Mirant Corporation (Mirant) has reported a net income of $1.26 billion for the year-end of 2008, compared with the net income of $1.99 million in the previous year-end. It has also reported adjusted EBITDA of $782 million for the year-end of 2008, compared with the adjusted EBITDA of $988 million in the previous year-end.

Mirant reported adjusted net income from continuing operations of $517 million for 2008, or diluted earnings per share of $2.60, compared to adjusted net income from continuing operations of $805 million for 2007, or diluted earnings per share of $2.91. Adjusted net income excludes unrealized gains and losses and other non-recurring items, including, for 2007, a $362 million gain related to the Pepco settlement and a $175 million impairment loss related to the Lovett generating facility. The year over year change resulted principally from lower realized gross margin and higher net interest expense because of lower interest income related to decreased cash balances as a result of returning $2.74 billion of cash to stockholders during 2008.

Net cash provided by operating activities of continuing operations for 2008 was $677 million compared to $786 million for 2007.

As of December 31, 2008, the company had cash and cash equivalents of $1.831 billion, of which $354 million was restricted at Mirant North America and its subsidiaries and not available for distribution to Mirant. In addition, Mirant North America was restricted from further distributions, beyond permitted interest payable by its parent, Mirant Americas Generation, primarily because of the significant capital expenditure program underway to comply with the Maryland Healthy Air Act. Mirant does not expect the restriction on distributions to have any effect on its operations.

As of December 31, 2008, the company had total outstanding debt of $2.676 billion.

Mirant reported net income from continuing operations for the fourth quarter of 2008 of $594 million compared to net income from continuing operations of $7 million for the same period last year. Results for 2008 include unrealized gains, principally on hedges, of $568 million compared to unrealized losses of $153 million for 2007. Per share results from continuing operations for the fourth quarter of 2008 were $3.94 per share, compared to $0.03 per share from continuing operations for the fourth quarter of 2007.

Mirant reported adjusted net income from continuing operations of $77 million for the fourth quarter of 2008, or diluted earnings per share of $0.51, compared to adjusted net income from continuing operations of $191 million for the fourth quarter of 2007, or diluted earnings per share of $0.72. Adjusted net income excludes unrealized gains and losses and other non-recurring items. The period over period change resulted principally from lower realized gross margin and higher net interest expense because of lower interest income related to decreased cash balances as a result of returning $2.74 billion of cash to stockholders during 2008.

Adjusted EBITDA from continuing operations for the fourth quarter of 2008 was $150 million, compared to adjusted EBITDA from continuing operations of $214 million for the fourth quarter 2007. The change in adjusted EBITDA resulted principally from lower energy gross margins in the Mid-Atlantic region primarily because of compressed dark spreads and lower realized gross margins from fuel oil management and proprietary trading activities, partially offset by higher realized value of hedges.

Net cash provided by operating activities of continuing operations for the fourth quarter of 2008 was $90 million compared to net cash provided by operating activities of $116 million for the same period in 2007.

Guidance

Mirant revised its 2009 adjusted EBITDA guidance from $981 million to $897 million and provided initial 2010 adjusted EBITDA guidance of $667 million. Our strategy of hedging has cushioned us in 2009 and somewhat in 2010 from the effects of falling prices for electricity, said Edward R. Muller, chairman and chief executive officer.

Return of Cash to Stockholders

Mirant announced in November 2008 that it was resuming its program of returning cash to stockholders and would begin open market purchases for $200 million. The company completed these purchases in December. Along with $3.856 billion of stock repurchases made between November 2007 and September 2008, the company has returned $4.056 billion to stockholders.

Mirant is a energy company that produces and sells electricity in the US.