Bonds, 5.25% Series due July 2052
ELJ
New York Stock Exchange
 
Mortgage Bonds, 4.70% Series due June 2063
ELU
New York Stock Exchange
 
Mortgage Bonds, 4.875% Series due September 2066
ELC
New York Stock Exchange
 
 
 
 
Entergy Mississippi, LLC
Mortgage Bonds, 4.90% Series due October 2066
EMP
New York Stock Exchange
 
 
 
 
Entergy New Orleans, LLC
Mortgage Bonds, 5.0% Series due December 2052
ENJ
New York Stock Exchange
 
Mortgage Bonds, 5.50% Series due April 2066
ENO
New York Stock Exchange
 
 
 
 
Entergy Texas, Inc.
Mortgage Bonds, 5.625% Series due June 2064
EZT
New York Stock Exchange
 
5.375% Series A Preferred Stock, Cumulative, No Par Value (Liquidation Value $25 Per Share)
ETI/PR
New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2).
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.     






Item 2.02. Results of Operations and Financial Condition

On July 29, 2020, Entergy Corporation (the “Company”) issued a press release, which is attached as Exhibit 99.1 hereto and incorporated herein by reference, announcing its results of operations and financial condition for the second quarter 2020 (the “Earnings Release”). The information in Exhibit 99.1 is being furnished, not filed, pursuant to this Item 2.02.

Item 7.01. Regulation FD Disclosure

On July 29, 2020, the Company issued the Earnings Release, which is attached as Exhibit 99.1 hereto and incorporated herein by reference, announcing its results of operations and financial condition for the second quarter 2020. The information in Exhibit 99.1 is being furnished, not filed, pursuant to this Item 7.01.

Item 9.01. Financial Statements and Exhibits

(d) Exhibits.
Exhibit No.
Description
99.1
 
 
104
Cover Page Interactive Data File - the cover page XBRL tags are embedded within the Inline XBRL document.






SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, each registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Entergy Corporation
Entergy Arkansas, LLC
Entergy Louisiana, LLC
Entergy Mississippi, LLC
Entergy New Orleans, LLC
Entergy Texas, Inc.
System Energy Resources, Inc.

By: /s/ Kimberly A. Fontan
Kimberly A. Fontan
Senior Vice President and
Chief Accounting Officer

Dated: July 29, 2020





Exhibit


https://cdn.kscope.io/7b1842e28cd42d1e3b53c1e1420c0ae1-entergylogoa93.gif
Exhibit 99.1

Entergy
639 Loyola Avenue
New Orleans, LA 70113




Date:
July 29, 2020
 
 
 
 
 
 
For Release:
Immediately
 
 
 
 
 
 
Contact:
Neal Kirby (Media)
(504) 576-4238
nkirby@entergy.com
David Borde (Investor Relations)
(504) 576-5668
dborde@entergy.com

Entergy Reports Second Quarter Earnings
Company affirms guidance and financial outlooks

NEW ORLEANS - Entergy Corporation (NYSE: ETR) reported second quarter 2020 earnings of $1.79 per share on an as-reported basis and $1.37 per share on an adjusted basis (non-GAAP).

“We delivered another strong quarter and remain on track to achieve our full-year objectives. Sales were better than expected, we’re on pace to achieve our cost savings target for the year, and our capital plan is unchanged. With these results, we are affirming our full-year guidance, our longer-term outlooks, and our dividend growth aspirations,” said Entergy Chairman and Chief Executive Officer Leo Denault. “The COVID-19 pandemic has placed a burden on our customers, employees, and communities, and we continue to support our stakeholders as we all work to recover from its effects. The foundation of our business remains strong and sustainable. We are committed to our strategic, operational, and financial objectives and our resolve to be the premier utility.”

Business highlights included the following:
Western Region Phase 2 economic transmission project was completed.
Table of Contents Page
News Release1
Appendices7
A: Consolidated Results and Adjustments8
B: Earnings Variance Analysis11
C: Utility Financial and Operating Measures13
D: EWC Financial and Operating Measures14
E: Consolidated Financial Measures15
F: Definitions and Abbreviations and Acronyms16
G: Other GAAP to Non-GAAP Reconciliations19
Financial Statements22





The New Orleans Power Station was placed in service.
E-LA issued an RFP for up to 300 megawatts of new renewable resources.
The MPSC approved E-MS’s annual FRP filing.
E-LA and E-AR each submitted their annual FRP filings.
The PUCT finalized its generation rider rulemaking.
In 2019, Entergy provided power to customers at the second-lowest average price in the U.S., according to an S&P Global Market Intelligence study.
For the fifth consecutive year, Entergy was named to The Civic 50, a Points of Light initiative honoring the 50 most community-minded companies in the U.S.

Consolidated Earnings (GAAP and Non-GAAP Measures)
Second Quarter and Year-to-Date 2020 vs. 2019 (See Appendix A for reconciliation of GAAP to non-GAAP measures and description of adjustments)
 
Second Quarter
Year-to-Date
 
2020
2019
Change
2020
2019
Change
(After-tax, $ in millions)
 
 
 
 
 
 
As-reported earnings
361
236
124
479
491
(12)
Less adjustments
85
(26)
111
(26)
71
(97)
Adjusted earnings (non-GAAP)
276
262
14
506
420
85
  Estimated weather in billed sales
(4)
12
(16)
(54)
(12)
(42)
 
 
 
 
 
 
 
(After-tax, per share in $)
 
 
 
 
 
 
As-reported earnings
1.79
1.22
0.57
2.39
2.54
(0.15)
Less adjustments
0.42
(0.13)
0.55
(0.13)
0.36
(0.49)
Adjusted earnings (non-GAAP)
1.37
1.35
0.02
2.52
2.18
0.34
  Estimated weather in billed sales
(0.02)
0.06
(0.08)
(0.27)
(0.06)
(0.21)
 
 
 
 
 
 
 
Calculations may differ due to rounding

Consolidated Results

For second quarter 2020, the company reported earnings of $361 million, or $1.79 per share, on an as-reported basis, and earnings of $276 million, or $1.37 per share, on an adjusted basis. This compared to second quarter 2019 earnings of $236 million, or $1.22 per share, on an as-reported basis, and earnings of $262 million, or $1.35 per share, on an adjusted basis.

Summary discussions by business are below. Additional details, including information on OCF by business, are provided in Appendix A. An analysis of quarterly and year-to-date variances by business is provided in Appendix B.

Business Segment Results

Utility

For second quarter 2020, the Utility business reported earnings attributable to Entergy Corporation of $345 million, or $1.71 per share, on both an as-reported and an adjusted basis. This compared to second quarter 2019 earnings of $331 million, or $1.70 per share, on both an as-reported basis and an adjusted basis. Drivers for the quarter included:
regulatory actions at E-AR, E-LA, E-MS, and E-TX; and
lower non-nuclear generation expenses, including a delay in planned outages in 2020 as a result of the COVID-19 pandemic, as well as lower nuclear generation expenses.






These drivers were partially offset by:
lower sales volume, including the effects of weather; and
higher depreciation and interest expenses.

On a per share basis, second quarter 2020 results reflected higher common shares outstanding.

Appendix C contains additional details on Utility financial and operating measures.

Parent & Other

For second quarter 2020, Parent & Other reported a loss attributable to Entergy Corporation of $(69 million), or (34) cents per share, on both an as-reported basis and an adjusted basis. This compared to a loss of $(69 million), or (35) cents per share, on both an as-reported and an adjusted basis in second quarter 2019.

On a per share basis, second quarter 2020 results reflected higher common shares outstanding.
 
Entergy Wholesale Commodities

For second quarter 2020, EWC reported earnings attributable to Entergy Corporation of
$85 million, or 42 cents per share, on an as-reported basis. This compared to a second quarter 2019 loss of $(26 million), or (13) cents per share, on an as-reported basis. Drivers for the quarter included:
gains on decommissioning trust funds;
lower other O&M expense due to the shutdown of Pilgrim and Indian Point 2, as well as lower severance and retention expense; and
lower decommissioning and depreciation expenses.

These drivers were partially offset by lower revenue due to the shutdown of Pilgrim and Indian Point 2.

On a per share basis, second quarter 2020 results reflected higher common shares outstanding.

Appendix D contains additional details on EWC financial and operating measures, including a reconciliation for non-GAAP EWC adjusted EBITDA.


Earnings per Share Guidance

Entergy affirmed its 2020 adjusted EPS guidance range of $5.45 to $5.75. See webcast presentation slides for additional details.

The company has provided 2020 earnings guidance with regard to the non-GAAP measure of Entergy adjusted EPS. This measure excludes from the corresponding GAAP financial measure the effect of adjustments as described below under “Non-GAAP Financial Measures.” The company has not provided a reconciliation of such non-GAAP guidance to guidance presented on a GAAP basis because it cannot predict and quantify with a reasonable degree of confidence all of the adjustments that may occur during the period. One such adjustment will be the exclusion of EWC earnings from Entergy adjusted EPS. We currently estimate that the contribution of EWC to Entergy’s as-reported EPS will be approximately $(0.55) in 2020. These estimates are subject to





substantial uncertainty due to, among other things, the potential effects of exiting the EWC business.

Earnings Teleconference

A teleconference will be held at 10:00 a.m. Central Time on Wednesday, July 29, 2020, to discuss Entergy’s quarterly earnings announcement and the company’s financial performance. The teleconference may be accessed by visiting Entergy’s website at www.entergy.com or by dialing 844-309-6569, conference ID 5161259, no more than 15 minutes prior to the start of the call. The webcast slide presentation is also posted to Entergy’s website concurrent with this news release, which was issued before market open on the day of the call. A replay of the teleconference will be available on Entergy’s website at www.entergy.com and by telephone. The telephone replay will be available through August 5, 2020, by dialing 855-859-2056, conference ID 5161259.

Entergy Corporation is an integrated energy company engaged primarily in electric power production and retail distribution operations. Entergy owns and operates power plants with approximately 30,000 megawatts of electric generating capacity, including 8,000 megawatts of nuclear power. Entergy delivers electricity to 2.9 million utility customers in Arkansas, Louisiana, Mississippi, and Texas. Entergy has annual revenues of $11 billion and approximately 13,600 employees.
 
Entergy Corporation’s common stock is listed on the New York Stock Exchange and NYSE Chicago under the symbol “ETR.”

Details regarding Entergy’s results of operations, regulatory proceedings, and other matters are available in this earnings release, a copy of which will be filed with the SEC, and the webcast slide presentation. Both documents are available on Entergy’s Investor Relations website at www.entergy.com/investor_relations.

Entergy maintains a web page as part of its Investor Relations website, entitled Regulatory and Other Information, which provides investors with key updates of certain regulatory proceedings and important milestones on the execution of its strategy. While some of this information may be considered material information, investors should not rely exclusively on this page for all relevant company information.

For definitions of certain operating measures, as well as GAAP and non-GAAP financial measures and abbreviations and acronyms used in the earnings release materials, see Appendix F.

Non-GAAP Financial Measures
    
This news release contains non-GAAP financial measures, which are generally numerical measures of a company’s performance, financial position, or cash flows that either exclude or include amounts that are not normally excluded or included in the most directly comparable measure calculated and presented in accordance with GAAP. Entergy has provided quantitative reconciliations within this news release of the non-GAAP financial measures to the most directly comparable GAAP financial measures.

Entergy reports earnings using the non-GAAP measure of Entergy adjusted earnings, which excludes the effect of certain “adjustments,” including the removal of the Entergy Wholesale Commodities segment in light of the company’s decision to exit the merchant power business.





Adjustments are unusual or non-recurring items or events or other items or events that management believes do not reflect the ongoing business of Entergy, such as the results of the EWC segment, significant tax items, and other items such as certain costs, expenses, or other specified items. In addition to reporting GAAP consolidated earnings on a per share basis, Entergy reports its adjusted earnings on a per share basis. These per share measures represent the applicable earnings amount divided by the diluted average number of common shares outstanding for the period.

Management uses the non-GAAP financial measures of adjusted earnings and adjusted earnings per share for, among other things, financial planning and analysis; reporting financial results to the board of directors, employees, stockholders, analysts, and investors; and internal evaluation of financial performance. Entergy believes that these non-GAAP financial measures provide useful information to investors in evaluating the ongoing results of Entergy’s business, comparing period to period results, and comparing Entergy’s financial performance to the financial performance of other companies in the utility sector.

Other non-GAAP measures, including adjusted EBITDA; adjusted ROE; adjusted ROIC; gross liquidity; net liquidity; net liquidity, including storm escrows; debt to capital, excluding securitization debt; net debt to net capital, excluding securitization debt; parent debt to total debt, excluding securitization debt; FFO; FFO to debt, excluding securitization debt; and FFO to debt, excluding securitization debt, return of unprotected excess ADIT, and severance and retention payments associated with exit of EWC, are measures Entergy uses internally for management and board discussions and to gauge the overall strength of its business. Entergy believes the above data provides useful information to investors in evaluating Entergy’s ongoing financial results and flexibility, and assists investors in comparing Entergy’s credit and liquidity to the credit and liquidity of others in the Utility sector. In addition, other financial measures including net income (or earnings), adjusted for preferred dividends and tax-effected interest expense; ROIC; and ROE are included on both an adjusted and an as-reported basis. In each case, the metrics defined as “adjusted” (other than EWC’s adjusted EBITDA) excludes the effect of adjustments as defined above. EWC’s adjusted EBITDA represents EWC’s earnings before interest, taxes, and depreciation and amortization, and also excludes decommissioning expense.

These non-GAAP financial measures reflect an additional way of viewing aspects of Entergy’s operations that, when viewed with Entergy’s GAAP results and the accompanying reconciliations to corresponding GAAP financial measures, provide a more complete understanding of factors and trends affecting Entergy’s business. These non-GAAP financial measures should not be used to the exclusion of GAAP financial measures. Investors are strongly encouraged to review Entergy’s consolidated financial statements and publicly filed reports in their entirety and not to rely on any single financial measure. Although certain of these measures are intended to assist investors in comparing Entergy’s performance to other companies in the utility sector, non-GAAP financial measures are not standardized; therefore, it might not be possible to compare these financial measures with other companies’ non-GAAP financial measures having the same or similar names.

Cautionary Note Regarding Forward-Looking Statements

In this news release, and from time to time, Entergy Corporation makes certain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements include, among other things, Entergy’s 2020 earnings guidance; its current financial and operational outlooks; and other statements of Entergy’s plans, beliefs, or





expectations included in this news release. Readers are cautioned not to place undue reliance on these forward-looking statements, which apply only as of the date of this news release. Except to the extent required by the federal securities laws, Entergy undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise.
 
Forward-looking statements are subject to a number of risks, uncertainties and other factors that could cause actual results to differ materially from those expressed or implied in such forward-looking statements, including (a) those factors discussed elsewhere in this news release and in Entergy’s most recent Annual Report on Form 10-K, any subsequent Quarterly Reports on Form 10-Q, and Entergy’s other reports and filings made under the Securities Exchange Act of 1934; (b) uncertainties associated with (1) rate proceedings, formula rate plans, and other cost recovery mechanisms, including the risk that costs may not be recoverable to the extent anticipated by the utilities and (2) implementation of the ratemaking effects of changes in law; (c) uncertainties associated with efforts to remediate the effects of major storms and recover related restoration costs; (d) risks associated with operating nuclear facilities, including plant relicensing, operating, and regulatory costs and risks; (e) changes in decommissioning trust fund values or earnings or in the timing or cost of decommissioning Entergy’s nuclear plant sites;
(f) legislative and regulatory actions and risks and uncertainties associated with claims or litigation by or against Entergy and its subsidiaries; (g) risks and uncertainties associated with strategic transactions that Entergy or its subsidiaries may undertake, including the risk that any such transaction may not be completed as and when expected, and the risk that the anticipated benefits of the transaction may not be realized; (h) effects of changes in federal, state, or local laws and regulations and other governmental actions or policies, including changes in monetary, fiscal, tax, environmental, or energy policies; (i) the effects of technological changes and changes in commodity markets, capital markets, or economic conditions; (j) impacts from a terrorist attack, cybersecurity threats, data security breaches, or other attempts to disrupt Entergy’s business or operations, and/or other catastrophic events; and (k) the direct and indirect impacts of the COVID-19 pandemic on Entergy and its customers.







Second Quarter 2020 Earnings Release Appendices and Financial Statements

Appendices
A: Consolidated Results and Adjustments
B: Earnings Variance Analysis
C: Utility Financial and Operating Measures
D: EWC Financial and Operating Measures
E: Consolidated Financial Measures
F: Definitions and Abbreviations and Acronyms
G: Other GAAP to Non-GAAP Reconciliations

Financial Statements
Consolidating Balance Sheets
Consolidating Income Statements
Consolidated Cash Flow Statements






A: Consolidated Results and Adjustments
Appendix A-1 provides a comparative summary of consolidated earnings, including a reconciliation of as-reported earnings (GAAP) to adjusted earnings (non-GAAP).

Appendix A-1: Consolidated Earnings - Reconciliation of GAAP to Non-GAAP Measures
Second Quarter and Year-to-Date 2020 vs. 2019 (See Appendix A-3 and Appendix A-4 for details on adjustments)
 
Second Quarter
Year-to-Date
 
2020
2019
Change
2020
2019
Change
(After-tax, $ in millions)
 
 
 
 
 
 
As-reported earnings (loss)
 
 
 
 
 
 
Utility
345
331
14
665
562
103
Parent & Other
(69)
(69)
(159)
(141)
(18)
EWC
85
(26)
111
(26)
71
(97)
Consolidated
361
236
124
479
491
(12)
 
 
 
 
 
 
 
Less adjustments
 
 
 
 
 
 
Utility
Parent & Other
EWC
85
(26)
111
(26)
71
(97)
Consolidated
85
(26)
111
(26)
71
(97)
 
 
 
 
 
 
 
Adjusted earnings (loss) (non-GAAP)
 
 
 
 
 
 
Utility
345
331
14
665
562
103
Parent & Other
(69)
(69)
(159)
(141)
(18)
EWC
Consolidated
276
262
14
506
420
85
Estimated weather in billed sales
(4)
12
(16)
(54)
(12)
(42)
 
 
 
 
 
 
 
Diluted average number of common shares outstanding (in millions)
201
194
 
201
193
 
 
 
 
 
 
 
 
(After-tax, per share in $) (a)
 
 
 
 
 
 
As-reported earnings (loss)
 
 
 
 
 
 
Utility
1.71
1.70
0.01
3.31
2.91
0.40
Parent & Other
(0.34)
(0.35)
0.01
(0.79)
(0.73)
(0.06)
EWC
0.42
(0.13)
0.55
(0.13)
0.36
(0.49)
Consolidated
1.79
1.22
0.57
2.39
2.54
(0.15)
 
 
 
 
 
 
 
Less adjustments
 
 
 
 
 
 
Utility
Parent & Other
EWC
0.42
(0.13)
0.55
(0.13)
0.36
(0.49)
Consolidated
0.42
(0.13)
0.55
(0.13)
0.36
(0.49)
 
 
 
 
 
 
 
Adjusted earnings (loss) (non-GAAP)
 
 
 
 
 
 
Utility
1.71
1.70
0.01
3.31
2.91
0.40
Parent & Other
(0.34)
(0.35)
0.01
(0.79)
(0.73)
(0.06)
EWC
Consolidated
1.37
1.35
0.02
2.52
2.18
0.34
Estimated weather in billed sales
(0.02)
0.06
(0.08)
(0.27)
(0.06)
(0.21)
 
 
 
 
 
 
 
Calculations may differ due to rounding
(a)
Per share amounts are calculated by dividing the corresponding earnings (loss) by the diluted average number of common shares outstanding for the period.






See Appendix B for detailed earnings variance analysis.
Appendix A-2 provides a comparative summary of OCF, by business.

Appendix A-2: Consolidated Operating Cash Flow
Second Quarter and Year-to-Date 2020 vs. 2019
($ in millions)
 
Second Quarter
Year-to-Date
 
2020
2019
Change
2020
2019
Change
Utility
792
699
94
1,395
1,154
241
Parent & Other
(64)
(45)
(19)
(144)
(123)
(22)
EWC
60
(102)
163
198
22
176
Consolidated
789
552
237
1,448
1,053
395
 
 
 
 
 
 
 
Calculations may differ due to rounding

OCF increased quarter-over-quarter due primarily to higher collections for fuel and purchased power cost recovery and a lower amount of unprotected excess ADIT returned to customers. Lower nuclear refueling outage spending and lower severance and retention payments at EWC also contributed. Lower collections from customers partially offset the increase. Intercompany income tax payments contributed to the line of business variances.

Appendix A-3 and Appendix A-4 list adjustments by business. Adjustments are included in as-reported earnings consistent with GAAP but are excluded from adjusted earnings. As a result, adjusted earnings is considered a non-GAAP measure.

Appendix A-3: Adjustments by Driver (shown as positive/(negative) impact on earnings or EPS)
Second Quarter and Year-to-Date 2020 vs. 2019
 
Second Quarter
Year-to-Date
 
2020
2019
Change
2020
2019
Change
 
 
 
 
 
 
 
(Pre-tax except for income taxes, preferred dividend
requirements, and totals; $ in millions)
 
 
 
 
 
 
EWC
 
 
 
 
 
 
Income before income taxes
110
(35)
144
(31)
128
(160)
Income taxes
(24)
9
(34)
6
(57)
63
Preferred dividend requirements
(1)
(1)
(1)
(1)
Total EWC
85
(26)
111
(26)
71
(97)
 
 
 
 
 
 
 
Total adjustments
85
(26)
111
(26)
71
(97)
 
 
 
 
 
 
 
(After-tax, per share in $) (b)
 
 
 
 
 
 
EWC
 
 
 
 
 
 
Total EWC
0.42
(0.13)
0.55
(0.13)
0.36
(0.49)
 
 
 
 
 
 
 
Total adjustments
0.42
(0.13)
0.55
(0.13)
0.36
(0.49)
 
 
 
 
 
 
 
Calculations may differ due to rounding
(b)
Per share amounts are calculated by dividing the corresponding earnings (loss) by the diluted average number of common shares outstanding for the period.







Appendix A-4: Adjustments by Income Statement Line Item (shown as positive/(negative) impact on earnings)
Second Quarter and Year-to-Date 2020 vs. 2019
(Pre-tax except for income taxes, preferred dividend requirements, and totals; $ in millions)
 
Second Quarter
Year-to-Date
 
2020
2019
Change
2020
2019
Change
EWC
 
 
 
 
 
 
Operating revenues
200
290
(90)
532
723
(191)
Fuel and fuel-related expenses
(17)
(26)
9
(37)
(51)
14
Purchased power
(10)
(15)
5
(21)
(31)
10
Nuclear refueling outage expense
(12)
(12)
(24)
(24)
Other O&M
(140)
(188)
47
(271)
(376)
105
Asset write-off and impairments
(7)
(16)
10
(12)
(90)
79
Decommissioning expense
(51)
(64)
13
(102)
(128)
26
Taxes other than income taxes
(14)
(20)
6
(34)
(33)
(1)
Depreciation/amortization exp.
(25)
(38)
13
(60)
(76)
16
Other income (deductions)-other
194
64
130
10
232
(222)
Interest exp. and other charges
(7)
(9)
2
(12)
(18)
6
Income taxes
(24)
9
(34)
6
(57)
63
Preferred dividend requirements
(1)
(1)
(1)
(1)
Total EWC
85
(26)
111
(26)
71
(97)
 
 
 
 
 
 
 
Total adjustments
85
(26)
111
(26)
71
(97)
 
 
 
 
 
 
 
Calculations may differ due to rounding






B: Earnings Variance Analysis
Appendix B-1 and Appendix B-2 provide details of current quarter and year-to-date 2020 versus 2019 as-reported and adjusted earnings variance analysis for Utility, Parent & Other, and EWC.

Appendix B-1: As-Reported and Adjusted Earnings Variance Analysis (c), (d)
Second Quarter 2020 vs. 2019
(After-tax, per share in $)
 
Utility
 
Parent & Other
 
EWC
 
Consolidated
 
As-Reported
Adjusted
 
As-Reported
Adjusted
 
As-
Reported
 
As-
Reported
Adjusted
2019 earnings
1.70
1.70
 
(0.35)
(0.35)
 
(0.13)
 
1.22
1.35
Operating revenue less:
  Fuel, fuel-related expenses and
  gas purchased for resale,
  Purchased power, and
  Regulatory charges (credits)
0.14
0.14
(e)
 
(0.31)
(f)
(0.17)
0.14
Nuclear refueling outage expense
0.02
0.02
 
 
 
0.02
0.02
Other O&M
0.23
0.23
(g)
(0.01)
(0.01)
 
0.19
(h)
0.41
0.22
Asset write-offs and impairments
 
 
0.04
 
0.04
Decommissioning expense
(0.01)
(0.01)
 
 
0.05
(i)
0.04
(0.01)
Taxes other than income taxes
(0.01)
(0.01)
 
 
0.02
 
0.01
(0.01)
Depreciation/amortization exp.
(0.20)
(0.20)
(j)
 
0.05
(k)
(0.15)
(0.20)
Other income (deductions)-other
(0.02)
(0.02)
 
0.03
0.03
 
0.53
(l)
0.54
0.01
Interest exp. and other charges
(0.08)
(0.08)
(m)
(0.01)
(0.01)
 
0.01
 
(0.08)
(0.09)
Income taxes-other
 
(0.01)
(0.01)
 
(0.02)
 
(0.03)
(0.01)
Preferred dividend requirements
 
 
 
Share effect
(0.06)
(0.06)
 (n)
0.01
0.01
 
(0.01)
 
(0.06)
(0.05)
2020 earnings
1.71
1.71
 
(0.34)
(0.34)
 
0.42
 
1.79
1.37
 
 
 
 
 
 
 
 
 
 
 







Appendix B-2: As-Reported and Adjusted Earnings Variance Analysis (c), (d)
Year-to-date 2020 vs. 2019
(After-tax, per share in $)
 
Utility
 
Parent & Other
 
EWC
 
Consolidated
 
As-Reported
Adjusted
 
As-Reported
Adjusted
 
As-
Reported
 
As-
Reported
Adjusted
2019 earnings
2.91
2.91
 
(0.73)
(0.73)
 
0.36
 
2.54
2.18
Operating revenue less:
  Fuel, fuel-related expenses and
  gas purchased for resale,
  Purchased power, and
  Regulatory charges (credits)
0.41
0.41
(e)
 
(0.68)
(f)
(0.27)
0.41
Nuclear refueling outage expense
0.02
0.02
 
 
 
0.02
0.02
Other O&M
0.31
0.31
(g)
 
0.43
(h)
0.74
0.31
Asset write-offs and impairments
 
 
0.32
(o)
0.32
Decommissioning expense
(0.03)
(0.03)
 
 
0.11
(i)
0.08
(0.03)
Taxes other than income taxes
(0.02)
(0.02)
 
 
(0.01)
 
(0.03)
(0.02)
Depreciation/amortization exp.
(0.38)
(0.38)
(j)
 
0.06
(k)
(0.32)
(0.38)
Other income (deductions)-other
(0.04)
(0.04)
 
0.03
0.03
 
(0.91)
(l)
(0.92)
(0.01)
Interest exp. and other charges
(0.13)
(0.13)
(m)
 
0.03
 
(0.10)
(0.13)
Income taxes-other
0.39
0.39
(p)
(0.12)
(0.12)
(q)
0.15
(r)
0.42
0.27
Preferred dividend requirements
 
 
 
Share effect
(0.13)
(0.13)
 (n)
0.03
0.03
 
0.01
 
(0.09)
(0.10)
2020 earnings
3.31
3.31
 
(0.79)
(0.79)
 
(0.13)
 
2.39
2.52
 
 
 
 
 
 
 
 
 
 
 
Calculations may differ due to rounding
(c)
Utility operating revenue / regulatory charges and Utility income taxes-other exclude $15 million in second quarter 2020 and $61 million in second quarter 2019 for the return of unprotected excess ADIT to customers (net effect is neutral to earnings). On a year-to-date basis, Utility operating revenue / regulatory charges and Utility income taxes-other exclude $45 million in 2020 and $122 million in 2019 (net effect is neutral to earnings).
(d)
EPS effect is calculated by multiplying the pre-tax amount by the estimated income tax rate that is expected to apply and dividing by diluted average number of common shares outstanding for the prior period; income taxes-other represents income tax differences other than the tax effect of individual line items.
Utility as-reported operating revenue less fuel, fuel-related expenses and gas purchased for resale; purchased power; and regulatory charges (credits) variance analysis
2020 vs. 2019 ($ EPS)
 
2Q
YTD
Volume/weather
(0.21)
(0.24)
Retail electric price
0.36
0.70
Reg. provision for E-AR FRP
0.05
Reg. liability for tax sharing
(0.10)
Other
(0.01)
Total
0.14
0.41
(e)
The second quarter and year-to-date earnings increases were primarily driven by E-AR’s FRP; E-LA’s FRP, including recovery of the J. Wayne Leonard Power Station and the Lake Charles Power Station; E-MS’s FRP; E-MS’s vegetation rider; recovery of E-MS’s Choctaw County Generating Station; and E-TX’s TCRF. Partially offsetting was volume/weather and E-NO’s rate case. The year-to date variance also reflected a first quarter 2019 regulatory reserve at E-AR and a regulatory liability for tax sharing with E-LA customers (this partially offsets the Hurricane Isaac Act 55 income tax item discussed in footnote p).
(f)
The second quarter and year-to-date earnings decreases were due largely to lower revenues from the shutdown of Pilgrim (May 2019) and Indian Point 2 (April 2020). The year-to-date variance also reflected lower capacity and energy prices, partially offset by higher energy volume at Indian Point 3.





(g)
The second quarter and year-to-date earnings increases from lower Utility other O&M were due largely to lower non-nuclear generation expenses due to the timing and scope of outages including a delay in planned outages in 2020 as a result of the COVID-19 pandemic, lower nuclear generation expenses, and lower spending on initiatives to explore new customer products. The year-to-date variance also reflected higher nuclear insurance refunds, partially offset by higher pension and benefits expenses and higher E-MS storm damage provisions (offset in operating revenue).
(h)
The second quarter and year-to-date earnings increases from lower EWC other O&M were due largely to the shutdown of Pilgrim in May 2019 and Indian Point 2 in April 2020, as well as a decrease in severance and retention expense.
(i)
The second quarter and year-to-date earnings increases from lower EWC decommissioning expense were due to the sale of Pilgrim in 2019.
(j)
The second quarter and year-to-date earnings decreases from higher Utility depreciation expense were due primarily to higher plant in service, including the J. Wayne Leonard Power Station, the Lake Charles Power Station, and the Choctaw County Generating Station, as well as higher depreciation rates at E-MS.
(k)
The second quarter and year-to-date earnings increases from lower EWC depreciation expense were due primarily to the shutdown of Pilgrim in May 2019 and Indian Point 2 in April 2020.
(l)
The second quarter earnings increase from higher EWC other income (deductions)-other was due largely to higher gains on decommissioning trust fund investments in 2020 as compared to 2019. The year-to-date earnings decrease was due largely to performance of nuclear decommissioning trust fund investments in 2020 as compared to 2019.
(m)
The second quarter and year-to-date earnings decreases from higher Utility interest expense were due primarily to higher debt balances at E-LA and E-TX. The year-to-date variance also reflected higher debt balances at E-AR.
(n)
The earnings per share impacts from share effect were due to settlement of the equity forward (8.4 million shares settled in May 2019).
(o)
The year-to-date earnings increase from lower EWC asset write-offs and impairments was due primarily to higher impairment charges in first quarter 2019, largely refueling outage costs at Indian Point. This was partially offset by a gain on the sale of a switchyard at Pilgrim in second quarter 2019.
(p)
The year-to-date earnings increase from Utility effective income tax rate reflected two first quarter 2020 items. A $55 million tax benefit was recorded as a result of an IRS settlement related to Act 55 financing of Hurricane Isaac costs (partly offset by customer sharing, recorded as a regulatory charge discussed in footnote e). In addition, an annual tax deduction related to stock-based compensation resulted in an income tax benefit of $22 million, $20 million greater than first quarter 2019.
(q)
The year-to-date earnings decrease from Parent & Other effective income tax rate was due to an increase in income tax expense of $23 million as a result of the IRS settlement related to the Hurricane Isaac Act 55 financing (discussed in footnote p).
(r)
The year-to-date earnings increase from EWC effective income tax rate is primarily due to a first quarter 2019 accrual of $29 million of tax expense, which resulted from the sale of Vermont Yankee in January 2019.






C: Utility Financial and Operating Measures
Appendix C-1 and Appendix C-2 provide comparative summaries of Utility operating and financial measures.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Appendix C-1: Utility Operating and Financial Measures
Second Quarter and Year-to-Date 2020 vs. 2019
 
Second Quarter
Year-to-Date
 
2020
2019
%
Change
% Weather Adjusted (s)
2020
2019
%
Change
% Weather Adjusted (s)
GWh billed
 
 
 
 
 
 
 
 
Residential
7,759
7,652
1.4
5.1
15,885
16,123
(1.5)
3.1
Commercial
6,070
6,841
(11.3)
(10.8)
12,315
13,264
(7.2)
(6.8)
Governmental
570
626
(8.9)
(9.5)
1,165
1,227
(5.1)
(5.6)
Industrial
11,847
11,965
(1.0)
(1.0)
23,662
23,648
0.1
0.1
Total retail sales
26,246
27,084
(3.1)
(2.0)
53,027
54,262
(2.3)
(0.8)
Wholesale
3,111
3,170
(1.9)
 
6,228
6,984
(10.8)
 
Total sales
29,357
30,254
(3.0)
 
59,255
61,246
(3.3)
 
 
 
 
 
 
 
 
 
 
Number of electric retail customers
 
 
 
 
 
 
 
 
Residential
2,517,718
2,489,842
1.1
 
 
 
 
 
Commercial
362,812
358,545
1.2
 
 
 
 
 
Governmental
17,940
17,906
0.2
 
 
 
 
 
Industrial
42,033
41,416
1.5
 
 
 
 
 
Total retail customers
2,940,503
2,907,709
1.1
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Other O&M and refueling outage expense per MWh
$21.19
$22.79
(7.0)
 
$20.69
$21.44
(3.5)
 
 
 
 
 
 
 
 
 
 

Appendix C-2: Utility Operating Measures
Twelve Months Ended June 30, 2020 vs. 2019
 
Twelve Months Ended June 30
 
2020
2019
%
Change
% Weather Adjusted (s)
GWh billed
 
 
 
 
Residential
35,856
36,194
(0.9)
0.2
Commercial
27,806
29,015
(4.2)
(4.7)
Governmental
2,517
2,588
(2.7)
(3.2)
Industrial
48,497
48,408
0.2
0.2
Total retail sales
114,676
116,205
(1.3)
(1.1)
 
 
 
 
 

Calculations may differ due to rounding
(s)
The effects of weather were estimated using heating degree days and cooling degree days for the billing cycles from certain locations within each jurisdiction and comparing to “normal” weather based on 20-year historical data. The models used to estimate weather are updated periodically and are subject to change.

On a weather-adjusted basis for second quarter 2020, billed retail sales decreased (2.0) percent. Residential billed sales increased 5.1 percent and commercial billed sales decreased (10.8) percent driven by impacts from the COVID-19 pandemic. Industrial billed sales volume decreased (1.0) percent primarily driven by lower sales to existing large and small customers, partially offset by continued growth from new/expansion customers.






D: EWC Financial and Operating Measures
Appendix D-1 provides a comparative summary of EWC adjusted EBITDA (non-GAAP).

Appendix D-1: EWC Adjusted EBITDA - Reconciliation of GAAP to Non-GAAP Measures
Second Quarter and Year-to-Date 2020 vs. 2019
($ in millions)
Second Quarter
Year-to-Date
 
2020
2019
Change
2020
2019
Change
Net income (loss)
85
(25)
110
(25)
72
(97)
Add back: interest expense
7
9
(2)
12
18
(6)
Add back: income taxes
24
(9)
34
(6)
57
(63)
Add back: depreciation and amortization
25
38
(13)
60
76
(16)
Subtract: interest and investment income
207
75
132
35
257
(222)
Add back: decommissioning expense
51
64
(13)
102
128
(26)
Adjusted EBITDA (non-GAAP)
(15)
2
(17)
108
94
14
 
 
 
 
 
 
 
Calculations may differ due to rounding

Appendix D-2 provides a comparative summary of EWC operating and financial measures.

Appendix D-2: EWC Operating and Financial Measures
Second Quarter and Year-to-Date 2020 vs. 2019
 
Second Quarter
Year-to-Date
 
2020
2019
% Change
2020
2019
% Change
Owned capacity (MW) (t)
2,246
3,274
(31.4)
2,246
3,274
(31.4)
GWh billed
4,958
7,258
(31.7)
11,714
14,461
(19.0)
 
 
 
 
 
 
 
EWC Nuclear Fleet
 
 
 
 
 
 
Capacity factor
96%
92%
4.3
98%
89%
10.1
GWh billed
4,580
6,703
(31.7)
10,839
13,392
(19.1)
Production cost per MWh
$19.45
$19.93
(2.4)
$17.13
$19.49
(12.1)
Average energy/capacity revenue per MWh
$37.55
$37.85
(0.8)
$43.84
$48.55
(9.7)
Refueling outage days
 
 
 
 
 
 
Indian Point 3
8
 
29
 
 
 
 
 
 
 
 
Calculations may differ due to rounding
(t)
2020 excludes IP2 (1,028MW) that was shut down April 30, 2020.

See the appendix in the webcast slide presentation for EWC hedging and price disclosures.







E: Consolidated Financial Measures
Appendix E provides comparative financial measures. Financial measures in this table include those calculated and presented in accordance with GAAP, as well as those that are considered non-GAAP financial measures.

Appendix E: GAAP and Non-GAAP Financial Measures
Second Quarter 2020 vs. 2019 (See Appendix G for reconciliation of GAAP to non-GAAP financial measures)
 
 
For 12 months ending June 30
2020
2019
Change
GAAP Measures
 
 
 
As-reported ROIC
5.9%
5.5%
0.4%
As-reported ROE
12.2%
10.8%
1.4%
 
 
 
 
Non-GAAP Financial Measures
 
 
 
Adjusted ROIC
5.6%
5.5%
0.2%
Adjusted ROE
11.4%
11.0%
0.4%
 
 
 
 
As of June 30 ($ in millions, except where noted)
2020
2019
Change
GAAP Measures
 
 
 
Cash and cash equivalents
935
636
300
Available revolver capacity
4,110
4,120
(10)
Commercial paper
1,946
1,635
311
Total debt
21,493
19,054
2439
Securitization debt
232
360
(128)
Debt to capital
66.8%
65.5%
1.3%
Off-balance sheet liabilities:
 
 
 
  Debt of joint ventures - Entergy’s share
51
58
(7)
Total off-balance sheet liabilities
51
58
(7)
 
 
 
 
Storm escrow balances
373
407
(34)
 
 
 
 
Non-GAAP Financial Measures ($ in millions, except where noted)
 
 
 
Debt to capital, excluding securitization debt
66.6%
65.1%
1.5%
Net debt to net capital, excluding securitization debt
65.6%
64.3%
1.2%
Gross liquidity
5,045
4,756
289
Net liquidity
3,099
3,121
(22)
Net liquidity, including storm escrows
3,472
3,528
(56)
Parent debt to total debt, excluding securitization debt
22.0%
19.4%
2.6%
FFO to debt, excluding securitization debt
14.6%
11.8%
2.8%
FFO to debt, excluding securitization debt, return of unprotected excess ADIT, and severance and retention payments associated with exit of EWC
16.0%
15.8%
0.2%
 
 
 
 
Calculations may differ due to rounding






F: Definitions and Abbreviations and Acronyms
Appendix F-1 provides definitions of certain operating measures, as well as GAAP and non-GAAP financial measures.

Appendix F-1: Definitions
Utility Financial and Operating Measures
GWh billed
Total number of GWh billed to retail and wholesale customers
Other O&M and refueling outage expense per MWh
Other operation and maintenance expense plus nuclear refueling outage expense per MWh of billed sales
Number of electric retail customers
Average number of electric customers over the period
 
 
EWC Financial and Operating Measures
Adjusted EBITDA (non-GAAP)
Earnings before interest, income taxes, and depreciation and amortization, and excluding decommissioning expense
Average revenue under contract per kW-month (applies to capacity contracts only)
Revenue on a per unit basis at which capacity is expected to be sold to third parties, given existing contract prices and/or auction awards
Average revenue per MWh on contracted volumes
Revenue on a per unit basis at which generation output reflected in contracts is expected to be sold to third parties (including offsetting positions) at the minimum contract prices and at forward market prices at a point in time, given existing contract or option exercise prices based on expected dispatch or capacity, excluding the revenue associated with the amortization of the below-market PPA for Palisades. Revenue will fluctuate due to factors including positive or negative basis differentials and other risk management costs
Bundled capacity and energy contracts
A contract for the sale of installed capacity and related energy, priced per MWh sold
Capacity contracts
A contract for the sale of the installed capacity product in regional markets managed by NYISO and MISO
Capacity factor
Normalized percentage of the period that the nuclear plants generate power
Expected sold and market total revenue per MWh
Total energy and capacity revenue on a per unit basis at which total planned generation output and capacity is expected to be sold given contract terms and market prices at a point in time, including positive or negative basis differentials and other risk management costs, divided by total planned MWh of generation, excluding the revenue associated with the amortization of the Palisades below-market PPA
GWh billed
Total number of GWh billed to customers and financially-settled instruments
Owned capacity (MW)
Installed capacity owned by EWC
Percent of capacity sold forward
Percent of planned qualified capacity sold to mitigate price uncertainty under physical or financial transactions
Percent of planned generation under contract
Percent of planned generation output sold or purchased forward under contracts, forward physical contracts, forward financial contracts, or options that mitigate price uncertainty that may or may not require regulatory approval or approval of transmission rights or other conditions precedent; positions that are no longer classified as hedges are netted in the planned generation under contract
Planned net MW in operation
Amount of installed capacity to generate power and/or sell capacity, reflecting the shutdown of Indian Point 3 (April 30, 2021) and Palisades (May 31, 2022)
Planned TWh of generation
Amount of output expected to be generated by EWC resources considering plant operating characteristics and outage schedules, reflecting the shutdown of Indian Point 3 (April 30, 2021) and Palisades (May 31, 2022)
Production cost per MWh
Fuel and other O&M expenses according to accounting standards that directly relate to the production of electricity per MWh (based on net generation)
Refueling outage days
Number of days lost for a scheduled refueling and maintenance outage during the period
 
 






Appendix F-1: Definitions (continued)
EWC Financial and Operating Measures (continued)
Unit-contingent
Transaction under which power is supplied from a specific generation asset; if the asset is in operational outage, seller is generally not liable to buyer for any damages, unless the contract specifies certain conditions such as an availability guarantee
 
 
Financial Measures - GAAP
As-reported ROE
12-months rolling net income attributable to Entergy Corp. divided by avg. common equity
As-reported ROIC
12-months rolling net income attributable to Entergy Corporation adjusted for preferred dividends and tax-effected interest expense divided by average invested capital
Debt of joint ventures - Entergy’s share
Entergy’s share of debt issued by business joint ventures at EWC
Debt to capital
Total debt divided by total capitalization
Available revolver capacity
Amount of undrawn capacity remaining on corporate and subsidiary revolvers
Securitization debt
Debt on the balance sheet associated with securitization bonds that is secured by certain future customer collections
Total debt
Sum of short-term and long-term debt, notes payable and commercial paper, and finance leases on the balance sheet
Financial Measures - Non-GAAP
Adjusted EPS
As-reported EPS excluding adjustments
Adjusted ROE
12-months rolling adjusted net income attributable to Entergy Corporation divided by average common equity
Adjusted ROIC
12-months rolling adjusted net income attributable to Entergy Corporation adjusted for preferred dividends and tax-effected interest expense divided by average invested capital
Adjustments
Unusual or non-recurring items or events or other items or events that management believes do not reflect the ongoing business of Entergy, such as the results of the EWC segment, significant tax items, and other items such as certain costs, expenses, or other specified items
Debt to capital, excluding securitization debt
Total debt divided by total capitalization, excluding securitization debt
FFO
OCF less AFUDC-borrowed funds, working capital items in OCF (receivables, fuel inventory, accounts payable, taxes accrued, interest accrued, and other working capital accounts), and securitization regulatory charges
FFO to debt, excluding securitization debt
12-months rolling FFO as a percentage of end of period total debt excluding securitization debt
FFO to debt, excl. securitization debt, return of unprotected excess ADIT, and severance and retention payments associated with EWC exit
12-months rolling FFO excluding return of unprotected excess ADIT and severance and retention payments associated with exit of EWC as a percentage of end of period total debt excluding securitization debt
Gross liquidity
Sum of cash and available revolver capacity
Net debt to net capital, excl. securitization debt
Total debt less cash and cash equivalents divided by total capitalization less cash and cash equivalents, excluding securitization debt
Net liquidity
Sum of cash and available revolver capacity less commercial paper borrowing
Net liquidity, including storm escrows
Sum of cash, available revolver capacity, and escrow accounts available for certain storm expenses, less commercial paper borrowing
Parent debt to total debt, excl. securitization debt
End of period Entergy Corp. debt, incl. amounts drawn on credit revolver and commercial paper facilities, as a percent of consolidated total debt, excl. securitization debt







Appendix F-2 explains abbreviations and acronyms used in the quarterly earnings materials.

Appendix F-2: Abbreviations and Acronyms
ADIT
AFUDC -
borrowed funds
ALJ
AMI
ANO

APSC
ARO
bps
CCGT
CCN
CCNO
Choctaw
COD
CT
CWIP
DCRF
DOE
E-AR
E-LA
E-MS
E-NO
E-TX
EBITDA

ENP
EPS
ETR
EWC
FERC
FFO
FIN 48

FRP
GAAP
GCRR
Grand Gulf or GGNS
IIRR-G
Indian Point 1

Indian Point 2
or IP2
Indian Point 3
or IP3
IPEC
Accumulated deferred income taxes
Allowance for borrowed funds used during construction
Administrative law judge
Advanced metering infrastructure
Units 1 and 2 of Arkansas Nuclear One owned by E-AR (nuclear)
Arkansas Public Service Commission
Asset retirement obligation
Basis points
Combined cycle gas turbine
Certificate of convenience and necessity
Council of the City of New Orleans
Choctaw County Generating Station (CCGT)
Commercial operation date
Simple cycle combustion turbine
Construction work in progress
Distribution cost recovery factor
U.S. Department of Energy
Entergy Arkansas, LLC
Entergy Louisiana, LLC
Entergy Mississippi, LLC
Entergy New Orleans, LLC
Entergy Texas, Inc.
Earnings before interest, income taxes, and depreciation and amortization
Entergy Nuclear Palisades, LLC
Earnings per share
Entergy Corporation
Entergy Wholesale Commodities
Federal Energy Regulatory Commission
Funds from operations
FASB Interpretation No.48, “Accounting for Uncertainty in Income Taxes”
Formula rate plan
U.S. generally accepted accounting principles
Generation Cost Recovery Rider
Unit 1 of Grand Gulf Nuclear Station (nuclear), 90% owned or leased by SERI
Infrastructure investment recovery rider - gas
Indian Point Energy Center Unit 1 (nuclear) (shut down in 1974)
Indian Point Energy Center Unit 2 (nuclear) (shut down 4/30/20)
Indian Point Energy Center Unit 3 (nuclear)

Indian Point Energy Center (nuclear)
ISES 2

IRS
ISO
LCPS
LPSC
LTM
MCPS
MISO
Moody’s
MPSC
MTEP
Nelson 6
NDT
NOPS
NRC
NY PSC
NYISO
NYSE
OCF
OpCo
OPEB
Other O&M

P&O
Palisades
Pilgrim

PMR
PPA

PSC
PUCT
RICE
RFP
ROE
ROIC
RS Cogen
RSP
S&P
SEC
SERI
TCRF
UPSA
Vermont
Yankee
WACC
WPEC
Unit 2 of Independence Steam Electric Station (coal)
Internal Revenue Service
Independent system operator
Lake Charles Power Station (CCGT)
Louisiana Public Service Commission
Last twelve months
Montgomery County Power Station (CCGT)
Midcontinent Independent System Operator, Inc.
Moody’s Investor Service
Mississippi Public Service Commission
MISO Transmission Expansion Plan
Unit 6 of Roy S. Nelson plant (coal)
Nuclear decommissioning trust
New Orleans Power Station
U.S. Nuclear Regulatory Commission
New York Public Service Commission
New York Independent System Operator, Inc.
New York Stock Exchange
Net cash flow provided by operating activities
Utility operating company
Other post-employment benefits
Other non-fuel operation and maintenance expense
Parent & Other
Palisades Power Plant (nuclear)
Pilgrim Nuclear Power Station (nuclear, sold August 26, 2019)
Performance Management Rider
Power purchase agreement or purchased power agreement
Public service commission
Public Utility Commission of Texas
Reciprocating internal combustion engine
Request for proposals
Return on equity
Return on invested capital
RS Cogen facility (CCGT cogeneration)
Rate Stabilization Plan (E-LA Gas)
Standard & Poor’s
U.S. Securities and Exchange Commission
System Energy Resources, Inc.
Transmission cost recovery factor
Unit Power Sales Agreement
Vermont Yankee Nuclear Power Station (nuclear, sold January 11, 2019)
Weighted-average cost of capital
Washington Parish Energy Center







G: Other GAAP to Non-GAAP Reconciliations
Appendix G-1, Appendix G-2, and Appendix G-3 provide reconciliations of various non-GAAP financial measures disclosed in this news release to their most comparable GAAP measure.

Appendix G-1: Reconciliation of GAAP to Non-GAAP Financial Measures - ROIC, ROE
($ in millions except where noted)
 
Second Quarter
 
 
2020
2019
As-reported net income (loss) attributable to Entergy Corporation, rolling 12 months
(A)
1,230
961
Preferred dividends
 
18
15
Tax-effected interest expense
 
574
543
As-reported net income (loss) attributable to Entergy Corporation, rolling 12 months adjusted for preferred dividends and tax-effected interest expense
(B)
1,822
1,519
 
 
 
 
Adjustments in prior three quarters
 
(5)
8
Adjustments in current quarter
 
85
(26)
  Total adjustments, last 12 months
  
(C)
80
(18)
EWC preferred dividends and tax-effected interest expense, rolling 12 months
 
21
30
 
 
 
 
Total adjustments, adding back EWC preferred dividends and tax-effected interest expense (non-GAAP)
(D)
101
12
 
 
 
 
Adjusted earnings, rolling 12 months (non-GAAP)
(A-C)
1,150
979
Adjusted earnings, rolling 12 months including preferred dividends and tax- effected interest expense (non-GAAP)
(B-D)
1,720
1,507
 
 
 
 
Average invested capital
(E)
30,622
27,586
 
 
 
 
Average common equity
(F)
10,112
8,910
 
 
 
 
As-reported ROIC
(B/E)
5.9%
5.5%
Adjusted ROIC (non-GAAP)
[(B-D)/E]
5.6%
5.5%
As-reported ROE
(A/F)
12.2%
10.8%
Adjusted ROE (non-GAAP)
[(A-C)/F]
11.4%
11.0%
 
 
 
 
Calculations may differ due to rounding






Appendix G-2: Reconciliation of GAAP to Non-GAAP Financial Measures - Debt ratios excluding securitization debt; gross liquidity; net liquidity; net liquidity, including storm escrow balances
($ in millions except where noted)
 
Second Quarter
 
 
2020
2019
Total debt
(A)
21,493
19,054
Less securitization debt
(B)
232
360
Total debt, excluding securitization debt
(C)
21,261
18,694
Less cash and cash equivalents
(D)
935
636
Net debt, excluding securitization debt
(E)
20,326
18,058
 
 
 
 
Commercial paper
(F)
1,946
1,635
 
 
 
 
Total capitalization
(G)
32,173
29,071
Less securitization debt
(B)
232
360
Total capitalization, excluding securitization debt
(H)
31,941
28,711
Less cash and cash equivalents
(D)
935
636
Net capital, excluding securitization debt
(I)
31,006
28,075
 
 
 
 
Debt to capital
(A/G)
66.8%
65.5%
Debt to capital, excluding securitization debt (non-GAAP)
(C/H)
66.6%
65.1%
Net debt to net capital, excluding securitization debt (non-GAAP)
(E/I)
65.6%
64.3%
 
 
 
 
Available revolver capacity
(J)
4,110
4,120
 
 
 
 
Storm escrows
(K)
373
407
 
 
 
 
Gross liquidity (non-GAAP)
(D+J)
5,045
4,756
Net liquidity (non-GAAP)
(D+J-F)
3,099
3,121
Net liquidity, including storm escrows (non-GAAP)
(D+J-F+K)
3,472
3,528
 
 
 
 
Entergy Corporation notes:
 
 
 
Due September 2020
 
450
Due July 2022
 
650
650
Due September 2026
 
750
750
Due June 2030
 
600
Due June 2050
 
600
Total parent long-term debt
(L)
2,600
1,850
Revolver draw
(M)
160
150
Unamortized debt issuance costs and discounts
(N)
(32)
(9)
Total parent debt
(F+L+M+N)
4,675
3,626
 
 
 
 
Parent debt to total debt, excluding securitization debt (non-GAAP)
[(F+L+M+N)/C]
22.0%
19.4%
 
 
 
 
Calculations may differ due to rounding







Appendix G-3: Reconciliation of GAAP to Non-GAAP Financial Measures - FFO to debt, excluding securitization debt; FFO to debt, excluding securitization debt, return of unprotected excess ADIT, and severance and retention payments associated with exit of EWC
($ in millions except where noted)
 
Second Quarter
 
 
2020
2019
Total debt
(A)
21,493
19,054
Less securitization debt
(B)
232
360
Total debt, excluding securitization debt
(C)
21,261
18,694
 
 
 
 
Net cash flow provided by operating activities, rolling 12 months
(D)
3,212
2,358
 
 
 
 
AFUDC - borrowed funds, rolling 12 months
(E)
(58)
(67)
 
 
 
 
Working capital items in net cash flow provided by operating activities (rolling 12 months):
 
 
 
Receivables
 
(5)
17
Fuel inventory
 
(35)
24
Accounts payable
 
(92)
(19)
Taxes accrued
 
62
9
Interest accrued
 
5
7
Other working capital accounts
 
(15)
(81)
Securitization regulatory charges
 
123
121
Total
(F)
43
78
 
 
 
 
FFO, rolling 12 months (non-GAAP)
(G)=(D+E-F)
3,110
2,213
 
 
 
 
FFO to debt, excluding securitization debt (non-GAAP)
(G/C)
14.6%
11.8%
 
 
 
 
Estimated return of unprotected excess ADIT (rolling 12 months pre-tax)
(H)
189
651
Severance and retention payments associated with exit of EWC (rolling 12 months pre-tax)
(I)
102
97
 
 
 
 
FFO to debt, excluding securitization debt, return of unprotected excess ADIT, and severance and retention payments associated with exit of EWC (non-GAAP)
[(G+H+I)/(C)]
16.0%
15.8%
 
 
 
 
Calculations may differ due to rounding






















Financial Statements

Entergy Corporation
 
 
 
 
 
 
 
 
Consolidating Balance Sheet
 
 
 
 
 
 
 
 
June 30, 2020
 
 
 
 
 
 
 
 
(Dollars in thousands)
 
 
 
 
 
 
 
 
(Unaudited)
 
 
 
 
 
 
 
 
 
 
Utility
 
Parent & Other
 
Entergy Wholesale Commodities
 
Consolidated
ASSETS
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
CURRENT ASSETS
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 Cash and cash equivalents:
 
 
 
 
 
 
 
 
    Cash
 

$44,799

 

$5,901

 

$4,810

 

$55,510

    Temporary cash investments
 
626,373

 
9,169

 
244,416

 
879,958

     Total cash and cash equivalents
 
671,172

 
15,070

 
249,226

 
935,468

Notes receivable
 

 
(75,000
)
 
75,000

 

Accounts receivable:
 
 
 
 
 
 
 
 
   Customer
 
586,789

 

 
49,562

 
636,351

   Allowance for doubtful accounts
 
(43,281
)
 

 

 
(43,281
)
   Associated companies
 
13,680

 
(14,713
)
 
1,033

 

   Other
 
112,393

 

 
7,310

 
119,703

   Accrued unbilled revenues
 
464,647

 

 

 
464,647

     Total accounts receivable
 
1,134,228

 
(14,713
)
 
57,905

 
1,177,420

Fuel inventory - at average cost
 
158,429

 

 
6,944

 
165,373

Materials and supplies - at average cost
 
839,951

 

 
30,984

 
870,935

Deferred nuclear refueling outage costs
 
135,918

 

 
18,861

 
154,779

Prepayments and other
 
183,766

 
(16,940
)
 
76,195

 
243,021

TOTAL
 
3,123,464

 
(91,583
)
 
515,115

 
3,546,996

 
 
 
 
 
 
 
 
 
OTHER PROPERTY AND INVESTMENTS
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Investment in affiliates - at equity
 
1,427,153

 
(1,427,239
)
 
86

 

Decommissioning trust funds
 
3,734,387

 

 
2,752,208

 
6,486,595

Non-utility property - at cost (less accumulated depreciation)
323,936

 
(10
)
 
13,923

 
337,849

Other
 
453,724

 
1,212

 
7,676

 
462,612

TOTAL
 
5,939,200

 
(1,426,037
)
 
2,773,893

 
7,287,056

 
 
 
 
 
 
 
 
 
PROPERTY, PLANT, AND EQUIPMENT
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Electric
 
55,520,505

 
10,635

 
963,737

 
56,494,877

Natural gas
 
559,217

 

 

 
559,217

Construction work in progress
 
2,129,376

 
274

 
14,259

 
2,143,909

Nuclear fuel
 
569,593

 

 
66,945

 
636,538

TOTAL PROPERTY, PLANT, AND EQUIPMENT
 
58,778,691

 
10,909

 
1,044,941

 
59,834,541

Less - accumulated depreciation and amortization
 
22,698,292

 
3,025

 
826,082

 
23,527,399

PROPERTY, PLANT, AND EQUIPMENT - NET
 
36,080,399

 
7,884

 
218,859

 
36,307,142

 
 
 
 
 
 
 
 
 
DEFERRED DEBITS AND OTHER ASSETS
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Regulatory assets:
 
 
 
 
 
 
 
 
    Other regulatory assets
 
5,217,445

 

 

 
5,217,445

    Deferred fuel costs
 
240,157

 

 

 
240,157

Goodwill
 
374,099

 

 
3,073

 
377,172

Accumulated deferred income taxes
 
71,857

 
1,141

 
3,857

 
76,855

Other
 
158,645

 
9,657

 
144,177

 
312,479

TOTAL
 
6,062,203

 
10,798

 
151,107

 
6,224,108

 
 
 
 
 
 
 
 
 
TOTAL ASSETS
 

$51,205,266

 

($1,498,938
)
 

$3,658,974

 

$53,365,302

 
 
 
 
 
 
 
 
 
*Totals may not foot due to rounding.
 
 
 
 
 
 
 
 





Entergy Corporation
 
 
 
 
 
 
 
 
Consolidating Balance Sheet
 
 
 
 
 
 
 
 
June 30, 2020
 
 
 
 
 
 
 
 
(Dollars in thousands)
 
 
 
 
 
 
 
 
(Unaudited)
 
 
 
 
 
 
 
 
 
 
Utility
 
Parent & Other
 
Entergy Wholesale Commodities
 
Consolidated
LIABILITIES AND SHAREHOLDERS' EQUITY
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
CURRENT LIABILITIES
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Currently maturing long-term debt
 

$1,205,015

 

$—

 

$—

 

$1,205,015

Notes payable and commercial paper:
 
 
 
 
 
 
 
 
  Other
 

 
1,946,219

 

 
1,946,219

Account payable:
 
 
 
 
 
 
 
 
  Associated companies
 
20,456

 
(28,884
)
 
8,428

 

  Other
 
1,273,150

 
1,348

 
234,857

 
1,509,355

Customer deposits
 
408,251

 

 

 
408,251

Taxes accrued
 
320,383

 
9,538

 
(51,997
)
 
277,924

Interest accrued
 
173,416

 
24,054

 
847

 
198,317

Deferred fuel costs
 
231,250

 

 

 
231,250

Pension and other postretirement liabilities
 
46,805

 

 
13,733

 
60,538

Current portion of unprotected excess accumulated deferred
 
 
 
 
 
 
 
      income taxes
 
62,818

 
 
 
 
 
62,818

Other
 
194,984

 
1,726

 
19,504

 
216,214

TOTAL
 
3,936,528

 
1,954,001

 
225,372

 
6,115,901

 
 
 
 
 
 
 
 
 
NON-CURRENT LIABILITIES
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Accumulated deferred income taxes and taxes accrued
 
6,012,532