PR Newswire | Aug 4, 2021 06:31AM EDT

08/04 05:30 CDT

Entergy Reports Second Quarter EarningsCompany affirms guidance and financial outlooks, expects results in top half of ranges NEW ORLEANS, Aug. 4, 2021

NEW ORLEANS, Aug. 4, 2021 /PRNewswire/ -- Entergy Corporation (NYSE: ETR) reported a second quarter 2021 loss per share of (3) cents on an as-reported basis and earnings per share of $1.34 on an adjusted basis (non-GAAP). The as-reported loss included an impairment of $340 million ($268 million net-of-tax) resulting from the sale of Indian Point Energy Center.

"We executed on key deliverables and achieved solid second quarter results," said Entergy Chairman and Chief Executive Officer Leo Denault. "Our multi-year efforts to de-risk our business, as recently recognized by Moody's, have unlocked greater financial flexibility, which helps us manage risks and lower our equity needs. As a result, we expect to achieve results in the upper half of guidance and outlook ranges. Our underlying growth outlook is driven by investments that will improve customer outcomes, including those that will provide clean, sustainable energy."

Business highlights included the following:

* The Arkansas Public Service Commission approved Entergy Arkansas' Walnut Bend Solar project. * Entergy Texas began the process to seek approval to construct hydrogen-capable Orange County Advanced Power Station. * The Mississippi Public Service Commission approved Entergy Mississippi's annual FRP filing. * Entergy Arkansas, Entergy Louisiana, and Entergy New Orleans each submitted their annual FRP filings. * Entergy New Orleans' Green Power Option achieved Green-e(r) Energy Certification by the Center for Resource Solutions. * Entergy completed the sale of Indian Point. * EEI announced Entergy Corporation as a recipient of three EEI emergency response awards. * For the sixth consecutive year, Entergy was named to The Civic 50, a Points of Light initiative honoring the 50 most community-minded companies in the U.S.

Consolidated Earnings (GAAP and Non-GAAP Measures)

Second Quarter and Year-to-Date 2021 vs. 2020 (See Appendix A forreconciliation of GAAP to non-GAAP measures and description of adjustments)

Second Quarter Year-to-Date

2021 2020 Change 2021 2020 Change

(After-tax, $ in millions)

As-reported earnings (6) 361 (367) 329 479 (151)

Less adjustments (275) 85 (360) (238) (26) (211)

Adjusted earnings (non-GAAP) 269 276 (7) 566 506 61

Estimated weather in billed sales (19) (4) (15) 5 (54) 59

(After-tax, per share in $)

As-reported earnings (0.03) 1.79 (1.82) 1.63 2.39 (0.76)

Less adjustments (1.37) 0.42 (1.79) (1.18) (0.13) (1.05)

Adjusted earnings (non-GAAP) 1.34 1.37 (0.03) 2.81 2.52 0.29

Estimated weather in billed sales (0.09) (0.02) (0.07) 0.02 (0.27) 0.29

Calculations may differ due to rounding

Consolidated Results

For second quarter 2021, the company reported a loss of $(6 million), or (3) cents per share, on an as-reported basis, and earnings of $269 million, or $1.34 per share, on an adjusted basis. This compared to second quarter 2020 earnings of $361 million, or $1.79 per share, on an as-reported basis, and earnings of $276 million, or $1.37 per share, on an adjusted basis.

Summary discussions by business are below. Additional details, including information on OCF by business, are provided in Appendix A. An analysis of quarterly and year-to-date variances by business is provided in Appendix B.

Business Segment Results

Utility

For second quarter 2021, the Utility business reported earnings attributable to Entergy Corporation of $326 million, or $1.62 per share, on both an as-reported and an adjusted basis. This compared to second quarter 2020 earnings of $345 million, or $1.71 per share, on both an as-reported and an adjusted basis. Drivers for the quarter included:

* higher other O&M primarily due to higher non-nuclear generation and nuclear expenses, higher distribution spending, as well as higher benefits costs; and * higher depreciation expense.

These drivers were partially offset by:

* higher retail sales from volume, including recovery from COVID-19; and * the net effect of regulatory actions across the operating companies.

Appendix C contains additional details on Utility financial and operating measures.

Parent & Other

For second quarter 2021, Parent & Other reported a loss attributable to Entergy Corporation of $(57 million), or (28) cents per share, on both an as-reported and an adjusted basis. This compared to a second quarter 2020 loss of $(69 million), or (34) cents per share, on both an as-reported and an adjusted basis. The primary driver was an income tax item recorded in second quarter 2021 related to the reversal of a valuation allowance for interest deductibility.

Entergy Wholesale Commodities

For second quarter 2021, EWC reported a loss attributable to Entergy Corporation of $(275 million), or $(1.37) per share, on an as-reported basis. This compared to second quarter 2020 earnings attributable to Entergy Corporation of $85 million, or 42 cents per share, on an as-reported basis. Drivers for the quarter included:

* a loss of $340 million ($268 million net-of-tax) as a result of the sale of Indian Point; * performance of decommissioning trust funds; and * lower revenue primarily due to the shutdown of Indian Point 2 and Indian Point 3.

These drivers were partially offset by:

* lower operating expenses primarily due to the shutdown of Indian Point 2 and Indian Point 3; and * lower decommissioning expense due to the sale of Indian Point.

Appendix D contains additional details on EWC financial and operating measures, including reconciliation for non-GAAP EWC adjusted EBITDA.

Earnings Per Share Guidance

Entergy affirmed its 2021 adjusted EPS guidance range of $5.80 to $6.10, and the company expects results to be in the upper half of the range. See webcast presentation for additional details.

The company has provided 2021 earnings guidance with regard to the non-GAAP measure of Entergy adjusted EPS. This measure excludes from the corresponding GAAP financial measure the effect of adjustments as described below under "Non-GAAP Financial Measures." The company has not provided a reconciliation of such non-GAAP guidance to guidance presented on a GAAP basis because it cannot predict and quantify with a reasonable degree of confidence all of the adjustments that may occur during the period. One such adjustment will be the exclusion of EWC earnings from Entergy adjusted EPS. We currently estimate that the contribution of EWC to Entergy's as-reported EPS will be approximately $(1.10) in 2021. This estimate is subject to substantial uncertainty due to, among other things, the potential effects of exiting the EWC business.

Earnings Teleconference

A teleconference will be held at 10:00 a.m. Central Time on Wednesday, August 4, 2021, to discuss Entergy's quarterly earnings announcement and the company's financial performance. The teleconference may be accessed by visiting Entergy's website at www.entergy.com or by dialing 844-309-6569, conference ID 9088373, no more than 15 minutes prior to the start of the call. The webcast presentation is also posted to Entergy's website concurrent with this news release, which was issued before market open on the day of the call. A replay of the teleconference will be available on Entergy's website at www.entergy.com and by telephone. The telephone replay will be available through August 11, 2021, by dialing 855-859-2056, conference ID 9088373.

Entergy Corporation is an integrated energy company engaged in electric power production, transmission and retail distribution operations. Entergy delivers electricity to nearly 3 million utility customers in Arkansas, Louisiana, Mississippi and Texas. Entergy owns and operates one of the cleanest large-scale U.S. power generating fleets with approximately 30,000 megawatts of electric generating capacity, including 7,000 megawatts of nuclear power. Headquartered in New Orleans, Louisiana, Entergy has annual revenues of $10 billion and approximately 12,500 employees.

Entergy Corporation's common stock is listed on the New York Stock Exchange and NYSE Chicago under the symbol "ETR".

Details regarding Entergy's results of operations, regulatory proceedings, and other matters are available in this earnings release, a copy of which will be filed with the SEC, and the webcast presentation. Both documents are available on Entergy's Investor Relations website at www.entergy.com/investor_relations.

Entergy maintains a web page as part of its Investor Relations website, entitled Regulatory and Other Information, which provides investors with key updates of certain regulatory proceedings and important milestones on the execution of its strategy. While some of this information may be considered material information, investors should not rely exclusively on this page for all relevant company information.

For definitions of certain operating measures, as well as GAAP and non-GAAP financial measures and abbreviations and acronyms used in the earnings release materials, see Appendix F.

Non-GAAP Financial Measures

This news release contains non-GAAP financial measures, which are generally numerical measures of a company's performance, financial position, or cash flows that either exclude or include amounts that are not normally excluded or included in the most directly comparable measure calculated and presented in accordance with GAAP. Entergy has provided quantitative reconciliations within this news release of the non-GAAP financial measures to the most directly comparable GAAP financial measures.

Entergy reports earnings using the non-GAAP measure of Entergy adjusted earnings, which excludes the effect of certain "adjustments," including the removal of the Entergy Wholesale Commodities segment in light of the company's decision to exit the merchant power business. Adjustments are unusual or non-recurring items or events or other items or events that management believes do not reflect the ongoing business of Entergy, such as the results of the EWC segment, significant tax items, and other items such as certain costs, expenses, or other specified items. In addition to reporting GAAP consolidated earnings on a per share basis, Entergy reports its adjusted earnings on a per share basis. These per share measures represent the applicable earnings amount divided by the diluted average number of common shares outstanding for the period.

Management uses the non-GAAP financial measures of adjusted earnings and adjusted earnings per share for, among other things, financial planning and analysis; reporting financial results to the board of directors, employees, stockholders, analysts, and investors; and internal evaluation of financial performance. Entergy believes that these non-GAAP financial measures provide useful information to investors in evaluating the ongoing results of Entergy's business, comparing period to period results, and comparing Entergy's financial performance to the financial performance of other companies in the utility sector.

Other non-GAAP measures, including adjusted EBITDA; adjusted ROE; adjusted ROE, excluding affiliate preferred; adjusted ROIC; gross liquidity; net liquidity; net liquidity, including storm escrows; debt to capital, excluding securitization debt; net debt to net capital, excluding securitization debt; parent debt to total debt, excluding securitization debt; FFO to debt, excluding securitization debt; and FFO to debt, excluding securitization debt, return of unprotected excess ADIT, and severance and retention payments associated with exit of EWC, are measures Entergy uses internally for management and board discussions and to gauge the overall strength of its business. Entergy believes the above data provides useful information to investors in evaluating Entergy's ongoing financial results and flexibility, and assists investors in comparing Entergy's credit and liquidity to the credit and liquidity of others in the utility sector. In addition, other financial measures including net income (or earnings) adjusted for preferred dividends and tax-effected interest expense and FFO are included on both an adjusted and an as-reported basis. In each case, the metrics defined as "adjusted" (other than EWC's adjusted EBITDA) exclude the effect of adjustments as defined above. EWC's adjusted EBITDA represents EWC's earnings before interest, taxes, and depreciation and amortization, and also excludes decommissioning expense.

These non-GAAP financial measures reflect an additional way of viewing aspects of Entergy's operations that, when viewed with Entergy's GAAP results and the accompanying reconciliations to corresponding GAAP financial measures, provide a more complete understanding of factors and trends affecting Entergy's business. These non-GAAP financial measures should not be used to the exclusion of GAAP financial measures. Investors are strongly encouraged to review Entergy's consolidated financial statements and publicly filed reports in their entirety and not to rely on any single financial measure. Although certain of these measures are intended to assist investors in comparing Entergy's performance to other companies in the utility sector, non-GAAP financial measures are not standardized; therefore, it might not be possible to compare these financial measures with other companies' non-GAAP financial measures having the same or similar names.

Cautionary Note Regarding Forward-Looking Statements

In this news release, and from time to time, Entergy Corporation makes certain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements include, among other things, statements regarding Entergy's 2021 earnings guidance; its current financial and operational outlooks; and other statements of Entergy's plans, beliefs, or expectations included in this news release. Readers are cautioned not to place undue reliance on these forward-looking statements, which apply only as of the date of this news release. Except to the extent required by the federal securities laws, Entergy undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise.

Forward-looking statements are subject to a number of risks, uncertainties, and other factors that could cause actual results to differ materially from those expressed or implied in such forward-looking statements, including (a) those factors discussed elsewhere in this news release and in Entergy's most recent Annual Report on Form 10-K, any subsequent Quarterly Reports on Form 10-Q, and Entergy's other reports and filings made under the Securities Exchange Act of 1934; (b) uncertainties associated with (1) rate proceedings, formula rate plans, and other cost recovery mechanisms, including the risk that costs may not be recoverable to the extent anticipated by the utilities and (2) implementation of the ratemaking effects of changes in law; (c) uncertainties associated with efforts to remediate the effects of major storms and recover related restoration costs; (d) risks associated with operating nuclear facilities, including plant relicensing, operating, and regulatory costs and risks; (e) changes in decommissioning trust fund values or earnings or in the timing or cost of decommissioning Entergy's nuclear plant sites; (f) legislative and regulatory actions and risks and uncertainties associated with claims or litigation by or against Entergy and its subsidiaries; (g) risks and uncertainties associated with executing on business strategies, including strategic transactions that Entergy or its subsidiaries may undertake and the risk that any such transaction may not be completed as and when expected and the risk that the anticipated benefits of the transaction may not be realized; (h) effects of changes in federal, state, or local laws and regulations and other governmental actions or policies, including changes in monetary, fiscal, tax, environmental, or energy policies; (i) the effects of changes in commodity markets, capital markets, or economic conditions; (j) impacts from a terrorist attack, cybersecurity threats, data security breaches, or other attempts to disrupt Entergy's business or operations, and/or other catastrophic events; (k) the direct and indirect impacts of the COVID-19 pandemic on Entergy and its customers; and (l) the effects of technological change, including the costs, pace of development and commercialization of new and emerging technologies.

Second Quarter 2021 Earnings Release Appendices and Financial Statements

Appendices

A: Consolidated Results and AdjustmentsB: Earnings Variance AnalysisC: Utility Financial and Operating MeasuresD: EWC Financial and Operating MeasuresE: Consolidated Financial MeasuresF: Definitions and Abbreviations and AcronymsG: Other GAAP to Non-GAAP Reconciliations

Financial Statements

Consolidating Balance SheetsConsolidating Income StatementsConsolidated Cash Flow Statements

A: Consolidated Results and AdjustmentsAppendix A-1 provides a comparative summary of consolidated earnings, including a reconciliation of as-reported earnings (GAAP) to adjusted earnings (non-GAAP).

Appendix A-1: Consolidated Earnings - Reconciliation of GAAP to Non-GAAP Measures Second Quarter and Year-to-Date 2021 vs. 2020 (See Appendix A-3 and Appendix A-4 for details on adjustments)

Second Quarter Year-to-Date

2021 2020 Change 2021 2020 Change

(After-tax, $ in millions)

As-reported earnings (loss)

Utility 326 345 (19) 682 665 18

Parent & Other (57) (69) 12 (116) (159) 43

EWC (275) 85 (360) (238) (26) (211)

Consolidated (6) 361 (367) 329 479 (151)



Less adjustments

Utility - - - - - -

Parent & Other - - - - - -

EWC (275) 85 (360) (238) (26) (211)

Consolidated (275) 85 (360) (238) (26) (211)



Adjusted earnings (loss) (non-GAAP)

Utility 326 345 (19) 682 665 18

Parent & Other (57) (69) 12 (116) (159) 43

EWC - - - - - -

Consolidated 269 276 (7) 566 506 61

Estimated weather in billed sales (19) (4) (15) 5 (54) 59



Diluted average number of common shares outstanding (in millions) 201 201 201 201



(After-tax, per share in $) (a)

As-reported earnings (loss)

Utility 1.62 1.71 (0.09) 3.39 3.31 0.08

Parent & Other (0.28) (0.34) 0.06 (0.58) (0.79) 0.21

EWC (1.37) 0.42 (1.79) (1.18) (0.13) (1.05)

Consolidated (0.03) 1.79 (1.82) 1.63 2.39 (0.76)



Less adjustments

Utility - - - - - -

Parent & Other - - - - - -

EWC (1.37) 0.42 (1.79) (1.18) (0.13) (1.05)

Consolidated (1.37) 0.42 (1.79) (1.18) (0.13) (1.05)



Adjusted earnings (loss) (non-GAAP)

Utility 1.62 1.71 (0.09) 3.39 3.31 0.08

Parent & Other (0.28) (0.34) 0.06 (0.58) (0.79) 0.21

EWC - - - - - -

Consolidated 1.34 1.37 (0.03) 2.81 2.52 0.29

Estimated weather in billed sales (0.09) (0.02) (0.07) 0.02 (0.27) 0.29



Calculations may differ due to rounding (a) Per share amounts are calculated by dividing the corresponding earnings (loss) by the diluted average number of common shares outstanding for the period.

See Appendix B for detailed earnings variance analysis.

Appendix A-2 provides a comparative summary of OCF, by business.

Appendix A-2: Consolidated Operating Cash Flow

Second Quarter and Year-to-Date 2021 vs. 2020

($ in millions)

Second Quarter Year-to-Date

2021 2020Change2021 2020 Change

Utility 1,014792 222 937 1,395(458)

Parent & Other(64) (64)(1) (86) (144)59

EWC (154)60 (214) (105)198 (302)

Consolidated 796 789 7 747 1,448(702)



Calculations may differ due to rounding

OCF increased quarter-over-quarter due primarily to higher collections from Utility customers. This was largely offset by the timing of fuel and purchased power cost recovery, primarily related to increased fuel costs; higher severance and retention payouts at EWC; payments related to storm restoration (non-capital portion); and lower DOE proceeds.Intercompany income tax payments contributed to the line of business variances but were immaterial at the consolidated level.

Appendix A-3 and Appendix A-4 list adjustments by business. Adjustments are included in as-reported earnings consistent with GAAP but are excluded from adjusted earnings. As a result, adjusted earnings is considered a non-GAAP measure.

Appendix A-3: Adjustments by Driver (shown as positive/(negative) impact onearnings or EPS)

Second Quarter and Year-to-Date 2021 vs. 2020

Second Quarter Year-to-Date

2021 2020 Change 2021 2020 Change

(Pre-tax except for income taxes, preferred dividend requirements, and totals;$ in millions)

EWC

Income before income taxes (346) 110 (455) (293) (31) (261)

Income taxes 72 (24) 96 56 6 50

Preferred dividend requirements (1) (1) - (1) (1) -

Total EWC (275) 85 (360) (238) (26) (211)

Total adjustments (275) 85 (360) (238) (26) (211)

(After-tax, per share in $) (b)

EWC

Total EWC (1.37) 0.42 (1.79) (1.18) (0.13) (1.05)

Total adjustments (1.37) 0.42 (1.79) (1.18) (0.13) (1.05)

Calculations may differ due to rounding

(b) Per share amounts are calculated by dividing the corresponding earnings(loss) by the diluted average number of common shares outstanding for theperiod.

Appendix A-4: Adjustments by Income Statement Line Item (shown as positive/(negative) impact on earnings)

Second Quarter and Year-to-Date 2021 vs. 2020

(Pre-tax except for income taxes, preferred dividend requirements, and totals;$ in millions)

Second Quarter Year-to-Date

2021 2020 Change 2021 2020 Change

EWC

Operating revenues 149 200 (51) 397 532 (135)

Fuel and fuel-related expenses (17) (17) - (39) (37) (1)

Purchased power (18) (10) (8) (36) (21) (15)

Nuclear refueling outage expense (11) (12) 1 (22) (24) 2

Other O&M (83) (140) 57 (182) (271) 89

Asset write-off and impairments (342) (7) (335) (345) (12) (333)

Decommissioning expense (40) (51) 12 (93) (102) 9

Taxes other than income taxes (6) (14) 8 (12) (34) 22

Depreciation/amortization exp. (14) (25) 11 (27) (60) 33

Other income (deductions)-other 41 194 (153) 75 10 65

Interest exp. and other charges (4) (7) 3 (8) (12) 4

Income taxes 72 (24) 96 56 6 50

Preferred dividend requirements (1) (1) - (1) (1) -

Total EWC (275) 85 (360) (238) (26) (211)

Total adjustments (275) 85 (360) (238) (26) (211)

Calculations may differ due to rounding

B: Earnings Variance AnalysisAppendix B-1 and Appendix B-2 provide details of current quarter and year-to-date 2021 versus 2020 as-reported and adjusted earnings variance analysis for Utility, Parent & Other, and EWC.

Appendix B-1: As-Reported and Adjusted Earnings Variance Analysis (c), (d)

Second Quarter 2021 vs. 2020

(After-tax, per share in $)

Utility Parent & Other EWC Consolidated

As- Adjusted As- Adjusted As- As- Adjusted Reported Reported Reported Reported

2020 earnings 1.71 1.71 (0.34) (0.34) 0.42 1.79 1.37(loss)

Operatingrevenue less:

Fuel,fuel-relatedexpenses and

gas purchased 0.64 0.64 (e) - - (0.23) (f) 0.41 0.64for resale,

Purchasedpower, and

Regulatorycharges(credits)-net

Nuclearrefueling - - - - - - -outage expense

Other O&M (0.38) (0.38) (g) - - 0.23 (h) (0.15) (0.38)

Assetwrite-offs and - - - - (1.32) (i) (1.32) -impairments

Decommissioning (0.01) (0.01) - - 0.05 (j) 0.04 (0.01)expense

Taxes otherthan income (0.02) (0.02) - - 0.03 0.01 (0.02)taxes

Depreciation/amortization (0.10) (0.10) (k) - - 0.04 (0.06) (0.10)exp.

Other income(deductions) (0.17) (0.17) (l) 0.02 0.02 (0.60) (m) (0.75) (0.15)-other

Interest exp.and other (0.04) (0.04) (0.01) (0.01) 0.01 (0.04) (0.05)charges

Income (0.01) (0.01) 0.05 0.05 (n) - 0.04 0.04taxes-other

Preferreddividend - - - - - - -requirements

Share effect - - - - - - -

2021 earnings 1.62 1.62 (0.28) (0.28) (1.37) (0.03) 1.34(loss)

Appendix B-2: As-Reported and Adjusted Earnings Variance Analysis (c), (d)

Year-to-date 2021 vs. 2020

(After-tax, per share in $)

Utility Parent & Other EWC Consolidated

As- Adjusted As- Adjusted As- As- Adjusted Reported Reported Reported Reported

2020 earnings 3.31 3.31 (0.79) (0.79) (0.13) 2.39 2.52(loss)

Operatingrevenue less:

Fuel,fuel-relatedexpenses and

gas purchased 1.43 1.43 (e) - - (0.60) (f) 0.83 1.43for resale,

Purchasedpower, and

Regulatorycharges(credits)-net

Nuclearrefueling 0.02 0.02 - - 0.01 0.03 0.02outage expense

Other O&M (0.52) (0.52) (g) - - 0.35 (h) (0.17) (0.52)

Assetwrite-offs and - - - - (1.31) (i) (1.31) -impairments

Decommissioning (0.02) (0.02) - - 0.03 0.01 (0.02)expense

Taxes otherthan income (0.02) (0.02) - - 0.09 (o) 0.07 (0.02)taxes

Depreciation/amortization (0.24) (0.24) (k) - - 0.13 (p) (0.11) (0.24)exp.

Other income(deductions) (0.06) (0.06) (l) 0.04 0.04 0.26 (m) 0.24 (0.02)-other

Interest exp.and other (0.09) (0.09) (q) 0.01 0.01 0.01 (0.07) (0.08)charges

Income (0.42) (0.42) (r) 0.16 0.16 (n) (0.02) (0.28) (0.26)taxes-other

Preferreddividend - - - - - - -requirements

Share effect - - - - - - -

2021 earnings 3.39 3.39 (0.58) (0.58) (1.18) 1.63 2.81(loss)

Calculations may differ due to rounding

Utility operating revenue / regulatory charges and Utility income taxes-other exclude $14 million in second quarter 2021 and $15 million in(c) second quarter 2020 for the return of unprotected excess ADIT to customers (net effect is neutral to earnings). On a year-to-date basis, Utility operating revenue / regulatory charges and Utility income taxes-other exclude $54 million in 2021 and $45 million in 2020 for the return of unprotected excess ADIT to customers (net effect is neutral to earnings).

EPS effect is calculated by multiplying the pre-tax amount by the estimated income tax rate that is expected to apply and dividing by diluted average(d) number of common shares outstanding for the prior period; income taxes-other represents income tax differences other than the tax effect of individual line items.

The second quarter and year-to-date earnings increases were driven by higher volume/weather, including recovery from COVID-19; E-LA's FRP; E-TX's GCRR, TCRF and DCRF; E-NO NOPS recovery; and E-MS's FRP. The variance also reflected a regulatory credit for E-MS, primarily for its 2020 lookback evaluation, a reserve adjustment for the FERC MSS-4 ROE decision, higher Grand Gulf revenue due primarily to improved capacity factors (earnings(e) neutral), as well as regulatory credits for the difference between decommissioning expenses and decommissioning trust earnings plus decommissioning costs collected in revenue (largely earnings neutral, offset in Utility other income (deductions)-other). The year-to-date variance also reflected recovery of the Lake Charles Power Station, the reversal of a regulatory provision for E-AR's 2019 netting adjustment (which was subsequently adjusted), and a first quarter 2020 regulatory liability for tax sharing with E-LA customers (partially offsets the Hurricane Isaac Act 55 income tax item discussed in footnote r).

(f) The second quarter and year-to-date earnings decreases were due largely to lower revenues from the shutdown of Indian Point 2 in April 2020 and Indian Point 3 in April 2021.

The second quarter and year-to-date earnings decreases from higher Utility other O&M were due primarily to higher non-nuclear generation expenses related to timing and scope of outages and new plants placed in service,(g) higher nuclear generation expenses; higher distribution expenses, including higher reliability and vegetation costs; higher benefits costs, primarily health claims activity; and the impact of DOE awards recorded in second quarter 2020. Higher information technology costs as well as higher contract costs related to new customer initiatives also contributed. The year-to-date decrease also reflects lower nuclear insurance refunds.

The second quarter and year-to-date earnings increases from lower EWC other(h) O&M were due largely to the shutdown of Indian Point 2 in April 2020 and Indian Point 3 in April 2021, as well as lower severance and retention expenses.

The second quarter and year-to-date earnings decreases from higher EWC(i) asset write-offs and impairments were due primarily to a $340 million ($268 million net-of-tax) loss which resulted from the sale of Indian Point in May 2021.

(j) The second quarter earnings increase from lower EWC decommissioning expense was due to the sale of Indian Point in May 2021.

(k) The second quarter and year-to-date earnings decreases from higher Utility depreciation expense were due primarily to higher plant in service, including MCPS. The year-to-date decrease also reflected LCPS.

The second quarter and year-to-date earnings decreases from lower Utility(l) other income (deductions)-other were due largely to changes in decommissioning trust fund returns (based on regulatory treatment, decommissioning-related variances are largely earnings neutral), as well as lower AFUDC as a result of higher construction work in progress in 2020.

The second quarter earnings decrease from lower EWC other income (deductions)-other and the year-to-date earnings increase from higher EWC(m) other income (deductions)-other were due largely to the performance of nuclear decommissioning trust fund investments. The transfer of investments in May 2021 as part of the sale of Indian Point also contributed to the variances.

The second quarter earnings increase from Parent & Other income taxes-other reflected a reversal of a $9 million valuation allowance related to the(n) interest expense limitation. The year-to-date increase also reflected $23 million of income tax expense recorded in first quarter 2020 as a result of the IRS settlement related to the Hurricane Isaac Act 55 financing (discussed in footnote r).

(o) The year-to-date earnings increase from lower EWC taxes other than income taxes was due primarily to the shutdown of Indian Point 2 in April 2020 and Indian Point 3 in April 2021.

(p) The year-to-date earnings increase from lower EWC depreciation expense was due primarily to the shutdown of Indian Point 2 in April 2020 and Indian Point 3 in April 2021.

(q) The year-to-date earnings decrease from higher Utility interest expense was due primarily to higher debt balances at E-LA and E-MS.

The year-to-date earnings decrease from Utility income taxes-other primarily relates to two first quarter 2020 items. First, a $55 million tax(r) benefit was recorded in first quarter 2020 as a result of an IRS settlement related to Act 55 financing of Hurricane Isaac costs (partly offset by customer sharing, discussed in footnote e); and second, an annual tax accrual related to stock-based compensation resulted in a $22 million income tax benefit in first quarter 2020.

Utility as-reported operating revenue less fuel, fuel-relatedexpenses and gas purchased for resale; purchased power; and regulatory charges (credits) variance analysis 2021 vs. 2020 ($ EPS)

2Q YTD

Volume/weather 0.040.40

Retail electric price 0.200.48

Reg. provision for E-AR FRP - 0.16

Reg. liability for tax sharing - 0.10

Reg. credit for E-MS 0.070.07

MSS-4 ROE reserve adjustment 0.050.05

Other, including reg. credit for decommissioning 0.280.17 items and Grand Gulf recovery

Total 0.641.43

C: Utility Financial and Operating MeasuresAppendix C provides comparative summaries of Utility operating and financial measures.



Appendix C: Utility Operating and Financial Measures

Second Quarter and Year-to-Date 2021 vs. 2020

Second Quarter Year-to-Date

% % Weather % % Weather 2021 2020 ChangeAdjusted 2021 2020 ChangeAdjusted (s) (s)

GWh billed

Residential 7,361 7,759 (5.1) (2.9) 16,961 15,885 6.8 (0.2)

Commercial 6,370 6,070 4.9 6.4 12,504 12,315 1.5 1.0

Governmental602 570 5.6 6.9 1,181 1,165 1.4 2.4

Industrial 12,690 11,8477.1 7.1 24,148 23,662 2.1 2.1

Total retail27,023 26,2463.0 4.0 54,794 53,027 3.3 1.1 sales

Wholesale 4,716 3,111 51.6 9,016 6,228 44.8

Total sales 31,739 29,3578.1 63,810 59,255 7.7



Number of electric retail customers

Residential 2,542,2642,517,7181.0

Commercial 362,681 362,812 (0.0)

Governmental 17,867 17,940 (0.4)

Industrial 43,282 42,033 3.0

Total retail 2,966,0942,940,5030.9 customers



Other O&M and refueling $22.81 $21.197.6 $21.29 $20.69 2.9 outage expense per MWh



Calculations may differ due to rounding (s) The effects of weather were estimated using heating degree days and cooling degree days for the billing cycles from certain locations within each jurisdiction and comparing to "normal" weather based on 20-year historical data. The models used to estimate weather are updated periodically and are subject to change.



On a weather-adjusted basis billed retail sales increased 4.0 percent driven by reduced impacts from COVID-19. Residential billed sales decreased (2.9) percent and commercial billed sales increased 6.4 percent. Industrial billed sales volume increased 7.1 percent reflecting continued growth from new/expansion customers, higher sales to cogeneration customers, and higher sales to existing large and small customers partially due to reduced COVID-19 impacts and economic recovery.

D: EWC Financial and Operating MeasuresAppendix D-1 provides a comparative summary of EWC adjusted EBITDA (non-GAAP).

Appendix D-1: EWC Adjusted EBITDA - Reconciliation of GAAP to Non-GAAP Measures

Second Quarter and Year-to-Date 2021 vs. 2020

($ in millions) Second Quarter Year-to-Date

2021 2020 Change 2021 2020 Change

Net income (loss) (275) 85 (360) (237) (25) (211)

Add back: interest expense 4 7 (3) 8 12 (4)

Add back: income taxes (72) 24 (96) (56) (6) (50)

Add back: depreciation and amortization 14 25 (11) 27 60 (33)

Subtract: interest and investment income 50 207 (157) 97 35 63

Add back: decommissioning expense 40 51 (12) 93 102 (9)

Adjusted EBITDA (non-GAAP) (338) (15) (323) (262) 108 (370)

Calculations may differ due to rounding

Appendix D-2 provides a comparative summary of EWC operating and financial measures.

Appendix D-2: EWC Operating and Financial Measures

Second Quarter and Year-to-Date 2021 vs. 2020

Second Quarter Year-to-Date

2021 2020 % 2021 2020 % Change Change

Owned capacity (MW) (t) 1,205 2,246 (46.3) 1,205 2,246 (46.3)

GWh billed 2,687 4,958 (45.8) 7,099 11,714(39.4)



EWC Nuclear Fleet

Capacity factor 94% 96% (2.1) 97% 98% (0.6)

GWh billed 2,356 4,580 (48.5) 6,344 10,839(41.5)

Production cost per MWh $27.51$19.4541.4 $21.82$17.1327.4

Average energy/capacity revenue $48.89$37.5530.2 $50.87$43.8416.0 per MWh



Calculations may differ due to rounding (t) 2021 is lower due to the shutdown of IP3 (1,041MW) on April 30, 2021.

See the appendix in the webcast presentation for EWC hedging and price disclosures.

E: Consolidated Financial MeasuresAppendix E provides comparative financial measures. Financial measures in this table include those calculated and presented in accordance with GAAP, as well as those that are considered non-GAAP financial measures.

Appendix E: GAAP and Non-GAAP Financial Measures

Second Quarter 2021 vs. 2020 (See Appendix G for reconciliation of GAAP to non-GAAP financial measures)



For 12 months ending June 30 2021 2020 Change

GAAP Measures

As-reported ROIC 5.4% 5.9% (0.5%)

As-reported ROE 11.6% 12.2% (0.6%)



Non-GAAP Financial Measures

Adjusted ROIC 5.3% 5.6% (0.3%)

Adjusted ROE 11.3% 11.4% (0.1%)



As of June 30 ($ in millions, except where noted) 2021 2020 Change

GAAP Measures

Cash and cash equivalents 687 935 (249)

Available revolver capacity 4,125 4,110 16

Commercial paper 866 1,946 (1,080)

Total debt 25,43521,4933,942

Securitization debt 114 232 (118)

Debt to capital 69.5% 66.8% 2.7%

Off-balance sheet liabilities:

Debt of joint ventures - Entergy's share 12 51 (39)

Total off-balance sheet liabilities 12 51 (39)



Storm escrow balances 72 373 (301)



Non-GAAP Financial Measures ($ in millions, except where noted)

Debt to capital, excluding securitization debt 69.4% 66.6% 2.8%

Net debt to net capital, excluding securitization debt 68.9% 65.6% 3.3%

Gross liquidity 4,812 5,045 (233)

Net liquidity 3,946 3,099 847

Net liquidity, including storm escrow balances 4,018 3,472 546

Parent debt to total debt, excluding securitization 22.4% 22.0% 0.4% debt

FFO to debt, excluding securitization debt 8.3% 14.6% (6.3%)

FFO to debt, excluding securitization debt, return of unprotected excess ADIT, and severance and retention 9.3% 16.0% (6.7%) payments associated with exit of EWC



Calculations may differ due to rounding

F: Definitions and Abbreviations and AcronymsAppendix F-1 provides definitions of certain operating measures, as well as GAAP and non-GAAP financial measures.

Appendix F-1: Definitions

Utility Financial and Operating Measures

GWh billed Total number of GWh billed to retail and wholesale customers

Number of electric Average number of electric customers over the periodretail customers

Other O&M and Other operation and maintenance expense plus nuclearrefueling outage refueling outage expense per MWh of billed salesexpense per MWh

EWC Financial and Operating Measures

Adjusted EBITDA Earnings before interest, income taxes, and depreciation(non-GAAP) and amortization, and excluding decommissioning expense

Revenue on a per unit basis at which generation output reflected in contracts is expected to be sold to third parties (including offsetting positions) at the minimumAverage revenue per contract prices and at forward market prices at a point inMWh on contracted time, given existing contract or option exercise pricesvolumes based on expected dispatch or capacity, excluding the revenue associated with the amortization of the below-market PPA for Palisades (revenue will fluctuate due to factors including positive or negative basis differentials and other risk management costs)

Average revenueunder contract per Revenue on a per unit basis at which capacity is expectedkW-month (applies to to be sold to third parties, given existing contractcapacity contracts prices and/or auction awardsonly)

Bundled capacity and A contract for the sale of installed capacity and relatedenergy contracts energy, priced per MWh sold

Capacity factor Normalized percentage of the period that the nuclear plants generate power

Total energy and capacity revenue on a per unit basis at which total planned generation output and capacity isExpected sold and expected to be sold given contract terms and market pricesmarket total revenue at a point in time, including positive or negative basisper MWh differentials and other risk management costs, divided by total planned MWh of generation, excluding the revenue associated with the amortization of the Palisades below-market PPA

GWh billed Total number of GWh billed to customers and financially-settled instruments

Owned capacity (MW) Installed capacity owned by EWC

Percent of capacity Percent of planned qualified capacity sold to mitigatesold forward price uncertainty under physical or financial transactions

Percent of plannedgeneration under Percent of planned generation output sold undercontract (unit unit-contingent contractscontingent)

Planned net MW in Average installed nuclear capacity to generate power and/operation (average) or sell capacity, reflecting the shutdown of Palisades (May 31, 2022)

Planned TWh of Amount of output expected to be generated by EWC nucleargeneration resources considering plant operating characteristics, reflecting the shutdown of Palisades (May 31, 2022)

Production cost per Fuel and other O&M expenses according to accountingMWh standards that directly relate to the production of electricity per MWh (based on net generation)

Appendix F-1: Definitions (continued)

EWC Financial and Operating Measures (continued)

Transaction under which power is supplied from a specific generation asset; if the asset is inUnit contingent operational outage, seller is generally not liable to buyer for any damages, unless the contract specifies certain conditions such as an availability guarantee

Financial Measures - GAAP

12-months rolling net income attributable toAs-reported ROE Entergy Corporation divided by avg. common equity

12-months rolling net income attributable toAs-reported ROIC Entergy Corporation adjusted for preferred dividends and tax-effected interest expense divided by average invested capital

Debt of joint ventures - Entergy's share of debt issued by businessEntergy's share joint ventures at EWC

Debt to capital Total debt divided by total capitalization

Available revolver capacity Amount of undrawn capacity remaining on corporate and subsidiary revolvers

Debt on the balance sheet associated withSecuritization debt securitization bonds that is secured by certain future customer collections

Sum of short-term and long-term debt, notesTotal debt payable and commercial paper, and finance leases on the balance sheet

Financial Measures - Non-GAAP

Adjusted EPS As-reported EPS excluding adjustments

12-months rolling adjusted net incomeAdjusted ROE attributable to Entergy Corporation divided by average common equity

12-months rolling adjusted net income attributable to Entergy Corporation adjustedAdjusted ROIC for preferred dividends and tax-effected interest expense divided by average invested capital

Unusual or non-recurring items or events or other items or events that management believes do not reflect the ongoing business of Entergy,Adjustments such as the results of the EWC segment, significant tax items, and other items such as certain costs, expenses, or other specified items

Debt to capital, excluding Total debt divided by total capitalization,securitization debt excluding securitization debt

OCF less AFUDC-borrowed funds, working capital items in OCF (receivables, fuel inventory,FFO accounts payable, taxes accrued, interest accrued, and other working capital accounts), and securitization regulatory charges

FFO to debt, excluding 12-months rolling FFO as a percentage of end ofsecuritization debt period total debt excluding securitization debt

FFO to debt, excl. 12-months rolling FFO excluding return ofsecuritization debt, return of unprotected excess ADIT and severance andunprotected excess ADIT, and retention payments associated with exit ofseverance and retention EWC as a percentage of end of period total debtpayments associated with exit excluding securitization debtof EWC

Gross liquidity Sum of cash and available revolver capacity

Net debt to net capital, excl. Total debt less cash and cash equivalentssecuritization debt divided by total capitalization less cash and cash equivalents, excluding securitization debt

Net liquidity Sum of cash and available revolver capacity less commercial paper borrowing

Net liquidity, including storm Sum of cash, available revolver capacity, andescrows escrow accounts available for certain storm expenses, less commercial paper borrowing

Entergy Corp. debt, incl. amounts drawn onParent debt to total debt, credit revolver and commercial paperexcl. securitization debt facilities, as a percent of consolidated total debt, excl. securitization debt

Appendix F-2 explains abbreviations and acronyms used in the quarterly earnings materials.

Appendix F-2: Abbreviations and Acronyms

ADIT Accumulated deferred income taxes IRP Integrated resource plan

AFUDC Allowance for funds used during IRS Internal Revenue construction Service

AFUDC - Allowance for borrowed funds used Unit 2 of Independenceborrowed during construction ISES 2 Steam Electric Stationfunds (coal)

AG Attorney General ISO Independent system operator

ALJ Administrative law judge LCPS Lake Charles Power Station (CCGT)

AMI Advanced metering infrastructure LLS Light Louisiana Sweet crude

ANO Units 1 and 2 of Arkansas Nuclear LPSC Louisiana Public One owned by E-AR (nuclear) Service Commission

APSC Arkansas Public Service Commission LTM Last twelve months

ARO Asset retirement obligation MCPS Montgomery County Power Station (CCGT)

Midcontinentbps Basis points MISO Independent System Operator, Inc.

CCGT Combined cycle gas turbine Moody's Moody's Investor Service

CCN Certificate of convenience and MPSC Mississippi Public necessity Service Commission

CCNO Council of the City of New Orleans MT Metric tons

Choctaw Choctaw County Generating Station MTEP MISO Transmission (CCGT) Expansion Plan

COD Commercial operation date Nelson 6 Unit 6 of Roy S. Nelson plant (coal)

CT Simple cycle combustion turbine NDT Nuclear decommissioning trust

CWIP Construction work in progress NGO Non-governmental organization

DCRF Distribution cost recovery factor NOPA IRS Notice of Proposed Adjustment

DOE U.S. Department of Energy NOPS New Orleans Power Station

DSM Demand side management NOSS New Orleans Solar Station

E-AR Entergy Arkansas, LLC NRC U.S. Nuclear Regulatory Commission

E-LA Entergy Louisiana, LLC NYSE New York Stock Exchange

E-MS Entergy Mississippi, LLC OCAPS Orange County Advanced Power Station

Net cash flow providedE-NO Entergy New Orleans, LLC OCF by operating activities

E-TX Entergy Texas, Inc. OpCo Utility operating company

Earnings before interest, income Other post-employmentEBITDA taxes, and depreciation and OPEB benefits amortization

Other non-fuelEEI Edison Electric Institute Other O&M operation and maintenance expense

ENP Entergy Nuclear Palisades, LLC P&O Parent & Other

EPS Earnings per share Palisades Palisades Power Plant (nuclear)

ETR Entergy Corporation PMR Performance Management Rider

Power purchaseEWC Entergy Wholesale Commodities PPA agreement or purchased power agreement

FERC Federal Energy Regulatory Commission PSC Public service commission

FFO Funds from operations PUCT Public Utility Commission of Texas

FASB Interpretation No.48,FIN 48 "Accounting for Uncertainty in PVC Polyvinyl chloride Income Taxes"

FRP Formula rate plan RICE Reciprocating internal combustion engine

GAAP U.S. generally accepted accounting RFP Request for proposals principles

GCRR Generation Cost Recovery Rider ROE Return on equity

Grand Unit 1 of Grand Gulf Nuclear Station Return on investedGulf or (nuclear), 90% owned or leased by ROIC capitalGGNS SERI

IIRR-G Infrastructure investment recovery RS Cogen RS Cogen facility rider - gas (CCGT cogeneration)

Indian Indian Point Energy Center Unit 2 Rate StabilizationPoint 2 (nuclear) (shut down April 30, 2020, RSP Plan (E-LA Gas)or IP2 sold May 28,2021)

Indian Indian Point Energy Center Unit 3Point 3 (nuclear) (shut down April 30, 2021, S&P Standard & Poor'sor IP3 sold May 28, 2021)

IPEC or Indian Point Energy Center (nuclear) U.S. Securities andIndian (sold May 28, 2021) SEC Exchange CommissionPoint

SERI System Energy Resources, Inc.

TCRF Transmission cost recovery factor

UPSA Unit Power Sales Agreement

WACC Weighted-average cost of capital

WPEC Washington Parish Energy Center

G: Other GAAP to Non-GAAP ReconciliationsAppendix G-1, Appendix G-2, and Appendix G-3 provide reconciliations of various non-GAAP financial measures disclosed in this news release to their most comparable GAAP measure.

Appendix G-1: Reconciliation of GAAP to Non-GAAP Financial Measures - ROIC, ROE

(LTM $ in millions except where noted) Second Quarter

2021 2020

As-reported net income (loss) attributable to Entergy (A) 1,238 1,230Corporation

Preferred dividends 18 18

Tax-effected interest expense 600 574

As-reported net income (loss) attributable to EntergyCorporation adjusted for preferred dividends and (B) 1,856 1,822tax-effected interest expense

Adjustments (C) 32 80

EWC preferred dividends and tax-effected interest expense 17 21included in adjustments

Total adjustments, excluding EWC preferred dividends and 49 101tax-effected interest expense (non-GAAP) (D)

Adjusted earnings (non-GAAP) (A-C) 1,206 1,150

Adjusted earnings, excluding preferred dividends and tax- (B-D) 1,807 1,721effected interest expense (non-GAAP)

Average invested capital (average of beginning and ending 34,375 30,622balances) (E)

Average common equity (average of beginning and ending 10,657 10,112balances) (F)

As-reported ROIC (B/E) 5.4% 5.9%

Adjusted ROIC (non-GAAP) [(B-D) 5.3% 5.6% /E]

As-reported ROE (A/F) 11.6% 12.2%

Adjusted ROE (non-GAAP) [(A-C) 11.3% 11.4% /F]

Calculations may differ due to rounding

Appendix G-2: Reconciliation of GAAP to Non-GAAP Financial Measures - Debtratios excluding securitization debt; gross liquidity; net liquidity; netliquidity, including storm escrows

($ in millions except where noted) Second Quarter

2021 2020

Total debt (A) 25,435 21,493

Less securitization debt (B) 114 232

Total debt, excluding securitization debt (C) 25,321 21,261

Less cash and cash equivalents (D) 687 935

Net debt, excluding securitization debt (E) 24,634 20,326

Commercial paper (F) 866 1,946

Total capitalization (G) 36,577 32,173

Less securitization debt (B) 114 232

Total capitalization, excluding securitization debt (H) 36,463 31,941

Less cash and cash equivalents (D) 687 935

Net capital, excluding securitization debt (I) 35,777 31,006

Debt to capital (A/G) 69.5% 66.8%

Debt to capital, excluding securitization debt (C/H) 69.4% 66.6%(non-GAAP)

Net debt to net capital, excluding securitization debt (E/I) 68.9% 65.6%(non-GAAP)

Available revolver capacity (J) 4,125 4,110

Storm escrows (K) 72 373

Gross liquidity (non-GAAP) (D+J) 4,812 5,045

Net liquidity (non-GAAP) (D+J-F) 3,946 3,099

Net liquidity, including storm escrows (non-GAAP) (D+J-F+K) 4,018 3,472

Entergy Corporation notes:

Due July 2022 650 650

Due September 2025 800 750

Due September 2026 750 600

Due June 2028 650 600

Due June 2030 600 -

Due June 2031 650 -

Due June 2050 600 -

Total Entergy Corporation notes (L) 4,700 2,600

Revolver draw (M) 150 160

Unamortized debt issuance costs and discounts (N) (52) (32)

Total parent debt (F+L+M+N) 5,664 4,675

Parent debt to total debt, excluding securitization [(F+L+M+N) 22.4% 22.0%debt (non-GAAP) /C]

Calculations may differ due to rounding

Appendix G-3: Reconciliation of GAAP to Non-GAAP Financial Measures - FFO todebt, excluding securitization debt; FFO to debt, excluding securitizationdebt, return of unprotected excess ADIT, and severance and retention paymentsassociated with exit of EWC

($ in millions except where noted) Second Quarter

2021 2020

Total debt (A) 25,435 21,493

Less securitization debt (B) 114 232

Total debt, excluding securitization debt (C) 25,321 21,261

(D)Net cash flow provided by operating activities, LTM 1,988 3,212

AFUDC - borrowed funds, LTM (E) (38) (58)

Working capital items in net cash flow provided byoperating activities, LTM:

Receivables (263) (5)

Fuel inventory 9 (35)

Accounts payable 45 (92)

Taxes accrued 93 62

Interest accrued 3 5

Other working capital accounts (166) (15)

Securitization regulatory charges, LTM 119 123

Total (F) (159) 43

FFO, LTM (non-GAAP) (G)= 2,109 3,110 (D+E-F)

FFO to debt, excluding securitization debt (non-GAAP) (G/C) 8.3% 14.6%

Estimated return of unprotected excess ADIT, LTM (H) 83 189

Severance and retention payments associated with exit of (I) 160 102EWC, LTM pre-tax

FFO to debt, excluding securitization debt, return of [(G+H+I)unprotected excess ADIT, and severance and retention /(C)] 9.3% 16.0%payments associated with exit of EWC (non-GAAP)

Calculations may differ due to rounding

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SOURCE Entergy Corporation