CenterPoint Energy Reports Third Quarter 2008 Earnings

Results in Natural Gas Gathering and Commercial Sales Businesses Produce Strong Quarter


HOUSTON, Nov. 5, 2008 (GLOBE NEWSWIRE) -- CenterPoint Energy, Inc. (NYSE:CNP) today reported net income of $136 million, or $0.39 per diluted share, for the third quarter of 2008 compared to $91 million, or $0.27 per diluted share, for the same period of 2007.

"We continue to see the benefits of our balanced electric and natural gas portfolio. Strong results in our field services and competitive natural gas businesses helped offset the loss of revenue from Hurricane Ike," said David M. McClanahan, president and chief executive officer of CenterPoint Energy. "With over 90 percent of our customers without power following the storm, the challenges brought on by Hurricane Ike were significant. I'm extremely proud of the extraordinary efforts of our employees and the thousands of workers from 35 other states and Canada who worked to repair our system and restore service to our customers."

For the nine months ended September 30, 2008, net income was $360 million, or $1.05 per diluted share, compared to $291 million, or $0.85 per diluted share, for the same period of 2007.

OPERATING INCOME BY SEGMENT

Electric Transmission & Distribution

The electric transmission & distribution segment reported operating income of $202 million for the third quarter of 2008, consisting of $169 million from the regulated electric transmission & distribution utility operations (TDU) and $33 million related to transition bonds. Operating income for the third quarter of 2007 was $196 million, consisting of $155 million from the TDU, $30 million related to transition bonds, and $11 million from the competition transition charge (CTC). In February 2008, the company monetized the remaining allowed true-up balance, resulting in the discontinuance of the CTC.

When Hurricane Ike's 110 mile-per-hour winds struck our service territory in September, more than 2 million customers lost power, but the TDU was able to restore power to all customers capable of receiving it within 18 days. As a result of this timely restoration effort, the estimated loss of third quarter revenue to the TDU was limited to $17 million. The loss of revenue from Hurricane Ike was more than offset by strong customer growth of over 42,000 metered customers since September 2007, increased usage, and reduced costs associated with normal operating and maintenance activities delayed because of the storm. In addition, taxes other than income taxes declined due to the Texas margin tax being classified as income tax beginning in 2008 and a refund of prior-year state franchise taxes.

The cost to repair the system and restore service is estimated to be in the range of $650 to $750 million. These costs are being deferred for future recovery through the regulatory process and therefore do not affect third quarter earnings.

Operating income for the nine months ended September 30, 2008, was $457 million, consisting of $352 million from the TDU, $100 million related to transition bonds, and $5 million from the CTC. Operating income for the same period of 2007 was also $457 million, consisting of $335 million from the TDU, $90 million related to transition bonds, and $32 million from the CTC.

Natural Gas Distribution

The natural gas distribution segment reported an operating loss of $6 million for the third quarter of 2008 compared to a loss of $8 million for the same period of 2007. Operating income benefited from new rates implemented in late 2007 and continued customer growth of nearly 26,000 metered customers since September 2007. Due to seasonal impacts, the third quarter is typically the weakest quarter for this segment.

Operating income for the nine months ended September 30, 2008, was $119 million compared to $129 million for the same period of 2007.

Interstate Pipelines

The interstate pipelines segment reported operating income of $55 million for the third quarter of 2008 compared to $70 million for the same period of 2007. The third quarter of 2008 included a $7 million write-down associated with pipeline assets removed from service, while the third quarter of 2007 included tax refunds of $4 million related to settlements of certain state tax issues and gains of $5 million associated with the sale of the pipeline services business. Excluding these items, higher income from the Carthage to Perryville pipeline and other transportation services was offset by reduced ancillary services and higher operation and maintenance expenses.

Operating income for the nine months ended September 30, 2008, was $227 million compared to $166 million for the same period of 2007.

Field Services

The field services segment reported operating income of $44 million for the third quarter of 2008 compared to $26 million for the same period of 2007. Operating income increased primarily from higher throughput, increased ancillary services, and a gain of $7 million associated with system imbalances.

In addition to operating income, this business had equity income of $4 million in the third quarter of 2008 compared to $2 million in the third quarter of 2007 from its 50 percent interest in a jointly-owned gas processing plant. These amounts are included in Other - net under the Other Income (Expense) caption.

Operating income for the nine months ended September 30, 2008, was $121 million compared to $75 million for the same period of 2007. Equity income from the jointly-owned gas processing plant was $12 million for the nine months ended September 30, 2008, compared to $6 million for the same period of 2007.

Competitive Natural Gas Sales and Services

The competitive natural gas sales and services segment reported operating income of $35 million for the third quarter of 2008 compared to $4 million for the same period of 2007. Approximately $7 million of the increase was due to favorable locational and seasonal price differentials. The third quarter of 2008 included gains of $46 million resulting from mark-to-market accounting for derivatives used to lock in economic margins of certain forward natural gas sales compared to mark-to-market gains of $2 million for the same period of 2007. The third quarter of 2008 also included a $24 million write-down of natural gas inventory to the lower of average cost or market, compared to a $5 million inventory write-down for the same period of 2007.

Operating income for the nine months ended September 30, 2008, was $36 million compared to $56 million for the same period of 2007. The nine months ended September 30, 2008, included gains of $14 million resulting from mark-to-market accounting compared to charges of $12 million for the same period of 2007. Additionally, the nine months ended September 30, 2008, included $24 million in inventory write-downs compared to $11 million in inventory write-downs for the same period of 2007.

DIVIDEND DECLARATION

On October 30, 2008, CenterPoint Energy's board of directors declared a regular quarterly cash dividend of $0.1825 per share of common stock payable on December 10, 2008, to shareholders of record as of the close of business on November 14, 2008.

2008 REVISED GUIDANCE

CenterPoint Energy expects diluted earnings per share for 2008 to be in the range of $1.25 to $1.35. Previously-provided guidance was for earnings to be in the upper half of $1.15 to $1.25 per diluted share. This guidance takes into consideration performance to date as well as various economic and operational assumptions related to the business segments in which the company operates. The company has made certain assumptions regarding the impact to earnings of various regulatory proceedings, including recovery of costs associated with Hurricane Ike, but cannot predict the ultimate outcome of any of those proceedings. In providing this guidance, the company has not projected the impact of any changes in accounting standards, any impact from acquisitions or divestitures, the timing effects of mark-to-market or inventory accounting in our competitive natural gas sales and services business, or the outcome of the TDU's true-up appeal.

FILING OF FORM 10-Q FOR CENTERPOINT ENERGY, INC.

Today, CenterPoint Energy, Inc. filed with the Securities and Exchange Commission (SEC) its Quarterly Report on Form 10-Q for the period ended September 30, 2008. A copy of that report is available on the company's Web site, www.CenterPointEnergy.com, under the Investors section. Other filings the company makes at the SEC and other documents relating to its corporate governance can also be found on that site.

WEBCAST OF EARNINGS CONFERENCE CALL

CenterPoint Energy's management will host an earnings conference call on Wednesday, November 5, 2008, at 10:30 a.m. Central time or 11:30 a.m. Eastern time. Interested parties may listen to a live audio broadcast of the conference call at www.CenterPointEnergy.com. A replay of the call can be accessed approximately two hours after the completion of the call and will be archived on the Web site for at least one year.

CenterPoint Energy, Inc., headquartered in Houston, Texas, is a domestic energy delivery company that includes electric transmission & distribution, natural gas distribution, competitive natural gas sales and services, interstate pipelines, and field services operations. The company serves more than five million metered customers primarily in Arkansas, Louisiana, Minnesota, Mississippi, Oklahoma, and Texas. Assets total over $19 billion. With about 8,600 employees, CenterPoint Energy and its predecessor companies have been in business for more than 130 years. For more information, visit the Web site at www.CenterPointEnergy.com.

This news release includes forward-looking statements. Actual events and results may differ materially from those projected. The statements in this news release regarding future financial performance and results of operations and other statements that are not historical facts are forward-looking statements. Factors that could affect actual results include the timing and outcome of appeals from the true-up proceedings, the timing and impact of future regulatory, legislative and IRS decisions, effects of competition, weather variations, changes in CenterPoint Energy's or its subsidiaries' business plans, financial market conditions, the timing and extent of changes in commodity prices, particularly natural gas, the impact of unplanned facility outages, and other factors discussed in CenterPoint Energy's and its subsidiaries' Form 10-Ks for the period ended December 31, 2007, CenterPoint Energy's and its subsidiaries' Form 10-Qs for the periods ended March 31, 2008, and June 30, 2008, CenterPoint Energy's Form 10-Q for the period ended September 30, 2008, and other filings with the SEC.



           CenterPoint Energy, Inc. and Subsidiaries
               Statements of Consolidated Income
                     (Millions of Dollars)
                          (Unaudited)

                                                         Nine Months
                                         Quarter Ended     Ended
                                         September 30,  September 30,
                                        --------------  --------------
                                         2007    2008    2007    2008
                                        ------  ------  ------  ------

 Revenues:
  Electric Transmission
   & Distribution                       $  528  $  552  $1,399  $1,471
  Natural Gas Distribution                 458     550   2,601   2,976
  Competitive Natural Gas Sales
   and Services                            770   1,269   2,715   3,632
  Interstate Pipelines                     137     143     348     468
  Field Services                            44      71     125     191
  Other Operations                           3       3       8       8
  Eliminations                             (58)    (73)   (175)   (198)
                                        ------  ------  ------  ------
   Total                                 1,882   2,515   7,021   8,548
                                        ------  ------  ------  ------

 Expenses:
  Natural gas                              991   1,532   4,349   5,675
  Operation and maintenance                349     371   1,031   1,078
  Depreciation and amortization            170     194     475     540
  Taxes other than income taxes             85      81     284     285
                                        ------  ------  ------  ------
   Total                                 1,595   2,178   6,139   7,578
                                        ------  ------  ------  ------
 Operating Income                          287     337     882     970
                                        ------  ------  ------  ------

 Other Income (Expense) :
  Loss on Time Warner investment           (58)    (36)    (74)    (73)
  Gain on indexed debt securities           56      33      70      66
  Interest and other finance charges      (126)   (116)   (368)   (344)
  Interest on transition bonds             (30)    (34)    (93)   (102)
  Distribution from AOL Time Warner
   litigation settlement                    32      --      32      --
  Additional distribution
   to ZENS holders                         (27)     --     (27)     --
  Other - net                               11      29      23      56
                                        ------  ------  ------  ------
   Total                                  (142)   (124)   (437)   (397)
                                        ------  ------  ------  ------

 Income Before Income Taxes                145     213     445     573

 Income Tax Expense                        (54)    (77)   (154)   (213)
                                        ------  ------  ------ -------

 Net Income                             $   91  $  136  $  291  $  360
                                        ======  ======  ======  ======

      Reference is made to the Notes to the Consolidated Financial
      Statements contained in the Quarterly Report on Form 10-Q of
                         CenterPoint Energy, Inc.


              CenterPoint Energy, Inc. and Subsidiaries
        Selected Data From Statements of Consolidated Income
      (Millions of Dollars, Except Share and Per Share Amounts)
                             (Unaudited)

                                   Quarter Ended     Nine Months Ended
                                   September 30,       September 30,
                                ------------------  ------------------
                                  2007      2008      2007      2008
                                --------  --------  --------  --------

 Basic Earnings Per Common
  Share:
  Net Income                    $   0.29  $   0.40  $   0.91  $   1.08
                                ========  ========  ========  ========

 Diluted Earnings Per Common
  Share:
  Net Income                    $   0.27  $   0.39  $   0.85  $   1.05
                                ========  ========  ========  ========

 Dividends Declared per Common
  Share                         $   0.17  $ 0.1825  $   0.51  $ 0.5475

 Weighted Average Common Shares
  Outstanding (000):
  - Basic                        321,192   342,228   320,071   333,652
  - Diluted                      340,974   344,584   342,222   342,187


 Operating Income (Loss) by
  Segment
 --------------------------

 Electric Transmission &
  Distribution:
  Electric Transmission and
   Distribution Operations      $    155  $    169  $    335  $    352
  Competition Transition Charge       11        --        32         5
                                --------  --------  --------  --------
   Total Electric Transmission
    and Distribution Utility         166       169       367       357
  Transition Bond Companies           30        33        90       100
                                --------  --------  --------  --------
   Total Electric Transmission
    & Distribution                   196       202       457       457
 Natural Gas Distribution             (8)       (6)      129       119
 Competitive Natural Gas Sales
  and Services                         4        35        56        36
 Interstate Pipelines                 70        55       166       227
 Field Services                       26        44        75       121
 Other Operations                     (1)        7        (1)       10
                                --------  --------  --------  --------

 Total                          $    287  $    337  $    882  $    970
                                ========  ========  ========  ========

     Reference is made to the Notes to the Consolidated Financial
     Statements contained in the Quarterly Report on Form 10-Q of
                      CenterPoint Energy, Inc.


              CenterPoint Energy, Inc. and Subsidiaries
                  Results of Operations by Segment
                        (Millions of Dollars)
                             (Unaudited)

                        Electric Transmission & Distribution
               -------------------------------------------------------

                   Quarter Ended             Nine Months Ended
                   September 30,    % Diff     September 30,    % Diff
               ---------------------  Fav/ ---------------------  Fav/
                  2007       2008   (Unfav)   2007       2008   (Unfav)
               ---------- ---------- ----- ---------- ---------- -----
 Results of
  Operations:
 Revenues:
  Electric
   transmission
   and
   distribution
   utility     $      445 $      455   2%  $    1,187 $    1,220    3%
  Transition
   bond
   companies           83         97  17%         212        251   18%
               ---------- ----------       ---------- ---------- 
   Total              528        552   5%       1,399      1,471    5%
               ---------- ----------       ---------- ---------- 

 Expenses:
  Operation and
   maintenance        163        167  (2%)        467        502   (7%)
  Depreciation
   and
   amortization        58         71 (22%)        182        208  (14%)
  Taxes other
   than income
   taxes               58         48  17%         171        153   11%
  Transition
   bond
   companies           53         64 (21%)        122        151  (24%)
               ---------- ----------       ---------- ---------- 
   Total              332        350  (5%)        942      1,014   (8%)
               ---------- ----------       ---------- ---------- 
 Operating
  Income       $      196 $      202   3%  $      457 $      457   --
               ========== ==========       ========== ========== 

 Operating
  Income:
  Electric
   transmission
   and
   distribution
   operations  $      155 $      169   9%  $      335 $      352    5%
  Competition
   transition
   charge              11         --  --           32          5  (84%)
  Transition
   bond
   companies           30         33  10%          90        100   11%
               ---------- ----------       ---------- ----------  
   Total
    Segment
    Operating
    Income     $      196 $      202   3%  $      457 $      457   --
               ========== ==========       ========== ========== 

 Electric
  Transmission &
  Distribution
  Operating
  Data:
 Actual MWH
  Delivered
  Residential   8,381,258  8,445,744   1%  19,060,031 19,623,125    3%
  Total        22,725,500 21,594,051  (5%) 58,560,692 58,523,281   --

 Weather
  (average for
  service
  area):
 Percentage of
  10-year
  average:
  Cooling
   degree days        102%        97% (5%)         99%       104%   5%
  Heating
   degree days          0%         0%  0%         114%        95% (19%)


 Average number
  of metered
  customers:
  Residential   1,782,281  1,822,351   2%   1,767,431  1,812,821    3%
  Total         2,022,448  2,066,538   2%   2,006,344  2,055,723    2%


                              Natural Gas Distribution
               -------------------------------------------------------

                   Quarter Ended             Nine Months Ended
                   September 30,    % Diff     September 30,    % Diff
               ---------------------  Fav/ ---------------------  Fav/
                  2007       2008   (Unfav)   2007       2008   (Unfav)
               ---------- ---------- ----- ---------- ---------- -----
 Results of
  Operations:
 Revenues      $     458  $     550   20%  $    2,601 $    2,976   14%
               ---------- ----------       ---------- ---------- 
 Expenses:
  Natural gas        267        351  (31%)      1,845      2,196  (19%)
  Operation and
   maintenance       139        139   --          421        436   (4%)
  Depreciation
   and
   amortization       38         40   (5%)        114        118   (4%)
  Taxes other
   than income
   taxes              22         26  (18%)         92        107  (16%)
               ---------- ----------       ---------- ---------- 
   Total             466        556  (19%)      2,472      2,857  (16%)
               ---------- ----------       ---------- ---------- 
 Operating
  Income
  (Loss)       $      (8) $      (6)  25%  $      129 $      119   (8%)
               ========== ==========       ========== ========== 

 Natural Gas
  Distribution
  Operating
  Data:
  Throughput
   data in BCF
  Residential         12         13    8%         118        117   (1%)
  Commercial
   and
   Industrial         42         41   (2%)        168        171    2%
               ---------- ----------       ---------- ---------- 
   Total
    Throughput        54         54    --         286        288    1%
               ========== ==========       ========== ========== 

 Weather
  (average for
  service area)
 Percentage of
  10-year
  average:
  Heating
   degree days        75%        57% (18%)         98%       106%   8%

 Average number
  of customers:
  Residential  2,910,041  2,937,618    1%   2,927,122  2,956,500    1%
  Commercial
   and
   Industrial    246,021    245,514    --     246,382    248,759    1%
               ---------- ----------       ---------- ---------- 
   Total       3,156,062  3,183,132    1%   3,173,504  3,205,259    1%
               ========== ==========       ========== ========== 

    Reference is made to the Notes to the Consolidated Financial
    Statements contained in the Quarterly Report on Form 10-Q of
                      CenterPoint Energy, Inc.


              CenterPoint Energy, Inc. and Subsidiaries
                  Results of Operations by Segment
                        (Millions of Dollars)
                             (Unaudited)

                            Competitive Natural Gas Sales and Services
                            ------------------------------------------
                                                    Nine Months
                             Quarter Ended             Ended
                             September 30, % Diff  September 30, % Diff
                            --------------   Fav/  --------------  Fav/
                             2007    2008  (Unfav) 2007    2008 (Unfav)
                            ------  ------  ----- ------  ------ -----
 Results of Operations:
 Revenues                   $  770  $1,269   65%  $2,715  $3,632   34%
                            ------  ------        ------  ------ 
 Expenses:
  Natural gas                  756   1,225  (62%)  2,631   3,567  (36%)
  Operation and maintenance      7       8  (14%)     23      26  (13%)
  Depreciation and
   amortization                  3       1   67%       4       2   50%
  Taxes other than income
   taxes                        --      --   --        1       1    --
                            ------  ------        ------  ------ 
   Total                       766   1,234  (61%)  2,659   3,596  (35%)
                            ------  ------        ------  ------ 
 Operating Income           $    4  $   35  775%  $   56  $   36  (36%)
                            ======  ======        ======  ====== 

 Competitive Natural Gas
  Sales and Services
  Operating Data:
 Throughput data in BCF        119     125    5%     393     392   --
                            ======  ======        ======  ====== 

 Average number of
  customers                  6,976   9,245   33%   7,014   8,974   28%
                            ======  ======        ======  ====== 


                                      Interstate Pipelines
                            ------------------------------------------
                                                    Nine Months
                             Quarter Ended             Ended
                             September 30, % Diff  September 30, % Diff
                            --------------   Fav/  -------------  Fav/
                             2007    2008  (Unfav) 2007    2008 (Unfav)
                            ------  ------  ----- ------  ------ -----
 Results of Operations:
 Revenues                   $  137  $  143    4%  $  348  $  468   34%
                            ------  ------        ------  ------ 
 Expenses:
  Natural gas                   27      24   11%      55      97  (76%)
  Operation and maintenance     29      47  (62%)     85      93   (9%)
  Depreciation and
   amortization                 11      11     --     32      34   (6%)
  Taxes other than income
   taxes                        --       6     --     10      17  (70%)
                            ------  ------        ------  ------ 
   Total                        67      88  (31%)    182     241  (32%)
                            ------  ------        ------  ------ 
 Operating Income           $   70  $   55  (21%) $  166  $  227   37%
                            ======  ======        ======  ====== 

 Pipelines Operating Data:
 Throughput data in BCF
  Transportation               312     360   15%     880   1,145   30%
                            ======  ======        ======  ====== 

    Reference is made to the Notes to the Consolidated Financial
    Statements contained in the Quarterly Report on Form 10-Q of
                      CenterPoint Energy, Inc.


              CenterPoint Energy, Inc. and Subsidiaries
                  Results of Operations by Segment
                        (Millions of Dollars)
                             (Unaudited)

                                          Field Services
                            ------------------------------------------
                                                   Nine Months
                            Quarter Ended             Ended
                            September 30, % Diff  September 30, % Diff
                            -------------   Fav/  -------------   Fav/
                             2007    2008  (Unfav) 2007    2008 (Unfav)
                            -----   -----  ------ -----   ----- ------
 Results of Operations:
 Revenues                   $  44   $  71    61%  $ 125   $ 191    53%
                            -----   -----         -----   ----- 
 Expenses:
  Natural gas                  (2)      5  (350%)    (9)     11  (222%)
  Operation and maintenance    17      19   (12%)    49      48     2%
  Depreciation and
   amortization                 2       3   (50%)     8       9   (13%)
  Taxes other than income
   taxes                        1      --      --     2       2     --
                            -----   -----         -----   ----- 
   Total                       18      27   (50%)    50      70   (40%)
                            -----   -----         -----   ----- 
 Operating Income           $  26   $  44    69%  $  75   $ 121    61%
                            =====   =====         =====   =====  

 Field Services Operating
  Data:
 Throughput data in BCF
  Gathering                   104     109     5%    297     311     5%
                            =====   =====         =====   =====  


                                         Other Operations
                            ------------------------------------------
                                                   Nine Months
                            Quarter Ended             Ended
                            September 30, % Diff  September 30, % Diff
                            -------------  Fav/   -------------  Fav/
                             2007    2008 (Unfav) 2007    2008  (Unfav)
                            -----   -----  ------ -----   ----- ------
 Results of Operations:
 Revenues                   $   3   $   3     --  $   8   $   8    --
 Expenses                       4      (4)  200%      9      (2)  122%
                            -----   -----          ----   ----- 
 Operating Income (Loss)    $  (1)  $   7   800%  $  (1)  $  10  1,100%
                            =====   =====         =====   =====  


                              Capital Expenditures by Segment
                                    (Millions of Dollars)
                                         (Unaudited)
                            -----------------------------------
                                                   Nine Months
                            Quarter Ended             Ended
                            September 30,         September 30,
                            -------------         -------------
                             2007    2008          2007    2008
                            -----   -----         -----   -----
 Capital Expenditures by
  Segment
  Electric Transmission &
   Distribution             $  83   $  80         $ 304   $ 256
  Hurricane Ike                --     141            --     141
                            -----   -----         -----   -----
   Total Electric
    Transmission &
    Distribution               83     221           304     397
  Natural Gas Distribution     58      57           135     151
  Competitive Natural Gas
   Sales and Services           1       1             5       3
  Interstate Pipelines         39      60           253     130
  Field Services               15      31            55      77
  Other Operations              5       5            22      18
                            -----   -----         -----   -----
   Total                    $ 201   $ 375         $ 774   $ 776
                            =====   =====         =====   =====


                                  Interest Expense Detail
                                   (Millions of Dollars)
                                        (Unaudited)
                            -----------------------------------
                                                   Nine Months
                            Quarter Ended             Ended
                            September 30,         September 30,
                            -------------         -------------
                             2007    2008          2007    2008
                            -----   -----         -----   -----
 Interest Expense Detail
  Amortization of Deferred
   Financing Cost           $  11   $   6         $  42   $  18
  Capitalization of
   Interest Cost               (3)     (3)          (18)    (10)
  Transition Bond Interest
   Expense                     30      34            93     102
  Other Interest Expense      118     113           344     336
                            -----   -----         -----   -----
   Total Interest Expense   $ 156   $ 150         $ 461   $ 446
                            =====   =====         =====   =====

    Reference is made to the Notes to the Consolidated Financial
    Statements contained in the Quarterly Report on Form 10-Q of
                      CenterPoint Energy, Inc.


                    CenterPoint Energy, Inc. and Subsidiaries
                      Condensed Consolidated Balance Sheets
                              (Millions of Dollars)
                                   (Unaudited)


                                                    Dec. 31,  Sept. 30,
                                                      2007      2008
                                                    --------  --------
                   ASSETS

 Current Assets:
  Cash and cash equivalents                         $    129  $     84
  Other current assets                                 2,659     2,753
                                                    --------  --------
   Total current assets                                2,788     2,837
                                                    --------  --------
 Property, Plant and Equipment, net                    9,740    10,149
                                                    --------  --------

 Other Assets:
  Goodwill                                             1,696     1,696
  Regulatory assets                                    2,993     3,219
  Other non-current assets                               655     1,131
                                                    --------  --------
   Total other assets                                  5,344     6,046
                                                    --------  --------
     Total Assets                                   $ 17,872  $ 19,032
                                                    ========  ========

      LIABILITIES AND SHAREHOLDERS' EQUITY

 Current Liabilities:
  Short-term borrowings                             $    232  $    150
  Current portion of transition bond long-term debt      159       208
  Current portion of other long-term debt              1,156       123
  Other current liabilities                            2,244     2,391
                                                    --------  --------
   Total current liabilities                           3,791     2,872
                                                    --------  --------

 Other Liabilities:
   Accumulated deferred income taxes, net
    and investment tax credit                          2,266     2,713
   Regulatory liabilities                                828       808
   Other non-current liabilities                         813       783
                                                    --------  --------
    Total other liabilities                            3,907     4,304
                                                    --------  --------

 Long-term Debt:
   Transition bond                                     2,101     2,381
   Other                                               6,263     7,416
                                                    --------  --------
    Total long-term debt                               8,364     9,797
                                                    --------  --------
 Shareholders' Equity                                  1,810     2,059
                                                    --------  --------
    Total Liabilities and Shareholders' Equity      $ 17,872  $ 19,032
                                                    ========  ========

   Reference is made to the Notes to the Consolidated Financial
   Statements contained in the Quarterly Report on Form 10-Q of
                      CenterPoint Energy, Inc.



                CenterPoint Energy, Inc. and Subsidiaries
             Condensed Statements of Consolidated Cash Flows
                           (Millions of Dollars)
                                (Unaudited)

                                                     Nine Months Ended
                                                       September 30,
                                                    ------------------
                                                      2007      2008
                                                    --------  --------
 Cash Flows from Operating Activities:
  Net income                                        $    291  $    360
  Adjustments to reconcile net income to net
   cash provided by operating activities:
    Depreciation and amortization                        519       560
    Deferred income taxes                                 23       471
    Changes in net regulatory assets                      57       (48)
    Changes in other assets and liabilities             (410)     (584)
    Other, net                                            12       (35)
                                                    --------  --------
 Net Cash Provided by Operating Activities               492       724

 Net Cash Used in Investing Activities                  (933)     (991)

 Net Cash Provided by Financing Activities               368       222
                                                    --------  --------

 Net Decrease in Cash and Cash Equivalents               (73)      (45)

 Cash and Cash Equivalents at Beginning of 

  Period                                                 127       129

                                                    --------  --------
 Cash and Cash Equivalents at End of Period         $     54  $     84
                                                    ========  ========

     Reference is made to the Notes to the Consolidated Financial
     Statements contained in the Quarterly Report on Form 10-Q of
                     CenterPoint Energy, Inc.


            

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