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State of
Incorporation
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I.R.S. Employer
Identification No.
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Delaware
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20-5653152
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601 Travis, Suite 1400
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Houston, Texas
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77002
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(Address of principal executive offices)
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(Zip Code)
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Large accelerated filer
ý
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Accelerated filer
o
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Non-accelerated filer
o
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Smaller reporting company
o
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(Do not check if a smaller reporting company)
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Page
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DEFINITIONS
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PART I. FINANCIAL INFORMATION
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Item 1.
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FINANCIAL STATEMENTS:
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Consolidated Balance Sheets:
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As of March 31, 2014 and December 31, 2013
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Consolidated Statements of Operations:
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For the three months ended March 31, 2014 and 2013
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Consolidated Statements of Comprehensive Income (Loss):
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For the three months ended March 31, 2014 and 2013
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Consolidated Statements of Cash Flows:
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For the three months ended March 31, 2014 and 2013
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Notes to Consolidated Financial Statements
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Item 2.
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MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
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Item 3.
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QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
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Item 4.
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CONTROLS AND PROCEDURES
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PART II. OTHER INFORMATION
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Item 1.
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LEGAL PROCEEDINGS
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Item 1A.
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RISK FACTORS
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Item 6.
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EXHIBITS
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Signature
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AEGC or Genco
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Ameren Energy Generating Company
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AEM
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Ameren Energy Marketing Company
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AER
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New Ameren Energy Resources, LLC
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AERG
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New AERG, LLC
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Ameren
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Ameren Corporation
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ARO
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Asset Retirement Obligation
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ASU
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Accounting Standards Update
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CAA
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Clean Air Act
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CAIR
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Clean Air Interstate Rule
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CAISO
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The California Independent System Operator
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CARB
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California Air Resources Board
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CCR
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Coal Combustion Residuals
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CEO
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Chief Executive Officer
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CFO
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Chief Financial Officer
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CFTC
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U.S. Commodity Futures Trading Commission
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CPUC
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California Public Utility Commission
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CSAPR
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Cross-State Air Pollution Rule
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CWA
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Clean Water Act
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DH
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Dynegy Holdings, LLC (formerly known as Dynegy Holdings Inc.)
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DMG
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Dynegy Midwest Generation, LLC
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DPC
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Dynegy Power, LLC
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EBITDA
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Earnings Before Interest, Taxes, Depreciation and Amortization
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EEI
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Electric Energy, Inc.
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EPA
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Environmental Protection Agency
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FASB
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Financial Accounting Standards Board
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FERC
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Federal Energy Regulatory Commission
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FTR
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Financial Transmission Rights
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GAAP
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Generally Accepted Accounting Principles of the United States of America
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GHG
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Greenhouse Gas
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GW
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Gigawatts
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IBEW
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International Brotherhood of Electrical Workers
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IMA
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In-market Asset Availability
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IPCB
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Illinois Pollution Control Board
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IPGC or Genco
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Illinois Power Generating Company (formerly known as Ameren Energy Generating Company)
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IPH
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Illinois Power Holdings, LLC
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IPM
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Illinois Power Marketing Company (formerly known as Ameren Energy Marketing Company)
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IPR
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Illinois Power Resources, LLC (formerly known as New Ameren Energy Resources, LLC)
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IPRG
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Illinois Power Resources Generating, LLC (formerly known as New AERG, LLC)
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ISO
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Independent System Operator
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ISO-NE
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Independent System Operator New England
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kW
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Kilowatt
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LC
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Letter of Credit
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LGE
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Louisville Gas and Electric Company
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LIBOR
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London Interbank Offered Rate
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LMP
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Locational Marginal Pricing
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LOLE
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Loss of Load Expectation
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LPG
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Liquefied Petroleum Gas
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LRZ
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Local Resource Zones
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LSE
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Load Serving Entity
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LTPP
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Long-Term Procurement Plan
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MISO
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Midcontinent Independent System Operator, Inc.
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MMBtu
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One Million British Thermal Units
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Moody’s
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Moody’s Investors Service Inc.
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MW
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Megawatts
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MWh
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Megawatt Hour
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NAAQS
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National Ambient Air Quality Standards
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NM
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Not Meaningful
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NOL
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Net operating loss
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NSPS
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New Source Performance Standards
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NSR
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New Source Review
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NYISO
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New York Independent System Operator
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OCI
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Other Comprehensive Income
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PG&E
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Pacific Gas and Electric Company
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PJM
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PJM Interconnection, LLC
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PRIDE
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Producing Results through Innovation by Dynegy Employees
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PSD
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Prevention of Significant Deterioration
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RGGI
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Regional Greenhouse Gas Initiative
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RMR
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Reliability Must Run
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RPM
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Reliability Pricing Model
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RTO
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Regional Transmission Organization
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SACCWIS
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Statewide Advisory Committee on Cooling Water Intake Structures
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S&P
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Standard & Poor’s Ratings Services
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SCE
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Southern California Edison
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SEC
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U.S. Securities and Exchange Commission
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SO
2
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Sulfur Dioxide
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SPDES
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State Pollutant Discharge Elimination System
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TVA
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Tennessee Valley Authority
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VaR
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Value at Risk
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March 31, 2014
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December 31, 2013
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||||
ASSETS
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Current Assets
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Cash and cash equivalents
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$
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996
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$
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843
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Accounts receivable, net of allowance for doubtful accounts of $1 and zero, respectively
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409
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420
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Inventory
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181
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181
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Assets from risk management activities
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18
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25
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Intangible assets
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86
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108
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Prepayments and other current assets
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147
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108
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Total Current Assets
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1,837
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1,685
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Property, Plant and Equipment
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3,532
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3,527
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Accumulated depreciation
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(270
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)
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(212
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)
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Property, Plant and Equipment, Net
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3,262
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3,315
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Other Assets
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Assets from risk management activities
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4
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11
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Intangible assets
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61
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68
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Deferred income taxes
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79
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100
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Other long-term assets
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109
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112
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Total Assets
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$
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5,352
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$
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5,291
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March 31, 2014
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December 31, 2013
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||||
LIABILITIES AND STOCKHOLDERS’ EQUITY
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Current Liabilities
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Accounts payable
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$
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370
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$
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329
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Accrued interest
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35
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13
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Deferred income taxes
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79
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100
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Intangible liabilities
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60
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62
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Accrued liabilities and other current liabilities
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138
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139
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Liabilities from risk management activities
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109
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65
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Debt, current portion
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36
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13
|
|
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Total Current Liabilities
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827
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721
|
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Debt, long-term portion
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1,970
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1,979
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Other Liabilities
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Liabilities from risk management activities
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28
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33
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Asset retirement obligations
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179
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173
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Other long-term liabilities
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178
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178
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|
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Total Liabilities
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3,182
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|
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3,084
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Commitments and Contingencies (Note 10)
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||||
Stockholders’ Equity
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||||
Common Stock, $0.01 par value, 420,000,000 shares authorized at March 31, 2014 and December 31, 2013; 100,313,945 shares and 100,202,036 shares issued and outstanding at March 31, 2014 and December 31, 2013, respectively
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|
1
|
|
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1
|
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Additional paid-in capital
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2,618
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2,614
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Accumulated other comprehensive income, net of tax
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55
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|
|
58
|
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Accumulated deficit
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(504
|
)
|
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(463
|
)
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Total Dynegy Stockholders’ Equity
|
|
2,170
|
|
|
2,210
|
|
||
Noncontrolling interest
|
|
—
|
|
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(3
|
)
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||
Total Equity
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2,170
|
|
|
2,207
|
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||
Total Liabilities and Equity
|
|
$
|
5,352
|
|
|
$
|
5,291
|
|
|
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Three Months Ended March 31, 2014
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|
Three Months Ended March 31, 2013
|
||||
Revenues
|
|
$
|
762
|
|
|
$
|
318
|
|
Cost of sales, excluding depreciation expense
|
|
(552
|
)
|
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(284
|
)
|
||
Gross margin
|
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210
|
|
|
34
|
|
||
Operating and maintenance expense
|
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(110
|
)
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(71
|
)
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||
Depreciation expense
|
|
(67
|
)
|
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(54
|
)
|
||
Gain on sale of assets
|
|
—
|
|
|
1
|
|
||
General and administrative expense
|
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(26
|
)
|
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(22
|
)
|
||
Acquisition and integration costs
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(6
|
)
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(3
|
)
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||
Operating income (loss)
|
|
1
|
|
|
(115
|
)
|
||
Interest expense
|
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(30
|
)
|
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(28
|
)
|
||
Other income and expense, net
|
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(6
|
)
|
|
1
|
|
||
Loss before income taxes
|
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(35
|
)
|
|
(142
|
)
|
||
Income tax expense
|
|
(2
|
)
|
|
—
|
|
||
Net loss
|
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(37
|
)
|
|
(142
|
)
|
||
Less: Net income attributable to noncontrolling interests
|
|
4
|
|
|
—
|
|
||
Net loss attributable to Dynegy Inc.
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|
$
|
(41
|
)
|
|
$
|
(142
|
)
|
|
|
|
|
|
||||
Loss Per Share (Note 14):
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|
|
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|
||||
Basic loss per share attributable to Dynegy Inc.
|
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$
|
(0.41
|
)
|
|
$
|
(1.42
|
)
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Diluted loss per share attributable to Dynegy Inc.
|
|
$
|
(0.41
|
)
|
|
$
|
(1.42
|
)
|
|
|
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|
|
||||
Basic shares outstanding
|
|
100
|
|
|
100
|
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||
Diluted shares outstanding
|
|
101
|
|
|
100
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|
|
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Three Months Ended March 31, 2014
|
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Three Months Ended March 31, 2013
|
||||
Net loss
|
|
$
|
(37
|
)
|
|
$
|
(142
|
)
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Other comprehensive loss before reclassifications:
|
|
|
|
|
||||
Actuarial loss (net of tax of zero and zero, respectively)
|
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(3
|
)
|
|
—
|
|
||
Amounts reclassified from accumulated other comprehensive income (loss):
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|
|
|
|
||||
Amortization of unrecognized prior service cost and actuarial loss, net of tax of zero and zero, respectively)
|
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(1
|
)
|
|
—
|
|
||
Other comprehensive loss, net of tax
|
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(4
|
)
|
|
—
|
|
||
Comprehensive loss
|
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(41
|
)
|
|
(142
|
)
|
||
Less: Comprehensive income attributable to noncontrolling interests
|
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3
|
|
|
—
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|
||
Total comprehensive loss attributable to Dynegy Inc.
|
|
$
|
(44
|
)
|
|
$
|
(142
|
)
|
|
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Three Months Ended March 31, 2014
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Three Months Ended March 31, 2013
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||||
CASH FLOWS FROM OPERATING ACTIVITIES:
|
|
|
|
|
|
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Net loss
|
|
$
|
(37
|
)
|
|
$
|
(142
|
)
|
Adjustments to reconcile net loss to net cash flows from operating activities:
|
|
|
|
|
||||
Depreciation expense
|
|
67
|
|
|
54
|
|
||
Non-cash interest expense (benefit)
|
|
5
|
|
|
(4
|
)
|
||
Amortization of intangibles
|
|
16
|
|
|
63
|
|
||
Risk-management activities
|
|
52
|
|
|
38
|
|
||
Gain on sale of assets
|
|
—
|
|
|
(1
|
)
|
||
Deferred income taxes
|
|
2
|
|
|
—
|
|
||
Change in value of common stock warrants
|
|
6
|
|
|
—
|
|
||
Other
|
|
9
|
|
|
5
|
|
||
Changes in working capital:
|
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|
|
|
||||
Accounts receivable, net
|
|
23
|
|
|
22
|
|
||
Inventory
|
|
—
|
|
|
8
|
|
||
Prepayments and other current assets
|
|
(31
|
)
|
|
(18
|
)
|
||
Accounts payable and accrued liabilities
|
|
55
|
|
|
(26
|
)
|
||
Affiliate transactions
|
|
—
|
|
|
(1
|
)
|
||
Changes in non-current assets
|
|
(2
|
)
|
|
(4
|
)
|
||
Changes in non-current liabilities
|
|
1
|
|
|
(1
|
)
|
||
Net cash provided by (used in) operating activities
|
|
166
|
|
|
(7
|
)
|
||
CASH FLOWS FROM INVESTING ACTIVITIES:
|
|
|
|
|
|
|
||
Capital expenditures
|
|
(17
|
)
|
|
(20
|
)
|
||
Decrease in restricted cash
|
|
—
|
|
|
13
|
|
||
Other investing
|
|
—
|
|
|
1
|
|
||
Net cash used in investing activities
|
|
(17
|
)
|
|
(6
|
)
|
||
CASH FLOWS FROM FINANCING ACTIVITIES:
|
|
|
|
|
|
|
||
Proceeds from long-term borrowings, net of financing costs
|
|
11
|
|
|
(3
|
)
|
||
Repayments of borrowings, including debt extinguishment costs
|
|
(2
|
)
|
|
(28
|
)
|
||
Interest rate swap settlement payments
|
|
(4
|
)
|
|
—
|
|
||
Other financing
|
|
(1
|
)
|
|
—
|
|
||
Net cash provided by (used in) financing activities
|
|
4
|
|
|
(31
|
)
|
||
Net increase (decrease) in cash and cash equivalents
|
|
153
|
|
|
(44
|
)
|
||
Cash and cash equivalents, beginning of period
|
|
843
|
|
|
348
|
|
||
Cash and cash equivalents, end of period
|
|
$
|
996
|
|
|
$
|
304
|
|
(amounts in millions)
|
|
Three Months Ended March 31, 2013
|
||
Revenues
|
|
$
|
595
|
|
Net loss
|
|
$
|
(153
|
)
|
Net loss attributable to noncontrolling interests
|
|
$
|
(1
|
)
|
Net loss attributable to Dynegy Inc.
|
|
$
|
(152
|
)
|
Contract Type
|
|
Hedge Designation
|
|
Quantity
|
|
Unit of Measure
|
|
Fair Value (1)
|
|||
(dollars and quantities in millions)
|
|
|
|
Purchases (Sales)
|
|
|
|
Asset (Liability)
|
|||
Commodity contracts:
|
|
|
|
|
|
|
|
|
|
|
|
Electricity derivatives (2)
|
|
Not designated
|
|
(22
|
)
|
|
MWh
|
|
$
|
(78
|
)
|
Natural gas derivatives (2)
|
|
Not designated
|
|
110
|
|
|
MMBtu
|
|
$
|
5
|
|
Diesel fuel
|
|
Not designated
|
|
13
|
|
|
Gallons
|
|
$
|
—
|
|
Coal derivatives
|
|
Not designated
|
|
1
|
|
|
Metric Ton
|
|
$
|
(3
|
)
|
Heat rate derivatives
|
|
Not designated
|
|
—
|
|
|
MWh/MMBtu
|
|
$
|
(1
|
)
|
Emissions derivatives
|
|
Not designated
|
|
3
|
|
|
Metric Ton
|
|
$
|
(1
|
)
|
Interest rate swaps
|
|
Not designated
|
|
796
|
|
|
Dollars
|
|
$
|
(40
|
)
|
Common stock warrants
|
|
Not designated
|
|
16
|
|
|
Warrant
|
|
$
|
(27
|
)
|
(1)
|
Includes both asset and liability risk management positions, but excludes margin and collateral netting, as discussed below.
|
(2)
|
Mainly comprised of swaps, options and physical forwards. Electricity derivatives also include FTRs.
|
|
|
|
|
|
March 31, 2014
|
||||||||||||||
|
|
|
|
|
|
|
Gross amounts offset in the balance sheet
|
|
|
||||||||||
Contract Type
|
|
Balance Sheet Location
|
|
Gross Fair Value
|
|
Contract Netting
|
|
Collateral or Margin Received or Paid
|
|
Net Fair Value
|
|||||||||
(amounts in millions)
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Derivative assets:
|
|
|
|
|
|
|
|
|
|
|
|||||||||
|
Commodity contracts
|
|
Assets from risk management activities
|
|
$
|
127
|
|
|
$
|
(105
|
)
|
|
$
|
—
|
|
|
$
|
22
|
|
|
Total derivative assets
|
|
|
|
$
|
127
|
|
|
$
|
(105
|
)
|
|
$
|
—
|
|
|
$
|
22
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Derivative liabilities:
|
|
|
|
|
|
|
|
|
|
|
|||||||||
|
Commodity contracts
|
|
Liabilities from risk management activities
|
|
$
|
(205
|
)
|
|
$
|
105
|
|
|
$
|
3
|
|
|
$
|
(97
|
)
|
|
Interest rate contracts
|
|
Liabilities from risk management activities
|
|
(40
|
)
|
|
—
|
|
|
—
|
|
|
(40
|
)
|
||||
|
Common stock warrants
|
|
Other long-term liabilities
|
|
(27
|
)
|
|
—
|
|
|
—
|
|
|
(27
|
)
|
||||
|
Total derivative liabilities
|
|
|
|
$
|
(272
|
)
|
|
$
|
105
|
|
|
$
|
3
|
|
|
$
|
(164
|
)
|
Total derivatives
|
|
|
|
$
|
(145
|
)
|
|
$
|
—
|
|
|
$
|
3
|
|
|
$
|
(142
|
)
|
|
|
|
|
|
December 31, 2013
|
||||||||||||||
|
|
|
|
|
|
|
Gross amounts offset in the balance sheet
|
|
|
||||||||||
Contract Type
|
|
Balance Sheet Location
|
|
Gross Fair Value
|
|
Contract Netting
|
|
Collateral or Margin Received or Paid
|
|
Net Fair Value
|
|||||||||
(amounts in millions)
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Derivative assets:
|
|
|
|
|
|
|
|
|
|
|
|||||||||
|
Commodity contracts
|
|
Assets from risk management activities
|
|
$
|
103
|
|
|
$
|
(67
|
)
|
|
$
|
—
|
|
|
$
|
36
|
|
|
Total derivative assets
|
|
|
|
$
|
103
|
|
|
$
|
(67
|
)
|
|
$
|
—
|
|
|
$
|
36
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Derivative liabilities:
|
|
|
|
|
|
|
|
|
|
|
|||||||||
|
Commodity contracts
|
|
Liabilities from risk management activities
|
|
$
|
(122
|
)
|
|
$
|
67
|
|
|
$
|
4
|
|
|
$
|
(51
|
)
|
|
Interest rate contracts
|
|
Liabilities from risk management activities
|
|
(47
|
)
|
|
—
|
|
|
—
|
|
|
(47
|
)
|
||||
|
Common stock warrants
|
|
Other long-term liabilities
|
|
(21
|
)
|
|
—
|
|
|
—
|
|
|
(21
|
)
|
||||
|
Total derivative liabilities
|
|
|
|
$
|
(190
|
)
|
|
$
|
67
|
|
|
$
|
4
|
|
|
$
|
(119
|
)
|
Total derivatives
|
|
|
|
$
|
(87
|
)
|
|
$
|
—
|
|
|
$
|
4
|
|
|
$
|
(83
|
)
|
Location on balance sheet
|
|
March 31, 2014
|
|
December 31, 2013
|
||||||||||||
Collateral posted
|
|
Amount applied against short-term risk management liabilities
|
Collateral posted
|
|
Amount applied against short-term risk management liabilities
|
|||||||||||
(amounts in millions)
|
|
|
|
|
|
|
|
|
||||||||
Prepayments and other current assets
|
|
$
|
76
|
|
|
$
|
3
|
|
|
$
|
47
|
|
|
$
|
4
|
|
Derivatives Not Designated
as Hedges
|
|
Location of Mark-to-market Gain (Loss) in Income on Derivatives
|
|
Three Months Ended March 31,
|
||||||
|
|
2014
|
|
2013
|
||||||
(amounts in millions)
|
|
|
|
|
|
|
||||
Commodity contracts
|
|
Revenues
|
|
$
|
(60
|
)
|
|
$
|
(38
|
)
|
Interest rate contracts
|
|
Interest expense
|
|
$
|
7
|
|
|
$
|
—
|
|
Common stock warrants
|
|
Other income (expense), net
|
|
$
|
(6
|
)
|
|
$
|
—
|
|
Derivatives Not Designated
as Hedges
|
|
Location of Gain (Loss)
Recognized in Income on
Derivatives
|
|
Three Months Ended March 31,
|
||||||
|
|
2014
|
|
2013
|
||||||
(amounts in millions)
|
|
|
|
|
|
|
||||
Commodity contracts
|
|
Revenues
|
|
$
|
(173
|
)
|
|
$
|
(34
|
)
|
Commodity contracts, affiliates
|
|
Revenues
|
|
$
|
—
|
|
|
$
|
(2
|
)
|
Interest rate contracts
|
|
Interest expense
|
|
$
|
3
|
|
|
$
|
—
|
|
Common stock warrants
|
|
Other income (expense), net
|
|
$
|
(6
|
)
|
|
$
|
—
|
|
|
|
Fair Value as of March 31, 2014
|
||||||||||||||
(amounts in millions)
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Assets from commodity risk management activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Electricity derivatives
|
|
$
|
—
|
|
|
$
|
46
|
|
|
$
|
58
|
|
|
$
|
104
|
|
Natural gas derivatives
|
|
—
|
|
|
23
|
|
|
—
|
|
|
23
|
|
||||
Total assets from commodity risk management activities
|
|
$
|
—
|
|
|
$
|
69
|
|
|
$
|
58
|
|
|
$
|
127
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
.
|
|
||||
Liabilities from commodity risk management activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Electricity derivatives
|
|
$
|
—
|
|
|
$
|
(114
|
)
|
|
$
|
(68
|
)
|
|
$
|
(182
|
)
|
Natural gas derivatives
|
|
—
|
|
|
(18
|
)
|
|
—
|
|
|
(18
|
)
|
||||
Heat rate derivatives
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
(1
|
)
|
||||
Emissions derivatives
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
(1
|
)
|
||||
Coal derivatives
|
|
—
|
|
|
(3
|
)
|
|
—
|
|
|
(3
|
)
|
||||
Total liabilities from commodity risk management activities
|
|
—
|
|
|
(136
|
)
|
|
(69
|
)
|
|
(205
|
)
|
||||
Liabilities from interest rate contracts
|
|
—
|
|
|
(40
|
)
|
|
—
|
|
|
(40
|
)
|
||||
Liabilities from outstanding common stock warrants
|
|
(27
|
)
|
|
—
|
|
|
—
|
|
|
(27
|
)
|
||||
Total liabilities
|
|
$
|
(27
|
)
|
|
$
|
(176
|
)
|
|
$
|
(69
|
)
|
|
$
|
(272
|
)
|
|
|
Fair Value as of December 31, 2013
|
||||||||||||||
(amounts in millions)
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Assets from commodity risk management activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Electricity derivatives
|
|
$
|
—
|
|
|
$
|
44
|
|
|
$
|
50
|
|
|
$
|
94
|
|
Natural gas derivatives
|
|
—
|
|
|
9
|
|
|
—
|
|
|
9
|
|
||||
Total assets from commodity risk management activities
|
|
$
|
—
|
|
|
$
|
53
|
|
|
$
|
50
|
|
|
$
|
103
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Liabilities from commodity risk management activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Electricity derivatives
|
|
$
|
—
|
|
|
$
|
(55
|
)
|
|
$
|
(39
|
)
|
|
$
|
(94
|
)
|
Natural gas derivatives
|
|
—
|
|
|
(21
|
)
|
|
—
|
|
|
(21
|
)
|
||||
Heat rate derivatives
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
(1
|
)
|
||||
Emissions derivatives
|
|
—
|
|
|
(2
|
)
|
|
—
|
|
|
(2
|
)
|
||||
Coal derivatives
|
|
—
|
|
|
(4
|
)
|
|
—
|
|
|
(4
|
)
|
||||
Total liabilities from commodity risk management activities
|
|
—
|
|
|
(82
|
)
|
|
(40
|
)
|
|
(122
|
)
|
||||
Liabilities from interest rate contracts
|
|
—
|
|
|
(47
|
)
|
|
—
|
|
|
(47
|
)
|
||||
Liabilities from outstanding common stock warrants
|
|
(21
|
)
|
|
—
|
|
|
—
|
|
|
(21
|
)
|
||||
Total liabilities
|
|
$
|
(21
|
)
|
|
$
|
(129
|
)
|
|
$
|
(40
|
)
|
|
$
|
(190
|
)
|
Transaction Type
|
|
Quantity
|
|
Unit of Measure
|
|
Net Fair Value
|
|
Valuation Technique
|
|
Significant Unobservable Inputs
|
|
Significant Unobservable Inputs Range
|
|||
(dollars in millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Electricity derivatives:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Forward contracts—power (1)
|
|
(8
|
)
|
|
Million MWh
|
|
$
|
(17
|
)
|
|
Basis spread + liquid location
|
|
Basis spread
|
|
$7.00-$9.00
|
FTRs
|
|
5
|
|
|
Million MWh
|
|
$
|
7
|
|
|
Historical congestion
|
|
Forward price
|
|
$0.00-$10.00
|
Diesel fuel
|
|
4
|
|
|
Million Gallons
|
|
$
|
—
|
|
|
Forward prices
|
|
Forward price
|
|
$2.65-$2.80
|
Heat rate derivatives
|
|
180
|
|
|
Thousand Tons
|
|
$
|
(1
|
)
|
|
Option models
|
|
Coal/power price correlation
|
|
0%-17%
|
|
(316
|
)
|
|
Thousand MWh
|
|
$
|
—
|
|
|
|
Power price volatility
|
|
24%-44%
|
(1)
|
Represents forward financial and physical transactions at illiquid pricing locations.
|
|
|
Three Months Ended March 31, 2014
|
||||||||||
(amounts in millions)
|
|
Electricity
Derivatives
|
|
Heat Rate Derivatives
|
|
Total
|
||||||
Balance at December 31, 2013
|
|
$
|
11
|
|
|
$
|
(1
|
)
|
|
$
|
10
|
|
Total losses included in earnings
|
|
(23
|
)
|
|
—
|
|
|
(23
|
)
|
|||
Settlements (1)
|
|
2
|
|
|
—
|
|
|
2
|
|
|||
Balance at March 31, 2014
|
|
$
|
(10
|
)
|
|
$
|
(1
|
)
|
|
$
|
(11
|
)
|
Mark-to-market losses relating to instruments held as of March 31, 2014
|
|
$
|
(23
|
)
|
|
$
|
—
|
|
|
$
|
(23
|
)
|
|
|
Three Months Ended March 31, 2013
|
||||||||||
(amounts in millions)
|
|
Electricity
Derivatives
|
|
Heat Rate Derivatives
|
|
Total
|
||||||
Balance at December 31, 2012
|
|
$
|
5
|
|
|
$
|
2
|
|
|
$
|
7
|
|
Total gains included in earnings
|
|
—
|
|
|
1
|
|
|
1
|
|
|||
Settlements (1)
|
|
(5
|
)
|
|
—
|
|
|
(5
|
)
|
|||
Balance at March 31, 2013
|
|
$
|
—
|
|
|
$
|
3
|
|
|
$
|
3
|
|
Mark-to-market gains relating to instruments held as of March 31, 2013
|
|
$
|
—
|
|
|
$
|
1
|
|
|
$
|
1
|
|
(1)
|
For purposes of these tables, we define settlements as the beginning of period fair value of contracts that settled during the period.
|
|
|
March 31, 2014
|
|
December 31, 2013
|
||||||||||||
(amounts in millions)
|
|
Carrying
Amount
|
|
Fair
Value
|
|
Carrying
Amount
|
|
Fair
Value
|
||||||||
Dynegy Inc.:
|
|
|
|
|
|
|
|
|
||||||||
Tranche B-2 Term Loan, due 2020 (1)(2)
|
|
$
|
(790
|
)
|
|
$
|
(797
|
)
|
|
$
|
(792
|
)
|
|
$
|
(802
|
)
|
5.875% Senior Notes, due 2023 (2)
|
|
$
|
(500
|
)
|
|
$
|
(490
|
)
|
|
$
|
(500
|
)
|
|
$
|
(468
|
)
|
Emissions Repurchase Agreements (2)
|
|
$
|
(29
|
)
|
|
$
|
(36
|
)
|
|
$
|
(17
|
)
|
|
$
|
(17
|
)
|
Interest rate derivatives not designated as accounting hedges (2)
|
|
$
|
(40
|
)
|
|
$
|
(40
|
)
|
|
$
|
(47
|
)
|
|
$
|
(47
|
)
|
Commodity-based derivative contracts not designated as accounting hedges (3)
|
|
$
|
(78
|
)
|
|
$
|
(78
|
)
|
|
$
|
(19
|
)
|
|
$
|
(19
|
)
|
Common stock warrants (4)
|
|
$
|
(27
|
)
|
|
$
|
(27
|
)
|
|
$
|
(21
|
)
|
|
$
|
(21
|
)
|
Genco:
|
|
|
|
|
|
|
|
|
||||||||
7.95% Senior Notes Series F, due 2032 (2)(5)
|
|
$
|
(223
|
)
|
|
$
|
(223
|
)
|
|
$
|
(224
|
)
|
|
$
|
(216
|
)
|
7.00% Senior Notes Series H, due 2018 (2)(5)
|
|
$
|
(262
|
)
|
|
$
|
(264
|
)
|
|
$
|
(259
|
)
|
|
$
|
(252
|
)
|
6.30% Senior Notes Series I, due 2020 (2)(5)
|
|
$
|
(202
|
)
|
|
$
|
(208
|
)
|
|
$
|
(200
|
)
|
|
$
|
(196
|
)
|
(1)
|
Carrying amount includes an unamortized discount of
$4 million
as of
March 31, 2014
and
December 31, 2013
. Please read
Note 9—Debt
for further discussion.
|
(2)
|
The fair values of these financial instruments are classified as Level 2 within the fair value hierarchy levels.
|
(3)
|
Carrying amount of commodity-based derivative contracts excludes
$3 million
and
$4 million
of cash posted as collateral, as of
March 31, 2014
and
December 31, 2013
, respectively.
|
(4)
|
The fair value of the common stock warrants is classified as Level 1 within the fair value hierarchy levels.
|
(5)
|
Combined carrying amounts as of
March 31, 2014
and
December 31, 2013
include unamortized discounts of
$138 million
and
$142 million
, respectively. Please read
Note 9—Debt
for further discussion.
|
|
|
Three Months Ended March 31,
|
||||||
(amounts in millions)
|
|
2014
|
|
2013
|
||||
Beginning of period
|
|
$
|
58
|
|
|
$
|
11
|
|
Current period other comprehensive loss:
|
|
|
|
|
||||
Actuarial loss (net of tax of zero and zero, respectively)
|
|
(2
|
)
|
|
—
|
|
||
Other comprehensive loss before reclassifications
|
|
(2
|
)
|
|
—
|
|
||
Amortization of unrecognized prior service cost and actuarial loss (net of tax of zero and zero, respectively) (1)
|
|
(1
|
)
|
|
—
|
|
||
Amounts reclassified from accumulated other comprehensive income
|
|
(1
|
)
|
|
—
|
|
||
Net current period other comprehensive loss
|
|
(3
|
)
|
|
—
|
|
||
End of period
|
|
$
|
55
|
|
|
$
|
11
|
|
(1)
|
Amounts are associated with our defined benefit pension and other post-employment benefit plans and are included in the computation of net periodic pension cost. Please read
Note 13—Pension and Other Post-Employment Benefit Plans
for further discussion.
|
(amounts in millions)
|
|
March 31, 2014
|
|
December 31, 2013
|
||||
Materials and supplies
|
|
$
|
80
|
|
|
$
|
81
|
|
Coal
|
|
94
|
|
|
92
|
|
||
Fuel oil
|
|
5
|
|
|
4
|
|
||
Emissions allowances (1)
|
|
2
|
|
|
4
|
|
||
Total
|
|
$
|
181
|
|
|
$
|
181
|
|
(1)
|
This inventory is held as collateral by one of our counterparties as part of a financing arrangement. Please read
Note 9—Debt
for further discussion related to the Emissions Repurchase Agreements.
|
|
|
March 31, 2014
|
|
December 31, 2013
|
||||||||||||
(amounts in millions)
|
|
Gross Carrying Amount
|
|
Accumulated Amortization
|
|
Gross Carrying Amount
|
|
Accumulated Amortization
|
||||||||
Electricity Contracts, net
|
|
$
|
330
|
|
|
$
|
(199
|
)
|
|
$
|
330
|
|
|
$
|
(170
|
)
|
Coal Contracts, net
|
|
39
|
|
|
(139
|
)
|
|
39
|
|
|
(150
|
)
|
||||
Gas Transport Contracts
|
|
(24
|
)
|
|
11
|
|
|
(24
|
)
|
|
9
|
|
||||
Total
|
|
$
|
345
|
|
|
$
|
(327
|
)
|
|
$
|
345
|
|
|
$
|
(311
|
)
|
|
|
Three Months Ended March 31,
|
||||||
(amounts in millions)
|
|
2014
|
|
2013
|
||||
Electricity Contracts, net (1)
|
|
$
|
29
|
|
|
$
|
34
|
|
Coal Contracts, net (2)
|
|
(11
|
)
|
|
31
|
|
||
Gas Transport Contracts (2)
|
|
(2
|
)
|
|
(2
|
)
|
||
Total
|
|
$
|
16
|
|
|
$
|
63
|
|
(1)
|
The amortization expense of these contracts is recognized in Revenues in our unaudited consolidated statements of operations.
|
(2)
|
The amortization expense of these contracts is recognized in Cost of sales in our unaudited consolidated statements of operations.
|
(amounts in millions)
|
|
March 31, 2014
|
|
December 31, 2013
|
||||
Dynegy Inc.:
|
|
|
|
|
||||
Tranche B-2 Term Loan, due 2020 (1)
|
|
$
|
794
|
|
|
$
|
796
|
|
5.875% Senior Notes, due 2023 (1)
|
|
500
|
|
|
500
|
|
||
Emissions Repurchase Agreements (1)
|
|
29
|
|
|
17
|
|
||
Genco:
|
|
|
|
|
||||
7.95% Senior Notes Series F, due 2032 (1)
|
|
275
|
|
|
275
|
|
||
7.00% Senior Notes Series H, due 2018 (1)
|
|
300
|
|
|
300
|
|
||
6.30% Senior Notes Series I, due 2020 (1)
|
|
250
|
|
|
250
|
|
||
|
|
2,148
|
|
|
2,138
|
|
||
Unamortized discount on debt, net
|
|
(142
|
)
|
|
(146
|
)
|
||
|
|
2,006
|
|
|
1,992
|
|
||
Less: Current maturities, including unamortized discounts, net
|
|
36
|
|
|
13
|
|
||
Total Long-term debt
|
|
$
|
1,970
|
|
|
$
|
1,979
|
|
(1)
|
Please read Note 12—Debt in our Form 10-K for further discussion.
|
|
|
Required Ratio
|
Restricted payment interest coverage ratio (1)
|
|
≥1.75
|
Additional indebtedness interest coverage ratio (2)
|
|
≥2.50
|
Additional indebtedness debt-to-capital ratio (2)
|
|
≤60%
|
(1)
|
As of the date of a restricted payment, as defined, the minimum ratio must have been achieved for the most recently ended four fiscal quarters and projected by management to be achieved for each of the subsequent four six-month periods.
|
(2)
|
Ratios must be computed on a pro forma basis considering the additional indebtedness to be incurred and the related interest expense. Other borrowings from third-party external sources are included in the definition of indebtedness and are subject to these incurrence tests.
|
|
|
Pension Benefits
|
|
Other Benefits
|
||||||||||||
|
|
Three Months Ended March 31,
|
||||||||||||||
(amounts in millions)
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
Service cost benefits earned during period
|
|
$
|
3
|
|
|
$
|
2
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Interest cost on projected benefit obligation
|
|
4
|
|
|
3
|
|
|
1
|
|
|
1
|
|
||||
Expected return on plan assets
|
|
(5
|
)
|
|
(4
|
)
|
|
(1
|
)
|
|
—
|
|
||||
Amortization of:
|
|
|
|
|
|
|
|
|
||||||||
Prior service cost
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
||||
Net periodic benefit cost (gain)
|
|
$
|
2
|
|
|
$
|
1
|
|
|
$
|
(1
|
)
|
|
$
|
1
|
|
|
|
Three Months Ended March 31,
|
||||||
(in millions, except per share amounts)
|
|
2014
|
|
2013
|
||||
Net loss
|
|
$
|
(37
|
)
|
|
$
|
(142
|
)
|
Less: Net income attributable to noncontrolling interests
|
|
4
|
|
|
—
|
|
||
Net loss attributable to Dynegy Inc. for basic and diluted loss per share
|
|
$
|
(41
|
)
|
|
$
|
(142
|
)
|
|
|
|
|
|
||||
Basic weighted-average shares
|
|
100
|
|
|
100
|
|
||
Effect of dilutive securities (1)
|
|
1
|
|
|
—
|
|
||
Diluted weighted-average shares
|
|
101
|
|
|
100
|
|
||
|
|
|
|
|
||||
Loss per share attributable to Dynegy Inc.:
|
|
|
|
|
||||
Basic
|
|
$
|
(0.41
|
)
|
|
$
|
(1.42
|
)
|
Diluted (1)
|
|
$
|
(0.41
|
)
|
|
$
|
(1.42
|
)
|
(1)
|
Entities with a net loss 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 all periods presented.
|
|
|
Three Months Ended March 31,
|
||||
(in millions of shares)
|
|
2014
|
|
2013
|
||
Stock options
|
|
1.4
|
|
|
1.0
|
|
Restricted stock units
|
|
1.2
|
|
|
0.8
|
|
Performance stock units
|
|
0.3
|
|
|
0.1
|
|
Warrants
|
|
15.6
|
|
|
15.6
|
|
Total
|
|
18.5
|
|
|
17.5
|
|
|
Parent
|
|
Guarantor Subsidiaries
|
|
Non-Guarantor Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||
Current Assets
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
$
|
570
|
|
|
$
|
158
|
|
|
$
|
268
|
|
|
$
|
—
|
|
|
$
|
996
|
|
Accounts receivable, net
|
44
|
|
|
160
|
|
|
291
|
|
|
(86
|
)
|
|
409
|
|
|||||
Intercompany receivable
|
—
|
|
|
407
|
|
|
33
|
|
|
(440
|
)
|
|
—
|
|
|||||
Inventory
|
—
|
|
|
73
|
|
|
108
|
|
|
—
|
|
|
181
|
|
|||||
Other current assets
|
8
|
|
|
140
|
|
|
105
|
|
|
(2
|
)
|
|
251
|
|
|||||
Total Current Assets
|
622
|
|
|
938
|
|
|
805
|
|
|
(528
|
)
|
|
1,837
|
|
|||||
Property, Plant and Equipment, Net
|
—
|
|
|
2,882
|
|
|
380
|
|
|
—
|
|
|
3,262
|
|
|||||
Other Assets
|
|
|
|
|
|
|
|
|
|
||||||||||
Investment in affiliates
|
6,347
|
|
|
—
|
|
|
—
|
|
|
(6,347
|
)
|
|
—
|
|
|||||
Other long-term assets
|
109
|
|
|
59
|
|
|
85
|
|
|
—
|
|
|
253
|
|
|||||
Intercompany note receivable
|
23
|
|
|
—
|
|
|
—
|
|
|
(23
|
)
|
|
—
|
|
|||||
Total Assets
|
$
|
7,101
|
|
|
$
|
3,879
|
|
|
$
|
1,270
|
|
|
$
|
(6,898
|
)
|
|
$
|
5,352
|
|
Current Liabilities
|
|
|
|
|
|
|
|
|
|
||||||||||
Accounts payable
|
$
|
—
|
|
|
$
|
163
|
|
|
$
|
293
|
|
|
$
|
(86
|
)
|
|
$
|
370
|
|
Intercompany payable
|
390
|
|
|
—
|
|
|
50
|
|
|
(440
|
)
|
|
—
|
|
|||||
Other current liabilities
|
119
|
|
|
193
|
|
|
147
|
|
|
(2
|
)
|
|
457
|
|
|||||
Total Current Liabilities
|
509
|
|
|
356
|
|
|
490
|
|
|
(528
|
)
|
|
827
|
|
|||||
Long-term debt
|
1,283
|
|
|
—
|
|
|
687
|
|
|
—
|
|
|
1,970
|
|
|||||
Intercompany interest payable
|
799
|
|
|
—
|
|
|
—
|
|
|
(799
|
)
|
|
—
|
|
|||||
Intercompany long-term debt
|
2,243
|
|
|
—
|
|
|
23
|
|
|
(2,266
|
)
|
|
—
|
|
|||||
Other long-term liabilities
|
97
|
|
|
149
|
|
|
139
|
|
|
—
|
|
|
385
|
|
|||||
Total Liabilities
|
4,931
|
|
|
505
|
|
|
1,339
|
|
|
(3,593
|
)
|
|
3,182
|
|
|||||
Stockholders’ Equity
|
|
|
|
|
|
|
|
|
|
||||||||||
Dynegy Stockholders’ Equity
|
2,170
|
|
|
6,416
|
|
|
(69
|
)
|
|
(6,347
|
)
|
|
2,170
|
|
|||||
Intercompany receivable
|
—
|
|
|
(3,042
|
)
|
|
—
|
|
|
3,042
|
|
|
—
|
|
|||||
Total Dynegy Stockholders’ Equity
|
2,170
|
|
|
3,374
|
|
|
(69
|
)
|
|
(3,305
|
)
|
|
2,170
|
|
|||||
Noncontrolling interest
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Total Equity
|
2,170
|
|
|
3,374
|
|
|
(69
|
)
|
|
(3,305
|
)
|
|
2,170
|
|
|||||
Total Liabilities and Equity
|
$
|
7,101
|
|
|
$
|
3,879
|
|
|
$
|
1,270
|
|
|
$
|
(6,898
|
)
|
|
$
|
5,352
|
|
|
Parent
|
|
Guarantor Subsidiaries
|
|
Non-Guarantor Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||
Current Assets
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
$
|
474
|
|
|
$
|
154
|
|
|
$
|
215
|
|
|
$
|
—
|
|
|
$
|
843
|
|
Accounts receivable, net
|
2
|
|
|
133
|
|
|
289
|
|
|
(4
|
)
|
|
420
|
|
|||||
Intercompany receivable
|
—
|
|
|
275
|
|
|
74
|
|
|
(349
|
)
|
|
—
|
|
|||||
Inventory
|
—
|
|
|
71
|
|
|
110
|
|
|
—
|
|
|
181
|
|
|||||
Other current assets
|
8
|
|
|
131
|
|
|
102
|
|
|
—
|
|
|
241
|
|
|||||
Total Current Assets
|
484
|
|
|
764
|
|
|
790
|
|
|
(353
|
)
|
|
1,685
|
|
|||||
Property, Plant and Equipment, Net
|
—
|
|
|
2,937
|
|
|
378
|
|
|
—
|
|
|
3,315
|
|
|||||
Other Assets
|
|
|
|
|
|
|
|
|
|
||||||||||
Investment in affiliates
|
6,453
|
|
|
—
|
|
|
—
|
|
|
(6,453
|
)
|
|
—
|
|
|||||
Other long-term assets
|
133
|
|
|
61
|
|
|
97
|
|
|
—
|
|
|
291
|
|
|||||
Total Assets
|
$
|
7,070
|
|
|
$
|
3,762
|
|
|
$
|
1,265
|
|
|
$
|
(6,806
|
)
|
|
$
|
5,291
|
|
Current Liabilities
|
|
|
|
|
|
|
|
|
|
||||||||||
Accounts payable
|
$
|
4
|
|
|
$
|
114
|
|
|
$
|
215
|
|
|
$
|
(4
|
)
|
|
$
|
329
|
|
Intercompany payable
|
299
|
|
|
—
|
|
|
50
|
|
|
(349
|
)
|
|
—
|
|
|||||
Other current liabilities
|
132
|
|
|
139
|
|
|
121
|
|
|
—
|
|
|
392
|
|
|||||
Total Current Liabilities
|
435
|
|
|
253
|
|
|
386
|
|
|
(353
|
)
|
|
721
|
|
|||||
Long-term debt
|
1,285
|
|
|
11
|
|
|
683
|
|
|
—
|
|
|
1,979
|
|
|||||
Intercompany interest payable
|
799
|
|
|
—
|
|
|
—
|
|
|
(799
|
)
|
|
—
|
|
|||||
Intercompany long-term debt
|
2,243
|
|
|
—
|
|
|
—
|
|
|
(2,243
|
)
|
|
—
|
|
|||||
Other long-term liabilities
|
98
|
|
|
145
|
|
|
141
|
|
|
—
|
|
|
384
|
|
|||||
Total Liabilities
|
4,860
|
|
|
409
|
|
|
1,210
|
|
|
(3,395
|
)
|
|
3,084
|
|
|||||
Stockholders’ Equity
|
|
|
|
|
|
|
|
|
|
||||||||||
Dynegy Stockholders’ Equity
|
2,210
|
|
|
6,395
|
|
|
58
|
|
|
(6,453
|
)
|
|
2,210
|
|
|||||
Intercompany receivable
|
—
|
|
|
(3,042
|
)
|
|
—
|
|
|
3,042
|
|
|
—
|
|
|||||
Total Dynegy Stockholders’ Equity
|
2,210
|
|
|
3,353
|
|
|
58
|
|
|
(3,411
|
)
|
|
2,210
|
|
|||||
Noncontrolling interest
|
—
|
|
|
—
|
|
|
(3
|
)
|
|
—
|
|
|
(3
|
)
|
|||||
Total Equity
|
2,210
|
|
|
3,353
|
|
|
55
|
|
|
(3,411
|
)
|
|
2,207
|
|
|||||
Total Liabilities and Equity
|
$
|
7,070
|
|
|
$
|
3,762
|
|
|
$
|
1,265
|
|
|
$
|
(6,806
|
)
|
|
$
|
5,291
|
|
|
Parent
|
|
Guarantor Subsidiaries
|
|
Non-Guarantor Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||
Revenues
|
$
|
—
|
|
|
$
|
558
|
|
|
$
|
204
|
|
|
$
|
—
|
|
|
$
|
762
|
|
Cost of sales, excluding depreciation expense
|
—
|
|
|
(393
|
)
|
|
(159
|
)
|
|
—
|
|
|
(552
|
)
|
|||||
Gross margin
|
—
|
|
|
165
|
|
|
45
|
|
|
—
|
|
|
210
|
|
|||||
Operating and maintenance expense
|
—
|
|
|
(63
|
)
|
|
(47
|
)
|
|
—
|
|
|
(110
|
)
|
|||||
Depreciation expense
|
—
|
|
|
(58
|
)
|
|
(9
|
)
|
|
—
|
|
|
(67
|
)
|
|||||
General and administrative expense
|
(2
|
)
|
|
(14
|
)
|
|
(10
|
)
|
|
—
|
|
|
(26
|
)
|
|||||
Acquisition and integration costs
|
—
|
|
|
—
|
|
|
(6
|
)
|
|
—
|
|
|
(6
|
)
|
|||||
Operating income (loss)
|
(2
|
)
|
|
30
|
|
|
(27
|
)
|
|
—
|
|
|
1
|
|
|||||
Equity in losses from investments in affiliates
|
(17
|
)
|
|
—
|
|
|
—
|
|
|
17
|
|
|
—
|
|
|||||
Interest expense
|
(16
|
)
|
|
—
|
|
|
(14
|
)
|
|
—
|
|
|
(30
|
)
|
|||||
Other income and expense, net
|
(6
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(6
|
)
|
|||||
Income (loss) from continuing operations before income taxes
|
(41
|
)
|
|
30
|
|
|
(41
|
)
|
|
17
|
|
|
(35
|
)
|
|||||
Income tax expense
|
—
|
|
|
(2
|
)
|
|
—
|
|
|
—
|
|
|
(2
|
)
|
|||||
Net income (loss)
|
(41
|
)
|
|
28
|
|
|
(41
|
)
|
|
17
|
|
|
(37
|
)
|
|||||
Less: Net income attributable to the noncontrolling interests
|
—
|
|
|
—
|
|
|
4
|
|
|
—
|
|
|
4
|
|
|||||
Income (loss) attributable to Dynegy Inc.
|
$
|
(41
|
)
|
|
$
|
28
|
|
|
$
|
(45
|
)
|
|
$
|
17
|
|
|
$
|
(41
|
)
|
|
Parent
|
|
Guarantor Subsidiaries
|
|
Non-Guarantor Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||
Net income (loss)
|
$
|
(41
|
)
|
|
$
|
28
|
|
|
$
|
(41
|
)
|
|
$
|
17
|
|
|
$
|
(37
|
)
|
Other comprehensive income (loss) before reclassifications:
|
|
|
|
|
|
|
|
|
|
||||||||||
Actuarial loss, net of tax of zero
|
—
|
|
|
—
|
|
|
(3
|
)
|
|
—
|
|
|
(3
|
)
|
|||||
Amounts reclassified from accumulated other comprehensive income (loss):
|
|
|
|
|
|
|
|
|
|
||||||||||
Amortization of unrecognized prior service cost and actuarial loss, net of tax of zero
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
|||||
Other comprehensive income (loss) from investment in affiliates
|
(3
|
)
|
|
—
|
|
|
—
|
|
|
3
|
|
|
—
|
|
|||||
Other comprehensive income (loss), net of tax
|
(4
|
)
|
|
—
|
|
|
(3
|
)
|
|
3
|
|
|
(4
|
)
|
|||||
Comprehensive income (loss)
|
(45
|
)
|
|
28
|
|
|
(44
|
)
|
|
20
|
|
|
(41
|
)
|
|||||
Less: comprehensive income attributable to noncontrolling interests
|
(1
|
)
|
|
—
|
|
|
3
|
|
|
1
|
|
|
3
|
|
|||||
Total comprehensive income (loss) attributable to Dynegy Inc.
|
$
|
(44
|
)
|
|
$
|
28
|
|
|
$
|
(47
|
)
|
|
$
|
19
|
|
|
$
|
(44
|
)
|
|
Parent
|
|
Guarantor Subsidiaries
|
|
Non-Guarantor Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||
CASH FLOWS FROM OPERATING ACTIVITIES:
|
|
|
|
|
|
|
|
|
|
||||||||||
Net cash provided by (used in) operating activities
|
$
|
(9
|
)
|
|
$
|
140
|
|
|
$
|
35
|
|
|
$
|
—
|
|
|
$
|
166
|
|
CASH FLOWS FROM INVESTING ACTIVITIES:
|
|
|
|
|
|
|
|
|
|
||||||||||
Capital expenditures
|
—
|
|
|
(6
|
)
|
|
(11
|
)
|
|
—
|
|
|
(17
|
)
|
|||||
Net intercompany transfers
|
113
|
|
|
—
|
|
|
—
|
|
|
(113
|
)
|
|
—
|
|
|||||
Net cash provided by (used in) investing activities
|
113
|
|
|
(6
|
)
|
|
(11
|
)
|
|
(113
|
)
|
|
(17
|
)
|
|||||
CASH FLOWS FROM FINANCING ACTIVITIES:
|
|
|
|
|
|
|
|
|
|
||||||||||
Proceeds from long-term borrowings, net of financing costs
|
(1
|
)
|
|
12
|
|
|
—
|
|
|
—
|
|
|
11
|
|
|||||
Repayments of borrowings
|
(2
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2
|
)
|
|||||
Net intercompany transfers
|
—
|
|
|
(142
|
)
|
|
29
|
|
|
113
|
|
|
—
|
|
|||||
Interest rate swap settlement payments
|
(4
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4
|
)
|
|||||
Other financing
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
|||||
Net cash provided by (used in) financing activities
|
(8
|
)
|
|
(130
|
)
|
|
29
|
|
|
113
|
|
|
4
|
|
|||||
Net increase in cash and cash equivalents
|
96
|
|
|
4
|
|
|
53
|
|
|
—
|
|
|
153
|
|
|||||
Cash and cash equivalents, beginning of period
|
474
|
|
|
154
|
|
|
215
|
|
|
—
|
|
|
843
|
|
|||||
Cash and cash equivalents, end of period
|
$
|
570
|
|
|
$
|
158
|
|
|
$
|
268
|
|
|
$
|
—
|
|
|
$
|
996
|
|
(amounts in millions)
|
|
Coal
|
|
IPH
|
|
Gas
|
|
Other and
Eliminations
|
|
Total
|
||||||||||
Domestic:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Unaffiliated revenues
|
|
$
|
161
|
|
|
$
|
203
|
|
|
$
|
398
|
|
|
$
|
—
|
|
|
$
|
762
|
|
Intercompany revenues
|
|
(5
|
)
|
|
1
|
|
|
4
|
|
|
—
|
|
|
—
|
|
|||||
Total revenues
|
|
$
|
156
|
|
|
$
|
204
|
|
|
$
|
402
|
|
|
$
|
—
|
|
|
$
|
762
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Depreciation expense
|
|
$
|
(14
|
)
|
|
$
|
(8
|
)
|
|
$
|
(44
|
)
|
|
$
|
(1
|
)
|
|
$
|
(67
|
)
|
General and administrative expense
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(26
|
)
|
|
(26
|
)
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Operating income (loss)
|
|
$
|
9
|
|
|
$
|
(16
|
)
|
|
$
|
34
|
|
|
$
|
(26
|
)
|
|
$
|
1
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest expense
|
|
|
|
|
|
|
|
|
|
(30
|
)
|
|||||||||
Other items, net
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(6
|
)
|
|
(6
|
)
|
|||||
Loss before income taxes
|
|
|
|
|
|
|
|
|
|
|
|
|
(35
|
)
|
||||||
Income tax expense
|
|
|
|
|
|
|
|
|
|
|
|
|
(2
|
)
|
||||||
Net loss
|
|
|
|
|
|
|
|
|
|
(37
|
)
|
|||||||||
Less: Net income attributable to noncontrolling interests
|
|
|
|
|
|
|
|
|
|
4
|
|
|||||||||
Net loss attributable to Dynegy Inc.
|
|
|
|
|
|
|
|
|
|
$
|
(41
|
)
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Identifiable assets (domestic)
|
|
$
|
1,198
|
|
|
$
|
1,203
|
|
|
$
|
2,202
|
|
|
$
|
749
|
|
|
$
|
5,352
|
|
Capital expenditures
|
|
$
|
(3
|
)
|
|
$
|
(11
|
)
|
|
$
|
(2
|
)
|
|
$
|
(1
|
)
|
|
$
|
(17
|
)
|
(amounts in millions)
|
|
Coal
|
|
Gas
|
|
Other and
Eliminations
|
|
Total
|
||||||||
Domestic:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Unaffiliated revenues
|
|
$
|
87
|
|
|
$
|
231
|
|
|
$
|
—
|
|
|
$
|
318
|
|
Total revenues
|
|
$
|
87
|
|
|
$
|
231
|
|
|
$
|
—
|
|
|
$
|
318
|
|
|
|
|
|
|
|
|
|
|
||||||||
Depreciation expense
|
|
$
|
(13
|
)
|
|
$
|
(40
|
)
|
|
$
|
(1
|
)
|
|
$
|
(54
|
)
|
General and administrative expense
|
|
—
|
|
|
—
|
|
|
(22
|
)
|
|
(22
|
)
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Operating loss
|
|
$
|
(80
|
)
|
|
$
|
(8
|
)
|
|
$
|
(27
|
)
|
|
$
|
(115
|
)
|
|
|
|
|
|
|
|
|
|
||||||||
Interest expense
|
|
|
|
|
|
|
|
(28
|
)
|
|||||||
Other items, net
|
|
—
|
|
|
1
|
|
|
—
|
|
|
1
|
|
||||
Loss before income taxes
|
|
|
|
|
|
|
|
|
|
|
(142
|
)
|
||||
Income tax benefit
|
|
|
|
|
|
|
|
|
|
|
—
|
|
||||
Net loss
|
|
|
|
|
|
|
|
$
|
(142
|
)
|
||||||
|
|
|
|
|
|
|
|
|
||||||||
Identifiable assets (domestic)
|
|
$
|
1,234
|
|
|
$
|
2,716
|
|
|
$
|
432
|
|
|
$
|
4,382
|
|
Capital expenditures
|
|
$
|
(12
|
)
|
|
$
|
(8
|
)
|
|
$
|
—
|
|
|
$
|
(20
|
)
|
|
|
March 31, 2014
|
||||||||||
(amounts in millions)
|
|
Dynegy Inc.
|
|
IPH (1) (2)
|
|
Total
|
||||||
Revolver capacity
|
|
$
|
475
|
|
|
$
|
—
|
|
|
$
|
475
|
|
Less: Outstanding letters of credit
|
|
(166
|
)
|
|
—
|
|
|
(166
|
)
|
|||
Revolver availability
|
|
309
|
|
|
—
|
|
|
309
|
|
|||
Cash and cash equivalents
|
|
728
|
|
|
268
|
|
|
996
|
|
|||
Total available liquidity (3)
|
|
$
|
1,037
|
|
|
$
|
268
|
|
|
$
|
1,305
|
|
(1)
|
Includes Cash and cash equivalents of $191 million related to Genco.
|
(2)
|
As previously discussed, due to the ring-fenced nature of IPH, cash at the IPH and Genco entities may not be moved out of these entities without meeting certain criteria. However, cash at these entities is available to support current operations of these entities.
|
(3)
|
On December 2, 2013, Dynegy and IPR entered into an intercompany revolving promissory note of $25 million. At March 31, 2014, there was $12 million drawn on the note.
|
(amounts in millions)
|
|
March 31, 2014
|
|
December 31, 2013
|
||||
Dynegy Inc.:
|
|
|
|
|
||||
Cash (1)
|
|
$
|
38
|
|
|
$
|
22
|
|
Letters of credit
|
|
166
|
|
|
157
|
|
||
Total Dynegy Inc.
|
|
204
|
|
|
179
|
|
||
|
|
|
|
|
||||
IPH:
|
|
|
|
|
||||
Cash (1) (2)
|
|
18
|
|
|
7
|
|
||
Letters of credit (3)
|
|
10
|
|
|
—
|
|
||
Total IPH
|
|
28
|
|
|
7
|
|
||
|
|
|
|
|
||||
Total
|
|
$
|
232
|
|
|
$
|
186
|
|
(1)
|
Includes broker margin as well as other collateral postings included in Prepayments and other current assets on our unaudited consolidated balance sheets. At
March 31, 2014
and
December 31, 2013
,
$3 million
and
$4 million
of cash posted as collateral were netted against Liabilities from risk management activities on our unaudited consolidated balance sheets, respectively.
|
(2)
|
Includes cash of $5 million and $1 million related to Genco at
March 31, 2014
and
December 31, 2013
, respectively.
|
(3)
|
Relates to the $25 million cash-backed LC facility at IPM.
|
(amounts in millions)
|
|
Three Months Ended March 31, 2014
|
|
Three Months Ended March 31, 2013
|
||||
Coal
|
|
$
|
3
|
|
|
$
|
12
|
|
IPH
|
|
11
|
|
|
—
|
|
||
Gas
|
|
2
|
|
|
8
|
|
||
Other
|
|
1
|
|
|
—
|
|
||
Total
|
|
$
|
17
|
|
|
$
|
20
|
|
Compliance Period
|
|
Consolidated Senior Secured Net Debt to Consolidated Adjusted EBITDA (1)
|
September 30, 2013 through December 31, 2013
|
|
5.00: 1.00
|
March 31, 2014 through December 31, 2014
|
|
4.00: 1.00
|
March 31, 2015 through December 31, 2015
|
|
4.75: 1.00
|
March 31, 2016 through December 31, 2016
|
|
3.75: 1.00
|
March 31, 2017 and Thereafter
|
|
3.00: 1.00
|
(1)
|
For purposes of calculating Net Debt, we may only apply a maximum of
$150 million
in cash to our outstanding secured debt.
|
|
|
Required Ratio
|
Restricted payment interest coverage ratio (1)
|
|
≥1.75
|
Additional indebtedness interest coverage ratio (2)
|
|
≥2.50
|
Additional indebtedness debt-to-capital ratio (2)
|
|
≤60%
|
(1)
|
As of the date of a restricted payment, as defined, the minimum ratio must have been achieved for the most recently ended four fiscal quarters and projected by management to be achieved for each of the subsequent four six-month periods.
|
(2)
|
Ratios must be computed on a pro forma basis considering the additional indebtedness to be incurred and the related interest expense. Other borrowings from third-party external sources are included in the definition of indebtedness and are subject to these incurrence tests.
|
|
|
Moody’s
|
|
S&P
|
Dynegy Inc.:
|
|
|
|
|
Corporate Family Rating
|
|
B2
|
|
B
|
Senior Secured
|
|
B1
|
|
BB-
|
Senior Unsecured
|
|
B3
|
|
B+
|
Genco:
|
|
|
|
|
Senior Unsecured
|
|
B3
|
|
CCC+
|
|
|
Three Months Ended March 31,
|
|
Favorable (Unfavorable) $ Change
|
|
Favorable (Unfavorable) % Change
|
|||||||||
(amounts in millions)
|
|
2014
|
|
2013
|
|
|
|||||||||
Revenues
|
|
$
|
762
|
|
|
$
|
318
|
|
|
$
|
444
|
|
|
140
|
%
|
Cost of sales, excluding depreciation expense
|
|
(552
|
)
|
|
(284
|
)
|
|
(268
|
)
|
|
(94
|
)%
|
|||
Gross margin
|
|
210
|
|
|
34
|
|
|
176
|
|
|
NM
|
|
|||
Operating and maintenance expense
|
|
(110
|
)
|
|
(71
|
)
|
|
(39
|
)
|
|
(55
|
)%
|
|||
Depreciation expense
|
|
(67
|
)
|
|
(54
|
)
|
|
(13
|
)
|
|
(24
|
)%
|
|||
Gain on sale of assets, net
|
|
—
|
|
|
1
|
|
|
(1
|
)
|
|
(100
|
)%
|
|||
General and administrative expense
|
|
(26
|
)
|
|
(22
|
)
|
|
(4
|
)
|
|
(18
|
)%
|
|||
Acquisition and integration costs
|
|
(6
|
)
|
|
(3
|
)
|
|
(3
|
)
|
|
(100
|
)%
|
|||
Operating income (loss)
|
|
1
|
|
|
(115
|
)
|
|
116
|
|
|
101
|
%
|
|||
Interest expense
|
|
(30
|
)
|
|
(28
|
)
|
|
(2
|
)
|
|
(7
|
)%
|
|||
Other income and expense, net
|
|
(6
|
)
|
|
1
|
|
|
(7
|
)
|
|
NM
|
|
|||
Loss before income taxes
|
|
(35
|
)
|
|
(142
|
)
|
|
107
|
|
|
75
|
%
|
|||
Income tax expense
|
|
(2
|
)
|
|
—
|
|
|
(2
|
)
|
|
(100
|
)%
|
|||
Net loss
|
|
(37
|
)
|
|
(142
|
)
|
|
105
|
|
|
74
|
%
|
|||
Less: Net income attributable to noncontrolling interests
|
|
4
|
|
|
—
|
|
|
4
|
|
|
100
|
%
|
|||
Net loss attributable to Dynegy Inc.
|
|
$
|
(41
|
)
|
|
$
|
(142
|
)
|
|
$
|
101
|
|
|
71
|
%
|
|
|
Three Months Ended March 31, 2014
|
||||||||||||||||||
(amounts in millions)
|
|
Coal
|
|
IPH
|
|
Gas
|
|
Other
|
|
Total
|
||||||||||
Revenues
|
|
$
|
156
|
|
|
$
|
204
|
|
|
$
|
402
|
|
|
$
|
—
|
|
|
$
|
762
|
|
Cost of sales, excluding depreciation expense
|
|
(96
|
)
|
|
(159
|
)
|
|
(297
|
)
|
|
—
|
|
|
(552
|
)
|
|||||
Gross margin
|
|
60
|
|
|
45
|
|
|
105
|
|
|
—
|
|
|
210
|
|
|||||
Operating and maintenance expense
|
|
(37
|
)
|
|
(47
|
)
|
|
(27
|
)
|
|
1
|
|
|
(110
|
)
|
|||||
Depreciation expense
|
|
(14
|
)
|
|
(8
|
)
|
|
(44
|
)
|
|
(1
|
)
|
|
(67
|
)
|
|||||
General and administrative expense
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(26
|
)
|
|
(26
|
)
|
|||||
Acquisition and integration costs (1)
|
|
—
|
|
|
(6
|
)
|
|
—
|
|
|
—
|
|
|
(6
|
)
|
|||||
Operating income (loss)
|
|
$
|
9
|
|
|
$
|
(16
|
)
|
|
$
|
34
|
|
|
$
|
(26
|
)
|
|
$
|
1
|
|
|
|
Three Months Ended March 31, 2013
|
||||||||||||||
(amounts in millions)
|
|
Coal
|
|
Gas
|
|
Other
|
|
Total
|
||||||||
Revenues
|
|
$
|
87
|
|
|
$
|
231
|
|
|
$
|
—
|
|
|
$
|
318
|
|
Cost of sales, excluding depreciation expense
|
|
(115
|
)
|
|
(169
|
)
|
|
—
|
|
|
(284
|
)
|
||||
Gross margin
|
|
(28
|
)
|
|
62
|
|
|
—
|
|
|
34
|
|
||||
Operating and maintenance expense
|
|
(40
|
)
|
|
(30
|
)
|
|
(1
|
)
|
|
(71
|
)
|
||||
Depreciation expense
|
|
(13
|
)
|
|
(40
|
)
|
|
(1
|
)
|
|
(54
|
)
|
||||
Gain on sale of assets, net
|
|
1
|
|
|
—
|
|
|
—
|
|
|
1
|
|
||||
General and administrative expense
|
|
—
|
|
|
—
|
|
|
(22
|
)
|
|
(22
|
)
|
||||
Acquisition and integration costs (1)(2)
|
|
—
|
|
|
—
|
|
|
(3
|
)
|
|
(3
|
)
|
||||
Operating loss
|
|
$
|
(80
|
)
|
|
$
|
(8
|
)
|
|
$
|
(27
|
)
|
|
$
|
(115
|
)
|
(1)
|
Relates to costs associated with the AER Transaction Agreement. Please read
Note 3—Acquisition
for further discussion.
|
(2)
|
Acquisition and integration costs were captured in the Other segment prior to the closing of the AER Acquisition.
|
|
|
Three Months Ended March 31, 2014
|
||||||||||||||||||
(amounts in millions)
|
|
Coal
|
|
IPH
|
|
Gas
|
|
Other
|
|
Total
|
||||||||||
Net loss attributable to Dynegy Inc.
|
|
|
|
|
|
|
|
|
|
$
|
(41
|
)
|
||||||||
Income attributable to noncontrolling interest
|
|
|
|
|
|
|
|
|
|
4
|
|
|||||||||
Income tax expense
|
|
|
|
|
|
|
|
|
|
2
|
|
|||||||||
Interest expense
|
|
|
|
|
|
|
|
|
|
30
|
|
|||||||||
Other items, net
|
|
|
|
|
|
|
|
|
|
6
|
|
|||||||||
Operating income (loss)
|
|
$
|
9
|
|
|
$
|
(16
|
)
|
|
$
|
34
|
|
|
$
|
(26
|
)
|
|
$
|
1
|
|
Depreciation expense
|
|
14
|
|
|
8
|
|
|
44
|
|
|
1
|
|
|
67
|
|
|||||
Amortization of intangible assets and liabilities, net
|
|
(1
|
)
|
|
(1
|
)
|
|
18
|
|
|
—
|
|
|
16
|
|
|||||
Other items, net
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(6
|
)
|
|
(6
|
)
|
|||||
EBITDA
|
|
22
|
|
|
(9
|
)
|
|
96
|
|
|
(31
|
)
|
|
78
|
|
|||||
Acquisition and integration costs
|
|
—
|
|
|
6
|
|
|
—
|
|
|
—
|
|
|
6
|
|
|||||
Mark-to-market loss, net
|
|
19
|
|
|
34
|
|
|
8
|
|
|
—
|
|
|
61
|
|
|||||
Change in fair value of common stock warrants
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6
|
|
|
6
|
|
|||||
Income attributable to noncontrolling interest
|
|
—
|
|
|
(4
|
)
|
|
—
|
|
|
—
|
|
|
(4
|
)
|
|||||
Other
|
|
1
|
|
|
3
|
|
|
—
|
|
|
1
|
|
|
5
|
|
|||||
Adjusted EBITDA
|
|
$
|
42
|
|
|
$
|
30
|
|
|
$
|
104
|
|
|
$
|
(24
|
)
|
|
$
|
152
|
|
|
|
Three Months Ended March 31, 2013
|
||||||||||||||
(amounts in millions)
|
|
Coal
|
|
Gas
|
|
Other
|
|
Total
|
||||||||
Net loss
|
|
|
|
|
|
|
|
$
|
(142
|
)
|
||||||
Interest expense
|
|
|
|
|
|
|
|
28
|
|
|||||||
Other items, net
|
|
|
|
|
|
|
|
(1
|
)
|
|||||||
Operating loss
|
|
$
|
(80
|
)
|
|
$
|
(8
|
)
|
|
$
|
(27
|
)
|
|
$
|
(115
|
)
|
Depreciation expense
|
|
13
|
|
|
40
|
|
|
1
|
|
|
54
|
|
||||
Amortization of intangible assets and liabilities, net
|
|
31
|
|
|
32
|
|
|
—
|
|
|
63
|
|
||||
Other items, net
|
|
—
|
|
|
1
|
|
|
—
|
|
|
1
|
|
||||
EBITDA
|
|
(36
|
)
|
|
65
|
|
|
(26
|
)
|
|
3
|
|
||||
Acquisition and integration costs
|
|
—
|
|
|
—
|
|
|
3
|
|
|
3
|
|
||||
Mark-to-market (income) loss, net
|
|
40
|
|
|
(4
|
)
|
|
—
|
|
|
36
|
|
||||
Other
|
|
—
|
|
|
—
|
|
|
1
|
|
|
1
|
|
||||
Adjusted EBITDA
|
|
$
|
4
|
|
|
$
|
61
|
|
|
$
|
(22
|
)
|
|
$
|
43
|
|
|
|
Three Months Ended March 31,
|
|
Favorable (Unfavorable) $ Change
|
|
Favorable (Unfavorable) % Change
|
|||||||||
(dollars in millions, except for price information)
|
|
2014
|
|
2013
|
|
|
|||||||||
Operating Revenues
|
|
|
|
|
|
|
|
|
|
|
|
||||
Energy
|
|
$
|
218
|
|
|
$
|
119
|
|
|
$
|
99
|
|
|
83
|
%
|
Capacity
|
|
2
|
|
|
—
|
|
|
2
|
|
|
100
|
%
|
|||
Mark-to-market loss, net
|
|
(19
|
)
|
|
(40
|
)
|
|
21
|
|
|
53
|
%
|
|||
Other (1)
|
|
(45
|
)
|
|
8
|
|
|
(53
|
)
|
|
(663
|
)%
|
|||
Total operating revenues
|
|
156
|
|
|
87
|
|
|
69
|
|
|
79
|
%
|
|||
Operating Costs
|
|
|
|
|
|
|
|
|
|
|
|
||||
Cost of sales
|
|
(97
|
)
|
|
(84
|
)
|
|
(13
|
)
|
|
(15
|
)%
|
|||
Contract amortization
|
|
1
|
|
|
(31
|
)
|
|
32
|
|
|
103
|
%
|
|||
Total operating costs
|
|
(96
|
)
|
|
(115
|
)
|
|
19
|
|
|
17
|
%
|
|||
Gross margin
|
|
60
|
|
|
(28
|
)
|
|
88
|
|
|
314
|
%
|
|||
Operating and maintenance expense
|
|
(37
|
)
|
|
(40
|
)
|
|
3
|
|
|
8
|
%
|
|||
Depreciation expense
|
|
(14
|
)
|
|
(13
|
)
|
|
(1
|
)
|
|
(8
|
)%
|
|||
Gain on sale of assets, net
|
|
—
|
|
|
1
|
|
|
(1
|
)
|
|
(100
|
)%
|
|||
Operating income (loss)
|
|
9
|
|
|
(80
|
)
|
|
89
|
|
|
111
|
%
|
|||
Depreciation expense
|
|
14
|
|
|
13
|
|
|
1
|
|
|
8
|
%
|
|||
Amortization of intangible assets and liabilities, net
|
|
(1
|
)
|
|
31
|
|
|
(32
|
)
|
|
(103
|
)%
|
|||
EBITDA
|
|
22
|
|
|
(36
|
)
|
|
58
|
|
|
161
|
%
|
|||
Mark-to-market loss, net
|
|
19
|
|
|
40
|
|
|
(21
|
)
|
|
(53
|
)%
|
|||
Other
|
|
1
|
|
|
—
|
|
|
1
|
|
|
100
|
%
|
|||
Adjusted EBITDA
|
|
$
|
42
|
|
|
$
|
4
|
|
|
$
|
38
|
|
|
950
|
%
|
|
|
|
|
|
|
|
|
|
|||||||
Million Megawatt Hours Generated (2)
|
|
5.3
|
|
|
5.0
|
|
|
0.3
|
|
|
6
|
%
|
|||
In Market Availability for Coal-Fired Facilities (3)
|
|
88
|
%
|
|
89
|
%
|
|
|
|
|
|||||
Average Quoted Market Power Prices ($/MWh) (4):
|
|
|
|
|
|
|
|
|
|
|
|||||
On-Peak: Indiana (Indy Hub)
|
|
$
|
71.51
|
|
|
$
|
34.15
|
|
|
$
|
37.36
|
|
|
109
|
%
|
Off-Peak: Indiana (Indy Hub)
|
|
$
|
42.97
|
|
|
$
|
26.93
|
|
|
$
|
16.04
|
|
|
60
|
%
|
(1)
|
For the three months ended March 31, 2014 and 2013, respectively, Other includes ($46) million and $10 million in financial settlements, $1 million and $1 million in ancillary services and $2 million and ($3) million in other miscellaneous items.
|
(2)
|
Reflects production volumes in million MWh generated.
|
(3)
|
In Market Availability 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. This calculation excludes certain events outside of management control such as weather related issues.
|
(4)
|
Reflects the average of day-ahead quoted prices for the periods presented and does not necessarily reflect prices we realized.
|
(dollars in millions, except for price information)
|
|
Three Months Ended March 31, 2014
|
||
Operating Revenues
|
|
|
||
Energy
|
|
$
|
213
|
|
Capacity
|
|
6
|
|
|
Mark-to-market loss, net
|
|
(34
|
)
|
|
Contract amortization
|
|
(9
|
)
|
|
Other (1)
|
|
28
|
|
|
Total operating revenues
|
|
204
|
|
|
Operating Costs
|
|
|
||
Cost of sales
|
|
(169
|
)
|
|
Contract amortization
|
|
10
|
|
|
Total operating costs
|
|
(159
|
)
|
|
Gross margin
|
|
45
|
|
|
Operating and maintenance expense
|
|
(47
|
)
|
|
Depreciation expense
|
|
(8
|
)
|
|
Acquisition and integration costs
|
|
(6
|
)
|
|
Operating loss
|
|
(16
|
)
|
|
Depreciation expense
|
|
8
|
|
|
Amortization of intangible assets and liabilities, net
|
|
(1
|
)
|
|
EBITDA
|
|
(9
|
)
|
|
Mark-to-market loss, net
|
|
34
|
|
|
Acquisition and integration costs
|
|
6
|
|
|
Income attributable to noncontrolling interest
|
|
(4
|
)
|
|
Other
|
|
3
|
|
|
Adjusted EBITDA
|
|
$
|
30
|
|
|
|
|
||
Million Megawatt Hours Generated (2)
|
|
6.7
|
|
|
In Market Availability for Coal-Fired Facilities (3)
|
|
90
|
%
|
|
Average Quoted Market Power Prices ($/MWh) (4):
|
|
|
||
On-Peak: Indiana (Indy Hub)
|
|
$
|
71.51
|
|
Off-Peak: Indiana (Indy Hub)
|
|
$
|
42.97
|
|
(1)
|
For the three months ended March 31, 2014, Other includes $26 million in financial settlements, ($1) million in ancillary services and $3 million in other miscellaneous items.
|
(2)
|
Reflects production volumes in million MWh generated.
|
(3)
|
In Market Availability 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. This calculation excludes certain events outside of management control such as weather related issues.
|
(4)
|
Reflects the average of day-ahead quoted prices for the periods presented and does not necessarily reflect prices we realized.
|
|
|
Three Months Ended March 31,
|
|
Favorable (Unfavorable) $ Change
|
|
Favorable (Unfavorable) % Change
|
|||||||||
(dollars in millions, except for price information)
|
|
2014
|
|
2013
|
|
|
|||||||||
Operating Revenues
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Energy
|
|
$
|
416
|
|
|
$
|
169
|
|
|
$
|
247
|
|
|
146
|
%
|
Capacity
|
|
52
|
|
|
52
|
|
|
—
|
|
|
—
|
%
|
|||
Mark-to-market income (loss), net
|
|
(8
|
)
|
|
3
|
|
|
(11
|
)
|
|
(367
|
)%
|
|||
Contract amortization
|
|
(20
|
)
|
|
(34
|
)
|
|
14
|
|
|
41
|
%
|
|||
Other (1)
|
|
(38
|
)
|
|
41
|
|
|
(79
|
)
|
|
(193
|
)%
|
|||
Total operating revenues
|
|
402
|
|
|
231
|
|
|
171
|
|
|
74
|
%
|
|||
Operating Costs
|
|
|
|
|
|
|
|
|
|||||||
Cost of sales
|
|
(299
|
)
|
|
(171
|
)
|
|
(128
|
)
|
|
(75
|
)%
|
|||
Contract amortization
|
|
2
|
|
|
2
|
|
|
—
|
|
|
—
|
%
|
|||
Total operating costs
|
|
(297
|
)
|
|
(169
|
)
|
|
(128
|
)
|
|
(76
|
)%
|
|||
Gross margin
|
|
105
|
|
|
62
|
|
|
43
|
|
|
69
|
%
|
|||
Operating and maintenance expense
|
|
(27
|
)
|
|
(30
|
)
|
|
3
|
|
|
10
|
%
|
|||
Depreciation expense
|
|
(44
|
)
|
|
(40
|
)
|
|
(4
|
)
|
|
(10
|
)%
|
|||
Operating income (loss)
|
|
34
|
|
|
(8
|
)
|
|
42
|
|
|
525
|
%
|
|||
Depreciation expense
|
|
44
|
|
|
40
|
|
|
4
|
|
|
10
|
%
|
|||
Amortization of intangible assets and liabilities, net
|
|
18
|
|
|
32
|
|
|
(14
|
)
|
|
(44
|
)%
|
|||
Other items, net
|
|
—
|
|
|
1
|
|
|
(1
|
)
|
|
(100
|
)%
|
|||
EBITDA
|
|
96
|
|
|
65
|
|
|
31
|
|
|
48
|
%
|
|||
Mark-to-market (income) loss, net
|
|
8
|
|
|
(4
|
)
|
|
12
|
|
|
300
|
%
|
|||
Adjusted EBITDA
|
|
$
|
104
|
|
|
$
|
61
|
|
|
$
|
43
|
|
|
70
|
%
|
|
|
|
|
|
|
|
|
|
|||||||
Million Megawatt Hours Generated (2)
|
|
4.5
|
|
|
4.3
|
|
|
0.2
|
|
|
5
|
%
|
|||
In Market Availability for Combined Cycle Facilities (3)
|
|
99
|
%
|
|
97
|
%
|
|
|
|
|
|||||
Average Capacity Factor for Combined Cycle Facilities (4)
|
|
47
|
%
|
|
45
|
%
|
|
|
|
|
|
|
|||
Average Market On-Peak Spark Spreads ($/MWh) (5)
|
|
$
|
29.87
|
|
|
$
|
13.15
|
|
|
$
|
16.72
|
|
|
127
|
%
|
Average Market Off-Peak Spark Spreads ($/MWh) (5)
|
|
$
|
(6.31
|
)
|
|
$
|
4.25
|
|
|
$
|
(10.56
|
)
|
|
(248
|
)%
|
Average natural gas price—Henry Hub ($/MMBtu) (6)
|
|
$
|
5.05
|
|
|
$
|
3.48
|
|
|
$
|
1.57
|
|
|
45
|
%
|
(1)
|
For the three months ended March 31, 2014 and 2013, respectively, Other includes ($93) million and ($9) million in financial settlements, $37 million and $22 million in natural gas, $16 million and $8 million in ancillary services, $1 million and $16 million in tolls and $1 million and $4 million in RMR, option premiums and other miscellaneous items.
|
(2)
|
Includes our ownership percentage in the MWh generated by our investment in the Black Mountain power generation facility.
|
(3)
|
In Market Availability is an internal measurement calculation that reflects the percentage of generation available when market prices are such that these units could be profitably dispatched. This calculation excludes certain events outside of management control such as weather related issues.
|
(4)
|
Reflects actual production as a percentage of available capacity.
|
(5)
|
Reflects the average of our on- and off-peak spark spreads at the following facilities: Commonwealth Edison (NI Hub), PJM West, North of Path 15 (NP 15), New York - Zone A and Mass Hub.
|
(6)
|
Reflects the average of daily quoted prices for the periods presented and does not reflect costs incurred by us.
|
(amounts in millions)
|
|
As of and for the Three Months Ended March 31, 2014
|
||
Fair value of portfolio at December 31, 2013
|
|
$
|
(62
|
)
|
Risk management losses recognized through the statement of operations in the period, net
|
|
(63
|
)
|
|
Contracts realized or otherwise settled during the period
|
|
11
|
|
|
Changes in collateral/margin netting
|
|
(1
|
)
|
|
Fair value of portfolio at March 31, 2014
|
|
$
|
(115
|
)
|
(amounts in millions)
|
|
Total
|
|
2014
|
|
2015
|
|
2016
|
|
2017
|
|
2018
|
|
Thereafter
|
||||||||||||||
Market quotations (1) (2)
|
|
$
|
(106
|
)
|
|
$
|
(73
|
)
|
|
$
|
(22
|
)
|
|
$
|
(11
|
)
|
|
$
|
(5
|
)
|
|
$
|
1
|
|
|
$
|
4
|
|
Prices based on models (2)
|
|
(12
|
)
|
|
(9
|
)
|
|
(3
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Total (3)
|
|
$
|
(118
|
)
|
|
$
|
(82
|
)
|
|
$
|
(25
|
)
|
|
$
|
(11
|
)
|
|
$
|
(5
|
)
|
|
$
|
1
|
|
|
$
|
4
|
|
(3)
|
Excludes
$3 million
of broker margin that has been netted against Risk Management liabilities on our unaudited consolidated balance sheets. Please read
Note 4—Risk Management Activities, Derivatives and Financial Instruments
for further discussion.
|
•
|
expectations regarding 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 to which we are, or could become, subject;
|
•
|
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 natural gas prices, if any;
|
•
|
sufficiency of, access to and costs associated with coal, fuel oil and natural gas inventories and transportation thereof;
|
•
|
beliefs and assumptions about market competition, generation capacity and regional supply and demand characteristics of the wholesale and retail power generation market, including the anticipation of plant retirements and higher market pricing over the longer term;
|
•
|
the effects of, or changes to, MISO power procurement process;
|
•
|
the effectiveness of our strategies to capture opportunities presented by changes in commodity prices and to manage our exposure to energy price volatility;
|
•
|
efforts to secure retail sales and the ability to grow the retail business;
|
•
|
efforts to identify opportunities to reduce congestion and improve busbar power prices;
|
•
|
beliefs and assumptions about weather and general economic conditions;
|
•
|
projected operating or financial results, including anticipated cash flows from operations, revenues and profitability;
|
•
|
expectations regarding our compliance with the Credit Agreement, including collateral demands, interest expense, any applicable financial ratios and other payments;
|
•
|
our focus on safety and our ability to efficiently operate our assets so as to capture revenue generating opportunities and operating margins;
|
•
|
beliefs about the costs and scope of the ongoing demolition and site remediation efforts at the South Bay and Vermilion facilities;
|
•
|
beliefs regarding successful renegotiation of the IBEW Local 1245 collective bargaining agreement;
|
•
|
beliefs regarding redevelopment efforts for the Morro Bay facility;
|
•
|
beliefs and assumptions regarding approval by the CPUC of the SCE 2016 transaction for Moss Landing Units 6 & 7;
|
•
|
ability to mitigate impacts associated with expiring RMR and/or capacity contracts;
|
•
|
beliefs about the outcome of legal, administrative, legislative and regulatory matters;
|
•
|
anticipated benefits and expected synergies resulting from the AER Acquisition and beliefs associated with the integration of operations;
|
•
|
lack of comparable financial data due to the application of fresh-start accounting;
|
•
|
the timing and anticipated benefits to be achieved through our company-wide savings improvement programs, including our PRIDE initiative; and
|
•
|
expectations regarding performance standards and capital and maintenance expenditures.
|
(amounts in millions)
|
|
March 31, 2014
|
|
December 31, 2013
|
||||
One day VaR—95 percent confidence level
|
|
$
|
7
|
|
|
$
|
7
|
|
One day VaR—99 percent confidence level
|
|
$
|
9
|
|
|
$
|
10
|
|
Average VaR—95 percent confidence level for the rolling twelve months ended
|
|
$
|
4
|
|
|
$
|
4
|
|
(amounts in millions)
|
|
Investment
Grade Quality
|
|
Non-Investment
Grade Quality
|
|
Total
|
||||||
Type of Business:
|
|
|
|
|
|
|
|
|
|
|||
Financial institutions
|
|
$
|
4
|
|
|
$
|
—
|
|
|
$
|
4
|
|
Oil and gas producers
|
|
1
|
|
|
—
|
|
|
1
|
|
|||
Utility and power generators
|
|
7
|
|
|
—
|
|
|
7
|
|
|||
Total
|
|
$
|
12
|
|
|
$
|
—
|
|
|
$
|
12
|
|
|
|
March 31, 2014
|
|
December 31, 2013
|
||||
Interest rate swaps (in millions of U.S. dollars) (1)
|
|
$
|
796
|
|
|
$
|
796
|
|
Fixed interest rate paid (percent)
|
|
3.15
|
|
|
3.15
|
|
(1)
|
The calculation period for $250 million of the interest rate swaps began June 30, 2013, and the calculation period for the remaining $546 million began October 31, 2013.
|
Exhibit
Number
|
|
Description
|
**10.1
|
|
Form of Non-Qualified Stock Option Award Agreement (2014 Awards).
|
**10.2
|
|
Form of Stock Unit Award Agreement - Officers (2014 Awards).
|
**10.3
|
|
Form of Performance Award Agreement (2014 Awards).
|
**31.1
|
|
Chief Executive Officer Certification Pursuant to Rule 13a-14(a) and 15d-14(a), As Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
**31.2
|
|
Chief Financial Officer Certification Pursuant to Rule 13a-14(a) and 15d-14(a), As Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
†32.1
|
|
Chief Executive Officer Certification Pursuant to 18 United States Code Section 1350, As Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
†32.2
|
|
Chief Financial Officer Certification Pursuant to 18 United States Code Section 1350, As Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
**101.INS
|
|
XBRL Instance Document
|
**101.SCH
|
|
XBRL Taxonomy Extension Schema Document
|
**101.CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
**101.DEF
|
|
XBRL Taxonomy Extension Definition Linkbase Document
|
**101.LAB
|
|
XBRL Taxonomy Extension Label Linkbase Document
|
**101.PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
|
|
|
DYNEGY INC.
|
|
|
|
|
Date:
|
May 8, 2014
|
By:
|
/s/ CLINT C. FREELAND
|
|
|
|
Clint C. Freeland
Executive Vice President and Chief Financial Officer
|
1.
|
I have reviewed this report on Form 10-Q of Dynegy Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this quarterly report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date:
|
May 8, 2014
|
By:
|
/s/ R
OBERT
C
.
F
LEXON
|
|
|
|
Robert C. Flexon
President and Chief Executive Officer
|
1.
|
I have reviewed this report on Form 10-Q of Dynegy Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this quarterly report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date:
|
May 8, 2014
|
By:
|
/s/ C
LINT
C. F
REELAND
|
|
|
|
Clint C. Freeland
Executive Vice President and Chief Financial Officer
|
(1)
|
the Report fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934, and
|
(2)
|
the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company at the dates and for the periods indicated.
|
Date:
|
May 8, 2014
|
By:
|
/s/ ROBERT C. FLEXON
|
|
|
|
Robert C. Flexon
President and Chief Executive Officer
|
(1)
|
the Report fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934, and
|
(2)
|
the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company at the dates and for the periods indicated.
|
Date:
|
May 8, 2014
|
By:
|
/s/ C
LINT
C. F
REELAND
|
|
|
|
Clint C. Freeland
Executive Vice President and Chief Financial Officer
|
Title:
|
Vice President – Human Resources and Business Services
|
Title:
|
Vice President – Human Resources and Business Services
|
1.
|
“Involuntary Termination” shall have the same meaning as specified in the Dynegy Inc. Executive Severance Pay Plan.
|
Title:
|
Vice President – Human Resources and Business Services
|
•
|
AES Corporation (AES)
|
•
|
DTE Energy Company (DTE)
|
•
|
FirstEnergy (FE)
|
•
|
Public Service Enterprise Group (PSEG)
|
•
|
Ameren Corporation (AEE)
|
•
|
Edison International (EIX)
|
•
|
NextEra Energy, Inc (NEE)
|
•
|
Sempra Energy (SRE)
|
•
|
Calpine Corporation (CPN)
|
•
|
Entergy Corporation (ETR)
|
•
|
NRG Energy Inc. (NRG)
|
•
|
Dominion Resources, Inc. (D)
|
•
|
Exelon Corporation (EXC)
|
•
|
PPL Corporation (PPL)
|