DULUTH, Minn.–(BUSINESS WIRE)–Feb. 17, 2021– ALLETE, Inc. (NYSE: ALE) today reported 2020 earnings of $3.35 per share on net income of $174.2 million and operating revenue of $1.2 billion. Reported results from 2019 were $3.59 per share on net income of $185.6 million and operating revenue of $1.2 billion. 2020 results were impacted by lower sales due to the COVID-19 pandemic and settlement of the Minnesota Power rate case earlier in the year. Net income in 2019 includes 24 cents per share for impacts of the gain on the sale of U.S. Water Services offset by its partial year financial results.
“ALLETE’s operating and financial results for 2020 exemplify our company’s resilience in the face of unprecedented challenges brought on by the COVID19 pandemic,” said ALLETE President and CEO Bethany Owen. “Our early action on safety and financial positioning will enable us to move beyond the pandemic, even stronger, with our clean energy strategy.”
ALLETE’s Regulated Operations segment, which includes Minnesota Power, Superior Water, Light and Power and the Company’s investment in the American Transmission Co., recorded net income of $136.3 million, compared to $154.4 million 2019. Earnings reflect lower net income at Minnesota Power primarily due to: lower kilowatt-hour sales to retail customers due to COVID-19 impacts; lower revenue resulting from the expiration of certain municipal and power sale contracts; higher depreciation expense; and lower fuel adjustment clause recoveries in 2020 with the adoption of a new fuel adjustment clause methodology. These decreases were partially offset by higher rates resulting from Minnesota Power’s rate case and increased earnings related to the GNTL. In addition, results in 2020 included a second quarter 16 cent per share charge from the Minnesota Power rate case resolution for the refund of interim rates collected through April 30, 2020.
ALLETE Clean Energy recorded 2020 net income of $29.9 million compared to $12.4 million in 2019. Net income in 2020 reflects additional production tax credits and earnings from the new Glen Ullin, South Peak and Diamond Spring wind energy facilities, and higher wind resources at other wind energy facilities.
Corporate and Other businesses, which include BNI Energy and ALLETE Properties, recorded net income of $8.0 million in 2020 compared to net income of $19.9 million in 2019. Net income in 2020 included earnings from the company’s investment in the Nobles 2 wind facility which commenced operations in December 2020. Net income in 2019 included the gain on the sale of U.S. Water Services of $13.2 million after-tax.
“Our thoughtful positioning in the early stage of the COVID-19 crisis delivered on expectations in 2020, no small feat. Even with notable impacts lingering from the pandemic, our financial results exceeded our updated guidance range of $3.25 to $3.45 per share, which includes the 16 cent per share charge related to the Minnesota Power rate case resolution,” said ALLETE Senior Vice President and Chief Financial Officer Bob Adams. “Although we expect continued impacts of the COVID-19 pandemic in 2021, we remain keenly focused on delivering value to our investors and customers as we advance our clean energy strategy and positioning. This will set the stage for financial improvement and growth in 2022 as we execute on ALLETE’s key initiatives planned for 2021, including ALLETE Clean Energy’s growth initiatives and the Minnesota Power rate case filing later this year.”
Details of the Company’s 2021 earnings guidance were filed as part of today’s Form 8-K filing.
Live Webcast on February 17, 2021; financial slides posted on company website
ALLETE’s earnings conference call will be at 10:00 a.m. (EST), February 17, 2021, at which time management will discuss 2020 financial results and 2021 earnings guidance. To participate in the call, analysts are asked to dial 877-303-5852, pass code 9387381, ten minutes prior to the start time and refer to the “ALLETE’s Conference Call Announcing 2020 Financial Results.” All interested parties may listen to the live audio-only webcast accompanied by financial slides, which will be available on ALLETE’s Investor Relations website http://investor.allete.com/events-presentations. A replay of the call will be available through February 24, 2021 by calling (855) 859-2056, pass code 9387381. The webcast will be accessible for one year at www.allete.com.
ALLETE is an energy company headquartered in Duluth, Minn. In addition to its electric utilities, Minnesota Power and Superior Water, Light and Power of Wisconsin, ALLETE owns ALLETE Clean Energy, based in Duluth, BNI Energy in Bismarck, N.D., and has an eight percent equity interest in the American Transmission Co. More information about ALLETE is available at www.allete.com. ALE-CORP
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’s press releases and other communications may include certain non-Generally Accepted Accounting Principles (GAAP) financial measures. A “non-GAAP financial measure” is defined as a numerical measure of a company’s financial performance, financial position or cash flows that excludes (or includes) amounts that are included in (or excluded from) the most directly comparable measure calculated and presented in accordance with GAAP in the company’s financial statements.
Non-GAAP financial measures utilized by the company include presentations of earnings (loss) per share. ALLETE’s management believes that these non-GAAP financial measures provide useful information to investors by removing the effect of variances in GAAP reported results of operations that are not indicative of changes in the fundamental earnings power of the company’s operations, such as the charge for the recent Minnesota Power rate case resolution. Management believes that the presentation of non-GAAP financial measures is appropriate and enables investors and analysts to more accurately compare the company’s ongoing financial performance over the periods presented. See page 5 in this release for a reconciliation of 2020 annual GAAP earnings guidance range to 2020 annual adjusted earnings guidance range (Non-GAAP).
Consolidated Statement of Income
For the Periods Ended December 31, 2020 and 2019
Year to Date
Millions Except Per Share Amounts
Contracts with Customer – Utility
Contracts with Customer – Non-utility
Other – Non-utility
Total Operating Revenue
Fuel, Purchased Power and Gas – Utility
Transmission Services – Utility
Cost of Sales – Non-utility
Operating and Maintenance
Depreciation and Amortization
Taxes Other than Income Taxes
Total Operating Expenses
Other Income (Expense)
Gain on Sale of U.S. Water Services
Total Other Expense
Income Before Non-Controlling Interest and Income Taxes
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