ALLETE Third Quarter Earnings on Target; Annual Earnings Growth Target Hiked to 12 Percent for 2001
Third quarter net income was $35 million on quarterly revenue of $323.5 million compared to net income of $34.5 million on revenue of $308 million a year ago.
"We are on track to achieve our target of 10 percent annual earnings growth for 2000," said Edwin L. Russell, chief executive officer of ALLETE. "Equally important, our automotive acquisitions have positioned us to grow earnings by 12 percent in 2001." Russell noted that ADESA recently acquired 24 auto auctions in three different transactions. Based on twelve-month-ended historical data, the newly acquired auctions sold about 600,000 vehicles, generating revenue of approximately $200 million.
Automotive Services continued its double-digit growth in net income. The number of vehicles sold at ADESA auctions increased 23 percent. Same store growth increased 13 percent as measured by earnings before interest, taxes, depreciation, amortization and lease expense. Vehicles financed by Automotive Finance Corporation were up 6.5 percent over the same period last year. In addition, AFC's loan portfolio is up 15 percent over 1999 to $395 million.
Third quarter net income from Investments was lower than 1999 because of two large real estate transactions that occurred last year. Overall, year-to-date results for real estate are ahead of last year, although they typically vary from quarter to quarter, depending on the timing of major transactions. Net income from the company's securities portfolio and emerging technology investments posted strong increases over last year.
In Energy Services, sales to industrial, commercial and residential customers were up 13 percent and exceeded record levels that were achieved in 1999. Net income, however, declined by $7.2 million due in large part to a lack of demand in the region's power market as a result of more moderate summer weather. Transmission constraints were also a factor.
Net income from Water Services was steady.
ALLETE is a multi-services company with corporate headquarters in Duluth, Minnesota. Holdings include the second largest wholesale automobile auction network in North America; the leading provider of independent auto dealer inventory financing; the largest investor-owned water utilities in Florida and North Carolina; significant real estate holdings in Florida and a low-cost electric utility that serves some of the largest industrial customers in the United States.
The statements contained in this release and statements that the company 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 the company with the Securities and Exchange Commission.
