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CenterPoint Energy Reports Second Quarter 2010 Earnings

HOUSTON, Aug 04, 2010 /PRNewswire via COMTEX News Network/ -- CenterPoint Energy, Inc. (NYSE: CNP) today reported net income of $81 million, or $0.20 per diluted share, for the second quarter of 2010 compared to $86 million, or $0.24 per diluted share, for the same period of 2009. Operating income for the second quarter of 2010 was $263 million compared to $253 million for the same period of 2009.

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"I am pleased with our operating performance this quarter," said David M. McClanahan, president and chief executive officer of CenterPoint Energy. "Our electric and natural gas distribution businesses recorded solid results and we benefited from the investments that we have made in our interstate pipeline and field services segments. The continued stability of our regulated utilities, together with opportunities to invest in energy infrastructure projects, position us well for the future."

For the six months ended June 30, 2010, net income was $195 million, or $0.49 per diluted share, compared to $153 million, or $0.44 per diluted share, for the same period of 2009. Operating income for the six months ended June 30, 2010, was $620 million compared to $538 million for the same period of 2009.

OPERATING INCOME BY SEGMENT

Electric Transmission & Distribution

The electric transmission & distribution segment reported operating income of $158 million for the second quarter of 2010, consisting of $122 million from the regulated electric transmission & distribution utility operations (TDU) and $36 million related to transition and system restoration bonds. Operating income for the second quarter of 2009 was $162 million, consisting of $129 million from the TDU and $33 million related to transition bonds. Operating income for the TDU benefited from growth of over 21,000 metered customers since June 2009 and slightly higher usage, which were more than offset by increased operation and maintenance expenses, in part due to higher labor and benefit costs, higher net transmission costs and reduced revenue associated with a credit to customers' bills to reflect the benefit of deferred taxes after Hurricane Ike.

Operating income for the six months ended June 30, 2010, was $265 million, consisting of $193 million from the TDU and $72 million related to transition and system restoration bonds. Operating income for the same period of 2009 was $232 million, consisting of $166 million from the TDU and $66 million related to transition bonds.

Natural Gas Distribution

The natural gas distribution segment reported operating income of $10 million for the second quarter of 2010 compared to $2 million for the same period of 2009. Operating income benefited from rate changes, higher non-volumetric revenues and lower operation and maintenance expenses resulting primarily from reduced bad debt expense. These benefits were partially offset by lower system throughput.

Operating income for the six months ended June 30, 2010, was $149 million compared to $120 million for the same period of 2009.

Interstate Pipelines

The interstate pipelines segment reported operating income of $67 million for the second quarter of 2010 compared to $61 million for the same period of 2009. Operating income increased due to higher revenue from new firm contracts primarily associated with Phase IV of the Carthage to Perryville pipeline as well as lower operation and maintenance expenses, partially offset by reduced revenues from off-system sales and ancillary services.

In addition to operating income, this segment recorded equity income of $4 million for the second quarter of 2010 primarily from its 50 percent interest in the Southeast Supply Header (SESH) compared to $9 million for the second quarter of 2009, which included $5 million related to a reduction in estimated property tax and a one-time fee received in connection with the construction of the pipeline.

Operating income for the six months ended June 30, 2010, was $139 million compared to $130 million for the same period of 2009. In addition to operating income, this segment recorded equity income of $7 million for the six months ended June 30, 2010 primarily from its 50 percent interest in the Southeast Supply Header (SESH) compared to $7 million for the six months ended June 30, 2009, which included a non-cash charge of $5 million to reflect SESH's discontinued use of regulatory accounting and $5 million related to a property tax reduction and a one-time receipt of a construction fee.

Field Services

The field services segment reported operating income of $31 million for the second quarter of 2010 compared to $23 million for the same period of 2009. Revenue growth from higher gathering volumes and higher commodity prices was partially offset by increased operation and maintenance expenses primarily related to facility expansions.

In addition to operating income, this business had equity income of $3 million in the second quarter of 2010 compared to $2 million in the second quarter of 2009 from its 50 percent interest in a gas processing plant.

Operating income for the six months ended June 30, 2010, was $54 million compared to $49 million for the same period of 2009. Equity income from the jointly-owned gas processing plant was $5 million for the six months ended June 30, 2010, compared to $4 million for the same period of 2009.

Competitive Natural Gas Sales and Services

The competitive natural gas sales and services segment reported an operating loss of $6 million for the second quarter of 2010 compared to operating income of $6 million for the same period of 2009. Operating income for the second quarter of 2010 included charges of $8 million resulting from mark-to-market accounting for derivatives associated with certain forward natural gas purchases and sales used to lock in economic margins compared to gains of $3 million for the same period of 2009.

Operating income for the six months ended June 30, 2010, was $9 million compared to $8 million for the same period of 2009. Operating income for the six months ended June 30, 2010, included charges of $5 million resulting from mark-to-market accounting compared to charges of $16 million for the same period of 2009. The six months ended June 30, 2009 also included a $6 million write-down of natural gas inventory to the lower of average cost or market.

DIVIDEND DECLARATION

On July 22, 2010, CenterPoint Energy's board of directors declared a regular quarterly cash dividend of $0.195 per share of common stock payable on September 10, 2010, to shareholders of record as of the close of business on August 16, 2010.

OUTLOOK REAFFIRMED FOR 2010

CenterPoint Energy reaffirmed its 2010 earnings guidance of $1.02 to $1.12 per diluted share. This guidance takes into consideration performance to date, equity issuances and various economic and operational assumptions related to the business segments in which the company operates. The company has made certain assumptions regarding the timing and cost of financing activities and the impact to earnings of various regulatory proceedings. In providing this guidance, the company has not included the impact of any changes in accounting standards, increased taxes recorded in the first quarter of 2010 as a result of recent health care legislation, any impact from acquisitions or divestitures, the timing effects of mark-to-market or inventory accounting in the company's competitive natural gas sales and services business, or the outcome of the TDU's true-up appeal. The company has also excluded any impact to income from the change in value of Time Warner stocks and the related ZENS securities. For the impact of these factors on the company's earnings for the three months and six months ended June 30, 2010, see the reconciliation below.

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 June 30, 2010. 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 with 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, August 4, 2010, 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 8,800 employees, CenterPoint Energy and its predecessor companies have been in business for more than 135 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 the company's earnings outlook for 2010 and 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 natural gas and natural gas liquids prices, the impact of unplanned facility outages, and other factors discussed in CenterPoint Energy's and its subsidiaries' Forms 10-K for the fiscal year ended December 31, 2009, CenterPoint Energy's and its subsidiaries' Forms 10-Q for the period ended March 31, 2010, CenterPoint Energy's Form 10-Q for the period ended June 30, 2010, and other filings with the SEC.


    For more information contact
    Media:
    Leticia Lowe
    Phone  713.207.7702
    Investors:
    Marianne Paulsen
    Phone  713.207.6500



                          CenterPoint Energy, Inc. and Subsidiaries

    Reconciliation of reported Net Income and diluted EPS to the basis
    used in providing annual earnings guidance


                               Quarter Ended           Six Months Ended
                               June 30, 2010            June 30, 2010
                               -------------            -------------
                             Net                     Net
                           Income          EPS     Income          EPS
                          -------          ---    -------          ---
                             (in                     (in
                          millions)               millions)
    As reported                 $81        $0.20       $195         $0.49
      Timing effects
       impacting CES(1):
        Mark-to-market
         (gains) losses -
         natural gas
         derivative
         contracts                5       0.01        3        0.01
        Natural gas
         inventory write-
         downs                    -            -          -             -
      ZENS-related mark-
       to-market (gains)
       losses:
        Marketable
         securities(2)           14         0.04        (10)        (0.02)
        Indexed debt
         securities             (21)       (0.05)        (3)        (0.01)
      Tax impact of
       federal health
       care legislation           -            -         21          0.05
                                ---          ---        ---          ----
    Per the basis used
     in providing
     annual earnings
     guidance                   $79        $0.20       $206         $0.52
                                ===        =====       ====         =====

    (1)  Competitive
     natural gas sales
     and services
    (2)  Time Warner
     Inc., Time Warner
     Cable Inc. and AOL
     Inc.



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


                                            Quarter            Six Months
                                             Ended                Ended
                                           June 30,             June 30,
                                           --------             --------
                                       2009       2010   2009        2010
                                       ----       ----   ----        ----

    Revenues:
        Electric Transmission &
         Distribution                  $521       $562   $933      $1,044
        Natural Gas Distribution        518        465  1,939       2,002
        Competitive Natural Gas Sales
         and Services                   432        560  1,197       1,412
        Interstate Pipelines            155        148    308         286
        Field Services                   56         80    113         148
        Other Operations                  3          3      6           6
        Eliminations                    (45)       (62)   (90)       (119)
           Total                      1,640      1,756  4,406       4,779
                                      -----      -----  -----       -----

    Expenses:
        Natural gas                     710        778  2,499       2,713
        Operation and maintenance       398        410    811         824
        Depreciation and amortization   188        217    354         417
        Taxes other than income taxes    91         88    204         205
           Total                      1,387      1,493  3,868       4,159
                                      -----      -----  -----       -----
    Operating Income                    253        263    538         620
                                        ---        ---    ---         ---

    Other Income (Expense) :
        Gain (loss) on marketable
         securities                      55        (22)    21          16
        Gain (loss) on indexed debt
         securities                     (46)        32    (24)          5
        Interest and other finance
         charges                      (129)      (121)  (258)        (243)
        Interest on transition and
         system restoration bonds       (33)       (36)   (66)        (72)
        Equity in earnings of
         unconsolidated affiliates       11          7     11          12
        Other - net                      18          3     22           4
                                                          ---         ---
           Total                      (124)      (137)  (294)        (278)
                                       ----       ----   ----        ----

    Income Before Income Taxes          129        126    244         342

    Income Tax Expense                  (43)       (45)   (91)       (147)
                                        ---        ---    ---        ----

    Net Income                          $86        $81   $153        $195
                                        ===        ===   ====        ====




    Reference is made to the Notes to the Consolidated Financial Statements
    contained in the Annual 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)


                                                          Six Months
                               Quarter Ended                             Ended
                                 June 30,                 June 30,
                                 --------                 --------
                              2009         2010        2009         2010
                              ----         ----        ----         ----


      Basic Earnings
       Per Common
       Share                 $0.24        $0.20       $0.44        $0.49
                             =====        =====       =====        =====

      Diluted Earnings
       Per Common
       Share                 $0.24        $0.20       $0.44        $0.49
                             =====        =====       =====        =====

      Dividends
       Declared per
       Common Share         $0.190       $0.195       $0.38        $0.39

         Weighted Average
          Common Shares
          Outstanding
          (000):
        - Basic            352,461      399,515     346,660      396,203
        - Diluted          354,280      401,993     348,522      398,689


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

      Electric
       Transmission &
       Distribution:
        Electric
         Transmission
         and
         Distribution
         Operations           $129      $122     $166      $193
        Transition and
         System
         Restoration
         Bond Companies         33           36          66           72
           Total Electric
            Transmission &
            Distribution       162          158         232          265
      Natural Gas
       Distribution              2           10         120          149
      Competitive
       Natural Gas
       Sales and
       Services                  6           (6)          8            9
      Interstate
       Pipelines                61           67         130          139
      Field Services            23           31          49           54
      Other Operations          (1)           3          (1)           4

      Total                   $253         $263        $538         $620
                              ====         ====        ====         ====




     Reference is made to the Notes to the Consolidated Financial Statements
     contained in the Annual 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
                                            June 30,                % Diff
                                            --------
                                                                      Fav/
                                         2009            2010       (Unfav)
                                         ----            ----      --------
    Results of Operations:
    Revenues:
        Electric transmission and
         distribution utility            $432            $449             4%
        Transition and system
         restoration bond
         companies                         89             113            27%
                                          ---             ---
           Total                          521             562             8%
                                          ---             ---

    Expenses:
        Operation and maintenance         181             204          (13%)
        Depreciation and
         amortization                      69              71           (3%)
        Taxes other than income
         taxes                             53              52             2%
        Transition and system
         restoration bond
         companies                         56              77          (38%)
                                                          ---
           Total                          359             404          (13%)
                                          ---             ---
    Operating Income                     $162            $158           (2%)
                                         ====            ====

    Operating Income:
        Electric transmission and
         distribution operations         $129            $122           (5%)
        Transition and system
         restoration bond
         companies                         33              36             9%
                                                          ---
           Total Segment Operating
            Income                       $162            $158           (2%)
                                         ====            ====


    Electric Transmission &
     Distribution
    Operating Data:
    Actual MWH Delivered
        Residential                 6,831,444       7,064,276             3%
        Total                      19,840,955      20,173,782             2%

    Weather (average for
     service area):
    Percentage of 10-year
     average:
        Cooling degree days               108%            109%
        Heating degree days               112%             78%


    Number of metered
     customers -end of
     period:
        Residential                 1,846,908       1,866,699             1%
        Total                       2,092,209       2,113,695             1%



                                         Natural Gas Distribution
                                         ------------------------
                                         Quarter Ended
                                           June 30,               % Diff
                                           --------
                                                                      Fav/
                                         2009            2010       (Unfav)
                                         ----            ----      --------
    Results of Operations:
    Revenues                             $518            $465          (10%)
                                         ----            ----
    Expenses:
        Natural gas                       295             244            17%
        Operation and maintenance         152             144             5%
        Depreciation and
         amortization                      41              44           (7%)
        Taxes other than income
         taxes                             28              23            18%
           Total                          516             455            12%
    Operating Income                       $2             $10           400%
                                          ===             ===

    Natural Gas Distribution
     Operating Data:
    Throughput data in BCF
        Residential                        20              16          (20%)
        Commercial and Industrial          46              49             7%
           Total Throughput                66              65           (2%)
                                          ===             ===


    Weather (average for
     service area)
    Percentage of 10-year
     average:
        Heating degree days               109%             66%


    Number of customers -end
     of period:
        Residential                 2,961,941       2,973,013             -
        Commercial and Industrial     241,875         244,089             1%
           Total                    3,203,816       3,217,102             -
                                    =========       =========






                             Electric Transmission & Distribution
                             ------------------------------------
                                  Six Months Ended
                                      June 30,                      % Diff
                                      --------
                                                                      Fav/
                                   2009            2010             (Unfav)
                                   ----            ----            --------
    Results of
     Operations:
    Revenues:
        Electric
         transmission and
         distribution
         utility                   $778            $835                    7%
        Transition and
         system restoration
         bond companies             155             209                   35%
                                    ---             ---
           Total                    933           1,044                   12%
                                    ---           -----

    Expenses:
        Operation and
         maintenance                369             394                  (7%)
        Depreciation and
         amortization               137             144                  (5%)
        Taxes other than
         income taxes               106             104                    2%
        Transition and
         system restoration
         bond companies              89             137                 (54%)
                                    ---             ---
           Total                    701             779                 (11%)
                                    ---             ---
    Operating Income               $232            $265                   14%
                                   ====            ====

    Operating Income:
        Electric
         transmission and
         distribution
         operations                $166            $193                   16%
        Transition and
         system restoration
         bond companies              66              72                    9%
                                    ---             ---
           Total Segment
            Operating Income       $232            $265                   14%
                                   ====            ====


    Electric
     Transmission &
     Distribution
    Operating Data:
    Actual MWH Delivered
        Residential          10,797,963      12,237,273                   13%
        Total                34,983,263      36,610,092                    5%

    Weather (average for
     service area):
    Percentage of
     10-year average:
        Cooling degree days         109%             99%
        Heating degree days          89%            160%


    Number of metered
     customers -end of
     period:
        Residential           1,846,908       1,866,699                    1%
        Total                 2,092,209       2,113,695                    1%



                                 Natural Gas Distribution
                                 ------------------------
                             Six Months Ended
                                June 30,                % Diff
                                --------
                                   2009            2010          Fav/(Unfav)
                                   ----            ----          -----------
    Results of
     Operations:
    Revenues                     $1,939          $2,002                    3%
                                 ------          ------
    Expenses:
        Natural gas               1,340           1,383                  (3%)
        Operation and
         maintenance                321             311                    3%
        Depreciation and
         amortization                81              84                  (4%)
        Taxes other than
         income taxes                77              75                    3%
           Total                  1,819           1,853                  (2%)
    Operating Income               $120            $149                   24%
                                   ====            ====

    Natural Gas
     Distribution
     Operating Data:
    Throughput data in
     BCF
        Residential                  98             112                   14%
        Commercial and
         Industrial                 123             136                   11%
           Total Throughput         221             248                   12%
                                    ===             ===


    Weather (average for
     service area)
    Percentage of
     10-year average:
        Heating degree days         103%            111%


    Number of customers
     -end of period:
        Residential           2,961,941       2,973,013                    -
        Commercial and
         Industrial             241,875         244,089                    1%
           Total              3,203,816       3,217,102                    -
                              =========       =========






     Reference is made to the Notes to the Consolidated Financial Statements
     contained in the Annual 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
                                  ------------------------------------------
                                       Quarter Ended
                                         June 30,               % Diff
                                         --------
                                                               Fav/
                                     2009         2010       (Unfav)
                                     ----         ----      --------
    Results of Operations:
    Revenues                         $432         $560             30%
                                     ----         ----
    Expenses:
        Natural gas                   414          554           (34%)
        Operation and maintenance      10           10              -
        Depreciation and
         amortization                   1            1              -
        Taxes other than income
         taxes                          1            1              -
           Total                      426          566           (33%)
    Operating Income (Loss)            $6          $(6)         (200%)
                                      ===          ===

    Competitive Natural Gas
     Sales and Services
     Operating Data:
    Throughput data in BCF            114          128             12%
                                      ===          ===

    Number of customers -end
     of period                     10,878       11,694              8%
                                   ======       ======



                                        Interstate Pipelines
                                        --------------------
                                     Quarter Ended
                                       June 30,             % Diff
                                       --------
                                                               Fav/
                                     2009         2010       (Unfav)
                                     ----         ----      --------
    Results of Operations:
    Revenues                         $155         $148            (5%)
                                     ----         ----
    Expenses:
        Natural gas                    34           24             29%
        Operation and maintenance      41           35             15%
        Depreciation and
         amortization                  12           13            (8%)
        Taxes other than income
         taxes                          7            9           (29%)
           Total                       94           81             14%
    Operating Income                  $61          $67             10%
                                      ===          ===


    Pipelines Operating Data:
    Throughput data in BCF
        Transportation                396          400              1%
                                      ===          ===





                                  Competitive Natural Gas Sales and Services
                                  ------------------------------------------
                                     Six Months Ended
                                         June 30,               % Diff
                                         --------
                                                               Fav/
                                     2009         2010       (Unfav)
                                     ----         ----      --------
    Results of Operations:
    Revenues                       $1,197       $1,412             18%
                                   ------       ------
    Expenses:
        Natural gas                 1,166        1,380           (18%)
        Operation and maintenance      20           19              5%
        Depreciation and
         amortization                   2            2              -
        Taxes other than income
         taxes                          1            2          (100%)
           Total                    1,189        1,403           (18%)
    Operating Income (Loss)            $8           $9             13%
                                      ===          ===

    Competitive Natural Gas
     Sales and Services
     Operating Data:
    Throughput data in BCF            255          269              5%
                                      ===          ===

    Number of customers -end
     of period                     10,878       11,694              8%
                                   ======       ======



                                  Interstate Pipelines
                                  --------------------
                                   Six Months Ended
                                       June 30,             % Diff
                                       --------
                                                               Fav/
                                     2009         2010       (Unfav)
                                     ----         ----      --------
    Results of Operations:
    Revenues                         $308         $286            (7%)
                                     ----         ----
    Expenses:
        Natural gas                    63           34             46%
        Operation and maintenance      76           70              8%
        Depreciation and
         amortization                  24           26            (8%)
        Taxes other than income
         taxes                         15           17           (13%)
           Total                      178          147             17%
    Operating Income                 $130         $139              7%
                                     ====         ====


    Pipelines Operating Data:
    Throughput data in BCF
        Transportation                857          838            (2%)
                                      ===          ===




     Reference is made to the Notes to the Consolidated Financial Statements
     contained in the Annual 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
                                                         --------------
                                                     Quarter
                                                      Ended
                                                    June 30,            % Diff
                                                    --------
                                                                        Fav/
                                                2009      2010        (Unfav)
                                                ----      ----       --------
    Results of Operations:
    Revenues                                     $56       $80             43%
                                                 ---       ---
    Expenses:
        Natural gas                               11        18           (64%)
        Operation and maintenance                 18        25           (39%)
        Depreciation and amortization              3         5           (67%)
        Taxes other than income taxes              1         1              -
           Total                                  33        49           (48%)
    Operating Income                             $23       $31             35%
                                                 ===       ===


    Field Services Operating Data:
    Throughput data in BCF
        Gathering                                102       156             53%
                                                 ===       ===


                                                     Other Operations
                                                     ----------------
                                                   Quarter
                                                    Ended
                                                  June 30,          % Diff
                                                  --------
                                                                        Fav/
                                                2009      2010        (Unfav)
                                                ----      ----       --------
    Results of Operations:
    Revenues                                      $3        $3              -
    Expenses                                       4         -            100%
    Operating Income (Loss)                      $(1)       $3            400%
                                                 ===       ===





                Capital Expenditures by Segment
                    (Millions of Dollars)
                         (Unaudited)

                                                   Quarter
                                                    Ended
                                                  June 30,
                                                  --------
                                                2009      2010
                                                ----      ----
    Capital Expenditures by Segment
        Electric Transmission & Distribution    $108      $101
        Hurricane Ike                              2         -
                                                 ---       ---
         Total Electric Transmission &
          Distribution                           110       101
        Natural Gas Distribution                  43        45
        Competitive Natural Gas Sales and
         Services                                  -         1
        Interstate Pipelines                      27        32
        Field Services                            66       220
        Other Operations                           2         3
           Total                                $248      $402
                                                ====      ====




                    (Millions of Dollars)
                         (Unaudited)

                                                   Quarter
                                                    Ended
                                                  June 30,
                                                  --------
                                                2009      2010
                                                ----      ----
    Interest Expense Detail
        Amortization of Deferred Financing Cost   $9        $5
        Capitalization of Interest Cost           (1)       (2)
        Transition and System Restoration Bond
         Interest Expense                         33        36
        Other Interest Expense                   121       118
           Total Interest Expense               $162      $157
                                                ====      ====





                                                     Field Services
                                                     --------------
                                                  Six Months Ended
                                                      June 30,          % Diff
                                                      --------
                                                                        Fav/
                                                  2009        2010    (Unfav)
                                                  ----        ----   --------
    Results of Operations:
    Revenues                                      $113        $148         31%
                                                  ----        ----
    Expenses:
        Natural gas                                 18          34       (89%)
        Operation and maintenance                   37          46       (24%)
        Depreciation and amortization                7          11       (57%)
        Taxes other than income taxes                2           3       (50%)
           Total                                    64          94       (47%)
    Operating Income                               $49         $54         10%
                                                   ===         ===


    Field Services Operating Data:
    Throughput data in BCF
        Gathering                                  206         284         38%
                                                   ===         ===


                                                  Other Operations
                                                  ----------------
                                                Six Months Ended
                                                    June 30,        % Diff
                                                    --------
                                                                        Fav/
                                                  2009        2010    (Unfav)
                                                  ----        ----   --------
    Results of Operations:
    Revenues                                        $6          $6          -
    Expenses                                         7           2         71%
    Operating Income (Loss)                        $(1)         $4        500%
                                                   ===         ===





                Capital Expenditures by Segment
                    (Millions of Dollars)
                         (Unaudited)

                                                Six Months Ended
                                                    June 30,
                                                    --------
                                                  2009        2010
                                                  ----        ----
    Capital Expenditures by Segment
        Electric Transmission & Distribution      $189        $196
        Hurricane Ike                               18           -
                                                   ---         ---
         Total Electric Transmission &
          Distribution                             207         196
        Natural Gas Distribution                    77          74
        Competitive Natural Gas Sales and
         Services                                    1           1
        Interstate Pipelines                        74          40
        Field Services                             104         341
        Other Operations                             9           7
           Total                                  $472        $659
                                                  ====        ====




                    (Millions of Dollars)
                         (Unaudited)

                                                Six Months Ended
                                                    June 30,
                                                    --------
                                                  2009        2010
                                                  ----        ----
    Interest Expense Detail
        Amortization of Deferred Financing Cost    $18         $12
        Capitalization of Interest Cost             (3)         (3)
        Transition and System Restoration Bond
         Interest Expense                           66          72
        Other Interest Expense                     243         234
           Total Interest Expense                 $324        $315
                                                  ====        ====




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

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


                                                            December  June
                                                               31,     30,
                                                                2009    2010
                                                                ----    ----


                            ASSETS
    Current Assets:
      Cash and cash equivalents                                 $740    $583
      Other current assets                                     2,164   1,769
          Total current assets                                 2,904   2,352
                                                               -----   -----

    Property, Plant and Equipment, net                        10,788  11,217
                                                              ------  ------

    Other Assets:
      Goodwill                                                 1,696   1,696
      Regulatory assets                                        3,677   3,540
      Other non-current assets                                   708     716
          Total other assets                                   6,081   5,952
            Total Assets                                     $19,773 $19,521
                                                             ======= =======

             LIABILITIES AND SHAREHOLDERS' EQUITY

    Current Liabilities:
      Short-term borrowings                                      $55     $32
      Current portion of transition and system restoration
       bonds long-term debt                                      241     274
      Current portion of indexed debt                            121     124
      Current portion of other long-term debt                    541     769
      Other current liabilities                                2,080   1,833
          Total current liabilities                            3,038   3,032
                                                               -----   -----

    Other Liabilities:
      Accumulated deferred income taxes, net and investment
       tax credit                                              2,792   2,786
      Regulatory liabilities                                     921     967
      Other non-current liabilities                            1,264   1,265
          Total other liabilities                              4,977   5,018
                                                               -----   -----

    Long-term Debt:
      Transition and system restoration bonds                  2,805   2,665
      Other                                                    6,314   5,745
          Total long-term debt                                 9,119   8,410
                                                               -----   -----

    Shareholders' Equity                                       2,639   3,061
          Total Liabilities and Shareholders' Equity         $19,773 $19,521
                                                             ======= =======



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

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


                                                       Six Months Ended
                                                           June 30,
                                                       ----------------
                                                       2009         2010
                                                       ----         ----

    Cash Flows from Operating Activities:
      Net income                                       $153         $195
      Adjustments to reconcile net income to net cash
       provided by operating activities:
        Depreciation and amortization                   374          431
        Deferred income taxes                            78          (37)
        Write-down of natural gas inventory               6            -
        Changes in net regulatory assets                 19           26
        Changes in other assets and liabilities         422          195
        Other, net                                        4            8
    Net Cash Provided by Operating Activities         1,056          818

    Net Cash Used in Investing Activities              (504)        (719)

    Net Cash Used in Financing Activities              (568)        (256)
                                                       ----         ----

    Net Decrease in Cash and Cash Equivalents           (16)        (157)

    Cash and Cash Equivalents at Beginning of Period    167          740

    Cash and Cash Equivalents at End of Period         $151         $583
                                                       ====         ====



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

SOURCE CenterPoint Energy, Inc.

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