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 Ci~tion                        Search Result       Rank 139 of 242       Databas
 3   '1/01 FTCOM (No Page)                                                FTI
    .~.8/0l Fin. Times - FT.com (Pg. Unavail. Online)
 ~ul WL 28471917

			      Financial Times - FT.com
	      (c) 2001 Financial Times Limited . All Rights Reserved

			     Thursday, October 18, 2001

		  Analysts vent anger at 'hidden' Enron charge.
				  By JULIE EARLE.

 Enron, the US energy trader which is under intense scrutiny by analysts who
 have demanded the company release more detailed financial information, on
 Wednesday gave details of a $l.2bn charge against equity it skipped over in
 its third quarter results briefing on Tuesday.

 On Wednesday, Enron outlined details of a $l.Olbn charge against earnings in
 its result, due to failed investments in its telecommunications, retail energy
 sales and water businesses.

 Ken Lay, chairman, fleetingly mentioned a separate $l.2bn charge against
 equity, or a dilution of equity on the company's balance sheet, in a
 conference call with analysts and the media, and said it would not affect the
 c-any's credit rating.

 Ma~.2 analysts apparently thought this was the $l.Olbn charge Mr Lay was
 willing to break down and to answer questions about.

 Mr Lay met analysts on Wednesday in New York, but there was again no mention
 of the $l.2bn charge. Mr Lay apparently initially refused to answer questions
 from frustrated analysts. In August, after the departure of Enron's chief
 financial officer, Jeff Skilling, Mr Lay promised to provide more earnings
 transparency.

 "It was unbelievable. Questions were asked and he moved around it and then
 finally he (Mr Layl gave a roundabout answer. The [$l.2bn] charge was all
 related to the writing down of the se failed investments," one analyst said.

 "They were trying to sneak it by. They already have a credibility problem and
 this did not help it," he said, adding that Enron never disclosed the charge's
 net effect and Moody's Inv estor's Services, the credit rating agency, placed
 Enron's $l3bn of debt on hold minutes later. "We told them we felt they should
 have been more honest in the presentation [yesterdayl -'I
 Enron rejected criticism of the failure to fully report and explain the $l.2bn
 charge.

      ~pyright Financial Times Group.

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