Entergy 2010 Annual Report Download - page 6

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n
We were the fi rst U.S. utility to commit to voluntarily
reduce greenhouse gases. Not only are we following
through, we are exceeding our commitment. We have
been long-standing external advocates for sustainable
carbon policies at the federal, state and local levels.
n
We established the Entergy Charitable Foundation and
our low-income initiative to address the widespread
poverty in our communities. Over the past 12 years,
we raised more than $19 million in customer assistance
funds, provided $2 million in seed money to help low-
income families build assets in a program that now serves
69 communities, provided more than $20 million to help
rebuild New Orleans after Katrina and much more.
Our 12-year track record of performance is due largely
to the efforts of our employees,
leadership team and board of
directors. The hard work and
commitment to Entergy’s success
that these individuals demonstrate
every day is without question
our greatest strength and most
powerful advantage.
Understanding and
Eliminating the “Downs”
in an Up-and-Down Year
As I previously mentioned, we
achieved record operational
earnings per share in 2010, but
were unable to translate this result
into a positive total shareholder
return. Our as-reported earnings
for 2010 were $6.66 per share, 5.7
percent higher than 2009. Not only
did we achieve another record
year of operational earnings
per share for our company (the
tenth new record since 1999), we
realized record operating cash fl ow for the year. We at the
same time returned $1.5 billion to shareholders through
dividends and share repurchases. We increased our
annual dividend in April by 11 percent and completed our
$750 million share repurchase program. And in October
the board authorized another share repurchase program
of $500 million.
But again, our total shareholder return was
(9.7) percent, ranking in the bottom quartile of our peer
group. Uncertainties continue to weigh on Entergy’s
stock including, among others, license renewal efforts at
Indian Point Energy Center Units 2 and 3, Pilgrim Nuclear
Power Station and Vermont Yankee Nuclear Power Station.
Also depressed power prices affected the non-utility
generation business, with another $9.25 to $12.50 per MWh
decline in forward Northeast power prices for the 2011
through 2014 period.
Regardless of the challenges facing us today, our
overarching fi nancial aspiration to consistently achieve
top-quartile total shareholder return remains the same.
We have done this for many years and we can do it again.
Our Utility business is among the fastest growing in the
U.S., and the non-utility generation business is among the
best positioned in the near term, providing certainty in a
bearish environment.
Going forward, we’re focused on creating and
preserving cash to fund opportunistic investments
consistent with our points of view. In these efforts, we
need to be attentive to our proven
ability to create value through
effective portfolio management.
Absent attractive investment
opportunities, our long-term
fi nancial outlook updated last
October supports the return of
capital of as much as $4 billion to
$5 billion from 2010 through 2014.
We need to put more certainty
around that number, grow it and
deploy it well (either return it
directly to you or invest it wisely
and profi tably).
The Utility: Developing
Productive Opportunities
Our Utility business is fi rst and
foremost an essential service
provider to the people and
businesses in Arkansas, Louisiana,
Mississippi and Texas. We never
lose sight of this fact. In 2010,
the Utility continued to focus on
reliability and affordability, and it improved customer
service performance as measured by outage duration,
outage frequency and regulatory outage complaints.
In addition, the Utility worked with state and local
regulators in each jurisdiction to achieve constructive
outcomes. In order for the utility operating companies
to attract capital for productive investments to meet
service obligations at a price consistent with others with
the same risk profi le, there are two key requirements:
fi rst, a reasonable opportunity to earn a fair return (that’s
where constructive regulation comes in) and second,
managers who operate effectively and effi ciently every
day in serving customers’ needs. In that regard, two
A Record of Success
We are proud of the recognition we
received in 2010. Among the honors are:
n
Dow Jones Sustainability World Index
and North America Index
n  
Edison Electric Institute Emergency
Assistance Award
n  
Nuclear Energy Institute Best of the
Best Top Industry Practice Award
n  
GovernanceMetrics International
global rating of 10.0, the highest
possible rating, in recognition of
best-in-class corporate governance
n  
National Fuel Funds Network 2010
Corporate Excellence Award for
fi ghting poverty and helping
low-income customers
n   
Minority Engineer
magazine Top 50
er
Employers for 2010
4