Dynegy Announces Full-Year 2011 Results, Provides Restructuring Update

Dynegy Inc. (NYSE:DYN) announced a $236 million operating loss for the full twelve months of 2011 compared to an operating loss of $11 million for 2010. These results include pre-tax, unrealized, net mark-to-market losses of $175 million ($107 million after-tax) and mark-to-market gains of $18 million ($11 million after-tax) during the years ended December 31, 2011 and 2010, respectively. 2011 Adjusted EBITDA was $281 million compared to $539 million for 2010. The reduced operating results can be attributed to a $31 million decrease in energy margins, $50 million in lower capacity revenues in all markets, a $123 million decrease in premium revenue due to fewer options sold, and a $34 million loss related to natural gas during the fourth quarter. These results were partially offset by $58 million in lower fixed operating costs. Primarily as a result of the $1,657 million non-cash loss on deconsolidation, the net loss for the full year ended December 31, 2011 totaled $1,645 million compared to a net loss of $234 million for 2010.

The operating loss for the fourth quarter of 2011 was $86 million, compared to an operating loss of $163 million during the fourth quarter 2010. These results include pre-tax, unrealized, net mark-to-market losses of $35 million ($21 million after-tax) and mark-to-market losses of $105 million ($64 million after-tax) in the fourth quarter of 2011 and 2010, respectively. Adjusted EBITDA for the fourth quarter of 2011 totaled $(14) million, a decrease of $117 million compared to the fourth quarter 2010. Of the decrease, $37 million is attributable to compressed energy margins and lower generation volumes, arising from lower market prices and outages – both planned and unplanned. An additional $80 million of the decrease is associated with hedging, broker fees and the natural gas loss. The Company realized a net loss of $1,377 million during the quarter ended December 31, 2011, compared to a net loss of $164 million during the same period in 2010 with the difference primarily attributable to the $1,657 million non-cash loss on deconsolidation.

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