10-KPeriod: FY2015

AMEREN CORP Annual Report, Year Ended Dec 31, 2015

Filed February 26, 2016For Securities:AEE

Summary

Ameren Corporation's 2015 10-K filing highlights a company focused on investing in its regulated utilities, particularly in transmission infrastructure. The company reported stable operating revenues, with net income from continuing operations at $579 million. Key drivers for the year included increased investments in Ameren Illinois and ATXI's electric transmission businesses, which are supported by constructive regulatory frameworks. Despite warmer weather impacting sales volumes and a provision for discontinued nuclear unit efforts negatively affecting earnings, Ameren benefited from operational improvements and disciplined cost management. The company continues to navigate regulatory landscapes, with ongoing attention to environmental regulations and their potential impact on capital expenditures and operating costs. The Noranda customer situation presented a near-term challenge, impacting Ameren Missouri's sales volumes and revenue recovery, though the company was actively seeking regulatory and legislative solutions.

Financial Statements
Beta
Revenue$6.10B
Operating Expenses$4.84B
Operating Income$1.26B
Interest Expense$355.00M
Net Income$630.00M
EPS (Basic)$2.60
EPS (Diluted)$2.59
Shares Outstanding (Basic)242.60M
Shares Outstanding (Diluted)243.60M

Key Highlights

  • 1Ameren reported stable operating revenues of $6,098 million and income from continuing operations of $585 million ($2.38 per diluted share) for 2015.
  • 2The company continued its strategy of investing in rate-regulated infrastructure, with capital expenditures totaling $1.9 billion in 2015, primarily directed towards Ameren Illinois ($918 million) and ATXI ($375 million) for transmission projects.
  • 3Ameren Missouri discontinued efforts to license and build a second nuclear unit, resulting in a $69 million provision for capitalized costs.
  • 4The bankruptcy filing of Noranda, Ameren Missouri's largest customer, is expected to reduce 2016 earnings by an estimated $32 million, with the company seeking regulatory and legislative solutions.
  • 5Ameren Illinois' electric delivery service revenue requirement saw a $106 million increase starting in 2016, reflecting investments in modernization and reliability.
  • 6The company maintained strong liquidity with $2.1 billion in total liquidity available at December 31, 2015.
  • 7Ongoing FERC complaint cases challenging the allowed return on equity for MISO transmission owners could lead to potential refunds for Ameren Illinois and ATXI, with an estimated regulatory liability of $32 million and $45 million, respectively, recorded at year-end.

Frequently Asked Questions

In 2015, Ameren reported net income attributable to common shareholders of $630 million, or $2.59 per diluted share. Income from continuing operations was $579 million, or $2.38 per diluted share. Operating revenues were $6,098 million.

Ameren's capital investment strategy focuses on its regulated utilities, particularly in transmission infrastructure. In 2015, capital expenditures totaled $1.9 billion, with significant investments in Ameren Illinois ($918 million) for electric and natural gas transmission and distribution, and ATXI ($375 million) for transmission projects like the Illinois Rivers project.

Noranda, Ameren Missouri's largest customer, filed for Chapter 11 bankruptcy in early 2016, leading to a curtailment of operations. This is expected to result in significantly lower sales volumes for Ameren Missouri, impacting revenue recovery until rates are adjusted in a future rate case. Ameren Missouri estimates a $32 million reduction in 2016 earnings due to this situation.

Ameren is subject to regulation by the MoPSC, ICC, and FERC. Key regulatory matters include ongoing FERC complaint cases challenging the allowed return on equity for MISO transmission owners, which could lead to customer refunds for Ameren Illinois and ATXI. Additionally, the company is managing environmental regulations, such as the Clean Power Plan, which could significantly impact capital expenditures and operating costs. Ameren Missouri is also dealing with the outcome of a MoPSC staff complaint regarding performance incentives for energy efficiency programs.