Market Overview

Dynegy Announces 2017 Second Quarter Results

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Dynegy Inc. (NYSE:DYN):

Summary of Second Quarter 2017 Financial Results (in millions):

         

Three Months Ended
June 30,

 

Six Months Ended
June 30,

2017   2016 2017   2016
Operating Revenues $ 1,164 $ 904 $ 2,411 $ 2,027
Net Income (loss) $ (296 ) $ (803 ) $ 300 $ (813 )
Adjusted EBITDA (1) $ 240 $ 187 $ 470 $ 438
 

Reaffirming 2017 Guidance Ranges (in millions):

Adjusted EBITDA (1)           $1,200 - $1,400
Adjusted Free Cash Flow (1) $300 - $500
 

Second Quarter Operating Highlights:

  • Achieved top decile safety performance across the entire company
  • Generated more than 25 million megawatt hours
  • Ceased operations at Brayton Point facility on May 31; related
    inventory financing fully repaid
  • Outstanding collateral declined by approximately $85 million during
    the quarter
  • $1.4 billion in liquidity at June 30, 2017; excludes asset sale
    proceeds of approximately $480 million received in July

Portfolio Transformation:

  • Completed sale of Troy and Armstrong facilities; received
    approximately $480 million in cash proceeds
  • Announced sale of Dighton, Lee and Milford (MA) facilities for
    approximately $300 million
  • Completed 43 MW of uprates at Liberty and Milford (CT) averaging
    $175/kW
  • Closed Conesville/Zimmer transaction with AEP

__________________________________________

(1)   Adjusted EBITDA and Adjusted Free Cash Flow are non-GAAP financial
measures. See "Regulation G Reconciliations" for further details.
 

Dynegy Inc. (NYSE:DYN) reported a net loss of $296 million for the
second quarter of 2017, compared to a net loss of $803 million for the
second quarter of 2016. Results for the most recent quarter were
impacted by positive contributions from assets acquired from ENGIE
(ENGIE assets) in February 2017 and a non-cash asset impairment related
to certain coal facilities in MISO. Results for the second quarter of
2016 were negatively impacted by a non-cash asset impairment charge
related to the retirement of certain generation units last year.

The Company reported consolidated Adjusted EBITDA of $240 million for
the 2017 second quarter compared to $187 million for the 2016 second
quarter as the positive contribution from the ENGIE assets and higher
capacity revenues in the MISO and IPH segments more than offset lower
energy margins in PJM.

Net income for the first half of 2017 was $300 million compared to a net
loss of $813 million for the first half of 2016. The year-to-date
increase was primarily driven by a $329 million deferred tax valuation
allowance reversal, a $482 million gain related to the Genco financial
restructuring and contributions from the ENGIE assets, while second
quarter 2016 results were impacted by the asset impairment noted above.

For the first half of 2017, the Company reported consolidated Adjusted
EBITDA of $470 million compared to $438 million for the first half of
2016. The $32 million increase in Adjusted EBITDA was primarily driven
by the ENGIE assets. Partially offsetting these improvements were
compressed energy margins, particularly in our natural gas fleet, as
natural gas prices rose faster than power prices which compressed spark
spreads during the period.

"Going into the second quarter, our priorities were to prepare the fleet
and workforce for the important summer season, hit our financial targets
and increase our liquidity in preparation for the pay down of our 2019
debt maturity later this year. By all measures we had a very successful
quarter," said Robert Flexon, Dynegy President and Chief Executive
Officer. "The balance of the year will bring added emphasis on analyzing
our operating practices to drive additional efficiencies in preparation
for the next generation of our PRIDE improvement plan and reducing our
leverage."

Second Quarter Comparative Results

    Quarter Ended June 30,
2017   2016
(in millions)

Operating
Income (Loss)

  Adjusted EBITDA (1)

Operating
Income (Loss)

  Adjusted EBITDA (1)
PJM $ 6 $ 168 $ 71 $ 152
NY/NE (1 ) 60 (5 ) 34
ERCOT (30 ) 1

-

-

MISO (98 ) 3 (729 ) 4
IPH 11 47 3 11
CAISO (19 ) (1 ) 4 21
Other (51 ) (38 ) (46 ) (35 )
Total $ (182 ) $ 240   $ (702 ) $ 187  

__________________________________________

(1)   Adjusted EBITDA is a non-GAAP financial measure. See "Regulation G
Reconciliations" for further details.
 

Segment Review of Results Quarter-over-Quarter

PJM - Operating income for the 2017 second quarter totaled $6
million, compared to operating income of $71 million for the same period
of 2016. The decline was primarily due to lower spark spreads, non-cash
mark-to-market losses on derivatives and a non-cash loss associated with
the Conesville/Zimmer ownership interest exchange. Adjusted EBITDA
totaled $168 million during the 2017 second quarter compared to $152
million during the same period in 2016 as contributions from the ENGIE
assets and higher energy margins from the coal fleet more than offset
weaker spark spreads at the gas fleet.

NY/NE - Operating loss for the 2017 second quarter totaled $1
million, compared to operating loss of $5 million for the same period in
2016. Adjusted EBITDA totaled $60 million during the 2017 second
quarter, compared to $34 million during the same period in 2016 with the
increase primarily due to the contributions from the ENGIE assets.

ERCOT - Operating loss for the 2017 second quarter totaled $30
million as energy margin of $29 million was offset by $29 million of O&M
expenses, $21 million of depreciation expense and $8 million of non-cash
mark-to-market losses on derivatives. Adjusted EBITDA was $1 million for
the same period. During the second quarter, Dynegy completed multiple
planned outages at the ERCOT facilities in order to prepare for the
summer cooling season.

MISO - Operating loss for the 2017 second quarter totaled $98
million, compared to an operating loss of $729 million for the same
period in 2016. Previous year results were impacted by asset
impairments, however 2017 results benefited from lower O&M costs and
non-cash mark-to-market income on derivatives. Adjusted EBITDA totaled
$3 million during the 2017 second quarter compared to $4 million during
the same period in 2016.

IPH - Operating income for the 2017 second quarter totaled $11
million, compared to $3 million for the same period of 2016 due to
higher capacity revenues. Adjusted EBITDA totaled $47 million during the
2017 second quarter compared to $11 million during the same period in
2016 due to higher capacity revenues and the receipt of contingent
proceeds in 2017 related to the 2013 Ameren acquisition.

CAISO - Operating loss for the 2017 second quarter totaled $19
million, compared to operating income of $4 million for the same period
in 2016. The decrease is due to lower capacity revenues and higher
depreciation. Adjusted EBITDA loss totaled $1 million during the 2017
second quarter compared to Adjusted EBITDA of $21 million during the
same period in 2016 due to lower capacity revenues and a one-time
supplier settlement in 2016.

Liquidity

As of June 30, 2017, Dynegy's total available liquidity was $1.4 billion
as reflected in the table below.

(amounts in millions)      
Revolving facilities and LC capacity (1) $ 1,650
Less:
Outstanding revolvers (300 )
Outstanding LCs (413 )
Revolving facilities and LC availability 937
Cash and cash equivalents 447  
Total available liquidity $ 1,384  

__________________________________________

(1)   Dynegy Inc. includes $1.5 billion in senior secured revolving credit
facilities and $105 million related to LCs.
 

During the second quarter, outstanding collateral declined by
approximately $85 million primarily due to the AEP transaction closing
and the subsequent return of a $58 million letter of credit, as well as
other collateral efficiency initiatives. Additionally, upon retirement
of the Brayton Point Power Station, the associated inventory financing
was fully paid and extinguished.

Consolidated Cash Flow

Cash provided by operations totaled $230 million for the first half of
2017. During the period, our power generation facilities and retail
operations provided cash of $523 million. Corporate activities,
primarily related to general and administrative, interest and
acquisition-related expenses, as well as other working capital changes,
used cash of $293 million during the period.

Cash used in investing activities totaled $3.3 billion during the first
half of 2017 as Dynegy used $3,263 million at the ENGIE acquisition
closing and invested $86 million in capital expenditures.

Cash used in financing activities totaled $275 million for the first
half of 2017.

2017 Guidance

Dynegy's full-year 2017 Adjusted EBITDA guidance range remains unchanged
at $1,200-1,400 million. The Company's Adjusted free cash flow range is
affirmed at $300-$500 million. The Company is maintaining these guidance
ranges despite foregoing approximately $55 million in forecasted
Adjusted EBITDA from the later than expected closing of the ENGIE
acquisition and the mid-year sale of the Troy and Armstrong facilities
which were included for the full 12 months guidance target when
originally issued.

Retail Growth

Dynegy's business has grown to serve approximately 1.2 million
residential and commercial accounts. The retail business expanded to New
England this summer with its municipal aggregation contracts in the
greater Boston area. The Company now provides electricity to more than
550 communities in Illinois, Massachusetts and Ohio.

Safety

Dynegy's safety performance has reached the top decile for the industry.
Both coal and gas facilities are focused on intensive safety initiatives
helping to drive safety culture: second quarter 2017 saw safety
performance improved with 40% fewer injuries overall compared to 2016.
Dynegy expects that all its plants will complete the Voluntary
Protection Program (VPP) certification, a rigorous evaluation process
conducted by the Occupational Safety and Health Administration, within
the next three years. The Lake Road plant received its VPP certification
renewal during the second quarter.

Asset Portfolio Updates

PJM and ISO-NE Asset Sales

On July 10, Dynegy reached agreements to sell three generating assets
for approximately $300 million.

Lee Energy Facility, a 625 MW (summer capacity rating) gas-fueled
peaking asset in the PJM ComEd region will be sold to an affiliate of
Rockland Capital for $180 million in cash, and the sale will enable the
company to avoid significant incremental capital investments necessary
to convert the plant to dual fuel status in order to meet PJM capacity
performance obligations.

Dynegy also signed a purchase and sale agreement with Starwood Energy
Group Global to sell two intermediate gas-fueled plants located in
Dighton and Milford, Massachusetts for $119 million in cash. The Dighton
and Milford sale fulfills the mitigation plan approved by the Federal
Energy Regulatory Commission (FERC) regarding the Company's purchase of
ENGIE's US-based asset portfolio.

On July 11, Dynegy completed the sale of two peaking units, Troy and
Armstrong Energy Facilities, and received approximately $480 million in
cash proceeds.

In total, these asset sales will provide approximately $780 million in
proceeds which will be used for debt reduction.

AEP Conesville/Zimmer Transaction Complete

On May 9, Dynegy finalized the sale of its 40% ownership interest (312
MW) in Conesville Power Station to AEP and acquired AEP's 25.4%
ownership interest (330 MW) in Zimmer Power Station. No cash was
exchanged, no additional debt incurred and AEP returned $58 million in
letters of credit previously posted by Dynegy.

As a result, Dynegy owns 71.9% (971 MW) and continues to operate Zimmer.
Dynegy no longer has an ownership interest in the AEP-operated
Conesville.

AES Miami Fort/Zimmer Ownership Consolidation Update

On April 21, Dynegy reached agreement to purchase AES' 28.1% ownership
interest in Zimmer and 36% in Miami Fort stations, totaling
approximately 740 MW of generating capacity, for $50 million, subject to
certain adjustments. The transaction close is pending FERC approval,
anticipated to come by year end.

Uprate Program Developments

We completed 43 MW of low-cost uprates at Liberty and Milford (CT)
averaging $175/kW, bringing our uprate total to 702 MW over the past
three years.

PRIDE and ENGIE Synergies Update

Dynegy's PRIDE Energized (Producing Results through Innovation by Dynegy
Employees) program is on track to meet or exceed its 2017 target of $65
million in EBITDA by the end of the fourth quarter. Through its PRIDE
program, Dynegy has already exceeded its three-year goal of $400 million
in balance sheet improvements with $422 million in improvements
accomplished in 2016. Dynegy has identified more than $100 million of
incremental balance sheet opportunities that will result in more than
$500 million in PRIDE improvements secured over the course of 2016 and
2017.

Dynegy has completed the ENGIE integration and achieved the expected
$120 million in synergies. Any future opportunities related to the ENGIE
assets will be incorporated in the PRIDE program for which we expect to
provide enhanced targets later this year.

Investor Conference Call/Webcast

Dynegy's earnings presentation and management comments on the earnings
presentation will be available on the "Investor Relations" section of www.dynegy.com
later today. The Company will answer questions about its 2017 second
quarter financial results during an investor conference call and webcast
tomorrow, August 4, 2017 at 9 am ET/8 am CT. Participants may access the
webcast from the Company's website.

About Dynegy

At Dynegy, we generate more than just power for our customers. We are
committed to being a leader in the electricity sector. Throughout the
Northeast, Mid-Atlantic, Midwest and Texas, Dynegy operates power
generating facilities capable of producing more than 28,000 megawatts of
electricity—or enough energy to power about 22 million American homes.
We're proud of what we do, but it's about much more than just output.
We're always striving to generate power safely and responsibly for our
wholesale and retail electricity customers who depend on that energy to
grow and thrive.

Forward-Looking Statement

This news release contains statements reflecting assumptions,
expectations, projections, intentions or beliefs about future events
that are intended as "forward-looking statements," particularly those
statements concerning Dynegy's beliefs and expectations regarding sale
of the Lee, Dighton and Milford (MA) facilities; execution of its PRIDE
Energized target in balance sheet and operating improvements, including
beliefs regarding the next generation of PRIDE; broadening the retail
platform; achievement of OSHAs VPP certification within the next three
years; the execution and timing of debt repayments and various
delevering strategies; anticipated FERC approval, closing and ownership
consolidation of Zimmer and Miami Fort units; anticipated earnings and
cash flows and Dynegy's 2017 Adjusted EBITDA and Adjusted Free Cash Flow
guidance. Historically, Dynegy's performance has deviated, in some cases
materially, from its cash flow and earnings guidance. Discussion of
risks and uncertainties that could cause actual results to differ
materially from current projections, forecasts, estimates and
expectations of Dynegy is contained in Dynegy's filings with the
Securities and Exchange Commission (the SEC). Specifically, Dynegy makes
reference to, and incorporates herein by reference, the section entitled
"Risk Factors" in its 2016 Form 10-K and subsequent Form 10-Qs. In
addition to the risks and uncertainties set forth in Dynegy's SEC
filings, the forward-looking statements described in this press release
could be affected by, among other things, (i) beliefs and assumptions
about weather and general economic conditions; (ii) beliefs,
assumptions, and projections regarding the demand for power, generation
volumes, and commodity pricing, including natural gas prices and the
timing of a recovery in power market prices, if any; (iii) beliefs and
assumptions about market competition, generation capacity, and regional
supply and demand characteristics of the wholesale and retail power
markets, including the anticipation of plant retirements and higher
market pricing over the longer term; (iv) sufficiency of, access to, and
costs associated with coal, fuel oil, and natural gas inventories and
transportation thereof; (v) the effects of, or changes to the power and
capacity procurement processes in the markets in which we operate; (vi)
expectations regarding, or impacts of, environmental matters, including
costs of compliance, availability and adequacy of emission credits, and
the impact of ongoing proceedings and potential regulations or changes
to current regulations, including those relating to climate change, air
emissions, cooling water intake structures, coal combustion byproducts,
and other laws and regulations that we are, or could become, subject to,
which could increase our costs, result in an impairment of our assets,
cause us to limit or terminate the operation of certain of our
facilities, or otherwise have a negative financial effect; (vii) beliefs
about the outcome of legal, administrative, legislative, and regulatory
matters, including any impacts from the change in administration to
these matters; (viii) projected operating or financial results,
including anticipated cash flows from operations, revenues, and
profitability; (ix) our focus on safety and our ability to operate our
assets efficiently so as to capture revenue generating opportunities and
operating margins; (x) our ability to mitigate forced outage risk,
including managing risk associated with CP in PJM and performance
incentives in ISO-NE; (xi) our ability to optimize our assets through
targeted investment in cost effective technology enhancements; (xii) the
effectiveness of our strategies to capture opportunities presented by
changes in commodity prices and to manage our exposure to energy price
volatility; (xiii) efforts to secure retail sales and the ability to
grow the retail business; (xiv) efforts to identify opportunities to
reduce congestion and improve busbar power prices; (xv) ability to
mitigate impacts associated with expiring reliability must run "RMR"
and/or capacity contracts; (xvi) expectations regarding our compliance
with the Credit Agreement, including collateral demands, interest
expense, any applicable financial ratios, and other payments; (xvii)
expectations regarding performance standards and capital and maintenance
expenditures; (xviii) the timing and anticipated benefits to be achieved
through our Company-wide improvement programs, including our PRIDE
initiative; (xix) expectations regarding strengthening the balance
sheet, managing debt maturities and improving Dynegy's leverage profile;
(xx) expectations, timing and benefits of the AES transaction; (xxi)
efforts to divest assets and the associated timing of such divestitures,
and anticipated use of proceeds from such divestitures; (xxii)
anticipated timing, outcome and impact of expected retirements; (xxiii)
beliefs about the costs and scope of the ongoing demolition and site
remediation efforts; and (xxiv) expectations regarding the synergies,
anticipated benefits and FERC mitigation efforts resulting from the
ENGIE Acquisition. Any or all of Dynegy's forward-looking statements may
turn out to be wrong. They can be affected by inaccurate assumptions or
by known or unknown risks, uncertainties, and other factors, many of
which are beyond Dynegy's control.

       

DYNEGY INC.

REPORTED UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS

(IN MILLIONS, EXCEPT PER SHARE DATA)

 

Three Months Ended
June 30,

Six Months Ended
June 30,

2017   2016 2017   2016
Revenues $ 1,164 $ 904 $ 2,411 $ 2,027
Cost of sales, excluding depreciation expense (681 ) (493 ) (1,438 ) (1,038 )

Gross margin

483 411 973 989
Operating and maintenance expense (282 ) (256 ) (514 ) (477 )
Depreciation expense (209 ) (160 ) (409 ) (331 )
Impairments (99 ) (645 ) (119 ) (645 )
Loss on sale of assets, net (29 )

-

(29 )

-

General and administrative expense (42 ) (39 ) (82 ) (76 )
Acquisition and integration costs (7 ) 3 (52 ) (1 )
Other 3   (16 ) 1   (16 )
Operating loss (182 ) (702 ) (231 ) (557 )
Bankruptcy reorganization items (1 )

-

482

-

Earnings from unconsolidated investments 1 1

-

3
Interest expense (159 ) (141 ) (326 ) (283 )
Other income and expense, net 29   30   46   31  
Loss before income taxes (312 ) (812 ) (29 ) (806 )
Income tax benefit (expense) 16   9   329   (7 )
Net income (loss) (296 ) (803 ) 300 (813 )
Less: Net loss attributable to noncontrolling interest

-

  (2 ) (1 ) (2 )
Net income (loss) attributable to Dynegy Inc. (296 ) (801 ) 301 (811 )
Less: Dividends on preferred stock 6   6   11   11  
Net income (loss) attributable to Dynegy Inc. common stockholders $ (302 ) $ (807 ) $ 290   $ (822 )
 
Earnings (Loss) Per Share:
Basic earnings (loss) per share attributable to Dynegy Inc. common
stockholders
$ (1.96 ) $ (6.73 ) $ 1.91 $ (6.97 )
Diluted earnings (loss) per share attributable to Dynegy Inc. common
stockholders
$ (1.96 ) $ (6.73 ) $ 1.76 $ (6.97 )
 
Basic shares outstanding 154 120 152 118
Diluted shares outstanding 154 120 171 118
 

The following table reflects significant components of our weighted
average shares outstanding used in the basic and diluted loss per share
calculations for the three and six months ended June 30, 2017 and 2016:

   

Three Months Ended
June 30,

   

Six Months Ended
June 30,

(in millions) 2017   2016 2017   2016
Shares outstanding at the beginning of the period (1) 154 117 140 117
Weighted-average shares outstanding during the period of:
Shares issued under long-term compensation plans

-

-

1

-

Shares issued under the PIPE Transaction

-

-

11

-

Prepaid stock purchase contract (TEUs) (1)

-

  3  

-

  1
Basic weighted-average shares outstanding 154 120 152 118
Dilution from potentially dilutive shares (2)

-

 

-

  19  

-

Diluted weighted-average shares outstanding (3) 154   120   171   118

_________________________________________

(1)  

The minimum settlement amount of the TEUs, or 23,092,460 shares,
is considered to be outstanding since the issuance date of June
21, 2016, and is included in the computation of basic earnings
(loss) per share for the three and six months ended June 30, 2017
and 2016.

(2) Shares included in the computation of diluted earnings (loss) per
share for the six months ended June 30, 2017 primarily consist of
approximately 5.4 million shares related to our TEUs and 12.9
million shares related to our mandatory convertible preferred stock.
(3) Entities with a net loss from continuing operations are prohibited
from including potential common shares in the computation of diluted
per share amounts. Accordingly, we have utilized the basic shares
outstanding amount to calculate both basic and diluted loss per
share for the three months ended June 30, 2017 and three and six
months ended June 30, 2016.
 

DYNEGY INC.

OPERATING DATA

 

The following table provides summary financial data regarding our
PJM, NY/NE, ERCOT, MISO, IPH and CAISO segment results of
operations for the three and six months ended June 30, 2017 and
2016, respectively.

       

Three Months Ended
June 30,

Six Months Ended
June 30,

2017   2016 2017   2016
PJM
Million Megawatt Hours Generated (1) 10.9 11.2 24.3 24.2
IMA (1)(2):
Combined Cycle Facilities 87 % 98 % 88 % 98 %
Coal-Fueled Facilities 70 % 79 % 68 % 78 %
Average Capacity Factor (1)(3):
Combined Cycle Facilities 51 % 62 % 59 % 72 %
Coal-Fueled Facilities 50 % 46 % 55 % 44 %
CDDs (4) 349 331 350 334
HDDs (4) 411 589 2,636 3,038
Average Market On-Peak Spark Spreads ($/MWh) (5):
PJM West $ 15.76 $ 21.15 $ 13.57 $ 19.94
AD Hub $ 16.56 $ 27.53 $ 14.59 $ 29.68
Average Market On-Peak Power Prices ($/MWh) (6):
PJM West $ 33.24 $ 32.07 $ 32.88 $ 31.78
AD Hub $ 33.59 $ 30.43 $ 32.49 $ 29.61
Average natural gas price—TetcoM3 ($/MMBtu) (7) $ 2.50 $ 1.55 $ 2.76 $ 1.69
 
NY/NE
Million Megawatt Hours Generated (1) 4.2 3.8 8.9 7.7
IMA for Combined Cycle Facilities (1)(2) 96 % 95 % 97 % 92 %
Average Capacity Factor for Combined Cycle Facilities (1)(3) 37 % 46 % 37 % 43 %
CDDs (4) 202 150 202 150
HDDs (4) 780 839 3,552 3,558
Average Market On-Peak Spark Spreads ($/MWh) (5):
New York—Zone C $ 9.63 $ 13.73 $ 10.69 $ 13.04
Mass Hub $ 12.07 $ 11.02 $ 9.35 $ 10.92
Average Market On-Peak Power Prices ($/MWh) (6):
New York—Zone C $ 26.67 $ 24.09 $ 28.59 $ 22.71
Mass Hub $ 32.19 $ 28.17 $ 34.98 $ 31.01
Average natural gas price—Algonquin Citygates ($/MMBtu) (7) $ 2.87 $ 2.44 $ 3.66 $ 2.87
 
ERCOT
Million Megawatt Hours Generated (1) 3.2

-

3.8

-

IMA (1)(2):
Combined-Cycle Facilities 91 %

-

% 93 %

-

%
Coal-Fueled Facility 100 %

-

% 98 %

-

%
Average Capacity Factor (1)(3):
Combined-Cycle Facilities 26 %

-

% 20 %

-

%
Coal-Fueled Facility 81 %

-

% 56 %

-

%
CDDs (4) 1,070 982 1,337 1,102
HDDs (4) 17 30 511 788
Average Market On-Peak Spark Spreads ($/MWh) (5):
ERCOT North $ 7.71 $ 10.64 $ 5.91 $ 8.64
Average Market On-Peak Power Prices ($/MWh) (6):
ERCOT North $ 26.76 $ 24.29 $ 25.15 $ 21.95
Average natural gas price—Waha Hub ($/MMBtu) (7) $ 2.72 $ 1.95 $ 2.75 $ 1.90
 
MISO
Million Megawatt Hours Generated 2.7 3.6 5.4 7.0
IMA for Coal-Fueled Facilities (2) 84 % 86 % 87 % 87 %
Average Capacity Factor for Coal-Fueled Facilities (3) 65 % 59 % 65 % 54 %
CDDs (4) 420 472 476 500
HDDs (4) 459 535 2,662 2,959
Average Market On-Peak Power Prices ($/MWh) (6):
Indiana (Indy Hub) $ 35.03 $ 31.14 $ 33.84 $ 28.38
Commonwealth Edison (NI Hub) $ 33.16 $ 28.87 $ 31.71 $ 28.11
 
IPH
Million Megawatt Hours Generated 4.2 3.3 8.0 6.6
IMA for IPH Facilities (2) 88 % 91 % 87 % 89 %
Average Capacity Factor for IPH Facilities (3) 58 % 38 % 55 % 38 %
CDDs (4) 420 472 476 500
HDDs (4) 459 535 2,662 2,959
Average Market On-Peak Power Prices ($/MWh) ($/MWh) (6):
Indiana (Indy Hub) $ 35.03 $ 31.14 $ 33.84 $ 28.38
Commonwealth Edison (NI Hub) $ 33.16 $ 28.87 $ 31.71 $ 28.11
 
CAISO
Million Megawatt Hours Generated 0.2 0.8 0.5 1.4
IMA for Combined Cycle Facilities (2) 78 % 99 % 85 % 99 %
Average Capacity Factor for Combined Cycle Facilities (3) 11 % 32 % 12 % 31 %
CDDs (4) 303 284 328 328
HDDs (4) 148 122 866 715
Average Market On-Peak Spark Spreads ($/MWh) (5):
North of Path 15 (NP 15) $ 9.50 $ 10.76 $ 8.92 $ 10.74
Average natural gas price—PG&E Citygate ($/MMBtu) (7) $ 3.27 $ 2.17 $ 3.31 $ 2.18

__________________________________________

(1)   Million Megawatt Hours Generated and Average Capacity Factor include
such activity for the full month of February. IMA excludes such
activity for our period of ownership in February.
(2) IMA is an internal measurement calculation that reflects the
percentage of generation available during periods when market prices
are such that these units could be profitably dispatched. The
calculation excludes certain events outside of management control
such as weather related issues. The calculation excludes our Brayton
Point facility and CTs.
(3) Reflects actual production as a percentage of available capacity.
The calculation excludes our Brayton Point facility and CTs.
(4) Reflects CDDs or HDDs for the region based on NOAA data.
(5) Reflects the simple average of the on-peak spark spreads available
to a 7.0 MMBtu/MWh heat rate generator selling power at day-ahead
prices and buying delivered natural gas at a daily cash market price
and does not reflect spark spreads available to us.
(6) Reflects the average of day-ahead settled prices for the periods
presented and does not necessarily reflect prices we realized.
(7) Reflects the average of daily quoted prices for the periods
presented and does not reflect costs incurred by us.
 

DYNEGY INC.

REG G RECONCILIATIONS - ADJUSTED EBITDA

THREE MONTHS ENDED JUNE 30, 2017

(UNAUDITED) (IN MILLIONS)

 

The following table provides summary financial data regarding our
Adjusted EBITDA by segment for the three months ended June 30,
2017:

   
Three Months Ended June 30, 2017
PJM   NY/NE   ERCOT   MISO   IPH   CAISO   Other   Total
Net loss $ (296 )
Plus / (Less):
Income tax benefit (16 )
Other income and expense, net (29 )
Interest expense 159
Earnings from unconsolidated investments (1 )
Bankruptcy reorganization items 1  
Operating income (loss) $ 6 $ (1 ) $ (30 ) $ (98 ) $ 11 $ (19 ) $ (51 ) $ (182 )
Depreciation and amortization expense 98 59 22 7 13 14 2 215
Bankruptcy reorganization items

-

-

-

-

(1 )

-

-

(1 )
Earnings from unconsolidated investments 1

-

-

-

-

-

-

1
Other income and expense, net

-

 

-

 

-

 

-

  25  

-

  4   29  
EBITDA (1) 105 58 (8 ) (91 ) 48 (5 ) (45 ) 62
Plus / (Less):
Adjustments to reflect Adjusted EBITDA from unconsolidated
investments and exclude noncontrolling interest
(1 )

-

-

-

(1 )

-

-

(2 )
Acquisition, integration and restructuring costs

-

-

-

-

-

-

6 6
Bankruptcy reorganization items

-

-

-

-

1

-

-

1
Mark-to-market adjustments, including warrants 31 2 8 (4 )

-

4 (3 ) 38
Impairments

-

-

-

99

-

-

-

99
Loss (gain) on sale of assets 30

-

-

-

(1 )

-

-

29
Non-cash compensation expense

-

-

-

-

-

-

5 5
Other 3  

-

  1   (1 )

-

 

-

  (1 ) 2  
Adjusted EBITDA (1)(2) $ 168   $ 60   $ 1   $ 3   $ 47   $ (1 ) $ (38 ) $ 240  

__________________________________________

(1)   EBITDA and Adjusted EBITDA are non-GAAP financial measures. Please
refer to Item 2.02 of our Form 8-K filed on August 3, 2017, for
definitions, utility and uses of such non-GAAP financial measures. A
reconciliation of EBITDA to Operating income (loss) is presented
above. Management does not allocate G&A, interest expense and income
taxes on a segment level and therefore uses Operating income (loss)
as the most directly comparable GAAP measure.
(2) Not adjusted to exclude Wood River's energy margin and O&M costs.
 

DYNEGY INC.

REG G RECONCILIATIONS - ADJUSTED EBITDA

THREE MONTHS ENDED JUNE 30, 2016

(UNAUDITED) (IN MILLIONS)

 

The following table provides summary financial data regarding our
Adjusted EBITDA by segment for the three months ended June 30,
2016:

   
Three Months Ended June 30, 2016
PJM   NY/NE   ERCOT   MISO   IPH   CAISO   Other   Total
Net loss $ (803 )
Plus / (Less):

Income tax benefit

(9 )
Other income and expense, net (30 )
Interest expense 141
Earnings from unconsolidated investments (1 )
Operating income (loss) $ 71 $ (5 ) $

-

$ (729 ) $ 3 $ 4 $ (46 ) $ (702 )
Depreciation and amortization expense 84 60

-

9 3 6 2 164
Earnings from unconsolidated investments 1

-

-

-

-

-

-

1
Other income and expense, net 6  

-

 

-

 

-

  14   12   (2 ) 30  
EBITDA (1) 162 55

-

(720 ) 20 22 (46 ) (507 )
Plus / (Less):
Adjustments to reflect Adjusted EBITDA from unconsolidated
investments and exclude noncontrolling interest
1

-

-

-

2

-

-

3
Acquisition, integration and restructuring costs

-

-

-

-

(8 )

-

5 (3 )
Mark-to-market adjustments, including warrants (12 ) (21 )

-

65 (2 ) (1 )

-

29
Impairments

-

-

-

645

-

-

-

645
Non-cash compensation expense 1

-

-

-

-

-

4 5
Other (2)

-

 

-

 

-

  14   (1 )

-

  2   15  
Adjusted EBITDA (1) $ 152   $ 34   $

-

  $ 4   $ 11   $ 21   $ (35 ) $ 187  

__________________________________________

(1)   EBITDA and Adjusted EBITDA are non-GAAP financial measures. Please
refer to Item 2.02 of our Form 8-K filed on August 3, 2017, for
definitions, utility and uses of such non-GAAP financial measures. A
reconciliation of EBITDA to Operating income (loss) is presented
above. Management does not allocate G&A, interest expense and income
taxes on a segment level and therefore uses Operating income (loss)
as the most directly comparable GAAP measure.
(2) Other includes an adjustment to exclude Wood River's energy margin
and O&M costs of $15 million.
 

DYNEGY INC.

REG G RECONCILIATIONS - ADJUSTED EBITDA

SIX MONTHS ENDED JUNE 30, 2017

(UNAUDITED) (IN MILLIONS)

 

The following table provides summary financial data regarding our
Adjusted EBITDA by segment for the six months ended June 30, 2017:

   
Six Months Ended June 30, 2017
PJM   NY/NE   ERCOT   MISO   IPH   CAISO   Other   Total
Net income $ 300
Plus / (Less):
Income tax benefit (329 )
Other income and expense, net (46 )
Interest expense 326
Bankruptcy reorganization items (482 )
Operating income (loss) $ 92 $ (42 ) $ (58 ) $ (81 ) $ 29 $ (33 ) $ (138 ) $ (231 )
Depreciation and amortization expense 198 127 35 15 27 29 4 435
Bankruptcy reorganization items

-

-

-

-

482

-

-

482
Other income and expense, net

-

 

-

 

-

 

-

  26  

-

  20   46  
EBITDA (1) 290 85 (23 ) (66 ) 564 (4 ) (114 ) 732
Plus / (Less):
Adjustments to reflect Adjusted EBITDA from unconsolidated
investments and exclude noncontrolling interest

-

-

-

-

(1 )

-

-

(1 )
Acquisition, integration and restructuring costs

-

-

-

-

-

-

52 52
Bankruptcy reorganization items

-

-

-

-

(482 )

-

-

(482 )
Mark-to-market adjustments, including warrants 16 17 14 (19 ) (1 )

-

(15 ) 12
Impairments 20

-

-

99

-

-

-

119
Loss (gain) on sale of assets 30

-

-

-

(1 )

-

-

29
Non-cash compensation expense

-

-

-

-

-

-

10

10
Other 3  

-

  1   (1 ) (1 )

-

  (3 ) (1 )
Adjusted EBITDA (1)(2) $ 359   $ 102   $ (8 ) $ 13   $ 78   $ (4 ) $ (70 ) $ 470  

__________________________________________

(1)   EBITDA and Adjusted EBITDA are non-GAAP financial measures. Please
refer to Item 2.02 of our Form 8-K filed on August 3, 2017, for
definitions, utility and uses of such non-GAAP financial measures. A
reconciliation of EBITDA to Operating income (loss) is presented
above. Management does not allocate G&A, interest expense and income
taxes on a segment level and therefore uses Operating income (loss)
as the most directly comparable GAAP measure.
(2) Not adjusted to exclude Wood River's energy margin and O&M costs.
 

DYNEGY INC.

REG G RECONCILIATIONS - ADJUSTED EBITDA

SIX MONTHS ENDED JUNE 30, 2016

(UNAUDITED) (IN MILLIONS)

 

The following table provides summary financial data regarding our
Adjusted EBITDA by segment for the six months ended June 30, 2016:

   
Six Months Ended June 30, 2016
PJM   NY/NE   ERCOT   MISO   IPH   CAISO   Other   Total
Net loss $ (813 )
Plus / (Less):
Income tax expense 7
Other income and expense, net (31 )
Interest expense 283
Earnings from unconsolidated investments (3 )
Operating income (loss) $ 248 $ (7 ) $

-

$ (716 ) $ 17 $ (10 ) $ (89 ) $ (557 )
Depreciation and amortization expense 167 135

-

18 13 18 3 354
Earnings from unconsolidated investments 3

-

-

-

-

-

-

3
Other income and expense, net 6  

-

 

-

 

-

  14   12   (1 ) 31  
EBITDA (1) 424 128

-

(698 ) 44 20 (87 ) (169 )
Plus / (Less):
Adjustments to reflect Adjusted EBITDA from unconsolidated
investments and exclude noncontrolling interest
4

-

-

-

2

-

-

6
Acquisition and integration costs

-

-

-

-

(8 )

-

9 1
Bankruptcy reorganization items

-

-

-

-

-

-

-

-

Mark-to-market adjustments, including warrants (68 ) (41 )

-

37 (5 ) 1 (1 ) (77 )
Impairments

-

-

-

645

-

-

-

645
Non-cash compensation expense 1

-

-

-

-

-

11 12
Other (2)

-

 

-

 

-

  19   (1 )

-

  2   20  
Adjusted EBITDA (1) $ 361   $ 87   $

-

  $ 3   $ 32   $ 21   $ (66 ) $ 438  

__________________________________________

(1)   EBITDA and Adjusted EBITDA are non-GAAP financial measures. Please
refer to Item 2.02 of our Form 8-K filed on August 3, 2017, for
definitions, utility and uses of such non-GAAP financial measures. A
reconciliation of EBITDA to Operating income (loss) is presented
above. Management does not allocate G&A, interest expense and income
taxes on a segment level and therefore uses Operating income (loss)
as the most directly comparable GAAP measure.
(2) Other includes an adjustment to exclude Wood River's energy margin
and O&M costs of $20 million for the six months ended June 30, 2016.
 

DYNEGY INC.

REG G RECONCILIATIONS - 2017 GUIDANCE

(UNAUDITED) (IN MILLIONS)

 

The following table provides summary financial data regarding our
2017 Adjusted EBITDA and Adjusted Free Cash Flow guidance:

     
Dynegy Consolidated
Low     High
Net income (1) $ 371 $ 566
Plus / (Less):
Interest expense 645 655
Tax benefit (320 ) (330 )
Depreciation and amortization expense 815   835  
EBITDA (2) 1,511 1,726
Plus / (Less):
Acquisition, integration and restructuring costs 50 55
Bankruptcy reorganization items (480 ) (500 )
Impairments 119   119  
Adjusted EBITDA (2) $ 1,200 $ 1,400
Cash interest payments (600 ) (600 )
Acquisition, integration and restructuring costs (50 ) (55 )
Other cash items (90 ) (90 )
Cash Flow from Operations 460 655
Maintenance capital expenditures (200 ) (200 )
Environmental capital expenditures (10 ) (10 )
Acquisition, integration and restructuring costs 50   55  
Adjusted Free Cash Flow (2) $ 300   $ 500  

__________________________________________

(1)   For purposes of our 2017 guidance, fair value adjustments related to
derivatives and our common stock warrants are assumed to be zero.
(2) EBITDA, Adjusted EBITDA and Adjusted Free Cash Flow are non-GAAP
measures. Please refer to Item 2.02 of our Form 8-K filed on August
3, 2017, for definitions, utility and uses of such non-GAAP
financial measures.

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