Edgar Filing: UNION ELECTRIC CO

Ameren Consolidated 10-Q - 6-30-2006

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(X) Quarterly report pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

for the Quarterly Period Ended June 30, 2006

( ) Transition report pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

for the transition period from ____ to____.

Commission File Number	Exact name of registrant as specified in its charter; State of Incorporation; Address and Telephone Number	IRS Employer Identification No.

1-14756	Ameren Corporation	43-1723446
	(Missouri Corporation)
	1901 Chouteau Avenue
	St. Louis, Missouri 63103
	(314) 621-3222

1-2967	Union Electric Company	43-0559760
	(Missouri Corporation)
	1901 Chouteau Avenue
	St. Louis, Missouri 63103
	(314) 621-3222

1-3672	Central Illinois Public Service Company	37-0211380
	(Illinois Corporation)
	607 East Adams Street
	Springfield, Illinois 62739
	(217) 523-3600

333-56594	Ameren Energy Generating Company	37-1395586
	(Illinois Corporation)
	1901 Chouteau Avenue
	St. Louis, Missouri 63103
	(314) 621-3222

2-95569	CILCORP Inc.	37-1169387
	(Illinois Corporation)
	300 Liberty Street
	Peoria, Illinois 61602
	(309) 677-5271

1-2732	Central Illinois Light Company	37-0211050
	(Illinois Corporation)
	300 Liberty Street
	Peoria, Illinois 61602
	(309) 677-5271

1-3004	Illinois Power Company	37-0344645
	(Illinois Corporation)
	370 South Main Street
	Decatur, Illinois 62523
	(217) 424-6600

Indicate by check mark whether the registrants: (1) have filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) have been subject to such filing require-ments for the past 90 days. Yes (X) No ( )

Indicate by check mark whether each registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definitions of accelerated filer and large accelerated filer in Rule 12b-2 of the Securities Exchange Act of 1934.

	Large Accelerated Filer	Accelerated Filer	Non-Accelerated Filer
Ameren Corporation	(X)	( )	( )
Union Electric Company	( )	( )	(X)
Central Illinois Public Service Company	( )	( )	(X)
Ameren Energy Generating Company	( )	( )	(X)
CILCORP Inc.	( )	( )	(X)
Central Illinois Light Company	( )	( )	(X)
Illinois Power Company	( )	( )	(X)

Indicate by check mark whether each registrant is a shell company (as defined in Rule 12b-2 of the Securities Exchange Act of 1934).

Ameren Corporation	Yes	( )	No	(X)
Union Electric Company	Yes	( )	No	(X)
Central Illinois Public Service Company	Yes	( )	No	(X)
Ameren Energy Generating Company	Yes	( )	No	(X)
CILCORP Inc.	Yes	( )	No	(X)
Central Illinois Light Company	Yes	( )	No	(X)
Illinois Power Company	Yes	( )	No	(X)

The number of shares outstanding of each registrant’s classes of common stock as of July 31, 2006, was as follows:

Ameren Corporation	Common stock, $.01 par value per share - 205,866,928

Union Electric Company	Common stock, $5 par value per share, held by Ameren Corporation (parent company of the registrant) - 102,123,834

Central Illinois Public Service Company	Common stock, no par value, held by Ameren Corporation (parent company of the registrant) - 25,452,373

Ameren Energy Generating Company	Common stock, no par value, held by Ameren Energy Development Company (parent company of the registrant and indirect subsidiary of Ameren Corporation) - 2,000

CILCORP Inc.	Common stock, no par value, held by Ameren Corporation (parent company of the registrant) - 1,000

Central Illinois Light Company	Common stock, no par value, held by CILCORP Inc. (parent company of the registrant and subsidiary of Ameren Corporation) - 13,563,871

Illinois Power Company	Common stock, no par value, held by Ameren Corporation (parent company of the registrant) - 23,000,000

OMISSION OF CERTAIN INFORMATION

Ameren Energy Generating Company and CILCORP Inc. meet the conditions set forth in General Instruction H(1)(a) and (b) of Form 10-Q and are therefore filing this form with the reduced disclosure format allowed under that General Instruction.

This combined Form 10-Q is separately filed by Ameren Corporation, Union Electric Company, Central Illinois Public Service Company, Ameren Energy Generating Company, CILCORP Inc., Central Illinois Light Company, and Illinois Power Company. Each registrant hereto is filing on its own behalf all of the information contained in this quarterly report that relates to such registrant. Each registrant hereto is not filing any information that does not relate to such registrant, and therefore makes no representation as to any such information.

TABLE OF CONTENTS

	Page
Glossary of Terms and Abbreviations.............................................................................................................................................................................................................................................	5

Forward-looking Statements.............................................................................................................................................................................................................................................................	6

PART I Financial Information

Item 1. Financial Statements (Unaudited)
Ameren Corporation
Consolidated Statement of Income......................................................................................................................................................................................................................	8
Consolidated Balance Sheet.................................................................................................................................................................................................................................	9
Consolidated Statement of Cash Flows..............................................................................................................................................................................................................	10
Union Electric Company
Consolidated Statement of Income......................................................................................................................................................................................................................	11
Consolidated Balance Sheet.................................................................................................................................................................................................................................	12
Consolidated Statement of Cash Flows..............................................................................................................................................................................................................	13
Central Illinois Public Service Company
Statement of Income...............................................................................................................................................................................................................................................	14
Balance Sheet..........................................................................................................................................................................................................................................................	15
Statement of Cash Flows.......................................................................................................................................................................................................................................	16
Ameren Energy Generating Company
Consolidated Statement of Income......................................................................................................................................................................................................................	17
Consolidated Balance Sheet.................................................................................................................................................................................................................................	18
Consolidated Statement of Cash Flows..............................................................................................................................................................................................................	19
CILCORP Inc.
Consolidated Statement of Income......................................................................................................................................................................................................................	20
Consolidated Balance Sheet.................................................................................................................................................................................................................................	21
Consolidated Statement of Cash Flows..............................................................................................................................................................................................................	22
Central Illinois Light Company
Consolidated Statement of Income......................................................................................................................................................................................................................	23
Consolidated Balance Sheet.................................................................................................................................................................................................................................	24
Consolidated Statement of Cash Flows..............................................................................................................................................................................................................	25
Illinois Power Company
Consolidated Statement of Income......................................................................................................................................................................................................................	26
Consolidated Balance Sheet.................................................................................................................................................................................................................................	27
Consolidated Statement of Cash Flows..............................................................................................................................................................................................................	28

Combined Notes to Financial Statements...................................................................................................................................................................................................................	29

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations...........................................................................................................................	53
Item 3. Quantitative and Qualitative Disclosures About Market Risk................................................................................................................................................................................	72
Item 4. Controls and Procedures...............................................................................................................................................................................................................................................	75

PART II Other Information

Item 1. Legal Proceedings...........................................................................................................................................................................................................................................................	75
Item 1A Risk Factors.....................................................................................................................................................................................................................................................................	75
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.................................................................................................................................................................................	77
Item 4. Submission of Matters to a Vote of Security Holders...............................................................................................................................................................................................	78
Item 6. Exhibits.............................................................................................................................................................................................................................................................................	79

Signatures............................................................................................................................................................................................................................................................................................	81

This Form 10-Q contains “forward-looking” statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements are all statements other than statements of historical fact, including those statements that are identified by the use of the words “anticipates,” “estimates,” “expects,” “intends,” “plans,” “predicts,” “projects,” and similar expressions. Forward-looking statements should be read with the cautionary statements and important factors included on page 6 of this Form 10-Q under the heading “Forward-looking Statements.”

GLOSSARY OF TERMS AND ABBREVIATIONS

We use the words “our,” “we” or “us” with respect to certain information that relates to all Ameren Companies, as defined below. When appropriate, subsidiaries of Ameren are named specifically as we discuss their various business activities.

AERG - AmerenEnergy Resources Generating Company, a CILCO subsidiary that operates a non-rate-regulated electric generation business in Illinois.

AFS - Ameren Energy Fuels and Services Company, a Development Company subsidiary that procures fuel and natural gas and manages the related risks for the Ameren Companies.

Ameren - Ameren Corporation and its subsidiaries on a consolidated basis. In references to financing activities, acquisition activities, or liquidity arrangements, Ameren is defined as Ameren Corporation, the parent.

Ameren Companies - The individual registrants within the Ameren consolidated group.

Ameren Energy - Ameren Energy, Inc., an Ameren Corporation subsidiary that serves as a power marketing and risk management agent for UE and Genco primarily for transactions of less than one year.

Ameren Services - Ameren Services Company, an Ameren Corporation subsidiary that provides support services to Ameren and its subsidiaries.

APB - Accounting Principles Board.

ARO - Asset retirement obligations.

Baseload - The minimum amount of electric power delivered or required over a given period of time at a steady rate.

Capacity factor - A percentage measure that indicates how much of an electric power generating unit’s capacity was used during a specific period.

CILCO - Central Illinois Light Company, a CILCORP subsidiary that operates a rate-regulated electric transmission and distribution business, a primarily non-rate-regulated electric generation business through AERG, and a rate-regulated natural gas transmission and distribution business, all in Illinois, as AmerenCILCO. CILCO owns all of the common stock of AERG.

CILCORP - CILCORP Inc., an Ameren Corporation subsidiary that operates as a holding company for CILCO and various non-rate-regulated subsidiaries.

CIPS - Central Illinois Public Service Company, an Ameren Corporation subsidiary that operates a rate-regulated electric and natural gas transmission and distribution business in Illinois as AmerenCIPS.

Cooling degree-days - The summation of positive differences between the mean daily temperature and a 65-degree Fahrenheit base. The statistic is useful as an indicator of demand for electricity for summer space cooling for residential and commercial customers.

CT - Combustion turbine electric generation equipment used primarily for peaking capacity.

CUB - Citizens Utility Board.

Development Company - Ameren Energy Development Company, a Resources Company subsidiary and Genco parent, which primarily develops and constructs generating facilities for Genco.

DOE - Department of Energy, a U.S. government agency.

DRPlus - Ameren Corporation’s dividend reinvestment and direct stock purchase plan.

Dynegy - Dynegy Inc.

EEI - Electric Energy, Inc., an 80%-owned Ameren Corporation subsidiary (40% owned by UE and 40% owned by Development Company) that operates electric generation and transmission facilities in Illinois. The remaining 20% is owned by Kentucky Utilities Company.

ELPC - Environmental Law and Policy Center.

EPA - Environmental Protection Agency, a U.S. government agency.

Equivalent availability factor - A measure that indicates the percentage of time an electric power generating unit was available for service during a specific period.

ERISA - Employee Retirement Income Security Act of 1974, as amended.

Exchange Act - Securities Exchange Act of 1934, as amended.

FASB - Financial Accounting Standards Board, a rulemaking organization that establishes financial accounting and reporting standards in the United States.

FERC - The Federal Energy Regulatory Commission, a U.S. government agency.

FIN - FASB Interpretation Number. A FIN statement is an explanation intended to clarify accounting pronouncements previously issued by the FASB.

GAAP - Generally accepted accounting principles in the United States.

Genco - Ameren Energy Generating Company, a Development Company subsidiary that operates a non-rate-regulated electric generation business in Illinois and Missouri.

Gigawatthour - One thousand megawatthours.

Heating degree-days - The summation of negative differences between the mean daily temperature and a 65- degree Fahrenheit base. This statistic is useful as an indicator of demand for electricity and natural gas for winter space heating for residential and commercial customers.

ICC - Illinois Commerce Commission, a state agency that regulates the Illinois utility businesses and operations of CIPS, CILCO, and IP.

Illinois Customer Choice Law - Illinois Electric Service Customer Choice and Rate Relief Law of 1997, which provided for electric utility restructuring and introduced competition into the retail supply of electric energy in Illinois.

Illinois EPA - Illinois Environmental Protection Agency, a state government agency.

IP - Illinois Power Company, an Ameren Corporation subsidiary that was acquired from Dynegy on September 30,

2004. IP operates a rate-regulated electric and natural gas transmission and distribution business in Illinois as AmerenIP.

IP SPT - Illinois Power Special Purpose Trust, which was created as a subsidiary of Illinois Power Securitization Limited Liability Company to issue TFNs as allowed under the Illinois Customer Choice Law. Pursuant to FIN 46R, IP SPT is a variable-interest entity, as the equity investment is not sufficient to permit IP SPT to finance its activities without additional subordinated debt.

JDA - The joint dispatch agreement among UE, CIPS, and Genco under which UE and Genco jointly dispatch electric generation.

Kilowatthour - A measure of electricity consumption equivalent to the use of 1,000 watts of power over a period of one hour.

Marketing Company - Ameren Energy Marketing Company, a Development Company subsidiary that markets power, primarily for periods over one year.

Medina Valley - AmerenEnergy Medina Valley Cogen (No. 4) LLC and its subsidiaries, which are all Development Company subsidiaries, which indirectly own a 40-megawatt gas-fired electric generation plant.

Megawatthour - One thousand kilowatthours.

MGP - Manufactured gas plant.

MISO - Midwest Independent Transmission System Operator, Inc.

MISO Day Two Energy Market - A market that began operating on April 1, 2005. It uses market-based pricing, incorporating transmission congestion and line losses, to compensate market participants for power. The previous system required generators to make advance reservations for transmission service.

Money pool - Borrowing agreements among Ameren and its subsidiaries to coordinate and provide for certain short-term cash and working capital requirements. Separate money pools are maintained between rate-regulated and non-rate-regulated businesses. These are referred to as the utility money pool and the non-state-regulated subsidiary money pool, respectively.

Moody’s - Moody’s Investors Service Inc., a credit rating agency.

MoPSC - Missouri Public Service Commission, a state agency that regulates the Missouri utility business and operations of UE.

NO_x - Nitrogen oxide.

Noranda - Noranda Aluminum, Inc.

NYMEX - New York Mercantile Exchange.

OCI - Other comprehensive income (loss) as defined by GAAP.

PUHCA 1935 - The Public Utility Holding Company Act of 1935, which was repealed, effective February 8, 2006, by the Energy Policy Act of 2005 that was enacted on August 8, 2005.

PUHCA 2005 - The Public Utility Holding Company Act of 2005, that was enacted as part of the Energy Policy Act of 2005, effective February 8, 2006.

Resources Company - Ameren Energy Resources Company, an Ameren Corporation subsidiary that consists of non-rate-regulated operations, including Development Company, Genco, Marketing Company, AFS, and Medina Valley.

S&P - Standard & Poor’s Ratings Services, a credit rating agency that is a division of The McGraw Hill Companies, Inc.

SEC - Securities and Exchange Commission, a U.S. government agency.

SFAS - Statement of Financial Accounting Standards, the accounting and financial reporting rules issued by the FASB.

SO₂- Sulfur dioxide.

TFN - Transitional Funding Trust Notes issued by IP SPT as allowed under Illinois’ deregulation legislation. IP must designate a portion of cash received from customer billings to pay the TFNs. The proceeds received by IP are remitted to IP SPT. The proceeds are restricted for the sole purpose of making payments of principal and interest on, and paying other fees and expenses related to, the TFNs.

UE - Union Electric Company, an Ameren Corporation subsidiary that operates a rate-regulated electric generation, transmission and distribution business, and a rate-regulated natural gas transmission and distribution business in Missouri, as AmerenUE.

_________________________________________________

FORWARD-LOOKING STATEMENTS

Statements in this report not based on historical facts are considered “forward-looking” and, accordingly, involve risks and uncertainties that could cause actual results to differ materially from those discussed. Although such forward-looking statements have been made in good faith and are based on reasonable assumptions, there is no assurance that the expected results will be achieved. These statements include (without limitation) statements as to future expectations, beliefs, plans, strategies, objectives, events, conditions, and financial performance. In connection with the “safe harbor” provi-sions of the Private Securities Litigation Reform Act of 1995, we are providing this cautionary statement to identify important factors that could cause actual results to differ materially from those anticipated. The following factors, in addition to those discussed elsewhere in this report and in our other filings with the SEC, could cause actual results to differ materially from management expectations suggested in such forward-looking statements:

·	regulatory or legislative actions, including changes in regulatory policies and ratemaking determinations, such as the outcome of UE, CIPS, CILCO and IP rate proceedings;

·	the impact of the termination of the joint dispatch agreement among UE, CIPS, and Genco;

·	changes in laws and other governmental actions, including monetary and fiscal policies;

the effects of increased competition in the future due to, among other things, deregulation of certain aspects of our business at both the state and federal levels, and the implementation of deregulation, such as when the current electric rate freeze and current power supply contracts expire in Illinois at the end of 2006;

·	the effects of participation in the MISO;

the availability of fuel such as coal, natural gas and enriched uranium used to produce electricity; the availability of purchased power and natural gas for distribution; and the level and volatility of future market prices for such commodities, including the ability to recover the costs for such commodities;

·	the effectiveness of our risk management strategies and the use of financial and derivative instruments;

·	prices for power in the Midwest;

·	business and economic conditions, including their impact on interest rates;

·	disruptions of the capital markets or other events that make the Ameren Companies’ access to necessary capital more difficult or costly;

·	the impact of the adoption of new accounting standards and the application of appropriate technical accounting rules and guidance;

·	actions of credit rating agencies and the effects of such actions;

·	weather conditions and other natural phenomena;

·	the impact of system outages caused by severe weather conditions or other events;

·	generation plant construction, installation and performance, including costs associated with UE’s Taum Sauk pumped-storage hydroelectric plant incident and its future operation;

·	operation of UE’s nuclear power facility, including planned and unplanned outages, and decommissioning costs;

·	the effects of strategic initiatives, including acquisitions and divestitures;

·	the impact of current environmental regulations on utilities and power generating companies and the expectation that more stringent requirements will be introduced over time, which could have a negative financial effect;

·	labor disputes and future wage and employee benefits costs, including changes in returns on benefit plan assets;

·	changes in the energy markets, environmental laws or regulations, interest rates, or other factors that could adversely affect assumptions in connection with the IP acquisition;

·	the impact of conditions imposed by regulators in connection with their approval of Ameren’s acquisition of IP;

·	the inability of our counterparties to meet their obligations with respect to contracts and financial instruments;

·	the cost and availability of transmission capacity for the energy generated by the Ameren Companies’ facilities or required to satisfy energy sales made by the Ameren Companies;

·	legal and administrative proceedings; and

·	acts of sabotage, war, terrorism or intentionally disruptive acts.

Given these uncertainties, undue reliance should not be placed on these forward-looking statements. Except to the extent required by the federal securities laws, we undertake no obligation to publicly update or revise any forward-looking statements to reflect new information or future events.

AMEREN CORPORATION
CONSOLIDATED STATEMENT OF INCOME
(Unaudited) (In millions, except per share amounts)

	Three Months Ended June 30,						Six Months Ended June 30,
		2006			2005			2006			2005
Operating Revenues:
Electric	$	1,378		$	1,407		$	2,589		$	2,529
Gas		172			174			761			670
Other		-			3			-			4
Total operating revenues		1,550			1,584			3,350			3,203

Operating Expenses:
Fuel and purchased power		524			485			1,049			894
Gas purchased for resale		104			106			557			460
Other operations and maintenance		394			375			742			720
Depreciation and amortization		162			157			327			314
Taxes other than income taxes		90			95			203			186
Total operating expenses		1,274			1,218			2,878			2,574

Operating Income		276			366			472			629

Other Income and Expenses:
Miscellaneous income		4			6			8			13
Miscellaneous expense		(1	)		(6	)		(1	)		(7	)
Total other income		3			-			7			6

Interest Charges		80			77			156			151

Income Before Income Taxes, Minority Interest
and Preferred Dividends of Subsidiaries		199			289			323			484

Income Taxes		68			100			112			171

Income Before Minority Interest and Preferred
Dividends of Subsidiaries		131			189			211			313

Minority Interest and Preferred Dividends
of Subsidiaries		(8	)		(4	)		(18	)		(7	)

Net Income	$	123		$	185		$	193		$	306

Earnings per Common Share – Basic and Diluted	$	0.60		$	0.93		$	0.94		$	1.55
Dividends per Common Share	$	0.635		$	0.635		$	1.27		$	1.27
Average Common Shares Outstanding		205.4			199.7			205.1			197.5

The accompanying notes are an integral part of these consolidated financial statements.

AMEREN CORPORATION
CONSOLIDATED BALANCE SHEET
(Unaudited) (In millions, except per share amounts)

	June 30,			December 31,
	2006			2005
ASSETS
Current Assets:
Cash and cash equivalents	$	51		$	96
Accounts receivable – trade (less allowance for doubtful
accounts of $25 and $22, respectively)		409			552
Unbilled revenue		355			382
Miscellaneous accounts and notes receivable		71			31
Materials and supplies		549			572
Other current assets		110			185
Total current assets		1,545			1,818
Property and Plant, Net		13,920			13,572
Investments and Other Assets:
Investments in leveraged leases		32			50
Nuclear decommissioning trust fund		257			250
Goodwill		976			976
Intangible assets		250			246
Other assets		643			419
Regulatory assets		827			831
Total investments and other assets		2,985			2,772
TOTAL ASSETS	$	18,450		$	18,162

LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Current maturities of long-term debt	$	124		$	96
Short-term debt		397			193
Accounts and wages payable		404			706
Taxes accrued		97			131
Other current liabilities		386			361
Total current liabilities		1,408			1,487
Long-term Debt, Net		5,705			5,354
Preferred Stock of Subsidiary Subject to Mandatory Redemption		19			19
Deferred Credits and Other Liabilities:
Accumulated deferred income taxes, net		1,958			1,969
Accumulated deferred investment tax credits		123			129
Regulatory liabilities		1,173			1,132
Asset retirement obligations		531			518
Accrued pension and other postretirement benefits		800			760
Other deferred credits and liabilities		174			218
Total deferred credits and other liabilities		4,759			4,726
Preferred Stock of Subsidiaries Not Subject to Mandatory Redemption		195			195
Minority Interest in Consolidated Subsidiaries		15			17
Commitments and Contingencies (Notes 2, 8 and 9)
Stockholders' Equity:
Common stock, $.01 par value, 400.0 shares authorized,
205.8 and 204.7 shares outstanding, respectively		2			2
Other paid-in capital, principally premium on common stock		4,457			4,399
Retained earnings		1,932			1,999
Accumulated other comprehensive loss		(36	)		(24	)
Other		(6	)		(12	)
Total stockholders’ equity		6,349			6,364
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	18,450		$	18,162

The accompanying notes are an integral part of these consolidated financial statements.

AMEREN CORPORATION
CONSOLIDATED STATEMENT OF CASH FLOWS
(Unaudited) (In millions)

		Six Months Ended
		June 30,
		2006			2005
Cash Flows From Operating Activities:
Net income	$	193		$	306
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization		340			299
Amortization of nuclear fuel		16			17
Amortization of debt issuance costs and premium/discounts		7			7
Deferred income taxes and investment tax credits, net		(19	)		66
Loss on sale of leveraged leases		4			-
Minority interest		12			1
Other		1			-
Changes in assets and liabilities, excluding the effects of acquisitions:
Receivables, net		168			(8	)
Materials and supplies		25			46
Accounts and wages payable		(258	)		(163	)
Taxes accrued		(33	)		112
Assets, other		58			11
Liabilities, other		10			1
Pension and other postretirement benefit obligations, net		46			54
Net cash provided by operating activities		570			749

Cash Flows From Investing Activities:
Capital expenditures		(406	)		(442	)
CT acquisitions		(292	)		-
Nuclear fuel expenditures		(25	)		(13	)
Proceeds from sale of leveraged leases		11			-
Purchases of emission allowances		(38	)		(92	)
Sales of emission allowances		4			4
Other		-			12
Net cash used in investing activities		(746	)		(531	)

Cash Flows From Financing Activities:
Dividends on common stock		(260	)		(253	)
Capital issuance costs		(2	)		(1	)
Short-term debt, net		204			(256	)
Dividends paid to minority interest		(14	)		-
Redemptions, repurchases, and maturities:
Long-term debt		(86	)		(237	)
Issuances:
Common stock		57			402
Long-term debt		232			85
Net cash provided by (used in) financing activities		131			(260	)

Net change in cash and cash equivalents		(45	)		(42	)
Cash and cash equivalents at beginning of year		96			69
Cash and cash equivalents at end of period	$	51		$	27

The accompanying notes are an integral part of these consolidated financial statements.

UNION ELECTRIC COMPANY
CONSOLIDATED STATEMENT OF INCOME
(Unaudited) (In millions)

	Three Months Ended June 30,						Six Months Ended June 30,
		2006			2005			2006			2005
Operating Revenues:
Electric	$	687		$	726		$	1,254		$	1,259
Gas		22			26			91			101
Other		1			-			1			-
Total operating revenues		710			752			1,346			1,360

Operating Expenses:
Fuel and purchased power		192			182			384			326
Gas purchased for resale		12			13			56			58
Other operations and maintenance		196			193			367			374
Depreciation and amortization		81			76			161			152
Taxes other than income taxes		59			59			118			114
Total operating expenses		540			523			1,086			1,024

Operating Income		170			229			260			336

Other Income and Expenses:
Miscellaneous income		1			2			4			9
Miscellaneous expense		(2	)		(2	)		(4	)		(4	)
Total other income (expense)		(1	)		-			-			5

Interest Charges		37			27			72			52

Income Before Income Taxes and Equity
in Income of Unconsolidated Investment		132			202			188			289

Income Taxes		50			71			69			102

Income Before Equity in Income
of Unconsolidated Investment		82			131			119			187

Equity in Income of Unconsolidated Investment		10			1			24			2

Net Income		92			132			143			189

Preferred Stock Dividends		2			2			3			3

Net Income Available to Common Stockholder	$	90		$	130		$	140		$	186

The accompanying notes as they relate to UE are an integral part of these consolidated financial statements

UNION ELECTRIC COMPANY
CONSOLIDATED BALANCE SHEET
(Unaudited) (In millions, except per share amounts)

	June 30,			December 31,
	2006			2005
ASSETS
Current Assets:
Cash and cash equivalents	$	1		$	20
Accounts receivable – trade (less allowance for doubtful
accounts of $6 and $6, respectively)		141			190
Unbilled revenue		176			133
Miscellaneous accounts and notes receivable		58			7
Accounts receivable – affiliates		26			53
Current portion of intercompany note receivable – CIPS		-			6
Materials and supplies		214			199
Other current assets		49			57
Total current assets		665			665
Property and Plant, Net		7,696			7,379
Investments and Other Assets:
Nuclear decommissioning trust fund		257			250
Intercompany note receivable – CIPS		-			61
Intangible assets		63			63
Other assets		496			269
Regulatory assets		583			590
Total investments and other assets		1,399			1,233
TOTAL ASSETS	$	9,760		$	9,277

LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Current maturities of long-term debt	$	11		$	4
Short-term debt		364			80
Accounts and wages payable		90			274
Accounts and wages payable – affiliates		83			134
Taxes accrued		113			59
Other current liabilities		148			96
Total current liabilities		809			647
Long-term Debt, Net		2,931			2,698
Deferred Credits and Other Liabilities:
Accumulated deferred income taxes, net		1,293			1,277
Accumulated deferred investment tax credits		92			96
Regulatory liabilities		811			802
Asset retirement obligations		478			466
Accrued pension and other postretirement benefits		221			203
Other deferred credits and liabilities		56			72
Total deferred credits and other liabilities		2,951			2,916
Commitments and Contingencies (Notes 2, 8 and 9)
Stockholders' Equity:
Common stock, $5 par value, 150.0 shares authorized – 102.1 shares outstanding		511			511
Preferred stock not subject to mandatory redemption		113			113
Other paid-in capital, principally premium on common stock		734			733
Retained earnings		1,744			1,689
Accumulated other comprehensive loss		(33	)		(30	)
Total stockholders' equity		3,069			3,016
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	9,760		$	9,277

The accompanying notes as they relate to UE are an integral part of these consolidated financial statements

UNION ELECTRIC COMPANY
CONSOLIDATED STATEMENT OF CASH FLOWS
(Unaudited) (In millions)

	Six Months Ended June 30,
	2006			2005
Cash Flows From Operating Activities:
Net income	$	143		$	189
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization		161			152
Amortization of nuclear fuel		16			17
Amortization of debt issuance costs and premium/discounts		3			3
Deferred income taxes and investment tax credits, net		11			30
Other		(5	)		(8	)
Changes in assets and liabilities:
Receivables, net		(15	)		(114	)
Materials and supplies		(13	)		5
Accounts and wages payable		(206	)		(61	)
Taxes accrued		54			111
Assets, other		25			(3	)
Liabilities, other		35			11
Pension and other postretirement benefit obligations, net		18			21
Net cash provided by operating activities		227			353

Cash Flows From Investing Activities:
Capital expenditures		(197	)		(248	)
CT acquisitions from non-affiliates		(292	)		-
CT acquisitions from Genco		-			(241	)
Nuclear fuel expenditures		(25	)		(13	)
Sales of emission allowances		2			2
Other		1			8
Net cash used in investing activities		(511	)		(492	)

Cash Flows From Financing Activities:
Dividends on common stock		(84	)		(135	)
Dividends on preferred stock		(3	)		(3	)
Proceeds from intercompany note receivable - CIPS		67			-
Changes in short-term debt, net		284			(237	)
Changes in money pool borrowings		-			380
Issuance of long-term debt		-			85
Capital contribution from parent		1			2
Net cash provided by financing activities		265			92

Net change in cash and cash equivalents		(19	)		(47	)
Cash and cash equivalents at beginning of year		20			48
Cash and cash equivalents at end of period	$	1		$	1

The accompanying notes as they relate to UE are an integral part of these consolidated financial statements

CENTRAL ILLINOIS PUBLIC SERVICE COMPANY
STATEMENT OF INCOME
(Unaudited) (In millions)

	Three Months Ended June 30,					Six Months Ended June 30,
	2006		2005			2006			2005
Operating Revenues:
Electric	$	181	$	171		$	341		$	299
Gas		30		27			127			111
Other		1		-			1			-
Total operating revenues		212		198			469			410

Operating Expenses:
Purchased power		113		105			230			191
Gas purchased for resale		16		15			88			74
Other operations and maintenance		38		37			76			70
Depreciation and amortization		15		15			31			28
Taxes other than income taxes		9		7			21			15
Total operating expenses		191		179			446			378

Operating Income		21		19			23			32

Other Income and Expenses:
Miscellaneous income		4		4			9			9
Miscellaneous expense		-		(4	)		(1	)		(4	)
Total other income		4		-			8			5

Interest Charges		8		8			15			15

Income Before Income Taxes		17		11			16			22

Income Taxes		2		4			2			7

Net Income		15		7			14			15

Preferred Stock Dividends		-		-			1			1

Net Income Available to Common Stockholder	$	15	$	7		$	13		$	14

The accompanying notes as they relate to CIPS are an integral part of these financial statements.

CENTRAL ILLINOIS PUBLIC SERVICE COMPANY
BALANCE SHEET
(Unaudited) (In millions)
	June 30,			December 31,
	2006			2005
ASSETS
Current Assets:
Cash and cash equivalents	$	1		$	-
Accounts receivable – trade (less allowance for doubtful
accounts of $4 and $4, respectively)		57			70
Unbilled revenue		57			71
Accounts receivable – affiliates		11			18
Current portion of intercompany note receivable – Genco		37			34
Current portion of intercompany tax receivable – Genco		10			10
Advances to money pool		17			-
Materials and supplies		54			75
Other current assets		19			28
Total current assets		263			306
Property and Plant, Net		1,141			1,130
Investments and Other Assets:
Intercompany note receivable – Genco		126			163
Intercompany tax receivable – Genco		120			125
Other assets		15			24
Regulatory assets		35			36
Total investments and other assets		296			348
TOTAL ASSETS	$	1,700		$	1,784

LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Current maturities of long-term debt	$	-		$	20
Accounts and wages payable		26			36
Accounts and wages payable – affiliates		65			65
Borrowings from money pool		-			2
Current portion of intercompany note payable – UE		-			6
Taxes accrued		7			26
Other current liabilities		37			43
Total current liabilities		135			198
Long-term Debt, Net		471			410
Deferred Credits and Other Liabilities:
Accumulated deferred income taxes and investment tax credits, net		295			302
Intercompany note payable – UE		-			61
Regulatory liabilities		209			208
Other deferred credits and liabilities		39			36
Total deferred credits and other liabilities		543			607
Commitments and Contingencies (Notes 2 and 8)
Stockholders' Equity:
Common stock, no par value, 45.0 shares authorized – 25.5 shares outstanding		-			-
Other paid-in capital		189			189
Preferred stock not subject to mandatory redemption		50			50
Retained earnings		316			329
Accumulated other comprehensive income (loss)		(4	)		1
Total stockholders' equity		551			569
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	1,700		$	1,784

The accompanying notes as they relate to CIPS are an integral part of these financial statements.

CENTRAL ILLINOIS PUBLIC SERVICE COMPANY
STATEMENT OF CASH FLOWS
(Unaudited) (In millions)

	Six Months Ended June 30,
	2006			2005
Cash Flows From Operating Activities:
Net income	$	14		$	15
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization		31			28
Deferred income taxes and investment tax credits, net		(16	)		(7	)
Other		(1	)		(4	)
Changes in assets and liabilities:
Receivables, net		39			10
Materials and supplies		21			7
Accounts and wages payable		(9	)		17
Taxes accrued		(19	)		11
Assets, other		22			10
Liabilities, other		(3	)		5
Pension and other postretirement benefit obligations, net		-			4
Net cash provided by operating activities		79			96

Cash Flows From Investing Activities:
Capital expenditures		(40	)		(24	)
Proceeds from intercompany note receivable – Genco		34			52
Changes in money pool advances		(17	)		(28	)
Net cash used in investing activities		(23	)		-

Cash Flows From Financing Activities:
Dividends on common stock		(25	)		(9	)
Dividends on preferred stock		(1	)		(1	)
Capital issuance costs		(1	)		-
Changes in money pool borrowings		(2	)		(68	)
Redemptions, repurchases, and maturities:
Long-term debt		(20	)		(20	)
Intercompany note payable - UE		(67	)		-
Issuances:
Long-term debt		61			-
Capital contribution from parent		-			1
Net cash used in financing activities		(55	)		(97	)

Net change in cash and cash equivalents		1			(1	)
Cash and cash equivalents at beginning of year		-			2
Cash and cash equivalents at end of period	$	1		$	1

The accompanying notes as they relate to CIPS are an integral part of these financial statements.

AMEREN ENERGY GENERATING COMPANY
CONSOLIDATED STATEMENT OF INCOME
(Unaudited) (In millions)

	Three Months Ended June 30,				Six Months Ended June 30,
	2006		2005		2006		2005
Operating Revenues:
Electric	$	238	$	266	$	485	$	491
Total operating revenues		238		266		485		491

Operating Expenses:
Fuel and purchased power		150		138		315		237
Other operations and maintenance		47		38		79		76
Depreciation and amortization		17		18		35		37
Taxes other than income taxes		5		5		11		3
Total operating expenses		219		199		440		353

Operating Income		19		67		45		138

Other Income:
Miscellaneous income		-		1		-		1
Total other income		-		1		-		1

Interest Charges		15		19		30		40

Income Before Income Taxes		4		49		15		99

Income Taxes		2		18		7		37

Net Income	$	2	$	31	$	8	$	62

The accompanying notes as they relate to Genco are an integral part of these consolidated financial statements.

AMEREN ENERGY GENERATING COMPANY
CONSOLIDATED BALANCE SHEET
(Unaudited) (In millions, except shares)

	June 30,			December 31,
	2006			2005
ASSETS
Current Assets:
Cash and cash equivalents	$	1		$	-
Accounts receivable – affiliates		97			102
Accounts receivable		7			29
Materials and supplies		99			73
Other current assets		1			1
Total current assets		205			205
Property and Plant, Net		1,505			1,514
Intangible Assets		90			79
Other Assets		13			13
TOTAL ASSETS	$	1,813		$	1,811

LIABILITIES AND STOCKHOLDER'S EQUITY
Current Liabilities:
Current portion of intercompany note payable – CIPS	$	37		$	34
Borrowings from money pool		260			203
Accounts and wages payable		27			41
Accounts and wages payable – affiliates		97			60
Current portion of intercompany tax payable – CIPS		10			10
Taxes accrued		14			37
Other current liabilities		23			16
Total current liabilities		468			401
Long-term Debt, Net		474			474
Intercompany Note Payable – CIPS		126			163
Deferred Credits and Other Liabilities:
Accumulated deferred income taxes, net		142			156
Accumulated deferred investment tax credits		9			10
Intercompany tax payable – CIPS		120			125
Asset retirement obligations		29			29
Accrued pension and other postretirement benefits		11			8
Other deferred credits and liabilities		2			1
Total deferred credits and other liabilities		313			329
Commitments and Contingencies (Notes 2 and 8)
Stockholder's Equity:
Common stock, no par value, 10,000 shares authorized – 2,000 shares outstanding		-			-
Other paid-in capital		278			228
Retained earnings		157			220
Accumulated other comprehensive loss		(3	)		(4	)
Total stockholder's equity		432			444
TOTAL LIABILITIES AND STOCKHOLDER'S EQUITY	$	1,813		$	1,811

The accompanying notes as they relate to Genco are an integral part of these consolidated financial statements.

AMEREN ENERGY GENERATING COMPANY
CONSOLIDATED STATEMENT OF CASH FLOWS
(Unaudited) (In millions)

	Six Months Ended June 30,
	2006			2005
Cash Flows From Operating Activities:
Net income	$	8		$	62
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization		51			47
Amortization of debt issuance costs and discounts		-			1
Deferred income taxes and investment tax credits, net		(8	)		16
Other		(1	)		-
Changes in assets and liabilities:
Accounts receivable		27			(16	)
Materials and supplies		(26	)		(6	)
Accounts and wages payable		28			40
Taxes accrued, net		(23	)		(12	)
Assets, other		-			6
Liabilities, other		(4