ENMAX Corporation today announced 2003 net earnings of $168.1 million, a 12% increase in shareholder's equity to $1.13 billion and a 43% increase in dividends paid to its shareholder, The City of Calgary.
Net earnings increased in 2003 from $166.6 million recorded in 2002, and revenues of $1.21 billion reflect a 5% increase over 2002. Most of this increase was attributed to selling and distributing more energy to customers. The unregulated retail business sold 9,552 gigawatt hours (GWh) of electricity to approximately 420,000 customers across Alberta, a 4% increase in volume compared to 2002. The regulated transmission and distribution business increased volumes by 2% in 2003 compared to 2002, distributing 7,928 GWh of electricity to customers in and around Calgary. As well, increased residential housing activity in Calgary resulted in the competitive power services business having a strong year.
In the fourth quarter of 2003, net earnings were $46.7 million compared to $38.4 million in the fourth quarter of 2002. Total revenues were $300.9 million in the fourth quarter of 2003 compared to $321.7 million in the same period of the prior year primarily due to lower wholesale prices in the fourth quarter of 2003.
Wholesale electricity prices in Alberta's power pool averaged $63 per megawatt hour (MWh) in 2003 compared to $44 per MWh in 2002. This increase in 2003 wholesale prices over 2002 enabled higher annual revenue which was partially offset by higher electricity supply costs for the company.
The City of Calgary received dividend payments of $50.0 million in 2003, up substantially from $35.0 million in 2002. This is consistent with a dividend policy which sees the shareholder receive the higher of $30.0 million or 30% of the prior year's net earnings.
During 2003, ENMAX invested $168.5 million into capital projects. About 40% of this served to expand the distribution and transmission system to meet customer growth. In 2003, the company also invested $43.3 million in a joint venture to build Canada's largest single site wind farm. Additionally the company developed a new corporate headquarters, one of Canada's first buildings to receive the federal government's Environmental Choice Program® EcoLogo certification.
ENMAX continued to pay down debt, achieving a debt to capitalization ratio of 12.5% at year end. This favourable position enables the company to implement its strategic plan, investing in both unregulated and regulated business opportunities within and outside of Alberta. ENMAX has received strong endorsement of its financial health through an A rating from Dominion Bond Rating Service and an A- rating from Standard and Poor's.
"We built a strong balance sheet so we can prosper in a competitive commodity business, access the funds to expand ENMAX and achieve strong earnings in future years," said Bob Nicolay, president and chief executive officer.
ENMAX's 2003 consolidated financial statements and notes are available at enmax.com and sedar.com. More details will be provided in the 2003 annual report, scheduled for publication in April 2004.
ENMAX Corporation, a wholly owned subsidiary of The City of Calgary, provides electricity, natural gas and value-added services to more than 420,000 residential, commercial and industrial customers in Alberta through its subsidiary companies. For more information, visit our website at enmax.com.
2003 Year End Questions & Answers