ALLETE, Inc. (NYSE:ALE) today reported second quarter 2012
earnings of 39 cents per share on net income of $14.4 million and
operating revenue of $216.4 million, compared to 48 cents on net
income of $17.0 million and operating revenue of $219.9 million in
2011.
Last year's results included a $2.9 million, or 8 cents per
share, income tax benefit. The non-recurring benefit resulted from
the Minnesota Public Utility Commission's approval to defer the
retail portion of a 2010 charge related to the Patient Protection
and Affordable Care Act.
ALLETE's Regulated Operations segment, which includes Minnesota
Power, Superior Water, Light & Power and the company's
investment in the American Transmission Company, recorded net
income of $14.4 million. The net income of $18.3 million
recorded in 2011 included the $2.9 million benefit described
above.
Second quarter 2012 results included higher current cost
recovery rider revenue, higher costs under the Square Butte power
purchase agreement and increased depreciation and interest expense
compared to the year-ago period. Total electric sales to Minnesota
Power's retail and municipal customers rose 1.9 percent compared to
a year ago; among industrial customers the increase was 3.4
percent.
“Industrial demand for power remains strong,” said ALLETE
Chairman, President and CEO Al Hodnik. “Based on the demand
nominations received this week, we expect these customers to run at
near full-capacity levels for the remainder of the year.”
ALLETE's Investments and Other segment broke even in the second
quarter, an improvement over the $1.3 million net loss recorded in
the second quarter of 2011. The difference was due primarily to
lower interest and state income tax expenses.
“Our year-to-date financial results are right where we expected
them to be, and we look forward to a strong second half of 2012,”
Hodnik said. “The company's full year earnings guidance remains
unchanged, in an expected range of between $2.45 and $2.65 per
share.” He said 2012 guidance assumes continued strong industrial
demand for electricity, increasing current cost recovery rider
revenue, and an approximate increase of five percent year-over-year
in operating and maintenance expense.
ALLETE will host a conference call and webcast at 10 a.m.
Eastern time today to discuss details of its quarterly financial
performance. Interested parties may listen live by calling (877)
303-5852, or by accessing the webcast at www.allete.com. A replay
of the call will be available through Aug. 4, 2012 by calling (855)
859-2056, pass code 96261080.
ALLETE, Inc. is an energy company headquartered in Duluth,
Minnesota. ALLETE's energy businesses include Minnesota Power,
Superior Water, Light & Power Co., BNI Coal, and ALLETE Clean
Energy. More information about the company is available at
www.allete.com.
The statements contained in this release and statements that
ALLETE may make orally in connection with this release that are not
historical facts, are forward-looking statements. Actual results
may differ materially from those projected in the forward-looking
statements. These forward-looking statements involve risks and
uncertainties and investors are directed to the risks discussed in
documents filed by ALLETE with the Securities and Exchange
Commission.
ALLETE’s press releases and other communications may include
certain non-Generally Accepted Accounting Principles (GAAP)
financial measures. A “non-GAAP financial measure” is defined as a
numerical measure of a company’s financial performance, financial
position or cash flows that excludes (or includes) amounts that are
included in (or excluded from) the most directly comparable measure
calculated and presented in accordance with GAAP in the company’s
financial statements.
Non-GAAP financial measures utilized by the Company include
presentations of earnings (loss) per share. ALLETE’s management
believes that these non-GAAP financial measures provide useful
information to investors by removing the effect of variances in
GAAP reported results of operations that are not indicative of
changes in the fundamental earnings power of the Company’s
operations. Management believes that the presentation of the
non-GAAP financial measures is appropriate and enables investors
and analysts to more accurately compare the company’s ongoing
financial performance over the periods presented.
ALLETE, Inc. Consolidated Statement of
Income
Millions Except Per Share Amounts –
Unaudited
Quarter Ended Six
Months Ended June 30, June 30,
2012 2011
2012 2011 Operating Revenue
$ 216.4 $ 219.9
$ 456.4 $ 462.1
Operating Expenses Fuel and Purchased Power
72.1 76.0 149.2 155.0 Operating and Maintenance 96.2 95.7 196.1
185.8 Depreciation 24.8
22.1 49.4
44.4 Total Operating Expenses 193.1 193.8 394.7 385.2
Operating Income 23.3
26.1 61.7
76.9
Other Income
(Expense) Interest Expense (10.1 ) (11.0 ) (21.1 ) (21.7 )
Equity Earnings in ATC 4.8 4.6 9.4 9.0 Other
1.2 1.0 1.9
1.8 Total Other Expense
(4.1 ) (5.4 )
(9.8 ) (10.9 )
Income Before
Non-Controlling Interest and Income Taxes 19.2 20.7 51.9 66.0
Income Tax Expense 4.8
3.8 13.1
12.0
Net Income
14.4 16.9
38.8 54.0 Less: Non-Controlling
Interest in Subsidiaries —
(0.1 ) —
(0.2 )
Net Income Attributable to ALLETE
$ 14.4 $ 17.0 $
38.8 $ 54.2
Average Shares of
Common Stock Basic 37.3 35.0 37.0 34.8 Diluted
37.4 35.1
37.1 34.9
Basic
Earnings Per Share of Common Stock $ 0.39 $ 0.49 $ 1.05 $ 1.56
Diluted Earnings Per Share of Common Stock $ 0.39 $ 0.48 $
1.05 $ 1.55
Dividends Per Share of Common Stock
$ 0.46 $ 0.445
$ 0.92 $ 0.89
Consolidated Balance Sheet
Millions – Unaudited
June 30, Dec. 31,
June 30,
Dec. 31, 2012
2011 2012
2011 Assets Liabilities and
Shareholders' Equity Cash and Short-Term Investments $ 8.6 $
101.1 Current Liabilities $ 232.4 $ 163.1 Other Current Assets
161.5 175.9 Long-Term Debt 808.4 857.9 Property, Plant and
Equipment 2,177.5 1,982.7 Deferred Income Taxes 388.0 373.6
Regulatory Assets 336.9 345.9 Regulatory Liabilities 49.3 43.5
Defined Benefit Pension & Other Investment in ATC 102.6 98.9
Postretirement Benefit Plans 253.8 253.5 Investments 136.0 132.3
Other Liabilities 110.6 105.1 Other 39.1
39.2 Shareholders’ Equity
1,119.7 1,079.3
Total
Assets $ 2,962.2 $ 2,876.0
Total Liabilities and Shareholders’ Equity
$ 2,962.2 $ 2,876.0
Quarter Ended Six Months
Ended ALLETE, Inc. June 30, June 30,
Income (Loss) 2012
2011 2012 2011
Millions Regulated Operations $ 14.4 $
18.3 $ 38.8 $ 56.7 Investments and Other
— (1.3 ) —
(2.5 ) Net Income Attributable to ALLETE
$ 14.4 $ 17.0 $
38.8 $ 54.2
Diluted Earnings Per Share
$ 0.39 $ 0.48
$ 1.05 $ 1.55
Statistical
Data
Corporate Common Stock High $
41.99 $ 41.43 $ 42.49 $ 41.43 Low $ 38.03 $ 37.87 $ 38.03 $ 36.33
Close $ 41.80 $ 41.04 $ 41.80 $ 41.04 Book Value $ 29.24 $ 28.23 $
29.24 $ 28.23
Kilowatt-hours Sold
Millions Regulated Utility Retail and Municipals
Residential 226 238 552 600 Commercial 326 328 690 704 Municipals
234 230 498 499 Industrial 1,842
1,782 3,710
3,620 Total Retail and Municipal 2,628 2,578 5,450
5,423 Other Power Suppliers 492
614 1,009
1,154 Total Regulated Utility 3,120 3,192 6,459 6,577
Non-regulated Energy Operations 25
25 55
51 Total Kilowatt-hours Sold
3,145 3,217
6,514 6,628
Regulated
Utility Revenue
Millions Regulated
Utility Revenue Retail and Municipals Residential $ 20.5 $ 23.6 $
49.9 $ 58.0 Commercial 24.7 26.2 51.9 55.5 Municipals 13.9 15.4
31.3 32.6 Industrial 93.5
96.3 191.3
194.1 Total Retail and Municipals 152.6 161.5 324.4 340.2
Other Power Suppliers 17.7 20.7 36.4 40.3 Other
26.7 19.6
54.8 44.3 Total Regulated
Utility Revenue $ 197.0 $ 201.8
$ 415.6 $ 424.8
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