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Cash paid to seller at close | $ | 603 | ||
Net working capital adjustments | (4 | ) | ||
Consideration paid to seller | 599 | |||
Cash paid to repay project financing at close | 950 | |||
Total cash paid related to acquisition | $ | 1,549 | ||
Cash and cash equivalents | $ | 210 | ||
Property, plant and equipment — net | 1,316 | |||
Commodity and other derivative contractual assets | 47 | |||
Other assets | 44 | |||
Total assets acquired | 1,617 | |||
Commodity and other derivative contractual liabilities | 53 | |||
Trade accounts payable and other liabilities | 15 | |||
Total liabilities assumed | 68 | |||
Identifiable net assets acquired | $ | 1,549 |
Predecessor | |||||||
Period from January 1, 2016 through October 2, 2016 | Year Ended December 31, 2015 | ||||||
Revenues | $ | 4,116 | $ | 6,133 | |||
Net income (loss) | $ | 22,835 | $ | (4,671 | ) |
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Name | Location (all in the state of Texas) | Fuel Type | Installed Nameplate Generation Capacity (MW) | Number of Units | Date Units Taken Offline | ||||||
Monticello | Titus County | Lignite/Coal | 1,880 | 3 | January 4, 2018 | ||||||
Sandow | Milam County | Lignite | 1,137 | 2 | January 11, 2018 | ||||||
Big Brown | Freestone County | Lignite/Coal | 1,150 | 2 | February 12, 2018 | ||||||
Total | 4,167 | 7 |
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Predecessor | |||||||
Period from January 1, 2016 through October 2, 2016 | Year Ended December 31, 2015 | ||||||
Gain on reorganization adjustments (Note 6) | $ | (24,252 | ) | $ | — | ||
Loss from the adoption of fresh start reporting | 2,013 | — | |||||
Expenses related to legal advisory and representation services | 55 | 141 | |||||
Expenses related to other professional consulting and advisory services | 39 | 69 | |||||
Contract claims adjustments | 13 | 54 | |||||
Noncash adjustment for estimated allowed claims related to debt | — | 896 | |||||
Adjustment to affiliate claims pursuant to Settlement Agreement (Note 19) | — | (635 | ) | ||||
Gain on settlement of debt held by affiliates (Note 19) | — | (382 | ) | ||||
Gain on settlement of interest on debt held by affiliates | — | (20 | ) | ||||
Sponsor management agreement settlement | — | (19 | ) | ||||
Contract assumption adjustments | — | (14 | ) | ||||
Fees associated with extension/completion of the DIP Facility | — | 9 | |||||
Other | 11 | 2 | |||||
Total reorganization items | $ | (22,121 | ) | $ | 101 |
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• | historical financial information of our Predecessor for recent years and interim periods; |
• | certain internal financial and operating data of our Predecessor; |
• | certain financial, tax and operational forecasts of Vistra Energy; |
• | certain publicly available financial data for comparable companies to the operating business of Vistra Energy; |
• | the Plan of Reorganization and related documents; |
• | certain economic and industry information relevant to the operating business, and |
• | other studies, analyses and inquiries. |
Business enterprise value | $ | 10,500 | |
Cash excluded from business enterprise value | 1,594 | ||
Deferred asset related to prepaid capital lease obligation | 38 | ||
Current liabilities, excluding short-term portion of debt and capital leases | 1,123 | ||
Noncurrent, non-interest bearing liabilities | 1,906 | ||
Vistra Energy reorganization value of assets | $ | 15,161 |
October 3, 2016 | |||||||||||||||||||
TCEH (Predecessor) (1) | Reorganization Adjustments (2) | Fresh Start Adjustments | Vistra Energy (Successor) | ||||||||||||||||
ASSETS | |||||||||||||||||||
Current assets: | |||||||||||||||||||
Cash and cash equivalents | $ | 1,829 | $ | (1,028 | ) | (3) | $ | — | $ | 801 | |||||||||
Restricted cash | 12 | 131 | (4) | — | 143 | ||||||||||||||
Trade accounts receivable — net | 750 | 4 | — | 754 | |||||||||||||||
Advances to parents and affiliates of Predecessor | 78 | (78 | ) | — | — | ||||||||||||||
Inventories | 374 | — | (86 | ) | (17) | 288 | |||||||||||||
Commodity and other derivative contractual assets | 255 | — | — | 255 | |||||||||||||||
Margin deposits related to commodity contracts | 42 | — | — | 42 | |||||||||||||||
Other current assets | 47 | 17 | 3 | 67 | |||||||||||||||
Total current assets | 3,387 | (954 | ) | (83 | ) | 2,350 | |||||||||||||
Restricted cash | 650 | — | — | 650 | |||||||||||||||
Advance to parent and affiliates of Predecessor | 17 | (21 | ) | 4 | — | ||||||||||||||
Investments | 1,038 | 1 | 9 | (18) | 1,048 | ||||||||||||||
Property, plant and equipment — net | 10,359 | 53 | (5,970 | ) | (19) | 4,442 | |||||||||||||
Goodwill | 152 | — | 1,755 | (27) | 1,907 | ||||||||||||||
Identifiable intangible assets — net | 1,148 | 4 | 2,256 | (20) | 3,408 | ||||||||||||||
Commodity and other derivative contractual assets | 73 | — | (14 | ) | 59 | ||||||||||||||
Deferred income taxes | — | 320 | (5) | 730 | (21) | 1,050 | |||||||||||||
Other noncurrent assets | 51 | 38 | 158 | (22) | 247 | ||||||||||||||
Total assets | $ | 16,875 | $ | (559 | ) | $ | (1,155 | ) | $ | 15,161 | |||||||||
LIABILITIES AND EQUITY | |||||||||||||||||||
Current liabilities: | |||||||||||||||||||
Long-term debt due currently | $ | 4 | $ | 5 | $ | (1 | ) | $ | 8 | ||||||||||
Trade accounts payable | 402 | 145 | (6) | 3 | 550 | ||||||||||||||
Trade accounts and other payables to affiliates of Predecessor | 152 | (152 | ) | (6) | — | — | |||||||||||||
Commodity and other derivative contractual liabilities | 125 | — | — | 125 | |||||||||||||||
Margin deposits related to commodity contracts | 64 | — | — | 64 | |||||||||||||||
Accrued income taxes | 12 | 12 | — | 24 | |||||||||||||||
Accrued taxes other than income | 119 | 4 | — | 123 | |||||||||||||||
Accrued interest | 110 | (109 | ) | (7) | — | 1 | |||||||||||||
Other current liabilities | 243 | 170 | (8) | 5 | 418 | ||||||||||||||
Total current liabilities | 1,231 | 75 | 7 | 1,313 |
October 3, 2016 | |||||||||||||||||||
TCEH (Predecessor) (1) | Reorganization Adjustments (2) | Fresh Start Adjustments | Vistra Energy (Successor) | ||||||||||||||||
Long-term debt, less amounts due currently | — | 3,476 | (9) | 151 | (23) | 3,627 | |||||||||||||
Borrowings under debtor-in-possession credit facilities | 3,387 | (3,387 | ) | (9) | — | — | |||||||||||||
Liabilities subject to compromise | 33,749 | (33,749 | ) | (10) | — | — | |||||||||||||
Commodity and other derivative contractual liabilities | 5 | — | 3 | 8 | |||||||||||||||
Deferred income taxes | 256 | (256 | ) | (11) | — | — | |||||||||||||
Tax Receivable Agreement obligation | — | 574 | (12) | — | 574 | ||||||||||||||
Asset retirement obligations | 809 | — | 854 | (24) | 1,663 | ||||||||||||||
Other noncurrent liabilities and deferred credits | 1,018 | 117 | (13) | (900 | ) | (25) | 235 | ||||||||||||
Total liabilities | 40,455 | (33,150 | ) | 115 | 7,420 | ||||||||||||||
Equity: | |||||||||||||||||||
Common stock | — | 4 | (14) | — | 4 | ||||||||||||||
Additional paid-in-capital | — | 7,737 | (15) | — | 7,737 | ||||||||||||||
Accumulated other comprehensive income (loss) | (32 | ) | 22 | 10 | (26) | — | |||||||||||||
Predecessor membership interests | (23,548 | ) | 24,828 | (16) | (1,280 | ) | (26) | — | |||||||||||
Total equity | (23,580 | ) | 32,591 | (1,270 | ) | 7,741 | |||||||||||||
Total liabilities and equity | $ | 16,875 | $ | (559 | ) | $ | (1,155 | ) | $ | 15,161 |
(1) | Represents the consolidated balance sheet of TCEH as of October 3, 2016. |
(2) | Includes the addition of certain assets and liabilities associated with the Contributed EFH Entities. Also includes EFH Corp.'s contribution of liabilities associated with certain employee benefit plans to Vistra Energy. |
(3) | Net adjustments to cash, which represent distributions made or funding provided to an escrow account, classified as restricted cash, under the Plan of Reorganization, as follows: |
Sources (uses): | |||
Net proceeds from PrefCo preferred stock sale | $ | 69 | |
Addition of cash balances from the Contributed EFH Debtors | 22 | ||
Payments to TCEH first lien creditors, including adequate protection | (486 | ) | |
Payment to TCEH unsecured creditors (including $73 million to escrow) | (502 | ) | |
Payment of administrative claims to TCEH creditors | (53 | ) | |
Payment of legal fees, professional fees and other costs (including $52 million to escrow) | (78 | ) | |
Net use of cash | $ | (1,028 | ) |
(4) | Increase in restricted cash primarily reflects amounts placed in escrow to satisfy certain secured claims, unsecured claims and professional fee obligations associated with the bankruptcy. |
(5) | Reflects the deferred income tax impact of the Plan of Reorganization implementation, including cancellation of debts and adjustment of tax-basis for certain assets of PrefCo that issued mandatorily redeemable preferred stock as part of the Spin-Off. |
(6) | Primarily reflects the reclassification of transmission and distribution service payables to Oncor from payables with affiliates to trade payables with third parties pursuant to the separation of Vistra Energy from EFH Corp. and payment of accrued professional fees and unsecured claimant obligations incurred in conjunction with Emergence. |
(7) | Primarily reflects the payment of accrued interest and adequate protection to the TCEH first lien creditors on the Effective Date. |
(8) | Primarily reflects the following: |
• | Reclassification of $82 million from LSTC related to secured and unsecured claims and $16 million in accrued professional fees from accounts payable to other current liabilities. |
• | Additional accruals for $23 million of change-in-control obligations and $26 million in success fees triggered by Emergence, $7 million in professional fees, and $28 million of accrued liabilities related to the Contributed EFH Entities. |
• | Payment of $12 million in professional fees. |
(9) | Reflects the conversion of the TCEH DIP Roll Facilities of $3.387 billion to the Vistra Operations Credit Facilities at Emergence, the issuance and sale of mandatorily redeemable preferred stock of PrefCo for $70 million, and the obligation related to a corporate office space lease contributed to Vistra Energy pursuant to the Plan of Reorganization. See Note 12 for additional details. |
(10) | Reflects the elimination of TCEH's liabilities subject to compromise pursuant to the Plan of Reorganization (see Note 5). Liabilities subject to compromise were settled as follows in accordance with the Plan of Reorganization: |
Notes, loans and other debt | $ | 31,668 | |
Accrued interest on notes, loans and other debt | 646 | ||
Net liability under terminated TCEH interest rate swap and natural gas hedging agreements | 1,243 | ||
Trade accounts payable and other expected allowed claims | 192 | ||
Third-party liabilities subject to compromise | 33,749 | ||
LSTC from the Contributed EFH Entities | 8 | ||
Total liabilities subject to compromise | 33,757 | ||
Fair value of equity issued to TCEH first lien creditors | (7,741 | ) | |
TRA Rights issued to TCEH first lien creditors | (574 | ) | |
Cash distributed and accruals for TCEH first lien creditors | (377 | ) | |
Cash distributed for TCEH unsecured claims | (502 | ) | |
Cash distributed and accruals for TCEH administrative claims | (60 | ) | |
Settlement of affiliate balances | (99 | ) | |
Net liabilities of contributed entities and other items | (60 | ) | |
Gain on extinguishment of LSTC | $ | 24,344 |
(11) | Reflects the deferred income tax impact of the Plan of Reorganization implementation, including cancellation of debts and adjustment of tax basis of certain assets of PrefCo. |
(12) | Reflects the estimated present value of the TRA obligation. See Note 9 for further discussion of the TRA obligation valuation assumptions. |
(13) | Primarily reflects the following: |
• | Addition of $122 million in liabilities primarily related to benefit plan obligations associated with a pension plan and a health and welfare plan assumed by Vistra Energy pursuant to the Plan of Reorganization. See Note 17 for further discussion of the benefit plan obligations. |
• | Payment of $7 million in settlements related to split life insurance costs with a prior affiliate entity. |
(14) | Reflects the issuance of approximately 427,500,000 shares of Vistra Energy common stock, par value of $0.01 per share, to the TCEH first lien creditors. See Note 14. |
(15) | Reflects adjustments to present Vistra Energy equity value at approximately $7.741 billion based on a reconciliation from the $10.5 billion enterprise value described above under Reorganization Value as depicted below: |
Enterprise value | $ | 10,500 | |
Vistra Operations Credit Facility – Initial Term Loan B Facility | (2,871 | ) | |
Vistra Operations Credit Facility – Term Loan C Facility | (655 | ) | |
Accrual for post-Emergence claims satisfaction | (181 | ) | |
Tax Receivable Agreement obligation | (574 | ) | |
Preferred stock of PrefCo | (70 | ) | |
Other items | (2 | ) | |
Cash and cash equivalents | 801 | ||
Restricted cash | 793 | ||
Equity value at Emergence | $ | 7,741 | |
Common stock at par value | $ | 4 | |
Additional paid-in capital | 7,737 | ||
Equity value | $ | 7,741 | |
Shares outstanding at October 3, 2016 (in millions) | 427.5 | ||
Per share value | $ | 18.11 |
(16) | Membership Interest impact of Plan of Reorganization are shown below: |
Gain on extinguishment of LSTC | $ | 24,344 | |
Elimination of accumulated other comprehensive income | (22 | ) | |
Change in control payments | (23 | ) | |
Professional fees | (33 | ) | |
Other items | (14 | ) | |
Pretax gain on reorganization adjustments (Note 5) | 24,252 | ||
Deferred tax impact of the Plan of Reorganization and Spin-off | 576 | ||
Total impact to membership interests | $ | 24,828 |
(17) | Reflects the reduction of inventory to fair value, including (1) adjustment of fuel inventory to current market prices, and (2) an adjustment to the fair value of materials and supplies inventory primarily used in our lignite/coal-fueled generation assets and related mining operations. |
(18) | Reflects the $12 million increase in the fair value of certain real property assets and $3 million reduction of the fair value for other investments. |
(19) | Reflects the change in fair value of property, plant and equipment related primarily to generation and mining assets as detailed below: |
Property, Plant and Equipment | Adjustment | Fair Value | ||||
Generation plants and mining assets | $ | (6,057 | ) | $ | 3,698 | |
Land | 140 | 490 | ||||
Nuclear Fuel | (23 | ) | 157 | |||
Other equipment | (30 | ) | 97 | |||
Total | $ | (5,970 | ) | $ | 4,442 |
(20) | Reflects the adjustment in fair value of $2.256 billion to identifiable intangible assets, including $1.636 billion increase related to retail customer relationships, $270 million increase related to the retail trade name, $190 million increase related to an electricity supply contract, $164 million increase related to retail and wholesale contracts and $4 million decrease related to other intangible assets (see Note 7). |
(21) | Reflects the deferred income tax impact of fresh-start adjustments to property, plant, and equipment, inventory, intangibles and debt issuance costs. |
(22) | Primarily reflects the following: |
• | Addition of $197 million regulatory asset related to the deficiency of the nuclear decommissioning trust investment as compared to the nuclear generation plant retirement obligation. Pursuant to Texas regulatory provisions, the trust fund for decommissioning our nuclear generation facility is funded by a fee surcharge billed to REPs by Oncor, as a collection agent, and remitted monthly to Vistra Energy. |
• | Adjustment to remove $26 million of unamortized debt issuance costs to reflect the Vistra Operations Credit Facilities at fair market value. |
(23) | Reflects the increase in fair value of the Vistra Operations Credit Facilities in the amount of $151 million based on the quoted market prices of the facilities. |
(24) | Increase in fair value of asset retirement obligation related to the plant retirement, mining and reclamation retirement, and coal combustion residuals. See Note 21 for further discussion of our asset retirement obligations. |
(25) | Reflects the following: |
• | Reduction in fair value of unfavorable contracts related to wholesale contracts and a portion of an electricity supply contract in the amount of $476 million. See footnote (20) above for further detail. |
• | Reduction of $465 million related to reduction in liability that represented excess amounts in the nuclear decommissioning trust above the carrying value of the asset retirement obligation related to our nuclear generation plant decommissioning. |
• | Increase in fair value of obligations related to leased property in the amount of $29 million. |
• | Increase in fair value of Pension and OPEB obligations in the amount of $12 million. |
(26) | Reflects the extinguishment of Predecessor membership interest and accumulated other comprehensive loss per the Plan of Reorganization. |
(27) | Reflects increase in goodwill balance to present final goodwill as the reorganization value in excess of the identifiable tangible assets, intangible assets, and liabilities at Emergence. |
Business enterprise value | $ | 10,500 | |
Add: Fair value of liabilities excluded from enterprise value | 3,030 | ||
Less: Fair value of tangible assets | (8,215 | ) | |
Less: Fair value of identified intangible assets | (3,408 | ) | |
Vistra Energy goodwill | $ | 1,907 |
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December 31, 2017 | December 31, 2016 | |||||||||||||||||||||||
Identifiable Intangible Asset | Gross Carrying Amount | Accumulated Amortization | Net | Gross Carrying Amount | Accumulated Amortization | Net | ||||||||||||||||||
Retail customer relationship | $ | 1,648 | $ | 572 | $ | 1,076 | $ | 1,648 | $ | 152 | $ | 1,496 | ||||||||||||
Software and other technology-related assets | 183 | 47 | 136 | 147 | 9 | 138 | ||||||||||||||||||
Electricity supply contract (a) | — | — | — | 190 | 2 | 188 | ||||||||||||||||||
Retail and wholesale contracts | 154 | 87 | 67 | 164 | 38 | 126 | ||||||||||||||||||
Other identifiable intangible assets (b) | 33 | 11 | 22 | 30 | 2 | 28 | ||||||||||||||||||
Total identifiable intangible assets subject to amortization | $ | 2,018 | $ | 717 | 1,301 | $ | 2,179 | $ | 203 | 1,976 | ||||||||||||||
Retail trade names (not subject to amortization) | 1,225 | 1,225 | ||||||||||||||||||||||
Mineral interests (not currently subject to amortization) | 4 | 4 | ||||||||||||||||||||||
Total identifiable intangible assets | $ | 2,530 | $ | 3,205 |
(a) | Contract terminated in October 2017. See Note 4. |
(b) | Includes mining development costs and environmental allowances and credits. |
Successor | Predecessor | ||||||||||||||||||||
Identifiable Intangible Asset | Statements of Consolidated Income (Loss) Line | Remaining useful lives at December 31, 2017 (weighted average in years) | Year Ended December 31, 2017 | Period from October 3, 2016 through December 31, 2016 | Period from January 1, 2016 through October 2, 2016 | Year Ended December 31, 2015 | |||||||||||||||
Retail customer relationship | Depreciation and amortization | 4 | $ | 420 | $ | 152 | $ | 9 | $ | 17 | |||||||||||
Software and other technology-related assets | Depreciation and amortization | 3 | 38 | 9 | 44 | 60 | |||||||||||||||
Electricity supply contract | Operating revenues | 0 | 6 | 2 | — | — | |||||||||||||||
Retail and wholesale contracts | Operating revenues/fuel, purchased power costs and delivery fees | 3 | 59 | 38 | — | — | |||||||||||||||
Other identifiable intangible assets | Operating revenues/fuel, purchased power costs and delivery fees/depreciation and amortization | 4 | 9 | 2 | 6 | 30 | |||||||||||||||
Total amortization expense (a) | $ | 532 | $ | 203 | $ | 59 | $ | 107 |
(a) | Amounts recorded in depreciation and amortization totaled $463 million, $162 million, $58 million and $85 million for the Successor period for the year ended December 31, 2017 and the period from October 3, 2016 through December 31, 2016 and the Predecessor period from January 1, 2016 through October 2, 2016 and the year ended December 31, 2015, respectively. |
• | Retail customer relationship – Retail customer relationship intangible asset represents the fair value of our non-contracted retail customer base, including residential and business customers, and is being amortized using an accelerated method based on historical customer attrition rates and reflecting the expected pattern in which economic benefits are realized over their estimated useful life. |
• | Retail trade names – Our retail trade name intangible asset represents the fair value of the TXU EnergyTM and 4Change EnergyTM trade names, and was determined to be an indefinite-lived asset not subject to amortization. This intangible asset is evaluated for impairment at least annually in accordance with accounting guidance related to goodwill and other indefinite-lived intangible assets. Significant assumptions included within the development of the fair value estimate include TXU Energy's and 4Change Energy's estimated gross margins for future periods and implied royalty rates. On the most recent testing date, we determined that it was more likely than not that the fair value of our retail trade name intangible asset exceeded its carrying value at October 1, 2017. |
• | Electricity supply contract – The electricity supply contract represents a long-term fixed-price supply contract for the sale of electricity from one of our generation facilities that was measured at fair value at Emergence. The value of this contract under our Predecessor was recorded as an unfavorable liability due to prevailing market prices of electricity when the contract was established in 2007. Significant assumptions included in the fair value measurement for this contract include long-term wholesale electricity price forecasts and operating cost forecasts for the respective generation facility. This contract was terminated in October 2017. See Note 4. |
• | Retail and wholesale contracts – These intangible assets represent the favorable value of various retail and wholesale contracts (both purchase and sale contracts) that were measured at fair value by utilizing prevailing market prices for commodities or services compared to the fixed prices contained in these agreements. The value of these contracts is being amortized using a method that is based on the monthly value of each contract measured at Emergence. |
Year | Estimated Amortization Expense | |||
2018 | $ | 367 | ||
2019 | $ | 268 | ||
2020 | $ | 191 | ||
2021 | $ | 142 | ||
2022 | $ | 4 |
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Successor | Predecessor | |||||||||||||||
Year Ended December 31, 2017 | Period from October 3, 2016 through December 31, 2016 | Period from January 1, 2016 through October 2, 2016 | Year Ended December 31, 2015 | |||||||||||||
Current: | ||||||||||||||||
U.S. Federal | $ | 72 | $ | — | $ | (6 | ) | $ | (17 | ) | ||||||
State | 14 | 6 | 9 | 21 | ||||||||||||
Total current | 86 | 6 | 3 | 4 | ||||||||||||
Deferred: | ||||||||||||||||
U.S. Federal | 417 | (75 | ) | (1,234 | ) | (811 | ) | |||||||||
State | 1 | (1 | ) | (36 | ) | (72 | ) | |||||||||
Total deferred | 418 | (76 | ) | (1,270 | ) | (883 | ) | |||||||||
Total | $ | 504 | $ | (70 | ) | $ | (1,267 | ) | $ | (879 | ) |
Successor | Predecessor | |||||||||||||||
Year Ended December 31, 2017 | Period from October 3, 2016 through December 31, 2016 | Period from January 1, 2016 through October 2, 2016 | Year Ended December 31, 2015 | |||||||||||||
Income (loss) before income taxes | $ | 250 | $ | (233 | ) | $ | 21,584 | $ | (5,556 | ) | ||||||
Income taxes at the U.S. federal statutory rate of 35% | 88 | (82 | ) | 7,554 | (1,945 | ) | ||||||||||
Nondeductible TRA accretion | (80 | ) | 5 | — | — | |||||||||||
Texas margin tax, net of federal benefit | 13 | 3 | (21 | ) | — | |||||||||||
Impacts of tax reform legislation on deferred taxes | 451 | — | — | — | ||||||||||||
Effects of Tax Matters Agreement and tax-free spin-off transaction | 19 | — | — | — | ||||||||||||
Nondeductible debt restructuring costs | — | 2 | 38 | 64 | ||||||||||||
Nondeductible interest expense | — | — | 12 | 21 | ||||||||||||
Nontaxable gain on extinguishment of LSTC | — | — | (8,593 | ) | — | |||||||||||
Valuation allowance | — | — | (210 | ) | 210 | |||||||||||
Nondeductible goodwill impairment | — | — | — | 770 | ||||||||||||
Lignite depletion allowance | — | — | — | (8 | ) | |||||||||||
Interest accrued for uncertain tax positions, net of tax | — | — | — | (2 | ) | |||||||||||
Other | 13 | 2 | (47 | ) | 11 | |||||||||||
Income tax expense (benefit) | $ | 504 | $ | (70 | ) | $ | (1,267 | ) | $ | (879 | ) | |||||
Effective tax rate | 201.6 | % | 30.0 | % | (5.9 | )% | 15.8 | % |
December 31, | |||||||
2017 | 2016 | ||||||
Noncurrent Deferred Income Tax Assets | |||||||
Net operating loss (NOL) carryforwards | $ | — | $ | 8 | |||
Property, plant and equipment | 520 | 943 | |||||
Intangible assets | 81 | 29 | |||||
Long-term debt | 20 | 52 | |||||
Employee benefit obligations | 56 | 84 | |||||
Commodity contracts and interest rate swaps | 25 | — | |||||
Other | 8 | 6 | |||||
Total deferred tax assets | $ | 710 | $ | 1,122 |
Predecessor | |||||||
Period from January 1, 2016 through October 2, 2016 | Year Ended December 31, 2015 | ||||||
Balance at beginning of period, excluding interest and penalties | $ | 36 | $ | 65 | |||
Reductions based on tax positions related to prior years | (1 | ) | (11 | ) | |||
Settlements with taxing authorities | (35 | ) | (18 | ) | |||
Balance at end of period, excluding interest and penalties | $ | — | $ | 36 |
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Successor | |||||||
Year Ended December 31, 2017 | Period from October 3, 2016 through December 31, 2016 | ||||||
TRA obligation at the beginning of the period | $ | 596 | $ | 574 | |||
Accretion expense | 82 | 22 | |||||
Payments | (26 | ) | — | ||||
Revaluation due to tax reform legislation | (233 | ) | — | ||||
Changes in tax assumptions impacting timing of payments | (62 | ) | — | ||||
TRA obligation at the end of the period | 357 | 596 | |||||
Less amounts due currently | (24 | ) | — | ||||
Noncurrent TRA obligation at the end of the period | $ | 333 | $ | 596 |
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Successor | Predecessor | |||||||||||||||
Year Ended December 31, 2017 | Period from October 3, 2016 through December 31, 2016 | Period from January 1, 2016 through October 2, 2016 | Year Ended December 31, 2015 | |||||||||||||
Interest paid/accrued post-Emergence | $ | 213 | $ | 51 | $ | — | $ | — | ||||||||
Interest paid/accrued on debtor-in-possession financing | — | — | 76 | 63 | ||||||||||||
Adequate protection amounts paid/accrued | — | — | 977 | 1,233 | ||||||||||||
Unrealized mark-to-market net (gains) losses on interest rate swaps | (29 | ) | 11 | — | — | |||||||||||
Capitalized interest | (7 | ) | (3 | ) | (9 | ) | (11 | ) | ||||||||
Other | 16 | 1 | 5 | 4 | ||||||||||||
Total interest expense and related charges | $ | 193 | $ | 60 | $ | 1,049 | $ | 1,289 |
Predecessor | |||||||
Period from January 1, 2016 through October 2, 2016 | Year Ended December 31, 2015 | ||||||
Contractual interest on debt classified as LSTC | $ | 1,570 | $ | 2,070 | |||
Adequate protection amounts paid/accrued | 930 | 1,173 | |||||
Contractual interest on debt classified as LSTC not paid/accrued | $ | 640 | $ | 897 |
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December 31, 2017 | December 31, 2016 | ||||||
Vistra Operations Credit Facilities (a) | $ | 4,323 | $ | 4,515 | |||
Mandatorily redeemable subsidiary preferred stock (b) | 70 | 70 | |||||
8.82% Building Financing due semiannually through February 11, 2022 (c) | 30 | 36 | |||||
Capital lease obligations | — | 2 | |||||
Total long-term debt including amounts due currently | 4,423 | 4,623 | |||||
Less amounts due currently | (44 | ) | (46 | ) | |||
Total long-term debt less amounts due currently | $ | 4,379 | $ | 4,577 |
(a) | At December 31, 2017, borrowings under the Vistra Operations Credit Facilities in our consolidated balance sheet include debt premiums of $21 million, debt discounts of $2 million and debt issuance costs of $7 million. At December 31, 2016, borrowings under the Vistra Operations Credit Facilities in our consolidated balance sheet include debt premiums of $25 million, debt discounts of $2 million and debt issuance costs of $8 million. |
(b) | Shares of mandatorily redeemable preferred stock in PrefCo issued as part of the spin-off of Vistra Energy from EFH Corp. (see Note 5). This subsidiary preferred stock is accounted for as a debt instrument under relevant accounting guidance. |
(c) | Obligation related to a corporate office space capital lease transferred to Vistra Energy pursuant to the Plan of Reorganization. This obligation will be funded by amounts held in an escrow account that is reflected in other noncurrent assets in our consolidated balance sheets. |
December 31, 2017 | ||||||||||||||
Vistra Operations Credit Facilities | Maturity Date | Facility Limit | Cash Borrowings | Available Capacity | ||||||||||
Revolving Credit Facility (a) | August 4, 2021 | $ | 860 | $ | — | $ | 834 | |||||||
Initial Term Loan B Facility (b)(c) | August 4, 2023 | 2,850 | 2,821 | — | ||||||||||
Incremental Term Loan B Facility (c) | December 14, 2023 | 1,000 | 990 | — | ||||||||||
Term Loan C Facility (d) | August 4, 2023 | 650 | 500 | 7 | ||||||||||
Total Vistra Operations Credit Facilities | $ | 5,360 | $ | 4,311 | $ | 841 |
(a) | Facility to be used for general corporate purposes. Facility includes a $715 million letter of credit sub-facility, of which $26 million of letters of credit were outstanding at December 31, 2017. |
(b) | Facility used to repay all amounts outstanding under our Predecessor's DIP Facility and issuance costs for the DIP Roll Facilities, with the remaining balance used for general corporate purposes. |
(c) | Cash borrowings under the Term Loan B Facility reflect required scheduled quarterly payment in annual amount equal to 1% of the original principal amount with the balance paid at maturity. Amounts paid cannot be reborrowed. |
(d) | Facility used for issuing letters of credit for general corporate purposes. Borrowings under this facility were funded to collateral accounts that are reported as restricted cash in our consolidated balance sheets. Cash borrowings reflect a $150 million principal reduction paid from restricted cash in December 2017. Amounts paid cannot be reborrowed. At December 31, 2017, the restricted cash supported $493 million in letters of credit outstanding (see Note 21), leaving $7 million in available letter of credit capacity. |
December 31, 2017 | |||
2018 | $ | 44 | |
2019 | 44 | ||
2020 | 44 | ||
2021 | 45 | ||
2022 | 42 | ||
Thereafter | 4,189 | ||
Unamortized premiums, discounts and debt issuance costs | 15 | ||
Total long-term debt, including amounts due currently | $ | 4,423 |
|
Coal purchase and transportation agreements | Pipeline transportation and storage reservation fees | Nuclear Fuel Contracts | Other Contracts | ||||||||||||
2018 | $ | 12 | $ | 39 | $ | 120 | $ | 158 | |||||||
2019 | — | 28 | 48 | 46 | |||||||||||
2020 | — | 28 | 47 | 55 | |||||||||||
2021 | — | 29 | 55 | 36 | |||||||||||
2022 | — | 29 | 32 | 89 | |||||||||||
Thereafter | — | 141 | 193 | 194 | |||||||||||
Total | $ | 12 | $ | 294 | $ | 495 | $ | 578 |
Operating Leases (a) | |||
2018 | $ | 17 | |
2019 | 15 | ||
2020 | 12 | ||
2021 | 10 | ||
2022 | 8 | ||
Thereafter | 150 | ||
Total future minimum lease payments | $ | 212 |
(a) | Includes operating leases with initial or remaining noncancellable lease terms in excess of one year. |
• | $390 million to support commodity risk management collateral requirements in the normal course of business, including over-the-counter and exchange-traded transactions and collateral postings with ERCOT; |
• | $45 million to support executory contracts and insurance agreements; |
• | $55 million to support our REP financial requirements with the PUCT, and |
• | $29 million for other credit support requirements. |
|
Successor | |||||
Year Ended December 31, 2017 | Period from October 3, 2016 through December 31, 2016 | ||||
Shares outstanding at beginning of period | 427,580,232 | — | |||
Shares issued (a) | 818,570 | 427,580,232 | |||
Shares repurchased | — | — | |||
Shares outstanding at end of period | 428,398,802 | 427,580,232 |
(a) | Includes share awards granted to directors and other nonemployees. |
|
• | Level 1 valuations use quoted prices in active markets for identical assets or liabilities that are accessible at the measurement date. Our Level 1 assets and liabilities include CME or ICE (electronic commodity derivative exchanges) futures and options transacted through clearing brokers for which prices are actively quoted. We report the fair value of CME and ICE transactions without taking into consideration margin deposits, with the exception of certain margin amounts related to changes in fair value on certain CME transactions that, beginning in January 2017, are legally characterized as settlement of derivative contracts rather than collateral. |
• | Level 2 valuations utilize over-the-counter broker quotes, quoted prices for similar assets or liabilities that are corroborated by correlations or other mathematical means, and other valuation inputs such as interest rates and yield curves observable at commonly quoted intervals. We attempt to obtain multiple quotes from brokers that are active in the markets in which we participate and require at least one quote from two brokers to determine a pricing input as observable. The number of broker quotes received for certain pricing inputs varies depending on the depth of the trading market, each individual broker's publication policy, recent trading volume trends and various other factors. |
• | Level 3 valuations use unobservable inputs for the asset or liability. Unobservable inputs are used to the extent observable inputs are not available, thereby allowing for situations in which there is little, if any, market activity for the asset or liability at the measurement date. We use the most meaningful information available from the market combined with internally developed valuation methodologies to develop our best estimate of fair value. Significant unobservable inputs used to develop the valuation models include volatility curves, correlation curves, illiquid pricing delivery periods and locations and credit-related nonperformance risk assumptions. These inputs and valuation models are developed and maintained by employees trained and experienced in market operations and fair value measurements and validated by the Company's risk management group. |
December 31, 2017 | |||||||||||||||||||
Level 1 | Level 2 | Level 3 (a) | Reclassification (b) | Total | |||||||||||||||
Assets: | |||||||||||||||||||
Commodity contracts | $ | 47 | $ | 98 | $ | 75 | $ | 2 | $ | 222 | |||||||||
Interest rate swaps | — | 18 | — | 8 | 26 | ||||||||||||||
Nuclear decommissioning trust – equity securities (c) | 468 | — | — | — | 468 | ||||||||||||||
Nuclear decommissioning trust – debt securities (c) | — | 430 | — | — | 430 | ||||||||||||||
Sub-total | $ | 515 | $ | 546 | $ | 75 | $ | 10 | 1,146 | ||||||||||
Assets measured at net asset value (d): | |||||||||||||||||||
Nuclear decommissioning trust – equity securities (c) | 290 | ||||||||||||||||||
Total assets | $ | 1,436 | |||||||||||||||||
Liabilities: | |||||||||||||||||||
Commodity contracts | $ | 45 | $ | 143 | $ | 128 | $ | 2 | $ | 318 | |||||||||
Interest rate swaps | — | — | — | 8 | 8 | ||||||||||||||
Total liabilities | $ | 45 | $ | 143 | $ | 128 | $ | 10 | $ | 326 |
December 31, 2016 | |||||||||||||||||||
Level 1 | Level 2 | Level 3 (a) | Reclassification (b) | Total | |||||||||||||||
Assets: | |||||||||||||||||||
Commodity contracts | $ | 167 | $ | 131 | $ | 98 | $ | — | $ | 396 | |||||||||
Interest rate swaps | — | 5 | — | 13 | 18 | ||||||||||||||
Nuclear decommissioning trust – equity securities (c) | 425 | — | — | — | 425 | ||||||||||||||
Nuclear decommissioning trust – debt securities (c) | — | 340 | — | — | 340 | ||||||||||||||
Sub-total | $ | 592 | $ | 476 | $ | 98 | $ | 13 | 1,179 | ||||||||||
Assets measured at net asset value (d): | |||||||||||||||||||
Nuclear decommissioning trust – equity securities (c) | 247 | ||||||||||||||||||
Total assets | $ | 1,426 | |||||||||||||||||
Liabilities: | |||||||||||||||||||
Commodity contracts | $ | 302 | $ | 15 | $ | 15 | $ | — | $ | 332 | |||||||||
Interest rate swaps | — | 16 | — | 13 | 29 | ||||||||||||||
Total liabilities | $ | 302 | $ | 31 | $ | 15 | $ | 13 | $ | 361 |
(a) | See table below for description of Level 3 assets and liabilities. |
(b) | Fair values are determined on a contract basis, but certain contracts result in a current asset and a noncurrent liability, or vice versa, as presented in our consolidated balance sheets. |
(c) | The nuclear decommissioning trust investment is included in the other investments line in our consolidated balance sheets. See Note 21. |
(d) | The fair value amounts presented in this line are intended to permit reconciliation of the fair value hierarchy to the amounts presented in our consolidated balance sheets. Certain investments measured at fair value using the net asset value per share (or its equivalent) have not been classified in the fair value hierarchy. |
December 31, 2017 | ||||||||||||||||||
Fair Value | ||||||||||||||||||
Contract Type (a) | Assets | Liabilities | Total | Valuation Technique | Significant Unobservable Input | Range (b) | ||||||||||||
Electricity purchases and sales | $ | 12 | $ | (33 | ) | $ | (21 | ) | Valuation Model | Hourly price curve shape (c) | $0 to $40/ MWh | |||||||
Illiquid delivery periods for ERCOT hub power prices and heat rates (d) | $20 to $70/ MWh | |||||||||||||||||
Electricity options | — | (91 | ) | (91 | ) | Option Pricing Model | Gas to power correlation (e) | 30% to 100% | ||||||||||
Power volatility (e) | 5% to 180% | |||||||||||||||||
Electricity congestion revenue rights | 45 | (4 | ) | 41 | Market Approach (f) | Illiquid price differences between settlement points (g) | $0 to $15/ MWh | |||||||||||
Other (h) | 18 | — | 18 | |||||||||||||||
Total | $ | 75 | $ | (128 | ) | $ | (53 | ) |
December 31, 2016 | ||||||||||||||||||
Fair Value | ||||||||||||||||||
Contract Type (a) | Assets | Liabilities | Total | Valuation Technique | Significant Unobservable Input | Range (b) | ||||||||||||
Electricity purchases and sales | $ | 32 | $ | — | $ | 32 | Valuation Model | Hourly price curve shape (c) | $0 to $35/ MWh | |||||||||
Illiquid delivery periods for ERCOT hub power prices and heat rates (d) | $30 to $70/ MWh | |||||||||||||||||
Electricity congestion revenue rights | 42 | (6 | ) | 36 | Market Approach (f) | Illiquid price differences between settlement points (g) | $0 to $10/ MWh | |||||||||||
Other (h) | 24 | (9 | ) | 15 | ||||||||||||||
Total | $ | 98 | $ | (15 | ) | $ | 83 |
(a) | Electricity purchase and sales contracts include power and heat rate positions in ERCOT regions. Electricity congestion revenue rights contracts consist of forward purchase contracts (swaps and options) used to hedge electricity price differences between settlement points within ERCOT. Electricity options consist of physical electricity options and spread options. |
(b) | The range of the inputs may be influenced by factors such as time of day, delivery period, season and location. |
(c) | Based on the historical range of forward average hourly ERCOT North Hub prices. |
(d) | Based on historical forward ERCOT power price and heat rate variability. |
(e) | Based on historical forward correlation and volatility within ERCOT. |
(f) | While we use the market approach, there is insufficient market data to consider the valuation liquid. |
(g) | Based on the historical price differences between settlement points within ERCOT hubs and load zones. |
(h) | Other includes contracts for natural gas, weather options and coal options. December 31, 2016 also includes an immaterial amount of electricity options. |
Successor | Predecessor | |||||||||||||||
Year Ended December 31, 2017 | Period from October 3, 2016 through December 31, 2016 | Period from January 1, 2016 through October 2, 2016 | Year Ended December 31, 2015 | |||||||||||||
Net asset balance at beginning of period (a) | $ | 83 | $ | 81 | $ | 37 | $ | 35 | ||||||||
Total unrealized valuation gains (losses) | (136 | ) | 31 | 122 | 27 | |||||||||||
Purchases, issuances and settlements (b): | ||||||||||||||||
Purchases | 69 | 15 | 37 | 49 | ||||||||||||
Issuances | (22 | ) | (7 | ) | (20 | ) | (13 | ) | ||||||||
Settlements | (106 | ) | (30 | ) | (51 | ) | (48 | ) | ||||||||
Transfers into Level 3 (c) | 4 | 3 | 1 | 1 | ||||||||||||
Transfers out of Level 3 (c) | 71 | (10 | ) | 1 | (14 | ) | ||||||||||
Earn-out provision (d) | (16 | ) | — | — | — | |||||||||||
Net liabilities assumed in the Lamar and Forney Acquisition (Note 3) (e) | — | — | (30 | ) | — | |||||||||||
Net change (f) | (136 | ) | 2 | 60 | 2 | |||||||||||
Net asset (liability) balance at end of period | $ | (53 | ) | $ | 83 | $ | 97 | $ | 37 | |||||||
Unrealized valuation gains (losses) relating to instruments held at end of period | $ | (98 | ) | $ | 28 | $ | 98 | $ | 18 |
(a) | The beginning balance for the Successor period from October 3, 2016 through December 31, 2016 reflects a $16 million adjustment to the fair value of certain Level 3 assets driven by power prices utilized by the Successor for unobservable delivery periods. |
(b) | Settlements reflect reversals of unrealized mark-to-market valuations previously recognized in net income. Purchases and issuances reflect option premiums paid or received. |
(c) | Includes transfers due to changes in the observability of significant inputs. All Level 3 transfers during the periods presented are in and out of Level 2. For the year ended December 31, 2017, transfers out of Level 3 primarily consists of electricity derivatives where forward pricing inputs have become observable. |
(d) | Represents initial fair value of the earn-out provision incurred as part of the Odessa Acquisition. See Note 3. |
(e) | Includes fair value of Level 3 assets and liabilities as of the purchase date and any related rolloff between the purchase date and the period ended October 2, 2016. |
(f) | Activity excludes change in fair value in the month positions settle. For the Successor period, substantially all changes in values of commodity contracts (excluding the initial fair value of the earn-out provision related to the Odessa Acquisition in 2017) are reported as operating revenues in our statements of consolidated income (loss). For the Predecessor period, substantially all changes in values of commodity contracts (excluding net liabilities assumed in the Lamar and Forney Acquisition in 2016) are reported as net gain from commodity hedging and trading activities in the statements of consolidated income (loss). |
|
December 31, 2017 | |||||||||||||||||||
Derivative Assets | Derivative Liabilities | ||||||||||||||||||
Commodity Contracts | Interest Rate Swaps | Commodity Contracts | Interest Rate Swaps | Total | |||||||||||||||
Current assets | $ | 190 | $ | — | $ | — | $ | — | $ | 190 | |||||||||
Noncurrent assets | 30 | 22 | 2 | 4 | 58 | ||||||||||||||
Current liabilities | — | (4 | ) | (216 | ) | (4 | ) | (224 | ) | ||||||||||
Noncurrent liabilities | — | — | (102 | ) | — | (102 | ) | ||||||||||||
Net assets (liabilities) | $ | 220 | $ | 18 | $ | (316 | ) | $ | — | $ | (78 | ) |
December 31, 2016 | |||||||||||||||||||
Derivative Assets | Derivative Liabilities | ||||||||||||||||||
Commodity Contracts | Interest Rate Swaps | Commodity Contracts | Interest Rate Swaps | Total | |||||||||||||||
Current assets | $ | 350 | $ | — | $ | — | $ | — | $ | 350 | |||||||||
Noncurrent assets | 46 | 17 | — | 1 | 64 | ||||||||||||||
Current liabilities | — | (12 | ) | (330 | ) | (17 | ) | (359 | ) | ||||||||||
Noncurrent liabilities | — | — | (2 | ) | — | (2 | ) | ||||||||||||
Net assets (liabilities) | $ | 396 | $ | 5 | $ | (332 | ) | $ | (16 | ) | $ | 53 |
Successor | Predecessor | |||||||||||||||
Derivative (statements of consolidated income (loss) presentation) | Year Ended December 31, 2017 | Period from October 3, 2016 through December 31, 2016 | Period from January 1, 2016 through October 2, 2016 | Year Ended December 31, 2015 | ||||||||||||
Commodity contracts (Operating revenues) | $ | 56 | $ | (92 | ) | $ | — | $ | — | |||||||
Commodity contracts (Fuel, purchased power costs and delivery fees) | 6 | 21 | — | — | ||||||||||||
Commodity contracts (Net gain from commodity hedging and trading activities) | — | — | 194 | 380 | ||||||||||||
Interest rate swaps (Interest expense and related charges) | 2 | (11 | ) | — | — | |||||||||||
Net gain (loss) | $ | 64 | $ | (82 | ) | $ | 194 | $ | 380 |
December 31, 2017 | December 31, 2016 | |||||||||||||||||||||||||||||||
Derivative Assets and Liabilities | Offsetting Instruments (a) | Cash Collateral (Received) Pledged (b) | Net Amounts | Derivative Assets and Liabilities | Offsetting Instruments (a) | Cash Collateral (Received) Pledged (b) | Net Amounts | |||||||||||||||||||||||||
Derivative assets: | ||||||||||||||||||||||||||||||||
Commodity contracts | $ | 220 | $ | (113 | ) | $ | (1 | ) | $ | 106 | $ | 396 | $ | (193 | ) | $ | (20 | ) | $ | 183 | ||||||||||||
Interest rate swaps | 18 | — | — | 18 | 5 | — | — | 5 | ||||||||||||||||||||||||
Total derivative assets | 238 | (113 | ) | (1 | ) | 124 | 401 | (193 | ) | (20 | ) | 188 | ||||||||||||||||||||
Derivative liabilities: | ||||||||||||||||||||||||||||||||
Commodity contracts | (316 | ) | 113 | 1 | (202 | ) | (332 | ) | 193 | 136 | (3 | ) | ||||||||||||||||||||
Interest rate swaps | — | — | — | — | (16 | ) | — | — | (16 | ) | ||||||||||||||||||||||
Total derivative liabilities | (316 | ) | 113 | 1 | (202 | ) | (348 | ) | 193 | 136 | (19 | ) | ||||||||||||||||||||
Net amounts | $ | (78 | ) | $ | — | $ | — | $ | (78 | ) | $ | 53 | $ | — | $ | 116 | $ | 169 |
(a) | Amounts presented exclude trade accounts receivable and payable related to settled financial instruments. |
(b) | Represents cash amounts received or pledged pursuant to a master netting arrangement, including fair value-based margin requirements and, to a lesser extent, initial margin requirements. |
December 31, 2017 | December 31, 2016 | |||||||||
Derivative type | Notional Volume | Unit of Measure | ||||||||
Natural gas (a) | 1,259 | 1,282 | Million MMBtu | |||||||
Electricity | 114,129 | 75,322 | GWh | |||||||
Congestion Revenue Rights (b) | 110,913 | 126,573 | GWh | |||||||
Coal | 2 | 12 | Million U.S. tons | |||||||
Fuel oil | 5 | 34 | Million gallons | |||||||
Uranium | 325 | 25 | Thousand pounds | |||||||
Interest rate swaps – floating/fixed (c) | $ | 3,000 | $ | 3,000 | Million U.S. dollars |
(a) | Represents gross notional forward sales, purchases and options transactions, locational basis swaps and other natural gas transactions. |
(b) | Represents gross forward purchases associated with instruments used to hedge electricity price differences between settlement points within ERCOT. |
(c) | Includes notional amounts of interest rate swaps that became effective in January 2017 and have maturity dates through July 2023. |
December 31, | |||||||
2017 | 2016 | ||||||
Fair value of derivative contract liabilities (a) | $ | (204 | ) | $ | (31 | ) | |
Offsetting fair value under netting arrangements (b) | 103 | 13 | |||||
Cash collateral and letters of credit | 41 | 1 | |||||
Liquidity exposure | $ | (60 | ) | $ | (17 | ) |
(a) | Excludes fair value of contracts that contain contingent features that do not provide specific amounts to be posted if features are triggered, including provisions that generally provide the right to request additional collateral (material adverse change, performance assurance and other clauses). |
(b) | Amounts include the offsetting fair value of in-the-money derivative contracts and net accounts receivable under master netting arrangements. |
|
Successor | Predecessor | |||||||||||||||
Year Ended December 31, 2017 | Period from October 3, 2016 through December 31, 2016 | Period from January 1, 2016 through October 2, 2016 | Year Ended December 31, 2015 | |||||||||||||
Pension costs | $ | 6 | $ | 2 | $ | 4 | $ | 8 | ||||||||
OPEB costs | 6 | 2 | — | 3 | ||||||||||||
Total benefit costs recognized as expense | $ | 12 | $ | 4 | $ | 4 | $ | 11 |
Successor | |||||||
Year Ended December 31, 2017 | Period from October 3, 2016 through December 31, 2016 | ||||||
Assumptions Used to Determine Net Periodic Pension Cost: | |||||||
Discount rate | 4.31 | % | 3.79 | % | |||
Expected return on plan assets | 4.86 | % | 4.89 | % | |||
Expected rate of compensation increase | 3.50 | % | 3.50 | % | |||
Components of Net Pension Cost: | |||||||
Service cost | $ | 5 | $ | 2 | |||
Interest cost | 6 | 1 | |||||
Expected return on assets | (5 | ) | (1 | ) | |||
Net periodic pension cost | $ | 6 | $ | 2 | |||
Other Changes in Plan Assets and Benefit Obligations Recognized in Other Comprehensive Income: | |||||||
Net (gain) loss | $ | 3 | $ | (4 | ) | ||
Total recognized in net periodic benefit cost and other comprehensive income | $ | 9 | $ | (2 | ) | ||
Assumptions Used to Determine Benefit Obligations: | |||||||
Discount rate | 3.74 | % | 4.31 | % | |||
Expected rate of compensation increase | 3.62 | % | 3.50 | % |
Successor | |||||||
Year Ended December 31, 2017 | Period from October 3, 2016 through December 31, 2016 | ||||||
Change in Pension Obligation: | |||||||
Projected benefit obligation at beginning of period | $ | 144 | $ | 154 | |||
Service cost | 5 | 2 | |||||
Interest cost | 6 | 1 | |||||
Actuarial (gain) loss | 13 | (12 | ) | ||||
Benefits paid | (5 | ) | (1 | ) | |||
Projected benefit obligation at end of year | $ | 163 | $ | 144 | |||
Accumulated benefit obligation at end of year | $ | 157 | $ | 136 | |||
Change in Plan Assets: | |||||||
Fair value of assets at beginning of period | $ | 117 | $ | 124 | |||
Actual gain (loss) on assets | 16 | (6 | ) | ||||
Benefits paid | (5 | ) | (1 | ) | |||
Fair value of assets at end of year | $ | 128 | $ | 117 | |||
Funded Status: | |||||||
Projected pension benefit obligation | $ | (163 | ) | $ | (144 | ) | |
Fair value of assets | 128 | 117 | |||||
Funded status at end of year | $ | (35 | ) | $ | (27 | ) | |
Amounts Recognized in the Balance Sheet Consist of: | |||||||
Other current liabilities | $ | — | $ | — | |||
Other noncurrent liabilities | (35 | ) | (27 | ) | |||
Net liability recognized | $ | (35 | ) | $ | (27 | ) | |
Amounts Recognized in Accumulated Other Comprehensive Income Consist of: | |||||||
Net gain | $ | 1 | $ | 4 |
December 31, | |||||||
2017 | 2016 | ||||||
Pension Plans with PBO and ABO in Excess Of Plan Assets: | |||||||
Projected benefit obligations | $ | 163 | $ | 144 | |||
Accumulated benefit obligation | $ | 157 | $ | 136 | |||
Plan assets | $ | 128 | $ | 117 |
Asset Category: | Target Allocation Ranges | |||
Fixed income | 74 | % | - | 86% |
U.S. equities | 8 | % | - | 14% |
International equities | 6 | % | - | 12% |
Retirement Plan | ||
Asset Class: | Expected Long-Term Rate of Return | |
U.S. equity securities | 6.4 | % |
International equity securities | 7.3 | % |
Fixed income securities | 3.9 | % |
Weighted average | 4.6 | % |
December 31, | |||||||
2017 | 2016 | ||||||
Asset Category: | |||||||
Level 2 valuations (see Note 15): | |||||||
Interest-bearing cash | $ | (7 | ) | $ | (4 | ) | |
Fixed income securities: | |||||||
Corporate bonds (a) | 65 | 54 | |||||
U.S. Treasuries | 29 | 30 | |||||
Other (b) | 7 | 6 | |||||
Total assets categorized as Level 2 | 94 | 86 | |||||
Assets measured at net asset value (c): | |||||||
Interest-bearing cash | 2 | 2 | |||||
Equity securities: | |||||||
U.S. | 14 | 14 | |||||
International | 13 | 9 | |||||
Fixed income securities: | |||||||
Corporate bonds (a) | 5 | 6 | |||||
Total assets measured at net asset value | 34 | 31 | |||||
Total assets | $ | 128 | $ | 117 |
(a) | Substantially all corporate bonds are rated investment grade by a major ratings agency such as Moody's. |
(b) | Other consists primarily of taxable municipal bonds. |
(c) | Certain investments measured at fair value using the net asset value per share (or its equivalent) have not been classified in the fair value hierarchy. The fair value amounts presented in this line are intended to permit reconciliation of the fair value hierarchy to total Vistra Retirement Plan assets. |
Successor | |||||||
Year Ended December 31, 2017 | Period from October 3, 2016 through December 31, 2016 | ||||||
Assumptions Used to Determine Net Periodic Benefit Cost: | |||||||
Discount rate (Vistra Energy Plan) | 4.11 | % | 4.00 | % | |||
Discount rate (Oncor Plan) | 4.18 | % | 3.69 | % | |||
Components of Net Postretirement Benefit Cost: | |||||||
Service cost | $ | 2 | $ | 1 | |||
Interest cost | 4 | 1 | |||||
Plan amendments (a) | — | (4 | ) | ||||
Net periodic OPEB cost (income) | $ | 6 | $ | (2 | ) | ||
Other Changes in Plan Assets and Benefit Obligations Recognized in Other Comprehensive Income: | |||||||
Net (gain) loss and prior service (credit) cost | $ | 26 | $ | (5 | ) | ||
Total recognized in net periodic benefit cost and other comprehensive income | $ | 32 | $ | (7 | ) | ||
Assumptions Used to Determine Benefit Obligations at Period End: | |||||||
Discount rate (Vistra Energy Plan) | 3.67 | % | 4.11 | % | |||
Discount rate (Split-Participant Plan) | 3.67 | % | — | % | |||
Discount rate (Oncor Plan) | — | % | 4.18 | % |
(a) | Curtailment gain recognized as other income in the statements of consolidated income (loss) as a result of discontinued life insurance benefits for active employees. |
Successor | |||||||
Year Ended December 31, 2017 | Period from October 3, 2016 through December 31, 2016 | ||||||
Change in Postretirement Benefit Obligation: | |||||||
Benefit obligation at beginning of year | $ | 88 | $ | 97 | |||
Service cost | 2 | 1 | |||||
Interest cost | 4 | 1 | |||||
Participant contributions | 2 | 1 | |||||
Plan amendments (a) | 11 | (4 | ) | ||||
Actuarial (gain) loss | 15 | (5 | ) | ||||
Benefits paid | (7 | ) | (3 | ) | |||
Benefit obligation at end of year | $ | 115 | $ | 88 | |||
Change in Plan Assets: | |||||||
Fair value of assets at beginning of year | $ | — | $ | — | |||
Employer contributions | 5 | 1 | |||||
Participant contributions | 2 | 1 | |||||
Benefits paid | (7 | ) | (2 | ) | |||
Fair value of assets at end of year | $ | — | $ | — | |||
Funded Status: | |||||||
Benefit obligation | $ | 115 | $ | 88 | |||
Funded status at end of year | $ | 115 | $ | 88 | |||
Amounts Recognized on the Balance Sheet Consist of: | |||||||
Other current liabilities | $ | 6 | $ | 5 | |||
Other noncurrent liabilities | 109 | 83 | |||||
Net liability recognized | $ | 115 | $ | 88 | |||
Amounts Recognized in Accumulated Other Comprehensive Income Consist of: | |||||||
Net loss and prior service cost | $ | 20 | $ | 5 |
(a) | For the year ended December 31, 2017, plan amendments relate to the contractual arrangement with Oncor covering Split Participants. For the period from October 3, 2016 through December 31, 2016, a curtailment gain was recognized as other income in the statements of consolidated income (loss) as a result of discontinued life insurance benefits for active employees. |
Successor | |||||
December 31, 2017 | December 31, 2016 | ||||
Assumed Health Care Cost Trend Rates-Not Medicare Eligible: | |||||
Health care cost trend rate assumed for next year | 7.00 | % | 5.80 | % | |
Rate to which the cost trend is expected to decline (the ultimate trend rate) | 4.50 | % | 5.00 | % | |
Year that the rate reaches the ultimate trend rate | 2026 | 2024 | |||
Assumed Health Care Cost Trend Rates-Medicare Advantage Eligible (2017) / Medicare Eligible (2016): | |||||
Health care cost trend rate assumed for next year | 10.66 | % | 5.70 | % | |
Rate to which the cost trend is expected to decline (the ultimate trend rate) | 4.50 | % | 5.00 | % | |
Year that the rate reaches the ultimate trend rate | 2026 | 2024 |
1-Percentage Point Increase | 1-Percentage Point Decrease | ||||||
Sensitivity Analysis of Assumed Health Care Cost Trend Rates: | |||||||
Effect on accumulated postretirement obligation | $ | 2 | $ | (2 | ) | ||
Effect on postretirement benefits cost | $ | — | $ | — |
2018 | 2019 | 2020 | 2021 | 2022 | 2023-27 | ||||||||||||||||||
Pension benefits | $ | 11 | $ | 8 | $ | 8 | $ | 8 | $ | 9 | $ | 50 | |||||||||||
OPEB | $ | 6 | $ | 7 | $ | 8 | $ | 8 | $ | 8 | $ | 39 |
|
Successor | |||||||
Year Ended December 31, 2017 | Period from October 3, 2016 through December 31, 2016 | ||||||
Total stock-based compensation expense | $ | 19 | $ | 3 | |||
Income tax benefit | (7 | ) | (1 | ) | |||
Stock based-compensation expense, net of tax | $ | 12 | $ | 2 |
Successor | ||||||||||||
Year Ended December 31, 2017 | ||||||||||||
Stock Options (in thousands) | Weighted Average Exercise Price | Weighted Average Remaining Contractual Term (Years) | Aggregate Intrinsic Value (in millions) | |||||||||
Total outstanding at beginning of period | 7,357 | $ | 15.81 | 9.8 | $ | — | ||||||
Granted | 1,412 | $ | 18.86 | |||||||||
Exercised | (281 | ) | $ | 13.41 | ||||||||
Forfeited or expired | (352 | ) | $ | 13.76 | ||||||||
Total outstanding at end of period | 8,136 | $ | 14.44 | 9.0 | $ | 32.4 | ||||||
Expected to vest | 6,618 | $ | 14.65 | 9.1 | $ | 25.1 |
Successor | ||||||||||||
Year Ended December 31, 2017 | ||||||||||||
Restricted Stock Units (in thousands) | Weighted Average Grant Date Fair Value | Weighted Average Remaining Contractual Term (Years) | Aggregate Intrinsic Value (in millions) | |||||||||
Total outstanding at beginning of period | 2,159 | $ | 15.79 | 2.3 | $ | 33.5 | ||||||
Granted | 861 | $ | 18.84 | |||||||||
Exercised | (538 | ) | $ | 15.76 | ||||||||
Forfeited or expired | (107 | ) | $ | 15.85 | ||||||||
Total outstanding at end of period | 2,375 | $ | 16.91 | 1.9 | $ | 43.5 | ||||||
Expected to vest | 2,375 | $ | 16.91 | 1.9 | $ | 43.5 |
|
• | we will be required to use reasonable best efforts to convert the Form S-1 registration statement into a registration statement on Form S-3 as soon as reasonably practicable after we become eligible to do so and to have such Form S-3 declared effective as promptly as practicable (but in no event more than 30 days after it is filed with the SEC); |
• | if we propose to file certain types of registration statements under the Securities Act with respect to an offering of equity securities, we will be required to use our reasonable best efforts to offer the other parties to the Registration Rights Agreement the opportunity to register all or part of their shares on the terms and conditions set forth in the Registration Rights Agreement; and |
• | the selling stockholders received the right, subject to certain conditions and exceptions, to request that we file registration statements or amend or supplement registration statements, with the SEC for an underwritten offering of all or part of their respective shares of Vistra Energy common stock (a Demand Registration), and the Company is required to cause any such registration statement or amendment or supplement (a) to be filed with the SEC promptly and, in any event, on or before the date that is 45 days, in the case of a registration statement on Form S-1, or 30 days, in the case of a registration statement on Form S-3, after we receive the written request from the relevant selling stockholders to effectuate the Demand Registration and (b) to become effective as promptly as reasonably practicable and in any event no later than 120 days after it is initially filed. |
• | Our retail operations (and prior to the Effective Date, our Predecessor) pay Oncor for services it provides, principally the delivery of electricity. Expenses recorded for these services, reported in fuel, purchased power costs and delivery fees, totaled $700 million and $955 million for the Predecessor period from January 1, 2016 through October 2, 2016 and the year ended December 31, 2015, respectively. |
• | A former subsidiary of EFH Corp. billed our Predecessor's subsidiaries for information technology, financial, accounting and other administrative services at cost. These charges, which are largely settled in cash and primarily reported in SG&A expenses, totaled $157 million and $205 million for the Predecessor period from January 1, 2016 through October 2, 2016 and the year ended December 31, 2015, respectively. |
• | Under Texas regulatory provisions, the trust fund for decommissioning the Comanche Peak nuclear generation facility is funded by a delivery fee surcharge billed to REPs by Oncor, as collection agent, and remitted monthly to Vistra Energy (and prior to the Effective Date, our Predecessor) for contribution to the trust fund with the intent that the trust fund assets, reported in other investments in our consolidated balance sheets, will ultimately be sufficient to fund the future decommissioning liability, reported in asset retirement obligations in our consolidated balance sheets. The delivery fee surcharges remitted to our Predecessor totaled $15 million and $17 million for the Predecessor period from January 1, 2016 through October 2, 2016 and the year ended December 31, 2015, respectively. Income and expenses associated with the trust fund and the decommissioning liability incurred by Vistra Energy (and prior to the Effective Date, our Predecessor) are offset by a net change in a receivable/payable that ultimately will be settled through changes in Oncor's delivery fee rates. |
• | EFH Corp. files consolidated federal income tax and Texas state margin tax returns that included our results prior to the Effective Date; however, under a Federal and State Income Tax Allocation Agreement, our federal income tax and Texas margin tax expense and related balance sheet amounts, including income taxes payable to or receivable from EFH Corp., were recorded as if our Predecessor filed its own corporate income tax return. For the Predecessor period from January 1, 2016 through October 2, 2016 and the year ended December 31, 2015, our Predecessor made income tax payments to EFH Corp. totaling $22 million and $29 million, respectively. In 2015, $609 million of income tax liability was eliminated under the terms of the Settlement Agreement. See Note 8 for discussion of cessation of payment of federal income taxes pursuant to the Settlement Agreement. |
• | Contributions to the EFH Corp. retirement plan by both Oncor and TCEH in 2014, 2015 and 2016 resulted in the EFH Corp. retirement plan being fully funded as calculated under the provisions of the Employee Retirement Income Security Act of 1974, as amended (ERISA). In September 2016, a cash contribution totaling $2 million was made to the EFH Corp. retirement plan, all of which was contributed by TCEH, which resulted in the EFH Retirement Plan continuing to be fully funded as calculated under the provisions of ERISA. On the Effective Date, the EFH Retirement Plan was transferred to Vistra Energy pursuant to a separation agreement between Vistra Energy and EFH Corp. |
• | In 2007, TCEH entered into the TCEH Senior Secured Facilities with syndicates of financial institutions and other lenders. These syndicates included affiliates of GS Capital Partners, which is a member of the Sponsor Group. Affiliates of each member of the Sponsor Group have from time to time engaged in commercial banking transactions with TCEH and/or provided financial advisory services to TCEH, in each case in the normal course of business. |
• | Affiliates of GS Capital Partners were parties to certain commodity and interest rate hedging transactions with our Predecessor in the normal course of business. |
• | Affiliates of the Sponsor Group have sold or acquired, and in the future may sell or acquire, debt or debt securities issued by our Predecessor in open market transactions or through loan syndications. |
• | As a result of debt repurchase and exchange transactions in 2009 through 2011, EFH Corp. and EFIH held TCEH debt securities totaling $382 million as of the Petition Date. These notes payable were classified as LSTC. The amounts of TCEH debt held by EFIH or EFH Corp. were eliminated as a result of the Settlement Agreement approved by the Bankruptcy Court in December 2015 (see Note 5). In conjunction with the Settlement Agreement approved by the Bankruptcy Court in December 2015, EFH Corp. and EFIH waived their rights to the claims associated with these debt securities resulting in a gain recorded in reorganization items (see Note 5). Interest expense on the notes totaled $1 million for the year ended December 31, 2015. Contractual interest, not paid or recorded, totaled $37 million for the year ended December 31, 2015. See Note 10. |
|
. | SEGMENT INFORMATION |
Successor | |||||||
Year Ended December 31, 2017 | Period from October 3, 2016 through December 31, 2016 | ||||||
Operating revenues (a) | |||||||
Wholesale Generation | $ | 2,758 | $ | 450 | |||
Retail Electricity | 4,058 | 912 | |||||
Eliminations | (1,386 | ) | (171 | ) | |||
Consolidated operating revenues | $ | 5,430 | $ | 1,191 | |||
Depreciation and amortization | |||||||
Wholesale Generation | $ | 230 | $ | 53 | |||
Retail Electricity | 430 | 153 | |||||
Corporate and Other | 40 | 11 | |||||
Eliminations | (1 | ) | $ | (1 | ) | ||
Consolidated depreciation and amortization | $ | 699 | $ | 216 | |||
Operating income (loss) | |||||||
Wholesale Generation | $ | (186 | ) | $ | (255 | ) | |
Retail Electricity | 461 | 111 | |||||
Corporate and Other | (77 | ) | (17 | ) | |||
Consolidated operating income (loss) | $ | 198 | $ | (161 | ) | ||
Interest expense and related charges | |||||||
Wholesale Generation | $ | 21 | $ | (1 | ) | ||
Corporate and Other | 252 | 66 | |||||
Eliminations | (80 | ) | (5 | ) | |||
Consolidated interest expense and related charges | $ | 193 | $ | 60 | |||
Income tax expense (benefit)(all Corporate and Other) | $ | 504 | $ | (70 | ) | ||
Net income (loss) | |||||||
Wholesale Generation | $ | (177 | ) | $ | (251 | ) | |
Retail Electricity | 495 | 114 | |||||
Corporate and Other | (572 | ) | (26 | ) | |||
Consolidated net income (loss) | $ | (254 | ) | $ | (163 | ) | |
Capital expenditures | |||||||
Wholesale Generation | $ | 150 | $ | 84 | |||
Retail Electricity | — | 5 | |||||
Corporate and Other | 26 | — | |||||
Consolidated capital expenditures | $ | 176 | $ | 89 |
(a) | For the Successor period for the year ended December 31, 2017 and the period from October 3, 2016 through December 31, 2016, includes third-party unrealized net gains (losses) from mark-to-market valuations of commodity positions of $(151) million and $(182) million, respectively, recorded to the Wholesale Generation segment and $18 million and $(6) million, respectively, recorded to the Retail Electricity segment. In addition, for the Successor period for the year ended December 31, 2017 and the period from October 3, 2016 through December 31, 2016, unrealized net gains (losses) with affiliate of $(154) million and $(113) million, respectively, were recorded to operating revenues for the Wholesale Generation segment and corresponding unrealized net gains (losses) with affiliate of $154 million and $113 million, respectively, were recorded to fuel, purchased power costs and delivery fees for the Retail Electricity segment, with no impact to consolidated results. |
December 31, | |||||||
2017 | 2016 | ||||||
Total assets | |||||||
Wholesale Generation | $ | 7,069 | $ | 6,952 | |||
Retail Electricity | 6,156 | 5,753 | |||||
Corporate and Other and Eliminations | 1,375 | 2,462 | |||||
Consolidated total assets | $ | 14,600 | $ | 15,167 |
|
Successor | Predecessor | |||||||||||||||
Year Ended December 31, 2017 | Period from October 3, 2016 through December 31, 2016 | Period from January 1, 2016 through October 2, 2016 | Year Ended December 31, 2015 | |||||||||||||
Other income: | ||||||||||||||||
Office space sublease rental income (a) | $ | 11 | $ | 2 | $ | — | $ | — | ||||||||
Mineral rights royalty income (b) | 3 | 1 | 3 | 4 | ||||||||||||
Sale of land (b) | 4 | — | — | — | ||||||||||||
Curtailment gain on employee benefit plans (a) | — | 4 | — | — | ||||||||||||
Insurance settlement | — | — | 9 | — | ||||||||||||
Interest income | 15 | 1 | 3 | 1 | ||||||||||||
All other | 4 | 2 | 4 | 13 | ||||||||||||
Total other income | $ | 37 | $ | 10 | $ | 19 | $ | 18 | ||||||||
Other deductions: | ||||||||||||||||
Write-off of generation equipment (b) | 2 | — | 45 | — | ||||||||||||
Adjustment to asbestos liability | — | — | 11 | — | ||||||||||||
Impairment of favorable purchase contracts (Note 7) | — | — | — | 8 | ||||||||||||
Impairment of emission allowances (Note 7) | — | — | — | 55 | ||||||||||||
Impairment of mining development costs | — | — | — | 19 | ||||||||||||
All other | 3 | — | 19 | 11 | ||||||||||||
Total other deductions | $ | 5 | $ | — | $ | 75 | $ | 93 |
(a) | Reported in Corporate and Other non-segment (Successor period only). |
(b) | Reported in Wholesale Generation segment (Successor period only). |
December 31, 2017 | December 31, 2016 | ||||||||||||||
Current Assets | Noncurrent Assets | Current Assets | Noncurrent Assets | ||||||||||||
Amounts related to the Vistra Operations Credit Facilities (Note 12) | $ | — | $ | 500 | $ | — | $ | 650 | |||||||
Amounts related to restructuring escrow accounts | 59 | — | 90 | — | |||||||||||
Other | — | — | 5 | — | |||||||||||
Total restricted cash | $ | 59 | $ | 500 | $ | 95 | $ | 650 |
December 31, | |||||||
2017 | 2016 | ||||||
Wholesale and retail trade accounts receivable | $ | 596 | $ | 622 | |||
Allowance for uncollectible accounts | (14 | ) | (10 | ) | |||
Trade accounts receivable — net | $ | 582 | $ | 612 |
Successor | Predecessor | |||||||||||||||
Year Ended December 31, 2017 | Period from October 3, 2016 through December 31, 2016 | Period from January 1, 2016 through October 2, 2016 | Year Ended December 31, 2015 | |||||||||||||
Allowance for uncollectible accounts receivable at beginning of period | $ | 10 | $ | — | $ | 9 | $ | 15 | ||||||||
Increase for bad debt expense | 43 | 10 | 20 | 34 | ||||||||||||
Decrease for account write-offs | (39 | ) | — | (16 | ) | (40 | ) | |||||||||
Allowance for uncollectible accounts receivable at end of period | $ | 14 | $ | 10 | $ | 13 | $ | 9 |
December 31, | |||||||
2017 | 2016 | ||||||
Materials and supplies | $ | 149 | $ | 173 | |||
Fuel stock | 83 | 88 | |||||
Natural gas in storage | 21 | 24 | |||||
Total inventories | $ | 253 | $ | 285 |
December 31, | |||||||
2017 | 2016 | ||||||
Nuclear plant decommissioning trust | $ | 1,188 | $ | 1,012 | |||
Land | 49 | 49 | |||||
Miscellaneous other | 3 | 3 | |||||
Total other investments | $ | 1,240 | $ | 1,064 |
December 31, 2017 | |||||||||||||||
Cost (a) | Unrealized gain | Unrealized loss | Fair market value | ||||||||||||
Debt securities (b) | $ | 418 | $ | 14 | $ | (2 | ) | $ | 430 | ||||||
Equity securities (c) | 265 | 495 | (2 | ) | 758 | ||||||||||
Total | $ | 683 | $ | 509 | $ | (4 | ) | $ | 1,188 |
December 31, 2016 | |||||||||||||||
Cost (a) | Unrealized gain | Unrealized loss | Fair market value | ||||||||||||
Debt securities (b) | $ | 333 | $ | 10 | $ | (3 | ) | $ | 340 | ||||||
Equity securities (c) | 309 | 368 | (5 | ) | 672 | ||||||||||
Total | $ | 642 | $ | 378 | $ | (8 | ) | $ | 1,012 |
(a) | Includes realized gains and losses on securities sold. |
(b) | The investment objective for debt securities is to invest in a diversified tax efficient portfolio with an overall portfolio rating of AA or above as graded by S&P or Aa2 by Moody's Investors Services, Inc. The debt securities are heavily weighted with government and municipal bonds and investment grade corporate bonds. The debt securities had an average coupon rate of 3.55% and 3.56% at December 31, 2017 and 2016, respectively, and an average maturity of 9 years at both December 31, 2017 and 2016. |
(c) | The investment objective for equity securities is to invest tax efficiently and to match the performance of the S&P 500 Index. |
Successor | Predecessor | |||||||||||||||
Year Ended December 31, 2017 | Period from October 3, 2016 through December 31, 2016 | Period from January 1, 2016 through October 2, 2016 | Year Ended December 31, 2015 | |||||||||||||
Realized gains | $ | 9 | $ | 1 | $ | 3 | $ | 1 | ||||||||
Realized losses | $ | (11 | ) | $ | — | $ | (2 | ) | $ | (1 | ) | |||||
Proceeds from sales of securities | $ | 252 | $ | 25 | $ | 201 | $ | 401 | ||||||||
Investments in securities | $ | (272 | ) | $ | (30 | ) | $ | (215 | ) | $ | (418 | ) |
December 31, | |||||||
2017 | 2016 | ||||||
Wholesale Generation: | |||||||
Generation and mining | $ | 4,501 | $ | 3,997 | |||
Retail Electricity | 5 | 3 | |||||
Corporate and Other | 120 | 107 | |||||
Total | 4,626 | 4,107 | |||||
Less accumulated depreciation | (282 | ) | (54 | ) | |||
Net of accumulated depreciation | 4,344 | 4,053 | |||||
Nuclear fuel (net of accumulated amortization of $111 million and $31 million) | 158 | 166 | |||||
Construction work in progress: | |||||||
Wholesale Generation | 312 | 210 | |||||
Retail Electricity | — | 6 | |||||
Corporate and Other | 6 | 8 | |||||
Total construction work in progress | 318 | 224 | |||||
Property, plant and equipment — net | $ | 4,820 | $ | 4,443 |
Nuclear Plant Decommissioning | Mining Land Reclamation | Other | Total | ||||||||||||
Predecessor: | |||||||||||||||
Liability at December 31, 2015 | $ | 508 | $ | 215 | $ | 107 | $ | 830 | |||||||
Additions: | |||||||||||||||
Accretion — January 1, 2016 through October 2, 2016 | 22 | 16 | 5 | 43 | |||||||||||
Adjustment for new cost estimate | — | — | 1 | 1 | |||||||||||
Incremental reclamation costs | — | 14 | 12 | 26 | |||||||||||
Reductions: | |||||||||||||||
Payments — January 1, 2016 through October 2, 2016 | — | (37 | ) | (3 | ) | (40 | ) | ||||||||
Liability at October 2, 2016 | 530 | 208 | 122 | 860 | |||||||||||
Less amounts due currently | — | (50 | ) | (1 | ) | (51 | ) | ||||||||
Noncurrent liability at October 2, 2016 | $ | 530 | $ | 158 | $ | 121 | $ | 809 | |||||||
Successor: | |||||||||||||||
Fair value of liability established at October 3, 2016 | $ | 1,192 | $ | 374 | $ | 152 | $ | 1,718 | |||||||
Additions: | |||||||||||||||
Accretion — October 3, 2016 through December31, 2016 | 8 | 5 | 1 | 14 | |||||||||||
Reductions: | |||||||||||||||
Payments — October 3, 2016 through December31, 2016 | — | (4 | ) | (2 | ) | (6 | ) | ||||||||
Liability at December 31, 2016 | 1,200 | 375 | 151 | 1,726 | |||||||||||
Additions: | |||||||||||||||
Accretion | 33 | 18 | 8 | 59 | |||||||||||
Adjustment for change in estimates (a) | — | 81 | 44 | 125 | |||||||||||
Incremental reclamation costs (b) | — | — | 62 | 62 | |||||||||||
Reductions: | |||||||||||||||
Payments | — | (36 | ) | — | (36 | ) | |||||||||
Liability at December 31, 2017 | 1,233 | 438 | 265 | 1,936 | |||||||||||
Less amounts due currently | — | (93 | ) | (6 | ) | (99 | ) | ||||||||
Noncurrent liability at December 31, 2017 | $ | 1,233 | $ | 345 | $ | 259 | $ | 1,837 |
(a) | Amounts primarily relate to the impacts of accelerating the ARO associated with the retirements of the Sandow 4, Sandow 5, Big Brown and Monticello plants (see Note 4). |
(b) | Amounts primarily relate to liabilities incurred as part of acquiring certain real property through the Alcoa contract settlement (see Note 4). |
December 31, | |||||||
2017 | 2016 | ||||||
Unfavorable purchase and sales contracts | $ | 36 | $ | 46 | |||
Other, including retirement and other employee benefits | 220 | 174 | |||||
Total other noncurrent liabilities and deferred credits | $ | 256 | $ | 220 |
Year | Amount | |||
2018 | $ | 11 | ||
2019 | $ | 9 | ||
2020 | $ | 9 | ||
2021 | $ | 1 | ||
2022 | $ | 3 |
December 31, 2017 | December 31, 2016 | |||||||||||||||
Debt: | Carrying Amount | Fair Value | Carrying Amount | Fair Value | ||||||||||||
Long-term debt under the Vistra Operations Credit Facilities (Note 12) | $ | 4,323 | $ | 4,334 | $ | 4,515 | $ | 4,552 | ||||||||
Other long-term debt, excluding capital lease obligations (Note 12) | 30 | 27 | 36 | 32 | ||||||||||||
Mandatorily redeemable subsidiary preferred stock (Note 12) | 70 | 70 | 70 | 70 |
Successor | Predecessor | |||||||||||||||
Year Ended December 31, 2017 | Period from October 3, 2016 through December 31, 2016 | Period from January 1, 2016 through October 2, 2016 | Year Ended December 31, 2015 | |||||||||||||
Cash payments related to: | ||||||||||||||||
Interest paid (a) | $ | 245 | $ | 19 | $ | 1,064 | $ | 1,298 | ||||||||
Capitalized interest | (7 | ) | (3 | ) | (9 | ) | (11 | ) | ||||||||
Interest paid (net of capitalized interest) (a) | $ | 238 | $ | 16 | $ | 1,055 | $ | 1,287 | ||||||||
Income taxes | $ | 63 | $ | (2 | ) | $ | 22 | $ | 29 | |||||||
Reorganization items (b) | $ | — | $ | — | $ | 104 | $ | 224 | ||||||||
Noncash investing and financing activities: | ||||||||||||||||
Construction expenditures (c) | $ | 12 | $ | 1 | $ | 53 | $ | 75 |
(a) | Predecessor period includes amounts paid for adequate protection. |
(b) | Represents cash payments made by our Predecessor for legal and other consulting services, including amounts paid on behalf of third parties pursuant to contractual obligations approved by the Bankruptcy Court. |
(c) | Represents end-of-period accruals for ongoing construction projects. |
|
Successor | |||||||
Year Ended December 31, 2017 | Period from October 3, 2016 through December 31, 2016 | ||||||
Selling, general and administrative expense | $ | (47 | ) | $ | (7 | ) | |
Loss from operations | (47 | ) | (7 | ) | |||
Interest income | 4 | — | |||||
Impacts of Tax Receivable Agreement | 213 | (22 | ) | ||||
Income (loss) before income taxes and equity earnings | 170 | (29 | ) | ||||
Pretax equity in gains (losses) of consolidated subsidiaries | 80 | (204 | ) | ||||
Income tax (expense) benefit | (504 | ) | 70 | ||||
Net loss | $ | (254 | ) | $ | (163 | ) |
Successor | |||||||
Year Ended December 31, 2017 | Period from October 3, 2016 through December 31, 2016 | ||||||
Cash flows — operating activities: | |||||||
Net loss | $ | (254 | ) | $ | (163 | ) | |
Adjustments to reconcile net loss to cash provided by (used in) operating activities: | |||||||
Pretax equity in (gains) losses of consolidated subsidiaries | (80 | ) | 204 | ||||
Deferred income tax benefit (expense), net | 418 | (76 | ) | ||||
Impacts of Tax Receivables Agreement | (213 | ) | 22 | ||||
Other, net | 23 | 3 | |||||
Changes in operating assets and liabilities | (2 | ) | (26 | ) | |||
Cash used in operating activities | (108 | ) | (36 | ) | |||
Cash flows — financing activities: | |||||||
Special dividend (Note 4) | — | (992 | ) | ||||
Other, net | (1 | ) | 1 | ||||
Cash used in financing activities | (1 | ) | (991 | ) | |||
Cash flows — investing activities: | |||||||
Dividend received from subsidiaries | 1,505 | 997 | |||||
Odessa Acquisition | (330 | ) | — | ||||
Changes in restricted cash | 32 | 36 | |||||
Cash provided by financing activities | 1,207 | 1,033 | |||||
Net change in cash and cash equivalents | 1,098 | 6 | |||||
Cash and cash equivalents — beginning balance | 26 | 20 | |||||
Cash and cash equivalents — ending balance | $ | 1,124 | $ | 26 |
December 31 | |||||||
2017 | 2016 | ||||||
ASSETS | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 1,124 | $ | 26 | |||
Restricted cash | 59 | 90 | |||||
Other current assets | 5 | 3 | |||||
Total current assets | 1,188 | 119 | |||||
Equity investments in consolidated subsidiaries | 4,927 | 6,067 | |||||
Accumulated deferred income taxes | 710 | 1,122 | |||||
Other noncurrent assets | 6 | 7 | |||||
Total assets | $ | 6,831 | $ | 7,315 | |||
LIABILITIES AND EQUITY | |||||||
Current liabilities: | |||||||
Trade accounts payable | $ | 11 | $ | — | |||
Accrued taxes | 59 | 31 | |||||
Other current liabilities | 86 | 91 | |||||
Total current liabilities | 156 | 122 | |||||
Tax Receivable Agreement obligation | 333 | 596 | |||||
Total liabilities | 489 | 718 | |||||
Total shareholders' equity | 6,342 | 6,597 | |||||
Total liabilities and equity | $ | 6,831 | $ | 7,315 |
1. | BASIS OF PRESENTATION |
2. | RESTRICTIONS ON SUBSIDIARIES |
3. | GUARANTEES |
4. | DIVIDEND RESTRICTIONS |
|
|
Cash paid to seller at close | $ | 603 | ||
Net working capital adjustments | (4 | ) | ||
Consideration paid to seller | 599 | |||
Cash paid to repay project financing at close | 950 | |||
Total cash paid related to acquisition | $ | 1,549 | ||
Cash and cash equivalents | $ | 210 | ||
Property, plant and equipment — net | 1,316 | |||
Commodity and other derivative contractual assets | 47 | |||
Other assets | 44 | |||
Total assets acquired | 1,617 | |||
Commodity and other derivative contractual liabilities | 53 | |||
Trade accounts payable and other liabilities | 15 | |||
Total liabilities assumed | 68 | |||
Identifiable net assets acquired | $ | 1,549 |
Cash paid to seller at close | $ | 603 | ||
Net working capital adjustments | (4 | ) | ||
Consideration paid to seller | 599 | |||
Cash paid to repay project financing at close | 950 | |||
Total cash paid related to acquisition | $ | 1,549 | ||
Cash and cash equivalents | $ | 210 | ||
Property, plant and equipment — net | 1,316 | |||
Commodity and other derivative contractual assets | 47 | |||
Other assets | 44 | |||
Total assets acquired | 1,617 | |||
Commodity and other derivative contractual liabilities | 53 | |||
Trade accounts payable and other liabilities | 15 | |||
Total liabilities assumed | 68 | |||
Identifiable net assets acquired | $ | 1,549 |
Predecessor | |||||||
Period from January 1, 2016 through October 2, 2016 | Year Ended December 31, 2015 | ||||||
Revenues | $ | 4,116 | $ | 6,133 | |||
Net income (loss) | $ | 22,835 | $ | (4,671 | ) |
|
Name | Location (all in the state of Texas) | Fuel Type | Installed Nameplate Generation Capacity (MW) | Number of Units | Date Units Taken Offline | ||||||
Monticello | Titus County | Lignite/Coal | 1,880 | 3 | January 4, 2018 | ||||||
Sandow | Milam County | Lignite | 1,137 | 2 | January 11, 2018 | ||||||
Big Brown | Freestone County | Lignite/Coal | 1,150 | 2 | February 12, 2018 | ||||||
Total | 4,167 | 7 |
|
Predecessor | |||||||
Period from January 1, 2016 through October 2, 2016 | Year Ended December 31, 2015 | ||||||
Gain on reorganization adjustments (Note 6) | $ | (24,252 | ) | $ | — | ||
Loss from the adoption of fresh start reporting | 2,013 | — | |||||
Expenses related to legal advisory and representation services | 55 | 141 | |||||
Expenses related to other professional consulting and advisory services | 39 | 69 | |||||
Contract claims adjustments | 13 | 54 | |||||
Noncash adjustment for estimated allowed claims related to debt | — | 896 | |||||
Adjustment to affiliate claims pursuant to Settlement Agreement (Note 19) | — | (635 | ) | ||||
Gain on settlement of debt held by affiliates (Note 19) | — | (382 | ) | ||||
Gain on settlement of interest on debt held by affiliates | — | (20 | ) | ||||
Sponsor management agreement settlement | — | (19 | ) | ||||
Contract assumption adjustments | — | (14 | ) | ||||
Fees associated with extension/completion of the DIP Facility | — | 9 | |||||
Other | 11 | 2 | |||||
Total reorganization items | $ | (22,121 | ) | $ | 101 |
|
Business enterprise value | $ | 10,500 | |
Cash excluded from business enterprise value | 1,594 | ||
Deferred asset related to prepaid capital lease obligation | 38 | ||
Current liabilities, excluding short-term portion of debt and capital leases | 1,123 | ||
Noncurrent, non-interest bearing liabilities | 1,906 | ||
Vistra Energy reorganization value of assets | $ | 15,161 |
October 3, 2016 | |||||||||||||||||||
TCEH (Predecessor) (1) | Reorganization Adjustments (2) | Fresh Start Adjustments | Vistra Energy (Successor) | ||||||||||||||||
ASSETS | |||||||||||||||||||
Current assets: | |||||||||||||||||||
Cash and cash equivalents | $ | 1,829 | $ | (1,028 | ) | (3) | $ | — | $ | 801 | |||||||||
Restricted cash | 12 | 131 | (4) | — | 143 | ||||||||||||||
Trade accounts receivable — net | 750 | 4 | — | 754 | |||||||||||||||
Advances to parents and affiliates of Predecessor | 78 | (78 | ) | — | — | ||||||||||||||
Inventories | 374 | — | (86 | ) | (17) | 288 | |||||||||||||
Commodity and other derivative contractual assets | 255 | — | — | 255 | |||||||||||||||
Margin deposits related to commodity contracts | 42 | — | — | 42 | |||||||||||||||
Other current assets | 47 | 17 | 3 | 67 | |||||||||||||||
Total current assets | 3,387 | (954 | ) | (83 | ) | 2,350 | |||||||||||||
Restricted cash | 650 | — | — | 650 | |||||||||||||||
Advance to parent and affiliates of Predecessor | 17 | (21 | ) | 4 | — | ||||||||||||||
Investments | 1,038 | 1 | 9 | (18) | 1,048 | ||||||||||||||
Property, plant and equipment — net | 10,359 | 53 | (5,970 | ) | (19) | 4,442 | |||||||||||||
Goodwill | 152 | — | 1,755 | (27) | 1,907 | ||||||||||||||
Identifiable intangible assets — net | 1,148 | 4 | 2,256 | (20) | 3,408 | ||||||||||||||
Commodity and other derivative contractual assets | 73 | — | (14 | ) | 59 | ||||||||||||||
Deferred income taxes | — | 320 | (5) | 730 | (21) | 1,050 | |||||||||||||
Other noncurrent assets | 51 | 38 | 158 | (22) | 247 | ||||||||||||||
Total assets | $ | 16,875 | $ | (559 | ) | $ | (1,155 | ) | $ | 15,161 | |||||||||
LIABILITIES AND EQUITY | |||||||||||||||||||
Current liabilities: | |||||||||||||||||||
Long-term debt due currently | $ | 4 | $ | 5 | $ | (1 | ) | $ | 8 | ||||||||||
Trade accounts payable | 402 | 145 | (6) | 3 | 550 | ||||||||||||||
Trade accounts and other payables to affiliates of Predecessor | 152 | (152 | ) | (6) | — | — | |||||||||||||
Commodity and other derivative contractual liabilities | 125 | — | — | 125 | |||||||||||||||
Margin deposits related to commodity contracts | 64 | — | — | 64 | |||||||||||||||
Accrued income taxes | 12 | 12 | — | 24 | |||||||||||||||
Accrued taxes other than income | 119 | 4 | — | 123 | |||||||||||||||
Accrued interest | 110 | (109 | ) | (7) | — | 1 | |||||||||||||
Other current liabilities | 243 | 170 | (8) | 5 | 418 | ||||||||||||||
Total current liabilities | 1,231 | 75 | 7 | 1,313 |
October 3, 2016 | |||||||||||||||||||
TCEH (Predecessor) (1) | Reorganization Adjustments (2) | Fresh Start Adjustments | Vistra Energy (Successor) | ||||||||||||||||
Long-term debt, less amounts due currently | — | 3,476 | (9) | 151 | (23) | 3,627 | |||||||||||||
Borrowings under debtor-in-possession credit facilities | 3,387 | (3,387 | ) | (9) | — | — | |||||||||||||
Liabilities subject to compromise | 33,749 | (33,749 | ) | (10) | — | — | |||||||||||||
Commodity and other derivative contractual liabilities | 5 | — | 3 | 8 | |||||||||||||||
Deferred income taxes | 256 | (256 | ) | (11) | — | — | |||||||||||||
Tax Receivable Agreement obligation | — | 574 | (12) | — | 574 | ||||||||||||||
Asset retirement obligations | 809 | — | 854 | (24) | 1,663 | ||||||||||||||
Other noncurrent liabilities and deferred credits | 1,018 | 117 | (13) | (900 | ) | (25) | 235 | ||||||||||||
Total liabilities | 40,455 | (33,150 | ) | 115 | 7,420 | ||||||||||||||
Equity: | |||||||||||||||||||
Common stock | — | 4 | (14) | — | 4 | ||||||||||||||
Additional paid-in-capital | — | 7,737 | (15) | — | 7,737 | ||||||||||||||
Accumulated other comprehensive income (loss) | (32 | ) | 22 | 10 | (26) | — | |||||||||||||
Predecessor membership interests | (23,548 | ) | 24,828 | (16) | (1,280 | ) | (26) | — | |||||||||||
Total equity | (23,580 | ) | 32,591 | (1,270 | ) | 7,741 | |||||||||||||
Total liabilities and equity | $ | 16,875 | $ | (559 | ) | $ | (1,155 | ) | $ | 15,161 |
(1) | Represents the consolidated balance sheet of TCEH as of October 3, 2016. |
Sources (uses): | |||
Net proceeds from PrefCo preferred stock sale | $ | 69 | |
Addition of cash balances from the Contributed EFH Debtors | 22 | ||
Payments to TCEH first lien creditors, including adequate protection | (486 | ) | |
Payment to TCEH unsecured creditors (including $73 million to escrow) | (502 | ) | |
Payment of administrative claims to TCEH creditors | (53 | ) | |
Payment of legal fees, professional fees and other costs (including $52 million to escrow) | (78 | ) | |
Net use of cash | $ | (1,028 | ) |
Notes, loans and other debt | $ | 31,668 | |
Accrued interest on notes, loans and other debt | 646 | ||
Net liability under terminated TCEH interest rate swap and natural gas hedging agreements | 1,243 | ||
Trade accounts payable and other expected allowed claims | 192 | ||
Third-party liabilities subject to compromise | 33,749 | ||
LSTC from the Contributed EFH Entities | 8 | ||
Total liabilities subject to compromise | 33,757 | ||
Fair value of equity issued to TCEH first lien creditors | (7,741 | ) | |
TRA Rights issued to TCEH first lien creditors | (574 | ) | |
Cash distributed and accruals for TCEH first lien creditors | (377 | ) | |
Cash distributed for TCEH unsecured claims | (502 | ) | |
Cash distributed and accruals for TCEH administrative claims | (60 | ) | |
Settlement of affiliate balances | (99 | ) | |
Net liabilities of contributed entities and other items | (60 | ) | |
Gain on extinguishment of LSTC | $ | 24,344 |
Enterprise value | $ | 10,500 | |
Vistra Operations Credit Facility – Initial Term Loan B Facility | (2,871 | ) | |
Vistra Operations Credit Facility – Term Loan C Facility | (655 | ) | |
Accrual for post-Emergence claims satisfaction | (181 | ) | |
Tax Receivable Agreement obligation | (574 | ) | |
Preferred stock of PrefCo | (70 | ) | |
Other items | (2 | ) | |
Cash and cash equivalents | 801 | ||
Restricted cash | 793 | ||
Equity value at Emergence | $ | 7,741 | |
Common stock at par value | $ | 4 | |
Additional paid-in capital | 7,737 | ||
Equity value | $ | 7,741 | |
Shares outstanding at October 3, 2016 (in millions) | 427.5 | ||
Per share value | $ | 18.11 |
Gain on extinguishment of LSTC | $ | 24,344 | |
Elimination of accumulated other comprehensive income | (22 | ) | |
Change in control payments | (23 | ) | |
Professional fees | (33 | ) | |
Other items | (14 | ) | |
Pretax gain on reorganization adjustments (Note 5) | 24,252 | ||
Deferred tax impact of the Plan of Reorganization and Spin-off | 576 | ||
Total impact to membership interests | $ | 24,828 |
Property, Plant and Equipment | Adjustment | Fair Value | ||||
Generation plants and mining assets | $ | (6,057 | ) | $ | 3,698 | |
Land | 140 | 490 | ||||
Nuclear Fuel | (23 | ) | 157 | |||
Other equipment | (30 | ) | 97 | |||
Total | $ | (5,970 | ) | $ | 4,442 |
Business enterprise value | $ | 10,500 | |
Add: Fair value of liabilities excluded from enterprise value | 3,030 | ||
Less: Fair value of tangible assets | (8,215 | ) | |
Less: Fair value of identified intangible assets | (3,408 | ) | |
Vistra Energy goodwill | $ | 1,907 |
|
December 31, 2017 | December 31, 2016 | |||||||||||||||||||||||
Identifiable Intangible Asset | Gross Carrying Amount | Accumulated Amortization | Net | Gross Carrying Amount | Accumulated Amortization | Net | ||||||||||||||||||
Retail customer relationship | $ | 1,648 | $ | 572 | $ | 1,076 | $ | 1,648 | $ | 152 | $ | 1,496 | ||||||||||||
Software and other technology-related assets | 183 | 47 | 136 | 147 | 9 | 138 | ||||||||||||||||||
Electricity supply contract (a) | — | — | — | 190 | 2 | 188 | ||||||||||||||||||
Retail and wholesale contracts | 154 | 87 | 67 | 164 | 38 | 126 | ||||||||||||||||||
Other identifiable intangible assets (b) | 33 | 11 | 22 | 30 | 2 | 28 | ||||||||||||||||||
Total identifiable intangible assets subject to amortization | $ | 2,018 | $ | 717 | 1,301 | $ | 2,179 | $ | 203 | 1,976 | ||||||||||||||
Retail trade names (not subject to amortization) | 1,225 | 1,225 | ||||||||||||||||||||||
Mineral interests (not currently subject to amortization) | 4 | 4 | ||||||||||||||||||||||
Total identifiable intangible assets | $ | 2,530 | $ | 3,205 |
(a) | Contract terminated in October 2017. See Note 4. |
(b) | Includes mining development costs and environmental allowances and credits. |
Successor | Predecessor | ||||||||||||||||||||
Identifiable Intangible Asset | Statements of Consolidated Income (Loss) Line | Remaining useful lives at December 31, 2017 (weighted average in years) | Year Ended December 31, 2017 | Period from October 3, 2016 through December 31, 2016 | Period from January 1, 2016 through October 2, 2016 | Year Ended December 31, 2015 | |||||||||||||||
Retail customer relationship | Depreciation and amortization | 4 | $ | 420 | $ | 152 | $ | 9 | $ | 17 | |||||||||||
Software and other technology-related assets | Depreciation and amortization | 3 | 38 | 9 | 44 | 60 | |||||||||||||||
Electricity supply contract | Operating revenues | 0 | 6 | 2 | — | — | |||||||||||||||
Retail and wholesale contracts | Operating revenues/fuel, purchased power costs and delivery fees | 3 | 59 | 38 | — | — | |||||||||||||||
Other identifiable intangible assets | Operating revenues/fuel, purchased power costs and delivery fees/depreciation and amortization | 4 | 9 | 2 | 6 | 30 | |||||||||||||||
Total amortization expense (a) | $ | 532 | $ | 203 | $ | 59 | $ | 107 |
(a) | Amounts recorded in depreciation and amortization totaled $463 million, $162 million, $58 million and $85 million for the Successor period for the year ended December 31, 2017 and the period from October 3, 2016 through December 31, 2016 and the Predecessor period from January 1, 2016 through October 2, 2016 and the year ended December 31, 2015, respectively. |
Year | Estimated Amortization Expense | |||
2018 | $ | 367 | ||
2019 | $ | 268 | ||
2020 | $ | 191 | ||
2021 | $ | 142 | ||
2022 | $ | 4 |
Year | Estimated Amortization Expense | |||
2018 | $ | 367 | ||
2019 | $ | 268 | ||
2020 | $ | 191 | ||
2021 | $ | 142 | ||
2022 | $ | 4 |
|
Successor | Predecessor | |||||||||||||||
Year Ended December 31, 2017 | Period from October 3, 2016 through December 31, 2016 | Period from January 1, 2016 through October 2, 2016 | Year Ended December 31, 2015 | |||||||||||||
Current: | ||||||||||||||||
U.S. Federal | $ | 72 | $ | — | $ | (6 | ) | $ | (17 | ) | ||||||
State | 14 | 6 | 9 | 21 | ||||||||||||
Total current | 86 | 6 | 3 | 4 | ||||||||||||
Deferred: | ||||||||||||||||
U.S. Federal | 417 | (75 | ) | (1,234 | ) | (811 | ) | |||||||||
State | 1 | (1 | ) | (36 | ) | (72 | ) | |||||||||
Total deferred | 418 | (76 | ) | (1,270 | ) | (883 | ) | |||||||||
Total | $ | 504 | $ | (70 | ) | $ | (1,267 | ) | $ | (879 | ) |
Successor | Predecessor | |||||||||||||||
Year Ended December 31, 2017 | Period from October 3, 2016 through December 31, 2016 | Period from January 1, 2016 through October 2, 2016 | Year Ended December 31, 2015 | |||||||||||||
Income (loss) before income taxes | $ | 250 | $ | (233 | ) | $ | 21,584 | $ | (5,556 | ) | ||||||
Income taxes at the U.S. federal statutory rate of 35% | 88 | (82 | ) | 7,554 | (1,945 | ) | ||||||||||
Nondeductible TRA accretion | (80 | ) | 5 | — | — | |||||||||||
Texas margin tax, net of federal benefit | 13 | 3 | (21 | ) | — | |||||||||||
Impacts of tax reform legislation on deferred taxes | 451 | — | — | — | ||||||||||||
Effects of Tax Matters Agreement and tax-free spin-off transaction | 19 | — | — | — | ||||||||||||
Nondeductible debt restructuring costs | — | 2 | 38 | 64 | ||||||||||||
Nondeductible interest expense | — | — | 12 | 21 | ||||||||||||
Nontaxable gain on extinguishment of LSTC | — | — | (8,593 | ) | — | |||||||||||
Valuation allowance | — | — | (210 | ) | 210 | |||||||||||
Nondeductible goodwill impairment | — | — | — | 770 | ||||||||||||
Lignite depletion allowance | — | — | — | (8 | ) | |||||||||||
Interest accrued for uncertain tax positions, net of tax | — | — | — | (2 | ) | |||||||||||
Other | 13 | 2 | (47 | ) | 11 | |||||||||||
Income tax expense (benefit) | $ | 504 | $ | (70 | ) | $ | (1,267 | ) | $ | (879 | ) | |||||
Effective tax rate | 201.6 | % | 30.0 | % | (5.9 | )% | 15.8 | % |
December 31, | |||||||
2017 | 2016 | ||||||
Noncurrent Deferred Income Tax Assets | |||||||
Net operating loss (NOL) carryforwards | $ | — | $ | 8 | |||
Property, plant and equipment | 520 | 943 | |||||
Intangible assets | 81 | 29 | |||||
Long-term debt | 20 | 52 | |||||
Employee benefit obligations | 56 | 84 | |||||
Commodity contracts and interest rate swaps | 25 | — | |||||
Other | 8 | 6 | |||||
Total deferred tax assets | $ | 710 | $ | 1,122 |
Predecessor | |||||||
Period from January 1, 2016 through October 2, 2016 | Year Ended December 31, 2015 | ||||||
Balance at beginning of period, excluding interest and penalties | $ | 36 | $ | 65 | |||
Reductions based on tax positions related to prior years | (1 | ) | (11 | ) | |||
Settlements with taxing authorities | (35 | ) | (18 | ) | |||
Balance at end of period, excluding interest and penalties | $ | — | $ | 36 |
|
Successor | |||||||
Year Ended December 31, 2017 | Period from October 3, 2016 through December 31, 2016 | ||||||
TRA obligation at the beginning of the period | $ | 596 | $ | 574 | |||
Accretion expense | 82 | 22 | |||||
Payments | (26 | ) | — | ||||
Revaluation due to tax reform legislation | (233 | ) | — | ||||
Changes in tax assumptions impacting timing of payments | (62 | ) | — | ||||
TRA obligation at the end of the period | 357 | 596 | |||||
Less amounts due currently | (24 | ) | — | ||||
Noncurrent TRA obligation at the end of the period | $ | 333 | $ | 596 |
|
Successor | Predecessor | |||||||||||||||
Year Ended December 31, 2017 | Period from October 3, 2016 through December 31, 2016 | Period from January 1, 2016 through October 2, 2016 | Year Ended December 31, 2015 | |||||||||||||
Interest paid/accrued post-Emergence | $ | 213 | $ | 51 | $ | — | $ | — | ||||||||
Interest paid/accrued on debtor-in-possession financing | — | — | 76 | 63 | ||||||||||||
Adequate protection amounts paid/accrued | — | — | 977 | 1,233 | ||||||||||||
Unrealized mark-to-market net (gains) losses on interest rate swaps | (29 | ) | 11 | — | — | |||||||||||
Capitalized interest | (7 | ) | (3 | ) | (9 | ) | (11 | ) | ||||||||
Other | 16 | 1 | 5 | 4 | ||||||||||||
Total interest expense and related charges | $ | 193 | $ | 60 | $ | 1,049 | $ | 1,289 |
Predecessor | |||||||
Period from January 1, 2016 through October 2, 2016 | Year Ended December 31, 2015 | ||||||
Contractual interest on debt classified as LSTC | $ | 1,570 | $ | 2,070 | |||
Adequate protection amounts paid/accrued | 930 | 1,173 | |||||
Contractual interest on debt classified as LSTC not paid/accrued | $ | 640 | $ | 897 |
|
December 31, 2017 | December 31, 2016 | ||||||
Vistra Operations Credit Facilities (a) | $ | 4,323 | $ | 4,515 | |||
Mandatorily redeemable subsidiary preferred stock (b) | 70 | 70 | |||||
8.82% Building Financing due semiannually through February 11, 2022 (c) | 30 | 36 | |||||
Capital lease obligations | — | 2 | |||||
Total long-term debt including amounts due currently | 4,423 | 4,623 | |||||
Less amounts due currently | (44 | ) | (46 | ) | |||
Total long-term debt less amounts due currently | $ | 4,379 | $ | 4,577 |
(a) | At December 31, 2017, borrowings under the Vistra Operations Credit Facilities in our consolidated balance sheet include debt premiums of $21 million, debt discounts of $2 million and debt issuance costs of $7 million. At December 31, 2016, borrowings under the Vistra Operations Credit Facilities in our consolidated balance sheet include debt premiums of $25 million, debt discounts of $2 million and debt issuance costs of $8 million. |
(b) | Shares of mandatorily redeemable preferred stock in PrefCo issued as part of the spin-off of Vistra Energy from EFH Corp. (see Note 5). This subsidiary preferred stock is accounted for as a debt instrument under relevant accounting guidance. |
(c) | Obligation related to a corporate office space capital lease transferred to Vistra Energy pursuant to the Plan of Reorganization. This obligation will be funded by amounts held in an escrow account that is reflected in other noncurrent assets in our consolidated balance sheets. |
December 31, 2017 | ||||||||||||||
Vistra Operations Credit Facilities | Maturity Date | Facility Limit | Cash Borrowings | Available Capacity | ||||||||||
Revolving Credit Facility (a) | August 4, 2021 | $ | 860 | $ | — | $ | 834 | |||||||
Initial Term Loan B Facility (b)(c) | August 4, 2023 | 2,850 | 2,821 | — | ||||||||||
Incremental Term Loan B Facility (c) | December 14, 2023 | 1,000 | 990 | — | ||||||||||
Term Loan C Facility (d) | August 4, 2023 | 650 | 500 | 7 | ||||||||||
Total Vistra Operations Credit Facilities | $ | 5,360 | $ | 4,311 | $ | 841 |
(a) | Facility to be used for general corporate purposes. Facility includes a $715 million letter of credit sub-facility, of which $26 million of letters of credit were outstanding at December 31, 2017. |
(b) | Facility used to repay all amounts outstanding under our Predecessor's DIP Facility and issuance costs for the DIP Roll Facilities, with the remaining balance used for general corporate purposes. |
(c) | Cash borrowings under the Term Loan B Facility reflect required scheduled quarterly payment in annual amount equal to 1% of the original principal amount with the balance paid at maturity. Amounts paid cannot be reborrowed. |
(d) | Facility used for issuing letters of credit for general corporate purposes. Borrowings under this facility were funded to collateral accounts that are reported as restricted cash in our consolidated balance sheets. Cash borrowings reflect a $150 million principal reduction paid from restricted cash in December 2017. Amounts paid cannot be reborrowed. At December 31, 2017, the restricted cash supported $493 million in letters of credit outstanding (see Note 21), leaving $7 million in available letter of credit capacity. |
December 31, 2017 | |||
2018 | $ | 44 | |
2019 | 44 | ||
2020 | 44 | ||
2021 | 45 | ||
2022 | 42 | ||
Thereafter | 4,189 | ||
Unamortized premiums, discounts and debt issuance costs | 15 | ||
Total long-term debt, including amounts due currently | $ | 4,423 |
|
Coal purchase and transportation agreements | Pipeline transportation and storage reservation fees | Nuclear Fuel Contracts | Other Contracts | ||||||||||||
2018 | $ | 12 | $ | 39 | $ | 120 | $ | 158 | |||||||
2019 | — | 28 | 48 | 46 | |||||||||||
2020 | — | 28 | 47 | 55 | |||||||||||
2021 | — | 29 | 55 | 36 | |||||||||||
2022 | — | 29 | 32 | 89 | |||||||||||
Thereafter | — | 141 | 193 | 194 | |||||||||||
Total | $ | 12 | $ | 294 | $ | 495 | $ | 578 |
Operating Leases (a) | |||
2018 | $ | 17 | |
2019 | 15 | ||
2020 | 12 | ||
2021 | 10 | ||
2022 | 8 | ||
Thereafter | 150 | ||
Total future minimum lease payments | $ | 212 |
(a) | Includes operating leases with initial or remaining noncancellable lease terms in excess of one year. |
|
Successor | |||||
Year Ended December 31, 2017 | Period from October 3, 2016 through December 31, 2016 | ||||
Shares outstanding at beginning of period | 427,580,232 | — | |||
Shares issued (a) | 818,570 | 427,580,232 | |||
Shares repurchased | — | — | |||
Shares outstanding at end of period | 428,398,802 | 427,580,232 |
(a) | Includes share awards granted to directors and other nonemployees. |
|
December 31, 2017 | |||||||||||||||||||
Level 1 | Level 2 | Level 3 (a) | Reclassification (b) | Total | |||||||||||||||
Assets: | |||||||||||||||||||
Commodity contracts | $ | 47 | $ | 98 | $ | 75 | $ | 2 | $ | 222 | |||||||||
Interest rate swaps | — | 18 | — | 8 | 26 | ||||||||||||||
Nuclear decommissioning trust – equity securities (c) | 468 | — | — | — | 468 | ||||||||||||||
Nuclear decommissioning trust – debt securities (c) | — | 430 | — | — | 430 | ||||||||||||||
Sub-total | $ | 515 | $ | 546 | $ | 75 | $ | 10 | 1,146 | ||||||||||
Assets measured at net asset value (d): | |||||||||||||||||||
Nuclear decommissioning trust – equity securities (c) | 290 | ||||||||||||||||||
Total assets | $ | 1,436 | |||||||||||||||||
Liabilities: | |||||||||||||||||||
Commodity contracts | $ | 45 | $ | 143 | $ | 128 | $ | 2 | $ | 318 | |||||||||
Interest rate swaps | — | — | — | 8 | 8 | ||||||||||||||
Total liabilities | $ | 45 | $ | 143 | $ | 128 | $ | 10 | $ | 326 |
December 31, 2016 | |||||||||||||||||||
Level 1 | Level 2 | Level 3 (a) | Reclassification (b) | Total | |||||||||||||||
Assets: | |||||||||||||||||||
Commodity contracts | $ | 167 | $ | 131 | $ | 98 | $ | — | $ | 396 | |||||||||
Interest rate swaps | — | 5 | — | 13 | 18 | ||||||||||||||
Nuclear decommissioning trust – equity securities (c) | 425 | — | — | — | 425 | ||||||||||||||
Nuclear decommissioning trust – debt securities (c) | — | 340 | — | — | 340 | ||||||||||||||
Sub-total | $ | 592 | $ | 476 | $ | 98 | $ | 13 | 1,179 | ||||||||||
Assets measured at net asset value (d): | |||||||||||||||||||
Nuclear decommissioning trust – equity securities (c) | 247 | ||||||||||||||||||
Total assets | $ | 1,426 | |||||||||||||||||
Liabilities: | |||||||||||||||||||
Commodity contracts | $ | 302 | $ | 15 | $ | 15 | $ | — | $ | 332 | |||||||||
Interest rate swaps | — | 16 | — | 13 | 29 | ||||||||||||||
Total liabilities | $ | 302 | $ | 31 | $ | 15 | $ | 13 | $ | 361 |
(a) | See table below for description of Level 3 assets and liabilities. |
(b) | Fair values are determined on a contract basis, but certain contracts result in a current asset and a noncurrent liability, or vice versa, as presented in our consolidated balance sheets. |
(c) | The nuclear decommissioning trust investment is included in the other investments line in our consolidated balance sheets. See Note 21. |
(d) | The fair value amounts presented in this line are intended to permit reconciliation of the fair value hierarchy to the amounts presented in our consolidated balance sheets. Certain investments measured at fair value using the net asset value per share (or its equivalent) have not been classified in the fair value hierarchy. |
December 31, 2017 | ||||||||||||||||||
Fair Value | ||||||||||||||||||
Contract Type (a) | Assets | Liabilities | Total | Valuation Technique | Significant Unobservable Input | Range (b) | ||||||||||||
Electricity purchases and sales | $ | 12 | $ | (33 | ) | $ | (21 | ) | Valuation Model | Hourly price curve shape (c) | $0 to $40/ MWh | |||||||
Illiquid delivery periods for ERCOT hub power prices and heat rates (d) | $20 to $70/ MWh | |||||||||||||||||
Electricity options | — | (91 | ) | (91 | ) | Option Pricing Model | Gas to power correlation (e) | 30% to 100% | ||||||||||
Power volatility (e) | 5% to 180% | |||||||||||||||||
Electricity congestion revenue rights | 45 | (4 | ) | 41 | Market Approach (f) | Illiquid price differences between settlement points (g) | $0 to $15/ MWh | |||||||||||
Other (h) | 18 | — | 18 | |||||||||||||||
Total | $ | 75 | $ | (128 | ) | $ | (53 | ) |
December 31, 2016 | ||||||||||||||||||
Fair Value | ||||||||||||||||||
Contract Type (a) | Assets | Liabilities | Total | Valuation Technique | Significant Unobservable Input | Range (b) | ||||||||||||
Electricity purchases and sales | $ | 32 | $ | — | $ | 32 | Valuation Model | Hourly price curve shape (c) | $0 to $35/ MWh | |||||||||
Illiquid delivery periods for ERCOT hub power prices and heat rates (d) | $30 to $70/ MWh | |||||||||||||||||
Electricity congestion revenue rights | 42 | (6 | ) | 36 | Market Approach (f) | Illiquid price differences between settlement points (g) | $0 to $10/ MWh | |||||||||||
Other (h) | 24 | (9 | ) | 15 | ||||||||||||||
Total | $ | 98 | $ | (15 | ) | $ | 83 |
(a) | Electricity purchase and sales contracts include power and heat rate positions in ERCOT regions. Electricity congestion revenue rights contracts consist of forward purchase contracts (swaps and options) used to hedge electricity price differences between settlement points within ERCOT. Electricity options consist of physical electricity options and spread options. |
(b) | The range of the inputs may be influenced by factors such as time of day, delivery period, season and location. |
(c) | Based on the historical range of forward average hourly ERCOT North Hub prices. |
(d) | Based on historical forward ERCOT power price and heat rate variability. |
(e) | Based on historical forward correlation and volatility within ERCOT. |
(f) | While we use the market approach, there is insufficient market data to consider the valuation liquid. |
(g) | Based on the historical price differences between settlement points within ERCOT hubs and load zones. |
(h) | Other includes contracts for natural gas, weather options and coal options. December 31, 2016 also includes an immaterial amount of electricity options. |
Successor | Predecessor | |||||||||||||||
Year Ended December 31, 2017 | Period from October 3, 2016 through December 31, 2016 | Period from January 1, 2016 through October 2, 2016 | Year Ended December 31, 2015 | |||||||||||||
Net asset balance at beginning of period (a) | $ | 83 | $ | 81 | $ | 37 | $ | 35 | ||||||||
Total unrealized valuation gains (losses) | (136 | ) | 31 | 122 | 27 | |||||||||||
Purchases, issuances and settlements (b): | ||||||||||||||||
Purchases | 69 | 15 | 37 | 49 | ||||||||||||
Issuances | (22 | ) | (7 | ) | (20 | ) | (13 | ) | ||||||||
Settlements | (106 | ) | (30 | ) | (51 | ) | (48 | ) | ||||||||
Transfers into Level 3 (c) | 4 | 3 | 1 | 1 | ||||||||||||
Transfers out of Level 3 (c) | 71 | (10 | ) | 1 | (14 | ) | ||||||||||
Earn-out provision (d) | (16 | ) | — | — | — | |||||||||||
Net liabilities assumed in the Lamar and Forney Acquisition (Note 3) (e) | — | — | (30 | ) | — | |||||||||||
Net change (f) | (136 | ) | 2 | 60 | 2 | |||||||||||
Net asset (liability) balance at end of period | $ | (53 | ) | $ | 83 | $ | 97 | $ | 37 | |||||||
Unrealized valuation gains (losses) relating to instruments held at end of period | $ | (98 | ) | $ | 28 | $ | 98 | $ | 18 |
(a) | The beginning balance for the Successor period from October 3, 2016 through December 31, 2016 reflects a $16 million adjustment to the fair value of certain Level 3 assets driven by power prices utilized by the Successor for unobservable delivery periods. |
(b) | Settlements reflect reversals of unrealized mark-to-market valuations previously recognized in net income. Purchases and issuances reflect option premiums paid or received. |
(c) | Includes transfers due to changes in the observability of significant inputs. All Level 3 transfers during the periods presented are in and out of Level 2. For the year ended December 31, 2017, transfers out of Level 3 primarily consists of electricity derivatives where forward pricing inputs have become observable. |
(d) | Represents initial fair value of the earn-out provision incurred as part of the Odessa Acquisition. See Note 3. |
(e) | Includes fair value of Level 3 assets and liabilities as of the purchase date and any related rolloff between the purchase date and the period ended October 2, 2016. |
(f) | Activity excludes change in fair value in the month positions settle. For the Successor period, substantially all changes in values of commodity contracts (excluding the initial fair value of the earn-out provision related to the Odessa Acquisition in 2017) are reported as operating revenues in our statements of consolidated income (loss). For the Predecessor period, substantially all changes in values of commodity contracts (excluding net liabilities assumed in the Lamar and Forney Acquisition in 2016) are reported as net gain from commodity hedging and trading activities in the statements of consolidated income (loss). |
|
December 31, 2017 | |||||||||||||||||||
Derivative Assets | Derivative Liabilities | ||||||||||||||||||
Commodity Contracts | Interest Rate Swaps | Commodity Contracts | Interest Rate Swaps | Total | |||||||||||||||
Current assets | $ | 190 | $ | — | $ | — | $ | — | $ | 190 | |||||||||
Noncurrent assets | 30 | 22 | 2 | 4 | 58 | ||||||||||||||
Current liabilities | — | (4 | ) | (216 | ) | (4 | ) | (224 | ) | ||||||||||
Noncurrent liabilities | — | — | (102 | ) | — | (102 | ) | ||||||||||||
Net assets (liabilities) | $ | 220 | $ | 18 | $ | (316 | ) | $ | — | $ | (78 | ) |
December 31, 2016 | |||||||||||||||||||
Derivative Assets | Derivative Liabilities | ||||||||||||||||||
Commodity Contracts | Interest Rate Swaps | Commodity Contracts | Interest Rate Swaps | Total | |||||||||||||||
Current assets | $ | 350 | $ | — | $ | — | $ | — | $ | 350 | |||||||||
Noncurrent assets | 46 | 17 | — | 1 | 64 | ||||||||||||||
Current liabilities | — | (12 | ) | (330 | ) | (17 | ) | (359 | ) | ||||||||||
Noncurrent liabilities | — | — | (2 | ) | — | (2 | ) | ||||||||||||
Net assets (liabilities) | $ | 396 | $ | 5 | $ | (332 | ) | $ | (16 | ) | $ | 53 |
Successor | Predecessor | |||||||||||||||
Derivative (statements of consolidated income (loss) presentation) | Year Ended December 31, 2017 | Period from October 3, 2016 through December 31, 2016 | Period from January 1, 2016 through October 2, 2016 | Year Ended December 31, 2015 | ||||||||||||
Commodity contracts (Operating revenues) | $ | 56 | $ | (92 | ) | $ | — | $ | — | |||||||
Commodity contracts (Fuel, purchased power costs and delivery fees) | 6 | 21 | — | — | ||||||||||||
Commodity contracts (Net gain from commodity hedging and trading activities) | — | — | 194 | 380 | ||||||||||||
Interest rate swaps (Interest expense and related charges) | 2 | (11 | ) | — | — | |||||||||||
Net gain (loss) | $ | 64 | $ | (82 | ) | $ | 194 | $ | 380 |
December 31, 2017 | December 31, 2016 | |||||||||||||||||||||||||||||||
Derivative Assets and Liabilities | Offsetting Instruments (a) | Cash Collateral (Received) Pledged (b) | Net Amounts | Derivative Assets and Liabilities | Offsetting Instruments (a) | Cash Collateral (Received) Pledged (b) | Net Amounts | |||||||||||||||||||||||||
Derivative assets: | ||||||||||||||||||||||||||||||||
Commodity contracts | $ | 220 | $ | (113 | ) | $ | (1 | ) | $ | 106 | $ | 396 | $ | (193 | ) | $ | (20 | ) | $ | 183 | ||||||||||||
Interest rate swaps | 18 | — | — | 18 | 5 | — | — | 5 | ||||||||||||||||||||||||
Total derivative assets | 238 | (113 | ) | (1 | ) | 124 | 401 | (193 | ) | (20 | ) | 188 | ||||||||||||||||||||
Derivative liabilities: | ||||||||||||||||||||||||||||||||
Commodity contracts | (316 | ) | 113 | 1 | (202 | ) | (332 | ) | 193 | 136 | (3 | ) | ||||||||||||||||||||
Interest rate swaps | — | — | — | — | (16 | ) | — | — | (16 | ) | ||||||||||||||||||||||
Total derivative liabilities | (316 | ) | 113 | 1 | (202 | ) | (348 | ) | 193 | 136 | (19 | ) | ||||||||||||||||||||
Net amounts | $ | (78 | ) | $ | — | $ | — | $ | (78 | ) | $ | 53 | $ | — | $ | 116 | $ | 169 |
(a) | Amounts presented exclude trade accounts receivable and payable related to settled financial instruments. |
(b) | Represents cash amounts received or pledged pursuant to a master netting arrangement, including fair value-based margin requirements and, to a lesser extent, initial margin requirements. |
December 31, 2017 | December 31, 2016 | |||||||||
Derivative type | Notional Volume | Unit of Measure | ||||||||
Natural gas (a) | 1,259 | 1,282 | Million MMBtu | |||||||
Electricity | 114,129 | 75,322 | GWh | |||||||
Congestion Revenue Rights (b) | 110,913 | 126,573 | GWh | |||||||
Coal | 2 | 12 | Million U.S. tons | |||||||
Fuel oil | 5 | 34 | Million gallons | |||||||
Uranium | 325 | 25 | Thousand pounds | |||||||
Interest rate swaps – floating/fixed (c) | $ | 3,000 | $ | 3,000 | Million U.S. dollars |
(a) | Represents gross notional forward sales, purchases and options transactions, locational basis swaps and other natural gas transactions. |
(b) | Represents gross forward purchases associated with instruments used to hedge electricity price differences between settlement points within ERCOT. |
(c) | Includes notional amounts of interest rate swaps that became effective in January 2017 and have maturity dates through July 2023. |
December 31, | |||||||
2017 | 2016 | ||||||
Fair value of derivative contract liabilities (a) | $ | (204 | ) | $ | (31 | ) | |
Offsetting fair value under netting arrangements (b) | 103 | 13 | |||||
Cash collateral and letters of credit | 41 | 1 | |||||
Liquidity exposure | $ | (60 | ) | $ | (17 | ) |
(a) | Excludes fair value of contracts that contain contingent features that do not provide specific amounts to be posted if features are triggered, including provisions that generally provide the right to request additional collateral (material adverse change, performance assurance and other clauses). |
(b) | Amounts include the offsetting fair value of in-the-money derivative contracts and net accounts receivable under master netting arrangements. |
|
Successor | Predecessor | |||||||||||||||
Year Ended December 31, 2017 | Period from October 3, 2016 through December 31, 2016 | Period from January 1, 2016 through October 2, 2016 | Year Ended December 31, 2015 | |||||||||||||
Pension costs | $ | 6 | $ | 2 | $ | 4 | $ | 8 | ||||||||
OPEB costs | 6 | 2 | — | 3 | ||||||||||||
Total benefit costs recognized as expense | $ | 12 | $ | 4 | $ | 4 | $ | 11 |
December 31, | |||||||
2017 | 2016 | ||||||
Asset Category: | |||||||
Level 2 valuations (see Note 15): | |||||||
Interest-bearing cash | $ | (7 | ) | $ | (4 | ) | |
Fixed income securities: | |||||||
Corporate bonds (a) | 65 | 54 | |||||
U.S. Treasuries | 29 | 30 | |||||
Other (b) | 7 | 6 | |||||
Total assets categorized as Level 2 | 94 | 86 | |||||
Assets measured at net asset value (c): | |||||||
Interest-bearing cash | 2 | 2 | |||||
Equity securities: | |||||||
U.S. | 14 | 14 | |||||
International | 13 | 9 | |||||
Fixed income securities: | |||||||
Corporate bonds (a) | 5 | 6 | |||||
Total assets measured at net asset value | 34 | 31 | |||||
Total assets | $ | 128 | $ | 117 |
(a) | Substantially all corporate bonds are rated investment grade by a major ratings agency such as Moody's. |
(b) | Other consists primarily of taxable municipal bonds. |
(c) | Certain investments measured at fair value using the net asset value per share (or its equivalent) have not been classified in the fair value hierarchy. The fair value amounts presented in this line are intended to permit reconciliation of the fair value hierarchy to total Vistra Retirement Plan assets. |
December 31, | |||||||
2017 | 2016 | ||||||
Asset Category: | |||||||
Level 2 valuations (see Note 15): | |||||||
Interest-bearing cash | $ | (7 | ) | $ | (4 | ) | |
Fixed income securities: | |||||||
Corporate bonds (a) | 65 | 54 | |||||
U.S. Treasuries | 29 | 30 | |||||
Other (b) | 7 | 6 | |||||
Total assets categorized as Level 2 | 94 | 86 | |||||
Assets measured at net asset value (c): | |||||||
Interest-bearing cash | 2 | 2 | |||||
Equity securities: | |||||||
U.S. | 14 | 14 | |||||
International | 13 | 9 | |||||
Fixed income securities: | |||||||
Corporate bonds (a) | 5 | 6 | |||||
Total assets measured at net asset value | 34 | 31 | |||||
Total assets | $ | 128 | $ | 117 |
(a) | Substantially all corporate bonds are rated investment grade by a major ratings agency such as Moody's. |
(b) | Other consists primarily of taxable municipal bonds. |
(c) | Certain investments measured at fair value using the net asset value per share (or its equivalent) have not been classified in the fair value hierarchy. The fair value amounts presented in this line are intended to permit reconciliation of the fair value hierarchy to total Vistra Retirement Plan assets. |
Successor | |||||
December 31, 2017 | December 31, 2016 | ||||
Assumed Health Care Cost Trend Rates-Not Medicare Eligible: | |||||
Health care cost trend rate assumed for next year | 7.00 | % | 5.80 | % | |
Rate to which the cost trend is expected to decline (the ultimate trend rate) | 4.50 | % | 5.00 | % | |
Year that the rate reaches the ultimate trend rate | 2026 | 2024 | |||
Assumed Health Care Cost Trend Rates-Medicare Advantage Eligible (2017) / Medicare Eligible (2016): | |||||
Health care cost trend rate assumed for next year | 10.66 | % | 5.70 | % | |
Rate to which the cost trend is expected to decline (the ultimate trend rate) | 4.50 | % | 5.00 | % | |
Year that the rate reaches the ultimate trend rate | 2026 | 2024 |
1-Percentage Point Increase | 1-Percentage Point Decrease | ||||||
Sensitivity Analysis of Assumed Health Care Cost Trend Rates: | |||||||
Effect on accumulated postretirement obligation | $ | 2 | $ | (2 | ) | ||
Effect on postretirement benefits cost | $ | — | $ | — |
December 31, | |||||||
2017 | 2016 | ||||||
Pension Plans with PBO and ABO in Excess Of Plan Assets: | |||||||
Projected benefit obligations | $ | 163 | $ | 144 | |||
Accumulated benefit obligation | $ | 157 | $ | 136 | |||
Plan assets | $ | 128 | $ | 117 |
Asset Category: | Target Allocation Ranges | |||
Fixed income | 74 | % | - | 86% |
U.S. equities | 8 | % | - | 14% |
International equities | 6 | % | - | 12% |
Retirement Plan | ||
Asset Class: | Expected Long-Term Rate of Return | |
U.S. equity securities | 6.4 | % |
International equity securities | 7.3 | % |
Fixed income securities | 3.9 | % |
Weighted average | 4.6 | % |
2018 | 2019 | 2020 | 2021 | 2022 | 2023-27 | ||||||||||||||||||
Pension benefits | $ | 11 | $ | 8 | $ | 8 | $ | 8 | $ | 9 | $ | 50 | |||||||||||
OPEB | $ | 6 | $ | 7 | $ | 8 | $ | 8 | $ | 8 | $ | 39 |
Successor | |||||||
Year Ended December 31, 2017 | Period from October 3, 2016 through December 31, 2016 | ||||||
Assumptions Used to Determine Net Periodic Pension Cost: | |||||||
Discount rate | 4.31 | % | 3.79 | % | |||
Expected return on plan assets | 4.86 | % | 4.89 | % | |||
Expected rate of compensation increase | 3.50 | % | 3.50 | % | |||
Components of Net Pension Cost: | |||||||
Service cost | $ | 5 | $ | 2 | |||
Interest cost | 6 | 1 | |||||
Expected return on assets | (5 | ) | (1 | ) | |||
Net periodic pension cost | $ | 6 | $ | 2 | |||
Other Changes in Plan Assets and Benefit Obligations Recognized in Other Comprehensive Income: | |||||||
Net (gain) loss | $ | 3 | $ | (4 | ) | ||
Total recognized in net periodic benefit cost and other comprehensive income | $ | 9 | $ | (2 | ) | ||
Assumptions Used to Determine Benefit Obligations: | |||||||
Discount rate | 3.74 | % | 4.31 | % | |||
Expected rate of compensation increase | 3.62 | % | 3.50 | % |
Successor | |||||||
Year Ended December 31, 2017 | Period from October 3, 2016 through December 31, 2016 | ||||||
Change in Pension Obligation: | |||||||
Projected benefit obligation at beginning of period | $ | 144 | $ | 154 | |||
Service cost | 5 | 2 | |||||
Interest cost | 6 | 1 | |||||
Actuarial (gain) loss | 13 | (12 | ) | ||||
Benefits paid | (5 | ) | (1 | ) | |||
Projected benefit obligation at end of year | $ | 163 | $ | 144 | |||
Accumulated benefit obligation at end of year | $ | 157 | $ | 136 | |||
Change in Plan Assets: | |||||||
Fair value of assets at beginning of period | $ | 117 | $ | 124 | |||
Actual gain (loss) on assets | 16 | (6 | ) | ||||
Benefits paid | (5 | ) | (1 | ) | |||
Fair value of assets at end of year | $ | 128 | $ | 117 | |||
Funded Status: | |||||||
Projected pension benefit obligation | $ | (163 | ) | $ | (144 | ) | |
Fair value of assets | 128 | 117 | |||||
Funded status at end of year | $ | (35 | ) | $ | (27 | ) | |
Amounts Recognized in the Balance Sheet Consist of: | |||||||
Other current liabilities | $ | — | $ | — | |||
Other noncurrent liabilities | (35 | ) | (27 | ) | |||
Net liability recognized | $ | (35 | ) | $ | (27 | ) | |
Amounts Recognized in Accumulated Other Comprehensive Income Consist of: | |||||||
Net gain | $ | 1 | $ | 4 |
Successor | |||||||
Year Ended December 31, 2017 | Period from October 3, 2016 through December 31, 2016 | ||||||
Assumptions Used to Determine Net Periodic Benefit Cost: | |||||||
Discount rate (Vistra Energy Plan) | 4.11 | % | 4.00 | % | |||
Discount rate (Oncor Plan) | 4.18 | % | 3.69 | % | |||
Components of Net Postretirement Benefit Cost: | |||||||
Service cost | $ | 2 | $ | 1 | |||
Interest cost | 4 | 1 | |||||
Plan amendments (a) | — | (4 | ) | ||||
Net periodic OPEB cost (income) | $ | 6 | $ | (2 | ) | ||
Other Changes in Plan Assets and Benefit Obligations Recognized in Other Comprehensive Income: | |||||||
Net (gain) loss and prior service (credit) cost | $ | 26 | $ | (5 | ) | ||
Total recognized in net periodic benefit cost and other comprehensive income | $ | 32 | $ | (7 | ) | ||
Assumptions Used to Determine Benefit Obligations at Period End: | |||||||
Discount rate (Vistra Energy Plan) | 3.67 | % | 4.11 | % | |||
Discount rate (Split-Participant Plan) | 3.67 | % | — | % | |||
Discount rate (Oncor Plan) | — | % | 4.18 | % |
(a) | Curtailment gain recognized as other income in the statements of consolidated income (loss) as a result of discontinued life insurance benefits for active employees. |
Successor | |||||||
Year Ended December 31, 2017 | Period from October 3, 2016 through December 31, 2016 | ||||||
Change in Postretirement Benefit Obligation: | |||||||
Benefit obligation at beginning of year | $ | 88 | $ | 97 | |||
Service cost | 2 | 1 | |||||
Interest cost | 4 | 1 | |||||
Participant contributions | 2 | 1 | |||||
Plan amendments (a) | 11 | (4 | ) | ||||
Actuarial (gain) loss | 15 | (5 | ) | ||||
Benefits paid | (7 | ) | (3 | ) | |||
Benefit obligation at end of year | $ | 115 | $ | 88 | |||
Change in Plan Assets: | |||||||
Fair value of assets at beginning of year | $ | — | $ | — | |||
Employer contributions | 5 | 1 | |||||
Participant contributions | 2 | 1 | |||||
Benefits paid | (7 | ) | (2 | ) | |||
Fair value of assets at end of year | $ | — | $ | — | |||
Funded Status: | |||||||
Benefit obligation | $ | 115 | $ | 88 | |||
Funded status at end of year | $ | 115 | $ | 88 | |||
Amounts Recognized on the Balance Sheet Consist of: | |||||||
Other current liabilities | $ | 6 | $ | 5 | |||
Other noncurrent liabilities | 109 | 83 | |||||
Net liability recognized | $ | 115 | $ | 88 | |||
Amounts Recognized in Accumulated Other Comprehensive Income Consist of: | |||||||
Net loss and prior service cost | $ | 20 | $ | 5 |
(a) | For the year ended December 31, 2017, plan amendments relate to the contractual arrangement with Oncor covering Split Participants. For the period from October 3, 2016 through December 31, 2016, a curtailment gain was recognized as other income in the statements of consolidated income (loss) as a result of discontinued life insurance benefits for active employees. |
|
Successor | |||||||
Year Ended December 31, 2017 | Period from October 3, 2016 through December 31, 2016 | ||||||
Total stock-based compensation expense | $ | 19 | $ | 3 | |||
Income tax benefit | (7 | ) | (1 | ) | |||
Stock based-compensation expense, net of tax | $ | 12 | $ | 2 |
Successor | ||||||||||||
Year Ended December 31, 2017 | ||||||||||||
Stock Options (in thousands) | Weighted Average Exercise Price | Weighted Average Remaining Contractual Term (Years) | Aggregate Intrinsic Value (in millions) | |||||||||
Total outstanding at beginning of period | 7,357 | $ | 15.81 | 9.8 | $ | — | ||||||
Granted | 1,412 | $ | 18.86 | |||||||||
Exercised | (281 | ) | $ | 13.41 | ||||||||
Forfeited or expired | (352 | ) | $ | 13.76 | ||||||||
Total outstanding at end of period | 8,136 | $ | 14.44 | 9.0 | $ | 32.4 | ||||||
Expected to vest | 6,618 | $ | 14.65 | 9.1 | $ | 25.1 |
Successor | ||||||||||||
Year Ended December 31, 2017 | ||||||||||||
Restricted Stock Units (in thousands) | Weighted Average Grant Date Fair Value | Weighted Average Remaining Contractual Term (Years) | Aggregate Intrinsic Value (in millions) | |||||||||
Total outstanding at beginning of period | 2,159 | $ | 15.79 | 2.3 | $ | 33.5 | ||||||
Granted | 861 | $ | 18.84 | |||||||||
Exercised | (538 | ) | $ | 15.76 | ||||||||
Forfeited or expired | (107 | ) | $ | 15.85 | ||||||||
Total outstanding at end of period | 2,375 | $ | 16.91 | 1.9 | $ | 43.5 | ||||||
Expected to vest | 2,375 | $ | 16.91 | 1.9 | $ | 43.5 |
|
Successor | |||||||
Year Ended December 31, 2017 | Period from October 3, 2016 through December 31, 2016 | ||||||
Operating revenues (a) | |||||||
Wholesale Generation | $ | 2,758 | $ | 450 | |||
Retail Electricity | 4,058 | 912 | |||||
Eliminations | (1,386 | ) | (171 | ) | |||
Consolidated operating revenues | $ | 5,430 | $ | 1,191 | |||
Depreciation and amortization | |||||||
Wholesale Generation | $ | 230 | $ | 53 | |||
Retail Electricity | 430 | 153 | |||||
Corporate and Other | 40 | 11 | |||||
Eliminations | (1 | ) | $ | (1 | ) | ||
Consolidated depreciation and amortization | $ | 699 | $ | 216 | |||
Operating income (loss) | |||||||
Wholesale Generation | $ | (186 | ) | $ | (255 | ) | |
Retail Electricity | 461 | 111 | |||||
Corporate and Other | (77 | ) | (17 | ) | |||
Consolidated operating income (loss) | $ | 198 | $ | (161 | ) | ||
Interest expense and related charges | |||||||
Wholesale Generation | $ | 21 | $ | (1 | ) | ||
Corporate and Other | 252 | 66 | |||||
Eliminations | (80 | ) | (5 | ) | |||
Consolidated interest expense and related charges | $ | 193 | $ | 60 | |||
Income tax expense (benefit)(all Corporate and Other) | $ | 504 | $ | (70 | ) | ||
Net income (loss) | |||||||
Wholesale Generation | $ | (177 | ) | $ | (251 | ) | |
Retail Electricity | 495 | 114 | |||||
Corporate and Other | (572 | ) | (26 | ) | |||
Consolidated net income (loss) | $ | (254 | ) | $ | (163 | ) | |
Capital expenditures | |||||||
Wholesale Generation | $ | 150 | $ | 84 | |||
Retail Electricity | — | 5 | |||||
Corporate and Other | 26 | — | |||||
Consolidated capital expenditures | $ | 176 | $ | 89 |
(a) | For the Successor period for the year ended December 31, 2017 and the period from October 3, 2016 through December 31, 2016, includes third-party unrealized net gains (losses) from mark-to-market valuations of commodity positions of $(151) million and $(182) million, respectively, recorded to the Wholesale Generation segment and $18 million and $(6) million, respectively, recorded to the Retail Electricity segment. In addition, for the Successor period for the year ended December 31, 2017 and the period from October 3, 2016 through December 31, 2016, unrealized net gains (losses) with affiliate of $(154) million and $(113) million, respectively, were recorded to operating revenues for the Wholesale Generation segment and corresponding unrealized net gains (losses) with affiliate of $154 million and $113 million, respectively, were recorded to fuel, purchased power costs and delivery fees for the Retail Electricity segment, with no impact to consolidated results. |
December 31, | |||||||
2017 | 2016 | ||||||
Total assets | |||||||
Wholesale Generation | $ | 7,069 | $ | 6,952 | |||
Retail Electricity | 6,156 | 5,753 | |||||
Corporate and Other and Eliminations | 1,375 | 2,462 | |||||
Consolidated total assets | $ | 14,600 | $ | 15,167 |
|
Successor | Predecessor | |||||||||||||||
Year Ended December 31, 2017 | Period from October 3, 2016 through December 31, 2016 | Period from January 1, 2016 through October 2, 2016 | Year Ended December 31, 2015 | |||||||||||||
Other income: | ||||||||||||||||
Office space sublease rental income (a) | $ | 11 | $ | 2 | $ | — | $ | — | ||||||||
Mineral rights royalty income (b) | 3 | 1 | 3 | 4 | ||||||||||||
Sale of land (b) | 4 | — | — | — | ||||||||||||
Curtailment gain on employee benefit plans (a) | — | 4 | — | — | ||||||||||||
Insurance settlement | — | — | 9 | — | ||||||||||||
Interest income | 15 | 1 | 3 | 1 | ||||||||||||
All other | 4 | 2 | 4 | 13 | ||||||||||||
Total other income | $ | 37 | $ | 10 | $ | 19 | $ | 18 | ||||||||
Other deductions: | ||||||||||||||||
Write-off of generation equipment (b) | 2 | — | 45 | — | ||||||||||||
Adjustment to asbestos liability | — | — | 11 | — | ||||||||||||
Impairment of favorable purchase contracts (Note 7) | — | — | — | 8 | ||||||||||||
Impairment of emission allowances (Note 7) | — | — | — | 55 | ||||||||||||
Impairment of mining development costs | — | — | — | 19 | ||||||||||||
All other | 3 | — | 19 | 11 | ||||||||||||
Total other deductions | $ | 5 | $ | — | $ | 75 | $ | 93 |
(a) | Reported in Corporate and Other non-segment (Successor period only). |
(b) | Reported in Wholesale Generation segment (Successor period only). |
December 31, 2017 | December 31, 2016 | ||||||||||||||
Current Assets | Noncurrent Assets | Current Assets | Noncurrent Assets | ||||||||||||
Amounts related to the Vistra Operations Credit Facilities (Note 12) | $ | — | $ | 500 | $ | — | $ | 650 | |||||||
Amounts related to restructuring escrow accounts | 59 | — | 90 | — | |||||||||||
Other | — | — | 5 | — | |||||||||||
Total restricted cash | $ | 59 | $ | 500 | $ | 95 | $ | 650 |
Successor | Predecessor | |||||||||||||||
Year Ended December 31, 2017 | Period from October 3, 2016 through December 31, 2016 | Period from January 1, 2016 through October 2, 2016 | Year Ended December 31, 2015 | |||||||||||||
Allowance for uncollectible accounts receivable at beginning of period | $ | 10 | $ | — | $ | 9 | $ | 15 | ||||||||
Increase for bad debt expense | 43 | 10 | 20 | 34 | ||||||||||||
Decrease for account write-offs | (39 | ) | — | (16 | ) | (40 | ) | |||||||||
Allowance for uncollectible accounts receivable at end of period | $ | 14 | $ | 10 | $ | 13 | $ | 9 |
December 31, | |||||||
2017 | 2016 | ||||||
Wholesale and retail trade accounts receivable | $ | 596 | $ | 622 | |||
Allowance for uncollectible accounts | (14 | ) | (10 | ) | |||
Trade accounts receivable — net | $ | 582 | $ | 612 |
December 31, | |||||||
2017 | 2016 | ||||||
Materials and supplies | $ | 149 | $ | 173 | |||
Fuel stock | 83 | 88 | |||||
Natural gas in storage | 21 | 24 | |||||
Total inventories | $ | 253 | $ | 285 |
December 31, | |||||||
2017 | 2016 | ||||||
Nuclear plant decommissioning trust | $ | 1,188 | $ | 1,012 | |||
Land | 49 | 49 | |||||
Miscellaneous other | 3 | 3 | |||||
Total other investments | $ | 1,240 | $ | 1,064 |
December 31, 2017 | |||||||||||||||
Cost (a) | Unrealized gain | Unrealized loss | Fair market value | ||||||||||||
Debt securities (b) | $ | 418 | $ | 14 | $ | (2 | ) | $ | 430 | ||||||
Equity securities (c) | 265 | 495 | (2 | ) | 758 | ||||||||||
Total | $ | 683 | $ | 509 | $ | (4 | ) | $ | 1,188 |
December 31, 2016 | |||||||||||||||
Cost (a) | Unrealized gain | Unrealized loss | Fair market value | ||||||||||||
Debt securities (b) | $ | 333 | $ | 10 | $ | (3 | ) | $ | 340 | ||||||
Equity securities (c) | 309 | 368 | (5 | ) | 672 | ||||||||||
Total | $ | 642 | $ | 378 | $ | (8 | ) | $ | 1,012 |
(a) | Includes realized gains and losses on securities sold. |
(b) | The investment objective for debt securities is to invest in a diversified tax efficient portfolio with an overall portfolio rating of AA or above as graded by S&P or Aa2 by Moody's Investors Services, Inc. The debt securities are heavily weighted with government and municipal bonds and investment grade corporate bonds. The debt securities had an average coupon rate of 3.55% and 3.56% at December 31, 2017 and 2016, respectively, and an average maturity of 9 years at both December 31, 2017 and 2016. |
(c) | The investment objective for equity securities is to invest tax efficiently and to match the performance of the S&P 500 Index. |
Successor | Predecessor | |||||||||||||||
Year Ended December 31, 2017 | Period from October 3, 2016 through December 31, 2016 | Period from January 1, 2016 through October 2, 2016 | Year Ended December 31, 2015 | |||||||||||||
Realized gains | $ | 9 | $ | 1 | $ | 3 | $ | 1 | ||||||||
Realized losses | $ | (11 | ) | $ | — | $ | (2 | ) | $ | (1 | ) | |||||
Proceeds from sales of securities | $ | 252 | $ | 25 | $ | 201 | $ | 401 | ||||||||
Investments in securities | $ | (272 | ) | $ | (30 | ) | $ | (215 | ) | $ | (418 | ) |
December 31, | |||||||
2017 | 2016 | ||||||
Wholesale Generation: | |||||||
Generation and mining | $ | 4,501 | $ | 3,997 | |||
Retail Electricity | 5 | 3 | |||||
Corporate and Other | 120 | 107 | |||||
Total | 4,626 | 4,107 | |||||
Less accumulated depreciation | (282 | ) | (54 | ) | |||
Net of accumulated depreciation | 4,344 | 4,053 | |||||
Nuclear fuel (net of accumulated amortization of $111 million and $31 million) | 158 | 166 | |||||
Construction work in progress: | |||||||
Wholesale Generation | 312 | 210 | |||||
Retail Electricity | — | 6 | |||||
Corporate and Other | 6 | 8 | |||||
Total construction work in progress | 318 | 224 | |||||
Property, plant and equipment — net | $ | 4,820 | $ | 4,443 |
Nuclear Plant Decommissioning | Mining Land Reclamation | Other | Total | ||||||||||||
Predecessor: | |||||||||||||||
Liability at December 31, 2015 | $ | 508 | $ | 215 | $ | 107 | $ | 830 | |||||||
Additions: | |||||||||||||||
Accretion — January 1, 2016 through October 2, 2016 | 22 | 16 | 5 | 43 | |||||||||||
Adjustment for new cost estimate | — | — | 1 | 1 | |||||||||||
Incremental reclamation costs | — | 14 | 12 | 26 | |||||||||||
Reductions: | |||||||||||||||
Payments — January 1, 2016 through October 2, 2016 | — | (37 | ) | (3 | ) | (40 | ) | ||||||||
Liability at October 2, 2016 | 530 | 208 | 122 | 860 | |||||||||||
Less amounts due currently | — | (50 | ) | (1 | ) | (51 | ) | ||||||||
Noncurrent liability at October 2, 2016 | $ | 530 | $ | 158 | $ | 121 | $ | 809 | |||||||
Successor: | |||||||||||||||
Fair value of liability established at October 3, 2016 | $ | 1,192 | $ | 374 | $ | 152 | $ | 1,718 | |||||||
Additions: | |||||||||||||||
Accretion — October 3, 2016 through December31, 2016 | 8 | 5 | 1 | 14 | |||||||||||
Reductions: | |||||||||||||||
Payments — October 3, 2016 through December31, 2016 | — | (4 | ) | (2 | ) | (6 | ) | ||||||||
Liability at December 31, 2016 | 1,200 | 375 | 151 | 1,726 | |||||||||||
Additions: | |||||||||||||||
Accretion | 33 | 18 | 8 | 59 | |||||||||||
Adjustment for change in estimates (a) | — | 81 | 44 | 125 | |||||||||||
Incremental reclamation costs (b) | — | — | 62 | 62 | |||||||||||
Reductions: | |||||||||||||||
Payments | — | (36 | ) | — | (36 | ) | |||||||||
Liability at December 31, 2017 | 1,233 | 438 | 265 | 1,936 | |||||||||||
Less amounts due currently | — | (93 | ) | (6 | ) | (99 | ) | ||||||||
Noncurrent liability at December 31, 2017 | $ | 1,233 | $ | 345 | $ | 259 | $ | 1,837 |
December 31, | |||||||
2017 | 2016 | ||||||
Unfavorable purchase and sales contracts | $ | 36 | $ | 46 | |||
Other, including retirement and other employee benefits | 220 | 174 | |||||
Total other noncurrent liabilities and deferred credits | $ | 256 | $ | 220 |
Year | Amount | |||
2018 | $ | 11 | ||
2019 | $ | 9 | ||
2020 | $ | 9 | ||
2021 | $ | 1 | ||
2022 | $ | 3 |
December 31, 2017 | December 31, 2016 | |||||||||||||||
Debt: | Carrying Amount | Fair Value | Carrying Amount | Fair Value | ||||||||||||
Long-term debt under the Vistra Operations Credit Facilities (Note 12) | $ | 4,323 | $ | 4,334 | $ | 4,515 | $ | 4,552 | ||||||||
Other long-term debt, excluding capital lease obligations (Note 12) | 30 | 27 | 36 | 32 | ||||||||||||
Mandatorily redeemable subsidiary preferred stock (Note 12) | 70 | 70 | 70 | 70 |
Successor | Predecessor | |||||||||||||||
Year Ended December 31, 2017 | Period from October 3, 2016 through December 31, 2016 | Period from January 1, 2016 through October 2, 2016 | Year Ended December 31, 2015 | |||||||||||||
Cash payments related to: | ||||||||||||||||
Interest paid (a) | $ | 245 | $ | 19 | $ | 1,064 | $ | 1,298 | ||||||||
Capitalized interest | (7 | ) | (3 | ) | (9 | ) | (11 | ) | ||||||||
Interest paid (net of capitalized interest) (a) | $ | 238 | $ | 16 | $ | 1,055 | $ | 1,287 | ||||||||
Income taxes | $ | 63 | $ | (2 | ) | $ | 22 | $ | 29 | |||||||
Reorganization items (b) | $ | — | $ | — | $ | 104 | $ | 224 | ||||||||
Noncash investing and financing activities: | ||||||||||||||||
Construction expenditures (c) | $ | 12 | $ | 1 | $ | 53 | $ | 75 |
(a) | Predecessor period includes amounts paid for adequate protection. |
(b) | Represents cash payments made by our Predecessor for legal and other consulting services, including amounts paid on behalf of third parties pursuant to contractual obligations approved by the Bankruptcy Court. |
(c) | Represents end-of-period accruals for ongoing construction projects. |
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