Alliant Energy Announces Second Quarter 2010 Results

MADISON, Wis., Aug. 5 /PRNewswire-FirstCall/ -- Alliant Energy Corporation (NYSE: LNT) today announced second quarter generally accepted accounting principles (GAAP) and non-GAAP consolidated earnings from continuing operations as follows:

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Alliant Energy's 2010 second quarter non-GAAP EPS were $0.44 per share, which was $0.10 per share higher than the second quarter of 2009.  Earnings for Alliant Energy's utility business were positively impacted by retail rate increases. The positive EPS driver was partially offset by higher transmission service expense, higher depreciation and operating expenses due to placing the Whispering Willow - East wind project in-service in late 2009, lower allowance for funds used during construction (AFUDC) due to lower wind construction work in progress balances, and the results of the annual electric unbilled adjustment.

"I am pleased with the solid financial results produced in the second quarter," said Bill Harvey, Alliant Energy Chairman, President, and CEO.  "Based on our year-to-date results we are narrowing our earnings guidance range for 2010."

Utility GAAP EPS were impacted by a total of ($0.01) per share of net charges in the second quarter of 2010 and ($0.08) per share of charges in the second quarter of 2009 for various non-GAAP adjustments.  Non-GAAP adjustments, which generally relate to significant charges or credits that are not normally associated with ongoing operations, are provided as a supplement to results reported in accordance with GAAP.  Adjusted, or non-GAAP, operating earnings for the second quarter of 2010 and 2009 do not include the following items (after tax) that were included in reported GAAP earnings:

EPS and income in the second quarter of 2010 and 2009 are as follows:

Additional details regarding second quarter GAAP EPS from Alliant Energy's Utility operations are as follows:

The following comments further explain selected drivers of earnings performance during the second quarter of 2010 versus 2009:

Electric and gas retail rate increases:  On March 20, 2010, IPL implemented annualized interim rates of $119 million as part of its retail electric rate case in Iowa filed on March 10, 2010.  The interim rate increase is expected to recover higher electric transmission service expenses and a return on the investment in and recovery of expenses for, the Whispering Willow - East wind project, which was placed in service at the end of 2009, as well as other infrastructure investments.

On January 1, 2010, WPL implemented new retail electric and gas rates as a result of its rate case filed in May 2009.  The $65 million annualized rate increase includes an adjustment for lower sales net of variable fuel expenses, return on one-half of the average 2010 Bent Tree – Phase I wind project construction costs, and higher pension costs incurred in 2009.

Restructuring and impairment charges:  During the second quarter of 2010, Alliant Energy completed its evaluation of IPL's Sixth Street Generating Station and decided not to rebuild electric operations at the facility, which was significantly damaged by the severe flooding in downtown Cedar Rapids, Iowa in 2008. As a result of this decision, IPL recognized a $0.02 per share impairment associated with the Sixth Street assets that were previously recorded in construction work in progress.  Alliant Energy also incurred $0.02 per share of restructuring charges in the second quarter of 2010 resulting from management and staff position reductions.

During the second quarter of 2009, Alliant Energy announced reductions in executive, management and staff positions and the ceasing of operations of 4 units in WPL's generating fleet.  Restructuring charges associated with these actions reduced earnings by $0.06 per share.  Also during the second quarter of 2009, IPL announced that it would stop providing steam service in downtown Cedar Rapids, Iowa.  This decision resulted in an impairment charge that reduced earnings $0.02 per share in the second quarter of 2009.

Electric transmission service expenses:  Higher electric transmission expenses reduced EPS $0.07 per share in the second quarter of 2009.  The IPL interim rate increase implemented on March 20, 2010, mentioned above, recovered the higher transmission expenses in the second quarter of 2010 and is expected to recover the higher electric transmission expense for the remainder of 2010.

Depreciation adjustment:  WPL recorded a depreciation adjustment, which impacted the second quarter of 2010 by $0.05 per share.  The adjustment is not expected to materially impact future earnings.

2010 Earnings Guidance

Alliant Energy is narrowing its 2010 earnings guidance, which excludes net charges associated with non-GAAP adjustments discussed in this release.

The guidance does not include the impacts of any non-cash valuation adjustments, charges resulting from federal health care legislation, future regulatory-related charges or credits resulting from decisions by regulators, reorganization or restructuring charges, future changes in laws or regulations, future adjustments made to deferred tax asset valuation allowances, adverse impacts of pending lawsuits and disputes, depreciation adjustments or changes in accounting principles that may impact the reported results of Alliant Energy.

Drivers for Alliant Energy's 2010 earnings guidance include, but are not limited to:

• No refund reserves related to IPL's interim rates in Iowa and Minnesota
• Stable economy and resulting implications on utility sales
• Normal weather and operating conditions in its utility service territories
• Ability of IPL and WPL to recover future purchased power, fuel and fuel-related costs through rates in a timely manner
• Ability of IPL and WPL to recover their operating costs, deferred expenditures and capital expenditures, and to earn a reasonable rate of return
• Continuing cost controls and operational efficiencies
• Execution of IPL's and WPL's wind projects and environmental expenditure plans
• Ability to utilize federal net operating losses and federal credit carry forwards
• RMT, Inc.'s (RMT's) estimated market share and project execution

Earnings Conference Call

A conference call to review the second quarter of 2010 results is scheduled for Thursday, August 5th at 9:00 a.m. central daylight time.  Alliant Energy Chairman, President and Chief Executive Officer Bill Harvey and Executive Vice President - Chief Financial Officer and Treasurer Patricia Kampling will host the call.  The conference call is open to the public and can be accessed in two ways.  Interested parties may listen to the call by dialing 888-221-9591 (United States or Canada) or 913-312-1434 (International), passcode 8244179.  Interested parties may also listen to a webcast at www.alliantenergy.com/investors.  In conjunction with the information in this earnings announcement and the conference call, Alliant Energy posted supplemental materials on its website.  A replay of the call will be available through August 12, 2010, at 888-203-1112 (United States or Canada) or 719-457-0820 (International), passcode 8244179.  An archive of the webcast will be available on the Company's Web site at www.alliantenergy.com/investors for 12 months.

Alliant Energy is the parent company of two public utility companies – Interstate Power and Light Company and Wisconsin Power and Light Company – and of Alliant Energy Resources, LLC, the parent company of Alliant Energy's non-regulated operations.  Alliant Energy is an energy-services provider with subsidiaries serving approximately 1 million electric and 412,000 natural gas customers.  Providing its customers in the Midwest with regulated electricity and natural gas service is the Company's primary focus.  Alliant Energy, headquartered in Madison, Wis., is a Fortune 1000 company traded on the New York Stock Exchange under the symbol LNT.  For more information, visit the Company's Web site at www.alliantenergy.com.

This press release includes forward-looking statements.  These forward-looking statements can be identified as such because the statements include words such as "expect" or other words of similar import.  Similarly, statements that describe future financial performance or plans or strategies are forward-looking statements.  Such statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those currently anticipated.  Actual results could be affected by the following factors, among others:

• federal and state regulatory or governmental actions, including the impact of energy, tax and health care legislation, and of regulatory agency orders;
• IPL's and WPL's ability to obtain adequate and timely rate relief to allow for, among other things, the recovery of operating costs, fuel costs, deferred expenditures, capital expenditures, including any construction costs incurred over the predetermined level included in the advanced rate making principles for IPL's Whispering Willow - East wind project, and costs related to generating units that may be permanently closed, the earning of reasonable rates of return, and the payments to their parent of expected levels of dividends;
• the state of the economy in IPL's and WPL's service territories and resulting implications on sales, margins and ability to collect unpaid bills;
• weather effects on results of operations;
• developments that adversely impact the ability to implement strategic plans including unanticipated issues in connection with construction and operation of IPL's and WPL's new wind generating facilities, WPL's potential purchases of the Riverside Energy Center and Wisconsin Electric Power Company's 25% interest in the Edgewater Generating Station Unit 5, Alliant Energy's ability to complete the proposed divestiture of its Industrial Energy Applications, Inc. business, and unfavorable regulatory outcomes;
• successful resolution of the pending challenge to the approval by the Public Service Commission of Wisconsin (PSCW) of WPL's Bent Tree - Phase I wind project;
• issues related to the availability of generating facilities and the supply and delivery of fuel and purchased electricity and price thereof, including the ability to recover and to retain the recovery of purchased power, fuel and fuel-related costs through rates in a timely manner;
• the impact that fuel and fuel-related prices and other economic conditions may have on IPL's and WPL's customers' demand for utility services;
• impacts that storms or natural disasters in IPL's and WPL's service territories may have on their operations and recovery of and rate relief for costs associated with restoration activities;
• issues associated with environmental remediation efforts and with environmental compliance generally, including changing environmental laws and regulations, the ability to defend against environmental claims brought by state and federal agencies, such as the U.S. Environmental Protection Agency, or third parties, such as the Sierra Club, and the ability to recover through rates all environmental compliance costs, including costs for projects put on hold due to uncertainty of future environmental laws and regulations;
• potential impacts of changing regulations on the ability to utilize already-purchased emission allowances and forward contracts to purchase additional emission allowances;
• the ability to continue cost controls and operational efficiencies;
• potential impacts of any future laws or regulations regarding global climate change or carbon emissions reductions, including those that contain a proposed greenhouse gas cap-and-trade program;
• continued access to the capital markets on competitive terms and rates;
• inflation and interest rates;
• financial impacts of risk hedging strategies, including the impact of weather hedges or the absence of weather hedges on earnings;
• sales and project execution for RMT, the level of growth in the wind and solar development market and the impact of the American Recovery and Reinvestment Act of 2009, and pending legislation;
• issues related to electric transmission, including operating in Regional Transmission Organization (RTO) energy and ancillary services markets, the impacts of potential future billing adjustments and cost allocation changes from RTOs and recovery of costs incurred;
• unplanned outages, transmission constraints or operational issues impacting fossil or renewable generating facilities and risks related to recovery of resulting incremental costs through rates;
• Alliant Energy's ability to successfully defend against, and any liabilities arising out of, the purported shareowner derivative complaint stemming from the Exchangeable Senior Notes due 2030;
• Alliant Energy's ability to successfully pursue appropriate appeals with respect to any liabilities arising out of, the alleged violation of the Employee Retirement Income Security Act of 1974 by Alliant Energy's Cash Balance Pension Plan;
• current or future litigation, regulatory investigations, proceedings or inquiries;
• Alliant Energy's ability to sustain its dividend payout ratio goal;
• employee workforce factors, including changes in key executives, collective bargaining agreements and negotiations, work stoppages or additional restructurings;
• access to technological developments;
• any material post-closing adjustments related to any past asset divestitures;
• increased retirement and benefit plan costs;
• the impact of necessary accruals for the terms of incentive compensation plans;
• the effect of accounting pronouncements issued periodically by standard-setting bodies;
• the ability to utilize tax capital losses, tax credits and net operating losses generated to date, and those that may be generated in the future, before they expire;
• the ability to successfully complete ongoing tax audits and appeals with no material impact on earnings and cash flows;
• the direct or indirect effects resulting from terrorist incidents or responses to such incidents; and
• factors listed in the "2010 Earnings Guidance" section of this press release.

Without limitation, the expectations with respect to 2010 Earnings Guidance in this press release are forward-looking statements and are based in part on certain assumptions made by Alliant Energy, some of which are referred to in the forward-looking statements.  Alliant Energy cannot provide any assurance that the assumptions referred to in the forward-looking statements or otherwise are accurate or will prove to be correct.  Any assumptions that are inaccurate or do not prove to be correct could have a material adverse effect on Alliant Energy's ability to achieve the estimates or other targets included in the forward-looking statements.  The forward-looking statements included herein are made as of the date hereof and Alliant Energy undertakes no obligation to update publicly such statements to reflect subsequent events or circumstances.

Note: Unless otherwise noted, all "per share" references in this release refer to earnings per diluted share.

SOURCE Alliant Energy Corporation