($ in millions, except per share amounts)
Nine Months Nine Months
Ended Sept 30, Ended Sept 30, %
2005 2004 (Restated) Change
Revenue $ 8,113 $ 6,940 17%
Gross Margin $ 2,249 $ 2,076 8%
Income from Continuing
Operations $ 453 $ 231 96%
Net Income $ 453 $ 183 148%
Diluted EPS from Continuing
Operations $ 0.68 $ 0.36 89%
Adjusted Earnings Per Share* $ 0.64 $ 0.49 31%
Net Cash Provided by
Operating Activities $ 1,466 $ 1,117 31%
* Adjusted earnings per share, (a non-GAAP financial measure), excludes from diluted earnings per share from continuing operations the effects of (i) gains or losses from mark-to-market accounting adjustments related to derivatives, (ii) certain foreign currency transaction gains and losses, (iii) significant impacts from net asset disposals or impairments and (iv) early retirement of recourse debt.
Quarterly Financial Highlights
The following table summarizes key financial measures for the second and third quarters of 2005 and for the restated 2004 quarters:
($ in millions except, per share amounts)
Three Three Three Three
Months Months Months Months
Ended Ended Ended Ended
June 30, June 30, Sept. 30, Sept. 30,
2005 2004 % 2005 2004 %
(Restated) Change (Restated) Change
Revenue $2,668 $2,262 18% $2,782 $2,422 15%
Gross Margin $526 $656 -20% $899 $736 22%
Income from
Continuing
Operations $85 $103 -17% $244 $86 184%
Net Income $85 $74 15% $244 $93 162%
Diluted EPS
from Continuing
Operations $0.13 $0.16 -19% $0.37 $0.13 185%
Adjusted
Earnings
Per Share* $0.11 $0.20 -45% $0.35 $0.14 150%
Net Cash
Provided
by Operating
Activities $329 $212 55% $619 $504 23%
THE AES CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited)
Quarter Ended Quarter Ended Nine Months Ended
June 30, September 30, September 30,
($ in
millions,
except
per 2004 2004 2004
share
amounts) 2005 (Restated) 2005 (Restated) 2005 (Restated)
----------------- ---------------- -----------------
Revenues $ 2,668 $ 2,262 $ 2,782 $ 2,422 $ 8,113 $ 6,940
Cost of
sales (2,142) (1,606) (1,883) (1,686) (5,864) (4,864)
------- -------- ------- -------- ------- --------GROSS
MARGIN 526 656 899 736 2,249 2,076
General and
administrative
expenses (45) (42) (49) (40) (143) (130)
------- -------- ------- -------- ------- --------
OPERATING
INCOME 481 614 850 696 2,106 1,946
Interest
expense (475) (470) (450) (478) (1,392) (1,449)
Interest
income 93 70 97 52 280 191
Other
nonoperating
income
(expense),
net 67 1 (11) (11) 41 (24)
Foreign
currency
transaction
losses (1) (47) (22) (22) (54) (103)
Loss on sale
of investments - - - (4) - (5)
Equity in
earnings of
affiliates 21 23 20 18 66 57
------- -------- ------- -------- ------- --------
INCOME BEFORE
INCOME TAXES
AND MINORITY
INTEREST 186 191 484 251 1,047 613
Income tax
expense (82) (17) (143) (128) (372) (220)
Minority
interest
expense,
net (19) (71) (97) (37) (222) (162)
------- -------- ------- -------- ------- --------
INCOME FROM
CONTINUING
OPERATIONS 85 103 244 86 453 231
Loss from
operations of
discontinued
components
(net of income
tax benefit of
$0,$6,$0,$4,$0
and $8,
respectively) - (29) - 7 - (48)
------- -------- ------- -------- ------- --------
INCOME BEFORE
CUMULATIVE
EFFECT OF
ACCOUNTING
CHANGE 85 74 244 93 453 183
Cumulative effect
of accounting
change - - - - - -
------- -------- ------- -------- ------- --------
NET INCOME $ 85 $ 74 $ 244 $ 93 $ 453 $ 183
DILUTED EARNINGS
PER SHARE
Income from
continuing
operations $ 0.13 $ 0.16 $ 0.37 $ 0.13 $ 0.68 $ 0.36
Discontinued
operations - (0.05) - 0.01 - (0.08)
Cumulative effect
of accounting
change - - - - - -
------- -------- ------- -------- ------- --------
Total $ 0.13 $ 0.11 $ 0.37 $ 0.14 $ 0.68 $ 0.28
Diluted weighted
average shares
outstanding
(in millions) 663 645 677 653 664 645
Note: The 2004 periods and nine months ended September 30, 2004
are restated.
THE AES CORPORATION
SEGMENT INFORMATION (unaudited)
Quarter Ended Quarter Ended Nine Months Ended
June 30, September 30, September 30,
($ in
millions) 2004 2004 2004
2005 (Restated) 2005 (Restated) 2005 (Restated)
---------------- ---------------- -----------------
BUSINESS
SEGMENTS
REVENUES
Regulated
Utilities $ 1,395 $ 1,146 $ 1,406 $ 1,251 $ 4,200 $ 3,542
Contract
Generation 988 868 1,046 906 3,019 2,642
Competitive
Supply 285 248 330 265 894 756
---------------- ---------------- -----------------
Total
revenues $ 2,668 $ 2,262 $ 2,782 $ 2,422 $ 8,113 $ 6,940
GROSS MARGIN
Regulated
Utilities $ 114 $ 278 $ 340 $ 301 $ 821 $ 841
Contract
Generation 353 325 453 371 1,198 1,054
Competitive
Supply 59 53 106 64 230 181
---------------- ---------------- -----------------
Total gross
margin $ 526 $ 656 $ 899 $ 736 $ 2,249 $ 2,076
INCOME BEFORE INCOME
TAXES AND MINORITY
INTEREST
Regulated
Utilities $ 87 $ 116 $ 195 $ 168 $ 511 $ 412
Contract
Generation 212 199 348 197 813 580
Competitive
Supply 49 39 86 44 187 140
Corporate (162) (163) (145) (158) (464) (519)
---------------- ---------------- -----------------
Total income
before
income taxes
and minority
interest $ 186 $ 191 $ 484 $ 251 $ 1,047 $ 613
GEOGRAPHIC SEGMENTS
REVENUES
Latin
America $ 1,554 $ 1,217 $ 1,625 $ 1,327 $ 4,693 $ 3,730
North
America 673 630 737 680 2,049 1,936
Europe/Middle
East/Africa
(EMEA) 374 356 360 365 1,158 1,084
Asia 67 59 60 50 213 190
Corporate - - - - - -
---------------- ---------------- -----------------
Total
revenues $ 2,668 $ 2,262 $ 2,782 $ 2,422 $ 8,113 $ 6,940
INCOME BEFORE INCOME
TAXES AND MINORITY
INTEREST
Latin
America $ 130 $ 106 $ 352 $ 159 $ 745 $ 385
North
America 108 133 189 153 424 409
Europe/Middle
East/Africa
(EMEA) 91 95 69 81 277 273
Asia 19 20 19 16 65 65
Corporate (162) (163) (145) (158) (464) (519)
--------------- ---------------- -----------------
Total income
before
income
taxes and
minority
interest $ 186 $ 191 $ 484 $ 251 $ 1,047 $ 613
Note 1: 2004 periods and nine months ended September 30, 2004 are
restated.
Note 2: Business and geographic segments have been changed.
THE AES CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS (unaudited)
June 30, September 30, December 31,
($ in millions) 2005 2005 2004
(Restated)
---------- ------------ -------------
ASSETS
CURRENT ASSETS
Cash and cash
equivalents $ 1,381 $ 1,201 $ 1,281
Restricted cash 408 373 395
Short term
investments 104 234 268
Accounts receivable,
net of reserves of
$340, $320 and
$303, respectively 1,650 1,770 1,575
Inventory 437 479 418
Receivable from
affiliates 5 5 8
Deferred income
taxes - current 348 350 218
Prepaid expenses 111 148 87
Other current
assets 892 846 736
---------- ------------ -------------
Total current assets $ 5,336 $ 5,406 $ 4,986
PROPERTY, PLANT AND EQUIPMENT
Land 850 880 788
Electric generation
and distribution assets 22,367 22,665 21,729
Accumulated depreciation
and amortization (5,783) (6,041) (5,259)
Construction in progress 1,118 1,262 919
---------- ------------ -------------
Property, plant and
equipment, net 18,552 18,766 18,177
OTHER ASSETS
Deferred financing
costs, net 315 318 343
Investment in and
advances to affiliates 695 707 655
Debt service reserves
and other deposits 634 653 737
Goodwill, net 1,454 1,449 1,419
Deferred income
taxes - noncurrent 759 761 774
Other assets 1,635 1,588 1,832
---------- ------------ -------------
Total other assets 5,492 5,476 5,760
---------- ------------ -------------
TOTAL ASSETS $ 29,380 $ 29,648 $ 28,923
LIABILITIES AND STOCKHOLDERS'
EQUITY
CURRENT LIABILITIES
Accounts payable $ 1,094 $ 1,063 $ 1,142
Accrued interest 354 498 335
Accrued and other
liabilities 2,005 2,136 1,656
Recourse
debt-current portion 145 1 142
Non-recourse
debt-current portion 1,771 1,606 1,619
---------- ------------ -------------
Total current liabilities 5,369 5,304 4,894
LONG-TERM LIABILITIES
Non-recourse debt 11,441 11,454 11,817
Recourse debt 4,888 4,885 5,010
Deferred income taxes 772 770 685
Pension liabilities 933 929 891
Other long-term
liabilities 3,319 3,368 3,375
---------- ------------ -------------
Total long-term
liabilities 21,353 21,406 21,778
Minority Interest 1,430 1,517 1,279
STOCKHOLDERS' EQUITY
Common stock 7 7 7
Additional
paid-in capital 6,473 6,484 6,423
Accumulated deficit (1,606) (1,362) (1,815)
Accumulated other
comprehensive loss (3,646) (3,708) (3,643)
---------- ------------ -------------
Total stockholders' equity 1,228 1,421 972
---------- ------------ -------------
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY $ 29,380 $ 29,648 $ 28,923
Note: December 31, 2004 period has been restated.
THE AES CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS(2) (unaudited)
Six Months Ended Nine Months Ended
June 30, September 30,
($ in millions) 2004 2004
2005 (Restated) 2005 (Restated)
------- --------- ------- ---------
OPERATING ACTIVITIES
Net cash provided
by operating
activities 847 613 1,466 1,117
INVESTING ACTIVITIES
Property additions (531) (377) (801) (597)
Acquisitions,
net of cash acquired (85) - (85) -
Proceeds from the
sale of assets 6 36 21 64
Proceeds from the
sale of emission
allowances 29 - 30 -
Sale of short-term
investments 802 727 1,101 911
Purchase of short-term
investments (611) (759) (1,016) (970)
(Increase) decrease
in restricted cash (7) 19 17 (19)
Decrease (increase)
in debt
service reserves
and other assets 73 (28) 88 (13)
Other investing (10) 7 (15) 1
------- --------- ------- ---------
Net cash used
in investing
activities (334) (375) (660) (623)
FINANCING ACTIVITIES
Issuance of
recourse debt 6 491 6 491
Issuance of
non-recourse
debt and other
coupon bearing
securities 951 1,234 1,509 1,489
Repayments of
recourse debt (115) (809) (258) (809)
Repayments of
non-recourse debt
and other coupon
bearing securities (1,248) (1,542) (2,064) (1,756)
Payments for deferred
financing costs (10) (65) (10) (81)
Distributions to
minority interests (47) (54) (126) (82)
Contributions from
minority interests 9 2 9 3
Issuance of
common stock 16 4 20 7
Other financing (2) (2) (4) (3)
------- --------- ------- ---------
Net cash used
in financing
activities (440) (741) (918) (741)
Effect of
exchange rate
changes on cash 27 (28) 32 (12)
------- --------- ------- ---------
Total increase (decrease)
in cash and cash
equivalents 100 (531) (80) (259)
Cash and cash
equivalents,
beginning 1,281 1,663 1,281 1,663
------- --------- ------- ---------
Cash and cash
equivalents,
ending $1,381 $ 1,132 $1,201 $ 1,404
Note 1: June 30, 2004 and September 30, 2004 have been restated.
Note 2: The Company includes components of the cash flows for its
discontinued operations within the Consolidated
Statements of Cash Flows in operating, investing and financing activities
A separate line entitled "Decrease in cash and cash equivalents of discontinued operations and businesses held for sale" was previously presented on the face of the Cash Flow Statement in order to reconcile to the Company's cash balance on the face of the Consolidated Balance Sheets, which excludes cash from discontinued operations. As part of the restatement, the Company has changed its presentation to include the net change in cash balances for discontinued operations as a component of net cash from operating activities. The result of this reclassification increased net cash from operating activities by $4 million, $66 million and $85 million for the years ended December 31, 2004, 2003 and 2002, respectively.
Net cash from operating activities increased $3 million and $8 million for the six months ended June 30, 2004, and nine months ended September 30, 2004, respectively.
THE AES CORPORATION
RECONCILIATION OF ADJUSTED EARNINGS PER SHARE (1) (unaudited)
Quarter Ended Quarter Ended
March 31, June 30,
($ per share) 2004 2004
2005 (Restated) 2005 (Restated)
---------------- ----------------
Adjusted Earnings
Per Share (2) $ 0.18 $ 0.15 $0.11 $ 0.20
FAS 133
Mark-to-Market
Gains/(Losses) (3) - (0.05) (0.01) (0.01)
Currency Transaction
Gains/(Losses) 0.01 (0.02) 0.03 (0.03)
Net Asset
Gains/(Losses
And Impairments) - - - -
Debt Retirement
Gains/(Losses) - (0.01) - -
------ -------- ------ --------
Diluted EPS From
Continuing
Operations (2) $ 0.19 $ 0.07 $0.13 $ 0.16
Quarter Ended Nine Months Ended
September 30, September 30,
($ per share) 2004 2004
2005 (Restated) 2005 (Restated)
---------------- ----------------
Adjusted
Earnings
Per Share (2) $ 0.35 $ 0.14 $0.64 $ 0.49
FAS 133
Mark-to-Market
Gains/(Losses) (3) 0.01 (0.01) (0.01) (0.07)
Currency
Transaction
Gains/(Losses) 0.01 - 0.05 (0.05)
Net Asset
Gains/(Losses
and Impairments) - - - -
Debt Retirement
Gains/(Losses) - - - (0.01)
------ -------- ------ --------
Diluted EPS From
Continuing
Operations (2) $ 0.37 $ 0.13 $0.68 $ 0.36
(1) Adjusted earnings per share (a non-GAAP financial measure) is
defined as diluted earnings per share from continuing
operations excluding gains or losses associated with (a)
mark-to-market amounts related to FAS 133 derivative
transactions, (b) foreign currency transaction impacts on the
net monetary position related to Brazil, Venezuela, and
Argentina, (c) significant asset gains or losses due to
disposition transactions and impairments, and (d) early
retirement of recourse debt. 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
associated with mark-to-market gains or losses related to
certain derivative transactions, currency transaction gains
or losses, periodic strategic decisions to dispose of certain
assets which may fluence results in a given period, and the
early retirement of corporate debt.
(2) The Quarter ended June 30, 2005 and Nine Months Ended
September 30, 2005 includes $(0.06) related to Brazil
receivable reserve costs net of a reversal of a business tax
reserve. The quarter ended September 30, 2005 and nine months
ended September 30, 2005 includes $0.06 related to an
Argentina valuation allowance reversal.
(3) The Nine Months Ended September 30, 2004 includes $(0.03)
related to Chile debt restructuring costs in the first
quarter of 2004.
The AES Corporation
Parent Financial Information
Parent only data:
last four quarters
($ in millions) 4 Quarters Ended
September June March December
30, 30, 31, 31,
2005 2005 2005 2004
Total subsidiary
distributions
& returns of
capital to Parent
-----------------
Actual Actual Actual Actual
--------- ------- ------- --------
Subsidiary
distributions
to Parent $ 920 $ 855 $ 977 $ 991
Net distributions
to/(from) QHCs (1) (4) 8 18 13
--------- ------- ------- --------
Subsidiary distributions 916 863 995 1,004
Returns of capital
distributions to Parent 42 152 115 116
Net returns of
Capital distributions
to/(from) QHCs (1) 13 24 11 11
--------- ------- ------- --------
Returns of capital
distributions 55 176 126 127
Combined distributions
& return of capital received 971 1,039 1,121 1,131
Less: combined net
distributions &
returns of capital
to/(from) QHCs (1) (9) (32) (29) (24)
--------- ------- ------- --------
Total subsidiary
distributions &
returns of capital
to Parent $ 962 $1,007 $1,092 $ 1,107
Parent only data: quarterly
($ in millions) Quarter Ended
September June March December
30, 30, 31, 31,
2005 2005 2005 2004
Total subsidiary
distributions
& returns of
capital to Parent
-----------------
Actual Actual Actual Actual
--------- ------- ------- --------
Subsidiary
distributions
to Parent $ 274 $ 170 $ 190 $ 286
Net distributions
to/(from) QHCs (1) - - 5 (9)
--------- ------- ------- --------
Subsidiary
distributions 274 170 195 277
Returns of
capital
distributions
to Parent - 37 2 3
Net returns
of capital
distributions
to/(from) QHCs (1) - 13 - -
--------- ------- ------- --------
Returns of capital
distributions - 50 2 3
Combined distributions
& return of capital received 274 220 197 280
Less: combined net
distributions &
returns of capital
to/(from) QHCs (1) - (13) (5) 9
--------- ------- ------- --------
Total subsidiary
distributions &
returns of
capital to Parent $ 274 $ 207 $ 192 $ 289
Liquidity (2) Balance at
-------------
($ in millions) September June March December
30, 30, 31, 31,
2005 2005 2005 2004
Actual Actual Actual Actual
--------- ------- ------- --------
Cash at Parent $ 146 $ 145 $ 256 $ 287
Availability under revolver 281 215 218 352
Cash at QHCs (1) 9 19 3 4
--------- ------- ------- --------
Ending liquidity $ 436 $ 379 $ 477 $ 643
(1) The cash held at qualifying holding companies (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 qualifying holding companies is available to the
parent, AES uses the combined measure of subsidiary
distributions to parent and qualified holding companies as a
useful measure of cash available to the parent to meet its
international liquidity needs.
(2) 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.
THE AES CORPORATION
RESTATEMENT SUMMARY (unaudited)
Quarter Ended Year Ended
March 31, December 31,
2005 2004 2003 2002
--------- -------- -------- --------
($ in millions, except per
share amounts)
INCOME STATEMENT EFFECTS
Income (loss) from
Continuing operations
as previously reported $ 133 $ 366 $ 332 $(1,646)
Changes in income (loss)
from continuing operations
from restatement due to:
Increase/(decrease)
in revenues (1) $ 18 $ (23) $ (2) $ (3)
Decrease in cost
of sales (2) $ 24 $ 33 $ 25 $ 21
(Increase) in
interest expense (3) $ - $ (31) $ - $ (48)
(Increase) in goodwill
impairment expense (4) $ - $ - $ - $ (97)
Decrease/(increase) in
foreign currency
transaction
gains/(losses) (5) $ (19) $ (29) $ (31) $ (185)
Decrease/(increase)
in income tax
expense (6) $ (21) $(126) $ (7) $ (168)
Decrease/(increase)
in minority interest
expense (7) $ (15) $ 71 $ (10) $ 55
Other changes affecting
income (loss) from
continuing operations $ 4 $ (3) $ 4 $ 7
-------- -------- -------- --------
Total changes in income
(loss) from continuing
operations $ (9) $(108) $ (21) $ (418)
Income (loss) from
continuing operations
as restated $ 124 $ 258 $ 311 $(2,064)
Diluted earnings (loss)
per share from continuing
operations as previously
reported $ 0.20 $0.57 $0.56 $ (3.06)
Changes due to
restatement
effects (0.01) (0.17) (0.04) (0.77)
-------- -------- -------- --------
Diluted earnings (loss)
per share from continuing
operations as restated $ 0.19 $0.40 $0.52 $ (3.83)
(1) Revenue was impacted by the deferral of revenue at
Eletropaulo and Sul to correctly match the earning of revenue
with the expenditures required by the regulator in relation
to its energy efficiency program. In addition, revenue was
adjusted for the correction of certain acquisition
liabilities related to the Cameroon utility. These
liabilities impacted the initial valuation of the "concession
asset" which represented excess purchase cost over the fair
value of identifiable assets and liabilities. This concession
asset is amortized through revenue.
(2) Depreciation expense was impacted by changes in deferred tax
balances as of the acquisition date of certain subsidiaries.
These deferred tax adjustments in turn affected the amount of
excess purchase cost originally allocated to fixed assets,
thus impacting subsequent depreciation amounts.
(3) Interest expense was impacted primarily by the correct
accounting for changes in inflation on certain Brazilian debt
instruments.
(4) Goodwill impairment expense was impacted by the correction of
acquisition deferred tax balances, which adjusted the
acquired entity's excess fair value over identifiable assets
or liabilities (goodwill). For certain of these
subsidiaries, goodwill subsequent to the acquisition was
impaired and written off in 2002. Therefore the corrections
to the goodwill balances were also written off.
(5) Foreign currency translation gains (losses) were impacted by
the correct remeasurement of deferred tax balances at current
rates at entities where the US dollar is the functional
currency.
(6) Income tax expense was impacted by the creation and
subsequent adjustment of deferred tax assets or liabilities
related to the foreign currency changes on US dollar
denominated debt at certain Brazilian subsidiaries; the
recording of an adjustment related to Sul (a dual tax status
entity) recognizing the tax impact of potential future
foreign income included in the US return; the creation of
additional valuation allowances; and the reconciliation of
deferred tax balances as a result of reconciling tax return
records to related accounting records.
(7) Minority interest (income) expense was impacted by tax and
other corrections to minority owned subsidiaries' earnings.
THE AES CORPORATION
RESTATEMENT SUMMARY (unaudited)
Quarter Ended
December September June March
31, 30, 30, 31,
2004 2004 2004 2004
--------- -------- -------- --------
($ in millions,
except per share
amounts)
INCOME STATEMENT EFFECTS
Income from continuing
operations as previously
reported $ 92 $ 133 $ 67 $ 74
Changes in income from
continuing operations
from restatement due to:
Increase/(decrease)
in revenues $ (20) $ (1) $ (1) $ (1)
Decrease in cost of sales $ 13 $ 6 $ 9 $ 5
(Increase) in
interest expense $ (5) $ (8) $ (10) $ (8)
Decrease/(increase)
in foreign currency
transaction gains/(losses) $ (5) $ (6) $ 8 $ (26)
Decrease/(increase)
in income tax expense $ (107) $ (50) $ 42 $ (11)
Decrease/(increase)
in minority
interest expense $ 59 $ 15 $ (12) $ 9
Other changes
affecting Income
(loss) from continuing
operations $ - $ (3) $ - $ -
--------- -------- -------- --------
Total changes in
income (loss) from
continuing operations $ (65) $ (47) $ 36 $ (32)
Income from continuing
operations as restated $ 27 $ 86 $ 103 $ 42
Diluted earnings per share
from continuing operations
as previously reported $ 0.14 $0.20 $0.10 $ 0.12
Changes due to
restatement effects (0.10) (0.07) 0.06 (0.05)
--------- -------- -------- --------
Diluted earnings per
share from continuing
operations as restated $ 0.04 $0.13 $0.16 $ 0.07
THE AES CORPORATION
RESTATEMENT SUMMARY (unaudited)
As of As of
March 31, December 31,
($ in millions, except per 2005 2004 2003
share amounts) ---------- ---------- -----------
BALANCE SHEET EFFECTS
Total assets as
previously reported $ 29,663 $ 29,732 $ 29,787
Changes in assets from
restatement due to:
Cash & cash equivalents $ (56) $ (127) $ (74)
Short-term investments $ 57 $ 127 $ 75
Deferred income
taxes - current $ 95 $ 31 $ 60
Property, plant
and equipment, net $ (603) $ (611) $ (632)
Deferred financing
costs, net $ (169) $ (170) $ (128)
Goodwill, net $ 38 $ 41 $ 43
Deferred income
taxes - non-current $ (58) $ (39) $ 18
Other changes
in assets, net $ (22) $ (61) $ (12)
---------- ---------- -----------
Total changes in assets $ (718) $ (809) $ (650)
Total assets as restated $ 28,945 $ 28,923 $ 29,137
---------------------------------------
Total liabilities and
stockholders' equity as
previously reported $ 29,663 $ 29,732 $ 29,787
Changes in liabilities and
stockholders' equity from
restatement due to:
Deferred income taxes $ 52 $ - $ (149)
Other long-term liabilities $ 109 $ 114 $ 119
Minority interest $ (311) $ (326) $ (68)
Accumulated deficit $ (1,011) $ (1,002) $ (908)
Accumulated other
Comprehensive loss $ 270 $ 247 $ 293
Other changes in
liabilities and
stockholders' equity, net $ 173 $ 158 $ 63
---------- ---------- -----------
Total changes in liabilities
and stockholders' equity $ (718) $ (809) $ (650)
Total liabilities and
stockholders' equity
as restated $ 28,945 $ 28,923 $ 29,137
THE AES CORPORATION
2005 FINANCIAL GUIDANCE ELEMENTS
Updated Prior
Guidance Guidance
-------------------- -------------------
Income Statement Elements
Revenue Growth 16 - 17% 4%
Gross Margin Change
(As % of Revenues) (1) (75) - (100) b.p. 50 b.p.
Business Segment Income
Before Tax and Minority
Interest(Excludes Corporate
Costs of $650 Million) $2.0 billion $2.0 billion
Allocated by Segment as %
of Total
- Regulated Utilities 38% 45%
- Contract Generation 49% 43%
- Competitive Supply 13% 12%
Adjusted Earnings Per Share
(2) $0.83 $0.83
Adjusted Earnings Per Share
Reconciliation Factors (2) $0.02 ($0.07)
Diluted Earnings Per Share $0.85 $0.76
Cash Flow Elements
Net Cash From
Operating Activities $1.9 to $1.9 to $2.0
$2.0 billion billion
Maintenance Capital $600 - $700 million $700 million
Expenditures
Free Cash Flow (3) $1.2 to $1.3 billion $1.2 to $1.3
billion
Subsidiary Distributions (4) $993 million $1 billion
Parent Debt Repayment (5) $600 million $600 million
in 2005-2006 by early 2006
(1) Based on restated 2004 gross margin of $2.8 billion.
(2) Non-GAAP measure. See Reconciliation of Adjusted Earnings
per Share Note 1.
(3) Non-GAAP measure, defined as net cash from operating
activities less maintenance capital expenditures.
Maintenance capital expenditures reflect property
additions less growth capital expenditures.
(4) Non-GAAP measure.
(5) $254 million in parent debt repaid in 2005.