Southern Company

1st Quarter 2004 Earnings

March 31, 2004

ContentsPress Release 1Business Outlook 4Financial Highlights 8Factors Affecting Earnings 8Analysis of Consolidated Earnings 9Kilowatt Hour Sales 9Financial Overview 10

News

Media Contact: Marc Rice 404-506-5333 or 1-866-506-5333 media@southerncompany.com www.southerncompany.com Investor Relations Contact:

Glen Kundert 404-506-5135 gakunder2@southernco.com

April 28, 2004

Southern Company earnings rise in first quarter

ATLANTA – Southern Company today reported first quarter earnings of $331 million, or 45 cents a share. The solid performance was marked by continued customer growth, increased residential energy use and, primarily in Alabama, an ongoing rebound and expansion in demand for electricity in the industrial sector. The earnings compared with $298 million, or 41 cents a share, in the first quarter of 2003. With its business focused in the Southeast, one of the nation’s fastest-growing regions, Southern Company is serving an increasing number of customers. Total customers increased by 71,000, or 1.7 percent, since March 2003. Meanwhile, year-to-year electricity sales to industrial customers rose for the second consecutive quarter following an extended downturn. Renewed strength, especially in Alabama’s steel and automobile sectors, contributed to a 5 percent increase in industrial energy use, compared with the first quarter a year ago. “We were encouraged by the growth in our overall customer base and the economic trends reflected in the improved industrial sales. Most important, our people responded by reliably serving the increased demand for energy in the first quarter,” said CEO Allen Franklin.

“Our commitment to successfully execute our strategy to deliver long-term shareholder value and customer satisfaction remains strong,” Franklin added. Revenues for the first quarter were $2.75 billion, compared with $2.55 billion in the first quarter of 2003, an increase of 8.1 percent. Kilowatt-hour sales to retail customers in Southern Company's four-state service area increased 4.5 percent in the first quarter, compared with the same period in 2003. Residential electricity use increased 5.3 percent. Electricity use by commercial customers -- offices, stores and other non-manufacturing firms – increased 3.4 percent. Industrial energy use increased 5.0 percent. Total sales of electricity to Southern Company's customers in the Southeast, including wholesale sales, increased 3.1 percent in the first quarter, compared with the first quarter last year. In conjunction with this earnings announcement, Southern Company has posted on its Web site a package of detailed financial information on its first quarter performance. These materials are available at 7:30 a.m. EDT April 28 at www.southerncompany.com. Southern Company's financial analyst call will be at 1 p.m. EDT April 28, at which time Franklin and Chief Financial Officer Tom Fanning will discuss earnings and earnings guidance as well as a general business update. Investors, media and the public may listen to a live Webcast of the call at www.southerncompany.com. A replay of the Webcast will be available at the site for 12 months. With 4 million customers and nearly 39,000 megawatts of generating capacity, Atlanta-based Southern Company (NYSE: SO) is the premier super-regional energy company in the Southeast and a leading U.S. producer of electricity. Southern Company owns electric utilities in four states, a growing competitive generation company, an energy services business and a competitive retail natural gas business, as well as fiber optics and wireless communications. Southern Company brands are known for excellent customer service, high reliability and retail electric prices that are 15 percent below the national average. Southern Company has been named three consecutive years No. 1 on Fortune magazine’s “America’s Most Admired Companies” list in the Electric and Gas Utility industry. Southern Company has been ranked the nation’s top energy utility in the American Customer Satisfaction Index four years in a row, and in the latest survey tied for the highest score among all service industry companies. Southern Company has more than 500,000 shareholders, making its common stock one of the most widely held in the United States. Visit the Southern Company Web site at www.southerncompany.com. Forward Looking Statements Note: Certain information contained in this release is forward-looking information based on current expectations and plans that involve risks and uncertainties. Forward-looking information includes, among other things, statements concerning continued customer growth and Southern Company’s ability to achieve long-term success. Southern

Company cautions that there are certain factors that can cause actual results to differ materially from the forward-looking information that has been provided. The reader is cautioned not to put undue reliance on this forward-looking information, which is not a guarantee of future performance and is subject to a number of uncertainties and other factors, many of which are outside the control of Southern Company; accordingly, there can be no assurance that such indicated results will be realized. The following factors, in addition to those discussed in Southern Company's Annual Report on Form 10-K for the year ended Dec. 31, 2003, and subsequent securities filings, could cause results to differ materially from management expectations as suggested by such forward-looking information: the impact of recent and future federal and state regulatory change, including legislative and regulatory initiatives regarding deregulation and restructuring of the electric utility industry, and also changes in environmental, tax and other laws and regulations to which Southern Company and its subsidiaries are subject, as well as changes in application of existing laws and regulations; current and future litigation, regulatory investigations, proceedings or inquiries, including the pending EPA civil actions against certain Southern Company subsidiaries and current IRS audits; the effects, extent and timing of the entry of additional competition in the markets in which Southern Company’s subsidiaries operate; the impact of fluctuations in commodity prices, interest rates and customer demand; available sources and costs of fuels; ability to control costs; investment performance of Southern Company’s employee benefit plans; advances in technology; state and federal rate regulations and pending and future rate cases and negotiations; effects of, and changes in, political, legal and economic conditions and developments in the United States, including the current state of the economy; the performance of projects undertaken by the non-traditional business and the success of efforts to invest in and develop new opportunities; internal restructuring or other restructuring options that may be pursued; potential business strategies, including acquisitions or dispositions of assets or businesses, which cannot be assured to be completed or beneficial to Southern Company or its subsidiaries; the ability of counterparties of Southern Company and its subsidiaries to make payments as and when due; the direct or indirect effect on Southern Company’s business resulting from the terrorist incidents on Sept. 11, 2001, or any similar incidents or responses to such incidents; financial market conditions and the results of financing efforts, including Southern Company’s and its subsidiaries’ credit ratings; the ability of Southern Company and its subsidiaries to obtain additional generating capacity at competitive prices; weather and other natural phenomena; the direct and indirect effects on Southern Company’s business resulting from the August 2003 power outage in the Northeast, or any similar incidents; and the effect of accounting pronouncements issued periodically by standard-setting bodies.

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Page 4

See caution regarding forward looking statements on page seven of this document

Southern Company Business Outlook A Strategy focused on the business, markets and customers we know best

1. Regulated retail business

− Transmission, distribution, and over 34,000 MW of regulated generation within our five operating companies.

− More than 4 million utility customers in Alabama, Georgia, Florida and

Mississippi.

− Annual revenues of over $11 billion and approximately 26,000 employees.

− Average long term demand growth in our service territory projected to be 2 percent.

− Average long term customer growth projected to be 1.5 percent per year.

2. Competitive wholesale generation business

− Strategically focused on competitive wholesale energy business in the Super

Southeast.

− Competitive wholesale generation net income includes Southern Power Company’s results in addition to the existing wholesale businesses in our five operating companies.

− 4,777 MW of capacity owned by Southern Power Company. − Current construction schedule includes 1,240 MW of capacity scheduled to be

in service in June 2005. Goals for our Major Businesses

1. Lead the industry in service and customer satisfaction.

2. Earn superior risk adjusted returns. 3. Earn net income of at least $300 million from the company’s competitive

wholesale generation business by 2007.

Page 5

See caution regarding forward looking statements on page seven of this document

Financial Goals for the Company

1. Earnings per Share Growth – 5% average long term growth 2. Return on Equity – top quartile of electric utilities 3. Dividend Payout – target 70%

4. Dividend Growth – consistent with our payout objectives

5. Capital Structure – maintain common equity ratio of approximately 40%

2004 EPS Guidance: $1.94 - $1.99

This range is based on our 5% average long term growth target and provides for normal variability which might result from:

• Moderate weather variances • Changes in energy prices • Economic recovery (reflected in industrial sales and customer growth) • Other items within the scope of normal operations

Projected Sources and Uses of Funds from 2004 to 2006

Sources 2004-2006 ($ Billions)Funds from Operations $9.0Equity Issuances 0.1Net Debt and Preferred 1.1 $10.2Uses Capital Expenditures: Detailed Breakout Page 6

$7.0

Common Dividends 3.2 $10.2

Page 6

See caution regarding forward looking statements on page seven of this document

Projected Capital Expenditures 2004 – 2006 ($ Billions) Regulated Infrastructure Fossil/Hydro Retrofits 0.7 Environmental 1.4 Nuclear Fuel & Retrofits 0.5 Transmission & Distribution 3.0 All Other 0.4 Total Regulated Infrastructure $6.0 Competitive Generation 0.9 Products/Services & Other 0.1 Total Capital Expenditures $ 7.0

Credit Ratings S & P Moody’s Fitch Senior

Unsecured Commercial

Paper Senior

Unsecured Commercial

Paper Senior

Unsecured Commercial

Paper Alabama Power A A-1** A2 P-1** A F-1** Georgia Power A A-1* A2 P-1* A+ F-1* Gulf Power A A-1* A2 P-1* A F-1* Mississippi Power A A-1* A1 P-1* A+ F-1* Savannah Electric A A-1* A2 P-1* - - Southern Power BBB+ A-2 Baa1 P-2 - - Southern Company A- A-1 A3 P-1 A F-1 *Commercial Paper issued through Southern Company Funding Corporation **Alabama Power can issue commercial paper through the Southern Company Funding Corporation or through its own commercial paper program.

Page 7 Forward Looking Statement Disclosure:

NOTE: All of the information contained in this Business Outlook is forward-looking information based on current expectations and plans that involve risks and uncertainties. Southern Company cautions that there are certain factors that can cause actual results to differ materially from the forward-looking information that has been provided. The reader is cautioned not to put undue reliance on this forward-looking information, which is not a guarantee of future performance and is subject to a number of uncertainties and other factors, many of which are outside the control of Southern Company; accordingly, there can be no assurance that such indicated results will be realized.

The following factors, in addition to those discussed in Southern Company’s Annual Report on Form 10-K for the year ended Dec. 31, 2003, and subsequent securities filings, could cause results to differ materially from management expectations as suggested by such forward-looking information: the impact of recent and future federal and state regulatory change, including legislative and regulatory initiatives regarding deregulation and restructuring of the electric utility industry, and also changes in environmental, tax and other laws and regulations to which Southern Company and its subsidiaries are subject, as well as changes in application of existing laws and regulations; current and future litigation, regulatory investigations, proceedings or inquiries, including the pending EPA civil actions against certain Southern Company subsidiaries and current IRS audits; the effects, extent and timing of the entry of additional competition in the markets in which Southern Company’s subsidiaries operate; the impact of fluctuations in commodity prices, interest rates and customer demand; available sources and costs of fuels; ability to control costs; investment performance of Southern Company’s employee benefit plan; advances in technology; state and federal rate regulations and pending and future rate cases and negotiations; effects of, and changes in, political, legal and economic conditions and developments in the United States, including the current soft state of the economy; the performance of projects undertaken by the non-traditional business and the success of efforts to invest in and develop new opportunities; internal restructuring or other restructuring options that may be pursued; potential business strategies, including acquisitions or dispositions of assets or businesses, which cannot be assured to be completed or beneficial to Southern Company or its subsidiaries; the ability of counterparties of Southern Company and its subsidiaries to make payments as and when due; the direct or indirect effect on Southern Company’s business resulting from the terrorist incidents on September 11, 2001, or any similar such incidents or responses to such incidents; financial market conditions and the results of financing efforts, including Southern Company’s and its subsidiaries’ credit ratings; the ability of Southern Company and its subsidiaries to obtain additional generating capacity at competitive prices; weather and other natural phenomena; the direct or indirect effects on Southern Company’s business resulting from the August 2003 power outage in the Northeast, or any similar such incidents; and the effect of accounting pronouncements issued periodically by standard-setting bodies.

Page 8Southern CompanyFinancial Highlights

(In Millions of Dollars Except Earnings Per Share)

2004 2003(Notes) (Notes)

Consolidated Earnings–(See Notes)

Retail Business 243$ 230$ Competitive Generation 56 55

Total 299 285 Synthetic Fuels 21 9 Leasing Business 7 7 Parent Company and Other 4 (3) Net Income 331$ 298$

Basic Earnings Per Share–(Notes) 0.45$ 0.41$

Operating Revenues 2,755$ 2,548$ Average Shares Outstanding (in millions) 737 719 End of Period Shares Outstanding (in millions) 737 721

Significant Factors Impacting EPS (Notes)

2004 2003 Change

Consolidated Earnings- $0.45 $0.41 $0.04

Significant Factors:Retail Business 0.02 Competitive Generation - Synthetic Fuels 0.02 Leasing Business - Parent Company and Other 0.01 Impact of Additional Shares (0.01)

Total $0.04

Notes- As a result of using rounded numbers, the EPS for significant factors may not directly correspond

to the variance in millions of dollars shown above.- Diluted earnings per share are not more than 1 cent for any period reported above and are not material.- Certain prior year data has been reclassified to conform with current year presentation.- Information contained in this report is subject to review and adjustments and certain classifications may be different

from final results published in the Form 10-Q.

3 Months Ended March

3 Months Ended March

Page 9Southern CompanyAnalysis of Consolidated Earnings

(In Millions of Dollars)

3 Months Ended March2004 2003 Change

Income Account-Retail Revenue 2,144$ 1,974$ 170$ Wholesale Revenue 352 335 17 Other Electric Revenues 93 91 2 Non-regulated Operating Revenues 166 148 18 Total Revenues 2,755 2,548 207 Fuel and Purchased Power 928 825 103 Non-fuel O & M 774 724 50 Depreciation and Amortization 241 245 (4) Taxes Other Than Income Taxes 158 149 9 Total Operating Expenses 2,101 1,943 158 Operating Income 654 605 49 Other Income, net (30) (17) (13) Interest Charges and Dividends 170 169 1 Income Taxes 123 121 2 NET INCOME AS REPORTED 331$ 298$ 33$

Kilowatt-Hour Sales(In Millions of KWHs)

3 Months Ended March2004 2003 Change

Kilowatt-Hour Sales-Total Sales 45,785 44,407 3.1%

Total Retail Sales- 37,030 35,421 4.5%Residential 12,063 11,457 5.3%Commercial 11,298 10,927 3.4%Industrial 13,420 12,786 5.0%

Total Wholesale Sales 8,755 8,986 -2.6%

Page 10Southern CompanyFinancial Overview

(In Millions of Dollars)

3 Months Ended March2004 2003 % Change

Consolidated –Operating Revenues $2,755 $2,548 8.1%Earnings Before Income Taxes 454 419 8.5%Net Income As Reported 331 298 11.2%

Alabama Power –Operating Revenues $960 $890 7.8%Earnings Before Income Taxes 153 155 -1.4%Net Income Available to Common 91 92 -1.2%

Georgia Power –Operating Revenues $1,199 $1,126 6.5%Earnings Before Income Taxes 225 209 7.8%Net Income Available to Common 144 133 7.9%

Gulf Power –Operating Revenues $215 $198 8.6%Earnings Before Income Taxes 27 22 20.3%Net Income Available to Common 17 14 20.5%

Mississippi Power –Operating Revenues $210 $194 8.2%Earnings Before Income Taxes 29 35 -18.7%Net Income Available to Common 17 21 -19.1%

Savannah Electric –Operating Revenues $73 $69 5.7%Earnings Before Income Taxes 5 6 -10.1%Net Income Available to Common 3 4 -10.3%

Southern Power –Operating Revenues $176 $107 63.4%Earnings Before Income Taxes 44 37 19.4%Net Income Available to Common 27 23 17.6%