SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported): February 17, 2004
RELIANT RESOURCES, INC.
(Exact Name of Registrant as Specified in its Charter)
DELAWARE 1-16455 76-0655566
(State or Other Jurisdiction (Commission File Number) (IRS Employer
of Incorporation) Identification No.)
1000 MAIN STREET
HOUSTON, TEXAS 77002
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code: (713) 497-3000
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ITEM 12. RESULTS OF OPERATIONS AND FINANCIAL CONDITION.
Attached hereto as Exhibit 99.1 and incorporated by reference herein is the text
of Reliant Resources, Inc.'s announcement of its earnings for the annual period
ended December 31, 2003.
The information in this Item 12 is being furnished, not filed. Accordingly, the
information in this Item 12 will not be incorporated by reference into any
registration statement filed by Reliant Resources, Inc. under the Securities Act
of 1933, as amended, unless specifically identified therein as being
incorporated therein by reference. The furnishing of the information in this
report is not intended to, and does not, constitute a determination or admission
by Reliant Resources Inc. that (i) the information in this report is material or
complete or (ii) investors should consider this information before making an
investment decision with respect to any security of Reliant Resources, Inc. or
any of its affiliates.
A copy of this report has been made available on Reliant Resources, Inc.'s web
site found at www.reliantresources.com in the investor relations section.
STATEMENT ON PURPOSE AND UTILITY OF NON-GAAP FINANCIAL MEASURES
Regulation G, "Conditions for Use of Non-GAAP Financial Measures," and other
provisions of the Securities Exchange Act of 1934 define and prescribe the
conditions for use of certain non-GAAP (GAAP is defined as "accounting
principles generally accepted in the United States") financial information. We
believe that certain of our financial measures, which meet the definition of a
non-GAAP financial measure, are important supplemental information to investors.
We use these non-GAAP financial measures for internal managerial purposes, when
publicly providing guidance on possible future results, and as a means to
evaluate period-to-period comparisons. These non-GAAP financial measures are
used in addition to and in conjunction with results presented in accordance with
GAAP. These non-GAAP financial measures should be viewed as supplementing the
GAAP financial measures. These non-GAAP financial measures reflect an additional
way of viewing aspects of our operations that, when viewed with our GAAP results
and the accompanying reconciliations to corresponding GAAP financial measures,
provide a more complete understanding of factors and trends affecting our
business. Management strongly encourages investors to review our financial
statements and publicly filed reports in their entirety and to not rely on any
single financial measure.
The terms earnings (loss) before interest and taxes (EBIT), adjusted EBIT,
earnings (loss) before interest, taxes, depreciation and amortization (EBITDA),
adjusted EBITDA and "adjusted (loss) income from continuing operations" are used
in Exhibit 99.1. Adjusted EBIT excludes the following special items: (i)
California-related reserves for refund obligations, credit reserves and
interest, (ii) CFTC and FERC settlements, (iii) our goodwill impairment, (iv)
turbine impairments, (v) elimination of net mark-to-market losses recorded in
2002 related to volumes to be delivered in future periods, (vi) volume delivered
but gains which were recorded in previous periods due to change in accounting
rule EITF No. 02-03, (vii) our accrual for payment to CenterPoint Energy, Inc.,
(viii) impairment of venture capital investments and (ix) non-cash pension and
post-retirement benefit accounting settlement. The company's management believes
that EBIT, adjusted EBIT, EBITDA, adjusted EBITDA and "adjusted (loss) income
from continuing operations," as described in the company's earnings release,
provides a more meaningful representation of the company's performance for
purposes of communicating with analysts and investors about earnings outlook and
results. EBIT is the primary measurement used by our management to evaluate
segment performance. In addition, we believe EBITDA is commonly used by
investors to evaluate performance of companies, particularly fixed income
investors.
EBIT, adjusted EBIT, EBITDA, adjusted EBITDA and "adjusted (loss) income from
continuing operations" are not defined under GAAP, and should not be considered
in isolation or as a substitute for a measure of performance prepared in
accordance with GAAP and are not indicative of operating income (loss) from
operations as determined under GAAP. Items excluded from EBIT, adjusted EBIT,
EBITDA, adjusted EBITDA and "adjusted (loss) income from continuing operations"
are significant components in understanding and assessing our financial
performance. Additionally, our computation of EBIT, adjusted EBIT, EBITDA,
adjusted EBITDA and "adjusted (loss) income from continuing operations" may not
be comparable to other similarly titled measures computed by other companies,
because all companies do not calculate them in the same fashion.
Because non-GAAP financial measures are not standardized, it may not be possible
to compare these financial measures with other companies' non-GAAP financial
measures having the same or similar names.
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CAUTIONARY STATEMENTS REGARDING FORWARD-LOOKING INFORMATION
This report and the exhibits attached hereto contain "forward-looking
statements." Forward-looking statements are statements that contain projections
about our revenues, income, earnings and other financial items, our plans and
objectives for the future, future economic performance, or other projections or
estimates about our assumptions relating to these types of statements. These
statements usually relate to future events and anticipated revenues, earnings,
business strategies, competitive position or other aspects of our operations or
operating results. In many cases you can identify forward-looking statements by
terminology such as "anticipate," "estimate," "believe," "continue," "could,"
"intend," "may," "plan," "potential," "predict," "should," "will," "expect,"
"objective," "projection," "forecast," "goal," "guidance," "outlook", "effort",
"target" and other similar words. However, the absence of these words does not
mean that the statements are not forward-looking. We have based our
forward-looking statements on management's beliefs and assumptions based on
information available to management at the time the statements are made. Actual
results may differ materially from those expressed or implied by forward-looking
statements as a result of many factors or events, including legislative and
regulatory developments, the outcome of pending lawsuits, governmental
proceedings and investigations, the effects of competition, financial market
conditions, access to capital, the timing and extent of changes in commodity
prices and interest rates, weather conditions, changes in our business plan and
other factors we discuss in our other filings with the Securities and Exchange
Commission. Each forward-looking statement speaks only as of the date of the
particular statement, and we undertake no obligation to publicly update or
revise any forward-looking statement, whether as a result of new information,
future events or otherwise.
In addition to the matters described in this report and the exhibits attached
hereto, the following are some of the factors that could cause actual results to
differ materially from those expressed or implied in our forward-looking
statements:
o Changes in laws and regulations, including deregulation, re-regulation
and restructuring of the electric utility industry, changes in or
application of environmental and other laws and regulations to which we
are subject, and changes in or application of laws or regulations
applicable to other aspects of our business, such as hedging
activities;
o The outcome of pending lawsuits, governmental proceedings and
investigations;
o The effects of competition, including the extent and timing of the
entry of additional competitors in our markets;
o Liquidity concerns in our markets;
o Our pursuit of potential business strategies;
o The timing and extent of changes in commodity prices and interest
rates;
o The availability of adequate supplies of fuel, water, and associated
transportation necessary to operate our portfolio of generation assets;
o Weather variations and other natural phenomena, which can affect the
demand for power from or our ability to produce power at our generating
facilities;
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o Financial market conditions and our access to capital, including
availability of funds in the capital markets for merchant generation
companies;
o The creditworthiness or bankruptcy or other financial distress of our
counterparties;
o Actions by rating agencies with respect to us or our competitors;
o Acts of terrorism or war;
o The availability and price of insurance;
o Political, legal, regulatory and economic conditions and developments;
o The successful operation of deregulating power markets; the reliability
of the systems, procedures and other infrastructure necessary to
operate our retail electric business, including the systems owned and
operated by the independent system operator in ERCOT; and
o The resolution of the refusal by certain California market participants
to pay our receivables balances and the resolution of the refund
methodologies.
Each forward-looking statement speaks only as of the date of the particular
statement and we undertake no obligation to publicly update or revise any
forward-looking statement, whether as a result of new information, future events
or otherwise.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
RELIANT RESOURCES, INC.
(Registrant)
Date: February 17, 2004 By: /s/ Thomas C. Livengood
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Thomas C. Livengood
Vice President and
Controller
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EXHIBIT INDEX
Exhibit
Number Exhibit Description
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99.1 Press release issued by Reliant Resources, Inc. on February 17,
2004 announcing the earnings of Reliant Resources, Inc. for the
annual period ended December 31, 2003.
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