ENMAX Records Solid Net Earnings

CALGARY, AB -- ENMAX Corporation today announced solid net earnings of $34.9 million in the first quarter of 2003, despite a 57 per cent increase in the cost to purchase electricity for resale to its customers. In the first quarter of 2002, net earnings were $41.5 million.

"The first three months of 2003 saw some of the most volatile commodity pricing since electricity deregulation commenced two years ago. We withstood most of this volatility through carefully constructed supply and retail portfolios," said Bob Nicolay, ENMAX president and chief executive officer. "Since then, we further decreased our exposure to price volatility by securing additional electricity supply at set prices."

In the first quarter of 2003, the average Power Pool of Alberta (Power Pool) price was $84 per megawatt hour (MWh) compared to $36 per MWh in the same period in 2002. The main factor driving up electricity prices was an increase in natural gas prices from about $3 per gigajoule (GJ) in the first quarter of 2002 to about $8 per GJ in the first quarter of 2003. The price of natural gas impacts market prices for electricity because it is the fuel used to generate 41 per cent of Alberta's electricity.

Higher electric costs were tempered by increased revenue from retail customers on variable rates and lower general and administrative expenses. ENMAX paid The City of Calgary $12.5 million in dividends and $17.9 million in municipal consent and access fees. At March 31, 2003, ENMAX's debt to total capitalization ratio was 15.4 per cent and shareholder's equity was $1.03 billion. On an annualized basis, return on equity was 14 per cent during the first three months of 2003.

"ENMAX's first quarter performance demonstrates the company is structured to prosper despite the ups and downs of commodity prices in a deregulated business. In addition, we continue to be financially well positioned to grow our transmission, distribution and retail businesses in scale and scope," said Mr. Nicolay.

ENMAX Corporation, a wholly owned subsidiary of The City of Calgary, provides electricity, natural gas and value-added services to more than 400,000 residential, commercial and industrial customers in Alberta through its subsidiary companies. For more information, please visit our website at enmax.com.

ENMAX