ALLETE Reports Solid First Quarter Earnings

Apr 18, 2001, 01:00 ET from ALLETE

    DULUTH, Minn., April 18 /PRNewswire/ -- ALLETE (NYSE:   ALE) today announced
 earnings of 46 cents per share for the first quarter of 2001, compared to
 43 cents for the first quarter of 2000.  Net income was up 8 percent to
 $32.9 million on quarterly revenue of $413.0 million, compared to
 $30.4 million of net income and $322.6 million in revenue a year ago.
     /Photo:  http://www.newscom.com/cgi-bin/prnh/20010308/ALLETELOGO /
     "Each of our four businesses performed well this quarter," said Ed
 Russell, ALLETE President and CEO.  "Our diverse strengths in basic
 necessities -- cars, electricity, water and real estate -- continue to help us
 prosper during times of economic challenge."
     Automotive services showed continued growth with net income for the
 quarter rising by $5.8 million.  The 49 percent increase over the same period
 last year was due in large part to acquisitions made in 2000 and increased
 financing activity at Automotive Finance Corporation.
     Energy services posted an 11 percent increase in net income due to a
 combination of factors.  Property taxes and O&M expenses were down compared to
 a year ago.  Wholesale, residential and commercial margins were higher than
 last year and helped offset a decrease in industrial margins.
     Water services experienced continued strong customer growth of 6 percent
 over the period.  In addition, higher rates in North Carolina, productivity
 enhancements and an escrow fund adjustment in Florida helped this business
 segment achieve a 29 percent increase in net income for the quarter over last
 year.
     Investments reported a $6.0 million decrease in net income for the
 quarter, primarily due to three large real estate transactions that occurred
 in the first quarter of 2000.  ALLETE Properties recently announced that its
 largest sale ever is expected to close in June 2001.  The company's securities
 portfolio saw strong returns in 2001 compared to 2000, but had less cash to
 invest due to ALLETE's significant acquisition activity during the past year.
     ALLETE is a multi-services company with corporate headquarters in Duluth,
 Minn.  ALLETE's holdings include the second largest wholesale automobile
 auction network in North America; the leading provider of independent auto
 dealer inventory financing; the largest private 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 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
                        Consolidated Statement of Income
                 For the Periods Ended March 31, 2001 and 2000
                       Millions Except Per Share Amounts
 
                                                                Year to Date
                                                               2001      2000
 
     Operating Revenue
       Energy Services                                        $159.4    $141.6
       Automotive Services                                     211.1     119.5
       Water Services                                           29.5      28.0
       Investments                                              13.0      33.5
 
         Total Operating Revenue                               413.0     322.6
 
     Operating Expenses
       Fuel and Purchased Power                                 62.4      53.1
       Operations                                              272.6     201.2
       Interest Expense                                         22.0      16.3
 
         Total Operating Expenses                              357.0     270.6
 
     Operating Income                                           56.0      52.0
 
     Distributions on Redeemable
      Preferred Securities of Subsidiary                         1.5       1.5
     Income Tax Expense                                         21.6      20.1
 
     Net Income                                                $32.9     $30.4
 
     Average Shares of Common Stock
       Basic                                                    71.2      69.1
       Diluted                                                  71.8      69.2
 
     Earnings Per Share of Common Stock
       Basic                                                   $0.46     $0.43
       Diluted                                                 $0.46     $0.43
 
     Dividends Per Share of Common Stock                     $0.2675   $0.2675
 
 
                                     ALLETE
                           Consolidated Balance Sheet
                                    Millions
 
                                                            Mar. 31,   Dec. 31,
                                                               2001      2000
     Assets
     Current Assets                                           $871.0    $731.0
     Property, Plant and Equipment                           1,493.5   1,479.7
     Investments                                               118.0     116.4
     Goodwill                                                  499.5     472.8
     Other                                                     115.5     114.1
     Total Assets                                           $3,097.5  $2,914.0
 
 
                                                            Mar. 31,   Dec. 31,
                                                               2001      2000
 
     Liabilities and Stockholders' Equity
     Current Liabilities                                      $755.4    $707.0
     Long-Term Debt                                          1,069.5     952.3
     Other Liabilities                                         280.1     278.9
     Mandatorily Redeemable Preferred
      Securities of ALLETE Capital I                            75.0      75.0
     Stockholders' Equity                                      917.5     900.8
     Total Liabilities and Stockholders' Equity             $3,097.5  $2,914.0
 
 
                                                                 Year to Date
                                                                   March 31,
     ALLETE                                                     2001      2000
     Net Income
     Millions
       Energy Services                                         $11.9     $10.7
       Automotive Services                                      17.7      11.9
       Water Services                                            3.1       2.4
       Investments                                               5.5      11.5
       Corporate Charges                                        (5.3)     (6.1)
 
         Net Income                                            $32.9     $30.4
 
     Diluted Earnings Per Share                                $0.46     $0.43
 
 
     Statistical Data
 
     Corporate
       Common Stock
         High                                                 $26.00    $18.06
         Low                                                  $20.19    $14.75
         Close                                                $25.82    $16.63
 
       Book Value                                             $12.13    $11.45
 
     Energy Services
       Millions of Kilowatthours Sold
         Retail
           Residential                                         270.4     257.8
           Commercial                                          285.4     276.8
           Industrial                                        1,524.3   1,719.0
           Other                                                18.8      18.3
         Resale                                                814.1     847.8
                                                             2,913.0   3,119.7
 
     Automotive Services
       Vehicles Sold                                         500,000   295,000
       Vehicles Financed                                     221,000   195,000
       EBITDAL (Millions) **                                   $57.8     $34.4
 
     Water Services
       Millions of Gallons Billed
 
       Florida Water Services
         Water                                               4,344.3   4,238.2
         Wastewater                                          1,297.0   1,289.4
 
       Heater Utilities
         Water                                                 672.1     683.5
 
 
     ** Earnings Before Interest, Taxes, Depreciation, Amortization and Lease
        Expense
 
 

SOURCE ALLETE
    DULUTH, Minn., April 18 /PRNewswire/ -- ALLETE (NYSE:   ALE) today announced
 earnings of 46 cents per share for the first quarter of 2001, compared to
 43 cents for the first quarter of 2000.  Net income was up 8 percent to
 $32.9 million on quarterly revenue of $413.0 million, compared to
 $30.4 million of net income and $322.6 million in revenue a year ago.
     /Photo:  http://www.newscom.com/cgi-bin/prnh/20010308/ALLETELOGO /
     "Each of our four businesses performed well this quarter," said Ed
 Russell, ALLETE President and CEO.  "Our diverse strengths in basic
 necessities -- cars, electricity, water and real estate -- continue to help us
 prosper during times of economic challenge."
     Automotive services showed continued growth with net income for the
 quarter rising by $5.8 million.  The 49 percent increase over the same period
 last year was due in large part to acquisitions made in 2000 and increased
 financing activity at Automotive Finance Corporation.
     Energy services posted an 11 percent increase in net income due to a
 combination of factors.  Property taxes and O&M expenses were down compared to
 a year ago.  Wholesale, residential and commercial margins were higher than
 last year and helped offset a decrease in industrial margins.
     Water services experienced continued strong customer growth of 6 percent
 over the period.  In addition, higher rates in North Carolina, productivity
 enhancements and an escrow fund adjustment in Florida helped this business
 segment achieve a 29 percent increase in net income for the quarter over last
 year.
     Investments reported a $6.0 million decrease in net income for the
 quarter, primarily due to three large real estate transactions that occurred
 in the first quarter of 2000.  ALLETE Properties recently announced that its
 largest sale ever is expected to close in June 2001.  The company's securities
 portfolio saw strong returns in 2001 compared to 2000, but had less cash to
 invest due to ALLETE's significant acquisition activity during the past year.
     ALLETE is a multi-services company with corporate headquarters in Duluth,
 Minn.  ALLETE's holdings include the second largest wholesale automobile
 auction network in North America; the leading provider of independent auto
 dealer inventory financing; the largest private 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 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
                        Consolidated Statement of Income
                 For the Periods Ended March 31, 2001 and 2000
                       Millions Except Per Share Amounts
 
                                                                Year to Date
                                                               2001      2000
 
     Operating Revenue
       Energy Services                                        $159.4    $141.6
       Automotive Services                                     211.1     119.5
       Water Services                                           29.5      28.0
       Investments                                              13.0      33.5
 
         Total Operating Revenue                               413.0     322.6
 
     Operating Expenses
       Fuel and Purchased Power                                 62.4      53.1
       Operations                                              272.6     201.2
       Interest Expense                                         22.0      16.3
 
         Total Operating Expenses                              357.0     270.6
 
     Operating Income                                           56.0      52.0
 
     Distributions on Redeemable
      Preferred Securities of Subsidiary                         1.5       1.5
     Income Tax Expense                                         21.6      20.1
 
     Net Income                                                $32.9     $30.4
 
     Average Shares of Common Stock
       Basic                                                    71.2      69.1
       Diluted                                                  71.8      69.2
 
     Earnings Per Share of Common Stock
       Basic                                                   $0.46     $0.43
       Diluted                                                 $0.46     $0.43
 
     Dividends Per Share of Common Stock                     $0.2675   $0.2675
 
 
                                     ALLETE
                           Consolidated Balance Sheet
                                    Millions
 
                                                            Mar. 31,   Dec. 31,
                                                               2001      2000
     Assets
     Current Assets                                           $871.0    $731.0
     Property, Plant and Equipment                           1,493.5   1,479.7
     Investments                                               118.0     116.4
     Goodwill                                                  499.5     472.8
     Other                                                     115.5     114.1
     Total Assets                                           $3,097.5  $2,914.0
 
 
                                                            Mar. 31,   Dec. 31,
                                                               2001      2000
 
     Liabilities and Stockholders' Equity
     Current Liabilities                                      $755.4    $707.0
     Long-Term Debt                                          1,069.5     952.3
     Other Liabilities                                         280.1     278.9
     Mandatorily Redeemable Preferred
      Securities of ALLETE Capital I                            75.0      75.0
     Stockholders' Equity                                      917.5     900.8
     Total Liabilities and Stockholders' Equity             $3,097.5  $2,914.0
 
 
                                                                 Year to Date
                                                                   March 31,
     ALLETE                                                     2001      2000
     Net Income
     Millions
       Energy Services                                         $11.9     $10.7
       Automotive Services                                      17.7      11.9
       Water Services                                            3.1       2.4
       Investments                                               5.5      11.5
       Corporate Charges                                        (5.3)     (6.1)
 
         Net Income                                            $32.9     $30.4
 
     Diluted Earnings Per Share                                $0.46     $0.43
 
 
     Statistical Data
 
     Corporate
       Common Stock
         High                                                 $26.00    $18.06
         Low                                                  $20.19    $14.75
         Close                                                $25.82    $16.63
 
       Book Value                                             $12.13    $11.45
 
     Energy Services
       Millions of Kilowatthours Sold
         Retail
           Residential                                         270.4     257.8
           Commercial                                          285.4     276.8
           Industrial                                        1,524.3   1,719.0
           Other                                                18.8      18.3
         Resale                                                814.1     847.8
                                                             2,913.0   3,119.7
 
     Automotive Services
       Vehicles Sold                                         500,000   295,000
       Vehicles Financed                                     221,000   195,000
       EBITDAL (Millions) **                                   $57.8     $34.4
 
     Water Services
       Millions of Gallons Billed
 
       Florida Water Services
         Water                                               4,344.3   4,238.2
         Wastewater                                          1,297.0   1,289.4
 
       Heater Utilities
         Water                                                 672.1     683.5
 
 
     ** Earnings Before Interest, Taxes, Depreciation, Amortization and Lease
        Expense
 
 SOURCE  ALLETE