ALLETE, Inc. (NYSE: ALE) today reported second quarter 2018
earnings of 61 cents per share on net income of $31.3 million
and operating revenue of $344.1 million. Last year’s results were
72 cents per share on net income of $36.9 million and
operating revenue of $353.3 million.
“Financial results from ALLETE’s businesses reflect strong power
demand from taconite customers, impacts from Minnesota Power's
recent rate case and notable progress from ALLETE Clean Energy on
its wind turbine refurbishment strategy," said ALLETE Chairman,
President and CEO Al Hodnik. "Setting aside year over year timing
differentials, ALLETE posted a solid quarter and we remain
confident in our full year 2018 earnings guidance range of $3.20 to
$3.50 per share. We are well positioned for growth as our diverse
family of businesses captures value in a growing domestic economy,
and our nation focuses on sustainable energy and water
solutions.”
ALLETE’s Regulated Operations segment, which includes Minnesota
Power, Superior Water, Light and Power, and the Company’s
investment in the American Transmission Co. (ATC), recorded net
income of $26.0 million for the second quarter of 2018, a decrease
of $6.4 million from 2017. Earnings decreased primarily due to
lower net income at Minnesota Power resulting from the timing of
reserves for an interim rate refund of $5.6 million after-tax, the
timing of approval for financial incentives under the Minnesota
conservation improvement program of $3.9 million after-tax, and
lower transmission revenue. These decreases were partially offset
by higher sales to residential, commercial and municipal customers
due to more favorable weather conditions, and lower operating and
maintenance expense.
ALLETE’s Energy Infrastructure and Related Services businesses,
which include ALLETE Clean Energy and U.S. Water Services, recorded
net income of $6.8 million and $0.2 million for the second quarter
of 2018, respectively. Earnings at ALLETE Clean Energy increased
$3.0 million from 2017. Net income in 2018 included $3.9
million after-tax of additional production tax credits generated as
ALLETE Clean Energy executes on its refurbishment strategy and a
lower federal income tax rate, partially offset by higher operating
and maintenance expenses and lower revenue resulting from lower
wind resources compared to the same period in 2017. Earnings from
U.S. Water Services reflect higher operating expenses, partially
offset by higher revenue primarily from the September 2017
acquisition of Tonka Water. Results this period were also
negatively impacted by the timing of capital project sales.
ALLETE will host a conference call and webcast at 10 a.m.
Eastern Time this morning to discuss details of its 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 August 6, 2018 by calling
(855) 859-2056, pass code 9699879. The webcast will be accessible
for one year at www.allete.com.
ALLETE is an energy company headquartered in Duluth,
Minn. In addition to its electric utilities, Minnesota
Power and Superior Water, Light and
Power of Wisconsin, ALLETE owns ALLETE Clean
Energy, based in Duluth, BNI Energy in Bismarck,
N.D., U.S. Water Services headquartered in St. Michael, Minn.,
and has an eight percent equity interest in the American
Transmission Co. More information about ALLETE is
available at www.allete.com.
ALE-CORP
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,
2018 2017 2018
2017 Operating Revenue
Contracts with Customers – Utility $257.8 $264.9
$528.0 $546.5 Contracts with Customers – Non-utility 80.4 82.5
162.4 160.6 Other – Non-utility 5.9
5.9 11.9 11.8
Total Operating Revenue 344.1
353.3 702.3 718.9
Operating Expenses Fuel, Purchased Power and Gas –
Utility 96.5 93.1 197.4 189.7 Transmission Services – Utility 16.8
17.6 35.2 34.2 Cost of Sales – Non-utility 37.0 38.4 69.9 69.9
Operating and Maintenance 86.8 85.9 173.3 170.3 Depreciation and
Amortization 56.1 50.1 101.9 100.6 Taxes Other than Income Taxes
14.4 14.2
30.7 28.6 Total Operating Expenses
307.6 299.3
608.4 593.3
Operating Income
36.5 54.0
93.9 125.6
Other Income
(Expense) Interest Expense (17.1 ) (16.7 ) (34.0 ) (33.9 )
Equity Earnings in ATC 4.3 5.3 9.0 11.4 Other 2.2
1.6 4.3
3.2 Total Other Expense (10.6 )
(9.8 ) (20.7 ) (19.3 )
Income
Before Income Taxes 25.9 44.2 73.2 106.3
Income Tax Expense
(Benefit) (5.4 ) 7.3
(9.1 ) 20.4
Net Income
$31.3 $36.9 $82.3
$85.9
Average Shares of Common
Stock Basic 51.3 50.9 51.2 50.5 Diluted 51.5
51.1 51.4
50.7
Basic Earnings Per Share of Common Stock
$0.61 $0.73 $1.61 $1.70
Diluted Earnings Per Share of Common
Stock $0.61 $0.72 $1.60 $1.69
Dividends Per Share of Common
Stock $0.56 $0.535
$1.12 $1.07
Consolidated Balance Sheet
Millions - Unaudited
Jun. 30, Dec. 31, Jun. 30, Dec.
31, 2018 2017
2018
2017 Assets Liabilities and Shareholders’
Equity Cash and Cash Equivalents $121.9 $98.9 Current
Liabilities $350.2 $351.2 Other Current Assets 302.1 268.6
Long-Term Debt 1,462.2 1,439.2 Property, Plant and Equipment – Net
3,809.3 3,822.4 Deferred Income Taxes 228.5 230.5 Regulatory Assets
374.5 384.7 Regulatory Liabilities 516.0 532.0 Investment in ATC
123.6 118.7 Defined Benefit Pension and Other Postretirement
Benefit Plans 175.2 191.8 Other Investments 52.5 53.1 Other
Non-Current Liabilities 274.4 267.1 Goodwill and Intangibles – Net
225.8 225.9 Shareholders’ Equity 2,108.2 2,068.2 Other Non-Current
Assets 105.0 107.7
Total Assets
$5,114.7 $5,080.0
Total Liabilities and Shareholders’ Equity
$5,114.7 $5,080.0
Quarter Ended Six Months Ended ALLETE, Inc.
June 30, June 30, Income (Loss)
2018 2017 2018
2017 Millions
Regulated Operations $26.0 $32.4 $69.9 $75.9 Energy
Infrastructure and Related Services ALLETE Clean Energy 6.8 3.8
14.9 10.5 U.S. Water Services 0.2 0.6 (1.2 ) 0.3 Corporate
and Other (1.7 ) 0.1 (1.3
) (0.8 ) Net Income Attributable to ALLETE
$31.3 $36.9 $82.3
$85.9
Diluted Earnings Per Share
$0.61 $0.72 $1.60
$1.69
Statistical Data
Corporate Common Stock High $79.86 $74.59 $79.86
$74.59 Low $70.40 $66.81 $66.64 $61.64 Close $77.41 $71.68 $77.41
$71.68 Book Value $41.05 $39.58
$41.05 $39.58
Kilowatt-hours Sold
Millions Regulated
Utility Retail and Municipal Residential 243 229 585 552 Commercial
339 328 706 697 Industrial 1,781 1,816 3,624 3,578 Municipal
188 181 407
396 Total Retail and Municipal 2,551 2,554 5,322
5,223 Other Power Suppliers 1,005
1,004 2,008 2,045
Total Regulated Utility Kilowatt-hours Sold 3,556
3,558 7,330
7,268
Regulated Utility Revenue
Millions Regulated Utility Revenue Retail and Municipal
Electric Revenue Residential $28.0 $25.1 $63.5 $59.8 Commercial
35.2 32.4 69.2 68.4 Industrial 114.7 121.0 228.0 241.5 Municipal
13.7 12.3 27.7
30.5 Total Retail and Municipal
Electric Revenue 191.6 190.8 388.4 400.2 Other Power Suppliers 42.7
41.7 86.4 82.9 Other (Includes Water and Gas Revenue)
23.5 32.4 53.2
63.4 Total Regulated Utility Revenue
$257.8 $264.9 $528.0
$546.5
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version on businesswire.com: https://www.businesswire.com/news/home/20180802005106/en/
ALLETE, Inc.Investor Contact:Vince Meyer,
218-723-3952vmeyer@allete.com
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