ITC Holdings Corp. Reports Fourth Quarter and Full Year 2005 Results

Mar 15, 2006

ITC Holdings Corp. Reports Fourth Quarter and Full Year 2005 Results

Highlights

  • Net income for the fourth quarter of $1.7 million or $0.05 per diluted share compared to net loss of $(1.7) million or $(0.06) per diluted share in 2004
  • Net income for year ended December 31, 2005 of $34.7 million, or $1.06 per diluted share compared to net income of $2.6 million or $0.08 per diluted share in 2004
  • $117.8 million invested in property, plant & equipment for year ended December 31, 2005

NOVI, Mich., Mar. 15 /PRNewswire-FirstCall/ -- ITC Holdings Corp. (NYSE: ITC) today announced net income for the fourth quarter ended December 31, 2005 of $1.7 million or $0.05 per share on a diluted basis, compared with a net loss of $(1.7) million, or $(0.06) per share on a diluted basis for the fourth quarter of 2004. Net income for the year ended December 31, 2005 was $34.7 million, or $1.06 per share on a diluted basis compared with net income of $2.6 million or $0.08 per share on a diluted basis for the comparable period last year.

Operating revenues of $46.0 million for the fourth quarter 2005 increased by $17.6 million over the same period in 2004. The expiration of a rate freeze on December 31, 2004 for customers of International Transmission Company ("ITCTransmission"), ITC Holdings Corp.'s operating subsidiary, accounted for $13.4 million of this increase. For the year ended December 31, 2005 operating revenues of $205.3 million increased $78.8 million over the same period in 2004. Of this increase $57.3 million was due to the expiration of the rate freeze on December 31, 2004 and $12.7 million of the increase is due to the expiration of the requirement to refund 75% of point-to-point revenues.

The full year 2005 results include $6.7 million of fees incurred in connection with ITC's initial public offering completed on July 29 to terminate certain management agreements. 2005 fully diluted earnings per share excluding the impact of these expenses would have been $1.19.

For the year ended December 31, 2005, ITCTransmission invested $117.8 million in property, plant and equipment. ITCTransmission expects at least $125 million of capital investments in 2006, an increase of $15 million over the company's previous forecast.

"ITC continues to deliver on our commitment to customers to improve reliability. In 2005 we invested $117.8 million, mostly in infrastructure improvements and upgrades to our transmission system," said Joseph Welch, president and CEO of ITC Holdings Corp. "In addition, we have pulled forward maintenance work that would have been done in subsequent periods to promote system reliability."

ITCTransmission is a business regulated by the Federal Energy Regulatory Commission and operates under an approved annual rate setting mechanism known as "Attachment O". Attachment O enables the company to generate predictable revenues. Variability in items such as weather or operating costs can change earnings in any period compared to the prior year, but these variations are not expected to materially impact ITC over the longer term because Attachment O adjusts for these effects in subsequent rate setting periods.

ITCTransmission is focused on best in class operations, maintenance, improving reliability and reducing congestion to lower the overall cost of delivered energy to end-use consumers.

ITC Holdings Corp. will conduct a conference call to discuss fourth quarter and year-end 2005 earnings results at 11:00 a.m. EST Thursday, March 16. Joseph L. Welch, president and CEO, will provide a business overview for the year and Edward M. Rahill, senior vice president and CFO, will provide a financial update of both the fourth quarter and the year-end results. Individuals wishing to participate in the conference call may dial toll-free (800) 289-0544; there is no passcode. The conference call replay, available through March 23rd, can be accessed by dialing toll-free (888) 203-1112, passcode 5237804. Investors, the news media and the public may listen to a live Internet broadcast of the meeting at http://investor.itc-holdings.com. The webcast also will be archived on the ITC website at http://investor.itc-holdings.com.

More detail about the 2005 results may be found in ITC Holdings Corp.'s Form 10-K filing. Once filed with the SEC, an electronic copy of the 10-K can be found at ITC Holdings Corp.'s website, http://investor.itc-holdings.com. Written copies can also be made available by contacting us either through our website or the phone listings below.

About ITC Holdings Corp.

ITC Holdings Corp.'s wholly owned operating subsidiary, ITCTransmission, is the first independently owned and operated electricity transmission company in the United States. ITCTransmission owns, operates and maintains a fully- regulated, high-voltage system that transmits electricity to local electric distribution facilities from generating stations in Michigan, other Midwestern states and Ontario, Canada. The local distribution facilities connected to the ITCTransmission system serve an area comprised of 13 southeastern Michigan counties, including the Detroit metropolitan area. For more information on ITCTransmission, please visit http://www.itctransco.com. For more information on ITC Holdings, please visit http://www.itc-holdings.com.

Safe Harbor Statement

This press release contains certain statements that describe our management's beliefs concerning future business conditions and prospects, growth opportunities and the outlook for our business and the electricity transmission industry based upon information currently available. Such statements are "forward-looking" statements within the meaning of the Private Securities Litigation Reform Act of 1995. Wherever possible, we have identified these forward-looking statements by words such as "anticipates", "believes", "intends", "estimates", "expects", "projects" and similar phrases. These forward-looking statements are based upon assumptions our management believes are reasonable. Such forward-looking statements are subject to risks and uncertainties which could cause our actual results, performance and achievements to differ materially from those expressed in, or implied by, these statements, including, among other things the risks and uncertainties disclosed in our annual reports on Form 10-K and our quarterly reports on Form 10-Q filed with the Securities and Exchange Commission from time to time.

Because our forward-looking statements are based on estimates and assumptions that are subject to significant business, economic and competitive uncertainties, many of which are beyond our control or are subject to change, actual results could be materially different and any or all of our forward- looking statements may turn out to be wrong. The statements are reflective as of the date made and can be affected by assumptions we might make or by known or unknown risks and uncertainties. Many factors mentioned in our discussion in this report will be important in determining future results. Consequently, we cannot assure you that our expectations or forecasts expressed in such forward-looking statements will be achieved. Actual future results may vary materially. Except as required by law, we undertake no obligation to publicly update any of our forward-looking or other statements, whether as a result of new information, future events, or otherwise, unless required by law.