Oct. 30, 2009 (PR Newswire) -- ST. LOUIS, Oct. 30 /PRNewswire-FirstCall/ -- Ameren Corporation (NYSE: AEE) today announced third quarter 2009 net income in accordance with generally accepted accounting principles (GAAP) of $227 million, or $1.04 per share, compared to third quarter 2008 GAAP net income of $204 million, or 97 cents per share. Excluding certain items in each year, Ameren recorded third quarter 2009 core (non-GAAP) net income of $255 million, or $1.16 per share, compared to third quarter 2008 core (non-GAAP) net income of $246 million, or $1.17 per share.

Factors favorably affecting core (non-GAAP) third quarter 2009 earnings per share, as compared to the same period in 2008, included utility rate adjustments in Illinois and Missouri, lower operations and maintenance expenses, as well as the revenue-leveling effect of natural gas rate redesign in the Illinois regulated utility segment. Offsetting factors included lower electricity sales in the regulated utilities and lower margins in the merchant generation segment, as a result of much cooler summer weather and economic conditions. Higher interest expense and increased average common shares outstanding also impacted comparative results.

"I am pleased to report that our third quarter core earnings per share were just one cent less than those of the year-ago quarter despite much cooler summer weather and the weak economy," said Thomas R. Voss, president and chief executive officer of Ameren Corporation. "Our entire management team is keenly focused on laying a foundation on which we can build and deliver shareholder value in the years to come. Key steps have been taken in this direction over the past few months, including reevaluating and reducing planned expenditures, further strengthening our financial profile and right-sizing our organization. We are also seeking to recover increased costs in our regulated businesses and positioning our merchant generation business to weather current power market conditions and benefit from an expected eventual recovery. We intend to lead the way to a secure energy future for our customers and our communities.

"With our most significant earnings' quarters behind us, we are narrowing our 2009 core earnings per share guidance to a range of $2.70 to $2.90 from our prior range of $2.70 to $3.05. Our new core guidance range reflects reduced sales due to much cooler-than-normal third quarter weather and continued weak economic conditions, as well as dilution from our third quarter common equity offering. The impact of these factors is partially offset by reduced operating and interest expenses, as compared to our prior guidance."

In the third quarter of 2009, at Ameren's regulated utilities, much cooler summer weather and the economic slowdown led to a 10% decrease in kilowatthour sales to residential customers and a 3% decrease in kilowatthour sales to commercial customers, compared to the year-ago quarter. These sales changes were more modest on a weather-normalized basis, with residential sales declining an estimated 2% and commercial sales declining an estimated 1%. Cooling degree-days in the 2009 third quarter were 18% below those of the 2008 third quarter and 23% below normal. The weak economy continued to affect kilowatthour sales by Ameren's regulated utilities to their industrial customers. These sales declined 13% from the year-ago quarter, excluding the impact of reduced sales to AmerenUE's largest customer, the Noranda Aluminum, Inc., smelter plant in New Madrid, Mo. Noranda's plant sustained damage because of a power interruption on non-Ameren-owned power lines during a severe January 2009 ice storm. Including Noranda, electric sales to industrial customers declined 18% in the third quarter of 2009, as compared to the year-ago quarter.

The following items were excluded from third quarter 2009 and third quarter 2008 core (non-GAAP) earnings, as applicable:

--  Net costs associated with the Illinois comprehensive electric rate
relief and customer assistance settlement agreement (reached in 2007)
reduced net income by $4 million in the third quarter of 2009 and by $6
million in the third quarter of 2008.
--  Net effects of mark-to-market activity decreased net income by $11
million in the third quarter of 2009 and by $36 million in the third
quarter of 2008.

--  Employee separation programs and the retirement of two generating units
at the merchant generation segment's Meredosia Power Plant reduced net
income by $13 million in the third quarter of 2009.

Net income in accordance with GAAP for the nine months ended Sept. 30, 2009, was $533 million, or $2.48 per share, compared to $548 million, or $2.61 per share, for the same period in 2008. Excluding certain items in each year, Ameren recorded nine-month 2009 core (non-GAAP) net income of $530 million, or $2.46 per share, compared to nine-month 2008 core (non-GAAP) net income of $525 million, or $2.50 per share. A reconciliation of GAAP to core (non-GAAP) earnings per share is as follows:

Third Quarter    Nine Months
-------------    -----------
2009      2008  2009      2008
----      ----  ----      ----
GAAP earnings per share                   $1.04     $0.97 $2.48     $2.61
Illinois electric rate relief
settlement, net                       0.02      0.03  0.06      0.10
Net unrealized mark-to-market
activity                              0.04      0.17 (0.14)    (0.09)
Coal contract settlement - 2009
portion                                  -         -     -     (0.08)
Accounting order for 2007 severe
storms                                   -         -     -     (0.04)
Employee separation & generating unit
retirements                           0.06         -  0.06         -
Core (non-GAAP) earnings per share        $1.16     $1.17 $2.46     $2.50

2009 Earnings Guidance

As previously mentioned, Ameren has updated its expectations for full-year 2009 earnings. GAAP earnings for 2009 are now expected to be in the range of $2.57 to $2.77 per share, compared to the prior range of $2.63 to $2.98 per share. Core (non-GAAP) earnings are now expected to be in the range of $2.70 to $2.90 per share, compared to the prior range of $2.70 to $3.05. The 2009 core (non-GAAP) earnings guidance excludes an estimated 7 cents per share negative impact from the 2007 settlement agreement among parties in Illinois to provide comprehensive electric rate relief and customer assistance and an estimated 6 cents per share negative impact from the costs of employee separation programs and generating unit retirements. Any net unrealized mark-to-market gains or losses will affect GAAP earnings, but are excluded from GAAP and core (non-GAAP) earnings guidance because the company is unable to reasonably estimate the impact of any such gains or losses.

Ameren expects its business segments to provide the following contributions to full year 2009 core (non-GAAP) earnings per share:

Missouri Regulated                             $1.05 - $1.10
Illinois Regulated                              0.50 -  0.55
Merchant Generation                             1.15 -  1.25
--------------
2009 Core (Non-GAAP) Earnings Guidance Range   $2.70 - $2.90

These estimated segment contributions have been updated to reflect the narrowed core (non-GAAP) earnings guidance.

Ameren's earnings guidance for 2009 assumes normal weather for the balance of the year and is subject to, among other things, regulatory decisions and legislative actions, plant operations, energy and capital and credit market conditions, economic conditions, severe storms, unusual or otherwise unexpected gains or losses, and other risks and uncertainties outlined, or referred to, in the Forward-looking Statements section of this press release.

Missouri Regulated Segment Earnings

Core (non-GAAP) earnings in the third quarter of 2009 were $145 million versus $141 million in the prior-year period. The earnings improvement was primarily a result of electric rates, which took effect March 1, 2009, and cost control efforts. Offsets included reduced electric sales due to much cooler summer weather, the weak economy and lower sales to the Noranda Aluminum smelter plant, as previously discussed, as well as higher financing costs. Missouri regulated operations recorded GAAP earnings in the 2009 third quarter of $141 million versus $98 million in the 2008 third quarter. In addition to the factors mentioned above, the increase in GAAP earnings was the result of a gain from net mark-to-market activity in the third quarter of 2009 as opposed to a loss in the year-ago quarter, partially offset by third quarter 2009 expenses for employee separation programs.

Illinois Regulated Segment Earnings

Core (non-GAAP) earnings in the third quarter of 2009 were $60 million as compared to $17 million in the third quarter of 2008. This earnings improvement was primarily due to electric and natural gas delivery service rates that took effect Oct. 1, 2008, lower bad debt expense, a seasonal natural gas rate redesign and cost control efforts. Effective Oct. 1, 2008, the Illinois Commerce Commission authorized a change in the way natural gas distribution costs are recovered from residential and commercial customers. This rate redesign shifts revenues from the first quarter to the second and third quarters with no expected impact on full-year earnings. These positives were partially offset by lower electric sales due to much cooler summer weather and the weak economy, higher financing costs and increased pension and benefit expenses, among other factors. Illinois regulated operations recorded GAAP earnings in the third quarter of 2009 of $57 million versus $13 million in the third quarter of 2008. In addition to the items noted above, this GAAP earnings increase resulted from the absence of a year-ago loss from net mark-to-market activity, partially offset by third quarter 2009 expenses for employee separation programs.

Merchant Generation Segment Earnings

Core (non-GAAP) earnings in the third quarter of 2009 were $62 million, down from $98 million earned in the third quarter of 2008. This decline was due to weaker power prices and higher fuel and related transportation and financing costs. Proactive forward hedges of 2009 generation, executed in prior years at higher-than-current market prices, have shielded merchant generation earnings from the full impact of falling market power prices. GAAP earnings from merchant generation operations in the third quarter of 2009 were $37 million, down from $108 million in the third quarter of 2008. In addition to the items noted above, a third quarter 2009 loss as opposed to a third quarter 2008 gain from net mark-to-market activity was the primary factor behind the decline in GAAP earnings. Third quarter 2009 charges related to employee separation programs and generating unit retirements also decreased GAAP earnings for the merchant generation segment.

Analyst Conference Call

Ameren will conduct a conference call for financial analysts at 9:00 a.m. Central Time on Friday, Oct. 30, to discuss third quarter 2009 earnings and other matters. Investors, the news media and the public may listen to a live Internet broadcast of the call at www.ameren.com by clicking on "Q3 2009 Ameren Corporation Earnings Conference Call," followed by the appropriate audio link. An accompanying slide presentation will be available on Ameren's Web site. This presentation will be posted in the "Investors" section of the Web site under "Presentations." The analyst call will also be available for replay on the Internet for one year. In addition, a telephone playback of the conference call will be available beginning at approximately noon Central Time, from Oct. 30 through Nov. 6, by dialing, U.S. (877) 660-6853 or international (201) 612-7415, and entering account number 352 and ID number 334766.

About Ameren

With assets of $24 billion, Ameren serves approximately 2.4 million electric customers and almost one million natural gas customers in a 64,000-square-mile area of Missouri and Illinois.