- Strong third quarter 2024 financial and operating results;
reaffirming recently raised 2024 guidance
- Increasing 2024 share repurchase plan to $925 million, and
on target to achieve investment grade credit metrics by the end of
2024
- Initiating 2025 financial guidance with long-term Adjusted
Earnings per Share (Adjusted EPS) growth target of greater than 10%
from raised 2024 guidance
- Announcing 2025 capital allocation with $1.355 billion of
share repurchases; share repurchase authorization increased by $1
billion to $3.7 billion through 2025
- Partnering with Renew Home and Google Cloud to create and
operationalize 1 GW of Virtual Power Plant platform capacity in
Texas
- New build: 415 MW T.H. Wharton peaking generation facility
near Houston, selected by the Texas Energy Fund to proceed to due
diligence
NRG Energy, Inc. (NYSE: NRG) today reports strong third quarter
2024 financial results and reaffirms its raised guidance
ranges.
“We had another excellent quarter, posting strong performance
across the company,” said Larry Coben, NRG Chair, President and
Chief Executive Officer. “NRG's financial position has never been
stronger as evidenced by our raised 2024 guidance and the 2025
guidance we initiated today. We continue to look to add new
capacity to our portfolio, and our exciting new partnership with
Renew Home provides further validation of our customer-focused
strategy.”
Consolidated Financial
Results
Table 1:
Three Months Ended
Nine Months Ended
($ in millions, except per share
amounts)
9/30/2024
9/30/2023
9/30/2024
9/30/2023
Net (Loss)/Income
$
(767
)
$
343
$
482
$
(684
)
(Loss)/Income per Weighted Average Common
Share — Basic
$
(3.79
)
$
1.42
$
2.08
$
(3.14
)
Adjusted EBITDAa
$
1,055
$
987
$
2,887
$
2,458
Adjusted Net Incomeb
$
393
$
360
$
1,066
$
849
Adjusted EPSc
$
1.90
$
1.57
$
5.15
$
3.69
Cash Provided/(Used) by Operating
Activities
$
31
$
566
$
1,354
$
(462
)
Free Cash Flow Before Growth Investments
(FCFbG)
$
815
$
355
$
1,438
$
983
a Adjusted EBITDA recast to exclude all
impacts of amortization of capitalized contract costs related to
fulfillment, now reflected in depreciation and amortization
referenced below
b Not previously provided, Adjusted Net
Income as shown here is ‘Adjusted Net Income available for common
stockholders’; see appendix tables A-1-A-6
c Not previously provided, Adjusted EPS
calculated based on Adjusted Net Income divided by weighted average
number of common shares outstanding - basic
For the third quarter of 2024, GAAP Net Loss was $(767) million
as a result of the impact of unrealized non-cash mark-to-market
losses on commodity hedges, and GAAP Cash Provided by Operating
Activities was $31 million. NRG produced Adjusted EBITDA of $1,055
million and Free Cash Flow before Growth Investments of $815
million in the quarter, an increase of $68 million and $460
million, respectively, over the same period in the prior year.
Year-over-year improved financial performance was driven primarily
by margin expansion across all NRG reporting segments.
Introduction of Adjusted Net Income and
Adjusted EPS Metrics
NRG is introducing new metrics to enhance its financial
reporting. Adjusted Net Income and Adjusted EPS offer additional
insight into the performance of the Company, and highlight the
maturity and predictability of NRG's integrated platform and robust
capital return program. The Company will continue to report and
provide guidance on Adjusted EBITDA and FCFbG alongside Adjusted
Net Income and Adjusted EPS to ensure transparency and to allow for
continuity of analysis.
Adjusted Net Income and Adjusted EPS are both non-GAAP measures.
The Company defines Adjusted EPS as the Adjusted Net Income
available to common shareholders, divided by the weighted average
number of basic common shares outstanding. With the retirement of
the callable and fully hedged Convertible Senior Notes scheduled to
occur in 2025, the weighted average number of basic common shares
outstanding will provide a more accurate view of recurring
per-share earnings.
The Company calculates Adjusted Net Income and Adjusted EPS
metrics using an adjusted effective tax rate. Actual cash taxes are
materially lower than book income tax expense due to NRG's tax
attributes, primarily comprised of sizable gross Net Operating
Losses (NOL), which are forecasted to be $7.2 billion as of
December 31, 2024.
The Company has also recast all amortization of capitalized
customer acquisition costs from selling general &
administrative expenses and cost of operations into the
depreciation and amortization line item of the Company's financial
statements. All reported figures have been updated to reflect this
change, and historical periods have been recast to aid with
comparison. This recast only affects Adjusted EBITDA and has no
impact on Adjusted Net Income, Adjusted EPS, or FCFbG.
Raised 2024 Guidance
On September 25, 2024, NRG raised its 2024 Adjusted EBITDA
guidance to $3,525 - $3,675 million from $3,300 - $3,550 million
and FCFbG guidance to $1,975 - $2,125 million from $1,825 - $2,075
million. With the recasting of the amortization of capitalized
customer acquisition costs described above, the 2024 Adjusted
EBITDA guidance issued on September 25, 2024 is now $3,655 - $3,805
million, an increase of $130 million. 2024 FCFbG guidance is not
changed by the recasting of capitalized contract costs which are
non-cash items.
NRG is also providing 2024 ranges for Adjusted Net Income and
Adjusted EPS of $1,235 - $1,385 and $5.95 - $6.75, respectively. In
the third quarter 2024, the Company earned $393 million of Adjusted
Net Income and $1.90 of Adjusted EPS.
Table 2: Adjusted EBITDA, Adjusted Net
Income, Adjusted EPS, and FCFbG Guidance for 2024a
2024
2024
($ in millions, except per share
amounts)
Original Guidance
Raised Guidance
Adjusted EBITDAb
$3,430 - $3,680
$3,655 - $3,805
Adjusted Net Incomec
$1,040 - $1,290
$1,235 - $1,385
Adjusted EPSd
$5.00 - $6.30
$5.95 - $6.75
FCFbG
$1,825 - $2,075
$1,975 - $2,125
a Adjusted EBITDA, Adjusted Net Income,
Adjusted EPS and FCFbG are non-GAAP financial measures; see
Appendix Tables A-10-A-12 for GAAP Reconciliation. Adjusted EBITDA,
Adjusted Net Income and Adjusted EPS exclude fair value adjustments
related to derivatives. The Company does not guide to GAAP Net
Income due to the impact of such fair value adjustments related to
derivatives in a given year
b Adjusted EBITDA recast to exclude all
impacts of amortization of capitalized contract costs related to
fulfillment, now reflected in depreciation and amortization
c Not previously provided, Adjusted Net
Income as shown here is ‘Adjusted Net Income available for common
stockholders’; see appendix table A-10 and A-11 for GAAP
Reconciliations
d Not previously provided, Adjusted EPS
calculated based on Adjusted Net Income divided by forecasted
weighted average number of common shares outstanding - basic
2024 Capital Allocation
NRG reaffirms its capital allocation policy targeting
approximately 80% of recurring cash available for allocation after
debt reduction to return of capital, and approximately 20% to
strategic growth. The Company is increasing its share repurchase
allocation for 2024 from $825 million to $925 million. Through the
third quarter of 2024, the Company continued to repurchase shares
in the open market, with $544 million completed as of October 31,
2024. The Company expects to complete the entire $925 million of
2024 repurchases near the end of the fourth quarter.
As of September 30, 2024, NRG has executed approximately $1.6
billion of debt reduction since the closing of the Vivint
acquisition in March 2023. The Company had set a goal of achieving
investment grade credit metrics by the end of 2025, and as a result
of its strategic liability management plan and financial
out-performance, NRG is on track to achieve its target by the end
of 2024, a full year earlier than the original target.
On October 11, 2024, the Board of Directors declared a quarterly
dividend on the Company's common stock of $0.4075 per share, or
$1.63 per share on an annualized basis. The dividend is payable on
November 15, 2024, to stockholders of record as of November 1,
2024.
Initiating 2025 Guidance and Capital
Allocation Plan
NRG initiates 2025 guidance as follows:
Table 3: Adjusted EBITDA, Adjusted Net
Income, Adjusted EPS, and FCFbG Guidance for 2025a
2024
2025
2025
($ in millions, except per share
amounts)
Raised Guidance
Guidance
Guidance Midpoint
Adjusted EBITDAb
$3,655 - $3,805
$3,725 - $3,975
$3,850
Adjusted Net Incomec
$1,235 - $1,385
$1,330 - $1,530
$1,430
Adjusted EPSd
$5.95 - $6.75
$6.75 - $7.75
$7.25
FCFbG
$1,975 - $2,125
$1,975 - $2,225
$2,100
a Adjusted EBITDA, Adjusted Net Income,
Adjusted EPS and FCFbG are non-GAAP financial measures; see
Appendix Tables A-10-A-12 for GAAP Reconciliation. Adjusted EBITDA,
Adjusted Net Income and Adjusted EPS exclude fair value adjustments
related to derivatives. The Company does not guide to GAAP Net
Income due to the impact of such fair value adjustments related to
derivatives in a given year
b Adjusted EBITDA recast to exclude all
impacts of amortization of capitalized contract costs related to
fulfillment, now reflected in depreciation and amortization
c Not previously provided, Adjusted Net
Income as shown here is ‘Adjusted Net Income available for common
stockholders’; see appendix table A-10 and A-11 for GAAP
Reconciliation
d Not previously provided, Adjusted EPS
calculated based on Adjusted Net Income divided by forecasted
weighted average number of common shares outstanding - basic
The year-over-year increases in the guidance ranges reflect
continued improved execution across all of NRG's businesses, and
the expected achievement of NRG's previously announced revenue and
cost synergy programs which more than offset the loss of Airtron's
financial contribution due to the sale of the business. The
guidance ranges reflect a flat power price environment and are not
dependent on tightening power markets or price speculation, and do
not include any potential contributions from sites, or other
similar opportunities.
The Company is also announcing its 2025 capital allocation plan
which adheres to its previously announced policy. The plan includes
$1.3 billion in share repurchases and an 8% increase of the annual
common dividend to $1.76 per share. NRG's Board of Directors has
approved an increase of the Company's share repurchase
authorization through 2025 to $3.7 billion from $2.7 billion.
NRG's share repurchase program and common stock dividend are
subject to maintaining satisfactory credit metrics, available
capital, market conditions, and compliance with associated laws and
regulations. The timing and amount of any shares of NRG’s common
stock repurchased under the share repurchase authorization will be
determined by NRG’s management based on market conditions and other
factors. NRG will only repurchase shares when management believes
it would not jeopardize the Company’s ability to maintain
satisfactory credit ratings.
Long-Term Adjusted EPS
Growth
NRG plans to deliver a long-term cumulative annual growth rate
(CAGR) for Adjusted EPS of greater than 10% measured from the
midpoint of its raised 2024 guidance. The Company projects this
long-term growth rate utilizing a flat power price environment and
is not dependent on tightening markets or power price speculation.
This projected growth rate also excludes potential earnings uplift
from the 21 sites and ERCOT natural gas new build projects not
selected by the Texas Energy Fund (TEF). Rather, the CAGR is
derived from the Company's organic growth plan comprised of
identified initiatives resulting in an incremental $750 million of
annual run-rate Adjusted EBITDA by 2029, and over $8 billion of
cumulative return of capital from 2025 through 2029.
Strategic Developments
Partnering with Renew Home and Google Cloud to Develop
Virtual Power Plant
NRG has entered into a definitive partnership agreement with
Renew Home, a leading Virtual Power Plant platform (VPP) formed by
the combination of Google's Nest Renew and OhmConnect. This
first-of-its-kind commercial partnership reinforces NRG's customer
focus and brings to market unique products and services which will
help customers save money while enjoying the benefits of a seamless
energy and smart home experience. Leveraging Google Cloud's AI and
cloud platforms, NRG and Renew Home plan to develop a VPP portfolio
of up to 1 GW of load management capacity, with instantaneous
dispatch value during peak events and tight supply conditions.
Participating customers will enroll in an NRG branded energy plan
and will be eligible for favorable rates on Vivint Smart Home
services and additional products. The partnership will initially
focus in Texas, with Renew Home supporting upfront customer
acquisition costs and Google Nest integration.
Texas Energy Fund
The Public Utilities Commission of Texas (PUCT) selected NRG's
415 MW new build of the T.H. Wharton peaking facility to move
forward through its next phase of diligence.
Airtron HVAC Sale
On September 16, 2024, NRG closed the sale of its HVAC business
unit Airtron for a purchase price of $500 million and net cash
proceeds of $484 million, with approximately $425 million expected
after taxes and fees. Airtron is a leading installer of HVAC
systems for residential new construction homes and was acquired as
part of the Direct Energy acquisition in 2021. The opportunistic
divestiture was completed at an accretive 8.6x multiple on 2023
Adjusted EBITDA.
Segments Results
Table 4: Net (Loss)/Income
($ in millions)
Three Months Ended
Nine Months Ended
Segment
9/30/2024
9/30/2023
9/30/2024
9/30/2023
Texas
$
(1,056
)
$
463
$
259
$
1,532
East
88
316
1,116
(1,187
)
West/Services/Othera
230
(432
)
(842
)
(963
)
Vivint Smart Homeb
$
(29
)
$
(4
)
$
(51
)
$
(66
)
Net (Loss)/Income
$
(767
)
$
343
$
482
$
(684
)
a Includes Corporate segment
b Vivint Smart Home acquired in March
2023
Net Loss for the third quarter of 2024 was $(767) million, $1.1
billion lower than the third quarter of 2023. This was primarily
driven by higher unrealized non-cash mark-to-market losses on
economic hedges in Texas in 2024 impacted by a decrease in ERCOT
forward power prices, partially offset by the gain on the sale of
Airtron recorded in September of 2024. Certain hedge positions are
required to be marked-to-market every period, while the customer
contracts related to these items are not, resulting in temporary
unrealized losses or gains on the economic hedges that are not
reflective of the expected economics at future settlement.
Table 5: Adjusted EBITDA
($ in millions)
Three Months Ended
Nine Months Ended
Segment
9/30/2024
9/30/2023
9/30/2024
9/30/2023
Texas
$
584
$
552
$
1,255
$
1,310
East
164
171
724
562
West/Services/Othera
50
25
179
51
Vivint Smart Homeb
$
257
$
239
$
729
$
535
Adjusted EBITDAc
$
1,055
$
987
$
2,887
$
2,458
a Includes Corporate segment
b Vivint Smart Home acquired in March
2023
c Adjusted EBITDA recast to exclude all
impacts of amortization of capitalized contract costs related to
fulfillment, now reflected in depreciation and amortization
Texas: Third quarter Adjusted EBITDA was $584 million,
$32 million higher than the third quarter of 2023. This increase
was a result of higher gross margin including lower supply costs
and higher revenue rates, partially offset by asset sales in
2023.
East: Third quarter Adjusted EBITDA was $164 million, $7
million lower than the third quarter of 2023. This decrease was
driven by higher operating expenses, partially offset by increased
retail natural gas margins and increased customer counts.
West/Services/Other: Third quarter Adjusted EBITDA was
$50 million, $25 million higher than the third quarter of 2023.
This increase was primarily driven by lower retail power supply
costs, partially offset by timing of outages at Cottonwood.
Vivint Smart Home: Third quarter Adjusted EBITDA was $257
million, $18 million higher than the third quarter of 2023. The 8%
increase was attributable to growth in subscriber count, an
increase in monthly recurring revenue per subscriber, and a
decrease in monthly recurring net service cost per subscriber.
Liquidity and Capital
Resources
Table 6: Corporate Liquidity
($ in millions)
9/30/24
12/31/23
Cash and Cash Equivalents
$
1,104
$
541
Restricted Cash
10
24
Total
1,114
565
Total Revolving Credit Facility and
collective collateral facilities
5,330
4,278
Total Liquidity, excluding collateral
deposited by counterparties
$
6,444
$
4,843
As of September 30, 2024, NRG's unrestricted cash was $1.1
billion and $5.3 billion was available under the Company’s credit
facilities. Total liquidity increased $1.6 billion from the end of
2023 to $6.4 billion, primarily due to an increase in availability
of $1.1 billion in the Receivables Facility and proceeds on hand
from the Airtron sale, partly offset by $210 million in other
facilities.
Earnings Conference Call
On November 8, 2024, NRG will host a conference call at 9:00
a.m. Eastern (8:00 a.m. Central) to discuss these results.
Investors, the news media and others may access the live webcast of
the conference call and accompanying presentation materials through
the investor relations website under “presentations and webcasts”
on investors.nrg.com. The webcast will be archived on the site for
those unable to listen in real-time.
About NRG
NRG Energy is a leading energy and home services company powered
by people and our passion for a smarter, cleaner, and more
connected future. A Fortune 500 company operating in the United
States and Canada, NRG delivers innovative solutions that help
people, organizations, and businesses achieve their goals while
also advocating for competitive energy markets and customer choice.
More information is available at www.nrg.com. Connect with NRG on
Facebook and LinkedIn, and follow us on X (formerly known as
Twitter), @nrgenergy.
Forward-Looking
Statements
In addition to historical information, the information presented
in this press release includes forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933 and
Section 21E of the Exchange Act. These statements involve
estimates, expectations, projections, goals, assumptions, known and
unknown risks and uncertainties and can typically be identified by
terminology such as “may,” “should,” “could,” “objective,”
“projection,” “forecast,” “goal,” “guidance,” “outlook,” “expect,”
“intend,” “seek,” “plan,” “think,” “anticipate,” “estimate,”
“predict,” “target,” “potential” or “continue” or the negative of
these terms or other comparable terminology. Such forward-looking
statements include, but are not limited to, statements about the
Company’s future revenues, income, indebtedness, capital structure,
plans, expectations, objectives, projected financial performance
and/or business results and other future events, and views of
economic and market conditions.
Although NRG believes that its expectations are reasonable, it
can give no assurance that these expectations will prove to be
correct, and actual results may vary materially. Factors that could
cause actual results to differ materially from those contemplated
herein include, among others, general economic conditions, hazards
customary in the power industry, weather conditions and extreme
weather events, competition in wholesale power, gas and smart home
markets, the volatility of energy and fuel prices, failure of
customers or counterparties to perform under contracts, changes in
the wholesale power and gas markets, changes in government or
market regulations, the condition of capital markets generally and
NRG’s ability to access capital markets, NRG’s ability to execute
its supply strategy, risks related to data privacy, cyberterrorism
and inadequate cybersecurity, the loss of data, unanticipated
outages at NRG’s generation facilities, NRG’s ability to achieve
its net debt targets, adverse results in current and future
litigation, complaints, product liability claims and/or adverse
publicity, failure to identify, execute or successfully implement
acquisitions or asset sales, risks of the smart home and security
industry, including risks of and publicity surrounding the sales,
subscriber origination and retention process, the impact of changes
in consumer spending patterns, consumer preferences, geopolitical
tensions, demographic trends, supply chain disruptions, NRG’s
ability to implement value enhancing improvements to plant
operations and company wide processes, NRG’s ability to achieve or
maintain investment grade credit metrics, NRG’s ability to proceed
with projects under development or the inability to complete the
construction of such projects on schedule or within budget, the
inability to maintain or create successful partnering
relationships, NRG’s ability to operate its business efficiently,
NRG’s ability to retain customers, the ability to successfully
integrate businesses of acquired companies, including Vivint Smart
Home, NRG’s ability to realize anticipated benefits of transactions
(including expected cost savings and other synergies) or the risk
that anticipated benefits may take longer to realize than expected,
NRG’s ability to execute its capital allocation plan. Achieving
investment grade credit metrics is not an indication of or
guarantee that the Company will receive investment grade credit
ratings. Debt and share repurchases may be made from time to time
subject to market conditions and other factors, including as
permitted by United States securities laws. Furthermore, any common
stock dividend is subject to available capital and market
conditions.
NRG undertakes no obligation to update or revise any
forward-looking statements, whether as a result of new information,
future events or otherwise, except as required by law. The Adjusted
EBITDA, cash provided by operating activities and Free Cash Flow
before Growth, Adjusted Net Income, and Adjusted EPS guidance are
estimates as of November 8, 2024. These estimates are based on
assumptions NRG believed to be reasonable as of that date. NRG
disclaims any current intention to update such guidance, except as
required by law. The foregoing review of factors that could cause
NRG’s actual results to differ materially from those contemplated
in the forward-looking statements included in this press release
should be considered in connection with information regarding risks
and uncertainties that may affect NRG's future results included in
NRG's filings with the Securities and Exchange Commission at
www.sec.gov. For a more detailed discussion of these factors, see
the information under the captions “Risk Factors” and “Management’s
Discussion and Analysis of Financial Condition and Results of
Operations” in NRG’s most recent Annual Report on Form 10-K, and in
subsequent SEC filings. NRG’s forward-looking statements speak only
as of the date of this communication or as of the date they are
made.
NRG ENERGY, INC. AND
SUBSIDIARIES
CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS
(Unaudited)
Three months ended
September 30,
Nine months ended
September 30,
(In millions, except for per share
amounts)
2024
2023
2024
2023
Revenue
Revenue
$
7,223
$
7,946
$
21,311
$
22,016
Operating Costs and Expenses
Cost of operations (excluding depreciation
and amortization shown below)
7,239
6,406
17,229
20,137
Depreciation and amortization
352
359
1,045
921
Impairment losses
—
—
15
—
Selling, general and administrative costs
(excluding amortization of customer acquisition costs of $55, $36,
$144 and $84, respectively, which are included in depreciation and
amortization shown separately above)
645
602
1,739
1,502
Acquisition-related transaction and
integration costs
7
18
22
111
Total operating costs and expenses
8,243
7,385
20,050
22,671
Gain on sale of assets
208
—
209
202
Operating (Loss)/Income
(812
)
561
1,470
(453
)
Other Income/(Expense)
Equity in earnings of unconsolidated
affiliates
6
6
13
16
Other income, net
5
14
38
43
Loss on debt extinguishment
—
—
(260
)
—
Interest expense
(213
)
(173
)
(528
)
(472
)
Total other expense
(202
)
(153
)
(737
)
(413
)
(Loss)/Income Before Income
Taxes
(1,014
)
408
733
(866
)
Income tax (benefit)/expense
(247
)
65
251
(182
)
Net (Loss)/Income
$
(767
)
$
343
$
482
$
(684
)
Less: Cumulative dividends attributable to
Series A Preferred Stock
17
17
51
38
Net (Loss)/Income Available for Common
Stockholders
$
(784
)
$
326
$
431
$
(722
)
(Loss)/Income per Share
Weighted average number of common shares
outstanding — basic
207
230
207
230
(Loss)/Income per Weighted Average
Common Share — Basic
$
(3.79
)
$
1.42
$
2.08
$
(3.14
)
Weighted average number of common shares
outstanding — diluted
207
232
213
230
(Loss)/Income per Weighted Average
Common Share —Diluted
$
(3.79
)
$
1.41
$
2.02
$
(3.14
)
NRG ENERGY, INC. AND
SUBSIDIARIES
CONDENSED CONSOLIDATED
STATEMENTS OF COMPREHENSIVE (LOSS)/INCOME
(Unaudited)
Three months ended
September 30,
Nine months ended
September 30,
(In millions)
2024
2023
2024
2023
Net (Loss)/Income
$
(767
)
$
343
$
482
$
(684
)
Other Comprehensive
(Loss)/Income
Foreign currency translation
adjustments
6
(8
)
(4
)
—
Defined benefit plans
(8
)
1
(10
)
—
Other comprehensive (loss)/income
(2
)
(7
)
(14
)
—
Comprehensive (Loss)/Income
$
(769
)
$
336
$
468
$
(684
)
NRG ENERGY, INC. AND
SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE
SHEETS
September 30, 2024
December 31, 2023
(In millions, except share
data)
(Unaudited)
(Audited)
ASSETS
Current Assets
Cash and cash equivalents
$
1,104
$
541
Funds deposited by counterparties
12
84
Restricted cash
10
24
Accounts receivable, net
3,258
3,542
Inventory
540
607
Derivative instruments
2,456
3,862
Cash collateral paid in support of energy
risk management activities
449
441
Prepayments and other current assets
782
626
Total current assets
8,611
9,727
Property, plant and equipment,
net
1,818
1,763
Other Assets
Equity investments in affiliates
49
42
Operating lease right-of-use assets,
net
172
179
Goodwill
5,018
5,079
Customer relationships, net
1,648
2,164
Other intangible assets, net
1,439
1,763
Derivative instruments
1,747
2,293
Deferred income taxes
2,098
2,251
Other non-current assets
1,124
777
Total other assets
13,295
14,548
Total Assets
$
23,724
$
26,038
LIABILITIES AND STOCKHOLDERS'
EQUITY
Current Liabilities
Current portion of long-term debt and
finance leases
$
258
$
620
Current portion of operating lease
liabilities
77
90
Accounts payable
1,994
2,325
Derivative instruments
2,351
4,019
Cash collateral received in support of
energy risk management activities
12
84
Deferred revenue current
761
720
Accrued expenses and other current
liabilities
1,895
1,642
Total current liabilities
7,348
9,500
Other Liabilities
Long-term debt and finance leases
10,422
10,133
Non-current operating lease
liabilities
125
128
Derivative instruments
1,469
1,488
Deferred income taxes
8
22
Deferred revenue non-current
919
914
Other non-current liabilities
913
947
Total other liabilities
13,856
13,632
Total Liabilities
21,204
23,132
Commitments and Contingencies
Stockholders' Equity
Preferred stock; 10,000,000 shares
authorized; 650,000 Series A shares issued and outstanding at
September 30, 2024 and December 31, 2023, aggregate liquidation
preference of $650; at September 30, 2024 and December 31, 2023
650
650
Common stock; $0.01 par value; 500,000,000
shares authorized; 264,056,285 and 267,330,470 shares issued and
204,929,327 and 208,130,950 shares outstanding at September 30,
2024 and December 31, 2023, respectively
3
3
Additional paid-in-capital
3,145
3,416
Retained earnings
977
820
Treasury stock, at cost; 59,126,958 shares
and 59,199,520 shares at September 30, 2024 and December 31, 2023,
respectively
(2,150
)
(1,892
)
Accumulated other comprehensive loss
(105
)
(91
)
Total Stockholders' Equity
2,520
2,906
Total Liabilities and Stockholders'
Equity
$
23,724
$
26,038
NRG ENERGY, INC. AND
SUBSIDIARIES
CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS
(Unaudited)
Nine months ended September
30,
(In millions)
2024
2023
Cash Flows from Operating
Activities
Net Income/(Loss)
$
482
$
(684
)
Adjustments to reconcile net income/(loss)
to cash provided/(used) by operating activities:
Equity in and distributions from earnings
of unconsolidated affiliates
(6
)
(16
)
Depreciation of property, plant and
equipment and amortization of customer relationships and other
intangible assets
814
813
Amortization of capitalized contract
costs
231
108
Accretion of asset retirement
obligations
29
14
Provision for credit losses
228
165
Amortization of nuclear fuel
—
42
Amortization of financing costs and debt
discounts
32
42
Loss on debt extinguishment
260
—
Amortization of in-the-money contracts and
emissions allowances
83
111
Amortization of unearned equity
compensation
82
87
Net gain on sale of assets and disposal of
assets
(197
)
(187
)
Impairment losses
15
—
Changes in derivative instruments
268
1,553
Changes in current and deferred income
taxes and liability for uncertain tax benefits
134
(225
)
Changes in collateral deposits in support
of risk management activities
(80
)
(1,188
)
Changes in nuclear decommissioning trust
liability
—
(4
)
Changes in other working capital
(1,021
)
(1,093
)
Cash provided/(used) by operating
activities
$
1,354
$
(462
)
Cash Flows from Investing
Activities
Payments for acquisitions of businesses
and assets, net of cash acquired
$
(33
)
$
(2,502
)
Capital expenditures
(286
)
(493
)
Net purchases of emissions allowances
(16
)
(25
)
Investments in nuclear decommissioning
trust fund securities
—
(293
)
Proceeds from the sale of nuclear
decommissioning trust fund securities
—
280
Proceeds from sales of assets, net of cash
disposed
495
229
Proceeds from insurance recoveries for
property, plant and equipment, net
3
173
Cash provided/(used) by investing
activities
$
163
$
(2,631
)
Cash Flows from Financing
Activities
Proceeds from issuance of preferred stock,
net of fees
$
—
$
635
Payments of dividends to preferred and
common stockholders
(322
)
(295
)
Equivalent shares purchased in lieu of tax
withholdings
(45
)
(19
)
Payments for share repurchase activity
(316
)
(50
)
Net (payments)/receipts from settlement of
acquired derivatives that include financing elements
(2
)
332
Net proceeds of Revolving Credit Facility
and Receivable Securitization Facilities
—
300
Proceeds from issuance of long-term
debt
875
731
Payments of debt issuance costs
(13
)
(29
)
Repayments of long-term debt and finance
leases
(960
)
(15
)
Payments for debt extinguishment costs
(258
)
—
Proceeds from credit facilities
1,050
3,020
Repayments to credit facilities
(1,050
)
(3,020
)
Cash (used)/provided by financing
activities
$
(1,041
)
$
1,590
Effect of exchange rate changes on cash
and cash equivalents
1
—
Net Increase/(Decrease) in Cash and
Cash Equivalents, Funds Deposited by Counterparties and Restricted
Cash
477
(1,503
)
Cash and Cash Equivalents, Funds
Deposited by Counterparties and Restricted Cash at Beginning of
Period
649
2,178
Cash and Cash Equivalents, Funds
Deposited by Counterparties and Restricted Cash at End of
Period
$
1,126
$
675
Appendix Table A-1: Third Quarter 2024 Adjusted EBITDA
Reconciliation by Operating Segment and Consolidated Adjusted EPS
Reconciliation
The following table summarizes the calculation of Adjusted
EBITDA, Adjusted Net Income and Adjusted EPS and provides a
reconciliation from Net (Loss)/Income1:
($ in millions, except per share
amounts)
Texas
East
West/Services/
Other
Vivint
Smart Home
Corp/Elim
Total
Net (Loss)/Income
$
(1,056
)
$
88
$
148
$
(29
)
$
82
$
(767
)
Plus:
Interest expense, net
1
1
7
74
122
205
Income tax
—
1
—
(8
)
(240
)
(247
)
Depreciation and amortization2
81
39
23
198
11
352
ARO Expense
11
14
1
—
—
26
Contract and emission credit amortization,
net
5
(4
)
4
—
—
5
EBITDA
(958
)
139
183
235
(25
)
(426
)
Stock-based compensation
6
2
2
15
—
25
Adjustment to reflect NRG share of
adjusted EBITDA in unconsolidated affiliates
—
—
2
—
—
2
Acquisition and divestiture integration
and transaction costs
—
—
—
1
8
9
Cost to achieve
—
—
—
—
6
6
Deactivation costs
—
4
—
—
—
4
(Gain) on sale of assets
—
—
(208
)
—
—
(208
)
Other and non-recurring charges
(1
)
10
—
6
(2
)
13
Mark to market (MtM) losses on economic
hedges
1,537
9
84
—
—
1,630
Adjusted EBITDA
$
584
$
164
$
63
$
257
$
(13
)
$
1,055
Interest expense, net
(205
)
Depreciation and amortization
(352
)
Adjusted Income before income
taxes
498
Adjusted income tax3
(88
)
Adjusted Net Income before Preferred
Stock dividends
410
Cumulative dividends attributable to
Series A Preferred Stock
(17
)
Adjusted Net Income4
393
Weighted average number of common shares
outstanding - basic
207
Adjusted EPS
$
1.90
1 Adjusted EBITDA recast to exclude all
impacts of amortization of capitalized contract costs related to
fulfillment, now reflected in depreciation and amortization
2 Depreciation and amortization recast to
include impact of amortization of capitalized contract costs
3 Income tax calculated using Adjusted
effective tax rate (ETR) on Adjusted Income before income taxes.
Adjusted ETR includes impact of NRG’s tax credits, consisting of
incentive tax credit in connection with renewable projects as well
as production tax credits for carbon recapture for pre-IRA
periods
4 Adjusted Net Income as shown here is
‘Adjusted Net Income available for common stockholders’
Third Quarter 2024 condensed financial information by Operating
Segment:
($ in millions)
Texas
East
West/Services/
Other
Vivint
Smart Home
Corp/Elim
Total
Revenue1
$
3,301
$
2,606
$
828
$
499
$
(11
)
$
7,223
Cost of fuel, purchased power and other
cost of sales2
2,222
2,166
651
37
(5
)
5,071
Economic gross margin
1,079
440
177
462
(6
)
2,152
Operations & maintenance and other
cost of operations3
240
119
64
66
2
491
Selling, marketing, general and
administrative4
255
154
64
138
3
614
Other
—
3
(14
)
1
2
(8
)
Adjusted EBITDA
$
584
$
164
$
63
$
257
$
(13
)
$
1,055
1 Excludes MtM gain of $(8) million and
contract amortization of $8 million
2 Includes TDSP expense, capacity and
emission credits
3 Excludes ARO expenses of $26 million,
other and non-recurring charges of $10 million, deactivation costs
of $4 million and stock-based compensation of $2 million
4 Excludes stock-based compensation of $23
million, cost to achieve of $6 million, acquisition and divestiture
integration and transaction costs of $3 million and other and
non-recurring charges of $(1) million
The following table reconciles the condensed financial
information to Adjusted EBITDA:
($ in millions)
Condensed Consolidated Results
of Operations
Interest, tax, depr.,
amort.
MtM
Deactivation
Other adj.2
Adjusted EBITDA
Revenue
$
7,223
$
8
$
(8
)
$
—
$
—
$
7,223
Cost of operations (excluding depreciation
and amortization shown below)1
6,706
3
(1,638
)
—
—
5,071
Depreciation and Amortization
352
(352
)
—
—
—
—
Gross margin
165
357
1,630
—
—
2,152
Operations & maintenance and other
cost of operations
533
—
—
(4
)
(38
)
491
Selling, marketing, general &
administrative
645
—
—
—
(31
)
614
Other
(246
)
42
—
—
196
(8
)
Net (Loss)/Income
$
(767
)
$
315
$
1,630
$
4
$
(127
)
$
1,055
1 Excludes operations & maintenance
and other cost of operations of $533 million
2 Other adj. includes ARO expenses of $26
million, stock-based compensation of $25 million, other and
non-recurring charges of $13 million, acquisition and divestiture
integration and transaction costs of $9 million, cost to achieve of
$6 million, NRG share of adjusted EBITDA in unconsolidated
affiliates of $2 million and gain on sale of assets of $(208)
million
Appendix Table A-2: Third Quarter 2023 Adjusted EBITDA
Reconciliation by Operating Segment and Consolidated Adjusted EPS
Reconciliation
The following table summarizes the calculation of Adjusted
EBITDA, Adjusted Net Income and Adjusted EPS and provides a
reconciliation from Net Income/(Loss)1:
($ in millions, except per share
amounts)
Texas
East
West/Services/
Other
Vivint
Smart Home
Corp/Elim
Total
Net Income/(Loss)
$
463
$
316
$
(168
)
$
(4
)
$
(264
)
$
343
Plus:
Interest expense, net
(1
)
(2
)
6
43
109
155
Income tax
—
(2
)
(37
)
(20
)
124
65
Depreciation and amortization2
84
39
24
203
9
359
ARO Expense
3
6
—
—
—
9
Contract and emission credit amortization,
net
5
(16
)
4
—
—
(7
)
EBITDA
554
341
(171
)
222
(22
)
924
Stock-based compensation
4
2
1
19
—
26
Adjustment to reflect NRG share of
adjusted EBITDA in unconsolidated affiliates
—
—
3
—
—
3
Acquisition and divestiture integration
and transaction costs
—
—
—
2
18
20
Deactivation costs
—
9
2
—
—
11
Other and non-recurring charges3
(48
)
3
(2
)
(4
)
1
(50
)
Mark to market (MtM) losses/(gains) on
economic hedges
42
(184
)
195
—
—
53
Adjusted EBITDA
$
552
$
171
$
28
$
239
$
(3
)
$
987
Interest expense, net
(155
)
Depreciation and amortization
(359
)
Adjusted Income before income
taxes
473
Adjusted income tax4
(96
)
Adjusted Net Income before Preferred
Stock dividends
377
Cumulative dividends attributable to
Series A Preferred Stock
(17
)
Adjusted Net Income5
360
Weighted average number of common shares
outstanding - basic
230
Adjusted EPS
$
1.57
1 Adjusted EBITDA recast to exclude all
impacts of amortization of capitalized contract costs related to
fulfillment, now reflected in depreciation and amortization
2 Depreciation and amortization recast to
include impact of amortization of capitalized contract costs
3 Other and non-recurring includes $(50)
million of property insurance proceeds
4 Income tax calculated using Adjusted ETR
on Adjusted Income before income taxes. Adjusted ETR includes
impact of NRG’s tax credits, consisting of incentive tax credit in
connection with renewable projects as well as production tax
credits for carbon recapture for pre-IRA periods
5 Adjusted Net Income as shown here is
‘Adjusted Net Income available for common stockholders’
Third Quarter 2023 condensed financial information by Operating
Segment:
($ in millions)
Texas
East
West/Services/
Other
Vivint
Smart Home
Corp/Elim
Total
Revenue1
$
3,686
$
2,875
$
987
$
478
$
(5
)
$
8,021
Cost of fuel, purchased power and other
cost of sales2
2,659
2,449
844
36
(3
)
5,985
Economic gross margin
1,027
426
143
442
(2
)
2,036
Operations & maintenance and other
cost of operations3
256
110
58
56
(1
)
479
Selling, marketing, general &
administrative4
221
143
64
146
3
577
Other
(2
)
2
(7
)
1
(1
)
(7
)
Adjusted EBITDA
$
552
$
171
$
28
$
239
$
(3
)
$
987
1 Excludes MtM loss of $70 million and
contract amortization of $5 million
2 Includes TDSP expense, capacity and
emission credits
3 Excludes other and non-recurring charges
of $(51) million, deactivation costs of $11 million, ARO expense of
$9 million and stock-based compensation of $2 million
4 Excludes stock-based compensation of $24
million, acquisition and divestiture integration and transaction
costs of $2 million and other non-recurring charges of $(1)
million
The following table reconciles the condensed financial
information to Adjusted EBITDA:
($ in millions)
Condensed Consolidated Results
of Operations
Interest, tax, depr.,
amort.
MtM
Deactivation
Other adj.2
Adjusted EBITDA
Revenue
$
7,946
$
5
$
70
$
—
$
—
$
8,021
Cost of operations (excluding depreciation
and amortization shown below)1
5,956
12
17
—
—
5,985
Depreciation and amortization
359
(359
)
—
—
—
—
Gross margin
1,631
352
53
—
—
2,036
Operations & maintenance and other
cost of operations
450
—
—
(11
)
40
479
Selling, marketing, general &
administrative
602
—
—
—
(25
)
577
Other
236
(220
)
—
—
(23
)
(7
)
Net Income
$
343
$
572
$
53
$
11
$
8
$
987
1 Excludes operations & maintenance
and other cost of operations of $450 million
2 Other adj. includes stock-based
compensation of $26 million, acquisition and divestiture
integration and transaction costs of $20 million, ARO expenses of
$9 million, NRG share of adjusted EBITDA in unconsolidated
affiliates of $3 million and other and non-recurring charges of
$(50) million
Appendix Table A-3: Third Quarter 2024 and 2023 Adjusted Net
Income and Adjusted EPS Reconciliations
The following table summarizes the calculation of Adjusted Net
Income and Adjusted EPS and provides a reconciliation from Net
(Loss)/Income1:
Three Months Ended
($ in millions, except per share
amounts)
September
30, 2024
Earnings/(Loss) per Share,
Basic2
Earnings/(Loss) per Share,
Diluted2
September
30, 2023
Earnings per
Share, Basic2
Earnings per
Share, Diluted2
Net (Loss)/Income Available for Common
Stockholders
$
(784
)
$
(3.79
)
$
(3.79
)
$
326
$
1.42
$
1.41
Plus:
Dilutive impact adjustment on Net (Loss)
Available for Common Stockholders3
0.09
Cumulative dividends attributable to
Series A Preferred Stock
17
0.08
0.08
17
0.07
0.07
ARO expense
26
0.13
0.12
9
0.04
0.04
Contract and emission credit amortization,
net
5
0.02
0.02
(7
)
(0.03
)
(0.03
)
Stock-based compensation
25
0.12
0.12
26
0.11
0.11
Adjustment to reflect NRG share of
adjusted EBITDA in unconsolidated affiliates
2
0.01
0.01
3
0.01
0.01
Acquisition and divestiture integration
and transaction costs
9
0.04
0.04
20
0.09
0.09
Cost to achieve
6
0.03
0.03
—
—
—
Deactivation costs
4
0.02
0.02
11
0.05
0.05
(Gain) on sale of assets
(208
)
(1.00
)
(0.98
)
—
—
—
Other and non-recurring charges4
13
0.06
0.06
(50
)
(0.22
)
(0.22
)
Mark to market (MtM) loss on economic
hedges
1,630
7.87
7.69
53
0.23
0.23
Income Tax5
(247
)
(1.19
)
(1.17
)
65
0.28
0.28
Adjusted Income before income
taxes
498
$
2.41
$
2.35
473
$
2.06
$
2.04
Adjusted income tax6
(88
)
(0.43
)
(0.42
)
(96
)
(0.42
)
(0.41
)
Adjusted Net Income before Preferred
Stock dividends
410
$
1.98
$
1.93
377
$
1.64
$
1.63
Cumulative dividends attributable to
Series A Preferred Stock
(17
)
(0.08
)
(0.08
)
(17
)
(0.07
)
(0.07
)
Adjusted Net Income7
$
393
$
1.90
$
1.85
$
360
$
1.57
$
1.55
1 Items may not sum due to rounding
2 Earnings per share amounts are based on
weighted average number of common shares outstanding - basic of 207
million and 230 million for the three months ended September 30,
2024 and 2023, respectively, and on weighted average number of
common shares outstanding - diluted of 212 million and 232 million
for the three months ended September 30, 2024 and 2023,
respectively
3 Includes the potential dilutive impacts
of the Convertible Senior Notes of 3 million shares and equity
compensation of 2 million shares for the three months ended
September 30, 2024. Under GAAP when there is a net loss, dilutive
securities are not included in the diluted share count as they are
anti-dilutive. As Adjusted Net Income is in an income position and
not a loss position, this line item reflects the impact of the
anti-dilutive securities as if they were dilutive
4 2023 other and non-recurring includes
$(50) million of property insurance proceeds
5 Represents GAAP income tax
6 Income tax calculated using Adjusted ETR
on Adjusted Income before income taxes. Adjusted ETR includes
impact of NRG’s tax credits, consisting of incentive tax credit in
connection with renewable projects as well as production tax
credits for carbon recapture for pre-IRA periods. Other Adjustments
are shown on pre-tax basis
7 Adjusted Net Income as shown here is
‘Adjusted Net Income available for common stockholders’
Appendix Table A-4: YTD Third Quarter 2024 Adjusted EBITDA
Reconciliation by Operating Segment and Consolidated Adjusted EPS
Reconciliation
The following table summarizes the calculation of Adjusted
EBITDA, Adjusted Net Income and Adjusted EPS and provides a
reconciliation from Net Income/(Loss)1:
($ in millions, except per share
amounts)
Texas
East
West/
Services/
Other
Vivint
Smart Home
Corp/Elim
Total
Net Income/(Loss)
$
259
$
1,116
$
90
$
(51
)
$
(932
)
$
482
Plus:
Interest expense, net
2
3
21
161
299
486
Income tax
—
—
(21
)
(8
)
280
251
Loss on debt extinguishment
—
—
—
—
260
260
Depreciation and amortization2
240
117
96
561
31
1,045
ARO expense
15
13
1
—
—
29
Contract and emission credit amortization,
net
7
54
7
—
—
68
EBITDA
523
1,303
194
663
(62
)
2,621
Stock-based compensation3
20
9
4
46
—
79
Adjustment to reflect NRG share of
adjusted EBITDA in unconsolidated affiliates
—
—
3
—
—
3
Acquisition and divestiture integration
and transaction costs4
—
—
—
9
18
27
Cost to achieve5
—
—
—
—
23
23
Deactivation costs
—
13
2
—
—
15
Loss/(gain) on sale of assets
4
—
(208
)
—
—
(204
)
Other and non-recurring charges
1
9
12
11
(8
)
25
Impairments
—
—
15
—
—
15
Mark to market (MtM) losses/(gains) on
economic hedges
707
(610
)
186
—
—
283
Adjusted EBITDA
$
1,255
$
724
$
208
$
729
$
(29
)
$
2,887
Interest expense, net
(486
)
Depreciation and amortization
(1,045
)
Adjusted Income before income
taxes
1,356
Adjusted income tax6
(239
)
Adjusted Net Income before Preferred
Stock dividends
1,117
Cumulative dividends attributable to
Series A Preferred Stock
(51
)
Adjusted Net Income7
1,066
Weighted average number of common shares
outstanding - basic
207
Adjusted EPS
$
5.15
1 Adjusted EBITDA recast to exclude all
impacts of amortization of capitalized contract costs related to
fulfillment, now reflected in depreciation and amortization
2 Depreciation and amortization recast to
include impact of amortization of capitalized contract costs
3 Stock-based compensation excludes $2
million reflected in cost to achieve and $1 million reflected in
acquisition and divestiture integration and transaction costs
4 Includes stock-based compensation of $1
million
5 Includes stock-based compensation of $2
million
6Income tax calculated using Adjusted ETR
on Adjusted Income before income taxes. Adjusted ETR includes
impact of NRG’s tax credits, consisting of incentive tax credit in
connection with renewable projects as well as production tax
credits for carbon recapture for pre-IRA periods
7Adjusted Net Income as shown here is
‘Adjusted Net Income available for common stockholders’
YTD Third Quarter 2024 condensed financial information by
Operating Segment:
($ in millions)
Texas
East
West/
Services/
Other
Vivint
Smart Home
Corp/Elim
Total
Revenue1
$
8,297
$
8,655
$
2,950
$
1,434
$
(32
)
$
21,304
Cost of fuel, purchased power and other
cost of sales2
5,683
7,176
2,421
108
(17
)
15,371
Economic gross margin
2,614
1,479
529
1,326
(15
)
5,933
Operations & maintenance and other
cost of operations3
754
327
177
178
3
1,439
Selling, general and administrative
costs4
604
426
182
419
6
1,637
Other
1
2
(38
)
—
5
(30
)
Adjusted EBITDA
$
1,255
$
724
$
208
$
729
$
(29
)
$
2,887
1 Excludes MtM gain of $(32) million and
contract amortization of $25 million
2 Includes TDSP expense, capacity and
emission credits
3 Excludes ARO expense of $29 million,
deactivation costs of $15 million, other and non-recurring charges
of $10 million and stock-based compensation of $7 million
4 Excludes stock-based compensation of $72
million, cost to achieve of $23 million, acquisition and
divestiture integration and transaction costs of $5 million and
other and non-recurring charges of $2 million
The following table reconciles the condensed financial
information to Adjusted EBITDA:
($ in millions)
Condensed Consolidated Results
of Operations
Interest, tax, depr.,
amort.
MtM
Deactivation
Other adj.2
Adjusted EBITDA
Revenue
$
21,311
$
25
$
(32
)
$
—
$
—
$
21,304
Cost of operations (excluding depreciation
and amortization shown below)1
15,729
(43
)
(315
)
—
—
15,371
Depreciation and amortization
1,045
(1,045
)
—
—
—
—
Gross margin
4,537
1,113
283
—
—
5,933
Operations & maintenance and other
cost of operations
1,500
—
—
(15
)
(46
)
1,439
Selling, general and administrative
costs
1,739
—
—
—
(102
)
1,637
Other
816
(737
)
—
—
(109
)
(30
)
Net Income
$
482
$
1,850
$
283
$
15
$
257
$
2,887
1 Excludes operations & maintenance
and other cost of operations of $1,500 million
2 Other adj. includes loss on debt
extinguishment of $260 million, stock-based compensation of $79
million, ARO expense of $29 million, acquisition and divestiture
integration and transaction costs of $27 million, other and
non-recurring charges of $25 million, cost to achieve of $23
million, impairments of $15 million, NRG share of adjusted EBITDA
in unconsolidated affiliates of $3 million and gain on sale of
assets $(204) million
Appendix Table A-5: YTD Third Quarter 2023 Adjusted EBITDA
Reconciliation by Operating Segment and Consolidated Adjusted EPS
Reconciliation
The following table summarizes the calculation of Adjusted
EBITDA, Adjusted Net Income and Adjusted EPS and provides a
reconciliation from Net Income/(Loss)1:
($ in millions, except per share
amounts)
Texas
East
West/
Services/
Other
Vivint
Smart
Home2
Corp/Elim
Total
Net Income/(Loss)
$
1,532
$
(1,187
)
$
(601
)
$
(66
)
$
(362
)
$
(684
)
Plus:
Interest expense, net
2
(12
)
18
97
319
424
Income tax
—
(1
)
(83
)
(20
)
(78
)
(182
)
Depreciation and amortization3
257
122
73
442
27
921
ARO expense
7
7
—
—
—
14
Contract and emission credit amortization,
net
9
83
10
—
—
102
EBITDA
1,807
(988
)
(583
)
453
(94
)
595
Stock-based compensation4
15
6
3
41
—
65
Adjustment to reflect NRG share of
adjusted EBITDA in unconsolidated affiliates
—
—
11
—
—
11
Acquisition and divestiture integration
and transaction costs5
—
—
—
39
76
115
Deactivation costs
—
19
8
—
—
27
(Gain) on sale of assets
—
(202
)
—
—
—
(202
)
Other and non-recurring charges6
(91
)
4
(2
)
2
1
(86
)
Mark to market (MtM) (gains)/losses on
economic hedges
(421
)
1,723
631
—
—
1,933
Adjusted EBITDA
$
1,310
$
562
$
68
$
535
$
(17
)
$
2,458
Interest expense, net
(424
)
Depreciation and amortization
(921
)
Adjusted Income before income
taxes
1,113
Adjusted income tax7
(226
)
Adjusted Net Income before Preferred
Stock dividends
887
Cumulative dividends attributable to
Series A Preferred Stock
(38
)
Adjusted Net Income8
849
Weighted average number of common shares
outstanding - basic
230
Adjusted EPS
$
3.69
1 Adjusted EBITDA recast to exclude all
impacts of amortization of capitalized contract costs related to
fulfillment, now reflected in depreciation and amortization
2 Vivint Smart Home acquired in March
2023
3 Depreciation and amortization recast to
include impact of amortization of capitalized contract costs
4 Stock-based compensation excludes $23
million reflected in acquisition and divestiture integration and
transaction costs
5 Includes stock-based compensation of $23
million
6 Other and non-recurring includes $(96)
million of property insurance proceeds
7 Income tax calculated using Adjusted ETR
on Adjusted Income before income taxes. Adjusted ETR includes
impact of NRG’s tax credits, consisting of incentive tax credit in
connection with renewable projects as well as production tax
credits for carbon recapture for pre-IRA periods
8 Adjusted Net Income as shown here is
‘Adjusted Net Income available for common stockholders’
YTD Third Quarter 2023 condensed financial information by
Operating Segment:
($ in millions)
Texas
East
West/
Services/
Other
Vivint
Smart
Home1
Corp/Elim
Total
Revenue2
$
8,235
$
9,485
$
3,164
$
1,070
$
(10
)
$
21,944
Cost of fuel, purchased power and other
cost of sales3
5,613
8,193
2,771
82
(6
)
16,653
Economic gross margin
2,622
1,292
393
988
(4
)
5,291
Operations & maintenance and other
cost of operations4
785
330
185
127
(3
)
1,424
Selling, marketing, general &
administrative5
530
401
165
326
15
1,437
Other
(3
)
(1
)
(25
)
—
1
(28
)
Adjusted EBITDA
$
1,310
$
562
$
68
$
535
$
(17
)
$
2,458
1 Vivint Smart Home acquired in March
2023
2 Excludes MtM gain of $(96) million and
contract amortization of $24 million
3 Includes TDSP expense, capacity and
emission credits
4 Excludes other and non-recurring charges
of $(93) million, deactivation costs of $27 million, ARO expense of
$14 million and stock-based compensation of $5 million
5 Excludes stock-based compensation of $60
million, acquisition and divestiture integration and transaction
costs of $4 million and other and non-recurring charges of $1
million
The following table reconciles the condensed financial
information to Adjusted EBITDA:
($ in millions)
Condensed Consolidated Results
of Operations
Interest, tax, depr.,
amort.
MtM
Deactivation
Other adj.2
Adjusted EBITDA
Revenue
$
22,016
$
24
$
(96
)
$
—
$
—
$
21,944
Cost of operations (excluding depreciation
and amortization shown below)1
18,760
(78
)
(2,029
)
—
—
16,653
Depreciation and amortization
921
(921
)
—
—
—
—
Gross margin
2,335
1,023
1,933
—
—
5,291
Operations & maintenance and Other
cost of operations
1,377
—
—
(27
)
74
1,424
Selling, marketing, general &
administrative
1,502
—
—
—
(65
)
1,437
Other
140
(242
)
—
—
74
(28
)
Net (Loss)/Income
$
(684
)
$
1,265
$
1,933
$
27
$
(83
)
$
2,458
1 Excludes operations & maintenance
and other cost of operations of $1,377 million
2 Other adj. includes acquisition and
divestiture integration and transaction costs of $115 million,
stock-based compensation costs of $65 million, ARO expense of $14
million, NRG share of adjusted EBITDA in unconsolidated affiliates
of $11 million, gain on sale of assets of $(202) million and other
and non-recurring charges of $(86) million
Appendix Table A-6: YTD Third Quarter 2024 and 2023 Adjusted
Net Income and Adjusted EPS Reconciliations
The following table summarizes the calculation of Adjusted Net
Income and Adjusted EPS and provides a reconciliation from Net
Income/(Loss)1:
Nine Months Ended
($ in millions, except per share
amounts)
September
30, 2024
Earnings per
Share, Basic2
Earnings per
Share, Diluted2
September
30, 2023
Earnings/(Loss)
per Share,
Basic2
Earnings/(Loss)
per Share,
Diluted2
Net Income/(Loss) Available for Common
Stockholders
$
431
$
2.08
$
2.02
$
(722
)
$
(3.14
)
$
(3.14
)
Plus:
Dilutive impact adjustment on Net (Loss)
Available for Common Stockholders3
0.01
Cumulative dividends attributable to
Series A Preferred Stock
51
0.25
0.24
38
0.17
0.16
Loss on debt extinguishment
260
1.26
1.22
—
—
—
ARO expense
29
0.14
0.14
14
0.06
0.06
Contract and emission credit amortization,
net
68
0.33
0.32
102
0.44
0.44
Stock-based compensation4
79
0.38
0.37
65
0.28
0.28
Adjustment to reflect NRG share of
adjusted EBITDA in unconsolidated affiliates
3
0.01
0.01
11
0.05
0.05
Acquisition and divestiture integration
and transaction costs5
27
0.13
0.13
115
0.50
0.50
Cost to achieve6
23
0.11
0.11
—
—
—
Deactivation costs
15
0.07
0.07
27
0.12
0.12
(Gain) on sale of assets
(204
)
(0.99
)
(0.96
)
(202
)
(0.88
)
(0.87
)
Other and non-recurring charges7
25
0.12
0.12
(86
)
(0.37
)
(0.37
)
Impairments
15
0.07
0.07
—
—
—
Mark to market (MtM) loss on economic
hedges
283
1.37
1.33
1,933
8.40
8.37
Income Tax8
251
1.21
1.18
(182
)
(0.79
)
(0.79
)
Adjusted Income before income
taxes
1,356
$
6.55
$
6.37
1,113
$
4.84
$
4.82
Adjusted income tax9
(239
)
(1.15
)
(1.12
)
(226
)
(0.98
)
(0.98
)
Adjusted Net Income before Preferred
Stock dividends
1,117
$
5.40
$
5.24
887
$
3.86
$
3.84
Cumulative dividends attributable to
Series A Preferred Stock
(51
)
(0.25
)
(0.24
)
(38
)
(0.17
)
(0.16
)
Adjusted Net Income10
$
1,066
$
5.15
$
5.00
$
849
$
3.69
$
3.68
1 Items may not sum due to rounding
2 Earnings per share amounts are based on
weighted average number of common shares outstanding - basic of 207
million and 230 million for the nine months ended September 30,
2024 and 2023, respectively, and on weighted average number of
common shares outstanding - diluted of 213 million and 231 million
for the nine months ended September 30, 2024 and 2023,
respectively
3 Includes the potential dilutive impact
of equity compensation of 1 million shares for the nine months
ended September 30, 2023. Per GAAP when there is a net loss,
dilutive securities are not included in the diluted share count as
they are anti-dilutive. As Adjusted Net Income is in an income
position and not a loss position, this line item reflects the
impact of the anti-dilutive securities as if they were dilutive
4 2024 stock-based compensation excludes
$2 million reflected in cost to achieve and $1 million reflected in
acquisition and divestiture integration and transaction; 2023
stock-based compensation excludes $23 million reflected in
acquisition and divestiture integration and transaction costs
5 2024 includes stock-based compensation
of $1 million; 2023 includes stock-based compensation of $23
million
6 2024 includes stock-based compensation
of $2 million
7 2023 other and non-recurring includes
$(96) million of property insurance proceeds
8 Represents GAAP income tax
9 Income tax calculated using Adjusted ETR
on Adjusted Income before income taxes. Adjusted ETR includes
impact of NRG’s tax credits, consisting of incentive tax credit in
connection with renewable projects as well as production tax
credits for carbon recapture for pre-IRA periods. Other Adjustments
are shown on pre-tax basis
10 Adjusted Net Income as shown here is
‘Adjusted Net Income available for common stockholders’
Appendix Table A-7: Three Months Ended September 30, 2024 and
2023 Free Cash Flow before Growth Investments (FCFbG)
The following table summarizes the calculation of FCFbG,
providing a reconciliation to Cash provided by operating activities
and Adjusted Net Income:
Three Months Ended
($ in millions)
9/30/24
9/30/23
Adjusted Net Income
$
393
$
360
Cumulative dividends attributable to
Series A Preferred Stock
17
17
Interest payments (in excess of)/less than
expense
28
(36
)
Depreciation and amortization
352
359
Income tax payments less than expense
82
88
Gross capitalized contract costs1
(259
)
(265
)
Collateral / working capital / other
assets and liabilities2
(582
)
43
Cash provided by operating
activities
31
566
Net receipts from settlement of acquired
derivatives that include
financing elements
10
14
Acquisition and divestiture integration
and transaction costs3
28
20
GenOn pension
18
—
Adjustment for change in collateral
740
(167
)
Nuclear decommissioning trust
liability
—
(8
)
Effect of exchange rate changes on cash
and cash equivalents
1
(3
)
Adjusted cash provided by operating
activities
828
422
Maintenance capital expenditures, net4
(55
)
(102
)
Environmental capital expenditures
(7
)
(1
)
Cost of acquisition
49
36
Free Cash Flow before Growth
Investments (FCFbG)
$
815
$
355
1 Gross capitalized contract costs
represent the costs directly related and incremental to the
origination of new contracts, modification of existing contracts or
to the fulfillment of the related subscriber contracts; these costs
include installed products, commissions, other compensation and
cost of installation of new or upgraded customer contracts; these
costs are amortized on a straight-line basis over the expected
period of benefit to depreciation and amortization
2 Includes the cash impact of Net deferred
revenue
3 Three months ended 9/30/24 includes $6
million Cost to achieve payments
4 Three months ended 9/30/23 includes W.A.
Parish Unit 8 insurance recoveries related to property, plant and
equipment of $52 million
Appendix Table A-8: Nine Months Ended September 30, 2024 and
2023 Free Cash Flow before Growth Investments (FCFbG)
The following table summarizes the calculation of FCFbG,
providing a reconciliation to Cash provided/(used) by operating
activities and Adjusted Net Income:
Nine Months Ended
($ in millions)
9/30/24
9/30/23
Adjusted Net Income
$
1,066
$
849
Cumulative dividends attributable to
Series A Preferred Stock
51
38
Interest payments less than expense
34
28
Depreciation and amortization
1,045
921
Income tax payments less than expense
127
186
Gross capitalized contract costs1
(698
)
(622
)
Collateral/working capital/other assets
and liabilities2
(271
)
(1,862
)
Cash provided by/(used by) operating
activities
1,354
(462
)
Net (payments)/receipts from settlement of
acquired derivatives that include financing elements
(2
)
332
Acquisition and divestiture integration
and transaction costs3
63
95
Astoria fees
—
3
Proceeds from sale of land
9
—
GenOn pension
18
—
Encina site improvement
—
7
Adjustment for change in collateral
80
1,188
Nuclear decommissioning trust
liability
—
(13
)
Effect of exchange rate changes on cash
and cash equivalents
1
—
Adjusted cash provided by operating
activities
1,523
1,150
Maintenance capital expenditures, net4
(178
)
(256
)
Environmental capital expenditures
(15
)
(1
)
Cost of acquisition
108
90
Free Cash Flow before Growth
Investments (FCFbG)
$
1,438
$
983
1 Gross capitalized contract costs
represent the costs directly related and incremental to the
origination of new contracts, modification of existing contracts or
to the fulfillment of the related subscriber contracts; these costs
include installed products, commissions, other compensation and
cost of installation of new or upgraded customer contracts; these
costs are amortized on a straight-line basis over the expected
period of benefit to depreciation and amortization
2 Includes the cash impact of Net deferred
revenue
3 Nine months ended 9/30/24 includes $23
million Cost to achieve payments and excludes $3 million non-cash
stock-based compensation; nine months ended 9/30/23 excludes $23
million non-cash stock-based compensation
4 Nine months ended 9/30/24 includes W.A.
Parish Unit 8 insurance recoveries related to property, plant and
equipment of $3 million; nine months ended 9/30/23 includes W.A.
Parish Unit 8 and Limestone Unit 1 insurance recoveries related to
property, plant and equipment of $173 million
Appendix Table A-9: Nine Months Ended September 30, 2024
Sources and Uses of Liquidity
The following table summarizes the sources and uses of liquidity
for the nine months ended September 30, 2024:
($ in millions)
Nine months ended
September 30, 2024
Sources:
Adjusted cash provided by operating
activities
$
1,523
Change in availability under revolving
credit facility and collective collateral facilities
1,052
Proceeds from issuance of long-term
debt
875
Proceeds from sales of assets, net of cash
disposed
495
Uses:
Repayments of long-term debt and finance
leases
(960
)
Payments of dividends to preferred and
common stockholders
(322
)
Payments for share repurchase activity
(316
)
Payments for debt extinguishment costs
(258
)
Maintenance and environmental capital
expenditures, net1
(192
)
Investments and integration capital
expenditures
(91
)
Acquisition and divestiture integration
and transaction costs
(58
)
Payments for shares repurchased in lieu of
tax withholdings
(45
)
Payments for acquisitions of businesses
and assets, net of cash acquired
(33
)
Net purchases of emission allowances
(16
)
Payments of debt issuance costs
(13
)
Cash collateral paid in support of energy
risk management activities
(8
)
Other investing and financing
(32
)
Change in Total Liquidity
$
1,601
1 Includes $3 million of W.A. Parish Unit
8 insurance recoveries related to property, plant and equipment
Appendix Table A-10: Guidance Reconciliations
The following table summarizes the 2024 Original and Raised
Guidance calculations of Adjusted EBITDA, Adjusted Net Income and
Adjusted EPS and provides a reconciliation from Net Income1:
2024 Original
2024 Raised
2025
($ in millions, except per share
amounts)
Guidance
Guidance
Guidance
Net Income2
$750 - $1,000
$925 - $1,075
$1,025 - $1,225
Interest expense, net
640
640
635
Income tax3
345
395
390 - 440
Depreciation and amortization4
1,420
1,420
1,400
ARO expense
25
25
25
Stock-based compensation
100
100
100
Acquisition and divestiture integration
and transaction costs
55
55
20
Other5
95
95
130
Adjusted EBITDA
$3,430 - $3,680
$3,655 - $3,805
$3,725 - $3,975
Interest expense, net
(640)
(640)
(635)
Depreciation and amortization
(1,420)
(1,420)
(1,400)
Adjusted Income before income
taxes
$1,370 - $1,620
$1,595 - $1,745
$1,690 - $1,940
Adjusted income tax expense6
(263)
(293)
(293) - (343)
Adjusted Net Income before Preferred
Stock dividends
$1,107 - $1,357
$1,302 - $1,452
$1,397 - 1,597
Cumulative dividends attributable to
Series A Preferred Stock
(67)
(67)
(67)
Adjusted Net Income7
$1,040 - $1,290
$1,235 - $1,385
$1,330 - $1,530
Weighted average number of common shares
outstanding - basic
206
206
197
Adjusted EPS
$5.00 - $6.30
$5.95 - $6.75
$6.75 - $7.75
1 Adjusted EBITDA recast to exclude all
impacts of amortization of capitalized contract costs related to
fulfillment, now reflected in depreciation and amortization
2 The Company does not guide to Net Income
due to the impact of fair value adjustments related to derivatives
in a given year. For purposes of guidance, fair value adjustments
related to derivatives are assumed to be zero
3 Represents anticipated GAAP income
tax
4 Depreciation and amortization recast to
include impact of amortization of capitalized contract costs
5 Includes adjustments for sale of assets,
adjustments to reflect NRG share of Adjusted EBITDA in
unconsolidated affiliates, deactivation costs, other non-recurring
expenses, and does not include the adjustment for loss on debt
extinguishment which was $260 million as of September 30, 2024 and
does not include gain on sale of Airtron of $208 million
6 Income tax calculated using Adjusted ETR
on Adjusted Income before income taxes. Adjusted ETR includes
impact of NRG’s tax credits, consisting of incentive tax credit in
connection with renewable projects as well as production tax
credits for carbon recapture for pre-IRA periods. Other Adjustments
are shown on pre-tax basis
7 Adjusted Net Income as shown here is
‘Adjusted Net Income available for common stockholders’; see
appendix table A-11 for GAAP Reconciliation
Appendix Table A-11: 2024 and 2025 Guidance Adjusted Net
Income and Adjusted EPS Reconciliations
The following table summarizes the 2024 Guidance calculations of
Adjusted Net Income and Adjusted EPS and provides a reconciliation
from Net Income1:
2024 Original Guidance
2024 Raised Guidance
($ in millions, except per share
amounts)
Full Year
2024
Earnings per
Share, Basic2
Full Year
2024
Earnings per
Share, Basic2
Net Income3
$750 - $1,000
N/A
$925 - $1,075
N/A
Cumulative dividends attributable to
Series A Preferred Stock
(67)
N/A
(67)
N/A
Net Income Available for Common
Stockholders
$683 - $933
$3.25 - $4.55
$858 - $1,008
$4.10 - $4.90
Plus:
Cumulative dividends attributable to
Series A Preferred Stock
67
0.33
67
0.33
ARO Expense
25
0.12
25
0.12
Stock-based compensation
100
0.49
100
0.49
Acquisition and divestiture integration
and transaction costs
55
0.27
55
0.27
Other4
95
0.46
95
0.46
Income Tax5
345
1.67
395
1.92
Adjusted Income before income
taxes
$1,370 - $1,620
$6.60 - $7.90
$1,595 - $1,745
$7.70 - $8.50
Adjusted income tax6
(263)
(1.28)
(293)
(1.42)
Adjusted Net Income before Preferred
Stock dividends
$1,107 - $1,357
$5.35 - $6.65
$1,302 - $1,452
$6.30 - $7.10
Cumulative dividends attributable to
Series A Preferred Stock
(67)
(0.33)
(67)
(0.33)
Adjusted Net Income7
$1,040 - $1,290
$5.00 - $6.30
$1,235 - $1,385
$5.95 - $6.75
1 Items may not sum due to rounding
2 Earnings per share amount is based on
weighted average number of common shares outstanding - basic of 206
million for 2024 original and 2024 raised guidance
3 The Company does not guide to Net Income
due to the impact of fair value adjustments related to derivatives
in a given year. For purposes of guidance, fair value adjustments
related to derivatives are assumed to be zero
4 Includes adjustments for sale of assets,
adjustments to reflect NRG share of Adjusted EBITDA in
unconsolidated affiliates, deactivation costs, other non-recurring
expenses, and does not include the adjustment for loss on debt
extinguishment which was $260 million as of September 30, 2024 and
does not include gain on sale of Airtron of $208 million
5 Represents anticipated GAAP income
tax
6 Income tax calculated using Adjusted ETR
on Adjusted Income before income taxes. Adjusted ETR includes
impact of NRG’s tax credits, consisting of incentive tax credit in
connection with renewable projects as well as production tax
credits for carbon recapture for pre-IRA periods. Other Adjustments
are shown on pre-tax basis
7 Adjusted Net Income as shown here is
‘Adjusted Net Income available for common stockholders’
The following table summarizes the 2025 Guidance calculations of
Adjusted Net Income and Adjusted EPS and provides a reconciliation
from Net Income1:
2025 Guidance
($ in millions, except per share
amounts)
Full Year 2025
Earnings per
Share, Basic2
Net Income3
$1,025 - $1,225
N/A
Cumulative dividends attributable to
Series A Preferred Stock
(67)
N/A
Net Income Available for Common
Stockholders
$958 - $1,158
$4.85 - $5.85
Plus:
Cumulative dividends attributable to
Series A Preferred Stock
67
0.34
ARO Expense
25
0.13
Stock-based compensation
100
0.51
Acquisition and divestiture integration
and transaction costs
20
0.10
Other4
130
0.66
Income Tax5
390 - 440
1.98 - 2.23
Adjusted Income before income
taxes
$1,690 - $1,940
$8.70 - $9.70
Adjusted income tax6
(293) - (343)
(1.49) - (1.74)
Adjusted Net Income before Preferred
Stock dividends
$1,397 - $1,597
$7.10 - $8.10
Cumulative dividends attributable to
Series A Preferred Stock
(67)
(0.34)
Adjusted Net Income7
$1,330 - $1,530
$6.75 - $7.75
1 Items may not sum due to rounding
2 Earnings per share amount is based on
weighted average number of common shares outstanding - basic of 197
million for 2025 guidance
3 For purposes of guidance, fair value
adjustments related to derivatives are assumed to be zero
4 Includes adjustments for sale of assets,
adjustments to reflect NRG share of Adjusted EBITDA in
unconsolidated affiliates, deactivation costs and other
non-recurring expenses
5 Represents anticipated GAAP income
tax
6 Income tax calculated using Adjusted ETR
on Adjusted Income before income taxes. Adjusted ETR includes
impact of NRG’s tax credits, consisting of incentive tax credit in
connection with renewable projects as well as production tax
credits for carbon recapture for pre-IRA periods. Other Adjustments
are shown on pre-tax basis
7 Adjusted Net Income as shown here is
‘Adjusted Net Income available for common stockholders’
Appendix Table A-12: 2024 and 2025 Guidance
Reconciliations
The following table summarizes the calculation of Adjusted
EBITDA providing reconciliation to Net Income, and the calculation
of FCFbG providing a reconciliation to Cash provided by operating
activities and Adjusted Net Income:
2024 Original
2024 Raised
2025
($ in millions)
Guidance
Guidance
Guidance
Adjusted Net Income
$1,040 - 1,290
$1,235 - 1,385
$1,330 - 1,530
Cumulative dividends attributable to
Series A preferred stock
67
67
67
Interest payments less than expense
40
40
25
Depreciation and amortization
1,420
1,420
1,400
Income tax (excess of)/less than
expense
103
133
168 - 218
Gross capitalized contract costs1
(830)
(830)
(895)
Working capital/other assets and
liabilities2
(15)
(90)
(10)
Cash provided by operating
activities3
1,825 - 2,075
1,975 - 2,125
2,085 - 2,335
Acquisition and other costs2
124
124
35
Adjusted cash provided by operating
activities
1,949 - 2,199
2.099 - 2,249
2,120 - 2,370
Maintenance capital expenditures, net4
(240) - (260)
(240) - (260)
(240) - (260)
Environmental capital expenditures
(20) - (30)
(20) - (30)
(20) - (30)
Cost of acquisition
145
145
130
Free Cash Flow before Growth
Investments (FCFbG)
$1,825 - 2,075
$1,975 - 2,125
$1,975 - 2,225
1 Gross capitalized contract costs
represent the costs directly related and incremental to the
origination of new contracts, modification of existing contracts or
to the fulfillment of the related subscriber contracts; these costs
include installed products, commissions, other compensation, and
cost of installation of new or upgraded customer contracts; these
costs are amortized on a straight-line basis over the expected
period of benefit to depreciation and amortization
2 Working capital / other assets and
liabilities include payments for Acquisition and divestiture
integration and transaction costs which is adjusted in Acquisition
and other costs and Net deferred revenues
3 Excludes fair value adjustments related
to derivatives and changes in collateral deposits in support of
risk management activities
4 Includes W.A. Parish Unit 8 expected
insurance recoveries related to property, plant and equipment
Appendix Table A-13: Actual Full Year 2023 Adjusted EBITDA
Reconciliation for Airtron
The following table summarizes the calculation of Adjusted
EBITDA and provides a reconciliation from Net Income:
($ in millions)
Airtron
(Unaudited)
Net Income
$
29
Plus:
Depreciation and amortization
28
EBITDA
57
Other costs
1
Adjusted EBITDA
$
58
Non-GAAP Financial Measures
NRG reports its financial results in accordance with the
accounting principles generally accepted in the United States
(GAAP) and supplements with certain non-GAAP financial measures.
These measures are not recognized in accordance with GAAP and
should not be viewed in isolation or as an alternative to GAAP
measures of performance. In addition, other companies may calculate
non-GAAP financial measures differently than NRG does, limiting
their usefulness as a comparative measure.
NRG uses the following non-GAAP measures to provide additional
insight into financial performance:
- Adjusted EBITDA: Defined as EBITDA (earnings before
interest, taxes, depreciation, and amortization, impact of asset
retirement obligation expenses and contract amortization consisting
of amortization of power and fuel contracts and amortization of
emission allowances) with further adjustments for stock-based
compensation, impairment losses, deactivation costs, gains or
losses on sales, dispositions or retirements of assets, any
mark-to-market gains or losses from forward position of economic
hedges, gains or losses on the repurchase, modification or
extinguishment of debt, restructuring costs, and other
non-recurring items plus adjustments to reflect the Adjusted EBITDA
from our unconsolidated investments or non-controlling interests.
Adjusted EBITDA is intended to facilitate period-to-period
comparisons and is widely used by investors for performance
assessment.
- Adjusted Net Income: Defined as net income available to
common shareholders excluding the impact of asset retirement
obligation expenses, contract amortization consisting of
amortization of power and fuel contracts and amortization of
emission allowances, stock-based compensation, impairment losses,
deactivation costs, gains or losses on sales, dispositions or
retirements of assets, any mark-to-market gains or losses from
forward position of economic hedges, gains or losses on the
repurchase, modification or extinguishment of debt, the impact of
restructuring and any extraordinary, unusual or non-recurring items
plus adjustments to reflect the Adjusted EBITDA from our
unconsolidated investments and non-controlling interests.
- Adjusted Earnings per Share (EPS): Defined as Adjusted
Net Income, divided by the average basic common shares outstanding.
The Company believes that using average basic common shares
outstanding offers a more accurate view of recurring per-share
earnings, as it better reflects the impact of the fully hedged
convertible note callable in mid-2025.
- Adjusted Cash provided/(used) by operating activities:
Defined as Cash provided/(used) by operating activities with the
reclassification of net payments of derivative contracts acquired
in business combinations from financing to operating cash flow, as
well as the add back of merger, integration, related restructuring
costs, adjustment for change in collateral, and the impact of
extraordinary, unusual or non-recurring items.
- Free Cash Flow before Growth Investments: Defined as
Adjusted Cash provided/(used) by operating activities less
maintenance and environmental capital expenditures, net of funding
and insurance recoveries related to property, plant and equipment,
and adjustments to exclude cost of acquisition related to
growth.
Management believes these non-GAAP financial measures are useful
to investors and other users of NRG's financial statements in
evaluating the Company’s operating performance and growth, as well
as the impact of the Company’s capital allocation program. They
provide an additional tool to compare business performance across
periods and adjust for items that management does not consider
indicative of NRG’s future operating performance. Management uses
these non-GAAP financial measures to assist in comparing financial
performance from period to period on a consistent basis and to
readily view operating trends, as a measure for planning and
forecasting overall expectations, and for evaluating actual results
against such expectations, and in communications with NRG's Board
of Directors, shareholders, creditors, analysts and investors
concerning its financial performance.
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version on businesswire.com: https://www.businesswire.com/news/home/20241107512175/en/
Media Chevalier Gray 832.763.3454
Investors Brendan Mulhern 609.524.4767
NRG Energy (NYSE:NRG)
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