Company: EAI
Filing Date: 2025-08-01
Form Type: 10-Q
Source: 0000065984-25-000087
Chunk: 227

Company: ENTERGY ARKANSAS, LLC
Filing Date: 2025-08-01
Form: 10-Q
Item: Item 7
Chunk 227
---
%)(0.2%)Debt to capital, excluding securitization bonds (non-GAAP) (a)64.7%65.1%Effect of subtracting cash(0.9%)(0.7%)Net debt to net capital, excluding securitization bonds (non-GAAP) (a)63.8%64.4%

(a)Calculation excludes the Texas securitization bonds, which are non-recourse to Entergy Texas.

As of June 30, 2025, 18.6% of the debt outstanding is at the parent company, Entergy Corporation, and 81.4% is at the Utility segment.  Net debt consists of debt less cash and cash equivalents.  Debt consists of notes payable and commercial paper, finance lease obligations, and long-term debt, including the currently maturing portion.  Capital consists of debt, equity, and subsidiaries’ preferred stock without sinking fund.  Net capital consists of capital less cash and cash equivalents.  The debt to capital ratio excluding securitization bonds and net debt to net capital ratio excluding securitization bonds are non-GAAP measures.  Entergy uses the debt to capital ratios excluding securitization bonds in analyzing its financial condition and believes they provide useful information to its investors and creditors in evaluating Entergy’s financial condition because the securitization bonds are non-recourse to Entergy, as more fully described in Note 5 to the financial statements in the Form 10-K.  Entergy also uses the net debt to net capital ratio excluding securitization bonds in analyzing its financial condition and believes it provides useful information to its investors and creditors in evaluating Entergy’s financial condition because net debt indicates Entergy’s outstanding debt position that could not be readily satisfied by cash and cash equivalents on hand.

Entergy Corporation has in place a credit facility that has a borrowing capacity of $3 billion and expires in June 2030.  The facility includes fronting commitments for the issuance of letters of credit against $20 million of the total borrowing capacity of the credit facility.  The commitment fee is currently 0.225% of the undrawn commitment amount.  Commitment fees and interest rates on loans under the credit facility can fluctuate depending on the senior unsecured debt ratings of Entergy Corporation.  As there were no borrowings under the facility for the six months ended June 30, 2025, the estimated interest rate