CPN: Calpine Corporation Message Board

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Gold/Mining/Energy : CPN: Calpine Corporation

FRO 23.66

-0.3%

Nov 7 9:30 AM EST

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To: Winkman777 who wrote (262)	2/1/2002 9:45:39 AM
From: Winkman777	of 555

GS on CPN earnings: EPS FOR 2002 BASED ON DEPRESSED COMMODITY PRICES: Our $1.55 estimate for 2002 EPS assumes CPN's unhedged baseload gas-fired assets (representing over 32 million MWhs or 65% of power sales) operate at an average spark spread of $7/MWh and receive roughly $1/MWh of payments for other premium services. At this level of pricing, the unhedged generation would operate at a slight loss. We assume CPN's peaking projects, both hedged and unhedged, generate no net income. We estimate that every $1/MWh move in CPN's unhedged margin impacts 2002 EPS by $0.05. EPS FOR 2003 ASSUMES A RECOVERY IN COMMODITY PRICES: Our $2.30 estimate for 2003 EPS assumes a recovery in spark spreads for the 50% of expected baseload output in 2003 that is unhedged. Our forecast also assumes an average EBITDA contribution of $75,000/KW for the company's peaking assets. If realized spark spreads did not improve versus what we have assumed for 2002, earnings in 2003 would be closer to $1.75/share. We estimate that every $1/MWh move in CPN's unhedged margin impacts 2003 EPS by $0.08.

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