8-KRegulation FDOther EventsExhibits & Filings

ENTERGY CORP /DE/ 8-K Report, Regulation FD Disclosure (Sep 22, 2020)

Filed September 22, 2020For Securities:ETR

Summary

Entergy Corporation (ETR) filed an 8-K on September 22, 2020, to disclose preliminary information regarding the financial impact of Hurricane Laura. The company estimates total restoration costs for damage to its electrical facilities to be between $1.5 billion and $1.7 billion, with the majority of these costs borne by Entergy Louisiana and Entergy Texas. These estimates include increased expenses due to the implementation of COVID-19 safety protocols during disaster response. In addition to restoration costs, Entergy anticipates a negative impact on its 2020 utility revenues, estimated between $35 million and $40 million, primarily due to power outages. The company stated that its liquidity remains sufficient, with approximately $4.0 billion in cash, available credit, and storm escrows as of August 31, 2020. Entergy is exploring all available avenues for cost recovery, including regulatory mechanisms, securitization, and potential federal assistance, aiming to minimize the impact on customers.

Key Highlights

  • 1Estimated Hurricane Laura restoration costs range from $1.5 billion to $1.7 billion.
  • 2The majority of restoration costs are attributed to Entergy Louisiana ($1.25B-$1.4B) and Entergy Texas ($0.23B-$0.26B).
  • 3COVID-19 safety protocols contributed to increased restoration costs.
  • 4Anticipated adverse impact on 2020 utility revenues is estimated at $35 million to $40 million.
  • 5Liquidity as of August 31, 2020, stands at approximately $4.0 billion (cash, revolver capacity, storm escrows).
  • 6Entergy is actively pursuing cost recovery through regulatory means, securitization, and potential federal assistance.
  • 7The company aims to minimize the financial impact on its customers.

Frequently Asked Questions

Entergy estimates total restoration costs for Hurricane Laura to be between $1.5 billion and $1.7 billion. Additionally, the company expects a negative impact on 2020 utility revenues of approximately $35 million to $40 million due to power outages.

Entergy is exploring multiple avenues for cost recovery, including existing regulatory mechanisms, storm escrows, securitization, and potential federal assistance. The company is working collaboratively with regulators to achieve recovery in a manner that minimizes the impact on customers.

Yes, Entergy stated that its liquidity is sufficient. As of August 31, 2020, the company had approximately $4.0 billion in cash, available revolving credit capacity, and storm escrows, which it believes is adequate to meet current obligations.

Yes, the restoration efforts for Hurricane Laura were impacted by the need to implement COVID-19 safety protocols. Increased costs associated with these measures, such as lodging and personal protective equipment, are included in the preliminary cost estimates.