Entergy Corporation · NYSE:ETR
Entergy — Morgan Stanley 13th Annual Global Electricity & Energy Conference (March 2006)
27 slides from Entergy's conference presentation, Mar 16, 2006
Slide 1: A Focus on Rebuilding - A Vision for Growth
A Focus on Rebuilding - A Vision for Growth Morgan Stanley 13th Annual Global Electricity & Energy Conference Leo Denault Executive Vice President and Chief Financial Officer = March 16, 2006 Entergy,
Slide 2: Safe Harbor and Reg G Compliance
Safe Harbor and Reg G Compliance In his presentation and fom tie time, Entergymakes statements concemin its expections, belts, plans, obecives, gels, ategls, and ture vents of periomance. Such statements are Yowardlocking satemerts’uitin the meaning efthe Pate Secures Lagaton Reform At of 1986 ‘Atho
Slide 3: Presentation Outline
Presentatio ine LL A Quick Review of 2006 Agenda and Accomplishments - Progress continues on 2006 agenda, a year that provides the foundation for future EPS growth ee A Closer Look Beyond 2006
Slide 4: 2006 Agenda Is Centered Around Stability, Recovery and Growth
2006 Agenda Is Centered Around 2006 Key Ini es: Scorecard fas of 3106) 2006 Initiative Recovery: Complete @ Incomplete Stability/Growth: () Complete _@ Incomplete Commence recovery of Obtain insurance proceeds storm costs © _Receive/advocate for federal assistance Obtain regulatory relief Remove neg
Slide 5: Early Progress on Our 2006 Agenda
Early Progress on Our 2006 Agenda 2006 Agenda - Recent Events As of 3/13/06 Nuclear Utility January Issued draft. Pilgrim and VY Sent NRC a lett to submit a lice application for Fi February for 95MW up approved M TIC recove over 15 yrs MS Governt securitizatio
Slide 6: 2006 Earnings Drivers Will Unfold Throughout the Year
2006 Earnings Drivers Will Unfold Throughout the Year Operational Earnings (excluding ENOI) 05; $ishare* 1.65 1.30 0.78 0.67 1stQtr 2ndQtr 3rdQtr 4th Qtr ‘As-Reported (excluding ENO!) O77 1.29 1.62 0.51 ‘*Quartorly EPS retledts Retail discontinred operators. Year Over Year Observations 2005 EPS cons
Slide 7: 2006 Will Provide the Foundation for EPS Growth in Coming Years
2006 Will Provide the Foundation for EPS Growth in Coming Years Operational Earnings 05-06 Guidance; $ishare 4.65 Midpoint 4.50-4.80 Range So me aE tees Parent’ Nuclear Wholesale Other 0.28 (0.05) 0.02 05 06 Guidance (excluding ENO!) (excluding ENO) As-Reported $4.19 $4.93 Midpoint” $4.78-6.08 Range
Slide 8: Presentation Outline
Presentatio ine Dt A Quick Review of 2006 Agenda and Accomplishments PO Dt A Closer Look Beyond 2006 - Opportunities being advanced to support long-term aspirations, including overall aspiration of top quartile total shareholder return
Slide 9: Entergy's Framework for Long-Term Growth and Value Creation Remains the Same
Entergy’s Framework for Long-Term Growth and Value Creation Remains the Same Entergy’s Business Model Enhance the Grow Optimize the Value of What the Balance Sheet You Have Business for Flexibility = Implement value Acquire generation creating through Supply Plan Continue economic regulatory Build n
Slide 10: Regulatory Strategies Are Designed to Align Stakeholder Interests
Regulatory Strategies Are Designed to Align Stakeholder Interests Regulatory Strategies Regulation Strategy Jurisdictions Estimated Timing FormulaRate | LA,MSand | Annual filings Plans NO. Rate Cases Ms 06 filing for Attala / implement 07 AR 06 decision to file a case 1X Can file mid-07 / effective
Slide 11: Texas Rate Case Offers Opportunity to Fully Restore Returns
Texas Rate Case Effective 008 Offers Opportunity to Fully Restore Returns to an Acceptable Level Entergy Gulf States-Texas Entergy Gulf States-Texas Operational ROE* Earnings 03 and 05; % 05; $M Allowed 10.95 26 104 82 66 Pre-Rate Case Current 05 Shortfall 05 @ 10.95% 03 05 Allowed ROE As- Reported
Slide 12: Jurisdictional Separation Targeted for Mid 2007
Jurisdictional Separation Targeted for Mid 2007 Will Open New Avenues in Both Jurisdictions Entergy Gulf States Alternatives Before and After Jurisdictional Separation Joint capitalization for both jurisdictions Joint resource planning for two jurisdictions Jointly owned transmission and generation
Slide 13: Market Prices for Entergy Nuclear Fleet Enhances Growth Prospects
Market Prices for Entergy Nuclear Fleet Enhances Growth Prospects and Requires Vigilant Risk Management Revenue Growth Opportunity and Risk 08E; Market Price in $/MWh (x-axis) vs. Revenue in $B (y-axis) O8E Revenue 08 forward prices 25 r) 2.0 | 08E Sold + Unsold i Price OpportunityiRisk: Revenue +43
Slide 14: Reinvigorated Cost Management Initiatives Are Expected to Partially Offset Inflation
Reinvigorated Cost Management Initiatives Are Expected to Partially Offset Inflation Effects Inflation Trends 92.05; % 8 he CPI - Medical Costs Sap oS Se CPI- All 92 94 96 98 00 02 04 Source: Bureau of Labor Statisties and Economy com onaa Non-Fuel 0&M Expense* 03-05; $B* 28 25 23 2.0 03 04 05 1 +2
Slide 15: Other Capital Deployment Alternatives Are Continually Evaluated
Other Capital Deployment Alternatives Are Continually Evaluated Projected Cash Available for Deployment Capital Deployment Tactics 06-08; $B Deployment Method Investments | Cash on hand 28 © Debt a Equity 4 Debt Maturity ( repayments | » Repay revolvers « Call bonds Equity Equity © Open market purch
Slide 16: Asset Acquisitions and M&A Are Possibilities
Asset Acquisitions and M&A Are Possibilities With Many Ways to Transact Portfolio Transformation / M&A Transaction Criteria Strategic Financial Ability to Rationale Impact Transact Areas of Interest @ Assets © Contracts © mea © Divestitures - CCGT and solid fuel plants for the Utility to fill long-
Slide 17: Supply Plan Initiative Is Evaluating Construction of a New Solid Fuel Plant
Supply Plan Initiative Is Evaluating Construction of a New Solid Fuel Plant Solid Fuel Self-Build Alternative To be evaluated in 06 RFP Unit Repower Little Gypsy 3 Owner Entergy Louisiana Location _| LaPlace, Louisiana Capacity | ~500 MW Technology | Circulating Fluidized Bed Fuel Coal andfor pet co
Slide 18: Entergy Is Preserving Its Option to Participate in Next Generation of Nuclear
Entergy Is Preserving Its Option to Participate in the Next Generation of Nuclear Development New Nuclear Pursuits / Events N.msterteneay baad Construction and Operating License (COL) at Grand Gulf (NuStart / DOE matching funds) COL at River Bend (Entergy) Early Site Permit (ESP) at Grand Gulf (Ente
Slide 19: Creating Value Through Operational Excellence and Portfolio Management
Creating Value Throug Operational Excellence and Portfolio Management Hlustrative Strategic Platform Continuum Strategic Risk Target Business Value Value Profile Profile Leverage Drivers Creation Distribution low High Regulated une > Today's Economic Reliability and Dividends Utility target for fact
Slide 20: Key Takeaways
Key Takeaways 2006: Stability, Recovery and Growth e Successful execution of our 2006 agenda will lay the foundation for achieving long-term aspirations Beyond 2006: Long-term Growth and Value Creation e Our strategic focus—on operational excellence and portfolio management—is unchanged Growth initi
Slide 21: A Focus on Rebuilding - A Vision for Growth
A Focus on Rebuilding - A Vision for Growth Morgan Stanley 13th Annual Global Electricity & Energy Conference Leo Denault Executive Vice President and Chief Financial Officer = March 16, 2006 Entergy,
Slide 22: Appendix
Appendix “= Entergy.
Slide 23: Appendix: Reg G Reconciliations
Appendix: Reg G Reconciliations Table 1: Earnings - Recon 2005 Actual and 2006 Guidance in of GAAP to Non-GAAP Measures ($ per share} Consolidated As-Reported Earnings Less Enteray New Orleans As-Reported excluding Enteray New Orleans @ Less Speciafitems Utility, Parent & Other Retail business impai
Slide 24: Appendix: Reg G Reconciliations
Appendix: Reg G Reconciliations Table 2: Earnings - Reconcil First Quarter through Fourth Quarter 2005, jon of GAAP to Non-GAAP Measures ($ per share} Consolidated As-Reported Earnings Less Enteray New Orleans As-Reported excluding Enterqy New Orleans Less Special tems Utility, Parent & Other Retail
Slide 25: Appendix: Reg G Reconciliations
Appendix: Reg G Reconciliations Table 3: Return on Equity - Enterqy Gulf States-Texas Reconciliation of GAAP to Non-GAAP Measures 2003 and 2005 i) 2003 2005 As-Reported ROE @ 00) 82 Less Speciafitems Voluntary severance plan 0.8) : SFAS implementation 0.2) : River Bend loss prot 66 Total special ite
Slide 26: Appendix: Reg G Reconciliations
Appendix: Reg G Reconciliations Table 4: Non-Fuel O&M - Reconciliation of GAAP to Non-GAAP Measures 2003-2005 (6 in millions) As-Reported Non-Fuel O&M Less Adjustments Utility Voluntary severance plan Deconsolidation of Entergy New Orleans Total Entergy Nuclear Voluntary severance plan Total Adjuste
Slide 27: Appendix: Reg G Reconciliations
Appendix: Reg G Reconciliations Table 5: Projected Cash Av 2006 2008 (Sin billi ns) Net cash flow provided by operating acti Less: Net nuclear fuel purchases Decommissioning trust contributions Planned capital expenditures Preferred dividends Free cash flow Common dividends Net share repurchases (in
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