Highlights
-
Reaffirming 2014 guidance for cash flow and Adjusted EPS, but now
expects Adjusted EPS to be in the low end of the range
-
Includes revised outlook for hydrological conditions in Latin
America, with potential full year Adjusted EPS impact of $0.07 to
$0.10, including $0.02 in first quarter 2014; implementing actions
to mitigate this downside
-
First quarter 2014 results reduced $0.03 by forced outages and lack of
gas availability at DPL in the United States
-
Moving forward with two new platform expansion opportunities: 72 MW
fuel oil-fired barge in Panama and 122 MW gas-fired expansion of DPP
in the Dominican Republic
-
Brought in a new partner at the Guacolda generation business in Chile,
enhancing the Company's ability to extract operational synergies
-
Invested $108 million in AES Gener's $150 million equity capital raise
to fund the 531 MW Alto Maipo hydroelectric project under construction
in Chile
-
On track to complete 4,082 MW of capacity under construction through
2018, as well as the $511 million investment program to upgrade 2,400
MW of baseload coal-fired capacity at IPL in the United States
ARLINGTON, Va.--(BUSINESS WIRE)--May 8, 2014--
The AES Corporation (NYSE: AES) today reported Adjusted Earnings Per
Share (Adjusted EPS, a non-GAAP financial measure) of $0.24 for first
quarter 2014, a decrease of $0.03 from first quarter 2013. First quarter
2014 results include a $0.03 negative impact from forced outages and
lack of gas availability during extremely cold weather in January at DPL
in the United States. These results also include the positive
contributions from capital allocation decisions, which resulted in
reduced Parent interest expense and a lower share count. The Company
also benefited from improved operating performance at several businesses
in Europe, Central America and Brazil.
First quarter 2014 Diluted Earnings Per Share from Continuing Operations
decreased $0.22 to $(0.07) from first quarter 2013. These results were
driven primarily by $0.17 of impairments, largely at DPL, where the
Company impaired all of the goodwill associated with its retail
business, reflecting continued margin compression and lower than
expected retail growth, and $0.13 of expenses associated with
refinancing near-term Parent debt maturities with longer-term,
lower-coupon debt.
"Hydrology has been poor so far this year, especially in Panama and
Brazil, and could have a full year negative impact of $0.07 to $0.10 per
share. We are taking actions to mitigate this impact, through increased
cost management efforts, accelerated capital allocation and strategic
initiatives," said Andrés Gluski, AES President and Chief Executive
Officer. "In the first quarter, we closed a number of capital efficient
platform expansions and brought in equity partners to optimize our
overall risk profile. We will continue to compete all investment
opportunities with stock buybacks and debt paydowns to maximize
shareholder returns."
"Although our first quarter results were affected by forced outages and
a gas shortage at DPL in the U.S., they also reflect positive
contributions from operational improvements in Europe, Central America
and Brazil," said
Tom O'Flynn
, AES Executive Vice President and Chief
Financial Officer. "We also benefited from our capital allocation
decisions, resulting in lower Parent interest and a 3% reduction in our
share count."
|
|
|
|
|
|
|
Table 1: Key Financial Results
|
|
|
|
|
|
|
|
|
|
|
|
$ in Millions, Except Per Share Amounts
|
|
First Quarter
|
|
Full Year 2014
Guidance
|
|
|
|
2014
|
|
2013
|
|
|
Adjusted EPS1
|
|
$
|
0.24
|
|
|
$
|
0.27
|
|
|
$1.30 - $1.38
|
|
Diluted EPS from Continuing Operations
|
|
$
|
(0.07
|
)
|
|
$
|
0.15
|
|
|
N/A
|
|
Proportional Free Cash Flow1
|
|
$
|
129
|
|
|
$
|
361
|
|
|
$1,000 - $1,300
|
|
Consolidated Net Cash Provided by Operating Activities
|
|
$
|
221
|
|
|
$
|
618
|
|
|
$2,200 - $2,800
|
|
1
|
|
A non-GAAP financial measure. See “Non-GAAP Financial Measures”
for definitions and reconciliations to the most comparable GAAP
financial measures.
|
|
|
|
|
Discussion of Operating Drivers of Adjusted Pre-Tax Contribution
(Adjusted PTC, a non-GAAP financial measure) and Adjusted EPS
The Company manages its portfolio in six market-oriented Strategic
Business Units (SBUs): US (United States), Andes (Chile, Colombia and
Argentina), Brazil, MCAC (Mexico, Central America and the Caribbean),
EMEA (Europe, Middle East and Africa), and Asia.
|
|
|
Table 2: Adjusted PTC(1) by SBU and Adjusted EPS1
|
|
|
|
$ in Millions, Except Per Share Amounts
|
|
First Quarter
|
|
|
2014
|
|
2013
|
|
Variance
|
|
US
|
|
$
|
75
|
|
|
$
|
133
|
|
|
$
|
(58
|
)
|
|
Andes
|
|
53
|
|
|
81
|
|
|
(28
|
)
|
|
Brazil
|
|
69
|
|
|
42
|
|
|
27
|
|
|
MCAC
|
|
65
|
|
|
56
|
|
|
9
|
|
|
EMEA
|
|
115
|
|
|
96
|
|
|
19
|
|
|
Asia
|
|
8
|
|
|
31
|
|
|
(23
|
)
|
|
Total SBUs
|
|
$
|
385
|
|
|
$
|
439
|
|
|
$
|
(54
|
)
|
|
Corp/Other
|
|
(142
|
)
|
|
(169
|
)
|
|
27
|
|
|
Total AES Adjusted PTC1,2
|
|
$
|
243
|
|
|
$
|
270
|
|
|
$
|
(27
|
)
|
|
Adjusted Effective Tax Rate
|
|
30
|
%
|
|
26
|
%
|
|
|
|
|
Diluted Share Count
|
|
727
|
|
|
749
|
|
|
|
|
|
Adjusted EPS1
|
|
$
|
0.24
|
|
|
$
|
0.27
|
|
|
$
|
(0.03
|
)
|
|
1
|
|
A non-GAAP financial measure. See “Non-GAAP Financial Measures”
for definitions and reconciliations to the most comparable GAAP
financial measures.
|
|
2
|
|
Includes $30 million and $12 million of after-tax adjusted equity
in earnings for first quarter 2014 and first quarter 2013,
respectively.
|
|
|
|
|
For the three months ended March 31, 2014, Adjusted EPS was $0.24,
including a $0.03 negative impact from forced outages and a gas shortage
at DPL in the United States. First quarter 2013 results were $0.27,
including $0.04 received from the Beaver Valley PPA termination payment.
First quarter 2014 results reflect $0.03 of contributions from capital
allocation decisions, which resulted in reduced Parent interest expense
and a 3% lower share count, and $0.02 of improved operating performance
at several businesses in Europe, Central America and Brazil.
First quarter 2014 Adjusted PTC decreased $27 million. Key drivers of
Adjusted PTC included:
-
US: An overall decrease of $58 million, primarily driven by $49
million in net gains on the termination of the PPA at Beaver Valley in
first quarter 2013. Although the Company benefited from higher energy
prices at its wind businesses and better availability in Hawaii,
results were negatively affected by a $33 million decline at DPL as a
result of temporary forced outages and a lack of available gas at a
couple of its generation plants.
-
Andes: An overall decrease of $28 million, due to planned
maintenance and higher energy purchases in Chile, as well as
unfavorable foreign exchange rates in Argentina and Chile.
-
Brazil: An overall increase of $27 million. Despite a 15%
currency devaluation, margins improved across the Company's key
businesses. The Company's generation business, Tietê, has lower
contracted energy during the first half of the year, allowing it to
capture spot sales at higher prices during first quarter 2014. The
Company's utilities, Eletropaulo and Sul, increased due to higher
demand from weather.
-
MCAC: An overall increase of $9 million, primarily driven by
fewer outages and higher margins in the Dominican Republic, partially
offset by low hydrology in Panama.
-
EMEA: An overall increase of $19 million, largely driven by
higher operating performance in Bulgaria and Northern Ireland, as well
as contributions from new wind capacity in the United Kingdom.
-
Asia: An overall decrease of $23 million. In the Philippines,
the market operator retroactively adjusted spot prices for November
and December 2013, resulting in an unfavorable impact of $14 million
at Masinloc in first quarter 2014. These results were also driven by
planned and unplanned outages at Masinloc in the Philippines, which
were successfully completed in April 2014.
-
Corp/Other: An improvement of $27 million, driven by lower
interest expense on recourse debt and lower general and administrative
expense.
Discussion of Cash Flow
First quarter 2014 Proportional Free Cash Flow (a non-GAAP financial
measure) was $129 million, a decrease of $232 million from first quarter
2013. This decline was primarily driven by the absence of a $60 million
payment for the termination of the Beaver Valley PPA received in first
quarter 2013 and the remaining $172 million decrease was largely driven
by higher working capital needs at DPL in the United States, due to
extremely cold weather and in Brazil, due to poor hydrological
conditions. The Company expects this impact to reverse as these
businesses collect receivables during the remainder of the year.
Further, in Brazil, the Company's utilities should benefit from the 11
billion Brazilian Real aid package that the Brazilian Government has
enacted to reduce the sector's working capital needs.
First quarter 2014 Consolidated Net Cash Provided by Operating
Activities decreased $397 million to $221 million, primarily due to
higher working capital needs in Brazil and at DPL in the United States,
as discussed above.
2014 Guidance
-
The Company reaffirmed its full year 2014 Adjusted EPS guidance range
of $1.30 to $1.38, which is based on foreign currency and commodity
price assumptions as of March 31, 2014. The Company now expects its
Adjusted EPS to be in the low end of the guidance range due to its
updated expectations for the impact of dry hydrological conditions in
Latin America, with a potential full year Adjusted EPS impact of $0.07
to $0.10, including $0.02 recorded in first quarter 2014.
-
The Company reaffirmed its Proportional Free Cash Flow guidance range
of $1,000 to $1,300 million.
-
The Company reaffirmed its Consolidated Net Cash Provided by Operating
Activities guidance range of $2,200 to $2,800 million.
|
|
|
Table 3: 2014 Guidance Reconciliation
|
|
|
|
|
|
|
|
$ in Millions, Except Per Share Amounts
|
|
Full Year 2014 Guidance
|
|
Remarks
|
|
Adjusted EPS1
|
|
$1.30 - $1.38
|
|
No change; expect low end of range
|
|
Proportional Free Cash Flow1 (a)
|
|
$1,000 - $1,300
|
|
No change
|
|
Reconciling Factor2 (b)
|
|
$1,200 - $1,500
|
|
|
|
Consolidated Net Cash Provided by Operating Activities (a + b)
|
|
$2,200 - $2,800
|
|
No change
|
|
1
|
|
A non-GAAP financial measure. See "Non-GAAP Financial Measures"
for definitions and reconciliations to the most comparable GAAP
financial measures.
|
|
2
|
|
Primarily includes minority interest, maintenance capex and
environmental capex. See Appendix for details of the
reconciliation.
|
|
|
|
|
In providing its full year 2014 Adjusted EPS guidance, the Company notes
that there could be differences between expected reported earnings and
estimated operating earnings for matters such as, but not limited to:
(a) unrealized gains or losses related to derivative transactions (as of
March 31, 2014, $(0.01) per share); (b) unrealized foreign currency
gains or losses (as of March 31, 2014, $0.02 per share); (c) gains or
losses due to dispositions and acquisitions of business interests; (as
of March 31, 2014, $0.00 per share); (d) losses due to impairments (as
of March 31, 2014, $0.17 per share); and (e) costs due to the early
retirement of debt (as of March 31, 2014, $0.13 per share). At this
time, management is not able to estimate the aggregate impact, if any,
of these items on reported earnings for the year. Accordingly, the
Company is not able to provide a corresponding GAAP equivalent for its
Adjusted EPS guidance.
Additional Highlights
-
To mitigate the potential impact from more severe than anticipated
hydrological conditions, the Company has taken the following steps in
Panama:
-
Converted a 175 MW PPA from financial to physical, capping
exposure to actual production levels.
-
Signed an agreement with the Government of Panama, under which the
Government agreed to reduce the financial impact of spot
electricity purchases by $100 million through 2016 for AES Panama,
in which the Company has a 49% ownership interest.
-
Bringing in a 72 MW fuel oil-fired power barge and entering into a
5-year PPA with a government-owned generation company. This
project is expected to come on-line in 2015.
-
In Brazil, where thermal generation continues to be extremely
important as a result of poor hydrological conditions, the Company's
640 MW gas-fired Uruguaiana plant secured gas supply for 60 days. The
Company is working to secure gas on a longer-term basis.
-
In April, AES Gener exercised its right of first offer to purchase the
remaining 50% stake in the 608 MW Guacolda generation business in
Chile for $728 million. AES Gener then sold the 50% stake, less one
share, to Global Infrastructure Partners for virtually the same price,
optimizing operations at Guacolda without investing significant
capital, in order to extract operational synergies.
-
In April, AES Gener initiated an equity capital increase of $150
million to finance its equity contributions for the 531 MW Alto Maipo
hydroelectric project under construction in Chile. The Company
subscribed to the offering in-line with its ownership interest of 71%
for $108 million.
Non-GAAP Financial Measures
See Non-GAAP Financial Measures for definitions of Adjusted Earnings Per
Share, Adjusted Pre-Tax Contribution, Proportional Free Cash Flow, as
well as reconciliations to the most comparable GAAP financial measures.
Attachments
Consolidated Statements of Operations, Consolidated Balance Sheets,
Segment Information, Consolidated Statements of Cash Flows, Non-GAAP
Financial Measures, Parent Financial Information and 2014 Financial
Guidance Elements.
Conference Call Information
AES will host a conference call on Thursday, May 8, 2014 at 9:00 a.m.
Eastern Daylight Time (EDT). Interested parties may listen to the
teleconference by dialing 1-888-469-2191 at least ten minutes before the
start of the call. International callers should dial +1-415-228-5043.
The participant passcode for this call is 5814. Internet access to the
presentation materials will be available on the AES website at www.aes.com by
selecting “Investors” and then “Quarterly Financial Results.”
A telephonic replay of the call will be available from approximately
11:00 a.m. EDT on Thursday, May 8, 2014 through Thursday, May 29, 2014.
Callers in the U.S. please dial 1-866-513-4387. International callers
should dial +1-203-369-1985. The system will ask for a passcode; please
enter 5814. A webcast replay, as well as a replay in downloadable MP3
format, will be accessible at www.aes.com beginning
shortly after the completion of the call.
About AES
The AES Corporation (NYSE: AES) is a Fortune 200 global power company.
We provide affordable, sustainable energy to 21 countries through our
diverse portfolio of distribution businesses as well as thermal and
renewable generation facilities. Our workforce of 22,000 people is
committed to operational excellence and meeting the world’s changing
power needs. Our 2013 revenues were $16 billion and we own and manage
$40 billion in total assets. To learn more, please visit www.aes.com.
Safe Harbor Disclosure
This news release contains forward-looking statements within the meaning
of the Securities Act of 1933 and of the Securities Exchange Act of
1934. Such forward-looking statements include, but are not limited to,
those related to future earnings, growth and financial and operating
performance. Forward-looking statements are not intended to be a
guarantee of future results, but instead constitute AES’ current
expectations based on reasonable assumptions. Forecasted financial
information is based on certain material assumptions. These assumptions
include, but are not limited to, our accurate projections of future
interest rates, commodity price and foreign currency pricing, continued
normal levels of operating performance and electricity volume at our
distribution companies and operational performance at our generation
businesses consistent with historical levels, as well as achievements of
planned productivity improvements and incremental growth investments at
normalized investment levels and rates of return consistent with prior
experience.
Actual results could differ materially from those projected in our
forward-looking statements due to risks, uncertainties and other
factors. Important factors that could affect actual results are
discussed in AES’ filings with the Securities and Exchange Commission
(the “SEC”), including, but not limited to, the risks discussed under
Item 1A “Risk Factors” and Item 7: Management’s Discussion & Analysis in
AES’ 2013 Annual Report on Form 10-K and in subsequent reports filed
with the SEC. Readers are encouraged to read AES’ filings to learn more
about the risk factors associated with AES’ business. AES undertakes no
obligation to update or revise any forward-looking statements, whether
as a result of new information, future events or otherwise.
Any Stockholder who desires a copy of the Company’s 2013 Annual Report
on Form 10-K dated on or about February 25, 2014 with the SEC may obtain
a copy (excluding Exhibits) without charge by addressing a request to
the Office of the Corporate Secretary, The AES Corporation, 4300 Wilson
Boulevard, Arlington, Virginia 22203. Exhibits also may be requested,
but a charge equal to the reproduction cost thereof will be made. A copy
of the Form 10-K may be obtained by visiting the Company’s website at www.aes.com.
|
|
|
|
|
THE AES CORPORATION
|
|
Condensed Consolidated Statements of Operations
|
|
(Unaudited)
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
|
March 31,
|
|
|
|
2014
|
|
2013
|
|
|
|
(in millions, except
per share amounts)
|
|
Revenue:
|
|
|
|
|
|
|
|
Regulated
|
|
$
|
2,142
|
|
|
$
|
2,139
|
|
|
Non-Regulated
|
|
2,120
|
|
|
2,011
|
|
|
Total revenue
|
|
4,262
|
|
|
4,150
|
|
|
Cost of Sales:
|
|
|
|
|
|
|
|
Regulated
|
|
(1,932
|
)
|
|
(1,787
|
)
|
|
Non-Regulated
|
|
(1,536
|
)
|
|
(1,614
|
)
|
|
Total cost of sales
|
|
(3,468
|
)
|
|
(3,401
|
)
|
|
Operating margin
|
|
794
|
|
|
749
|
|
|
General and administrative expenses
|
|
(51
|
)
|
|
(54
|
)
|
|
Interest expense
|
|
(373
|
)
|
|
(370
|
)
|
|
Interest income
|
|
63
|
|
|
65
|
|
|
Loss on extinguishment of debt
|
|
(134
|
)
|
|
(47
|
)
|
|
Other expense
|
|
(8
|
)
|
|
(26
|
)
|
|
Other income
|
|
11
|
|
|
68
|
|
|
Gain on sale of investments
|
|
1
|
|
|
3
|
|
|
Goodwill impairment expense
|
|
(154
|
)
|
|
—
|
|
|
Asset impairment expense
|
|
(12
|
)
|
|
(48
|
)
|
|
Foreign currency transaction losses
|
|
(19
|
)
|
|
(30
|
)
|
|
INCOME FROM CONTINUING OPERATIONS BEFORE TAXES AND EQUITY IN
EARNINGS OF AFFILIATES
|
|
118
|
|
|
310
|
|
|
Income tax expense
|
|
(54
|
)
|
|
(83
|
)
|
|
Net equity in earnings of affiliates
|
|
25
|
|
|
4
|
|
|
INCOME FROM CONTINUING OPERATIONS
|
|
89
|
|
|
231
|
|
|
Income from operations of discontinued businesses, net of income tax
expense (benefit) of $14 and $(2), respectively
|
|
20
|
|
|
4
|
|
|
Net loss from disposal and impairments of discontinued businesses,
net of income tax benefit of $(1) and $(1), respectively
|
|
(43
|
)
|
|
(36
|
)
|
|
NET INCOME
|
|
66
|
|
|
199
|
|
|
Noncontrolling interests:
|
|
|
|
|
|
|
|
Less: Income from continuing operations attributable to
noncontrolling interests
|
|
(136
|
)
|
|
(119
|
)
|
|
Less: Loss from discontinued operations attributable to
noncontrolling interests
|
|
12
|
|
|
2
|
|
|
Total net income attributable to noncontrolling interests
|
|
(124
|
)
|
|
(117
|
)
|
|
NET (LOSS) INCOME ATTRIBUTABLE TO THE AES CORPORATION
|
|
$
|
(58
|
)
|
|
$
|
82
|
|
|
AMOUNTS ATTRIBUTABLE TO THE AES CORPORATION COMMON STOCKHOLDERS:
|
|
|
|
|
|
|
|
(Loss) income from continuing operations, net of tax
|
|
$
|
(47
|
)
|
|
$
|
112
|
|
|
Loss from discontinued operations, net of tax
|
|
(11
|
)
|
|
(30
|
)
|
|
Net (loss) income
|
|
$
|
(58
|
)
|
|
$
|
82
|
|
|
BASIC EARNINGS PER SHARE:
|
|
|
|
|
|
|
|
(Loss) Income from continuing operations attributable to The AES
Corporation common stockholders, net of tax
|
|
$
|
(0.07
|
)
|
|
$
|
0.15
|
|
|
Loss from discontinued operations attributable to The AES
Corporation common stockholders, net of tax
|
|
(0.01
|
)
|
|
(0.04
|
)
|
|
NET (LOSS) INCOME ATTRIBUTABLE TO THE AES CORPORATION COMMON
STOCKHOLDERS
|
|
$
|
(0.08
|
)
|
|
$
|
0.11
|
|
|
DILUTED EARNINGS PER SHARE:
|
|
|
|
|
|
|
|
(Loss) Income from continuing operations attributable to The AES
Corporation common stockholders, net of tax
|
|
$
|
(0.07
|
)
|
|
$
|
0.15
|
|
|
Loss from discontinued operations attributable to The AES
Corporation common stockholders, net of tax
|
|
(0.01
|
)
|
|
(0.04
|
)
|
|
NET (LOSS) INCOME ATTRIBUTABLE TO THE AES CORPORATION COMMON
STOCKHOLDERS
|
|
$
|
(0.08
|
)
|
|
$
|
0.11
|
|
|
DILUTED SHARES OUTSTANDING
|
|
724
|
|
|
749
|
|
|
DIVIDENDS DECLARED PER COMMON SHARE
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
THE AES CORPORATION
|
|
Strategic Business Unit (SBU) Information
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
|
March 31,
|
|
|
|
2014
|
|
2013
|
|
|
|
(in millions)
|
|
REVENUE
|
|
|
|
|
|
|
US
|
|
$
|
1,001
|
|
|
$
|
886
|
|
Andes
|
|
620
|
|
|
690
|
|
Brazil
|
|
1,445
|
|
|
1,429
|
|
MCAC
|
|
638
|
|
|
669
|
|
EMEA
|
|
391
|
|
|
343
|
|
Asia
|
|
168
|
|
|
133
|
|
Corporate, Other and Inter-SBU eliminations
|
|
(1
|
)
|
|
0
|
|
|
|
|
|
|
|
|
Total Revenue
|
|
$
|
4,262
|
|
|
$
|
4,150
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
THE AES CORPORATION
|
|
Condensed Consolidated Balance Sheets
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
March 31,
|
|
December 31,
|
|
|
|
2014
|
|
2013
|
|
|
|
(in millions, except share
and per share data)
|
|
ASSETS
|
|
|
|
|
|
|
|
CURRENT ASSETS
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
$
|
1,413
|
|
|
$
|
1,642
|
|
|
Restricted cash
|
|
589
|
|
|
597
|
|
|
Short-term investments
|
|
621
|
|
|
668
|
|
|
Accounts receivable, net of allowance for doubtful accounts of $124
and $134, respectively
|
|
2,586
|
|
|
2,363
|
|
|
Inventory
|
|
687
|
|
|
684
|
|
|
Deferred income taxes
|
|
181
|
|
|
166
|
|
|
Prepaid expenses
|
|
199
|
|
|
179
|
|
|
Other current assets
|
|
1,252
|
|
|
976
|
|
|
Current assets of discontinued operations and held-for-sale assets
|
|
461
|
|
|
464
|
|
|
Total current assets
|
|
7,989
|
|
|
7,739
|
|
|
NONCURRENT ASSETS
|
|
|
|
|
|
|
|
Property, Plant and Equipment:
|
|
|
|
|
|
|
|
Land
|
|
942
|
|
|
922
|
|
|
Electric generation, distribution assets and other
|
|
31,151
|
|
|
30,596
|
|
|
Accumulated depreciation
|
|
(9,943
|
)
|
|
(9,604
|
)
|
|
Construction in progress
|
|
3,203
|
|
|
3,198
|
|
|
Property, plant and equipment, net
|
|
25,353
|
|
|
25,112
|
|
|
Other Assets:
|
|
|
|
|
|
|
|
Investments in and advances to affiliates
|
|
1,030
|
|
|
1,010
|
|
|
Debt service reserves and other deposits
|
|
586
|
|
|
541
|
|
|
Goodwill
|
|
1,468
|
|
|
1,622
|
|
|
Other intangible assets, net of accumulated amortization of $149 and
$153, respectively
|
|
293
|
|
|
297
|
|
|
Deferred income taxes
|
|
680
|
|
|
666
|
|
|
Other noncurrent assets
|
|
2,445
|
|
|
2,170
|
|
|
Noncurrent assets of discontinued operations and held-for-sale assets
|
|
1,129
|
|
|
1,254
|
|
|
Total other assets
|
|
7,631
|
|
|
7,560
|
|
|
TOTAL ASSETS
|
|
$
|
40,973
|
|
|
$
|
40,411
|
|
|
LIABILITIES AND EQUITY
|
|
|
|
|
|
|
|
CURRENT LIABILITIES
|
|
|
|
|
|
|
|
Accounts payable
|
|
$
|
2,632
|
|
|
$
|
2,259
|
|
|
Accrued interest
|
|
395
|
|
|
263
|
|
|
Accrued and other liabilities
|
|
1,926
|
|
|
2,114
|
|
|
Non-recourse debt, including $259 and $267, respectively, related to
variable interest entities
|
|
2,067
|
|
|
2,062
|
|
|
Recourse debt
|
|
8
|
|
|
118
|
|
|
Current liabilities of discontinued operations and held-for-sale
businesses
|
|
812
|
|
|
837
|
|
|
Total current liabilities
|
|
7,840
|
|
|
7,653
|
|
|
NONCURRENT LIABILITIES
|
|
|
|
|
|
|
|
Non-recourse debt, including $1,022 and $979, respectively, related
to variable interest entities
|
|
13,735
|
|
|
13,318
|
|
|
Recourse debt
|
|
5,675
|
|
|
5,551
|
|
|
Deferred income taxes
|
|
1,145
|
|
|
1,119
|
|
|
Pension and other post-retirement liabilities
|
|
1,290
|
|
|
1,310
|
|
|
Other noncurrent liabilities
|
|
3,191
|
|
|
3,299
|
|
|
Noncurrent liabilities of discontinued operations and held-for-sale
businesses
|
|
378
|
|
|
432
|
|
|
Total noncurrent liabilities
|
|
25,414
|
|
|
25,029
|
|
|
Cumulative preferred stock of subsidiaries
|
|
78
|
|
|
78
|
|
|
EQUITY
|
|
|
|
|
|
|
|
THE AES CORPORATION STOCKHOLDERS’ EQUITY
|
|
|
|
|
|
|
|
Common stock ($0.01 par value, 1,200,000,000 shares authorized;
814,143,636 issued and 725,308,630 outstanding at March 31, 2014 and
813,316,510 issued and 722,508,342 outstanding at December 31, 2013)
|
|
8
|
|
|
8
|
|
|
Additional paid-in capital
|
|
8,424
|
|
|
8,443
|
|
|
Accumulated deficit
|
|
(208
|
)
|
|
(150
|
)
|
|
Accumulated other comprehensive loss
|
|
(2,967
|
)
|
|
(2,882
|
)
|
|
Treasury stock, at cost (88,835,006 shares at March 31, 2014 and
90,808,168 shares at December 31, 2013)
|
|
(1,064
|
)
|
|
(1,089
|
)
|
|
Total AES Corporation stockholders’ equity
|
|
4,193
|
|
|
4,330
|
|
|
NONCONTROLLING INTERESTS
|
|
3,448
|
|
|
3,321
|
|
|
Total equity
|
|
7,641
|
|
|
7,651
|
|
|
TOTAL LIABILITIES AND EQUITY
|
|
$
|
40,973
|
|
|
$
|
40,411
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
THE AES CORPORATION
|
|
Condensed Consolidated Statements of Cash Flows
|
|
(Unaudited)
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
|
March 31,
|
|
|
|
2014
|
|
2013
|
|
|
|
(in millions)
|
|
OPERATING ACTIVITIES:
|
|
|
|
|
|
|
|
Net income
|
|
$
|
66
|
|
|
$
|
199
|
|
|
Adjustments to net income:
|
|
|
|
|
|
|
|
Depreciation and amortization
|
|
306
|
|
|
329
|
|
|
Loss (gain) on sale of assets and investments
|
|
4
|
|
|
11
|
|
|
Impairment expenses
|
|
166
|
|
|
48
|
|
|
Deferred income taxes
|
|
56
|
|
|
13
|
|
|
Provisions for contingencies
|
|
12
|
|
|
26
|
|
|
Loss on the extinguishment of debt
|
|
134
|
|
|
47
|
|
|
Loss on disposals and impairments - discontinued operations
|
|
44
|
|
|
38
|
|
|
Other
|
|
35
|
|
|
56
|
|
|
Changes in operating assets and liabilities
|
|
|
|
|
|
|
|
(Increase) decrease in accounts receivable
|
|
(219
|
)
|
|
42
|
|
|
(Increase) decrease in inventory
|
|
(12
|
)
|
|
(4
|
)
|
|
(Increase) decrease in prepaid expenses and other current assets
|
|
(74
|
)
|
|
(192
|
)
|
|
(Increase) decrease in other assets
|
|
(444
|
)
|
|
(45
|
)
|
|
Increase (decrease) in accounts payable and other current liabilities
|
|
415
|
|
|
174
|
|
|
Increase (decrease) in income tax payables, net and other tax
payables
|
|
(206
|
)
|
|
(123
|
)
|
|
Increase (decrease) in other liabilities
|
|
(62
|
)
|
|
(1
|
)
|
|
Net cash provided by operating activities
|
|
221
|
|
|
618
|
|
|
INVESTING ACTIVITIES:
|
|
|
|
|
|
|
|
Capital Expenditures
|
|
(399
|
)
|
|
(401
|
)
|
|
Proceeds from the sale of businesses, net of cash sold
|
|
29
|
|
|
1
|
|
|
Proceeds from the sale of assets
|
|
4
|
|
|
6
|
|
|
Sale of short-term investments
|
|
1,049
|
|
|
1,335
|
|
|
Purchase of short-term investments
|
|
(993
|
)
|
|
(1,492
|
)
|
|
Increase in restricted cash, debt service reserves and other assets
|
|
(19
|
)
|
|
(45
|
)
|
|
Other investing
|
|
3
|
|
|
15
|
|
|
Net cash used in investing activities
|
|
(326
|
)
|
|
(581
|
)
|
|
FINANCING ACTIVITIES:
|
|
|
|
|
|
|
|
Borrowings under the revolving credit facilities, net
|
|
65
|
|
|
15
|
|
|
Issuance of recourse debt
|
|
750
|
|
|
—
|
|
|
Issuance of non-recourse debt
|
|
554
|
|
|
1,491
|
|
|
Repayments of recourse debt
|
|
(866
|
)
|
|
(2
|
)
|
|
Repayments of non-recourse debt
|
|
(349
|
)
|
|
(1,007
|
)
|
|
Payments for financing fees
|
|
(78
|
)
|
|
(33
|
)
|
|
Distributions to noncontrolling interests
|
|
(26
|
)
|
|
(31
|
)
|
|
Contributions from noncontrolling interests
|
|
32
|
|
|
55
|
|
|
Dividends paid on AES common stock
|
|
(36
|
)
|
|
(30
|
)
|
|
Payments for financed capital expenditures
|
|
(178
|
)
|
|
(152
|
)
|
|
Other financing
|
|
—
|
|
|
4
|
|
|
Net cash (used in) provided by financing activities
|
|
(132
|
)
|
|
310
|
|
|
Effect of exchange rate changes on cash
|
|
(22
|
)
|
|
(8
|
)
|
|
Decrease in cash of discontinued and held-for-sale businesses
|
|
30
|
|
|
17
|
|
|
Total (decrease) increase in cash and cash equivalents
|
|
(229
|
)
|
|
356
|
|
|
Cash and cash equivalents, beginning
|
|
1,642
|
|
|
1,900
|
|
|
Cash and cash equivalents, ending
|
|
$
|
1,413
|
|
|
$
|
2,256
|
|
|
SUPPLEMENTAL DISCLOSURES:
|
|
|
|
|
|
|
|
Cash payments for interest, net of amounts capitalized
|
|
$
|
226
|
|
|
$
|
234
|
|
|
Cash payments for income taxes, net of refunds
|
|
$
|
237
|
|
|
$
|
295
|
|
|
|
|
|
|
|
|
|
|
|
|
THE AES CORPORATION
|
|
NON-GAAP FINANCIAL MEASURES
|
|
(Unaudited)
|
|
|
|
RECONCILIATION OF ADJUSTED PRE-TAX CONTRIBUTION (PTC) AND
ADJUSTED EPS
|
Adjusted pre-tax contribution (“adjusted PTC”) and Adjusted earnings per
share (“adjusted EPS”) are non-GAAP supplemental measures that are used
by management and external users of our consolidated financial
statements such as investors, industry analysts and lenders.
We define adjusted PTC as pre-tax income from continuing operations
attributable to AES excluding gains or losses of the consolidated entity
due to (a) unrealized gains or losses related to derivative
transactions, (b) unrealized foreign currency gains or losses, (c) gains
or losses due to dispositions and acquisitions of business interests,
(d) losses due to impairments, and (e) costs due to the early retirement
of debt. Adjusted PTC also includes net equity in earnings of affiliates
on an after-tax basis.
We define adjusted EPS as diluted earnings per share from continuing
operations excluding gains or losses of the consolidated entity due to
(a) unrealized gains or losses related to derivative transactions,
(b) unrealized foreign currency gains or losses, (c) gains or losses due
to dispositions and acquisitions of business interests, (d) losses due
to impairments, and (e) costs due to the early retirement of debt.
The GAAP measure most comparable to adjusted PTC is income from
continuing operations attributable to AES. The GAAP measure most
comparable to adjusted EPS is diluted earnings per share from continuing
operations. We believe that adjusted PTC and adjusted EPS better reflect
the underlying business performance of the Company and are considered in
the Company’s internal evaluation of financial performance. Factors in
this determination include the variability due to unrealized gains or
losses related to derivative transactions, unrealized foreign currency
gains or losses, losses due to impairments and strategic decisions to
dispose of or acquire business interests or retire debt, which affect
results in a given period or periods. In addition, for adjusted PTC,
earnings before tax represents the business performance of the Company
before the application of statutory income tax rates and tax
adjustments, including the effects of tax planning, corresponding to the
various jurisdictions in which the Company operates. Adjusted PTC and
adjusted EPS should not be construed as alternatives to income from
continuing operations attributable to AES and diluted earnings per share
from continuing operations, which are determined in accordance with GAAP.
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Three Months Ended
|
|
|
|
March 30, 2014
|
|
March 30, 2013
|
|
|
|
Net of
NCI(1)
|
|
Per Share
(Diluted)
Net of
NCI(1) and
Tax
|
|
|
Net of
NCI(1)
|
|
Per Share
(Diluted)
Net of
NCI(1) and
Tax
|
|
|
|
|
(In millions, except per share amounts)
|
|
Loss (Income) from continuing operations attributable to AES and
Diluted EPS
|
|
$
|
(47
|
)
|
|
$
|
(0.07
|
)
|
|
|
$
|
112
|
|
|
$
|
0.15
|
|
|
|
Add back income tax expense from continuing operations attributable
to AES
|
|
(25
|
)
|
|
|
|
|
|
31
|
|
|
|
|
|
|
Pre-tax contribution
|
|
$
|
(72
|
)
|
|
|
|
|
|
$
|
143
|
|
|
|
|
|
|
Adjustments
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Unrealized derivative (gains)/ losses(2)
|
|
$
|
(10
|
)
|
|
$
|
(0.01
|
)
|
|
|
$
|
14
|
|
|
$
|
0.02
|
|
|
|
Unrealized foreign currency transaction (gains)/ losses(3)
|
|
26
|
|
|
0.02
|
|
|
|
25
|
|
|
0.01
|
|
|
|
Disposition/ acquisition (gains)
|
|
(1
|
)
|
|
—
|
|
|
|
(3
|
)
|
|
—
|
|
|
|
Impairment losses
|
|
166
|
|
|
0.17
|
|
(4)
|
|
48
|
|
|
0.05
|
|
(5)
|
|
Loss on extinguishment of debt
|
|
134
|
|
|
0.13
|
|
(6)
|
|
43
|
|
|
0.04
|
|
(7)
|
|
Adjusted pre-tax contribution and Adjusted EPS
|
|
$
|
243
|
|
|
$
|
0.24
|
|
|
|
$
|
270
|
|
|
$
|
0.27
|
|
|
|
___________________
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
|
NCI is defined as Noncontrolling Interests
|
|
(2)
|
|
Unrealized derivative (gains) losses were net of income tax per
share of $(0.01) and $0.00 in the three months ended March 31, 2014
and 2013, respectively.
|
|
(3)
|
|
Unrealized foreign currency transaction (gains) losses were net of
income tax per share of $0.01 and $0.01 in the three months ended
March 31, 2014 and 2013, respectively.
|
|
(4)
|
|
Amount primarily relates to the goodwill impairments at DPL of $136
million ($93 million, or $0.13 per share, net of income tax per
share of $0.06), at Buffalo Gap of $18 million ($18 million, or
$0.03 per share, net of income tax per share of $0.00) and asset
impairment at DPL of $12 million ($8 million, or $0.01 per share,
net of income tax per share of $0.00).
|
|
(5)
|
|
Amount primarily relates to asset impairment at Beaver Valley of $46
million ($32 million, or $0.04 per share, net of income tax per
share of $0.02).
|
|
(6)
|
|
Amount primarily relates to the loss on early retirement of debt at
Corporate of $132 million ($91 million, or $0.13 per share, net of
income tax per share of $0.06).
|
|
(7)
|
|
Amount primarily relates to the loss on early retirement of debt at
Masinloc of $43 million ($28 million, or $0.04 per share, net of
noncontrolling interest of $3 million and of income tax per share of
$0.01).
|
|
|
|
|
|
THE AES CORPORATION
|
|
NON-GAAP FINANCIAL MEASURES
|
|
(Unaudited)
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
|
March 31,
|
|
|
|
2014
|
|
2013
|
|
|
|
(in millions)
|
|
Calculation of Maintenance Capital Expenditures for Free Cash
Flow (1) Reconciliation Below:
|
|
|
|
|
|
|
Maintenance Capital Expenditures
|
|
$
|
137
|
|
|
$
|
186
|
|
Environmental Capital Expenditures
|
|
33
|
|
|
30
|
|
Growth Capital Expenditures
|
|
407
|
|
|
337
|
|
Total Capital Expenditures
|
|
$
|
577
|
|
|
$
|
553
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of Proportional Operating Cash Flow(2)
|
|
|
|
Consolidated Operating Cash Flow
|
|
$
|
221
|
|
|
$
|
618
|
|
Less: Proportional Adjustment Factor
|
|
(20
|
)
|
|
104
|
|
Proportional Operating Cash Flow (2)
|
|
$
|
241
|
|
|
$
|
514
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of Free Cash Flow(1)
|
|
|
|
|
|
|
Consolidated Operating Cash Flow
|
|
$
|
221
|
|
|
$
|
618
|
|
Less: Maintenance Capital Expenditures, net of reinsurance proceeds
|
|
137
|
|
|
186
|
|
Less: Non-Recoverable Environmental Capital Expenditures
|
|
11
|
|
|
21
|
|
Free Cash Flow(1)
|
|
$
|
73
|
|
|
$
|
411
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of Proportional Free Cash Flow(1),(2)
|
|
|
|
|
|
|
Proportional Operating Cash Flow
|
|
$
|
241
|
|
|
$
|
514
|
|
Less: Proportional Maintenance Capital Expenditures, net of
reinsurance proceeds
|
|
104
|
|
|
137
|
|
Less: Proportional Non-Recoverable Environmental Capital Expenditures
|
|
8
|
|
|
16
|
|
Proportional Free Cash Flow(1),(2)
|
|
$
|
129
|
|
|
$
|
361
|
|
|
|
|
|
|
|
|
|
|
(1)
|
|
Free cash flow (a non-GAAP financial measure) is defined as net cash
from operating activities less maintenance capital expenditures
(including non-recoverable environmental capital expenditures), net
of reinsurance proceeds from third parties. AES believes that free
cash flow is a useful measure for evaluating our financial condition
because it represents the amount of cash provided by operations less
maintenance capital expenditures as defined by our businesses, that
may be available for investing or for repaying debt.
|
|
|
|
|
|
(2)
|
|
AES is a holding company that derives its income and cash flows from
the activities of its subsidiaries, some of which may not be
wholly-owned by the Company. Accordingly, the Company has presented
certain financial metrics which are defined as Proportional (a
non-GAAP financial measure). Proportional metrics present the
Company's estimate of its share in the economics of the underlying
metric. The Company believes that the Proportional metrics are
useful to investors because they exclude the economic share in the
metric presented that is held by non-AES shareholders. For example,
Net Cash from Operating Activities (Operating Cash Flow) is a GAAP
metric which presents the Company's cash flow from operations on a
consolidated basis, including operating cash flow allocable to
noncontrolling interests. Proportional Operating Cash Flow removes
the share of operating cash flow allocable to noncontrolling
interests and therefore may act as an aid in the valuation of the
Company. Proportional metrics are reconciled to the nearest GAAP
measure. Certain assumptions have been made to estimate our
proportional financial measures. These assumptions include: (i) the
Company's economic interest has been calculated based on a blended
rate for each consolidated business when such business represents
multiple legal entities; (ii) the Company's economic interest may
differ from the percentage implied by the recorded net income or
loss attributable to noncontrolling interests or dividends paid
during a given period; (iii) the Company's economic interest for
entities accounted for using the hypothetical liquidation at book
value method is 100%; (iv) individual operating performance of the
Company's equity method investments is not reflected and (v)
inter-segment transactions are included as applicable for the metric
presented.
|
|
|
|
The AES Corporation
|
|
Parent Financial Information
|
|
Parent only data: last four quarters
|
|
|
|
|
|
|
|
|
|
(in millions)
|
|
Quarters Ended
|
|
Total subsidiary distributions & returns
of capital to Parent
|
|
March 31,
2014
|
|
December
31, 2013
|
|
September
30, 2013
|
|
June 30,
2013
|
|
|
Actual
|
|
Actual
|
|
Actual
|
|
Actual
|
|
Subsidiary distributions(1) to Parent & QHCs
|
|
$
|
1,290
|
|
$
|
1,260
|
|
$
|
1,308
|
|
$
|
1,291
|
|
Returns of capital distributions to Parent & QHCs
|
|
40
|
|
193
|
|
63
|
|
75
|
|
Total subsidiary distributions & returns of capital to Parent
|
|
$
|
1,330
|
|
$
|
1,453
|
|
$
|
1,371
|
|
$
|
1,366
|
|
|
|
|
|
|
|
|
|
|
|
Parent only data: quarterly
|
|
|
|
|
|
|
|
|
|
($ in millions)
|
|
Quarter Ended
|
|
Total subsidiary distributions & returns
of capital to Parent
|
|
March 31,
2014
|
|
December
31, 2013
|
|
September
30, 2013
|
|
June 30,
2013
|
|
|
Actual
|
|
Actual
|
|
Actual
|
|
Actual
|
|
Subsidiary distributions to Parent & QHCs
|
|
$
|
232
|
|
$
|
402
|
|
$
|
348
|
|
$
|
308
|
|
Returns of capital distributions to Parent & QHCs
|
|
9
|
|
30
|
|
0
|
|
1
|
|
Total subsidiary distributions & returns of capital to Parent
|
|
$
|
241
|
|
$
|
432
|
|
$
|
348
|
|
$
|
309
|
|
|
|
|
|
|
|
|
|
|
|
Parent Company Liquidity (2)
|
|
|
|
($ in millions)
|
|
Balance at
|
|
|
|
March 31,
2014
|
|
December
31, 2013
|
|
September
30, 2013
|
|
June 30,
2013
|
|
|
|
Actual
|
|
Actual
|
|
Actual
|
|
Actual
|
|
Cash at Parent & Cash at QHCs (3)
|
|
$
|
26
|
|
$
|
132
|
|
$
|
196
|
|
$
|
111
|
|
Availability under credit facilities
|
|
799
|
|
799
|
|
797
|
|
797
|
|
Ending liquidity
|
|
$
|
825
|
|
$
|
931
|
|
$
|
993
|
|
$
|
908
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
|
Subsidiary distributions should not be construed as an alternative
to Net Cash Provided by Operating Activities which are determined in
accordance with GAAP. Subsidiary distributions are important to the
Parent Company because the Parent Company is a holding company that
does not derive any significant direct revenues from its own
activities but instead relies on its subsidiaries’ business
activities and the resultant distributions to fund the debt service,
investment and other cash needs of the holding company. The
reconciliation of the difference between the subsidiary
distributions and the Net Cash Provided by Operating Activities
consists of cash generated from operating activities that is
retained at the subsidiaries for a variety of reasons which are both
discretionary and non-discretionary in nature. These factors
include, but are not limited to, retention of cash to fund capital
expenditures at the subsidiary, cash retention associated with
non-recourse debt covenant restrictions and related debt service
requirements at the subsidiaries, retention of cash related to
sufficiency of local GAAP statutory retained earnings at the
subsidiaries, retention of cash for working capital needs at the
subsidiaries, and other similar timing differences between when the
cash is generated at the subsidiaries and when it reaches the Parent
Company and related holding companies.
|
|
|
|
|
|
(2)
|
|
Parent Company Liquidity is defined as cash at the Parent Company
plus availability under corporate credit facilities plus cash at
qualified holding companies (QHCs). AES believes that unconsolidated
Parent Company liquidity is important to the liquidity position of
AES as a Parent Company because of the non-recourse nature of most
of AES’s indebtedness.
|
|
|
|
|
|
(3)
|
|
The cash held at QHCs represents cash sent to subsidiaries of the
company domiciled outside of the US. Such subsidiaries had no
contractual restrictions on their ability to send cash to AES, the
Parent Company. Cash at those subsidiaries was used for investment
and related activities outside of the US. These investments included
equity investments and loans to other foreign subsidiaries as well
as development and general costs and expenses incurred outside the
US. Since the cash held by these QHCs is available to the Parent,
AES uses the combined measure of subsidiary distributions to Parent
and QHCs as a useful measure of cash available to the Parent to meet
its international liquidity needs.
|
|
|
|
|
|
|
|
|
|
|
|
THE AES CORPORATION
|
|
|
|
|
|
2014 FINANCIAL GUIDANCE ELEMENTS(1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2014 Financial Guidance (as of 5/8/14)
|
|
|
|
Consolidated
|
|
Proportional
|
|
Income Statement Guidance
|
|
|
|
|
|
Adjusted Earnings Per Share
|
|
$1.30 to $1.38
|
|
|
|
Cash Flow Guidance
|
|
|
|
|
|
Net Cash Provided by Operating Activities
|
|
$2,200 to $2,800 million
|
|
|
|
Free Cash Flow (4)
|
|
|
|
$1,000 to $1,300 million
|
|
Reconciliation of Free Cash Flow Guidance
|
|
|
|
|
|
Net Cash from Operating Activities
|
|
$2,200 to $2,800 million
|
|
$1,650 to $1,950 million
|
|
Less: Maintenance Capital Expenditures
|
|
$700 to $1,000 million
|
|
$500 to $800 million
|
|
Free Cash Flow (4)
|
|
$1,350 to $1,950 million
|
|
$1,000 to $1,300 million
|
|
|
|
|
|
|
|
|
|
(1)
|
|
2014 Guidance is based on expectations for future foreign exchange
rates and commodity prices as of March 31, 2014.
|
|
|
|
|
|
(2)
|
|
AES is a holding company that derives its income and cash flows from
the activities of its subsidiaries, some of which may not be
wholly-owned by the Company. Accordingly, the Company has presented
certain financial metrics which are defined as Proportional (a
non-GAAP financial measure). Proportional metrics present the
Company's estimate of its share in the economics of the underlying
metric. The Company believes that the Proportional metrics are
useful to investors because they exclude the economic share in the
metric presented that is held by non-AES shareholders. For example,
Net Cash from Operating Activities (Operating Cash Flow) is a GAAP
metric which presents the Company's cash flow from operations on a
consolidated basis, including operating cash flow allocable to
noncontrolling interests. Proportional Operating Cash Flow removes
the share of operating cash flow allocable to noncontrolling
interests and therefore may act as an aid in the valuation of the
Company. Proportional metrics are reconciled to the nearest GAAP
measure. Certain assumptions have been made to estimate our
proportional financial measures. These assumptions include: (i) the
Company's economic interest has been calculated based on a blended
rate for each consolidated business when such business represents
multiple legal entities; (ii) the Company's economic interest may
differ from the percentage implied by the recorded net income or
loss attributable to noncontrolling interests or dividends paid
during a given period; (iii) the Company's economic interest for
entities accounted for using the hypothetical liquidation at book
value method is 100%; (iv) individual operating performance of the
Company's equity method investments is not reflected and (v)
inter-segment transactions are included as applicable for the metric
presented.
|
|
|
|
|
|
(3)
|
|
Adjusted earnings per share (a non-GAAP financial measure) is
defined as diluted earnings per share from continuing operations
excluding gains or losses of the consolidated entity due to (a)
unrealized gains or losses related to derivative transactions, (b)
unrealized foreign currency gains or losses, (c) gains or losses due
to dispositions and acquisitions of business interests, (d) losses
due to impairments, and (e) costs due to the early retirement of
debt. The GAAP measure most comparable to Adjusted EPS is diluted
earnings per share from continuing operations. AES believes that
adjusted earnings per share better reflects the underlying business
performance of the Company, and is considered in the Company's
internal evaluation of financial performance. Factors in this
determination include the variability due to unrealized gains or
losses related to derivative transactions, unrealized foreign
currency gains or losses, losses due to impairments and strategic
decisions to dispose or acquire business interests or retire debt,
which affect results in a given period or periods. Adjusted earnings
per share should not be construed as an alternative to diluted
earnings per share from continuing operations, which is determined
in accordance with GAAP.
|
|
|
|
|
|
(4)
|
|
Free Cash Flow is reconciled above. Free cash flow (a non-GAAP
financial measure) is defined as net cash from operating activities
less maintenance capital expenditures (including environmental
capital expenditures), net of reinsurance proceeds from third
parties. AES believes that free cash flow is a useful measure for
evaluating our financial condition because it represents the amount
of cash provided by operations less maintenance capital expenditures
as defined by our businesses, that may be available for investing or
for repaying debt.
|
|
|
|
|
Source: The AES Corporation
The AES Corporation
Investor Contact:
Ahmed Pasha, 703-682-6451
or
Media
Contact:
Amy Ackerman, 703-682-6399