10-QPeriod: Q1 FY2018

AMEREN CORP Quarterly Report for Q1 Ended Mar 31, 2018

Filed May 9, 2018For Securities:AEE

Summary

Ameren Corporation (AEE) reported solid financial results for the first quarter ended March 31, 2018, with net income attributable to common shareholders increasing to $151 million, or $0.62 per diluted share, up from $102 million, or $0.42 per diluted share, in the prior year period. This growth was driven by several factors, including favorable rate adjustments and improved operational efficiencies at Ameren Missouri, coupled with stronger demand due to colder winter temperatures. Strategically, Ameren continued to focus on infrastructure investments, particularly in its transmission and distribution segments, aligning with its long-term plan to enhance reliability and environmental compliance. The company also made progress on its renewable energy initiatives, with Ameren Missouri pursuing wind generation acquisitions. While facing ongoing regulatory processes and potential cost pressures, Ameren's robust liquidity position and access to capital markets provide a stable foundation for future growth and shareholder returns.

Financial Highlights

49 data points
Beta

Revenue

$1.58B

Net Income

$151.00M

9.5% Net Margin

EPS (Diluted)

$0.62

Total Assets

$26.08B

Cash & Equivalents

$30.00M

Free Cash Flow

-$321.00M

Financial Statements
Beta
Revenue$1.58B
Operating Expenses$1.31B
Operating Income$273.00M
Interest Expense$101.00M
Net Income$151.00M
EPS (Basic)$0.62
EPS (Diluted)$0.62
Shares Outstanding (Basic)242.90M
Shares Outstanding (Diluted)244.40M

Key Highlights

  • 1Net income attributable to Ameren common shareholders increased by 48% to $151 million for the first quarter of 2018, compared to $102 million in the same period of 2017.
  • 2Diluted earnings per share rose to $0.62, a significant increase from $0.42 in the prior year's first quarter.
  • 3Total operating revenues grew to $1,585 million, up from $1,515 million in the first quarter of 2017.
  • 4Ameren Missouri's electric margins saw a substantial increase of $61 million, driven by favorable weather conditions and rate adjustments.
  • 5Capital expenditures increased by $75 million to $597 million, reflecting ongoing investments in infrastructure across various segments, particularly transmission and distribution.
  • 6The company maintained a strong liquidity position, with total liquidity of $1,169 million as of March 31, 2018.
  • 7Ameren Missouri is actively pursuing renewable energy projects, aiming to acquire at least 700 megawatts of wind generation.

Frequently Asked Questions

The primary drivers for the increase in net income were higher base rates and lower operational expenses at Ameren Missouri, partly due to a March 2017 electric rate order. Additionally, colder winter temperatures in the first quarter of 2018 led to increased demand, positively impacting results. Investments in infrastructure at Ameren Transmission and Ameren Illinois also contributed.

Ameren is strategically allocating significant capital to businesses supported by constructive regulatory frameworks. In the first three months of 2018, over $325 million was invested in FERC rate-regulated electric transmission and Illinois electric and natural gas distribution businesses. The company plans to invest up to $11.4 billion from 2018 through 2022 in its electric and natural gas utility infrastructure.

Ameren Missouri is actively pursuing renewable energy initiatives, including the acquisition of at least 700 megawatts of wind generation to comply with Missouri's renewable energy standards. They also plan to file for certificates of convenience and necessity for at least 400 megawatts of wind generation by June 30, 2018, and are considering requesting authorization for a Renewable Energy Standards Rate Adjustment Mechanism (RESRAM) to facilitate timely cost recovery for renewable investments.

The TCJA is expected to benefit customers through lower rates due to reduced federal statutory corporate income tax rates. While not expected to materially affect earnings, it is anticipated to impact cash flows and rate base in the near term. Ameren expects to offset near-term income tax obligations with existing net operating loss and tax credit carryforwards. Over time, higher rate base amounts, driven by lower accumulated deferred income taxes and the return of excess deferred taxes, are expected to partially offset the reduction in operating cash flows.