Ameren sustains huge loss in 2012

Ameren Corp., parent company of Peoria-based Ameren Illinois, sustained a loss of nearly $1 billion in 2012 because of several factors, including lower natural gas revenues because of last winter's mild weather.

The loss for St. Louis-based Ameren, which provides utilities for a large portion of Illinois, was $974 million, or $4.01 per share, compared with a profit of $519 million, or $2.15 a share, in 2011.

However, the company said, exclude after-tax impairments and non-recurring charges topping $1.5 billion and Ameren would have posted a profit in 2012, as well.

For the fourth quarter of 2012, Ameren recorded a net loss of $1.156 billion, or $4.76 a share, compared with a profit of $25 million, or 10 cents a share, in the fourth quarter of 2011.

The company said Ameren Illinois earnings declined because its was limited on its return on equity because of low Treasury bond yields and nonrecoverable costs related to implementation of formula ratemaking for electric delivery service last year.

"In addition, natural gas sales volumes declined reflecting warmer 2012 winter temperatures. Merchant generation segment earnings also declined reflecting lower power prices and higher fuel costs," the company said. Those declines were partially offset by increased Ameren Missouri earnings due primarily to the full year effect of a 2011 electric rate increase as well as other factors.

"Adjusted earnings for 2012 were in line with both our narrowed November and our initial year-ago guidance ranges," said Thomas R. Voss, chairman of Ameren Corp. "I am proud of several significant accomplishments in 2012. These include record safety metrics as well as strong electric distribution system reliability and operating performance at our energy centers. In addition, we advanced our plans to invest in electric transmission projects, including obtaining additional FERC approvals for constructive rate treatments for our investments. Further, we received a needed electric rate increase in Missouri that became effective in early 2013.

"Last year also had its share of challenges, including disappointing decisions by the Illinois Commerce Commission in our electric delivery formula rate cases ­­— decisions we are working to improve through legislation and the courts — and continued downward pressure on already low forward market prices for power," Voss added. "The latter contributed to our December announcement of our intent to exit the merchant generation business and a related noncash impairment charge. Exiting merchant generation will result in Ameren's businesses being solely rate-regulated utilities with solid growth prospects as we continue to allocate capital to jurisdictions that have modernized their regulatory framework in support of energy infrastructure investments. In addition, we are seeking to enhance the regulatory framework in Missouri to better support investment in our energy infrastructure. We strongly believe that such investment will result in long-term benefits for our customers and create jobs to support our local economy."