Entergy 2002 Annual Report Download - page 22

s we look ahead, Entergy is sticking with
the refocused strategy we adopted in
1998. That strategy provides not only a clear
guide amid changes in the market, but also
flexibility to respond to those changes. By
executing on our strategy, we’ll continue to
meet our targets and our obligations, even
when times are bad. And we’ll be ready to
seize opportunities.
We’re continually building our long-term
capacity to generate income. We do this through
both “intrinsic” growth in businesses we already
operate and growth from new investments.
Over the past four years, Entergy’s new
investments – most notably nuclear generation
and the Entergy-Koch joint venture – generated
over $350 million in net income. Today, these
businesses provide a stable base of earnings
and a platform for growth.
Most of our future earnings growth will
come from businesses we already operate. We
can expand our ability to generate earnings in
our current businesses through such things as
additions to our utility rate base, uprates at our
nuclear power plants, and expansion of gas
storage facilities at Entergy-Koch.
Such intrinsic growth can get us 60 percent
of the way toward our goal of 8 to 10 percent
average annual earnings growth over the
2003 – 2005 period.
At the same time, our current businesses
are generating significant cash to invest in
other growth opportunities outside these
businesses. Good investments are becoming
available as our industry works out overbuilt
generation and other energy companies
sell off assets.
The following are goals for 2003 for each of
Entergy’s businesses:
In the utility:
Make significant progress towards achieving
top quartile cost performance by identifying
and implementing process efficiencies using
tools such as peer assessments and Six Sigma.
Gain approval for a rate increase at Entergy
New Orleans that allows the company to earn
a fair return on its investment.
Move our generation supply plan in
Louisiana forward and introduce
performance incentives into the rate of
return formulas by year-end.
In the nuclear business:
Continue to improve productivity at
Northeast plants, reducing average fleet
operating costs.
Sell or hedge at least 75 percent of 2005
output and 50 percent of 2006 output from
our Northeast plants by year-end 2003.
Increase output at Pilgrim and Indian Point 2
through power uprates scheduled for 2003,
on time and on budget.
At Entergy-Koch:
Obtain new customers, primarily by
advancing the physical optimization business
with a goal of doubling over the next two years.
Achieve global growth in the weather business
by developing distribution channels.
Continue to improve productivity at Gulf
South Pipeline.
Complete the Magnolia Gas Storage facility
on time and on budget.
While working to achieve these specific
objectives for 2003, we’ll continue to pursue
opportunities that can build our long-term
capacity to generate value.
AA
ENTERGY CORPORATION AND SUBSIDIARIES 2002
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LOOKING TO THE FUTURE: WHERE WE STAND