AES Reports Strong Second Quarter Results.ARLINGTON Arlington, county, United States Arlington, county (1990 pop. 170,936), N Va., across the Potomac River from Washington, D.C. Arlington is a residential and commercial suburb of Washington. , Va. -- The AES Corporation AES Corporation AES (NYSE) is a Fortune 1000 company that generates and distributes electrical power. It was founded on January 28, 1981 by Roger Sant from the US Federal Energy Administration and Dennis Bakke from the Office of Management and Budget. (NYSE NYSE See: New York Stock Exchange :AES) today reported significant increases in sales, gross margin and operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. for the second quarter of 2004. Diluted earnings per share diluted earnings per share An earnings measure calculated by dividing net income less preferred stock dividends for a period by the average number of shares of common stock that would be outstanding if all convertible securities were converted into shares of from continuing operations continuing operations Parts of a business that are expected to be maintained as an ongoing segment of an overall business operation. Income and losses from continuing operations are reported separately if any segments have been discontinued during the were $0.10 and adjusted earnings per share(1) were $0.15. Adjusted earnings per share excludes the effects of gains or losses from certain foreign currency transactions, risk management mark-to-market Mark-to-market Adjustment of the book value or collateral value of a security to reflect current market value. accounting and early parent company debt retirement, plus an asset impairment Impairment 1. A reduction in a company's stated capital. 2. The total capital that is less than the par value of the company's capital stock. Notes: 1. This is usually reduced because of poorly estimated losses or gains. 2. in the 2003 quarter. For the prior year quarter, diluted earnings per share from continuing operations were $0.24, and adjusted earnings per share were $0.05. Second Quarter Financial Highlights --Sales growth for the quarter was strong, increasing 14% to $2,263 million compared to $1,992 million in 2003. Sales were driven by higher prices and demand and new plants in operation, partly offset by foreign currency translation effects. --Gross margin increased 20% to $648 million compared to $539 million last year, while gross margin as a percent of sales increased to 29% from 27%. Operating income increased 24% to $611 million. These increases were largely attributable attributable emanating from or pertaining to attribute. attributable proportion see attributable risk (below). attributable risk to the increased sales and operating performance improvements. The gross margin percentage improvement was largely driven by improved prices and performance gains. --Net interest expense declined 16% to $390 million compared to $462 million in the prior year, reflecting the benefits of financial restructuring restructuring - The transformation from one representation form to another at the same relative abstraction level, while preserving the subject system's external behaviour (functionality and semantics). and debt repayments. --The effective tax rate increased to 32% from 29% a year ago, but remained unchanged from the first quarter of 2004. --Net income was $38 million, compared to a prior period loss of $129 million. "We continue to improve the underlying earnings potential of our business portfolio," said Paul Paul, 1901–64, king of the Hellenes (1947–64), brother and successor of George II. He married (1938) Princess Frederika of Brunswick. During Paul's reign Greece followed a pro-Western policy, and the Cyprus question was temporarily resolved. Hanrahan, President and Chief Executive Officer. "Higher tariffs This is a list of tariffs and trade legislation:
Second Quarter Segment Highlights --In Contract Generation, AES's largest segment, sales in the second quarter grew 18% to $868 million from $735 million in 2003, reflecting contract price escalation es·ca·late v. es·ca·lat·ed, es·ca·lat·ing, es·ca·lates v.tr. To increase, enlarge, or intensify: escalated the hostilities in the Persian Gulf. v.intr. , increased demand, and new projects on line. Gross margin improved 14% to $326 million from $286 million a year ago, benefiting from the higher sales. Gross margin as a percent of sales declined to 38% from 39% a year ago, influenced principally by the higher cost of gas and purchased electricity in Chile Chile (chĭl`ē, Span. chē`lā), officially Republic of Chile, republic (2005 est. pop. 15,981,000), 292,256 sq mi (756,945 sq km), S South America, west of the continental divide of the Andes Mts. , more than offsetting strong demand growth in that country. --Competitive Supply sales grew 27% to $248 million from $196 million in the 2003 quarter, benefiting largely from increased demand and new projects on line. Gross margin increased 18% to $53 million from $45 million last year. Gross margin as a percent of sales declined to 21% from 23% a year ago, reflecting higher coal prices and maintenance costs in the New York New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of plants. --Large Utilities sales increased 7% to $834 million from $778 million in the prior period, driven primarily by tariff tariff, tax on imported and, more rarely, exported goods. It is also called a customs duty. Tariffs may be distinguished from other taxes in that their predominant purpose is not financial but economic—not to increase a nation's revenue but to protect domestic increases and reduced non-commercial A non-commercial enterprise is work that values other considerations above and beyond that of making a profit. It differs from a non-profit enterprise in that seeking a profit is a part of their business, just not the main part. losses, partly offset by foreign currency translation effects. Gross margin increased 27% to $207 million from $163 million in the prior period, attributable to higher sales and performance improvements. Gross margin as a percent of sales improved to 25% from 21% a year ago, reflecting the benefit of improved performance in the US and Brazil Brazil (brəzĭl`), Port. Brasil, officially Federative Republic of Brazil, republic (2005 est. pop. 186,113,000), 3,286,470 sq mi (8,511,965 sq km), E South America. . --Growth Distribution sales increased 11% to $313 million compared to $283 million last year, helped by increased demand as well as higher tariffs. Gross margin increased 38% to $62 million compared to $45 million a year ago. Gross margin as a percent of sales increased to 20% from 16%, reflecting improved performance in Cameroon Cameroon, country Cameroon (kăm'ər  n`), Fr. Cameroun, officially Republic of Cameroon, republic (2005 est. pop. .
Year to Date Financial Highlights --Diluted earnings per share from continuing operations were $0.22, compared to $0.47 for the first half of 2003. Adjusted earnings per share were $0.32, compared to $0.18 for the first six months of 2003. --Sales increased 16% to $4,520 million from $3,903 million in the prior period, benefiting from higher prices and demand, foreign currency translation effects, and new plants on line. --Gross margin increased 19% to $1,328 million compared to $1,113 million in last year's first half, largely reflecting higher sales. Gross margin as a percent of sales also improved slightly from a year ago. --Operating income increased 23% to $1,243 million from $1,014 million, reflecting the increase in sales and gross margin. --Net interest expense declined 9% to $814 million from $893 million in the 2003 period, reflecting the impact of financial restructuring and debt repayment Repayment The act of paying back a debt. Notes: Everyone has to repay their debts eventually. See also: Debt, Defeasance, Loan . --The effective tax rate increased to 32% from 29% a year ago. --Net cash from operating activities was $610 million, which was $126 million lower than in the prior year. Comparisons were adversely affected by $31 million of cash flows related to discontinued operations Discontinued operations Divisions of a business that have been sold or written off and that no longer are maintained by the business. . In addition, working capital decreased in 2004, principally in the Large Utilities segment, driven by payments for outstanding payables Payables Related: Accounts payable from the pre-debt restructuring period. --Debt has been reduced by $1,301 million since the beginning of the year, reflecting completion of several financial restructuring transactions and early debt repayment. --Net income was $86 million compared to a prior period loss of $36 million. (1)Note: This analysis of adjusted earnings per share involves a non-GAAP financial measure. See the Reconciliation of Adjusted Earnings Per Share. About AES AES is a leading global power company, with 2003 sales of $8.4 billion. AES operates in 27 countries, generating 45,000 megawatts of electricity through 113 power facilities and delivers electricity through 17 distribution companies. Our 30,000 people are committed to operational excellence and meeting the world's growing power Growing Power is an urban agriculture organization headquartered in Milwaukee, Wisconsin. It runs the last functional farm within the Milwaukee city limits and also organizes activities in Chicago. needs. To learn more about AES, please visit www.aes.com or contact AES investor relations Investor relations The process by which the corporation communicates with its investors. at invest@aes.com. Attachments: Consolidated con·sol·i·date v. con·sol·i·dat·ed, con·sol·i·dat·ing, con·sol·i·dates v.tr. 1. To unite into one system or whole; combine: Statements of Operation, Segment Information, Condensed con·dense v. con·densed, con·dens·ing, con·dens·es v.tr. 1. To reduce the volume or compass of. 2. To make more concise; abridge or shorten. 3. Physics a. Consolidated Balance Sheet consolidated balance sheet A balance sheet in which assets and liabilities of a parent company and its controlled subsidiaries are combined, thereby presenting balance sheet items for the parent and its subsidiaries as if they were a single firm. , Condensed Consolidated Statement of Cash Flows, Reconciliation of Adjusted Earnings per Share, and Parent Financial Information. Conference Call Information: AES will host a conference call today to discuss these results. The call will be held at 9:00am Eastern Daylight For other uses, see Daylight (disambiguation). Daylight or the light of day is the combination of all direct and indirect sunlight outdoors during the daytime (and perhaps twilight). Time (EDT EDT abbr. Eastern Daylight Time EDT Eastern Daylight Time EDT n abbr (US) (= Eastern Daylight Time) → hora de verano de Nueva York EDT ). The call may be accessed via a live webcast which will be available at www.aes.com or by telephone in listen-only mode at 1-877-692-2592. International callers should dial 1-973-582-2700. Please call at least five minutes before the scheduled start time. You will be requested to provide your name, e-mail address See Internet address. e-mail address - electronic mail address , and affiliation affiliation (  fil´ēā´sh . The AES
Second Quarter 2004 Financial Review presentation will also be available
at www.aes.com. This presentation includes a summary of updated AES
forward-looking for·ward-look·ingadj. Concerned with or making provision for the future: forward-looking educators; a forward-looking corporate plan. Adj. 1. guidance. A replay of the conference call will be available at www.aes.com and by telephone until 6:00pm EDT on Friday Friday: see Sabbath; week. Friday young Indian rescued by Crusoe and kept as servant and companion. [Br. Lit.: Robinson Crusoe] See : Servant , August 6, 2004. Safe Harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. Disclosure: This news release contains forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. within the meaning of the Securities Act of 1933 and of the Securities Exchange Act of 1934. Such forward-looking statements include, but are not limited to, those related to future earnings, growth and financial and operating performance. Forward-looking statements are not intended to be a guarantee of future results, but instead constitute AES's current expectations based on reasonable assumptions. Forecasted financial information is based on certain material assumptions. These assumptions include, but are not limited to continued normal levels of operating performance and electricity demand at our distribution companies and operational performance at our contract generation businesses consistent with historical levels. Actual results could differ materially from those projected in our forward-looking statements due to risks, uncertainties and other factors. Important factors that could affect actual results are discussed in AES's filings with the Securities and Exchange Commission, including, but not limited to the risks discussed under the caption "Cautionary Statements and Risk Factors" in AES's most recent annual report on Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. . Readers are encouraged to read AES's filings to learn more about the risk factors associated with AES's business. AES undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
AES CORPORATION
CONSOLIDATED STATEMENTS OF
OPERATIONS
Quarter Ended Six Months Ended
June 30, June 30,
($ in millions, except per share
amounts) 2004 2003 2004 2003
-------- ------- -------- -------
Revenues $ 2,263 $ 1,992 $ 4,520 $ 3,903
Cost of sales (1,615) (1,453) (3,192) (2,790)
------- ------- ------- -------
GROSS MARGIN 648 539 1,328 1,113
Corporate and business development
expenses (42) (32) (90) (61)
Other operating income (expense),
net 5 (16) 5 (38)
------- ------- ------- -------
OPERATING INCOME 611 491 1,243 1,014
Interest expense, net (390) (462) (814) (893)
Other nonoperating (expense)
income, net (4) 92 (18) 107
Foreign currency transaction
(losses) gain (55) 107 (63) 189
Loss on sale of investments - (24) (1) (24)
Equity in earnings of affiliates 23 21 39 45
------- ------- ------- -------
INCOME BEFORE INCOME TAXES AND
MINORITY INTEREST 185 225 386 438
Income tax expense (59) (66) (123) (127)
Minority interest expense, net (59) (20) (122) (41)
------- ------- ------- -------
INCOME FROM CONTINUING
OPERATIONS 67 139 141 270
Loss from operations of
discontinued components (net of
income tax benefits of $6, $24,
$4, and $28, respectively) (29) (268) (55) (304)
------- ------- ------- -------
INCOME (LOSS) BEFORE
CUMULATIVE EFFECT OF
ACCOUNTING CHANGE 38 (129) 86 (34)
Cumulative effect of accounting
change (net of income tax benefit
of $1) - - - (2)
------- ------- ------- -------
NET INCOME (LOSS) $ 38 $ (129) $ 86 $ (36)
======= ======= ======= =======
DILUTED EARNINGS (LOSS) PER
SHARE
Income from continuing operations $ 0.10 $ 0.24 $ 0.22 $ 0.47
Discontinued operations (0.04) (0.46) (0.09) (0.53)
Cumulative effect of accounting
change - - - -
------- ------- ------- -------
Total $ 0.06 $ (0.22) $ 0.13 $ (0.06)
======= ======= ======= =======
Diluted weighted average shares
outstanding (in millions) 643 583 638 575
======= ======= ======= =======
AES CORPORATION
SEGMENT INFORMATION
Six Months
Quarter Ended Ended
June 30, June 30,
($ in millions) 2004 2003 2004 2003
------ ------ ------ ------
BUSINESS SEGMENTS
REVENUES
Contract Generation $ 868 $ 735 $1,736 $1,451
Competitive Supply 248 196 491 425
Large Utilities 834 778 1,652 1,480
Growth Distribution 313 283 641 547
------ ------ ------ ------
Total revenues $2,263 $1,992 $4,520 $3,903
GROSS MARGIN
Contract Generation $ 326 $ 286 $ 685 $ 576
Competitive Supply 53 45 117 114
Large Utilities 207 163 401 328
Growth Distribution 62 45 125 95
------ ------ ------ ------
Total gross margin $ 648 $ 539 $1,328 $1,113
INCOME BEFORE INCOME TAXES AND
MINORITY INTEREST
Contract Generation $ 208 $ 142 $ 398 $ 311
Competitive Supply 38 41 93 111
Large Utilities 93 91 210 164
Growth Distribution 8 57 39 95
Corporate (162) (106) (354) (243)
------ ------ ------ ------
Total income before income taxes
and minority interest $ 185 $ 225 $ 386 $ 438
----------------------------------------------------------------------
GEOGRAPHIC SEGMENTS
REVENUES
North America $ 534 $ 507 $1,080 $1,053
Caribbean 407 373 797 720
South America 909 796 1,788 1,471
Europe/Africa 238 209 513 445
Asia 175 107 342 214
------ ------ ------ ------
Total revenues $2,263 $1,992 $4,520 $3,903
INCOME BEFORE INCOME TAXES AND
MINORITY INTEREST
North America $ 123 $ 100 $ 241 $ 219
Caribbean 52 20 113 77
South America 61 144 153 212
Europe/Africa 48 24 105 85
Asia 63 43 128 88
Corporate (162) (106) (354) (243)
------ ------ ------ ------
Total income before income taxes
and minority interest $ 185 $ 225 $ 386 $ 438
AES CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEET
December
June 30, 31,
($ in millions, except per share amounts) 2004 2003
--------- --------
ASSETS
CURRENT ASSETS
Cash and cash equivalents $ 1,248 $ 1,737
Restricted cash 303 288
Short term investments 150 189
Accounts receivable, net of reserves of $262
and $291, respectively 1,165 1,211
Inventory 366 376
Receivable from affiliates 3 3
Deferred income taxes - current 152 136
Prepaid expenses 87 64
Other current assets 804 677
Current assets of held for sale and
discontinued businesses 206 205
--------- --------
Total current assets 4,484 4,886
PROPERTY, PLANT AND EQUIPMENT
Land 710 733
Electric generation and distribution assets 21,538 21,076
Accumulated depreciation (4,797) (4,587)
Construction in progress 785 1,278
--------- --------
Property, plant and equipment, net 18,236 18,500
OTHER ASSETS
Deferred financing costs, net 468 430
Investment in and advances to affiliates 666 648
Debt service reserves and other deposits 615 617
Goodwill, net 1,376 1,378
Deferred income taxes - noncurrent 746 781
Long-term assets of held for sale and
discontinued businesses 700 750
Other assets 1,706 1,976
--------- --------
Total other assets 6,277 6,580
--------- --------
TOTAL ASSETS $ 28,997 $ 29,966
========= ========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable $ 1,083 $ 1,225
Accrued interest 352 561
Accrued and other liabilities 1,252 1,156
Current liabilities of held for sale and
discontinued businesses 752 699
Recourse debt-current portion - 77
Non-recourse debt-current portion 1,819 2,769
--------- --------
Total current liabilities 5,258 6,487
LONG-TERM LIABILITIES
Recourse debt 5,493 5,862
Non-recourse debt 11,025 10,930
Deferred income taxes 1,062 1,113
Long-term liabilities of held for sale and
discontinued businesses 15 94
Pension liabilities 865 947
Other long-term liabilities 2,939 3,083
--------- --------
Total long-term liabilities 21,399 22,029
Minority Interest, including discontinued
businesses of $12 and $12, respectively 1,166 805
STOCKHOLDERS' EQUITY
Common stock 6 6
Additional paid-in capital 5,465 5,737
Accumulated deficit (1,017) (1,103)
Accumulated other comprehensive loss (3,280) (3,995)
--------- --------
Total stockholders' equity 1,174 645
--------- --------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 28,997 $ 29,966
========= ========
AES CORPORATION
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
June 30, June 30,
($ in millions) 2004 2003
-------- --------
OPERATING ACTIVITIES
Net income $ 86 $ (36)
Adjustments:
Depreciation and amortization -- continuing
and discontinued operations 399 378
Cumulative effect of change in accounting
principle - 3
Other non-cash charges 419 85
Working capital, (net) (294) 306
-------- --------
Net cash provided by operating activities 610 736
INVESTING ACTIVITIES
Property additions (377) (573)
Proceeds from the sales of assets 36 689
Increase (decrease) in restricted cash and other 14 (243)
-------- --------
Net cash used in investing activities (327) (127)
FINANCING ACTIVITIES
Borrowings under the revolving credit
facilities, net - (8)
Issuance of non-recourse debt and other coupon
bearing securities 1,725 2,521
Repayments of non-recourse debt and other coupon
bearing securities (2,351) (2,604)
Payments for deferred financing costs (65) (68)
Issuance of common stock, net 4 335
Other financing (54) 4
-------- --------
Net cash (used in)/provided by financing
activities (741) 180
Effect of exchange rate changes on cash (34) 35
-------- --------
Total (decrease) increase in cash and cash
equivalents (492) 824
Increase in cash and cash equivalents of
discontinued operations and businesses held for
sale 3 57
Cash and cash equivalents, beginning 1,737 792
-------- --------
Cash and cash equivalents, ending $ 1,248 $ 1,673
======== ========
AES CORPORATION
RECONCILIATION OF ADJUSTED EARNINGS PER SHARE (1)
Quarter Six Months
Ended Ended
June 30, June 30,
($ per share) 2004 2003 2004 2003
----- ------ ------ ------
Adjusted Earnings Per Share $0.15 $0.05 $0.32 $0.18
FAS 133 Mark-to-Market Gains/(Losses)(2) (0.01)(0.03) (0.05) (0.05)
Currency Transaction Gains/(Losses) (0.04) 0.15 (0.03) 0.25
Net Asset Gains/(Losses and Impairments) - (0.02) - (0.02)
Debt Retirement Gains/(Losses) - 0.09 (0.02) 0.11
Diluted EPS From Continuing Operations $0.10 $0.24 $0.22 $0.47
(1) Adjusted earnings per share (a non-GAAP financial measure) is
defined as diluted earnings per share from continuing
operations excluding gains or losses associated with (a)
mark-to-market amounts related to FAS 133 derivative
transactions , (b) foreign currency transaction impacts on the
net monetary position related to Brazil, Venezuela, and
Argentina, (c) significant asset gains or losses due to
disposition transactions and impairments, and (d) early
retirement of recourse debt. AES believes that adjusted
earnings per share better reflect the underlying business
performance of the Company, and are considered in the
Company's internal evaluation of financial performance.
Factors in this determination include the variability
associated with mark-to-market gains or losses related to
certain derivative transactions, and periodic strategic
decisions to dispose of certain assets which may influence
results in a given period. Certain reclassifications have been
made to prior-period amounts to conform to the 2004
presentation.
(2) The Six Months Ended June 30, 2004 includes $(0.03) related to
Gener debt restructuring costs included in interest expense in
the first quarter of 2004.
NOTE: AES revised the definition of adjusted EPS in the second quarter
of 2004 to focus greater attention on only three key currencies
resulting in foreign currency transaction gains or losses on net
monetary positions (those of Brazil, Venezuela, and Argentina).
The prior definition included the effects of all foreign
currencies. In addition, only significant asset gains or losses
due to disposition transactions and impairments are included. The
prior definition included all asset gains or losses due to
disposition transactions and impairments. Finally, the revised
definition reflects the specific tax impact of each amount. The
result is no net effect on the adjusted earnings per share for the
first half of either 2003 or 2004, with some minor reallocation to
the first quarter of both 2003 and 2004, and a $0.03 increase in
the annual adjusted EPS for 2003 from $0.53 to $0.56.
AES CORPORATION
PARENT FINANCIAL INFORMATION
PARENT ONLY DATA: LAST FOUR
QUARTERS
($ in millions) 4 Quarters Ended
September December March June
TOTAL SUBSIDIARY DISTRIBUTIONS & 30, 31, 31, 30,
RETURNS OF CAPITAL TO PARENT 2003 2003 2004 2004
Actual Actual Actual Actual
--------- -------- ------- -------
Subsidiary distributions to Parent $909 $1,008 $1,076 $1,056
Net distributions to/(from) QHCs(1) 139 46 2 24
--------- -------- ------- -------
SUBSIDIARY DISTRIBUTIONS 1,048 1,054 1,078 1,080
Returns of capital distributions
to Parent 248 242 243 219
Net returns of capital
distributions to/(from) QHCs(1) (1) 0 0 (6)
--------- -------- ------- -------
RETURNS OF CAPITAL DISTRIBUTIONS 247 242 243 213
Combined distributions & return of
capital received 1,295 1,296 1,321 1,293
Less: combined net distributions &
returns of capital to/(from) QHCs
(1) (138) (46) (2) (18)
--------- -------- ------- -------
TOTAL SUBSIDIARY DISTRIBUTIONS &
RETURNS OF CAPITAL TO PARENT $1,157 $1,250 $1,319 $1,275
========= ======== ======= =======
PARENT ONLY DATA: QUARTERLY
($ in millions)
Quarter Ended
September December March June
Total subsidiary distributions & 30, 31, 31, 30,
returns of capital to Parent 2003 2003 2004 2004
Actual Actual Actual Actual
--------- -------- ------- -------
Subsidiary distributions to Parent $312 $248 $204 $292
Net distributions to/(from) QHCs(1) 7 7 0 10
--------- -------- ------- -------
SUBSIDIARY DISTRIBUTIONS 319 255 204 302
Returns of capital distributions
to Parent 199 17 3 0
Net returns of capital
distributions to/(from) QHCs(1) (7) 1 0 0
--------- -------- ------- -------
RETURNS OF CAPITAL DISTRIBUTIONS 192 18 3 -
Combined distributions & return of
capital received 511 273 207 302
Less: combined net distributions &
returns of capital to/(from) QHCs
(1) 0 (8) 0 (10)
--------- -------- ------- -------
TOTAL SUBSIDIARY DISTRIBUTIONS &
RETURNS OF CAPITAL TO PARENT $511 $265 $207 $292
========= ======== ======= =======
LIQUIDITY (2) Balance at
($ in millions) September December March June
June 30, 30, 31, 31, 30,
2003 2003 2003 2004 2004
Actual Actual Actual Actual Actual
--------- --------- -------- -------- -------
Cash at Parent $923 $525 $865 $268 $310
Availability under
revolver 39 172 180 371 331
Cash at QHCs (1) 29 41 26 17 15
--------- --------- -------- -------- -------
ENDING LIQUIDITY $991 $738 $1,071 $656 $656
========= ========= ======== ======== =======
(1) The cash held at qualifying holding companies (QHCs)
represents cash sent to subsidiaries of the company domiciled
outside of the US. Such subsidiaries had no contractual
restrictions on their ability to send cash to AES, the parent
company. Cash at those subsidiaries was used for investment
and related activities outside of the US. These investments
included equity investments and loans to other foreign
subsidiaries as well as development and general costs and
expenses incurred outside the US. Since the cash held by these
qualifying holding companies is available to the parent, AES
uses the combined measure of subsidiary distributions to
parent and qualified holding companies as a useful measure of
cash available to the parent to meet its international
liquidity needs.
(2) AES believes that unconsolidated parent company liquidity is
important to the liquidity position of AES as a Parent company
because of the non-recourse nature of most of AES's
indebtedness.
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