Good day, ladies and gentlemen, and welcome to the Second Quarter 2018 Earnings Release and Teleconference. At this time, all participants are in a listen-only mode. Later, we will conduct the question-and-answer session and instructions will follow at that time. [Operator Instructions] As a reminder, this conference is being recorded. I'd now like to introduce your host today for today's conference, David Borde, Vice President of Investor Relations. You may begin.

Thank you. Good morning and thank you for joining us. We will begin today with comments from Entergy's Chairman and CEO, Leo Denault; and then Drew Marsh, our CFO, will review results. In efforts to accommodate everyone who has questions, we request that each person ask no more than one question and one follow-up. Our planned remarks will be shorter today given our recent Analyst Day and we know you have a busy morning and therefore are scheduled for 45 minutes. In today's call, management will make certain forward-looking statements. Actual results could differ materially from these forward looking statements due to a number of factors which are set forth in our earning's release, our slide presentation and our SEC filings. Entergy does not assume any obligation to update these forward-looking statements. Management will also discuss non-GAAP financial information. Reconciliations to the applicable GAAP measures are included in today's press release and slide presentation, both of which can be found on the Investor Relations section of our website. And, now, I will turn the call over to Leo.

Thank you David and good morning everyone. Given that we are coming off of the Analyst Day, our remarks today will be brief. The main update is that we had a strong quarter and we remain on track with all of our strategic operational and financial objectives. As we stated when we saw you in New York, we have a solid capital plan that is largely ready for execution from a regulatory standpoint, with a demonstrated track record of on-time and on-budged performance. This capital plan will modernize our technology across all functional groups and provide significant value for our customers in service level, sustainability and costs while fueling growth in our business. Additionally, we continue to make significant progress toward transitioning to a pure-play utility as evidenced by our announcement today that we have signed purchase and sale agreements with a subsidiary of Holtec International to sell both Pilgrim and Palisades after their scheduled shutdown. Turning to financial results, we are reporting second quarter Utility, Parent and Other adjusted EPS of a $1.23 and consolidated operational earnings per share of a $1.79. Drew will cover the numbers in more detail, but this quarter's results keep us firmly on track to achieve our full-year guidance and our long-term outlooks. At our businesses, we continue to make good progress achieving our goals. Starting with major projects, in Louisiana, the public service commission approved our agreement to purchase Washington Parish Energy Center. Calpine will construct the 361 MW facility which we expect to purchase in 2021. We also continue to make progress on our four new build generation projects. We discussed those in detail on our Analyst Day, and all projects remain on budget and on schedule. Yesterday, we issued a full notice to proceed on the Montgomery County power station. The…

Thank you, Leo and good morning everyone. As Leo mentioned, our accomplishments this quarter directly support the plans and objectives we reinforced at Analyst Day, in particular results for the quarter were strong and keep us firmly on track to achieve our full-year guidance and longer-term outlooks. While I turn to the results in greater detail, there are two items of note for the quarter that I would like to point out. First, we reached a settlement with the IRS for the 2012 and 2013 tax years. This is a positive outcome and generated an earnings benefit of $0.31. Second, as Leo mentioned, our customers started to see benefits from $278 million of unprotected excess ADIT related to tax reform. As a result, the net revenue and income tax lines are complex, and I will continue until customers have received the full benefit of the return. Remember these entries offset each other dollar-to-dollar, so there is no bottom line earnings impact. Beyond the accounting, I want to point out that within six months of the enactment of tax reforms; we achieved sufficient clarity around implementation such that our customers are already receiving significant benefit. This accomplishment is a direct result of efforts with our retail regulators to meet our customers' expectation. Now turning to results on Slide 4, operational earnings for Entergy Consolidated were a $1.32 lower than second quarter 2017. You will recall that last year's results reflected approximately $2 of income tax benefit at EWC. This year's results include $0.31 of income tax benefit, $0.24 of which is at new P&L. This is the result of the 2012 and 2013 IRS Audit I mentioned a moment ago. Breaking down the results starting with Utility, Parent and Others on Slide 5, adjusted earnings were $0.11 higher than the prior…

[Operator Instructions] And our first question comes from the line of Shar Pourezza from Guggenheim & Partners. Your line is now open.

Good morning, guys. So, congrats on the Pilgrim and Palisades decom sales, just one question mainly about Indian Point, anything to read into the fact that Indian Point wasn't sort of part of this package deal, is there sort of some logistical challenges that are pertinent to Indian Point, so how we should think about the last remaining asset that you guys own?

There is no challenge associated with that Shar. It's really a function of, if you recall, at up until a little while ago, Palisades was going to be the first plant that we will close. Since that didn't come to fruition we continued on the path of the package deal with Pilgrim and Palisades because they were originally the first after VY, the nest two in line. So, nothing to read into it. I think the only thing to read in is that, as we have mentioned before there is a developing market for this kind of activity as we-- and as you have seen others started after decommissioning these plants.

Thank you. And our next question comes from the line of Praful Mehta from Citi. Your line is now open.

Hi, guys. Thanks. So, again congrats on Pilgrim and Palisades, just any more color you can provide in terms of the price-- have you provided some terms which-- wanted to get a little bit color around the transaction and what are the-- what are the challenge is you think in terms of approvals?

Sure, Praful. It's Drew. In terms of the price, I think what we said it was a nominal amount which I mean, I think that probably means that you could afford it if you can demonstrate the capability to decommission a nuclear plant, but it's not a lot of money, and so the main objective for us, of course is to move the risk to a party that is capable of doing it and doing it much quicker than we can. And that will benefit our communities and/or other stakeholders much better. So, I think that's the main point of that.

Got you. And from an approval process perspective, you would see a similar path that you went down with VY as an NRC kind of the key driver or do you see other kind of approvals that may take longer here in these transactions?

Sure. From an approval perspective, it's really just the NRC in this case, and we don't see specific state regulatory role right now.

Got you. Thanks. And then finally as you continue to make this successful transition to the pure-play utility story, wanted to understand, again strategically, if there is anything else we should be thinking about, as you step back and look at the path going forward, is there anything in terms of utility growth or in terms of your own portfolio optimization, anything you should be thinking about as you look at the utility story going forward?

I think it's all the same-- the same story that we were telling you-- a little over a month ago in Analyst Day, we continue to see robust capital plan at the Utility. We continue to see the mechanism that we have in place that currently match up with that plan and your changes around the edges to a regulatory constructs to match new types of investments as we go forward. So really, this has given us between all the things Drew mentioned in terms of the hedging and the operations, the sales of these facilities gives us a lot of capacity financially, operationally, management, bandwidth et cetera to really focus on the growth of the utility and the benefits that our customers will see through those types of investments, whether those are the new generating plants that we are building, the renewals that we are putting in place, AMI and whatever comes after that. So, really, just a big focus on making investments that fuel the growth of the business, but as you can see we continue to be one of the lowest priced options as far as the provision of electricity in United States, and we are trying to hold on to that while we grow the bus rapidly.

Thank you. And our next question comes from the line of Nicholas Campanella from Bank of America. Your line is now open.

Hey, good morning. Congrats on the recent announcements. Just keeping up with the EWC business quick, can you give any additional color on how to think about the cash flow impact for the agreement? I am specifically thinking about kind of the NRC minimum site costs required versus the NDT balances that you disclosed in your slides?

This is Drew. So, on an overall cash flow basis, like I said in my remarks our expectations from EWC is that we would have positive net cash flow back to the parent through 2022. That's still the case, and as it relates to NDT expectations, we do not expect to-- have to contribute any more funds to those NDTs prior to transaction for Pilgrim and Palisades.

Thanks. Just switching to UP&O quick, I know that there has been higher authorized asks at Arkansas specifically, in the 5% to 7% forecast for UP&O how do you kind of think about the high-end versus the low-end of the forecast and your assumptions for equity layers? If we kept equity layers kind of flat through the period, where would that put within your guidance range?

Well, our expectation is-- and we have talked about this a little bit on Analyst Day is that we would have to see the equity layers at the utility grow a little bit over time and so we are getting around 49% over the next few years. So, if you-- I don't have forecast that would say we keep it flat. If we did that, I think it would obviously change things a little bit; it would lower our current debt for sure, and so that would be helpful from a parent-debt perspective, but I think overall it might be slightly negative. But the-- our objective is to raise our equity layer on utilities over the next few years.

Thank you and our next question comes from the line of Paul Fremont from Mizuho. Your line is now open.

Thanks. So with agreements in place for three of the nukes and also a significant amount of hedging through everybody's remaining life, can you just give us a sense of what the cash flow associated with those three units is going to look like through 2022?

That the - you are talking about Pilgrim, Palisades and Indian point?

Well Pilgrim, Palisades and I guess Vermont Yankee, right because--

Okay, you are talking about--

Because, Indian Point still isn't resolved, right?

Right. So Vermont Yankee, of course is in decommissioning now, and its funds are primarily coming from the trust, and hopefully we will close by the end of the year, which is our expectation. And then those cash flows - there wouldn't be any significant cash flow on an ongoing basis in that regard for decommissioning there. The Pilgrim and Palisades are really no different from what we were showing before. I guess they're from a cash flow perspective once Pilgrim was going to close. Again those dollars in our forecasts we're going to be coming from the decommissioning trust, as well as Palisades. But Palisades was pretty much at the very end of our forecasts that we showed you at Analyst Day. So net --net, our cash flow forecasts overall for EWC which includes our expectations for shutting down those plants, and then completing the sales of them is positive net cash back parent through 2022.

So is it fair to assume that for Pilgrim and Palisades, its likely sort of a negative cash flow profile that's offset by the contract revenue that's coming in from Indian Point?

I'm not sure. There's isn't contract revenue at Indian Point. There is one at Palisades.

I'm sorry the hedge --in other words, the hedge run is still coming in -

Yes. Palisades is our most cash flow positive plant to be sure during the contracted period. On a merchant basis of course that's a different question. But you there is positive cash flow at Palisades through 2022.

Thank you. And that concludes our question-and-answer session for today. I'd like to turn the call back over to David Borde for closing remarks.

Thank you, Glenda and thanks to everyone for participating this morning. Our Annual Report on Form 10-Q is due to the SEC on August 9 and provides more details and disclosures about our financial statements. Events that occur prior to the date of our 10-Q filing that provide additional evidence of conditions that existed at the date of the balance sheet would be reflected in our financial statements in accordance with generally accepted accounting principles. Also, as a remainder we maintain a web page as part of Entergy's investor relations website called regulatory and other information, which provides key updates of regulatory proceedings and important milestones on our strategic execution. While some of this information may be considered material information we should rely exclusively on this page for all relevant company information. And this concludes our call. Thank you very much.

Ladies and gentlemen, thank you for your participation in today's conference. This concludes the program. And you may now disconnect. Everyone have a great day.