Enron Corp. - University of California | Office of The President

• Enron's wholesale business led its strong financial results, achieving a record level
of profitability. Enron's retail energy services group also had an outstanding year.
The business showed increasing profitability in each quarter during the year 00
and almost doubled its new outsourcing contracts. Enron broadband services
substantially completed its flexible, scalable broadband network. The business
also gained traction in both of its major businesses, bandwidth intermediation and
content services.
• Enron's wholesale business – its largest operation – continued to grow at a very,
very strong rate. Earnings in this business had grown at a 48% average annual
rate for the past five years and included a 72% increase in year 00. Enron built a
tremendous market franchise that had significant sustainable competitive
advantage.
• The wholesale business had just done great. Enron's wholesale had just a
fantastic quarter and a fantastic year and was looking forward to a great 01.
• Enron was actively transacting in bandwidth intermediation. In the year 00,
Enron completed over 320 bandwidth transactions, including 236 in the 4thQ, up
from 59 transactions in the 3rdQ.
• Enron's other major broadband business was content services. Enron also had a
successful 4thQ where it successfully launched the first phase of its content on
demand product. Enron was delivering movies on demand in select areas of
Seattle, Portland, Salt Lake City and New York. Enron believed that it had a very
unique and powerful commercial proposition with proven technology that created
an enormous opportunity in one of the world's fastest growing markets.
• Enron was pleased with its 4thQ and full year results. Enron had just an
absolutely outstanding year. And an outstanding quarter. Enron was very excited
about the continuing positive business developments across the Company and
remained confident that its strong performance would continue increasing
profitability and expanding returns to shareholders.
• As Enron looked forward to the year 01, the environment looked great. Enron was
feeling very good about things.
• Enron stock was worth at least $126 per share. Enron was forecasting 01 EPS of
$1.70-$1.80 with further growth in 02 to $2.10-$2.20.
283. On 1/22/01, Skilling appeared on CNNfn, was interviewed and stated:
We had a strong quarter .... [I]t was across the board.... It was pretty much
everything.
When asked about the performance of Enron stock, Skilling replied:
- 225 -