8-KEarnings & ResultsRegulation FDExhibits & Filings

FIRSTENERGY CORP 8-K Report, Financial Results (Oct 29, 2015)

Filed October 29, 2015For Securities:FE

Summary

This 8-K filing from FirstEnergy Corp. (FE) on October 29, 2015, primarily serves as a notification of financial results for the periods ending September 30, 2015, as detailed in their accompanying Press Release and Consolidated Report. Notably, the company is emphasizing its use of non-GAAP financial measures such as "Operating earnings," "Adjusted Equity," "Adjusted Debt," and "Adjusted Capitalization." Management utilizes these measures to assess performance, manage operations, and monitor financial covenants, particularly the debt to total capitalization ratio which must remain at or below 65% under their credit facility. Investors should pay close attention to these non-GAAP figures as they provide management's perspective on operational performance, while also recognizing they are not direct replacements for GAAP measures.

Key Highlights

  • 1FirstEnergy Corp. announced its financial results for the three and nine months ended September 30, 2015.
  • 2The company is providing information through a Press Release (Exhibit 99.1) and a Consolidated Report to the Financial Community (Exhibit 99.2).
  • 3FirstEnergy is highlighting its use of non-GAAP financial measures, including "Operating earnings," "Adjusted Equity," "Adjusted Debt," and "Adjusted Capitalization."
  • 4These non-GAAP measures are used by management for performance evaluation, operational management, and decision-making.
  • 5"Operating earnings" exclude "special items" for a clearer view of ongoing operational performance.
  • 6The company uses "Adjusted Equity," "Adjusted Debt," and "Adjusted Capitalization" to track compliance with a debt to total capitalization ratio of no more than 65% as per its credit facility.
  • 7An investor FactBook, updated with information as of September 30, 2015, is expected to be posted on the company's website.

Frequently Asked Questions

FirstEnergy is emphasizing its use of non-GAAP financial measures such as "Operating earnings," "Adjusted Equity," "Adjusted Debt," and "Adjusted Capitalization." These are presented alongside their standard GAAP financial results and are detailed in their accompanying Press Release and Consolidated Report.

Management uses these non-GAAP measures to evaluate the company's performance, manage its operations, and facilitate historical and ongoing performance comparisons. They believe "Operating earnings" and "Basic EPS-Operating" provide a consistent view by excluding "special items," and that "Adjusted Equity," "Adjusted Debt," and "Adjusted Capitalization" are key for monitoring their debt covenants.

FirstEnergy uses "Adjusted Equity," "Adjusted Debt," and "Adjusted Capitalization" to monitor compliance with a financial covenant under its credit facility and term loan. This covenant requires the company to maintain a consolidated debt to total capitalization ratio of no more than 65% at the end of each fiscal quarter.

Detailed financial information is available in the Press Release (Exhibit 99.1) and the Consolidated Report to the Financial Community (Exhibit 99.2) attached to this 8-K filing. Additionally, an updated investor FactBook for the periods ending September 30, 2015, is expected to be posted on FirstEnergy's investor relations website.