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Enron Overview Jeff Skilling April 3, 2001. 2 UB-SMETHODIST-0301 Enron Annual Revenues 20.3B 31.3B 100.8B 40.1B + 54% + 28% + 151%

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Presentation on theme: "Enron Overview Jeff Skilling April 3, 2001. 2 UB-SMETHODIST-0301 Enron Annual Revenues 20.3B 31.3B 100.8B 40.1B + 54% + 28% + 151%"— Presentation transcript:

1 Enron Overview Jeff Skilling April 3, 2001

2 2 UB-SMETHODIST-0301 Enron Annual Revenues 20.3B 31.3B 100.8B 40.1B + 54% + 28% + 151%

3 3 UB-SMETHODIST-0301 $0.87 $1.00 $1.47 $ % + 18% + 25% Earnings Performance (Recurring Per Diluted Share)

4 4 UB-SMETHODIST-0301 Management Efficiency Source: msn-MoneyCentral © ,000 32,000 43, Mil 894, Mil Income per Employee Revenue per Employee Enron Industry S&P Utilities Enron Industry S&P Utilities

5 5 UB-SMETHODIST-0301 Enron Market Value* 12.8B 18.9B 62.5B 31.8B *Uses basic shares outstanding at 12/31

6 6 UB-SMETHODIST-0301 Enron Price/Earnings Ratio

7 7 UB-SMETHODIST-0301 Total Return to Shareholders Jan 1, 1990 to February 28, Dec 97 Dec 96Dec 95 Dec 94 Dec 93 Dec 92 Dec 91 Dec 90 Enron Corp. S&P 500 Pipeline Avg. Utility Avg. E&P Avg. 1,151% 354% 571% 246% 183% Dec 00 Dec 99 Dec 98 Note: Calculated to February 28, 2001 Jan 01 Feb 01

8 8 UB-SMETHODIST-0301 Enron Corp Enron Transportation Services Enron Wholesale Services Enron Energy Services Enron Broadband Services

9 9 UB-SMETHODIST-0301 Enron Opportunity Traditional Model New Model Asset intensive Vertically integrated Slow moving and rigid Hierarchical Brain power intensive Networked Real options oriented Fast moving & entrepreneurial

10 10 UB-SMETHODIST-0301 Changes in the Marketplace Interaction costs declining due to streamlining, standardization and automation Cost/benefit of vertical integration and consolidation significantly reduced Efficient sourcing and packaging produces lowest cost product –Legal –Research –Documentation –Logistics – Sales – Procurement – Credit – Inventory – Settlement

11 11 UB-SMETHODIST-0301 Enrons Network Advantages Significant Competitive Advantages for Entering New Markets Access to Physical Product Delivery Logistics Expertise Leading Market-Making Capabilities Risk Management Expertise Ability to Structure Complex Customized Solutions Well-Developed E-commerce

12 12 UB-SMETHODIST-0301 Robust, Flexible Network Scope and Scale Liquidity Market-Making Risk Management Technology Finance Enrons Advantage Wholesale Merchant Opportunities Commodity Risk Management Benefits of Regional Arbitrage Cross Commodity Arbitrage Long-Term Origination Wholesale Outsourcing Asset Restructurings Structured Finance Enrons Capabilities Enable Unique Value Creation High Value Applications

13 13 UB-SMETHODIST ,970 Power and Other Gas Physical Volumes (BBtue/d) 99,337 Financial Settlements (BBtue/d) ,308 32,429 51, ,148 75,266 49,082 Wholesale Services

14 14 UB-SMETHODIST-0301 Expansion of Existing Business Weather Over 7,500 TBtue Avg. Daily Deliveries 240 Customers in 46 Countries Over 100,000 Tonnes Avg. Daily Deliveries 190 Customers in 17 Countries Over $1.5 Million (Notional) Average Daily Contracts 30 Customers in 8 Countries ,629 Crude and Products 5,099 7,435 8,305 9, (Transactions) Coal , (Transactions)

15 15 UB-SMETHODIST-0301 Enron–Accelerating Market Development Commodity Product Financial Australian Power & Gas Bandwidth Metals Natural Gas Electricity UK Power & Gas Financials (interest rate, equity) Emissions Plastics Scandinavian Power & Gas Weather Coal Pulp & Paper Currencies * Lighter shading indicates a developing market Darker shading indicates a mature market

16 16 UB-SMETHODIST-0301 Consultants Software Vendor Controls Manufacturers Architects Engineers Mechanical Contractors HVAC Svc Companies Specialty Contractors Utilities Internal Treasury Lenders Electrical Contractors In-house Coordination Enron Outsourcing Approach Equipment Manufacturers Commodity Management Commodity Management Energy Information Management Capital Management Capital Management Energy Asset Management Facilities Management Facilities Management Improved Core Business Focus Redeployment of Capital Reduced Operating Costs Access to World-Class Capabilities Customer Receives Conditioned Air Light Managed Facilities Enron Energy Services

17 17 UB-SMETHODIST $1.2B $3.8B $8.5B $16.0B Enron Energy Services Executed Contracts

18 18 UB-SMETHODIST-0301 Enron Energy Services Executed ContractsStructure Today 1997

19 19 UB-SMETHODIST-0301 EnronOnline – Changing the Way Energy Is Traded Free, Reliable Transaction System with Enron as Principal Transactions per day 11/29/9912/10/99 12/21/99 01/01/00 01/12/0001/23/0002/03/0002/14/0002/25/0003/07/0003/18/0003/29/0004/09/0004/20/0005/01/0005/12/0005/23/0006/03/00 06/14/00 06/25/00 07/06/0007/17/0007/28/0008/08/0008/19/0008/30/0009/10/0009/21/0010/02/00 10/13/00 10/24/0011/04/0011/15/00 11/26/00 12/07/00 01/31/01 02/28/01 Free, Reliable Transaction System with Enron as Principal

20 20 UB-SMETHODIST-0301 EnronOnline Efficiency Gains Marginal Cost Per Transaction (Indexed) Transactions Per Market Maker ,

21 EnronOnline Enron Net Works ® Clickpaper.com Deal Bench CommodityLogic EnronOnline V2.0 Enron Credit

22 22 UB-SMETHODIST-0301 Commitment to Technology 1,380 1,882 $358 $ People Expenditures (Millions) E 1, E $291 New E-commerce Initiatives

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