The
AES Corporation (NYSE: AES) today reported Adjusted Earnings Per
Share (Adjusted EPS, a non-GAAP financial measure) of $0.25 for first
quarter 2015, an increase of $0.01 from first quarter 2014, as the
Company benefited from improved operating performance and from its
capital allocations, which resulted in a 13% reduction in Parent debt
and a 3% lower share count. These positive drivers were largely offset
by the impact of a stronger US Dollar and a slightly higher adjusted
effective tax rate of 33% in 2015, versus 30% in 2014.
First quarter 2015 Diluted Earnings Per Share from Continuing Operations
was $0.20, an increase of $0.27 from first quarter 2014, primarily
driven by losses of $0.30 from impairments and early debt retirement
recorded in the first quarter of 2014, compared to $0.04 recorded in the
first quarter of 2015.
First quarter 2015 Proportional Free Cash Flow (a non-GAAP financial
measure) was $265 million, an increase of $136 million from first
quarter 2014, primarily driven by working capital improvements at the
Company's United States and Brazilian utilities and higher collections
at Maritza in Bulgaria.
"We made significant progress on our priorities for 2015 in the first
quarter. Most notably, we commissioned the 1,240 MW Mong Duong 2 plant
in Vietnam six months early. We also achieved substantial milestones
towards resolving outstanding receivables in Bulgaria and re-securing
coal allocations for our OPGC 2 project under construction in India,"
said Andrés
Gluski, AES President and Chief Executive Officer. "Our $9 billion
construction program remains on track and will be the largest
contributor of our 10% to 15% average annual cash flow growth through
2018. We will continue to use our growing cash flow to maximize total
shareholder returns through dividend growth, share buybacks, debt
reduction and investment in profitable expansion opportunities in our
existing markets."
"We are pleased with our business and financial performance this quarter
and we are reaffirming our guidance ranges for cash flow and Adjusted
EPS, despite a slightly more negative impact than we previously expected
from hydrology in Brazil and foreign currency and commodity forward
curves," said Tom
O'Flynn, AES Executive Vice President and Chief Financial Officer.
"With our recent Parent debt prepayment and refinancing, we have reduced
total maturities between 2015 and 2018 from $840 million to $181
million."
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Table 1: Key Financial Results
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First Quarter
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Full Year 2015
Guidance
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$ in Millions, Except Per Share Amounts
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2015
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2014
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Adjusted EPS1
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$
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0.25
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$
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0.24
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$1.25-$1.35
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Diluted EPS from Continuing Operations
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$
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0.20
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$
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(0.07
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)
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N/A
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Proportional Free Cash Flow1,2
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$
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265
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$
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129
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$1,000-$1,350
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Consolidated Net Cash Provided by Operating Activities
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$
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437
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$
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221
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$1,900-$2,700
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1
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A non-GAAP financial measure. See “Non-GAAP Financial Measures” for
definitions and reconciliations to the most comparable GAAP
financial measures.
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2
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Defined as Proportional Net Cash Provided by Operating Activities,
less Maintenance Capex, which includes non-recoverable environmental
capex. Beginning in Q1 2015, the definition was revised to also
exclude cash flows related to service concession assets.
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Discussion of Operating Drivers of Adjusted Pre-Tax Contribution
(Adjusted PTC, a non-GAAP financial measure) and Adjusted EPS
The Company manages its portfolio in six market-oriented Strategic
Business Units (SBUs): US (United States), Andes (Chile, Colombia and
Argentina), Brazil, MCAC (Mexico, Central America and Caribbean),
Europe, and Asia.
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Table 2: Adjusted PTC1 by SBU and
Adjusted EPS1
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$ in Millions, Except Per Share Amounts
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First Quarter
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2015
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2014
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Variance
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US
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$
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106
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$
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75
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$
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31
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Andes
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91
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53
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38
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Brazil
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21
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69
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(48
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)
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MCAC
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50
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65
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(15
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Europe
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85
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115
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(30
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)
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Asia
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12
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8
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4
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Total SBUs
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$
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365
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$
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385
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$
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(20
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)
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Corp/Other
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(113
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)
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(142
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)
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29
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Total AES Adjusted PTC1,2
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$
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252
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$
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243
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$
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9
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Adjusted Effective Tax Rate
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33
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%
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30
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%
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Diluted Share Count
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706
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727
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Adjusted EPS1
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$
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0.25
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$
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0.24
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$
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0.01
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1
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A non-GAAP financial measure. See “Non-GAAP Financial Measures” for
definitions and reconciliations to the most comparable GAAP
financial measures.
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2
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Includes $14 million and $22 million of after-tax adjusted equity in
earnings for first quarter 2015 and 2014, respectively.
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For the three months ended March 31, 2015, Adjusted EPS increased $0.01,
as improved operating performance contributed $0.01 and the Company's
capital allocation decisions contributed $0.03. These positive drivers
were largely offset by the $0.02 impact of a stronger US Dollar and a
$0.01 impact from a slightly higher adjusted effective tax rate. First
quarter 2015 Adjusted PTC increased $9 million to $252 million. Key
operating drivers of Adjusted PTC included:
-
US: An increase of $31 million, primarily driven by better
availability at DPL as a result of temporary forced outages and a lack
of available gas at a couple of its generation plants in 2014 that did
not recur.
-
Andes: An increase of $38 million, due to better availability
at the Company's coal generation plants in Chile.
-
Brazil: A decrease of $48 million. In addition to the
devaluation of the Brazilian Real, the Company's generation business,
Tiete, purchased energy on the spot market to fulfill its contract.
Additionally, Sul, one of the Company's utilities, decreased due to
lower sales and higher fixed costs.
-
MCAC: A decrease of $15 million, primarily driven by lower
margins in the Dominican Republic, partially offset by improved
hydrology in Panama.
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Europe: A decrease of $30 million, driven by lower
contributions due to the sales of Ebute in Nigeria and the Company's
wind businesses in the United Kingdom, as well as unfavorable foreign
currency exchange rates.
-
Asia: An increase of $4 million. In 2014, the Philippines
market operator retroactively adjusted spot prices for November and
December 2013, resulting in an unfavorable impact of $14 million at
Masinloc in the first quarter of 2014. This was partially offset by
lower contributions from Masinloc, as a result of the sale of 41% of
the business during the third quarter of 2014.
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Corp/Other: An improvement of $29 million, driven by lower
interest expense on Parent debt and lower losses from the Company's
solar joint venture. The Company has sold the majority of its interest
in the solar joint venture.
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Table 3: Proportional Free Cash Flow1
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$ in Millions
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First Quarter
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2015
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2014
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Variance
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US
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$
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155
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$
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81
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$
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74
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Andes
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17
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23
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(6
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)
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Brazil
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(47
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)
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(62
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)
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15
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MCAC
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114
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59
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55
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Europe
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139
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118
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21
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Asia
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4
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41
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(37
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Corp
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(117
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)
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(131
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)
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14
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Total
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$
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265
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$
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129
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$
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136
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1
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A non-GAAP financial measure. See “Non-GAAP Financial Measures” for
definitions and reconciliations to the most comparable GAAP
financial measures.
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First quarter 2015 Proportional Free Cash Flow increased $136 million,
as described above. Key drivers of this improvement included:
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US: An increase of $74 million, primarily driven by recovery of
working capital of $32 million at the Company’s utilities, as well as
higher operating performance.
-
Andes: A decrease of $6 million, primarily driven by timing of
collections and higher maintenance capital expenditures, offset by
better margins due to improved plant availability in Chile.
-
Brazil: An increase of $15 million, primarily driven by
improved working capital of $20 million.
-
MCAC: An increase of $55 million, primarily driven by improved
working capital.
-
Europe: An increase of $21 million, primarily driven by higher
collections of $38 million at Maritza in Bulgaria, partially offset by
lower operating performance.
-
Asia: A decrease of $37 million, primarily related to lower
contributions from Masinloc in the Philippines, as a result of the
sale mentioned above, as well as the contractual time lag between
billing and collections.
-
Corp/Other: An increase of $14 million, primarily driven by
lower general and administrative expenses.
First quarter 2015 Consolidated Net Cash Provided by Operating
Activities increased $216 million to $437 million, primarily driven by
working capital improvements at the Company's United States, Brazil and
Europe SBUs.
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Table 4: 2015 Guidance
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$ in Millions, Except Per Share Amounts
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Full Year 2015 Guidance
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Adjusted EPS1
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$1.25-$1.35
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Proportional Free Cash Flow1
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$1,000-$1,350
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Consolidated Net Cash Provided by Operating Activities
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$1,900-$2,700
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1
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A non-GAAP financial measure. See “Non-GAAP Financial Measures” for
definitions and reconciliations to the most comparable GAAP
financial measures.
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-
The Company's 2015 guidance reflects currency and commodity forward
curves as of March 31, 2015.
-
The Company is reaffirming its Proportional Free Cash Flow guidance
range of $1,000-$1,350 million.
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The Company is reaffirming its Consolidated Net Cash Provided by
Operative Activities guidance range of $1,900-$2,700 million.
-
The Company is reaffirming its Adjusted EPS guidance range of
$1.25-$1.35.
-
The Company's guidance was previously based on currency and
commodity forward curves as of December 31, 2014. The impact on
Adjusted EPS from updating the forward curves for as of March 31,
2015 is $0.05 per share; however, the Company continued to engage
in proactive hedging, bringing this impact down to $0.02 per share.
-
The Company's guidance reflects its updated expectations for the
impact from poor hydrology in Brazil. Although reservoir levels
are in line with the Company's previous expectations, the Company
now expects the Brazilian regulator to dispatch less hydro
capacity in order preserve reservoir levels, causing Tiete to
purchase more energy in the spot market to cover its contracted
position. As a result, the Company is incorporating an additional
$0.02-$0.03 per share impact, bringing the total impact for 2015
to $0.07-$0.08. In 2014, the impact from hydrology in Brazil was
$0.07 per share.
-
The Company's guidance also reflects a $0.01 per share benefit
from the early completion of the 1,240 MW Mong Duong 2 power plant
in Vietnam.
Year-to-Date 2015 Highlights
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The Company has brought on-line 1,312 MW of new projects.
-
In April, the Company achieved commercial operations of its 1,240
MW coal-fired Mong Duong 2 power plant in Vietnam six months
early. Mong Duong 2 has a 25-year Power Purchase Agreement (PPA)
with a state-owned utility.
-
In March, the Company inaugurated the 72 MW fuel oil-fired
Estrella del Mar I power barge in Panama. The project has a 5-year
PPA with a state-owned generation company.
-
The Company currently has 5,819 MW under construction and on track to
come on-line through 2018.
-
Late last year, the Supreme Court of India overturned coal allocations
for 214 projects, including the Company's OPGC 2 project under
construction. In the first quarter of 2015, OPGC 2, through a joint
venture between OPGC and the Government of Odisha, re-secured the
rights to the coal blocks for the project.
-
In April, as previously disclosed, the Company's Maritza plant in
Bulgaria signed a Heads of Terms Agreement with its offtaker, NEK, in
which Maritza agreed to reduce the capacity payment under the
long-term PPA, in exchange for NEK's payment of outstanding
receivables. A binding agreement is expected to be signed by the third
quarter of 2015.
-
The Company announced or closed $563 million in equity proceeds from
asset sales or investments by strategic partners.
-
In 2014, the Company announced an agreement with La Caisse de
depot et placement du Quebec (CDPQ), in which CDPQ would invest
$595 million for direct and indirect interests in IPALCO, the
Parent Company of Indianapolis Power & Light Company.
Year-to-date, AES has received $461 million from CDPQ and expects
to receive the remaining $134 million in 2015-2016.
-
In April, the Company agreed to sell its 101 MW Armenia Mountain
wind project located in Pennsylvania for $75 million.
-
In March, the Company agreed to sell 40% of its interest in the
247 MW IPP4 heavy fuel oil-fired power plant in Jordan for $30
million.
-
The Company prepaid $315 million of near-term Parent debt maturities.
The Company also took advantage of low interest rates and extended its
Parent debt maturity profile by refinancing a significant portion of
its Parent debt with a $575 million bond issuance due in 2025.
-
The Company has repurchased 3.4 million shares for $42 million.
-
Since its fourth quarter 2014 earnings call in February 2015, the
Company has repurchased 1.5 million shares for $19 million.
-
The Company currently has $381 million of share repurchase
authorization outstanding.
-
Since September 2011, the Company has repurchased 84.4 million
shares, or 11% of its shares outstanding, for $1,061 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 2015 Financial
Guidance Elements.
Conference Call Information
AES will host a conference call on Monday, May 11, 2015 at 9:00 a.m.
Eastern Daylight Time (EDT). Interested parties may listen to the
teleconference by dialing 1-877-201-0168 at least ten minutes before the
start of the call. International callers should dial +1-647-788-4901.
The Conference ID for this call is 16970245. Internet access to the
presentation materials will be available on the AES website at www.aes.com by
selecting “Investors”
and then “Presentations
and Webcasts.”
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 18 countries through our
diverse portfolio of distribution businesses as well as thermal and
renewable generation facilities. Our workforce of 18,500 people is
committed to operational excellence and meeting the world’s changing
power needs. Our 2014 revenues were $17 billion and we own and manage
$39 billion in total assets. To learn more, please visit www.aes.com.
Follow AES on Twitter @TheAESCorp.
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’ 2014 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 2014 Annual Report
on Form 10-K dated on or about February 25, 2015 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.
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THE AES CORPORATION
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Condensed Consolidated Statements of Operations (Unaudited)
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Three Months Ended
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March 31,
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2015
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2014
|
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(in millions, except per share amounts)
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Revenue:
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|
|
|
|
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Regulated
|
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$
|
2,080
|
|
|
$
|
2,142
|
|
|
Non-Regulated
|
|
1,904
|
|
|
2,120
|
|
|
Total revenue
|
|
3,984
|
|
|
4,262
|
|
|
Cost of Sales:
|
|
|
|
|
|
Regulated
|
|
(1,807
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)
|
|
(1,932
|
)
|
|
Non-Regulated
|
|
(1,456
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)
|
|
(1,536
|
)
|
|
Total cost of sales
|
|
(3,263
|
)
|
|
(3,468
|
)
|
|
Operating margin
|
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721
|
|
|
794
|
|
|
General and administrative expenses
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|
(55
|
)
|
|
(51
|
)
|
|
Interest expense
|
|
(363
|
)
|
|
(373
|
)
|
|
Interest income
|
|
90
|
|
|
63
|
|
|
Loss on extinguishment of debt
|
|
(23
|
)
|
|
(134
|
)
|
|
Other expense
|
|
(20
|
)
|
|
(8
|
)
|
|
Other income
|
|
16
|
|
|
12
|
|
|
Goodwill impairment expense
|
|
—
|
|
|
(154
|
)
|
|
Asset impairment expense
|
|
(8
|
)
|
|
(12
|
)
|
|
Foreign currency transaction losses
|
|
(23
|
)
|
|
(19
|
)
|
|
INCOME FROM CONTINUING OPERATIONS BEFORE TAXES AND EQUITY IN
EARNINGS OF AFFILIATES
|
|
335
|
|
|
118
|
|
|
Income tax expense
|
|
(96
|
)
|
|
(54
|
)
|
|
Net equity in earnings of affiliates
|
|
15
|
|
|
25
|
|
|
INCOME FROM CONTINUING OPERATIONS
|
|
254
|
|
|
89
|
|
|
Income from operations of discontinued businesses, net of income tax
expense of $0 and $14, respectively
|
|
—
|
|
|
20
|
|
|
Net loss from disposal and impairments of discontinued businesses,
net of income tax expense (benefit) of $0 and $(1), respectively
|
|
—
|
|
|
(43
|
)
|
|
NET INCOME
|
|
254
|
|
|
66
|
|
|
Noncontrolling interests:
|
|
|
|
|
|
Less: Income from continuing operations attributable to
noncontrolling interests
|
|
(112
|
)
|
|
(136
|
)
|
|
Plus: Loss from discontinued operations attributable to
noncontrolling interests
|
|
—
|
|
|
12
|
|
|
Total net income attributable to noncontrolling interests
|
|
(112
|
)
|
|
(124
|
)
|
|
NET INCOME (LOSS) ATTRIBUTABLE TO THE AES CORPORATION
|
|
$
|
142
|
|
|
$
|
(58
|
)
|
|
AMOUNTS ATTRIBUTABLE TO THE AES CORPORATION COMMON STOCKHOLDERS:
|
|
|
|
|
|
Income (loss) from continuing operations, net of tax
|
|
$
|
142
|
|
|
$
|
(47
|
)
|
|
Loss from discontinued operations, net of tax
|
|
—
|
|
|
(11
|
)
|
|
Net income (loss)
|
|
$
|
142
|
|
|
$
|
(58
|
)
|
|
BASIC EARNINGS PER SHARE:
|
|
|
|
|
|
Income (loss) from continuing operations attributable to The AES
Corporation common stockholders, net of tax
|
|
$
|
0.20
|
|
|
$
|
(0.07
|
)
|
|
Loss from discontinued operations attributable to The AES
Corporation common stockholders, net of tax
|
|
—
|
|
|
(0.01
|
)
|
|
NET INCOME (LOSS) ATTRIBUTABLE TO THE AES CORPORATION COMMON
STOCKHOLDERS
|
|
$
|
0.20
|
|
|
$
|
(0.08
|
)
|
|
DILUTED EARNINGS PER SHARE:
|
|
|
|
|
|
Income (loss) from continuing operations attributable to The AES
Corporation common stockholders, net of tax
|
|
$
|
0.20
|
|
|
$
|
(0.07
|
)
|
|
Loss from discontinued operations attributable to The AES
Corporation common stockholders, net of tax
|
|
—
|
|
|
(0.01
|
)
|
|
NET INCOME (LOSS) ATTRIBUTABLE TO THE AES CORPORATION COMMON
STOCKHOLDERS
|
|
$
|
0.20
|
|
|
$
|
(0.08
|
)
|
|
DILUTED SHARES OUTSTANDING
|
|
706
|
|
|
724
|
|
|
DIVIDENDS DECLARED PER COMMON SHARE
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
THE AES CORPORATION
|
|
Strategic Business Unit (SBU) Information
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
|
March 31,
|
|
|
|
2015
|
|
2014
|
|
|
|
(in millions)
|
|
REVENUE
|
|
|
|
|
|
US
|
|
$
|
997
|
|
|
$
|
1,001
|
|
|
Andes
|
|
612
|
|
|
620
|
|
|
Brazil
|
|
1,330
|
|
|
1,445
|
|
|
MCAC
|
|
598
|
|
|
638
|
|
|
Europe
|
|
330
|
|
|
391
|
|
|
Asia
|
|
119
|
|
|
168
|
|
|
Corporate, Other and Inter-SBU eliminations
|
|
(2
|
)
|
|
(1
|
)
|
|
|
|
|
|
|
|
Total Revenue
|
|
$
|
3,984
|
|
|
$
|
4,262
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
THE AES CORPORATION
|
|
Condensed Consolidated Balance Sheets (Unaudited)
|
|
|
|
|
|
|
|
|
|
March 31,
|
|
December 31,
|
|
|
|
2015
|
|
2014
|
|
|
|
(in millions, except share and per share data)
|
|
ASSETS
|
|
|
|
|
|
CURRENT ASSETS
|
|
|
|
|
|
Cash and cash equivalents
|
|
$
|
1,337
|
|
|
$
|
1,539
|
|
|
Restricted cash
|
|
318
|
|
|
283
|
|
|
Short-term investments
|
|
582
|
|
|
709
|
|
|
Accounts receivable, net of allowance for doubtful accounts of $83
and $96, respectively
|
|
2,807
|
|
|
2,709
|
|
|
Inventory
|
|
707
|
|
|
702
|
|
|
Deferred income taxes
|
|
173
|
|
|
275
|
|
|
Prepaid expenses
|
|
129
|
|
|
175
|
|
|
Other current assets
|
|
1,562
|
|
|
1,434
|
|
|
Current assets of held-for-sale businesses
|
|
27
|
|
|
—
|
|
|
Total current assets
|
|
7,642
|
|
|
7,826
|
|
|
NONCURRENT ASSETS
|
|
|
|
|
|
Property, Plant and Equipment:
|
|
|
|
|
|
Land
|
|
780
|
|
|
870
|
|
|
Electric generation, distribution assets and other
|
|
29,377
|
|
|
30,459
|
|
|
Accumulated depreciation
|
|
(9,652
|
)
|
|
(9,962
|
)
|
|
Construction in progress
|
|
2,343
|
|
|
3,784
|
|
|
Property, plant and equipment, net
|
|
22,848
|
|
|
25,151
|
|
|
Other Assets:
|
|
|
|
|
|
Investments in and advances to affiliates
|
|
586
|
|
|
537
|
|
|
Debt service reserves and other deposits
|
|
406
|
|
|
411
|
|
|
Goodwill
|
|
1,465
|
|
|
1,458
|
|
|
Other intangible assets, net of accumulated amortization of $121 and
$158, respectively
|
|
261
|
|
|
281
|
|
|
Deferred income taxes
|
|
597
|
|
|
662
|
|
|
Service concession assets
|
|
1,520
|
|
|
—
|
|
|
Other noncurrent assets
|
|
2,520
|
|
|
2,640
|
|
|
Noncurrent assets of held-for-sale businesses
|
|
152
|
|
|
—
|
|
|
Total other assets
|
|
7,507
|
|
|
5,989
|
|
|
TOTAL ASSETS
|
|
$
|
37,997
|
|
|
$
|
38,966
|
|
|
LIABILITIES AND EQUITY
|
|
|
|
|
|
CURRENT LIABILITIES
|
|
|
|
|
|
Accounts payable
|
|
$
|
2,051
|
|
|
$
|
2,278
|
|
|
Accrued interest
|
|
346
|
|
|
260
|
|
|
Accrued and other liabilities
|
|
2,345
|
|
|
2,326
|
|
|
Non-recourse debt, including $215 and $240, respectively, related to
variable interest entities
|
|
1,831
|
|
|
1,982
|
|
|
Recourse debt
|
|
—
|
|
|
151
|
|
|
Current liabilities of held-for-sale businesses
|
|
9
|
|
|
—
|
|
|
Total current liabilities
|
|
6,582
|
|
|
6,997
|
|
|
NONCURRENT LIABILITIES
|
|
|
|
|
|
Non-recourse debt, including $1,062 and $1,030, respectively,
related to variable interest entities
|
|
13,625
|
|
|
13,618
|
|
|
Recourse debt
|
|
4,945
|
|
|
5,107
|
|
|
Deferred income taxes
|
|
1,223
|
|
|
1,277
|
|
|
Pension and other post-retirement liabilities
|
|
1,142
|
|
|
1,342
|
|
|
Other noncurrent liabilities
|
|
3,060
|
|
|
3,222
|
|
|
Noncurrent liabilities of held-for-sale businesses
|
|
62
|
|
|
—
|
|
|
Total noncurrent liabilities
|
|
24,057
|
|
|
24,566
|
|
|
Contingencies and Commitments (see Note 9)
|
|
|
|
|
|
Redeemable stock of subsidiaries
|
|
323
|
|
|
78
|
|
|
EQUITY
|
|
|
|
|
|
THE AES CORPORATION STOCKHOLDERS’ EQUITY
|
|
|
|
|
|
Common stock ($0.01 par value, 1,200,000,000 shares authorized;
815,087,569 issued and 702,899,220 outstanding at March 31, 2015 and
814,539,146 issued and 703,851,297 outstanding at December 31, 2014)
|
|
8
|
|
|
8
|
|
|
Additional paid-in capital
|
|
8,530
|
|
|
8,409
|
|
|
Retained earnings
|
|
423
|
|
|
512
|
|
|
Accumulated other comprehensive loss
|
|
(3,549
|
)
|
|
(3,286
|
)
|
|
Treasury stock, at cost (112,188,349 shares at March 31, 2015 and
110,687,849 shares at December 31, 2014)
|
|
(1,390
|
)
|
|
(1,371
|
)
|
|
Total AES Corporation stockholders’ equity
|
|
4,022
|
|
|
4,272
|
|
|
NONCONTROLLING INTERESTS
|
|
3,013
|
|
|
3,053
|
|
|
Total equity
|
|
7,035
|
|
|
7,325
|
|
|
TOTAL LIABILITIES AND EQUITY
|
|
$
|
37,997
|
|
|
$
|
38,966
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
THE AES CORPORATION
|
|
Condensed Consolidated Statements of Cash Flows
|
|
(Unaudited)
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
|
March 31,
|
|
|
|
2015
|
|
2014
|
|
|
|
(in millions)
|
|
OPERATING ACTIVITIES:
|
|
|
|
|
|
Net income
|
|
$
|
254
|
|
|
$
|
66
|
|
|
Adjustments to net income:
|
|
|
|
|
|
Depreciation and amortization
|
|
298
|
|
|
306
|
|
|
Impairment expenses
|
|
8
|
|
|
166
|
|
|
Deferred income taxes
|
|
(12
|
)
|
|
56
|
|
|
Provisions for contingencies
|
|
14
|
|
|
12
|
|
|
Loss on the extinguishment of debt
|
|
23
|
|
|
134
|
|
|
Loss on disposal of assets
|
|
10
|
|
|
3
|
|
|
Loss on disposals and impairments — discontinued operations
|
|
—
|
|
|
44
|
|
|
Other
|
|
54
|
|
|
36
|
|
|
Changes in operating assets and liabilities
|
|
|
|
|
|
(Increase) decrease in accounts receivable
|
|
(337
|
)
|
|
(219
|
)
|
|
(Increase) decrease in inventory
|
|
(35
|
)
|
|
(12
|
)
|
|
(Increase) decrease in prepaid expenses and other current assets
|
|
68
|
|
|
(74
|
)
|
|
(Increase) decrease in other assets
|
|
(290
|
)
|
|
(444
|
)
|
|
Increase (decrease) in accounts payable and other current liabilities
|
|
273
|
|
|
415
|
|
|
Increase (decrease) in income tax payables, net and other tax
payables
|
|
(15
|
)
|
|
(206
|
)
|
|
Increase (decrease) in other liabilities
|
|
124
|
|
|
(62
|
)
|
|
Net cash provided by operating activities
|
|
437
|
|
|
221
|
|
|
INVESTING ACTIVITIES:
|
|
|
|
|
|
Capital Expenditures
|
|
(619
|
)
|
|
(399
|
)
|
|
Acquisitions, net of cash acquired
|
|
(17
|
)
|
|
—
|
|
|
Proceeds from the sale of businesses, net of cash sold
|
|
—
|
|
|
29
|
|
|
Sale of short-term investments
|
|
1,076
|
|
|
1,049
|
|
|
Purchase of short-term investments
|
|
(1,054
|
)
|
|
(993
|
)
|
|
Increase in restricted cash, debt service reserves and other assets
|
|
(75
|
)
|
|
(19
|
)
|
|
Other investing
|
|
(31
|
)
|
|
7
|
|
|
Net cash used in investing activities
|
|
(720
|
)
|
|
(326
|
)
|
|
FINANCING ACTIVITIES:
|
|
|
|
|
|
Borrowings under the revolving credit facilities
|
|
101
|
|
|
217
|
|
|
Issuance of recourse debt
|
|
—
|
|
|
750
|
|
|
Issuance of non-recourse debt
|
|
574
|
|
|
554
|
|
|
Repayments under the revolving credit facilities
|
|
(62
|
)
|
|
(152
|
)
|
|
Repayments of recourse debt
|
|
(336
|
)
|
|
(866
|
)
|
|
Repayments of non-recourse debt
|
|
(269
|
)
|
|
(349
|
)
|
|
Payments for financing fees
|
|
(9
|
)
|
|
(78
|
)
|
|
Distributions to noncontrolling interests
|
|
(19
|
)
|
|
(26
|
)
|
|
Contributions from noncontrolling interests
|
|
67
|
|
|
32
|
|
|
Proceeds from the sale of redeemable stock of subsidiaries
|
|
247
|
|
|
—
|
|
|
Dividends paid on AES common stock
|
|
(70
|
)
|
|
(36
|
)
|
|
Payments for financed capital expenditures
|
|
(42
|
)
|
|
(178
|
)
|
|
Purchase of treasury stock
|
|
(35
|
)
|
|
—
|
|
|
Other financing
|
|
(34
|
)
|
|
—
|
|
|
Net cash provided by (used in) financing activities
|
|
113
|
|
|
(132
|
)
|
|
Effect of exchange rate changes on cash
|
|
(27
|
)
|
|
(22
|
)
|
|
Increase (decrease) in cash of held-for-sale businesses
|
|
(5
|
)
|
|
30
|
|
|
Total decrease in cash and cash equivalents
|
|
(202
|
)
|
|
(229
|
)
|
|
Cash and cash equivalents, beginning
|
|
1,539
|
|
|
1,642
|
|
|
Cash and cash equivalents, ending
|
|
$
|
1,337
|
|
|
$
|
1,413
|
|
|
SUPPLEMENTAL DISCLOSURES:
|
|
|
|
|
|
Cash payments for interest, net of amounts capitalized
|
|
$
|
242
|
|
|
$
|
226
|
|
|
Cash payments for income taxes, net of refunds
|
|
$
|
103
|
|
|
$
|
237
|
|
|
|
|
|
|
|
|
SCHEDULE OF NONCASH INVESTING AND FINANCING ACTIVITIES:
|
|
|
|
|
|
Assets acquired through capital lease
|
|
$
|
5
|
|
|
$
|
11
|
|
|
|
|
|
|
|
|
|
|
|
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 adjusted for the same gains or losses excluded
from consolidated entities.
We define adjusted EPS as diluted earnings per share from continuing
operations excluding gains or losses of both consolidated entities and
entities accounted for under the equity method 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 31, 2015
|
|
March 31, 2014
|
|
|
|
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)
|
|
Income (loss) from continuing operations attributable to AES and
Diluted EPS
|
|
$
|
142
|
|
|
$
|
0.20
|
|
|
|
|
$
|
(47
|
)
|
|
$
|
(0.07
|
)
|
|
|
|
Add back income tax expense (benefit) from continuing operations
attributable to AES
|
|
50
|
|
|
|
|
|
|
(25
|
)
|
|
|
|
|
|
Pre-tax contribution
|
|
$
|
192
|
|
|
|
|
|
|
$
|
(72
|
)
|
|
|
|
|
|
Adjustments
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Unrealized derivative (gains)/ losses(2)
|
|
$
|
(15
|
)
|
|
$
|
(0.01
|
)
|
|
|
|
$
|
(10
|
)
|
|
$
|
(0.01
|
)
|
|
|
|
Unrealized foreign currency transaction (gains)/ losses(3)
|
|
47
|
|
|
0.03
|
|
|
|
|
26
|
|
|
0.02
|
|
|
|
|
Disposition/ acquisition (gains)/ losses
|
|
(5
|
)
|
|
(0.01
|
)
|
|
|
|
(1
|
)
|
|
—
|
|
|
|
|
Impairment losses
|
|
6
|
|
|
0.01
|
|
|
|
|
166
|
|
|
0.17
|
|
|
(4)
|
|
Loss on extinguishment of debt
|
|
27
|
|
|
0.03
|
|
|
(5)
|
|
134
|
|
|
0.13
|
|
|
(6)
|
|
Adjusted PTC and Adjusted EPS
|
|
$
|
252
|
|
|
$
|
0.25
|
|
|
|
|
$
|
243
|
|
|
$
|
0.24
|
|
|
|
|
_____________________________
|
|
(1)
|
|
NCI is defined as Noncontrolling Interests.
|
|
(2)
|
|
Unrealized derivative (gains) losses were net of income tax per
share of $(0.01) and $(0.01) in the three months ended March 31,
2015 and 2014, respectively.
|
|
(3)
|
|
Unrealized foreign currency transaction (gains) losses were net of
income tax per share of $0.03 and $0.01 in the three months ended
March 31, 2015 and 2014, respectively.
|
|
(4)
|
|
Amount primarily relates to the goodwill impairments at DPLER 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 $12 million ($8 million, or $0.01 per share, net
of income tax per share of $0.00).
|
|
(5)
|
|
Amount primarily relates to the loss on early retirement of debt at
the Parent Company of $26 million ($18 million, or $0.03 per share,
net of income tax per share of $0.01).
|
|
(6)
|
|
Amount primarily relates to the loss on early retirement of debt at
the Parent Company of $132 million ($91 million, or $0.13 per share,
net of income tax per share of $0.06).
|
|
|
|
|
|
|
|
|
|
THE AES CORPORATION
|
|
|
|
NON-GAAP FINANCIAL MEASURES
|
|
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
|
March 31,
|
|
|
|
2015
|
|
2014
|
|
|
|
(in millions)
|
|
Calculation of Maintenance Capital Expenditures for Free Cash
Flow (1) Reconciliation Below:
|
|
|
|
|
|
|
|
Maintenance Capital Expenditures
|
|
$
|
149
|
|
|
$
|
137
|
|
|
Environmental Capital Expenditures
|
|
48
|
|
|
33
|
|
|
Growth Capital Expenditures
|
|
464
|
|
|
407
|
|
|
Total Capital Expenditures
|
|
$
|
661
|
|
|
$
|
577
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of Proportional Operating Cash Flow(2)
|
|
|
|
|
|
Consolidated Operating Cash Flow
|
|
$
|
437
|
|
|
$
|
221
|
|
|
Add: capital expenditures related to service concession assets (4)
|
|
20
|
|
|
0
|
|
|
Less: Proportional Adjustment Factor (3)
|
|
(72
|
)
|
|
20
|
|
|
Proportional Operating Cash Flow (2)
|
|
$
|
385
|
|
|
$
|
241
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of Free Cash Flow(1)
|
|
|
|
|
|
|
|
Consolidated Operating Cash Flow
|
|
$
|
437
|
|
|
$
|
221
|
|
|
Less: Maintenance Capital Expenditures, net of reinsurance proceeds
|
|
(149
|
)
|
|
(137
|
)
|
|
Less: Non-Recoverable Environmental Capital Expenditures
|
|
(9
|
)
|
|
(11
|
)
|
|
Free Cash Flow(1)
|
|
$
|
279
|
|
|
$
|
73
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of Proportional Free Cash Flow(1),(2)
|
|
|
|
|
|
|
|
Proportional Operating Cash Flow
|
|
$
|
385
|
|
|
$
|
241
|
|
|
Less: Proportional Maintenance Capital Expenditures, net of
reinsurance proceeds (3)
|
|
(113
|
)
|
|
(104
|
)
|
|
Less: Proportional Non-Recoverable Environmental Capital
Expenditures (3) (5)
|
|
(7
|
)
|
|
(8
|
)
|
|
Proportional Free Cash Flow(1),(2)
|
|
$
|
265
|
|
|
$
|
129
|
|
|
|
|
|
|
(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. Beginning in Q1 2015, the definition was revised to also
exclude cash flows related to service concession assets.
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)
|
|
The proportional adjustment factor, proportional maintenance capital
expenditures (net of reinsurance proceeds), and proportional
non-recoverable environmental capital expenditures are calculated by
multiplying the percentage owned by non-controlling interests for
each entity by its corresponding consolidated cash flow metric and
adding up the resulting figures. For example, the Company owns
approximately 71% of AES Gener, its subsidiary in Chile. Assuming a
consolidated net cash flow from operating activities of $100 from
AES Gener, the proportional adjustment factor for AES Gener would
equal approximately $29 (or $100 x 29%). The Company calculates the
proportional adjustment factor for each consolidated business in
this manner and then adds these amounts together to determine the
total proportional adjustment factor used in the reconciliation. The
proportional adjustment factor may differ from the proportion of
income attributable to noncontrolling interests as a result of (a)
non-cash items which impact income but not cash and (b) AES’
ownership interest in the subsidiary where such items occur.
|
|
|
|
|
|
(4)
|
|
Service concession asset expenditures excluded from proportional
free cash flow non-GAAP metric.
|
|
|
|
|
|
(5)
|
|
Excludes IPALCO’s proportional recoverable environmental capital
expenditures of $39 million and $23 million for the three months
March 31, 2015 and March 31, 2014, respectively.
|
|
|
|
|
|
|
|
|
|
|
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, 2015
|
|
December 31, 2014
|
|
September 30, 2014
|
|
June 30, 2014
|
|
|
Actual
|
|
Actual
|
|
Actual
|
|
Actual
|
|
Subsidiary distributions(1) to Parent & QHCs
|
|
$
|
1,094
|
|
$
|
1,151
|
|
$
|
1,139
|
|
$
|
1,192
|
|
Returns of capital distributions to Parent & QHCs
|
|
75
|
|
85
|
|
96
|
|
65
|
|
Total subsidiary distributions & returns of capital to Parent
|
|
$
|
1,169
|
|
$
|
1,236
|
|
$
|
1,235
|
|
$
|
1,257
|
|
Parent only data: quarterly
|
|
|
|
|
|
|
|
|
|
($ in millions)
|
|
Quarter Ended
|
|
Total subsidiary distributions & returns
of capital to Parent
|
|
March 31, 2015
|
|
December 31, 2014
|
|
September 30, 2014
|
|
June 30, 2014
|
|
|
Actual
|
|
Actual
|
|
Actual
|
|
Actual
|
|
Subsidiary distributions to Parent & QHCs
|
|
$
|
175
|
|
$
|
414
|
|
$
|
295
|
|
$
|
210
|
|
Returns of capital distributions to Parent & QHCs
|
|
0
|
|
18
|
|
31
|
|
26
|
|
Total subsidiary distributions & returns of capital to Parent
|
|
$
|
175
|
|
$
|
432
|
|
$
|
326
|
|
$
|
236
|
|
Parent Company Liquidity (2)
|
|
|
|
|
|
|
($ in millions)
|
|
Balance at
|
|
|
|
March 31, 2015
|
|
December 31, 2014
|
|
September 30, 2014
|
|
June 30, 2014
|
|
|
|
Actual
|
|
Actual
|
|
Actual
|
|
Actual
|
|
Cash at Parent & Cash at QHCs (3)
|
|
$
|
292
|
|
$
|
507
|
|
$
|
229
|
|
$
|
15
|
|
Availability under credit facilities
|
|
739
|
|
739
|
|
799
|
|
679
|
|
Ending liquidity
|
|
$
|
1,031
|
|
$
|
1,246
|
|
$
|
1028
|
|
$
|
694
|
|
|
|
|
|
(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
|
|
2015 FINANCIAL GUIDANCE ELEMENTS(1), (2)
|
|
|
|
|
|
|
|
2015 Financial Guidance
|
|
|
|
As of 5/11/15
|
|
|
|
Consolidated
|
|
Proportional
|
|
Income Statement Guidance
|
|
|
|
|
|
Adjusted Earnings Per Share (3)
|
|
$1.25-$1.35
|
|
|
|
Cash Flow Guidance
|
|
|
|
|
|
Net Cash Provided by Operating Activities
|
|
$1,900-$2,700 million
|
|
|
|
Free Cash Flow (4)
|
|
|
|
$1,000-$1,350 million
|
|
Reconciliation of Free Cash Flow Guidance
|
|
|
|
|
|
Net Cash from Operating Activities
|
|
$1,900-$2,700 million
|
|
$1,600-$1,950 million
|
|
Less: Maintenance Capital Expenditures
|
|
$650-$950 million
|
|
$450-$750 million
|
|
Free Cash Flow (4)
|
|
$1,100-$1,900 million
|
|
$1,000-$1,350 million
|
|
|
|
|
|
(1)
|
|
2015 Guidance is based on expectations for future foreign exchange
rates and commodity prices as of March 31, 2015.
|
|
|
|
|
|
(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.
|
|
|
|
|
Copyright Business Wire 2015