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ENMAX reports third quarter net earnings

/ Calgary

ENMAX Corporation today announced its financial results for the nine months ended September 30, 2010. Excluding unusual items that occurred in 2009, comparable earnings for the nine months ended September 30, 2010 were $16 million ahead of the same period last year. Revenues for the nine months ended September 30 were also up in 2010 by $29 million as compared to the same period last year. 

Total reported earnings for the nine months ended September 30, 2010 were $135 million as compared to $119 million in the same period last year before unusual items.  The Corporation invested $94 million in transmission and distribution during the first nine months of 2010 to meet the growing needs of the city, an increase of 25 per cent over the same period last year. The dividend paid to The City of Calgary for the nine months ended September 30, 2010 was $46 million as compared to $41 million in the same period last year. 

For the three months ended September 30, 2010, revenues increased by $58 million and earnings were $30 million compared to $41 million for the same period in 2009. The company completed a comprehensive review of its depreciation policies and made an adjustment to amortization from previous estimates to reflect expected useful lives of certain operational and administrative assets.  This adjustment results in an additional $6 million of amortization per year.  A write-down of $3 million also occurred during the quarter related to IT assets no longer in use.

Both electricity and natural gas sales volumes increased in the nine months ended September 30, 2010 by 6 per cent over the same period in the prior year.

This quarter represents a major milestone in the organization's history. Five years ago this month the innovative EasyMax® retail program was launched. Since then hundreds of thousands of customers across Alberta have joined the program.

"When customers joined in 2005 and combined their gas and electricity on a single bill, we were able to deliver them the overall lowest cost electricity in the province," said Gary Holden, President and CEO. "We set out to make choosing low cost energy easy. We wanted customers to avoid being held hostage to penalties and complicated contracts. It really worked. More customers across the province have joined each and every year as the benefits became apparent. Future offers, including special offers for owners of solar power, micro wind turbines and electric cars, are just around the corner as the EasyMax® program enters the next phase."

ENMAX also received the green light from the Alberta Utilities Commission to commence with the construction of the 800 MW Shepard Energy Centre in East Calgary. The project also received approval from the Minister of Energy, under Section 95 of the Electric Utilities Act, demonstrating compliance with legislation that governs municipally owned generators.

"Scheduled for completion in 2015, this project will allow Albertans to enjoy low cost electricity well into the future," said Holden. "Shepard will use Alberta natural gas, provide support for more wind power in Southern Alberta, and relieve pressure on the transmission grid; a real win-win-win for the province".

ENMAX completed agreements in this quarter to sell its British Columbia assets in a strategic decision to focus on the Alberta market. The sale allowed ENMAX to recover its capital investment in B.C. and re-apply it to expand its Alberta business.

HIGHLIGHTS
(millions of dollars, except return on equity and operating statistics)

Three Months Ended SEPTEMBER 30, nine Months Ended september 30,
20102009 20102009
Total revenues 552.0494.2 1,748.21,719.4
Operating margin (1) 150.1129.0 476.8525.9
Net earnings29.740.8135.3166.9
Net earnings, excluding unusual items29.745.1135.3118.9
Return on equity (annualized) (2)10.0%12.1%

Operating statistics:
Electricity sold (gigawatt hours)4,8964,54114,44413,689
Natural gas sold (terajoules) 4,4822,357 24,27922,974
Distribution volumes (gigawatt hours)2,2582,0366,7096,631

Total shareholder's equity

1,788.4

1,694.2
Total assets3,826.43,632.0

(1) ENMAX uses the measure “Net earnings, excluding unusual items” in this news release. This measure does not have any standardized meaning prescribed by Canadian generally accepted accounting principles (GAAP). Management of ENMAX uses this non-GAAP measure to improve its ability to compare financial results between reporting periods and to enhance its understanding of operating performance. Net earnings, excluding unusual items is defined as Net earnings adjusted for prior period rate increases, gains from foreign exchange exposures and financial instruments and adjustments to income tax provisions.

(2) Return on equity (annualized) is equal to the rolling prior 12-month rolling net earnings divided by the average shareholder’s equity for the same 12-month period.

ENMAX Corporation, through subsidiaries and predecessors, has provided Albertans with safe, reliable electricity for over 100 years. ENMAX Corporation provides electricity, natural gas and value-added services to over 650,000 residential, commercial and industrial metered customer locations in Alberta. ENMAX Energy Corporation, a subsidiary of ENMAX Corporation, is Alberta’s leading competitive electricity retailer. Through subsidiaries, ENMAX Energy is one of Alberta’s largest investors in renewable energy and the first Canadian electricity retailer to offer customers the option to support wind generated energy. Also, ENMAX Corporation, through its subsidiary ENMAX Envision Inc., provides fibre optic networks for high speed data and internet communications.

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MEDIA CONTACT

Doris B. Kaufmann
Senior Media Relations Advisor
ENMAX Corporation
403-689-6150
mediaroom@enmax.com

All customers are free to purchase natural gas services from the default supply provider or from a retailer of their choice and to purchase electricity services from the regulated rate provider or from a retailer of their choice. The delivery of natural gas and electricity to you is not affected by your choice. If you change who you purchase natural gas services or electricity services from, you will continue receiving natural gas and electricity from the distribution company in your service area. For a current list of retailers you may choose from, visit www.ucahelps.alberta.ca or call 310-4822 (toll free in Alberta).

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