En ron P.O.BoxlIS8 Houston, TX 77251-i 188 News Release Mark Palmer (713) 853-4738 ENRON REPORTS RECORD FIRST QUARTER RECURRING EARNINGS OF $0.47 PER DILUTED SHARE: INCREASES EARNINGS EXPECTATIONS FOR 2001 FOR IMMEDIATE RELEASE: Tuesday, April 17, 2001 HOUSTON -- Enron Corp. announced today an 18 percent increase in diluted earnings per share to $0.47 for the first quart~r of 2001 from $OAO a year ago. Results for the quarter include: * a 281 percent increase inrevenues to $50.1 billion; * a 20 percent increase innet income to $406 million; * a 65 percent increase in energy volumes to 69 trillion British thermal unit equivalents p~r day (TBtue/d); * a 59 percent increase in new retail energy services contracts to $5.9 billion; and * a seven-fold increase in broadband network services delivered. "Em-on's wholesale business continues to generate outstanding results. Transaction and volume growth are translating into increased profitability," said Jeff Skilling, Enron's president and CEO. "In addition, our retail energy services and broadband intermediation activities are rapidly accelerating." Enron also announced today an increase in its recurring earnings expectation for 2001 to a range of$1 .75 to $1.80 per dilutedshare. The above results exclude a nonrecurring after-tax gain of $19 million, or $0.02 per diluted share, related to the required adoption of new accounting standards. Reported earnings for the first quarter of 2001 were $0.49 per diluted share. PERFORMANCE SUMMARY Enron's businesses are reported as Wholesale Services, Retail Energy Services, Transportation and Distribution, aiid Broadband Services. GOVERNMENT~" Endless possibilities?' Cnm No H 04 0025 ECSHP000379651 ~& 2 Wholesale Services: Income before interest, minority interests and taxes (IBIT) increased 76 percent to $755 million in the recent quarter, marking Wholesale Services' 21st consecutive period of year-over-year quarterly earnings growth. Commodity Sales and Services: Enron is a leading marketer and manager of energy and other commodities. IBIT related to Enron's wholesale commodity activities increased 207 percent to $785 million in the recent quarter. All regions and products contributed to the record results, with Enron's broad-based North American natural gas and power businesses leading the increase in profitability. European wholesale earnings also increased, as liquidity and market access on the Continent continued to advance. In addition, Enron's new wholesale commodity businesses, including coal, steel and forest products, contributed to the quarter's strong results. EnronOnline, Enron's eCominerce transaction platform, continues to provide substantial competitive advantages, including expanded market reach and efficiency gains. Over $525 billion of total gross value has been transacted online since inception in late 1999. New records for average weekly volume continued to be set throughout the recent quarter. Wholesale physical volumes experienced growth across all regions in the first quarter, including: * Total Wholesale: - a 65 percent increase in total wholesale volumes to 69 TBtue/d; - a 55 percent increase in natural gas volumes to 36.5 TBtu/d; and - a 109 percent increase in power volumes to 232 million megawatt hours. * North America: - a 32 percent increase in natural gas Qolumes to 27.8 TBtuId and - a 90 percent increase in power volumes to 195 million megawatt hours. * Europe and Other: - a 252 percent increase in natural gas volumes to 8.7 TBtuld and - a 363 percent increase in power volumes to 36 million megawatt hours. Assets and Investments: Enron invests in, develops, constructs and operates energy- related and other assets. IBIT from Assets and Investments was $59 million compared to $220 million last year, primarily due to lower earnings from merchant inveStments and related assets. Endless possibilities.TM ECSHP000379652 Retail Energy Services: Enron's Retail Energy Services offers comprehensive energy management products to business customers in North America and Europe. IBIT for the retail business increased to $40 million in the first quarter. Contracting in the first quarter increased almost 60 percent to $5.9 billion. Recently announced long-term energy management customers include Owens-Illinois, Quaker Oats, Eli Lilly, JCPenney and Saks Incorporated. Enron now manages over 31,000 facilities representing 3.1 billion square feet. Beginning in 2001, risk management activities associated with Enron's retail customer contracts are rrianaged by Wholesale Services, consolidating all energy commodity risk management activities within one business unit. Previously reported results have been restated to reflect this change (see Table 3b). Transportation and Distribution: Enron's Transportation Services and Portland General Electric are included in this group. Transportation Services reported $133 million of IBIT in the first quarter compared to $128 million last year. The business continues to experience strong demand for natural gas pipeline services. Several pipeline expansion projects are underway, including 625 million cubic feet per day (MMcf/d) of new capacity to Florida, to be completed in two phases beginning the second quarter of 2001, and a 150 MMcf/d addition to Ca]ifornia to be completed in 2002. Portland General reported first quarter IBIT of $60 million compared to $105 million last year. Reduced earnings in 2001 reflect higher power costs, reduced.investment income and the impacts of certain regulatory events. Broadband Services: Enron's Broadband Services reported a $35 million IBIT loss for the first quarter. Enron's global broadband platform is substantially complete, and 25 pooling points are operating in North America, Europe and Japan. Enron's broadband intermediation activity increased significantly, with over 580 transactions executed during the quarter - more than in all of 2000. Eriron also added 70 new broadband customers this quarter for a total of 120 customers. Also during the quarter, an Enron affiliate executed $45 million of contracts associated with the delivery of premium content. Revenues in the quarter related primarily to a monetization of a portion of Enron's content services business. Endless possibilities.TM ECSHP000379653 V. 7 ~r$c~w.w Corporate and Other: Corporate and Other reported an IBIT loss of $158 million for the quarter, primarily due to higher unallocated corporate-wide expenses and operating losses from non-core businesses. OTHER INFORMATION Including nonrecurring results, Enron reported earnings of $0.49 per diluted share in the first quarter of 2001, compared to $0.40 in the same period of 2000. 2001 quarterly results included a nonrecurring after-tax gain of $19 million for the required adoption of new accounting standards. Enron follows mark-to-market accounting for its price risk management activities. The new rules require certain derivative instruments that are not included in Enron's price risk management activities to be recorded at fair value. A conference call with Enron management regarding first quarter resultswill be conducted live today at 10:00 a.m. EDT and may be accessed through the Investor page at www.enron.com. Please see attached tables for addition alfinancial information. This press release includes forward.looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21 E of the Securities Exchange Act of 1934. Although Enron believes that its expectations are based on reasonable assumptions, it can give no assurance that its goals will be achieved. Important factors that could cause actual results to differ materially from those in the forward looking statements herein include success in marketing natural gas and power to wholesale customers; the ability to penetrate new retail natural gas and electricity markets, including the energy uutsource market, in the United States and Europe; the timing, extent and market effects of deregulation of energy markets in the United States and in foreign jurisdictions; development of Enron's broadband network and customer demand for intermediation and content services; and conditions of the capital markets and equity markets during the periods covered by the forward looking statements. Endless possibilities.TM ECSHP000379654 ENRON CORP. Table I - Earnings Summary (Unaudited: in millions, except per share data) Quarter Ended March 31, 2001 2000 Revenues Transportation and Distribution: Transportation Services Portland General Wholesale Services Retail Energy Services (a) Broadband Services Corporate and Other (including intercompany elimInations) Total Revenues After tax results Net Income excluding nonrecurring items Non-recurring items: Cumulative effect of accounting change Net income Earnings per share (diluted) (b) EPS (dIluted) excluding nonrecurring Items Non-recurring items: Cumulative effect of accounting change EPS (diluted) Average shares outstanding (diluted) (b) $ 246 $ .206 767 397 48,506 12,329 693 314 83 59 $ 50,129 $ 13,145 $ 406 $ 338 19 __________ $ 425 $ 338 $ 0.47 $ 0.40 0.02 __________ $ 0.49 $ 0.40 871.6 851.9 (a) See Table 3b. (b) The Second Preferred Stock and the Series B Preferred Stock are both dilutive in the first quarter of 2000 and 2001. ECSHP000379655 First Quarter 2001 I, ENRON CORP. Table 2a - Results by Segment (Unaudited: in millions, except per share amounts) Non- Recurring Recurring Total IBIT: Transportation and Distribution: Transportation Services Portland General Wholesale Services Retail Energy Services Broadband Services Corporate and Other IBIT Interest and Related Charges, net Dividends on Preferred Securities of Subsidiaries Minority Interests income Tax Expense Net income Before Cumulative Accounting Change Cumulative Effect df Accounting Change, net of tax Net Income Preferred Dividends (a): Second Preferred Stock Series B Preferred Stock Earnings on Common Stock Average Number of Shares Used: Basic Diluted Earnings per Common Share: Basic Diluted $ 133$ $ 133 60 60 755. 755 40 40 (35) (35) -. 795 795 201 201 18 18 40 40 130 __________ 130 406 - 406 - 19 19 406 19 425 4 4 16 ___________ 16 $ 386 $ 19 $ 405 751.5 871.6 871.6 871.6 $ 0.54 $ 0.47 $ 0.02 $ 0.49 (a) The Second Preferred Stock and the Series B Preferred Stock are both dilutive in the first quarter of 2001. ECSHP000379656 First Quarter 2000 ENRON CORP. Table 2b - Results by Segment (Unaudited: in millions, except per share amounts) Non- Recurring Recurring - Total lBIT~ Tran~portation and Distributian~ T~ansportatiOn Services Portland General Wholesale Services Retail Energy Services (a) Broadband Services Corporate and Other IBIT Interest and Related Charges, net Dividends on Preferred Securities of Subsidiaries Minority interesis Income Tax Expense Net Income Preferred Dividends (b): Second Preferred Stock Series B Preferred Stock Earnings on Common Stock Average Number of Shares Used: Basic Diluted Earnings per Common Share: Basic Diluted $ 128 105 429 6 (44) __________ 624 - 624 161 161 $ 128 $ 105 429 6 18 18 35 35 72 ___________ 72 338 - 338 4 4 16 __________ 16 $ 318 $ - $ 318 722.5 851.9 851.9 851.9 $ 0.40 $ - $ 0.44 __________ __________ $ 0.40 (a) See Table 3b. (b) The Second Preferred Stock and the Series B Preferred Stack are bath dilutive in the first quarter of 2000. ECSHP000379657 ENRON CORP. Table 3a - Business Highlights (Uneudited) Quarter Ended March 31, 2001 2000 Transportation Services (In Millions) Net Revenues Operating Expenses Depreciation and Amortization Equity in Earnings Other, net IBIT Total Volumes Transported (BBtu/d) (a) Northern Natural Gas Transwestern Pipeline Florida Gas Transmission Northern Border Pipeline $ 243$ 107 17 14 201 65 16 7 - I $ 133$ 128 3,750 1,725 1,234 2,490 4,147 1,566 1,563. 2,464 Portland General (In Millions) Revenues Purchased Power and Fuel Operating Expenses Depreciation and Amortization Other Income, net IBIT Retail Customers (end of period, thousands) Electricity Sales (Thousand MWh) Residential Commercial Industrial Total Retail Wholesale Total Sales $ 767$ 397 552 202 67 75 51 46 ilL 34 $ 60 $ 105 S 727 724 2,171 1,820 5,191 7,930 2,361 1,572 5,402 9,683 (a) Reflects 100% of each entity's throughput volumes. ECSHP000379658 * I ENRON CORP. Table 3b - Business Highlights (Unauditad) Quarter Ended March 31, Wholesale Services (In Millions) Commodity Sales and Services Assets and Investments Unallocated Expenses IBIT Commodity Sales and Services Physical Volumes (B8tue/d) Gas; United States Canada Europe and Other Transportation Volumes Total Gas Volumes* Crude Oil and Liquids Electricity (a) Total Physical Volumes (BBtueld) Electricity Volumes (Thousand MWh) United States Europe and Other Total Financial Settlements (NoUonal)(BBtue/d) Retail Energy Services Revenues (in millions) (b) BIT (in millions) (b) Total Contract Value (in billions)(c) $ 785 $ 59 $ 785 $ 20,898 6.358 35.955 508 36,461 6,836 195,246 36,339 302,694 141,865 A $ $ 693 $ 40 $ 5.9 $ ~andServiceEflflflrJ Revenues (in millions) BIT (in millions) Total Contract Value (in miliionsgc) Terabytes Delivered (d) $ 83 $ $ (35)$ $4~ 45$ 43,400 (a) Represents electricity volumes, converted to BBtued. (b) Beginning in 2001, risk management actlvitlesassociated withEnron's retail customers are managed by Wholesale Services. Prior to the restatement, Retail Energy Services' reported revenues and recurring BIT were $642 million and $16 million, respectively, forthe firstquarterof 2000 and $4,615 million and $103 million, respectively, for the full year 2000. Restated full year 2000 revenues and recuning 1817 were $1,766 million and $111 million, respectively. Current year and the restated 2000 amounts include activities related to the management of customer relationships, net profits of new commodity contracts originated and all flows related to energy asset management and services. (c) Represents customers' estimated future expenditures related to new contracts. (d) Unit of measurement for data delivered, equal to one trillion bytes. ECSHP000379659 2001 2000 256 220 (47) 429 - 10,217 4,389 23,075 456 23,531 6,134 102,903 7 844 - 314 6 3.7 59 31 6,005