AES — what changed in the latest 10-Q

Text added vs the prior filing · source: 10-Q · 2026-05-05

• •the completion of the proposed transaction between AES and Horizon Parent, L.P. (the “Transaction”) on the anticipated terms and timing;

• •the risk that the conditions to the completion of the Transaction, including obtaining required Stockholder and regulatory approvals, are not satisfied in a timely manner or at all;

• •potential litigation relating to the Transaction, including resulting expense or delay, and the effects of any outcomes related thereto;

• •the risk that disruptions from the Transaction will harm AES’ business, including current plans and operations;

• •the ability of AES to retain and hire key personnel through the consummation of the Transaction;

Text removed vs the prior filing · source: 10-Q · 2025-11-04

• Readers are cautioned not to place undue reliance on these forward-looking statements which speak only as of the date of this report. We undertake no obligation to revise any forward-looking statements in order to reflect events or circumstances that may subsequently arise. If we do update one or mo…

• We are a diversified power generation and utility company organized into the following four SBUs, mainly organized by technology: Renewables (solar, wind, energy storage, and hydro), Utilities (AES Indiana, AES Ohio, and AES El Salvador), Energy Infrastructure (natural gas, LNG, coal, pet coke, dies…

• We have two lines of business: generation and utilities. Our Renewables, Utilities, and Energy Infrastructure SBUs participate in our first business line, generation, in which we own and/or operate power plants to generate and sell power to customers, such as utilities, industrial users, and other i…

• Compared with last year, third quarter net income increased $302 million, from $215 million to $517 million. This increase is primarily due to higher income tax benefit mainly driven by tax credit transfers, higher margins from new projects in the Renewables SBU, and an increase in rider revenues du…

• Adjusted EBITDA, a non-GAAP measure, increased $132 million, from $698 million to $830 million, driven by higher contributions from new projects in the Renewables SBU and an increase in rider revenues due to revised rates at AES Indiana and AES Ohio in the Utilities SBU. This was partially offset by…

Text added vs the prior filing · source: 10-Q · 2026-05-05

• AES generally seeks to hedge its exposure to commodity price risk; however, certain generation businesses may retain limited unhedged positions due to short‑term sales structures or contractual mismatches between supply and obligations. As a result, a portion of operating results may be exposed to c…

• Volume variation also affects our commodity exposure. The volume sold under contracts or retail concessions can vary based on weather and economic conditions, resulting in a higher or lower volume of sales in spot markets. Thermal unit availability and hydrology can affect the generation output avai…

• As of March 31, 2026, a hypothetical 10% increase in commodity prices would not be expected to have a material impact on consolidated pre-tax earnings, with estimated impacts of less than a $10 million gain for power, less than a $5 million gain for gas, and less than a $5 million loss for coal. The…

• Commodity price exposure at individual businesses may change over time as contracts mature and hedging positions are adjusted, and although longer-dated forward commodity prices are generally less volatile, our sensitivity to changes in commodity prices may increase in later years due to lower level…

• In the Energy Infrastructure SBU, the generation businesses are largely contracted, but may have residual risk to the extent contracts are not perfectly indexed to the business drivers. This type of market risk exists primarily in California, Chile, the Dominican Republic, and Panama.

Text removed vs the prior filing · source: 10-Q · 2025-11-04

• Although we prefer to hedge our exposure to the impact of market fluctuations in the price of commodities, some of our generation businesses operate under short-term sales, have contracted electricity obligations greater than supply, or operate under contract sales that leave an unhedged exposure on…

• As of September 30, 2025, we project pre-tax earnings exposure on a 10% increase in commodity prices to be less than a $5 million gain for power, less than a $5 million loss for gas, and less than a $5 million loss for coal. The sensitivities are calculated using industry-standard valuation techniqu…

• Exposures at individual businesses will change as new contracts or financial hedges are executed, and our sensitivity to changes in commodity prices generally increases in later years with reduced hedge levels at some of our businesses.

• In the Energy Infrastructure SBU, the generation businesses are largely contracted but may have residual risk to the extent contracts are not perfectly indexed to the business drivers. In California, our Southland once-through cooling generation units (“Legacy Assets”) in Long Beach and Huntington B…

• In the Renewables SBU, our businesses have commodity exposure on unhedged volumes and resource volatility and benefit from higher power prices, where generation exceeds contracted levels. In Colombia, we operate under a shorter-term sales strategy with spot market exposure for uncontracted volumes. …

Text added vs the prior filing · source: 10-Q · 2026-05-05

• There were no changes that occurred during the fiscal quarter covered by this Quarterly Report on Form 10-Q that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Text removed vs the prior filing · source: 10-Q · 2025-11-04

• As previously reported in our Annual Report on Form 10-K for the year ended December 31, 2024, management identified that we did not design effective controls over the review of the disposition of AES Brasil, a complex non-routine transaction; specifically due to the use of incomplete data in the es…

• Notwithstanding the identified material weakness, our CEO and CFO have concluded that our unaudited condensed consolidated financial statements contained in this Quarterly Report on Form 10-Q fairly present, in all material respects, our financial position, results of operations, and cash flows for …

• As of the date of the filing of this Quarterly Report on Form 10-Q, our management has taken significant measures towards remediation of this material weakness. While we have implemented the remediation measures described below, our conclusion on remediation will take place during our annual SOX tes…

• The remediation actions implemented to date include: (i) policy updates detailing steps to perform in an impairment analysis of complex ownership structures, (ii) detailed instructions on considerations to be included in the fair value estimations, (iii) updates to held-for-sale and discontinued ope…

• Following a thorough review, Management determined that the revised controls have been designed effectively. However, the material weakness will not be considered fully remediated until the applicable controls operate for a sufficient period of time and management has concluded, through the testing …

Text added vs the prior filing · source: 10-Q · 2026-05-05

• In October 2019, the Superintendency of the Environment (the "SMA") notified AES Andes of certain alleged breaches associated with the environmental permit of the Ventanas Complex, initiating a sanctioning process through Exempt Resolution N° 1 / ROL D-129-2019. The alleged charges include (i) excee…

• With respect to the sanctioning procedure, AES Andes has submitted a proposed “Compliance Program” (“Programa de Cumplimiento”) to the SMA for the Ventanas Complex. The latest version of this Compliance Program was submitted on May 26, 2021 and approved by the SMA on December 30, 2021. AES Andes has…

• In April 2025, an alleged shareholder of Fluence Energy, Inc. (“Fluence”) filed a putative securities class action in the U.S. District Court for the Eastern District of Virginia (“Court”) against Fluence and certain of Fluence’s officers and directors. The complaint in the case also named the Compa…

• On December 30, 2025, the Company received a complaint filed in Virginia state court by Sinolam LNG Terminal, SA and Sinolam Smarter Energy LNG Power Co. (collectively, “Plaintiffs”) against the Company, AES Latin America, S. de R.L., AES Panama, S.R.L. (“AES Panama”), AES Colon Holding, S. de R.L.,…

• Terminal, S. de R.L., Gas Natural Atlantico S. de R.L., InterEnergy Holdings UK Limited (“IEHL”) (a third party), and Group Energy Gas Panama, S.R.L. (“GEGP”) (a partnership between IEHL and AES Panama) (collectively, “Defendants”). In their complaint, the Plaintiffs allege that the Defendants inter…

Text removed vs the prior filing · source: 10-Q · 2025-11-04

• In October 2019, the Superintendency of the Environment (the "SMA") notified AES Andes of certain alleged breaches associated with the environmental permit of the Ventanas Complex, initiating a sanctioning process through Exempt Resolution N° 1 / ROL D-129-2019. The alleged charges include exceeding…

• the Compliance Program will be considered fully completed, and thus any alleged charges associated with the same will be considered permanently waived. Separately, an ex officio action was brought by the SMA due to alleged exceedances of generation limits, which would require the Company to reduce S…

• In May 2024, the Chilean competition agency (the Fiscalía Nacional Económica or “FNE”) opened an investigation regarding AES Andes’s declarations with respect to coal prices and coal blends used to generate electricity in Chile. The investigation was prompted by two confidential complaints that were…

Text added vs the prior filing · source: 10-Q · 2026-05-05

• You should consider carefully the following updates to risk factors, along with the risk factors disclosed in Item 1A.—Risk Factors of our 2025 Form 10-K and other information contained in or incorporated by reference in this Form 10-Q. Additional risks and uncertainties also may adversely affect ou…

• There is no assurance when or if the Merger will be completed. If our proposed Merger does not close, or is delayed, we may experience financial and operational disruptions. In addition, our stock price may decline if the Merger is perceived as uncertain to close.

• On March 1, 2026, AES entered into the Merger Agreement, by and among the Company, Parent, and Merger Sub. The closing of the Merger is subject to various closing conditions, many of which are not within our full control, including: (1) approval of the shareholders of AES; (2) receipt of all require…

• The Merger is currently expected to close in late 2026 or early 2027, subject to satisfaction or waiver (to the extent permitted by law) of all closing conditions. However, we may be unable to obtain and satisfy, or experience delays in obtaining and satisfying, required regulatory approvals and oth…

• The announcement and pendency of the Merger could adversely affect our business and stock price, including if the Merger does not close or is delayed, for reasons including the following:

Text removed vs the prior filing · source: 10-Q · 2025-11-04

• There have been no material changes to the risk factors disclosed in Item 1A.—Risk Factors of our 2024 Form 10-K. Additional risks and uncertainties also may adversely affect our business and operations, including those discussed in Item 2.—Management's Discussion and Analysis of Financial Condition…