Entergy Corporation · NYSE:ETR
Entergy — Deutsche Bank 10th Annual Electric Power Conference (June 2005)
21 slides from Entergy's conference presentation, Jun 14, 2005
Slide 1: Investing for Growth and Value Creation
Investing for Growth and Value Creation Deutsche Bank 10th Annual Electric Power Conference Leo Denault Executive Vice President aA and Chief Financial Officer = June 14, 2005 Entergy,
Slide 2: Safe Harbor and Reg G Compliance
Safe Harbor and Reg G Compliance In this presentation ard from time to time, Entergy makes statements concerning is exnectations, beliefs, plans, objectives, goals, strateges, and future events or performance. Such statements ae "forward-looking statements’ within the rearing of the Private Securiti
Slide 3: Discussion
Discussion ine _ Review Entergy’s strategy and its investment approach SESS xy" opportunities that Entergy is currently pursuing ) impact on Entergy’s financial aspirations m4
Slide 4: Entergy Focuses on Long-Term Growth and Value Creation
Entergy Focuses on Long-Term Growth and Value Creation Entergy’s Business Model — Operational Enhance the Value Grow the Optimize the of What You Have Business Balance Sheet Enhance the value of Actively manage Allocate “capital at legacy positions portfolio requires: tisk” across assets, businesses
Slide 5: Rigorous Analysis of External Environment
Rigorous Analysis of External Environment Is Conducted to Develop Entergy’s Point of View Sample Key Market Drivers 05-09 Trend Implication for Investments Low T High Capital Capacity: More capital chasing existing deals, a particularly nuclear and contracted fossil assets l=Interest Rates C=Capacit
Slide 6: Disciplined, Iterative Process
Disciplined, Iterative Process Considers All Alternatives Key Questions What is Entergy’s optimal capital structure? Does Entergy have excess capital to deploy? What are the investment hurdles? What is the impact of a specific investment on Entergy’s overall risk profile? Is Entergy stock a good inv
Slide 7: Process Execution Has Driven Recent Portfolio Management Actions
Process Execution Has Driven Recent Portfolio Management Actions Portfolio Management Key Recent Events 03-Today 9/03 Signed services agreement for Cooper plant 1/04 Signed agreement to acquire 718 MW Perryville plant 1/04 | Sold the 50% interest in 320 MW Crete plant 11/04 | Sold Entergy-Koch Tradi
Slide 8: Strategic Opportunities Undergo Continuous Evaluation
Strategic Opportunities Undergo Continuous Evaluation Strategic Growth Opportunities Nuclear Acquire additional U.S. plants Execute new operating agreements in U.S. and other markets Transform asset portfolio into a business (i.e., add other generation types or short position) Other Opportunities Ev
Slide 9: Acquisition and/or Self-Build Could Contribute to Utility Growth
Acquisition and/or Self-Build Could Contribute to Utility Growth Potential Long-Term Utility Supply Plan Alternatives Capacity Needs ow [@ Acgurerons/cepacty New Generation in Region* ~6 ~9-11 Short Age>35 _ Total Position years Repower existing gas plants Build new generation nuclear plants “Region
Slide 10: Nuclear Opportunities Range from Acquisitions to Business Transformation
Nuclear Opportunities Range from Acquisitions to Business Transformation U.S. Nuclear Market © Small Scale Plants (© .ETR Owned Plants | ETR Contracts x 01-03 Capacity Factors < 90% International Markets Business Development Alternatives Turnaround capability Regulatory / financial pressure could un
Slide 11: Alternative Transaction Structures Create Unique Opportunities
Alternative Transaction Structures Create Unique Opportunities Illustrative Plant (operating Share Acquisition Contract Repurchase EPS > | = . | ‘ Capital = + @ _| 0 Risks Operating Operating (limited) Price Commodity Price or Credit / Performance Credit / Performance 40
Slide 12: M&A Evaluation Is Bounded by Testing Both Strategic Rationale and Timing
M&A Evaluation Is Bounded by Testing Both Strategic Rationale and Timing Mergers and Acquisitions Criteria | Timeless Strategic Financial Ability to Rationale Impact Transact Key Transaction Drivers Example U s/assets that utilize our legacy position to derive Nuclear assets | significant, retainabl
Slide 13: Entergy's POV Led to Exit Decisions
Entergy’s POV Led to Exit Decisions Non-Nuclear Wholesale Assets Portfolio Actions 00-04; MW in U.S. and U.K. Today Energy / Capacity Sold Forward ISES (life of unit) 101-121 RS Cogen (03-06) 185-206 8,511 Others (various terms) 383 Total 669-710 RS Cogen, Crete wand Harrison | Satend (538) ce Creek
Slide 14: Previously Closed Doors in Texas May Open Up New Options in Future
Previously Closed Doors in Texas May Open Up New Options in Future Pursued Single Option Pursuing Multiple Options Past Actions in Texas Post-Legislation Alternatives Vertically integrated (1) Riders regulated utility TX ROA law - Can file immediately to recover transition enacted (99) costs and inc
Slide 15: Investment Opportunities Considered in Risk / Return Framework
Investment Opportunities Considered in Risk / Return Framework Illustrative Typical Range of Acceptable Risk / Return Profiles lear , operat ontracts } Identify more After transform: of these < of portfolio > to a business. = Aequ ie lear Invest only if plants expected Retum Mea? return exceeds eee
Slide 16: Liquidity Is the Enabler
Liquidity Is the Enabler Positive Cash Flow Strong Balance Sheet Cash Available Projected Free Cash Flow 05E-07E: $B Cash Flow from Operating Activities Projected Net Debt Ratio 05E-07E Projected Cash Available 05E-07E; $B Target Range 45-50% - a Dividends Additional F $1.8B 7 Maintenance! Debt Capa
Slide 17: Successful Execution Will Contribute to Achieving Earnings Growth Aspirations
Successful Execution Will Contribute to Achieving Earnings Growth Aspirations As-Reported and Operational Earnings 05 Guidance and Growth Aspirations; $/share and % Long-term 5-6% Lower End Near-term (06) of Range 8-10% ea + —— $4.60 - $4.85 | — Intrinsic Operational Includes: Excellence Utility C S
Slide 18: Summary
Summary Strategy supports long-term value creation Analysis of external factors + rigorous internal processes = Point of View Portfolio management, past and present, guided by disciplined process has created value A range of opportunities exists from asset acquisitions to creative transaction struct
Slide 19: Investing for Growth and Value Creation
Investing for Growth and Value Creation Deutsche Bank 10th Annual Electric Power Conference Leo Denault Executive Vice President aA and Chief Financial Officer = June 14, 2005 Entergy,
Slide 20: Appendix
Appendix 2 intergy
Slide 21: Appendix: Reg G Reconciliations
Appendix: Reg G Reconciliations Table 1: Projected Cash Available for Capital Redeployment 2005 through 2007 - Reconciliation of GAAP to Non-GAAP Measures ($ in billions) 2005-2007 Net cash flow provided by operating activities 7A Less: Net nuclear fuel purchases 04 Decommissioning trust contributio
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