HOUSTON, Texas, Jan. 8, 2003 — Dynegy Inc. on Wednesday announced its liquidity position as of Dec. 31, 2002 and 2003 guidance for earnings per share, earnings before interest and taxes and operating cash flow for its generation, natural gas liquids and regulated energy delivery segments:
— As of Dec. 31, Dynegy’s liquidity was $1.47 billion. This consisted of $915 million in cash, including $137 million in escrow relating to the Illinois Power bond offering, $1.4 billion in bank lines and $258 million of remaining highly liquid inventories, less $228 million of draws against bank lines and $878 million in letters of credit posted for collateral relating principally to third-party aspects of the company’s marketing and trading business;
— In addition to maintaining a $1.47 billion liquidity position during the fourth quarter, the company reduced its bank exposure and debt by approximately $850 million and will re-pay an additional $100 million later this month;
— Earnings per share is estimated to be $0.08 to $0.15 in 2003;
— Earnings before interest and taxes is estimated to be $465 to $500 million in 2003; and
— Operating cash flow, including working capital changes, is estimated to be $1.2 to $1.3 billion in 2003. This consists of $635 to $665 million from the three operating segments and $595 to $600 million from risk management roll-off and the return of cash collateral, less corporate-level general and administrative, interest and other cash expenses.
In addition to the results for the operating segments, guidance estimates include certain corporate-level general and administrative, depreciation, interest and other expenses. Guidance estimates exclude the results associated with the businesses that the company is currently exiting – communications and third-party marketing and trading, including tolling contracts – and any costs required to execute these exits, except in the case of operating cash flow, which reflects the benefits of the risk management roll-off and the return of cash collateral.
The earnings per share estimate of $0.08 to $0.15 in 2003 equates to net income of $31 to $54 million. The earnings before interest and taxes estimate of $465 million reconciles to the low end of the net income range with interest expense estimated to be $417 million and taxes estimated to be $17 million.
Dynegy Inc. owns operating divisions engaged in power generation, natural gas liquids and regulated energy delivery. Through these business units, the company serves customers by delivering value-added solutions to meet their energy needs.