Year-over-year GAAP results primarily reflect the 2009 gain on the EDF transaction, as compared to merger-related costs and impairment losses incurred during 2008
– By Stephen Heiser
Constellation Energy has reported adjusted earnings of $3.36 per share for the full year 2009, compared to $3.57 per share in 2008. Adjusted earnings exclude the cumulative effects of changes in accounting principles, discontinued operations and special items (which are defined as significant items that are not related to our ongoing, underlying business or which distort comparability of results). On a generally accepted accounting principles (GAAP) basis, the company earned $22.19 per share in 2009, as compared to a loss of $7.34 per share in 2008. Year-over-year GAAP results primarily reflect the 2009 gain on the EDF transaction, as compared to merger-related costs and impairment losses incurred during 2008.
“Despite a challenging market environment, 2009 was a year of strong financial progress, across-the-board operational excellence and comprehensive strategic transformation”
Constellation Energy reaffirmed its 2010 earnings guidance of $3.05 to $3.45 per share and introduced 2011 earnings guidance of $3.45 to $3.85 per share.
“Despite a challenging market environment, 2009 was a year of strong financial progress, across-the-board operational excellence and comprehensive strategic transformation,” said Mayo A. Shattuck III, chairman, president and chief executive officer, Constellation Energy. “We successfully completed our strategic objectives announced in 2009 to de-risk and strengthen the company. We successfully closed our nuclear joint venture with EDF and divested our non-core trading and marketing businesses. We more than doubled net available liquidity with a focus on managing collateral exposure and entering into new liquidity facilities specifically tailored to our on-going businesses. During the year, we retired approximately $3.7 billion of outstanding debt and significantly increased our cash position. Importantly, the three major rating agencies reaffirmed Constellation Energy’s investment grade rating. We completed these de-risking initiatives in less time and at a lower cost than originally anticipated, while maintaining a focus on our core activities – producing, selling and distributing power and gas efficiently and safely to our customers.
“We are committed to further streamlining our businesses, making Constellation Energy a leaner, more focused company poised for growth,” said Shattuck. “Aggressive pursuit of cost savings and capital efficiency, as well as a balanced, asset-backed investment strategy, is vital to our continued competitiveness. BGE is seeking approval in Maryland to roll out one of the most ambitious Smart Grid programs in the nation, which is expected to deliver $2.6 billion in customer savings. Through our UniStar partnership with EDF, we continue to participate in new nuclear development. The Department of Energy loan guarantee remains one of the critical investment components, and we are hopeful that a positive decision will be forthcoming.
“Looking ahead, we believe that a stronger Constellation Energy is well positioned to grow in 2010 and beyond,” Shattuck said.