NRG Energy

NRG Energy, Inc. Reports Third Quarter Results, Remains On Track with Transformation Plan and Initiates 2018 Financial Guidance

Key Highlights

  • Transformation Plan on track with $92 million in cost savings realized through September 30, 2017
  • Initiating 2018 Adjusted EBITDA and FCFbG guidance
  • Repurchased $604 million1 of corporate debt, delivering approximately $47 million of annualized interest savings, completing 2017 capital allocation plan
  • Closed drop down of a 38 MW portfolio of solar assets to NRG Yield and formed a new partnership with NRG Yield focused primarily on community solar projects

PRINCETON, N.J.--(BUSINESS WIRE)--Nov. 2, 2017-- NRG Energy, Inc. (NYSE: NRG) today reported third quarter income from continuing operations of $190 million. Income from continuing operations for the first nine months of 2017 of $120 million, or $0.58 per diluted common share, compares to a loss from continuing operations of $92 million, or $0.10 per diluted common share for the first nine months of 2016. Adjusted EBITDA for the three and nine months ended September 30, 2017, was $806 million and $1,876 million, respectively. Year-to-date cash from continuing operations totaled $844 million.

“I am pleased with the progress we have made on our Transformation Plan,” said Mauricio Gutierrez, NRG President and Chief Executive Officer. “While we executed well in the third quarter, our results were impacted by mild temperatures and Hurricane Harvey. I am encouraged by the market recovery in Texas and the multiple regulatory initiatives that highlight the urgent need for power market reform.”

   

Consolidated Financial Results

Three Months Ended Nine Months Ended
($ in millions) 9/30/17   9/30/16 9/30/17   9/30/16
Income/(Loss) from Continuing Operations $ 190 $ 128 $ 120 $ (92 )
Cash From Continuing Operations $ 732 $ 794 $ 844 $ 1,674
Adjusted EBITDA $ 806 $ 895 $ 1,876 $ 2,234
Free Cash Flow Before Growth Investments (FCFbG)   $ 599     $ 726     $ 807     $ 985  
 

1 Comprised of $398 million of 2018 Senior Notes and $206 million of 2021 Senior Notes. Transaction completed in October 2017 at total cost of $615 million.

Segment Results

   

Table 1: Income/(Loss) from Continuing Operations

($ in millions) Three Months Ended Nine Months Ended
Segment 9/30/17   9/30/16 9/30/17   9/30/16
Generation $ 258 $ 372 $ 200 $ (49 )
Retail 69 (78 ) 380 734
Renewables 1 (4 ) 2 (84 ) (107 )
NRG Yield 1 41 50 85 116
Corporate (174 ) (218 ) (461 ) (786 )
Income/(Loss) from Continuing Operations 2 $ 190   $ 128   $ 120   $ (92 )

1. In accordance with GAAP, 2016 results have been restated to include full impact of the assets in the NRG Yield Drop Down transactions which closed on
September 1, 2016, March 27, 2017, and August 1, 2017.
2. Includes mark-to-market gains and losses of economic hedges.

 

   

Table 2: Adjusted EBITDA

($ in millions) Three Months Ended Nine Months Ended
Segment 9/30/17   9/30/16 9/30/17   9/30/16
Generation 1 $ 226 $ 268 $ 431 $ 750
Retail 276 304 612 677
Renewables 2 66 77 148 143
NRG Yield 2 265 252 719 707
Corporate (27 ) (6 ) (34 ) (43 )
Adjusted EBITDA 3 $ 806   $ 895   $ 1,876   $ 2,234  

1. Generation regional Reg G reconciliations are included in Appendices A-1 through A-4.
2. In accordance with GAAP, 2016 results have been restated to include full impact of the assets in the NRG Yield Drop Down transactions, which closed on
September 1, 2016, March 27, 2017, and August 1, 2017.
3. See Appendices A-1 through A-4 for Operating Segment Reg G reconciliations.

 

Generation: Third quarter Adjusted EBITDA was $226 million, $42 million lower than third quarter 2016 primarily driven by:

  • Gulf Coast: $46 million decrease due to lower realized energy prices and lower generation, partially offset by lower operating expenses, net of outages due to flooding in the region.
  • East/West1: $4 million increase from higher capacity revenues, partially offset by lower energy margins and unfavorable trading results in BETM.

Retail: Third quarter Adjusted EBITDA was $276 million, $28 million lower than third quarter 2016 due to mild weather, impacts from Hurricane Harvey, and higher supply costs, partially offset by customer growth and reduced operating costs.

Renewables: Third quarter Adjusted EBITDA was $66 million, $11 million lower than third quarter 2016 due to lower solar generation at Ivanpah and higher operating expenses.

NRG Yield: Third quarter Adjusted EBITDA was $265 million, $13 million higher than third quarter 2016 due to the acquisition of the Utah utility-scale solar portfolio and higher conventional availability, partially offset by lower renewable resources in the current quarter.

Corporate: Third quarter Adjusted EBITDA was $(27) million, $21 million lower than the third quarter 2016 due to a reduction in shared service income, partially offset by lower corporate marketing expenses and the elimination of operating losses at residential solar following its full wind down of operations.

1 Includes International, BETM and generation eliminations.

Liquidity and Capital Resources

   

Table 3: Corporate Liquidity

($ in millions) 9/30/17 12/31/16
Cash at NRG-Level 1 $ 383 $ 570
Revolver Availability 1,604 989
NRG-Level Liquidity $ 1,987 $ 1,559
Restricted Cash 537 446
Cash at Non-Guarantor Subsidiaries   225   368
Total Liquidity   $ 2,749   $ 2,373

1. Composed of cash of $998 million as of 9/30/2017, including unrestricted cash held at Midwest Generation (a non-guarantor subsidiary), which can be
distributed to NRG without limitation, pro-forma for $615 million of corporate debt repurchases completed in October 2017.

 

NRG-Level cash as of September 30, 2017, pro-forma for the debt repurchases completed in October 2017, was $383 million, a decrease of $187 million from December 31, 2016. As of September 30, 2017, total liquidity was $2.7 billion, including $1,604 million of the Company’s credit facilities, as well as $537 million restricted cash and $225 million cash at non-guarantor subsidiaries (primarily NRG Yield).

NRG Strategic Developments

Transformation Plan

As of the end of the third quarter of 2017, NRG has realized $92 million, or 142%, of its 2017 cost savings target as part the previously announced Transformation Plan. With respect to the targeted asset sales under the Transformation Plan, NRG continues to expect up to $4 billion of net cash proceeds, with transactions leading to a majority of those proceeds announced by year end 2017, and the balance in 2018. NRG anticipates these sales to include 100% of its interest in NRG Yield and its Renewables platform.

NRG Yield

Closed the November 2017 Drop Down Transaction

On November 1, 2017, NRG sold a 38 MW solar portfolio to NRG Yield primarily comprised of assets from NRG's Solar Power Partners (SPP) funds, in addition to other projects developed by NRG for cash consideration of $71 million, excluding working capital adjustments.

Investment Partnership with NRG Yield

Pursuant to the ROFO Agreement on September 26, 2017, NRG formed a new investment partnership in which NRG Yield would invest up to $50 million in a portfolio of distributed solar assets, primarily comprised of community solar projects, developed by NRG.

Drop Down Offer to NRG Yield

Pursuant to the ROFO Agreement, NRG offered NRG Yield the opportunity to acquire Buckthorn Solar, a 154 MW solar facility located near Fort Stockton, Texas with a 25-year PPA with the City of Georgetown.

Outlook for 2017 and Initiation of 2018 Guidance

NRG has decreased and narrowed the range of its Adjusted EBITDA and FCF before growth investments guidance for 2017 and is initiating guidance for fiscal year 2018. The 2018 guidance does not include the impact from targeted asset sales announced on July 12, 2017, as part of the Transformation Plan.

     

Table 4: 2017 and 2018 Adjusted EBITDA and FCF before Growth Investments Guidance

    2017   2017   2018
($ in millions)   Prior Guidance   Revised Guidance   Guidance
Adjusted EBITDA1 $2,565 - $2,765 $2,400 - $2,500 $2,800 - $3,000
Cash From Operations $1,760 - $1,960 $1,600 - $1,700 $2,015 - $2,215
Free Cash Flow Before Growth Investments (FCFbG)   $1,290 - $1,490   $1,175 - $1,275   $1,550 - $1,750

1. Non-GAAP financial measure; see Appendix Tables A-1 through A-5 for GAAP Reconciliation to Net Income that excludes fair value adjustments related to
derivatives. The Company is unable to provide guidance for Net Income due to the impact of such fair value adjustments related to derivatives in a given year.

 

Capital Allocation Update

In October 2017, the Company redeemed $398 million of its 7.625% 2018 Senior Notes through a tender offer at an early redemption percentage of 101.42%, and $206 million of its 7.875% 2021 Senior Notes through a tender offer at an average early redemption percentage of 102.625%. This generated approximately $47 million of annualized interest savings and extended the Company's nearest corporate bond maturity to July 2022.

On October 18, 2017, NRG declared a quarterly dividend on the company's common stock of $0.03 per share, payable November 15, 2017, to stockholders of record as of November 1, 2017. This represents $0.12 on an annualized basis.

The Company’s common stock dividend, debt reduction and share repurchases are subject to available capital, market conditions and compliance with associated laws and regulations.

Earnings Conference Call

On November 2, 2017, NRG will host a conference call at 8:00 a.m. Eastern to discuss these results. Investors, the news media and others may access the live webcast of the conference call and accompanying presentation materials by logging on to NRG’s website at http://www.nrg.com and clicking on “Investors.” The webcast will be archived on the site for those unable to listen in real time.

About NRG

NRG is the leading integrated competitive power company in the U.S., built on the strength of our diverse competitive electric generation portfolio and leading retail electricity platform. A Fortune 500 company, NRG creates value through best-in-class operations, reliable and efficient electric generation, and a retail platform serving residential and commercial businesses. Working with electricity customers large and small, we implement sustainable solutions for producing and managing energy, developing smarter energy choices and delivering exceptional service as our retail electricity providers serve almost three million residential and commercial customers throughout the country. More information is available at www.nrg.com. Connect with NRG Energy on Facebook and follow us on Twitter @nrgenergy.

Safe Harbor Disclosure

In addition to historical information, the information presented in this press release includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Exchange Act. These statements involve estimates, expectations, projections, goals, assumptions, known and unknown risks and uncertainties and can typically be identified by terminology such as “may,” “should,” “could,” “objective,” “projection,” “forecast,” “goal,” “guidance,” “outlook,” “expect,” “intend,” “seek,” “plan,” “think,” “anticipate,” “estimate,” “predict,” “target,” “potential” or “continue” or the negative of these terms or other comparable terminology. Such forward-looking statements include, but are not limited to, statements about the Company’s future revenues, income, indebtedness, capital structure, plans, expectations, objectives, projected financial performance and/or business results and other future events, and views of economic and market conditions.

Although NRG believes that its expectations are reasonable, it can give no assurance that these expectations will prove to be correct, and actual results may vary materially. Factors that could cause actual results to differ materially from those contemplated herein include, among others, general economic conditions, hazards customary in the power industry, weather conditions, including wind and solar performance, competition in wholesale power markets, the volatility of energy and fuel prices, failure of customers to perform under contracts, changes in the wholesale power markets, changes in government regulations, the condition of capital markets generally, our ability to access capital markets, unanticipated outages at our generation facilities, adverse results in current and future litigation, failure to identify, execute or successfully implement acquisitions, repowerings or asset sales, our ability to implement value enhancing improvements to plant operations and companywide processes, our ability to implement and execute on our publicly announced transformation plan, including any cost savings, margin enhancement, asset sale, and net debt targets, our ability to proceed with projects under development or the inability to complete the construction of such projects on schedule or within budget, risks related to project siting, financing, construction, permitting, government approvals and the negotiation of project development agreements, our ability to progress development pipeline projects, the timing or completion of the GenOn restructuring, the inability to maintain or create successful partnering relationships, our ability to operate our businesses efficiently, our ability to retain retail customers, our ability to realize value through our commercial operations strategy and the creation of NRG Yield, the ability to successfully integrate businesses of acquired companies, our ability to realize anticipated benefits of transactions (including expected cost savings and other synergies) or the risk that anticipated benefits may take longer to realize than expected, our ability to close the Drop Down transactions with NRG Yield, and our ability to execute our Capital Allocation Plan. Debt and share repurchases may be made from time to time subject to market conditions and other factors, including as permitted by United States securities laws. Furthermore, any common stock dividend is subject to available capital and market conditions.

NRG undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. The adjusted EBITDA and free cash flow guidance are estimates as of November 2, 2017. These estimates are based on assumptions the company believed to be reasonable as of that date. NRG disclaims any current intention to update such guidance, except as required by law. The foregoing review of factors that could cause NRG’s actual results to differ materially from those contemplated in the forward-looking statements included in this press release should be considered in connection with information regarding risks and uncertainties that may affect NRG's future results included in NRG's filings with the Securities and Exchange Commission at www.sec.gov.

   

NRG ENERGY, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)

Three months ended
September 30,

Nine months ended
September 30,

(In millions, except for per share amounts)

2017   2016 2017   2016
Operating Revenues
Total operating revenues $ 3,049   $ 3,421   $ 8,132   $ 8,328  
Operating Costs and Expenses
Cost of operations 2,156 2,440 5,852 5,711
Depreciation and amortization 272 298 789 826
Impairment losses 14 9 77 65
Selling, general and administrative 213 277 697 801
Reorganization 18 18
Development activity expenses 14   21   49   65  
Total operating costs and expenses 2,687 3,045 7,482 7,468
Other income - affiliate 14 48 104 144
Gain/(loss) on sale of assets   4   4   (79 )
Operating Income 376   428   758   925  
Other Income/(Expense)
Equity in earnings of unconsolidated affiliates 27 16 29 13
Impairment loss on investment (8 ) (147 )
Other income, net 15 7 33 29
Loss on debt extinguishment, net (1 ) (50 ) (3 ) (119 )
Interest expense (221 ) (237 ) (692 ) (718 )
Total other expense (180 ) (272 ) (633 ) (942 )
Income/(Loss) from Continuing Operations Before Income Taxes 196 156 125 (17 )
Income tax expense 6   28   5   75  
Income/(Loss) from Continuing Operations 190 128 120 (92 )
(Loss)/Income from discontinued operations, net of income tax (27 ) 265   (802 ) 256  
Net Income/(Loss) 163   393   (682 ) 164  

Less: Net loss attributable to noncontrolling interest and redeemable
noncontrolling interests

(8 ) (9 ) (63 ) (49 )
Net Income/(Loss) Attributable to NRG Energy, Inc. 171 402 (619 ) 213
Dividends for preferred shares 5
Gain on redemption of preferred shares       (78 )
Net Income/(Loss) Available for Common Stockholders $ 171   $ 402   $ (619 ) $ 286  

Income/(Loss) per Share Attributable to NRG Energy, Inc. Common
Stockholders

Weighted average number of common shares outstanding — basic 317 316 317 315

Income from continuing operations per weighted average common share
— basic

$ 0.63 $ 0.43 $ 0.58 $ 0.10

(Loss)/Income from discontinued operations per weighted average common
share — basic

$ (0.09 ) $ 0.84   $ (2.53 ) $ 0.81  
Income/(Loss) per Weighted Average Common Share — Basic $ 0.54   $ 1.27   $ (1.95 ) $ 0.91  
Weighted average number of common shares outstanding — diluted 322 317 317 316

Income from continuing operations per weighted average common share —
diluted

$ 0.61 $ 0.43 $ 0.58 $ 0.10

(Loss)/Income from discontinued operations per weighted average common
share — diluted

$ (0.08 ) $ 0.84 $ (2.53 ) $ 0.81
Income/(Loss) per Weighted Average Common Share — Diluted $ 0.53   $ 1.27   $ (1.95 ) $ 0.91  
Dividends Per Common Share $ 0.03   $ 0.03   $ 0.09   $ 0.21  
 
   

NRG ENERGY, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME/(LOSS)
(Unaudited)

Three months ended
September 30,

Nine months ended
September 30,

2016   2015 2017   2016
(In millions)
Net income/(loss) $ 163 $ 393 $ (682 ) $ 164
Other comprehensive income/(loss), net of tax

Unrealized gain/(loss) on derivatives, net of income tax
(benefit)/expense of $0, $(1), $1, and $1

7 27 6 (8 )

Foreign currency translation adjustments, net of income tax
expense of $0, $0, $0, and $0

2 3 10 6

Available-for-sale securities, net of income tax expense of
$0, $0, $0, and $0

1 2 1

Defined benefit plans, net of income tax expense of $0, $0,
$0, and $0

(1 ) 31   26   32  
Other comprehensive income 9   61   44   31  
Comprehensive income/(loss) 172 454 (638 ) 195

Less: Comprehensive loss attributable to noncontrolling
interest and redeemable noncontrolling interests

(5 ) (2 ) (61 ) (70 )

Comprehensive income/(loss) attributable to NRG Energy,
Inc.

177 456 (577 ) 265
Dividends for preferred shares 5
Gain on redemption of preferred shares       (78 )

Comprehensive income/(loss) available for common
stockholders

$ 177   $ 456   $ (577 ) $ 338  
 
   

NRG ENERGY, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS

September 30,
2017

December 31, 2016

(In millions, except shares)

(unaudited)  
ASSETS
Current Assets
Cash and cash equivalents $ 1,223 $ 938
Funds deposited by counterparties 31 2
Restricted cash 537 446
Accounts receivable, net 1,274 1,058
Inventory 630 721
Derivative instruments 475 1,067
Cash collateral posted in support of energy risk management activities 203 150
Current assets - held for sale 33 9
Prepayments and other current assets 354 404
Current assets - discontinued operations   1,919  
Total current assets 4,760   6,714  
Property, plant and equipment, net 15,332   15,369  
Other Assets
Equity investments in affiliates 1,138 1,120
Notes receivable, less current portion 5 16
Goodwill 662 662
Intangible assets, net 1,838 1,973
Nuclear decommissioning trust fund 670 610
Derivative instruments 206 181
Deferred income taxes 205 225
Non-current assets held-for-sale 10 10
Other non-current assets 644 841
Non-current assets - discontinued operations   2,961  
Total other assets 5,378   8,599  
Total Assets $ 25,470   $ 30,682  
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current Liabilities
Current portion of long-term debt and capital leases $ 1,247 $ 516
Accounts payable 911 813
Derivative instruments 522 1,092
Cash collateral received in support of energy risk management activities 31 81
Accrued expenses and other current liabilities 830 990
Accrued expenses and other current liabilities - affiliate 164
Current liabilities - discontinued operations   1,210  
Total current liabilities 3,705   4,702  
Other Liabilities
Long-term debt and capital leases 15,658 15,957
Nuclear decommissioning reserve 265 287
Nuclear decommissioning trust liability 397 339
Deferred income taxes 21 20
Derivative instruments 307 284
Out-of-market contracts, net 213 230
Non-current liabilities held-for-sale 13 11
Other non-current liabilities 1,116 1,176
Non-current liabilities - discontinued operations   3,184  
Total non-current liabilities 17,990   21,488  
Total Liabilities 21,695   26,190  
Redeemable noncontrolling interest in subsidiaries 85 46
Commitments and Contingencies
Stockholders’ Equity
Common stock 4 4
Additional paid-in capital 8,369 8,358
Retained deficit (4,713 ) (3,787 )
Less treasury stock, at cost — 101,580,045 and 102,140,814 shares, respectively (2,386 ) (2,399 )
Accumulated other comprehensive loss (91 ) (135 )
Noncontrolling interest 2,507   2,405  
Total Stockholders’ Equity 3,690   4,446  
Total Liabilities and Stockholders’ Equity $ 25,470   $ 30,682  
 

 

NRG ENERGY, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)

Nine months ended September 30,
2017   2016
(In millions)
Cash Flows from Operating Activities
Net (loss)/income (682 ) 164
(Loss)/Income from discontinued operations, net of income tax (802 ) 256  
Income/(loss) from continuing operations $ 120 $ (92 )
Adjustments to reconcile net (loss)/income to net cash provided by operating activities:
Distributions and equity in earnings of unconsolidated affiliates 24 44
Depreciation and amortization 789 826
Provision for bad debts 57 36
Amortization of nuclear fuel 37 39
Amortization of financing costs and debt discount/premiums 44 42
Adjustment for debt extinguishment 3 119
Amortization of intangibles and out-of-market contracts 79 131
Amortization of unearned equity compensation 27 23
Impairment losses 77 211
Changes in deferred income taxes and liability for uncertain tax benefits 26 29
Changes in nuclear decommissioning trust liability 20 24
Changes in derivative instruments 25 30
Changes in collateral posted in support of risk management activities (103 ) 261
Proceeds from sale of emission allowances 21 11
(Gain)/loss on sale of assets (22 ) 70
Changes in other working capital (380 ) (130 )
Cash provided by continuing operations 844 1,674
Cash (used)/provided by discontinued operations (38 )   67  
Net Cash Provided by Operating Activities 806   1,741  
Cash Flows from Investing Activities
Acquisitions of businesses, net of cash acquired (36 ) (18 )
Capital expenditures (760 ) (659 )
Decrease in notes receivable 11 2
Purchases of emission allowances (47 ) (32 )
Proceeds from sale of emission allowances 105 47
Investments in nuclear decommissioning trust fund securities (402 ) (378 )
Proceeds from the sale of nuclear decommissioning trust fund securities 382 354
Proceeds from renewable energy grants and state rebates 8 11
Proceeds from sale of assets, net of cash disposed of 36 84
Investments in unconsolidated affiliates (31 ) (23 )
Other 22   31  
Cash used by continuing operations (712 ) (581 )
Cash (used)/provided by discontinued operations (53 ) 326  
Net Cash Used by Investing Activities (765 ) (255 )
Cash Flows from Financing Activities
Payment of dividends to common and preferred stockholders (28 ) (66 )
Payment for preferred shares (226 )
Net receipts from settlement of acquired derivatives that include financing elements 2 6
Proceeds from issuance of long-term debt 1,134 5,237
Payments for short and long-term debt (712 ) (5,353 )
Receivable from affiliate (125 )
Payments for debt extinguishment costs (98 )
Contributions from, net of distributions to, noncontrolling interest in subsidiaries 65 (127 )
Proceeds from issuance of stock 1
Payment of debt issuance costs (43 ) (70 )
Other - contingent consideration (10 ) (10 )
Cash provided/(used) by continuing operations 283 (706 )
Cash (used)/provided by discontinued operations (224 ) 119  
Net Cash provided/(used) by Financing Activities 59   (587 )
Effect of exchange rate changes on cash and cash equivalents (10 ) (6 )
Change in Cash from discontinued operations (315 ) 512  

Net Increase in Cash and Cash Equivalents, Funds Deposited by Counterparties and Restricted
Cash

405 381

Cash and Cash Equivalents, Funds Deposited by Counterparties and Restricted Cash at Beginning
of Period

1,386   1,322  

Cash and Cash Equivalents, Funds Deposited by Counterparties and Restricted Cash at End of
Period

$ 1,791   $ 1,703  
 
                 

Appendix Table A-1: Third Quarter 2017 Adjusted EBITDA Reconciliation by Operating Segment
The following table summarizes the calculation of Adj. EBITDA and provides a reconciliation to income/(loss) from
continuing operations:

($ in millions)    

Gulf
Coast

 

East/
West(a)

  Generation   Retail   Renewables  

NRG
Yield

 

Corp/
Elim

  Total

Income/(Loss) from
Continuing Operations

   

166

    92     258     69     (4 )   41     (174 )   190  
Plus:
Interest expense, net 0 5 5 1 24 75 112 217
Income tax (2 ) 2 (3 ) 8 1 6
Depreciation and amortization 69 27 96 29 51 88 8 272
ARO Expense 4 3 7 1 1 9
Contract amortization 2 1 3 (1 ) 1 18 (1 ) 20
Lease amortization     0     (2 )   (2 )                   (2 )
EBITDA 239 128 367 98 70 231 (54 ) 712

Adjustment to reflect NRG
share of adjusted EBITDA in
unconsolidated affiliates

(6 ) 7 1 (3 ) (12 ) 32 10 28

Acquisition-related transaction
& integration costs

3 3
Reorganization costs 3 3 5 10 18
Deactivation costs 2 2 5 7
Other non recurring charges 1 (4 ) (3 ) 2 2 (1 )
Impairments 1 1 13 14

Mark to market (MtM)
(gains)/losses on economic
hedges

    (135 )   (10 )   (145 )   174     (5 )           24  
Adjusted EBITDA 102 124 226 276 66 265 (27 ) 806

(a) Includes International, BETM and generation eliminations.

 
                 

Third Quarter 2017 condensed financial information by Operating Segment:

($ in millions)    

Gulf
Coast

 

East/
West(a)

  Generation   Retail   Renewables   NRG Yield  

Corp/
Elim

  Total
Operating revenues 655 431 1,086 1,936 140 282 (409 ) 3,035
Cost of sales     394     202     596     1,458     4     15     (394 )   1,679  
Economic gross margin 261 229 490 478 136 267 (15 ) 1,356

Operations &
maintenance and other
cost of operations (b)

143 101 244 87 34 62 (15 ) 412

Selling, marketing,
general and
administrative(c)

26 13 39 107 14 4 31 195
Other expense/(income)(d)     (10 )   (9 )   (19 )   8     22     (64 )   (4 )   (57 )
Adjusted EBITDA     102     124     226     276     66     265     (27 )   806  

(a) Includes International, BETM and generation eliminations.
(b) Excludes deactivation costs of $7 million.
(c) Excludes reorganization costs of $18 million.
(d) Excludes impairments of $14 million, and acquisition and integration costs of $3 million.

 
             

The following table reconciles the condensed financial information to Adjusted EBITDA:

($ in millions)    

Condensed
financial
information

 

Interest, tax,
depr., amort.

  MtM   Deactivation   Other adj.   Adjusted EBITDA
Operating revenues 3,049 12 (26 ) 3,035
Cost of operations     1,737     (8 )   (50 )           1,679  
Gross margin 1,312 20 24 1,356

Operations & maintenance
and other cost of operations

419 (7 ) 412

Selling, marketing, general
& administrative (a)

213 (18 ) 195
Other expense/(income)(b)     490     (272 )           (275 )   (57 )

Income/(Loss) from
Continuing Operations

    190     292     24     7     293     806  

(a) Other adj. includes reorganization costs of $18 million.
(b) Other adj, includes impairments of $14 million, and acquisition and integration costs of $3 million.

 

                 

Appendix Table A-2: Third Quarter 2016 Adjusted EBITDA Reconciliation by Operating Segment

The following table summarizes the calculation of Adjusted EBITDA and provides a reconciliation to income/(loss) from
continuing operations:

($ in millions)    

Gulf
Coast

 

East/
West(a)

  Generation   Retail   Renewables  

NRG
Yield

 

Corp/
Elim

  Total

Income/(Loss) from
Continuing Operations

    224     148     372     (78 )   2     50    

(218

)

  128  
Plus:
Interest expense, net 7 7 (1 ) 34 70 124 234
Income tax (2 ) (2 ) (3 ) 13 20 28

Loss on debt
extinguishment

50 50

Depreciation and
amortization

108 26 134 26 48 75 15 298
ARO Expense 3 (6 ) (3 ) 1 (2 )
Contract amortization 5 0 5 1 1 17 (1 ) 23
Lease amortization         (2 )   (2 )                   (2 )
EBITDA 340 171 511 (52 ) 82 226 (10 ) 757

Adjustment to reflect NRG
share of adjusted EBITDA
in unconsolidated affiliates

(1 ) 8 7 (4 ) 26 (2 ) 27

Acquisition-related
transaction & integration
costs

1 1
Reorganization costs 6 6
Deactivation costs 1 1 1 2
Gain on sale of assets (4 ) (4 )
Other non recurring charges 15 (5 ) 10 (2 ) 2 10
Impairments 9 9 9

Mark to market (MtM)
(gains)/losses on economic
hedges

    (206 )   (64 )   (270 )   358     (1 )           87  
Adjusted EBITDA     148     120     268     304     77     252     (6 )   895  

(a) Includes International, BETM and generation eliminations.

 

                 

Third Quarter 2016 condensed financial information by Operating Segment:

($ in millions)    

Gulf
Coast

 

East/
West(a)

  Generation   Retail   Renewables  

NRG
Yield

 

Corp/
Elim

  Total
Operating revenues 773 523 1,296 2,009 139 289 (362 ) 3,371
Cost of sales     431     273     704     1,485     3     18     (363 )   1,847  
Economic gross margin 342 250 592 524 136 271 1 1,524

Operations & maintenance
and other cost of
operations (b)

162 106 268 81 25 58 (1 ) 431

Selling, marketing, general
& administrative (c)

35 29 64 137 12 4 54 271
Other expense/(income) (d)     (3 )   (5 )   (8 )   2     22     (43 )   (46 )   (73 )
Adjusted EBITDA     148     120     268     304     77     252     (6 )   895  

(a) Includes International, BETM and generation eliminations.
(b) Excludes deactivation costs of $2 million.
(c) Excludes reorganization costs of $6 million.
(d) Excludes loss on debt extinguishment of $50 million, impairments of $9 million, gain on sale of assets of $4 million, and acquisition and integration
costs of $1 million.

 

             

The following table reconciles the condensed financial information to Adjusted EBITDA:

($ in millions)    

Condensed
financial
information

 

Interest, tax,
depr., amort.

  MtM   Deactivation   Other adj.  

Adjusted
EBITDA

Operating revenues 3,421 12 (62 ) 3,371
Cost of operations     2,007     (11 )   (149 )           1,847  
Gross margin 1,414 23 87 1,524

Operations & maintenance
and other cost of operations

433 (2 ) 431

Selling, marketing, general &
administrative (a)

277 (6 ) 271
Other expense/(income) (b)     576     (587 )           (65 )   (73 )

Income/(Loss) from
Continuing Operations

    128     610     87     2     71     895  

(a) Other adj. includes reorganization costs of $6 million.
(b) Other adj. includes loss on debt extinguishment of $50 million, impairments of $9 million, gain on sale of assets of $4 million, and acquisition and
integration costs of $1 million.

 

                 

Appendix Table A-3: YTD Third Quarter 2017 Adjusted EBITDA Reconciliation by Operating Segment
The following table summarizes the calculation of Adj. EBITDA and provides a reconciliation to income/(loss) from
continuing operations:

($ in millions)    

Gulf
Coast

 

East/
West(a)

 

Generation

  Retail   Renewables  

NRG
Yield

 

Corp/
Elim

  Total

Income/(Loss) from Continuing
Operations

    59     141     200     380     (84 )   85     (461 )   120  
Plus:
Interest expense, net 22 22 3 74 235 350 684
Income tax 2 2 (9 ) (13 ) 15 10 5
Loss on debt extinguishment 3 3
Depreciation and amortization 207 80 287 87 150 241 24 789
ARO Expense 11 9 20 2 3 (1 ) 24
Contract Amortization 10 3 13 1 52 (1 ) 65
Lease amortization         (6 )   (6 )                   (6 )
EBITDA 287 251 538 461 133 631 (79 ) 1,684

Adjustment to reflect NRG share of
adjusted EBITDA in
unconsolidated affiliates

15 19 34 (10 ) (21 ) 79 11 93

Acquisition-related transaction &
integration costs

(10 ) (10 ) 2 3 (5 )
Reorganization costs 3 3 5 28 36
Deactivation costs 3 3 9 12
Other non recurring charges (14 ) (2 ) (16 ) 2 9 7 (6 ) (4 )
Impairments 42 42 35 77

Mark to market (MtM)
(gains)/losses on economic hedges

    (152 )   (11 )   (163 )   154     (8 )           (17 )
Adjusted EBITDA     171     260     431     612     148     719     (34 )   1,876  

(a) Includes International, BETM and generation eliminations.

 

                 

YTD Third Quarter 2017 condensed financial information by Operating Segment:

($ in millions)    

Gulf
Coast

 

East/
West(a)

  Generation   Retail   Renewables  

NRG
Yield

 

Corp/
Elim

  Total
Operating revenues 1,758 1,125 2,883 4,875 357 819 (946 ) 7,988
Cost of sales     1,049     496     1,545     3,669     11     45     (908 )   4,362  
Economic gross margin 709 629 1,338 1,206 346 774 (38 ) 3,626

Operations & maintenance and
other cost of operations (b)

440 329 769 246 107 193 (29 ) 1,286

Selling, marketing, general &
administrative (c)

32 120 152 332 43 16 118 661
Other expense/(income) (d)     66     (80 )   (14 )   16     48     (154 )   (93 )   (197 )
Adjusted EBITDA     171     260     431     612     148     719     (34 )   1,876  

(a) Includes International, BETM and generation eliminations.
(b) Excludes deactivation costs of $12 million.
(c) Excludes reorganization costs of $36 million.
(d) Excludes impairments of $77 million, acquisition-related transaction & integration costs of $5 million, and loss on debt extinguishment of $3 million.

 

             

The following table reconciles the condensed financial information to Adjusted EBITDA:

($ in millions)    

Condensed
financial
information

 

Interest, tax,
depr., amort.

  MtM   Deactivation  

Other adj.

 

Adjusted
EBITDA

Operating revenues 8,132 41 (185 ) 7,988
Cost of operations     4,554     (24 )   (168 )           4,362  
Gross margin 3,578 65 (17 ) 3,626

Operations & maintenance and
other cost of operations

1,298 (12 ) 1,286

Selling, marketing, general &
administrative(a)

697 (36 ) 661
Other expense/(income) (b)     1,463     (1,561 )           (197 )   (197 )

Income/(Loss) from Continuing
Operations

    120     1,626     (17 )   12     233     1,876  

(a) Other adj. includes reorganization costs of $36 million.
(b) Other adj. includes impairments of $77 million, acquisition-related transaction & integration costs of $5 million, and loss on debt
extinguishment of $3 million.

 

                 

Appendix Table A-4: YTD Third Quarter 2016 Adjusted EBITDA Reconciliation by Operating Segment
The following table summarizes the calculation of Adjusted EBITDA and provides a reconciliation to income/(loss)
from continuing operations:

($ in millions)    

Gulf
Coast

 

East/
West(a)

  Generation   Retail   Renewables  

NRG
Yield

 

Corp/
Elim

  Total

(Loss)/Income from Continuing
Operations

    (247 )   198     (49 )   734     (107 )   116     (786 )   (92 )
Plus:
Interest expense, net 1 23 24 (1 ) 84 212 391 710
Income tax (2 ) (2 ) 1 (14 ) 25 65 75
Loss on debt extinguishment 119 119
Depreciation and amortization 251 80 331 83 143 224 45 826
ARO Expense 8 2 10 1 2 0 13
Contract Amortization 11 4 15 5 1 57 (3 ) 75
Lease amortization         (6 )   (6 )                   (6 )
EBITDA 24 299 323 822 108 636 (169 ) 1,720

Adjustment to reflect NRG share
of adjusted EBITDA in
unconsolidated affiliates

5 18 23 (2 ) 68 3 92

Acquisition-related transaction &
integration costs

1 1 6 7
Reorganization costs 5 3 17 25
Deactivation costs 13 13 1 14
Loss on sale of assets 79 79
Other non recurring charges 19 (6 ) 13 8 3 2 26
Impairments 26 26 27 12 65
Impairment loss on investment 137 5 142 (1 ) 6 147

MtM (gains)/losses on economic
hedges

    208     1     209     (150 )               59  
Adjusted EBITDA     393     357     750     677     143     707     (43 )   2,234  

(a) Includes International, BETM and generation eliminations.

 

                 

YTD Third Quarter 2016 condensed financial information by Operating Segment:

($ in millions)    

Gulf
Coast

 

East/
West(a)

  Generation   Retail   Renewables  

NRG
Yield

 

Corp/
Elim

  Total
Operating revenues 2,002 1,439 3,441 4,918 337 840 (807 ) 8,729
Cost of sales     1,027     616     1,643     3,633     12     48     (810 )   4,526  
Economic gross margin 975 823 1,798 1,285 325 792 3 4,203

Operations & maintenance
and other cost of operations (b)

467 434 901 249 107 184 (3 ) 1,438

Selling, marketing, general &
administrative (c)

32 163 195 357 40 10 174 776
Other expense/(income) (d)     83     (131 )   (48 )   2     35     (109 )   (125 )   (245 )
Adjusted EBITDA     393     357     750     677     143     707     (43 )   2,234  

(a) Includes International, BETM and generation eliminations.
(b) Excludes deactivation costs of $14 million.
(c) Excludes reorganization costs of $25 million.
(d) Excludes loss on sale of assets of $79 million, loss on debt extinguishment of $119 million, impairments of $65 million, and acquisition-
related transaction & integration costs of $7 million.

 

             

The following table reconciles the condensed financial information to Adjusted EBITDA:

($ in millions)    

Condensed
financial
information

 

Interest, tax,
depr., amort.

  MtM   Deactivation   Other adj.  

Adjusted
EBITDA

Operating revenues 8,328 41 360 8,729
Cost of operations     4,259     (34 )   301             4,526  
Gross margin 4,069 75 59 4,203

Operations & maintenance and
other cost of operations

1,452 (14 ) 1,438

Selling, marketing, general &
administrative (a)

801 (25 ) 776
Other expense/(income) (b)     1,908     (1,938 )           (215 )   (245 )
(Loss)/Income from Continuing Operations     (92 )   2,013     59     14     240     2,234  

(a) Other adj. includes reorganization costs of $25 million.
(b) Other adj. includes loss on debt extinguishment of $119 million, loss on sale of assets of $79 million, impairments of $65 million, and acquisition-
related transaction & integration costs of $7 million.

 

   

Appendix Table A-5: 2017 and 2016 QTD and YTD Third Quarter Adjusted Cash Flow from Operations
Reconciliations
The following table summarizes the calculation of adjusted cash flow operating activities providing a reconciliation
to net cash provided by operating activities:

Three Months Ended
($ in millions)     September 30, 2017   September 30, 2016
Net Cash Provided by Operating Activities 732   794

Reclassifying of net receipts for settlement of acquired derivatives that
include financing elements

2
Sale of Land
Merger, integration, and cost-to-achieve expenses (1) 14 22
Cash contribution to GenOn pension plan (2) 13
Return of capital from equity investments 4 (5 )
Adjustment for change in collateral (3)     (86 )   62  
Adjusted Cash Flow from Operating Activities     677     875  
Maintenance CapEx, net (4) (41 ) (79 )
Environmental CapEx, net (36 )
Preferred dividends
Distributions to non-controlling interests     (37 )   (34 )
Free Cash Flow Before Growth Investments (FCFbG)     599     726  

(1) 2017 includes cost-to-achieve expenses associated with the Transformation Plan announced on July 2017 call; 2016 includes cost-to-achieve
expenses associated with the $150 million savings announced on September 2015 call.
(2) Reflects cash contribution related to Legacy GenOn pension liability retained by NRG
(3) Reflects change in NRG’s cash collateral balance as of 3Q2017 including $79 million of collateral postings from our deconsolidated affiliate
(GenOn)
(4) Includes insurance proceeds of $4 million and $2 million in 2017 and 2016, respectively

 

   
Nine Months Ended
($ in millions)     September 30, 2017   September 30, 2016
Net Cash Provided by Operating Activities 844   1,674

Reclassifying of net receipts for settlement of acquired derivatives that
include financing elements

2 6
Sale of Land 8
Merger, integration, and cost-to-achieve expenses (1) 14 47
Cash contribution to GenOn pension plan (2) 13
Return of capital from equity investments 22 6
Adjustment for change in collateral (3)     182     (261 )
Adjusted Cash Flow from Operating Activities     1,085     1,472  
Maintenance CapEx, net (4) (125 ) (171 )
Environmental CapEx, net (25 ) (198 )
Preferred dividends (2 )
Distributions to non-controlling interests     (128 )   (116 )
Free Cash Flow Before Growth Investments (FCFbG)     807     985  

(1) 2017 includes cost-to-achieve expenses associated with the Transformation Plan announced on July 2017 call; 2016 includes cost-to-achieve
expenses associated with the $150 million savings announced on September 2015 call.
(2) Reflects cash contribution related to Legacy GenOn pension liability retained by NRG
(3) Reflects change in NRG’s cash collateral balance as of 3Q2017 including $79 million of collateral postings from our deconsolidated affiliate
(GenOn)
(4) Includes insurance proceeds of $22 million and $33 million in 2017 and 2016, respectively

 

   

Appendix Table A-6: Third Quarter YTD 2017 Sources and Uses of Liquidity
The following table summarizes the sources and uses of liquidity through third quarter of 2017:

 

($ in millions)    

Nine Months Ended
September 30, 2017

Sources:
Adjusted cash flow from operations 1,085
Increase in credit facility 615
Issuance of Agua Caliente HoldCo debt 130
Growth investments and acquisitions, net 132
Asset sales 28
NYLD Equity Issuance     34
Uses:
Debt Repayments, net of proceeds (528)
Collateral (1) (182)
Maintenance and environmental capex, net (2) (150)
Distributions to non-controlling interests (128)
Common Stock Dividends (28)
Other Investing and Financing     (17)
Change in Total Liquidity     991

(1) Reflects change in NRG’s cash collateral balance as of 3Q2017 including $79MM of collateral postings from our deconsolidated affiliate
(GenOn)
(2) Includes insurance proceeds of $22 million.

 

 

Appendix Table A-7: 2017 and 2018 Adjusted EBITDA Guidance Reconciliation
The following table summarizes the calculation of Adjusted EBITDA providing reconciliation to net income:

 

2017 Adjusted EBITDA
Prior Guidance
($ in millions)     Low   High
GAAP Net Income 1 360   560
Income Tax 80 80
Interest Expense 825 825
Depreciation, Amortization, Contract Amortization and ARO Expense 1,150 1,150
Adjustment to reflect NRG share of adjusted EBITDA in
unconsolidated affiliates
110 110
Other Costs 2     40       40
Adjusted EBITDA     2,565       2,765
    2017 Adjusted EBITDA
Revised Guidance
($ in millions)     Low   High
GAAP Net Income 1 55     155
Income Tax 10 10
Interest Expense 835 835
Depreciation, Amortization, Contract Amortization and ARO Expense 1,170 1,170
Adjustment to reflect NRG share of adjusted EBITDA in
unconsolidated affiliates
130 130
Other Costs 2     200       200
Adjusted EBITDA     2,400       2,500
2018 Adjusted EBITDA
Guidance
($ in millions)     Low   High
GAAP Net Income 1 410 610
Income Tax 20 20
Interest Expense 785 785
Depreciation, Amortization, Contract Amortization and ARO Expense 1,180 1,180
Adjustment to reflect NRG share of adjusted EBITDA in
unconsolidated affiliates
135 135
Other Costs 2     270       270
Adjusted EBITDA     2,800       3,000

(1) For purposes of guidance, discontinued operations are excluded and fair value adjustments related to derivatives are assumed to be
zero.

(2) Includes deactivation costs, gain on sale of businesses, asset write-offs, impairments and other non-recurring charges.

 

       

 

Appendix Table A-8: 2017 and 2018 FCFbG Guidance Reconciliation
The following table summarizes the calculation of Free Cash Flow before Growth providing reconciliation to Cash
from Operations:

 

    2017   2017   2018
($ in millions)    

Prior
Guidance

 

Revised
Guidance

  Guidance
Adjusted EBITDA $2,565 - $2,765 $2,400 - $2,500 $2,800 - $3,000
Cash Interest payments (825 ) (835 ) (785 )
Cash Income tax (40 ) (25 ) (40 )
Collateral / working capital / other     60     60     40  
Cash From Operations $1,760 - $1,960 $1,600 - $1,700 $2,015 - $2,215

Adjustments: Acquired Derivatives, Cost-to-Achieve, Return of
Capital Dividends, Collateral and Other

   

 

 

 

 

 

Adjusted Cash flow from operations $1,760 - $1,960 $1,600 - $1,700 $2,015 - $2,215
Maintenance capital expenditures, net (210) - (240) (200) - (220) (210) - (240)
Environmental capital expenditures, net (25) - (45) (25) - (35) (0) - (5)
Distributions to non-controlling interests     (185) - (205)   (180) - (190)   (220) - (250)
Free Cash Flow - before Growth Investments     $1,290 - $1,490   $1,175 - $1,275   $1,550 - $1,750
 

EBITDA and Adjusted EBITDA are non-GAAP financial measures. These measurements are not recognized in accordance with GAAP and should not be viewed as an alternative to GAAP measures of performance. The presentation of Adjusted EBITDA should not be construed as an inference that NRG’s future results will be unaffected by unusual or non-recurring items.

EBITDA represents net income before interest (including loss on debt extinguishment), taxes, depreciation and amortization. EBITDA is presented because NRG considers it an important supplemental measure of its performance and believes debt-holders frequently use EBITDA to analyze operating performance and debt service capacity. EBITDA has limitations as an analytical tool, and you should not consider it in isolation, or as a substitute for analysis of our operating results as reported under GAAP. Some of these limitations are:

  • EBITDA does not reflect cash expenditures, or future requirements for capital expenditures, or contractual commitments;
  • EBITDA does not reflect changes in, or cash requirements for, working capital needs;
  • EBITDA does not reflect the significant interest expense, or the cash requirements necessary to service interest or principal payments, on debt or cash income tax payments;
  • Although depreciation and amortization are non-cash charges, the assets being depreciated and amortized will often have to be replaced in the future, and EBITDA does not reflect any cash requirements for such replacements; and
  • Other companies in this industry may calculate EBITDA differently than NRG does, limiting its usefulness as a comparative measure.

Because of these limitations, EBITDA should not be considered as a measure of discretionary cash available to use to invest in the growth of NRG’s business. NRG compensates for these limitations by relying primarily on our GAAP results and using EBITDA and Adjusted EBITDA only supplementally. See the statements of cash flow included in the financial statements that are a part of this news release.

Adjusted EBITDA is presented as a further supplemental measure of operating performance. As NRG defines it, Adjusted EBITDA represents EBITDA excluding impairment losses, gains or losses on sales, dispositions or retirements of assets, any mark-to-market gains or losses from accounting for derivatives, adjustments to exclude the Adjusted EBITDA related to the non-controlling interest, gains or losses on the repurchase, modification or extinguishment of debt, the impact of restructuring and any extraordinary, unusual or non-recurring items plus adjustments to reflect the Adjusted EBITDA from our unconsolidated investments. The reader is encouraged to evaluate each adjustment and the reasons NRG considers it appropriate for supplemental analysis. As an analytical tool, Adjusted EBITDA is subject to all of the limitations applicable to EBITDA. In addition, in evaluating Adjusted EBITDA, the reader should be aware that in the future NRG may incur expenses similar to the adjustments in this news release.

Management believes Adjusted EBITDA is useful to investors and other users of NRG's financial statements in evaluating its operating performance because it provides an additional tool to compare business performance across companies and across periods and adjusts for items that we do not consider indicative of NRG’s future operating performance. This measure is widely used by debt-holders to analyze operating performance and debt service capacity and by equity investors to measure our operating performance without regard to items such as interest expense, taxes, depreciation and amortization, which can vary substantially from company to company depending upon accounting methods and book value of assets, capital structure and the method by which assets were acquired. Management uses Adjusted EBITDA as a measure of operating performance to assist in comparing performance from period to period on a consistent basis and to readily view operating trends, as a measure for planning and forecasting overall expectations, and for evaluating actual results against such expectations, and in communications with NRG's Board of Directors, shareholders, creditors, analysts and investors concerning its financial performance.

Adjusted cash flow from operating activities is a non-GAAP measure NRG provides to show cash from operations with the reclassification of net payments of derivative contracts acquired in business combinations from financing to operating cash flow, as well as the add back of merger, integration and related restructuring costs. The Company provides the reader with this alternative view of operating cash flow because the cash settlement of these derivative contracts materially impact operating revenues and cost of sales, while GAAP requires NRG to treat them as if there was a financing activity associated with the contracts as of the acquisition dates. The Company adds back merger, integration related restructuring costs as they are one time and unique in nature and do not reflect ongoing cash from operations and they are fully disclosed to investors.

Free cash flow (before Growth Investments) is adjusted cash flow from operations less maintenance and environmental capital expenditures, net of funding, preferred stock dividends and distributions to non-controlling interests and is used by NRG predominantly as a forecasting tool to estimate cash available for debt reduction and other capital allocation alternatives. The reader is encouraged to evaluate each of these adjustments and the reasons NRG considers them appropriate for supplemental analysis. Because we have mandatory debt service requirements (and other non-discretionary expenditures) investors should not rely on Free Cash Flow before Growth Investments as a measure of cash available for discretionary expenditures.

Free Cash Flow before Growth Investments is utilized by Management in making decisions regarding the allocation of capital. Free Cash Flow before Growth Investment is presented because the Company believes it is a useful tool for assessing the financial performance in the current period. In addition, NRG’s peers evaluate cash available for allocation in a similar manner and accordingly, it is a meaningful indicator for investors to benchmark NRG's performance against its peers. Free Cash Flow before Growth Investment is a performance measure and is not intended to represent net income (loss), cash from operations (the most directly comparable U.S. GAAP measure), or liquidity and is not necessarily comparable to similarly titled measures reported by other companies.

Source: NRG Energy, Inc.

NRG Energy, Inc.
Media:
Sheri Woodruff, 609-524-4608
Marijke Shugrue, 609-524-5262
or
Investors:
Kevin L. Cole, CFA, 609-524-4526
Lindsey Puchyr, 609-524-4527