RRI Energy Reports First Quarter 2009 Results
-
Board of Directors successfully concludes formal review of strategic
alternatives, resulting in sale of retail business
-
Following completion of the sale of retail business, company name
changed to RRI Energy, Inc.
-
Generation assets performing at top quartile operating levels despite
reduction in commodity prices
-
Current pro forma liquidity of $2.1 billion with $1.6 billion of cash
- Press Release
- Source: RRI Energy, Inc.
- On 7:00 am EDT, Monday May 11, 2009
HOUSTON--(BUSINESS WIRE)--RRI Energy, Inc. today is reporting open EBITDA of $5 million for the first quarter of 2009, compared to $120 million for the same period of 2008. Adjusted EBITDA was $19 million for the first quarter of 2009, compared to $157 million for the first quarter of 2008. Free cash flow provided by continuing operations was $46 million for the first three months of 2009, compared to $151 million for the same period in 2008. The declines were primarily due to lower unit margins by generating stations resulting from lower commodity prices. These results exclude the performance of the Texas retail business, which was sold on May 1, 2009 and is included in discontinued operations.
“The strategic alternatives process, which has concluded, resulted in the sale of the retail business,” said Mark Jacobs, president and chief executive officer of RRI Energy. “Completed on May 1, the sale was pivotal in creating the company we are today - a well-capitalized merchant generator, positioned to deliver value to our shareholders.”
“Going forward, RRI Energy is focused on managing the risks associated with the current market economy and addressing long term industry challenges,” said Jacobs.
The loss from continuing operations before income taxes for the first quarter of 2009 was $140 million, compared to income of $24 million for the first quarter of 2008. The 2009 reported results include net unrealized losses from energy derivatives of $44 million. The reported numbers for the first quarter of 2008 include net unrealized gains from energy derivatives of $30 million and a $34 million charge for western states litigation and similar settlements. Operating cash flow from continuing operations was $199 million for the first quarter of 2009, compared to $207 million for the same period of 2008. These results exclude the performance of the Texas retail business which was sold on May 1, 2009 and is included in discontinued operations.
Outlook
RRI Energy’s outlook is based on forward commodity prices as of March 27, 2009. The outlook for open EBITDA is $313 million and $435 million for the years ending December 31, 2009 and 2010, respectively. The outlook for adjusted EBITDA, which includes the impact of wholesale hedges and gains on sales of assets and emission and exchange allowances, net is $223 million and $432 million for the same periods. The outlook for free cash flow provided by (used in) continuing operations is ($182) million and $170 million for the years ending December 31, 2009 and 2010, respectively.
|
Open EBITDA Reconciliation1 |
||||||||||||
| ($ millions) |
2008A |
2009E |
2010E |
|||||||||
| Income (loss) from continuing operations before income taxes | $ | 26 | ($235 | ) | ($63 | ) | ||||||
| Unrealized (gains) losses on energy derivatives | 9 | (15 | ) | 23 | ||||||||
| Western states litigation and similar settlements | 37 | --- | --- | |||||||||
| Wholesale energy goodwill impairment | 305 | --- | --- | |||||||||
| Debt extinguishments | 1 | --- | --- | |||||||||
| Depreciation and amortization | 313 | 292 | 292 | |||||||||
| Interest expense, net | 180 | 181 | 180 | |||||||||
| Adjusted EBITDA | $ | 871 | $ | 223 | $ | 432 | ||||||
| Wholesale hedges | (239 | ) | 109 | 3 | ||||||||
| Gains on sales of assets and emission and exchange allowances, net | (93 | ) | (19 | ) | --- | |||||||
| Open EBITDA | $ | 539 | $ | 313 | $ | 435 | ||||||
|
1. Excludes retail energy segment. |
||||||||||||
|
Free Cash Flow from Continuing Operations Reconciliation1 |
||||||||||||
| ($ millions) |
2008A |
2009E |
2010E |
|||||||||
| Operating cash flow from continuing operations | $ | 424 | $ | 136 | $ | 311 | ||||||
| Western states litigation and similar settlements payments | 34 | 65 | --- | |||||||||
| Change in margin deposits, net | 93 | (169 | ) | (28 | ) | |||||||
| Adjusted cash flow provided by continuing operations | $ | 551 | $ | 32 | $ | 283 | ||||||
| Maintenance capital expenditures | (56 | ) | (45 | ) | (63 | ) | ||||||
| Environmental capital expenditures and capitalized interest2 | (223 | ) | (156 | ) | (29 | ) | ||||||
| Emission and exchange allowances activity, net | (19 | ) | (13 | ) | (21 | ) | ||||||
| Free cash flow provided by (used in) continuing operations | $ | 253 | ($182 | ) | $ | 170 | ||||||
|
1. Excludes retail energy segment. |
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|
2. Estimate represents the low end of the range. |
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Non-GAAP Financial Measures
This press release and the attached financial tables include the following non-GAAP financial measures:
- Open energy gross margin
- Open wholesale gross margin
- Open wholesale contribution margin
- EBITDA
- Adjusted EBITDA
- Open EBITDA
- Adjusted cash flow provided by continuing operations
- Free cash flow provided by (used in) continuing operations
- Gross debt
- Net debt
A reconciliation of these financial measures and the most directly comparable GAAP measures is included above or in the attached financial tables. Additional information regarding these measures, including a discussion of their usefulness and purpose, is included in the Form 8-K furnished along with this press release. Certain factors that could affect GAAP financial measures are not accessible on a forward-looking basis, but could be material to future reported earnings and cash flows.
Webcast Of Earnings Conference Call
RRI Energy will host its first quarter 2009 earnings conference call beginning at 7:30 a.m. Central Time on Monday, May 11, 2009. The conference call will be webcast live with audio and slides at www.rrienergy.com in the investors section. A replay of the call can be accessed approximately two hours after the call’s completion .
About RRI Energy, Inc.
RRI Energy, Inc. (NYSE:RRI - News) based in Houston, provides electricity to wholesale customers in the United States. The company is one of the largest independent power producers in the nation with more than 14,000 megawatts of power generation capacity across the United States. These strategically located generating assets use natural gas, fuel oil and coal. RRI will routinely post all important information on its Web site at www.rrienergy.com.
This news release contains "forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements are statements that contain projections, estimates or assumptions about the outcome of pending legal actions, our revenues, margins, capital structure and other financial items, and our plans and objectives for future operations or about our future economic performance, transactions, dispositions, financings or offerings. In many cases you can identify forward-looking statements by terminology such as "anticipate," "estimate," "believe," "continue," "could," "intend," "may," "plan," "potential," "predict," "should," "will," "expect," "objective," "projection," "forecast," "goal," "guidance," "outlook," "effort," "target" and other similar words. However, the absence of these words does not mean that the statements are not forward-looking.
Actual results may differ materially from those expressed or implied by forward-looking statements as a result of many factors or events, including, but not limited to, legislative, regulatory and/or market developments, the outcome of pending lawsuits, governmental proceedings and investigations, the effects of competition, financial market conditions, access to capital, the timing and extent of changes in commodity prices and interest rates, weather conditions and other factors we discuss or refer to in the “Risk Factors” section of our most recent Annual Report on Form 10-K filed with the Securities and Exchange Commission.
Each forward-looking statement speaks only as of the date of the particular statement and we undertake no obligation to update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.
|
RRI Energy, Inc. and Subsidiaries Consolidated Statements of Operations (Unaudited) |
||||||||
| Three Months Ended March 31, | ||||||||
| 2009 | 2008 | |||||||
| (thousands of dollars, except per share amounts) | ||||||||
| Revenues: | ||||||||
|
Revenues (including $4,288 and $12,202 unrealized losses) (including $0 and $107,409 from affiliates) |
$ | 466,184 | $ | 879,798 | ||||
| Expenses: | ||||||||
|
Cost of sales (including $(39,455) and $43,002 unrealized gains (losses)) (including $0 and $35,713 from affiliates) |
324,674 | 508,839 | ||||||
| Operation and maintenance | 157,146 | 155,445 | ||||||
| General and administrative | 29,014 | 29,214 | ||||||
| Western states litigation and similar settlements | - | 34,000 | ||||||
| Gains on sales of assets and emission and exchange allowances, net | (18,930 | ) | (611 | ) | ||||
| Depreciation and amortization | 67,858 | 82,797 | ||||||
| Total operating expense | 559,762 | 809,684 | ||||||
| Operating Income (Loss) | (93,578 | ) | 70,114 | |||||
| Other Income (Expense): | ||||||||
| Income of equity investment, net | 541 | 207 | ||||||
| Debt extinguishments | - | (423 | ) | |||||
| Other, net | 51 | (64 | ) | |||||
| Interest expense | (46,919 | ) | (52,346 | ) | ||||
| Interest income | 248 | 6,425 | ||||||
| Total other expense | (46,079 | ) | (46,201 | ) | ||||
| Income (Loss) from Continuing Operations Before Income Taxes | (139,657 | ) | 23,913 | |||||
| Income tax expense (benefit) | (33,876 | ) | 10,977 | |||||
| Income (Loss) from Continuing Operations | (105,781 | ) | 12,936 | |||||
| Income (loss) from discontinued operations | (45,632 | ) | 364,276 | |||||
| Net Income (Loss) | $ | (151,413 | ) | $ | 377,212 | |||
| Basic Earnings (Loss) Per Share: | ||||||||
| Income (loss) from continuing operations | $ | (0.30 | ) | $ | 0.04 | |||
| Income (loss) from discontinued operations | (0.13 | ) | 1.05 | |||||
| Net income (loss) | $ | (0.43 | ) | $ | 1.09 | |||
| Diluted Earnings (Loss) Per Share: | ||||||||
| Income (loss) from continuing operations | $ | (0.30 | ) | $ | 0.04 | |||
| Income (loss) from discontinued operations | (0.13 | ) | 1.03 | |||||
| Net income (loss) | $ | (0.43 | ) | $ | 1.07 | |||
| Weighted Average Common Shares Outstanding (in thousands): | ||||||||
| - Basic | 350,487 | 345,419 | ||||||
| - Diluted | 350,487 | 354,103 | ||||||
| Reference is made to RRI Energy, Inc.'s Annual Report | ||||||||
| on Form 10-K for the year ended December 31, 2008. | ||||||||
|
RRI Energy, Inc. and Subsidiaries Results of Operations by Segment - Adjusted and Open (Unaudited) |
||||||||||||
| Three Months Ended March 31, | ||||||||||||
| 2009 | 2008 | Change | ||||||||||
| (millions of dollars) | ||||||||||||
| Wholesale Energy: | ||||||||||||
| Revenues | $ | 465 | $ | 879 | $ | (414 | ) | |||||
| Cost of sales | 324 | 509 | (185 | ) | ||||||||
| Wholesale hedges | 4 | (36 | ) | 40 | ||||||||
| Unrealized (gains) losses on energy derivatives | 44 | (30 | ) | 74 | ||||||||
| Open wholesale gross margin | 189 | 304 | (115 | ) | ||||||||
| Operation and maintenance | 156 | 152 | 4 | |||||||||
| Other | - | 1 | (1 | ) | ||||||||
| Open wholesale contribution margin | 33 | 151 | (118 | ) | ||||||||
| Wholesale hedges | (4 | ) | 36 | (40 | ) | |||||||
| Unrealized gains (losses) on energy derivatives | (44 | ) | 30 | (74 | ) | |||||||
|
Contribution margin, including wholesale hedges and unrealized gains/losses on energy derivatives (1) |
(15 | ) | 217 | (232 | ) | |||||||
| Other Operations: | ||||||||||||
| Revenues | $ | 2 | $ | 2 | $ | - | ||||||
| Cost of sales | - | - | - | |||||||||
| Operation and maintenance | - | 1 | (1 | ) | ||||||||
| Other operations contribution margin (1) | 2 | 1 | 1 | |||||||||
| Eliminations: | ||||||||||||
| Revenues | $ | (1 | ) | $ | (1 | ) | $ | - | ||||
| Cost of sales | - | - | - | |||||||||
| Operation and maintenance | - | - | - | |||||||||
| Total | (1 | ) | (1 | ) | - | |||||||
| Consolidated: | ||||||||||||
| Open wholesale contribution margin | $ | 33 | $ | 151 | $ | (118 | ) | |||||
| Other operations contribution margin | 2 | 1 | 1 | |||||||||
| Eliminations | (1 | ) | (1 | ) | - | |||||||
| Total | 34 | 151 | (117 | ) | ||||||||
| Operation and maintenance | (1 | ) |
(2) |
(3 | ) |
(2) |
2 | |||||
| General and administrative | (29 | ) | (28 | ) | (1 | ) | ||||||
| Income of equity investment, net | 1 | - | 1 | |||||||||
| Other, net | - | - | - | |||||||||
| Open EBITDA | 5 | 120 | (115 | ) | ||||||||
| Wholesale hedges | (4 | ) | 36 | (40 | ) | |||||||
| Gains on sales of assets and emission and exchange allowances, net | 18 | 1 | 17 | |||||||||
| Adjusted EBITDA | 19 | 157 | (138 | ) | ||||||||
| Unrealized gains (losses) on energy derivatives | (44 | ) | 30 | (74 | ) | |||||||
| Western states litigation and similar settlements | - | (34 | ) | 34 | ||||||||
| EBITDA | (25 | ) | 153 | (178 | ) | |||||||
| Depreciation and amortization | (68 | ) | (83 | ) | 15 | |||||||
| Interest expense | (47 | ) | (52 | ) | 5 | |||||||
| Interest income | - | 6 | (6 | ) | ||||||||
| Income (loss) from continuing operations before income taxes | $ | (140 | ) | $ | 24 | $ | (164 | ) | ||||
| (1) Segment profit and loss measure. | ||||||||||||
| (2) Relates primarily to general costs, which historically were allocated to our discontinued retail energy segment. | ||||||||||||
| Reference is made to RRI Energy, Inc.'s Annual Report | ||||||||||||
| on Form 10-K for the year ended December 31, 2008. | ||||||||||||
|
RRI Energy, Inc. and Subsidiaries Consolidated Balance Sheets (Unaudited) |
||||||||
| March 31, 2009 | December 31, 2008 | |||||||
| ASSETS | (thousands of dollars) | |||||||
| Current Assets: | ||||||||
| Cash and cash equivalents | $ | 1,410,315 | $ | 1,004,367 | ||||
| Restricted cash | 6,522 | 2,721 | ||||||
| Accounts and notes receivable, principally customer | 171,906 | 279,540 | ||||||
| Inventory | 295,375 | 314,999 | ||||||
| Derivative assets | 178,746 | 161,340 | ||||||
| Margin deposits | 125,893 | 231,676 | ||||||
| Investment in and receivables from Channelview, net | 58,636 | 58,703 | ||||||
| Prepayments and other current assets | 119,525 | 124,449 | ||||||
| Current assets of discontinued operations | 2,426,117 | 2,184,671 | ||||||
| Total current assets | 4,793,035 | 4,362,466 | ||||||
| Property, plant and equipment, gross | 6,468,178 | 6,417,268 | ||||||
| Accumulated depreciation | (1,656,356 | ) | (1,597,479 | ) | ||||
| Property, Plant and Equipment, net | 4,811,822 | 4,819,789 | ||||||
| Other Assets: | ||||||||
| Other intangibles, net | 377,121 | 380,554 | ||||||
| Prepaid lease | 279,651 | 273,374 | ||||||
| Other ($28,188 and $29,012 accounted for at fair value) | 303,339 | 298,431 | ||||||
| Long-term assets of discontinued operations | 658,892 | 494,781 | ||||||
| Total other assets | 1,619,003 | 1,447,140 | ||||||
| Total Assets | $ | 11,223,860 | $ | 10,629,395 | ||||
| LIABILITIES AND EQUITY | ||||||||
| Current Liabilities: | ||||||||
| Current portion of long-term debt and short-term borrowings | $ | 12,869 | $ | 12,517 | ||||
| Accounts payable, principally trade | 154,513 | 156,604 | ||||||
| Derivative liabilities | 254,087 | 202,206 | ||||||
| Other | 227,804 | 200,559 | ||||||
| Current liabilities of discontinued operations | 3,088,758 | 2,374,362 | ||||||
| Total current liabilities | 3,738,031 | 2,946,248 | ||||||
| Other Liabilities: | ||||||||
| Derivative liabilities | 127,871 | 140,493 | ||||||
| Other | 320,755 | 272,079 | ||||||
| Long-term liabilities of discontinued operations | 759,357 | 850,483 | ||||||
| Total other liabilities | 1,207,983 | 1,263,055 | ||||||
| Long-term Debt | 2,630,031 | 2,633,444 | ||||||
| Commitments and Contingencies | ||||||||
| Temporary Equity Stock-based Compensation | 9,769 | 9,004 | ||||||
| Stockholders' Equity: | ||||||||
|
|
||||||||
|
Preferred stock; par value $0.001 per share (125,000,000 shares authorized; none outstanding) |
- | - | ||||||
|
Common stock; par value $0.001 per share (2,000,000,000 shares authorized; 350,359,291 and 349,812,537 issued) |
111 | 111 | ||||||
| Additional paid-in capital | 6,243,969 | 6,238,639 | ||||||
| Accumulated deficit | (2,526,614 | ) | (2,375,201 | ) | ||||
| Accumulated other comprehensive loss | (79,420 | ) | (85,905 | ) | ||||
| Total stockholders' equity | 3,638,046 | 3,777,644 | ||||||
| Total Liabilities and Equity | $ | 11,223,860 | $ | 10,629,395 | ||||
|
RRI Energy, Inc. and Subsidiaries Consolidated Statements of Cash Flows (Unaudited) |
||||||||
| Three Months Ended March 31, | ||||||||
| 2009 | 2008 | |||||||
| (thousands of dollars) | ||||||||
| Cash Flows from Operating Activities: | ||||||||
| Net income (loss) | $ | (151,413 | ) | $ | 377,212 | |||
| (Income) loss from discontinued operations | 45,632 | (364,276 | ) | |||||
| Net income (loss) from continuing operations | (105,781 | ) | 12,936 | |||||
| Adjustments to Reconcile Net Income (Loss) to Net Cash Provided by Operating Activities: | ||||||||
| Depreciation and amortization | 67,858 | 82,797 | ||||||
| Deferred income taxes | (33,771 | ) | 9,319 | |||||
| Net changes in energy derivatives | 43,743 | (30,800 | ) | |||||
| Amortization of deferred financing costs | 1,737 | 2,554 | ||||||
| Gains on sales of assets and emission and exchange allowances, net | (18,930 | ) | (611 | ) | ||||
| Western states litigation and similar settlements | - | 34,000 | ||||||
| Other, net | 3,063 | 533 | ||||||
| Changes in other assets and liabilities: | ||||||||
| Accounts and notes receivable, net | 86,831 | (6,925 | ) | |||||
| Change in notes, receivables and payables with affiliates, net | 67 | (6,152 | ) | |||||
| Inventory | 21,219 | 27,262 | ||||||
| Margin deposits, net | 105,783 | 9,141 | ||||||
| Net derivative assets and liabilities | (10,298 | ) | (7,045 | ) | ||||
| Accounts payable | 2,287 | 30,410 | ||||||
| Other current assets | (5,102 | ) | (2,036 | ) | ||||
| Other assets | (4,221 | ) | (2,812 | ) | ||||
| Taxes payable/receivable | (2,689 | ) | 24,001 | |||||
| Other current liabilities | 40,076 | 27,893 | ||||||
| Other liabilities | 7,204 | 2,037 | ||||||
| Net cash provided by continuing operations from operating activities | 199,076 | 206,502 | ||||||
| Net cash provided by discontinued operations from operating activities | 289,161 | 97,552 | ||||||
| Net cash provided by operating activities | 488,237 | 304,054 | ||||||
| Cash Flows from Investing Activities: | ||||||||
| Capital expenditures | (55,472 | ) | (44,689 | ) | ||||
| Proceeds from sales of emission and exchange allowances | 12,798 | 1,717 | ||||||
| Purchases of emission allowances | (5,358 | ) | (4,073 | ) | ||||
| Restricted cash | (3,801 | ) | (1,687 | ) | ||||
| Net cash used in continuing operations from investing activities | (51,833 | ) | (48,732 | ) | ||||
| Net cash used in discontinued operations from investing activities | (15,728 | ) | (4,955 | ) | ||||
| Net cash used in investing activities | (67,561 | ) | (53,687 | ) | ||||
| Cash Flows from Financing Activities: | ||||||||
| Payments of long-term debt | - | (45,193 | ) | |||||
| Payments of debt extinguishments | - | (423 | ) | |||||
| Proceeds from issuances of stock | 2,163 | 5,067 | ||||||
| Net cash provided by (used in) financing activities | 2,163 | (40,549 | ) | |||||
| Net Change in Cash and Cash Equivalents, Total Operations | 422,839 | 209,818 | ||||||
| Net Change in Cash and Cash Equivalents, Discontinued Operations | (16,891 | ) | 4,621 | |||||
| Cash and Cash Equivalents at Beginning of Period, Continuing Operations | 1,004,367 | 524,070 | ||||||
| Cash and Cash Equivalents at End of Period, Continuing Operations | $ | 1,410,315 | $ | 738,509 | ||||
|
Free Cash Flow Reconciliation (Unaudited) |
||||||||
| Three Months Ended March 31, | ||||||||
| 2009 | 2008 | |||||||
| (millions of dollars) | ||||||||
| Operating cash flow from continuing operations | $ | 199 | $ | 207 | ||||
| Change in margin deposits, net | (106 | ) | (9 | ) | ||||
| Adjusted cash flow provided by continuing operations | 93 | 198 | ||||||
| Capital expenditures | (55 | ) | (45 | ) | ||||
| Proceeds from sales of emission and exchange allowances | 13 | 2 | ||||||
| Purchases of emission allowances | (5 | ) | (4 | ) | ||||
| Free cash flow provided by continuing operations | $ | 46 | $ | 151 | ||||
| Reference is made to RRI Energy, Inc.'s Annual Report | ||||||||
| on Form 10-K for the year ended December 31, 2008. | ||||||||
|
RRI Energy, Inc. and Subsidiaries Wholesale Energy Data (Unaudited) |
||||||||||||||||
| Three Months Ended March 31, | ||||||||||||||||
| 2009 | 2008 | |||||||||||||||
| GWh | % Economic (1) | GWh | % Economic (1) | |||||||||||||
| Economic Generation (2) (3): | ||||||||||||||||
| PJM Coal | 5,060.0 | 71 | % | 5,963.9 | 82 | % | ||||||||||
| MISO Coal | 1,175.8 | 43 | % | 2,048.4 | 74 | % | ||||||||||
| PJM/MISO Gas | 164.0 | 2 | % | 60.8 | 1 | % | ||||||||||
| West | 148.8 | 3 | % | 238.4 | 3 | % | ||||||||||
| Other | - | 0 | % | - | 0 | % | ||||||||||
| Total | 6,548.6 | 26 | % | 8,311.5 | 34 | % | ||||||||||
| Commercial Capacity Factor (4): | ||||||||||||||||
| PJM Coal | 81.5 | % | 84.9 | % | ||||||||||||
| MISO Coal | 81.9 | % | 75.3 | % | ||||||||||||
| PJM/MISO Gas | 95.4 | % | 93.9 | % | ||||||||||||
| West | 86.2 | % | 76.3 | % | ||||||||||||
| Other | 0.0 | % | 0.0 | % | ||||||||||||
| Total | 82.0 | % | 82.3 | % | ||||||||||||
| Generation (3): | GWh | GWh | ||||||||||||||
| PJM Coal | 4,123.1 | 5,062.9 | ||||||||||||||
| MISO Coal | 962.7 | 1,542.3 | ||||||||||||||
| PJM/MISO Gas | 156.4 | 57.1 | ||||||||||||||
| West | 128.2 | 181.8 | ||||||||||||||
| Other | - | - | ||||||||||||||
| Total | 5,370.4 | 6,844.1 | ||||||||||||||
| Open Energy Unit Margin ($/MWh) (5): | ||||||||||||||||
| PJM Coal | $ | 19.65 | $ | 35.55 | ||||||||||||
| MISO Coal | 11.43 | 29.83 | ||||||||||||||
| PJM/MISO Gas | 6.39 | 87.57 | ||||||||||||||
| West | 7.80 | NM | (6 | ) | ||||||||||||
| Other | - | - | ||||||||||||||
| Weighted average total | $ | 17.50 | $ | 33.02 | ||||||||||||
| Three Months Ended March 31, | ||||||||||||||||
| 2009 | 2008 | Change | ||||||||||||||
| Open energy gross margin (7): | (in millions) | |||||||||||||||
| PJM Coal | $ | 81 | $ | 180 | $ | (99 | ) | |||||||||
| MISO Coal | 11 | 46 | (35 | ) | ||||||||||||
| PJM/MISO Gas | 1 | 5 | (4 | ) | ||||||||||||
| West | 1 | (5 | ) | 6 | ||||||||||||
| Other | - | - | - | |||||||||||||
| Total | 94 | 226 | (132 | ) | ||||||||||||
| Other margin (8): | ||||||||||||||||
| PJM Coal | 34 | 18 | 16 | |||||||||||||
| MISO Coal | 2 | 2 | - | |||||||||||||
| PJM/MISO Gas | 38 | 27 | 11 | |||||||||||||
| West | 7 | 22 | (15 | ) | ||||||||||||
| Other | 14 | 9 | 5 | |||||||||||||
| Total | 95 | 78 | 17 | |||||||||||||
| Open wholesale gross margin | 189 | 304 | (115 | ) | ||||||||||||
| Operation and maintenance | (156 | ) | (152 | ) | (4 | ) | ||||||||||
| Other | - | (1 | ) | 1 | ||||||||||||
| Open wholesale contribution margin | 33 | 151 | (118 | ) | ||||||||||||
| Wholesale hedges | ||||||||||||||||
| Power | (10 | ) | (18 | ) | 8 | |||||||||||
| Fuel | (29 | ) | 36 | (65 | ) | |||||||||||
| Tolling/Other | 35 | 18 | 17 | |||||||||||||
| Total wholesale hedges | (4 | ) | 36 | (40 | ) | |||||||||||
| Unrealized gains (losses) on energy derivatives | (44 | ) | 30 | (74 | ) | |||||||||||
|
Total wholesale energy contribution margin, including wholesale hedges and unrealized gains/losses on energy derivatives (9) |
$ | (15 | ) | $ | 217 | $ | (232 | ) | ||||||||
| (1) Represents economic generation (hours) divided by maximum generation hours (maximum plant capacity multiplied by 8,760 hours). | ||||||||||||||||
|
(2) Estimated generation at 100% plant availability based on an hourly analysis of when it is economical to generate based on the price of power, fuel, emission allowances and variable operating costs. |
||||||||||||||||
| (3) Excludes generation related to power purchase agreements, including tolling agreements. | ||||||||||||||||
| (4) Generation divided by economic generation. | ||||||||||||||||
| (5) Represents open energy gross margin divided by generation. | ||||||||||||||||
| (6) NM is not meaningful. | ||||||||||||||||
|
(7) Open energy gross margin is calculated using the power sales prices received by the plants less delivered spot fuel prices. This figure excludes the effects of other margin, our wholesale hedges and unrealized gains/losses on energy derivatives. |
||||||||||||||||
| (8) Other margin represents power purchase agreements, capacity payments, ancillary services revenues and selective commercial hedge strategies. | ||||||||||||||||
| (9) Wholesale energy segment profit and loss measure. | ||||||||||||||||
| Reference is made to RRI Energy, Inc.'s Annual Report | ||||||||||||||||
| on Form 10-K for the year ended December 31, 2008. | ||||||||||||||||
|
RRI Energy, Inc. and Subsidiaries PJM Coal and MISO Coal (Unaudited) |
||||||||||||||||||
| Capacity | Heat Rate | Q1 economic generation (GWh) | Q1 commercial capacity factor | Q1 generation (GWh) | ||||||||||||||
| Unit Name (1) | (MW) | (MMBtu/MWh) | 2009 | 2008 | 2009 | 2008 | 2009 | 2008 | ||||||||||
| Cheswick | 580 | 10.0 | 847.1 | 841.0 | 89.9 | % | 90.7 | % | 761.6 | 762.7 | ||||||||
| Conemaugh (2) | 280 | 9.4 | 567.0 | 599.7 | 96.7 | % | 93.8 | % | 548.4 | 562.8 | ||||||||
| Elrama | 460 | 11.3 | 92.6 | 698.1 | 84.1 | % | 82.3 | % | 77.9 | 574.8 | ||||||||
| Keystone (2) | 282 | 9.5 | 591.4 | 609.2 | 84.4 | % | 96.9 | % | 499.2 | 590.6 | ||||||||
| Portland | 401 | 9.8 | 753.5 | 717.2 | 78.8 | % | 88.0 | % | 594.0 | 631.0 | ||||||||
| Seward | 521 | 9.6 | 1,046.8 | 1,084.8 | 55.5 | % | 67.2 | % | 581.1 | 728.8 | ||||||||
| Shawville (2) | 597 | 10.3 | 800.3 | 1,053.2 | 91.1 | % | 83.2 | % | 729.2 | 876.3 | ||||||||
| Titus | 243 | 10.8 | 361.3 | 360.7 | 91.8 | % | 93.1 | % | 331.7 | 335.9 | ||||||||
| PJM Coal Total | 3,364 | 5,060.0 | 5,963.9 | 81.5 | % | 84.9 | % | 4,123.1 | 5,062.9 | |||||||||
| Capacity | Heat Rate | Q1 economic generation (GWh) | Q1 commercial capacity factor | Q1 generation (GWh) | ||||||||||||||
| Unit Name (1) | (MW) | (MMBtu/MWh) | 2009 | 2008 | 2009 | 2008 | 2009 | 2008 | ||||||||||
| Avon Lake | 721 | 9.3 | 885.4 | 1,162.7 | 83.8 | % | 66.7 | % | 742.1 | 775.4 | ||||||||
| New Castle | 328 | 10.6 | 148.2 | 495.5 | 86.3 | % | 89.5 | % | 127.9 | 443.7 | ||||||||
| Niles | 216 | 10.5 | 142.2 | 390.2 | 65.2 | % | 82.8 | % | 92.7 | 323.2 | ||||||||
| MISO Coal Total | 1,265 | 1,175.8 | 2,048.4 | 81.9 | % | 75.3 | % | 962.7 | 1,542.3 | |||||||||
| (1) Unless otherwise indicated, the Company owns a 100% interest in each facility listed. | ||||||||||||||||||
|
(2) The Company leases a 100% interest in the Shawville facility, a 16.67% interest in the Keystone facility and a 16.45% interest in the Conemaugh facility under facility interest lease agreements, which expire in 2026, 2034 and 2034, respectively. |
||||||||||||||||||
| Reference is made to RRI Energy, Inc.'s Annual Report | ||||||||||||||||||
| on Form 10-K for the year ended December 31, 2008. | ||||||||||||||||||
|
RRI Energy, Inc. and Subsidiaries PJM/MISO Gas (Unaudited) |
||||||||||||||||||
| Capacity | Heat Rate | Q1 economic generation (GWh) | Q1 commercial capacity factor | Q1 generation (GWh) | ||||||||||||||
| Unit Name (1) | (MW) | (MMBtu/MWh) | 2009 | 2008 | 2009 | 2008 | 2009 | 2008 | ||||||||||
| Aurora (2) | 878 | 10.5 | 1.4 | 4.0 | 100.0 | % | 100.0 | % | 1.4 | 4.0 | ||||||||
| Blossburg | 19 | 14.6 | 0.1 | 6.6 | 100.0 | % | 90.9 | % | 0.1 | 6.0 | ||||||||
| Brunot Island | 289 | 10.4 | - | - | 0.0 | % | 0.0 | % | - | - | ||||||||
| Gilbert | 536 | 11.0 | 7.9 | 4.2 | 100.0 | % | 100.0 | % | 7.9 | 4.2 | ||||||||
| Glen Gardner | 160 | 14.6 | - | 0.3 | 0.0 | % | 100.0 | % | - | 0.3 | ||||||||
| Hamilton | 20 | 14.8 | 0.1 | 0.2 | 100.0 | % | 100.0 | % | 0.1 | 0.2 | ||||||||
| Hunterstown | 60 | 14.8 | 0.3 | 0.4 | 100.0 | % | 100.0 | % | 0.3 | 0.4 | ||||||||
| Hunterstown CCGT | 810 | 7.0 | 148.1 | 7.7 | 95.5 | % | 100.0 | % | 141.4 | 7.7 | ||||||||
| Mountain | 40 | 14.3 | 1.5 | 2.2 | 100.0 | % | 100.0 | % | 1.5 | 2.2 | ||||||||
| Orrtanna | 20 | 14.4 | - | 0.3 | 0.0 | % | 100.0 | % | - | 0.3 | ||||||||
| Portland | 169 | 11.2 | 1.9 | 5.4 | 100.0 | % | 100.0 | % | 1.9 | 5.4 | ||||||||
| Sayreville | 224 | 13.8 | 1.4 | 25.6 | 85.7 | % | 88.3 | % | 1.2 | 22.6 | ||||||||
| Shawnee | 20 | 14.0 | - | - | 0.0 | % | 0.0 | % | - | - | ||||||||
| Shawville 5-7 (3) | 6 | 10.2 | - | - | 0.0 | % | 0.0 | % | - | - | ||||||||
| Titus | 31 | 17.4 | - | - | 0.0 | % | 0.0 | % | - | - | ||||||||
| Tolna | 40 | 14.2 | 0.2 | 0.4 | 100.0 | % | 100.0 | % | 0.2 | 0.4 | ||||||||
| Warren | 68 | 12.8 | - | - | 0.0 | % | 0.0 | % | - | - | ||||||||
| Werner | 212 | 13.8 | 1.1 | 3.5 | 36.4 | % | 97.1 | % | 0.4 | 3.4 | ||||||||
| Shelby | 356 | 9.8 | - | - | 0.0 | % | 0.0 | % | - | - | ||||||||
| PJM/MISO Gas Total | 3,958 | 164.0 | 60.8 | 95.4 | % | 93.9 | % | 156.4 | 57.1 | |||||||||
| (1) Unless otherwise indicated, the Company owns a 100% interest in each facility listed. | ||||||||||||||||||
| (2) Excludes generation during periods the unit operated under power purchase agreements. | ||||||||||||||||||
| (3) The Company leases a 100% interest in the Shawville facility under a facility interest lease agreement, which expires in 2026. | ||||||||||||||||||
| Reference is made to RRI Energy, Inc.'s Annual Report | ||||||||||||||||||
| on Form 10-K for the year ended December 31, 2008. | ||||||||||||||||||
|
RRI Energy, Inc. and Subsidiaries West and Other (Unaudited) |
||||||||||||||||||
| Capacity | Heat Rate | Q1 economic generation (GWh) | Q1 commercial capacity factor | Q1 generation (GWh) | ||||||||||||||
| Unit Name (1) | (MW) | (MMBtu/MWh) | 2009 | 2008 | 2009 | 2008 | 2009 | 2008 | ||||||||||
| Bighorn (2) | 598 | 7.2 | - | - | 0.0 | % | 0.0 | % | - | - | ||||||||
| Coolwater | 622 | 10.1 | 21.3 | 94.1 | 3.3 | % | 80.2 | % | 0.7 | 75.5 | ||||||||
| Ellwood (3) | 54 | 13.3 | - | - | 0.0 | % | 0.0 | % | - | - | ||||||||
| Etiwanda (3) | 640 | 10.0 | - | - | 0.0 | % | 0.0 | % | - | - | ||||||||
| Mandalay (3) | 560 | 10.9 | 67.2 | 60.6 | 100.0 | % | 100.0 | % | 67.2 | 60.6 | ||||||||
| Ormond Beach | 1,516 | 9.6 | 60.3 | 83.7 | 100.0 | % | 54.6 | % | 60.3 | 45.7 | ||||||||
| West Total | 3,990 | 148.8 | 238.4 | 86.2 | % | 76.3 | % | 128.2 | 181.8 | |||||||||
| Capacity | Heat Rate | Q1 economic generation (GWh) | Q1 commercial capacity factor | Q1 generation (GWh) | ||||||||||||||
| Unit Name (1) | (MW) | (MMBtu/MWh) | 2009 | 2008 | 2009 | 2008 | 2009 | 2008 | ||||||||||
| Choctaw | 800 | 7.0 | - | - | 0.0 | % | 0.0 | % | - | - | ||||||||
| Indian River (3) | 587 | 10.5 | - | - | 0.0 | % | 0.0 | % | - | - | ||||||||
| Osceola (3) | 470 | 11.0 | - | - | 0.0 | % | 0.0 | % | - | - | ||||||||
| Other Total | 1,857 | - | - | 0.0 | % | 0.0 | % | - | - | |||||||||
| (1) Unless otherwise indicated, the Company owns a 100% interest in each facility listed. | ||||||||||||||||||
| (2) The Bighorn facility was sold October 20, 2008. | ||||||||||||||||||
| (3) Excludes generation during periods the unit operated under power purchase agreements. | ||||||||||||||||||
| Reference is made to RRI Energy, Inc.'s Annual Report | ||||||||||||||||||
| on Form 10-K for the year ended December 31, 2008. | ||||||||||||||||||
|
RRI Energy, Inc. and Subsidiaries Capital Expenditures Forecast (Unaudited) |
||||||
| 2009E | 2010E | |||||
| (in millions) | ||||||
| Maintenance capital expenditures: | ||||||
| Wholesale energy | $ | 37 | $ | 53 | ||
| Other operations | 8 | 10 | ||||
| 45 | 63 | |||||
| Environmental (1) | 126 | 29 | ||||
| Capitalized interest | 30 | - | ||||
| Total capital expenditures | $ | 201 | $ | 92 | ||
| (1) Estimate represents the low end of the range. | ||||||
| Reference is made to RRI Energy, Inc.'s Annual Report | ||||||
| on Form 10-K for the year ended December 31, 2008. | ||||||
|
RRI Energy, Inc. and Subsidiaries Gross Debt (Unaudited) |
|||||
| March 31, 2009 | |||||
| (in millions) | |||||
| Debt: | |||||
| Senior secured revolver | $ | - | |||
| Senior secured notes | 531 | (1 | ) | ||
| Senior unsecured notes | 1,300 | ||||
| Orion Power 12% notes (2) | 414 | ||||
| PEDFA fixed-rate bonds for Seward plant | 398 | (3 | ) | ||
| Total GAAP debt | 2,643 | ||||
| Debt classified as discontinued operations | 238 | ||||
| REMA operating leases (off-balance sheet) | 443 | ||||
| Gross Debt (4) | $ | 3,324 | |||
| Gross Debt, excluding discontinued operations (4) | $ | 3,086 | |||
| (1) Excludes $136 million classified in discontinued operations. | |||||
| (2) Orion Power 12% notes include purchase accounting adjustments of $14 million. | |||||
| (3) Excludes $102 million classified in discontinued operations. | |||||
| (4) Gross debt includes off-balance sheet REMA leases of $443 million. | |||||
| Reference is made to RRI Energy, Inc.'s Annual Report | |||||
| on Form 10-K for the year ended December 31, 2008. | |||||
Contact:
RRI Energy, Inc.
Dennis Barber, 713-497-3042 (Investor Relations)
Laurie Fickman, 713-497-7720 (Media Relations)
www.rrienergy.com
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