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ALLETE (ALE) Misses on Q4 Earnings, Issues 2018 Guidance

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ALLETE, Inc. (ALE - Free Report) reported fourth-quarter 2017 adjusted earnings of 62 cents per share, missing the Zacks Consensus Estimate of 75 cents by 17.3%. On a year-over-year basis, earnings plunged 30.3%.

GAAP earnings in the fourth quarter came in at 81 cents compared with 89 cents reported in the year-ago quarter. The difference between GAAP and operating earnings in the reported quarter was due to the one-time gain of 41 cents and one-time charge of 22 cents.

Total Revenues

In the reported quarter, the company’s total revenues of $337.9 million missed the Zacks Consensus Estimate of $348 million by 2.9%. Further, revenues edged down 1.17% from $341.5 million recorded in the prior-year quarter.

Allete, Inc. Price, Consensus and EPS Surprise

Allete, Inc. Price, Consensus and EPS Surprise | Allete, Inc. Quote

Highlights of the Release

ALLETE’s total electricity sales volume grew nearly 10.5% year over year to 3,779 million kilowatt-hours.

The company’s total operating expenses totaled $304.7 million, reflecting a rise of 8.6% year over year. The uptick in operating expenses primarily stemmed from elevated cost of Fuel, Purchased Power and Gas.

Operating income in the quarter plummeted 45.6% year over year to $33.2 million. Interest expenses remained flat year over year at $17.3 million.

Financial Update

ALLETE’s cash and cash equivalents, as on Dec 31, 2017, were $98.9 million, up from $27.5 million as of Dec 31, 2016.

Long-term debt as on Dec 31, 2017 was $ 1,439.2 million, higher than $1,370.4 million at the end of 2016.

Guidance

The company issued its full-year 2018 earnings per share guidance in the range of $3.20-$3.50.

Peer Releases

NextEra Energy (NEE - Free Report) reported fourth-quarter 2017 adjusted earnings of $1.25 per share, missing  the Zacks Consensus Estimate of $1.31 by 4.6%.

Dominion Energy (D - Free Report) reported fourth-quarter operating earnings of 91 cents per share, beating the Zacks Consensus Estimate of 88 cents by 3.4%.

American Electric Power (AEP - Free Report) reported fourth-quarter 2017 operating earnings of 85 cents per share, surpassing the Zacks Consensus Estimate of 81 cents by 4.9%.

Zacks Rank

ALLETE currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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