ARLINGTON, Va., Aug. 4, 2021 /PRNewswire/ --
Strategic Accomplishments
- Received regulatory approvals at US utilities, AES Indiana and
AES Ohio, further enabling planned new investments of more than
$2 billion to grow the rate base 9%
annually through 2025
- Signed 1.8 GW of new PPAs for renewable energy projects,
bringing total to 2.9 GW signed in year-to-date 2021 and increasing
the backlog to 8.5 GW
- Accelerated decarbonization efforts at AES Andes with the
voluntary retirement of an additional 1.1 GW of coal in
Chile, to be replaced by 2.3 GW of
contracted renewables
- Moody's changed the outlook on the Company's Ba1 credit rating
to positive
Q2 2021 Financial Highlights
- Diluted EPS of $0.03, compared to
$(0.13) in Q2 2020
- Adjusted EPS1 of $0.31, compared to $0.25 in Q2 2020
Financial Position and Outlook
- Reaffirming 2021 Adjusted EPS1 guidance range of
$1.50 to $1.58
- Reaffirming 7% to 9% average annual growth target through
2025
The AES Corporation (NYSE: AES) today reported financial
results for the quarter ended June 30,
2021.
"I am very pleased with our results for the first half of 2021,"
said Andrés Gluski, AES President and Chief Executive
Officer. "We are on track to hit all of our financial and
growth metrics for the year. Since our last earnings call in
May, we signed 1.8 GW of renewables PPAs, more than 90% of which
are in the US, for a total of 2.9 GW year-to-date, nearly double
the amount we did in the same period last year. This puts our
total backlog of signed projects at 8.5 GW, an all-time high.
We see demand for renewables as very strong, especially for our
structured around-the-clock carbon-free products. At the same
time, we continue to make good progress on our decarbonization
targets by also accelerating the retirement of coal plants and
growing our energy efficiency and cloud-based businesses."
"Our financial performance for the first half of the year,
combined with a positive outlook for the remainder of the year and
beyond, lead us to reaffirm our full year 2021 guidance and our 7%
to 9% average annual growth target in earnings and free cash flow
through 2025," said Gustavo Pimenta,
AES Executive Vice President and Chief Financial Officer. "We
are also excited to see Moody's changing AES' outlook on our Ba1
rating to positive, further validating the continuous improvement
in our credit profile."
Key Q2 2021 Financial Results
Second quarter 2021 Diluted Earnings Per Share from Continuing
Operations (Diluted EPS) was $0.03,
an increase of $0.16 compared to
second quarter 2020, primarily reflecting higher operating
performance at the Company's US & Utilities Strategic Business
Unit (SBU), gains from dispositions and acquisitions, and gains
from early contract terminations in Chile. These positive
drivers were partially offset by higher impairments, primarily at
AES Andes in Chile, associated
with the commitment to retire certain coal-fired plants.
Second quarter 2021 Adjusted Earnings Per Share1
(Adjusted EPS, a non-GAAP financial measure) was $0.31, an increase of $0.06 compared to second quarter 2020, primarily
reflecting contributions from new businesses, including renewables
and the Southland repowering, higher demand at utilities, and
Parent interest savings. These positive drivers were
partially offset by lower contributions from Chile and a higher adjusted tax
rate.
Detailed Strategic Overview
AES is leading the industry's transition to clean energy by
investing in sustainable growth and innovative solutions. The
Company is taking advantage of favorable trends in clean power
generation, transmission and distribution, and LNG infrastructure
to deliver superior results.
Through its presence in key growth markets, AES is well
positioned to benefit from the global transition toward a more
sustainable power generation mix.
- During the second quarter of 2021, the Company's US utilities,
AES Indiana and AES Ohio, received regulatory approval further
enabling the planned new investments of more than $2 billion, including:
-
- Transmission, Distribution, Storage Improvement Charge (TDSIC)
plan update and the 195 MW Hardy Hills solar project at AES
Indiana; and
- Smart Grid and FERC-regulated transmission rate at AES
Ohio.
- In year-to-date 2021, the Company completed construction or the
acquisition of 315 MW of renewables and energy storage,
including:
-
- 159 MW Mandacaru and Salinas wind facility in Brazil;
- 75 MW of solar and solar plus energy storage in the US at AES
Clean Energy;
- 50 MW Bayasol solar facility in the Dominican Republic;
- 21 MW of solar capacity in Panama; and
- 10 MW Cuscatlan solar facility in El
Salvador.
- Since the Company's first quarter 2021 earnings call in May,
the Company has signed 1,824 MW of renewables and energy storage
under long-term Power Purchase Agreements (PPA), including:
-
- 757 MW of solar and energy storage at AES Clean Energy in the
US;
- Agreeing to acquire 612 MW of operating wind assets with
near-term repowering plans to help New
York State meet its aggressive renewables targets;
- 295 MW of solar and energy storage at AES Indiana; and
- 160 MW of wind in Brazil.
- In year-to-date 2021, the Company signed or agreed to acquire
2,912 MW of renewables and energy storage under long-term PPAs,
bringing the Company's backlog to 8,471 MW, including:
-
- 2,549 MW under construction and expected to come on-line
through 2023; and
- 5,922 MW signed under long-term PPAs, including a 10-year
agreement to supply Google's data centers in Virginia with 500 MW of 24/7 carbon-free
energy.
- The Company is making substantial progress toward achieving its
aggressive coal reduction targets, including reducing coal
generation to below 10% by year-end 2025.
-
- In July 2021, AES Andes announced
the retirement of 1.1 GW of coal-fired generation, bringing the
Company's generation from coal to approximately 20% of total
generation volume (proforma for announced asset sales and
retirements).
Update on Fluence
AES with its partners, Siemens and Qatar Investment Authority
(QIA), is considering strategic options for Fluence to raise
additional capital to finance its continued growth, which may
include a public offering of its common shares.
Guidance and Expectations1
The Company is reaffirming its 2021 Adjusted EPS1
guidance of $1.50 to $1.58 and its 7% to 9% average annual growth rate
target through 2025, from a base year of 2020.
|
1
|
Adjusted EPS is a
non-GAAP financial measure. See attached "Non-GAAP Measures"
for definition of Adjusted EPS and a description of the adjustments
to reconcile Adjusted EPS to Diluted EPS for the quarter ended June
30, 2021. The Company is not able to provide a corresponding
GAAP equivalent or reconciliation for its Adjusted EPS guidance
without unreasonable effort.
|
Non-GAAP Financial Measures
See Non-GAAP Measures for definitions of Adjusted Earnings Per
Share and Adjusted Pre-Tax Contribution, as well as reconciliations
to the most comparable GAAP financial measures.
Attachments
Condensed Consolidated Statements of Operations, Segment
Information, Condensed Consolidated Balance Sheets, Condensed
Consolidated Statements of Cash Flows, Non-GAAP Financial Measures
and Parent Financial Information.
Conference Call Information
AES will host a conference call on Thursday, August 5, 2021 at 9:00 a.m. Eastern Daylight Time (EDT).
Interested parties may listen to the teleconference by dialing
1-888-317-6003 at least ten minutes before the start of the call.
International callers should dial +1-412-317-6061. The
Conference ID for this call is 0382752. Internet access to
the conference call and presentation materials will be available on
the AES website at www.aes.com by selecting "Investors"
and then "Upcoming events."
A webcast replay, as well as a replay in downloadable MP3
format, will be accessible at www.aes.com beginning shortly
after the completion of the call.
About AES
The AES Corporation (NYSE: AES) is a Fortune 500 global power
company accelerating the future of energy. Together with our
many stakeholders, we're improving lives by delivering the greener,
smarter energy solutions the world needs. Our diverse
workforce is committed to continuous innovation and operational
excellence, while partnering with our customers on their strategic
energy transitions and continuing to meet their energy needs
today. For more information, visit www.aes.com.
Safe Harbor Disclosure
This news release contains forward-looking statements within the
meaning of the Securities Act of 1933 and of the Securities
Exchange Act of 1934. Such forward-looking statements include, but
are not limited to, those related to future earnings, growth and
financial and operating performance. Forward-looking statements are
not intended to be a guarantee of future results, but instead
constitute AES' current expectations based on reasonable
assumptions. Forecasted financial information is based on certain
material assumptions. These assumptions include, but are not
limited to, our expectations regarding the COVID-19 pandemic,
accurate projections of future interest rates, commodity price and
foreign currency pricing, continued normal levels of operating
performance and electricity volume at our distribution companies
and operational performance at our generation businesses consistent
with historical levels, as well as the execution of PPAs,
conversion of our backlog and growth investments at normalized
investment levels and rates of return consistent with prior
experience.
Actual results could differ materially from those projected in
our forward-looking statements due to risks, uncertainties and
other factors. Important factors that could affect actual results
are discussed in AES' filings with the Securities and Exchange
Commission (the "SEC"), including, but not limited to, the risks
discussed under Item 1A: "Risk Factors" and Item 7: "Management's
Discussion & Analysis" in AES' 2020 Annual Report on Form
10-K and in subsequent reports filed with the SEC. Readers are
encouraged to read AES' filings to learn more about the risk
factors associated with AES' business. AES undertakes no obligation
to update or revise any forward-looking statements, whether as a
result of new information, future events or otherwise.
Any Stockholder who desires a copy of the Company's 2020 Annual
Report on Form 10-K filed February 24, 2021 with the SEC may
obtain a copy (excluding Exhibits) without charge by addressing a
request to the Office of the Corporate Secretary, The AES
Corporation, 4300 Wilson Boulevard, Arlington, Virginia 22203. Exhibits also may
be requested, but a charge equal to the reproduction cost thereof
will be made. A copy of the Form 10-K may be obtained by visiting
the Company's website at www.aes.com.
Website Disclosure
AES uses its website, including its quarterly updates, as
channels of distribution of Company information. The
information AES posts through these channels may be deemed
material. Accordingly, investors should monitor our website,
in addition to following AES' press releases, quarterly SEC filings
and public conference calls and webcasts. In addition, you
may automatically receive e-mail alerts and other information about
AES when you enroll your e-mail address by visiting the "Subscribe
to Alerts" page of AES' Investors website. The contents of
AES' website, including its quarterly updates, are not, however,
incorporated by reference into this release.
Disclosure Regarding Fluence
This news release does not constitute an offer to sell or the
solicitation of an offer to buy an securities of Fluence or any of
its affiliates. Any offers, solicitations or offers to buy,
or any sales of such securities will be made in accordance with the
registration requirements of the Securities Act of 1933, as
amended.
|
THE AES
CORPORATION
|
|
Condensed
Consolidated Statements of Operations (Unaudited)
|
|
|
Three Months Ended
June 30,
|
|
Six Months Ended
June 30,
|
|
2021
|
|
2020
|
|
2021
|
|
2020
|
|
(in millions, except
per share amounts)
|
|
Revenue:
|
|
|
|
|
|
|
|
|
Regulated
|
$
|
672
|
|
|
$
|
624
|
|
|
$
|
1,379
|
|
|
$
|
1,336
|
|
|
Non-Regulated
|
2,028
|
|
|
1,593
|
|
|
3,956
|
|
|
3,219
|
|
|
Total
revenue
|
2,700
|
|
|
2,217
|
|
|
5,335
|
|
|
4,555
|
|
|
Cost of
Sales:
|
|
|
|
|
|
|
|
|
Regulated
|
(580)
|
|
|
(535)
|
|
|
(1,162)
|
|
|
(1,127)
|
|
|
Non-Regulated
|
(1,392)
|
|
|
(1,158)
|
|
|
(2,781)
|
|
|
(2,397)
|
|
|
Total cost of
sales
|
(1,972)
|
|
|
(1,693)
|
|
|
(3,943)
|
|
|
(3,524)
|
|
|
Operating
margin
|
728
|
|
|
524
|
|
|
1,392
|
|
|
1,031
|
|
|
General and
administrative expenses
|
(45)
|
|
|
(40)
|
|
|
(91)
|
|
|
(78)
|
|
|
Interest
expense
|
(237)
|
|
|
(218)
|
|
|
(427)
|
|
|
(451)
|
|
|
Interest
income
|
73
|
|
|
64
|
|
|
141
|
|
|
134
|
|
|
Loss on extinguishment
of debt
|
(18)
|
|
|
(40)
|
|
|
(19)
|
|
|
(41)
|
|
|
Other
expense
|
(4)
|
|
|
(3)
|
|
|
(20)
|
|
|
(7)
|
|
|
Other
income
|
183
|
|
|
9
|
|
|
226
|
|
|
54
|
|
|
Gain (loss) on
disposal and sale of business interests
|
64
|
|
|
(27)
|
|
|
59
|
|
|
(27)
|
|
|
Asset impairment
expense
|
(872)
|
|
|
—
|
|
|
(1,345)
|
|
|
(6)
|
|
|
Foreign currency
transaction gains (losses)
|
(2)
|
|
|
(6)
|
|
|
(37)
|
|
|
18
|
|
|
Other non-operating
expense
|
—
|
|
|
(158)
|
|
|
—
|
|
|
(202)
|
|
|
INCOME (LOSS) FROM
CONTINUING OPERATIONS BEFORE TAXES AND EQUITY IN
EARNINGS OF AFFILIATES
|
(130)
|
|
|
105
|
|
|
(121)
|
|
|
425
|
|
|
Income tax benefit
(expense)
|
59
|
|
|
(113)
|
|
|
51
|
|
|
(202)
|
|
|
Net equity in earnings
(losses) of affiliates
|
(10)
|
|
|
8
|
|
|
(40)
|
|
|
6
|
|
|
INCOME (LOSS) FROM
CONTINUING OPERATIONS
|
(81)
|
|
|
—
|
|
|
(110)
|
|
|
229
|
|
|
Gain from disposal of
discontinued businesses
|
4
|
|
|
3
|
|
|
4
|
|
|
3
|
|
|
NET INCOME
(LOSS)
|
(77)
|
|
|
3
|
|
|
(106)
|
|
|
232
|
|
|
Noncontrolling
interests:
|
|
|
|
|
|
|
|
|
Less: Loss (income)
from continuing operations attributable to noncontrolling interests
and
redeemable stock of subsidiaries
|
105
|
|
|
(86)
|
|
|
(14)
|
|
|
(171)
|
|
|
NET INCOME (LOSS)
ATTRIBUTABLE TO THE AES CORPORATION
|
$
|
28
|
|
|
$
|
(83)
|
|
|
$
|
(120)
|
|
|
$
|
61
|
|
|
BASIC EARNINGS PER
SHARE:
|
|
|
|
|
|
|
|
|
NET INCOME (LOSS)
ATTRIBUTABLE TO THE AES CORPORATION COMMON
STOCKHOLDERS
|
$
|
0.04
|
|
|
$
|
(0.12)
|
|
|
$
|
(0.18)
|
|
|
$
|
0.09
|
|
|
DILUTED EARNINGS PER
SHARE:
|
|
|
|
|
|
|
|
|
NET INCOME (LOSS)
ATTRIBUTABLE TO THE AES CORPORATION COMMON
STOCKHOLDERS
|
$
|
0.04
|
|
|
$
|
(0.12)
|
|
|
$
|
(0.18)
|
|
|
$
|
0.09
|
|
|
DILUTED SHARES
OUTSTANDING
|
670
|
|
|
665
|
|
|
666
|
|
|
668
|
|
|
THE AES
CORPORATION
|
|
Strategic Business
Unit (SBU) Information
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
Three Months Ended
June 30,
|
|
Six Months Ended
June 30,
|
|
(in
millions)
|
2021
|
|
2020
|
|
2021
|
|
2020
|
|
REVENUE
|
|
|
|
|
|
|
|
|
US and Utilities
SBU
|
$
|
972
|
|
|
$
|
913
|
|
|
$
|
1,921
|
|
|
$
|
1,884
|
|
|
South America
SBU
|
964
|
|
|
711
|
|
|
1,848
|
|
|
1,423
|
|
|
MCAC SBU
|
490
|
|
|
381
|
|
|
1,025
|
|
|
813
|
|
|
Eurasia SBU
|
277
|
|
|
214
|
|
|
547
|
|
|
439
|
|
|
Corporate and
Other
|
37
|
|
|
114
|
|
|
61
|
|
|
142
|
|
|
Eliminations
|
(40)
|
|
|
(116)
|
|
|
(67)
|
|
|
(146)
|
|
|
Total
Revenue
|
$
|
2,700
|
|
|
$
|
2,217
|
|
|
$
|
5,335
|
|
|
$
|
4,555
|
|
|
THE AES
CORPORATION
|
|
Condensed
Consolidated Balance Sheets (Unaudited)
|
|
|
June 30,
2021
|
|
December 31,
2020
|
|
(in millions, except
share
and per share data)
|
|
ASSETS
|
|
|
|
|
CURRENT
ASSETS
|
|
|
|
|
Cash and cash
equivalents
|
$
|
1,213
|
|
|
$
|
1,089
|
|
|
Restricted
cash
|
404
|
|
|
297
|
|
|
Short-term
investments
|
282
|
|
|
335
|
|
|
Accounts receivable,
net of allowance for doubtful accounts of $10 and $13,
respectively
|
1,374
|
|
|
1,300
|
|
|
Inventory
|
445
|
|
|
461
|
|
|
Prepaid
expenses
|
114
|
|
|
102
|
|
|
Other current assets,
net of allowance of $0
|
868
|
|
|
726
|
|
|
Current held-for-sale
assets
|
830
|
|
|
1,104
|
|
|
Total current
assets
|
5,530
|
|
|
5,414
|
|
|
NONCURRENT
ASSETS
|
|
|
|
|
Property, Plant and
Equipment:
|
|
|
|
|
Land
|
415
|
|
|
417
|
|
|
Electric generation,
distribution assets and other
|
24,786
|
|
|
26,707
|
|
|
Accumulated
depreciation
|
(7,970)
|
|
|
(8,472)
|
|
|
Construction in
progress
|
5,351
|
|
|
4,174
|
|
|
Property, plant and
equipment, net
|
22,582
|
|
|
22,826
|
|
|
Other
Assets:
|
|
|
|
|
Investments in and
advances to affiliates
|
793
|
|
|
835
|
|
|
Debt service reserves
and other deposits
|
409
|
|
|
441
|
|
|
Goodwill
|
1,110
|
|
|
1,061
|
|
|
Other intangible
assets, net of accumulated amortization of $365 and $330,
respectively
|
900
|
|
|
827
|
|
|
Deferred income
taxes
|
300
|
|
|
288
|
|
|
Other noncurrent
assets, net of allowance of $21 and $21, respectively
|
1,892
|
|
|
1,660
|
|
|
Noncurrent
held-for-sale assets
|
1,211
|
|
|
1,251
|
|
|
Total other
assets
|
6,615
|
|
|
6,363
|
|
|
TOTAL
ASSETS
|
$
|
34,727
|
|
|
$
|
34,603
|
|
|
LIABILITIES AND
EQUITY
|
|
|
|
|
CURRENT
LIABILITIES
|
|
|
|
|
Accounts
payable
|
$
|
948
|
|
|
$
|
1,156
|
|
|
Accrued
interest
|
199
|
|
|
191
|
|
|
Accrued non-income
taxes
|
207
|
|
|
257
|
|
|
Deferred
income
|
139
|
|
|
438
|
|
|
Accrued and other
liabilities
|
927
|
|
|
1,223
|
|
|
Non-recourse debt,
including $337 and $336, respectively, related to variable interest
entities
|
1,345
|
|
|
1,430
|
|
|
Current held-for-sale
liabilities
|
572
|
|
|
667
|
|
|
Total current
liabilities
|
4,337
|
|
|
5,362
|
|
|
NONCURRENT
LIABILITIES
|
|
|
|
|
Recourse
debt
|
3,374
|
|
|
3,446
|
|
|
Non-recourse debt,
including $3,953 and $3,918, respectively, related to variable
interest entities
|
15,290
|
|
|
15,005
|
|
|
Deferred income
taxes
|
1,121
|
|
|
1,100
|
|
|
Other noncurrent
liabilities
|
3,259
|
|
|
3,241
|
|
|
Noncurrent
held-for-sale liabilities
|
800
|
|
|
857
|
|
|
Total noncurrent
liabilities
|
23,844
|
|
|
23,649
|
|
|
Commitments and
Contingencies
|
|
|
|
|
Redeemable stock of
subsidiaries
|
1,149
|
|
|
872
|
|
|
EQUITY
|
|
|
|
|
THE AES CORPORATION
STOCKHOLDERS' EQUITY
|
|
|
|
|
Preferred stock
(without par value, 50,000,000 shares authorized; 1,043,500 issued
and outstanding at June 30, 2021)
|
1,043
|
|
|
—
|
|
|
Common stock ($0.01
par value, 1,200,000,000 shares authorized; 818,662,357 issued and
666,329,509 outstanding at June 30, 2021 and 818,398,654 issued
and 665,370,128 outstanding at December 31, 2020)
|
8
|
|
|
8
|
|
|
Additional paid-in
capital
|
7,211
|
|
|
7,561
|
|
|
Accumulated
deficit
|
(800)
|
|
|
(680)
|
|
|
Accumulated other
comprehensive loss
|
(2,347)
|
|
|
(2,397)
|
|
|
Treasury stock, at
cost (152,332,848 and 153,028,526 shares at June 30, 2021 and
December 31, 2020, respectively)
|
(1,850)
|
|
|
(1,858)
|
|
|
Total AES Corporation
stockholders' equity
|
3,265
|
|
|
2,634
|
|
|
NONCONTROLLING
INTERESTS
|
2,132
|
|
|
2,086
|
|
|
Total
equity
|
5,397
|
|
|
4,720
|
|
|
TOTAL LIABILITIES AND
EQUITY
|
$
|
34,727
|
|
|
$
|
34,603
|
|
|
THE AES
CORPORATION
|
|
Condensed
Consolidated Statements of Cash Flows
|
|
(Unaudited)
|
|
|
Three Months Ended
June 30,
|
|
Six Months Ended
June 30,
|
|
2021
|
|
2020
|
|
2021
|
|
2020
|
|
(in
millions)
|
|
(in
millions)
|
|
OPERATING
ACTIVITIES:
|
|
|
|
|
|
|
|
|
Net income
(loss)
|
$
|
(77)
|
|
|
$
|
3
|
|
|
$
|
(106)
|
|
|
$
|
232
|
|
|
Adjustments to net
income (loss):
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
263
|
|
|
271
|
|
|
538
|
|
|
539
|
|
|
Loss (gain) on disposal
and sale of business interests
|
(64)
|
|
|
27
|
|
|
(59)
|
|
|
27
|
|
|
Impairment
expense
|
872
|
|
|
158
|
|
|
1,345
|
|
|
208
|
|
|
Deferred income
taxes
|
(94)
|
|
|
52
|
|
|
(73)
|
|
|
54
|
|
|
Loss on extinguishment
of debt
|
18
|
|
|
40
|
|
|
19
|
|
|
41
|
|
|
Loss (gain) on sale and
disposal of assets
|
4
|
|
|
2
|
|
|
20
|
|
|
(40)
|
|
|
Gain on remeasurement
to acquisition date fair value
|
(176)
|
|
|
—
|
|
|
(212)
|
|
|
—
|
|
|
Loss of affiliates, net
of dividends
|
10
|
|
|
(6)
|
|
|
46
|
|
|
2
|
|
|
Other
|
186
|
|
|
23
|
|
|
263
|
|
|
23
|
|
|
Changes in operating
assets and liabilities:
|
|
|
|
|
|
|
|
|
(Increase) decrease in
accounts receivable
|
(41)
|
|
|
10
|
|
|
(120)
|
|
|
(30)
|
|
|
(Increase) decrease in
inventory
|
(7)
|
|
|
(69)
|
|
|
7
|
|
|
(46)
|
|
|
(Increase) decrease in
prepaid expenses and other current assets
|
(35)
|
|
|
56
|
|
|
(13)
|
|
|
33
|
|
|
(Increase) decrease in
other assets
|
(23)
|
|
|
4
|
|
|
8
|
|
|
(75)
|
|
|
Increase (decrease) in
accounts payable and other current liabilities
|
45
|
|
|
18
|
|
|
(292)
|
|
|
(81)
|
|
|
Increase (decrease) in
income tax payables, net and other tax payables
|
(347)
|
|
|
(103)
|
|
|
(439)
|
|
|
(67)
|
|
|
Increase (decrease) in
deferred income
|
(165)
|
|
|
10
|
|
|
(307)
|
|
|
39
|
|
|
Increase (decrease) in
other liabilities
|
(18)
|
|
|
(49)
|
|
|
(21)
|
|
|
(39)
|
|
|
Net cash provided by
operating activities
|
351
|
|
|
447
|
|
|
604
|
|
|
820
|
|
|
INVESTING
ACTIVITIES:
|
|
|
|
|
|
|
|
|
Capital
expenditures
|
(567)
|
|
|
(386)
|
|
|
(999)
|
|
|
(962)
|
|
|
Acquisitions of
business interests, net of cash and restricted cash
acquired
|
(81)
|
|
|
(74)
|
|
|
(81)
|
|
|
(84)
|
|
|
Proceeds from the sale
of business interests, net of cash and restricted cash
sold
|
58
|
|
|
44
|
|
|
58
|
|
|
44
|
|
|
Sale of short-term
investments
|
59
|
|
|
87
|
|
|
316
|
|
|
341
|
|
|
Purchase of short-term
investments
|
(128)
|
|
|
(186)
|
|
|
(258)
|
|
|
(463)
|
|
|
Contributions and
loans to equity affiliates
|
(109)
|
|
|
(63)
|
|
|
(173)
|
|
|
(178)
|
|
|
Other
investing
|
10
|
|
|
(48)
|
|
|
(8)
|
|
|
(59)
|
|
|
Net cash used in
investing activities
|
(758)
|
|
|
(626)
|
|
|
(1,145)
|
|
|
(1,361)
|
|
|
FINANCING
ACTIVITIES:
|
|
|
|
|
|
|
|
|
Borrowings under the
revolving credit facilities
|
206
|
|
|
124
|
|
|
998
|
|
|
1,318
|
|
|
Repayments under the
revolving credit facilities
|
(139)
|
|
|
(643)
|
|
|
(932)
|
|
|
(958)
|
|
|
Issuance of recourse
debt
|
—
|
|
|
1,597
|
|
|
7
|
|
|
1,597
|
|
|
Repayments of recourse
debt
|
—
|
|
|
(1,578)
|
|
|
(7)
|
|
|
(1,596)
|
|
|
Issuance of
non-recourse debt
|
393
|
|
|
1,507
|
|
|
700
|
|
|
1,913
|
|
|
Repayments of
non-recourse debt
|
(619)
|
|
|
(671)
|
|
|
(939)
|
|
|
(763)
|
|
|
Payments for financing
fees
|
(7)
|
|
|
(41)
|
|
|
(12)
|
|
|
(46)
|
|
|
Distributions to
noncontrolling interests
|
(112)
|
|
|
(77)
|
|
|
(129)
|
|
|
(99)
|
|
|
Acquisitions of
noncontrolling interests
|
(4)
|
|
|
—
|
|
|
(17)
|
|
|
—
|
|
|
Contributions from
noncontrolling interests
|
1
|
|
|
—
|
|
|
95
|
|
|
—
|
|
|
Issuance of preferred
shares in subsidiaries
|
151
|
|
|
—
|
|
|
151
|
|
|
—
|
|
|
Issuance of preferred
stock
|
(2)
|
|
|
—
|
|
|
1,015
|
|
|
—
|
|
|
Dividends paid on AES
common stock
|
(100)
|
|
|
(95)
|
|
|
(200)
|
|
|
(190)
|
|
|
Payments for financed
capital expenditures
|
(3)
|
|
|
(29)
|
|
|
(4)
|
|
|
(39)
|
|
|
Other
financing
|
(76)
|
|
|
34
|
|
|
(44)
|
|
|
21
|
|
|
Net cash provided by
financing activities
|
(311)
|
|
|
128
|
|
|
682
|
|
|
1,158
|
|
|
Effect of exchange
rate changes on cash, cash equivalents and restricted
cash
|
18
|
|
|
(5)
|
|
|
(4)
|
|
|
(37)
|
|
|
(Increase) decrease in
cash, cash equivalents and restricted cash of held-for-sale
businesses
|
120
|
|
|
(47)
|
|
|
62
|
|
|
(45)
|
|
|
Total increase in
cash, cash equivalents and restricted cash
|
(580)
|
|
|
(103)
|
|
|
199
|
|
|
535
|
|
|
Cash, cash equivalents
and restricted cash, beginning
|
2,606
|
|
|
2,210
|
|
|
1,827
|
|
|
1,572
|
|
|
Cash, cash equivalents
and restricted cash, ending
|
$
|
2,026
|
|
|
$
|
2,107
|
|
|
$
|
2,026
|
|
|
$
|
2,107
|
|
|
SUPPLEMENTAL
DISCLOSURES:
|
|
|
|
|
|
|
|
|
Cash payments for
interest, net of amounts capitalized
|
$
|
239
|
|
|
$
|
295
|
|
|
$
|
406
|
|
|
$
|
458
|
|
|
Cash payments for
income taxes, net of refunds
|
322
|
|
|
124
|
|
|
372
|
|
|
176
|
|
|
SCHEDULE OF NONCASH
INVESTING AND FINANCING ACTIVITIES:
|
|
|
|
|
|
|
|
|
Non-cash consideration
transferred for the Clean Energy transaction
|
$
|
(20)
|
|
|
$
|
—
|
|
|
99
|
|
|
—
|
|
THE AES CORPORATION
NON-GAAP FINANCIAL MEASURES
(Unaudited)
RECONCILIATION OF ADJUSTED PRE-TAX CONTRIBUTION (PTC) AND ADJUSTED
EPS
Adjusted PTC is defined as pre-tax income from continuing
operations attributable to The AES Corporation excluding gains or
losses of the consolidated entity due to (a) unrealized gains
or losses related to derivative transactions and equity securities;
(b) unrealized foreign currency gains or losses;
(c) gains, losses, benefits and costs associated with
dispositions and acquisitions of business interests, including
early plant closures, and gains and losses recognized at
commencement of sales-type leases; (d) losses due to
impairments; (e) gains, losses and costs due to the early
retirement of debt; and (f) net gains at Angamos, one of our
businesses in the South America SBU, associated with the early
contract terminations with Minera Escondida and Minera Spence. Adjusted PTC also includes
net equity in earnings of affiliates on an after-tax basis adjusted
for the same gains or losses excluded from consolidated
entities.
Adjusted EPS is defined as diluted earnings per share from
continuing operations excluding gains or losses of both
consolidated entities and entities accounted for under the equity
method due to (a) unrealized gains or losses related to
derivative transactions and equity securities; (b) unrealized
foreign currency gains or losses; (c) gains, losses, benefits
and costs associated with dispositions and acquisitions of business
interests, including early plant closures, and the tax impact from
the repatriation of sales proceeds, and gains and losses recognized
at commencement of sales-type leases; (d) losses due to
impairments; (e) gains, losses and costs due to the early
retirement of debt; (f) net gains at Angamos, one of our businesses
in the South America SBU, associated with the early contract
terminations with Minera Escondida and Minera Spence; and (g) tax
benefit or expense related to the enactment effects of 2017 U.S.
tax law reform and related regulations and any subsequent period
adjustments related to enactment effects.
The GAAP measure most comparable to Adjusted PTC is income from
continuing operations attributable to AES. The GAAP measure most
comparable to Adjusted EPS is diluted earnings per share from
continuing operations. We believe that Adjusted PTC and Adjusted
EPS better reflect the underlying business performance of the
Company and are considered in the Company's internal evaluation of
financial performance. Factors in this determination include
the variability due to unrealized gains or losses related to
derivative transactions or equity securities remeasurement,
unrealized foreign currency gains or losses, losses due to
impairments, strategic decisions to dispose of or acquire business
interests or retire debt, and the non-recurring nature of the
impact of the early contract terminations at Angamos, which affect
results in a given period or periods. In addition, for Adjusted
PTC, earnings before tax represents the business performance of the
Company before the application of statutory income tax rates and
tax adjustments, including the effects of tax planning,
corresponding to the various jurisdictions in which the Company
operates. Adjusted PTC and Adjusted EPS should not be construed as
alternatives to income from continuing operations attributable to
AES and diluted earnings per share from continuing operations,
which are determined in accordance with GAAP.
|
Three Months
Ended
June 30, 2021
|
|
Three Months
Ended
June 30, 2020
|
|
Six Months Ended
June
30, 2021
|
|
Six Months Ended
June
30, 2020
|
|
|
Net of NCI
(1)
|
|
Per Share
(Diluted)
Net of NCI (1)
|
|
Net of NCI
(1)
|
|
Per Share
(Diluted)
Net of NCI (1)
|
|
Net of NCI
(1)
|
|
Per Share
(Diluted)
Net of NCI (1)
|
|
Net of NCI
(1)
|
|
Per Share
(Diluted)
Net of NCI (1)
|
|
|
(in millions,
except per share amounts)
|
|
|
Income (loss) from
continuing operations,
net of tax, attributable to AES and Diluted
EPS
|
$
|
24
|
|
|
$
|
0.03
|
|
|
$
|
(86)
|
|
|
$
|
(0.13)
|
|
|
$
|
(124)
|
|
|
$
|
(0.19)
|
|
|
$
|
58
|
|
|
$
|
0.09
|
|
|
|
Add: Income tax
expense (benefit) from
continuing operations attributable to AES
|
(24)
|
|
|
|
|
81
|
|
|
|
|
(60)
|
|
|
|
|
136
|
|
|
|
|
|
Pre-tax
contribution
|
$
|
—
|
|
|
|
|
$
|
(5)
|
|
|
|
|
$
|
(184)
|
|
|
|
|
$
|
194
|
|
|
|
|
|
Adjustments
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Unrealized derivative
and equity securities
losses (gains)
|
$
|
8
|
|
|
$
|
0.01
|
|
|
$
|
14
|
|
|
$
|
0.02
|
|
|
$
|
77
|
|
|
$
|
0.12
|
|
(2)
|
$
|
(2)
|
|
|
$
|
—
|
|
|
|
Unrealized foreign
currency losses
|
(12)
|
|
|
(0.02)
|
|
|
(12)
|
|
|
(0.01)
|
|
|
(6)
|
|
|
(0.01)
|
|
|
(3)
|
|
|
—
|
|
|
|
Disposition/acquisition losses (gains)
|
(229)
|
|
|
(0.34)
|
|
(3)
|
29
|
|
|
0.04
|
|
(4)
|
(244)
|
|
|
(0.37)
|
|
(5)
|
30
|
|
|
0.04
|
|
(4)
|
|
Impairment
losses
|
628
|
|
|
0.94
|
|
(6)
|
168
|
|
|
0.25
|
|
(7)
|
1,103
|
|
|
1.65
|
|
(8)
|
221
|
|
|
0.33
|
|
(9)
|
|
Loss on
extinguishment of debt
|
18
|
|
|
0.03
|
|
(10)
|
44
|
|
|
0.07
|
|
(11)
|
24
|
|
|
0.04
|
|
(10)
|
48
|
|
|
0.07
|
|
(11)
|
|
Net gains from early
contract terminations at
Angamos
|
(110)
|
|
|
(0.16)
|
|
(12)
|
—
|
|
|
—
|
|
|
(220)
|
|
|
(0.33)
|
|
(12)
|
—
|
|
|
—
|
|
|
|
U.S. Tax Law Reform
Impact
|
|
|
—
|
|
|
|
|
0.02
|
|
(13)
|
|
|
—
|
|
|
|
|
0.02
|
|
(13)
|
|
Less: Net income tax
benefit
|
|
|
(0.18)
|
|
(14)
|
|
|
(0.01)
|
|
|
|
|
(0.32)
|
|
(15)
|
|
|
(0.01)
|
|
|
|
Adjusted PTC and
Adjusted EPS
|
$
|
303
|
|
|
$
|
0.31
|
|
|
$
|
238
|
|
|
$
|
0.25
|
|
|
$
|
550
|
|
|
$
|
0.59
|
|
|
$
|
488
|
|
|
$
|
0.54
|
|
|
|
_____________________________
|
|
|
(1)
|
NCI is defined as
Noncontrolling Interests.
|
|
(2)
|
Amount primarily
relates to unrealized derivative losses in Argentina mainly
associated with foreign currency derivatives on government
receivables of $41 million, or $0.06 per share, and net unrealized
derivative losses on power and commodities swaps at Southland of
$32 million, or $0.05 per share.
|
|
(3)
|
Amount primarily
relates to an adjustment on the gain on remeasurement of our equity
interest in sPower to acquisition-date fair value of $176 million,
or $0.26, and gain on Fluence issuance of shares of $61 million, or
$0.09 per share.
|
|
(4)
|
Amount primarily
relates to loss on sale of the Kazakhstan HPPs of $30 million, or
$0.05 per share, as result of the final arbitration
decision.
|
|
(5)
|
Amount primarily
relates to an adjustment on the gain on remeasurement of our equity
interest in sPower to acquisition-date fair value of $212 million,
or $0.32, and gain on Fluence issuance of shares of $61 million, or
$0.09 per share, partially offset by day-one loss recognized at
commencement of a sales-type lease at AES Distributed Energy of $13
million, or $0.02 per share.
|
|
(6)
|
Amount primarily
relates to asset impairments at AES Andes of $540 million, or $0.81
per share, at Mountain View of $67 million, or $0.10 per share, and
at sPower of $20 million, or $0.03 per share.
|
|
(7)
|
Amount primarily
relates to other-than-temporary impairment of OPGC of $158 million,
or $0.24 per share, and impairments at our sPower equity affiliate,
impacting equity earnings by $10 million, or $0.01 per
share.
|
|
(8)
|
Amount primarily
relates to asset impairments at AES Andes of $540 million, or $0.81
per share, at Puerto Rico of $475 million, or $0.71 per share, at
Mountain View of $67 million, or $0.10 per share, and at sPower of
$21 million, or $0.03 per share.
|
|
(9)
|
Amount primarily
relates to other-than-temporary impairment of OPGC of $201 million,
or $0.30 per share, and impairments at our sPower equity affiliate,
impacting equity earnings by $15 million, or $0.02 per
share.
|
|
(10)
|
Amount primarily
relates to loss on early retirement of debt at Andres and Los Mina
of $15 million, or $0.02 per share.
|
|
(11)
|
Amount primarily
relates to loss on early retirement of debt at the Parent Company
of $37 million, or $0.06 per share.
|
|
(12)
|
Amount relates to net
gains at Angamos associated with the early contract terminations
with Minera Escondida and Minera Spence of $110 million, or $0.16
per share and $220 million, or $0.33 per share for the three and
six months ended June 30, 2021, respectively.
|
|
(13)
|
Amount represents
adjustment to tax law reform remeasurement due to incremental
deferred taxes related to DPL of $16 million, or $0.02 per
share.
|
|
(14)
|
Amount primarily
relates to income tax benefits associated with the impairments at
AES Andes of $195 million, or $0.29 per share and at Mountain View
of $21 million, or $0.03, partially offset by income tax expense
related to net gains at Angamos associated with the early contract
terminations with Minera Escondida and Minera Spence of $51
million, or $0.08 per share, income tax expense related to the gain
on remeasurement of our equity interest in sPower to
acquisition-date fair value of $39 million, or $0.06 per share, and
income tax expense related to the gain on Fluence issuance of
shares of $13 million, or $0.02 per share.
|
|
(15)
|
Amount primarily
relates to income tax benefits associated with the impairments at
AES Andes of $195 million, or $0.29 per share, at Puerto Rico of
$114 million, or $0.17 per share, and at Mountain View of $21
million, or $0.03, partially offset by income tax expense related
to net gains at Angamos associated with the early contract
terminations with Minera Escondida and Minera Spence of $79
million, or $0.12 per share, income tax expense related to the gain
on remeasurement of our equity interest in sPower to
acquisition-date fair value of $46 million, or $0.07 per share, and
income tax expense related to the gain on Fluence issuance of
shares of $13 million, or $0.02 per share.
|
|
The AES
Corporation
|
|
Parent Financial
Information
|
|
Parent only data:
last four quarters
|
|
|
|
|
|
(in
millions)
|
4 Quarters
Ended
|
|
Total subsidiary
distributions & returns of capital to Parent
|
June 30,
2021
|
March 31,
2021
|
December 31,
2020
|
September
30, 2020
|
|
Actual
|
Actual
|
Actual
|
Actual
|
|
Subsidiary
distributions1 to Parent & QHCs
|
$
|
966
|
|
$
|
1,203
|
|
$
|
1,145
|
|
$
|
1,206
|
|
|
Returns of capital
distributions to Parent & QHCs
|
(118)
|
|
45
|
|
45
|
|
182
|
|
|
Total subsidiary
distributions & returns of capital to Parent
|
$
|
848
|
|
$
|
1,248
|
|
$
|
1,190
|
|
$
|
1,388
|
|
|
Parent only data:
quarterly
|
|
|
|
|
|
(in
millions)
|
Quarter
Ended
|
|
Total subsidiary
distributions & returns of capital to Parent
|
June 30,
2021
|
March 31,
2021
|
December 31,
2020
|
September
30, 2020
|
|
Actual
|
Actual
|
Actual
|
Actual
|
|
Subsidiary
distributions1 to Parent & QHCs
|
$
|
164
|
|
$
|
247
|
|
$
|
335
|
|
$
|
220
|
|
|
Returns of capital
distributions to Parent & QHCs
|
—
|
|
—
|
|
(118)
|
|
—
|
|
|
Total subsidiary
distributions & returns of capital to Parent
|
$
|
164
|
|
$
|
247
|
|
$
|
217
|
|
$
|
220
|
|
|
|
|
(in
millions)
|
Balance
at
|
|
June 30,
2021
|
March 31,
2021
|
December 31,
2020
|
September
30, 2020
|
|
Parent Company
Liquidity2
|
Actual
|
Actual
|
Actual
|
Actual
|
|
Cash at Parent &
Cash at QHCs3
|
$
|
373
|
|
$
|
565
|
|
$
|
71
|
|
$
|
26
|
|
|
Availability under
credit facilities
|
941
|
|
916
|
|
853
|
|
274
|
|
|
Ending
liquidity
|
$
|
1,314
|
|
$
|
1,481
|
|
$
|
924
|
|
$
|
300
|
|
|
____________________________
|
|
|
(1)
|
Subsidiary
distributions received by Qualified Holding Companies ("QHCs")
excluded from Schedule 1. Subsidiary Distributions should not be
construed as an alternative to Consolidated Net Cash Provided by
Operating Activities, which is determined in accordance with US
GAAP. Subsidiary Distributions are important to the Parent
Company because the Parent Company is a holding company that does
not derive any significant direct revenues from its own activities
but instead relies on its subsidiaries' business activities and the
resultant distributions to fund the debt service, investment and
other cash needs of the holding company. The reconciliation of
the difference between the Subsidiary Distributions and
Consolidated Net Cash Provided by Operating Activities consists of
cash generated from operating activities that is retained at the
subsidiaries for a variety of reasons which are both discretionary
and non-discretionary in nature. These factors include, but
are not limited to, retention of cash to fund capital expenditures
at the subsidiary, cash retention associated with non-recourse debt
covenant restrictions and related debt service requirements at the
subsidiaries, retention of cash related to sufficiency of local
GAAP statutory retained earnings at the subsidiaries, retention of
cash for working capital needs at the subsidiaries, and other
similar timing differences between when the cash is generated at
the subsidiaries and when it reaches the Parent Company and related
holding companies.
|
|
(2)
|
Parent Company
Liquidity is defined as cash available to the Parent Company,
including cash at qualified holding companies (QHCs), plus
available borrowings under our existing credit facility. AES
believes that unconsolidated Parent Company liquidity is important
to the liquidity position of AES as a Parent Company because of the
non-recourse nature of most of AES' indebtedness.
|
|
(3)
|
The cash held at QHCs
represents cash sent to subsidiaries of the company domiciled
outside of the US. Such subsidiaries have no contractual
restrictions on their ability to send cash to AES, the Parent
Company. Cash at those subsidiaries was used for investment and
related activities outside of the US. These investments included
equity investments and loans to other foreign subsidiaries as well
as development and general costs and expenses incurred outside the
US. Since the cash held by these QHCs is available to the Parent,
AES uses the combined measure of subsidiary distributions to Parent
and QHCs as a useful measure of cash available to the Parent to
meet its international liquidity needs.
|
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SOURCE The AES Corporation