ST. JOHN'S, NEWFOUNDLAND AND LABRADOR--(CCNMatthews - July 31, 2007) - Newfoundland Power Inc. (TSX:FTS) today released its 2007 second quarter results.
Earnings in the second quarter of $8.0 million were comparable to the second quarter of 2006. Additional revenue from higher electricity sales was offset by the Company's lower allowed return on equity for 2007 and increased depreciation expense. Operating expenses for the second quarter were comparable to the same quarter last year.
"Despite upward pressure on operating expenses due to customer growth and inflationary increases, we are able to minimize our impact on electricity rates for customers by successfully managing our own costs," said Earl Ludlow, President and Chief Executive Officer, Newfoundland Power Inc.
The Company has invested approximately $30 million in capital projects across the island year to date. During the second quarter, the Company's Rattling Brook Hydroelectric Generating Plant refurbishment project began. The plant, which is located near Norris Arm in Central Newfoundland, is nearly 50 years old and requires extensive renovation.
"The Rattling Brook refurbishment project is the biggest capital project the Company has ever undertaken," says Ludlow. "Once completed, this capital investment of over $18 million will provide low-cost, clean energy and displace an additional 10,500 barrels of oil per year, which will help minimize the impact of the cost of oil on electricity rates and benefit the environment."
The Company continues to focus on improving the level of service it provides to customers and earned a customer satisfaction rating of 88% in the second quarter. "We continue to remain focused on meeting customer expectations, responding to their needs and improving on the service we provide," added Ludlow.
During the quarter, several thousand people including more than 100 community groups across the island came out in support of the Company's 10th anniversary of EnviroFest, which is an annual event promoting environmental and energy efficiency education and awareness. Tree planting projects took place in eight communities across the island. During EnviroFest, individuals were also encouraged to Take the Energy Savings Challenge. "We're pleased to be able to assist customers in any way possible to help them become more energy efficient," concluded Ludlow.
With a customer base of over 230,000 accounts, Newfoundland Power is dedicated to providing the highest level of customer service and reliability in the most cost-efficient manner possible. All the common shares of Newfoundland Power are owned by Fortis Inc., the largest investor-owned distribution utility in Canada, which serves almost two million gas and electric customers and has approximately $10 billion of assets. Its regulated holdings include a natural gas utility in British Columbia and electric utilities in five Canadian provinces and three Caribbean countries. Fortis Inc. owns non-regulated hydroelectric generation assets across Canada and in Belize and upper New York State. It also owns hotels and commercial real estate in Canada. Fortis Inc. shares are listed on the Toronto Stock Exchange and trade under the symbol FTS. Additional information can be accessed at www.fortisinc.com or www.sedar.com. For more information on Newfoundland Power's programs and services, visit www.newfoundlandpower.com.
Newfoundland Power may include forward-looking statements in this release which reflect management's expectations regarding the Company's future growth, results of operations, performance, business prospects and opportunities. Wherever possible, words such as "anticipate", "believe", "expects", "intend" and similar expressions have been used to identify the forward-looking statements. These statements reflect management's current beliefs and are based on information currently available to the Company's management. By their very nature, forward-looking statements are based on underlying factors or assumptions which are subject to inherent risks and uncertainties surrounding future expectations generally. Such risk factors or assumptions include, but are not limited to, general economic, market and business conditions, regulatory developments, weather and competition. Newfoundland Power cautions readers that a number of factors could cause actual results, performance or achievements to differ materially from the results discussed or implied in the forward-looking statements. These factors should be considered carefully and undue reliance should not be placed on the forward-looking statements. For additional information with respect to certain of these risks or factors, reference should be made to Newfoundland Power's continuous disclosure materials filed from time to time with Canadian Securities Regulatory Authorities. Newfoundland Power disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
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Newfoundland Power Inc.
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