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	From:  Ann M Schmidt                           11/30/2000 05:52 PM
	

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Subject: CNBC Transcript - Street Signs

    
Date      November 30, 2000
Time      02:00 PM - 03:00 PM
Station   CNBC
Location  Network
Program   Street Signs


Maria Bartiromo, anchor:
Well there have been few winners over the past few weeks on Wall Street,
even some of the energy and utility companies, which were seen as safe
havens in the market sell-off, have been hit hard this week.  Enron is one
example.  Down fifteen percent in a week alone.  Take a look at this chart
over the last couple of days.  And we see Enron down today by nine percent.
And it has begun falling.  Since Tuesday or so it's been going down.
(Graphic:  Enron Corp (ENE) 63.94 down 6.38 1-week stock chart)  Joining us
now to discuss this company and the sector is Jeff Skilling, Enron's
president.
Mr. Skilling, good to have you with us.
Jeffrey Skilling (President, Enron):  Well thank you for inviting me on on
such a positive uplifting day, Maria.
Bartiromo:  Maybe you can make it a little more positive and uplifting for
us.  How's business?
Skilling:  Business is great.  If you look at our key energy businesses, our
wholesale and retail energy business, year-to-date, our volumes-which really
dictates our profitability in our wholesale business-are up about sixty
percent versus last year.  In our retail energy business we're up a hundred
percent in contracting.  You know, we've said earnings were on track for the
fourth quarter at thirty-five cents, which is a twenty-percent
year-over-year gain in net income.  (Graphic:  Enron Corp (ENE) 63.88 down
6.44 1-year stock chart)  So business is great.
Bartiromo:  So you think Wall Street has it wrong?  What's wrong with the
stock over the last week or so?
Skilling:  Well, you know, I think-my own opinion on this is that you-you
have a lot of people that are just uncomfortable with the general
environment, you know, the presidential election, people are starting to get
concerned about how slowdown in growth of the economy will-will impact
certain companies.  But I think you have a bunch of portfolio managers with
their hair on fire running around.  And, you know, it's kind of ready, fire,
aim.
Bartiromo:  Right.
Skilling:  But I think as time goes on and people see the fundamentals,
particularly of our business, and where we stand in the industry and growth
prospects for the future, you know, I'm convinced it's going-it's going to
bounce right back.
Bartiromo:  And part of your business, of course, is trading.  Your Enron
on-line, one year this week, is that right?
Skilling:  One year this week.  And it's been a huge success.  We're up to
over two hundred fifty billion dollars-billion dollars in transactions.
It's the largest-Web-based transaction site in the world.  In fact,
yesterday we did over four billion dollars-yesterday alone.  So, you know,
we made a tremendous transition into the new-new Internet-based business.
It's had a big impact on our growth rate, which has been very positive.
So-and...
Bartiromo:  Right.
Skilling:  ...then the stock's down.  So what do you do?
Bartiromo:  So-so you're basically making money regardless of the price of
oil because you're-you're trading it?
Skilling:  Yeah.
Bartiromo:  It doesn't really matter if oil prices are high or low, in your
opinion.
Skilling:  Well if-if you really get down to what we sell customers wou-what
our customers are buying from Enron is reliable delivery and predictable
prices.  And when you have this kind of volatility in the energy markets
that you see, particularly in places like California, that's what people
want to buy.  I mean, you know, the prospects for our business have never
been better.
Bartiromo:  Well let me ask you a question.  I mean, how is that been any
different than an investment bank?  I mean, you take a look at your
price-to-earnings ratio versus some of the investment banks and the
investment banks have been coming down quite significantly over the last six
months or so because of that trading that they do.  Now your company is
doing trading.  Sure, it's not trading stocks but would you compare yourself
to an investment bank?
Skilling:  No.  You know, it's-it's totally different.  If-if you think of
what we do-what we do is we put together packages, you know, we-we take
components of different energy pieces.  We put them together in packages for
our customers.  Now trading is a piece of that because you have to have
access to the markets for certain of those components (sic).  But where we
really create value for our customers is we put together a total energy
solution for them.  It's-it's-it's more like, I think, the analogy is better
that we're like Toyota versus General Motors.  You know, if you look at the
Exxons and Shells, big, vertically integrated companies, we do it much more
flexibly, lower costs than they do.  And that's why we've grown so much.
You know, our-over the last ten years, our wholesale business, which we
really started ten years ago, has grown at a compound rate of forty percent
a year since then.  I mean, that-consistently; year in and year out.  It's a
better business model.  And that's what's driving our-that's what's driving
our growth and driving our profitability.
Bartiromo:  What do you make of what's going on Washington these days?
There's been a lot of speculation that your CEO, Kenneth Lay, may join the
Bush campaign, if in fact Mr. Bush is our next president.  Is that true?
And what's your comments on what's going on right now.
Skilling:  Well I just-I was just talking to Kenny a couple of minutes ago
and-and what Ken said is that he has no intention of doing that at this
point.  And, you know, who knows what they'll ask-or who knows who the next
president's going to be, you know?  What I've said to him, You ought to do
some sort of a deal.  They ought to flip a coin for the president.  If it
comes down on the middle, they'll make him president and-and that would be
wonderful for everybody.
Bartiromo:  Jeff, how has this economic slowdown impacted your company?
Skilling:  It won't impact us at all, Maria.  It-it's kind of interesting
because we compete in the non-regulated portion of the energy markets and
broadband markets.  But unregulated portion of the energy markets.  So even
though overall energy is growing relatively slowly, the portion that's
deregulating-or that is deregulated, is growing by leaps and bounds.  If you
take the-the overall energy market in Europe, North America, and Japan, only
about twenty percent of that market has deregulated.  That will be a hundred
percent in five years.  So we should grow just hanging on to current market
share.  And we're growing on market share.  But if we just hang on to our
existing market share, we should grow by a factor of five just in the energy
markets.  And just to remind you, our sales last quarter were thirty billion
dollars.  So we're a hundred and thirty-a
hundred-and-twenty-billion-dollar-a-year sales clip company.  We've got
built-in growth of five times over the next five to ten years regardless of
what happens to the overall economy.  And I think as people start seeing
that and start seeing that opportunity, I think, you know, they're going to
come right back and the stock will be right back where-above where we were
before.
Bartiromo:  All right.  Good to have you with us.  Thanks so much.  Lots of
luck, Mr. Skilling.
Skilling:  Thank you, Maria.
Bartiromo:  Jeffrey Skilling, Enron's president, joining us live.

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