Calpine Corporation (NYSE:CPN) today reported full-year financial
and operating results for the year ended Dec. 31, 2007. Calpine�s
Annual Report on Form 10-K, including its audited financial
statements, for the year ended Dec. 31, 2007, was filed with an
effective date of today with the Securities and Exchange Commission
(SEC) and can be found on the SEC�s website at http://www.sec.gov.
Full-year highlights include: � Year Ended Dec. 31 � � 2007 � � �
2006 � � % Chg Operating Revenues (millions) (a) $ 7,970 $ 6,937 15
% GAAP Net Income/(loss) (millions) (a) $ 2,693 $ (1,765 ) NA
Commodity Margin (millions) (b,c) $ 2,225 $ 2,021 10 % Adjusted
EBITDA (millions) (c,d) $ 1,412 $ 1,029 37 % Megawatt-Hours
Generated (thousands) 90,811 83,146 9 % Average Total Megawatts in
Operation (thousands) 24,755 26,785 (8 )% Average Capacity Factor
(excluding peakers) 46.6 % 39.2 % 19 % � (a) See the accompanying
Consolidated Statements of Operations for the periods ending on
December 31 for 2005, 2006 and 2007 � (b) Commodity margin includes
Calpine�s electricity and steam revenues, hedging and optimization
activities, renewable energy credit revenue, transmission revenue
and expenses, and fuel and purchased energy expenses, but excludes
mark-to-market activity and other service revenues. � (c) Commodity
Margin and Adjusted EBITDA are non-GAAP measures important to
management�s assessment of the Company�s performance. Commodity
margin and Adjusted EBITDA do not purport to represent net income
(loss), the most comparable GAAP measure, as an indicator of
operating performance and are not necessarily comparable to
similarly-titled measures reported by other companies. See the
accompanying tables for a reconciliation of commodity margin and
Adjusted EBITDA to net income (loss) from operations. � (d)
Earnings Before Interest, Tax, Depreciation and Amortization, as
adjusted. Robert P. May, Calpine�s Chief Executive Officer, stated,
�We entered 2008 as the new Calpine with a renewed commitment to:
generating and selling clean, reliable and cost-effective
electricity. We continue to deliver on this commitment every day,
which is why Calpine is one of the industry�s largest North
American natural gas-fired power providers and is the nation�s
largest renewable geothermal energy producer, well-positioned to
lead a new era of clean power generation.� Outlook Going forward,
Calpine expects to maintain its strong liquidity position and
maximize the performance of core strategic assets in the markets in
which Calpine operates. The Company has taken steps to stabilize,
improve and strengthen its power generation business and financial
health by reducing activities and curtailing expenditures in
certain non-core areas. Analyst Meeting and Webcast As previously
announced, Calpine will host an analyst meeting today. A live
Internet Webcast of the meeting, including management's
presentation will be active at approximately 12:45 p.m. EST and can
be found at http://www.calpine.com by clicking on an available
audio link. The Webcast will be available for replay purposes on
the Company�s website approximately two hours after the event and
then for 45 days following the live broadcast. About Calpine
Calpine Corporation is helping meet the needs of an economy that
demands more and cleaner sources of electricity. Founded in 1984,
Calpine is a major U.S. power company, currently capable of
delivering approximately 24,000 megawatts of clean, cost-effective,
reliable, and fuel-efficient electricity to customers and
communities in 18 states in the United States. Calpine owns,
leases, and operates low-carbon, natural gas-fired, and renewable
geothermal power plants. Using advanced technologies, Calpine
generates electricity in a reliable and environmentally responsible
manner for the customers and communities it serves. Please visit
http://www.calpine.com for more information. Forward Looking
Statement In addition to historical information, this release
contains forward-looking statements within the meaning of
Section�27A of the Securities Act and Section 21E of the Exchange
Act. Words such as �believe,� �intend,� �expect,� �anticipate,�
�plan,� �may,� �will� and similar expressions identify
forward-looking statements. Such statements include, among others,
those concerning expected financial performance and strategic and
operational plans, as well as all assumptions, expectations,
predictions, intentions or beliefs about future events. You are
cautioned that any such forward-looking statements are not
guarantees of future performance and that a number of risks and
uncertainties could cause actual results to differ materially from
those anticipated in the forward-looking statements. Such risks and
uncertainties include, but are not limited to: (i) Calpine�s
ability to implement its business plan; (ii) financial results that
may be volatile and may not reflect historical trends; (iii)
seasonal fluctuations of results and exposure to variations in
weather patterns; (iv) potential volatility in earnings associated
with fluctuations in prices for commodities such as natural gas and
power; (v) ability to manage liquidity needs and comply with
covenants related to the Exit Credit and Bridge Facilities and
other existing financing obligations; (vi) Calpine�s ability to
complete the implementation of its Plan of Reorganization and the
discharge of its chapter�11 cases including successfully resolving
any remaining claims; (vii) disruptions in or limitations on the
transportation of natural gas and transmission of electricity;
(viii) the expiration or termination of power purchase agreements
and the related results on revenues; (ix) risks associated with the
operation of power plants including unscheduled outages; (x)
factors that impact the output of Calpine�s geothermal resources
and generation facilities, including unusual or unexpected steam
field well and pipeline maintenance and variables associated with
the waste water injection projects that supply added water to the
steam reservoir; (xi) risks associated with power project
development and construction activities; (xii) ability to attract,
retain and motivate key employees including filling certain
significant positions within Calpine�s management team; (xiii)
ability to attract and retain customers and counterparties; (xiv)
competition; (xv) risks associated with marketing and selling power
from plants in the evolving energy markets; (xvi) present and
possible future claims, litigation and enforcement actions; (xvii)
effects of the application of laws or regulations, including
changes in laws or regulations or the interpretation thereof; and
(xviii) other risks identified from time-to-time in Calpine�s
reports and registration statements filed with the SEC, including,
without limitation, the risk factors identified in its Annual
Report on Form 10-K for the year ended December 31, 2007. Actual
results or developments may differ materially from the expectations
expressed or implied in the forward-looking statements and Calpine
undertakes no obligation to update any such statements. Unless
specified otherwise, all information set forth in this release is
as of today's date and Calpine undertakes no duty to update this
information. For additional information about Calpine's chapter 11
reorganization or general business operations, please refer to
Calpine's Annual Report on Form 10-K for the fiscal year ended
December 31, 2007, and any other recent Calpine report to the
Securities and Exchange Commission. These filings are available by
visiting the Securities and Exchange Commission's website at
http://www.sec.gov or Calpine's website at http://www.calpine.com.
CALPINE CORPORATION AND SUBSIDIARIES (DEBTOR-IN-POSSESSION) �
CONSOLIDATED STATEMENTS OF OPERATIONS � Years Ended December 31,
2007 2006 2005 (in millions, except per share amounts) Operating
revenues $ 7,970 $ 6,937 $ 10,302 � Cost of revenue: Fuel and
purchased energy expenses 5,683 4,752 8,318 Plant operating expense
749 750 717 Depreciation and amortization 463 470 506 Operating
plant impairments 44 53 2,413 Other cost of revenue � 136 � 172 �
293 Gross profit (loss) 895 740 (1,945 ) Equipment, development
project and other impairments 2 65 2,117 Sales, general and other
administrative expense 146 175 240 Other operating expenses � 42 �
36 � 69 Income (loss) from operations 705 464 (4,371 ) Interest
expense 2,019 1,254 1,397 Interest (income) (64 ) (79 ) (84 ) Loss
(income) from various repurchases of debt � 18 (203 ) Minority
interest expense � 5 43 Other (income) expense, net � (139 ) � (5 )
� 72 Loss before reorganization items, income taxes and
discontinued operations (1,111 ) (729 ) (5,596 ) Reorganization
items � (3,258 ) � 972 � 5,026 Income (loss) before income taxes
and discontinued operations 2,147 (1,701 ) (10,622 ) Provision
(benefit) for income taxes � (546 ) � 64 � (741 ) Income (loss)
before discontinued operations 2,693 (1,765 ) (9,881 ) Discontinued
operations, net of tax provision of $132 in 2005 � � � � � (58 )
Net income (loss) $ 2,693 $ (1,765 ) $ (9,939 ) � � Basic earnings
(loss) per common share: Weighted average shares of common stock
outstanding (in thousands) 479,235 479,136 463,567 Income (loss)
before discontinued operations $ 5.62 $ (3.68 ) $ (21.32 )
Discontinued operations, net of tax � � � � � (0.12 ) Net income
(loss) $ 5.62 $ (3.68 ) $ (21.44 ) � � Diluted earnings (loss) per
common share: Weighted average shares of common stock outstanding
(in thousands) 479,478 479,136 463,567 Income (loss) before
discontinued operations $ 5.62 $ (3.68 ) $ (21.32 ) Discontinued
operations, net of tax � � � � � (0.12 ) Net income (loss) $ 5.62 $
(3.68 ) $ (21.44 ) Consolidated Commodity Margin The following
table reconciles our commodity margin to our GAAP results for the
years ended December�31, 2007 and 2006 (in millions). � 2007 2006
Operating revenues $ 7,970 $ 6,937 (Less): Other service revenues
(57 ) (73 ) (Less): Fuel and purchased energy expenses (5,683 )
(4,752 ) Adjustment to remove: Mark-to-market activity, net(1) � (5
) � (91 ) Consolidated commodity margin $ 2,225 $ 2,021 � (1)
Included in operating revenues and fuel and purchased energy
expenses. Adjusted EBITDA The below table provides a reconciliation
of Adjusted EBITDA to our cash flow from operations and GAAP net
income (loss): � Years Ended December 31, 2007 2006 2005 (in
millions) Cash provided by (used in) operating activities $ 182 $
156 $ (708 ) Less: Changes in operating assets and liabilities,
excluding the effects of acquisition 686 259 (332 ) Additional
adjustments to reconcile GAAP net loss to net cash provided by
(used in) operating activities from both continuing and
discontinued operations: Depreciation and amortization expense (1)
554 585 760 Deferred income taxes (517 ) 22 (610 ) Mark-to-market
activity, net 13 (99 ) (11 ) Non-cash reorganization items (3,342 )
807 5,013 Impairment charges and other � 95 � 347 � 4,411 GAAP net
income (loss) 2,693 (1,765 ) (9,939 ) Less: Loss from discontinued
operations � � � � � (58 ) Net income (loss) from continuing
operations 2,693 (1,765 ) (9,881 ) Add: Adjustments to reconcile
Adjusted EBITDA to net income (loss) from continuing operations:
Interest expense, net of interest income 1,955 1,175 1,313
Depreciation and amortization expense, excluding deferred financing
costs(1) 507 522 558 Income tax provision (benefit) (546 ) 64 (741
) Impairment charges 46 118 4,530 Reorganization items (3,258 ) 972
5,026 Major maintenance expense 98 77 70 Operating lease expense 54
66 105 Loss (income) on various repurchases of debt � 18 (203 )
(Gains) losses on derivatives 2 (213 ) 52 (Gains) losses on sales
of assets and contract restructuring, excluding reorganization
items (7 ) (6 ) 18 Claim settlement income (135 ) � � Other � 3 � 1
� 80 Adjusted EBITDA $ 1,412 $ 1,029 $ 927 � � (1) Depreciation and
amortization in the GAAP net income (loss) calculation on our
Consolidated Statements of Operations excludes amortization of
other assets and amounts classified as SG&A.
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