CALGARY, April 17 /CNW/ - (TSX:FTS) - FortisAlberta Inc. announced today 2007 first quarter results reporting net earnings of $11.9 million compared to 2006 first quarter net earnings of $9.5 million.
The $2.4 million increase in net earnings in the first quarter of 2007 was primarily related to increased revenues combined with decreased income tax expense, partially offset by increased interest and depreciation costs.
"Our improved performance is a result of continuing productivity improvements, which have seen operating costs at FortisAlberta increase only marginally in an inflationary environment," said Philip Hughes, President and CEO, FortisAlberta. "Our focus on achieving efficient and reliable operations, improving customer satisfaction and strong safety practices has allowed us to meet customer expectations during the quarter."
Total revenue for the quarter was $63.3 million compared to $61.8 million for the same period in 2006. Revenue increased by $1.5 million primarily due to the increase in distribution revenue as a result of the 2007 rate increase of 0.7 per cent and an increase in the number of residential, farm and oil and gas sites, partially offset by a decrease in transmission and miscellaneous revenue.
During the quarter, FortisAlberta invested $43.4 million, net of customer contributions of $11.8 million, in capital projects compared to $40.0 million, net of customer contributions of $5.7 million, in 2006. The company experienced a decrease in distribution projects in comparison to last year. However, these were offset by increased spending in facilities and information technology to meet current business requirements. "There has been a slight slow down in growth as a result of lower commodity prices for gas and crude oil price volatility causing projects to be deferred or cancelled," said Hughes. "However, capital investment in 2007 will continue to be strong."
FortisAlberta expects to invest $243 million in capital projects for 2007, net of customer contributions totaling $33 million, compared to $205 million, net of customer contributions totaling $37 million, in 2006. "Strategically investing in capital projects to enhance and upgrade our electrical system will help support Alberta's customer growth requirements and continue to position FortisAlberta to provide high-quality electrical service to our customers in a safe, reliable, and cost-effective manner," added Hughes.
In the first quarter of 2007, FortisAlberta donated $100,000 as part of its partnership with the Shock Trauma Air Rescue Society (STARS) Human Patient Simulator Program. The company has also committed donations to the Alberta Birds of Prey Centre and Junior Achievement of Southern Alberta.
The Company started construction of its new office and operations facility in the City of Airdrie. This facility will house approximately 300 FortisAlberta employees and is expected to be complete early in 2008. In addition, FortisAlberta opened new operational facilities in St. Albert, Brooks and Sylvan Lake.
For a full copy of FortisAlberta's financial statements, management discussion and analysis and annual information form, please visit www.fortisalberta.com and click on the Investor Centre.
FortisAlberta is an electric distribution company with approximately 433,000 customers and more than 104,700 kilometres of power lines. It is a wholly owned indirect subsidiary of Fortis Inc. - a diversified, international distribution utility holding company with assets of approximately $5.4 billion and annual revenues of approximately $1.5 billion. The Common Shares, First Preference Shares, Series C; First Preference Shares, Series E; and First Preference Shares, Series F; and Subscription Receipts of Fortis Inc. are traded on the Toronto Stock Exchange under the symbols FTS, FTS.PR.C, FTS.PR.E, FTS.PR.F, and FTS.R respectively. Fortis Inc. information can be accessed at www.fortisinc.com.
FortisAlberta may include forward-looking statements in this release. By their very nature, forward-looking statements are based on underlying assumptions and are subject to inherent risks and uncertainties surrounding future expectations generally. Such events include, but are not limited to, general economic, market and business conditions, regulatory developments, weather and competition. FortisAlberta cautions readers that should certain events or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary significantly from those expected. For additional information with respect to certain of these risks or factors, reference should be made to FortisAlberta's continuous disclosure materials filed from time to time with Canadian Securities Regulatory Authorities. FortisAlberta disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.