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AES Reports Record Performance in 2023 & Raises Long-Term Guidance

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AES Corporation reports strong financial performance and strategic accomplishments in 2023, including signed contracts for 5.6 GW of renewables and exceeding asset sale targets. Financial highlights include Diluted EPS of $0.34, Net Loss of $182 million, and Adjusted EBITDA of $2,812 million. The company is on track to achieve growth targets through 2027.
Positive
  • AES Corporation achieved significant strategic milestones in 2023, signing contracts for 5.6 GW of renewables and completing construction of 3.5 GW of renewables, doubling new additions compared to the previous year.
  • The company exceeded its asset sale target, securing $1.1 billion in asset sale proceeds, far surpassing the initial goal of $400 to $600 million.
  • Financially, AES reported a Diluted EPS of $0.34, compared to a loss of ($0.82) in 2022, and a Net Loss of $182 million, an improvement from $505 million in 2022.
  • Adjusted EBITDA for 2023 was $2,812 million, slightly lower than the previous year but still within the guided range. The company also achieved growth in Adjusted EPS, reaching $1.76 compared to $1.67 in 2022.
  • AES is optimistic about its future outlook, with plans to add 3.6 GW of new projects in 2024 and signing 14 to 17 GW of new renewable contracts from 2023 to 2025. The company aims for annualized growth of 7% to 9% through 2027.
  • The company's strategic accomplishments include exiting coal generation in various regions, securing grant funding for green hydrogen hubs, and extending gas generation agreements to support grid reliability and decarbonization goals.
Negative
  • None.

The AES Corporation's strategic accomplishments and financial results for the full year 2023 highlight a significant shift in the company's portfolio towards renewable energy. The completion of 3.5 GW of renewables and the signing of new contracts for 5.6 GW are substantial achievements that demonstrate AES's commitment to expanding its renewable energy footprint. This aligns with global trends towards sustainable energy sources and may position AES favorably in markets increasingly sensitive to environmental, social and governance (ESG) factors.

The reported net loss of $182 million, despite being an improvement from the previous year's $505 million loss, suggests ongoing challenges in the company's transition away from coal-fired generation, as indicated by the $1.1 billion in impairments. However, the increase in Adjusted EBITDA with Tax Attributes to $3,423 million reflects the strategic value of tax credits and depreciation deductions in the renewable energy sector. These financial indicators are critical for stakeholders to assess the company's health and strategic direction.

The increase in Diluted EPS to $0.34 from a negative EPS in the previous year indicates a positive turnaround in profitability on a per-share basis, which may attract investor attention. The EPS improvement is primarily attributed to lower goodwill impairments and higher contributions from renewable projects. The forward-looking Adjusted EPS guidance for 2024 and raised growth targets suggest management's confidence in the company's strategic plan and its execution.

Investors should note the company's asset sales exceeding targets, generating $1.1 billion, which could be a strategic move to streamline operations and focus on more profitable segments. The ability to exceed asset sale targets by such a margin may also signal strong market demand for energy assets, which could benefit AES in future divestitures.

The AES Corporation's reaffirmation of annualized growth targets and the upward revision for the period through 2027 reflects optimism in the company's operational capabilities and market position. The energy sector is undergoing a significant transformation with increased emphasis on renewables and AES's backlog of 12.3 GW in signed Power Purchase Agreements (PPAs) and its strategic achievements in the renewable space position it well to capitalize on these market dynamics.

Furthermore, the company's financial outlook, with guidance for both Adjusted EBITDA and Adjusted EPS, provides a transparent forecast for investors and analysts. The expected growth in dividends after 2024 also signals a balance between reinvesting in the business and providing shareholder returns. However, stakeholders should consider the potential impacts of foreign currency and commodity price fluctuations on the company's financials, as noted in the guidance assumptions.

Strategic Accomplishments

  • Signed new contracts for 5.6 GW of renewables in full year 2023, marking the third year in a row of adding 5 GW or more to the backlog
  • Completed construction of 3.5 GW of renewables in full year 2023, doubling new additions compared to 2022
  • Secured $1.1 billion in asset sale proceeds, exceeding target of $400 to $600 million

2023 Financial Highlights

  • Diluted EPS of $0.34, compared to ($0.82) in 2022
  • Adjusted EPS1 of $1.76, compared to $1.67 in 2022 and 2023 guidance of $1.65 to $1.75
  • 2023 Net Loss of $182 million, compared to Net Loss of $505 million in 2022
  • 2023 Adjusted EBITDA2 of $2,812 million, compared to $2,931 million in 2022 and 2023 guidance of $2,600 to $2,900 million
    • 2023 Adjusted EBITDA with Tax Attributes2,3 of $3,423 million, compared to $3,198 million in 2022

Financial Position and Outlook

  • With 5.6 GW of signed PPAs in 2023, on track to achieve target of signing 14 to 17 GW in 2023 to 2025
  • Expecting to add 3.6 GW of new projects in 2024
  • Initiating 2024 guidance for Adjusted EPS1 of $1.87 to $1.97
    • Reaffirming annualized growth target of 7% to 9% through 2025, off a base of 2020
    • Raising annualized growth target to 7% to 9% through 2027 from 6% to 8%, off a base of 2023 guidance
  • Initiating 2024 guidance for Adjusted EBITDA2 of $2,600 to $2,900 million
    • Raising annualized growth target2 to 5% to 7% through 2027 from 3% to 5%, off a base of 2023 guidance
    • Expecting 2024 Adjusted EBITDA with Tax Attributes2,3 of $3,550 to $3,950 million

ARLINGTON, Va., Feb. 26, 2024 /PRNewswire/ -- The AES Corporation (NYSE: AES) today reported financial results for the year ended December 31, 2023.

"Overall, 2023 was AES' best year ever in terms of both execution and financial performance.  We exceeded almost all of our strategic objectives, including increasing renewables construction by 100% to 3.5 GW and signing 5.6 GW of new PPAs," said Andrés Gluski, AES President and Chief Executive Officer.  "Our backlog of signed PPAs now stands at 12.3 GW and we continue to see strong and growing demand from our corporate customers, including data center companies.  We are therefore very well-positioned to add 3.6 GW of new capacity to our operating portfolio in 2024 and sign 14 to 17 GW of new renewable contracts from 2023 through 2025."

"I am extremely pleased with our financial results for 2023, which met or exceeded our expectations on all metrics.  We also significantly exceeded our asset sales goal for the year, positioning us very well to support our future growth," said Stephen Coughlin, AES Executive Vice President and Chief Financial Officer.  "Our 2024 targets and our higher long-term growth rates reflect our confidence in our strategy, our leading market position, and our ability to continue executing on our plan."

2023 Financial Results

Full year 2023 Net Income (Loss) was ($182) million, including $1.1 billion of impairments in 2023 primarily related to the Company's continued exit from coal-fired generation.  This represents an improvement of $323 million compared to full year 2022, primarily due to favorable contributions at the Utilities, New Energy Technologies, and Renewables Strategic Business Units (SBU), partially offset by lower contributions from LNG transactions as compared to 2022 at the Energy Infrastructure SBU.

Full year 2023 Adjusted EBITDA4 (a non-GAAP financial measure) was $2,812 million, a decrease of $119 million compared to full year 2022, primarily driven by lower contributions from the Energy Infrastructure SBU, partially offset by contributions from new renewables projects and the 2023 recovery of AES Ohio purchased power costs recognized in 2022.

During full year 2023, the Company realized Tax Attributes5 of $611 million, an increase of $344 million compared to full year 2022.

Full year 2023 Diluted Earnings Per Share from Continuing Operations (Diluted EPS) was $0.34, an increase of $1.16 compared to full year 2022, primarily reflecting lower goodwill impairments in 2023, higher contributions from renewables projects placed into service, gain on sale of shares in Fluence in 2023, and higher contributions at the Utilities SBU due to the 2023 recovery of AES Ohio purchased power costs recognized in 2022.  These positive drivers were partially offset by lower contributions from LNG transactions versus 2022, and higher unrealized foreign currency losses at the Energy Infrastructure SBU.

Full year 2023 Adjusted Earnings Per Share6 (Adjusted EPS, a non-GAAP financial measure) was $1.76, an increase of $0.09 compared to full year 2022, primarily driven by contributions from new renewables projects and the 2023 recovery of AES Ohio purchased power costs recognized in 2022, partially offset by lower contributions from the Energy Infrastructure SBU and higher Parent Company interest.

Strategic Accomplishments

  • As of today, the Company's backlog, which consists of projects with signed contracts, but which are not yet operational, is 12.3 GW, including 5.1 GW under construction.
  • In 2023, the Company completed the construction of 3.5 GW of solar, wind and energy storage.
  • In 2023, the Company signed 5.6 GW of long-term contracts for new renewables.
  • AES Indiana reached a unanimous settlement agreement for its first rate case since 2018, and expects to receive approval from the Indiana Utility Regulatory Commission (IURC) by the middle of 2024.
  • AES Ohio received approval from the Public Utilities Commission of Ohio (PUCO) for its Electric Security Plan (ESP4), providing the regulatory foundation necessary to enable future investments.
  • Exited, or announced the sale or closure of, 2.1 GW of coal generation in Vietnam, the United States and Chile.
  • Signed agreements for three-year extensions of 1.4 GW of gas generation at the Southland legacy units in Southern California. These extensions will help meet the State of California's grid reliability needs while supporting its decarbonization goals.
  • Awarded up to $2.4 billion of grant funding by the US Department of Energy for two green hydrogen hubs with AES participation.
  • Secured $1.1 billion in asset sale proceeds, to accelerate portfolio transformation, outpacing target of $400 to $600 million.

Guidance and Expectations7,8

The Company is raising its expectation for annualized growth in Adjusted EBITDA7 to 5% to 7% from 3% to 5% through 2027, from a base of its 2023 guidance of $2,600 to $2,900 million.

The Company is initiating 2024 guidance for Adjusted EBITDA7 of $2,600 to $2,900 million.  Results are expected to be driven by the impacts from significant asset sales closed in 2023 and expected to close in 2024, as well as prior year margins earned on LNG transactions, partially offset by contributions from new renewables projects, improved margins in Chile, and rate base growth at US utilities.

The Company is reaffirming its annualized growth target for Adjusted EPS9 of 7% to 9% through 2025, from a base of 2020.  The Company is also raising its annualized growth target for Adjusted EPS7 to 7% to 9% from 6% to 8% through 2027, from a base of its 2023 guidance of $1.65 to $1.75

The Company is initiating 2024 guidance for Adjusted EPS9 of $1.87 to $1.97.  Growth in 2024 is expected to be primarily driven by new renewables commissionings, rate base growth at US utilities, and improved margins in Chile, but partially offset by asset sales and prior year margins on LNG transactions.

The Company's 2024 guidance is based on foreign currency and commodity forward curves as of December 31, 2023.

The Company expects to grow its dividend by 2% to 3% annually after 2024, reflecting a larger pool of attractive investment opportunities and to minimize equity issuance as a source of capital.

Non-GAAP Financial Measures

See Non-GAAP Measures for definitions of Adjusted EBITDA, Adjusted EBITDA with Tax Attributes, Tax Attributes, Adjusted Earnings Per Share and Adjusted Pre-Tax Contribution, as well as reconciliations to the most comparable GAAP financial measures.

Attachments

Condensed Consolidated Statements of Operations, Segment Information, Condensed Consolidated Balance Sheets, Condensed Consolidated Statements of Cash Flows, Non-GAAP Financial Measures and Parent Financial Information.

Conference Call Information

AES will host a conference call on Tuesday, February 27, 2024 at 10:00 a.m. Eastern Time (ET).  Interested parties may listen to the teleconference by dialing 1-833-470-1428 at least ten minutes before the start of the call. International callers should dial +1-404-975-4839.  The Participant Access Code for this call is 958499.  Internet access to the conference call and presentation materials will be available on the AES website at www.aes.com by selecting "Investors" and then "Presentations and Webcasts."

A webcast replay will be accessible at www.aes.com beginning shortly after the completion of the call.

_________________________

1

Adjusted EPS is a non-GAAP financial measure.  See attached "Non-GAAP Measures" for definition of Adjusted EPS and a description of the adjustments to reconcile Adjusted EPS to Diluted EPS for the quarter and twelve months ended December 31, 2023.  The Company is not able to provide a corresponding GAAP equivalent or reconciliation for its Adjusted EPS guidance without unreasonable effort.

2

Adjusted EBITDA is a non-GAAP financial measure.  See attached "Non-GAAP Measures" for definition of Adjusted EBITDA and a description of the adjustments to reconcile Adjusted EBITDA to Net Income (Loss) for the quarter and twelve months ended December 31, 2023.  The Company is not able to provide a corresponding GAAP equivalent or reconciliation for its Adjusted EBITDA guidance without unreasonable effort.

3

Pre-tax effect of Production Tax Credits, Investment Tax Credits, and depreciation tax deductions allocated to tax equity investors, as well as the tax benefit recorded from tax credits retained or transferred to third parties.

4

Adjusted EBITDA is a non-GAAP financial measure.  See attached "Non-GAAP Measures" for definition of Adjusted EBITDA and a description of the adjustments to reconcile Adjusted EBITDA to Net Income (Loss) for the quarter and twelve months ended December 31, 2023.  The Company is not able to provide a corresponding GAAP equivalent or reconciliation for its Adjusted EBITDA guidance without unreasonable effort.

5

Pre-tax effect of Production Tax Credits, Investment Tax Credits, and depreciation tax deductions allocated to tax equity investors, as well as the tax benefit recorded from tax credits retained or transferred to third parties.

6

Adjusted EPS is a non-GAAP financial measure.  See attached "Non-GAAP Measures" for definition of Adjusted EPS and a description of the adjustments to reconcile Adjusted EPS to Diluted EPS for the quarter and twelve months ended December 31, 2023.  The Company is not able to provide a corresponding GAAP equivalent or reconciliation for its Adjusted EPS guidance without unreasonable effort.

7

Adjusted EBITDA is a non-GAAP financial measure.  See attached "Non-GAAP Measures" for definition of Adjusted EBITDA and a description of the adjustments to reconcile Adjusted EBITDA to Net Income (Loss) for the quarter and twelve months ended December 31, 2023.  The Company is not able to provide a corresponding GAAP equivalent or reconciliation for its Adjusted EBITDA guidance without unreasonable effort.

8

Adjusted EPS is a non-GAAP financial measure.  See attached "Non-GAAP Measures" for definition of Adjusted EPS and a description of the adjustments to reconcile Adjusted EPS to Diluted EPS for the quarter and twelve months ended December 31, 2023.  The Company is not able to provide a corresponding GAAP equivalent or reconciliation for its Adjusted EPS guidance without unreasonable effort.

9

Adjusted EPS is a non-GAAP financial measure.  See attached "Non-GAAP Measures" for definition of Adjusted EPS and a description of the adjustments to reconcile Adjusted EPS to Diluted EPS for the quarter and twelve months ended December 31, 2023.  The Company is not able to provide a corresponding GAAP equivalent or reconciliation for its Adjusted EPS guidance without unreasonable effort.

 

About AES

The AES Corporation (NYSE: AES) is a Fortune 500 global energy company accelerating the future of energy.  Together with our many stakeholders, we're improving lives by delivering the greener, smarter energy solutions the world needs.  Our diverse workforce is committed to continuous innovation and operational excellence, while partnering with our customers on their strategic energy transitions and continuing to meet their energy needs today.  For more information, visit www.aes.com

Safe Harbor Disclosure

This news release contains forward-looking statements within the meaning of the Securities Act of 1933 and of the Securities Exchange Act of 1934. Such forward-looking statements include, but are not limited to, those related to future earnings, growth and financial and operating performance. Forward-looking statements are not intended to be a guarantee of future results, but instead constitute AES' current expectations based on reasonable assumptions. Forecasted financial information is based on certain material assumptions. These assumptions include, but are not limited to, our expectations regarding accurate projections of future interest rates, commodity price and foreign currency pricing, continued normal levels of operating performance and electricity volume at our distribution companies and operational performance at our generation businesses consistent with historical levels, as well as the execution of PPAs, conversion of our backlog and growth investments at normalized investment levels, and rates of return consistent with prior experience.

Actual results could differ materially from those projected in our forward-looking statements due to risks, uncertainties and other factors. Important factors that could affect actual results are discussed in AES' filings with the Securities and Exchange Commission (the "SEC"), including, but not limited to, the risks discussed under Item 1A: "Risk Factors" and Item 7: "Management's Discussion & Analysis" in AES' 2023 Annual Report on Form 10-K and in subsequent reports filed with the SEC. Readers are encouraged to read AES' filings to learn more about the risk factors associated with AES' business. AES undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except where required by law.

Any Stockholder who desires a copy of the Company's 2023 Annual Report on Form 10-K filed February 26, 2024 with the SEC may obtain a copy (excluding the exhibits thereto) without charge by addressing a request to the Office of the Corporate Secretary, The AES Corporation, 4300 Wilson Boulevard, Arlington, Virginia 22203. Exhibits also may be requested, but a charge equal to the reproduction cost thereof will be made. A copy of the Annual Report on Form 10-K may be obtained by visiting the Company's website at www.aes.com.

Website Disclosure

AES uses its website, including its quarterly updates, as channels of distribution of Company information.  The information AES posts through these channels may be deemed material.  Accordingly, investors should monitor our website, in addition to following AES' press releases, quarterly SEC filings and public conference calls and webcasts.  In addition, you may automatically receive e-mail alerts and other information about AES when you enroll your e-mail address by visiting the "Subscribe to Alerts" page of AES' Investors website.  The contents of AES' website, including its quarterly updates, are not, however, incorporated by reference into this release.

 

THE AES CORPORATION

Consolidated Statements of Operations



Year Ended December 31,


2023


2022


2021


(in millions, except per share amounts)

Revenue:






Non-Regulated

$         9,245


$         9,079


$         8,273

Regulated

3,423


3,538


2,868

Total revenue

12,668


12,617


11,141

Cost of Sales:






Non-Regulated

(7,173)


(6,907)


(5,982)

Regulated

(2,991)


(3,162)


(2,448)

Total cost of sales

(10,164)


(10,069)


(8,430)

Operating margin

2,504


2,548


2,711

General and administrative expenses

(255)


(207)


(166)

Interest expense

(1,319)


(1,117)


(911)

Interest income

551


389


298

Loss on extinguishment of debt

(63)


(15)


(78)

Other expense

(99)


(68)


(60)

Other income

89


102


410

Gain (loss) on disposal and sale of business interests

134


(9)


(1,683)

Goodwill impairment expense

(12)


(777)


Asset impairment expense

(1,067)


(763)


(1,575)

Foreign currency transaction losses

(359)


(77)


(10)

Other non-operating expense


(175)


INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE TAXES AND EQUITY IN EARNINGS OF AFFILIATES

104


(169)


(1,064)

Income tax benefit (expense)

(261)


(265)


133

Net equity in losses of affiliates

(32)


(71)


(24)

LOSS FROM CONTINUING OPERATIONS

(189)


(505)


(955)

Gain from disposal of discontinued businesses, net of income tax benefit (expense) of $7, $0, and $-1, respectively

7



4

NET LOSS

(182)


(505)


(951)

Less: Net loss (income) attributable to noncontrolling interests and redeemable stock of subsidiaries

431


(41)


542

NET INCOME (LOSS) ATTRIBUTABLE TO THE AES CORPORATION

$            249


$          (546)


$          (409)

AMOUNTS ATTRIBUTABLE TO THE AES CORPORATION COMMON STOCKHOLDERS:






Income (loss) from continuing operations, net of tax

$            242


$          (546)


$          (413)

Income from discontinued operations, net of tax

7



4

NET INCOME (LOSS) ATTRIBUTABLE TO THE AES CORPORATION

$            249


$          (546)


$          (409)

BASIC EARNINGS PER SHARE:






Income (loss) from continuing operations attributable to The AES Corporation common stockholders, net of tax

$           0.36


$         (0.82)


$         (0.62)

Income from discontinued operations attributable to The AES Corporation common stockholders, net of tax

0.01



0.01

NET INCOME (LOSS) ATTRIBUTABLE TO THE AES CORPORATION COMMON STOCKHOLDERS

$           0.37


$         (0.82)


$         (0.61)

DILUTED EARNINGS PER SHARE:






Income (loss) from continuing operations attributable to The AES Corporation common stockholders, net of tax

$           0.34


$         (0.82)


$         (0.62)

Income from discontinued operations attributable to The AES Corporation common stockholders, net of tax

0.01



0.01

NET INCOME (LOSS) ATTRIBUTABLE TO THE AES CORPORATION COMMON STOCKHOLDERS

$           0.35


$         (0.82)


$         (0.61)

 

THE AES CORPORATION

Consolidated Statements of Operations (Unaudited)




Three Months Ended December 31,



2023


2022



(in millions, except per share amounts)

Revenue:





Non-Regulated


$                     2,194


$                     2,135

Regulated


774


925

Total revenue


2,968


3,060

Cost of Sales:





Non-Regulated


(1,781)


(1,670)

Regulated


(693)


(827)

Total cost of sales


(2,474)


(2,497)

Operating margin


494


563

General and administrative expenses


(64)


(58)

Interest expense


(353)


(304)

Interest income


153


119

Loss on extinguishment of debt


(62)


(7)

Other expense


(61)


(17)

Other income


53


22

Loss on disposal and sale of business interests


138


(9)

Goodwill impairment expense


(12)


(777)

Asset impairment expense


(715)


(230)

Foreign currency transaction losses


(150)


(17)

Other non-operating expense



(175)

INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE TAXES AND EQUITY IN EARNINGS OF AFFILIATES


(579)


(890)

Income tax benefit (expense)


(82)


(79)

Net equity in losses of affiliates


11


(17)

LOSS FROM CONTINUING OPERATIONS


(650)


(986)

Gain (loss) from disposal and impairments of discontinued businesses


7


NET LOSS


(643)


(986)

Less: Net loss (income) attributable to noncontrolling interests and redeemable stock of subsidiaries


549


83

NET INCOME (LOSS) ATTRIBUTABLE TO THE AES CORPORATION


$                        (94)


$                      (903)

AMOUNTS ATTRIBUTABLE TO THE AES CORPORATION COMMON STOCKHOLDERS:





BASIC EARNINGS PER SHARE:





Income (loss) from continuing operations attributable to The AES Corporation common stockholders, net of tax


$                     (0.15)


$                     (1.35)

Income from discontinued operations attributable to The AES Corporation common stockholders, net of tax


0.01


NET INCOME (LOSS) ATTRIBUTABLE TO THE AES CORPORATION COMMON STOCKHOLDERS


$                     (0.14)


$                     (1.35)

DILUTED EARNINGS PER SHARE:





Income (loss) from continuing operations attributable to The AES Corporation common stockholders, net of tax


$                     (0.15)


$                     (1.35)

Income from discontinued operations attributable to The AES Corporation common stockholders, net of tax


0.01


NET INCOME (LOSS) ATTRIBUTABLE TO THE AES CORPORATION COMMON STOCKHOLDERS


$                     (0.14)


$                     (1.35)

DILUTED SHARES OUTSTANDING


670


668

 

THE AES CORPORATION

Strategic Business Unit (SBU) Information

(Unaudited)






Three Months Ended
December 31,


Year Ended
December 31,

(in millions)

2023


2022


2023


2022

REVENUE








Renewables SBU

$              595


$              486


$           2,339


$           1,893

Utilities SBU

792


943


3,495


3,617

Energy Infrastructure SBU

1,597


1,651


6,836


7,204

New Energy Technologies SBU

1


1


76


3

Corporate and Other

42


35


138


116

Eliminations

(59)


(56)


(216)


(216)

Total Revenue

$           2,968


$           3,060


$         12,668


$         12,617

 

THE AES CORPORATION

Consolidated Balance Sheets



December 31, 2023


December 31, 2022


(in millions, except share and per share data)

ASSETS




CURRENT ASSETS




Cash and cash equivalents

$               1,426


$               1,374

Restricted cash

370


536

Short-term investments

395


730

Accounts receivable, net of allowance of $15 and $5, respectively

1,420


1,799

Inventory

712


1,055

Prepaid expenses

177


98

Other current assets, net of allowance of $0 and $2, respectively

1,387


1,533

Current held-for-sale assets

762


518

Total current assets

6,649


7,643

NONCURRENT ASSETS




Property, Plant and Equipment:




Land

522


470

Electric generation, distribution assets and other

30,190


26,599

Accumulated depreciation

(8,602)


(8,651)

Construction in progress

7,848


4,621

Property, plant and equipment, net

29,958


23,039

Other Assets:




Investments in and advances to affiliates

941


952

Debt service reserves and other deposits

194


177

Goodwill

348


362

Other intangible assets, net of accumulated amortization of $498 and $434, respectively

2,243


1,841

Deferred income taxes

396


319

Other noncurrent assets, net of allowance of $9 and $77, respectively

3,259


4,030

Noncurrent held-for-sale assets

811


Total other assets

8,192


7,681

TOTAL ASSETS

$             44,799


$             38,363

LIABILITIES AND EQUITY




CURRENT LIABILITIES




Accounts payable

$               2,199


$               1,730

Accrued interest

315


249

Accrued non-income taxes

278


249

Supplier financing arrangements

974


662

Accrued and other liabilities

1,334


1,489

Recourse debt

200


Non-recourse debt, including $1080 and $416, respectively, related to variable interest entities

3,932


1,758

Current held-for-sale liabilities

499


354

Total current liabilities

9,731


6,491

NONCURRENT LIABILITIES




Recourse debt

4,264


3,894

Non-recourse debt, including $1,715 and $2,295, respectively, related to variable interest entities

18,482


17,846

Deferred income taxes

1,245


1,139

Other noncurrent liabilities

3,114


3,168

Noncurrent held-for-sale liabilities

514


Total noncurrent liabilities

27,619


26,047

Redeemable stock of subsidiaries

1,464


1,321

EQUITY




THE AES CORPORATION STOCKHOLDERS' EQUITY




Preferred stock (without par value, 50,000,000 shares authorized; 1,043,050 issued and outstanding at
December 31, 2023 and December 31, 2022)

838


838

Common stock ($0.01 par value, 1,200,000,000 shares authorized; 819,051,591 issued and 669,693,234
outstanding at December 31, 2023 and 818,790,001 issued and 668,743,464 outstanding at December 31, 2022)

8


8

Additional paid-in capital

6,355


6,688

Accumulated deficit

(1,386)


(1,635)

Accumulated other comprehensive loss

(1,514)


(1,640)

Treasury stock, at cost (149,358,357 and 150,046,537 shares, respectively)

(1,813)


(1,822)

Total AES Corporation stockholders' equity

2,488


2,437

NONCONTROLLING INTERESTS

3,497


2,067

Total equity

5,985


4,504

TOTAL LIABILITIES AND EQUITY

$             44,799


$             38,363

 

THE AES CORPORATION

Consolidated Statements of Cash Flows

(Unaudited)



Three Months Ended
December 31,


Year Ended
December 31,


2023


2022


2023


2022

OPERATING ACTIVITIES:

(in millions)


(in millions)

Net loss

$       (643)


$       (986)


$       (182)


$       (505)

Adjustments to net loss:








Depreciation and amortization

292


253


1,128


1,053

Emissions allowance expense

53


106


264


425

Loss (gain) on realized/unrealized derivatives

64


63


143


127

Gain on remeasurement to acquisition date fair value


(5)



(5)

Loss (gain) on disposal and sale of business interests

(138)


9


(134)


9

Impairment expense

721


1,182


1,079


1,715

Loss on realized/unrealized foreign currency

147


13


331


58

Deferred income taxes

48


4


(54)


4

Other

31


110


149


123

Changes in operating assets and liabilities:








(Increase) decrease in accounts receivable

145


(123)


161


(532)

(Increase) decrease in inventory

53


(56)


306


(417)

(Increase) decrease in prepaid expenses and other current assets

(38)


76


38


(40)

(Increase) decrease in other assets

9


182


5


433

Increase (decrease) in accounts payable and other current liabilities

55


362


(132)


470

Increase (decrease) in income tax payables, net and other tax payables

(42)


80


(109)


(51)

Increase (decrease) in deferred income

(52)


(15)


(2)


33

Increase (decrease) in other liabilities

20


(189)


43


(185)

Net cash provided by operating activities

725


1,066


3,034


2,715

INVESTING ACTIVITIES:








Capital expenditures

(2,429)


(1,840)


(7,724)


(4,551)

Acquisitions of business interests, net of cash and restricted cash acquired

(231)


(129)


(542)


(243)

Proceeds from the sale of business interests, net of cash and restricted cash sold

156



254


1

Sale of short-term investments

316


395


1,318


1,049

Purchase of short-term investments

(173)


(401)


(937)


(1,492)

Contributions and loans to equity affiliates

(31)


(30)


(178)


(232)

Affiliate repayments and returns of capital

5


78


5


149

Purchase of emissions allowances

(107)


(73)


(268)


(488)

Other investing

(21)


(11)


(116)


(29)

Net cash used in investing activities

(2,515)


(2,011)


(8,188)


(5,836)

FINANCING ACTIVITIES:








Borrowings under the revolving credit facilities

3,164


1,210


7,103


5,424

Repayments under the revolving credit facilities

(3,555)


(1,905)


(6,285)


(4,687)

Commercial paper borrowings (repayments), net

(604)




Issuance of recourse debt



1,400


200

Repayments of recourse debt

(500)



(500)


(29)

Issuance of non-recourse debt

2,737


2,234


4,521


5,788

Repayments of non-recourse debt

(1,233)


(1,372)


(2,495)


(3,144)

Payments for financing fees

(66)


(37)


(142)


(120)

Purchases under supplier financing arrangements

551


743


1,858


1,042

Repayments of obligations under supplier financing arrangements

(392)


(198)


(1,491)


(432)

Distributions to noncontrolling interests

(150)


(136)


(323)


(265)

Acquisitions of noncontrolling interests

(115)


(61)


(127)


(602)

Contributions from noncontrolling interests

39


111


102


233

Sales to noncontrolling interests

1,567


406


1,938


742

Issuance of preferred shares in subsidiaries

418



421


60

Dividends paid on AES common stock

(111)


(106)


(444)


(422)

Payments for financed capital expenditures

(2)


(10)


(10)


(33)

Other financing

(83)


16


(121)


3

Net cash provided by financing activities

1,665


895


5,405


3,758

Effect of exchange rate changes on cash, cash equivalents and restricted cash

(162)


(12)


(270)


(56)

(Increase) decrease in cash, cash equivalents and restricted cash of held-for-sale businesses

(58)


115


(78)


22

Total increase (decrease) in cash, cash equivalents and restricted cash

(345)


53


(97)


603

Cash, cash equivalents and restricted cash, beginning

2,335


2,034


2,087


1,484

Cash, cash equivalents and restricted cash, ending

$      1,990


$      2,087


$      1,990


$      2,087

SUPPLEMENTAL DISCLOSURES:








Cash payments for interest, net of amounts capitalized

$         582


$         274


$      1,317


$         928

Cash payments for income taxes, net of refunds

34


68


301


271

SCHEDULE OF NONCASH INVESTING AND FINANCING ACTIVITIES:








Initial recognition of contingent consideration for acquisitions (see Note 25)

24


9


239


24

Noncash recognition of new operating and financing leases (see Note 14)

38


5


225


134

Dividends declared but not yet paid

116


111


116


111

Noncash contributions from noncontrolling interests



60


Noncash contributions to equity affiliates from transfers of tax credits

52



52


 

THE AES CORPORATION
NON-GAAP FINANCIAL MEASURES
(Unaudited)
RECONCILIATION OF ADJUSTED PRE-TAX CONTRIBUTION (PTC) AND ADJUSTED EPS

EBITDA is defined as earnings before interest income and expense, taxes, depreciation, and amortization. We define Adjusted EBITDA as EBITDA adjusted for the impact of NCI and interest, taxes, depreciation, and amortization of our equity affiliates, adding back interest income recognized under service concession arrangements, and excluding gains or losses of both consolidated entities and entities accounted for under the equity method due to (a) unrealized gains or losses related to derivative transactions and equity securities; (b) unrealized foreign currency gains or losses; (c) gains, losses, benefits and costs associated with dispositions and acquisitions of business interests, including early plant closures, and gains and losses recognized at commencement of sales-type leases; (d) losses due to impairments; (e) gains, losses and costs due to the early retirement of debt; and (f) net gains at Angamos, one of our businesses in the Energy Infrastructure SBU, associated with the early contract terminations with Minera Escondida and Minera Spence. Adjusted EBITDA with Tax Attributes is defined as Adjusted EBITDA, adding back the pre-tax effect of Production Tax Credits ("PTCs"), Investment Tax Credits ("ITCs"), and depreciation tax deductions allocated to tax equity investors, as well as the tax benefit recorded from tax credits retained or transferred to third parties.

The GAAP measure most comparable to EBITDA, Adjusted EBITDA, and Adjusted EBITDA with Tax Attributes is Net income. We believe that EBITDA, Adjusted EBITDA, and Adjusted EBITDA with Tax Attributes better reflect the underlying business performance of the Company. Adjusted EBITDA is the most relevant measure considered in the Company's internal evaluation of the financial performance of its segments. Factors in this determination include the variability due to unrealized gains or losses related to derivative transactions or equity securities remeasurement, unrealized foreign currency gains or losses, losses due to impairments, strategic decisions to dispose of or acquire business interests or retire debt, the non-recurring nature of the impact of the early contract terminations at Angamos, and the variability of allocations of earnings to tax equity investors, which affect results in a given period or periods. In addition, each of these metrics represent the business performance of the Company before the application of statutory income tax rates and tax adjustments, including the effects of tax planning, corresponding to the various jurisdictions in which the Company operates. Given its large number of businesses and overall complexity, the Company concluded that Adjusted EBITDA is a more transparent measure than Net income that better assists investors in determining which businesses have the greatest impact on the Company's results.

EBITDA, Adjusted EBITDA, and Adjusted EBITDA with Tax Attributes should not be construed as alternatives to Net income, which is determined in accordance with GAAP.


Three Months Ended December 31,


Twelve Months Ended December 31,

Reconciliation of Adjusted EBITDA (in millions)

2023


2022


2023


2022

Net loss

$               (643)


$               (986)


$               (182)


$               (505)

Income tax expense

82


79


261


265

Interest expense

353


304


1,319


1,117

Interest income

(153)


(119)


(551)


(389)

Depreciation and amortization

292


253


1,128


1,053

EBITDA

$                 (69)


$               (469)


$              1,975


$              1,541

Less: Income from discontinued operations

(7)



(7)


Less: Adjustment for noncontrolling interests and redeemable stock of subsidiaries (1)

(44)


(218)


(552)


(704)

Less: Income tax expense (benefit), interest expense (income) and depreciation and
amortization from equity affiliates

37


33


130


126

Interest income recognized under service concession arrangements

17


19


71


77

Unrealized derivative and equity securities losses

31


131


34


131

Unrealized foreign currency losses

140


19


301


42

Disposition/acquisition losses (gains)

(100)


4


(79)


40

Impairment losses

559


1,161


877


1,658

Loss on extinguishment of debt

61


13


62


20

Adjusted EBITDA (1)

$                 625


$                 693


$              2,812


$              2,931

Tax attributes

542


158


611


267

Adjusted EBITDA with Tax Attributes (2)

$              1,167


$                 851


$              3,423


$              3,198

_____________________________

(1) 

The allocation of earnings to tax equity investors from both consolidated entities and equity affiliates is removed from Adjusted EBITDA.

(2)  

Adjusted EBITDA with Tax Attributes includes the impact of the share of the ITCs, PTCs, and depreciation deductions allocated to tax equity investors under the HLBV accounting method and recognized as Net loss attributable to noncontrolling interests and redeemable stock of subsidiaries on the Condensed Consolidated Statements of Operations. It also includes the tax benefit recorded from tax credits retained or transferred directly to third parties. The tax attributes are related to the Renewables and Utilities SBUs.

Adjusted PTC, a non-GAAP measure, is defined by the Company as pre-tax income from continuing operations attributable to The AES Corporation excluding gains or losses of the consolidated entity due to (a) unrealized gains or losses related to derivative transactions and equity securities; (b) unrealized foreign currency gains or losses; (c) gains, losses, benefits and costs associated with dispositions and acquisitions of business interests, including early plant closures, and gains and losses recognized at commencement of sales-type leases; (d) losses due to impairments; (e) gains, losses and costs due to the early retirement of debt; and (f) net gains at Angamos, one of our businesses in the Energy Infrastructure SBU, associated with the early contract terminations with Minera Escondida and Minera Spence. Adjusted PTC also includes net equity in earnings of affiliates on an after-tax basis adjusted for the same gains or losses excluded from consolidated entities.

Adjusted EPS, a non-GAAP measure, is defined by the Company as diluted earnings per share from continuing operations excluding gains or losses of both consolidated entities and entities accounted for under the equity method due to (a) unrealized gains or losses related to derivative transactions and equity securities; (b) unrealized foreign currency gains or losses; (c) gains, losses, benefits and costs associated with dispositions and acquisitions of business interests, including early plant closures, the tax impact from the repatriation of sales proceeds, and gains and losses recognized at commencement of sales-type leases; (d) losses due to impairments; (e) gains, losses and costs due to the early retirement of debt; and (f) net gains at Angamos, one of our businesses in the Energy Infrastructure SBU, associated with the early contract terminations with Minera Escondida and Minera Spence.

The GAAP measure most comparable to Adjusted PTC is income from continuing operations attributable to The AES Corporation. The GAAP measure most comparable to Adjusted EPS is diluted earnings per share from continuing operations. We believe that Adjusted PTC and Adjusted EPS better reflect the underlying business performance of the Company and are considered in the Company's internal evaluation of financial performance. Factors in this determination include the variability due to unrealized gains or losses related to derivative transactions or equity securities remeasurement, unrealized foreign currency gains or losses, losses due to impairments, strategic decisions to dispose of or acquire business interests or retire debt, and the non-recurring nature of the impact of the early contract terminations at Angamos, and for Adjusted EPS, the one-time impact of the 2017 U.S. tax law reform and subsequent period adjustments related to enactment effects, which affect results in a given period or periods. In addition, for Adjusted PTC, earnings before tax represents the business performance of the Company before the application of statutory income tax rates and tax adjustments, including the effects of tax planning, corresponding to the various jurisdictions in which the Company operates. Adjusted PTC and Adjusted EPS should not be construed as alternatives to income from continuing operations attributable to The AES Corporation and diluted earnings per share from continuing operations, which are determined in accordance with GAAP.

Reconciliation of GAAP to Non-GAAP Diluted Loss per Share

Three Months Ended December 31,


Twelve Months Ended December 31,


2022


2022

GAAP DILUTED LOSS PER SHARE

$                                            (1.35)


$                                            (0.82)

EFFECT OF DILUTIVE SECURITIES




Restricted stock units


Equity units

0.08


0.05

NON-GAAP DILUTED LOSS PER SHARE

$                                            (1.27)


$                                            (0.77)

 


Three Months Ended
December 31, 2023


Three Months Ended
December 31, 2022


Twelve Months Ended
December 31, 2023


Twelve Months Ended
December 31, 2022



Net of N4CI (1)


Per Share
(Diluted) Net
of NCI (1)


Net of NCI (1)


Per Share
(Diluted) Net
of NCI (1)


Net of NCI (1)


Per Share
(Diluted) Net
of NCI (1)


Net of NCI (1)


Per Share
(Diluted) Net
of NCI (1)



(in millions, except per share amounts)


Income (loss) from continuing
operations, net of tax, attributable
to AES and Diluted
EPS

$     (101)


$    (0.14)


$     (903)


$    (1.27)


$       242


$      0.34


$     (546)


$    (0.77)


Income tax expense from continuing
operations attributable to AES

70




61




206




210




Pre-tax contribution

$       (31)




$     (842)




$       448




$     (336)




Adjustments

















Unrealized derivative and equity
securities losses

$         38


$      0.05

(2)

$       130


$      0.18

(3)

$         41


$      0.06

(4)

$       128


$      0.18

(5)

Unrealized foreign currency losses

141


0.20

(6)

19


0.03

(7)

301


0.42

(8)

42


0.07

(9)

Disposition/acquisition losses (gains)

(100)


(0.14)

(10)

4


0.01


(79)


(0.11)

(11)

40


0.06

(12)

Impairment losses

559


0.78

(13)

1,161


1.63

(14)

877


1.23

(15)

1,658


2.33

(16)

Loss on extinguishment of debt

63


0.09

(17)

15


0.02

(18)

70


0.10

(19)

35


0.05

(20)

Less: Net income tax benefit



(0.11)

(21)



(0.11)

(22)



(0.28)

(23)



(0.25)

(24)

Adjusted PTC and Adjusted EPS

$       670


$      0.73


$       487


$      0.49


$    1,658


$      1.76


$    1,567


$      1.67


_____________________________

(1)  

NCI is defined as Noncontrolling Interests.



(2)        

Amount primarily relates to unrealized derivative losses at the Energy Infrastructure SBU of $24 million, or $0.03 per share and unrealized derivative losses at the Parent Company of $15 million, or $0.02 per share.



(3)  

Amount primarily relates to unrealized losses on power swaps at Southland Energy of $97 million, or $0.14 per share. 



(4)        

Amount primarily relates to unrealized derivative losses due to the termination of a PPA of $72 million, or $0.10 per share and net unrealized derivative losses at AES Clean Energy of $20 million, or $0.03 per share, offset by net unrealized derivative gains at the Energy Infrastructure SBU of $46 million, or $0.06 per share.



(5)  

Amount primarily relates to unrealized losses on power swaps at Southland Energy of $109 million, or $0.15 per share. 



(6)        

Amount primarily relates to unrealized foreign currency losses in Argentina of $158 million, or $0.22 per share, partially offset by unrealized foreign currency gains at AES Andes of $30 million, or $0.04 per share.



(7)        

Amount primarily relates to unrealized foreign currency losses in Argentina of $20 million, or $0.03 per share, mainly associated with the devaluation of long-term receivables denominated in Argentine pesos.



(8)        

Amount primarily relates to unrealized foreign currency losses in Argentina of $262 million, or $0.37 per share, mainly associated with the devaluation of long-term receivables denominated in Argentine pesos, and unrealized foreign currency losses at AES Andes of $25 million, or $0.03 per share.



(9)        

Amount primarily relates to unrealized foreign currency losses in Argentina of $39 million, or $0.05 per share, mainly associated with the devaluation of long-term receivables denominated in Argentine pesos. 



(10)      

Amount primarily relates to the gain on sale of Fluence shares of $136 million, or $0.19 per share; partially offset by costs due to the early plant closures at Norgener and Ventanas 2 at AES Andes of $30 million, or $0.04 per share and at Warrior Run of $6 million, or $0.01 per share, and day-one losses on commencement of sales-type leases at AES Renewable Holdings of $19 million, or $0.03 per share.



(11)      

Amount primarily relates to the gain on sale of Fluence shares of $136 million, or $0.19 per share, partially offset by costs due to early plant closure at the Ventanas 2 and Norgener coal-fired plants in Chile of $37 million, or $0.05 per share and at Warrior Run of $6 million, or $0.01 per share, and day-one losses recognized at commencement of sales-type leases at AES Renewable Holdings of $20 million, or $0.03 per share.



(12)   

Amount primarily relates to costs on disposition of AES Gilbert, including the recognition of an allowance on the sales-type lease receivable, of $13 million, or $0.02 per share, and a day-one loss recognized at commencement of a sales-type lease at AES Waikoloa Solar of $5 million, or $0.01 per share.



(13)

Amount primarily relates to asset impairments at Warrior Run of $198 million, or $0.28 per share, at New York Wind of $139 million, or $0.20 per share, at AES Clean Energy development projects of $103 million, or $0.14 per share, at Mong Duong of $88 million, or $0.12 per share, and a goodwill impairment at TEG TEP reporting unit of $12 million, or $0.02 per share.



(14)

Amount primarily relates to goodwill impairments at AES Andes of $644 million, or $0.91 per share, and at AES El Salvador of $133 million, or $0.19 per share, other-than-temporary impairment at sPower of $175 million, or $0.25, as well as long-lived asset impairment at TEG TEP of $191 million, or $0.27 per share. 



(15) 

Amount primarily relates to asset impairments at Warrior Run of $198 million, or $0.28 per share, at New York Wind of $139 million, or $0.20 per share, the Norgener coal-fired plant in Chile of $136 million, or $0.19 per share, at TEG and TEP of $76 million and $58 million, respectively, or $0.19 per share, AES Clean Energy development projects of $114 million, or $0.16 per share, at Mong Duong of $88 million, or $0.12 per share, at Jordan of $21 million, or $0.03 per share, and at the GAF Projects at AES Renewable Holdings of $18 million, or $0.03 per share, and a goodwill impairment at the TEG TEP reporting unit of $12 million, or $0.02 per share.



(16) 

Amount primarily relates to goodwill impairments at AES Andes of $644 million, or $0.91 per share, and at AES El Salvador of $133 million, or $0.19 per share, other-than-temporary impairment at sPower of $175 million, or $0.25, as well as long-lived asset impairments at Maritza of $468 million, or $0.66 per share, at TEG TEP of $191 million, or $0.27 per share, and in Jordan of $28 million, or $0.04 per share.



(17)

Amount primarily relates to losses incurred at AES Andes due to early retirement of debt of $46 million, or $0.07 per share, and a loss on early retirement of debt at AES Hispanola Holdings BV of $9 million, or $0.01 per share.



(18) 

Amount primarily relates to losses on early retirement of debt due to refinancing at AES Renewable Holdings of $12 million, or $0.02 per share.



(19)

Amount primarily relates to losses incurred at AES Andes due to early retirement of debt of $46 million, or $0.07 per share, and loss on early retirement of debt at AES Hispanola Holdings BV of $10 million, or $0.01 per share.



(20)  

Amount primarily relates to losses on early retirement of debt due to refinancing at AES Renewable Holdings of $12 million, or $0.02 per share, at AES Clean Energy of $5 million, or $0.01 per share, at Mong Duong of $4 million, or $0.01 per share, and at TEG TEP of $4 million, or $0.01 per share.



(21)

Amount primarily relates to income tax benefits associated with the asset impairments at Warrior Run of $46 million, or $0.06 per share, at New York Wind of $32 million, or $0.05 per share, and at AES Clean Energy development projects of $23 million, or $0.03 per share; and income tax benefits associated with losses incurred at AES Andes due to early retirement of debt of $13 million, or $0.02 per share; partially offset by income tax expense associated with the gain on sale of Fluence shares of $31 million, or $0.04 per share.



(22) 

Amount primarily relates to income tax benefits associated with the impairments at TEG TEP of $57 million, or $0.09 per share, and the income tax benefits associated with the other-than-temporary impairment at sPower of $39 million, or $0.06 per share.



(23) 

Amount primarily relates to income tax benefits associated with the asset impairments at Warrior Run of $46 million, or $0.06 per share, at the Norgener coal-fired plant in Chile of $37 million, or $0.05 per share, at New York Wind of $32 million, or $0.05 per share, at TEG and TEP of $27 million, or $0.04 per share, and at AES Clean Energy development projects of $26 million, or $0.04 per share; income tax benefits associated with the recognition of unrealized losses due to the termination of a PPA of $17 million, or $0.02 per share; and income tax benefits associated with losses incurred at AES Andes due to early retirement of debt of $13 million, or $0.02 per share; partially offset by income tax expense associated with the gain on sale of Fluence shares of $31 million, or $0.04 per share.



(24)

Amount primarily relates to income tax benefits associated with the impairment at Maritza of $48 million, or $0.07 per share, income tax benefits associated with the other-than-temporary impairment at sPower of $39 million, or $0.06 per share, income tax benefits associated with the impairment at TEG TEP of $34 million, or $0.05 per share, and income tax benefits associated with unrealized losses on power swaps at Southland Energy of $24 million, or $0.03 per share.

 

The AES Corporation

Parent Financial Information

Parent only data: last four quarters





(in millions)

4 Quarters Ended

Total subsidiary distributions & returns of capital to Parent

December 31, 2023

September 30, 2023

June 30, 2023

March 31, 2023

Actual

Actual

Actual

Actual

Subsidiary distributions1 to Parent & QHCs

$             1,408

$             1,625

$             1,383

$            1,489

Returns of capital distributions to Parent & QHCs

194

116

56

56

Total subsidiary distributions & returns of capital to Parent

$             1,602

$             1,741

$             1,439

$            1,545

Parent only data: quarterly





(in millions)

Quarter Ended

Total subsidiary distributions & returns of capital to Parent

December 31, 2023

September 30, 2023

June 30, 2023

March 31, 2023

Actual

Actual

Actual

Actual

Subsidiary distributions1 to Parent & QHCs

$                536

$                311

$                205

$               356

Returns of capital distributions to Parent & QHCs

78

60

56

Total subsidiary distributions & returns of capital to Parent

$                614

$                371

$                205

$               412



(in millions)

Balance at


December 31, 2023

September 30, 2023

June 30, 2023

March 31, 2023

Parent Company Liquidity2

Actual

Actual

Actual

Actual

Cash at Parent & Cash at QHCs3

$                  33

$                  51

$                  35

$               117

Availability under credit facilities

1,376

857

883

970

Ending liquidity

$             1,409

$                908

$                918

$            1,087

____________________________

(1)         

Subsidiary distributions received by Qualified Holding Companies ("QHCs") excluded from Schedule 1. Subsidiary Distributions should not be construed as an alternative to Consolidated Net Cash Provided by Operating Activities, which is determined in accordance with US GAAP. Subsidiary Distributions are important to the Parent Company because the Parent Company is a holding company that does not derive any significant direct revenues from its own activities but instead relies on its subsidiaries' business activities and the resultant distributions to fund the debt service, investment and other cash needs of the holding company. The reconciliation of the difference between the Subsidiary Distributions and Consolidated Net Cash Provided by Operating Activities consists of cash generated from operating activities that is retained at the subsidiaries for a variety of reasons which are both discretionary and non-discretionary in nature. These factors include, but are not limited to, retention of cash to fund capital expenditures at the subsidiary, cash retention associated with non-recourse debt covenant restrictions and related debt service requirements at the subsidiaries, retention of cash related to sufficiency of local GAAP statutory retained earnings at the subsidiaries, retention of cash for working capital needs at the subsidiaries, and other similar timing differences between when the cash is generated at the subsidiaries and when it reaches the Parent Company and related holding companies.

(2) 

Parent Company Liquidity is defined as cash available to the Parent Company, including cash at qualified holding companies (QHCs), plus available borrowings under our existing credit facility. AES believes that unconsolidated Parent Company liquidity is important to the liquidity position of AES as a Parent Company because of the non-recourse nature of most of AES' indebtedness.

(3)        

The cash held at QHCs represents cash sent to subsidiaries of the company domiciled outside of the US. Such subsidiaries have no contractual restrictions on their ability to send cash to AES, the Parent Company. Cash at those subsidiaries was used for investment and related activities outside of the US. These investments included equity investments and loans to other foreign subsidiaries as well as development and general costs and expenses incurred outside the US. Since the cash held by these QHCs is available to the Parent, AES uses the combined measure of subsidiary distributions to Parent and QHCs as a useful measure of cash available to the Parent to meet its international liquidity needs.

Investor Contact: Susan Harcourt 703-682-1204, susan.harcourt@aes.com
Media Contact: Amy Ackerman 703-682-6399, amy.ackerman@aes.com

Cision View original content to download multimedia:https://www.prnewswire.com/news-releases/aes-reports-record-performance-in-2023--raises-long-term-guidance-302071731.html

SOURCE The AES Corporation

FAQ

What were AES Corporation's financial highlights for 2023?

AES Corporation reported a Diluted EPS of $0.34, Net Loss of $182 million, and Adjusted EBITDA of $2,812 million for 2023.

How much did AES Corporation exceed its asset sale target by in 2023?

AES Corporation exceeded its asset sale target by securing $1.1 billion in asset sale proceeds, surpassing the target of $400 to $600 million.

What are AES Corporation's plans for new projects in 2024?

AES Corporation plans to add 3.6 GW of new projects in 2024.

What is AES Corporation's annualized growth target through 2027?

AES Corporation aims for annualized growth of 7% to 9% through 2027.

What were some of AES Corporation's strategic accomplishments in 2023?

AES Corporation's strategic accomplishments in 2023 include exiting coal generation in various regions, securing grant funding for green hydrogen hubs, and extending gas generation agreements to support grid reliability and decarbonization goals.

The AES Corporation

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AES Stock Data

13.13B
706.90M
0.48%
96.66%
2.58%
Hydroelectric Power Generation
Utilities
Link
United States of America
ARLINGTON