ALLETE Reports Second-Quarter Net Income Growth Of 14 Percent
DULUTH, Minn.--ALLETE, Inc. (NYSE: ALE) today reported second quarter 2003 earnings of 53 cents per share, compared with 47 cents per share in the second quarter of 2002. Net income rose 14 percent to $44.4 million on revenue of $409.9 million compared with $38.8 million of net income on $375.9 million of revenue in the second quarter of 2002.
"We are pleased with the overall financial results for the quarter," said Dave Gartzke, ALLETE Chairman, President and CEO. "We remain confident that our total year performance expectations will be achieved."
Net income at Automotive Services was $34.1 million in the second quarter of 2003, an increase of 14 percent over the same time period last year. This was due to increased vehicle sales and improved conversion rates at ADESA's U.S. auctions, and lower interest expense. Conversion rates are the percentage of vehicles sold from those that were run through the auction lanes. Year-to-date earnings at Automotive Services were up 11 percent over the same period last year.
Energy Services net income was $6.8 million in the quarter compared with $9.7 million for the second quarter of 2002. The decrease was mainly due to the required recognition in 2002 of a $2.8 million mark-to-market accounting gain on the Kendall County power purchase agreement. Certain mark-to-market accounting rules were rescinded late in 2002, and this $2.8 million gain was reversed in the fourth quarter. Excluding this accounting entry, results in the second quarter of 2003 were similar to the same time period of 2002.
Strong real estate sales at ALLETE Properties contributed to the $2.2 million increase in net income from Investments and Corporate Charges. Results from Discontinued Operations were higher than in 2002 when ALLETE recorded exit charges relating to its vehicle transport businesses.
ALLETE's corporate headquarters are located in Duluth, Minnesota. ALLETE's holdings include ADESA, the second largest wholesale vehicle auction network in North America; AFC, the leading provider of independent auto dealer financing; Minnesota Power, a low-cost electric utility that serves some of the largest industrial customers in the United States; and significant real estate holdings in Florida. For more information about ALLETE, visit the company's Web site 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.
