A Powerful Combination
July 31, 2000
<PAGE>
Today's Presenters
James L. Broadhead J. Wayne Leonard
Chairman, President and Chief Executive Officer
Chief Executive Officer
FPL Group, Inc. Entergy Corporation
1
<PAGE>
Safe Harbor Statement
Safe Harbor Statement under the Private Securities Litigation Reform Act of
1995:
This presentation contains forward looking statements within the meaning of
the "safe harbor" provisions of the United States Private Securities
Litigation Reform Act of 1995. Investors are cautioned that such
forward-looking statements with respect to revenues, earnings, performance,
strategies, prospects and other aspects of the businesses of FPL Group, Inc.
and Entergy Corporation are based on current expectations that are subject to
risk and uncertainties. A number of factors could cause actual results or
outcomes to differ materially from those indicated by such forward looking
statements. These factors include, but are not limited to, risks and
uncertainties relating to: changes in laws or regulations, changing
governmental policies and regulatory actions with respect to allowed rates of
return including but not limited to return on equity and equity ratio limits,
industry and rate structure, operation of nuclear power facilities,
acquisition, disposal, depreciation and amortization of assets and facilities,
operation and construction of plant facilities, recovery of fuel and purchased
power costs, decommissioning costs, present or prospective wholesale and
retail competition (included but not limited to retail wheeling and
transmission costs), political and economic risks, changes in and compliance
with environmental and safety laws and policies, weather conditions (including
natural disasters such as hurricanes), population growth rates and demographic
patterns, competition for retail and wholesale customers, availability,
pricing and transportation of fuel and other energy commodities, market demand
for energy from plants or facilities, changes in tax rates or policies or in
rates of inflation or in accounting standards, unanticipated delays or changes
in costs for capital projects, unanticipated changes in operating expenses and
capital expenditures, capital market conditions, competition for new energy
development opportunities and legal and administrative proceedings (whether
civil, such as environmental, or criminal) and settlements and other factors.
Readers are referred to FPL Group, Inc.'s and Entergy Corporation's most
recent reports filed with the Securities and Exchange Commission.
2
<PAGE>
James L. Broadhead
Chairman, President and
Chief Executive Officer
FPL Group, Inc.
3
<PAGE>
Transaction Highlights
Merger of Equals: FPL Group Owns 57% (1.0 share)
Entergy Owns 43% (0.585 share)
Management: James L. Broadhead - Chairman
J. Wayne Leonard - President & CEO
Board Members: 8 from FPL Group
7 from Entergy
Corporate HQ: Juno Beach, Florida
Utility Group HQ: New Orleans, Louisiana
Dividend: FPL Group's - Currently $2.16
4
<PAGE>
Creating Shareholder Value
o Transaction is immediately accretive
o Annual synergies of $150 million - $275 million
o Earnings per share growth of 10% or more
o Secure dividend
o $1 billion share repurchase authorization
5
<PAGE>
Substantial Anticipated Synergies
2002-2004 Annual Synergies Growth* ($M)
[CHART OMITTED]
$375 in 2004
100
=
125
+
50
150 $200 in 2002
+
40
110
--------------------------------------------------------------------------------
Utility Comprehensive Competitive Total Synergies
CapEx
* Synergies are pre-tax and do not include cost to achieve.
6
<PAGE>
Regulatory Action Plan
Federal State/Local
SEC
AR FL LA
FERC
TX MS New Orleans
NRC
Target: Close Within 15 Months
7
<PAGE>
A Powerful Combination
o Scope and scale to exploit changing marketplace
8
<PAGE>
Creating an Industry Leader
U.S. Utility Ranking
Customers #1
6.3 million
General Capacity #1
48,000+ MW
Nuclear Generation #2
10,000+ MW
Equity Market Value #2
$16.4 billion
9
<PAGE>
A Powerful Combination
o Scope and scale to exploit changing marketplace
o Superior financial strength
o Strong set of core competencies
o Management focus on shareholder value
10
<PAGE>
A Merger of Equals
The Nation's
Largest
Power Company
Top-Performing Leading
Super-Regional Wholesale Energy
Utility Business
11
<PAGE>
FPL Entergy
Group
A Super Regional Utility
Solid and Growing Customer Base
[Graphic Omitted]
[Map]
38,400 MW Capacity
Service Areas 6.3 Million Customers
12
<PAGE>
A Top-Performing Utility
What's Needed for Success Combined Platform
Strong customer base #1 in customers
High growth regions
Superior generating capacity #1 in generating capacity
High plant availability
Quality service Top quartile performer
Low cost operations in reliability, customer
Strong regulatory relations service and price
Other competitive advantages Clean generation
Strong cash flow
13
<PAGE>
A Merger of Equals
The Nation's
Largest
Power Company
Top-Performing Leading
Super-Regional Wholesale Energy
Utility Business
14
<PAGE>
FPL Entergy
Group
Strong Combined Presence in Key Regions
A Leading Independent Power Producer
Northeast
Hub
Midwest
Hub
[Graphic omitted]
Western [Map]
Hub
Southeast
Hub
FPL Energy Sites
Entergy Sites
Gulf South Hub
15
<PAGE>
A Leading Wholesale Energy Business
What's Needed for Success Combined Platform
Large generation base 9,800 MW, predominantly
nuclear and gas
Development pipeline Growing to 30,000+ MW by 2004
Low-cost construction, turbine
Construction skills availability & scale economies
(Shaw)
Superior plant operations World-class skills
Risk management Top 10 trading company (Koch)
& asset optimization
Regional portfolios Complementary regional
presence
16
<PAGE>
J. Wayne Leonard
Chief Executive Officer
Entergy Corporation
17
<PAGE>
A Merger of Equals
The Nation's
Largest
Power Company
Top-Performing Leading
Super-Regional Wholesale Energy
Utility Business
18
<PAGE>
A Diversified and Balanced Customer Base
1999 Retail MWh by Customer Class (%)
Entergy FPL Group Combined
[Graphic Omitted] [Graphic Omitted] [Graphic Omitted]
[Pie Chart] [Pie Chart] [Pie Chart]
3% 2% 3%
30% 5% 25%
43% 41% 41%
24% 52% 31%
Residential Commercial Industrial Other
19
<PAGE>
The Largest Generator - and One of the Cleanest
'000s MW Capacity by Generation Mix
45
Oil/Other
Coal
30 Nuclear
Gas
[Graphic Omitted]
[Bar Chart]
15
0
Combined AEP/CSR SO PE/UCM ETR TXU ED/NU CPL/FPC DUK FPL
-------------------------------------------------------------------------------
Clean MW 31 11 5 16 18 15 12 7 7 13
in 000s
% clean 79% 29% 15% 58% 80% 72% 69% 43% 39% 78%
(gas +
nuclear)
-------------------------------------------------------------------------------
Source: RDI, 1998 data
20
<PAGE>
An Environmental Advantage - Low Emissions
2500 CO2 Emissions
[Graphic Omitted]
[Bar Chart]
lbs/MWH
0 CIN DTE AEP/CSR SO CMS CPL/FPC TXU NSP GPU PPL ED PNW D DUK FPL
ETR PEG NMK EIX PE/UCM
25 SO2 Emissions
[Graphic Omitted]
[Bar Chart]
lbs/MWh
0 CIN PPL GPU SO NMK CPL/FPC AEP/CSR DTE D CMS DUK TXU PSEG FPL
NSP PNW ETR PE/UCM EIX ED
7 NOx Emissions
[Graphic Omitted]
[Bar Chart]
lbs/MWh
0 CIN AEP/CSR CPL/FPC DTE CMS NSP DUK SO D PPL GPU TXU PNW PEG
ETR FPL PE/UCM NMK EIX ED
Source: Natural Resource Defense Council, 1998, for SPELEC companies available
21
<PAGE>
A Merger of Equals
The Nation's
Largest
Power Company
Top-Performing Leading
Super-Regional Wholesale Energy
Utility Business
22
<PAGE>
A Growing Competitive Portfolio
9,800 MW 33,400 MW
in 2000* by 2004
[Graphic Omitted] [Graphic Omitted]
[Pie Chart [Pie Chart
Nuclear Gas Nuclear Gas
26% 48% 34% 56%
Other Other
15% 5%
Renewables
11% Renewables
5%
23
<PAGE>
Turbine Availability Supports Growth
MW
18,000
[Graphic Omitted]
[Bar Chart]
12,000
6,000
0
2000 2001 2002 2003 2004 2005
# Of
Turbines 1 7 16 21 21 10 Total
Delivered 76
24
<PAGE>
Aggressive Development Schedule
Cumulative MW Operating
MW
35,000
[Graphic Omitted] Late Stage
30,000 [Area Chart] Development
25,000 Announced/
36% Annual Growth Under Construction
20,000
Acquired
15,000 Nuclear
5,000 Operating
0
2000 2001 2002 2003 2004
25
<PAGE>
Premier National Nuclear Company
What's Needed for Success Combined Platform
Recognized leader in industry with
Nuclear core competency PWR, BWR, turnaround experience
Large fleet More than 10,000 MWs
Regional economies of scale 2,475 MW in Northeast
Building expertise through
Decommissioning capabilities service contracts
Management resources Strong, deep bench
Experience with license transfer
Strong regulatory interface and extension
Efficient operations High plant availability
26
<PAGE>
Trading and Marketing - Scale and Skills
What's Needed for Success Combined Platform
Physical gas trading Top 7-9 (7-8 BCF/D)
Financial gas trading Top 3-5 (40-60 BCF/D)
Electricity trading Top 5-7 (120 million MWh)
Weather derivatives market 30% of market
Access to strategic as assets 10,000 mile Gateway
Access to power assets 10,000 MWs and growing
Access to resid/gas
switching capability 100-150 MBPD
Access to retail load 6.3 million customers
[Graphic Omitted]
27
<PAGE>
Scale Improves Optionality
Top 15 U.S. Consumers of Natural Gas
BCF/D
2
[Graphic Omitted]
[Bar Chart]
1
0
Combined ETR TXU REI CSR FPL NCE/ SO DOW LTV X DUK BS KSE XOM
NSP
Source: RDI, 1999 data
28
<PAGE>
Gateway - A Strategically Positioned Pipeline
[Graphic Omitted]
[Map]
Enron/Sonat's Florida
Gas Transport Pipeline
Entergy-Koch's
Gateway Pipeline
Williams/Duke's
Proposed
Buccaneer Pipeline
29
<PAGE>
FPL FiberNet - A Value Enhancer
FPL FiberNet - 1,600 route miles Entergy Fiber Networks - 2,150 route miles
[Graphic Omitted] [Graphic Omitted]
[Map] [Map]
o 2,750 route miles
Combined o FPL FiberNet building 15 metro intra-city networks
Platform and plans > 500,000 fiber miles
o Opportunity to extend to Entergy's metro areas
30
<PAGE>
Financial Headroom Low Dividend/Low Debt
0%
30%
60%
90%
120%
20% 40% 60%
High Dividend/High Debt High Dividend/Low Debt
Common Equity Ratio
Source: Bloomberg
31
<PAGE>
Strong Cash Flow
Operating Cash Flows
$(B)
4.0
[Graphic Omitted]
[Bar Chart]
2.0
0.0
2002 2003 2004
32
<PAGE>
"Pure Play" Value Proposition
6.3 million customers
+ 48,000 MW generation
+ 20,000 MAW project pipeline
+ 10,000 mile gas pipeline
= A Wealth of Value
+ Trading and marketing
Sources of
Value
+ 21,500 transmission miles
+ 151,900 distribution miles
+ 3,750 route mile fiber network
33
<PAGE>
A Powerful Combination
Strategy:
_______________________________________________________________________________
o Maintain and enhance utility operations
o Profitably grow wholesale portfolio [Checkmark]
o Enhance growth through additional strategic ventures
_______________________________________________________________________________
Platform:
_______________________________________________________________________________
o Premier utility franchises in growing Gulf South region
o Strategically positioned on nation's largest natural gas resource
o 48,000 MW of balanced generation capacity [Checkmark]
o World-class trading and market capabilities
_______________________________________________________________________________
Execution:
_______________________________________________________________________________
o Proven management team
[Checkmark]
o Track record of delivering on our promises
_______________________________________________________________________________
Results:
_______________________________________________________________________________
o Earnings per share growth of 10% or more
o Excellent cash flow postion
[Checkmark]
o Strong balance sheet
o Immediately accretive
_______________________________________________________________________________
34
<PAGE>
Addendum
In connection with the proposed merger, FPL Group, Inc. and Entergy
Corporation will file a joint proxy statement / prospectus with the
Securities and Exchange Commission. INVESTORS AND SECURITY HOLDERS ARE
ADVISED TO READ THE JOINT PROXY STATEMENT / PROSPECTUS WHEN IT BECOMES
AVAILABLE, BECAUSE IT WILL CONTAIN IMPORTANT INFORMATION. Investors and
security holders may obtain a free copy of the joint proxy statement /
prospectus (when available) and other documents filed by FPL Group, Inc.
and Entergy Corporation with the Commission at the Commission's web site at
http://www.sec.gov. Free copies of the joint proxy statement / prospectus,
once available, and each company's other filings with the Commission may
also be obtained from the respective companies. Free copies of the FPL
Group's filings may be obtained by directing a request to FPL Group, Inc.,
700 Universe Blvd., P.O. Box 14000, Juno Beach, FL 33408-0420, Telephone:
(561) 694-4000. Free copies of Entergy's filings may be obtained by
directing a request to Entergy Corporation, 639 Loyola Avenue, New Orleans,
Louisiana 70113, Telephone: (504) 576-4000.
Participants in Solicitation
FPL Group, Inc., Entergy Corporation and their respective directors,
executive officers and other members of their management and employees may
be soliciting proxies from their respective stockholders in favor of the
merger. Information concerning FPL Group's participants in the solicitation
is set forth in FPL Group's Current Report on Form 8-K filed with the
Commission on July 31, 2000, and information concerning Entergy's
participants in the solicitation is set forth in Entergy's Current Report
on Form 8-K filed with the Commission on July 31, 2000.
35
<PAGE>
A Powerful Combination
