ATCO Reports Third Quarter Earnings of $61.0 Million
31 Ottobre 2009 - 12:28AM
Marketwired Canada
ATCO Ltd. (TSX:ACO.X) (TSX:ACO.Y)
ATCO Ltd. today reported increased earnings of $61.0 million ($1.05 per share)
for the three months ended September 30, 2009, compared to earnings of $52.5
million ($0.91 per share) for the same three months in 2008. ATCO reported a
decrease in "adjusted earnings" (1) for the third quarter, which excludes
certain items not in the normal course of business or day to day operations.
Adjusted earnings for the three months ended September 30, 2009 were $53.3
million ($0.92 per share) compared to adjusted earnings of $54.9 million ($0.95
per share) for the same three months in 2008.
Earnings for the nine months ended September 30, 2009 were $205.1 million ($3.54
per share) compared to earnings of $197.4 million ($3.42 per share) for the same
nine months in 2008. Adjusted earnings for the nine months ended September 30,
2009 were $199.1 million ($3.44 per share) compared to adjusted earnings of
$193.5 million ($3.35 per share) for the same nine months in 2008.
RECENT DEVELOPMENTS DURING THE THIRD QUARTER
- In the third quarter of 2009, as a result of regulatory and legal proceedings,
ATCO Gas has removed the Carbon natural gas storage facility (Carbon Facility)
from regulation for accounting purposes. As a result, ATCO Gas has derecognized
all previously recorded regulatory assets and liabilities relating to the Carbon
Facility as these amounts are no longer recoverable from or payable to ATCO Gas'
customers. Furthermore, ATCO Gas has received approval from the Alberta
Utilities Commission (AUC) to suspend customer rate riders that were approved in
the past to distribute net revenues related to the Carbon Facility to customers
(Removal of the Carbon Facility from Regulation and Suspension of the Carbon
Rate Riders).
- In July 2009, ATCO Ltd. and its subsidiary Canadian Utilities, finalized a
transaction combining ATCO Structures and ATCO Noise Management, both
wholly-owned subsidiaries of ATCO Ltd., with ATCO Frontec, a wholly-owned
subsidiary of Canadian Utilities. As a result of this transaction, ATCO and
Canadian Utilities have direct ownership interests of 75.5% and 24.5%
respectively in the new company, ATCO Structures & Logistics Ltd.
- In August 2009, ATCO Electric was authorized by the Alberta Minister of Energy
to prepare a facilities application to build and operate a new high-voltage
transmission line along a corridor on the east side of the province between
Edmonton and Calgary. Following approval of the facilities application by the
AUC, ATCO Electric will construct and operate the new line. The Alberta Electric
System Operator, in its recently released Long-term Transmission System Plan,
estimates the project will cost $1.65 billion and it is anticipated that the
majority of these costs will be incurred after 2011.
- In August 2009, Alberta Power (2000) Ltd. (Alberta Power), a subsidiary of
ATCO Ltd., received a judgement from the Tax Court of Canada ordering Canada
Revenue Agency (CRA) to reverse its 2006 reassessment of Alberta Power's 2001
tax return. The 2006 reassessment treated the proceeds received from the sale of
the H.R. Milner generating plant to the Alberta Balancing Pool as income rather
than a sale of an asset. The impact of the judgment is an $8.8 million increase
in ATCO earnings after non-controlling interests and a refund of approximately
$28.0 million.
Financial Summary and
Reconciliation of Adjusted For the Three Months For the Nine Months
Earnings Ended September 30 Ended September 30
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2009 2008 2009 2008
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($ Millions except per share data) Unaudited
Reported Earnings 61.0 52.5 205.1 197.4
ATCO Power Mark-to-Market Adjustment 1.1 4.0 2.8 0.5
H.R. Milner Tax Decision (8.8) - (8.8) -
Reallocation of Post Employment
Benefits - - - (2.8)
Federal Court of Appeal Tax Decision - (1.6) - (1.6)
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Adjusted Earnings (1) 53.3 54.9 199.1 193.5
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Earnings Per Share 1.05 0.91 3.54 3.42
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Adjusted Earnings Per Share (1) 0.92 0.95 3.44 3.35
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Revenues 684.3 763.4 2,247.5 2,359.2
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Funds Generated By Operations (1) (2) 218.7 204.5 663.1 643.4
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(1) These measures are not defined by Generally Accepted Accounting
Principles and may not be comparable to similar measures used by other
companies.
(2) This measure is cash flow from operations before changes in non-cash
working capital.
Adjusted earnings for the three months ended September 30, 2009, decreased
primarily due to decreased Canadian, Australian and U.S. manufacturing
activities in ATCO Structures & Logistics and lower margins for natural gas
liquids (NGL) extraction in ATCO Midstream. These decreases in Adjusted Earnings
were partially offset by the timing and demand for natural gas storage resulting
in higher storage fees for ATCO Midstream, the impact of the Removal of the
Carbon Facility from Regulation and Suspension of the Carbon Rate Riders in ATCO
Gas, the impact of the ATCO Electric 2009/2010 general tariff application
decision (ATCO Electric GTA), and lower operating and maintenance costs in ATCO
Electric compared to amounts included in customer rates.
Adjusted earnings for the nine months ended September 30, 2009, increased
primarily due to increased equity earnings from the Al Habtoor - ATCO Modular
Building Solutions Contracting LLC partnership (Saadiyat Island Project) located
in the United Arab Emirates which are recorded in other income, increased South
American manufacturing operations and the impact of a settlement completed in
the first quarter of 2009 relating to the cancellation of a work force housing
camp for the Fort Hills Energy Limited Partnership (Fort Hills Settlement) in
ATCO Structures & Logistics. Other contributing factors to the increased
Adjusted Earnings were the impact of the ATCO Pipelines' negotiated settlement
decision for 2008 and 2009, the impact of the ATCO Electric GTA, and lower
operating and maintenance costs in ATCO Electric compared to amounts included in
customer rates. These increases in Adjusted Earnings were partially offset by
lower margins for NGL extraction in ATCO Midstream, lower merchant performance
in ATCO Power's and ATCO Resources' Alberta generating plants due to lower spark
spreads in the Alberta electricity market, the 2008 recognition of insurance
proceeds from the 2007/2008 Barking outage and lower exchange rates on
conversion of United Kingdom (U.K.) revenues to Canadian dollars in ATCO Power's
U.K. operations.
Revenues for the three months ended September 30, 2009, decreased primarily due
to decreased Canadian, Australian and U.S. manufacturing operations in ATCO
Structures & Logistics, lower NGL prices and volumes in ATCO Midstream, lower
natural gas fuel purchases recovered on a "no-margin" basis and lower exchange
rates on conversion of U.K. revenues to Canadian dollars in ATCO Power's U.K.
operations, and lower merchant performance in ATCO Power's and ATCO Resources'
Alberta generating plants due to lower prices in the Alberta electricity market.
These decreases in revenues were partially offset by the Removal of the Carbon
Facility from Regulation and Suspension of the Carbon Rate Riders in ATCO Gas,
the impact of the ATCO Electric GTA and the timing and demand for natural gas
storage resulting in higher storage fees for ATCO Midstream.
Revenues for the nine months ended September 30, 2009, decreased primarily due
to lower NGL prices and volumes and lower sales of natural gas purchased for
third parties by ATCO Midstream, lower merchant performance in ATCO Power's and
ATCO Resources' Alberta generating plants due to lower prices in the Alberta
electricity market, lower exchange rates on conversion of U.K. revenues to
Canadian dollars and the 2008 recognition of insurance proceeds from the
2007/2008 Barking outage and lower natural gas fuel purchases recovered on a
"no-margin" basis in ATCO Power's U.K. operations. Also contributing to
decreased revenues was the impact of applying new accounting standards in ATCO
Utilities relating to the recognition of revenues for rate regulated assets and
decreased Canadian, U.S. and Australian manufacturing operations in ATCO
Structures & Logistics. These decreases in revenues were partially offset by the
impact of the ATCO Electric GTA, the impact of the ATCO Gas 2008/2009 general
rate application decision and increased South American manufacturing operations
and Camp Support Services activities in ATCO Structures & Logistics.
Funds generated by operations for the three months ended September 30, 2009,
increased primarily due to higher cash earnings partially offset by decreased
deferred availability incentives in Alberta Power (2000).
Funds generated by operations for the nine months ended September 30, 2009,
increased primarily due to higher cash earnings.
ATCO Ltd.'s consolidated financial statements and management's discussion and
analysis of financial condition and results of operations for the three and nine
months ended September 30, 2009, will be available on ATCO Ltd.'s website
(www.atco.com) or via SEDAR (www.sedar.com) or can be requested from the
Corporation.
Alberta-based ATCO Ltd., with more than 7,700 employees and assets of
approximately $9.9 billion, delivers service excellence and innovative business
solutions worldwide with leading companies engaged in Utilities (pipelines,
natural gas and electricity transmission and distribution), Energy (power
generation and midstream services), Structures & Logistics (manufacturing,
logistics and noise abatement) and Technologies (business systems solutions).
More information can be found on its website www.atco.com.
Forward-Looking Information:
Certain statements contained in this news release may constitute forward-looking
information. Forward-looking information is often, but not always, identified by
the use of words such as "anticipate", "plan", "estimate", "expect", "may",
"will", "intend", "should", and similar expressions. Forward-looking information
involves known and unknown risks, uncertainties and other factors that may cause
actual results or events to differ materially from those anticipated in such
forward-looking information. The Corporation believes that the expectations
reflected in the forward-looking information are reasonable, but no assurance
can be given that these expectations will prove to be correct and such
forward-looking information should not be unduly relied upon.
Any forward-looking information contained in this news release represents the
Corporation's expectations as of the date hereof, and is subject to change after
such date. The Corporation disclaims any intention or obligation to update or
revise any forward-looking information whether as a result of new information,
future events or otherwise, except as required by applicable securities
legislation.
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