Entergy 2004 Annual Report Download - page 8

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Entergy Corporation and Subsidiaries 2004
satisfied until we have an accident-free
work environment. And we continued
to work with regulators, agencies, and
advocates to better meet the needs of
low-income residents in our service
territory. Meeting our environmental,
safety, and social performance goals is
as important to us as meeting our
financial expectations.
In total, our progress in 2004 can just
as easily be measured in what we didn’t
do as in what we did. We remained
disciplined with our capital and kept a
careful eye on the amount of risk we
want to hold as a company. We did not
enter into any transactions that did not
meet our risk and return hurdles.
Instead, we chose to return cash to our
shareholders through both a stock
repurchase program and a higher
dividend. And our credit standing
improved significantly as both Moody’s
and Standard & Poor’s raised our credit
ratings. After thorough analysis
(confirmed with the benefit of 20/20
hindsight), we believe this was the best
use of available cash in 2004.
Growing the Business
With the sale of EKTand an absence of
nuclear transactions in 2004, the question
naturally arises – how will we grow
shareholder value?
•In our utilities, growth will come
from increased demand, improved
rate structures, and our Generation
Supply Plan. We believe demand
growth in our service territory will
continue at a modest one to two
percent annual rate. However, coupled
with new rate structures that include
performance-based incentives, we
believe the utility business can
provide solid growth going forward.
•Growth in nuclear will come from
greater availability of attractive
nuclear transactions as owners of
underperforming nuclear assets move
to lower their costs or improve
operations. We believe the market for
potential transactions presents
opportunities. Also, we will complete
uprate projects at Waterford 3 and
Indian Point 3 and we expect to
obtain approval to place in service the
50 MW uprate that was completed at
Vermont Yankee last year. In addition,
we believe we have a longer-term
opportunity to transform our Northeast
asset portfolio into a moreintegrated
business by adding other types of
generation that are more dispatchable
or a short position that matches up
with our low-cost, reliable, base-load
nuclear output.
While we cannot give a preview of
the precise mix of opportunities that
will result in the future, we can assure
you that we will apply the same
discipline and capital stewardship we
have applied in the past to ensure our
risk and return criteria are met. And if
our opportunityset becomes limited, we
will return cash to owners through share
repurchases or through dividend
increases, just as we aredoing today.
Bottomline, we believe our long-
term growth aspiration of five to six
percent is very achievable. And that
belief holds not just for today, but also
for tomorrow with whatever tomorrow
brings. With our dynamic business
model, we are confident we can succeed
in a wide range of market conditions.
Our point-of-viewapproachis
inherently flexible, enabling us to adjust
J. Wayne Leonard
Chief Executive Officer
“It’s the extraordinary efforts of
everyone at Entergy – from our
Board members to our linemen –
that drive our long-term results.”